Thursday, September 20, 2018

Developers warn new taxes will drive housing costs up in Vancouver

Members of Vancouver’s development community say they’ve seen the light these past couple of weeks as they realize just how British Columbia’s new tax measures could impact them.

One of Vancouver’s biggest developers says he could be looking at an additional $8-million in property transfer taxes alone.

The most controversial measures are the province’s additional 2-per-cent property transfer tax and the school tax on residential properties valued at more than $3-million. Those taxes aren’t just targeting wealthy people who are buying up west side houses, or homeowners who’ve amassed significant equity as housing prices soared. Developers who purchase parcels of land for future housing projects must also pay. And those taxes, they say, will drive housing costs up because the added costs will get shifted over to the consumer.

Polygon Homes president and chief executive officer Neil Chrystal recently wrote a six-page letter to Finance Minister Carole James, suggesting revisions to the government’s new tax measures. In the letter, Mr. Chrystal said Polygon has built 28,000 homes in the region since 1980. He recommends that multifamily residential projects be exempt from the 2 per cent property transfer tax increase. He says he’s looking at an additional $8 million in property transfer taxes alone, based on current projects that have yet to close.

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