Image: Pattison Media / File

By Liam Verster, Vernon Matters with files from Fraser Valley Today

New Tax

B.C.’s home flipping tax will come into effect in January

Dec 27, 2024 | 6:00 AM

CHILLIWACK — Penalties for flipping homes in British Columbia will come into effect in the new year.

Starting January 1, 2025, the B.C. home-flipping tax will be in place to discourage investors from buying homes in order to take advantage of the housing market and turn a quick profit.

People who buy their homes and sell them within the following two years will be subject to the tax, which will be based on the sellers tax income minus the primary residence deduction.

There will be exceptions from the tax in specific circumstances, such as divorce, death, illness, relocating for work, job loss, or a change in household membership.

“The B.C. home-flipping tax is just one more tool in our toolbox to help people find affordable housing,” Ravi Kahlon, Minister of Housing and Municipal Affairs, said. “We’re working to deliver more homes so the people who keep our communities working, like teachers, nurses and construction workers, can find a place to live they can afford in the communities they love.”

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The province will also launch an expansion to its delivery of more rental homes. From Jan. 1, 2025, to Dec. 31, 2030, new purpose-built rentals with four units or more may qualify for an exemption from the general property transfer tax. The translates to roughly $278,000 in savings on a purchase of a purpose-built rental building valued at $10-million.

The province noted it has other measures to make home ownership more viable for British Columbians in 2025.

The B.C. Government increased the first-time homebuyers’ program threshold from $500,000 to $835,000 this past April, and qualified individuals can claim an exemption from the property transfer tax up to $500,000. Reduced exemptions are available for homes valued at between $835,000 and $860,000.

The province also increased its threshold for newly built homes in 2024, bringing it up from $750,000 to $1.1-million.

The government said the first-time homebuyers’ program helped around 22,000 people buy their first homes, while the new-build threshold exemption allowed approximately 10,300 people buy new homes.

“Everyone should be able to afford a home in their chosen community, but high home costs and real estate speculators are making that a challenge,” Brenda Bailey, Minister of Finance, said. “We are working to ensure there are more affordable homes available for people, whether they’re renting or buying, through measures like the B.C. home-flipping tax and property transfer tax exemptions.”