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What Will B.C.'s Next Government Do About Its Simmering Real Estate Market?

05/08/2017 04:35 EDT | Updated 05/08/2017 04:36 EDT

A simple Google search of "political promises in Canadian real estate market" gives you an idea of where our minds are at this election. From Canadian Business, "Why Canada's politicians won't do what it takes on housing market"; to CBC, "Politicians meddle with real estate -- but would Canadians tolerate intervention in other markets?"; and The Globe and Mail, "How to fix Canada's red-hot housing markets: A guide to what's happening, what's been proposed and what buyers can do," the sentiment is pretty clear. Canadians want to know what our next provincial government is going to do about the simmering B.C. real estate market?

Here's a breakdown of how each party is crossing its heart. Let's just hope none of them are crossing their fingers as well.


THE GREEN PARTY

A scientist and politician, Green party Leader Andrew Weaver holds a PhD in applied mathematics from the University of British Columbia. Let's hope this means he can count how our annual salary stands up against our mortgage payments; should we be so lucky to have such problems.

In April, Weaver unveiled an affordable housing platform "designed to cool the residential real-estate market, increase the supply of affordable accommodation and give the middle class a chance at home ownership," so the Vancouver Sun reported. How does he plan to do this? By taxing foreigners, of course. Well, that and a few other things.

Weaver proposed to double the foreign buyers tax on B.C. real estate from its current 15 per cent to 30 per cent throughout the entire province. In a bid to quell any conclusions over his motivations, Weaver stated that this tax is "not biased against any country," but, rather, ensures that people who live and work in B.C. can afford it.

The Green party has also proposed introducing a sliding property transfer tax that would be based on the value of the property. With zero per cent on the first $200k of a property to 12 per cent on any property over $3 million; it's a significant increase from its current position at three per cent on properties of $2 million.

THE NDP PARTY

A lawyer who served as Housing Critic as a Member of the Legislative Assembly of British Columbia, NDP and Point Grey MLA (a title which he defeated Premier Christy Clark to assume) David Eby doesn't look very happy; about his opposing parties' views on B.C. real estate that is.

Feeling the original 15 per cent foreign buyer tax was "not broad enough," Eby pointed out that the introduction of the new tax doesn't and won't affect anyone who was already in the market. As a result, the NDP have proposed a Housing Affordability Fund as well as a Speculator Fee Act. It's effect is simple: despite the length of time a property has already been owned by a foreign national, if they didn't pay taxes in B.C. on their income they would be accountable to a retroactive foreign buyer tax of two per cent on the assessed value and this would extend to condo pre-sales.

vancouver real estate

Rooftops of houses in the Kitsilano neighbourhood and the downtown core are seen in Vancouver, British Columbia, Canada Jan. 7, 2017. (Photo: Chris Helgren/Reuters)

Eby also aims to tighten regulation on trusts and other "corporate vehicles to disguise home ownership." Other issues Eby plans to tackle are pre-sale contracts for new homes. In his case, an NDP win would mean required registration of all pre-sale contracts for new homes. The party has also promised renters $400 a year to help offset price spikes of as much as 40 per cent in the last year alone.

THE B.C. LIBERALS'

Currently in power, the Liberal party hardly needs an introduction. But their strategy on housing just might. After the introduction of the 15 per cent foreign buyer tax, the Liberals' campaigns has focused more on promises of high-paying jobs in technology and less on the real estate market itself.

Expressing interest in streamlining building regulations, the Liberals' are focused on wooing developers to build more multi-family dwellings at an increased pace. Altogether, the party has promised a staggering $920 million, which will go to the creation of over 5,000 new units of affordable rental housing for B.C.'s most financially destitute.

The Liberals have also made promises to buoy a home renovation tax credit plan, which would provide homeowners with up to $20,000 to build rental suites and, as a result, enjoy an extra income.

THE LAST WORD

With tensions rising over the real estate market here in B.C., the 41st British Columbia general election promises to be anything but dull. Touting campaign promises from sliding property taxes to bonuses for renters, let's hope whoever wins brings some much needed sanity back to the market and a real chance for those who wish to remain here on the west coast.

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