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B.C. foreign real estate buyer tax leaves Iranian man set to lose thousands on first home

B.C. foreign real estate buyer tax leaves Iranian man set to lose thousands on first home

A Vancouver man waiting for his permanent resident status to be processed says he's facing thousands in unexpected costs because of a new real estate tax in B.C. 

Hamed Ahmadi came to Canada four years ago from Iran. He got a PhD from UBC and was then hired by BC Hydro as an engineer.

Wanting to build a life in Metro Vancouver, Ahmadi signed a contract in May to buy a condo in Coquitlam for $360,000 with a 10 per cent down payment — half of it to be paid right away.

"I paid $18,000 in trust and the closing date for the deal was set to be August 5 because the owner had a tenant in there," he said.

Ahmadi said he did his due diligence, looking online to figure out all the payments he would need to make. 

"I signed the contract at the time with the assumption of the laws at that time," he said.

Now, if the 29-year-old follows through with the deal, he will have to dish out $54,000 for the province's new 15 per cent tax for foreign real estate buyers.

"That's not money that people would just carry with them," he said.

The tax doesn't affect permanent residents, but Ahmadi said his PR status is still being processed; he received an email from the federal government in March saying the application is complete.

"It will probably take a few more months before it's approved and I actually receive my permanent residence card," he said.

'Any way I go, I lose'

Another option, he said, would be walking away from the deal and losing his deposit. But Ahmadi said the owner of the home has already told him a lawsuit would be waiting, because he too is closing on his own deal.

"That $18.000, I believe, is not even comparable to what I'd be sued for," he said.

"Any way I go, I lose. I don't know what to do at this point."

He only learned about the tax on Aug. 2, three days before his closing date. Panic ensued, he said, and he didn't go to work — frantically calling lawyers, realtors, banks and government officials.

"I talked to all the people that I would know who would be helpful in the government — members of parliament, I emailed them and called them. They said it's just the law [and] there's not much they can do at this point for me."

Once filled with the pride of owning a new home, he said he's now feeling hopeless and disappointed.

Hoping for change

Like many others caught up in similar situations, Ahmedi is hoping the B.C. Liberals will reconsider and adjust the details.

"What can I do? Who is out there for me to talk to, to explain that this should not be applied to me?"

He said he understands a tax targeting those who are capitalizing on the red-hot real estate market, but feels he is being wrongfully hit because the Coquitlam apartment will be his primary residence.

Ahmedi likens the situation to passing a law that forces everyone over a certain height to pay up.

"It's going to be applied to all of those people, regardless of whether they are the actual target," he said.