BC set for major crackdown on Vancouver property market
Global & Mail:
For 2020, he says we should expect to see those policies put to use to flush out buyers that have been failing to declare global income, as well as speculators who’ve been dodging their fair share of capital gains tax. Speculative buying in recent years has driven up prices for local income-earners and shut them out of the market.
But the new collection of income tax data and identification of property ownership allows government to cross-reference with Canada Revenue Agency, Mr. Kurland says. The data, combined with recent changes to Quebec’s Immigrant Investor Program (QIIP), will have the effect of softening Vancouver’s high-end property market even further, the Vancouver-based lawyer says.
He adds that we shouldn’t expect another wave of buyers from Hong Kong who might be seeking refuge from current conflicts with Beijing.
Mr. Kurland says that people holding high-end properties who haven’t been transparent about worldwide income may choose to unload those properties instead of face an audit, bringing more supply onto the market.
“That’s how you get these multi-million dollar homes that are barely occupied,” he says. “Under the old way, if you had six of them, you declare each one as your personal residence. For each one you say, ‘I’m resident here for income tax purposes and I don’t have to pay capital gains,’ when in fact, none of the above is true. They are not income tax residents, so they [are not allowed] a capital gains exemption and it’s not their principal residence. But no one checked. It was an honour system. But no longer.
“So the multiple property holds are now all subject to this new game. Their choice now is, ‘How do I unravel my holdings without taking a bath?'”