Move To Nanaimo

23 February 2008

BC Budget Assists Affordability and the Environment

Posted by Ryan Coffey under: Nanaimo Real Estate Market .

Here is a press release from the British Columbia Real Estate Association (BCREA) regarding some changes to real estate as part of the new B.C. budget. They keep raising the maximum purchase price for first time buyers getting an exemption on property transfer tax. (You can also check out another post I made fairly recently about that tax if you like.) The raised it last year to so they seem to be quite interested in making things more affordable for first time buyers as the property prices continue to increase in B.C. Can’t say that’s a bad thing at all. This plus the cuts to the GST (which only applies to new homes and the services of the professionals you hire) and the so far continuing (and projected) decline of interest rates adds up in making things easier for buyers overall, but especially people for who are trying to buy for the first time.

My only question is … Why do they make the price a province wide standard? The new Property Transfer Tax exemption threshold of $425,000 is pretty high for much of the province but not everywhere. In Nanaimo, that’s a pretty nice house, big and with an ocean view and possibly not too old, in the little towns up north that can be a veritable mansion in some towns but in Vancouver that price range will get you a condo, half a duplex or a really basic home. I wonder why they don’t adjust it by area according to the average sale price of the area? Maybe they want people to move to places other than Vancouver.

Kudos either way, and on the environmental direction things are taking too. On that note, I bought a hybrid vehicle last year and got $3500 back from the government for doing so. This offset the extra cost of getting the hybrid model, and that’s before we start talking abut gas savings. I don’t think anyone will disagree with me that these moves aren’t enough in themselves to prevent the world from environmental ruin, but it’s a good start.

Ryan

BC Budget Assists Housing Affordability and the Environment

Vancouver, BC, February 19, 2008 – First-time homebuyers and current owners will potentially
benefit from measures to improve the affordability and sustainability of homes introduced in today’s
provincial budget.

Improvements to Housing Affordability

Commenting on today’s budget, Tony Joe, Victoria REALTOR® and president of the Victoria Real
Estate Board, identified key policy changes for real estate: “The increase in the Property Transfer
Tax (PTT) exemption threshold is an important step in the right direction to improve housing
affordability. PTT continues to add significant cost to the purchase of a home, and the real estate
profession is pleased the thresholds have been increased.”

The PTT exemption threshold has been increased to $425,000 from $375,000, making this the third
straight provincial budget in which the threshold has been adjusted. “BCREA has consulted with
government about our concerns on housing attainability, and we are encouraged that government has
continued to respond to the needs of BC homebuyers,” Joe confirmed.

First-time buyers also benefit from removal of the financing rule, which required them to have at
least a 70 per cent mortgage to qualify for the exemption. They can now pay down their mortgages
by any amount in the first year of ownership without losing entitlement to the exemption.

The PTT is a registration tax an individual must pay when purchasing or acquiring an interest in
property. The amount payable depends on a property’s fair market value, and is charged as one per
cent on the first $200,000, plus two per cent on the remainder.

Even with the threshold change, the government will collect more than $1 billion in PTT revenue this
fiscal year—a record amount.

Green Initiatives Aid Homeowners

Today’s budget establishes an assortment of Provincial Sales Tax exemptions on home renovations,
retrofits and purchases of energy-efficient appliances for current owners. This could help reduce
home energy consumption and the related operating costs over a long term.

“Homes that meet a green standard are more energy-efficient and environmentally sustainable,”
says Joe. “But they cost four to six per cent more to build, compared to existing housing stock.
The real estate profession will continue to work with the government to assist the attainability of
affordable and sustainable homes for British Columbians.”

Last September, BCREA recommended the government introduce a pilot program that would
encourage the purchase of new homes that meet a green standard through a reduced PTT. The
Association also recommended Provincial Sales Tax rebates on purchases for renovations to improve
energy efficiency and other environmental aspects. These suggestions are available online at
http://www.bcrea.bc.ca/govt/2008ProvPre-Budget.pdf.
About BCREA

BCREA represents 12 member real estate boards and their approximately 18,000 REALTORS®
on all provincial issues, providing an extensive communications network, standard forms,
government relations, required post-licensing courses and continuing education.

To demonstrate the profession’s commitment to improving Quality of Life in BC communities,
BCREA supports growth that encourages economic vitality, provides housing opportunities,
respects the environment and builds communities with good schools and safe neighbourhoods.

For more information about BCREA, please our website at bcrea.bc.ca.

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For more information, please contact:

Tony Joe, president, Victoria Real Estate Board, 250.385.7766
Cameron Muir, chief economist, office: 604.742.2780, mobile: 778.229.1884
Steve Olmstead, manager of government relations, 778.773.9172

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