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NEW! BC Government Housing Measures in 2024 Budget

(February 26, 2024 )

In the 2024 Budget released by BC Government on February 22, 2024, some new measures and Policies were introduced, that may be meaningful to you.Here's a quick overview:

Property Transfer Tax Exemption:

- An increase to the Fair Market Value Threshold for first-time Buyers (FTHB) Exemption:

Currently the FTHB full exemption applies to properties with a fair market value (FMV) of less than $500,000.00, with a partial exemption for properties with a FMV of $500,000.00 to $525,000.00.

As of April 1st, 2024, the FTHB exemption will apply to properties in a different way. For properties with a FMV (Purchase Price) of less that $835,000.00, Property Transfer Tax (PTT) is not payable on the first $500,000.00, but payable on the difference between the FMV (Purchase Price) and $500,000.00 For example, if the FMV (Purchase Price) is $700,00.00, PTT would be 2% of $200,000.00 ($700,000.00 less $500,000.00). Not paying PTT on the first $500,000.00 saves the purchaser a total of $8,000.00.

If the property has a FMV (Purchase Price) between $835,000.00 and $860,000.00, then a partial exemption applies, the details of which are not yet confirmed by the BC Government.

If the FMV (Purchase Price) is over $860,000.00, then there is no FTHB PTT exemption.

Increase in the FMV (Purchase Price) Threshold for Newly Built Home Exemption:

Effective April 1, 2024, the FMV (Purchase Price) threshold to claim the Newly Built Home Exemption will be increased from $700,000.00 to $1,100,000.00. A partial exemption is also available; for properties with a FMV (Purchase Price) just above the threshold. The phase out range is $50,000.00 above the threshold, so properties with a FMV (Purchase Price) of greater than $1,150,000.00 will not be applicable to claim the Newly Build Home Exemption.

Purpose-Built Rental Exemption:

The 2023 Budget included a limited exemption for purpose built rental buildings, that may limit the tax payable on values over $3,000,000.00. Budget 2024 builds on this exemption and provides an exemption from PTT on purchases of new qualifying purpose-built rental buildings.

New Flipping Tax:

A new tax targeting home flipping activity and short-term speculation will officially begin on January 1, 2025. This tax will apply on the sale of a residential property held by an owner for less than two years with the seller being taxed up to 20% of the income from the sale. To specify, properties sold within 1 year are taxed at 20%, and will decline to zero between 366 days and 730 days. Exemptions may apply in certain circumstances.

As with most legislation, other conditions may apply and there is some nuance to the above summary. Please seek professional advice if you have questions pertaining to legal, finance and tax matters.

Sources: Spagnuolo and Company LLP - Tony Spagnuolo

NEW! BC Government Housing Measures in 2024 Budget

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