In a move to curb foreign property speculation in the Metro Vancouver Area, an additional Property Transfer Tax of 15% was implemented by The Province on all residential real estate transactions completing after August 2, 2016. The abrupt implementation and communication of the new tax sparked debates about not only the actual impact it would have on property prices, but also who was aware of the tax before the public announcement, and was the move politically fueled? Aside from the headlines stirred up by the media, a number of REALTORS® took to social media to voice their concerns that not only would the tax potentially hurt foreign demand, but also the domino effect it could create where a foreign buyer walks away from a deal impacting the corresponding completion dates of local buyers. The general consensus has been that foreign buyers do only make up a small part of overall business - consistent with the government audit concluding foreign buyers only accounted for approximately 5% of all transactions - and that there wouldn't be a huge impact.
July also had Ottawa considering lowering rates (even implementing negative rates as reported by the media) to bolster the weak economy. Ultimately they were unchanged and the next announcement is scheduled for September 7th.
More interestingly, on the ground, again fewer parties through open houses continued to be the trend as compared to previous months this year. Sales-to-active-listings ratio dropped month over month from 56.3% in June to 38.6%. While still largely a "Sellers Market" , this is the largest month-over-month drop this year. The high was back in March 2016 when the ratio was 70%. Click this link for an explanation of the sales-to-active-listings ratio.
- 3226 units sold: -18.9% from July 2015, -26.7% from June 2016
- Listings supply -27.4% from June 2015
- Sales-to-active listings ratio of 38.6%