Condo king Bob Rennie suggests a speculation tax on real-estate flippers
The city’s most famous real-estate marketer has said he’s “leaning toward” supporting a levy on people who buy and then sell homes over a short period of time.
“I suggest we look at a declining tax that sees a percentage of profits taxed if a home is sold—whether it’s three months, whether it’s six months, or if it’s sold within 18 months,” Bob Rennie said in a speech today to the Urban Development Institute.
The founder of Rennie Marketing Systems offered two explanations for bringing forward this idea to a crowd of more than 1,000 at the Hyatt Regency Hotel.
“The first is that I hate the racist undertone that is rampant out there, so I think we need a visible, measurable gesture,” he said. “Secondly, if speculation is a huge negative contributor to affordability, then let’s repatriate some of the money back to our first-time buyers that we collect.”
He suggested that perhaps this measure could provide sufficient revenue for a $5,000, $10,000, or $15,000 grant to first-time buyers, based on their length of residency in the city or income. He added that perhaps these grants should only go to people who can prove that they don’t have parents sitting on huge amounts of real-estate equity, which could be used to finance a future down payment.
“I’ll drop the pebble on the pond,” Rennie said. “Someone a lot smarter than me can figure out where this conversation needs to carry on.”
In addition, he suggested that imposing a surcharge on owners of vacant homes could go to a “cut-your-grass fund and a fire-safety monitoring fund”.
Following Rennie’s speech, Mayor Gregor Robertson’s office emailed an unsolicited news release to the Straight expressing support for a speculation tax.
“It’s clear that rampant speculation on real estate is driving up prices in Vancouver,” the mayor declared in the news release. “Vancouver needs the BC Government to take action on creating a speculation tax and recognize that we need a fair and level playing field to make housing more affordable for residents in Vancouver, and throughout the province.”
The mayor’s office’s statement took a swipe at the federal government for its “complete absence in supporting low and middle income housing”, which “is making it extremely difficult for people, especially young people, to live and work in Vancouver”.
Rennie has been a major political supporter of Mayor Robertson and Premier Christy Clark.
Meanwhile, Rennie told the UDI audience that he opposes taxing foreign investors in residential real estate.
He cited sales figures from three projects that he marketed to suggest that foreign buyers form a small portion of overall purchasers in Vancouver.
At the Independent at the corner of East Broadway and Kingsway, only three percent were offshore Asians and two percent were offshore Europeans.
Then he said that at Strathcona Village at 900 East Hastings, none of the buyers were offshore. A third project, Wall Centre Central Park, had less than three percent offshore buyers—17 Asians and 13 Europeans out of 1,009 units sold.
“I’m concerned that we are going to be sending a message to all of our foreign investors from India to Indonesia that if you tax foreign investment on housing on a Monday, you may tax foreign investment on technology, on LNG, and on manufacturing by Friday, hurting job creation,” Rennie said.
