Real Estate, Citizenship & Residency Data Collection, Analysis and Reporting
There is a growing level of concern that the British Columbia housing market, particularly in urban regions, has become over inflated. Many domestic and international organizations claim that B.C. is experiencing a housing bubble. Local citizens worry that soaring prices have pushed the dream of home ownership forever out of reach. Several partial studies have attempted to determine the impact of foreign buyers on various segments of the B.C. housing market, however a full province-wide study has yet to be completed. In the absence of factual, reliable data, the public is left to speculate and governments are unable to implement evidence-based solutions.
As part of the B.C. Budget 2016, the provincial government announced that “Individuals who purchase property will need to disclose whether or not they are Canadian citizens or permanent residents of Canada. Individuals who are not Canadian citizens or permanent residents of Canada will need to disclose their home country or state. If a property is registered in the name of a corporation, the transferee must disclose the total number of directors, the number of those who are Canadian citizens or permanent residents of Canada, and the name, address and citizenship of all foreign directors.” Although the 2016 B.C. Budget announcement is a step in the right direction, it will take many years before enough information is collected to be useful. Therefore, it is important to expand this measure to track and analyze the citizenship and residency of property owners of existing properties within British Columbia. Furthermore, the Province has not made it clear how any of the collected data will be used or if it will be made available to the public. Canada is one of the few industrialized countries who fails to track foreign property ownership. One only need to look to our neighbours in the United States to find examples of how foreign property ownership is tracked, analyzed and recorded. Through organizations such as the National Association of Realtors (NAR), the United States records and reports data on foreign property ownership through a public annual report which focuses on the purchase of U.S. homes by people whose primary residence is outside the U.S.
An over-inflated housing market can cause many forms of speculation as the population attempts to determine the causes. This leads to fears relating to the real estate industry, including suspicions of improper or dishonest dealings by those in the real estate profession. It also causes fears of potential risks to the economy, such as labour shortages and stifled business innovation as skilled workers prefer to locate to other regions where they can afford homes. Various regions also fear the loss of potential new businesses and the accompanying jobs they create if they are unable to find workers. A very clear example has been playing out in Whistler as this jurisdiction has struggled with a severe labour shortage resulting from a lack of affordable housing. This issue can lead to a negative impact on growth and financial contributions to public services. It is imperative that we begin to understand the full scope and impact foreign non-resident real estate investment can/is having on B.C., as speculation is leading to unfair stereotyping of various ethnic group.
For 20 years, it was standard practice to file citizenship declaration forms along with every property transfer registered in the BC Land Title Office. These statements indicated the citizenship of individuals and directors of corporations purchasing land in B.C. They were collected and stored without any analysis during the tenures of previous provincial governments. No financial resources were ever allocated to inventory and catalogue these statements which resulted in the cancellation of the program in or about 1998. Subsequently all data was destroyed.
In accordance with the Property Transfer Tax Act, the Ministry of Finance currently collects a variety of personal data through a Property Transfer Tax Return (Version 26) which is filed electronically for every property transfer filed in the BC Land Title Office. Through the tax returns, the Ministry of Finance calculates and facilitates the collection or exemption of property transfer tax. Exemptions or partial exemptions are identified through a variety of clearly defined exemption codes. The Ministry of Finance is also responsible for auditing property transfer tax returns and investigating fraudulent exemption claims.
THE CHAMBER RECOMMENDS:
That the Provincial Government:
Ensure that citizenship and residency data collected through Ministry of Finance Property Transfer Tax Forms are recorded, analyzed and publicly available on a regular basis; and
Requisition a full provincial study to collect and analyze citizenship and residency data on all real estate property in British Columbia and publish the results.
 Statement from IAN CB SMITH, Retired Director of Land Titles for the Province of B.C.