British Columbia’s Minister of Finance, Katrine Conroy, has announced that the new BC Home Flipping Tax (HFT) will officially take effect on January 1, 2025. This tax targets home flipping activity and short-term speculation, applying even to properties purchased before the implementation date.
The tax will be applicable to residential properties sold within two years of purchase, with sellers facing up to a 20% tax on their income from the sale. The tax rate will start at 20% for properties sold within the first year and gradually decrease to 0% over the second year.
The HFT aims to address housing affordability concerns by discouraging speculative activity, where properties change hands frequently for quick profits, driving up home prices. Exemptions will be provided for certain life events and for those adding to the housing supply.
The revenue generated from the HFT, estimated at $11 million for the 2024/2025 fiscal year and $43 million for subsequent years, will be directed towards funding new affordable housing for middle-income households.
This tax is part of the provincial government’s broader efforts to intervene in the housing market, following the introduction of the Speculation and Vacancy Tax. Additionally, new Property Transfer Tax exemptions will be introduced to improve housing affordability for first-time homebuyers.
