4mo ago

PM Mark Carney Announces Elimination of GST on New Homes

www.cpac.ca

First time home buyers will not be charged GST (5%) when buying a home, as long as the place they're buying costs less than $1M. This means that people buying a home for the first time will save up to $50k on their purchase.

Edit: Note, GST is mostly only charged when buying newly built homes, so this won't have any effect for people buying used homes.

61 comments

On many other parts of the internet you'll see a lot of people saying Carney copied Pierre's policy.
As shown below Carney's exemption is specific to first time home buyers where Pierre's is not. Also doesn't have whatever that rental thing is supposed to be.
Liberals most tangible housing policies in the past 9 years has been providing more purchasing power to "first time home buyers". I think this would be there 4-5th thing to do so, in which case not exactly a significant departure what they've done in this area.
Sept 2023
https://www.conservative.ca/building-homes-not-bureaucracy/
Remove GST on the building of any new homes with rental prices below market value. This will be funded using dollars from the failed Liberal Housing Accelerator fund. Within a year and a half of this law passing, list 15 percent of the federal government’s 37,000 buildings and all appropriate federal land to be turned into homes people can afford.
Oct 2024
https://www.cbc.ca/news/politics/poilievre-gst-new-homes-cut-1.7365339
Conservative Leader Pierre Poilievre is pledging to eliminate the GST on new homes sold for under $1 million if his party wins the next federal election.
- I don’t even care if he had copied Pollivres policy, governing is about doing what’s right for Canada before all else, including your own pride.
  I want leadership who implement good ideas from all sides of aisle.
  If Pollievre is more worried about pride than happy that Canadians are benefitting he has the wrong mentality.
  
  Yeah, I really wish the Federal Conservatives would implode as a party already. They’re making our politics so toxic that they make the Ontario Conservatives/Ford look good.
  What I want more than anything right now is for our politicians to work together to solve the ridiculous amount of issues at hand rather than flinging shit.
- Those are some important distinctions.
- Informative
Same shit different PM.
These people don't have the fucking cojones to do the right thing and just make foreign ownership of residential homes illegal. And make it illegal to have investment vehicles based on residential properties like ETFs. And straight up make it illegal for a publicly traded company to own residential property. And limit ownership of residential properties per person. And ban AirBnB and the like.
But nooooo. Just make it even cheaper for the already wealthy people to buy even more peppery.
- Many of these things you’ve suggested have been tried in various parts of Canada, and while they feel good they haven’t been effective at lowering prices.
  We need to build more homes. That’s it. That’s the thing we need to do. Build homes at a faster rate than we add potential new homeowners. Block nimby laws that prevent density and keep building until the prices go down.
  Like markets? Enable the market to build em. Socialist? Have the government build em. Someone’s got to. If you want to focus on Airbnb and other feel good stuff fine I won’t stand in your way if we also just build more goddamn homes.
  
  We need to build more homes. That’s it. That’s the thing we need to do.
  We're 3 million homes in the hole according to CMHC. Nobody is pretending we're gonna get those built in the next five years. Along with building houses, increasing density, and reducing limitations on construction; we need to lower the cost of houses.
  Like the Lemmite up thread says: tax unreasonable house gains, and disincentivize rentals.
  We're in a crisis, we can't wait to build.
  
  That'll take time. What I mentioned can be applied now.
- "Why won't the liberals deliberalize the economy?"
  
  lol. Nice one.
- I generally agree with you, but there's some complexity.
  Change all those things too quickly and housing plummets in value. That's great for buyers, but bad for sellers. Some old people have most of their life savings wrapped up in their houses, and some are even using reverse mortgages to make ends meet.
  At the least though, they should tax those things, and ramp up the taxes so they're really painful. If an ultra-rich foreigner wants to own a house in Canada and is willing to pay huge taxes for that privilege, maybe that's OK because those taxes can be spent on housing solutions for everyone else.
  
  Just like any form of investment, diversifying is important. If someone is 100% invested in Loblaws stock, do you expect the government to defend Loblaws to protect their investment just because they're relying on that to retire? The people made the choice to depend on a single volatile investment to retire, it means they took a chance that its value could drop.
  Hell, it could happen for a bunch of other reasons, one bad neighbor fucking up their lot and your home loses value.
  
