June 1, 2017
The Honourable Bill Morneau
Minister of Finance
90 Elgin Street
Ottawa, Ontario K1A 0G5
Dear Minister Morneau;
At a time when cities like Vancouver and Toronto are confronted with an unprecedented housing affordability crisis, I was encouraged to see the Federal government taking steps to work with the City of Toronto and the province of Ontario to address issues in their housing market. As Vancouver is facing many similar issues, I am writing to request a meeting with you to discuss a number of our concerns, focused on three issues:
- Affordability and the disconnect between local incomes and housing costs;
- Efforts to combat tax evasion in the housing market;
- Local and global speculation in Vancouver real estate.
It is vitally important that the public has confidence in our regulatory institutions and their ability to ensure a level playing field in our real estate market. While your recent actions to provide greater oversight on issues of capital gains are greatly valued, I often hear from residents who are concerned about fraudulent practices connected to home purchases in Vancouver. These concerns include whether proper disclosure of income and primary residence have taken place, and if the necessary taxes have been paid. Though many of the stories shared may be anecdotal, they speak to a growing anxiety that warrants a robust response to ensure the public has full confidence in our regulatory systems.
At the same time, housing prices overall are still vastly disconnected from local incomes in Vancouver, and our rental market is at crisis levels due to a near-zero vacancy rate. As a result, many businesses are struggling to recruit and retain talent, which is putting our economy, currently the strongest in Canada, at risk. The IMF recently issued a warning related to the risks present in the Vancouver and Toronto housing markets. If we are to ensure the future prosperity and inclusiveness of our city, a proactive approach that creates long-term stability and resiliency in the housing market is essential.
A coordinated policy response from all levels of government is needed to address these issues. Moreover, with Vancouver’s new empty homes tax currently being implemented, this is an opportune moment to collaborate on issues around monitoring capital gains and primary residence declarations.
I look forward to a productive conversation on how the City can support the Federal government’s efforts to grow the economy, ensure housing stability and affordability for the middle class, and increase public confidence in our regulatory institutions. I would also welcome the Finance Minister from the next provincial government to join our conversation as well, to ensure coordination across all three levels of government.
Mayor, City of Vancouver