The City of Vancouver is implementing an Empty Homes Tax due to a lack of rental properties available. Properties deemed vacant will be subject to a tax of 1% of the property’s assessed taxable value.
Mayor Gregor Robertson said,“Vancouver renters are in crisis, with the rental vacancy rate hovering over zero for years. The city will not sit on the sidelines as more than 25,000 empty and under-occupied properties hold back homes for people who live and work in Vancouver. We need a tax on empty homes to encourage the best use of all our housing, and help boost our rental supply for locals.”
Consequently, it will now be mandatory for each Vancouver homeowner in the city to submit a declaration of their annual property status – determining if their property will be subjected to the empty homes tax policy by February 2, 2018.
Most properties will not be subject to the Empty Homes Tax, including those:
- Used as a principal residence by the owner, his/her family member, or a friend for at least six months of the current year
- Rented for at least six months of the current year, in periods of 30 or more consecutive days
- Meeting the criteria for one of the exemptions https://rem.ax/2B0AbH4 .
Nonetheless, upon failure of submission or meeting any of the exemption criteria, your property will be reckoned as vacant and will be subject to the one percent tax rate based on the 2017 assessed taxable value of the property. This is sure to impact the vacancy of homes as based on the assessed value of an average home in Vancouver now to be $1 million the tax subjection would cost owners at least $10,000.
In addition to this, the homeowner will also be charged with a $250 penalty for not adhering to the declaration requirements.
As Real Estate Investors, we’re sure your Vancouver home will be full of tenants at all times, but we just thought we would give you this interesting update. Happy Landlording!