Late last week, the City of Vancouver announced details of its
plans to tax vacant residential properties, which plans are part of
its efforts to address the low rental vacancy rate and high cost of
renting in the City.
At the end of July, the British Columbia government announced
that it would be amending the Vancouver
Charter1 to pave the way for the City of Vancouver
to impose a "vacancy tax" on owners of unoccupied homes
in the City of Vancouver. The amendments leave it up to the
City to define the circumstances in which a residential property is
considered to be unoccupied, set the rate or amount of the tax, set
out the procedure for determining if a property is unoccupied, and
establish other requirements, penalties and exemptions.
On Wednesday, September 14, Vancouver Mayor Gregor Robertson
held a press conference to announce details of the proposed tax
by-law, following the publication of a staff report to City council
which sets out potential approaches and makes recommendations for
the tax (available here). It is expected that City council will
approve the approach set out in the staff report this week, and
begin public consultations in October. The City aims to have the
tax in place for 2017, so that it will begin receiving revenue from
the tax by 2018.
The tax will apply to both single family homes and to
residential strata units that are not the principal residence of
the owner, a long-term tenant or a family member of the owner. The
report recommends that the tax be levied as a percentage of the
assessed value of the property, at a rate between 0.5% and 2%, a
rate it says is high enough to incentivize owners to rent out or
occupy their homes. Any revenue from the proposed tax will be
applied to affordable housing initiatives in the City.
The City will administer the tax using what it calls a
"self-declaration, audit and complaint response", which
requires homeowners to declare annually that the property is their
principal residence or that of a long-term tenant or family member.
The City will also use random audits and targeted audits based on
complaints. The amendments to the Vancouver Charter
empower the City to compel owners to provide evidence to support
their property status declarations and impose penalties for failing
to make a declaration or making a false declaration.
The length of time homes must be vacant to attract the tax will
be settled through public consultation this fall. The exemptions
will also be defined through the public consultation process, but
are expected to include properties that are in probate, subject to
rental restrictions, going through renovations or changing
These changes are part of the series of reforms in the
Miscellaneous Statutes (Housing Priority Initiatives) Amendment
Act, 2016, which are in response to growing concern over the
housing affordability crisis resulting from escalating home prices
and low vacancy rates in the Greater Vancouver area. The
changes also include the foreign buyers' tax, which we
here, and dispensing with the self-regulation of realtors,
previously reported on
We will be monitoring these developments ?and be sure to keep
our readers updated.
A typical commercial lease is not a balanced document in terms of rights and remedies for a breach of the lease. There will be long list of tenant defaults that will give the landlord a full range of remedies.
In the recent decision, Ross-Clair v. Canada (Attorney General) the Ontario Court of Appeal reaffirmed and clarified the necessity to follow the provisions in a construction contract to properly advance a claim for compensation in excess of the contract price.
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