Tackling Housing Affordability in Budget 2018
Housing affordability is a central focus of the provincial budget announced on February 20. The government's 30-point "Homes for BC" plan outlines their approach.
Some of the key points of the plan include:
- Introducing a "speculation tax," charging residential property owners who don't pay income tax in BC, at an annual rate of 0.5 per cent in 2018 and two per cent in 2019 of the assessed value of their property (effective starting in the 2018 tax year)
- Increasing the tax on foreign buyers to 20 per cent, and widening its scope to include the Victoria, Nanaimo, Fraser Valley and Central Okanagan regional districts (effective February 21).
- Increasing the Property Transfer Tax rate in the third tier (over $3 million) to five per cent (up from three per cent) (effective February 21).
- Increasing the provincial school tax on properties with a value over $3 million (beginning in 2019).
- Investing $6.6 billion over the next ten years to increasing the supply of affordable homes.
- Investing an additional $378 million over the next three years to increasing "missing middle" rental stock.
While BCREA welcomes the government's commitment to increasing the supply of affordable homes, we're concerned about the negative impact the additional taxes may have. The proposed taxes do nothing to address the real problem of matching housing supply to demand within a reasonable timeframe, and so BCREA will continue to advocate for these changes in a way that represents the best interests of REALTORS® and their clients.
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