Over the past few weeks, British Columbians who own property received their speculation and vacancy tax notices and were asked to provide information to make themselves exempt from the levy.
The speculation tax in specific urban areas targets foreign and domestic homeowners who pay little or no income tax in the province and those who own second properties that are not long-term rentals. It is one of five different policies the current provincial government implemented in an effort to give more British Columbians access to the real estate market. Housing began to climb as a concern for residents in 2014 and was a key issue for most urban voters before the 2017 provincial ballot.
When Research Co. asked British Columbians about the speculation tax last May, 62 per cent deemed it a “very good” or “good” idea.
Earlier this month, when Research Co. asked if they agree or disagree with the policy, the results were also satisfactory. More than two-thirds of British Columbians (68 per cent) say they agree with the speculation tax.
There is little fluctuation in the level of support for the speculation tax across all regions of the province.
When it comes to different age groups, British Columbians aged 18 to 34 who are aching to enter the housing market are more in favour: 73 per cent of them agree with the speculation tax. Majorities of those aged 35 to 54 (68 per cent) and those aged 55 and over (64 per cent) also support it.
More than four in five British Columbians who voted for the governing BC NDP almost two years ago (82 per cent) agree with the speculation tax, along with seven in 10 (70 per cent) of those who cast a ballot for BC Green Party candidates. Even BC Liberal voters from the last election are more likely to agree with the speculation tax right now (55 per cent) than to disagree with it (39 per cent).
The other four key housing policies are also endorsed by majorities of British Columbians. The decision to increase the foreign-buyer tax to 20 per cent from 15 per cent remains extremely popular, with four in five residents (80 per cent) agreeing with its implementation. The remaining measures were regarded as more controversial when they were announced. Across the province, 64 per cent of British Columbians agree with the government’s decision to increase the property transfer tax to 5 per cent from 3 per cent for homes valued at more than $3 million.
A similar proportion (66 per cent) is also in favour of the introduction of a tax of 0.2 per cent on the value of homes between $3 million and $4 million, and a tax rate of 0.4 per cent on the portion of a home’s value that exceeds $4 million.
When asked if they think the provincial government’s actions will be effective or ineffective in making housing more affordable in British Columbia, residents are not entirely convinced.
Fewer than two in five British Columbians (39 per cent) say they believe the provincial government’s intervention will be “very effective” or “moderately effective” in making housing more affordable. Almost half (47 per cent) expect these actions to be “moderately ineffective” or “very ineffective” in the long term.
This is where the key challenge for the government lies. The housing taxes, widely regarded as good ideas last year, continue to enjoy the backing of a majority of residents.
Still, measuring the effectiveness of these policies, even if the prospect of an early election has dissipated, will be complex. Housing will have to begin to disappear as a key concern for British Columbians, perhaps to be replaced by issues such as the environment or health care, which used to be top of mind among voters polled in the Gordon Campbell era before the 2008 financial crisis.
In any event, the province’s residents of all ages will need to establish an emotional connection to success. Maybe it will come in the form of a friend who was considering moving away but ultimately was able to stay, or a family member who gleefully signs his or her first mortgage. These are the milestones that can cause the currently muted numbers on “effectiveness” to surge.
Mario Canseco is president of Research Co.