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BC Government Budget Affecting Real Estate
BC Government Unveils New Housing Measures in 2024 Budget
The BC Government has recently introduced a range of new housing measures in its 2024 budget, aimed at addressing the ongoing housing crisis in British Columbia.
BC Home Flipping Tax: Starting January 1, 2025, a new tax will be implemented on the sale of residential properties within two years of purchase, targeting speculative real estate practices. This move is expected to contribute to stabilizing housing prices and increasing the availability of affordable homes. Exemptions to the home-flipping tax will be available to people who face unavoidable life changes, including death and divorce, job relocation or loss, and people who are adding to B.C.’s housing supply.
Enhanced Property Transfer Tax Exemptions: Significant improvements have been made to make home ownership more accessible. The First Time Homebuyers’ Program has been expanded, with increased thresholds allowing more buyers to benefit from tax exemptions. This includes full exemptions for homes valued up to $835,000 and partial exemptions for those up to $860,000, potentially saving buyers up to $8,000. Furthermore, buyers of newly built homes valued up to $1.1 million will enjoy reduced costs, encouraging the purchase of new properties.
Bare Trust
New trust reporting rules came into effect December 31, 2023, which apply to bare trusts in Canada. If you have co-signed a mortgage for a home where you hold at least 1% of the title, and you are not living in that home, these new rules apply to you.
Most commonly, these new rules will apply to parents who have co-signed for their children's mortgage and, subsequently, hold 1% of the title of that home. If you do not file a T3, the penalty can be as much as $2500 or 5% of the fair value of the property held in trust.
If these rules apply to you, you have until April 2, 2024 to file a Schedule 15. Please contact your accountant for further assistance in making your filing.
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