VANCOUVER, BC / SEPTEMBER 22, 2017: Vancouver Greens and Federal Green Leader Call on Federal Government to Restore Tax Incentives for Purpose-Built Rental Construction and Renovation
Vancouver, BC — Pete Fry, the Green Party of Vancouver’s candidate for City Council in the October 14th by-election, is calling on the federal government to reinstate tax incentives for purpose-built rental apartment construction and to expand the original program to cover investments in maintenance and renovation of rental buildings as well.
“More than half of Vancouver residents are renters. More than one quarter spend more than 50% of their income on rent. The vacancy rate in Vancouver has hovered below 1% for years. We need to build more rental housing, keep it in good repair, and renovate as much of the older stock as possible to avoid the tear-down of the most affordable rental housing in Vancouver. Federal tax incentives have worked before. We need to get them back in place fast,” said Fry.
Fry also noted that the City of Vancouver, notorious for long lag times in obtaining development and building permits, must streamline processes to ensure that construction and renovation permits for rental buildings are fast-tracked. " Every year brings a new record in numbers of building permits, but Vancouver's building permit approval system is the slowest in the GVRD. There is definitely room to streamline that process. Time is money. Properly resourcing our permitting staff provides good value. It will alleviate the rental housing crisis and better serve our beleaguered renters."
Elizabeth May, Leader of the Green Party of Canada and Member of Parliament for Saanich-Gulf Islands, said "I have been pressing both Conservative and Liberal Finance ministers on the need to restore the previous incentives for purpose-built rental housing. It is a key bridge in our housing continuum between social housing and home ownership. As someone who does not own a home myself, I know the benefits of the rental housing stock. We need to build more sustainable and human-scale rental housing."
Federal income tax incentives in place from the mid 1970s to early 1980s generated a “golden era” of purpose-built rental construction across Canada. More than one-third of Vancouver’s rental suites were built in that era, and they continue to be the bulk of the city’s most affordable, decent-sized rental apartments.
According to a 1998 research study by the Canadian Federation of Apartment Associations: "Changes in the tax treatment of losses due to capital cost allowances (CCA), the amount of CCA deductible, allowable soft costs, and the deferral of taxes payable on recaptured depreciation upon reinvestment, and the application of a tax on capital gains at the time of sale have severely reduced the attractiveness of investing in rental housing."
“Facilitating more construction of rental housing is crucial" said Adriane Carr, Green City Councillor. "But it has to be affordable for Vancouver renters whose median income is less than $50,000. One way we can do this is to retain and upgrade as much as possible of the most truly affordable rental stock in the city--the older apartments that people so love to live in,” she concluded.