Vancouver to hike empty homes tax by 25% for each of next three years

City says tax has raked in $39.7 million in net revenue since it was launched in 2016

Aerial view of houses in Oshawa, Ont., seen from a Canadian forces Hercules on Saturday, Nov. 11, 2017. The federal election results mean potential new barriers for foreign real estate investors as well as some help for first time buyer, but not the more significant changes that opposition parties had promised. THE CANADIAN PRESS/Lars Hagberg

The City of Vancouver will be raising its empty homes tax by 25 per cent for each of the next three years in an effort to tackle a crisis in the lack of long-term rental housing.

Mayor Kennedy Stewart says he has directed staff to use additional revenue from the tax hike starting in 2020 to strengthen efforts to provide affordable housing for households with an annual income of less than $50,000.

The city says the empty homes tax has generated $39.7 million in net revenue since it was launched in 2016 to fund affordable housing initiatives for tenants who face a vacancy rate that is less than one per cent.

In February, the city said statistics from 2018 showed the number of vacant properties had fallen by 15 per cent in one year and just over half of those previously empty homes had been returned to the rental market.

READ MORE: 12,000 property owners paying B.C. speculation tax so far

The city says other efforts aimed at helping renters include the opening of a community-based Renter Centre in 2021 so key organizations providing supports, education and legal advocacy can be located in one place.

Vancouver’s empty homes tax is the first of its kind in North America.

The Canadian Press

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A sold sign is shown in front of west-end Toronto homes on May 14, 2017.The Canadian Real Estate Association says home sales in July rose 12.6 per cent compared with the same month last year.The increase came as sales were up in most of the country’s largest markets, including the B.C.’s Lower Mainland, Calgary, Edmonton, the Greater Toronto Area and Hamilton-Burlington, Ottawa and Montreal.THE CANADIAN PRESS/Graeme Roy

It’s a mixed bag for newly-released real estate numbers by OMREB (file)

A real estate sold sign hangs in front of a west-end Toronto property. THE CANADIAN PRESS/Graeme Roy

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