After years of unending price growth and complaints of foreign (mostly Chinese) nationals buying up all the desirable real estate in Vancouver, the provincial government is finally addressing it.
The Toronto Star reports that any foreign national who buys property in Metro Vancouver will be subject to a 15% property tax on top of the regular costs. The tax will take effect Aug. 2 and is part of the government’s efforts to help keep vacancy rates low and high prices from inflating any further. Money generated from the tax is to be used to fund housing, rental, and support programs.
The new legislation has been carefully crafted in order to prevent savvy buyers from avoiding the tax. Another big change it brings is that it the City of Vancouver will be able to tax vacant homes.
For many, this decision is a good move on part of the government. People complained about foreign buyers driving up prices by buying up homes and leaving them vacant, but there was very little data supporting the concerns. After both the provincial and federal government made studying the issue a priority, we’re seeing the result of the investigation. While foreign investment in real estate is desirable, the main issue with it happening in Vancouver was the vacancy problem. Hopefully this new legislation will address that issue.