While homeowners in Vancouver complain about housing affordability and high property taxes, data shows homeowners in the city have been getting a very good deal.
In a new study from home listings site Zoocasa, the city has the lowest property tax rate among Canadian municipalities, at just above 0.24 per cent of a property’s value. In fact, according to Bloomberg, it’s the lowest property tax rate of any city in Canada or the U.S., beating out Honolulu at 0.33 per cent.
Someone who owns a million-dollar property would pay $2,468 in property taxes in Vancouver, Zoocasa estimated, compared to $6,355 in Toronto and $10,684 in Ottawa.
B.C.’s provincial government and Vancouver’s city council are working to temper house price growth. The city has introduced a school-tax surcharge on properties above $3 million, much to the chagrin of high-end homeowners. As well, the province’s foreign buyers’ tax was increased to 20 per cent this year, from 15 per cent.
All the policy changes seem to have had some effect. Home sales in Greater Vancouver fell to an 18-year low in July, as buyers took a “wait-and-see” approach to the market.
But tax rates alone don’t determine what homeowners pay; the assessed value of a home is what the tax collector uses to calculate the rate. So, to get a broader picture of who’s paying the highest and lowest taxes, one looked at the estimated bill for a typical (average or benchmark) home in each city.
Looked at this way, the numbers tell a different story. Vancouver is still relatively inexpensive, but not the least expensive.
Toronto and nearby cities are among those high on the list with Hamilton leading the country at $6,939.59 for an average-priced home.
But with any luck, homeowners won’t be paying rates quite that high. Typically, when prices spike, city council reduces the tax rate to lessen the shock to homeowners. That’s likely to happen in Ontario after the next round of property value assessments. Toronto mayor John Tory has vowed to limit property tax increases to the rate of inflation.
Other cities in the region could follow suit because homeowners could be up in arms when their homes come up for assessment and based on the high market value they can get slapped with huge tax bill.
While a high assessment helps someone, who plans on selling soon or an investor, the people hardest hit are the ones who plan on staying in their homes for a long time. The rising property prices and the high taxes is what often ends up forcing seniors living on a fixed income to put their homes up for sale. It ends up driving solid middle-class families from their homes and neighborhoods because it has become unaffordable. -CINEWS