September 1 2026

More Taxes. More Restrictions. Same Affordability Problem.

Over the past decade, BC and the federal government have introduced a series of policies aimed at making housing more affordable and accessible for people who actually live here. The foreign buyer ban. The speculation and vacancy tax. The mandatory minimum down payment requirements for non-residents. On paper, these measures were designed to cool an overheated market, free up empty homes, and put the brakes on speculative buying.

But years later, homes in Metro Vancouver are still among the most expensive in the world. So the natural question is — did any of it actually work?

The honest answer is: some of it did, some of it didn’t, and the reasons why tell you a lot about how complicated the housing problem really is.

The Foreign Buyer Ban

The federal Prohibition on the Purchase of Residential Property by Non-Canadians came into effect in January 2023. The idea was straightforward — restrict foreign ownership of residential property to free up supply and improve affordability for Canadian buyers. The ban was extended in February 2024 and now runs until January 2027.

The problem is that by most accounts, it hasn’t moved the needle on affordability in any meaningful way. Royal LePage was direct about it — the ban has had “virtually no impact” on housing prices. The reason is fairly simple in hindsight: foreign buyers were already a very small part of the market. By 2024, foreign ownership accounted for roughly 1% of Canadian real estate transactions. You can’t solve a large supply and demand problem by restricting a group that was never driving it in the first place.

There’s also an unintended consequence worth paying attention to. BC developers have been vocal about the fact that the ban has slowed new housing construction — not just for foreign buyers, but overall. New housing starts in BC dropped by nearly 50% between March 2024 and March 2025. Condo and multi-family starts are down significantly province-wide. When foreign investment in new development dries up, projects don’t get built, and the supply problem gets worse, not better.

The federal ban set out to solve an affordability crisis. But it targeted a relatively small piece of the puzzle while leaving the bigger structural issues — lack of supply, slow permitting, high construction costs — largely untouched.

The Speculation and Vacancy Tax

This one has had more of an effect — though not necessarily in the way most people expected.

The BC speculation and vacancy tax was introduced in 2018 and targets homeowners who leave properties empty or who don’t report income in Canada. Since it was introduced, it has raised over $550 million in total revenue, with $79.6 million collected in 2024 alone. That money goes directly toward affordable housing initiatives in the regions where the tax applies.

More importantly, the tax has changed behaviour. Owners who previously left properties sitting empty have moved in, rented them out, or sold them rather than pay the annual levy. That’s exactly what it was designed to do — and by that measure, it has worked.

In 2026, the rates are going up. Foreign owners and those who earn most of their income outside Canada will now pay 3% of their property’s assessed value annually — up from 2%. Canadian citizens and permanent residents who don’t qualify for an exemption will pay 1%, up from 0.5%. The homeowner tax credit is also doubling from $2,000 to $4,000 to provide some relief for local residents who don’t qualify for the standard exemptions.

Whether these higher rates lead to meaningfully more supply coming onto the market remains to be seen. But the direction of the policy is clear — the province is serious about discouraging empty homes, and the consequences of leaving a property unused are becoming harder to ignore.

The Down Payment Requirements for Non-Residents

One of the less talked about tools in BC’s housing policy toolkit is the mandatory minimum down payment requirement for foreign and non-resident buyers. While Canadian residents can purchase a home with as little as 5% down on properties under $500,000, non-residents face a significantly higher bar.

Foreign nationals looking to purchase in Canada are generally required to put down a minimum of 35% of the purchase price. On top of that, non-resident buyers are not eligible for CMHC mortgage default insurance — meaning every non-resident mortgage is a conventional, uninsured loan. Lenders also apply a rate premium of between 0.25% and 0.50% higher than what Canadian residents pay, and scrutinize the source of funds far more carefully under Canada’s anti-money laundering regulations.

The intent behind these requirements was clear — by making it more financially demanding for foreign buyers to enter the market, the government hoped to reduce speculative purchasing and ease pressure on housing supply for local buyers.

In practice, the impact has been mixed. For buyers with significant capital, a 35% down payment is a barrier — but not necessarily a dealbreaker. And given that foreign buyers were already a small fraction of the overall market, the down payment rules — like the foreign buyer ban — have had a more limited effect on overall affordability than originally hoped. Where they have made a difference is in reducing highly leveraged foreign investment in the market, which was a genuine concern in the years leading up to these policies being introduced.

So What Does Actually Move the Needle?

The policies above have each had some effect — but the honest takeaway from years of data is that demand-side measures alone can’t fix a supply problem.

Vancouver doesn’t have an affordability crisis primarily because of foreign buyers or empty homes. It has an affordability crisis because there aren’t enough homes for the number of people who want to live here, building costs are high, permitting is slow, and the geography of the region limits where new density can go.

The measures that are most likely to have a lasting impact are the ones focused on supply — like BC’s Bill 44, which now allows multiplexes on single-family lots across the province without rezoning. It’s less headline-grabbing than a foreign buyer ban, but it addresses the root of the problem in a way that taxes and restrictions simply can’t.

For buyers and sellers navigating the market today, this context matters. The policies that exist provide some protection against speculation and empty properties — but they haven’t fundamentally changed the supply and demand reality that drives Vancouver’s market. Prices are still high. Inventory, while better than it was, is still tight in the most desirable areas. And the path to affordability for most people still runs through the same place it always has — careful planning, realistic expectations, and a clear understanding of what the numbers actually allow.