The BC Minister of Finance has announced several changes to the Property Transfer Tax program, effective Wednesday, Feb 17th, which include...
1. A property transfer tax exemption for Canadian citizens and permanent residents who purchase newly-built homes, condos and townhouses under $750,000. Purchasers must live in the property for at least one year. This is a potential savings in closing costs of up to $13,000.
2. A 1% increase in property transfer tax to 3% for homes which are sold over the $2 million mark.
3. Buyers will need to start disclosing their country of residence in all property transactions.
4. The beneficial ownership of properties held by corporations will also be tracked.
*The first time home buyers exemption will remain in place for all homes under $475,000
This change will encourage a number of buyers -- both first-time and repeat -- to jump off the fence and into the market. Repeat buyers now get an exemption on new builds up to $750,000. This is good news and will likely stimulate the move up buyers to look around as a $13,000 cash expense has just been removed from the process of moving from one property up to a larger, nicer, brand new place.
Here is a break down of the Property Transfer Tax...
The amount of tax you pay is based on the fair market value of the land and improvements (e.g. buildings) on the date of registration unless you purchase a pre-sold strata unit. The tax is charged at a rate of:
- 1% on the first $200,000,
- 2% on the portion of the fair market value greater than $200,000 and up to and including $2,000,000, and
- 3% on the portion of the fair market value greater than $2,000,000
If you have more questions please contact us...The Aziz Group
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