Kathy Tomlinson from the Globe and Mail recently uncovered a system of speculation and insider trading that is fuelling the red-hot condo market in Vancouver and crowding out ordinary buyers. I sought to explore this further in Question Period today. In particular, I asked the Minister of Finance what she was doing to clamp down on this egregious behaviour.

I was very pleased with her response.

In my supplemental question, I asked the minister if she would consider stepping in to rectify a problem that has arisen from the upcoming ban on limited dual-agency transactions in the real estate sector. The BC NDP inherited this problem from the BC Liberals’ “sledgehammer” approach to dealing with what was largely a Metro Vancouver issue. There are profound consequences for rural BC if this ban goes ahead.

I remain optimistic that the Minister is aware of the problem and is sympathetic to taking action prior to the June 15 deadline. I will raise this issue again during Ministry of Finance estimates.

Below I reproduce the video and text of our exchange.

Video of Exchange

Question

A. Weaver: Kathy Tomlinson from the Globe and Mail recently uncovered a system of speculation and insider trading that is fuelling the red-hot condo market in Vancouver and crowding out ordinary buyers. A few select realtors and industry insiders are getting preferential access to new condos under construction, and some individuals are flipping the right to purchase these condos multiple times prior to anyone actually moving in, a process that artificially drives up the prices for the eventual homeowner.

Industry insiders and speculators shouldn’t be granted preferential bidding rights on new condo units. Ordinary British Columbians and young families trying to get their foot in the door should have the same access.

My question to the Minister of Finance is this. What is your ministry doing to end this egregious practice and to stop the preferential treatment of industry insiders over regular British Columbians? And will you end preferential treatment and require that developers market their condo developments at the same time and at the same price to everyone?

Answer

Hon. C. James: Thank you to the Leader of the Third Party for the question, and thank you for pointing out one more area that has to be addressed in the housing crisis that we are facing in British Columbia. I’m sure the member, as we all do in this House, hears the stories, the heartbreaking stories, every single day of people trying to get into the market. Then to hear about this kind of action — the insider flipping of presale condos — is very troubling. It’s very troubling, I’m sure, to everyone. It’s certainly troubling that that legacy has been left, and it is something we’re taking action on.

We have regulatory authorities, right now, investigating those reports. The member can be assured that this is a top priority for our government. We’re also taking action to actually clean up this mess. I think one of the things, and I’ve mentioned this before…. One of the real challenges is that the old government collected no information, so there is very little information to be able to take a look and get to the investigation piece.

We are doing that. We are taking action to actually require information on presale condos, on flipping of condos, to be gathered by developers. It’ll shine a light on this sector. It’ll ensure that we can share that information, then, with the tax authorities so that people are paying their fair share of taxes.

Then the one other piece I just want to mention to the member is that we’ve also initiated a review of the real estate regulatory system to also ensure a level playing field. It was a system left to us by the old government. They put a structure in place that clearly needs some work. There are questions raised about who has what authority, where that authority sits. So we’re going to be looking at the roles, the responsibilities, clarifying the issue of education to ensure consumer protection, which is the primary issue in this example and so many other examples in the housing crisis.

Supplementary Question

A. Weaver: Thank you to the minister for that very constructive response.

As the ministry knows, much of the dubious behaviour in the real estate sector has taken place in the overheated Vancouver real estate market. I think we can all agree that it’s essential to put in place new rules to end these abuses and to protect consumers, and I’m thankful that the minister is taking steps in this regard.

Yet it’s also crucial that any new rules don’t impact businesses and communities in smaller communities across British Columbia. Scores of realtors and brokers from smaller communities across rural B.C. have contacted me with serious concerns about the government’s plan to ban limited dual-agency transactions. In many small towns in rural regions, the new rule may be unworkable for small businesses. It will have a profound negative impact on consumers as well.

I’m worried, frankly, that this government inherited a sledgehammer response to reform from the B.C. Liberals that could have serious unintended consequences for realtors and consumers in rural B.C.

My question to the Minister of Finance is this. Will the minister consider delaying the implementation of the ban on limited dual-agency to enable a task force to review the effects of the proposed changes on small communities and to provide a way forward that protects consumers and doesn’t harm people in rural B.C.?

Answer

Hon. C. James: Thank you for the question, and thank you for raising the issue. I’ve certainly heard the concerns directly, but I know members on all sides of the House have heard those concerns in their communities as well and heard the concerns from realtors.

Just to be clear, the office of the superintendent is an independent regulator. And as the member said, they’ve introduced new rules banning dual agency designed to protect the public that are effective June 1. As I’ve said, I’ve certainly heard those concerns. I’ve met with the superintendent. I’ve met with the real estate board to raise those concerns, to make sure that they are well aware of them.

We want to make sure that the regulators are working as effectively as possible. As I mentioned, we’re also doing a review of the regulators themselves. But my expectations are clear. Consumers have to be protected, and all consumers should have the right to representation whether they live in rural B.C. or whether they live in urban B.C., whether they live in a small community or whether they live in a large community. I made that very clear to the superintendent and to the real estate board.