Vancouver Wields C$10,000-a-Day Fine in Crackdown on Empty Homes

[casper]

Originally Posted by Spork

You don't need to get a letter if you are not audited.

And for the record, there are lots of restrictions on how one's personal property can be used, so this is no more of an intrusion than the city telling you that you cannot have a pub in your home, have any more than 5 unrelated persons living together in your home, or not operating a B&B in your home.

I agree that the paltry 1% won't do anything to decrease the demand for land banking in this city, but what if it does? That's great. If it doesn't? Maybe they will raise the tax to 5% next year or take other substantial, meaningful steps to making this city more affordable.

In the cases where the city is in intruding on personal property rights it should be based on public safety of to minimize the impact one property has on the neighborhood.

I would have thought land banking and accumulation would be a positive for the city housing stock. You accumulate neighboring property, bulldoze and then build a 4-40 story building. Why would any administration concerned about increasing the housing stock every want to try to discourage that behavior.

[s211]

Originally Posted by whatnext

Is there a snitch line (there should be).

Having just watched a documentary on the stasi, I find your comment rather disturbing.

And I'm also wondering about the magnitude of the fine. Trust me, I can't afford even 10% of one day's fine, but $10K a day? I can't wait to see a legal challenge regarding the unreasonableness of that magnitude. It's clearly into high punitive ranges, beyond justifiable amounts.

[whatnext]

Originally Posted by s211

Having just watched a documentary on the stasi, I find your comment rather disturbing.

And I'm also wondering about the magnitude of the fine. Trust me, I can't afford even 10% of one day's fine, but $10K a day? I can't wait to see a legal challenge regarding the unreasonableness of that magnitude. It's clearly into high punitive ranges, beyond justifiable amounts.

I think it's a bit of a stretch to equate the bylaw officer schlub Gregor would be sending to check on your house with the Stasi.

[Changing City]

Well, this is interesting.

98.85% of homeowners filled out the empty tax declaration. The 1.15% who didn't (that's 2,132 homes) are about to be sent a tax notice that assumes that their property is vacant. There's still an appeal process if it's actually occupied, or any of the other clauses apply that mean the vacant property tax doesn't apply.

"A total of 8,481 residential properties were declared or deemed to be unoccupied/under-utilized for more than 180 days in 2017. This figure not only includes properties that were declared vacant, but also properties that claimed one of the various exemptions to the tax. Properties can be eligible for an exemption based on a number of reasons, including if the property was undergoing renovation or redevelopment, title transferred during the year, or the owner was residing in a hospital, long term or supportive care facility."

That means 6,349 homes were vacant, but an unstated number are exempt from paying the tax. There's a report coming in the fall that will have the final numbers.

This is way fewer vacant homes than either the census, or other estimates have previously suggested. It's quite possible that there are people who have a 'vacant or underutilized' home, but said it was occupied. They're not necessarily off the hook: "The Empty Homes Tax audit program is underway. Using a risk-based approach, as well as random audits, the program has a goal of verifying property status declarations and encouraging compliance with the new tax."

[WarrenC12]

^^^^ Of course people are lying. I wonder what the penalty for that is.

[Changing City]

Originally Posted by WarrenC12

^^^^ Of course people are lying. I wonder what the penalty for that is.

I believe there's a hint in this thread's title ... "False declarations will result in fines of up to $10,000 per day of the continuing offense, in addition to payment of the tax." (The tax is 1% of the home's assessed value).

[casper]

Originally Posted by Changing City

I believe there's a hint in this thread's title ... "False declarations will result in fines of up to $10,000 per day of the continuing offense, in addition to payment of the tax." (The tax is 1% of the home's assessed value).

Perhaps they are. However the problem with the audit process is the sentence quoted from the mayors blog post:

"whether property owners can provide sufficient evidence to support their declarations"

Does anyone else find it odd, that the home owner is expected to provide they are not making a false declaration and it is not the other way around that it is the inspect that has to prove the law was broken? It just sounds backwards.

[whatnext]

Originally Posted by casper

Perhaps they are. However the problem with the audit process is the sentence quoted from the mayors blog post:

"whether property owners can provide sufficient evidence to support their declarations"

Does anyone else find it odd, that the home owner is expected to provide they are not making a false declaration and it is not the other way around that it is the inspect that has to prove the law was broken? It just sounds backwards.