  I don't care if houses plummet in value. You want to invest? You gotta assume the risk, just like in the stock market. And peppery prices are way over inflated anyway.
  And if we limit who can buy these properties to Canadians and PRs and limit the number of properties per person you won't have a hoarding problem. And everyone will have better access to housing.
  
  That’s why you begin by taking advantage of the incoming boomer drop off. They’re gonna start dropping fast. Unfortunately, that’s what most of the wealthy and powerful want to take advantage of too.
Need to do what Japan did and offload zoning from the provincial governments to the federal.
Only way to stop the NIMBYs and corruption.
- It's not like higher tiers of government are necessarily less corrupt.
  The idea I like is to tax NIMBYs. Have an auction where the "prize" is immunity from new housing for say 5 years, and the price is the property tax you pay. If you want to prevent the construction of denser housing in your neighbourhood, you need to outbid all the other neighbourhoods that also want to avoid it. Any neighbourhood that drops out of the auction pays no additional property tax.
  That way right neighbourhoods of NIMBYs basically pay the rest of the city for the privilege of not having things built in their backyards.
Making it easier to buy a home for a first-time homebuyer is good. But, this is also going to cause more inflation in home prices. It's basically the government kicking in up to $50k of the price a new buyer will pay. That means that the amount a new home buyer is going to be willing to offer for a house will go up by about 5%, and anybody else trying to buy the same home will have to match that bid or lose out.
If this is a temporary thing, then it's a very nice gift to first-time home buyers. And, being fair, it's mostly first-time home buyers who need the help. Anybody who already has a house is already on the "property ladder" and has been able to just sit back and watch their houses appreciate in value much faster than even the superstar stocks on the stock market while they do literally nothing. But, in the long run, this just makes the problem of insane housing prices worse. I'd love it if it were matched with a big tax on the sale of houses by people who own multiple properties. But, that's not going to be popular during an election season.
- Shouldn't it be a big tax on the sale of houses to multi-property owners? They're the ones to discourage, not the people reducing their real estate portfolio.
  
  Good point. I was just thinking of taxing the transaction, but you're right that if a multi-property owner wants to slim down to just the house they live in, they shouldn't be taxed for doing that.
- Yes, but making new homes cheaper and more in demand will increase demand for them and that’s where developers can increase supply
  
  Your economics is all screwed up.
  The whole point is that this isn't making homes cheaper, it's making homes more expensive, but the government is picking up part of the tab. First time home buyers will be willing to pay a higher price for a given newly built house because some of the money they'll be spending won't be their own. If people who aren't first time home buyers want to compete, they'll also have to pay more for the same house.
  
  Isn't high demand the whole reason that prices are so high to begin with?
- It's still a step in the right direction tho, eh? Of course, it needs other policies in addition to it like:
  MANY preapproved house designs to spend less time in bureaucracy. I think Carney's already doing that, right?
  Removing single family zoning. This comes under provincial/municipal governments from what I know. My municipality has already done this.
  The big tax thing you suggested. I would go ahead and say that there should be an outright ban on owning more than 2/3 properties by private individuals/corporations (this excluded non profit housing coops). But yeah, it'll be wildly unpopular. See how the carbon tax turned out.
  
  Yeah, it will help a bit. But it's a really, really big problem. I think it's going to take decades to fix. But, if they can at least make it so house prices stabilize and only increase at the same rate as everything else in the economy, that would be a big step in the right direction.
- New homes means newly built, right? So if a model sells for 300k the company building it can't just increase the price to 315k to compensate as it would mean losing the non-first-time home buyers who are willing to pay 300k as customers.
You know, Poilievre was right.
He can't go around taking concrete positions and advocating actual policy decisions. The governing party might agree they're good and do it themselves. And we certainly can't have that, can we? The point of official opposition is to oppose, not some hippy leftist nonsense like making Canada better.
This is great for single family homes. But for the medium and high-density housing that we need this is useless, all those buildings will be over $1M.
Seems like a ploy to snag some Conservative voters, which is good I guess.
- They do say it's a no GST on "homes", which could theoretically include units in a condo. Maybe if the building costs multiple millions but your unit is under one million it would count?
  It's better than the conservative plan, but it's not nearly enough to fix the whole thing. But, maybe it's good for votes because it's easy to understand.

61 comments