Vancouver real estate prices have soared 23 percent in the past year. Now, the Canadian city is trying to cool the overheating housing market by splashing cold water on foreigners dreaming of buying local homes.
As of Tuesday, such buyers were assessed a 15 percent property-transfer tax on their purchase of a home in 22 communities in metro Vancouver. British Columbia’s new law applies to all foreign buyers, even those already under contract.
Critics say foreign speculation is a major contributor to a price boom that has made Vancouver the least affordable housing market in Canada, according to a report in The Globe and Mail, a Toronto-based newspaper.
The Globe and Mail notes that a review of residential real estate transactions in Vancouver’s province, British Columbia, over four weeks in June and July revealed that foreign buyers had snapped up more than $1 billion in property during the time period.
The new tax will be especially costly given Vancouver’s already inflated real estate prices, The Globe and Mail reports:
The change to the province’s property transfer tax…means an extra $300,000 in taxes for people from abroad buying a home for $2-million. Detached houses in the area typically run around that or higher.
So if the thought of either a Donald Trump or Hillary Clinton presidency has you considering a move to the Great White North, you may want to avoid the British Columbia city that regularly is cited as one of the most beautiful places to live in the world.
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