Eby’s home flipping tax passes despite failed BCU attempt to add loophole
Late yesterday, David Eby’s house flipping tax passed the legislature, despite an attempt by Kevin Falcon’s BCU Party to weaken the legislation.
Right now, families who are trying to buy their first home are forced to compete against investors and speculators who are only interested in flipping the property, which drives up the cost for everyone. The flipping tax discourages investors from buying housing only to turn a quick profit. Under the new measure, any profit made from selling a property within two years will be subject to the tax.
BCU Finance Critic Peter Milobar proposed an amendment that would have weakened the bill and allowed speculators to avoid the tax by living in a home for a year, flipping it, and then buying a new home. Finance Minister Katrine Conroy responded to Milobar’s proposal during debate:
“We can’t accept the amendment as proposed, as the reason we have the 365-day rule is so people can’t live in the house for a year. This is speculators who could live in the house for a year and a day and then sell it, and keep doing that. The whole rationale behind this bill is for speculators. What the member is proposing does create a massive loophole for speculators to keep doing that: live in a house for a year and a day, sell it and buy another house. That’s what is creating the problem in the province, where speculators are raising the prices. I mean, you go to any community, and that’s what we’re trying to stop.”
The amendment was defeated by BC NDP MLAs.
“Once again, Kevin Falcon is trying to stand in the way of David Eby’s action to make housing more affordable,” said BC NDP MLA Ravi Parmar. “Both Falcon and John Rustad are against the Speculation Tax, the ban on standalone Airbnbs, and our action to reduce barriers to housing construction. It’s clear that they would invite speculators back into the housing market and drive housing costs even higher.”
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.