NDP introduces bills to tax real estate speculators, stop shadow-flipping
Published Thursday, March 17, 2016 3:32PM PDT
Last Updated Thursday, March 17, 2016 6:40PM PDT
The B.C. NDP has put forth two bills intended to cool down Metro Vancouver’s red-hot housing market, including a measure to stop the controversial practice of shadow-flipping.
Opposition leader John Horgan introduced the bills Thursday morning, the day after his party hosted an emotionally charged town hall meeting on housing unaffordability that was attended by upwards of 700 people.
One bill would target speculators by forcing property owners who don't pay income tax in the province and leave homes sitting vacant to pay a levy of two per cent of the assessed property value.
“The proceeds of this levy would be used to establish a Housing Affordability Fund to benefit the entire community,” Horgan told the legislature.
“Put the burden on absentee owners to pay a little bit more so the people who want to work and live in Vancouver can afford to do so.”
The tax wouldn’t affect those who rent out their homes or seniors.
The other bill was designed to address shadow-flipping, the legal practice of re-assigning home sale contracts before the sale is closed, by imposing fees on every step of the process. The Property Transfer Tax, which is currently only applied once before the final sale, would be applied every time a sale is assigned.
Horgan called on Housing Minister Rich Coleman to adopt both measures, citing the hundreds of voices calling for action at Wednesday’s meeting.
“Will he stop burying his head in the stand, will he stop ignoring the crisis that’s afflicting the people in the lower mainland and will he take some action today to alleviate housing affordability challenges?” he said.
Coleman said the government is already working to address affordability issues, with measures that were introduced by the Minister of Finance in last month’s budget.
Those include an exemption on property transfer taxes on newly built homes priced up to $750,000, and a small hike in the property transfer tax for properties over $2 million.
The government is also collecting new data on home buyers, including their citizenship, to get a better sense of how foreign investment is affecting the market.
Coleman said another key to tackling the problem will be increasing density and supply by cutting the red tape delaying the building of new housing in Metro Vancouver.
“We’re going to sit down with municipalities and we’re going to talk about how we can improve the accountability relative to the cost and time it takes to build a home,” Coleman said.
It can cost an estimated $200,000 per house and up to five years’ wait “before a shovel actually goes in the ground” in parts of the Lower Mainland, according to the minister.