Alberta Family on housing tax: ‘We don’t feel like foreigners’

Reaction continues on the speculation tax announced by the province for Kelowna, West Kelowna

To the editor:

I’m writing this letter in response to the proposed legislation brought forward in the current BC budget, regarding new tax on certain BC properties owned by non-residents.

As a precursor and to provide background, I’d like to tell you a little about my family and our long standing involvement in the Okanagan. We are a large Alberta family with lots of siblings, nieces, nephews, and grandkids. Our larger family has enjoyed and embraced the Okanagan and it has been a big part of our summers and winters for 3 generations now. We love this wonderful and great part of Canada.

We are also fortunate people and several of my family, who has vacationed in the Okanagan for many years, now own property. We also are actively involved in the real estate development business based in Alberta.

I believe I can speak for my larger family by saying although we pay income tax and have our principal residence elsewhere, we feel far from foreigners. On the contrary, we feel very much part of the communities where we own properties. We feel very connected to the communities and have long standing relationships and friendships with local service providers, stores, restaurants, vineyards contractors and others.

Speaking for myself and my direct family, I take great exception to being identified as a “foreigner” and the cause of a larger problem. I also feel as Canadians we must remember our great opportunity to work together and to avoid the “us vs them” mentality. Our West Kelowna property is not a speculative real estate investment it is our “second” home. We are, in a way, a great advantage for the municipalities where we own as we pay taxes, support the economy and we use very few municipal services.

Our West Kelowna home requires a significant amount of annual financial commitment which all goes to taxes and the local economy. If this non-residents tax is approved in its current form, it will be the tipping point for me and we will sell. This will directly affect all our service providers including landscapers, contractors, boat service people, and on and on. On this point I can’t speak for my larger family but I know they are very concerned as well. I also know a large number of our friends and their families, who own BC property, feel the same.

I would be interested to know if in deliberating this tax consideration was given to the several local industries that have grown to service this large group.

If the goal of this tax is to reduce property values it will likely succeed but what kind of real estate? Will it reduce all values or just the more expensive recreational properties? I can’t imagine, even if this tax significantly reduces the value of higher priced properties, how it will benefit people living and working in the local municipalities?

Additionally, if this tax is a success, the unintended consequence will most definitely be less demand for local service providers and job loss. These two issues have a direct indisputable correlation.

I’d like to get back to my experience in the real estate business. I like to think we have a good level of expertise in this area as we have been in the business for several generations. We know that over the long run money is made in this industry by hard work and value creation NOT from speculation!

My own situation is a good example. We have owned our property for close to 10 years and we bought it at a high point in the market. We have regularly updated and maintained our home (using all local service providers). We have paid property taxes and supported local initiatives. We would be hard pressed to recover all of the money we have spent if we had to sell. If our intention was speculation for profit it would be the worst real estate decision I could imagine.

I can accept that this non-residents tax is being contemplated from the best of intentions and it will likely work at reducing real estate values but the other indirect negative impacts will be significant and will likely far outweigh the benefits. I seriously question if it will have the desired effect to make “homes” more affordable.

My family and my friends will be greatly impacted BUT so will the residents of the affected municipalities and we strongly encourage you to reconsider implementing this tax.

Andrew Melton family, West Kelowna/Alberta

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