Liberal leader Justin Trudeau’s marquee housing affordability platform was dealt a public relations blow this week with the revelation that his party’s candidate for Vancouver-Granville has bought and sold at least 21 homes within a year of buying them, and appeared to embody the very predatory speculators Trudeau is trying to target with a new anti-flipping tax.
Vancouver radio station NEWS1130 reported that Liberal candidate Taleeb Noormohamed has made $4.9 million buying and selling 42 properties across Metro Vancouver the past 17 years, including 30 he held for less than two years, and 21 that were flipped within a year of purchase.
It was an embarrassing revelation for team Trudeau, which has already spent time in Metro Vancouver campaigning on a housing affordability plan that has a heavy focus on penalizing the villains it blames for skyrocketing prices - mainly, foreign buyers, along with those who play real estate like the stock market.
"We'll crack down on predatory speculators," said Trudeau.
The problem, as housing experts and B.C. data has long shown, is that the true speculators are British Columbians and Canadians who are already in the market and parlay that into the steady gathering of real estate wealth, either spreading it intergenerationally to their children so they can buy otherwise unaffordable homes, or buying up investment properties in hotspots.
It’s a very slippery slope for politicians targeting those kinds of voters.
Most of them think of themselves as deserving of the wealth they’ve accumulated from their 30-year-old Metro Vancouver homes, or the cash they got from their parents to start playing the market. Some consider it a mark of being a successful businessperson to be able to navigate multiple real estate investments for profit.
Noormohamed’s rate of flipping is outrageous. But in an interview with News1130 he claimed he was simply taking properties, renovating them with family members skilled in interior design and restoration, and then offering them unsuccessfully to other family members before putting them back on the market.
It sounds ridiculous, given 42 properties over 17 years.
But I bet there’s more than a few people out there on a smaller scale who consider buying, renovating, and flipping a handful of properties over two decades as a legitimate venture, and who would be surprised if political parties suddenly labelled them speculators.
That doesn’t mean the Liberal anti-flipping tax is wrong, by any stretch.
The party deserves credit for tentatively stepping towards penalties at the root of the problem, including applying those penalties to principal residences, which are generally exempt of capital gains taxes and have so far been the sacred cows of real estate.
Parties can, and should, make the tough decisions to follow the evidence in the housing crisis. And people like Noormohamed are a core part of the problem. They deserve to get hit with penalties.
Let’s just hope the Liberals don’t get scared off their anti-flipping tax once they realize the reality of who they are taxing.
Rob Shaw has spent more than 13 years covering BC politics, now reporting for CHEK News and writing for The Orca. He is the co-author of the national best-selling book A Matter of Confidence, and a regular guest on CBC Radio.
SWIM ON:
- Rob Shaw last wrote about threats from an angry mob, which forced Justin Trudeau to cancel a rally. Unfortunately, this wasn’t a unique event – regardless of region or party.
- No, it doesn't grow on trees. Jock Finlayson on the industries that drive BC's revenue streams.
- The housing crunch - and prices - has bedeviled governments at every level across the country. Mark Goodman and Cynthia Jagger have some advice for civic leaders: there is a route through this crisis, but it requires innovative thinking and a reversal of tired policies. (Build. Build more. Build more now.)
