2016 Legislative Session: Fifth Session, 40th Parliament
HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

official report of

Debates of the Legislative Assembly

(hansard)

Tuesday, July 26, 2016

Afternoon Sitting

Volume 40, Number 10

ISSN 0709-1281 (Print)
ISSN 1499-2175 (Online)

TUESDAY, JULY 26, 2016

The House met at 1:32 p.m.

[Madame Speaker in the chair.]

Orders of the Day

Hon. R. Coleman: I call continued second reading of Bill 28.

Second Reading of Bills

BILL 28 — MISCELLANEOUS STATUTES
(HOUSING PRIORITY INITIATIVES)
AMENDMENT ACT, 2016

(continued)

D. Eby: We’ve come a long way in terms of the government’s position on the housing market in Metro Vancouver.

[R. Lee in the chair.]

I think there’s really not a quote that sums up this shift more dramatically than a quote from the Housing Minister in May of 2016 to Vancouver. He’s talking about the housing issue. “I guess some people just have to get up and whine every day. I don’t know. You just have to look at it. The glass is half full, not half empty, right?”

Interjection.

D. Eby: The Housing Minister is taking exception. Maybe I can bring him to another one of his quotes about the need to collect statistics. “We don’t need to collect statistics,” says the Housing Minister. “We’ve worked with the real estate guys for years and have got data on sales.”

Then again from the Housing Minister on housing prices in Vancouver, the same year it was found to be the least affordable city in the world when local incomes were looked at. What did the Minister for Housing say? He said housing prices in Vancouver were “actually pretty reasonable.” That was his opinion.

Here we are, just a few months later, where our Housing Minister was insisting everything is just fine. Our Finance Minister is saying no, it’s like six families who he knows who have made the decision to buy a house for their student going to Vancouver Film School. And what happens today? Well, the Finance Minister drops another set of data, an additional set of data to his very strange 14-day set of data. We were all: “Well, that was really strange — 14 days. That was an unusual release of data.”

Interjections.

Deputy Speaker: Order in the House, please.

[1335]

D. Eby: It didn’t include the end of the month, the busiest time for real estate closings.

Now we get the end-of-the-month data. Now we understand the government’s panic. Now we understand why we’re here for the emergency session. The numbers are double what the government originally presented to us. With all the problems with their data collection — collecting data on international people instead of international money itself — clearly, they realized they were in trouble. So here we are today, a 180-degree turn from where we were with this government just a few short weeks ago.

I’m going to address all three parts of this bill that has been brought before us, that the government hopes will stop the opposition from continually pointing out they could care less about Metro Vancouver housing affordability. They had to be dragged here kicking and screaming.

First, I want to point out a few things. If it wasn’t for the official opposition raising this issue day after day — issues of corruption in the real estate industry — the stories that hard-working journalists like Kathy Tomlinson of the Globe and Mail brought forward in her efforts to uncover shadow flipping, the families affected by fraud who came forward, the realtors who came to my office to provide information about what they saw that was taking place, we would not have seen the reform in this industry that we are seeing as a result of the efforts of those people who came forward. I want to thank them very much for believing that they could see reform, that there could be change if they spoke out and if they investigated. I am greatly appreciative of that.

How did we get to those kinds of profound issues in the real estate industry, that the industry actually lost self-regulation, that the government took that away from them after facing this incredible pressure? The government systematically underfunded FICOM. What is FICOM? FICOM is the umbrella organization that includes the superintendent of real estate. The credit unions, the real estate agents, the pensions pay money into FICOM to pay for their own regulation.

What does the government do with this money? Do they take it and put the money into auditors, into investigators to police the real estate industry to make sure that everything is ticking along just fine in the credit unions and the pensions and so on? No, $3 million a year, the Finance Minister told me during estimates, is clawed back from that money into general revenue for the government. So $3 million that was paid by industry for regulation did not go to regulation but was instead taken as an additional tax by this government from industry.

No wonder we ended up in this situation, where the very agency responsible for overseeing the real estate industry was systematically underfunded by this government clawing back that money. Oh, awfully quiet now
[ Page 13388 ]
over there. Systematically clawing back the money that the industry paid to ensure that there was proper regulation.

I can tell you about the impact of the government’s decision. It’s that people in my constituency have unlicensed real estate agents dropping off letters at their homes almost every day — “I am not a real estate agent. I would like to buy and sell your home” — and taking advantage of seniors. The largest real estate firm in Metro Vancouver was caught on tape training real estate agents in how to defraud their clients — astounding. Real estate agents dig through the trash can at that same realtor’s office looking for stolen lawn signs. That is the state of the industry that this government brought us to. They want to be patted on the back for trying to get it back under control.

It was this government’s failures that brought us to this place — systematically underfunding the regulator, deregulating without supervision. Where did that $3 million go? Maybe it went to private jet flights. It sure didn’t go into auditors.

I think it’s important to note that for all of those hard-working realtors, many of whom came to my office to thank the opposition for their work on this file — and all my colleagues, thank you…. I think for those realtors to know that this government let this activity go on year after year by underfunding the regulator is an extra bitter pill to swallow. They fought hard for self-regulation. Many of those realtors conducted themselves ethically. They are of the firm belief, which I believe is correct, that there are some bad apples out there who ruined it for everybody. It was this government who enabled that situation.

[1340]

Now this law takes away self-regulation from them. Okay. I guess that’s a response. But let’s ask the question about what’s happening in New Coast Realty, a firm that was brazen enough to advertise that if you were a seller that wanted to sell to corrupt officials from China, they were the best agency to approach.

What’s happened there? Well, now they’re actually training real estate agents. They’re now a school for real estate agents. This is the same real estate agency that was caught on tape training the realtors how to defraud clients. Now they have a school for realtors. That’s this government’s action on the file. That’s where we are right now — running realtor schools. It’s astounding. It’s not fair to say nothing has changed. They’ve found a new type of business to train up the real estate agents of tomorrow. I’m sure the government is as enthusiastic about that as I am.

The government says this bill will help with that. But, to be blunt, the existing rules prohibited all of the conduct that that agency was engaging in. The existing rules already prohibited it. It was the failure to enforce the rules. It was the underfunding of the regulator.

I heard the Finance Minister say that he’s going to dedicate money to additional auditors. Well, I’ll believe that when I see it.

I bring issues to this House. The Leader of the Opposition brings issues to this House — allegations of money laundering in our real estate market. We can’t figure out who’s responsible for investigating that. The province doesn’t know who’s responsible for investigating that. Investigative reporter Sam Cooper doesn’t know. He went to six different agencies to ask who is responsible for investigating SunCom — couldn’t find an answer.

The Finance Minister says: “Well, maybe it’s time to bring on a couple more auditors to police our new bill.” Well, that would be a fantastic idea.

The second part of this bill is the city of Vancouver’s vacancy tax. I want to take a moment to reflect on the fact and to thank the city of Vancouver — fed up, like everybody, of this province not taking action — for standing up and saying: “If this province doesn’t take action, we’re going to go it alone because we can’t wait any longer, and here’s the thing we think we can do on our own.” It forced the province into action, forced us into this sitting here, and I want to thank them for doing that.

I had to listen, the Leader of the Opposition had to listen, and my colleague from Victoria–Beacon Hill had to listen to this Finance Minister and this Premier day after day. “There’s no vacant home problem. The data has shown this thing was all made up. It’s not a real issue. We’ve got the data now.” Except the data showed there was a real issue — 10,000 vacant condos in the city of Vancouver. The Finance Minister: “Oh, I don’t know.”

So now here we are, like in some weird parallel universe, and the Finance Minister brings forward legislation for vacant homes that he said weren’t an issue in the city of Vancouver, legislation to deal with this problem that he says he thinks is going help increase the rental housing stock. Well, it’s wonderful, again, to have him join this conversation a year late and with some really unusual ways to deal with it. I’ll get into that.

Let’s talk about this provision that’s put forward for the city of Vancouver’s vacancy tax. First of all, clearly, we have a regional issue. His own statistics today show that this is a regional issue in Metro Vancouver, spreading over to the south Island. We get a solution for one municipality. The reason? The reason, he says, is he wants consensus from the UBCM before he’ll move forward on other areas of the province.

This is enabling legislation. Any municipality that wants to do this, if you’re enabling them, if you’re giving them the power to do it, could do it, or they could choose not to do it. It’s up to them. Why would you enable the city of Vancouver alone but not enable other cities in the Lower Mainland or across the province or in the south Island to do the exact same thing? If it’s such a great idea, enable everybody to do it and let them decide for themselves. It’s a very unusual objection.

I think it would be really helpful to read a section of the bill particularly related to this vacant property proposal to really get a sense about how difficult this will be to implement.
[ Page 13389 ]

[1345]

Section 621 creates a new power for the city of Vancouver inspectors to “enter onto a residential property…for the purpose of determining the status of the property and whether the property is subject to the vacancy tax.”

Let’s just take a second here and think about this. We’re empowering the city of Vancouver inspectors to enter property to determine whether or not it’s vacant. So what do you suppose that the inspectors should be looking for when they’re entering onto a property to look for whether or not it’s vacant? I don’t know. I think that’s a fair question to ask.

Also, is the mechanism that’s proposed here to deal with this issue…? Is it proportionate to the issue that we face, and is there a better way to do it? Is there a better way than sending a city inspector onto someone’s property to — I don’t know what — look in the windows to determine whether it’s vacant? Is there a better way to do that? Oh yes, there is. Yes, there is.

There’s a proposal that has come forward — Sauder School of Business — endorsed by 40 economists who used the income tax system to determine whether a property is vacant. You’ve got the homeowner grant application as a primary residence. You’ve got declared rents received for renting out the place. If it’s a secondary residence and there are no rents, you don’t need to send someone to look in the windows. It’s pretty straightforward. And yet, this is the mechanism that the province brings forward to us — city inspectors looking in people’s windows to see whether or not their homes are vacant.

Now, if this were the first time this had been tried around the world, I would understand that maybe you’ve got to take a shot to do something. You’ve got to try something. But the city of Paris did this, and it didn’t work, because it’s easy to evade this kind of tax if you’re not using the income tax system.

I think it’s important to understand the context of the vacant condos. You’ve got the head of the largest investment firm in the world, Laurence Fink, the head of BlackRock, telling the world’s investors to buy Vancouver condos. Years ago he gave this advice. This legislation that comes forward to us today does absolutely nothing to tax any of the international money already in our housing market — absolutely nothing.

I heard the Finance Minister say: “Oh well, I look forward to hearing how your 2 percent tax proposal stacks up against our 15 percent tax proposal.” Well, fair enough. If the minister wants to have a conversation about tax levels, if his main objection to our proposal is that the tax is too low, let’s have a conversation about that. But the taxes work very differently.

The tax that we’ve proposed taxes all the money that’s already in our real estate market. If you are not paying your worldwide tax in B.C., you have to pay this tax if you own property. It’s very straightforward. Now, for the minister’s proposal, it starts on August 3. So for everybody who’s in before August 3, there’s no new tax. It doesn’t deal with it at all.

To pretend a 15 percent tax is more significant when it doesn’t deal with the 10,000-plus vacant condos linked to international investors like Laurence Fink…. I think it’s fair to say this measure doesn’t go where it needs to go, which is to follow international money, including the money that’s already in our housing market.

Again and again in his speech, the minister referred to international capital, but the bill in front of us does not talk about international capital. It talks about international people. It is going to capture people in the immigration process who have moved to Metro Vancouver, who are starting a life, who are paying taxes, who are working, who are not citizens, and it will not capture any of the international speculators who have dumped money into Metro Vancouver with impunity for years.

Let’s talk about the advantages of the proposal the government didn’t choose, which actually looks at international capital. It doesn’t look at international people. When you use the income tax system to say, “Are you paying your worldwide taxes here?” instead of saying, “What’s your citizenship status?” then you have an incidental effect of catching domestic laundering.

We’ve got a huge drug problem, a drug war that we’re dealing with in Surrey, street violence, fighting over the proceeds of the drug trade. Where are those proceeds going? FINTRAC tells us that our real estate market is particularly vulnerable to money laundering. We could catch domestic money laundering in our housing market if we used the income tax system and linked it up to real estate transactions.

[1350]

We could catch international money laundering. A story in the newspaper on Sunday, Sam Cooper, allegations linking SunCom — a B.C. Liberal donor — to a huge fraud in China. Half a billion dollars in residential real estate transactions associated with that would also be captured by this measure.

You would actually catch international capital, regardless of whether it was a Canadian or a permanent resident or — the government’s preferred term — a foreign national. It doesn’t matter who’s spending it. The impact is the same on our housing market. You would capture all of that money, not just some of it, depending on who spends it.

It would send a message of welcome to all of the immigrants who come to our community to work here and participate in our economy and pay taxes here, because they would be exempt from the tax regardless of their citizenship status. If you’re here on a work permit, we’ve probably recruited you because you’re such a highly skilled worker, and this government wants to put an additional tax.

Now, importantly, this tax does not privilege people who spend $800,000 loaning money to the government
[ Page 13390 ]
of Quebec to buy a permanent residence. It privileges the people who wait in the immigration queue and are working in our community and paying taxes here. The government would exempt that kind of activity from their tax.

It catches all of the money that’s already in the housing market. The government’s proposal doesn’t catch one dollar that’s already been put into our housing market by international speculators, so all those vacant condos — not captured by the government’s tax. The tax that we’ve proposed is collected annually. It’s not a one-time tax. It could easily be seen as the cost of doing business.

Let’s be honest about what’s been happening in the housing market — appreciating 10, 15, 20 percent; Tsawwassen, 100 percent. So this 15 percent tax is less than the depreciation in our currency in the last couple of years. At best, we’re in the same situation, in terms of affordability for international buyers, as we were a few years ago.

Our proposal also allows other communities to opt in. This proposal focuses on Metro Vancouver, even though we know on the south Island you’re already starting to see significant activity. What this is going to do — if it works exactly the way the government thinks it’s going to work — is displace that money directly into the south Island. I’m not sure why the government would do that.

It’s profoundly ironic that we had to listen to the Finance Minister extol the virtues of this proposal as somehow rolling out the welcome mat to the world when in fact it does the complete opposite. It says that if you’re a foreign national, we’re going to tax you no matter what you’re doing. That’s a very different message than the message: “It doesn’t matter who you are. It matters what you do.”

Now, there are a couple of major loopholes in this. The first is that as a Canadian, I could set up a company, fully capitalized with international money, buy up as many homes as I want in Metro Vancouver and not pay a cent of tax. It seems to be a pretty serious issue, especially in light of the reports related to SunCom — crowdfunded real estate, money from serious allegations of international corruption.

Another loophole. If I buy up all the presale condos in a particular building or a floor or just a couple of units, and then sell them like concert tickets or hockey tickets for a markup — totally exempted from this tax. There’s a very live question about whether large rental buildings are exempted from this tax. You have a multi-unit rental building, which is not classified as residential for the purposes of this act. I’m going to be asking the minister about that during the committee stage.

[1355]

I think one of the important things to note…. Obviously, I have some profound issues with what the government has put in front of us today, but I’ve got to say, it’s better than nothing. It’s better than nothing, and it’s better than dealing with a government that refuses to acknowledge that there’s an issue, day after day, when you start to wonder whether the speaking notes can defy reality. Clearly they can’t. Clearly even this government had to acknowledge that there was a serious issue.

We are in an election year, after all, so I am very glad, first of all, to see that we’re actually having a conversation about what’s happening in our housing market and that we’re past the denial and we’re past the obfuscation and the political attacks and all the garbage that we had to deal with to get here.

But again, I have to emphasize, because this is critically important, that the issue is not international people. The issue is international money. This government’s target of international people is completely the wrong target.

We’ll get no explanation of how people are buying million-dollar homes with poverty-level incomes with this proposal. We’ll get no task force to chase allegations of money laundering and tax evasion in our housing market with this proposal. We won’t get even what the Finance Minister was talking about in his speech. This doesn’t address supply. This doesn’t address transit. He likes talking about it, but I’m still waiting for that big announcement about all that affordable housing supply for Metro Vancouver.

This government’s law is good for a headline, and it’s a good start to start the conversation. Finally, they’re admitting we have a serious problem, so welcome to the conversation.

I’ll be supporting the bill for what it is, but we’ll be putting forward amendments to try to fix it. I’m going to be blunt. When the government made light of our concerns, when they made jokes about our concerns, when they denied that our concerns were real…. Here we are today with them acknowledging that it’s a serious issue. I have a feeling that if they don’t take our advice seriously today, we’ll be back here in six months again.

Interjections.

D. Eby: Oh, four months. We’ll be back here again with the government trying to fix what they’ve done here.

Interjection.

D. Eby: I’m sure the member from Shaughnessy would love to go back to his constituents and assure them how lightly he takes the issue of international money in the housing market. I would like him to put that on a flyer and drop that at the doorstep of every one of his constituents, who are incredibly annoyed that their MLA has been absent on this issue for so long.

You know how I know that, hon. Speaker? Because they come to my office to tell me that they wish that this government took the issue of international money in our housing market seriously.

Hon. Speaker, thank you very much for the
[ Page 13391 ]
opportunity to address the bill, and thank you very much for the opportunity for us to finally have a serious conversation about this serious issue.

Hon. P. Fassbender: I’m delighted to rise and speak to Bill 28 today. I appreciate that the member from Point Grey probably sees himself as the next leader-in-waiting after the next election. But I can also say that we as the government are committed to ensuring that we do everything we can to deal with issues on housing affordability and access to housing. I know clearly that it isn’t a simplistic issue. There are many aspects to it.

[1400]

The member for Vancouver–Point Grey spoke about the fact that we have not talked about transit in this discussion. Well, actually, no. We took action on transit by putting $130 million recently on the table to ensure that the $370 million from the federal government could be invested in Metro Vancouver to provide transit that will help to populate the supply that we need in the region, to provide housing to people along transit corridors and to ensure that by providing that supply, we make housing more affordable for British Columbians who choose to live in this great province and in the region of Metro Vancouver.

I take a bit of offence when the member also spoke about the fact that we’ve done nothing on housing affordability. The Minister for Housing has made a number of announcements with the Premier — $350 million invested in low-cost housing to meet the needs of those people in the region, and particularly in the city of Vancouver, who need housing.

We’ve done that by investing additional dollars to provide the impetus to work with the industry, to work with non-profit organizations, to provide affordable and low-cost housing. That is a significant commitment to the region and to the city of Vancouver.

The province and the Premier have said repeatedly that we are going to make every effort we can on a number of fronts — not just on one, but a number of fronts — to ensure that that dream of owning a home is reality for young people in our communities. The honest review of that says that millennials’ view of what a home means is quite different than it was for my wife and myself and our parents.

We clearly see that Vancouver is a city — as is the city of Surrey, as is the city of Coquitlam, as is the city of Port Moody, and Port Coquitlam. They are communities that people want to live in. They’re moving into communities that have jobs, that have a future for their children, that have great education programs.

That is because we’ve continued to build an economy in this province — not only in Metro Vancouver, but throughout the province — that provides hope for millennials and for their future and the future generations. The results of that are very obvious by the fact that we’re leading the country in terms of our economic growth and the forecast for the coming years.

I believe that the people of British Columbia, when they see what this government has done, is doing and is committed to continuing to do, will see that we are about action — not empty words, not empty promises that we hear from the opposition, but action that has delivered results, month in, month out, and over the time this government has been honoured to serve the people of British Columbia.

I do want to speak a little bit about the issue of transit and affordability and all of those. Last week, on Thursday, Deloitte held a forum in the city of Vancouver and invited a cross-section of people from the development industry, from academia, from the finance world, from the real estate industry, from local governments, to come together and to talk about the housing issue, not just in Metro Vancouver but throughout the province.

The message that came out of that was very clear. There is significant opportunity, as a result of the investment that this government has made in transportation in the region, to take advantage of that growth and those opportunities and the lift in property values, to reinvest in transit. We look around the region, and you see what is going to be happening around the Evergreen line when it opens. Already there is development happening as a result of that investment.

[1405]

What was clear from the people at that forum is that the benefit of those transit investments will increase supply, and that supply and some of the profits from that supply should be reinvested into continuing to build the transportation system.

What was also obvious was the message that we heard from the development industry about the challenges they face to keep supply moving because of the time that it does take in some communities to get development proposals through. The Minister of Finance spoke of 108,000 units currently in the pipeline that are waiting for approvals, some much longer than others.

The reality is that if we can work together to open up that pipeline, to bring that supply into the marketplace, we will meet a lot of the needs that we see today, and we will see prices moderate because supply is there. We know there is demand, and there is local demand. The figures that the Finance Minister released today clearly show that the demand in the market by people already in the market is significant.

Yes, the measures that are being introduced in this bill will help to deal with some of the foreign investment by foreign nationals. We’re not picking a jurisdiction or a country. We’re looking across the board in terms of that investment, as other jurisdictions around the world have done. They have imposed this kind of a tax for foreign nationals who are not residents, who do not have landed immigrant status, who are not residents of that particular jurisdiction. That is why we’re doing what we are doing today.
[ Page 13392 ]

We clearly know there are effects from this tax. Many of us have already heard feedback from the real estate industry and others who question whether or not this is the right approach. But we are committed to taking this first step, along with the other steps that we are taking — in transit, in other areas of supply management — to ensure that it is a comprehensive look, not a one-off, at what it is going to take to deal with the issues that we face.

We also want to make sure, by increasing the supply, that for people who are in a position to rent and want to find a home, there is incentive for the development community, by speeding up the process so that they can get that supply on the market — and again, that that can be around the transit corridors, not just the rapid transit corridors, but a regionwide approach to it as well.

I know that when the Minister of Finance met with the mayor of Vancouver, they had a very open and a frank discussion about the measures that the mayor and the city council in Vancouver wanted and they wanted to focus on. It was the city of Vancouver that pushed, for quite a while, about taking a look at this. When the minister met, he said: “We will provide you, by opening up the Vancouver Charter, the opportunity to implement what you have said you want, but you will be responsible for the criteria and the details and how that is going to be administered.”

That goes to the heart of what we as government do in our relationship with local governments: provide them with the tools they need to make the decisions that should rest within their jurisdictions so that they can move ahead, based on how they want to approach that. And they will be accountable for the measures they put in place to the people who they serve in their jurisdiction.

In that meeting, the minister said: “We will move quickly.” It is important, within the time frame of budget cycles and the other things that the city of Vancouver does, that we would move quickly. That’s why this House is sitting, to meet what Vancouver had asked for and giving them those tools.

[1410]

The other measures in the bill are other components of that integrated plan I mentioned that we are committed to moving forward on. We will continue to look in the future, as we gain more information, as the minister released today….

