Foreign buyers lured by loopholes, low dollar

'Bare trust' lets offshore investors duck property transfer tax, while local residents are priced out of Metro Vancouver housing, NDP says

Finance Minister Mike de Jong

While young people struggle to rent or buy a home in Metro Vancouver, overseas investors are snapping up high-end commercial real estate thanks to a low Canadian dollar and loopholes in the property transfer tax, opposition MLAs say.

Finance Minister Mike de Jong changed the tax rules in his latest budget to exempt buyers of new homes up to $750,000, and increased the rate from two to three per cent for value over $2 million. But the province continues to reap a windfall on resold homes, the vast majority of the market, with one per cent on the first $200,000 and two per cent on value between $200,000 and $2 million.

NDP housing critic David Eby says the tax not only drives up already unaffordable home prices, it can still be avoided by offshore investors buying up downtown Vancouver office towers like the Bentall Centre and Royal Centre.

The NDP and some municipal officials are also calling for a non-resident tax on residential purchases, to deter foreign buyers from buying property and leaving it empty as values climb.

“There is a huge frustration in Metro Vancouver that spreads all the way up to Squamish, where people are tired of the fact that their wages have no connection to real estate prices, and they are fed up,” Eby said.

The province is moving to restore citizenship and residency declarations for real estate purchasers, but de Jong says he needs to collect data to measure the problem of non-resident investors before taking action.

Data are also needed for a commercial property technique developed to avoid the property purchase tax when it was imposed in 1987. A “bare trust” separates legal and beneficial ownership, allowing the property to change hands without paying the transfer tax.

De Jong said bare trusts and share transfers, where the registered owner doesn’t change but controlling interest does, are long-accepted business practices.

“We actually do encourage people to come to British Columbia and invest,” de Jong said. “The purpose here is to ensure that they are paying their fair share, that they are abiding by the laws that British Columbians and Canadians must abide by, and to ensure that we have to make sure we have the information necessary to enforce those rules.”

 

Just Posted

Twilight Drive-In announces open season for moviegoers next Friday

Opening weekend will showcase a double feature with Aquaman at 7:15 p.m. and Glass at 9:50 p.m.

Elementary b-ball teams receive surprise game visit from ACSS Totems

Two grade 5 co-ed basketball teams were cheered on by players from the highschool Totems team.

Betty Gilbert b-ball boys defeat HD Stafford 38-28

Betty Gilbert’s grade 6 boys opened basketball season with a win against HD Stafford Tuesday.

Langley teams headed to upcoming basketball provincials

Teams from around B.C. converge on the Langley Events Centre for provincial tournaments.

From a drunk judge to Clifford Olson: George Garrett recounts a life in B.C. news radio

New book from ‘Intrepid Reporter’ George Garrett offers readers a glimpse behind the headlines

Sell regulated heroin to curb B.C.’s overdose problem: report

B.C. Centre on Substance Use points to organized crime and money-laundering as contributing factors

More people signing up for compulsory vaccines

Maple Ridge mom says public tired of hearing about measles

UPDATE: Man charged in stabbing of woman, off-duty cop outside B.C. elementary school

Manoj George, 49, is facing two counts of aggravated assault and two counts of assault with a weapon after the incident on Wednesday, Feb. 20.

Why do zebras have stripes? Perhaps to dazzle away flies

Researchers from University of Bristol look into why zebras have stripes

Poll: More voters believe Canada doing worse under Trudeau government

22 per cent believed the country is doing better and 27 per cent said things are the same

HBC shuttering Home Outfitters across Canada

North America’s oldest retailer is revamping its various stores to improve profitability

BC SPCA investigates Okanagan woman with prior animal abuse convictions

BC SPCA is investigating a property near Vernon

Man wanted for sex trafficking, confinement may be heading to B.C.

Kevin Myrthil, 26, is also accused of assault on a 19-year-old woman at an Edmonton hotel

VIDEO: ‘Heroes’ rescue teen trapped in car in Fraser Valley ditch

Two men sprang into action, holding 17-year-old’s head out of water as they pried open door

Most Read