June 7, 2019 Randeep Sarai Member of Parliament, Surrey Centre Valour Building, Suite 860, House of Commons Ottawa, Ontario Sent by email:
[email protected] Dear Mr. Sarai, RE: B-20 stress test Thank you for arranging a roundtable discussion with housing sector professionals at the Surrey City Centre Library on May 22. We appreciate the opportunity to connect and provide feedback on how federal policies impact BC REALTORS® and the housing market. The B-20 stress test has had a pronounced regional impact in BC, causing harm to the BC economy and making it harder for British Columbians to realize their dream of home ownership. Home sales have declined by 25 per cent across BC and by 33 per cent in Surrey in 2018. Research from the BCREA Economics department shows that the B-20 stress test resulted in an estimated 30 per cent of that decline, or 8,000 lost home sales. The B-20 policy creates vulnerabilities, resulting from an overreach in policy is likely to result in negative economic outcomes, including a decline in new home construction and rising unemployment. BCREA estimates that home price declines exceeding 10 per cent in one year would have a negative impact on housing supply. A decline in housing starts means that once housing demand recovers from a price shock, it is likely that supply will be inadequate, leading to future price accelerations. This concern has been corroborated by homebuilders across BC, including Randeep Sarai Page 2 June 7, 2019 several in your riding who shared their stories at your roundtable discussion in May.