In a significant move to address housing affordability in Canada, Conservative Leader Pierre Poilievre has pledged to abolish the federal sales tax on new homes priced under $1 million. This proposal, announced on October 28, 2024, aims to lower costs by approximately $40,000 for homes valued at around $800,000 and is projected to create an additional 30,000 homes annually. Poilievre intends to finance this tax cut by eliminating existing Liberal housing policies, including the controversial housing accelerator fund [0281cda0].
The Toronto Regional Real Estate Board (TRREB) has previously emphasized the urgent need for government action to tackle the housing affordability crisis. They support the government's commitment to building more homes and reducing taxes and fees for Canadians, while also cautioning against tax measures that could negatively impact housing supply. TRREB advocates for maximizing the use of government land assets to encourage new construction [2277ccf5].
As the 2024 Federal Budget outlines plans to deliver 3.87 million homes over the next decade, the focus remains on balancing affordability with the need for sustainable housing policies. TRREB has expressed concerns about potential tax increases, such as a higher capital gains tax, which could further strain affordability efforts [668987f0].
In the broader context of the housing market, real estate agents across Canada are predicting a volatile 2024. With the Bank of Canada expected to cut interest rates, experts anticipate a rebound in the housing market, although concerns about a potential recession linger. Economists forecast a decline in housing prices, projecting a 7% drop from their peak, alongside a slowdown in consumer spending due to higher borrowing costs [12972afb].
The Canadian government has also extended the ban on foreign ownership of Canadian housing until January 1, 2027, in a bid to alleviate pressure on the housing market caused by increased demand from migrants and international students [82422d05].
Prominent economist David Rosenberg has shifted his outlook on the housing market, suggesting that while home prices may decline, a crash is unlikely. He has raised concerns about Canada's ambitious immigration policy and its impact on housing affordability, calling for a reevaluation to ensure that immigrants can contribute positively to the economy [43877d74].
As these developments unfold, the stability of Canada's housing market in 2024 remains a topic of intense scrutiny. With Poilievre's tax proposal and ongoing government initiatives, the landscape of housing affordability is set to evolve significantly [88093f25].