I find it interesting, again, that the member from Point Grey — who stood in this House and said, “Why doesn’t the government take action?” — now criticizes us for taking the action, saying that it’s not enough and that we should be doing more. Again, this government is committed to taking measured and well-founded steps, based on good research, to make the right moves for the right reason. That is why this bill is in front of the House.

In my role in the ministry that I’m honoured to serve, I’ve had a number of calls from other local government officials from throughout the province, and there are a variety of viewpoints as to what measures they would like to see put in place.

The member opposite spoke about the capital regional district. I spoke with the mayor of Victoria, whose focus for me was the concern that they may have a similar problem but also other concerns about derelict properties that they have in her jurisdiction and wondering if there wasn’t a way that we could look at that as part of measures moving forward.

What I said to the mayor is: “I would hope that you and your colleagues throughout the province will watch what happens in Vancouver and will also, at the Union of B.C. Municipalities meeting in September, bring forward ideas that you as local governments would like to see.” Again, that is a recognition of the importance for them to look carefully at what they would like to do in their jurisdictions. The learning that will come out of Vancouver’s experience will help to populate that.

That is why, because of the pressure from Vancouver, we are dealing with the Vancouver Charter. We are prepared to enter into those discussions, on an ongoing basis, with other communities throughout the province. If, indeed, changes to the Community Charter are warranted and asked for by local governments through UBCM, then this government will be prepared to take a look at those.

When it comes to the legislation that is before us — it has been said many times, but it bears repeating: this legislation enables, but does not require, Vancouver to impose the vacancy tax that they’ve asked for. They may very well decide that there are implications for what they thought they might like to do and that they perhaps do not want to do. That’s why the legislation is enabling. They can choose how to move that forward, what elements of what they have thought they want to impose, and how they do it.

That will be done through their local bylaws to ensure that there is a process and good communication to all of the residents of Vancouver. The legislation absolutely balances the flexibility in enabling Vancouver, but it also ensures that there is certainty for those people who live in the jurisdiction and who have properties which may not be vacant under the definition and some of the guidelines that are outlined on what the city of Vancouver needs to do.

I also want to make it very clear — because I’ve been asked this question — that the legislation provides the authority. The tax applies only to residential land and improvements and will not apply to properties otherwise exempt from property taxation. That, again, is a clarification that I think is important. Vancouver is also — because of our desire and, I believe, the city of Vancouver’s desire — limited to using the moneys that they receive under this vacancy tax for initiatives that respect affordable housing and for the administration of the tax, of course.

[1415]

Vancouver is going to be responsible for the design details, the implementation, the administration, the collection and the enforcement of the tax. The proposed legislation enables a self-declaration approach. Vancouver may require information from property owners regarding the status of their residential property and seek verifying evidence as to whether or not the property is vacant or occupied. If such information — and it was clearly stated by the Finance Minister — is not provided, Vancouver has the recourse, including considering the property to be vacant and thereby taxable.

In order to support this framework, the legislation also requires or permits Vancouver to cover various matters in its vacancy bylaw, including establishing the length of time for which and the circumstances in which a property is defined as vacant property and establishing exemptions from what would otherwise be considered vacant property — for example, properties in probate or awaiting a demolition permit. All of those things are included.

Determining the basis of the tax, which could be on any other basis related to taxable property, such as by parcel or percentage of assessed value. Also, establishing the rate or the amount of the tax, which may be different for different categories of property or property owners. Establishing the process for the administration and the collection of the tax, which may use existing taxation powers, including tax sale. Defining the type, form and sufficiency of verifying information and evidence that must be provided by a property owner regarding the status of their property.

Then, finally, providing for the preparation of an annual report that includes the amount of moneys raised by the tax and how they were used.

The Minister of Finance spoke about the fact that we have 2.5 million people within the Metro region. It is anticipated — in cities like the city of Surrey and with the growth that’s happening in the northeast sector — that that is going to increase to another million people in the next 20 years.

In order to be able to deal with that growth, this government is absolutely, as I said, committed to working with local governments on transportation initiatives — not just on rapid transit lines, but throughout the region — to ensure that we have the supply of affordable and achievable property and housing that will ensure that young people can find a home and fulfil that dream of home ownership.

We also want to be sure there’s enough supply for rental properties. That, again, is something that we see throughout the region and throughout the province as a challenge. What we are doing here, what we are doing in transportation planning, is going to ensure that we will have the supply that is necessary.

We will continue, as I said, to work with other governments throughout the province of British Columbia. We will analyze the steps that are being taken and the information that comes out of it.

We will continue, as a government — not only in the next coming months, but when we are returned back to this House — to work with local governments, to find solutions for the people of British Columbia that will also honour the fact that we want to see continued investment in the province, to see continued economic growth, to see continued balanced budgets that will also ensure a sound and robust economy for every British Columbian.

We recalled the Legislature to make sure that we move on those things today that we can. I look forward to the members opposite voting in support of this piece of legislation, because it is the right thing to do for the right reasons, and it is only part of our comprehensive economic strategy for the province.

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C. James: It’s my pleasure to rise to speak to Bill 28, the Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act. I want to begin with the title, because I think there’s some irony in the title of this bill, which talks about housing priority initiative act, given that we’ve seen just the opposite, in fact, from this government — just the opposite when it comes to priorities around housing.

We only need to look back to when this government was elected in 2001 to see — whether it’s social housing, whether it’s affordable housing, whether it’s supports for tenants and rental housing, whether it’s building co-op housing — this government has completely neglected the crisis that we’ve seen in British Columbia. They cut programs and services for affordable housing for the most vulnerable in this province.

From 2002, when they began their core review, this government gutted supports for housing and for the most vulnerable. That was the direction that they took.

We are seeing the results of that all across this province. I have seen it right here in my own home community with a tent city that grew up out of a lack of affordable, supported housing in our city.

It was something that they’ve been told by opposition, by social groups, by the homeless, by community organizations, by the incredible not-for-profit sector in this province that works so incredibly hard without supports to be able to try and provide for the most vulnerable, to be able to try and provide for families — and others in our province, seniors — who aren’t able to find housing. That’s the result, again, of what we’ve seen by this government since 2002.

It should be no surprise that we are standing in this House talking about an affordability crisis, talking about a housing crisis when you look at the record of this government.

I want to take my time today to speak about three particular areas. First, I want to talk about the approach that the government has taken on this bill, because it’s an approach and a pattern that we have seen in a number of
[ Page 13394 ]
areas from this government. I think it’s important to put it on the public record, because I think it speaks to a lack of direction and a lack of a thoughtful approach to governing in British Columbia.

Second, I want to talk about the specifics of this bill and talk about what’s in it and what is not.

Third, I’d like to talk about what could have been. I often hear this government saying: “Well, what ideas have you got?” In fact, I want to put forward those ideas that were proposed a number of months ago by our leader and by the official opposition.

In speaking to Bill 28, I want to start with this government’s approach to this legislation. We’ve seen for more than a year, now, that this Premier and this government and the ministers — both the Finance Minister as well as the Housing Minister — have denied and mocked any concerns that have been raised around a crisis in the real estate market and a crisis in housing in British Columbia.

I just want to read a few of these comments, because I think this government often tries to pretend that they are the first to come to a problem and raise the solution that’s there. In fact, this government has done just the opposite.

Back in May 2015 — we’re talking about not this year but last year — the Housing Minister said that if you look at the mean cost of housing across British Columbia or the Lower Mainland and compare it to other cities worldwide, it’s attractive internationally — that it’s actually pretty reasonable compared to other cities across the world. “There’s no initiative at this time in government to go and interfere in the marketplace.” He said they don’t believe in that. “There is no initiative or research that we’re doing from this ministry with regards to that.”

Is that listening to the concerns that came forward? This is a year ago that we were hearing some very valid issues.

What did the Premier say in June of 2015? The Premier said: “There are a lot of great places to live. Fort St. John is booming. It won’t be long before you see lots of new people in Kitimat and Prince Rupert. The views are amazing, by the way.” Scorn to people who are seriously struggling with affordability and trying to provide for their families.

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The people who come forward and talk to us and, I’m sure, talk to government as well — aren’t heard by government, aren’t listened to by government, but who come forward — don’t expect government to do everything for them. These are hard-working families. They’re doing everything right. They’re working. They’re trying to provide for their children. They just can’t manage things.

The answer from this government, when they come forward with those genuine concerns, is: “Well, just move. The views are great somewhere else,” or “We’ll make it more difficult for you. Why don’t we hike your hydro rates? Why don’t we make it more difficult with MSP? Why don’t we make sure tuition is out of reach for you and your families so opportunity doors are closed as well?” That seems to be the approach and the answer that this government takes when genuine, hard-working families are coming forward with real concerns.

In February of this year, 2016 — let’s fast forward; this has been a year of trying to raise these concerns to government — the Minister of Finance says: “We make housing policy, and I know this will, perhaps, shock some people who think a certain part of Vancouver is home. We make policy for all of British Columbia, not just one part. I’m sorry, but we govern for the whole province.”

I’ll come back to the specifics in this bill — in Bill 28, which we’re debating today — that, in fact, only apply to Vancouver, and other parts of the bill that, in fact, only apply to Metro Vancouver, so just the opposite of what the Minister of Finance said.

Finally, I think the topper that describes this government’s attitude when it comes to concerns that come forward came from the Minister for Housing, who said: “I guess some people just have to get up and whine every day. I don’t know. You just have to look at the glass as half full and not half empty, right?”

That kind of attitude has no place in a government that is supposed to represent all of British Columbia. These are genuine worries coming forward from individuals and families — real concerns. Affordability is a real issue. Ignoring and ridiculing people and mocking people is not the way to approach things.

But, and I think this is the most critical piece, when it’s a problem for the Premier — not for families, not for British Columbians, not for individuals who work hard…. When it becomes a problem for the Premier — too many headlines, too many questions in a scrum, maybe a few polls, and oh, an election year this coming year — then the government decides they’d better do something. Then the government decides that they better come forward with something.

Well, I’m sorry. That is a terrible way to run government. That is a terrible way to run government, to decide only to act when it becomes a problem for the Premier, not when it’s a problem for real British Columbians, who this government is supposed to be acting on behalf of.

What does that lead to? It leads to ideas and approaches on the back of a napkin. It leads to policy solutions that are not thought out. It leads to unintended consequences. It leads to a lack of consultation, which means concerns aren’t addressed. It is pretty clear, as I said, that this government isn’t interested in addressing real concerns. They’re only interested in addressing concerns that matter to them, for themselves.

I’m sad to say that it’s not simply the housing issue that this applies to. This is a pattern we see across government. I’m speaking about it because it relates to Bill 28, but in fact, if you take a look at, for example, education, you see exactly the same thing.

Just as the government did with housing, where they
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said there wasn’t a problem, that people should quit whining and they should just be quiet about it, that’s just what they do in education as well. “Oh, school boards and those parents that complain about their kids and not enough money in education — they should just stop complaining. There’s lots of money.” In fact, the Premier said, in the area of education, that there’s low-hanging fruit. “School boards should just go and make efficiencies and make cuts. That’s how they should address it.”

Just as with this housing bill that we’re here debating today, it happens to be an election year this year, so the Premier and the Minister of Education came forward and decided that they’d give some money back to school boards, after saying that school boards had a lot of money. They took credit for giving them their own money back, which is really quite something.

[1430]

It’s quite an accomplishment to stand up and take credit and send out a press release for giving school boards back their own money that they had cut because the government had required it. But that was their argument. “Boards have done such a good job that we think they deserve to be rewarded for that.” Again, as I mentioned with the housing bill, it’s a terrible way to run government.

Just like the housing issue that we’re debating today, this government told school boards there was no problem on school closures. “Get on with closing schools,” they told the school boards. But this year, when it happens to be an election year — I’m sure only a coincidence — they decided that they’d put a fund forward that people could access to be able to keep schools from being closed.

Well, what happened for those school boards over the last three years that closed schools? Just like the housing bill, what happened to all those families who couldn’t afford housing over this last year? Didn’t matter then. It didn’t matter over this last year. It didn’t matter for school boards that were closing schools. It didn’t matter for those families.

Now, when it’s an election year, it matters. “Now it’s an election year. We’d better bring the Legislature back in July. Now it’s an election year. We better make sure that we’ve got a fund put aside to keep those schools from closing.” Wouldn’t want that to happen because it’s a problem for the Premier and the government. They didn’t care when it was a problem for families. They didn’t care when it was a problem for parents and for students. A terrible way to run government.

The pattern from this government is to deny the problem. Slam the real concerns that come forward. Then, when the pressure becomes a problem, scramble and put something together. Call the Legislature back and say: “Oh, we’ve discovered it’s a problem. We have the answer for it. We have the solution.”

Well, let’s take a look at the legislation. Let’s take a look at the specifics that are in Bill 28 and see whether they actually do address the concerns that have come forward.

There are four measures in this bill. The first, which is the one that I think most people have heard about, that they’re hearing about in the news, is an additional tax, using the property transfer tax, of 15 percent on residential purchases in Metro Vancouver by foreign nationals, which is the term that the government uses in the legislation.

The second piece of this legislation is a new fund that’s going to be created. It’s a fund called the housing priority initiatives fund. Additional revenue from that 15 percent tax is going to go into that fund, along with $75 million from government.

The third piece of this piece of legislation is a move to end self-regulation for the real estate industry.

The fourth and final piece is amendments to the Vancouver Charter to provide Vancouver, and only Vancouver, with the authority to implement a vacancy tax.

I want to take a few minutes to unpack each of those areas because I think it’s important for the public to know what has come forward in this legislation. What are the areas that the government scrambled to put into a bill? Then, as I said, I’ll close off by talking about what might have been.

I think most people will have taken a look at the 15 percent tax and presume that it might address the issue of speculation in the housing market. But I want to raise a number of questions and a number of concerns that arise with this approach.

This approach takes focus at foreign nationals and citizenship status rather than foreign money that might be coming in and might be used for speculation or for money laundering. My colleague from Vancouver–Point Grey, I think, described it very well when he said that this bill taxes who you are — in other words, your citizenship status — rather than what you are doing. Are you here paying taxes? Are you here contributing in the province, or are you not?

I think that’s a very important distinction to take a look at. It truly does leave huge loopholes for folks to avoid paying the taxes. It also does nothing to address any of the speculation money that is already in the housing market. It addresses new money coming in, buying properties, but it does nothing to address any money that may be here already. Again, I’ll come back to that.

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It also doesn’t address the loophole that might be set up with Canadian companies or companies set up in Canada that could be using foreign money to purchase property. They’re going to be exempt. They don’t have to pay because, again, it’s not a foreign national, the term used in this legislation, buying the property. It’s, in fact, a company set up by somebody else.

I think there have been lots of questions raised around property that may be bought by a foreign student coming in and utilizing some time here to be able to purchase property.
[ Page 13396 ]

I think it’s important to remember the questions that are unanswered with utilizing, as I said, the issue of citizenship rather than the issue of: are you here? Are you contributing? Are you paying taxes? If you look at people who are, in fact, invited to come to British Columbia…. Whether it’s doctors coming to British Columbia because we may have a shortage or whether it’s other professionals where we have a shortage and people come in, there is a real challenge when you take a look at using citizenship to say that that’s going to be the criteria. Yet they’re paying taxes, and they’re contributing here in the province.

That’s very different than someone who is not paying taxes and who is putting foreign money in simply as an investment or, as I said, questions being raised around money laundering, illegal money, drug money, etc., being utilized, which you can track because there is no income tax being paid in the province by those individuals. So a very different approach that’s being taken here.

I also think it’s important…. You know, the minister who spoke before me talked about the government taking the time to be able to put this together. Well, I think there are a whole number of things that we can point to that show time wasn’t taken. In fact, the government could have acted months ago on this issue. But I think the one that I just want to mention is the issue of collecting data.

We had suggested a long number of months ago that the government needed to start collecting data on foreign ownership. It seems like a basic step. If you’re looking at the challenges of money coming in and you’re looking at the real estate market, you want to make sure that you’re collecting data, particularly when you’re looking at a tax or looking at some kind of penalty for people. Yet, again, this government and the Finance Minister refused to act, refused to move on collecting that basic information. In the end, because of mounting pressure — pressure from the outside, pressure from bad headlines, pressure from the opposition — the government decided that they better start collecting self-reporting citizenship status.

When did they start collecting that information? They started collecting that information in mid-June — not last June, 2015, but this June, just a few weeks ago — to start putting the information together to be able to bring this legislation forward. So when the members stand up and say, “This has been a thoughtful approach, and we’ve taken our time,” I think this alone shows that that is an absolutely ridiculous statement.

In the end, it was 25 days of data that was collected for this legislation to come forward. It certainly doesn’t, from my perspective and, I don’t think, from the public’s perspective, point to thoughtful policy work or point to taking the time to do proper planning on anything that’s come forward.

I think another huge and very valid question and concern that has come forward is the fact that this foreign speculation tax only applies to Metro Vancouver. Well, let’s remember — and I read the quote at the beginning of my time — that it was only six months ago that the Finance Minister actually stood up and said: “We make housing policy for all of British Columbia, not simply for some parts of the province. We make it for everyone.” Well, here we are….

Interjection.

C. James: Exactly, except when we don’t.

Here we are debating a piece of legislation that simply applies to one part of the province — Metro Vancouver. It should be no surprise to the government that other municipalities — including the municipality I live in, Victoria, and others in our region — are really concerned about foreign speculation that’s now going to be pushed to our area.

[R. Chouhan in the chair.]

This is something we’ve already been seeing — pressure over the last year but pressure, in particular, over the last number of months, six to eight months, where individuals are receiving in their mailboxes, myself included, two or three times a week, flyers saying: “We have foreign buyers. We’re ready to purchase your home. Just give us a call. We’re prepared for it.” Those are things that have been happening already in Victoria. Outbidding, which is not something that normally we have seen, is happening in Victoria.

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We have people who are having people knock on their doors, driving around on weekends in neighbourhoods, asking people if they’re interested in selling their house.

So I think, again, when you take a look at the challenges of scrambling to bring something forward to address the Premier’s problem and the government’s problem — not the families’ problems and the challenges of individuals who are looking for housing — there are going to be consequences. The clear consequence here is when a tax only applies to one particular area of the province, you’re going to see buyers move to other areas that don’t have the tax. That’s pretty straightforward. That’s going to be a big problem. It’s going to be a big problem in other markets.

I heard the minister say: “Well, you know, other municipalities can come forward to UBCM at the end of September, and they can raise concerns.” Well, why didn’t the government listen and do it right in the first place? I think that’s a very valid question for the public to ask. If it was an issue and the government knew it was going to be an issue, why didn’t they take the time and do it right in the first place or act back in February and January when these concerns were coming forward — or a year ago when the issues were raised — so they didn’t have to scramble and bring something forward?

The second piece in this bill that I just want to speak to is the creation of a housing priority initiatives fund. As I
[ Page 13397 ]
mentioned, this is a fund that the government proposes to put together in this legislation that would receive the dollars from the new foreign buyers tax. Now, I’m a big supporter of spending money on affordable housing. I think a housing fund is a much-needed and a long-overdue step. But like everything else in this bill, in Bill 28, there are a number of unanswered questions.

How is the money going to be used? We already have — and we saw it in the spring session — the Premier’s fantasy fund that has $100 million in it from taxpayer money that, if you’ll remember, was actually going to be money from an LNG industry that didn’t materialize. That’s a $100 million fund for the Premier without specifics around how those dollars are going to be spent.

I think, again, it’s a very valid question to ask whether this fund is going to become one more fund for the Premier and for the government to be able to use and to draw down in what happens to be an election year. I think that’s a very valid question.

Interjection.

C. James: The member says I’m a bit cynical. Yeah, I think at this point, the government has given me lots of reasons to be cynical. Lots of reasons. Given this government’s promises in the 2013 election, there is good reason to be cynical, to be skeptical, to be questioning the kinds of approaches that they’re using.

We’ll all remember debt-free. Debt-free, when we just saw public accounts come out with the largest debt we’ve seen in British Columbia. Eliminate MSP premiums — I believe that was also a promise made in 2013. So I think there are some very good reasons to be skeptical about this government putting a fund together that doesn’t seem to have the kinds of checks and balances that are necessary, the kind of accountability around the spending of public dollars that is expected by the public.

That is good government — to be able to be accountable for those public dollars. The powers in this legislation appear to be pretty open-ended — an ability to make loans, to guarantee repayments of loans, to acquire, to construct, to maintain, to renovate housing. Again, as I said, I’m all for spending money on affordable housing, but given this government’s track record on other areas, it’s critical that those checks and balances be in place. So I’m very concerned about that section of the bill as well.

The third area in this bill is the move away from self-regulation for the real estate industry. You know, again, I think we have to remind everybody who moved the government, who moved this industry to self-regulation. Why, it happened to be this government.

In 2004, in an effort to end red tape, the Finance Minister of the day, Gary Collins — I’ll just read from his quote — said: “These changes will help to ensure that this important industry remains a vibrant part of our economy for years to come…. By replacing the…act, we’re ensuring that people who retain the services of professionals or purchase units are better protected and at the same time reduce unnecessary regulatory requirements.”

Well, here we are putting back in place those regulatory requirements. Think of all the years lost.

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I also want to say that it’s important to note that the vast majority of real estate agents are ethical and supportive and work properly in the industry. And the reason that you need to make sure that the regulations are there is to weed out the few bad apples so that the good real estate agents, the vast majority of people in this industry, aren’t targeted with that bad behaviour. Because when there are a few bad apples, people presume the whole industry is the problem, and it’s not. It’s a few bad apples. But because this government got rid of regulation and put in place self-regulation, those few bad apples were able to wreak havoc and cause problems for individuals.

It’s a good move. I’m glad this part is coming, but again, let’s remember: it’s this government who brought it in as a way of reducing red tape. They’re fixing their own mistake.

The last piece, of course, is the vacancy tax. Again, the Minister of Finance ridiculed the idea of a vacancy tax. He called it an economic wall that the opposition…. How dare we propose something like a vacancy tax? It took the mayor of Vancouver to give an ultimatum to this government, to say, “We’re going to go on our own if you don’t act,” for this government to actually finally do something. Yet again, instead of thoughtful planning, instead of doing something that was going to support the province, this government decides: “Well, we’ll try it out. We’ll put a vacancy tax in place in Vancouver.”

Well, you could have different sides of the street having different rules in place. Again, it might be a tool. My city, Victoria, has said it may be a tool that they might want to use, now or in the future. They’re starting to look at how they can gather the information to know whether it’s going to be a helpful tool. Well, if this government had planned, instead of only reacting when it becomes a problem for them, we wouldn’t see this kind of piecemeal approach. We wouldn’t see where one city has one set of rules, and next door or across the street, there’s another set of rules.

