Real eState

LACKIE: Real estate capital gains tax should be non-starter – Toronto Sun

Published

3 years ago

April 2, 2022

Harry Miller

Publishing date:

Apr 02, 2022 • 2 hours ago • 3 minute read • 5 Comments

Real estate sales in Toronto aren’t going down, despite the pandemic. Photo by Files /Submitted

In the lead-up to the last federal election when the murmurs got louder that the Liberals were quietly contemplating rescinding the capital gains exemptions on principal residences, I quite literally laughed out loud.

Never mind that it had been revealed that our government’s Canada Mortgage and Housing Corporation had funded a study through Vancouver thinktank Generation Squeeze looking into exactly that. There was absolutely no conceivable way that could be true, I declared, as to do so would be political suicide.

I wrote on Sept. 11, 2021: “It will never happen. Because it would incense the voters and blow up the housing market. As long as politicians are in the business of being re-elected, decimating the home equity of every homeowning Canadian will be a non-starter.”

Except now I am not so sure, particularly in light of the new Liberal-NDP alliance.

Look at where we are.

A market that has become wholly untethered from the economic realities that should be anchoring prices. And a government whose policies have gotten us here, namely cranking the tap to let the money flow with apparent ambivalence to how that money coupled with easily-abused lending polices was actually driving investment and speculation.

In some areas that used to be popular sleeper communities outside of the city, housing prices have more than tripled through the pandemic. I’m as bullish as they come on the housing market, but there comes a point where you have to take a pause and question if you’re so in it that you can’t see the forest for the trees.

We apologize, but this video has failed to load.

This is, simply put, wildly unsustainable.

And what, exactly, is our government doing about it? What could they do about it? Sure, we can tax foreign buyers, eliminate blind bidding, and help first-time buyers tap into more money to get a leg up. But what will that really achieve?

The question was always, how long would our government sit back and hope that market forces self-regulated and then, at what point, would they decide it’s time to step in? If and when that day came, the real question is how disastrous would it be?

The housing market is like a garden hose flailing out of control. At a certain point it was inevitable the powers-that-be would decide it was worth getting messy to get to the other side. And I cannot think of anything that would make more of a mess while achieving less than rescinding the capital gains exemption for primary residences.

What that would mean is suddenly changing the terms on Canadians who planned their lives and financial futures around the equity held in their homes. And to be clear, this isn’t just that the rules would change with many boomers counting on the equity in their homes to fund their retirement. It’s that at the same time, the market will surely reel and we will see even less on the market than we have now.

We apologize, but this video has failed to load.

If that happens, it won’t just affect the boomers and won’t simply be a matter of the bank-robber proceeds from pandemic housing appreciation evaporating, no, it will yet again be the young people who will take the hit in the near term.

The same people who have had to save more and take on more debt all for the privilege of buying into the tightest real estate market on record.

If the market seizes from this government intervention resulting in any kind of precipitous fall, it will be those who recently bought-in who will feel it most acutely. And then of course, if by some miracle there is no significant price adjustment, all we will see is less inventory driving more competition that will serve to offset any of the subtle market cooling in response to rising interest hikes.

What is the upside then?

It’s just a cash grab.

Critics would say, so what — real estate has shifted from being simply one’s home to now a full-blown investment vehicle. Why should the haves who already benefit from property ownership also be able to cash in on a condition-free tax shelter? It’s only furthering the divide between the haves and have nots. And if that’s your view, I take your point completely.

However, what really should drive your fury is the idea that the same entities that tacitly enabled the explosion of our real estate market in the first place are now the ones willing to blow the whole thing up while telling us it’s for our own good. And nothing about this idea is good.

Let’s hope it’s a non-starter.

@brynnlackie

Adblock test (Why?)

Source link

Real eState

Greater Toronto home sales jump in October after Bank of Canada rate cuts: board

Published

6 days ago

November 6, 2024

Anne Joseph

TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.

The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.

The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.

“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.

“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”

The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.

New listings last month totalled 15,328, up 4.3 per cent from a year earlier.

In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.

The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.

“I thought they’d be up for sure, but not necessarily that much,” said Forbes.

“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”

He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.

“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.

“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”

All property types saw more sales in October compared with a year ago throughout the GTA.

Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.

“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.

“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”

This report by The Canadian Press was first published Nov. 6, 2024.

Source link

Real eState

Homelessness: Tiny home village to open next week in Halifax suburb

Published

3 weeks ago

October 24, 2024

Anne Joseph

HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.

Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.

Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.

The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.

Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.

They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.

The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.

This report by The Canadian Press was first published Oct. 24, 2024.

Source link

Real eState

Here are some facts about British Columbia’s housing market

Published

4 weeks ago

October 17, 2024

Anne Joseph

Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.

Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.

Average residential home price in B.C.: $938,500

Average price in greater Vancouver (2024 year to date): $1,304,438

Average price in greater Victoria (2024 year to date): $979,103

Average price in the Okanagan (2024 year to date): $748,015

Average two-bedroom purpose-built rental in Vancouver: $2,181

Average two-bedroom purpose-built rental in Victoria: $1,839

Average two-bedroom purpose-built rental in Canada: $1,359

Rental vacancy rate in Vancouver: 0.9 per cent

How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent

This report by The Canadian Press was first published Oct. 17, 2024.

Source link