VANCOUVER (NEWS1130) – Vancouver is one of many cities grappling with the issue of what to do about foreign-owned condos that sit unoccupied.
New York City is mulling over a special property tax for owners who don’t live there.
They’re calling it the pied a terre tax. In this case, owners would pay 0.5 to 4 per cent of the market value of their property if they don’t call New York City their primary home.
This would only be on properties worth $5 million or more.
Tsur Sommerville, director of the UBC Centre for Urban Economics and Real Estate with the Sauder School of Business, doubts a tax like this would deter anyone with enough money to have a second home from buying.
“People who are willing to let say, a condo building that could be making $1,500 a month in rent stand vacant are not necessarily going to be dissuaded even by the doubling of their property tax.”
But he says the funds could help those hurt by foreign ownership.
“At least you’re making the connection between the harm, increased demand for real estate and the effect on prices, with those most affected by it — those on low income.”