High home costs are increasingly pricing people out of the real estate market and raising questions about Metro Vancouver’s long-term affordability and sustainability.
The market’s rise has been partly driven by an influx of foreign investment, including a steady parade of buyers from China.
Meanwhile, the struggle continues to find new funding for TransLink for much-needed transit expansion without inflicting too much pain on already heavily taxed residents and motorists.
Gas taxes, vehicle levies and tolls are all hugely unpopular, raising the spectre that political paralysis may freeze any improvements, including the Evergreen Line.
So here’s one provocative proposal that might help put a dent in both problems: Double TransLink’s current residential property tax rates.
But at the same time, create a homeowner grant that rebates 50 per cent of the TransLink tax.
Like the homeowner grant on municipal property tax, the TransLink version would exclude second vacation homes and disqualify owners who aren’t Canadian citizens or landed immigrants.
There’ would be no change in the $230 a year in property tax the average resident homeowner now pays TransLink for a typical $650,000 house in Metro Vancouver.
Most working folks would notice no difference.
But the transportation authority would suck twice as much cash from foreign buyers, other non-resident owners and speculators.
A $4-million luxury condo owned by a Hollywood starlet, Shanghai business magnate or Alberta oil tycoon – who jets in once or twice a year – might bring $2,800 to TransLink each year instead of the current $1,400.
And why shouldn’t they pay more?
They come to enjoy Vancouver’s legendary livability yet make no permanent commitment to the region and use scarce housing inefficiently.
For that privilege of using our city like a fly-in resort, they can cough up some extra coin to help build new rapid transit lines across the region and contribute to the long-term viability of the region and their investment.
Others who would pay more are qualifying residents with homes worth more than whatever cap is set for the benefit. (The civic grant is phased out for homes worth more than $1.3 million).
TransLink currently collects nearly $300 million a year in property tax. Not all of that is residential and only a small fraction comes from non-qualifying homeowners.
But doubling what they pay might still generate an extra $20 or $30 million a year – a significant chunk towards TransLink’s $70-million-a-year upgrade plan, perhaps avoiding the use of one of the less palatable revenue sources.
And if a selective TransLink tax hike on non-residents or other owners of ritzy homes takes a bit of the juice out of our overheated real estate market, so much the better.
– Black Press