Article content continued

Now a group of academics from the area, most of them affiliated with the Sauder School of Business at University of British Columbia, has proposed a solution: a tax on properties left vacant, or held by those with “limited economic or social ties to Canada” — i.e., who pay little or no taxes here — with the proceeds to be distributed in equal lump sum payments to every local tax filer.

The tax would be a hefty one: at 1.5 per cent of property value, it would roughly quadruple the property tax paid by the small number of homeowners to whom it would apply. Not only would this make B.C. “a less attractive target for investors who wish to avoid taxation or park cash in residential real estate,” but the professors calculate it would raise at least $90 million annually for their proposed B. C. Housing Affordability Fund.

But to what end? It is not clear, for starters, that the professors’ solution has a problem. While high and rising home prices are obviously to the disadvantage of potential buyers, they are equally to the benefit of existing owners. If there is a social interest in taking from the latter, as a group, to give to the former, as a group, it is not evident. Or if there is, let us remember it when prices drop, and the papers are filled with stories about elderly folks of modest means who had been counting on using their home as a pension.

There is in fact very little evidence to support the notion that offshore money is responsible for inflating Vancouver real estate prices — as opposed to three per cent mortgage rates, a relatively strong local economy, and so on. The vacancy rate for most types of housing in the city is roughly two per cent, rising to 7.5 per cent for condos, but only a fraction of those are owned by non-residents. Maybe the fabled Chinese billionaires are driving up prices for a few super-homes at the very top end, but it’s a stretch to blame them for the state of the market generally.