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Land reserve limits foreign impact on farmland
[Peter Mitham]

DELTA – The province’s move to tax residential property purchases by foreign nationals has sparked debate among agriculture land advocates for greater scrutiny of farmland acquisitions.

On July 25, Victoria announced a 15% tax on purchases of residential property in Metro Vancouver by foreign nationals effective August 2. The tax applies to standard residences as well as purpose-built apartment blocks.

Residences on agricultural land are also subject to the tax, along with any land zoned for residential purposes; if the residence sits on agriculturally-zoned land, then up to a half hectare (1.25 acres) around the residence is subject to the tax.

The move aims to make Metro Vancouver housing more affordable by cooling foreign demand and was part of a legislative package that also enables Vancouver city officials to introduce measures that discourage vacant homes.

The issues will sound familiar to young farmers in the Lower Mainland, many of whom find it tough to enter farming in a region where the price of land often puts ownership out of reach of everyone but established farm families with good succession plans.

Meanwhile, researchers at Kwantlen Polytechnic University recently completed a report for credit union Vancity estimating that a quarter of the available agricultural land in the Lower Mainland is sitting idle. But that doesn’t wash with Delta councillor Ian Paton, a farmer in East Ladner who says that most of the farmland he sees – regardless of ownership – is in production.

“So far in Delta, I don’t see any land really sitting idle because every guy in Delta is looking for more land,” he said. “Most of the guys that own land that don’t necessarily live on the property – maybe they live in Vancouver, maybe they’re out-of-country people – at least they’re leasing their land out at a fairly reasonable rate to all the guys that are bonafide farmers looking for more land.”

Trying to cast blame on foreign buyers – who have always been a factor in the local market, he pointed out – overlooks the fact that most foreign buyers are well aware of the conditions the Agricultural Land Reserve imposes on their purchase.

A recent report by the Reuters news agency pointed to an influx of Chinese buyers keen to secure land for blueberries for which Canada now has access to China; earlier buyers have purchased properties and leased them back to local farmers.

“It doesn’t really bother me who buys it as long as they intend on farming it or they intend on leasing it out to a bonafide farmer who needs more land to farm,” Paton said, adding: “Some of those people are doing as good or better than the rest of us farming land in the Fraser Valley.”

Independent Delta South MLA Vicki Huntington questions the short-term impact and long-term motives of foreign buyers in the BC marketplace, however.

Buying land and keeping it in production is one thing, she said, but during her travels last year as part of the Opposition Standing Committee for Agriculture and Food, she heard several reports that foreign buyers were outbidding local buyers for farmland.

“There’s a lot of anecdotal evidence that of course there’s a lot of foreign ownership of ag land that’s being held for investment, or up in the north where the Chinese are actually sending product back to China,” she said. “[This] does two things, a) it tends to start pushing that price of land up a bit, then secondly, it removes productive land from your local farmer.”

It’s not just purchases such as those by Reckitt Benckiser Inc. for a carbon offset scheme, now stalled, but Chinese investments in forage land and processing plants to supply parched ranches in China.

“We heard from a number of farmers and ranchers, especially in the north, that they felt that we should be starting to track those purchases,” she said.

Huntington has pressed the province on the matter and has been told it’s happening.

It’s not that foreign purchases are bad in themselves, she emphasized; it’s that there’s no way of knowing the impact it’s having on the ability of BC farmers to supply the province with the crops it needs, from forage to fruit.

“If an investor leases their land on a good-term lease to a local farmer, sometimes that’s almost as good as owning the land. … But if it’s just going to be held there and the push is solely to hold it for development, is that the best use for agricultural soil?” Huntington said. “What you want to do is either prove or disprove the rumours surrounding land acquisitions.”

Paton, for his part, wants to make sure owners make the most of their properties.

Keeping land in production is one issue but as a councillor, he shares the concerns of his counterparts in other municipalities that rural residences aren’t getting the attention they deserve.

A few years ago, monster homes were a burning issue; now, some rural residences are being neglected by owners who want to work the properties rather than live on them.

“There’s guys buying up farms that had beautiful old heritage houses and stuff like that and they slap in some blueberries,” he said. “They don’t rent the house out; they just board up the house windows. … They don’t care about the house or the farmyard. That’s a bit discouraging.”

The homes are valuable assets, with the potential to provide housing to farm managers and workers – something many farmers struggle to secure.

Paton plans to research a motion that will encourage rural property owners to maintain farm homes on their properties, even if they aren’t living in them.

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Vol.102 Issue 9