City of Vancouver's Empty Homes Tax revenues reach $106 million

Dec 1 2021, 9:41 pm

The number of vacant homes within the City of Vancouver continued its downward trend in 2020, and the municipal government is citing its Empty Homes Tax (EHT) as a contributing factor.

The newly released report on EHT’s impact and performance for 2020 shows there were 1,627 residential properties deemed, determined, or declared vacant by the city — a drop from 1,769 homes in 2019, as well as 2,036 homes in 2018 and 2,193 homes in 2017, the first year of the policy.

Moreover, 36% of the properties classified as vacant in 2019 were converted to occupied status in 2020. Most of the exempt and vacant properties are condominiums, which account for 58% of the combined exempt and vacant properties.

In 2020, during the peak of the pandemic’s impacts, nearly half (47%) of the properties that qualified for EHT exemption were for property transfer reasons, followed by 29% for renovations, 13% for strata restrictions, and 11% for other reasons.

The number of properties required to make a declaration for 2020 totalled 195,012 units, including 104,155 condominium units, 80,588 single-family dwelling units, and 10,269 units deemed exempt. This amounts to a year-over-year change of 2,630 more condominium units, 95 fewer single-family dwelling units, and 360 more exemptions.

To date, over the first four years of the policy, the city has issued $146 million in EHT taxes and penalties, with the annual figure falling from $39.1 million in 2018, $41.2 million in 2019, $37.9 million in 2018, and $27.8 million in 2021.

However, actual collection of these taxes and fees is a different matter, given that there are also audits, disputes, and non-compliance. The EHT non-compliance rate has steadily fallen from 7.5% in 2017 to an initial estimate of 4.1% in 2020. So far, the municipal government has collected about $106 million in revenue from EHT, including $33.6 million in 2018, $23.3 million in 2019, $27.9 million in 2020, and $20.8 million so far in 2021.

The EHT tax rate starting in 2021 stands at 3% of the property’s assessed value — up from 1.25% in 2020, following an approved motion by Vancouver City Council to hike the rate.

City council has directed about $87 million in EHT revenues to date towards new affordable housing projects, such as this year’s allocation of $5.1 million to Vancouver Native Housing Society’s upcoming social housing project at 1766 Frances Street.

The municipal government is now accepting 2021 declarations, which are due by February 2, 2022. This should not be confused with the provincial government’s separate Speculation and Vacancy Tax (SVT), which has a 2021 declaration period of between January 18 and March 31, 2022.

Kenneth ChanKenneth Chan

+ News
+ Real Estate
+ Politics
+ City Hall
+ Urbanized
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT