B.C.’s speculation tax is expanding to 13 new communities.
Vernon, Coldstream, Penticton, Summerland, Lake Country, Peachland, Kamloops, Salmon Arm, Courtney, Comox, Cumberland, Parksville, and Qualicum Beach will all be added to the tax on second and vacation homes.
Buy/sell, rent/lease residential &
commercials real estate properties.
Introduced in 2018, it already applies to Kelowna, West Kelowna, Metro Vancouver, the Fraser Valley, Victoria and Nanaimo.
It was widely opposed by mayors of tourist market destinations upon its implementation.
The 0.5% tax on the assessed value of second homes that are not rented (2% for non-residents of Canada) was seen as a tool to cool B.C.’s overheated real estate market and now is being touted as a way to “turn more empty units into homes for people,” the province announced Wednesday.
“There is a housing crisis across the country and it is creating economic challenges, including people feeling pushed out of their communities and labour shortages,” said Minister of Finance Katrine Conroy.
“With so many people struggling to find secure housing, we have to keep taking action – we can’t afford to pull back. The speculation tax is one of the ways we can help increase affordable housing options for people and communities.”
“There’s something wrong when people are buying up investment homes and keeping them empty while others are living in vehicles and can’t find housing,” said Minister of Housing Ravi Kahlon.
“Homes are meant to be lived in by people in our communities, not used for speculation. While some would cancel the speculation tax – giving a handout to speculators and turning homes back into empty condos – we know that people can’t afford that. We’re taking action to make more homes available for people throughout the province.”
An independent review in 2022 found the tax freed up 20,000 homes in Metro Vancouver alone.
Homeowners in the added communities will need to declare for the first time in January 2025, based on how they used their property in 2024.
Primary residences, those with a long-term tenant are exempt, and life events, such as separation or divorce can also exempt a property.
Lake Country Mayor Blair Ireland responded: “The expansion of the speculation and vacancy tax does not come as a surprise to us … It has always made sense to align major policy throughout communities of the Central Okanagan and, as such, we are now in line with the City of Kelowna. This decision provides a cohesive message to all Central Okanagan builders and buyers and less confusion for taxpayers.”
The speculation and vacancy tax will now apply to a total of 59 communities.
Since 2018, the province says it raised more than $313 million to go back into affordable housing in districts where the tax is applied.
Castanet is reaching out to local mayors for reaction to the tax expansion.