July 31, 2016
Despite concerns expressed by many groups including our Board, the Real Estate Board of Greater Vancouver and BCREA, the BC Government passed legislation on Thursday, July 28 to add a 15 per cent Property Transfer Tax on foreign nationals buying real estate in Metro Vancouver. The government says the additional tax will take effect August 2 and will apply to foreign buyers registering the purchase of residential homes in Metro Vancouver, including presales but excluding treaty lands in the Tsawwassen First Nation. Provincial Finance Minister Mike de Jong unveiled the tax as part of legislation aimed at addressing low vacancy rates and high real estate prices in southern B.C. “For example, the additional tax on the purchase of a home selling for $2 million to a foreign national will amount to an additional $300,000,” de Jong told members of the legislature. All BC residents currently pay a one per cent tax on the first $200,000 of their purchase, two per cent on the remaining value up to $2 million and three per cent on any portion above that. “The amendments include anti-avoidance rules designed to capture transactions that are structured specifically to avoid the additional tax,” de Jong said. The revenue from the additional tax would be used to fund housing, rental and support programs, the minister said. De Jong said recent government housing data indicate foreign nationals spent more than $1 billion on BC property between June 10 and July 14, with 86 per cent on purchases in the Lower Mainland area.