Development is suffering in Kelowna and West Kelowna is suffering, and trepidation over the government’s proposed speculation tax is to blame.
That’s the view of the Okanagan chapter of the Canadian Home Builders Association.
Following a gathering of forces against the tax, scheduled for implementation in the fall, association president Justin O’Connor said the effects are already being felt on both sides of the lake.
“We have kind of lived and breathed it here for a few months, even before anything is written in legislation,” said O’Connor.
“We’re seeing things slow down. Business owners are concerned and different retail businesses.”
The provincial government says the tax will help British Columbians afford to live in their own province, by pushing speculators out and turning vacant or underutilized properties into usable homes.
O’Connor says he agrees with philosophy, not the method.
“We would support a true spec tax of flipping tax if there were proper measures in place,” said O’Connor.
Kelowna and West Kelowna are the only communities in the Okanagan which will be affected by the tax. Other communities on the Lower Mainland and Vancouver Island are also on the list of those who will be hit.
The impact, he says, is telling.
“You have already seen projects put on hold in Kelowna and West Kelowna and, as a result, there is a massive impact on jobs which is very concerning.”
He pointed to 1,000 homes on the Westside which have been put on hold, as well as non-residents who were hoping to move here in the next few years who have put home builds on hold.
“People are concerned what it is going to be doing to our economy.
“It’s punishing Canadians for investing tax-made Canadian dollars in Canada.”
O’Connor also says several questions need to be answered, such as what does success look like.
“In a balanced economy, you’re looking at a two to three per cent vacancy rate (Kelowna is under one per cent).
“If there is a tax, how is success going to be measured. If we reach two or three per cent vacancy rate, are they going to scrap it? We just don’t know how success is going to be measured.”
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