Government Aims To Make Housing More Affordable

The ministry of finance has released its ‘Fall Economic Statement 2022’ and, as part of its mandate to make housing more affordable, is moving forward with a package of measures including the Multigenerational Home Renovation Tax Credit to facilitate in-home suites for the elderly and vulnerable. The refundable tax credit will start in the new year and provide up to $7,500 in support for constructing a secondary suite to help families care for an aging grandparent at home or support a child with a disability move back home. The Tax-Free First Home Savings Account is designed to help young Canadians afford a downpayment faster. It will allow prospective first-time home buyers to save up to $40,000 tax-free toward their first home. Like an RRSP, contributions would be tax-deductible, and withdrawals to purchase a first home – including investment income – would be non-taxable. Canadians should be able to open and begin contributing to an account in mid-2023. To crack down on house flipping, profits from properties held for less than 12 months will be fully taxed, starting in 2023, with certain exceptions for unexpected life events (e.g., death, divorce).