A few months ago, the B.C government announced that it would implement a 15 per cent property transfer tax for foreign buyers. The tax was levied to stabilise the then overheated real estate market in Metro Vancouver. This has disheartened the foreign homebuyers in Vancouver.
Gone are the dark clouds that had made foreign homebuyers’ time tougher into the real estate market. The present state of affairs in Metro Vancouver is spreading brightness in the lives of foreign homebuyers with work permits.
So, what exactly happened? B.C’s Premier Christy Clark recently announced that the 15 per cent foreign homebuyer tax would no more be valid to the people with work permits residing in Vancouver.
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Christy Clark made the announcement about tax exemptions to foreign buyers while reacting to the US President Donald Trump’s recent instated Muslim travel bans at the Chinese Lunar New Year Parade.
She stated, "We believe the people who are seeking refuge around the world should be able to find a safe haven here in British Columbia. We believe the best and the brightest should be able to come to British Columbia. We’re going to lift the foreign owner’s tax on people who have work permits, who are paying taxes and living in British Columbia as a way to encourage more people to come."
Clark further added that the government would fight to ensure that individuals who are dual citizens, Canadian holding a passport from Iran or Iraq or Syria can continue to travel. According to Clark, those are the values Canadians and British Columbians hold. "I will say this: here we are in a celebration of diversity today, we should be very proud to be Canadians on a day like this."
NDP Housing Critic David Eby believes that foreign buyers with work permits should have never been subject to the 15 per cent tax in the first place.
According to UBC professor and economist, Tom Davidoff, this new fix by the province to liberate the work permit holders from their foreign homebuyer taxes is a ‘good move’ and ‘mostly sensible’. He specified that along with this, the government should also contemplate regarding the probable loopholes surrounding the tax, for example, the kind of work permit one holds.
He said that the timing of the tax announcement was an opportunistic move and is going to be beneficial for the Vancouver’s tech industry. Davidoff stated, "We've got an opportunity here in Vancouver to become a real tech hub, to become a real intellectual, vibrant, healthy economy." "Being tolerant and open to diversity and an international workforce is a good step in that direction," he said.
Since the foreign buyer tax was imposed, it contributed to the decreasing residential housing sales and a fall in prices. With the lift in tax for people with work permits, it is being predicted that there will be a potential house pricing surge as more buyers will be joining the market.