Canada’s most-expensive property market, Vancouver, British Columbia, suffering from a near-zero supply of rental homes, announced the details of a new tax aimed at prodding absentee landlords into making their properties available for lease. The empty-home tax will take effect by January 1, 2017 and will be calculated at 1% of the property’s assessed value, Vancouver Mayor Gregor Robertson told reporters at City Hall.
The tax will apply to homes or residential land that sit empty for six or more full months in a year. The onus is on property owners to declare, on their property taxes, their primary residence, whether they are renting out the property or meet one of the other exemptions, otherwise, the tax will apply by default.
Property owners who fail to declare their property’s status will be charged the tax while failure to pay will tack on an extra 5% late penalty. Making a false declaration will result in a $10,000 fine – per day!
Public scrutiny has focused on absentee landlords, particularly from overseas, who are accused of sitting on investment properties where windows remain dark throughout the year.
Citing data from BC Hydro, Robertson estimates that there are around 20,000 empty or under-utilized properties in the Vancouver area.