The City of Vancouver has reacted positively to provincial measures aimed at housing affordability.
“I’ve been calling on the Province for over a year to take bold action on our overheated housing market and address the impacts of unregulated, speculative global capital on local real estate,” Mayor Gregor Robertson said in a prepared statement. “The year-over-year price gains we’ve seen are not sustainable and put our City’s economy at risk. Today’s legislation is a major acknowledgement by the Province that they have an important role to play in the housing market and affordability is not simply an issue for municipalities to deal with.”
This morning (July 25), Minister of Finance Mike de Jong unveiled a number of policies, including a new 15-percent tax on residential properties sold to foreign nationals and foreign-controlled corporations.
The province also amended the Vancouver Charter to allow the city to create a tax it said it wants to apply against houses and condos that are left vacant.
Robertson welcomed the changes but also cautioned that further action is required to bring housing costs back in line with most Metro Vancouver residents’ incomes.
“While I’ve called for other regulatory tools—including luxury and speculation taxes—a higher transfer tax on foreign buyers has the potential to address some of the speculation we’re seeing in our housing market, which would be a positive step in easing affordability pressures on residents,” he said.
“Ultimately, the issue is not who buys but how housing is being used: people who use housing solely as a means to make money—rather than living and working in Vancouver—should be taxed as such. That’s why legislation to enable the City to bring in an empty homes tax is an important step forward in making the best use of all our housing, provided it is followed up with a commitment by the Province to meaningfully share data with the City.
“There’s no one single solution to affordability,” he continued. “Even if we stopped all speculative investment in housing today, we’d still have a near-zero rental vacancy rate, and thousands of people on waiting lists to get off the streets and into housing. I urge the Province to match their efforts to cool the market with a commitment to invest in creating new low and middle income housing in Vancouver and throughout B.C. Vancouver is willing to do more than our share, and we continue to offer 20 shovel-ready sites of City-owned land worth $250M to build affordable housing in partnership with the B.C. and federal governments."
According to provincial data on Metro Vancouver real estate, foreign nationals accounted for 5.1 percent of sales in the region during a three-week period analyzed in June.
According to a study of 2014 data commissioned by the City of Vancouver, one percent of single-family and duplex homes sat empty that year and 12.5 percent of condos were left vacant. That equates to 950 single-family and duplex homes, 125 rowhouses, and 9,750 empty apartments in Vancouver.
Robertson has said that the details of how a tax on vacant homes will be applied—including rates and how the city defines a vacant home—still have to be worked out.