Kevin’s blog:
Kevin has emphasized upon the fact that “students” have been suspiciously owning millions of dollars of housing properties while full time working Canadians are not able to afford housing in Vancouver. He believes that foreign investors play a key role in this rise in housing prices along with wealthy migrants.
I agree with Kevin’s point of view on the causes of this housing crisis for, but today when we look at the bigger picture, it doesn’t seem to be that scary anymore. In the month of October itself, the demand for houses has gone down by 39% as compared to October the previous year. As stated in a CBC news article, 2,233 houses were sold this October compared to 3,646 properties sold in October last year. This fall in demand is most likely occurring from the 15% tax on foreign buyers which has discouraged purchase of properties.
This is also reflected in a report by the globeandmail, which shows that ever since the additional tax has been introduced, the government has received 166 new property-transfer-tax returns, which resulted in a $10.1 million in property-transfer-tax paid! It also reports that back in the June-August period, foreign buyers accounted for about 1,974 transfers out of Vancouver’s total 14,978 but in the August-September period, foreign property buyers represented a mere 152 out of the total 12,114 of Vancouver’s total property transfers! Not only has this tax dealt with the rising housing prices, it well has also proved to be a major revenue producer for the government which it can use for public welfare.
Hence though Kevin hasn’t analyzed the housing market accurately enough, he does stress on the fact that foreign and immigrant homeowners have had a large impact on the housing shortage. The Canadian government has proposed a 1% tax on empty/ vacant houses too now which means that every homeowner would need to fill out a self-declaration of his/her residence status and only the vacant homes will be subject to the tax.
This proposed tax is expected to be in effect by 2018. In line with Kevin’s concerns on a shortage in housing for Canadians, the government estimates that this plan would be extremely efficient in reducing the shortage by filling up these houses and not letting foreign investors use these properties as simple commercial assets. If they leave their homes vacant, they would be taxed just as much a they would be taxed while owning commercial properties. Hence, the government has undertaken an incredible step to fill up these houses and effectively deal with the shortage in supply for homes for Canadians and residents in Vancouver!
Word Count:436
Reference:
http://vancouversun.com/news/local-news/vancouver-sets-empty-homes-tax-at-one-per-cent
http://www.cbc.ca/news/canada/british-columbia/vancouver-real-esate-down-1.3833789
