ICBA: Eby's condo tax punishes the people who build homes

On Friday, BC NDP leader David Eby promised two new tax hikes on housing. The Independent Contractors and Businesses Association (ICBA) – Canada’s largest construction association – warns they will mean fewer homes built in B.C., not more.

The NDP plan would:

• Raise the speculation and vacancy tax by one percentage point: from 1% to 2% for domestic owners, and from 4% to 5% for foreign owners.
• Create a new Unsold Condo Tax on finished condos that stay unsold for more than a year. It starts at 2% in year two and rises one point for each year after.
• Target about 5,000 unsold condos that the NDP values at $4.45 billion.

Statement from Jordan Bateman, ICBA Vice-President of Communications and Advocacy:

“David Eby says B.C. home prices are falling faster than anywhere else in Canada. Two sentences later, he says developers are sitting on empty condos, waiting for prices to go up.

A month ago, he was still clinging to his flawed condo bailout scheme, which no builder ever asked him for. Today, he’s declared those same builders the enemy because they can't afford to sell at a massive loss.

This is the NDP record on housing: a contradictory, convoluted, confusing mess. And home buyers and builders are the ones paying for it.

Nobody is holding a finished condo in a falling market for fun. Every month it sits empty, the builder pays interest, strata fees, property tax and insurance. Those units are empty because the buyers disappeared.

An unsold condo tax will make things worse. Lenders will read it as a penalty for building homes that don't sell fast enough. They’ll want more presales and charge more for the risk. Projects that don't make money today are already shelved. This tax will shelve more, and the next housing shortage gets deeper.

Speculation tax. Flipping tax. Now a condo tax. The NDP has a tax for everything, and not one of them has made a single home more affordable.

ICBA has been clear for years: you can’t tax your way to more housing – if you could, we’d have the cheapest housing in Canada.

If Eby wants those condos sold, he should cut the fees and red tape stacked on every new unit and build a robust, prosperous economy that helps buyers get into the market.

If Eby wants more homes, he should stop punishing the people who build them.”