What might have been? Well, in fact, in March, a number of months ago, our leader tabled an act in this Legislature that was called the housing affordability fund and speculator fee act. This act was researched. In fact, it looked at a proposal, a very innovative proposal, that came forward from the Sauder School of Business and 40 economists, that actually looked at if someone wanted to buy property in British Columbia and they don’t pay their worldwide taxes here, they’d have to pay a speculation fee.

Now, the advantage of this, very different than the bill that’s in front of us, is that it addresses both the current and the future market. The government’s proposal simply looks at the future market and only catches one piece.
[ Page 13398 ]
Our proposal actually looks at the current and future market. You link it to someone paying taxes.

We also said that we wouldn’t penalize simply immigrants or people who come to British Columbia but in fact people who aren’t contributing and aren’t paying taxes.

We also, in our legislation, proposed a task force to fight tax fraud and money laundering and a proposal to end shadow flipping and close loopholes. We also proposed better tenant support, better protection for renters; renovictions — a huge area in my community that I’ve held a number of meetings on. There are big loopholes there that need to be addressed. And protection for manufactured home owners.

While I’m glad that the government has finally brought something forward, it could have been so much more. It could have been a comprehensive housing policy.

We proposed, in March, an act that the government was welcome to take and could have implemented that would have touched on all of those areas, not just a piecemeal approach, that would have looked at a long-term housing strategy, that would have begun to address the affordability issue that is a crisis for families around our province, a crisis created by this government — whether we’re talking about housing or MSP, whether we’re talking about Hydro or tuition, whether we’re talking about ICBC. You name it; this government has made life harder for families.

Now, when it’s becoming a problem for them, they’ve decided they better scramble and put something together. While I’m glad, as I said, that something has come forward, it could have been so much more.

There’s a real opportunity to actually act on behalf of the people of British Columbia, which is what a government is supposed to do. Instead, what we see is a government that acts on behalf of themselves when it becomes a problem and the rest of the time ignores the public. Well, that needs to change on behalf of the public of British Columbia.

[1450]

Hon. T. Wat: It is indeed a pleasure and an honour to rise in this House on behalf of my constituents in Richmond Centre and take my place in the debate on Bill 28.

Our government is committed to growing our diverse and strong economy, while at the same time safeguarding the interests of British Columbians and putting British Columbians first.

Clearly, in my beautiful riding of Richmond Centre, population has been growing at a rapid rate for the past decade. The entire city’s population has jumped close to 9 percent to over 200,000 people from 2011 to 2014.

Our government is committed to providing more affordable housing for British Columbians. Increasing density is one of the measures that our government introduced. Let me use Richmond as an illustration. Our government funded Kiwanis Towers, a two-tower affordable housing development for seniors in the core of Richmond. The 294-unit development replaces an old 122-unit complex. Many seniors moved into this first tower in spring last year. This year, a new 129-unit affordable rental housing development will also be built to house some of the city’s most vulnerable residents at risk of homelessness.

Today the province is taking further steps to help keep the dream of home ownership within reach of middle-class families and ensure that those who are in a position to rent are able to find a suitable home. Bill 28 will create new measures to help make home ownership more affordable, establish a fund for market housing and rental initiatives and strengthen consumer protection. This bill addresses an urgent and pressing issue that has personally impacted many of my constituents in Richmond.

For several years now, prospective homeowners — and young families, in particular — have felt increasing financial pressure as the price of real estate in the communities they call home has continued to rise. For too many of these families, the dream of home ownership is slipping away before their eyes. While many families have benefited from seeing the price of their home rise, many more, unfortunately, find themselves on the other end of this equation and have seen homes become less and less affordable.

The root of this problem, unfortunately, lies in a problem of too much demand for too little supply, and it’s easy to see why. British Columbia truly is one of the best places on earth to live. We are blessed with a beautiful abundance of natural geography, a diverse and thriving population of hard-working young families and the strongest economy in Canada. British Columbia attracts people from across Canada and around the world to our great province and our beautiful cities.

That said, this trend of continuous increases in prices year after year has created a challenge for certain British Columbians in their dream of home ownership in Vancouver. Our province’s cities must remain areas where young families can lay down roots and raise a family and entrepreneurs can establish businesses and know that their employees will be comfortable and content where they live and where others can come to lead a prosperous life for them and their loved ones.

Our government has recognized this. Last February, we took a number of important steps to address the issue of housing affordability for British Columbians in our annual budget. We introduced new measures to stimulate the creation of more housing supply, make investments in affordable housing and set out policies to gather better data on the impact of foreign purchasers on our real estate market. This is indeed a complex issue that requires a number of innovative approaches towards solving it.

Now I’m pleased to say that we are taking the next steps. Bill 28 will implement a number of important
[ Page 13399 ]
changes aimed at bringing home prices into a more affordable range for British Columbia’s next generation of homeowners. Ending the privilege of self-regulation for the B.C. real estate industry will put an end to some of the unscrupulous dealings motivated by greed, which unfortunately have damaged the reputation of realtors and shaken consumer confidence in the industry.

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Additionally, giving the city of Vancouver the legal tools it needs to implement a tax on vacant homes will help free up idle properties to add to the rental stock and allow more people to rent throughout the city.

Finally, a property transfer tax on foreign nationals purchasing property in Metro Vancouver will help slow demand from abroad and ensure that our province’s cities are not simply another product for financial speculation but a place where people may live and raise their families. These measures will be complemented by a housing priority initiatives fund to increase the supply of market and affordable housing. This fund has already received an initial investment of $75 million.

I must, unfortunately, note that the debate surrounding the issue of real estate affordability in Vancouver has taken on, at times, a vicious tone. Many have resorted to finger-pointing, and the Chinese-Canadian community has undoubtedly endured a degree of bigotry as critics resort to generalizations while looking for groups to blame for the problem of higher home prices. I would remind those critics that it is Chinese-Canadian families who have been some of the longest-standing homeowners in the Lower Mainland. They have felt the negative impact of rising home prices just as much as any other families in the region, and they are just as eager to see measures to address this problem.

I hope that the measures contained within this bill will keep the dream of home ownership within the reach of middle-class families, as well as ensure that individuals and families seeking a home to rent will be able to do so. The province is working on additional measures to address the complex causes of rising housing prices in Metro Vancouver, as well as in other regions of the province. The core of the issue is on the supply side. I urge both the federal and municipal governments to work together with the provincial government in increasing housing supply so that together we can address the housing challenge for British Columbians.

We have a duty to ensure that our province’s cities remain affordable for our children and for our future generations. I’m confident that Bill 28 will help forward this goal. That’s why I’m pleased to support this legislation, and I encourage all my colleagues to do the same.

L. Krog: I’m delighted to rise in debate today. My grandmother was fond of saying, and I don’t know whether she had a prejudice against geese or not, that the goose woke up every morning and rediscovered the universe — which, I suppose, is a rather exciting proposition. It must make the world a very interesting place. I wouldn’t wish to compare all of the members opposite to geese, but from a governmental perspective, it’s just like they woke up yesterday morning and discovered there was a housing affordability crisis in British Columbia.

“Oh my goodness, we have to call the Legislature back into session as quickly as we possibly can and put something out there, because firstly, we’ve got the photo op with Justin coming up, and we didn’t want to muck that up. So we’re finally going to agree to do what the opposition has been asking to do for ages, even though it causes chagrin for the member for Chilliwack-Hope” — who, I want to say, spoke eloquently in expressing his views here yesterday and shouldn’t be criticized for it unnecessarily.

“The second thing is that, of course, we have to politically respond to the obvious” — which is that people who live in the Lower Mainland in particular, and southern Vancouver Island, have come to realize that after 15 years of B.C. Liberal government, the basic Canadian dream of home ownership may well be a fleeting mirage they see disappearing over the horizon of rising prices all over the province. That’s really why we’re here. The geese woke up, and the geese are still actually clever enough to realize, though, that they have a real problem: that the people of British Columbia are starting to finally understand that it really is politics all the time.

[1500]

They didn’t care about affordability or issues the opposition raised until, obviously, their own polling numbers started to show that people were genuinely concerned about this issue, that people in British Columbia were realizing that they weren’t better off. Now, those folks who actually owned a home already are better off. Life looks pretty good for them.

We had to respond to legitimate concerns of British Columbians around housing affordability. We had to do it quickly, because, after all, we’re in that election-year countdown now — well less than a year until May 9, which is going to roll around pretty quickly. So we get the Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act, 2016.

Sometimes, I make little jokes when we get the old misc bill from the Attorney General. I make a little joke about it being tricky. It’s usually just a joke, of course, and no disrespect to the Attorney General or the hard-working legislative drafters. But this one, arguably, is a little tricky because it’s all about the politics of it.

It’s tricky in this sense. Although it may be drafted well within one sense of the term “drafted well,” it is drafted extremely quickly and in a way that didn’t give thought to what the proposed solution and its impacts might actually have on housing in British Columbia.

Let’s just throw out a simple example. UBC has just celebrated the arrival of a new president, a distinguished academic. Imagine for a moment that the new distinguished
[ Page 13400 ]
president of UBC was an American citizen or a citizen of the U.K. or France or Syria. And presumably, they wanted to come here and buy a house.

Would, in fact, this legislation mean that if they wanted to buy a house, they’d have to pay an extra 15 percent tax, even though the province of British Columbia and the board of UBC wanted this person to come and head up our largest and most prestigious university?

Does one of these wonderful tech companies that are operating in the province of British Columbia now have to say to the people they want to hire from abroad who maybe work in their London office or their San Francisco office: “Oh, by the way, we’ll cover the special tax you’ll pay as a foreigner coming to British Columbia”? As a foreigner. We refer to foreign nationals.

Now, I don’t want to suggest for a moment that the B.C. Liberals, in desperation, are turning to a Trumpian response to the political problems they face. But Donald Trump has made a great deal of progress in the United States by talking about what used to be referred to as “the other,” those other folks who aren’t like us. We’re going to blame the foreigners for our rising real estate prices. We’re going to say to them: “You have to pay a special tax.”

I listened to the minister speak earlier. I appreciate this province has a long and rather sad history of racism. I think of the Chinese head tax and how members here and members in the federal parliament have acknowledged what a dreadful stain that is on the history of this great country and this province in particular.

But this bill just has that rather ugly element of that. What are we really trying to stop here? Are we really trying to stop people who aren’t citizens or don’t have status here from coming to British Columbia, from purchasing businesses? Are we trying to prevent them from operating here? Are we trying to prevent them from creating employment for British Columbians who happen to enjoy citizenship? What is the point of this legislation?

I would suggest, cynically…. The member for Victoria–Beacon Hill very kindly simply referred to me as “the member” when I muttered during her eloquent remarks earlier today about being cynical. I think I’m cynical enough to think that this really isn’t about good public policy. This is ultimately about the politics of the problems the Liberals have seen growing and developing over their 15 years in power.

The fact is we have watched house prices, particularly in the Lower Mainland, start to rise. On the one hand, you can say: “That’s a wonderful thing. It shows confidence in an economy. It’s a benefit to those homeowners who were smart enough or able enough or lucky enough to purchase in the Lower Mainland.” By definition now, the greater Vancouver regional district has become a special investment zone now in British Columbia, based on this legislation.

[1505]

When we talk about that and we do it in the context of foreign investment and foreign nationals, what really are we talking about? Do we really want to discourage talented people from coming here? Does this mean — in an effort to ensure or attempt to ensure that house prices will either diminish or stop rising so dramatically — that now public institutions…?

I use UBC as an example again. Does that mean now that public institutions will have to take taxpayer dollars or money they raise from a foundation related to the university to pay the extra tax that the new president or the vice-president or the distinguished professor or whoever’s coming to teach there…? Does that mean they’re now going to have to use taxpayer dollars to pay and compensate them for the fact they’re paying an extra 15 percent simply because they come from another place?

You know, I would feel a little bit guilty if I was trying to play what some might call the race card, but, gosh, it was the Minister of Finance, himself, in Hansard on May 10, 2016, who said: “Tell us about the vacancy tax. Tell us about the economic wall he and his colleagues would build if, God forbid, they were ever to be given the chance to govern British Columbia.”

There are brick walls and there are metaphorical walls. What is being created here, I would suggest, may create some metaphorical walls that will prevent some of the best people from coming to British Columbia.

I’m looking around this chamber today. I can’t comment on the absence of any members, but let me just say that most of the people here are descended from immigrants who may have come in very difficult times and very difficult circumstances. I’m just not sure that this response to the B.C. Liberals’ political problem is necessarily the appropriate one.

What does the bill do? It does four things. It’s going to levy a special 15 percent property transfer tax on residential property in Metro Vancouver. It’s going to create this new housing priority initiatives fund. It’s going to implement the “independent advisory group’s” recommendations ending self-regulation for the real estate industry. And it’s going to amend the Vancouver Charter to provide Vancouver — and Vancouver only — with the authority to implement a vacancy tax.

Now, I’ve got to tell you — you don’t have to be an economist or a rocket scientist to figure out that if Vancouver levies a tax on vacant property, that might actually have a consequence for the citizens and voters in Burnaby or Richmond or West Vancouver or North Vancouver or Delta or Ladner or all the surrounding communities in the Lower Mainland that happen to form part of the GVRD. When I heard the Minister of Community, Sport and Cultural Development use the language…. These were his words talking about this approach: “Measured and well-founded steps.”

I’m going to come back to Donald Trump. You know why Donald Trump is doing well in the States? Because people are sick and tired of hearing the language that politicians constantly use to hide what really amounts to
[ Page 13401 ]
the facts before them.

To describe this as “measured and well-founded steps” is absolutely preposterous. This is anything but measured and well-founded. To suggest for a moment that you’re going to be able to make a difference in housing prices and not have significant economic impacts — many of them negative on surrounding local governments in the Lower Mainland — by giving this authority to Vancouver is just utterly preposterous. It is ridiculous.

I’m afraid that notwithstanding…. The city of Vancouver appears to be grateful for having been given this opportunity. I want to assure the minister — and I know that he’s heard it already from others around the province — that there are many other communities who are not too pleased with this approach. I mean, what is this? Is this some….

Hon. A. Wilkinson: You don’t have to do it.

L. Krog: The member says we don’t have to do it. That’s absolutely right. The member’s absolutely right.

I’m always delighted to hear his interruption, because I know he’s an international guy who studied abroad and is very concerned about ensuring we have a free flow of ideas from around the planet. That’s a very important thing, which is why the B.C. Liberals are bringing in a special tax to ensure that foreigners — it’s made very clear to them — aren’t particularly welcome in British Columbia, unless you’ve got an extra 15 percent.

[1510]

It’s rather like going to one of those fancy nightclubs where you have to slip a tip to the bouncer to ensure you can get in for an evening’s fun and frivolity. Again, I’m just not sure that this is good public policy. Because it’s….

Hon. A. Wilkinson: That’s NDP thinking.

L. Krog: Oh, NDP thinking. Well, I’m glad that the minister credits the NDP with thinking, because it’s clear the B.C. Liberals didn’t when they were bringing in this legislation.

What possible logic could there be to responding only to the city of Vancouver instead of all of the municipal governments of this province? “Oh,” the minister says again, “it’s a measured and well-founded step.”

So you can go trotting off to the UBCM this fall — all you municipal politicians — and go on bended knee to the B.C. Liberals and remind them that, actually, MLAs get elected from all around the province, not just the great city of Vancouver. Maybe you can persuade the minister that this is a political disaster and the B.C. Liberals will reverse it in the spring session.

I’m not entirely sure of that, because if there was ever a party that never admitted they were wrong or made a mistake, it’s the B.C. Liberals. We’ve seen that over and over again. After all, it was only a few months ago when we were assembled in this chamber for a full spring session that the very concept of the vacancy tax or acknowledging there was a housing affordability crisis or an affordability problem in British Columbia generally was pooh-poohed by all of the B.C. Liberals.

I don’t want to go through all the boring quotes that have been assembled by our excellent research department. I don’t want to throw all the words of the B.C. Liberals back in their faces and remind them of what they had to say. I see some of the members are smiling. I know that when they’re smiling, it’s not because they think I’m funny. It’s because they recognize the truth as it’s coming home.

Having stated that, one of the fundamentals that I hear from the business community is that they talk about an even playing field. What’s the even playing field now? Let’s set aside for a moment the minister’s cogent arguments about Vancouver not having to implement the tax. Let’s talk about the greater Vancouver regional district. That’s the subject of a big chunk of this legislation, and that’s where the 15 percent tax is going to be levied. So how is that fair? What does that mean? What are the consequences for other municipal governments?

I see some of the intelligent members over there who actually paid attention in class when they were young. I see some of the intelligent members over there looking quizzically. Maybe the gears are starting to turn, and they’re starting to realize there will be significant consequences.

Again, they’re not all going be positive. In fact, they may disrupt the economy more than they care to. I look forward to reminding the voters of British Columbia, come May 19 and when we’re in the full swing of an election campaign, that this was their brilliant response.

In a cynical world, one might suggest that perhaps this was all about politics. And far be it for me to say it, but I do notice that when we come to the housing priority initiatives fund, in particular section 43 of the bill, we have, among the abilities: “Despite sections 21 (3) and 45 (1) of the Financial Administration Act but subject to the prior approval of Treasury Board” — that’s the government, by the way, for those of you who are listening and paying close attention — “the Minister of Finance may pay money out of the special account for the following purposes….” This sounds sweet: “(c) supporting the acquisition, construction, maintenance, renovation or retention of housing or shelter or the acquisition or improvement of land intended to be used for housing or shelter.”
[ Page 13402 ]

It sounds like the B.C. Liberals are actually going to build some public housing. Now, who could argue against that? That’s a good thing. But then comes the sweet and the sour of all of this. Here’s the potential sour: “(e) making loans to persons in relation to the acquisition, construction, maintenance, renovation or retention of housing or shelter or the acquisition or improvement of land intended to be used for housing or shelter.”

Now, I’m sure the Minister of Finance is going to stand here at some point and say: “Oh, that would only be for non-profit institutions. That wouldn’t be for any private developers whatsoever who might be donors to the B.C. Liberals.”

[1515]

Interjection.

L. Krog: Well, I must say to the hon. member: I guess I’ve lived in British Columbia long enough and have been bitten often enough to know there are snakes under a lot of those rocks.

Let’s be straight about this. Does this mean we have a new $75 million slush fund — a $75 million slush fund for the B.C. Liberals to start awarding contracts to good friends and good supporters, all in the name of satisfying their political problem? A bit disappointing and a bit sad. I would’ve expected more.

Again, it’s giving enormous power to the minister, essentially, to dip into a fund, again subject only to the approval of Treasury Board. It’s not even subject to cabinet approval. It’s just Treasury Board alone. The power is getting narrowed down here. I mean, at least in cabinet, I assume, you have a bigger debate than you do at Treasury Board. It’s got more members. Perhaps I’m being, again, too cynical.

If the vacancy tax is a good idea, and it’s just enabling legislation, what possible excuse is there not to allow it to be given to all of the municipal governments in the province? I mean, don’t we want a fair playing field? Don’t we want the same opportunity to be given to British Columbians across the board? The Lower Mainland is not the only part of the world — and the city of Vancouver is not the only part of the world — that, from time to time in this province’s history, has seen significant growth in speculation or house prices.

It wasn’t that long ago you could have bought a town, virtually, in the north of this province, let alone a house, for virtually nothing. Then, of course, when the mine gets announced or the mine comes back into production, suddenly prices go through the roof. I didn’t hear the B.C. Liberals showing any concern about those communities over their 15 years in public office. I haven’t heard any great concern, but that’s because that might only have affected one seat.

Now, suddenly, we’re talking about the whole of the Lower Mainland. The whole of the Lower Mainland — there are a lot of seats there. Suddenly the B.C. Liberals are listening. So what was formerly bad public policy, or good public policy, depending on which side of the coin you’re going to flip here….

Suddenly the B.C. Liberals, as so eloquently stated by our leader the other day…. Summer season — we’re back into the flip-flops. We’ve got a little flip-flop going here. How can it possibly be good for only one part of the province instead of the whole of the province? If this is enabling legislation, and it’s important, then give that possibility to everybody else. If we’re going to impose a housing tax of 15 percent in Metro Vancouver, why not impose it every place else?

I can tell you. I come from a community that’s the third-oldest city in the province of British Columbia. There are a significant number of Chinese families who are investing in Nanaimo, buying businesses, raising their kids there, paying their taxes, buying their groceries. I’m not sure my community wants to discourage those folks from coming and building it, because there was a significant history of Chinese contribution to my community. This tax has a nasty little ring to it. A nasty little ring to it.

If we’re going to carry on with this charade, and it is a bit of a political charade, I must tell you that the opposition has no alternative but to support it. Sad as that may seem, it’s a step forward. At least the B.C. Liberals have acknowledged the problem. The next question is: how much money are the B.C. Liberals going to spend advertising that they’ve solved the housing crisis in the Lower Mainland in British Columbia? How much money are they going to spend on that?

We know they’ve spent $800,000 talking about the new coding program in school. “We’re going to teach all the kids to jump into the 21st century and spend $800,000 telling the world that that’s a good thing.” I would be astonished if, in fact, we don’t see a massive advertising campaign coming out of the surplus of taxes paid by hard-working British Columbians, telling them what a great job this government is doing, all at the same time, as other members have pointed out, that they’ve watched their MSP premiums rise, their ICBC rates rise.

[1520]

Interjection.

L. Krog: The member could give my speech. Perhaps he will. Imitation is the sincerest form of flattery.

The reality is that British Columbia families are paying more and more and getting less and less. The reason they’re really angry and frustrated now is because that basic Canadian dream of home ownership is disappearing for them.

The B.C. Liberals finally woke up, and now this is the best solution they can come up with in a hurry, because they’ve ignored it and ignored it. Even by the minister’s own statistics quoted earlier today about the number of foreign purchasers and the percentage it represents of the value of land that’s being transferred…. Frankly, I think many British Columbians will be surprised to find it’s not that big a number.

I come back to my point. Is this really about a solution for families in the Lower Mainland or anywhere in this province who can’t afford a house or to buy real estate or to buy a condominium? Is this really a solution for them?
[ Page 13403 ]
No. It’s a political solution. It’s all about the politics of this. It’s all about shifting the burden, because the real beauty of this 15 percent tax — I’m again being somewhat cynical — is that it’s levied against people who don’t have the right to vote. Now, how clever is that?

This isn’t going to apply to wealthy British Columbians who are speculating on the real estate market and may be making it harder for other folks to buy a house. It’s only going to be levied on people who can’t vote themselves, because you have to be a foreign national. That’s the real beauty of this tax. Let us go after the foreign nationals. Let us go after the other.

