Victoria Council recently targeted foreign buyers as the cause of rising housing prices, resulting in a 15% tax if approved by the province.
Foreign purchases in Victoria represent only 6.3% of all sales.
According to CMHC CEO Evan Siddall, it may be convenient for politicians to use foreign buyers as a “scapegoat” for rising prices, but it is both factually wrong and divisive.
He says slow and obstructive municipal processes are significant contributors to a lack of supply and affordability.
Housing supply is being choked between the ALR and municipal regulations/anti-development groups in our urban areas intended for housing.
Victoria Council has demonstrated a reluctance to support density in its own community plan, especially in the face of vocal anti-development groups. The result is long delays and higher housing costs, if the project is approved at all.
Rather than address obstructions to supply, Victoria’s resolution puts the blame squarely on home-buying customers.
Nobody blamed foreign buyers when housing prices increased $135k or 41% from 2003 to 2005 after a period of stagnation.
Historically, prices jump after stagnation, which Victoria experienced prior to 2014, resulting in today’s 24% increase.
In addition, Victoria plans to boost their development fees by up to 143%, which will most certainly impact home prices..
Not all regional politicians support a Foreign Buyers Tax. Langford Mayor Stew Young calls it a “modern day head tax.”
Langford has the region’s most progressive, affordable development policies enabling young families to purchase new homes.
The BC govt should reject Victoria’s resolution and suggest Council follow Langford’s example of improving efficiency and supply, rather than look for “scapegoats.”
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Authorized by Victoria Residential Builders Association; registered sponsor under the Election Act, 250-383-5044.
After this column was completed, CMHC released its market evaluation for Victoria here. They note that in the 3rd quarter of 2016, completed and unsold units numbered just 57 while the 5 year average is 415 units. Our supply is just 14% of the average, which is causing high prices. Instead of addressing the source of the problem – govt over-regulation and poor regional planning – Victoria Council has focused on foreign buyers.