That amounts to 8.2% of detached homes in Vancouver are unoccupied or owned by temporary or foreign residents. In Surrey the unoccupied number is 11,195 (6.2%), Burnaby 5,829 (5.9%) and Richmond 4,021 (5.6%). So combined, the other municipality's numbers are still less than the total unoccupied properties in Vancouver. This constitutes nothing short of a phenomenal distortion of normal domestic market forces which should be the primary driver of local home prices. But this simply isn't the case.
Vancouver specifically and Greater Vancouver in general have become a dumping ground for foreign investors and by foreign investors I chiefly mean mainland Chinese looking desperately to get their money of of China. This trend in Vancouver is clearly heading up as evident from the fact that in 1986 the unoccupied homes was around 4%. Now the semantics of what constitutes an unoccupied property is up for debate. However, it is unanimously agreed that the unoccupied home numbers are up significantly no matter how you define “unoccupied”.
In response to this trend, the Vancouver City Council voted to approve an “empty homes” tax back in November of 2016, the first of its kind in Canada. This tax requires owners to “self-report” that their property is not their principal residence or not rented out for at least 6 months of the year. Consequently, after “self-reporting” property owners will be charged a 1% charge on those properties (1% of the property value). With Vancouver's rental vacancy rate at 0.6% more rental inventory is definitely needed. Despite the fact that some real action is necessary here, it's interesting how governments always resort to imposing some kind of new tax to deal with the problem. And yet, are legitimate home owners property taxes going down as a result of this additional revenue? Of course not.
Rumours are circulating that some of these property owners are now allowing people to stay in these houses rent free but must pay for hydro, cable and other expenses to demonstrate that the property is indeed occupied, thereby avoiding the 1% tax. On a vacant $2 million home then the tax could amount to $20,000.
When money sheltering is more important than property value appreciation, generating revenue, property maintenance, any effort to actually fit into your new society/neighbourhood or any attempt to foster some kind of community spirit, then I guess this strategy makes sense – well, sort of! You be the judge.