This sounds like something Trump would do, not Trudeau.
Canada bans foreign home buyers for two years
481–490 of 1001 posts
Re: Canada bans foreign home buyers for two years
#482I'm a homeowner in Toronto and I don't think this will help. They've eliminated a small number of buyers from the market but have added other incentives like a first home buyers tax credit that will only fuel the fire - Australia tried this with tragic results. >> working with provinces and territories to develop and implement a Home Buyers’ Bill of Rights and bring forward a national plan to end blind bidding. Blind…
> I don't think this will help.
Depends on what they hope to accomplish.
Re: Canada bans foreign home buyers for two years
#483Earlier quoted context omitted.
BC actually did this (tax empty homes). Did not affect prices. I suspect the real problem is low supply high demand + domestic speculation, which is why none of the blame the foreigner solutions work
Increase the taxes until there is an effect?
A tax on empty homes that started increasing after some grace period (say 3-12 months or whatever) would be amusing because at some point the vacancy owners would start paying people to live in the house so as to avoid the tax.
And if prices were going up enough, it'd be worth it.
Re: Canada bans foreign home buyers for two years
#484Earlier quoted context omitted.
I'd argue the main cause of this is the REALTORs/real estate boards/MLS system that stonewalls any attempts at making real estate information publicly available precisely because the size of their paycheques relies on this information remaining hidden from the public. The conflict of interest beggars belief, but it's allowed to remain, among other reasons, since it also tends to benefit political parties courting vot…
What's stopping Canada from increasing its housing stock? Surely Canada has plenty of space for its 30M citizens, right? (Yes, I understand that much of the territory is uninhabitable, but even still...).
Regulations...
Most land is off limits. Were I live the land is ’protected’ for agricultural use even though it is marginal at best and most farms doesn’t use the land.
In my case it killed my agribusiness project because the amount of work, the delays and the risks where too much to bear.
We can no longer build what we used to build in the 60’s and 70’s because of the regulations in spite of the technology being much better.
Re: Canada bans foreign home buyers for two years
#485I'm a homeowner in Toronto and I don't think this will help. They've eliminated a small number of buyers from the market but have added other incentives like a first home buyers tax credit that will only fuel the fire - Australia tried this with tragic results. >> working with provinces and territories to develop and implement a Home Buyers’ Bill of Rights and bring forward a national plan to end blind bidding. Blind…
Unethical? Give your honest best price and you're done. Whatever the seller is saying, whatever words come out of their mouth, unless it's "Sold!" you ignore them.
Re: Canada bans foreign home buyers for two years
#486Earlier quoted context omitted.
It can be difficult to disprove residency, especially if you can say you travel a lot for your work. I've uh...heard of people that are residents of Nevada for tax purposes. They have a tiny furnished apartment and their car is registered there, and they're registered to vote there, but let's say they aren't home very often.
Well it will not solve everything, but two things: - It will make it impossible for people without permanent residency to buy property. - It will prevent people from owning multiple homes in the country. You could also define a minimum number of days a year where they had to prove that they occupied the property, maybe at least a quarter of a year.
This quickly becomes problematic and starts requiring government tracking of travel, etc to "prove" residency.
It's actually a moderately complicated thing to prove, even though it seems it should be simple.
Re: Canada bans foreign home buyers for two years
#487This is a false step. You can still purchase a home through a shell, which literally negates this law entirely. Most of the people who are the issue, are using shells with purchases like this. zzzz
Re: Canada bans foreign home buyers for two years
#488I'm a homeowner in Toronto and I don't think this will help. They've eliminated a small number of buyers from the market but have added other incentives like a first home buyers tax credit that will only fuel the fire - Australia tried this with tragic results. >> working with provinces and territories to develop and implement a Home Buyers’ Bill of Rights and bring forward a national plan to end blind bidding. Blind…
Unethical? Give your honest best price and you're done. Whatever the seller is saying, whatever words come out of their mouth, unless it's "Sold!" you ignore them.
In a perfect world, yes. But that discounts all the psychology of the situation, FOMO, how invested the buyers may be in the property, etc. Its a rather one sided and exploitative situation.
Re: Canada bans foreign home buyers for two years
#489Earlier quoted context omitted.
2%. But how much of that 2% has been in the last 5 years? I heard it was up to 1/3rd of all properties sold.
Canadian MLS says 600,000 properties sold each year. Over 5 years that'd be roughly 3,000,000 homes. 1/3rd of that would be 1 million homes sold to foreign investors. There's only 1 million people globally (including Canadians) with a net worth over $10 million. That means every single one of them would have bought a Canadian home in the last 5 years. I mean Canada is nice and all, but does that seem plausible?
This sounds like trying to measure a stream by sampling a lake.
It’s entirely possible that people with high liquidity were buying and selling multiple properties while people with low liquidity were staying put. That would naturally mean more wealthy people are buying (and selling), and foreign owners are likely much wealthier than the average Canadian home owner.
Re: Canada bans foreign home buyers for two years
#490This article also said > The government will also impose higher taxes on people who sell their home within a year. Why would they raise taxes on people who decide to sell? Raising taxes on sales will decrease the number of sellers. If the goal is to decrease the price of housing, they should want to increase the number of sellers (partly by reducing taxes on sales) to increase the supply of housing. So backwards.
The goal is to dissuade flipping, the same reason we have short and long-term capital gains.
Nobody should be buying a house intending to sell it within a year, so the sellers affected are those already affected by some external influence (assuming they weren't trying to flip it).
The only way to increase sellers by reducing tax is to make it obvious it's a temporary reduction - if you say "anyone who sells in 2022 will do so with no capital gains" you'll create a lot of sellers, but most of those will just buy similar houses nearby.
You need to increase sellers without also increasing buyers, which you do by getting more houses to sell (developers as sellers), or getting people to move away (they sell but don't buy), or by having people sell without buying (they die or move in together, or rent, etc).