If house prices fall, buyers including speculators must rush into the market again, it will not take long before a new round of housing crisis and housing price will skyrocket again. The so-called real estate speculation, an important feature is the number of transactions, so to avoid real estate speculation back and forth again, the number of transactions must be limited. The purpose of the house is first to live. For the whole society, the living, not investment should be No 1 priority.
Therefore, the government must impose tax based on the number of transactions .The specific measures could be as follows:
If the new home transaction takes place in Richmond, and it's the third-time buying transaction in the last 8 years. Regardless of whether the current homeowner owns one home or multiple homes, the 'third-time buyer tax' will be levied according to the number of transactions. The transaction of pre-sale condo is also regarded as real 'transaction'.
For non-presale-condo, the tax rate is based on the assessment value of the home. For presale condo, the tax rate is based on capital gain.
Whether it is pre-sale condo or not, a progressive tax system is adopted. In other words, the more the number of transactions, the higher the tax rate will be.
The third transaction refers to the third purchase behaviour in last 8 years.
If it is the third purchase of non-presale-condo, then the tax rate is 1%; If it is the fourth purchase in last 8 years, then the tax rate is 2%. The fifth time is 3%, and so on.
If it is the third purchase of presale condo in 8 years, the tax rate is 10%;
The fourth purchase of presale condo in 8 years, the tax rate is 20%, and so on.
Although the number of transactions is self-declared, it will be severely punished if it is not declared or falsely declared.
This part of the tax will be used to subsidize homeowners who own one home only, and family annual income is less than $100,000. Because a lot of homeowners really use the house as a place for living, due to the high assessment value, they have to pay for the huge amount of mortgage and/or property taxes. Subsidies can be in the form of a home owner grant or directly deducted from property taxes.