October 2015
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Connections (October 2015)
Connections: Advocacy News from the British Columbia Real Estate Association – October 2015 
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  Still Seeking Fairness for Real Estate Buyers

This month, BCREA will make recommendations to improve housing affordability and tax fairness for BC homebuyers, as part of the annual consultation on the provincial budget.

BC's Liberal government has made tax competitiveness a cornerstone of its fiscal policy, except for the Property Transfer Tax (PTT). Ever since the PTT was introduced in 1987, it has been applied in the following way: 1% on the first $200,000 of the fair market value of a property, and 2% on the remainder. This static structure is entirely at odds with BC's dynamic real estate market, and places an increasingly unfair burden on homebuyers.

If the PTT is to remain, due to its contribution to provincial revenue, then it's time to restructure the tax to reflect market conditions and assist BC families, many of whom face the highest home ownership costs in the country. For this reason, BCREA will once more ask the provincial Select Standing Committee on Finance and Government Services to forward the following recommendations to the Minister of Finance for inclusion in the 2016/2017 provincial budget:

  1. Increase the 1% PTT threshold from $200,000 to $525,000, with 2% applying to the remainder of the fair market value.
  2. Index the 1% PTT threshold of $525,000 using the MLS® Home Price Index, and make adjustments annually.

BCREA believes a fair system of taxation and a thriving economy will help citizens throughout BC enjoy an enviable quality of life, and better position BC to attract businesses.

While BCREA has taken countless opportunities in the past 28 years to lobby for either elimination or mitigation of the PTT, the context of this year's consultation is somewhat unique. In recent weeks, BC Minister of Finance the Honourable Mike de Jong has speculated in the media about increasing the 1% threshold and possibly changing the structure of the tax. BCREA, 11 real estate boards and nearly 20,000 REALTORS® around the province are always interested in working with the provincial government on this issue.

The provincial budget consultation is undertaken every year by the Select Standing Committee on Finance and Government Services of the Legislative Assembly of BC. The all-party committee holds hearings and accepts submissions for about a month, and then releases a report by mid-November. To learn how to participate in the budget consultation process, visit https://https://www.leg.bc.ca/.

For more information about BCREA's position on the PTT, visit BCREA's website at www.bcrea.bc.ca/government-relations/shelter-taxes.

 Local Government Perspectives on Drug Operations

Local government elected officials and staff, and representatives from First Nations, had some interesting discussions about the regulation of marijuana grow operations during the 2015 Union of BC Municipalities (UBCM) Convention in late September.

But regulation of the sale of currently-illegal drugs doesn't address the likely tens of thousands of homes and buildings that have been used to produce drugs. The varied approaches taken by local governments regarding disclosure and remediation make it difficult for buyers and renters to know whether a home is safe to occupy.

During the UBCM Convention, BCREA conducted an informal survey of delegates to gauge concern about this issue. In fact, the survey was first conducted with the same audience in 2011, and concern remains high.

  2011 survey 2015 survey
Respondents 98 respondents from 71 communities 73 respondents from 61 communities
How significant a problem are drug operations in your community? 56% said they are at least a somewhat significant problem 56%
From your personal perspective, when considering a home to live in (either to buy or rent) how important is it to you to know whether the property was used in a drug operation? 93% said this was at least somewhat important (89% very important) 92% (89% very important)
Do you believe the province of BC should have a centralized, consistent process for disclosing property history information in BC? 88% said yes 93% said yes
Do you believe the province of BC should have a centralized, consistent process for remediating buildings used in drug operations? 83% said yes 68% said yes

BCREA is encouraged by all of these results—particularly by the increased awareness among local governments of the need for consistency in remediation—and will continue to put forward the following recommendations:

  • Develop a centralized, consistent process for disclosure of property history information.
  • Describe a healthy building and then develop a centralized, consistent process for remediation of buildings used in drug operations.
  • Define a "drug operation" in a meaningful way.

For more information about BCREA's position, including a short video, visit www.bcrea.bc.ca/government-relations/drug-operations.
 Current State of Floodplain Maps

Later in October, BCREA will release an inventory of floodplain maps that have been created since the BC Floodplain Mapping Program ended in 2004.

Floodplain maps can support local government decision making by demonstrating the risks to both existing and proposed developments and infrastructure and, in the process, help foster resilient community growth and emergency planning. To be effective, however, floodplain maps must be updated regularly to account for many factors, including changes in development, the environment and climate.

The report also describes how floodplain maps are used, the public availability of maps, availability of supporting data, and challenges and opportunities that communities have experienced in attempting to prepare/update floodplain maps. Data were obtained through a survey of and interviews with local governments and First Nations bands in BC. This report helps to identify gaps in floodplain mapping and highlights the need for up-to-date floodplain information in BC.

One positive development on this file from the provincial government is the creation of the Ministry of State for Emergency Preparedness, within the Ministry of Transportation and Infrastructure, led by the Honourable Naomi Yamamoto. This move demonstrates that the province takes this matter seriously, and makes BC the first jurisdiction in North America to devote a cabinet position to emergency preparedness.

More information about BCREA's floodplain maps initiative is available at www.bcrea.bc.ca/government-relations/flood-protection. If you're interested in receiving the BC Floodplain Map Inventory Report, please contact [email protected].

 Contact BCREA

Contact BCREA at [email protected] with your comments about these issues, or to provide an update on your organization’s successes.

For more information about BCREA’s public policy positions, visit www.bcrea.bc.ca/government-relations.

BCREA is the professional association for more than 18,500 REALTORS® in BC, focusing on provincial issues that impact real estate. Working with the province's 11 real estate boards, BCREA provides continuing professional education, advocacy, economic research and standard forms to help REALTORS® provide value for their clients.

To demonstrate the profession's commitment to improving Quality of Life in BC communities, BCREA supports policies that encourage economic vitality, provide housing opportunities, respect the environment and build communities with good schools and safe neighbourhoods.

To subscribe to receive BCREA publications such as this one, or to update your email address or current subscriptions, click here.

British Columbia Real Estate Association
1420 – 701 Georgia Street West
PO Box 10123, Pacific Centre
Vancouver, BC V7Y 1C6
Phone: 604.683.7702
Fax: 604.683.8601
[email protected]
Click here to visit the BCREA Connections archive, available on BCREA Online.
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Real estate boards, real estate associations and REALTORS® may reprint this content, provided that credit is given to BCREA by including the following statement: "Copyright British Columbia Real Estate Association. Reprinted with permission."
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