Burnaby Beacon: Burnaby renters rail against REITs
Posted May 7, 2021
Posted May 7, 2021
A small group of Metro Vancouver renters descended on a Burnaby MP’s constituency office Tuesday morning as part of a coordinated nationwide action calling for the federal government to “rein in” real estate investment funds.
The Metro Vancouver chapter of tenants union and advocacy group Acorn Canada took part in the “Rein in the REITs” action, which targeted the constituency offices of 30 Liberal MPs. That includes the offices of Burnaby North-Seymour MP Terry Beech on Hastings Street.
Murray Martin, the Burnaby chair for Acorn, said Beech briefly emerged from the office and received a letter from the roughly 10 demonstrators but declined to comment to the group, saying he needed to review their research.
Acorn made 4 demands in its campaign, including requiring REITs to pay corporate income taxes on all earnings.
In the early 2010s, REITs were exempted from federal laws that caused flow-through entities—which pass their income on to investors—to pay corporate taxes on income. As it stands, only unspent REIT revenues are taxed at the corporate level, leaving only capital gains taxes to be paid by investors. Acorn calculated the lost tax revenue from 7 REITs to amount to $1.2 billion since 2010.
The 2nd demand from Acorn is for the Canada Mortgage and Housing Corporation to stop offering insured mortgage products at low interest rates to REITs, helping to fund their acquisition of properties.
“They’re being financed by the government to do this at extremely low interest rates,” Martin said.
The group also wants a national “non-profit acquisitions strategy,” which would give non-profits and co-ops the first bid for purchasing multi-family housing buildings that could be bought by REITs and flipped into more expensive units. Acorn suggested the program be funded by the CMHC on top of the National Housing Strategy’s existing funding.
This is similar to a proposal from the BC Non-Profit Housing Association and Cooperative Housing Federation of BC, which the Vancouver Sun reported last year was in talks with the provincial government to set up a $500-million fund to help preserve affordable housing.
Finally, Acorn wants a ban on REITs owning “certain types of multi-family residential buildings.” Acorn cites a move by Berlin, in which it planned to ban rental housing ownership by large landlords as an example.
Martin told Burnaby Beacon the issue with REITs is their tendency to renovate or replace older, affordable buildings with new units that are far beyond the affordability of its former residents, reducing the stock of affordable housing.
He noted the 6,000 units the federal government builds each year through its national co-investment fund and compared it to the estimated 14,000 units flipped by one REIT, CAPREIT.
Martin said Acorn wants the federal government to “tie the taxes they pay to the amount of affordability they preserve, because they’re not building new units. … They’re jacking the rents up.”
The action was taken now, Martin said, to get ahead of a potential election call in the coming months to try to make it an election issue.
“Because housing is out of control,” Martin said. “It’s been out of control for the last decade, but really the last 5 years have been—rental housing is just out of control.”
Martin said the group has not yet been in touch with NDP Leader Jagmeet Singh, who represents Burnaby South.
Article by Dustin Godfrey for the Burnaby Beacon