If you're a BC resident buying a property in Metro Vancouver, you'll be bracing yourself for not only high purchase prices but also for paying thousands of dollars in Property Transfer Tax. But this will all change if BC's Chambers of Commerce have their way.
In a recently passed policy, the chambers are calling on the BC government to lower the Property Transfer Tax (PTT) for BC residents and increase it for foreign purchasers, to make it easier for locals to buy property in their own cities and communities.
The chambers are also calling for oversight of local governments' use of community amenity contributions (CACs).
"Affordable housing is an important part of a strong economy but a continuing challenge in BC, particularly in some regions," said John Winter, president and CEO of the BC Chamber of Commerce.
"Our policies would boost affordability in two ways: through additional tax relief for local home buyers and by reigning in the abuse of community amenity contributions, which drives up housing costs."
The first of the policies, Property Transfer Tax Reform: Affordable Housing is Good for the Economy, calls on the provincial government to:
- amend the current PTT to provide for a new Primary Residence Grant, which would provide some relief for local purchasers of a primary residence in B.C.;
- continue to increase the threshold for the First Time Home Buyers exemption (see video below); and
- offset the reduction in government revenues from the above by introducing a new PTT rate of a minimum of 2% of the property purchase price for all property in BC bought by non-residents of Canada or corporations controlled by non-residents.
"B.C.'s Chambers of Commerce are proposing some additional tax relief for B.C.'s home buyers, while offsetting this lost revenue by raising the Property Transfer Tax for non-residents of Canada," Winter said.
"This approach is similar to what's been done in other real estate investment jurisdictions such as Paris, New York and Hong Kong." The second of the policies, Removing Uncertainty from Community Amenity Contributions (CACs), calls on the provincial government to:
- introduce a robust ongoing monitoring program to ensure that its Community Amenity Contributions: Balancing Community Planning, Public Benefits and Housing Affordability guide which stipulates, among other things, that CACs be modest is being followed; and
- to the extent that non-compliance is identified, create legislation on CACs to ensure compliance and minimal effect on affordability/viability of redevelopment sites.
"In BC, some local governments are using CACs with impunity; this has to stop," Winter said. "The abuse of CACs not only drives up housing prices, but also undercuts BC's development industry a significant provider of BC jobs through untenable costs and red tape."