Christy Clark’s house of cards could fall as housing prices, foreign ownership rise in Vancouver, Victoria
New highrise housing in the Yaletown area of Vancouver are pictured in this file photo. (File photo)
“And after six months when a foreign-ownership tax fails, it will only cause racially charged conversations to go beyond where they are now.”
- Real-estate mogul and B.C. Liberal major donor Bob Rennie, June 2016
Premier Christy Clark built a house of cards that could collapse when British Columbians vote in just seven weeks – because both housing prices and foreign ownership are back on the rise in Metro Vancouver – which has the English-speaking world’s third worst housing affordability.
It’s happening just as the B.C. Liberal government last week exempted foreign nationals with work permits and up to 170,000 foreign students from the Metro Vancouver 15% foreign buyers tax, letting them apply for refunds if they recently bought homes.
And in Victoria – where there is no foreign buyer tax – Canada Mortgage and Housing Corporation issued a “red warning” alert due to rapid price hikes and overvaluation of housing.
In Metro Vancouver, the condominium benchmark price jumped 2.3% over the past six months to $526,300. And Reuters reports Vancouver housing prices rose 0.3% in January, while Sotheby’s International Realty Canada says international buyers, predominantly Chinese nationals, are adjusting to the new foreign buyers tax.
That’s a huge challenge to B.C. Liberals, because polls say the most important election issue is affordable housing – and increasingly, the province doesn’t have any.
Housing, poverty and homelessness are the most pressing concern for 29% of B.C. voters compared to 18% for health care and 17% for jobs and the economy, according to a November 2016 Insights West poll. And 71% said Clark had done either a very bad or bad job on their top issue.
What’s more, the B.C. economy has become perversely dependent on property tax, with up to 40% of the province’s gross domestic product coming from the real estate sector in 2015 and 2016, while resource revenue is 7%.
Condo marketer Bob Rennie was only half right – the foreign buyers tax has failed – but without a racism outbreak.
The inconvenient truth for Christy Clark is that housing affordability is still well beyond the reach of buyers and renters alike in Metro Vancouver and getting rapidly worse everywhere in B.C. – and for many voters it will be the top issue in the May 9 election.
Bill Tieleman is a former NDP strategist. Read his blog at http://billtieleman.blogspot.com or Email: email@example.com Twitter: @BillTieleman