It is no secret that here in B.C.’s Lower Mainland (Vancouver to be specific) there is an affordability issue. Not only are home prices seemingly out of reach for the average consumer, the rental rates are extremely high and the vacancy rates are extremely low. Canadian Mortgage Housing Corporation has stated that for the last 4 years Vancouver has had a rental vacancy rate of 1% or less, 0.6% in 2015.
Much has been done to help make housing affordable in Vancouver, most notably the Foreign Buyer Tax imposed by the B.C. Liberal Government in the summer of 2016 aimed at stopping the acceleration of housing prices. In 2017 however, a plan to help with affordability as well as vacancy rates is expected to start. Homeowners in Vancouver will soon be given property status declaration cards in which they will need to declare what their home is being used for.
According to their website, the criteria listed below is what the City of Vancouver will look at when deciding if a home in Vancouver will be subject to this new tax. If your home doesn’t meet any one of the three criteria listed, it may be subject to the following penalties starting in 2017:
Being used as a principal residence by the owner or his/her family member
Rented for a total of 180 days of the year, in periods of at least 30 consecutive days
Meeting the criteria for one of the permissible exemptions listed here
“Empty” homes will be subject to 1% tax of properties value
Late payment penalty of 5%
Daily interest on arrears (owed money)
The tax sale price
False declarations result in fines of $10,000 per day of the continuing offense, in addition to the payment of the tax.