{"id":8924,"date":"2018-04-26T10:10:12","date_gmt":"2018-04-26T17:10:12","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=8924"},"modified":"2018-04-25T16:15:46","modified_gmt":"2018-04-25T23:15:46","slug":"government-cracking-down-on-tax-evasion-in-bcs-pre-sale-condo-market","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2018\/04\/government-cracking-down-on-tax-evasion-in-bcs-pre-sale-condo-market\/","title":{"rendered":"Government Cracking Down on Tax Evasion in BC&#8217;s Pre-Sale Condo Market"},"content":{"rendered":"<p style=\"text-align: justify;\">On Tuesday, BC\u2019s Minister of Finance Carole James announced a government crack down on tax evasion in pre-sale condo assignments, in an effort to address the province\u2019s housing crisis. However, Vancouver-based real estate consultant and architect Michael Geller says the new government rules could make the situation worse by reducing demand from investors.<\/p>\n<p style=\"text-align: justify;\">If approved by the legislature, the new amendments to the Real Estate Development Marketing Act will require developers to collect and report information on pre-sale condo assignments to ensure buyers are paying the appropriate taxes.<\/p>\n<p style=\"text-align: justify;\">\u201cIt may take investors out of the market, especially those whose primary motivation was to flip the agreement before they closed. The net result may be a number of projects being put on the back burner because they can\u2019t achieve their pre-sale targets demanded by the bank,\u201d Geller tells BuzzBuzzNews.<\/p>\n<p style=\"text-align: justify;\">Pre-sale condo assignments are a common occurrence in Vancouver. An assignment refers to a transaction that involves the owner of an unbuilt property selling the pre-sale contract to another buyer, while in turn making capital gains off the property\u2019s increased market value. Although developers keep records of pre-sale condo assignments, the sales are not registered with the City and no property transfer taxes are paid.<\/p>\n<p style=\"text-align: justify;\">\u201cFor too long, people who resell condos before they have been built have been inflating real estate prices, without necessarily paying taxes on their gains,\u201d says James, in a press release.<\/p>\n<p style=\"text-align: justify;\">Geller agrees that pre-sale condo assignments should be monitored, as they are a likely contributor to skyrocketing prices in Vancouver.<\/p>\n<p style=\"text-align: justify;\">\u201cFar too many people have been reaping capital gains on assignment or flipping of condo pre-sales without paying tax. And I actually do think it has contributed to price escalation particularly because there still is an imbalance between supply and demand in Vancouver,\u201d says Geller.<\/p>\n<p style=\"text-align: justify;\">However, if investors are taken out of the market, Geller says some developers might have to halt project construction due to a lack of buyers.<\/p>\n<p style=\"text-align: justify;\">In addition, these new rules probably won\u2019t do much to reverse the province\u2019s mounting affordability woes. But, Geller does believe they may increase tax revenue.<\/p>\n<p><a href=\"http:\/\/news.buzzbuzzhome.com\/2018\/04\/tax-evasion-bcs-pre-sale-condo-hamper-supply.html\" target=\"_blank\" rel=\"noopener\">Cracking Down on Tax Evasion in BC&#8217;s Pre-Sale Condo Market Could Hamper Housing Supply<\/a> by Kerrisa Wilson | Buzz Buzz Home<\/p>\n","protected":false},"excerpt":{"rendered":"<p>On Tuesday, BC\u2019s Minister of Finance Carole James announced a government crack down on tax evasion in pre-sale condo assignments, in an effort to address the province\u2019s housing crisis. However, &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2018\/04\/government-cracking-down-on-tax-evasion-in-bcs-pre-sale-condo-market\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-8924","post","type-post","status-publish","format-standard","hentry","category-real-estate"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Government Cracking Down on Tax Evasion in BC&#039;s Pre-Sale Condo Market &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2018\/04\/government-cracking-down-on-tax-evasion-in-bcs-pre-sale-condo-market\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Government Cracking Down on Tax Evasion in BC&#039;s Pre-Sale Condo Market &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"On Tuesday, BC\u2019s Minister of Finance Carole James announced a government crack down on tax evasion in pre-sale condo assignments, in an effort to address the province\u2019s housing crisis. 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