I’ve got no problem with taking money from rich people and distributing it to people who have a lot less. That’s a good thing. I quote the Bible many times in this place. “Easier for the camel to go through the eye of the needle than the rich man to enter the kingdom of heaven.” I’ve got no problem with that philosophically. I do have a problem with it when it is done not out of a sense of virtue or devotion to community, but it’s done cynically as part of a larger political scheme to deal with a political problem only.

As many British Columbians watch that dream of home ownership disappear, the B.C. Liberals have responded in a way that was ill-thought-out. It was anything but measured and sensible. It is, in fact, creating two British Columbias: the greater Vancouver regional district, or Metro Vancouver, and the rest of us. It isn’t right.

Moreover, all during the course of this — and I think it’s not unreasonable to say it — they have at the same time both inferentially and directly attacked the realtors of this province. We just had Bathtub weekend in Nanaimo. It’s a big event. It’s gone on for a very long time, and it’s the realtors in our community who work hard to ensure that event comes off every year. It’s a significant economic contributor, and I can tell you that many of those realtors are not overly happy with the way they have been attacked.

This government had the responsibility to ensure that the RECBC had those public seats filled, and what are the realtors circulating? The information I’m getting from them: they had to beg the government to fill those seats. If they honestly had concern about the state of the industry, why weren’t they at least filling those seats?

If you look at the statistics, I’m advised that in ten years, the real estate discipline aspect of it is 5,531 complaints resulting in — wait for it — 411 suspensions and 203 fines. That doesn’t sound to me like a body that’s not taking things as seriously as it possibly can within the confines of the legislation under which it has to operate.

That legislative initiative and power could have been changed and improved and expanded at any time in the last 15 years, as this housing crisis has grown and grown. This just didn’t happen since last May. This didn’t happen in the last couple of months. We have watched this develop and develop.

[1525]

I think there are a number of realtors in this province who don’t feel very good about this government. And as they wisely say…. One of them wrote: “The truly unfortunate aspect of all the recent attention the media has given is that it will obviously absolutely have no effect on housing affordability.” This is a reflection of the people in the industry who work hard, who pay taxes, who work in community organizations, who put on events like the Bathtub days in my own community.

This is what they’re feeling. They’re not feeling they’ve had a fair deal from this government. They’re not feeling that this government has respected what they do for a living. They’re getting a sense that they’re being made out to be the scapegoats.

The member for Vancouver–Point Grey has pointed out that there was an obvious lack of enforcement, that the rules were in place. Problems, yes, but you know the old expression about the baby and the bathwater. So now we’re going to go backwards again, because after all, it was the Liberals who put this system in place in the first place. That’s the great thing about time. It’s the great and ultimate teacher. The fact is the B.C. Liberals have had 15 years to govern this province. The chickens are coming home to roost, to use another cliché.

The policy mistakes they have made in the past are now being borne on the backs of British Columbians who see the dream of owning a house disappearing, who see speculators and investment being made that makes it impossible for them to fulfil their basic dreams, who see the affordability problems in their daily lives, whether it’s around all of the things I’ve mentioned already or around the hopes they have for their own children, the hope that their children will have a better life than they did, the hope that their children will be able to improve on the lot that they’ve been given or worked for in their lives.

At the end of the day, the government has responded. As inadequate as it is, it will probably get support from the opposition.

Interjections.

L. Krog: Yeah, yeah. I know.

I’ve got to tell you, I want to quote again from the Minister of Community, Sport and Cultural Development. He attacked the member for Vancouver–Point Grey for not responding positively to the government’s action on this.

I just want to finish with a short lesson for the governing B.C. Liberals. Just a short lesson — very short. Their job is to propose, and our job is to oppose. Our job is not to be cheerleaders for the B.C. Liberals. I’ve heard all the cheerleaders over there. Let them cheer for themselves as long as they want. Our job is to ensure good public policy for British Columbians. They should stop criticizing us for doing our job, because they’re not doing their job.

J. Thornthwaite: I’m happy to get up and speak on Bill 28, the Miscellaneous Statutes (Housing Priority
[ Page 13404 ]
Initiatives) Amendment Act, 2016.

Our government recognizes that home ownership can be challenging in British Columbia, but mostly in the greater Vancouver area. I know firsthand about the concerns that citizens do have with regards to the housing prices, because I’ve been doing quite a bit of door-knocking in my riding so far this summer, and transportation and housing are the two main issues.

We are working on the transportation issue, specifically in North Vancouver with regards to the interchanges that we have funded, and we’re working on more. But with regards to the housing, I was quite happy to be able to tell my constituents that we’re moving in that direction, as well, and also with help for first-time buyers. Many of my constituents that are of my generation are very generally concerned about whether or not their kids, their twentysomethings, will be able to get into the housing market. I think we’re on the right track here with this bill.

[1530]

This legislation is designed to help keep the dream of home ownership within reach of middle-class families and ensure that those who are in a position to rent are able to find a suitable home. It’s based on six guiding principles, which our Premier has previously talked about: increasing housing supply; smart transit expansion, likely connected to density; supporting first-time homebuyers; consumer protection; increasing rental supply; and protecting the dream of home ownership.

With regards to the supporting of the first-time homebuyers, I would like to just remind my constituents who are watching that there was one first step that we instigated in the newly built home exemption that was talked about in Budget 2016. In Budget 2016, we introduced the newly built home exemption to the property transfer tax, which can save purchasers up to $13,000 in property transfer tax when purchasing a newly constructed or subdivided home up to $750,000.

Data to date — i.e., from July 14 — indicate that over 4,000 families have saved an average of almost $8,000 on newly built homes; total savings to families close to $32 million; 191 per week on average, 21 weeks; and 27 per day on average. The existing first-time buyers program has also helped more than 1,100 families buy their first home this year, and we expect more to come.

Based on these guiding principles, Bill 28 creates new measures to help make home ownership more affordable. It establishes a fund for market housing and rental initiatives. It strengthens consumer protection and gives the city of Vancouver the tools it requested to increase rental property supply.

The housing priority initiatives fund will establish a fund for market housing and rental initiatives through an additional property tax. Recent statistics indicate that more than $885 million in foreign investment flowed into Metro Vancouver’s residential real estate market in just five weeks, representing 86 percent of the capital invested in the sector by foreign purchasers throughout the province.

As part of Budget 2016, government began collecting data to identify foreign purchases and better understand whether, and to what extent, foreign capital is having an effect on residential real estate prices. Since June 10, buyers have been required to disclose whether they are Canadian citizens or permanent residents and, if not, their country of citizenship. By collecting this new information, we are in a better position to monitor the magnitude of foreign ownership and investment in B.C.’s real estate sector.

From June 10 to July 14, this data showed that almost 20,000 residential property transactions occurred in British Columbia. Almost 1,300 transactions involved foreign nationals. This was 6.6 percent of the transactions that involved foreign nationals.

Data specific to Metro Vancouver show that, among other things, Metro Vancouver accounted for almost 50 percent of the real estate transactions in B.C., but 75 percent of those transactions were by foreign buyers.

While foreign investment in residential real estate markets is only one factor driving price increases in Metro Vancouver, it represents an additional source of pressure on a housing market struggling to build enough new homes to meet demand. We will continue to watch this data closely over the coming weeks and months to see if the trends that presented themselves here continue.

Effective August 2, 2016, an additional property transfer tax of 15 percent will apply to purchasers of residential real estate who are foreign nationals or foreign-controlled corporations. This is not Canadian citizens or permanent residents. It applies to foreign entities registering their purchase of residential property in the greater Vancouver regional district, excluding the treaty lands of the Tsawwassen First Nation. My riding of North Vancouver–Seymour is therefore captured by this part of the legislation.

I understand that other jurisdictions worldwide have done this or similar rules to seek release from high home prices blamed on foreign money. Hong Kong, Singapore, Australia, Denmark and Britain, among others, have done similar rules and regulations.

[1535]

The proceeds from this additional 15 percent of property transfer tax will go towards creating a new housing priority initiatives fund for provincial housing and rental programs which will be announced in the near future.

This fund will receive an initial investment of $75 million and, as mentioned earlier, it will receive a portion of the revenues from the property transfer tax, including all revenues from the new additional tax on foreign buyers. The housing priority initiatives fund will be a new strategic and flexible central fund to implement priority initiatives related to supply of housing, rental housing and other forms of public shelter, as well as access and support to housing programs and initiatives.
[ Page 13405 ]

What about the vacancy tax? That portion of the legislation does not directly apply to North Vancouver–Seymour. It is a request that the city of Vancouver put in. Vancouver city council feels that a record low vacancy rate of 0.6 percent puts upward pressure on housing stock and contributes to unprecedented affordability issues.

We are proposing amendments to the Vancouver Charter to enable the city of Vancouver to implement a stand-alone tax on vacant residential properties. The city of Vancouver would be responsible for administration, implementation, collection and enforcement of the tax.

Regarding consumer protection, the last element contained in this legislation relates to the independent advisory group that was established by the Real Estate Council of British Columbia, which released its report into regulation of the real estate industry on June 28, 2016. The report presented a comprehensive examination of real estate practices and raised important questions about the effectiveness of the existing regulatory framework for the industry.

The amendments that are proposed to the Real Estate Services Act are intended to restore consumer confidence by increasing transparency and fairness in the real estate sector. These changes will help protect British Columbians when they are making one of the largest investments of their lives: purchasing a home.

The province is ending self-regulation of the real estate industry and substantially implementing the key recommendations of the independent advisory group’s report. The amendments also significantly increase the superintendent of real estate’s authority and oversight. Penalties have been increased as recommended, and the superintendent’s oversights are greatly enhanced.

In conclusion, I mentioned earlier that this legislation is designed to help keep the dream of home ownership within reach of middle-class families and ensure that those who are in a position to rent are able to find a suitable home. These are complex issues that will require a number of different solutions, and there’ll be more to come in the weeks and months ahead.

One thing I would like to mention is that these measures are also in addition to a great deal of work, which our Minister Responsible for Housing has been working on for many years, regarding affordable housing. This is a question and a concern that many of my constituents have had in the past. In February of this year, the government of British Columbia announced that over the next five years, we are committing a total of $355 million to create upwards of 2,000 new affordable housing units across British Columbia.

A strong, growing economy gives us the ability to make these investments in critical services, the largest single affordable housing investments in B.C.’s history. This $355 million investment to create more than 2,000 new units of affordable housing will ensure that more British Columbians have access to a safe and affordable place to call home.

The funding for this record investment will be generated from the non-profit asset transfer program. Its success is allowing us to invest money back into affordable housing while also helping non-profit societies secure the financing they need to become sustainable.

Non-profits have been asking government to transfer housing assets to them for many years, and owning the land will help them to improve long-term planning and to secure the financing they need to be sustainable. The asset transfer will support and strengthen the non-profit sector, which operates 90 percent of social housing in British Columbia. Naturally, tenants will not be impacted by these transfers.

[1540]

Once again, the government is acting on behalf of all British Columbians to ensure that everyone has access to affordable housing and shelter when they need it, with these affordable housing initiatives, as well as this recent Bill 28, with regard to the 15 percent tax on foreign nationals for the property transfer tax, the housing priority fund, the ending of self-regulation in the real estate industry and the amendment of the Vancouver Charter, as per the city of Vancouver’s request.

K. Conroy: I’m pleased to stand and speak to Bill 28, Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act. As my colleagues before me have expressed, I, too, have some concerns with this bill.

I understand the need to have something in place to deal with the issue of housing affordability in the Lower Mainland, but I also understand the issues in other parts of B.C., parts of rural B.C. specifically. I want to talk about some of those issues, and I want to ask some questions first — to get on the record some of the questions that have arisen due to this bill.

Now, one of the unknowns in this bill is the issue of dual listings. This is where the same realtor is representing both the seller and the buyer, which in some…. People might say this might not be a good idea, but I want to drill down on this a bit. In this bill, it says that under section 37, which enhances the role of the superintendent of real estate…. It’s this section that gives the superintendent the authority to end the practice of dual agency. Now, the bill itself doesn’t end the practice of dual agency. It was recommended by the independent advisory group, and the Premier has committed to ending this practice.

When the independent advisory group asked for input, they only asked rural realtors if this in fact happens — not why or how or whether there were issues or not, only whether it actually happened. There wasn’t a clear overview of whether it was an issue or not, especially in rural B.C. A manager of a real estate association said that in the years of fielding questions or dealing with issues from the public, he had never once got a call about dual-agency issues, that it just wasn’t an issue.

This, of course, is a concern in many areas of rural
[ Page 13406 ]
B.C., where there might only be one realtor, in communities where there only is one realtor, in small communities in B.C. where it’s not a large real estate holding. It’s not a large company like you see in the Lower Mainland. There might be hundreds of realtors within a number of different agencies.

In many communities in rural B.C., there’s only one real estate agent. Now, where there is only one realtor, how do the real estate transactions take place, if in fact — as the Premier has said — she will discontinue this practice? In small communities, these realtors are part of the communities. They’re trusted. They’re valued. They have valued relationships in the communities. These are principled people. These are people who never would put themselves in a position of conflict. They’re ethical.

They’re principled, as I said. They do what’s best for the people that they live together with in these communities. They’re the people that they see on the ball field, when they’re out watching their kids play ball or playing hockey at the rink. Their kids might even go to school together, or they might curl together, recreate together.

It’s a real concern if suddenly people who want to sell their home or buy their home…. They might have to go out of the community to get a realtor they don’t know, somebody they have absolutely no relationship with. They might have already sold a home in their community or bought another home with this very realtor that they live with in their community, and everything has gone through and been done properly. Suddenly, they might have to put an end to that long-term relationship or not be able to use that realtor, so that’s a real concern.

You know, where there are other realtors in other communities, larger communities in the province, this just isn’t an issue. I hope the minister will look at this issue and will say: “Obviously, we didn’t look at this thoroughly enough. We didn’t look at the rural communities in B.C. where there is only one realtor. We didn’t look at the small communities” — like I know there is in Golden or Kaslo or many of the communities up north, in northern B.C., where there just isn’t a large number of realtors working.

I hope that the Minister of Finance will take this into consideration. He did say, and I do want to quote him: “Secondly, we make housing policy. I know this perhaps will shock some people who will call a certain part of Vancouver home. We make policy for all of British Columbia, so we are thinking about the whole problem. For people who are fixated or call Point Grey home, I’m sorry. We govern for the whole province.” The minister said: “We govern for the whole province.”

[1545]

I will remind the Minister of Finance that, indeed, rural B.C. is part of the whole province. He needs to ensure that rural B.C.’s issues are taken care of when bringing this bill forward and that what he is proposing isn’t going to hurt communities like Likely, communities from up north, communities where there might only be one realtor. It could be a really troubling situation in rural B.C.

You know, I find it interesting that although he says that they govern for all of B.C., this bill really only addresses affordability in Vancouver. It really only deals with a very small part of B.C. geographically — a large part, I grant, as far as the population goes, but only a small part of B.C. geographically.

The minister of local government just said previously that they were responding to a request from the city of Vancouver. Well, the city of Vancouver made this request over a year ago. It was in May of 2015 that the mayor expressed concern to the government that housing affordability was an issue in Vancouver over a year ago. Not just this past month, not just in the month of June or July in just this year. It was over a year ago.

It wasn’t until now that the Premier and the government decided in their wisdom to suddenly call a session now, when it could have been dealt with quite realistically…. It could have been and should have been dealt with in the last session when — the member from Point Grey raised this again and again — there were esteemed people in the media who were raising it. People all over the province were raising it, but especially the people in Vancouver were raising that this was an issue over a year ago. It should have been dealt with in the last session.

I mean, I wonder: how much does it cost to bring the House back now? How much does it cost to bring everybody back and to have a session? What’s it going to take? Two, three — I don’t know — four weeks to settle this issue? How long is it going to take? How long is it going to take for our people to be sitting here when the House, typically, isn’t in session? How much is this costing the people of the province?

This should have been dealt with. I think this is mismanagement on the part of somebody that it wasn’t dealt with while the House was in session. They had enough notice. They’ve had notice about this issue for well over a year, and suddenly it’s an issue. Is it an issue, maybe, because the polls are showing it’s an issue, that because housing affordability has become the number one issue in this province and people are going: “Just a second here. Something has to be done”? So we get this bill now in the middle of the summer when it should have really been dealt with, I think, a year ago. But it fell on deaf ears then.

The government chose to mock people that were raising this serious issue. The quote from the Premier over a year ago, in June of 2015, in response to the situation…. What did the Premier say? “If you can’t afford to buy a home in Vancouver, well, then leave.” I’ll quote what the Premier said. She said: “There are lots of great places to live. Fort St. John is booming, and it won’t be long before you see…. We need lots of new people up in Kitimat and Prince Rupert. The views are amazing, by the way.”

Well, yes. The views are amazing in Fort St. John. I was just up there recently, in the spring. I was talking to folks up there, and they’re really concerned. Actually, the unemployment up there is almost 10 percent. When I was
[ Page 13407 ]
there, it was almost 10 percent — the unemployment in Fort St. John. That’s a real concern. So, yeah. You could go and try to buy a house up there, but try to get a job right now. That is an issue.

It is too bad. From the Premier’s quote, that just shows a lack of understanding if you actually want to live in the Lower Mainland that: “Hey, you might even have a job in the Lower Mainland.” What she is suggesting is: “Well, you can’t afford to live in the Lower Mainland. You might have a job there. But, what the heck, go and buy a house in Fort St. John. You could commute from Fort St. John.”

Well, does Bill 28 really address this? Let’s hope it addresses this. Let’s hope it does ensure that there’s affordability for people in the Lower Mainland. But, you know, after a year of denying that there is a housing crisis in this province, after an entire year, and then of mocking people for raising the issue, instead of seriously saying: “Yes, this is an issue in this province. We need to work together with people that are raising it….” You know, they finally have to deal with the fact that we do have a housing crisis.

[1550]

It’s unfortunate that the government only decided to deal with this when it became so obvious, and it’s unfortunate that I don’t think this bill really does go far enough to deal with the critical issues of affordability. I think that’s what happens when you rush a bill in just to meet your own needs and not to meet the needs of all the people of British Columbia.

Interjection.

K. Conroy: As my colleague from Nanaimo says, when you don’t really care, when you’re just doing it to meet your own needs….

There are concerns from other communities who see these same issues. I know that my colleagues have already mentioned Victoria and other parts of the Lower Mainland. This bill will only minimally address the issues in Vancouver.

I want to briefly touch on another issue around affordability that this bill actually could have dealt with. It’s an issue around agricultural land that Bill 28 doesn’t even consider. I guess agricultural land is not a big deal to the people that were drafting this bill. They weren’t thinking about affordability as a whole for the entire province. You might think: “What’s it got to do with this bill and this issue?” For anyone that’s tried to buy agricultural land and is faced with competition from people or governments other than B.C., it’s a big issue.

For those of us who are sitting on the standing committee for agriculture, we’ve heard this concern a number of times. Farmers in the Fraser Valley who want to expand their farms, farms that are providing affordable food to the people of B.C., can’t buy their land next door because it has been bought up with foreign money, not by people from British Columbia, in fact. People who want to expand their ranches to grow hay or pastureland up in the Cariboo or in the north can’t buy it because it’s been bought up, and not by British Columbians.

A really interesting case in point. The government of China, in their wisdom, has set up billions — I think it is almost $2 billion now — in a fund not to run a power company into debt but, in fact, to plan for the future. This is incredibly smart of the government of China. They’re using their money to go to other countries and buy agricultural land to ensure that they’ll have food-producing land for their citizens. It’s incredibly smart.

What are we doing here in B.C.? We’re giving away our land. We’re giving it to foreign companies. We’re proposing to flood it. We’re not using our agricultural land to think about our future. How does that produce affordability for the people of this province? This bill could have dealt with that. This bill could have said….

The former speaker referred to the country of Denmark — policies around affordability in housing. Actually, there are countries in the world that won’t allow foreign entities to buy their agricultural land to ensure that they sustain their agricultural land for the people of their country and their provinces and their states. That is a smart thing to do. Did that come up in this bill? Not a chance. It’s really sad to see that the government decided that, in fact, we’re going to focus on this very narrow entity. Even that doesn’t really go far enough.

In this province, housing affordability is a huge issue. So many people are seeing the opportunity of owning a home, the dream of owning a home, slipping away. So many of us grew up…. My parents were immigrants. They came to this country. They worked hard. They bought their own home. My parents built their home. They put so much blood, sweat and tears into that home, but they own that home. I remember the day when they burned the mortgage. You used to be able to do that. You don’t get that paper any more. You don’t get to burn your mortgage. They had a mortgage-burning party. They own their home. They were so proud that they actually owned their own home.

I look at our own kids. Some of them have been able to afford to buy their own home. I look at my nieces and nephews — some of them struggling to maintain their homes and some of them thinking that they won’t be able to buy their own home. That is a shame in this province — in a province as wealthy as what the resources are of this province — that people can’t afford to buy their own home, especially in the Lower Mainland. People will never…. What they might be able to afford is a condo but never their own home where they have a piece of property. You just see that dream of ownership slipping away, and you think….

[1555]

What does this bill do? What does Bill 28 do? Well, it proposes four measures. It’s going to propose a property tax of 15 percent on residential property purchases
[ Page 13408 ]
in Metro Vancouver, only Metro Vancouver, on foreign nationals — not on foreign money, on foreign nationals.

Does this mean that skilled workers, who we need in this province, skilled workers who have come and who are trying to get landed immigrant status, who are maybe, in fact, immigrants who have come to the country, as in fact…? The member from Nanaimo has a perfect example. If the new president of UBC had in fact been from another country, would he have to pay, or would they have to pay, this charge? That’s what this is proposing. I’m saying: if he was from another country, is that what we’re saying? “Come to our province. We need your skills, but we’re going to ding you an extra 15 percent.”

This government hasn’t thought through that it’s is not just foreign nationals, but it’s the foreign money. How are they going to bring in the guidelines to ensure that this isn’t what’s going to happen?

Hopefully, the government, in their wisdom, will look at some of the amendments that our critic will be bringing forward and say: “Yes, these make sense. We did rush this bill, but in fact, there are amendments here that are going to make sense, that are truly going to bring in affordability to the folks of Vancouver without penalizing people that are coming to work in our province and want to live in our province.”

Most of us probably have family who are immigrants. As I said, my parents were immigrants. My father came because they needed his skill here back in the ’50s. Let’s hope we don’t penalize people like them, who are coming to this province.

The bill will also create a new housing priority initiatives fund for provincial housing and rental programs. The fund will start with $75 million, and then it will receive portions of revenue from the property transfer tax. There were some issues with how that property transfer tax could be spent. There seemed to be a lot of leeway by the minister to be able to direct that money, maybe to friends that are building condos or something. I’m not quite sure, but let’s hope that’s not what it means.

