Kyle Kerr 2018 President of VREB - Outgoing comments - the year in review
H&L: How was your year?
KK: It was great. This was the 97th year of the Victoria Real Estate Board so there was a lot of history and experience to uphold, but it has been an honour to serve as President. A key theme for me this year was transition - both for our member Realtors and for local consumers. This experience of selling and buying a home in our community has changed a lot for consumers recently - over the course of the past three years the market in Victoria experienced its biggest sales volume ever, at and unprecedented pace. More recently we have seen a slowdown of what was once a very high pressure market, which I think is a relief to everyone, but in some markets pressure on price and availability remain. Realtors in BC weathered a lot of change this year: due in part to sweeping changes n the way the industry is regulated. This of course lead to a busy year at the Board, both working to connect the regulators with the information they needed to enact change to the industry and educating our membership on how the way the run their businesses is changing.
H&L: Any other factors influencing the market or changing the landscape for consumers?
KK: For sure. One of the biggest influences we have seen this year is the federal government's roll out of the new mortgage stress tests, which reduced the amount of money many consumers are able to qualify for to purchase their home. This change combined with increasing interest rates has meant that consumers are shipping with smaller budgets in a housing market that has lower inventory and that can be a challenging place to be. On the other hand, we have seen a lot of new condo projects in the city break ground, and some great developments in the Western communities are adding more affordable housing into the market. If our community continues to support developers and considers changing zoning in key areas to allow for more density, the situation for home shoppers may improve in the long term, which is a good thing.
H&L: You've done a significant amount of travel on behalf on VREB this year? That must really broaden your perspective. Where did you go?
KK: Ottawa, twice: In the spring for the Canadian Real Estate Association's Annual General Meeting and in the fall, when representatives from boards across Canada attend for a national advocacy conference.
The advocacy conference was a standout experience, thanks to presentations made by the head of the CMHC and Leader of the Conservative Party Andrew Scheer. We also met with our local MPs to connect on what the politicians in Ottawa are doing for folks in Victoria. Right now the current government is making funds available for social and affordable housing which will assist our market here in BC.
It's good to see that the nearly two billion dollars collected in Property Transfer Taxes will be spent in this direction.
I also travelled to Boston this fall for the National Association of Realtors Conference and Expo. This is the largest annual event for real estate professionals in North America and fives our board an opportunity to network with realtors from around the world.
H&L: What is your interpretation of the impact of the Speculation Tax we've been hearing so much about in the news?
KK: A punitive tax is not the right mechanism to open up or encourage affordable housing - the tax sends a message that BC does not want investment from outside of our province. However, speculation tax is the form of development funding benefits our economy and is often required to get projects going as often pre-sales commitments are required for funding to be release by lenders. Moving forward it may be increasingly difficult for our local developers to qualify for the loans they need to build here, which is unfortunate as these projects inject so much in the economy, thus helping all levels of housing affordability through industry employment.
Funds generally need to be available 2 or 3 years before the builds are ready for occupancy - and not many first time or single home owners can take that time to wait or put that much of their money at risk.
H&L: So what would be the best situation for affordable housing if the Speculation Tax is not the answer?
KK: Supply is the solution. Our municipalities need to look at new ways of using our limited land - allowing more creative use of space to produce more diverse housing options. They also need to work with developers as partners in improving our communities.
H&L: What do you see for next year?
KK: Victoria will always have a high demand for housing because we have a strong and diversified local economy. PLUS, our lifestyle is enhanced by the outdoors - our access to the ocean and mountains our mild climate. We have something very special here on the island, and as people in Canada and other places in the world are more exposed to our city they want to live here too. There should be no drop in the real estate industry for the foreseeable future.