The provincial government has further burdened home construction amid a slowdown by increasing housing-related taxes, says the BC Real Estate Association.

BCREA blasted Premier David Eby’s government Wednesday, a day after the province released its 2026 budget. The realtor group contends that the budget’s housing measures will will worsen affordability and further strain an already challenged development sector.

BCREA also chastized the Eby government for introducing a fiscal plan that fails to address mounting housing pressures while increasing taxes tied to development.

“These tax increases will only make an already challenging development climate more difficult,” the association said.

With the provincial economy facing external headwinds and uncertainty, BCREA said it is unsurprising the BC government is running a sizable deficit. However, the association warned that the absence of a clear plan to return the provincial debt-to-GDP ratio to a sustainable path raises concerns about the province’s fiscal health. Mounting debt and rising debt-service costs will constrain the government’s ability to provide tax relief for households or fund worthwhile programs, BCREA added.

“There is unfortunately not a lot to like from either a macroeconomic or housing perspective in this budget,” says Brendon Ogmundson, BCREA’s chief economist. “We understand that the province is in a difficult position and needs to raise revenues, but doing so on the back of an already struggling housing sector will ultimately prove to be self-defeating.”

BCREA described Budget 2026 as an important inflection point for housing affordability but argued that it failed to tackle either the growing tax burden or housing-supply challenges. At a time when new-home construction could slow significantly, the association said the government has chosen to further burden the development sector with tax increases, imperilling the province’s ability to meet its long-term housing supply targets.

In recent months, the Canadian Mortgage and Housing Corporation has warned that home-construction starts will slow down over the next year, particularly in the country’s high-priced large markets

Among the measures criticized by BCREA are higher school taxation rates on development lands, which the association said will increase costs that will be downloaded to buyers and further hinder project viability. The budget also applies provincial sales tax (P.S.T.) to professional housing-related services, increasing soft costs and further challenging the economic viability of projects.

In addition, the Speculation and Vacancy Tax will increase to 4% for foreign residents and others, a move BCREA said comes at a time when British Columbia needs to attract capital to boost housing supply.

Meanwhile, Mark Goodman, principal of Vancouver-based Goodman Commercial, which specializes in multi-family real estate brokerage also slammed the province, contending that it “really dropped the ball.”

“We’re facing a clear slowdown in development and housing – numbers don’t lie,” said Goodman in a LinkedIn post. “Instead of helping, the province added more costs for development land and building homes. It feels totally out of touch.”

Goodman pointed to a stoppage in presales, decades-high apartment vacancy, slowing immigration due to a change in federal policy and weak investor sentiment as signs that the housing sector needs help.

Municipalities are seeing fewer development applications and a thinning construction pipeline but the budget has raised building costs in a downturn, he contended.

“Money moves on,” said Goodman. “If the province doesn’t grasp this cycle’s depth and act, investment heads elsewhere.”

Pictured: Vancouver