Is levying a tax on foreign buyers the right step?
Many Canadian home owners and buyers or of the opinion that some affordability has become a thing of the past for Canadian residents in Vancouver as they continue to experience a rise in home prices.
In the midst of all the talks about how the city house prices are escalating, a 61 year old communication designer in confusion on how his house has worth over 20 times what he had initially bought it for.
He explained that “housing has become an interesting commodity in this city. Life in the city has become vigorous and everyday people are giving their opinion about the increase of home prices and their effects to the community.”
Even though Metro Vancouver has over the years been recognised as one of the most expensive housing cities, Canadians were very surprised when the government introduced a 15% tax on foreign investors.
This new policy was released after real estate leaders claimed that foreign investors had no influence on the housing prices in Canada.
Klaasen the apparent inheritor of runway real estate prices explained that his home could now be sold for over $2.4 million while the home was initially bought for $126,000 in 1982.
Although Klassen can rip massive profits by selling his property he is quite saddend by the fact that foreign money goes a long way to affect the real estate market in Metro Vancouver and a lot of residents are leaving because of this.
The new tax has also raised questions from Metro Vancouver residents as to why it was implemented after authorities had denied that foreign buyers had no effect on the housing prices.
However Metro Vancouver is not the only city affected by the new tax imposed on foreign investors, Greater Toronto is also affected as they are also experiencing an increase in home prices.
But the main concern currently is if the new policy is actually working? Or is it too early to figure out the true effects?
The Greater Vancouver Real Estate Board reports for September shows that there was a drop in house prices but the GVREB states that the standard price still remains in place