The City of Vancouver is about to embark on to some uncharted territory, they want to tax your home if you aren’t using it.
The Vacancy Tax has been set up to try and loosen up some rental housing by having you declare if your home is not being used. If the home is not being used and is your secondary home, you will be subject to a 1% vacancy tax, which will be put towards Affordable Housing initiatives.
Vancouver Mayor Gregor Robertson has said that he hopes that the initiative will free up 25000 rental spots in Vancouver alone in the coming year, with residents having until early February to comply.
So, perhaps 25000 new rental spaces and a coffer full of loot for affordable housing, what’s not to like?
LOTS.
How do you measure compliance? The legwork that will have to be done by the City of Vancouver to insure that there isn’t a dodge will eat into that affordable housing fund.
Is the City overreaching here? That is my house, and I pay top dollar for it, so why should I submit to this tax, why should this perception of housing crisis affect my bottom line? There may be a court challenge in this one at some point as what I do with my home is my business and as long as I’m not breaking any laws, and leaving my home empty the last I checked is NOT a criminal offence, then I should be able to do what I want without having to pay the excise tax.
Where does this Affordable Housing Initiatives Funding go? It had better be see through so that people know that 100% of it goes to Affordable Housing. Who gets to decide on what affordable housing looks like? The City? Are they qualified?
What if I choose to pay the tax? 1% per year on a million dollar home is $10000 per year. Would my home not appreciate better if someone wasn’t living in it? Is this now just a cost of doing business? If my house cannot make more than 1% on appreciation and clear my taxes then have I really invested wisely?
I can see the initiative by the City here and am not begrudging the effort. If this does go on to be a success, how many municipalities will jump on this train?
Only time will tell, but as the saying goes, “Some things are destined to be — it just takes us a couple of tries to get there.” We will see if this is the path that leads us to affordable housing.