10 things to know about the 2016/2017 BC Provincial Budget
And how it affects Real Estate in Vancouver
One of our resident Mortgage Brokers – Tom Prasol of 4Front Mortgages – has offered some information on the new BC Budget and how it affects you as a resident in BC, and the Vancouver Real Estate market. Take a look below and contact him if you have any questions on these changes or how he can help with your mortgage needs.
1. Buyers of newly-built homes, condos and townhouses (see link below for Newly Built Home Exemption criteria) worth up to $750,000 will be exempt from the property transfer tax, saving up to $13,000. This is effective Feb 17, 2016 and is ONLY for Canadian citizens or permanent residents. There is a partial exemption for homes between $750,000.00 and $800,000.00. Please refer to the BC Government PTT website for more info.
2. The Newly Built Home Exemption will only apply to people who actually occupy the home as their principal residence for a year after the purchase (relatives do not qualify) and BC will share information with Revenue Canada to double-check whether the rules are being followed. The Occupancy criteria is (refer to the above link for more details):
- a. move into your home within 92 days of the date the property was registered at the land title office, and
- b. continue to occupy the property as your principal residence for the remainder of the first year.
3. All residential properties (both new and used) sold for more than $2 million will now pay a 3% increased property transfer tax on the portion of the sale value over $2,000,000. This is up from the current 2 per cent. (e.g. a $4,000,000 sale would be: 1% first $200,000, 2% next $1.8M, and 3% on the $2M over $2M, therefore PTT is $98,000. Under the old rules, that number would have been $78,000, a $20,000 increase.)
4. The existing first-time homebuyers program for re-sale homes remains unchanged; the threshold remains at $475,000 (with a partial exemption for homes between $475,000.00 and $500,000.00).
5. Property buyers will need to disclose their citizenship for government tracking.
6. (FYI) MSP premium rates will rise $3 per month for an adult to $78, starting in 2017, children are now exempt from paying MSP premiums.
7. (FYI) The special discounted MSP rate for couples is eliminated, adding $14 a month to a family with two adults.
8. (FYI) Taxpayer-supported debt is budgeted to rise to $43.2 billion, which means 3.7 cents of every dollar government earns is paid toward debt servicing.
9. (FYI) The $47.5 billion budget next year will have an estimated surplus of $264 million. The economy is expected to grow 2.4 per cent.
10. (FYI) Income assistance for those on disability will rise $77 a month, except for those who already receive a bus pass or transit assistance. It’s the first increase in the rate in nine years. The overall welfare rate remains unchanged.