As we previously wrote, the B.C. government has considered changes to the additional tax on foreign home buyers in Vancouver in order to remain attractive to prospective employees. On March 17, the province confirmed the scope of their changes.
A new international survey shows that Vancouver continues to be the least affordable city to buy a home in Canada – and ranks third internationally. But would you believe that Victoria comes in at second on the list in Canada, less affordable than all of the other major markets considered in the study?
The B.C. government is planning to lift the levy on foreign home buyers in Vancouver for those who have a work permit and pay taxes in the province. Originally implemented in August 2016, the 15% foreign home buyer tax had an immediate impact of reducing the number of real estate transactions involving foreign buyers. In Metro Vancouver, there were 1,974 deals involving foreign buyers from June 10 through August 1, 2016. In the remaining month of August 2016 there were only 60 transactions; the volume has slowly recovered and there were 200 transactions during November 2016.
This change is seen as a way for employers to continue to attract skilled employees and remain competitive in business; it has been much more difficult to recruit individuals who are interested in moving to the province to live and work since the tax was introduced. Critics have welcomed the updated rules.
The exact details of the amendment are being finalized and will soon be enacted through a provincial order in council. There is currently no plan to change the area affected by the tax, which includes 22 communities in Metro Vancouver.
If you have questions about your specific situation, contact Auxilium Mortgage today for a free consultation with one of our brokers: call Toll-Free 1-855-590-6520 or visit us at 307 Goldstream Avenue during regular business hours, Monday through Friday 8:30 a.m. – 5:00 p.m. We can also arrange an appointment evenings or weekends to work with you.
Auxilium Mortgage Corporation is based in Victoria, BC and works with clients locally and across Canada. The Auxilium team has over 100 years of combined financial experience and access to dozens of lenders to help you meet your goals.
Victoria is now second only to Richmond in the number of residential real estate transactions in this province involving foreign buyers. According to data from October, 6.3% of the sales in the Capital Regional District were to non-residents. This volume is almost double the amount of September transactions.
Continuing to chase Vancouver investment property, investors are willing to pay a hefty price to get their hands on any.