BC expands speculation and vacancy tax to include Penticton, Summerland

British Columbia’s speculation and vacancy tax (SVT) is expanding into several new communities.

The tax aimed at fighting real estate speculation and turning empty units into homes for British Columbians will include 13 new municipalities in 2025.

That includes both Penticton and Summerland here in the South Okanagan, along other Okanagan spots like Peachland, Lake Country, Vernon and Coldstream.

Other cities being added are Kamloops, Salmon Arm, Courtney, Comox, Cumberland, Parksville and Qualicum Beach.

"There is a housing crisis across the country and it is creating economic challenges, including people feeling pushed out of their communities and labour shortages," said Katrine Conroy, Minister of Finance.

"With so many people struggling to find secure housing, we have to keep taking action - we can't afford to pull back. The speculation tax is one of the ways we can help increase affordable housing options for people and communities."

Residential property owners in these places will need to declare for the first time in January 2025 based on how they used their property in 2024.

The Province says that will give owners in these new areas ample time to decide how to meet exemption requirements before these changes take effect.

Exemptions to the SVT include primary residences, properties with a long-term tenant and life events, such as separation and divorce.

Penticton Mayor Julius Bloomfield said in a statement that city council just found out this news today and it was "extremely disappointing" that it was made with no consultation.

“While this council shares the province’s goals of addressing the need for affordable housing as demonstrated by the work of our housing task force, we question the province’s lack of recognition of Penticton’s unique needs," he explained.

"That this unilateral decision to expand the SVT to our community has come at the same time we’re still trying to understand the consequences of the changes to the short-term regulations is especially concerning."

Bloomfield said council is worried about the unintended consequences of this move and will be seeking more information from the Province on how the decision was reached.

According to the Province, expanding the SVT is part of BC’s Homes for People plan, which includes actions to fight speculation and speed up the delivery of new homes for British Columbians.

An independent review released in 2022 found that the tax helped deliver more than 20,000 homes in Metro Vancouver alone when it was first introduced.

With the addition of six new communities for the 2023 tax year and another 13 for the 2024 tax year, the SVT will apply to a total of 59 BC communities.