How Are Your $12 Billion Tax Dollars Being Spent?

The BC housing crisis is top of mind for anyone struggling to enter the housing market, find a rental, or hold onto their current home during these difficult economic times. Home prices, rental rates, and property taxes continue to rise, and with those skyrocketing costs comes housing insecurity. At D. Fritz Appraisals, we understand that finding an affordable home to call your own in desirable British Columbia has become a significant challenge.

A 2023 Leger poll found that 68% of British Columbians are concerned that they won’t be able to pay their mortgage or rent, and another 93% agree that increasing rental prices have become a serious problem.

While the BC housing crisis is hurting British Columbians, the provincial government is attempting to facilitate faster home construction and increase the number of rental properties through several initiatives.

Read on to learn how Stronger BC has made strides to deliver homes for people more effectively.

Stronger BC

As part of the BC housing action plan, the province has committed $12 billion (2023 budget) over the next 10 years to improve the housing market in BC.

A few of the steps the Homes For People Action Plan has taken include:

Fixing outdated zoning rules
Locating homes next to amenities such as transit
Fast-tracking approvals
Managing speculators
Maximizing rentals by reducing vacancy rates
Shifting short-term rentals to long-term rentals

1. Zoning Changes

Zoning changes are making a difference to the BC housing crisis. Here are just a few of those changes:

Adding a second, third, or fourth unit to your home is becoming easier. New rules and standardized designs are helping home builders speed up the construction of small-scale multi-unit housing.
A Secondary Suite Incentive Program (SSIP) allows qualifying homeowners to borrow up to $40,000 in the form of a forgivable loan to help with the cost of adding a rental suite to their home.
Changes to the Strata Property Act will allow children to live in many homes with previous age restrictions. Fifty-five plus stratas will remain unchanged. Condo owners belonging to stratas can now rent out their vacant units as long-term rentals.

By removing zoning barriers and building more small-scale multi-unit housing, people who have been priced out of the competitive market will have a more affordable entry point.

2. Affordable New Construction

Efforts are being made to make housing in BC affordable for everyone. The provincial government has a few strategies in place to tackle escalating house prices.

Programs such as BC Builds have partnered with local governments, First Nations, and non-profit organizations to develop housing for middle-income households. BC Builds leverages public, community, and non-profit-owned land to speed up development and lower construction costs.
Changes to rules and regulations will allow more homes to be built near rapid transit stations like the SkyTrain
Over 12,000 beds will be added to schools across BC for students living away from home
Municipalities will have housing targets to meet to keep up with projected growth

Along with these improvements, steps are being taken to assist BC’s most vulnerable, including rent banks for people in temporary financial crises, supportive housing for those experiencing homelessness, and more complex care housing.

Want to take a deeper dive into middle-income housing? Check out our previous blog, Is Missing Middle Housing The Answer to Victoria’s Housing Shortage?

3. Fast Tracking Approvals

A Building Permit Hub has been created to automate parts of the application process. Applications will be checked to ensure they meet the BC Building Code and Energy Step Code, minimizing delays. With online permitting, permit review and approval will be easier and faster.

In addition to the Building Permit Hub, an application portal for natural resource permits has been created. The BC Housing Taskforce will work across ministries to guide the natural resource permitting process.

The single housing application service includes permits issued by:

Ministry of Environment and Climate Change Strategy
Ministry of Forests
Ministry of Transportation and Infrastructure
Ministry of Water, Land and Resource Stewardship

Along with over forty new staff, a Housing Navigator Service is in place to assist with questions and provide guidance.

4. Minimizing Speculators

The Speculation and Vacancy Tax (SVT) aims to turn unoccupied rentals into long-term rentals in communities with the most significant housing shortages. Residential property owners will be required to declare for the first time starting in 2025. The province has provided this interactive map to help you determine if your community is in the taxable area.

In addition to the SVT, the BC Home Flipping Tax, effective January 1, 2025, is expected to discourage investors. This tax applies to homeowners who sell a residential property less than two years after purchasing. Proceeds from the Home Flipping Tax will be used to build affordable housing.

Besides the above taxes, the Foreign Buyers Tax has been increased to 20% and expanded to include more communities.

All these changes combined hope to deter and penalize speculators.

5. Protecting Renters

Houses to rent in British Columbia are becoming fewer and further between. The province has recognized that the low vacancy rate for rentals has caused rents to soar. To help mitigate the increased costs, renters with an adjusted income of $60,000 or less can claim a renter’s tax credit of up to $400/year.

More help for renters is coming. The Short-Term Rental Accommodations Act provides governments with stronger enforcement rules to restrict short-term rentals to principal residences, increasing long-term rental availability.

To further protect renters, rental rates have been capped at 3.5%, below the inflation rate, to improve affordability.

For Expert, Detailed, and Trustworthy Valuations, Trust D. Fritz Appraisals

The current BC housing crisis may be just the impetus you need to add a secondary suite or a small-scale multi-unit to your property. Perhaps you’re interested in taking advantage of the Secondary Suite Incentive Program. Look no further than D. Fritz Appraisals Inc.

Let us appraise your new construction or renovation to ensure your lender financing is approved. Our certified real estate appraisers provide accurate property value appraisals for homes at all stages of construction.

Serving Victoria to Nanaimo and the Gulf Islands, our expert team is approved by most banks, credit unions and private lenders. Contact D. Fritz Appraisals Inc. today, and we can tailor an appraisal report to meet your lending, selling, and appraising needs.