Latest news appears first.
Year 2024 Final Update:
This is a final update to the Unjust Property Tax Coalition participant base.
Although the advisory committee has not officially disbanded, 3/5’s of us have either sold our apartment or intend to do so shortly. The Coalition was started in the fall of 2016 as a forum and advocacy / lobbying group against the broad application of city of Vancouver’s Vacancy Tax (EHT). We lobbied council, made presentations, and eventually contracted formal legal opinions against its unfairness on the basis of both a) municipal taxation laws, and b) personal property rights as relevant in constitutional law. However, we deferred on an actual legal filing, based on other relevant BC Supreme Court actions and rulings, one of which is still outstanding. We also recognized the enormous cost and time a case as this would entail, given a shifting plaintiff base with differing unique complaints. A good overview of housing , property rights, municipal law, governance and property law can be found in the attached presentation on Sept 14/24 by Prof. Alexandra Flynn of the UBC Allard School of Law. Although it has a focus on BC’s Sunshine Coast, it provides much fertile background to BC and Canada in general, and how we stack up against other developed nations.
So, in conclusion, entering ten years, we have given it our best shot. We are all better informed, but no further collective action is contemplated.
New developments:
1 Initiating vacancy taxes by cities both nationally and globally has not lost momentum. The housing shortage crisis remains acute in many, both for rental and ownership affordability. According to StatsCan, Canada’ s population surpassed 40 million citizens in 2023, with BC registering a 20.9% increase over the past ten years. During that time the benchmark house price in BC increased by 85.9%. Even with recent city zoning relaxations and provincial housing initiative dictates, new housing starts will not achieve housing affordability( https://cityhallwatch.wordpress.com/2024/09/15/bc-bills-44-46-47-18-no-affordability-should-be-rescinded-murphy/ ). Hence, although for the majority of coalition participants we constitute a small fraction of owners with legitimate use of secondary homes in Vancouver, it remains politically expedient to not allow any exemption of the Vacancy Tax, for purposes as ours. As written in the minutes of the Nov 13/24 Standing committee on City Finance and Services : ”It is incumbent on Vancouver City Council to ensure that a range of housing options are available for people in our city at all income levels and to ensure the City is ready and prepared to seize upon attainable home ownership opportunities as they emerge, especially when new programs led by senior levels of government in partnership with private sector innovators are becoming available.”
2. The city of Vancouver updated it’s Seniors Housing Strategy Report, dated Sept 10/24, recommending “amendments to the Zoning and Development By-law and various other by-laws and land use documents to improve clarity of seniors housing and care uses”. This confirms that amendments relating to seniors housing are possible. Part of this strategy is to fast-tract initiatives in social and cooperative housing starts, particularly for seniors on income assistance. ( https://vancouver.ca/news-calendar/City-seeks-to-fast-track-social-and-co-operative-housing-sep-2024.aspx ). Given such focus on a dire-needs population base, one can appreciate why an issue of intergenerational support and family resilience, that highlights the need of many middle class coalition participants owning a secondary residence in Vancouver, does not find traction amongst select city councillors who might have been most sympathetic to our cause.
3. In November, the coalition advisory committee was waiting for city administration to release it’s annual report on the performance of the Vacancy tax in the past year, to review it, and attend it’s presentation by city administration to council. The report was released, ( https://vancouver.ca/files/cov/2024-empty-homes-tax-annual-report.pdf) but not presented to council at a formal meeting. It only covers the fiscal year 2023. Highlights show a diminishing downward trend in homes declared vacant, and an insignificant increase in tenanted properties (1,304) relative to demand, that cannot solely be attributed to the EHT. There was static but overall declining revenue of $32 million range that is subsequently targeted for supportive housing initiatives. Whether the revenues generated are declining becomes immaterial, as the primary focus is expanding affordable housing, by shrinking any housing base not used full-time. Of the 1,156 vacant properties in 2022, 49% were occupied in 2023 (26% as principal residences, 23% tenanted). A mere 83 less units were declared vacant in 2023 relative to the year previous.