So $75 million — that’s a start. It’s a minimal start. Let’s see. What would that mean in the high-cost real estate down in the Lower Mainland? What’s that? About 100 condos, maybe. Maybe not even that many. Some of the condos are pretty expensive down there. If you take that money into the Interior, we could do quite a bit with that amount of money in the Interior. We could really make a good start at creating some affordable housing. But right now, it’s earmarked for the Lower Mainland.

I hope that it’ll be earmarked for co-ops or for non-profit housing societies, those kinds of organizations who can do a lot with a very minimal amount of money. They’ve been used to doing that now for — what? — 15 years. They have done some amazing work with the co-ops in this province and the low-cost housing organizations, the non-profits who have done some really excellent work. Let’s hope that that money will be earmarked for those kinds of organizations, not developers who would do a favour for someone and put money in someone’s pocket to get money in someone else’s pocket — but actually see that money going into building affordable housing.

I know the member from Vancouver east was talking about the issue around affordability of housing down in her area, and I’m truly hoping that we will see more affordable housing down on the east side. That’s where the money should go, and it should be for non-profits and co-ops and that kind of affordable housing. Let’s hope that’s what the Premier will do and that the Minister of Finance will direct the money in that way.

It will also bring about the implementation, under the independent advisory group’s recommendations, of ending self-regulation for the real estate industry, setting out the new powers for the enhanced position of the superintendent of real estate, which is really interesting. As has already been said, and as I will repeat: it was, in fact, this government that brought in self-regulation in this industry. This is obviously a failed Liberal experiment in self-regulation that’s finally being acknowledged: “Oops, we didn’t get this right. It just didn’t work.”

[1600]

So after all these years…. Let’s see. When was it? It was brought in, in ’04 by then Finance Minister Gary Farrell-Collins, who said that this was going to be the best way to have the real estate industry run and had all kinds of other great things.

Well, none of what he said came to fruition. It hasn’t worked. Let’s hope, in its wisdom, that the government does see that self-regulation, in a lot of instances, just doesn’t work. Maybe they’ll be able to look at this and say in other areas where they have initiated self-regulating experiments, in some of our resource industries, that it hasn’t worked very well. Maybe they can drill back on that also and say: “Let’s see. Maybe we should look at not having self-regulating powers in other industries too.”

[R. Lee in the chair.]

One of the other measures is the amendment to the Vancouver Charter, which will provide Vancouver, and only Vancouver, with the authority to implement a vacancy tax. This seems like a lot of rigmarole to bring in a tax just for the city of Vancouver.

Surely, in their wisdom, when they wrote this legislation, they would have said: “Now, what other communities is this going to affect?” Or is it just: “Let’s try this out as an experiment and see if it works. Let’s see what kind of a response the minister gets at UBCM this year or from the UBCM”?

As far as we understand, there are other communities in the province that are having issues with affordability. There are others that have said: “Oh my goodness. This might be something that would work for us as well.” Why
[ Page 13409 ]
wouldn’t they bring in legislation that would be all-encompassing? Why wouldn’t they think it through?

They’ve known about this issue for well over a year. They’ve known about it. Why wouldn’t they bring in something that is going to benefit more than just the city of Vancouver?

Thank goodness the mayor of Vancouver and his colleagues have been calling for this for well over a year. I guess sometimes it takes people a long time to learn things. It takes people a long time to hear things, maybe to listen and actually hear what they’re saying. Finally.

But it’s only for Vancouver. I have to say that affordability is an issue in all of B.C. It’s not just an issue in Vancouver, like the downtown area of Vancouver. It is an issue in all of B.C., and especially in rural B.C. Some of those issues in addition to housing affordability…. Housing affordability is an issue in rural B.C., especially renting, rental housing.

I know that in my own region, people talk to me all the time about not only finding affordable rental housing but suitable rental accommodation — accommodation if you’re on social assistance or you’re lower income. Some of the people are struggling with two or three jobs and have a family, and they still don’t make enough to make ends meet. Never mind that they could actually buy a home. They know that’s not an option. All they want is a good, solid house to rent, to raise their kids in. That’s a struggle in some parts of my constituency.

We need to ensure that we have decent, affordable housing — suitable. The member who spoke just before me said suitable housing. We need to ensure we have suitable housing for families.

It isn’t just affordability of housing for families in this province. There have been so many increases in different areas that makes it so that families are thinking: “Can we even afford to buy a home?” They’re thinking of the increases they’ve had.

This government crows about balancing its budget. Who have they balanced their budget on the backs of? They’ve balanced the budget on the backs of people struggling to make ends meet, people who have seen so many things go up.

In five years, now, the Premier has increased MSP, the medical services premium. The Premier has increased hydro, has increased ICBC rates. How can you afford to buy a house in B.C. when you’ve got all these other things you have to pay, when you have low-income jobs? Will Bill 28 deal with that? No. Bill 28 will not deal with that.

[1605]

The members cherry-pick the things that have gone up. They say: “Oh, it’s only this much here and this much here.” But you add it all up. In some communities, it’s like $900 to $1,000 a month for some of those increases.

For the member from Quilchena — or wherever he is from, Tonyland — the Minister of Advanced Education, it probably doesn’t matter to his constituents, but it matters to mine. It matters to people in the Kootenays who are struggling to make ends meet. You’re darn right it matters. They don’t have the high-priced accommodation that people have down there and that the minister can mock.

I’m tired of listening to the mocking. People are struggling. People in the Interior — what do they want to do with their families? They want to go camping in the summer. What do they face? They face increased rates at a campsite. You know what else they face? They face lower services.

L. Krog: And a reservation system that doesn’t work.

K. Conroy: No kidding. You know how many people have called my office and said: “I used to take my kids camping up to Syringa every summer — never an issue”? Can they do that now? No, they can’t do that now, because they’re all booked. Who are they booked with? Not local people. I can tell you that right now. Some reservation company is giving them out. The Minister of Environment says we’re wrong.

We’ll tell all the people phoning our offices, all the members of the opposition who are getting the phone calls: “Oh, you people are all wrong. You have no idea what you’re talking about. Only the Minister of Environment knows that, oh my gosh, people are getting to camp.”

The number of people that are just trying to camp — that’s all they want to do. They want to take their families camping. They want to do something affordable. They can’t afford to buy a home, so they’re going to take their family camping. Some people have actually said they’d love to come to Vancouver Island. They can’t afford the ferry increases.

Some people have said they can’t afford to go on a holiday this summer because they’re trying to save money so they can send their kids to university or post-secondary education, and the increases in that are making life unaffordable for them.

Interjection.

K. Conroy: The minister, of course, says 2 percent. But we know that he’s, shall we say, gerrymandered. They say, “No more increases,” but they’ve given a way for colleges and universities to up the fees. They’re not really fees. They’re not upping the fees. They’ve put a cap on fees, so they say, but now they charge if you need counselling. God forbid you need counselling, because you’ve got to pay for it. There are suddenly all kinds of fees on everything.

Everything is going up. Hydro — someone said $73. Hydro is $375 more per year. That might be nothing to some people, but to people on low income, that’s a heck of a lot of money.
[ Page 13410 ]

It’s just infuriating that this government fails to see the affordability issue is an issue. It’s infuriating that people think: “If they can’t buy a home, it’s their own fault.” Does this bill help people in rural B.C. to afford a home? Does it make homes more affordable? I don’t see it.

I really wish that when we are coming here, when we are doing these extraordinary measures to come to the House in the summer, we would actually be taking care of the entire province, that we would be dealing with an affordability issue so that people can say: “I can afford a home.” In B.C., surely to goodness people should be able to afford a home. People should be able to have that dream. People should be able to say: “This government is looking out for me and wanting to ensure that I can afford to buy a home.”

When they’re struggling to make ends meet, when they’re constantly paying for more and more and more on the backs of people while these people are crowing about a balanced budget….

We know darn well it’s the people of this province who are paying for that balanced budget through more and more increases. If they don’t believe it, they only need to really talk to their constituents, who will only too happily open up. That’s what we’re finding. We’re finding that people are more than frustrated with issues in the province without having to deal with housing affordability but massive affordability for many, many issues.

Again, we have said that we will support this bill.

Interjections.

K. Conroy: We don’t know why they keep crowing.

[1610]

It’s with amendments that will make the bill somewhat more reasonable, perhaps even amendments that will make it applicable to the entire province, which would be a nice thing to see, maybe not just some cherry-picked parts of the province, and actually make it so that we are all here speaking on behalf of the entire province, as the Minister of Finance had said, not just a small part of the province.

Hon. A. Wilkinson: I thank my colleagues for their gracious support in this troubled time.

We’re here, of course, to discuss the housing affordability issue and to address the issue of the proposed 15 percent tax on transactions for residential real estate in the greater Vancouver regional district, applicable only to non-Canadians — that is, people who are not Canadian citizens or permanent residents. This is to take effect on August 2. The delay of a few days is designed to allow the real estate industry and the purchasers and vendors in the market already to arrange their affairs accordingly, if they are able to and if they see fit to do so.

Now, this tax will also be designed to capture foreign-controlled corporations, foreign corporations, foreign trusts, trusts in favour of non-Canadians. Of course, this is also accompanied by an anti-avoidance mechanism, much like the federal income tax statute provides, so that those who seek to avoid the tax — through the clever manoeuvres that people like the member for Nanaimo will come up with — will be obliged to pay the tax. They will be caught by the anti-avoidance measures. There will be auditors associated with this process so that the individuals involved — those in the transactions — will be subject to spot audits as well as subject to more thorough audits when there’s cause for that.

The overall package is designed to cool off an overheated real estate market. The members opposite seem to think that it should be applicable across the province, but that is patently absurd. We only affect markets where they need to be adjusted. In this case, in greater Vancouver, the real estate market is clearly overheated. It’s hard to find anyone who disagrees with that proposition these days.

In order to keep it accessible for Canadians — whether they’re young people going to the market for the first time, whether they’re people moving here, whether they’re people who are downsizing or upgrading their housing — we have to be able to take care of their interests by making sure that the market is functioning in a balanced way and the market is in equilibrium between buyers and sellers. That is not the case right now. We’ve seen the scenario where hundreds of offers are going in at times, with no conditions, and bidding wars are taking place, which are not a healthy phenomenon to maintain a balanced real estate market.

With that plan in mind, we have to think of how this will roll out. Of course, a few issues come up. Things like: what will new immigrants to Canada do who want to settle here?

I’m an immigrant. My family arrived here. What did we do first of all? We rented real estate. We couldn’t find a place, we didn’t know the country well enough, and we didn’t have enough money. So my parents rented somewhere to live until they could settle in. There are probably at least a dozen of us who fit into that category, who immigrated to Canada, people who sit in this House today. I’m looking at one across the way, the member for Skeena. That’s exactly what their families did, whether they came personally or their parents moved into rental housing. Then, in short order, they become permanent residents, and they are exempt from this tax.

It’s a complete shibboleth. It’s a complete sham to suggest that this will inhibit immigration for people who actually want to move here and live here. They will follow the course that all of us have followed for generations.

The issue arises of alternatives to this. The members opposite have been talking up the idea that there should be a 2 percent tax on property that is applied to that homeowner, and they can then escape the tax by proving they have appropriate income in Canada. Well, they have never defined what the income threshold would be.
[ Page 13411 ]
Is it $10,000, $20,000, $50,000 and, below that, you pay?

We heard from them just a couple of weeks ago in my riding, where they elected to hold a press conference to tell us not that the working poor are amongst us — which they’ve been saying for 20 years — but rather that those people with low income in my neighbourhood are tax cheats. Suddenly they’re going to turn on these people. They’re no longer in need of support because they’re the working poor. They’re tax avoiders — tax evaders, in fact — and they’re going to chase them down and prosecute them.

[1615]

They can’t have it both ways. They have to make a decision as to what they really intend to accomplish here. Do they intend to pursue people’s assets by taking off 2 percent per year, chopping off a big chunk of equity every year unless these people can show with their income tax returns that they earned an appropriate amount in Canada? This is ludicrous. What it does is it suggests the blinkered vision of the NDP, saying that unless you’ve got T4 income from an employer that reaches a certain threshold, then you’re in trouble.

These are the same people who say they want to encourage the tech sector. I’ll tell you what happens in the tech sector. People reach about age 30 or 40. They’ve built up some equity in their house. They take all the equity out to hire people to build up their company, and they have no income for three or five or seven years. What these people would do — the NDP — is turn on those tech entrepreneurs and say: “If you’re in a $2 million house and you’re flat broke, we’re going to send you a tax bill every January for $40,000, and you have to pay it.”

What happens? They liquidate their assets, they close their company, and they damn the NDP for eternity. That’s just one example of the absurdity of their proposition.

They say that somehow they’ll exempt seniors. What’s the modern definition of a senior when life expectancy is to about 90? Are they going to say: “Well, above 60, you’re a senior and you’re exempt from taxation? Above 65, 67?” Pick a date. In any case, no matter what date they pick, there’ll be many people in this province who have been fortunate enough to take early retirement.

In fact, large numbers of people who work for this government take early retirement. The NDP will turn on them and say: “Hand over 2 percent of your household value to us every year.” In Victoria, that’s probably about $1.5 million. Every one of those retired civil servants would be sent a tax bill for $30,000 in January and told: “If you’d like to appeal it, go right ahead.” One can only imagine the chaos in MLA offices under the NDP proposition.

My neighbour, who lives immediately north of me, is a retired accountant, was self-employed her whole life. She’s a widow of some 20 years. She has almost no income. She lives off her savings. So she would get a tax bill where she lives for, say, $70,000, $80,000, $90,000 in January. It would take her about ten seconds to come over and bang on my front door and say: “Who on earth did this?” I would then say: “Oh, the NDP proposition is that you can now appeal that because you’re a senior or because you fit into one of their categories of exemption.”

This is an absurd proposition. Of course, unless you’re in a permanent state like being a senior, you’d have to appeal it every year. Circumstances change. People’s income goes up and down. Take any person who is involved in an entrepreneurial activity where they may have income highs and lows. Anybody, basically, in small business who has an uneven income would get a whopping tax bill every January, and then they’d be asked to find a way out of it.

This is offensive, to put it bluntly. It shows the kind of crude, simplistic approach that the NDP take on the issue, which requires a thoughtful and nuanced approach, which is exactly what this legislation does.

We also have the issue of immigrants, people like me. They arrive in this country, and they don’t have any income for a while. They can’t bring a tax return from India or New Zealand and say, “Is this good enough?” to the NDP tax collector. No. If they’ve bought a house, they get the whopping tax bill. They have no income in Canada for the first year. So you’ve suddenly put an entry fee on immigrants. If you buy a house in this country in your first year as an immigrant, you’re going to have to pay a 2 percent tax to the NDP based on the fact that you can’t show income in Canada. This is absurd.

We also have the scenario where there are things like gifts, family loans, inheritances. Some people are fortunate enough to have family means. Those people would all be taxed by the NDP to the extent of 2 percent of the value of their house every year because they don’t have a discernible income.

Let alone our population of people with disabilities. They would receive these bills every year and have to go and explain themselves to the NDP as to why they shouldn’t have their house taken away from them, which may be something that their parents set up as a benefaction for them in their later years so that that disabled person wouldn’t have to worry. Now they get the NDP tax bill saying that life as they knew it is over. None of these things have been addressed by the NDP because they haven’t got the depth and sophistication to address this as an economic issue.

We also think about the sheer absurdity of taking two million households and matching their income tax returns with their property tax. The NDP criticize us for electronic health records being difficult. That’s a piece of cake compared to taking two million tax returns every January and trying to match them for address and assets, let alone the non-T4 tax returns, those from other sources of income.

[1620]

People with a variety of small business arrangements, whereby their personal income is low because they leave their retained earnings in the company, suddenly would have a document nightmare beyond description.

This would be a clever NDP invention, because they would get the federal government to hand over massive tax files and try to match them to property titles. That is preposterous, and yet the NDP don’t want to own up to it.

We also hear some nonsense about the homeowner grant being useful in this regard. The homeowner grant isn’t available to almost anyone in Vancouver because it has a threshold beyond which the value of the property means you don’t get the homeowner grant, so that is a complete red herring. Yet the NDP never own up to any of this.

What we have done instead is put together an elegant, simple, straightforward, easily administered tax program whereby non-Canadians will pay 15 percent on the purchase price of properties in the GVRD as of August 2. That is an elegant solution to a difficult problem that will cool the real estate market and allow people to get into the market who’ve been shut out because of the level of demand induced by foreign capital.

This will be a much more effective, timely and productive exercise than waiting for the NDP to send out two million tax bills in January and then inviting the public to get out of those tax bills. This is preposterous.

We need to support this legislation and move this matter ahead. To be blunt, we’ve heard nuances from the opposite side about some amendments on the way. We’ve just heard one of them being disclosed — that the tax should apply to the entire province, not just to the GVRD. Let’s just get on with this. Let’s let the NDP show their cards so we can actually get something done here.

N. Macdonald: Thanks for the opportunity. It’s a summer session, bit of a surprise. I guess it was interesting hearing the minister speak. Where the speech breaks down, and it breaks down very quickly, is with the minister saying that the market is clearly overheated and nobody disagrees with that. But all you have to do is go back six weeks, and all of the government benches disagreed with that assertion. That’s where it breaks down.

Six weeks ago in May — and in April and in March and in February — when this side was raising the spectre of an overheated market, that minister was full of derision with any suggestion that that was the case. Now, six weeks later, he stands in this House and tries to say that they’ve got it all figured out with — what was the term? — a sophisticated answer. Sophisticated, nuanced. How cleverly thought through for a problem that for the government did not exist six weeks ago.

Now, for people in Vancouver, it has existed for many, many years. For the critic from Point Grey…. He has raised this, as has the Leader of the Opposition and the Finance critic, repeatedly since February. That was an interesting speech from a very well-educated man. This is a Rhodes Scholar, a doctor and a lawyer. I think we saw the lawyer skills at play there. That was a pretty difficult case to make, and it takes two seconds to break it down.

He was full of contempt for the suggestion that there was an overheated market, and now he stands up and says it is clearly overheated and nobody, no sane person, would disagree with that assertion. Well, that’s an interesting transition.

So here we are in a summer session. A bit of a surprise, as I said. Here we go with a number of bills that reverse positions. Now, the Leader of the Opposition isn’t here to entertain me, but it’s good when he does. I thought his comment about summer being the time for flip-flops was a very funny line — he delivered it wonderfully — and, of course, it is.

We’re here for three initiatives — for government to reverse position on changes to the human rights code, to reverse its position on self-regulation and to reverse its position on the vacancy tax — so that’s a pretty significant flipping around. Like I say, the Leader of the Opposition, it’s not his job to make me laugh, but I think if you bring me back for a summer session, I appreciate the people who do that, and he did a good job.

[1625]

Last year, we were called here in the summer as well. We came back in the summer so that it would look like the B.C. Liberals were doing something about LNG in B.C. Remember that? That was the flavour of the day last year. This year, the B.C. Liberals have called the House back to make it look like they’re doing something about housing affordability in the Lower Mainland. Let’s hope that the government does a good deal better than they did with LNG.

I think it’s always important, as people are listening to government speeches, that just last summer we were hearing — still, as we have heard since 2012 — about the B.C. Liberals’ promises for a $100 billion prosperity fund from LNG funds. We were hearing about the abolition of the provincial sales tax, a debt-free B.C., getting rid of $168 billion in debt. We were talking about 100,000 jobs created and five to 20 LNG plants, the first operating last year.

That’s a pretty impressive list of massive misses. Here’s my turn, maybe, for over-swinging, but I don’t think I am. I don’t think, in the history of British Columbia, a government has ever made those promises and missed so spectacularly. So when the Minister of Advanced Education stands up and talks about the nuanced solution that they’ve offered here, I think it has to be in the context of what we heard last summer, and I think it should be quite as quickly dismissed as what it is. Nevertheless, I’m hopeful, for the people of Vancouver, that the B.C. Liberals will do better with this summer’s law-making efforts than they did last year.

Unfortunately, I highly doubt that what’s being proposed here is going to be hugely useful. I mean, it is a
[ Page 13413 ]
step, but it’s a small, timid step. This is because whether it is LNG or housing affordability, it is the appearance of doing something, not the reality of doing something, that this government is about. That’s what interests this government: the appearance of doing something, quite removed from the actual reality of doing something.

Bill 28 is a miscellaneous amendment act. It means that it amends a number of existing laws — in this case, all related to housing. Now, in 2008, a U.S. housing bubble burst, with massive harm across the world economy. The problems of 2008 impacted all of our communities because it impacted lumber pricing, it impacted our financial institutions. We know that that was a massive U.S. housing bubble.

Jock Finlayson was at the UBCM. I think there were a number of my colleagues who were attending a speech that he gave. He put the number…. I’ve seen it in other documents. He said that it was a $6 trillion collapse — $6 trillion. That is a mind-boggling sum. In other words, property, most of it residential property in the U.S., was overvalued by $6 trillion.

In retrospect, the cause was obvious: laws were changed in the United States to allow subprime loans. This was deliberate, with those lobbying for the changes making political donations to get the changes they wanted, fully aware of the potential for what turned out to be the world’s biggest Ponzi scheme.

In the end, in 2008, millions of people were hurt, but a small handful of those — who’d pushed the changes, a lot of the time — benefited enormously. The point I’m making is that housing policy exists within conditions that governments set. When governments set poor policies, problems are created. In 2008, the world economy was rocked by poor housing policy in the United States.

[1630]

Government policy here is now what we’re focusing on. It is important, in how it creates the housing market in B.C. Now, obviously, the British Columbia government does not come close to controlling all of the factors in housing prices in British Columbia. But government policy exacerbates, or it softens, problems in housing markets.

Let’s remember stakes in housing in B.C. are really high. Real estate is a very large part of B.C.’s GDP. It’s about a quarter of B.C.’s GDP. So when the government stands up and talks about the economy being strong, let’s remember that they’re not talking about rural B.C. and the resource economy. Those of us that represent those areas know that there are problems, right? They are talking about something that is driven by real estate, so you’ve got to get these policies right.

Property prices, particularly residential prices in the Lower Mainland, don’t make sense. Most people will look at them — and ministers are now starting to acknowledge it — and they don’t actually make sense. Normal people do not have this much money to possibly purchase housing. They don’t have that much money.

What is driving the prices? That is something that this government should understand but chooses not to.

What we are told is that there are loan practices that drive up prices. That is identified as one of the problems. We know that there is foreign buying, and we are told that there is money laundering. Remember there were former Solicitors General from the B.C. Liberal government, once retired, that talked about an underground economy here in B.C. of $8 billion. We know that there is massive corruption in other parts of the world and that money is laundered, and part of that process takes place here in British Columbia in the Lower Mainland.

Now, for some people, property is not about a home. It is an item for speculation. It is for safely diversifying placement of wealth, and as I’ve said, it’s for laundering illegally obtained wealth.

