There’s been a lot of speculation as to how the NDP’s first full budget will impact the lives of British Columbians, especially with regards to real estate. The budget announcement was made today, and the Property Transfer Tax has been amended. I’ll break down what this means for B.C. residents.
Property transfer taxes are incurred when a property changes ownership, and different rates are applied to different portions of the property’s value. Currently, 1% is charged on the first $200,000, 2% is charged on the portion of the fair market value between $200,000 and $2 million, and 3% is charged on the portion of the fair market value greater than $2 million.
The PTT now applies 5% to the portion of the purchase price above $3,000,000. This is in effect starting tomorrow; additionally, the Foreign Buyer Tax will increase to 20% and extend outside of Metro Vancouver to cover more regions within the Lower Mainland.
There is also another affordability measure in the form of a speculation tax on properties owned by individuals not paying Income Tax within British Columbia, and who let the property remain vacant. This will be 0.5% of assessed value in 2018, which will then increase to 2% in 2019 for all areas affected by the Foreign Buyer Tax.
If you’re looking for more information, check out the resources below:
Tax increases and implementations of new rules can affect the decisions you’ll be making in the future. If you’re unclear about what these changes will mean for you, let me know – I am always happy to advise my clients and assist them in achieving their goals.
Image Source: Canadian Mortgage Experts