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Vancouver's Empty Homes Tax to Generate Estimated $30 MillionCity of Vancouver
VANCOUVER - Mayor Gregor Robertson has announced that Vancouver's Empty Homes Tax, the first of its kind in North America, will generate an estimated $30 million in revenue to the City, with the net revenue after costs to be invested into affordable housing initiatives.
Of the $30 million we estimate to be generated by the tax, approximately $17 million has been collected to date. The total revenue collected will pay for the one-time implementation costs ($7.5 million) and first-year (2018) operating costs ($2.5 million). All remaining revenue will go towards affordable housing initiatives in Vancouver.
A rigorous system of auditing is currently underway, and we are also reviewing disputed tax bills; therefore, the total and net revenue numbers are expected to change over the coming months. An update on declarations and revenue collection will be provided in the fall of 2018 when the audits are complete.
Quote from the Mayor
"We brought in the Empty Homes Tax because we want to ensure that housing is for homes first, not just treated as a commodity," said Mayor Robertson. "With a near-zero vacancy rate, we can't have homes sitting empty while people who want to live and work in our city are struggling to find a place to rent."
"Our hope was that the tax would be an incentive for owners to rent out their homes that are empty for most of the year. For those who didn't make their empty home available for rent, they have made — or will be making — a welcome contribution to Vancouver's affordable housing programs."
A total of 183,911 declarations were submitted in the first year of the program, accounting for 98.85% of all residential property owners in Vancouver. Just under 8,500 properties were determined to be unoccupied or underutilized:
- 1,200 were declared vacant by the owner
- 2,100 people failed to declare, and their properties were deemed vacant and subject to the tax
- 5,200 properties were declared exempt from the Empty Homes Tax
Of the 5,200 properties declared exempt, the breakdown of type of exemption is:
- 2,480 where the property title transferred during the year
- 1,560 were under renovation or redevelopment
- 560 due to strata restrictions on rentals
- 600 other, including owner in care or death of owner, and occupied for more than180 days for work in Vancouver
The Empty Homes Tax is based on 1% of the assessed taxable value of the property. The median dollar amount of tax paid to date is $9,900, with a range in payments between $1,500 to more than $250,000.
Properties for which an Empty Homes Tax declaration was not received by the due date have been deemed vacant and property owners will be charged a $250 penalty. Late or unpaid payments are also subject to a 5% penalty. If they do not submit a payment by December 31, 2018, the Empty Homes Tax will be added to their property tax account.
Any unpaid balance on your tax account after the due date will result in a 5% penalty being charged; after the first year interest is also charged on the balance owing. At the end of three years if the taxes are still outstanding, the property is publicly auctioned at a tax sale to recover the taxes owing.
Last week, Vancouver City Council instructed staff to embark on a public consultation effort to solicit input from Vancouver residents about how they would like to see the revenue from the Empty Homes Tax used to support affordable housing in the city. More details will be released in the coming days.
As part of the Housing Vancouver Strategy, the Empty Homes Tax is one of many actions we are taking to increase the supply of rental homes and improve housing affordability in Vancouver. The program aims to return empty or under-used residential properties back into the rental pool for the people who live and work in the city.