This year has seen a lot of legislation changes in the BC real estate market that have impacted many people. While they have been widely shared, here is a brief overview of them all in one spot so you can review and have a clearer picture of what they are, and know where you need to do some more research to be well informed.
Property Transfer Tax:
New Property Transfer Tax exemptions for first-time buyers and new homes in BC - In an effort to improve housing affordability, three major changes are being made to the Government of British Columbia’s Property Transfer Tax (PTT) framework - Effective April 1, 2024 -
The threshold to be eligible for the first-time homebuyers’ exemption will be increased from a fair market value of $500,000 to $835,000, with the first $500,000 exempt from the tax. The phase-out range for the complete elimination of the exemption will be $860,000, while properties with a fair market value under $500,000 will be completely exempt.
The newly built home exemption for purchasers who buy a new home for their principal residence will grow from $750,000 to $1.1 million on the fair market value. Homes with a fair market value between $1.1 million and $1.15 million will see a phase-out range of the exemption.
A brand-new PTT exemption will be created for purchases of new qualifying secured purpose-built rental housing buildings, with such buildings required to contain at least four apartment units, be non-stratified, and be used as rentals for at least 10 years, and the residential uses of the building must be entirely used for rental purposes. This specific PTT exemption will apply to transactions for such buildings between January 1, 2025, and December 30, 2030. With home ownership out of reach for many given the elevated home prices, such a policy will help catalyze more “missing middle” rental housing.
Short-Term Rental Accommodations Act:
Introduced in May 2024, this new act is designed to transition properties from short-term rentals back to the long-term rental market. According to the government, this move aims to increase housing availability for residents and could influence market dynamics in our neighbourhoods.
There are several residential property exemptions and mountain and skill hill exemptions to this Act, be sure you familiarize yourself with them.
Residential Tenancy Act:
On July 18th, 2024 the initial changes laid out in Bill 14, required four months' notice – instead of the previous two months' notice – for evictions due to personal or caretaker use. The legislation also raised the dispute period from 15 days to 30 days. Now, the government is amending the regulation to lower the personal-use notice period to three months and the dispute period to 21 days for situations when a landlord gives notice to a tenant on behalf of a purchaser. These changes came into effect on August 21, 2024.
Home Flipping Tax:
The proposed BC home flipping tax applies to income from the sale of a property, including presale contracts - in British Columbia if the property was owned for less than 730 days. Property purchased before the tax’s effective date may be subject to the tax if sold on or after January 1, 2025 and owned for less than 730 days unless an exemption applies.
This new B.C. home flipping tax will come into effect January 1, 2025 and applies for two years after a property is purchased.
This is a lot of information and has probably left you with questions. I would be more than happy to answer any questions you may have, I encourage you to reach out!
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