New Foreign Buyers Tax

Effective August 2nd, foreigners who buy residential property in the Vancouver area will have to pay an extra 15-per-cent tax as part of a B.C. government plan to slow the foreign speculation that many blame for making the region’s homes the most unaffordable in Canada. Premier Christy Clark announced that “I want to keep home ownership within the grasp of the middle class in British Columbia.”  In my opinion, middle class detached home ownership , especially on the North Shore, is a ship that sailed many years ago. You cannot purchase a livable home in West Vancouver for under $1.5 million. North Vancouver is slightly more affordable at approximately $1.1 million. Both of these homes would need significant renovations. The purchase of a $1.5 million dollar home would require a down payment of approximately $375,000 and would leave Mr & Mrs “middle class” with a monthly mortgage payment of approximately $6,000/month not including property tax. Clearly not an option for households earning under $200,000/year. In my opinion, this tax may have a slight, short-term impact on prices and number of foreign buyers  but it will not make the North Shore more affordable for Canadians.