B.C.’s government has said it will go ahead with allowing property taxes on homes left vacant.
The new tax is one that has been pushed for by Vancouver mayor Gregor Robertson.
The purpose of the tax, according to the government, is to address the housing crisis increasingly affecting Vancouver and cities nearby for approximately 100 kilometers — house prices and availability have been dramatically effected as far east as Chilliwack.
The tax could come into effect some time in 2017 at the earliest.
However, critics are already saying the tax does nothing to deal with the problem. They say that a small property tax will most likely not dissuade buyers in a market where prices are dramatically higher each year, and where many houses are purchased as investments from overseas — most notably, China, where an abundance of wealthy people are seeking investments outside of their nation, and many buyers do not even see the homes they buy.
Currently, property tax is relatively inexpensive in Vancouver compared to other popular North American and world cities. For example, a 2-bedroom unit in Yaletown or Coal Harbor which costs around $1 million has a property tax of around $2500 per year. In many American cities, the property tax would be 3 or 4 to 10 times that amount depending on the city. One reason for Vancouver’s low property tax rate is that the provincial government imposes a high income tax rate, which isn’t the case in the states.
Maintenance fees are also lower in Vancouver. This is particularly beneficial to buyers who resell their house, because they don’t need to invest as much in upkeep.
In Vancouver, an estimated 1 percent of family homes are unoccupied. 7.2 percent of condos and rental apartments are unoccupied. The highest rate is 12.5 percent, for condos alone.
These figures are roughly the same as other Canadian cities.
The lowest metropolitan apartment vacancy rate in Canada is Quebec with 5 percent and the highest is Windsor with 16.5 percent, although London and Victoria also have high vacancy rates.