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

ISSN 0709-1281 (Print)

ISSN 1499-2175 (Online)

CONTENTS

Page

Orders of the Day

Second Reading of Bills

Bill 28 — Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act, 2016 (continued)

D. Eby

Hon. P. Fassbender

C. James

Hon. T. Wat

L. Krog

J. Thornthwaite

K. Conroy

Hon. A. Wilkinson

N. Macdonald

J. Yap

S. Robinson

D. Bing

G. Heyman

R. Sultan

V. Huntington

[ Page 13387 ]

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]

[ Page 13393 ]

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

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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.

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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.

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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

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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.

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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.

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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

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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

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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

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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