Residential Market Commentary – Week of June 27th, 2016

THINK OUTSIDE THE BOX:  Ottawa is taking another stab at figuring out how to cool the hottest parts of Canada’s housing market.

Federal Finance Minister Bill Morneau is convening a working group to do a deep dive into Canada’s real estate conundrum.  The group will include members from B.C., Ontario, Toronto and Vancouver.  Their report is due in the fall.

While the finance minister is working up a multi-layered study, the City of Vancouver is working up a punitive Vacancy Tax in an effort to free up some affordable housing.  The report goes to council this week.

The city hopes to get an estimated 10,800 properties that sit empty year-round onto the rental market.  Vancouver’s vacancy rate is nearly zero.  Vancouver wants the B.C. provincial government to introduce a new “residential vacant” property class that could be taxed at a higher rate that an occupied home.

The plan is to target speculators, but there are concerns the new tax could capture homes that are only occupied part-time by the owners, family members or short-term rental guests.

Maria Broekhof      June 27, 2016

 

 

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