Yeah, given how we've heard here how understaffed the development permit staff is, I'm not convinced the city will actually devote sufficient resources to enforcement. It's pretty clear to me that a lot of respondents answered the census truthfully as it was before an empty homes tax was suggested. Very few people will voluntarily admit to taxation in this case, especially if you've already lied to get the money here.

[Changing City]

Originally Posted by whatnext

Yeah, given how we've heard here how understaffed the development permit staff is, I'm not convinced the city will actually devote sufficient resources to enforcement. It's pretty clear to me that a lot of respondents answered the census truthfully as it was before an empty homes tax was suggested. Very few people will voluntarily admit to taxation in this case, especially if you've already lied to get the money here.

That's not how the census works though. Statistics Canada identify all the possible property addresses they can find, and if they don't receive a census return, they consider it unoccupied. So it may well be that the census is less accurate. More likely it's a bit of both - the census missed some homes that were actually ocupied, and the vacant homes returns to the City have some dubious claims of occupation to try to avoid the tax.

Don't forget the comments earlier of how owners were scambling to lease or make other arrangements to ensure they didn't have to pay the tax. The census was nearly two years ago, so things will have changed.

[twoNeurons]

It's pretty easy to just start renovating to avoid this tax. Just choose a room, and paint one wall a different color. Leave some paint buckets in the room while you're not using the property and voilá.

If it's a vacant home that you're not using at the moment, who cares if there's some paint buckets lying around.

I wonder if there are stipulations regarding what consists of a renovation.

Either way, the whole thing is silly. If you want to make more people less than Air BnB it's pretty easy just to pass a law taxing AirBnBs.

Say that there is a 50% tax on all income coming in to have a place on AirBnB and offer monetary rewards for reporting those that are infringing. A whole suite of places will open up after that.

Note that I'm not SUGGESTING that they do this, but doing that would have WAY more effect than looking for empty homes and forcing people to rent them out.

[retro_orange]

Vancouver council to vote on looking at increase to Empty Homes Tax

Simon Little 23 hrs ago

Vancouver Mayor Kennedy Stewart is taking what could be the first steps toward his campaign promise of tripling the city's Empty Homes Tax (EHT).

In September, Stewart unveiled the promise to hike the tax rate to three per cent as one of the key planks in his housing platform.

Vancouver's EHT currently applies a one per cent tax on the assessed value of homes deemed to be vacant for more than six months per year, barring specific exceptions.

Stewart is now bringing a motion to council asking city staff to dig into the practicalities and possible repercussions of increasing the tax.

The motion calls on staff to develop a plan by March that would "review and improve the fairness and effectiveness of the Empty Homes Tax in achieving the objective of returning empty and underutilized properties to the market."

In doing so, it asks staff to "review the fairness and effectiveness of exemptions and definitions, considering as well the Provincial Speculation Tax definitions."

Under the EHT's current form, nearly 5,400 of the more than 7,900 homes deemed "vacant" were able to make use of exemptions to the tax.

Stewart's motion also asks staff to develop a proposed timeline for information on the impact of increasing the tax rate, along with possible program benefits and drawbacks.

Finally, it calls for recommendations on how to consult the public and conduct further internal analysis.

In November, the City of Vancouver said that in its first year, the EHT was expected to bring in about $38 million, $8 million above its initial estimate.

The tax is meant to encourage homeowners to rent out vacant properties, thus increasing the stock of available rental.

Last fall, the Canada Mortgage and Housing Corporation's (CMHC) 2018 rental market report for the city found the city's vacancy rate had declined from 0.9 per cent to 0.8 per cent year-over-year.

That same report found the average rent for a two-bedroom apartment had climbed in one year from $1,860 to $1,964.

Stewart's motion goes to council on Tuesday.

https://globalnews.ca/news/4887432/v...-tax-increase/

[WarrenC12]

2% to 3%?

My reaction is "meh", but if he made this part of his platform, it's reasonable that he brings it forward. Whether it will get the votes in this mixed bag of a council, who knows.

[misher]

Originally Posted by WarrenC12

2% to 3%?

My reaction is "meh", but if he made this part of his platform, it's reasonable that he brings it forward. Whether it will get the votes in this mixed bag of a council, who knows.

Results from the empty home tax were dismal. It was supposed to increase rental supply yet nothing has shown that it made a difference. Instead there advertising the money raised as if $30 million ($15 after costs of the first year) will have an impact. Also I wonder how much of this was from developments waiting for permits.

I imagine it won’t pass and this is a PR ploy.

