Red hot real estate market fuels provincial coffers to the tune of hundreds of millions of dollars
The surge in real estate prices continues to provide the province with an unexpected windfall
Property tax transfer revenues were up 44 % for fiscal 2015, and that’s a budget surplus of a whopping $730 million, $446 million more than was forecast in Februrary’s budget.
This is the housing boom on Vancouver Island, with the demand for homes in Victoria and Vancouver is at its highest in forty years.
B.C.’s red hot real market is a cash windfall for the provincial government.
Finance Minister Mike de Jong says the revenue from the property transfer tax is much more than expected.
“It’s clear that property transfer tax revenues are up.
It’s clear from the report I’ve just given you that I have indicated that trend is continuing beyond the levels we thought prudent to plan for.”
In its 2015/2016 budget the province anticipated collecting 928 million dollars in property transfer taxes.
But it collected more than 1.5 billion, and additional 605 million dollars.
A 44 percent increase.
But NDP leader John Horgan says this is proof the housing market is overheated.
“This is a budget built on the backs of a real estate bubble and it’s not sustainable.
Little wonder that Christy Clark does not want to address the root cause of the housing affordability crisis in the Lower Mainland.
And that speculative investments that are not being taxes appropriately.”
The government is calling the legislature back on Monday.
It’s going to table legislation that will allow the City of Vancouver to tax vacant houses.
But de Jong says the solution to high prices is simple.
“Build more houses.
People want to buy them.
Canadians want to buy them.
British Columbians want to buy them.
So let’s give them something to buy.”
But the NDP maintain the government is not addressing the root problem.
“We need to make sure that everyone who is here now is able to live in the communities that they want to live in.
And if you can’t find rental accommodation, if you have zero chance of getting into the housing market because of distorted prices as a result of speculators trying to make a quick buck, that has to be addressed.
And the government doesn’t want to do that.”
According to the Ministry of Finance, the total value of British Columbia’s real estate market sold this year and last is more than 93 billion dollars.
And there is no indication the market is cooling off anytime soon.