New | Vancouver tax on empty homes takes aim at near-zero rental supply

Vancouver, suffering from a near-zero supply of homes available for rent, plans to slap investors sitting on vacant properties with a new tax in an effort to make housing more accessible in Canada’s most-expensive property market.

The levy, which would start in January, may be as high as 2 per cent of the property’s assessed value, Kathleen Llewellyn-Thomas, the city’s general manager of community services, told reporters on Wednesday.

That would mean a minimum C$20,000 ($15,000) annual payment for the typical C$1 million-plus detached home in Vancouver based on July 2015 assessment data, the most recent available.

“Vancouver is in a rental housing crisis,” said Mayor Gregor Robertson, whose announcement follows a separate measure by the province in July to impose a 15 per cent tax on foreign buyers. “Dangerously low vacancy rates across the city are near zero.”

While the city, ranked the world’s third-most-livable, has drawn attention for its sky-high purchase prices fomented by global money flows, the rental market has been just as contentious locally. Vacancies can get scooped up within hours, while bidding wars drive up the cost of leases. Public scrutiny has focused on absentee landlords, particularly from overseas, who are accused of sitting on investment properties where windows remain dark throughout the year.