Victoria’s city council has asked the B.C. government to expand a foreign-buyers tax introduced last year in Vancouver to include the Victoria region.
Mayor Lisa Helps said the city does not want to target foreign buyers who come to live and work in Victoria, but would like to deter real estate speculators who are not residents.
“I wouldn’t want to be seen as a place where people from China, the United States, Israel or anywhere else aren’t welcome to come and live here,” Ms. Helps told a city council meeting on Thursday at which councillors voted 5 to 3 to support asking for a tax on foreign buyers. “This does not talk about that. This is a speculative tax.”
The B.C. government imposed a 15-per-cent tax on foreign buyers in the Vancouver region last August. The city also asked the province for powers to impose a tax on vacant homes in Victoria.
On Thursday, the Ontario government announced a similar 15-per-cent tax for foreign buyers in the Toronto region, which took effect on Friday.
Victoria city councillor Geoff Young told the council he could not support the foreign-buyers tax because it is not clear the Vancouver tax will have a long-term benefit and said he does not believe a tax will target only true speculators.
He said he also disagrees with the concept of introducing a tax on people from other countries, saying it raises the spectre of the head tax once imposed on Chinese immigrants.
“I really think we may end up being seen to be on the wrong side of history on this one,” he said.
Property values have been climbing more rapidly in Victoria than in Vancouver in recent months. Prices of all types of housing climbed 15.5 per cent in Victoria in the first quarter of 2017 compared with the same period a year earlier, according to the Royal LePage house price survey, while prices were up 10.1 per cent in Vancouver in the same period.
Victoria home prices climbed 20 per cent in March compared with the same month a year earlier, according to Canadian Real Estate Association data.
Brad Henderson, chief executive officer of Sotheby’s International Realty Canada, said he disagrees with foreign-buyer taxes in all markets in Canada.
He said the Vancouver tax had the unintended consequence of pushing a “nominal” number of foreign buyers to the Victoria market. But he believes domestic demand for property in Victoria is the main reason for price increases in the market.
“We think the broader issue is the price of Vancouver real estate versus Victoria … and people’s lifestyle decisions to sell their Vancouver property, buy in Victoria, and take money off the table,” he said.Report Typo/Error