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British Columbia’s decision to impose a 15 per cent tax on foreign buyers to cool Vancouver’s scorching housing market is poised to derail more than 400 deals worth millions of dollars and may prompt calls for legal action.

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Anecdotal tales of offshore buyers walking away from deals in Metro Vancouver are being heard across real estate offices.



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At least 427 deals are likely to collapse due to the new measure, according to Dan Morrison, president of the Real Estate Board of Greater Vancouver, citing responses from 27 brokers to an e-mail inquiry. The group didn’t calculate the value of those sales, though they would be worth about $404 million based on the average purchase by a foreign buyer of $946,945.

That may just be the tip of the iceberg.

“It’s a domino effect,” said Elton Ash, Western Canada regional executive vice president for Re/Max Holdings Inc. Not only will foreign buyers be hit but also Canadians who had contracts to sell and had already put offers on their next house, he said. Morrison said the effects could take years to play out given some deals involve the sales of condos still being built.