Group rallies realtors to battle foreign tax
The Fraser Valley Real Estate Board has issued a “call to action” to its 3,000 members, asking them to fight the new 15 per cent tax levied on foreign home buyers.
In an email on Aug. 16, board president Charles Wiebe said the two-week-old tax has hurt clients and the housing market.
The tax, introduced by the provincial government, is aimed at curbing skyrocketing real estate prices in Metro Vancouver.
But it has also created an “unfair ripple effect,” hurting local Canadians, Wiebe added in an interview.
“The government needs to look at it again, and change it,” he said. “There are still deals coming forward that may collapse because of this.”
The board is urging members to write to their MLAs and keep up the pressure. “It’s not uncommon for governments to amend legislation after the fact, but they’ll only do so with sufficient pressure and proof of impact,” said Wiebe in the email.
It is unclear how many real estate deals have collapsed as a result of the new levy. The email said the number of failed deals in the region has doubled since the tax kicked in on Aug. 2, compared to the same period in July, but Wiebe said he was unable to provide specific numbers as the board is still trying to determine which transactions fell apart directly because of the tax.
The numbers are small, “however, given what we’re hearing from brokers, we believe they will continue to grow and the full impact won’t be known for months,” he said. The Fraser Valley Real Estate Board covers several Metro Vancouver municipalities affected by the tax, including Surrey, White Rock, Langley and North Delta.
The Real Estate Board of Greater Vancouver, which embarked on its own letter-writing campaign by members in the first few days of
the tax, said any effect on pending deals was not immediately evident. The region records about 150 to 200 sales a day, with one to three of them collapsing. Those figures haven’t changed much, said the board. Both boards had called on the government to exempt deals signed before the deadline. Wiebe said government should also consider compensation for parties affected by the tax in those cases.
He acknowledged it is the government’s legal right to implement taxes, but believes the levy, which applies to all non-Canadians buying residential properties in Metro Vancouver, also unfairly targets people from abroad who are coming to live and work in, and contribute to, the region.
“I don’t believe they have to pay an extra 15 per cent tax just because they come from another country,” said Wiebe.
In the memo, the board said its efforts to reach out to the government through letters, phone calls and emails have been rebuffed.
“As we told them, we’re angry. As a profession, we were not consulted. Our requests to meet immediately after the tax came out were ignored,” it said. “We are genuinely concerned for the well-being of our clients and will not stop communicating with them until they address our concerns.”
The provincial government said the additional tax is aimed at cooling demand for residential properties while supply catches up. In an emailed statement, the Finance Ministry said the timing of the implementation of the tax — just four business days after it was announced — was the “fairest and most efficient” way to introduce it.
“When a tax policy decision is made, there may be those who feel that the timing of the change should be different,” it said. “By making the announcement through the tabling of legislation, we were able to make the information available to all taxpayers at the same time.”