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First look at impact of foreign home buyers tax one month after being introduced

VANCOUVER (NEWS 1130) – It’s been exactly one month since the provincial government brought in the 15 per cent foreign buyers tax to help cool the market, and we’re getting a better idea of what kind of impact it’s had on home sales.

Local realtor, Steve Saretsky has taken an in-depth look at some of the numbers and he’s found detached home sales are down across the board.

In what, he argues, are the four largest markets — Richmond, Burnaby, Vancouver East and Vancouver West. Richmond appears to have taken the biggest hit, especially when you look at year-over-year for the month of August. Last month, he found, there were 35 sales, while in the previous year there were 183.

Condos, on the other hand, were pretty stable — there were no major increases or decreases.

Given the new tax, Saretsky found prices have dropped off a bit. For example, the median sale price for a home in Richmond in July is said to be $500,450 while last month it went down to $478,000.

The provincial government implemented the tax to single out foreign buyers as a way to calm the real estate market. To give you context, the tax will amount to $300,000 on the sale of a $2 million home.

The tax can be increased and decreased between 10 and 20 per cent. Regional districts outside of Metro Vancouver can also be included if the tax pushes foreign buyers to other areas.

Last month, the premier promised anyone who attempts to cheat the system through loopholes in the legislation will be caught and every transaction will be audited.

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