Provincial tax could push more buyers to Island: realtor

A 15 per cent tax imposed on foreign investors in Vancouver could create more interest in Victoria's housing market.

A 15 per cent tax imposed on foreign investors in Vancouver could create more interest in Victoria’s housing market, says one local real estate agent.

Earlier this week, the provincial government announced it will be imposing a new 15 per cent tax on property purchased in metro Vancouver by non-Canadian citizens or residents, in an attempt to deal with the spiralling costs of real estate in the city.

The tax, which is expected to take effect Aug. 2, will not extend to municipalities outside metro Vancouver, such as Victoria, and will be used to support affordable housing and rental assistance initiatives.

New data released by the provincial government said foreigners bought 9.7 per cent of homes between June 10 to July 14 in Vancouver (representing $885 million worth of residential real estate), significantly higher than the earlier tally of 5.1 per cent issued by the province a few weeks ago.

Tony Joe, a realtor in Victoria and the president of the Asian Real Estate Association of America’s Vancouver chapter, said in the short-term the tax will generate interest in Victoria’s already hot housing market.

“A lot of investors who have been thinking about Vancouver have also considered Victoria as well. I think it’s possible that it might tip the scales and have them be a little more interested in Victoria than in Vancouver,” said Joe, who specializes in foreign investors. “The overall thought is all of a sudden Victoria looks like a 15 per cent better deal.”

While the tax is meant to discourage foreign investors, Joe believes many who have their heart set on Vancouver will simply pay the tax. However, there will be some who won’t want to pay, which could result in them moving to other areas of the province, including Vancouver Island, other areas of the Lower Mainland and the Okanagan.

According to Joe, Victoria used to be seen as a quiet town compared to other larger cities. However, that view is quickly changing and more foreign investors are seeing Victoria as a city where their children can be fully immersed in Canadian culture.

“One of the major appeals of Victoria, especially regarding their kids, is that they’re sending their kids here and they’re getting much more of a total language immersion because when they’re in Vancouver, the kids literally don’t need to speak much English because their surroundings and social networks remain very Chinese,” said Joe, adding many of his clients are newcomers — some of whom have lived in Vancouver for two to seven years and have decided to sell their home and move to Victoria, or are purchasing a second property for their children.

“They come over here, Victoria remains very Anglo. To many of the Chinese, when they think of North America, they feel Victoria is more North American than Vancouver.”

Joe believes if the tax does help slow down the real estate market in Vancouver, sellers looking to cash in on their homes and move to other areas will be left in the dust — an affect that could trickle down to Victoria.

In the long-term, Joe is also concerned that foreign investors who do decide to pay the tax and want to sell their place 10 or 15 year down the road will look to recoup all of the costs, including the tax, which will drive the value of the property up as well.

 

 

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

The Capital Regional District is considering adding another dollar a year to the parkland acquisition fund fee for homeowners. (Black Press Media file photo)
One dollar or two? Greater Victoria parks acquisition fee hike spurs debate

$2 a year too steep, CRD committee recommends $1 a year increase per household

Vancouver Island-based Wilson’s Transportation has expanded to fill some of the routes left unserviced by Greyhound as of Nov. 1, 2018. (Black Press files)
B.C. bus companies say they need help to survive COVID-19

Like airlines, motor coaches have lost most of their revenue

Patrol officers from VicPD’s Esquimalt division responded to a call about hateful graffiti in Macaulay Park Wednesday evening. (Black Press Media file photo)
Anti-Semitic, hate-based graffiti found in Esquimalt park

Police seek suspects after fresh hate-based graffiti found Wednesday evening

Alyssa Gerwing, executive director of the Sidney Museum and Archives, gets into the Halloween spirit with a lit-up jack-o-lantern. With Treat Street cancelled, the Sidney Business Improvement Area Society has organized a series of other events and activities under the heading of Halloween Spooktacular. (Wolfgang Depner/News Staff)
Sidney serves up ghoulish spills and thrills during Halloween

A virtual Halloween treasure hunt and scary drive-in movies among tricks and treats

Artists, activists and supporters stand at the ‘More Justice, More Peace’ mural in Victoria’s Bastion Square after the letter ‘S’ was painted over in black. (Nina Grossman/News Staff)
ACAB removed from Victoria’s More Justice, More Peace mural

New message points to VicPD, City of Victoria for silencing BIPOC voices

A woman wears a face mask and plastic gloves while browsing books as a sticker on the floor indicates a one-way direction of travel between shelves of books at the Vancouver Public Library’s central branch, after it and four other branches reopened with limited services, in Vancouver, on Tuesday, July 14, 2020. (THE CANADIAN PRESS/Darryl Dyck)
B.C. reports 234 new COVID cases, 1 death of senior who had attended small birthday party

Roughly 5,700 people are isolating due to being exposed to a confirmed case

MNP senior economist Susan Mowbray presents the State of the Island Economic Report on Thursday night to conclude the Vancouver Island Economic Alliance’s virtual summit. (VIEA image)
Not-so-rosy State of the Island report caps off virtual summit

Vancouver Island Economic Alliance’s summit took place online Oct. 27-29

President Donald Trump speaks at a campaign rally in Allentown, Pa. on Oct. 26. (AP Photo/Alex Brandon)
POLL: How closely are you following the U.S. presidential election?

It may feel like it’s been going on forever but the U.S.… Continue reading

Burnaby RCMP responded to a dine-and-dash suspect who fell through a ceiling in March 2020. (RCMP handout)
VIDEO: Suspected dine-and-dasher falls through ceiling of Burnaby restaurant

A woman believed to be dashing on her restaurant bill fell through the kitchen ceiling

A can of Canada Dry Ginger Ale is shown in Toronto on Thursday Oct. 29, 2020. The maker of Canada Dry Ginger Ale has agreed to pay over $200,000 to settle a class-action lawsuit launched by a B.C. man who alleged he was misled by marketing suggesting the soda had medicinal benefits. THE CANADIAN PRESS/Joseph O’Connal
B.C. man’s lawsuit over marketing of Canada Dry ginger ale settled for $200K

Soda’s maker, Canada Dry Mott’s Inc., denied the allegations and any liability

A deer was spotted in October 2020 in Prince Rupert, B.C., with a bright pink yoga ball stuck in its antlers. (Kayla Vickers/Chronicles Of Hammy The Deer Official Page)
Hammy 2.0? Prince Rupert deer spotted with bright pink yoga ball stuck in antlers

The BC Conservation Officer Service is aware of the deer roaming around the city

RCMP. (Phil McLachlan - Black Press Media)
Kelowna Mountie hit with 2nd lawsuit in 2 months for alleged assault

Const. Julius Prommer is accused of breaking a woman’s knee during while responding to a noise complaint

Hirdeypal Batth, 24, has been charged with sexual assault and forcible confinement in relation to an incident in August 2020. (VPD handout)
Man, 24, charged with sex assault after allegedly posing as Uber driver in Vancouver

Investigators believe there could be more victims outside of the Vancouver area

Pilot Kevin Maher participated in a flyover of a ceremony at the Cobble Hill cenotaph on Oct. 22 in a 1940 North American (Noorduyn) Harvard aircraft. (Robert Barron/Citizen)
Cobble Hill remembers lost military members with ceremony, flyover

Annual event commemorates those who died in non-combat roles

Most Read