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B.C. finance minister not ruling out tweaks to new housing taxes

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Feb. 20: The NDP government has tabled a budget with a surplus despite spending $1 billion on child care. Richard Zussman tells us how the government will pay for it.

B.C.’s finance minister is not ruling out tweaks to the aggressive suite of new real estate taxes unveiled in Tuesday’s budget.

The comments came in the wake of some concern that the NDP’s plan could knock the bottom out of the province’s real estate market.

The plan includes a speculator tax that climbs to two per cent next year, an expanded foreign buyers’ tax and a bump in the property transfer tax on homes worth more than $3 million.

READ MORE: What’s in the BC NDP’s $6B plan to fix the housing market?

Finance Minister Carole James said Wednesday that the NDP’s goal was to moderate the market, and acknowledged that people could see the value of their homes drop.

On Thursday, she said the government was open to amending the policy if needed.

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“That’s why I said, as I announced the budget, that we’re going to be watching this housing plan closely,” she said.

“There may be changes that need to occur as we’re moving along on this tax.”

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But the BC Greens, the NDP’s erstwhile legislative allies, are raising concerns that the governing party may be operating without a clear road map.

“We’ve been stonewalled on that,” said Green Leader Andrew Weaver.

READ MORE: B.C. budget 2018: Government plans to add speculation tax, eliminate MSP

Weaver said he wants to know if the NDP’s goal is to slowly deflate the real estate market, pop it like a balloon, let it slowly continue to rise or something else entirely.

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“We suspect the outcome that is being sought is the outcome that has happened, so that when you get an outcome you just say after the fact, “This is the outcome we were looking for,” Weaver said.

“But that’s not what you put in public policy for.”

Weaver said he wanted to see bolder measures like a ban on foreign buyers and immediate action on bare trusts, but that Greens plan to support the NDP budget.

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B.C. finance minister addresses affordable housing in budget speech

Vancouver-based real estate agent Steve Saretsky said from his perspective, where the government is heading looks fairly clear.

“I think even with Carole James coming out and saying their goal behind this is to basically reduce house prices and bring them down to an affordable level, I think that sort of states where this government is coming from,” he said.

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And while he said that the mood in the real estate sector generally remains bullish on rising home pierces, he believes change could be coming.

“A lot of the industry feels like no policy can impact prices, but I think it’s substantial, it’s a pretty big tax,” he said. “A lot of that is psychological, right.”

READ MORE: New mortgage rules 2018: A practical guide

Saretsky added that the NDP’s plans came just as the federal government’s newly-tightened mortgage lending rules begin to take hold, a major change with impacts that he says have yet to be felt in the market.

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“I think if you keep throwing more and more policies, I think something is going to budge eventually,” he said.