TORONTO — British Columbia’s new speculation tax on out-of-province buyers will likely convince a wave of owners to sell their vacation properties, pushing down home prices, said a forecast from Royal LePage.
By the end of September, the real estate company is expecting the average price of a recreational home in B.C. to reach $531,333, a 2.8 per cent drop from last year’s average of $546,444.
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Under B.C.’s speculation regulations, owners outside the province will be taxed 0.5 per cent this year, but next year will see the rate climb to 2 per cent for foreign investors and 1 per cent for Canadian citizens and permanent residents not living in B.C. but owning properties in the province.
Royal LePage concluded the tax would spark a price dip in B.C.’s recreational housing sector after surveying 200 real estate advisors who specialize in such properties between May 15 and June 1.