New real estate numbers released by the B.C. government this morning are suggesting the newly imposed foreign buyer tax may be helping to cool down the real estate market in Metro Vancouver.
The additional property transfer tax of 15 per cent was levied on foreign nationals who buy real estate in Metro Vancouver. It came into effect on Aug. 2.
The B.C. government says the data show a large number of transactions involving foreign nationals was completed on July 29, the last business day sales could be registered before the additional property transfer tax took effect.
On July 29, more than $850 million in residential property transactions involving foreign nationals in Metro Vancouver were registered. This is equal to more than 55 per cent of all transactions registered in Metro Vancouver on that day, and almost 40 per cent of the total foreign investment in Metro Vancouver residential real estate for the entire period after data collection began and before the additional tax took effect — the time period between June 10 and Aug. 1.
In contrast, the period of Aug. 2-31 saw 60 transactions in Metro Vancouver that involved foreign nationals.
The total value of the properties transferred was $46.9 million, which, the government says, is less than one per cent of total Metro Vancouver transactions during that period.
These transactions raised approximately $2.5 million in additional property transfer tax revenue.
Foreign investment accounted for nearly six per cent of the approximately 48,000 residential real estate transactions in British Columbia between June 10 and Aug. 31, amounting to about 8.8 per cent of the $31 billion in residential property that changed hands.
In Metro Vancouver, 2,034 transactions worth $2.3 billion involved foreign nationals during that period, representing 9.3 per cent of the nearly 22,000 transactions and 11.5 per cent of the $20.6 billion that changed hands.