When Vancouver native Gabrielle Phyo and her husband searched for a home on Bowen Island, B.C. earlier this year, little did they realize that the money they set aside as a down payment would be insufficient in just a matter of months.

Phyo and her husband, a British citizen, were just steps away from buying a home and relocating from the U.K. back to Canada when they found out they would have to pay a 15 per cent tax on half of the home’s price.

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BNN's 'House Money' debuts Tuesday at 5:30 p.m. ET (2:30 p.m. PT).

That would have slapped on another $125,000 to the cost, Phyo said.

Phyo, who was born and grew up in Vancouver, is not the only one facing the additional unexpected cost of home ownership. On Aug. 2, the B.C. government introduced a 15 per cent property transfer tax on home purchases made by all foreign nationals in the Vancouver area.

According to the B.C. government, the additional property transfer tax applies on the foreign entity’s proportionate share – in this case, Phyo’s husband. For example, if the home were jointly owned by both parties, with the foreign entity owning 50 per cent, the additional property transfer tax would apply on 50 per cent of the home’s value.

When the new rules were introduced, the province said the new tax measures were aimed at addressing the lack of rental supply and improving the city’s housing affordability, which the government attributes to a rush of foreign capital that has caused home prices in Vancouver to surge.


Phyo met her husband while studying and working in the U.K., and the couple lived in Gloucestershire – about two hours west of London – for almost a decade. They decided it was the right time to move themselves and their two kids back to Vancouver.

“All my family is in Vancouver – it’s home to me. We have two small children. I wanted to raise them in Canada, so we started looking around for homes in the Bowen Island area. It was relatively more affordable than being closer to Vancouver’s downtown,” said Phyo, in an interview with Greg Bonnell, on BNN’s new show House Money, debuting tonight at 5:30 p.m. ET (2:30 p.m. PT) and replaying at 7 p.m. ET and 9 p.m. ET.

Phyo, a lawyer, and her husband, a pilot, hunted for homes in the $1.5- to $2-million range in Bowen Island, located approximately 30 minutes away from Vancouver’s downtown core.

However, the couple learned that they would have to pay the B.C. foreign buyer tax on half of the home’s value if Phyo’s husband’s name was included on the mortgage title.

The additional $125,000 was just too much.

“We just couldn’t afford it. Vancouver homes are already extremely expensive, and we had to take out a mortgage. The additional amount we have to pay on the tax is almost like having to come up with a second down payment,” said Phyo.

“We would not be able to take out a big enough mortgage to afford a regular three-bedroom home in Bowen Island if it was just my name and my income on the mortgage,” said Phyo.


The B.C. government has no plans to grant exceptions, and Premier Christy Clark said earlier this month that she won’t back down on the tax that’s intended to calm a “distorted market.” 

“Any time a new tax is implemented there is a period of market distortion, and if the tax is effective some people will find themselves adversely affected,” a spokesperson for B.C.’s Ministry of Finance said in an email response to BNN.

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B.C. Premier Christy Clark and Finance Minister Michael de Jong in July. (The Canadian Press)

“This is about helping manage ongoing foreign demand in residential real estate while the market responds by building new homes to meet local needs.”

Vancouver home sales plummeted 26 per cent in August, compared to the same month a year earlier, according to the latest figures from the Real Estate Board of Vancouver.

Yet, that drop in sales activity likely was not due to the foreign buyers’ tax, according to a report by Capital Economics.

“Home sales were down an even larger percentage in July, before the foreign buyers’ tax was instituted. These trends support the idea that it is debt, and not foreign money that is inflating a housing bubble across Canada,” Capital Economics said.

Phyo said she believes there’s a harsh irony in the implementation of the foreign buyers’ tax.

B.C.’s move largely aimed to clamp down on foreign speculation to improve affordability in Vancouver’s housing market. But in looking to settle back in her home province, Phyo and her family have become collateral damage.

Phyo said they plan to stay in the U.K. now that a home in Vancouver has become out of reach.

“We’re not the target of the tax,” Phyo said. “We’re just a family looking to move back to Vancouver, and reside in the home that we bought. Now that dream is gone.”

DON'T MISS: Gabrielle Phyo's interview on BNN’s House Money, when it debuts tonight at 5:30 p.m. ET (2:30 p.m. PT). The show will be replayed at 7 p.m. ET and 9 p.m. ET.