Despite a number of municipal, provincial, and federal policies recently implemented to slow the prices of real estate, affordable homes remain out of reach for the majority of Vancouverites.
The B.C. Government and Service Employees’ Union (BCGEU) believes that it’s within the province’s power to curb the value of property. Following its launch of a campaign for housing affordability earlier this month, the union has released a detailed plan that suggests how to resolve housing affordability.
With nearly 2,000 signatures in support of its ideas, the report is rapidly gaining popularity.
BCGEU’s plan hinges on the idea that the housing crisis is caused by speculative buying. It argues that property is being treated primarily as a financial asset, rather than a home, by both local and foreign investors. Prices are increasing as banks and other financial institutions approve larger mortgages than they would historically allow, encouraging buyers to borrow more to get into the market. Those higher mortgage payments are then passed on to tenants as higher rents.
“British Columbia has been gripped by a housing affordability crisis that has deprived an entire generation of the ability to rent or own housing that fits their needs,” the report says. “Workers are struggling to find housing for their families, leading many to move further away from work and others to leave the province altogether. B.C. is losing experienced workers and economic productivity.”
To counter this, the document proposes three main goals.
Firstly, it calls for a reform to property taxes to target speculators, and raise funds for affordable housing and infrastructure. That could be achieved, it argues, by adding a surcharge to the Foreign Buyers Tax for owners who do not reside or earn income in B.C.; by removing loopholes that allow landowners to avoid property transfer tax by transferring shares in a corporation; and by taxing land made desirable by infrastructure projects.
Secondly, it aims to amend legislation to protect renters, and better regulate real estate transactions. The Residential Tenancy Act would be updated to close loopholes, short-term rentals would be taxed, and local and provincial governments would be given more power over housing legislation.
Thirdly, the plan asks for investment in new affordable public housing and infrastructure. It would include a 10-year building strategy for affordable housing stock, and planning the placement of units close to upcoming transit hubs.
“B.C. has become the most expensive province to buy or rent a home in Canada,” the report says. “The average home price in B.C. is now close to $694,000. While the crisis is felt most acutely in B.C.'s largest cities, this crisis is affecting communities across the province.
“Earlier this year, Vancouver was named North America's least affordable city, ranking above cities like San Francisco and Manhattan. The median home in Vancouver now costs 17.3 times the median annual household income. Solving this crisis requires bold action to tackle loose regulation in the housing market that has allowed speculators and banks to reap immense profits on the backs of British Columbians.”
The full report can be downloaded here.
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