Homeownership is expensive and is slipping further out of reach for too many Canadians.
Canadian homeowners already pay a punishing land transfer tax when they get the keys to their home, as well as increasing property taxes every year. And now, they want you to pay even more. A CMHC-funded report proposes another tax on homeowners, which would be calculated annually with the option of paying it each year or deferred until the sale of the home. Akin to a capital gains tax, this would punish seniors and middle-class families who have played by the rules and are relying on their homes as a financial nest egg for retirement.
The Government of Canada should distance itself from this report and state that they have no interest in a new tax on home equity. It should also direct the CMHC to stick to its core mandate, focus on increasing housing supply and choice, and refrain from this kind of political activism.
We said before that where there’s smoke, there’s fire. In 2020, it was reported that CMHC spent $250,000 in partnership with the University of British Columbia’s School of Population to investigate ways to tax the equity Canadians have gained in their homes.
CMHC denied the media stories, yet the report recently released shows that they are supporting research on an expensive home equity tax. Time and time again, we’ve said that you cannot tax your way to housing affordability and Ontarians agree: according to a Nanos Research report conducted in 2020, more than 6 in 10 Ontario residents would oppose (50%) or somewhat oppose (13%) a new capital gains tax on primary residences.
When you look at just homeowners, that opposition increases to over 7 in 10. A new tax on homes will add yet another barrier to Canadians putting their home up for sale, further restricting housing supply. CMHC and the anti-homeownership interest groups supported by CMHC funds should focus instead on increasing housing supply and choice, especially for first-time home buyers, instead of trying to punish homeowners.
– Tim Hudak, CEO of the Ontario Real Estate Association