December 13, 2017

New Possibility: Empty Home Tax

Interesting developments are happening in the Vancouver market.  Toronto seems to be mirroring our western neighbour on foreign buyers tax, so it makes you wonder if the same penalties will be coming our way.  One report states that there are 99,236 properties in Toronto that are not regularly occupied.

Another report, states there are 15-28,000 Toronto homes that are sitting empty. They arrived at this figure based on addresses where electricity and water hadn’t been used in a year.  We have a huge rental shortage here, as does Vancouver.

Vancouver has  a rental vacancy rate hovering at zero and Vancouver renters are in crisis.  That’s a lot of rental housing that could be made available, so owners of residential properties in Vancouver will now have to complete an empty home tax declaration by February 2, 2018.

Penalties for non-filing include an assumption that their property is vacant which means a tax of 1% of its 2017 assessed taxable value; plus a $250 fine for non-declaration.

The tax does not apply to principal residences, properties rented for at least 6 months of the year in periods of 30 or more consecutive days or the following exemptions:  occupancy for full-time work (min. 180 days in the year); estate of deceased; transfer of property; undergoing redevelopment or major renovations; strata rental restriction; court order.

“Housing is for homes first, and as business and investments second – we need a tax on empty homes to encourage the best use of all our housing, and help boost our rental supply for locals,” added Vancouver Mayor Robertson.

I know a client here in Oakville that has 5 unoccupied homes in close proximity to her home and it is very unsettling for many reasons.  Personally, I hope we do institute this new tax as there are just too many reasons why a house should not sit empty and you have to wonder how people can get insurance for fire and theft on their homes when there is no one living there?  Very curious!!

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Oakville, Mississauga, Burlington and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406

http://www.mortgagebrokernews.ca/market-update/empty-home-tax-info-mailed-to-vancouver-homeowners-233964.aspx
http://www.metronews.ca/news/toronto/2017/06/12/in-housing-crunch-15000-to-28000-toronto-are-empty.html