Residential property flipping in British Columbia, 2019 to 2021

Released: 2024-11-26

In recent years, several public policy measures have been introduced to address the short-term holding of property for profit, commonly known as "property flipping," which may or may not involve renovations.

The Government of Canada introduced a measure on January 1, 2023, in which the profit from property flipping is fully taxable as business income if the residential property is sold within the first year of possession (with some exceptions). The British Columbia government also announced a home flipping tax, which will take effect on January 1, 2025. This tax will apply to properties sold within one year of possession and to properties sold from one to less than two years after possession with a decreasing rate.

The analysis below examines the flipping of residential properties purchased from 2019 to 2021 in British Columbia. "Property flipping" refers here to the purchase and resale of residential property within one year of possession. Based on this definition, residential properties can be flipped by owners who make no improvements to the house, by investors who renovate to seek capital gains or by individuals who need to sell quickly because of changing life circumstances such as a death, divorce or job change.

More than 3% of properties sold in 2021 in British Columbia were owned for less than one year

Among all residential properties sold in British Columbia from 2019 to 2021, 2.8% had been owned by their sellers for less than one year. This proportion was highest in 2021, at 3.3%.

By comparison, it was more common for residential properties to be resold in the second year of ownership. For instance, 5.3% of properties sold in 2021 and 6.2% of those sold in 2019 had been held by their seller from one to less than two years.

Chart 1 
Property flipping rate in British Columbia was the lowest in 2020

Higher rates of property flipping in urban areas

Property flipping was more prevalent in the urban areas of British Columbia. In the census metropolitan area (CMA) of Vancouver, for example, the proportion of properties flipped within one year of possession reached 3.2% of all sales transactions in 2021, representing 2,095 properties. This proportion was similar in Kelowna (3.4%; 250 properties) and Victoria (3.3%; 295 properties). This proportion was higher in the CMA of Abbotsford–Mission (6.5%; 355 properties), though it was smaller in previous years. By contrast, this proportion was lower in the rural areas of the province (2.5%; 405 properties) in 2021.

Chart 2 
Higher proportion of properties flipped in the largest cities compared with rural areas in 2021

Condominium apartments are flipped more frequently than other types of properties

Condominium apartments were more likely to be sold within one year of purchase compared with all other property types. In 2021, 4.0% of all condominium apartments sold were the results of a one-year flip, compared with 2.8% for single-detached houses. This proportion was 3.4% for properties with multiple residential units, which are often houses with a laneway or basement suite in British Columbia.

These results are consistent with general statistics on the duration of property ownership in the province. For example, as of January 1, 2022, condominium apartments had been held by their owners for a shorter duration, with a median ownership duration of 5.9 years. By comparison, the median ownership duration was longer for row houses (6.3 years), semi-detached houses (8.1 years) and single-detached houses (13.5 years).

Chart 3 
In 2021, 1 in 25 condominium apartments sold is the result of a one-year flip

Flipped properties have a lower median purchase price and they increase more in value

In British Columbia, properties that were acquired in 2020 and flipped within one year had a lower median purchase price ($565,000) than other properties acquired that year ($610,000).

In the CMA of Vancouver, the median purchase price in 2020 of condominium apartments flipped within one year was $530,000, 4.5% lower than the price of other apartments sold that year ($555,000). Similarly, single-detached houses purchased in 2020 and sold within one year were acquired at a median price of $995,000, which was one-fifth (20.1%) lower than the price of other houses sold in the CMA that year ($1,245,000).

The median price gain of properties flipped within one year and sold in 2021 was $115,000, representing a 20.3% gross profit. This gain was higher for flipped single-detached houses (+23.9%) than for flipped condominium apartments (+16.3%). These short-term gains occurred in the context of an overall price increase amid a booming real estate market in British Columbia. By comparison, the median annual price of all residential properties in the province increased 18.0% from 2020 to 2021, rising from $610,000 to $720,000.

Property flippers were more likely to be men, immigrants and older

Property flippers also had different characteristics compared with other buyers. For instance, businesses (7.9%) accounted for a higher proportion of property flippers compared with their representation among real estate buyers (2.6%) in 2020.

Among individual buyers in 2020, people who flipped a property within one year tended to be older, with a median age of 47 years, compared with 43 years for other buyers.

Men and immigrants were also more likely to be individual property flippers. In 2020, 52.3% of property flippers were men and 45.0% were immigrants. Proportions of men (49.9%) and immigrants (36.3%) were lower among all other individual property buyers.

Furthermore, property flippers had lower median family incomes ($115,000) in 2020 compared with homebuyers who did not flip a property ($125,000).

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).