4. The provincial government has now launched a new BC Home Flipping Tax, to further tighten the speculator noose, if a property is sold in less than 2 years of ownership. This also affects the attraction of investors to buy pre-sales and flip ownership prior to completion of a development project. https://www2.gov.bc.ca/gov/content/taxes/income-taxes/bc-home-flipping-tax . However foreign ownership of residential and commercial purchases in select global cities remains strong. According to Provincial property transfer tax data, transactions in 2024 totalled $824 million with the total number of foreign transactions, including commercial, increasing from 1,018 to 1,020 over the past year. (foreign-money -continues-to-flow-into-bc-real-estate/https://www.theglobeandmail.com/real-estate/vancouver/article- )
5. New provincial Legislation restricting short term rentals is another initiative aimed at easing the housing crises, that may have some beneficial effect , if minor, affecting an estimated 1,500 homes only. ( https://vancouversun.com/news/1500-illegal-short-term-rental-listings-targeted-by-province-as-registry-gets-set-to-launch?utm_source=substack&utm_medium=email )
This concludes recent news and developments relevant to participants in the Unjust Property Tax Coalition.
The website will continue for this year, as there is valuable material for reference for those owners recently similarly affected. Any new initiative would have to be from a newly formed group within the Coalition .
Year 2023
October 31: Vancouver council met and reviewed the recommendation of city staff following summer consultations and analysis, to maintain the Vacancy Tax Rate at 3%. The coalition sent a submission to each councillor and presented our response at the meeting. We requested an exemption for seniors with local family, and or with professional or volunteer ties with the city. An exemption for medical reasons had already been passed in spring. We requested that council task city administration to consider the implication of exempting seniors who own secondary homes for the reasons outlined, and adding a “social resiliency surtax” to the broad city tax base, given that revenues are falling from the EHT, which the city has come to rely upon for affordable housing initiatives. No action was taken by Council on these recommendations.
The province of BC introduced strict new short term rental rules of interest to any owner of a secondary home renting part-time. The Orca Article
Federally, CRA has allowed an extension to filing the federal under-utilized homes tax until April 30th. This tax applies to foreign nationals. See here.
July 28: Lawson Lundell LLP files a new legal challenge to the EHT with the BC Supreme Court, an application for Judicial Review. Details can be found here ( attachment)
May10: City staff reviewed the EHT with council, with recommendations on fairness and taxation rate. We circulated a document to mayor and council prior, (attached) articulating our position, and met with one councillor… Lenny Zhou, prior to May 10th. Council meeting was personally attended by two advisory committee members with presentations, and one write-in presentation. We lobbied on a potentially “winnable” issue: seniors and intergenerational family supports. The city allocates significant resources for seniors issues, but the issue of seniors owning secondary homes remains, at present, too hot a political potato, even though we are part of the solution, not part of the the problem.
Council votes:
EHT tax rate: City staff recommended a reversal of the rate increase this year of 5%, and maintaining it at 3%. There were eight other suggested amendments, dealing with fairness, many having to do with permitting delays, uninhabitable properties etc. Report is here. Notably:
-
- a graduated tax penalty, less for first-time owners liable to taxation, more for repeat owners.
- an extension of late filing timeline and penalties
- ending the strata rental exemption in 2024, in alignment with the provincial initiative
- an exemption for medical treatments subject to a physician’s medical certificate
January 28: Key Ontario cities get on the bandwagon with their own 1% Empty Homes Tax using Vancouver’s EHT as a template. ( Toronto, Ottawa, 2023, Hamilton in 2024, Peel district considering for 2024). Once an Ontario group organizes itself, the Vancouver group is happy to coordinate/ divulge further information.
January 12: Coalition Advisory Committee meets with city staff. Summary for discussion attached here.
Year 2022
October 15: Vancouver municipal electors give a resounding defeat to Mayor Kennedy Stewart, bringing in a majority council for mayoral-elect Ken Sim of the newly formed ABC (A Better City) party. This presents our coalition with an opportunity to lobby for realistic changes to the Vacant Homes Tax, to a council that is wiling to take a fresh look at the whole cause of housing unaffordability in Vancouver.
April 27: Vancouver mayor Kennedy Stewart and council pass a motion to increase the Vacant Homes tax to 5% effective 2023 with the amendment for city administration to : “look into how the Empty Homes Tax exemptions might be altered to improve fairness so that those with legitimate reasons for vacancy, and/or having a second property, are not penalized.”..https://dailyhive.com/vancouver/vancouver-mayor-kennedy-stewart-empty-homes-tax-hike-2022-proposal. Coalition Advisory Committee prepares a proposal for fairness amendments.
Year 2021
December: BC Supreme Court rules in favour of law suit against City of Vancouver EHT audit committee in regards to tax imposed on property under development. A small victory in regards to “fair process”. Summary here.
Oct – December: Numerous articles in various news publications in support of EHT, if not for shifting rental availability, then as a “wealth tax” that supports housing affordability initiatives. Other cities ( Toronto, Hamilton, Victoria, Windsor, Kitchener) actively proceeding with EHTs similar to Vancouver’s. CMHC supported study promotes 1% federal wealth tax on properties over $1 million. Van Sun Link here.