[retro_orange]

Originally Posted by WarrenC12

2% to 3%?

My reaction is "meh", but if he made this part of his platform, it's reasonable that he brings it forward. Whether it will get the votes in this mixed bag of a council, who knows.

My reaction to that marginal increase was the same, thus not highlighting it. (I still prefer to post the entire story so readers can get a better idea than just a few random sentences or paragraphs that you then have to go to the website and defeat any subscription or 'ad-block' blocking to get the full scope of the article) What I found notable is the revision of exemptions to the tax.

Under the EHT's current form, nearly 5,400 of the more than 7,900 homes deemed "vacant" were able to make use of exemptions to the tax.

That's a huge chunk of vacant properties that are still vacant and untaxed. It shows the implementation was sloppy almost to the point of intentional by Vision making them appear to do something about the issue but still letting most off the hook.

[WarrenC12]

Originally Posted by retro_orange

That's a huge chunk of vacant properties that are still vacant and untaxed. It shows the implementation was sloppy almost to the point of intentional by Vision making them appear to do something about the issue but still letting most off the hook.

I think the exemptions are valid reasons, unless you are implying that people are lying, in which case that's more about enforcement.

[whatnext]

Karma is sweet!


Vancouver levies empty homes tax against owner of property with breached aquifer
Vancouver still seeking more than $10.5 million in cleanup costs from the owner, whose contractors breached an aquifer.

A $21,100 charge will be added to Feng Lin Liu’s alleged debts if the West Side property owner fails to submit his empty homes tax declaration to the City of Vancouver.

Liu is the owner of 7084 Beechwood St., where engineers are one final test away from completing a $10.5-million project to cap a breached aquifer that gushed water for almost two years at a clip of up to two million litres a day. Geothermal drillers with Geoenergia Projects hired by Liu left the country after they breached the aquifer and the city stepped in to manage the cleanup.

Last week, Geoenergia’s Armando and Tommaso Mascetti failed to appear in court to face several charges under the provincial Water Act related to the incident. Those charges include diverting more water than authorized and failure to control an artesian well....

https://vancouversun.com/news/local-...eached-aquifer

[misher]

Originally Posted by whatnext

Karma is sweet!


Vancouver levies empty homes tax against owner of property with breached aquifer
Vancouver still seeking more than $10.5 million in cleanup costs from the owner, whose contractors breached an aquifer.

A $21,100 charge will be added to Feng Lin Liu’s alleged debts if the West Side property owner fails to submit his empty homes tax declaration to the City of Vancouver.

Liu is the owner of 7084 Beechwood St., where engineers are one final test away from completing a $10.5-million project to cap a breached aquifer that gushed water for almost two years at a clip of up to two million litres a day. Geothermal drillers with Geoenergia Projects hired by Liu left the country after they breached the aquifer and the city stepped in to manage the cleanup.

Last week, Geoenergia’s Armando and Tommaso Mascetti failed to appear in court to face several charges under the provincial Water Act related to the incident. Those charges include diverting more water than authorized and failure to control an artesian well....

https://vancouversun.com/news/local-...eached-aquifer

? This seems like a stupid use of the tax as how is levying it helping to push this home back on the rental market. Its like levying the empty home tax on a building that just burned down, whose supposed to inhabit it, homeless people in tents?

Anyway the Owner and the contractors seem to have fled so we're on the hook for it.

[Alex Mackinnon]

Originally Posted by misher

? This seems like a stupid use of the tax as how is levying it helping to push this home back on the rental market. Its like levying the empty home tax on a building that just burned down, whose supposed to inhabit it, homeless people in tents?

Anyway the Owner and the contractors seem to have fled so we're on the hook for it.

Don't be so sure that the city is out the entire cost. The house and all the assets of the drilling company probably will be sold off to pay the debts. Thankfully the property should be worth a fair amount.

[Migrant_Coconut]

Originally Posted by Alex Mackinnon

Don't be so sure that the city is out the entire cost. The house and all the assets of the drilling company probably will be sold off to pay the debts. Thankfully the property should be worth a fair amount.

Sounds great, so long as it's not overreach. It's the Empty Homes Tax after all, not the Empty Homes Liquidation Bylaw.

[misher]

Originally Posted by Migrant_Coconut

Sounds great, so long as it's not overreach. It's the Empty Homes Tax after all, not the Empty Homes Liquidation Bylaw.

Bank likely has #1 priority and with the market down who knows if they will get the mortgage plus fees back.