Voila! This is good news. People who are spending restless days and nights worrying about buying a home, don’t have to stress out any more because government has decided to step in to bring more affordable homes in the market.
Here are some points describing how government is bringing affordable homes:
INTRODUCING VACANCY TAX
Toronto Mayor John Tory held a meeting to emphasize on the provision for approval to apply a tax on vacant properties, he announced this as a measure to increase supply in a congested market.
Finance Minister Bill Morneau promised for his will to call a meeting about the issues of housing affordability with a plan to give the lower levels of government with federal data related to the housing market. Though he did not clear the type of data, all he revealed was that it would be in favor to “support tax compliance” within the real estate sector of Greater Toronto Area.
The main purpose to levy this vacancy tax is to make Canadian economy stable.
MEASURES TO CALM REAL ESTATE MARKET
When the government tabulated last month’s budget, Morneau made a decision to increase the capital gains tax on second homes. This was concluded that this decision will assist each corner of the country regarding rising down-payment needs for expensive homes and also a mortgage stress test need for getting help in buying process.
Tory said that there is not any easy-going fix for affordable housing crisis. “I don’t think there are any magic answers to this,” Tory told CBC Radio’s Metro Morning. “I think if somebody had one, it would have been unveiled by now. So at least we’re going to talk.”
John Tory also suggested some measurements to be taken into account, which are: A plan to address the “longer-term issues” of affordable rental housing; better data, particularly on speculation in the market by both domestic and foreign buyers; and consideration of a tax on vacant homes.
BEING AWARE OF THE REALITY
Lawmakers are totally unaware of the actual situation. Thus, this “knowing nothing” mindset needs to be improved so that curiosity to know arises.
“The experts tell us that there’s a degree of speculation going on in the marketplace, but if you said ‘do we know for sure who is speculating and the kind of speculation that’s going on,’ we actually don’t,” Tory said. “There just aren’t records to tell us that.”
“This is one of the problems, that when you’re looking for a solution or something that will help cool the market, you have to understand what’s causing it to go up,” Tory said.
Tory also said that the homes which are being built purposely for renting should be built more. But the major necessity is that all the rental units should follow the same rent-control measures.
“The bottom line is, it’s people investing in these buildings and they expect to have a return, and if they look at their return as being limited … if the government tightens that screw too much, then the answer is yes, people will say either, ‘fine, we will build condos’ or they will build nothing,” Tory said.
So every move “should be accompanied by measures which mitigate that by saying, ‘OK, we’ll take the HST off the building materials for purpose-built rental accommodation,’ or something that says to people in that business, ‘we still want you to build.'” In order to bring affordable homes, rent control may prove to be very beneficial.