First-time home buyers in British Columbia can now expect to pay less in property transfer tax when purchasing a new home. The BC government announced on Tuesday its 2017 budget and first-time homebuyers’ needs made the cut.
BC Finance Minister Mike de Jong announced that the property transfer tax exemption threshold for the First-Time Homebuyer’s Program will be increased to $500,000 from $475,000. The increase comes into effect today and could save first-time homebuyers up to $8,000 in property transfer taxes.
In yesterday’s budget speech, de Jong said the program has helped nearly 5,500 families save an average of $7,600 since it was introduced last year. Even though the provincial government has tried to address affordability issues facing first-time homebuyers, the British Columbia Real Estate Association (BCREA) says more due diligence needs to happen.
In a news release, BCREA says the new threshold, and all others related to the property transfer tax, should be indexed, with annual adjustments. During the government’s budget consultation in January, BCREA recommended a higher first-time buyer exemption threshold at $750,000, to align with the exemption for newly-built homes and with the BC Home Partnership Program. BCREA says this figure would also open up consumer choices, as the First Time Home Buyers’ Program exemption applies to all homes, rather than newly-built homes, which are usually unobtainable for first-time homebuyers.
This year, the BC government also says it will work with local governments to help ensure municipalities have the capacity, incentives and performance targets to efficiently process approvals and permits of housing development applications.