Along with the change in premiers from J. Horgan to David Eby, an all-encompassing affordable housing plan has been outlined to create more housing for British Columbians and at the same time create opportunities for savvy real estate investors. Here is the breakdown;
• Fast-Tracking development:
For subdividing land into higher density parcels, developers have been handcuffed by municipalities dragging their feet on approvals. A recent client’s experience took 3 years to subdivide 2 lots into 3 lots. Despite possible objections made by local government, investors can now appeal directly to the province to have multi-family permits fast tracked. This will expedite the sale of the assembled lands to developers, over and above any objections the locals might have.
• Triplex Zoning for Everyone:
Each single family detached house will automatically be zoned to allow three dwellings within it. This is a boon to investors because they can now legally add two rental suites as mortgage helpers. This would certainly stem any price slide as buyers could now use the rental income to qualify for a higher mortgage. And any parking spot shortage would be solved when cars are outlawed 😉
• Tax Dollars To Buy Old Apartment Buildings:
With our provincial rental caps failing to keep up with the rising costs that landlords face to invest in maintenance, repairs, and renovations, selling these buildings is difficult as the numbers typically don’t work for a decent return on investment. But now the govt will be giving $500 million taxpayer dollars to back tenants’ groups, First Nations and non-profit organisations to purchase these aging properties.
• Flipper Tax:
Thanks to the current economic downturn, real estate flipping has all but disappeared in BC so this new policy is not too exciting. BUT what will be yet another government rule is a graduated tax (noooo ..not another tax!) on selling the property you just bought. After 2 years of ownership that ‘flipper tax’ will be zero but what is will be before that has not yet been ironed out. Hopefully the Feds will not implement their talked about home equity tax in the interim.
• No more rental restriction Bylaws:
The province is going to outlaw the right of a strata corporation to restrict rentals in order to increase rental supply. The idea is that investors will scoop up these units to rent them out at the high rental rates we are now experiencing and the current condo owners who don’t want to live in a ‘rental’ building will have to sell adding more units to the rental pool. But where will they go?