On the streets of Oak Bay, ‘For Sale’ signs aren’t hard to find, and Mayor Nils Jensen says he’s worried about what will happen to prices as the province moves to discourage foreign investment through taxation legislation that only applies in the Lower Mainland.
“The problem is already here, it’s not acute like it is in vancouver but its going to become acute,” he said.
Jensen says foreign buyers are already making their presence felt in Oak Bay, and if they’re facing a 15-per-cent transfer tax and penalties for leaving homes sitting idle in Vancouver, he believes the problem is more likely to be moved than solved.
“It creates two tier municipalities, those with large populations in the lower mainland who have an acute problem and those with less population who have an emerging problem. There needs to be one solution for British Columbia, that’s the only way its going to work this isn’t sound public policy making.”
Victoria’s mayor Lisa Helps agrees the region is in an affordability crisis, and says local governments need more tools to contain it. But Helps says she’s prepared to wait and see if the measures to be trialed in the Lower Mainland are the right ones.
“We’ll see what happens there, and if its effective then it should be implemented for the South Island,” she said. “And if its so effective that it’s having a negative impact here, then i think we need to take a look at that really quickly.”
UBC Sauder School of Business economist Tom Davidoff studies the housing market. He says with disincentives being rolled out for foreign investors in Vancouver, Victoria is very likely going to catch their eye.
“You think about a provincial capital, you think about a good climate and Victoria meets those needs, so I think Victoria would be a natural.”
Jensen is calling for the province to work with both local and federal governments for co-ordinated action on housing affordability. Helps says in her discussions with provincial officials, she’s been promised they won’t sit idly by if the legislation coming to cool Vancouver’s market causes Victoria’s to boil over.