Vacancy taxes put more apartments for rent in the Vancouver metro market: CMHC study – BC News

Photo: The Canadian Press

Construction cranes tower above condominiums under construction near False Creek in southeast Vancouver on February 9, 2020. A study by Canada Mortgage Housing Corp. says more than 11,000 condos were added to the housing pool in the Vancouver metro last year , partly stimulated empty houses. THE CANADIAN PRESS / Darryl Dyck

Canada Mortgage Housing Corp. says more than 11,000 condos were added to the rental market in Metro Vancouver last year, in part spurred by taxes on empty homes.

The CMHC report was released as the Vancouver board voted Wednesday to raise the vacancy tax from 1.25% to 3% for next year.

The study says that of the 11,118 units, 2,294 were new condos and were rented by investors, while 8,824 were used by owners for another purpose and are now being offered as long-term rentals.

He says speculation and the BC government vacancy tax, Vancouver’s vacancy tax, and the city’s new requirements affecting short-term rentals have also contributed to the increase in the number of rental apartments.

However, the report says that the added units have not surpassed the strong demand and the vacancy rate in the Vancouver metro remains at or below one percent, where it has been for six consecutive years.

It says the COVID-19 pandemic will hit the market, and condo owners who rent their units for short-term vacations may want more stable income from long-term rentals.

Mayor Kennedy Stewart has proposed raising the vacancy tax.

“This revolutionary tool has helped bring thousands of homes back to the rental market … but there are still too many homes that remain empty,” Stewart said in a statement. “By tripling the tax from 1 to 3% since the tax was launched, we are sending an even stronger message that homes are for the people, not speculation.”