Housing, in my view, should be about something else first. It should be about homes, and it should be about homes for families and individuals. That’s what it should be first. That’s my central point. It should be about homes for individuals and families. That’s what it should be about.

The Lower Mainland is a living city. Vancouver is a living city. People should be able to live there, work there, raise their families. Vancouver is a remarkably beautiful city, in most ways, but it is too expensive to find housing, and it’s too expensive to rent. Now we’re in a place where everyone agrees with that.

The provincial government has an obligation to understand the dynamics that are in play in that housing market — not just three weeks of data hurriedly and selectively used. They should fully understand it, and they should have been working on collecting that data over the past two years. Instead, what they chose to do is deny that there was a problem.

That’s the first obligation for this government — to understand what is going on. Secondly, the provincial government has an obligation to put in place a set of laws that allow people to live in Vancouver. That is the public interest, but it assumes that government holds the broad public interest as their primary concern, and I’ve come to not believe that. I just don’t think that that’s what drives the majority of policy decisions from this government.

Many would suggest that donor interests distort government actions, and that’s my experience. I see that in what happens with mining regulation. I see it in forestry. I see it again and again, that those donors distort government actions and interfere with good public policy, and I see it here again. I think clearly there was a problem that would have been dealt with faster if the public interest was the main thing that government was looking at dealing with.

[1635]

When you look at housing prices in the millions, you realize that for normal people, they simply are not going
[ Page 13414 ]
to be able to afford that, especially since it has the feel of a bubble or a distorted market. The Minister of Finance alluded to that. In his speech this morning, he talked about the fact that people borrowing money to enter this market is a problem because they could easily overextend themselves. So regardless of what he said six weeks ago in dismissing any concerns about the market, now he recognizes that it’s possibly a bubble.

In fact, the Minister of Advanced Education said the same thing — that it could quickly come down and catch people who aren’t foreign buyers, who aren’t laundering money but simply think that the price of housing will continue to go up and have borrowed based upon that idea. So it is a problem, just as leading up to the 2008 U.S. housing crash, it felt like there was something unreal about the price bubble. It has a similar feel.

Let’s turn to some of the measures in this bill. The B.C. Liberals, in this bill…. Well, they give the city of Vancouver the right to apply a vacancy tax if they want to. If Vancouver wants to do it, they can. So the vacancy tax is, from this government’s perspective, Vancouver’s problem, right? “You guys handle it.” And according to the Minister of Finance, when introducing it, it’ll either happen or it won’t happen — like, whatever. That’s not exactly the B.C. Liberals owning the problem.

They stand up and say there’s a bubble. “Well, Vancouver can look after it there if they want to. Here’s a tool for them.” And they do it without any particular interest in actually solving the problem themselves. I don’t actually think the government feels the vacancy tax is a very useful tool. Colin Hansen, the former Finance Minister, says the vacancy tax won’t work. Now, I know the city of Vancouver thinks it will. But as recently as May 10, the current Minister of Finance said pretty much the same thing.

It’s not as if this is the government fully committed to solving an issue and owning it. In fact, it’s the exact opposite of that. It’s sort of: “Well, Vancouver is a problem. Polling’s bad. We’ll just throw this out there, and then it’s not our political problem.” As many speakers have said, it’s dealing with an issue that impacts people’s lives but not treating it as a governance issue — treating it instead as a political problem for the ruling party as we head into an election. Those are two really different things.

I mean, politics, everything we do…. You know, sometimes they say: “Oh, don’t play politics.” Well, we’re all playing politics. We’re politicians. We play politics. But there’s also, I think all of us recognize, a big part of our job that’s good governance.

When you’re dealing with housing, first, there is all sorts of room for abuse, so you’ve got to be very careful with it, right? Secondly, you are talking about where people live, the most important purchase they will ever make in their lives. So governance has to be a pretty big part of what you’re thinking, rather than simply politics. But this has the feel of politics simply. That’s a problem.

There’s also the 15 percent tax on international buyers. There’s a lot of money out there. Bloomberg, which I assume is a credible media source…. I have no hesitation quoting from them. They say that $500 billion U.S. has come out of China from individuals looking for a safe haven, and Vancouver real estate can be used for that. China has a tremendous wealth they have generated, and of course it makes sense to diversify where that money is.

Of course, they’re looking not only at Vancouver or Toronto but at cities around the world. But where we see it and what we’re concerned about is Vancouver. There’s no question that it is part of what distorts the Lower Mainland housing prices.

Now, a 15 percent tax on international buyers, as the Minister of Finance pointed out, is used by other jurisdictions. I think the two that the minister highlighted were Singapore and Hong Kong. There are other areas, other jurisdictions. The Minister of Advanced Education talked about coming from Australia. I think Australia has much stricter restrictions on real estate, buying real estate, but it’s not an uncommon tool.

[1640]

I think, though, that what we need to consider — and this will be tested in the committee stage — is that if one accumulates vast wealth in China, for instance, and gets it out of the country, then I think it may be rather simple to get around the 15 percent tax on international buyers. Already other members have talked about very obvious tools that can be used.

It’ll be interesting in the committee stage. The Minister of Finance, having heard what has been asserted, will have an opportunity to talk about how section 3 would work. Section 3 in this bill talks about how government would put in place measures to make sure that individuals wouldn’t get around that 15 percent tax. I think that’ll be an interesting exchange between not only a minister who knows his file but a critic who’s very knowledgable in the file too. I think that’ll be an interesting exchange.

There are many that would say that the government isn’t particularly concerned about this — the inflow of money. They talk about panda bonds as a new tool that B.C. uses, and some assert that the attraction for Chinese buyers is that they can be used to buy B.C. property by using the bonds as collateral for loans in Canada. Once again, I’m not one to know whether that is true or not, but surely the government would be looking at these assertions and have answers for them.

Now, the presale of condos is exempted, as has been noted. Of course, the assertion is that that again may be a policy decision distorted by the fact that major donors, the chair of the B.C. Liberal fundraising, would have a strong opinion on whether it would be applied to the presale of condos or not. So what we see here is a bare minimum done by government — no real intent, other than to limit political harm.
[ Page 13415 ]

That lack of intent, as well as what I think is obviously a rush job…. Like, the Premier today made fun of making policy on the back of an envelope. But I don’t think a government can completely…. On May 10, the minister stands up and says that the proposals that are here in this bill are completely unnecessary and that there is no crisis, and then six weeks later we get legislation. I don’t think a reasonable person would say that this has been worked on for the past year. This has come in pretty quickly.

There’s something I wanted to talk about that the member for Kootenay West raised. The Minister of Finance, I trust, will address it in his closing remarks. I highlight for the minister’s staff, who pay close attention to these things, that we’re hearing concerns from small rural communities — Golden, for instance. We have essentially one real estate firm. Sometimes when you put things together quickly, you have unintended consequences. I don’t know if that’s the case here, but an unintended consequence of measures aimed at the Lower Mainland problems has been raised.

I think the member for Kootenay West spent enough time to explain it fully, but basically what realtors in the Kootenays are saying is that the possibility of restricting double-ending or double-listing is problematic. I know it’s not in the legislation, but it is talked about in reference to the superintendent of real estate. What I would like and what I hope to hear from the Minister of Finance is that he’ll just explain.

I know it’s not just opposition MLAs that are raising this concern. I know there are members on the government side that are from the north and will have the same thing. It would be good to have on the record the government’s intent on dealing with that so we don’t unduly alarm realtors in our community.

It’s important to note that while the focus of this session is the Lower Mainland, the situation in much of rural B.C. is markedly different than the Lower Mainland. There are really two economies. There are probably more, but there are two clear economies. Resource-dependent communities are challenged these days, and pressures on housing are really very different from community to community. A three-bedroom home in Canal Flats is not millions of dollars. It’s hundreds of thousands, right? We are talking about a province that has a very different situation, depending upon which community you are in.

[1645]

Now, also in Bill 28, there are provisions to reverse the B.C. Liberal’s 2004 deregulation of the real estate industry. The B.C. Liberals created an industry-run real estate council, but it failed to enforce ethical conduct. I think that’s fair to say. That’s what the opposition was saying. That’s what the government is saying with this action. The Premier has said that.

The problem with lax rules is this, and it applies to everything. The problem with lax rules is that unscrupulous real estate dealers hurt the vast majority of realtors who are operating ethically. That’s the problem. You allow those that are willing to go to a place that they shouldn’t to hurt the reputation of an industry. Like I said, the vast majority…. I mean, we all know realtors, and the ones that we know operate ethically. You know, when you go to buy something or sell something, you trust them. You play old-timers hockey with them. I mean, there are relationships and even….

Unfortunately, I think that’s, I hope, a lesson that at some point we will learn. We glorify the ministry of getting rid of red tape, but sometimes rules are good things, because they can make a playing field that allows those that have pride in their profession and are going to operate honestly to do well and make sure that you don’t reward those that are going to be unscrupulous.

So we’re back to a place where we’re going to have government oversight. Clearly, the public trust has been ruptured. That abuse is well chronicled, and I don’t need to go into that. Hopefully, government oversight is going to be more effective. Partisan appointments can be capable or poor. Every government of every stripe puts people in place. Some work out and some are questionable, but their work is more directly accountable to the elected Legislative Assembly, so in my view, that’s better. I’m happy that we’re back in a place….

I just want to say a big shout-out to the member for Point Grey for his work, as well as a number of journalists who did good work. Although this will be irritating, I’m sure, and I know frustrating for government members, it’s how the system is supposed to work. You know? It’s how it’s supposed to work. As an opposition member, you have a certain role, and you should take pride when it’s done well. I think for all of us, and I know for government members too, this is a job that was done very well. The member has really done a good thing, and we can be proud of that.

Summer sessions are interesting things. They’re becoming common. I don’t know that that’s something that is hugely appreciated by all members. Like I say, hopefully this effort has more success than they did with last year’s LNG effort.

Since I have a few moments…. The Speaker, I know, will allow me to wander a little bit, since you’ve allowed me already to wander quite a bit. Since the Minister of Transportation…. In particular, I think, the Minister of Jobs is here and has family here. I think they both have family here. I just want to acknowledge the work that was done on…. It’s not the first file we’ve worked on. The Minister of Jobs, for instance — two new schools, when we were trying to get the highway rescue, the search and rescue building, and now with the rafters….

I think that often it’s not recognized within this place…. I don’t think I’ve ever even publicly acknowledged just how much work has been done to get a solution, and I just really appreciate it. I wish I’d said it when your grandchildren were here or your family, because it is part of
[ Page 13416 ]
how this place works, and I think it’s an important part.

Having said that, having spent 20 or 25 minutes of my time properly going after the government as I should — and I thought I was right, so I feel good about that — I also want to acknowledge the good work that’s been done.

With that, I’d like to thank, as always, the Speaker and those that are listening for the opportunity to speak.

[1650]

J. Yap: It’s my honour and privilege to rise on behalf of my constituents of Richmond-Steveston to add my voice to this important debate.

First of all, I want to acknowledge that it is wonderful to be here in Victoria, at the Legislative Assembly, in the summer, a special summer session. Yes, I mean that sincerely. It’s great to be here. It’s a different vibe when you’re here in the parliamentary precincts in the summer with the tourists who are here to learn about our great institution. Here we are, the MLAs in the House, doing the work of the people. It’s wonderful to be here, and I’m delighted to have this chance to speak on Bill 28.

This is a bill that covers an issue that is of great importance to British Columbians and to people in the greater Vancouver area. It’s very important to my constituents. As others of my colleagues have, I’ve been spending some of the last few months out and about in my community, going door to door, talking to constituents, listening to them. I can say without reservation that the issue of housing affordability and housing prices has been on the minds of my constituents, top of mind, consistently, all around my riding.

I am very proud that my government is taking such decisive action on a matter of such great importance to British Columbia. As a government, we recognize that home ownership can be challenging in B.C., especially in the Lower Mainland, in greater Vancouver. It has always been that way.

As an immigrant myself, having been here for four decades, coming with my parents…. We heard others in the chamber talk about their immigrant experiences. I remember well when we first arrived. I was a young lad at the time. My parents were talking about, back then, in the ’70s, the high cost of housing in Vancouver. It’s not an issue that has suddenly come upon us. It’s always been that way because greater Vancouver is such a special place and people want to move here, especially as our economy has become stronger and stronger. Economically, B.C. is the number one economy in Canada and has naturally attracted a lot of investment, people moving here from across North America and Canada and from around the world to be a part of this great place that we call British Columbia. With that comes the impact on housing.

Our government recognizes that it is so important to address the issue of housing affordability. This is a priority for our government. That’s why we’ve taken various measures to ensure that the middle-class dream of home ownership is kept within reach for British Columbians. Just a few weeks ago the Premier announced that our government would end the real estate industry’s self-regulation and overhaul the system of governance, the system of oversight, transparency and accountability of that sector.

I’d like to take this opportunity to say in this chamber that the vast majority of real estate agents — I know many; I count many among them as friends — are above reproach. They are professionals with a sense of integrity and do a great job representing the interests of their clients. Unfortunately, as has been referred to by other members, there has been a shaking of the trust. The public has a right to have trust in their real estate system and the professionals that they do business with.

To restore that trust on the part of the public, our government has committed to establishing a dedicated superintendent that will be focused on real estate and only real estate. This position will take over the council’s regulation and rule-making authority to carry out changes that will be required to restore public confidence. We will also reconstitute the Real Estate Council with a majority of public interest, non-industry members. There will be a mix of people in the industry and others who are not realtors, who are not from the realtor profession.

[1655]

We will implement the recommended penalties as well as the increased fines for unlicensed activity and other offences that were recommended. We will allow for commissions from licensees engaging in misconduct, when it happens, to be taken back to the council. We will also make the managing broker responsible for ensuring that the owner of the brokerage does not engage in the business of the brokerage if the owner is not a licensee. We will no longer permit licensees to offer dual-agency representation.

In addition to this, we saw in Budget 2016 a number of measures designed to stimulate the supply of new housing. We’ve heard it said many times, and I believe it myself, that part of the reason why we’re having this affordability problem is the supply-and-demand issue. It’s so important to stimulate supply of new housing, to assist purchases as part of this, to also invest in affordable housing and to improve our understanding of what drives our real estate market here in British Columbia.

Yesterday our government took further steps to help keep that dream of home ownership alive and ensure that those who are wanting to rent are able to find a suitable place to rent. What this bill does is introduce an additional property transfer tax at a rate of 15 percent that will apply to non-Canadians, either those who are not Canadian citizens or are not permanent residents of Canada. Also, this applies to foreign-controlled corporations.

The additional tax will take effect next Tuesday, August 2, and will apply to foreign entities registering their purchase of residential properties in the greater Vancouver
[ Page 13417 ]
area, excluding the treaty lands of the Tsawwassen First Nation. This tax will help manage ongoing demand in residential real estate while the housing market responds by building new homes to meet local needs — the supply issue that I mentioned. Placing barriers to foreign investment in GVRD real estate will help manage rising prices while supply catches up.

The bill we introduced yesterday will also help to make home ownership more affordable. It establishes a fund for market housing and rental initiatives. It will strengthen consumer protection and give the city of Vancouver, which requested it, the tools to increase rental property supply by looking at the possibility of a vacant property tax, which the amendment to the Vancouver Charter will allow.

Now, as has been said by colleagues, there are many issues that go into the housing market. It isn’t a simple coming together of buyer and seller. There are so many issues. There are different conditions. The impacts of not just the world economy and of migration are complex issues. These complex issues will require a number of different solutions. There will be more to come, I believe, in the coming weeks and months.

In the meantime, I welcome the comments of colleagues on both sides of the House and urge all members to support our plan, our B.C. Liberal plan, to keep the dream of home ownership within the reach of middle-class British Columbian families and support Bill 28.

S. Robinson: I rise today to add my comments and thoughts to the debate on Bill 28, the Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act, 2016.

I was listening to my colleagues earlier and people referring to this rare summer sitting. I have to say, after having been elected in 2013, that this is the third summer that I have been here in this House, so I’m not quite sure how rare it is, given that it’s only been three summers.

[1700]

It certainly seems like it’s just a regular opportunity. I should be leaving some of my flip-flops in my place here. That becomes sort of what we wear these days here in this Legislature. Flip-flops are really good summer wear.

We’re here because there are four pieces of this particular legislation, Bill 28. But before I want to go into those pieces and about how I understand them and how it’s going to affect the people that I represent in Coquitlam-Maillardville, I want to talk about how we got here, because this affordability crisis is not new. It might be new to members across the way, but it’s certainly been one that I’ve been hearing about in Coquitlam-Maillardville.

It’s a crisis that could have been managed, that could have been handled, and it could have been addressed before it reached such epic proportions. It’s really disappointing to have a government that is so late to this party. Trying to close a barn door after the horse has left is not an easy thing.

As the MLA for Coquitlam-Maillardville, I spend a considerable amount of time talking to people. It’s what we do. It’s what we all do as MLAs. But we also need to be listening to people. In 2013, when I was campaigning on the doorstep, I heard lots about hospital wait-lists, surgery wait-lists. I heard a lots about concerns about education and concerns about public schools, and I heard a little bit about the economy.

In the last — I don’t know — eight, ten months, all I’ve been hearing as I listen to people is about affordability. They’re not talking about a whole lot of other things. Yes, there’s still a bit of conversation about schools, and yes, there’s some conversation about hospital wait-lists, but the theme everywhere I go is housing affordability.

I started hearing those rumblings a number of years ago, but I would actually say that in the last ten months, it’s been every single conversation. British Columbians — well, it’s probably more Lower Mainland people — always talk about the weather. That’s sort of a regular thing. Well, that’s changed too. They’re not talking about the weather. They’re talking about housing affordability. That’s been quite the surprise for me.

If this government had been really listening to British Columbians, really listening to people in Metro Vancouver, really cared to listen to what was going on, I would have hoped that they would have acted sooner. Or perhaps they weren’t interested in acting. I’m not quite sure which part of that equation it was. They weren’t listening, or they didn’t care to act.

But life has been getting harder and harder for my constituents. They’re noticing increased MSP taxes, increased hydro rates, increased camping fees, and they’re having a harder and harder time making ends meet.

When I would talk about affordability in general at the doorstep, when people would talk about it, there were these four distinct groups, and housing was always an issue for them. I’m going to tell a couple of stories, because I think it’s important to understand the way in which this housing affordability crisis is affecting different groups of people.

There are a number of seniors that I’ve spoken to, who have either come to talk to me in my office, or I’ve spoken to them on the doorstep. What they’re saying in the community of Coquitlam-Maillardville is: “I have lived in my house for 50 years. I’ve raised my children here. It’s a single-family house. It’s worth a whole lot of money.”

They know that the value of their house is going up. It will probably be a teardown because they have not been able to keep up with the increased costs of maintenance of their house. They are on a fixed, limited income. They are those people who are property rich and cash poor.

They are finding that groceries are becoming more expensive. Hydro — certainly, those rates are going up. Paying for their prescriptions is becoming a challenge. And even if they wanted to downsize, even if they wanted to leave the community — because in certain neighbour-
[ Page 13418 ]
hoods, they are not building higher density — they have commented that there’s nowhere for them to go.

If they want to cash out of the market, if they want to sell their house, put it on the market, increase the stock so that a family could move in, they’re saying there’s no rental accommodation for them anywhere. They no longer want to be a homeowner, right?

[1705]

At the beginning of your life, you rent until you have enough to buy, and then you go back to being a renter again towards the end of your life. I think that’s sort of the way it’s supposed to go. There is no place for them to rent.

My dad actually found this. He’s been a homeowner since 1960 and moved from Montreal — family moved to Richmond. Now my dad lives in Vancouver. He owned a townhouse. He’ll be 77 this year. My mom died a couple of years ago.

He decided that he didn’t want to be a homeowner anymore. He wanted to be able to just sort of lock the keys and either travel or just not worry about stuff and certainly not be hit with a bill — if you’re living in a strata — that required a special levy because you needed a new roof or new balconies. He wanted to have a little bit more control, because he is now retired and he has a fixed income. It’s a decent income. He has saved appropriately. He’s made some really good decisions. He’s certainly had opportunities in his life.

He wanted to rent. He didn’t want to rent somebody’s condo, because, of course, they could sell it at any time. He wanted to rent in a rental building, where he could live out his remaining years. I pray that he has many remaining years, however long they may be. But he wants to be a renter.

In his community…. He lives in Vancouver-Langara. He wanted to stay there because his life is there. His friends are there. This is where he does his activities, his shopping, his banking.

There were three places for him to look at. This is just a few months ago. This is just April. Three. Two were in very old three-storey walk-ups, with the laundry in the basement. He thought: “I’m not going to be doing that.” One made sense, and it was expensive, but my dad can manage. But there was one appropriate for an older adult, healthy adult, to live in. One. So there was nothing. There were no options.

I have those seniors in my community too. They can’t find the kind of housing that they need. There has been an absence of anything from this government to try to make that different, to try to make sure that the housing stock that does exist circulates in the right ways.

How do we make it easier for seniors to give up their 3,000-square-foot home that they no longer need. They’re ready to move to something smaller and more manageable, but there’s nothing to move to. Well, there has been an absence of influence, an absence of conversation from this government on that. They’ve been here for 15 years, and the conversation has been nothing — nada, not there, not present.

Now, in my own community, specifically when we talk about the rental stock, it’s just not keeping pace with growth. Purpose-built market rental is also nearly nonexistent.

The affordable rental stock…. Those are the older kinds of housing, the stuff that was built 50 years ago, those older four-storey walk-ups. They tended to have larger bedrooms and more bedrooms in each unit. Those are the units that the Syrian refugees are desperately looking for in all of our communities, certainly throughout Metro Vancouver. Well, those are being torn down at a record rate in my community and being replaced by market condos.

We are seeing this incredible pressure. The member from Quilchena talked about immigrants. It was very interesting. I was listening to his speech. He talked about immigrants coming over and starting off by renting. I remember immigrating from Montreal as a 14-year-old and my parents not knowing which community to purchase in. They rented in Richmond. I’d always lived in a house that they owned. We were renters, and that was interesting. It was an interesting experience.

But there is no place to rent. It makes sense. I get it. I understand what the member from Quilchena was saying. You start off renting, because you’re not sure where you want to live. You’re not sure what your income is going to be. You have to get life set up for yourself before you figure out exactly where life will be for you and your family. But there’s no place to rent.

Vancouver has a vacancy rate of 0.6 percent. In other words, there’s no place to rent. And there’s nothing here in this legislation that addresses that. Nothing.

[1710]

These seniors that I talked about — affordability is an issue for them in my community. I hear that from them regularly. I also hear from another group, and these are families with grown children. They would be families like mine, perhaps families like the Speaker’s. Our children are adult children. For many of these families, their house is paid for, because their children have now grown. They’ve had it for, let’s say, a 25-year mortgage. But their children won’t leave.

