Flipping tax means more homes for families, not speculators
B.C. is taking action to target housing speculation to make sure more people can find an affordable home in the communities where they live and work.
“Buying a home is one of the biggest milestones in people’s lives – whether it is their first apartment or sizing up for a growing family – everyone wants to find a place to call home and build a good life,” said Katrine Conroy, Minister of Finance. “We don’t think families should have to compete against wealthy speculators when they are purchasing a home, which is why we’re taking action against investors who use the housing market as a stock market.”
B.C. is introducing the Residential Property (Short-term Holding) Profit Tax Act, commonly referred to as the B.C. home-flipping tax. The legislation discourages investors from buying housing only to turn a quick profit. Income from residential property resold within two years will be subject to the tax.
“Homes are meant to be lived in by people in our communities, not used for speculation,” said Ravi Kahlon, Minister of Housing. “While some want to allow speculation in the housing market, allowing speculators to make a quick profit – we know that people can’t afford that. We will keep building up supply and take action on the driving forces behind rising prices, including speculation.”
In a year, approximately 4,000 properties are expected to be subject to the tax. All revenue from the tax will go directly into strengthening housing programs and building new homes in B.C.
“We see the Province has been putting policies in place that will make homeownership in multi-family communities affordable,” said Tony Gioventu, executive director, Condominium Homeowners Association of BC. “The tax will slow the speculator frenzy that happens when a flippable property is listed for sale frequently, resulting in unauthorized, unpermitted rushed alterations, leaving communities with a legacy of building failures and conflict. This new tax, partnered with the expanded first-time homebuyers benefit, will help give people the boost they have been needing to be able to purchase their first home and support sustainable communities.”
People who face unavoidable life changes, including divorce, death, illness, relocation for work, job loss or a change in household membership, will be exempt from the tax. Builders will also be eligible for exemptions if they are adding to the housing supply, including building housing on residential property with no existing housing, or adding an additional suite or housing unit to a property that has an existing home.
The tax goes into effect on Jan. 1, 2025, once legislation is passed.
Learn More:
To read more about the B.C. home-flipping tax, visit: https://www2.gov.bc.ca/gov/content/taxes/income-taxes/bc-home-flipping-tax
Read about other recent actions on housing in B.C.:
Speculation and vacancy tax: https://www2.gov.bc.ca/gov/content/taxes/speculation-vacancy-tax/how-tax-works
First Time Home Buyers program: https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/exemptions/first-time-home-buyers
Newly built home exemption: https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/exemptions/newly-built-home-exemption
BC Builds: https://www.bcbuildshomes.ca/
For more information about B.C. legislation, visit: https://strongerbc.gov.bc.ca/Legislation
A backgrounder follows.