Homeowners with vacant Vancouver properties will face a significantly steeper tax rate beginning next year after City Council unanimously voted to raise the Empty Homes Tax from 3% to 5%.

Mayor Kennedy Stewart, who initially proposed the hike, celebrated the win on Wednesday evening, tweeting that the higher tax rate would be a "big blow to housing speculators." The motion simultaneously more than doubled the number of annual audits that would be carried out to ensure compliance, bringing it up from 9,000 to 20,000 each year.

"This is how we crack down on speculators and put hardworking people first," Stewart wrote.

The Empty Homes Tax, also known as the Vacancy Tax, was introduced in 2017 in an effort to curb the number of vacant homes and encourage homeowners to put their secondary properties on the long-term rental market. The rate was initially set at 1% of the assessed value of the home, but just last year it was raised to 3%.

The tax applies to homes that are not a principal residence for at least six months of the year and are not rented out for at least six months of the year. Certain exemptions exist to this criteria, including the death of a registered owner or major renovations.

In the City Council motion, Stewart notes that as of 2021, Vancouver has one of the lowest vacancy rates in the country at just 1.1%. This is down noticeably from the 3% of Vancouver homes that were deemed vacant in the 2020 Empty Homes Tax Annual Report -- something the City believes is an indication that the tax is working.

Vancouver's tax is payable in addition to the province-wide Speculation and Vacancy Tax, which ranges from 0.5% to 2% depending on residency status as well as the year the home was purchased.