In their respective state budgets New South Wales, Queensland and Victoria all instituted some mix of higher stamp duty or land tax rates for foreign buyers of residential real estate, with Victoria’s 7% stamp duty surcharge the largest increase levied against offshore buyers.
Those moves were criticised by many at the time and are estimated to add tens of thousands of dollars to the price foreign buyers pay for real estate in the country, but they pale in comparison to moves made in Canada.
According to a report in The Canadian Press, British Columbia Finance Minister Mike de Jong has introduced legislation that will see foreign buyers pay an additional property transfer tax of 15% on purchases in metropolitan Vancouver.
The additional tax will come into force from 2 August and according to de Jong would see a C$2m dollar property come with an extra tax bill of $300,000.
According to de Jong, foreign investors purchased C$1b of real estate from 10 June to 14 July this year.
While de Jong’s new tax may dwarf those instituted in Australia, the sentiment around foreign buyers is similar in both countries.
Earlier this year it was claimed Chinese investors alone had purchased C$21.7b worth of real estate in Toronto and Vancouver in 2015 and that the Canadian government had done little to accurately track the scope and impact of foreign buyers, with many Canadians believing they have fuelled rising house prices.
In Australia, foreign buyers have been widely targeted as the reason behind rising house prices, particularly in markets like Sydney and Melbourne and government agencies have significantly strengthened their monitoring of the sector.