The B.C. government has raised the threshold to qualify for the full home owner grant to shield some owners from a higher property tax bill.
The jump in assessed values this year would have left owner-occupied homes that have climbed above $1.1 million – the old threshold – with less than the basic $570 home owner grant offsetting taxes.
The revised threshold is $1.2 million and homes above that lose $5 of the grant for every $1,000 in additional value.
That means the grant now disappears altogether for homes worth more than $1.314 million.
The province reduced the threshold in 2014 from a previous $1.295 million in order to skim $11 million from home owner grants to general revenue and it was kept frozen at $1.1 million last year. Seniors, veterans and the disabled also may qualify for an additional grant of up to $275.
The proportion of B.C. homes that are valued below the new cut-off for the full grant is 91 per cent, down from 93 per cent last year and 95 per cent in 2012.
B.C. Real Estate Association chief economist Cameron Muir said the loss of the home owner grant for some property owners is unlikely to impact the market.
“We’re talking about a few hundred dollars per year here,” Muir said. “It has a bigger impact on young home owners who have more stretched budgets.”
But most first-time home buyers aren’t purchasing seven-figure homes, he suggested.
“It’s most relevant to seniors on fixed incomes who have seen a tremendous increase in their property values and it’s allowing many of them not to have that additional drain on their limited income.”
Seniors whose property tax bills have skyrocketed over the years also have the option of deferring property taxes until the eventual sale of the home.
Finance ministry data provided to Black Press shows residents of more affordable areas of the Lower Mainland are much more likely to claim the home owner grant than those in the priciest areas such as Vancouver and the North Shore.
More than 76,600 Surrey homes received the grant in 2014, compared to 63,425 homes in the more populous City of Vancouver.
Many Vancouver homes don’t qualify for the home owner grant because of the more rapid climb in house prices there, but they also don’t qualify if they’re not owner-occupied – for example the city’s thousands of investor-owned condos – or if their owners are not Canadian citizens or landed immigrants normally residing in B.C.