Canada’s Foreign Home Buyers Ban extended until 2027
The Foreign Home Buyers Ban, initially announced in 2022 and enacted since January 2023, prohibits non-Canadians and corporations controlled by non-Canadians from acquiring residential property in Canada, with specified exceptions. Originally scheduled to conclude on January 1, 2025, the ban has now been extended to January 1, 2027.
Whistler and Pemberton remain excluded from the Foreign Home Buyers Ban. Both Whistler and Pemberton fall outside the Prohibition on the Purchase of Residential Property by Non-Canadians Act definition of “Residential Property” – which states that the prohibition applies to ‘residential property located in a census metropolitan area or a census agglomeration’.
New BC Government Housing Measures
The BC Government announced new housing measures in the 2024 Budget. On February 22 2024, Finance Minister Katrine Conroy introduced the provincial governments Budget of 2024. The budget introduced several new housing related measures, including the BC Home Flipping Tax and various property transfer tax exemptions.
BC Home Flipping Tax
The proposed British Columbia home flipping tax would be applicable to the income generated from the sale of properties in the province if the ownership duration is less than 2 years.
The tax, which is subject to legislative approval, is separate and distinct from the federal property flipping rules and is not harmonized or administered with the federal or B.C. income tax.
According to the official government website of BC, the tax rate will be highest for those who owned properties for the shortest period and will decline the longer the property is owned. The tax rate will be 20 percent for income earned from properties sold within 365 days of purchase and will decline to zero between 366 and 730 days. You may be exempt from paying tax on income earned from the sale of your property if you are eligible for an exemption.
Your income of the sale of your property will be subject to this tax if you sell your property on or after January 1 2025, and if the property was purchased less than 2 years prior to the sale. Please visit the official government website of BC for more information and get advice from a professional tax advisor.
New First Time Home Buyers Property Transfer Tax exemption
The BC First Time Home Buyers program reduces or eliminates the amount of property transfer tax that is payable when purchasing the first home. If a new home buyer qualifies for the program, they may be eligible for either a full or partial exemption from the property transfer tax. As of April 1 2024, homes with a fair market value of $835,000 or less may qualify for a full exemption. Meaning if all requirements are met, the purchaser may be exempt rom the property transfer tax on the first $500,000 of the purchase price. Before April 1 2024, the threshold is $500,000 or less.
To qualify for a partial property tax exemption, the property has a fair market value more than $835,000 but less than $860,000 as of April 1st. If the home id purchased before April 1, 2024, to receive a partial exemption, the fair market value must be more than $500,000 and less than $525,000.
Please click here to see all the requirements that must be met, to learn more about the first time home buyers program and to find out if you may be eligible.