BCREA’s Position on Shelter Taxes
BCREA describes the Property Transfer Tax (PTT) as a provincial shelter tax. The PTT negatively impacts the affordability of housing, which directly impedes the quality of life of British Columbians.
BCREA Recommends the Provincial Government:
- Ensure that real estate transactions already underway are eempt from any future changes to the PTT.
- Use the new Housing Priority Initiatives Fund to increase the 2% PTT threshold from $200,000 to $525,000.
- Index the following PTT thresholds using the MLS® Home Price Index, and make adjustments annually:
- 2% and 3% thresholds,
- First-Time Home Buyers' Program exemption threshold, and
- Newly Built Home Exemption threshold.
On August 2, a new, additional Property Transfer Tax took effect. The tax of 15% applies to purchases of residential real estate in the Greater Vancouver Regional District (except for Tsawwassen First Nations lands) by foreign nationals or foreign corporations. No exemptions are available for these buyers.
On May 10, Minister de Jong announced that, beginning in June 2016, the BC Government would begin collecting citizenship data through the Property Transfer Tax form.
With the 2016 BC Budget, and effective February 17, 2016, two changes have been made to the Property Transfer Tax:
- Newly-constructed homes used as principal residences, up to $750,000, are exempt from the PTT. A partial exemption is available for new homes up to $800,000. This is for all buyers, not just first-time buyers. More information.
- The PTT rate is increased to 3% on the portion of a property’s fair market value above $2 million. Rates of 1% on the first $200,000 of a property’s fair market value and 2% on the fair market value between $200,000 and $2 million will continue to apply. More information.
The PTT exemption threshold under the First Time Home Buyers' Program was increased to $475,000 from $425,000, effective for registrations on or after February 19, 2014. The partial exemption/phase out applies between $475,000 and $500,000. This is certainly a positive development for first-time homebuyers.