Yvr2zrh shared this comment:
Wow. Quite a lot of negatives for real estate values.
1.) If you live outside Vancouver and keep an apartment empty there, you now have a very punitive tax. Total will be 3% by 2019 (only 0.5% provincial in 2018 as a bit of a leeway to allow people to sell).
2.) FBT @20% – pretty good. Big tax – starts immediately. Wow . More people will get caught again. Deals will die. Also if property is over $3M – this will make it 25% for a foreigner to buy a Van West house. Then they have to pay 3% per year ($90K?) to leave it empty. Game over.
3.) The 2% spec tax – Strange name – it’s more of an absentee owner / empty home tax. It’s pretty sizeable. It’s going to be strange but somehow I think they are going to force it onto certain “principal residences” i.e. students, 10-Year visa people – who don’t qualify for really being a resident. Then – if they really pay tax in BC there is a tax credit. Good system.
4.) Full reporting of pre-sale transactions for tax purposes. I suppose that may help but you need to require a tax withholding for non-residents because otherwise – they just won’t pay.
5.) Unveiling all the hidden ownership – starting with collecting on new transactions and forcing existing transactions to be unveiled.
So – I would say that “Housing for Housing” has been supported and properties for non-residents etc – – that will be tough. What about all the Okanagan properties owned by Albertans – – It’s going to be interesting to see how many people bail!!!
You know Vancouver is hot, but did you know that house prove gains in the Fraser valley are outpacing Vancouver? Southseacompany points out this CBC article with the details.
“The Canadian Mortgage and Housing Corporation says demand for less expensive condominiums and apartments in North Delta, Surrey and Langley has inflated prices at a sharper rate than in Vancouver.”
“”Those municipalities have some of the most affordable units in the region, particularly for condos,” he (Eric Bond, a regional analyst with CMHC) said. “For first-time buyers, given the price increases we’ve seen in the rest of the region, often those units are what’s most interesting to them.”
Read the full article here.
Most economist are predicting a slower housing market in Canada, but how slow is too slow?
Southseacompany points to this article wondering how ‘sharp’ any correction would be:
Last week, the Bank of Canada hiked the overnight rate to 1.25 per cent, causing the credit union to note that Canadians have some of the highest levels of household debt in the world.
The interest rate hike — when combined with a new mortgage stress test for uninsured borrowers that came into effect on January 1 — could severely limit the purchasing power of many would-be home buyers, cooling the market dramatically.
But while most economists agree that these factors will dampen the market in the first few months of 2018, many believe it will eventually adjust to the changes. What’s more, some argue that Canadians debt levels aren’t as worrying as they might first appear.
“Household debt in Canada is seen by some as unsustainably high and a source of vulnerability for the financial system,” write National Bank chief economist Stéfane Marion and senior economist Matthieu Arseneau in a recent report. “But the international evidence suggests that Canadian household leverage and home prices are not abnormal.”
Read the full article here.
Bear Vancouverite pointed out this debate on CKNW:
I wanted to share this with you guys: a debate between Tom Davidoff and architect Michael Geller. Davidoff is a UBC economics professor in the Sauder School of Business which some here have (wrongly) accused of being in the RE Industry’s pocket. In this debate Davidoff’s position is that:
1) The rich who own huge homes are being subsidized by the rest of us
2) We should get rid of the Home Owner’s Grant (Michael Geller brings this up too)
3) We should encourage more density in super low density areas like Point Grey
4) We should not gentrify low income areas to increase density if we can increase density in wealthy areas
5) We need to curb demand using tax policy ( Speculator’s Tax)
6) Housing needs to be in line with local incomes
I’ve seen other interviews with Davidoff in the past and I believe he considers our housing overpriced, manipulated by wealth and speculation, and would like to see prices more in line with local incomes.
The one aspect that he believes that I think have offended some people here is he believes “everyone wants to live here”.
A growing issue in Vancouver real estate is that of foreign buyers. Statistics Canada claims that non-resident foreigners own 7.6% of the value of homes within the city of Vancouver.
Now clearly it is possible to talk about this issue without devolving into racist generalizations and hate, but some commenters on this site have a very difficult time doing so.
There are a number of parties that have no interest in changes to the current market and these parties are served best by angry racist rantings. What better way to distract from the issue at hand and paint any discussion of foreign buyers as racist?
So good job you knuckle-heads, those that profit in a run-away housing bubble thank you!