B.C. government will not reconsider tax on foreign homebuyers, says Christy Clark

The plunge in real estate sales and deceleration inprice increases in the Vancouver area last month were exactly whatthe government was trying to manoeuvre, and Premier Christy Clarksays there will be no changes to the foreign-buyers tax.

Clark told reporters Tuesday that her government will notreconsider the 15-per-cent tax intended to calm what shecalled a "distorted market."

"The prices were going up way too fast and if we helped slowthat down, that's good," she said.

The Real Estate Board of Greater Vancouver announced last Fridaythat August sales were down by 26 per cent compared with last year,signaling a return to more typical levels.

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The largest drop in property sales last month was among detached homes, with a decrease of 44.5 per cent.

Along with the slowdown in sales, the board said prices that wereonce skyrocketing may be tapering off.

The average price of a detached home fell to $1.47 million lastmonth, a 16.7 per cent drop from the month before.

Dan Morrison,president of the real estate board, said on Friday that the regionwas seeing fewer sales of the highest-priced detached homes andfewer sales of detached homes compared with other kinds of housing,causing average prices to slump.

But the real estate board prefers to measure prices using the benchmark price, which is a representation of a "typical" property sold in the area.

The benchmark price for detached properties reached $1.57 millionin August, representing a 12-month increase of 35.8 per cent.However, compared with July, the figure was down 0.1 per cent.

More action coming?

Clark said it is too early to tell what the impact of theforeign-buyers tax and a luxury sales tax on homes priced over $2million has had on the market.

While the premier said changes to the new legislation are not anoption, the government will be doing even more to try to addresshousing affordability in Metro Vancouver.

"We need to make it easier for first-time homebuyers to getinto the market, and that's not just about price."

Housing supply is a contributing factor to the problem, Clarksaid, with prospective developments "languishing" in city planningdepartments for years.

Without giving away specifics, Clark said her government willlook at ways to ensure cities are "moving some of that inventory"and increasing supply.