Data reveals 15% tax on foreign buyers is effective

Percentage of Metro Vancouver home sales involving foreigners plunged in August

The percentage of Metro Vancouver home sales that involved foreign buyers plunged in August, following the provincial government levying a 15 per cent property transfer tax on transactions that involve foreign buyers in the region, according to data that the provincial government released September 22.

Home sales in the region that involved foreign buyers plunged to 0.9 per cent between August 2 and August 31, from 13.2 per cent between June 10 and August 1, according to provincial government data.

article continues below

The government first started tracking foreign home buyers on June 10 and the new 15 per cent tax went into effect on August 2.

A massive amount of transactions took place on July 29, which was the last business day that home sales to foreigners could be registered before the additional property transfer tax took effect.

Government data shows that 55 per cent of all transactions registered in Metro Vancouver on July 29 were to foreign buyers. The more than $850 million in residential property transactions that involved foreign buyers and was processed on that day is also equal to almost 40 per cent of the total foreign investment in Metro Vancouver residential real estate for the period between June 10 and August 1.

After the tax was implemented, between August 2 and August 31, there were a mere 60 transactions in Metro Vancouver that involved foreign nationals.

The total value of the properties transferred was $46.9 million, which is less than 1 per cent of all Metro Vancouver transactions during that period. These transactions raised approximately $2.5 million in additional property transfer tax revenue, according to government data.

Some of these transactions included both foreign purchasers and a Canadian citizen or permanent resident on title, with the additional tax only applying on the portion of the value claimed by the foreign buyer.

Overall, in Metro Vancouver, there were 2,034 transactions, worth $2.3 billion, that involved foreign buyers between June 10 and August 31. That represents about 9.3 per cent of the nearly 22,000 transactions that took place during that period. It also represents 11.5 per cent of the $20.6 billion that changed hands during that period.

gkorstrom@biv.com

@GlenKorstrom

Read Related Topics

Comments

NOTE: To post a comment you must have an account with at least one of the following services: Disqus, Facebook, Twitter, Google+ You may then login using your account credentials for that service. If you do not already have an account you may register a new profile with Disqus by first clicking the "Post as" button and then the link: "Don't have one? Register a new profile".

The Vancouver Courier welcomes your opinions and comments. We do not allow personal attacks, offensive language or unsubstantiated allegations. We reserve the right to edit comments for length, style, legality and taste and reproduce them in print, electronic or otherwise. For further information, please contact the editor or publisher, or see our Terms and Conditions.

comments powered by Disqus

Popular Vancouver Courier

Sign Up For Our e-Newsletter!
Find the Vancouver Courier Newspaper