The Quebec Federation of Real Estate Boards (QFREB) says it welcomes the tax provisions announced by provincial Minister of Finance Carlos Leitão in regard to housing in the recent budget, but “would have preferred seeing more tangible measures to promote home ownership.” The federation is calling for the abolition of real estate transfer taxes, commonly called the “welcome tax”, for first-time homebuyers in Quebec.
“Concrete measures are needed in real estate given the fact that Quebec consumers are facing major mortgage tightening measures introduced by the federal government in recent years. Home ownership is more and more difficult for young families looking forward to building a family nest of their own,” says Patrick Juanéda, president of the QFREB.
The federation says it welcomes the introduction of the new tax credit for residential wastewater treatment systems, which will give homeowners up to $5,500 per taxpayer who must undertake repairs to their septic system. “Although the amount awarded is small compared to the huge cost that homeowners must assume for the work, the QFREB recognizes the government’s desire to lighten their financial burden,” it says.
The QFREB also welcomes the government’s decision to maintain the RénoVert tax credit for renovations, as well as the announcement that 3,000 new social housing units are to be built.
“The QFREB would have liked to see the Québec government adopt measures to reduce the tax burden for first-time homebuyers, as did his Ontario counterpart last fall,” says the federation. “A transfer tax exemption for Quebec first-time homebuyers, mostly young families, would also have helped to bridge the historical gap in Quebec’s homeownership rate compared to other Canadian provinces (61 per cent compared to over 70 per cent for the rest of Canada).
Furthermore, the transfer tax brackets have not been adjusted since 1992, while the price of residential properties has nearly tripled during the same period.
“The QFREB proposes that the taxation brackets used for calculating transfer taxes be modernized to reflect the current structure of the real estate market.”