Surging real estate makes $2.3M for B.C. cabinet as affordability worsens
Surging real estate values added $2.3 million to B.C. cabinet ministers’ personal wealth this year alone, as the government says coming measures to ease housing affordability won’t include any that lower prices.
One minister saw her four properties jump $765,000, more than five times a minister’s salary. Another saw gains on a portfolio of eight homes. On average, ministers made $103,000 – more than an MLA’s salary, according to a review of public records by CTV News.
It’s natural for those ministers to welcome their own wealth boost, but they have to realize how their eye-popping gains translate into tremendous hardship for young people trying to get into the notorious Vancouver property market, said UBC professor Paul Kershaw.
“We can’t start with the presumption that housing price increases are a good thing. Housing prices that have outpaced incomes is remarkably bad news. It’s turned Vancouver into a generational ghost town,” Kershaw said, referring to how hard it is for young people to buy in neighbourhoods where they grew up.
“Public officials need to be able to wear multiple hats and need to think about this. Some of these gains are crushing others,” said Kershaw.
Data from B.C. Assessment show a staggering surge in assessed values all over the province, with growth as high as 30 per cent in some areas.
It’s added $90 billion in wealth across the province since last year, but has also pushed up down payments and added hundreds of dollars a month in mortgage payments to anyone who wants in.
On Monday the Vancouver market was called the third most unaffordable market in the world, higher than even London and New York, according to a Demographia survey of prices to incomes.
That’s a problem our legislators largely don’t have to deal with.
A review of disclosure documents by CTV News shows that of 83 sitting MLAs, all but three own property, or about 96 per cent. Statistics Canada says about 70 per cent of Canadians own their own homes.
Twenty-one MLAs own a second Victoria home, and 37 own recreational or investment properties. At least seven declared rental income.
The cabinet member whose equity rose the most was Justice Minister Suzanne Anton. She and her husband own four properties whose value rose $765,000 this year to just over $5 million.
Advanced Education Minister Andrew Wilkinson’s home rose $578,000 to $3.7 million, while International Trade Minister Teresa Wat’s two homes rose $365,000 to $1.8 million. Premier Christy Clark’s property rose $160,000 to $1.73 million.
Finance Minister Mike De Jong, who is in charge of affordability measures promised in the upcoming budget, owns or has a stake in eight properties, many apartments in Abbotsford, whose value rose some $2300 to $1.2 million.
While nearly every minister owning in the Lower Mainland saw gains, in other parts of the province some had losses. Public Safety Minister Mike Morris saw his home’s value drop $20,000 to $356,000. And Transportation Minister Todd Stone saw his home’s value drop $14,000 to $728,000.
None of those ministers returned calls for this story. The total wealth the B.C. cabinet declared in real estate is $27.8 million.
On the NDP side, the largest increase appeared to be TransLink critic George Heyman, whose three properties rose $133,000 to $1.8 million. NDP Leader John Horgan’s Langford home rose $7,000 to $376,000.
Reached at a press conference Friday, Housing Minister Rich Coleman, whose Langley home increased $35,000 in value to $664,000, said that the personal portfolios don’t impact the decisions made in cabinet.
“They don’t come into account at the table,” he said. “I don’t think I should apologize for owning a house. The challenges in this marketplace have been there for decades.”
He said the cabinet has worked out housing affordability measures that will be made public as the budget is unveiled in February.
Only three MLAs don’t own property, according to disclosures: Liberal MLA and former Vancouver Mayor Sam Sullivan, NDP MLA Mable Elmore, and former NDP leader Adrian Dix.
Sullivan didn’t return calls, though Dix said that he was surprised to find out he was in such a small minority. Dix said he has owned property in the past but has rented for the past 13 years in his riding of Vancouver Kingsway.
He said he doesn’t think that owning property while regulating property is a conflict of interest, but he does feel the government should be doing more to tackle housing affordability.
“On this issue the government has been out of touch for more than a decade. We can intellectually discuss why but they have been. And they have to get in the game,” he said.
B.C.’s conflict of interest commissioner, Paul Fraser, told CTV News that no conflict exists if a large portion of citizens would also face such a conflict. CTV News phoned back to ask if that exclusion would apply to people owning many properties with millions invested, but didn’t hear back.
To help cool off the region’s red hot real estate market, Vancouver’s mayor has called for a speculation or luxury tax. Last week, a group of UBC economists proposed a fund to combat housing affordability by taxing homes whose owners don’t have ties to the B.C. economy.
At a press conference Monday, the premier said she’s not interested in any measure that would lower prices.
“Everybody who owns a home doesn’t want government to go in and make that home less valuable,” Clark said. “Most people have a mortgage on that home.”
“There are lots of things we can be doing that don’t hurt existing homeowners,” she added, saying she wants to see increased supply of new homes to buy.
“Supply and demand has a big impact on that as well. We’re thinking on what we can do and you’ll see more on that in the budget."
But some families doubted those measures would make a difference.
Tracy and Rodney Cooper said they bought a Yaletown one-bedroom condo years ago, and assumed they were getting on the property ladder.
But two years ago they had a child and needed a bigger place. They couldn’t afford down payments for a larger home, even by selling the condo, so ended up renting a new place while renting out their condo.
“We own but we’re renting right now. It’s ridiculous. Prices are ridiculous,” said Tracy Cooper. “It’s out of reach.”
She said owning expensive properties while regulating the property market sounded like a conflict of interest to her.
“They don’t know what it’s like to be regular middle class people,” she said.