What comes next? BC NDP walking fine line beyond empty homes tax

When B.C.’s finance minister announced the province would be adding six more communities to its list of jurisdictions subject to its speculation and vacancy tax, there were few complaints.

After all, it’s truly a one-per-center issue: 99 per cent of British Columbians have not paid the tax and are unlikely to ever do so, given how hard it is to buy one property, let alone have a second or third sitting empty for more than half the year. 

But the announcement exposed just how ubiquitous skyrocketing housing prices are across the province and how difficult it’ll be for the province to take another substantive step with the kind of widespread approval the empty homes tax has seen. 

Several studies confirmed there were thousands of empty condos in Metro Vancouver’s gleaming towers, and massive homes in tony neighbourhoods without any visible signs of occupancy were commonplace -- so there was widespread and understandable support for a financial penalty on those leaving homes empty or occupied only occasionally. 

But downtown Vancouver and Shaughnessy are a far cry from Ladysmith, on Vancouver Island. The picturesque town has a population of about 8,900 and starting in January, homeowners in that community will have to file for exemptions to the tax along with residents in five other jurisdictions.

“It’s gotten pretty out of hand,” homeowner Cal Noonan told CTV News, describing a tripling in his home’s value in five years. “(Unaffordability) has kid of drifted over from the mainland.”

Another Ladysmith resident, Guido Weisz, said that’s exactly why the tax is needed, because even that market has gotten “tough to get into” and “we need to make sure those people who need a home have a home.”

That would be music to the ears of the finance minister, who emphasized the importance of keeping speculators from hopping from one exempt community to another, leaving a cascade of unaffordable homes in their wake.

But Selina Robinson also couldn’t articulate why resort and vacation communities, including Tofino, the Gulf Islands and Whistler, were exempt when they’re struggling to find homes for those living and working to support tourism and other sectors of the economy. 

“Resort communities have a slightly different challenge and role to play in our province,” she replied vaguely to a direct question on the issue. “We're taking an incremental approach to see where else this tax can be helpful.”

It’s certainly helpful for a government laser-focussed on optics to avoid annoying or angering the 99 per cent. But that paints them into a corner: some 20,000 units are on the rental market and $231 million in government coffers due to the speculation and vacancy tax, but what else could they possibly do to have that kind of result without pushback? 

“This isn't anywhere near what it's going to take to solve the housing crisis and what it's going to take is an enormous amount of new supply that is not for increasing wealth for people, it is about supply for people to live in,” insisted BC Green Party leader, Sonia Furstenau. “We can't cordon off certain parts of the province and say, 'Oh well, we're not going to make that a priority for housing' because every part of the province has a housing crisis, every part of this province has an employment crisis because people can't find places to live.”

The tax failed in its promise to control housing prices, but experts don’t doubt its prompted owners of multiple properties to put at least some of some of them up for rent, and reconsider selling or renting the rest. They also point out targeting short-term rentals, taxation policies for multiple property owners, financing policies, and increasing supply will likely be effective strategies, even if they’re more politically fraught.

“In a province as big and diverse in terms of housing, as B.C., it's going to require different types of policies,” said Andy Yan, Director of Simon Fraser University’s City Program. “The kind of challenges differ a lot from what happens in the Lower Mainland versus the north coast versus the Interior.”

While she repeatedly described using “every tool in the toolkit” to achieve affordability, Robinson may want to consider the problem in a new way.

During the pandemic, epidemiologists described COVID-19 public health measures as the “Swiss cheese model”, where masks, combined with distancing, combined with good ventilation, combined with vaccination, overlapped and mitigated different infection routes to better protect each person. The more layers of cheese, the less chances the holes line up and something can get through. 

Similarly, when it comes to affordability and housing policy, it’ll likely take many policies and approaches to curb speculation, get more homes open for rent or sale, and establish a tax structure and expectation that housing should be prioritized as a place to live, maybe work, and feel safe with our families, rather than cash cows to be flipped, traded and commodified.