Vancouver declares 5% of homes empty and liable for new tax

Authored by theguardian.com and submitted by madazzahatter
image for Vancouver declares 5% of homes empty and liable for new tax

After introducing a 20% tax on foreign buyers, the city in western Canada is continuing to tackle housing affordability

Thousands of homes in Vancouver have been declared unused and liable for a new empty homes tax as part of a government attempt to tackle skyrocketing home prices and soaring rents.

About 4.6% or 8,481 homes in the western Canadian city stood empty or underutilised for more than 180 days in 2017, according to declarations submitted to the municipality by 98.85% of homeowners.

The story of No 20: how does a London family home end up empty in 2018? Read more

Properties deemed empty will be subjected to a tax of 1% of their assessed value.

Vancouver has rolled out a raft of measures to cool prices and improve housing affordability in the country’s most expensive real estate market.

Empty houses, also a big issue in the UK, are only one aspect of the problem. In 2017 the provincial government of British Columbia raised its foreign buyer tax from 15% to 20% to target offshore investors blamed for pushing up prices. Toronto, Canada’s biggest city, followed suit with a 15% tax in April.

Before the foreign buyer tax, sales agents said investors in Hong Kong, China and other parts of Asia were acquiring up to 40% of Vancouver condominium projects marketed abroad, absorbing the more expensive units that domestic buyers could not afford.

Nearly 61% of the homes declared empty in Vancouver were condos, and other multi-family properties made up almost 6%, according to the city government. More than a quarter of the empty properties were in downtown Vancouver.

Property owners who did not submit a declaration and those who claimed exemptions, such as for renovations or if the owner was in hospital or long-term care, were included in the empty homes number.

“This is not insignificant considering that the rental vacancy rate is less than 1% in Vancouver,” said Robert Hogue, senior economist at Royal Bank of Canada. “This kind of data is completely new so it is difficult to put into context.”

CaptainTomato21 on March 8th, 2018 at 06:56 UTC »

Lack of affordable housing can destroy your life. Paying 50% of your monthly salary just for housing.... Seems to me more like a scam.

Life_outside_PoE on March 8th, 2018 at 06:34 UTC »

They introduced a vacant penalty for properties in Australia... In Victoria :

It is an annual tax of 1 per cent of the capital improved value (CIV) of taxable land. For example, if the taxable land has a CIV of $500,000, the tax is $5000.

Aka. Fuck all. If someone is dropping millions on a house, do you think they'll care about having to pay a tax of 1 per cent a year? It's an insult because it means they considered the problem and that was the best they could come up with.

shaebae94 on March 8th, 2018 at 06:31 UTC »

The tax on foreign buyers was only 15% and there were many loopholes. It was not a deterrent because the property would gain over 15% quite quickly. Or the foreign invested would send their kid here and enroll them in school to avoid the tax. Many students making zero income are the owners of multimillion dollar mansions. Many people believe it was put in place to make it seem like the government was doing something while knowing that it wouldn’t stop the foreign buyers so the government could continue to collect. Buying took a slight downturn when it was first introduced but bounced right back. There were articles about how real estate agents were helping foreigners avoid the tax.