Getting you the mortgage you deserve
Tax-Free Homebuyers Account, Ending Blind Bidding, Property 'Flippers' Tax and more!! Budget 2022 Announcement
April 8, 2022 | Posted by: Julie Stewart-Boyle
Interesting stuff in this latest budget! The Federal Government announced in their 2022 Budget on April 7, 2022 a number of measures to help with the rising concerns of home affordability and availability. I have outlined the various areas of interest in bullet points for you. In a nutshell:
Tax-Free First Home Savings Account (TFFHSA):
- Liberal Govt. announced a Tax-Free First Home Savings Account. The TFFHSA is expected to roll out in 2023.
- Canadians will be entitled to contribute up to $8,000 per year (each person) to their TFFHSA account
- Each individual puts money in their own TFFHSA.
- The program has a maximum lifetime contribution limit of $40,000
- Tax-free in, tax-free out
First-Time Home Buyers Tax Credit
- Doubled to $10,000
- Applied to any purchase made since Jan 1, 2022
Doubling Homes built
- Government to spend $10.14 billion on housing next 5 yrs
- Double the pace of building over the next decade to 200,000 units per year
- Talk of a $4 billion Housing Accelerator Fund run by CMHC to incentivize municipalities to speed up development approvals for new builds
- Limit profiteering
- Canada will need to build 3.5 million homes by 2031 to improve affordability, the federal budget predicted
Ban on Foreign Ownership
- Government is proposing a two-year ban on purchases of residential real estate by people and companies who aren't citizens or permanent residents.
- Refugees, some international students and people with work permits would be exempt from the policy.
- Notably, the ban wouldn't include recreational property, such as cottages, cabins and other vacation homes.
Home Buyers’ Bill of Rights:
- Plan to end “blind bidding” practices nationally
- Home’s sale price history more transparent
- Ensure a legal right to a home inspection before buying
Tax on Property “Flippers”
- Anyone selling a property owned for less than 12 months is considered to be “flipping”
- Subject to tax on their profits as business
- Expected immigration inflow increases will put more demand on housing
- Densification will be a given; more condos and coach houses (other varieties of ownership like co-ops), less single family detached homes.
Government said specifics would be announced “at a later date”.
Julie Stewart-Boyle, firstname.lastname@example.org, 250-668-4420