These 13 B.C. communities will be subject to the speculation and vacancy tax

B.C. expands speculation tax on homes The provincial government has expanded the number of communities subject to the speculation and vacancy tax.

The province is expanding the speculation and vacancy tax to more municipalities in an effort to turn empty units into homes, B.C.’s finance minister announced Wednesday.

The 13 additional communities bring the total municipalities subject to the tax to 59.

“Homes shouldn’t be left empty and they shouldn’t be used as investments by speculators,” Finance Minister Katrine Conroy said at a news conference. “Homes should be used by people so they can live where they work and their children go to school.”

The speculation and vacancy tax will apply to the following municipalities next year:

• Vernon

• Coldstream

• Penticton

• Summerland

• Lake Country

• Peachland

• Courtenay

• Comox

• Cumberland

• Parksville

• Qualicum Beach

• Kamloops

• Salmon Arm

Conroy said the communities were chosen based on a variety of factors, including vacancy rates, housing prices, population, and the percentage of homeowners who don’t live in the municipality.

Of the municipalities newly added to the list, she said Lake Country had the highest rate of vacant homes.

“Something is wrong when speculators are buying up investment properties and leaving them empty while many young families are living in RVs in communities nearby,” Housing Minister Ravi Kahlon said at the news conference.

“The speculators are making money off of driving up the value of property when instead they should be housing for people.”

The province says it has collected $313 million from the speculation and vacancy tax since 2018, which has been used to fund affordable housing in the municipalities the tax applies to.

And according to a 2022 review, the tax resulted in 20,000 homes becoming available in Metro Vancouver.

Resort municipalities such as Whistler, Tofino and Osoyoos remain exempt from the speculation and vacancy tax, and Conroy said there are currently no plans to include them. She said the government is considering adding the tax to some smaller communities, citing the Gulf Islands as an example, but not yet. Property owners in the 13 new communities will be required to declare for the first time in January 2025, based on how they used their property in 2024.

Conroy said the province is giving homeowners just over a year to decide what to do. Using those who have a second summer home as an example, she said they can rent out the property for at least six months out of the year, rent full time, sell the home, or simply pay the tax.

Exemptions to the tax include primary residences, properties with a long-term tenant and “life events” like divorce. Summer cabins that are uninhabitable in the winter could also get an exemption, Conroy added.

She said that 99 per cent of British Columbians are exempt from the tax.

The tax rate is two per cent of a property’s assessed value for foreign owners and “satellite families,” and 0.5 per cent for Canadian citizens or permanent residents.