“The impact of these changes will not change the Vancouver real estate market in any way at all. The real estate market is driven primarily by one thing and one thing alone,” Dustan Woodhouse
, a broker with Dominion Lending Centres
in British Columbia told MortgageBrokerNews.ca. “This thing is not low rates, not foreign buyers, not assignment clause flips, not taxation changes, not down payment changes, - it is emotion. Emotion fuels decision making.”
But that doesn’t mean the changes won’t impact individual buyers.
British Columbia’s finance minister, Mike de Jong, announced earlier this week that buyers purchasing newly built homes valued under $750,000 can save up to $13,000 through a land transfer tax break.
This change will encourage a number of buyers -- both first-time and repeat -- to jump off the fence and into the market, according to Woodhouse.
"(Repeat buyers) just got given some love; repeat buyers now get an exemption on new builds up to $750,000 as well,” Woodhouse said. “This is huge news and will likely stimulate the move up buyers to look around as a $13,000 cash expense has just been removed from the process of moving from one property up to a larger, nicer, brand new place.”
On the flip-side of the changes, however, are purchasers of luxury homes. Under the new changes, they will pay higher land transfer fees.
"A client purchasing a $4,000,000 home is not slowed by a $20,000.00 increase in purchase taxation; they will still pay the four million, it is a non-issue,” Woodhouse said. “A mosquito bite, not the sting of a hornet.
“So no brakes being put on 2M$ plus sales, just an increase in revenue for the Provincial Government to help offset the decrease on the break the Provincial Government is giving to two groups of people who are purchasing brand new properties up to $750,000.”
Just how much will recent home buying changes impact the real estate market in B.C? One veteran lays it all out.