If one goal of the B.C. government’s new housing taxation policies was to cool home sales in the province, it has likely succeeded, if the results of a new poll of real estate agents are anything to go by.
Nearly 80 per cent of the 400 Royal LePage real estate advisors surveyed by their brokerage said they expected home sales in the province to decrease in the first three months of the policy announcements.
The policies set out in the poll included the new speculation tax, the expanded and increased foreign buyer tax, and the increase to the property-related school taxes and land transfer taxes on homes over $3 million.
A further 85 per cent of respondents operating in B.C. said that the new policies have hurt home buyer confidence in residential real estate.
However, less than half of the respondents (44.8 per cent) said they thought B.C. residents were the demographic group most affected by the changes, although this was the largest single group identified. Some 43.5 per cent said Canadians who own or want to buy property in B.C. but live in other provinces are most affected, followed by 11.3 per cent of real estate advisors who said the policies would affect foreign buyers most of all.
“The expected impact of the proposed housing taxes announced in British Columbia should not be taken lightly,” said Phil Soper, president and CEO of Royal LePage. “Homeowners across the province will feel the effects as major policy changes like this are also amplified by a drop in consumer confidence. We saw this happen in 2016 when the previous government launched a tax on foreign investors... Canadian homebuyers from coast to coast were already struggling with new federal restrictions on access to mortgage financing.”
Soper added, “We expect that the new taxes will materially impact communities that rely on recreational property markets for the health of their local economy. There will be some Canadians in British Columbia and across the country that will choose to sell their properties in the province as the new taxes add to the cost of homeownership.”
More than 90 per cent of the respondents said they believe the speculation tax specifically will reduce sales in the province from prospective buyers in other areas of Canada, such as Alberta.
The survey results are in contrast to those of an Insights West poll of British Columbians, which found that four out of five respondents were in support of the new taxation measures.