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Easing BC’s Housing Crunch: Where the Parties Stand

From tax credits to renter rebates, parties unveil strategies to increase affordability.

By Christopher Cheung and Katie Hyslop 14 Apr 2017 | TheTyee.ca

Christopher Cheung and Katie Hyslop report on affordable housing for the Housing Fix. 2016-17 funders of the Housing Fix are Vancity Credit Union, Catherine Donnelly Foundation and the Real Estate Foundation of B.C., in collaboration with Columbia Institute. Funders of special solutions reporting projects neither influence nor endorse the particular content of our reporting. Other publications wishing to publish this article or other Housing Fix articles, please contact editor Chris Wood here.

[Editor's note: Who will earn your vote? Candidates debate Greater Vancouver’s housing crisis and their parties’ plans on April 26. David Eby, NDP; Sam Sullivan, BC Liberal; David Wong, Green. Admission is free, 5 p.m., UBC Robson Square. Media sponsor: The Tyee. Moderated by David Beers. To reserve a seat, click here .]

With high home prices, few available rentals and rising homelessness, housing is a hot election issue this year in British Columbia.

“We do feel it’s a top concern of people across the province,” said Kristi Rivait, the co-executive director of Ready to Rent BC, a nonpartisan not-for-profit that offers housing education and homelessness prevention programs. “We know the crisis has been inflated in urban areas, but we’re hearing it in communities across B.C.”

Election platforms were rolled out this week as the official campaign began, with less than a month to go until election day on May 9. Here’s where the parties stand on housing.

Much of the BC Liberals’ 129-page platform — released April 10, one day before the election campaign launched — focused on party accomplishments from their time in power. The housing section highlighted their foreign buyers tax for Metro Vancouver, as well as reduced taxes for principal residences for some homeowners and on the purchase of new homes under $750,000.

In their platform, the Liberals say they want to ensure “that the dream of homeownership remains within reach for the middle class.” They plan to expand the B.C. Home Owner Mortgage and Equity (HOME) Partnership program, which provides loans for downpayments on mortgages, and the First Time Home Buyers’ program, which reduces or eliminates property transfer tax.

But Rivait says housing is more than just ownership. “I think that the dream of homeownership is becoming a distant dream, even a nightmare,” she said.

“I think it’s time for the rental option to step out of homeownership’s shadow... It’s time to start shifting to those conversations of looking at rental as a long-term, financially secure way of having a home.”

Owners or renters?

NDP leader John Horgan announced an annual $400 rebate per renter household on April 12.

“If homeowners can have a homeowner grant, renters should be able to have a grant as well,” he said while campaigning in downtown Vancouver.

Liberal leader Christy Clark was quick to attack the idea, saying that a person renting a downtown Vancouver penthouse for thousands of dollars would be able to get the same subsidy as renters in need.

“That isn’t right,” Clark said at a campaign event. “We shouldn’t be redistributing our tax money to the very rich. We should be making sure that we spend our resources supporting people who are having trouble staying in their homes.”

Some critics on Twitter, including a professor at the University of British Columbia, said Clark’s argument was weak considering how many breaks and grants her party is giving homeowners, who are richer in Canada than renters.

To help create rental stock, Liberal candidate Rich Coleman, the former minister responsible for housing, said his party would expand the Home Renovation Tax Credit to $20,000 so that owners can add a rental suite to their home.

At a housing forum hosted by the Real Estate Board of Greater Vancouver, NDP candidate David Eby called it a “dumb” idea, calling for an increased supply of affordable housing. (Eby was the NDP’s housing critic and frequently clashed with Coleman.)

Also in the NDP platform is the plan to build 114,000 affordable rental, non-profit, co-op and purchasable housing units through partnerships over 10 years and a two-per-cent tax on empty housing tax that will go towards affordable housing.

If elected, both the NDP and the Greens promise to crack down on landlords who have been taking advantage of fixed-term leases to increase tenants’ rents beyond the normal allowable limits, a problem that Coleman said was complicated to fix and would require further review.

“That’s the biggest issue for us,” said Andrew Sakamoto of B.C.’s Tenant Resource and Advisory Centre, which focuses on the legal aspects of tenancy. “We’ve seen a rise this past year of tenants pressured out of their housing through, for instance, bad faith evictions.”

Do we need a provincial housing plan?

In their ambitious platform, the Greens plan to spend nearly a billion dollars every year to create new housing and maintain existing affordable housing. But the party expects to take in hundreds of millions through increased home ownership-related taxes to help cool the real estate market.

The Greens pledge annual investments of up to $750 million towards building 4,000 new units of affordable housing a year. Another $100 million is earmarked for retrofits and upgrades to existing social housing units.

The party expects to partner with the federal government to meet their new unit target and will work with all levels of government to identify public lands for housing. They say they’ll assist anyone developing low-income housing in adding more units and change zoning laws to allow for more density, revitalized neighbourhoods and the creation of “complete communities” where walking, cycling and public transit get residents everywhere they need to go.

All of this will be encompassed in a provincial housing plan to create more affordable rental supply, developed in collaboration with federal and local governments and housing providers.

“In a province as wealthy as ours, there’s no reason why everyone does not have a roof over their heads,” said party leader Andrew Weaver. “Yet we have thousands who are spending more than half of their income on accommodation, a growing number of homeless people and many middle income families can only dream of owning a home.”

This echoes a BC Non-Profit Housing Association demand for a provincial housing plan.

“For a long time we’ve had these stop-gap measures within the housing system, so we’re kind of plugging holes as they appear,” said Jill Atkey, the BC Non-Profit Housing Association’s director of research and education, “without addressing the housing system as an actual system and coming up with a plan to ensure affordability for a broad range of household types.”

In turn, the Greens claim their proposed efforts to reduce speculation and foreign investment in the B.C. housing market would rake in $600 to $900 million in annual tax revenue.

Despite calling the foreign buyers tax “too little, too late,” Weaver’s Greens promise to double the tax to 30 per cent and make it applicable across B.C.  

Other tax initiatives include taxing lifetime capital gains on primary residences in excess of $750,000, shifting the property transfer tax to a sliding scale with a maximum of 12 per cent on houses $3 million and more, a new “speculation” property transfer tax and revised transfer tax rules to prevent holding companies from being used to avoid taxes.

The party promises to work with the federal government to protect recent homebuyers from their “market cooling initiatives,” as well as on eradicating money laundering and global speculation in B.C.’s housing market.

Atkey says whoever forms government next needs to have that market cooling protection, especially for those who bought in the last five years or so.

“If you bring prices down so much, [homeowners will] find themselves in a negative equity position, and then they’re really stuck,” she said. “That hurts their ability to move for employment.”

Non-profit housing providers could also be stung by an increase in property transfer taxes. “If a non-profit is moving a building — shutting its doors, but transferring its stock to another provider, those hundreds and hundreds of thousands of dollars paid in property tax impact rents directly,” Atkey said.

The Greens say they will transform the Liberals’ Home Ownership Grant into an income-based grant, though the change won’t take place until 2019.

The party also isn’t touching the current budgets for rental supplements. Nor are they offering any new programs or money for renters priced out of the market, like the NDP’s renter’s grant.  

The Greens also plan to end renovictions and demovictions, and allow BC Housing to directly manage private rentals.

These changes could mean stronger security of tenure for renters, which Atkey says is missing.

“When you’re a renter and you don’t know where you’re going to be living next month, let alone next year,” she said, “that’s a difficult situation for anyone to be in. But certainly if you’re trying to raise young kids who are attached to schools, that uncertainty is part of what’s driving people outside of large urban centres.”  [Tyee]

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