What Home Buyers need to know about the Changes to the BC Budget
The BC Government announced the 2016 BC Budget this week, which included changes to certain taxes and benefits that have a direct impact on Home Buyers. Read on to see if you’re affected – these changes may lead you to decrease your budget to stay under a certain threshold or increase your budget thanks to exemptions and credits.
Property Transfer Tax (PTT)
• a New Housing exemption will apply to newly built homes or newly subdivided units priced up to $750,000, saving buyers up to $13,000; and
• a partial exemption will apply on newly built homes priced $750,000 to $800,000.
• a new 3% PTT rate will apply to the portion of a home sale that exceeds $2 million. For homes that sell for below $2 million, the PTT will continue to apply at a rate of 1% on the first $200,000 and 2% on the balance.
• the existing first-time homebuyers PTT Exemption program for re-sale homes remains unchanged; if you spend less than $475,000, are a Canadian Citizen or Resident and have never owner property before, you are exempt from paying the Property Transfer Tax (with a partial exemption for homes between $475,000.00 and $500,000.00).
These changes will take effect on February 17, 2016.
Data collection on Home Buyers
Starting this summer, individuals and corporations buying property must disclose if they are Canadian citizens or permanent residents of Canada and if neither, their home country. These changes will provide information on the volume of foreign investment in BC.
BC Home Owner Grant
The Home Owner Grant threshold will increase to $1.2 million from $1.1 million for the 2016 tax year.
Affordable housing in BC
The province will invest $355 million to help the BC Housing Management Commission support more than 2,000 affordable housing units for residents with low-to-moderate incomes.
If you have any questions on these programs, contact us! We’re happy to help, and can refer a great mortgage broker to get you started on your financing. Check out these additional government resources: read the Housing Affordability Background or read the Budget Speech in its totality.