The recently tabled B.C. 2018-19 Budget Plan has revised some provincial housing regulation in effect immediately:
1. Stabilizing the market. Includes policies for:
- taxing speculators;
- increasing foreign buyers tax to 20%
- Applying the foreign tax outside of Metro Vancouver; For instance, in Victoria and Whistler
- Increasing taxes (school property tax rate and transfer) on properties over $3 million;
- implementing an “Airbnb” tax.
2. Cancelling the B.C. first-time homebuyers loan program – The provincially backed loan program came in effect on Dec. 2016. It was supposed to match the amount a first-time buyer up to $37,500, or five per cent of the home’s purchase price. In realty only 1200 first time buyers put an application with this program. Most our clients were not able to not benefit at all. Some would even lose money over the fees involved. The program will cease to exist on March 31th 2018.
3. Eliminating fraud and loopholes. Includes measures for: expanding collection and sharing of information across levels of government (it’s about time…); strengthening auditing procedures to prevent tax evasion related to pre-sale reassignment, hidden ownership, and the misuse of the Agricultural Land Reserve (ALR).
4. Aligning supply and demand: additional funding for homebuilding for various groups, including students, women and children affected by violence, the Indigenous, and people struggling with homelessness.
5. Strengthening security for renters. Includes expanded benefits for seniors and working parents.
6. Preserving affordable housing. Includes policies designed to boost investment in affordable homes and infrastructure.
In the long run, BC will enjoy benefits for the housing market and the economy. In the shorter run, the plan should shrink 5%-10% of the real-estate activity and push prices down.