There was one house that I came across. There were six cars in the driveway — six cars. Partly because there’s no transit — but that’s a whole other conversation that I would love to have at another time — but also because there was no place for their adult children to go.

They would tell me their story. They were saying: “I don’t know what to do. I have four children. They’re between the ages of 28 and 22. They’re finished school. They’ve got jobs. There’s no place for them to go. There’s no place to rent. They certainly can’t afford to get into the market, and I’ve got four of them. How am I going to help four of them?”
[ Page 13419 ]

So they’re saying: “Do I remortgage my house to give each child a little bit of money?” But it’s not going to be enough money to get any of them into the market. This is untenable. They are saying: “Our kids can’t get launched. They can’t move forward. They can’t have a life of their own.” And they’re saying: “I want them out, because it’s better for them.”

Then there are the families that I talked to with young children. These are families that are completely stretched. They not only have significant mortgage payments, but the school fees that have been off-loaded to parents keep growing. They talk about the toll on the Port Mann Bridge that now adds to their annual costs. They talk about the increased hydro rates, the increased ICBC rates and the MSP taxes. Even taking their family camping, they see an increase. These are the families that I worry about a lot, because they can’t get ahead. And child care. That’s a mortgage payment as well. So they are really stuck.

In fact, there’s one family that is dying to come and visit us here in the Legislature. When I said we have this rare summer session that is becoming a regular…. I said: “Well, you know, the kids aren’t in school.” She’s a teacher, and he works for a municipal government. I said: “Well, why don’t you come and visit me in the Legislature?” Because they’re dying for a tour. They’re just dying to come.

Her note to me was, “Well, we’ll take a look,” and she said: “You know what? The ferry is just too expensive. We can’t afford it.” She’s a teacher. He’s working for municipal government. They make a good wage. They live in a townhouse in the community, and they can’t afford a little trip in the middle of summer to come to the Legislature. How is that? How did we get here?

The fourth group is the young renters that I’ve come across in my constituency. You see, in Coquitlam-Maillardville, there’s a handful of three- or four-storey walk-ups, and there’s one highrise. It’s about ten storeys. So any sort of affordable rental stock has really been basement suites and houses, mostly in Maillardville. It’s older stock and on large properties, and so we tend to have a lot of young renters that live there.

These are also heartbreaking stories. I think about all of the renters that I’ve come across, and there’s one that stands out, because his story was wrong on so many different levels. It just didn’t fit.

This was a young man who was hired by a Crown corporation because he has a particular specialty. What caught my attention when I walked up to knock on his door was that the car in the front had a Quebec licence plate — “Je me souviens.” I thought: “Well, you know, he’s in Maillardville. This is great. Someone from Quebec is in Maillardville. He probably wanted to come to Maillardville, right? Thinking French speaking, maybe it’s a little piece of home.” So I asked him about his decision to make Maillardville his home, because that’s what caught my attention.

He told me that he was recruited to come across the country because of this particular specialty, and he picked Maillardville because he thought that maybe he could actually afford to buy here.

[1715]

Everywhere he looked — he thought maybe Richmond, maybe Vancouver, maybe Burnaby — he couldn’t afford, and he kept going further east. He got to Maillardville, and he thought: “I am making a chunk of change. I was headhunted.” Right? He could get a salary that was needed, from this Crown corporation, and he said: “I can’t afford to buy here. I can’t afford to live in Coquitlam.”

He has a job. He’s a single person. He’s not paying child care. He has work, and he is renting a basement suite in Maillardville. He commented on how ridiculous the housing prices were — frustrated that even with a good job, working for a Crown corporation, he couldn’t afford to purchase anything, and there was almost nothing available to rent. This is someone I talked to six months ago.

What was the government’s response when we think back even just a few short weeks ago? Let’s go further back. What has the government’s response been to the fact that people have not been able to afford to live in the Lower Mainland for years? Well, in May 2015, the Minister for Housing was commenting on the fact that we were saying and others were saying that housing prices were really getting too high, that it was really a problem.

He was saying that no, housing prices were reasonable, and he’d quote, “If you look at the mean cost of housing across British Columbia” — or the mean of the Lower Mainland — “and compare it to other major cities worldwide, the reason it is attractive internationally is because it’s actually pretty reasonable compared to other cities like London, Singapore, Tokyo” — those cities.

Well, here was someone who was coming from Montreal. I think that’s an international city. I came from Montreal. It’s a pretty happening place. It’s not Vancouver. It’s why I’m still here. But he couldn’t afford a place. He couldn’t afford to live here. And the Minister for Housing said: “It’s fine.”

Well, what did the Premier have to say? She has her own thoughts. Well, in June of 2015, she said: “There are lots of great places to live. Fort St. John is booming, and it won’t be long before you see…. We need lots of new people up in Kitimat and Prince Rupert.” She was probably alluding to the LNG, which has yet to materialize. She points out, of course, that the views are amazing.

I bet she regrets saying that. These are words that are going to continue to haunt her because she didn’t appreciate what was going on for people in the Lower Mainland. “Oh, just leave the Lower Mainland. Just go somewhere else” — somewhere else where there are no jobs, somewhere else where you’re not being headhunted with a good wage. So — what? — this man from Quebec
[ Page 13420 ]
should live in Terrace and commute to his job? What a ridiculous thing to say, and how disrespectful of the people who are trying to make ends meet.

Well, let’s move forward to February 2016. That was just a few months ago. The member for Chilliwack-Hope said: “No one has a God-given right to live in a particular place.” Wow. Strong words. “No one has a God-given right to live in a particular place.” I don’t know what he was thinking. People are working hard. They’re getting priced out of a market where their supports are, where their jobs are, and that’s the best he can do?

Or what about the Minister of Finance? What does he have to say? I heard the member from Revelstoke commenting that it was just six weeks ago. Jeez, six weeks ago, he was saying that there’s nothing wrong with the housing market: “We’re actually proud of the fact that we have a jurisdiction in British Columbia that people want to come to, that they feel they can succeed in, that they want to invest in.” So he’s proud of the fact that foreign, offshore money — laundered money, perhaps — is coming into the housing market and distorting it. How lovely is that? British Columbians should be proud of that.

[1720]

Or what about this one? “Tell us about the vacancy tax. Tell us about the economic wall he and his colleagues would build if, God forbid, they were ever given the chance to govern British Columbia.” Now six weeks later, we have a tune that’s sort of changed.

Then we have the Housing Minister once again not paying attention to what British Columbians are saying, certainly not paying attention to what I’m hearing on the doorstep in Coquitlam-Maillardville. His response six weeks ago is to tell people to stop whining about housing. He said on CKNW: “I guess some people just have to get up and whine every day. I don’t know. You just have to look at the glass as half full, not half empty, right?” How condescending.

How condescending to that fellow from Quebec who’s trying to start a new life for himself in Coquitlam-Maillardville. To the parents that I talked to who are trying to make ends meet with increased affordability costs, increased Hydro rates, increased ICBC, increased MSP taxes, school fees that are loaded down on them, trying to make their mortgage payments and having to pay a toll that they didn’t used to have to pay when one of them goes to their job at the hospital in Surrey because there’s no transit — they should stop whining?

The senior who says: “I can’t keep up. My pension isn’t keeping up. My housing situation is changing. I can’t get enough home support. I have to pay for medication, or I have to pay for additional home support. I want to sell my house, but there’s nowhere for me to go to because there’s no place for me to move to because there’s no rental accommodation.” They should stop whining?

I hope everyone on that side of the House is embarrassed by those comments. It was horrifying to listen to it then, and it continues to be horrifying now. To finally see that it’s come to the government’s attention that this is a crisis is quite interesting, because I’m always interested in, sort of like: what’s the motivation? Six weeks ago, really, is not a long time ago. It’s just six weeks ago — 45, 46 days ago. So why now?

You know, as a therapist, I always say that. When people talk about, “Well, I’ve been depressed for years” or “My marriage has been bad for years,” I always say: “So why now? Why are you asking for help now? What’s the trigger?” I think about that. I think about: why is government doing this now? If we’ve been talking on this side of the House, if we’ve been coming into this House and saying this is an issue, this is a problem…. If I’ve been hearing about housing affordability in my office, I am sure that every single Metro Vancouver MLA across the way has been hearing the same thing. So why now?

Well, the government’s paying attention now because there’s an election coming. I believe that polling has perhaps suggested that this is an issue for British Columbians. I am sure they’ve spent a pretty penny on that polling. I’m sure it cost some money. They have lots of it, so I’m not really worried about the Liberals’ chequebook. But I am sure they spent a lot of money on that polling, when all they had to do was listen to British Columbians.

You didn’t have to do polling. I could have told you. I think we did tell them. I think we told you. I think we said to the government this is an issue. But they don’t trust us, and they don’t trust constituents. They actually had to get out and do the polling. Let’s get the data on this.

I could go out on a Saturday afternoon and knock on a couple dozen doors and knew right away that that’s the issue. It doesn’t take rocket science. It doesn’t take polling. And it shouldn’t take an election to finally wake up to this issue.

What does this tell us? This tells us that this government, I think, doesn’t really care about the housing affordability crisis. It’s time to come clean. They just care about getting re-elected. They have less than 300 days, and now they have the polling data that tells them that they ought to do something so that it looks like they care.

I even noticed the language of the government tweets when we were called back to this rare summer session. The language changed, and it was very, very interesting. It was really subtle. It was the Premier’s Twitter account, and it said something like: “We’re having a rare summer session so we can continue to address the housing affordability crisis.” Continue to address. Continue? Continue what? You haven’t even started.

[1725]

But it’s the messaging. It’s about: we have to start making it look like we’re actually doing something. It’s that meme. It’s like capturing the message that we are on it. We are on this housing thing. Well, I guess that’s what the Premier and her communications team want her to
[ Page 13421 ]
do and want everyone on this government side to do. They want to make it start looking like they’re actually doing something. I think that’s the motivation behind this legislation.

What does the proposed legislation actually do? Well, there are four things in this legislation. There’s addressing the foreign nationals, charging them a property transfer tax of 15 percent on residential property purchases in Metro Vancouver — so foreign nationals. That means people who come from away, if I can use a Newfoundland term. They come from away. They are going to have to pay this tax should they purchase a home.

I heard this example used, and I thought that it was a good example. It’s that professor who comes for three years, or somebody is headhunted, like this fellow who came from Quebec. Well, what if he came from New York to work for a Crown corporation? What if he didn’t come from Quebec? What if he came from the U.S. or came from China or came from India? We’re recruiting him, and now we’re going to charge a surtax.

I thought that was interesting. And it’s not about the money. It’s about the citizenship. I thought that was just really interesting. Why wouldn’t it be about the money? The money is the issue: where’s the money coming from, not where the people are coming from.

Then there’s this other part that I find is really interesting. I had a chuckle when I read this part. The new tax will take effect August 2. So six weeks ago it wasn’t an issue. In fact, it was just whining from a bunch of people. Now we’re going to get ’er done, and Tuesday it comes into effect — Tuesday.

The idea that it’s going to move that quickly suggests to me that they need to make it look like it’s happening really fast — really fast. The only other person I think of that talks about things happening really fast is Donald Trump, because he talked about that in his speech — really fast.

I’m aware of time passing, and there are three other pieces that I’d like to just quickly make mention of.

There’s the creation of the new housing priority initiatives fund, and that’s for a provincial housing and rental program. They’re seeding it with $75 million. Well, that’s going to build 75 units of housing. I’m not quite sure how that’s going to make a difference.

Then there’s fixing the problem that they created, which is ending the self-regulation of the real estate industry. Well, let’s be really clear. This problem only exists because this government chose to deregulate, and this is what happens. It’s time to clean up their mess.

Now, the fourth thing that this legislation is going to be doing is making amendments to the Vancouver Charter to provide Vancouver, and only Vancouver, the authority to implement a vacancy tax.

This is one I find incredibly interesting. I heard the Finance Minister say that the reason he’s offering this to Vancouver is because they asked. They asked. I thought: “Well, Vancouver has asked also for the enabling legislation that would allow them to address the election finance reform for Vancouver because they have a problem there with that.”

The message they got back was: “No. We govern the entire province. We’re not going to give you special opportunity.” But here, in this case, it’s: “Well, because you asked.” Then because it’s just enabling legislation, other communities are saying: “Well, what if we want to do that? Maybe that might be an opportunity for us.” They are told no.

I appreciate the opportunity to speak to this bill.

D. Bing: It is an honour and a pleasure for me to rise in this House on behalf of my constituents of Maple Ridge–Pitt Meadows.

[1730]

Let me begin by saying that the quality of life for all British Columbians is a top priority for this government. Purchasing a home in our beautiful province, one of the most important investments that a person makes for themselves and their family, should be protected and fair. This is a concern that I hear from many of my constituents, and this is why it is very important to me that we do something about it.

I’m happy to note that our B.C. Liberal government is taking real action. I’m proud to rise in the Legislature today to vote in favour of Bill 28, the Housing Priority Initiatives Amendment Act.

[R. Chouhan in the chair.]

The Premier noted a few months ago that our strategy for affordable housing in B.C., particularly in the greater Vancouver region, must have six fundamental principles: (1) increasing the housing supply, (2) smart transit expansion, (3) supporting first-time homebuyers, (4) consumer protection, (5) increasing rental supply and (6) protecting the dream of home ownership.

Since the Premier announced our guiding strategy on affordable housing, we have taken action to ensure that the steps laid out become a reality. Bill 28 creates new measures to help make home ownership more affordable, establishes a fund for market housing and rental initiatives, strengthens consumer protection and gives the city of Vancouver the tools it requested to increase rental property supply.

An additional property transfer tax of 15 percent will help manage ongoing demand in residential real estate while the housing market responds by building new homes to meet local needs. Placing barriers to foreign investment in the GVRD real estate can help manage rising prices while supply catches up.

We are accepting all of the recommendations made by the B.C. real estate advisory council to take action against shady practices and challenges plaguing the real estate market, particularly in the Lower Mainland. Our recent
[ Page 13422 ]
actions mean that the Real Estate Council will no longer have the right of self-regulation. Instead, a new superintendent of real estate will have the ability to carry out the changes required to restore public confidence, such as increasing fines for unlicensed activity and other offences. We are ensuring that those being regulated won’t have a majority on the Real Estate Council.

In my own community, our government’s work has made a real difference in the lives of homeless British Columbians by partnering with our municipal counterparts. We provided approximately $550,000 in funding to RainCity Housing and Support Society to operate a new 40-bed shelter in Maple Ridge and provide the necessary support services to those in need in the community. The temporary shelter provides immediate housing solutions for the individuals who are living in a homeless camp on Cliff Avenue in Maple Ridge.

Our partnerships with all levels of government to address affordable housing issues in B.C. are starting to result in concrete proposals as well as action. Our current housing challenges are real, which is why we must continue making real changes. We are headed in the right direction, but there is absolutely more work to do. These are complex issues that will require a number of different solutions.

Our government is demonstrating real leadership on these issues while the NDP is leading from behind. British Columbians can literally not afford the type of inaction the NDP is proposing. That is why our B.C. Liberal government will keep working to ensure that the dream of owning a home stays within the reach of the middle class in British Columbia.

G. Heyman: I’m pleased to stand to speak to Bill 28. I’d be even more pleased if we had addressed this issue a number of months ago or a year ago or a couple of years ago. I’d also be more pleased if there was more substance and meat to the bill before us. But I will say, as my colleague from Vancouver–Point Grey and others have said, this bill is better than what we have today.

The bill is called Miscellaneous Statutes (Housing Priority Initiatives). It’s about time we had some housing priority initiatives in this Legislature, in this province. The benchmark price for a home in Metro Vancouver increased by 32 percent in the last year.

[1735]

Think about that. Vancouver has always been a hot housing market. It has been a market in which people have thought for a long, long time — years, perhaps more than a decade — that house prices in Vancouver were astronomical, that they couldn’t have gone higher, and yet they keep going higher. In the last year, 32 percent.

That results, not just for me but for many of my colleagues representing constituencies in greater Vancouver, in Metro Vancouver and, I suspect, for others on the government side of the House, who might not talk about it as much…. We see angst. We see concern in our constituents.

I regularly have people come into my office who I assume are there to talk about housing. They’re actually there to talk about their kids’ education, but the housing crisis is so much on their mind that that’s what they talk about for the first ten or 15 minutes of our visit.

They talk about the impact on their family. They talk about their desire to move, perhaps to have a bit more space if their family is growing, but they’re feeling that they can’t afford it. They still want to remain in the neighbourhood where their kids are growing up and going to school and where, perhaps, they themselves grew up and went to school, and yet they’re being priced out.

Let me just read the first paragraph of a letter that’s fairly typical. It’s an angry letter I received from a constituent. I won’t use the constituent’s name because I haven’t had an opportunity to get the constituent’s permission. It says:

“Hello, Mr. Heyman.”

I guess I can’t use my own name either. I apologize.

“I’m sure you’ve received plenty of emails concerning the state of the B.C. real estate market. I’m writing you today because in the last two years, I’ve made the most money I’ve ever made in my life, and I can’t buy a home. I’m priced out. If I did manage to get into the market, I would be house-poor.

“I’ve lived in B.C. since 1997 and spent most of that time in Vancouver. I contribute to our community. I along with other citizens that have lived here for many years are the reason Vancouver is the best place to live in the world. We built this city, and now we can’t afford it.

“The influx of foreign investment is enticing for many, but for many more, it is a roadblock to the Canadian dream. Where is this money coming from? How is this money made? Does the government have answers to these questions? I don’t believe we should welcome investment without understanding how it came to be.”

Hon. Speaker, I’ll return to this point in a moment, but note that the constituent, the writer, astutely talked about investment and not citizenship. That’s an important distinction, and it’s one that is not made in the bill that we’re debating today.

Others of my colleagues have spoken at some length about our frustration on this side of the House and, I have to say, the frustration of our constituents, as well, at hearing the issues of housing — the low rental vacancy rate in Vancouver, in particular, but throughout Metro Vancouver, the difficulty in finding real estate that people can afford and their desperation at wondering if they’re losing their last chance to ever own a home in Metro Vancouver — and also in the south Island, in the Interior as this out-of-control price surge travels the province.

For months we received disdain from the other side of the House. We received incredible statements that the investment of foreign money driving up the cost of real estate, in Metro Vancouver in particular, was actually a sign of a healthy B.C. economy, that we should welcome it, that there weren’t problems, that people who were raising the issue of affordability or access to housing were whining, that we didn’t need to keep statistics more than
[ Page 13423 ]
we kept, that the actions of the self-regulating Real Estate Council were just fine.

When it suits this government, when this government believes that an issue has spiralled out of control and could be costly to them, they’re very quick to pivot or, as columnist Michael Smyth noted today in the Province, very, very quick to flip-flop.

[1740]

What we see before us today is a bill to address a number of issues, but unfortunately, address them inadequately, address them, in some ways, from the wrong direction and somewhat offensively act as if the moral authority now rests with the government side that has taken prompt and concrete action, as they would say, to address this issue — as if the opposition, as if constituents of all of ours on both sides of the House, as if MLAs, as if members of the public, as if columnists and commentators, as if even the Bank of Canada hadn’t raised this continually as a significant issue, a potential threat to markets and equity. This government finally has taken haphazard action.

The Premier was quoted in the paper recently as saying that you can’t draft these kinds of provisions on the back of a napkin. It takes careful thought. But it seems pretty clear that there wasn’t a lot of thought put into this — and particularly not put into these measures over a long period of time.

Let’s talk, first of all, about a couple of the issues that are being addressed by this bill. The first one is the property transfer tax of 15 percent on foreign nationals. My colleagues before me have said clearly, and experts in housing from universities have also said, the issue is foreign investment, not the nationality of somebody who chooses to buy a home.

Somebody may come to Vancouver, as was stated earlier today by the member for Vancouver–Point Grey, because they have found a job or they’ve been recruited to a good job. They may plan to stay for three years, for five years, for six years, for seven years. Perhaps they think if they really like it here, they may stay their whole life and, at that point, choose to make a decision about permanent resident status or citizenship. But for the time being, they simply want to live, work and pay taxes in British Columbia.

Under this bill, they will pay taxes all right. They’ll pay an extra 15 percent tax that won’t get to the root of the problem, because they aren’t the root of the problem. They’re living in Vancouver seeking accommodation. They are not shovelling speculative investment money into British Columbia without paying taxes in British Columbia, without living in British Columbia, while driving up the price of real estate for people who wish to purchase homes and live in British Columbia, in Metro Vancouver.

We’re now seeing a spillover effect to Victoria and the south Island. We’re seeing knock-on effects in other parts of the province. This is spreading. Many people have told this government that the issue is one of investment, non-resident investment that is driving up prices. There are related issues. It’s the source of the money. There are suspicions of money laundering. There are suspicions of tax evasion.

Commentators have said, for instance, on the radio that the Chinese government has no interest in seeing capital flight from its country, which is the source of much of the investment money in real estate coming into this province — so many people say — and that the Chinese government would readily work with the British Columbia and Canadian governments to find ways to stem this. But this bill does nothing to do that.

This bill simply says if you’re not a citizen or a permanent resident, you will pay a 15 percent property transfer tax. That simply won’t address the issue, not to mention the number of loopholes that could be available — investors channelling money through citizens or permanent residents, through corporations that are set up to accept that investment and then continue to drive up real estate prices.

This tax will have some effect, but it does not get to the root of the problem. The root of the problem is real estate investment speculation with money which, in many cases, is untracked, inappropriately tracked and suspect.

[1745]

This has all the earmarks of addressing the issue for people who don’t scratch very far below the surface, but what British Columbians and residents of Metro Vancouver really deserve is a well-thought-out approach that gets to the root of the problem. This simply doesn’t do it.

Another feature of the bill is a housing priority initiatives fund for provincial housing and rental programs. It says the fund will start with $75 million and, going forward, will receive a portion of revenue from the property transfer tax, including the new foreign buyer tax. But it doesn’t say all the money from the foreign buyer tax or a significant portion of the property transfer tax.

Interjection.

G. Heyman: I’m glad that the Minister of Environment is amused, but this is a real issue for British Columbians. A real issue for British Columbians is access to housing, access to affordable housing, access to rental properties, and that’s what I and others regularly hear in our offices.

We hear of people being evicted and having to go on the market looking for rental housing and actually having to bid against others. Much as people who are seeking to buy a house have to bid up the price to have a chance to get it, people are now having to bid up rents in order to have a chance to find a place to rent. That’s a problem for them. It’s a problem for people who want to live in Vancouver, who grew up in Vancouver, but it’s also an economic problem
[ Page 13424 ]
for the Lower Mainland.