September: Liberal party election platform flouts the idea of a 1% property tax on secondary homes Coalition sends formal response to CRA. Letter writing campaign to Prime Minister, Minister of Finance, and local MLAs against such an initiative
April : The appeal to remove redactions from the released city EHT audit manual was forwarded to the BC Freedom of Information adjudicator, who ultimately ruled in the city’s favour.
February: Attended over the year a number of City Planing initiatives dealing with Urban redesign and housing unaffordability. Letter sent to Gil Kelly General Manager, mayor and city councillors of the need for EHT relaxation , recognizing that Vancouver’s seniors need time and more options that more nursing homes (as highlighted by the pandemic). That there is a new understanding of intergenerational support and family living proximity,… that this takes time and a secondary home used by family is often a time bridge as this new paradigm evolves.
Year 2020
November: The BC Ombudsperson’s decision not to take up the case of “fairness” of the EHT was unsuccessfully appealed by the Unjust Tax Coalition. November 25, the mayor convinced city council to approve an increase of the EHT from 1.5 to to 3% of assessed value ( Van Sun article), based on the supposition that the EHT was causal in increased rental vacancy. However evidence cited from the preliminary CMHC report of rental vacancies in 2019, does not support such a direct link to the EHT as being causal, though likely contributory.
June: The Coalition advisory committee is seeking under BC Freedom of information legislation release the full version of the City Tax Compliance Manual, the basis of which results in random audits. This request, including a number of appeals, dates back to 2 years. Further, we have submitted a formal complaint to the Office of the BC Ombudsman, regarding the fairness of the city Vacancy Tax bylaw as currently written.
April: Separate class action against Speculation Tax requesting injunction on its application citing Charter Rights quashed by BC Supreme Court.
Year 2019
December: The legal pleading for filing a class action is completed by the Unjust Property Tax Coalition’s lawyer. We negotiated with a number of suitable legal firms to take on the file. The city of Vancouver released it’s annual report on the EHT https://vancouver.ca/files/cov/vancouver-2019-empty-homes-tax-annual-report.pdf. Our presented Rebuttal to CoV EHT Annual Report 2019 at council meeting is attached . Against the advice of it’s own administration, council has elected to increase the EHT by 25% yearly for the next 3 years. ((https://vancouversun.com/news/local-news/vancouver-hikes-empty-homes-tax-by-25-per-cent ) . Legal fund recruitment continues.
December 24: BC Supreme court rules in favour of Belmont property against city to review imposition of EHT due to city’s delay in development permitting.
April: Letter of response sent to city staff cc Mayor and city councillors, with positive suggestions for Vacancy Tax bylaw changes and further research into their database of who actually had the tax imposed. Legal fund recruitment continues.
March: Members of the Coalition Advisory Committee met with Melanie Kerr Director Financial Services Vancouver City Staff, who is responsible for the administration of the Vacancy Tax bylaw. Our purpose was to explore how we may positively influence the March council directive “to explore an additional bylaw exemption to cover situations where property owners may be unintentionally impacted by the tax”. The meeting was positive, but inconclusive.
March 2. Don Sorochan QC is engaged as legal counsel, who will fully research and articulate a legal challenge on the basis of constitutional arguments for both the Provincial Speculation Tax and the city of Vancouver’s Vacant Homes tax. Learn more about Mr. Sorochan here.
March 1. Michael Geller’s Blog on his presentation to Vancouver City Council. http://gellersworldtravel.blogspot.com/2019/03/presentation-to-vancouver-city-council.html
February:
Feb. 28. G&M commenting on Vancouver Council recent meeting. https://www.theglobeandmail.com/canada/british-columbia/article-vancouver-councillors-support-empty-homes-tax-despite-dubious-results/
Feb. 27. Rainer Borkenhagen gave a strong presentation supporting our position at Vancouver City Council. The council is currently looking at amendments to the EHT. Planner Michael Geller also spoke and supported our position. Click here to view. (Choose Feb. 27, PS&P-entire clip to view. Rainer appears at about 5.03.45)
Feb. 27. Article appearing in the Georgia Straight https://www.straight.com/news/1206636/sfu-prof-andrey-pavlov-says-ndp-housing-taxes-miss-mark-declaring-new-supply-only-long
Feb. 20. Article by Vancouver Lawyer Noah Sarna on how to improve the EHT. https://www.thor.ca/blog/2019/02/how-to-improve-the-fairness-of-vancouvers-empty-homes-tax/