Government Announces New National Housing Measures
Posted October 8th, 2016 at 7:01 am by Aaron Nicklen | 0 Comments
In the wake of red-hot real estate markets, growing household debt, and concern around foreign buyers, the Federal Government is taking a proactive approach to address the issues and protect the nation’s housing industry. On October 3, Finance Minister Bill Morneau announced three new measures aimed to ensure the Canadian housing market remains stable.
These preventative measures are:
● Standardizing lending criteria for high- and low-ratio mortgages, including a mortgage stress test;
● Closing tax loopholes for capital gains exemptions on principal residence sales;
● Consulting with industry stakeholders to ensure risk is properly distributed.
The second measure specifically targets foreign buyers who are speculated to be avoiding paying taxes through loopholes.This announcement comes only a couple of months after the government of BC unveiled their 15 per cent surtax for foreign buyers.
“Canadians have told us they are concerned about growing household debt and rapidly rising house prices in some of our biggest cities, particularly in markets like Toronto and Vancouver. These concerns have grown over many years, and there are no quick fixes,” Minister of Finance Bill Morneau said. “The federal government plays an important role in ensuring that housing markets are stable and function efficiently.
On his Twitter account, the Finance Minister stated that these new rules, which formally come into force on Oct. 17, are an attempt to bring consistency to mortgage rules, reduce risk for taxpayers, and ensure everyone is playing by the rules, impacting all Canadians across the nation.