Many employers in the tech sector as well as other sectors have approached me about the dual problem of trying to attract and retain their employees when they can’t find housing or they can’t afford housing, and if they choose to live further out in the suburbs of Metro Vancouver, they can’t efficiently get to work because this government has simply ignored the need to expedite the development of rapid transit in Metro Vancouver by working with the mayors to do so.

We need to see a more concrete commitment to investment in provincial housing and rental programs. This government has abandoned many opportunities to do that. The Housing Minister has spoken in this House about how they’re getting out of the social housing business or are out of it, and simply provide money for shelters for short-term and emergency shelters now. That’s the wrong direction for affordable housing.

The other thing that this government could have done would be to work with and urge the federal government to reinvest in co-op housing programs and non-profit housing societies in order to help address the issue of affordable housing in Metro Vancouver and elsewhere in the province, but it hasn’t done that.

Further, to add insult to injury, this government, where it has publicly owned land that could be made available for co-ops, for non-profit housing, on long-term affordable leases or even sales that were specifically designated for affordable housing and rental housing — although that, in my view, would not be necessary — sold them off at cents on the dollar in order to balance the budget in the first couple of years of this term.

I won’t need to go into detail on some of the well-below-market-value sales that were indulged in by the Finance Minister in order to make the books meet the target, but there were far better uses for those lands in the public interest, and this government owed it to the public to make the best use of those lands, not for short-term political gain. And they simply didn’t do that.

Another feature of this bill is the Premier claiming: “We are cracking down on shady practices in the real estate industry. We will end self-regulation.” End the self-regulation that was brought in by this government in the first place with spurious claims that self-regulation would lead to better protection of the public while reducing so-called red tape.

[1750]

Instead, it has led to a plethora of shady real estate practices to the shame and dismay of honourable realtors, who don’t like to see their profession brought down in the public eye by the disreputable actions of some.

Let me use just one example from my constituency. A woman in her late 70s in my constituency was approached by a real estate agent a few years ago. She was urged to sell to this agent in a private sale, because the agent said: “I love this home. This would be perfect for me. Even my dogs would love romping in the backyard of your home.”

This woman, who was looking to downsize and find a place that she could live in without facing the maintenance of a detached home with a yard — although one she had lived in and loved for many, many years — was tempted by this agent, because she wanted the home to go to someone who would love it and care for it. The agent promised to be that person.

In less than four weeks after that sale closed, the agent flipped the home to a realtor with whom she had a relationship for a 25 percent increase, or about $400,000 profit — in four weeks. That’s the kind of action that self-regulation brings you, and it is great that this government has finally discovered that their reliance on self-regulation for real estate simply had to be ended. There are many other examples where this government’s reliance on self-regulation should also be suspect and also called into question. We’ll see what it will take for the government to address those problems.

The real estate industry itself — many realtors, at least — believes that things have gone too far, that there are too many realtors looking for a quick buck, or a quick 400,000 bucks, and that things need to be brought to heel.

Let me turn now to the issue of amendments to the Vancouver Charter to provide Vancouver with the authority to implement a vacancy tax in order to make more rental stock available by ensuring that people have a big incentive to rent their vacant properties.

This has been requested by Vancouver. It’s being welcomed by Vancouver. However, the mayor of Vancouver also says that they need provincial assistance with data in order to help design both a tax and a tax implementation regime that can be effective. But this is a good move, and I see the government has responded quickly to the requests of the city of Vancouver and the city of Vancouver’s mayor.

It’s not just the city of Vancouver and the city of Vancouver’s mayor who have asked for this assistance. The mayor of Oak Bay, the mayor of Victoria and other mayors have said: “Wait a minute. Amending the Vancouver Charter doesn’t help us. We would like to see this right extended to us.”

While I acknowledge that the government has left within its power, by regulation, the right to impose a vacancy tax to other municipalities, this legislation was drafted so hastily that they chose not to do it today. They chose not to do it in this sitting. They chose not to do it in this bill, and by doing so, they have created two classes of municipality in this province. One might argue that there already are two classes, but regardless, this government has perpetuated that, and it will be some time before we know if concerns being raised by mayors in the south Island or, potentially, by mayors in other parts of Victoria will have the same response from this government.

There is a real fear that some of the features of this bill
[ Page 13425 ]
will actually drive real estate speculation to other parts of the province, causing housing crises in those parts of the province, whether it’s the south Island, Victoria, whether it’s Kelowna, whether it’s other areas of British Columbia.

[1755]

It is a real problem that this government apparently has not clearly thought out or clearly come to terms with. What we don’t need to do is to take the crisis that’s now facing Metro Vancouver in a huge degree, and facing other parts of British Columbia to a somewhat lesser degree, and expand that horrific impact of affordability or lack of rental accommodation to other parts of the province.

It is very, very interesting and instructive, as I mentioned earlier, to look at some of the claims and statements by this government over the past number of months, as my colleague from Point Grey and my colleagues from other constituencies around the province have attempted to bring the government’s attention to the housing crisis, the affordability crisis, the lack of rental stock and other issues that concern my constituents and concern their constituents and, I expect, concern the constituents of the members opposite.

When you look at some of the statements, you have to wonder what members of the government side were thinking when they made them and how they managed to do the mental gymnastics to justify the complete flip-flop that this bill represents.

Let me start with some quotes from the Minister Responsible for Housing. In May 2015, the minister said: “If you look at the mean cost of housing across British Columbia or the mean of the Lower Mainland and compare it to other major cities worldwide, the reason it’s attractive internationally is because it’s actually pretty reasonable….”

I’ve quoted this to constituents who have come to my office to talk about the affordability issue and the cost of housing in my riding of Vancouver-Fairview, and it is a moment of comic relief for them. They can’t believe that anybody could actually make a statement that the cost of housing in the Lower Mainland is actually quite reasonable when it clearly isn’t, it hasn’t been for a long time, and over the last year, we’ve seen it skyrocket by over 30 percent. What a ludicrous statement.

The minister went on to say on the same day: “There’s no initiative at this time in government to go and interfere in the marketplace with regards to housing.” Okay, I guess something changed there. “There is no initiative or research that we’re doing from this ministry with regards to that.”

That was about a couple of months ago. Apparently the government has now done adequate research in two months — or perhaps in 26 days, judging by recent statements by the Finance Minister — to put together a comprehensive plan to actually interfere, as the minister said, in the marketplace with regards to housing, to control an issue that is a real issue of both accommodation and shelter for people in British Columbia. But for this government, apparently, it isn’t an issue until it becomes a political issue.

Then we have the Premier who, in June, said that if you can’t afford to buy in Vancouver, you should just leave. She said: “There are lots of great places to live. Fort St. John is booming.” Well, I’ve been to Fort St. John, and the people there don’t think it’s booming, but the Premier can believe that if she will, or at least try to sell it to the rest of the province. She says: “And it won’t be long before you see…. We need lots of new people up in Kitimat and Prince Rupert.” Last time I checked, people in Kitimat were still waiting for the promise, a bonanza from the 2013 campaign by the Liberal government, and they have yet to see it.

Leaving all that aside, if the government doesn’t want to interfere in the marketplace, then it shouldn’t, certainly, interfere in peoples’ family lives and their choices of where to live, where to find employment or whether to stay in the place where they grew up, where they were raised or where they’re choosing to raise their kids.

[1800]

Many people need to live in Metro Vancouver because that’s where there is work for them. That’s where they’ve been recruited. And many, many employers, as I said earlier, have said: “We’re having trouble recruiting. The cost of housing is too high, and it’s making it difficult for us. We can’t compensate people for the level of the cost of housing.” There is no relationship between the cost of housing — and now there is getting to be no relationship between the cost of rental accommodation — and people’s incomes.

That is a result of real estate investment and speculation driven by foreign money, not by foreign nationals, necessarily, who live in Vancouver, work in Vancouver, live and work in other parts of the province and pay taxes to British Columbia and Canada but people who aren’t here, pay no taxes here and simply choose to use real estate in Metro Vancouver and on the south Island and in Kelowna and, potentially, other parts of the province as a way to either launder money or get rich.

That is the problem. It’s hurting the economy. It’s hurting the ability to recruit and retain. It is one of the reasons, along with the issue we raised earlier today about the lack of the proper educational supports to graduate people in engineering, graphics, animation and computer science, skills that drove Vancouver from fourth to 14th in availability of trained tech talent in a mere period of three years between 2012 and ’15…. That is the result of this government’s failure to address this issue before it spiralled out of control.

Let me turn to the Finance Minister. May 2016. We’re actually proud of the fact that we have a jurisdiction in British Columbia that people want to come to, that they feel they can succeed in, that they want to invest in. On the one hand, the Finance Minister, a couple of months
[ Page 13426 ]
ago, says they’re proud of this and they don’t want to intervene and, two months later, actually penalizes people who come here to work and fails to necessarily penalize people who come to invest.

He went on to say: “Tell us about the vacancy tax. Tell us about the economic wall he and his colleagues would build if, God forbid, they were ever given the chance to govern British Columbia.” Well, apparently, the Finance Minister has just demonstrated what this government would do as a wall. Unfortunately, the wall is in the wrong place. The wall is walling off people who want to come and contribute to B.C.’s economy and live here instead of a wall that blocks investment from people who won’t live here but want to make it difficult for the people who do.

I will vote for this bill, but British Columbians deserve a bill and an act that go far beyond the meagre offering that has been put forward by the Premier and Finance Minister with this bill. With that, I’ll take my place.

R. Sultan: I rise to speak in favour of Bill 28, the government’s initiative which strives to somewhat lower the temperature of Metro Vancouver’s real estate market — underline “somewhat” — and also generate significant funding to create affordable housing for citizens as well as facilitate Mayor Gregor Robertson’s scheme to tax vacant housing in the city of Vancouver and crack down on unethical behaviour in the real estate brokerage industry.

Seldom does this House deal with an omnibus bill of such variety, importance, ambition and immediate need. The common theme, of course, is the extraordinary development of the Vancouver real estate market over the past year or so as it has accelerated. The bill is particularly timely from my perspective of the riding of West Vancouver–Capilano, where some of the more astonishing and aggressive bidding and multi-million dollar price escalation has occurred with higher-end properties, bidding for detached homes prominently but not singularly driven by offshore interests.

I should also say that ownership by people from abroad….

[1805]

Deputy Speaker: Member, would you please move to your own seat to speak.

R. Sultan: I’m sorry. I’m at the wrong desk.

I seek leave of the House to continue from where I was.

As I was saying, the phenomenon we see in my riding is not a particularly new one. We have grown quite used to people living in grand homes, who are, shall we say, citizens of the world. They come, and they go. They pay their taxes. We sometimes get to know them well. Sometimes, we get to know them hardly at all. This surge of new interest of foreign buying into my particular riding is not something that we’re not used to. But, certainly, the scale and the aggressiveness of the development in the last year or so has been unusual.

As we all know, the Ministry of Finance, compelled by the need to make policy on the basis of facts rather than anecdotes, took the tedious step of actually collecting the numbers — the collection of which, by the way, the folks on the opposite side, as I understand it, had previously cancelled — and recently reported the facts about the flow of largely offshore money into the Vancouver real estate market — facts which, in fact, verified the suppositions that had been presented.

We now appreciate that the flows are, give-and-take, in the approximate magnitude of $1 billion a month — surely a significant sum by any standard. Much of this appears to originate — certainly, I’m sure does originate — from mainland China where, according to international monetary authorities, about $1 trillion of capital is being exported annually.

As that flood of money seeking safety, portfolio diversification, reasonable investment return, honest government, and fair taxation looks around the world, Vancouver has become a top-tier destination, even if our absorption capacity may represent less than 1 percent of the outflow.

What is our attraction? Well, they are plain enough. Very low income taxes, by international standards — lower than the U.S.A. A provincial government which is careful in the expenditure of taxpayer moneys — what we call fiscal prudence — combined with honesty, transparency and a healthy, well-balanced, challenging democracy, as we see in action in this House.

And telling the member from West Vancouver to get into the right place if he’s going to give a speech, or else.

High rates of economic growth compared with the rest of Canada — high rates of not just economic growth but job growth, compared with the rest of the country. A vibrant multicultural society where partitioning, hatred, envy, violence and discrimination are seldom found.

Strategic positioning as the most obvious crossroads between North America and vast Pacific nations and markets. A trading nation and a trading mentality. A welcome sign out for foreign capital. And a glorious, environmentally pristine, geographically spectacular physical setting.

What’s not to like? I’m taking my money and heading for Vancouver. And if I’m not even going to be there myself, I’m going to put my money there. Should we blame the world for reaching this conclusion?

What does the accurate data show? Updated numbers on foreign investment show more than $885 million in foreign investment flowed into Metro Vancouver’s residential real estate market in just five weeks, representing 86 percent of the capital invested in the real estate sector by foreign purchasers throughout the province.

[1810]

Since June 10, buyers have been required to disclose whether they’re Canadian citizens or permanent resi-
[ Page 13427 ]
dents of this country — and if not, their country of citizenship. By collecting this new information, we’re in a better position to monitor the magnitude of foreign ownership and investment in the sector and judge whether their impact is real or conjured up.

Well, now we know from the facts, not just from our impressions, that it is certainly real. It is real, although a long, long way from being the dominant or majority factor. It seems to be something like 15 to 20 percent of the market that’s represented by these types of capital flows — 80 to 85 percent is not — non-citizens and non-permanent residents combined. In Richmond, 18 percent. In Burnaby, 18 percent. Not as high in the city of Vancouver.

The government’s chosen instrument was to declare that those who were neither citizens nor permanent residents shall pay an additional 15 percent property transfer tax. Since Metro Vancouver property prices, under one popular index, climbed 30 percent in the last 12 months, the government taxing back half of that gain still leaves the seller of a typical property with a 15 percent gain in one year — or has in fact taxed that back from the purchaser, all other things remaining equal, although assuredly they will not remain equal, I’m confident.

What will happen with the new tax revenue? Well, let’s not be naive. One possibility is that it will tend to dry up. There will be international repercussions to what we have done so abruptly. But assuming we do collect perhaps another couple of hundred million dollars — which perhaps could be on the modest side — the province is working on a number of other fronts to help plow this money back into the housing affordability issue, including increasing housing supply; smart transit expansion, as our minister in charge of TransLink explained earlier this afternoon; and supporting first-time buyers.

More news will be released on these topics, I believe, in the weeks ahead. This is only the first shoe to be dropped. Standing back, the government has — sensibly, in my view — acted to blunt the sharpness of the rise in demand in order to give time for measures to increase on the supply side and to respond.

The government is working on a number of other fronts to help address housing affordability, including increasing supply through bringing pressures to bear on zoning restrictions — the common number quoted in the media of proposed, maybe quite far along, projects in Vancouver city of about 65,000 stalled in the pipeline somewhere — and, secondly, making it possible for first-time buyers to get into the market through some creative innovations in finance yet to be spelled out.

Smart transit expansion. The capital value jump around transit hubs would be somehow exploited to help provide affordable housing for people in buildings concentrated in those particular hubs, which means when all our citizens look for affordable housing in the future, they should more easily find it. Who’s not in favour of that? Well, one Vancouver Re/Max real estate agent on television yesterday observed that, in fact, everybody he knows is in favour of affordable housing until it comes time to sell their house — which is a commentary, I’m sure, on all of us.

The whole episode has generated what have been, for me, several delicious moments. The first delicious moment for me was watching the Housing critic for the opposition discover reported poverty and complain about it, particularly when it was associated with people living in $5 million houses. He belongs to a political party which relished, savoured, bathed in and freely sprinkled around the accusation that B.C. has the worst family poverty levels in Canada. Week after week, year after year, in this Legislature, it was their bread and butter in question period.

[1815]

Where was he back in November 2010, when I published my report revealing the highest reported family poverty levels of all were in Richmond and in my neighbourhood of the British Properties in West Vancouver? Didn’t that seem a bit strange? If he wants to look it up, it’s still on my website.

I made a personal visit down to Adrienne Montani and First Call, operating out of that magnificent BCTF building close to False Creek — full of hard-working union staff in Vancouver. First Call was and still is the originator of these annual denunciations of poverty in the British Properties and in Richmond. I reported my curious findings to her and her team, but they ignored me. They have found their shtick, and they are sticking with it.

A second delicious moment concerns the appetite for an affordable housing community by a community in my own riding, to point the finger at myself. We are quick to lament the fact that many of our civic employees and school teachers, for example, can no longer afford to live on the North Shore. Heaven knows what will happen if there’s a major seismic calamity and people cannot get back and forth across Burrard Inlet. But please don’t suggest basement suites, laneway houses or higher density of any type. We want our community to stay pretty much just the way it is right now. Unfortunately, there is some inconsistency about what we say we would like to see and what we are actually willing and agree to see at the end of the day.

[Madame Speaker in the chair.]

A third delicious moment for me concerns our adjoining large city. Delicacy suggests me not to really name it, but it is a community where many of the people who work on the North Shore live, and it’s a community that’s been particularly impacted by the surge of foreign investment driving up prices. Although subject to these housing pressures, the city fathers of this particular community display an unusual aversion to low-income housing in any form. Many of us will watch with keen interest
[ Page 13428 ]
the activities of the new housing priority initiatives fund, as it may or may not apply in this particular city.

The final delicious moment for me was watching the opposition argue their Sauder School model of differential taxation targeting the offshore based on a 2 percent annual tax going into effect next year, in comparison with our new law — the 15 percent one-time tax — going into effect next week. With a straight face, I admire him for sticking to his guns. The critic argued the first would certainly be superior in impact to the second. A delicious moment.

Our government’s new housing priority initiatives fund will set aside revenue raised by the new taxation measures to increase the stock of affordable housing based on an initial investment of $75 million. That fund may, in due course, grow by several hundred million. Whether it does, of course, depends on how successful you are in presenting a continued welcoming tax environment to those wishing to invest here from other lands. If there aren’t any property transfers in the category, there won’t be any income to fund affordable housing from that particular pot of money.

Again, let us be realistic. This is a significant intervention in the free marketplace and will be viewed as such in the London Economist and Bloomberg news. It’s a significant departure from the philosophical underpinnings of this government and the signals we like to send. How it will be viewed abroad remains to be seen. I think that I at least — and I suspect we — would deeply regret if a lot of offshore capital decides to go somewhere else. Yes, I want to save my cake and eat it too, just like the rest of us.

[1820]

In sum, the Finance Minister and staff have created a masterful piece of legislation, delicately balanced. Success is not assured, and I think he’s quite free in that confession. But it appears to be a reasonable tweaking of the demand side, buying some time, which should allow the supply side, if given some provincial government help, an opportunity to catch up — all with the goal of helping solve an important housing issue which could no longer be ignored.

V. Huntington: I appreciate, as always, hearing the words from the member for West Vancouver–Capilano. I very much appreciate the official opposition for allowing me to bump into their lineup, and I appreciate this opportunity to speak to Bill 28, the Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act of 2016.

I’m pleased the government is finally inching towards the tacit recognition that their lack of action on housing affordability has been woefully inadequate. The fact we’re here at all is a clear indication that they lost control of this issue and that their political interest demanded positive action.

I will say right at the start that this fiddling around the edges of a major social problem is, in my opinion, insufficient. It is apparent this government has yet to recognize that the public have far more at stake and have many more concerns than will be addressed by this exercise in tweaking a property transfer tax.

The issue of housing affordability has been at a crisis level for a year now, and people across Metro Vancouver have been crying out for action from the provincial government.

I repeat: this is not an issue that just appeared out of nowhere. We had an extensive spring session where government had every opportunity to take swift action, where government was told time and again that a social crisis was unfolding, where government ignored the signs, ignored the people, ignored advice, not just from this House but from academics, journalists and the people themselves, and where government diddled around in an effort to protect their foreign source of money, a foreign and false propping up of our economy, a windfall for the public purse.

Amidst the public angst, all this government did was sit beside the trough and lap up the banknotes as they came streaming in from overseas. It only did something when it realized the money was so significant that the people were right: something was desperately wrong with the normal laws of supply and demand.

Even then, the government fell in line with the developers in B.C. “It’s not the foreign money with no limit that is driving the price. Oh no, it’s the lack of supply. It’s local governments’ fault. Let’s build. Let’s build more and keep on building.”

Is there any doubt in this place that the Premier’s assurances that more is to come will be provincial regs forcing development and density upon the local governments of this region? This is not a supply problem. It’s an abnormal demand problem, a demand that has upset the balance of income and purchasing power, that has upset all vestiges of fair play and of success through effort and opportunity to own a home and even rent a home.

In the last year, the housing prices in Delta South have risen close to 50 percent, the highest jump in this region. I have been inundated by people in my office, one of whom followed by sending this letter. I am going to read it to this House.

“I want to share my thoughts and concerns with you regarding the current state of the real estate market in our province. It’s well documented in the media that foreign investors are buying the bulk of real estate in Vancouver and Toronto as safe havens. It has created a situation where young people and young families in these regions are unable to afford a home.

“There are many examples of homes in the Lower Mainland of British Columbia being sold for substantially more than the asking price, primarily to foreign buyers. Unfortunately, this is the new norm, which is ignored by government officials. Here are my concerns resulting from the current state of the real estate market.”

And this is why I am reading this letter.

“Marginalizing young people, resulting in stress and anxiety to levels that will be unprecedented and most likely followed by despair and apathy.

“Resentment towards foreign buyers as they not only have a great
[ Page 13429 ]
deal of money but are spending it at a 25 percent Canadian dollar discount, as well as enjoying a much more favourable tax system than we have in our country. This has created an unfair advantage for our young citizens to buy real estate.

“Disrupting community and neighbourhood relationships, as there are a number of empty houses that are owned by foreign interests. Could we see a depletion of family services and school closures in these areas?

[1825]

“Many house sales are cash deals from offshore, which ponders the question: how is the money being brought into this country? Are there not rules and regulations associated with money transfer? Houses will continue to be traded as a commodity, traded as if it was a futures contract, ignoring the concept of pride in ownership that our young people normally have.

“I am a retired teacher and have a sense of fairness and a belief of equality for our citizens. I like to think that government, as well, has a conscience and has concerns over young Canadian families who would love to purchase a home, raise a family and follow their dreams. The current environment of fear, greed and insensitivity could create barriers among our citizens, where the spread between rich and poor could eventually create violence and prejudices beyond our control. This would be devastating for Canada.”

I believe this writer is correct, and I read these words because they basically sum up my own.

I recognize, Madame Speaker, that given the time, I reserve my place and move adjournment of the debate.

V. Huntington moved adjournment of debate.

Motion approved.

Hon. M. Polak moved adjournment of the House.

Motion approved.

Madame Speaker: This House, at its rising, stands adjourned until 1:30 tomorrow afternoon.

The House adjourned at 6:26 p.m.

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