First-time home buyers received welcome news in the February 2014 provincial budget.
The government has announced, effective February 19, 2014, under the Property Transfer Tax (PTT) First-Time Home Buyers’ Exemption program, qualifying first-time buyers can buy a home worth up to $475,000 (previously $425,000).
The partial exemption continues and will apply to homes valued between $475,000 and $500,000.
What does it mean for the realt estate market?
More home buyers
With this change, the government estimates 1,700 additional first-time buyers will annually be eligible to save up to $7,500 in PTT when they buy their home.
The government estimates this measure will cost $8 million in lost tax revenue each year.
The Real Estate Board together with BC Real Estate Association has actively lobbied to make home ownership more affordable for first-time home buyers. This increase in the threshold clearly signals our efforts have paid off as in past years.
In 2008, as a result of industry lobbying, the provincial government increased the threshold to $425,000 from $375,000.
In 2005, the government increased the threshold to $325,000 from $275,000.
The PTT is calculated at a rate of one per cent on the first $200,000 and two per cent on the remaining value of the purchase price.
This news is a step in the right direction for all areas of real estate, whether you are a first-time home buyer, or a seller with your property on the market.