The release of BC’s Budget 2024 last week included several benefits for families and businesses.
It also included a new home flipping tax that is expected to come into effect on Jan. 1, 2025.
The proposed tax, which will be introduced to legislation this spring, would see any home sold within two years of purchase taxed with the revenue funding new homes.
The province says homes sold within the first year will face a tax rate of 20% of the profit, declining to zero over the next 365 days.
A release states that an estimated 7% of residential houses sales were sold within two years between 2020 and 2022.
Premier David Eby says the tax will help families avoid competing with house-flipping investors when they’re trying to purchase a home.
“This tax will deter speculators and give families looking for a place to live an advantage in our housing market,” Eby said.
There will be exemptions to the new proposed tax, however.
People will be exempt if they face “unavoidable life changes” like death, divorce, job relocation or loss.
The province says people who are adding to BC’s housing supply will also be exempt.
Katrine Conroy, minister of finance, says the NDP government knows people are struggling and that is why they introduced more housing benefits in Budget 2024.
“We know that people are struggling to find homes to rent or buy in areas that are close to work and their families,” said Conroy.
“We want people to know our government has your back.”
A release issued by the province Monday morning says the flipping tax complements other measures like the speculation and vacancy taxes, which were introduced in 2018.
The new tax would also complement a round of housing-focused legislation introduced in the fall, including the limitations to short-term rentals in the province where vacancy rates are low.
In addition, starting April 1, 2024, people may be eligible for the First Time Home Buyers Program for homes value dup to $835,000, paying no property tax on the first $500,000.
The province says a Newly Built Home Exemption is also starting April 1, 2024, which means property transfer tax will be waived on new homes worth up to $1.1 million, an increase from the previous $750,000 price limit, to encourage new home building.
