In an effort to reduce foreign investment and boost local sales in Vancouver’s “feverish housing market”, the Real Estate Board of Greater Vancouver has imposed a 15% property-transfer tax on real estate buyers who are not Canadian citizens or residents, according to The Wall Street Journal’s Leigh Kamping-Carder.
Since the foreign-buyer tax took effect on August 2nd, Vancouver’s luxury sales have plunged by 57.5%, and overall home sales in greater Vancouver have fallen 30.2%. Only 62 homes in the priciest 5% of Vancouver’s housing market, priced at $3 million CAD ($2.27 million USD) or above, sold in September. Luxury home prices are largely unchanged.
Because the move was announced only a week before it took effect, and covered existing contracts, buyers with signed deals scrambled to close, said Brad Henderson, president and CEO of Vancouver-based Sotheby’s International Realty Canada. About 10.9% of all metro Vancouver sales between June 10 and Aug. 1 were registered on July 29, including 39.4% of the deals involving foreign nationals during that period, according to provincial data.