Happy New Year, I hope you are having a great start to 2023!
Both the Provincial and Federal governments are focusing on housing and I thought I would summarize for you 5 of the policies they have introduced or coming. I have a quick summary and some links with more detail in case any of these topics is of particular interest to you.
BC GOVERNMENT
Prohibition on strata rental and age restrictions: As of November 24th 2022 Strata’s are no longer able to pass by-laws that ban rentals or impose age restrictions of renters. The bill still allows for senior only strata buildings.
Housing Supply Act: Bill C42 is expected to come into effect in the middle of 2023. This bill introduces a framework for the Provincial government to set housing supply targets for 10 municipalities. It will give the provincial government increased authority to step in and approve developments if they are being delayed by municipalities.
FEDERAL GOVERNMENT
Foreign Buyer Ban: As of Jan. 1 2023, non-Canadians will be prohibited from buying residential property for two years. In BC it is estimated that about 4.7% of properties are bought by foreign buyers. This ban excludes:
- Canadian citizens and Permanent Residents International students who meet certain requirements, including having spent the bulk of the previous five years in Canada. They would be able to purchase a property for no more than $500,000.
- Workers who have worked and filed tax returns in Canada for at least three out of the four years prior to purchasing a property.
- Diplomats, consular staff and members of international organizations living in Canada.
- Foreign nationals with temporary resident status, including people fleeing conflict, and refugees.
Anti-Flipping Tax: Starting Jan 1 2023 any home bought and sold within 12 months (365 consecutive years) will be subject to an anti flipping tax. The CRA will tax the entire profit as business income. There are some exemptions for certain life events like death of an individual, addition to a household, breakdown of a relationship or threat to safety, serious illness or injury, loss of a job or work relocation.
First Time Home Buyer Savings Account (FHSA): This legislation is expected to be passed and come into effect in April 2023. This is a new tax deductible, tax free savings account (similar to an RRSP) that allows first time home buyers to save up to $40,000 to put towards the purchase of a qualifying home. This is in addition to the existing First TIme Home Buyer Plan (HBP) already in place. Who is eligible to participate:
- In order to open a FHSA you must be a resident of Canada and at least 18 years of age.
- be a first-time home buyer, which means you, or your spouse or common-law partner(“spouse”) did not own a qualifying home that you lived in as a principal place of residence at any time in the year the account is opened or the preceding four calendar years
Multi-generational home renovation tax credit: As of Jan 1 2023 you are able to get a 15% refund on your taxes (up to a maximum of $7,500) for expenses related to the building of a secondary suite for a family member who is a senior or an adult who has a disability.
I hope you found this information useful. I plan on continuing to provide you with real estate insights. If you have any questions about real estate please get in touch, I’d love to help you.