Seven months after B.C. introduced a tax on foreign buyers in Metro Vancouver, their interest in the region’s real estate market seems to be levelling off.
Last month, foreign nationals accounted for about $93 million in residential sales in the region, or a little more than three per cent of both the value and number of all transactions, according to the most recent property transfer tax data. That’s well below the 16.5-per-cent value of all transactions recorded just before the regional tax came into force in August.
But it’s still much higher than during the first month of the tax, when that percentage dipped below one per cent. The latest numbers suggest that activity involving foreign nationals rebounded slightly after the initial plunge, but has remained relatively static since October, clocking in every month since at between three and four per cent of the total value and number of sales in Metro.
The hottest market for non-Canadian buyers seems to be Richmond, where they accounted for 8.5 per cent of the total value of transactions in February and 11.8 per cent the month before.
There’s still less than a year of available data on the impact of the tax, and overall sales activity has fallen across B.C. since the summer busy season, so direct comparisons are difficult to make. Still, the Vancouver region is starting to account for a much smaller portion of transactions involving foreign nationals across the province.
In June and July of last year, 78.4 per cent of B.C.’s residential transactions involving foreign buyers were made in Metro. Following an abrupt drop-off in activity in August, that percentage has settled in at about half of all sales for the last four months.
What remains to be seen is how recent exemptions to the 15-per-cent, foreign-buyer tax will impact B.C.’s housing market. Last week, the provincial government announced that the tax will no longer apply to skilled workers here under the provincial nominee program and foreign nationals who obtain permanent Canadian residency within a year of buying a home.
The changes to the program are retroactive to August, and anyone who qualifies can apply for a rebate. The province estimates that will cut revenue by $1 million to $3 million for the first year of the tax.
-With files from Derrick Penner
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