New Tax free first home savings account (TFFHSA) starts next year

[statick]

Agreed with the sentiment in this thread on how this won’t really address the issue. A quick correction to the original post, the FHSA and HBP are NOT able to both be used for the same qualifying home purchase.

https://budget.gc.ca/2022/report-rap...f-en.html#a2_1

[Mogg]

I agree with the sentiment of the thread however I will happily take the extra $40K in tax shelter.

I don't think this will fix or even really help with the housing issue in markets like Toronto or Vancouver but I do think it will help in Calgary. I believe it will mostly help young investors avoid CMHC insurance premiums.

Overall, tax rebate + tax free growth + insurance premium avoidance can make a substantial impact on the purchase of a first home for Calgarians.

[ExtraSlow]

Helping real estate investors? Gross. That's how you grow a housing crisis.

[Buster]

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I agree with the sentiment of the thread however I will happily take the extra $40K in tax shelter.

I don't think this will fix or even really help with the housing issue in markets like Toronto or Vancouver but I do think it will help in Calgary. I believe it will mostly help young investors avoid CMHC insurance premiums.

Overall, tax rebate + tax free growth + insurance premium avoidance can make a substantial impact on the purchase of a first home for Calgarians.

They should provide these incentives for productive activities. RE has become a drag on the economy - and has been for some time.

[Masked Bandit]

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If I'm saving for a house I now have $14K per year in contribution room in tax free accounts. I don't think it's the taxes on the gains of the second $8K that is the make or break of anyone buying a home but man it sure is good vote-grabbing isn't it? On the other hand, why should someone get $8K per year of tax free contribution / investing that I don't get just because I bought my house already? The simple solution here was just to bump the TFSA limit to $10K - $14K per year so it was fair to everyone.

Fuck me...I completely missed the part where contributions to this new program are tax deductible like an RRSP. This is the best parts of an RRSP and TFSA but only for certain people. Fuck you Trudeau! Shit like this just encourages me to get even more "creative" on my tax accounting. Assholes.

[mr2mike]

I'm with @Buster on all his comments thus far.
A dumb idea overall.
Just increase TFSA room and be done.

[finboy]

I told my sister this is a great way to get more tax avoidance headroom along with the resp as she has a kid, I just wish they cranked up the Tfsa contribution limits instead. Joys of not having a kid, the government just wants to take instead of offering more ways to avoid paying them.

[ExtraSlow]

The government want to be very involved in how you send and save your money.

[mr2mike]

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The government want to be very involved in how you send and save your money.

They also want to be certain you can't afford lube.

[riander5]

This should really help young people dreaming of becoming homeowners in rural Manitoba save up a 10% down payment

[killramos]

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This should really help young people dreaming of becoming homeowners in rural Manitoba save up a 10% down payment

I think it’s been quite clear that Liberals can’t do math

[riander5]

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I think it’s been quite clear that Liberals can’t do math

The sad part is their voter base seems to think it's an acceptable field for their leaders to have no expertise in.

[jutes]

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The sad part is their voter base seems to think it's an acceptable field for their leaders to have no expertise in.

This is how public service works.

[riander5]

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This is how public service works.

Im considering getting a public service job on the side that allows WFH. I think I can dedicate an hour a day to it for the pension. AHS seems like it has a good level of middle management fat. Teams video meetings camera always off

[Buster]

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Im considering getting a public service job on the side that allows WFH. I think I can dedicate an hour a day to it for the pension. AHS seems like it has a good level of middle management fat. Teams video meetings camera always off

this is more sensible than you might think

[killramos]

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The sad part is their voter base seems to think it's an acceptable field for their leaders to have no expertise in.

Well their voters can’t do math, so I don’t see why they would have any higher expectations for their elected representatives.

Liberal MP’s are a Symptom. Not the disease.

[riander5]

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this is more sensible than you might think

Train a VA from the Philippines. Maybe I could automate this entire thing.

[kertejud2]

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But I do agree. Long term what we need is more housing; housing demand is fairly inelastic, we need more supply.
Tax breaks for builders, relaxation of zoning, encourage more multi-unit buildings, ban foreign owners.

These are mostly under provincial jurisdiction (municipalities also involved, but they only operate at the pleasure of the provincial rules).

The reason the feds keep coming up with financial related incentives that are generally ineffective at dealing with the problem is because it's all they can really do. Banning foreign investment in housing has an easy workaround and is mostly theatre. Things like the Speculation and vacancy tax route at least tries to encourage using the housing supply to at least help renters a bit but is really just a way to collect more tax off such investment. The feds can commit a lot of money to building supply, which has it's own inflationary pressure, but if it's directed to helping marginal projects get built it can help the situation. Upzoning is good for adding supply in an efficient manner, but will also drive values up. But also trying to upzone without changes to various codes and planning initiatives will just lead to more of the same.

No one thing can make a good start dealing with the issue, but there are good places to start: Federal money keeping the foot on the gas of development, and having provinces/municipalities ensure that development becoming more efficient at providing affordable units (building codes that allow more 'living space per square foot of building' for lack of a better term, dropping parking minimums), up-zoning and dropping levies/provide subsidies on brownfield development will help curb sprawl while still providing units. Land value taxes on underutilized lots to help incentivize development as well (make it so that a surface parking lot isn't economical). Some cities already do a lot to maximize their development potential (as much as voters will allow, anyway) and they still have crazy home values.

But any supply driven solution will take time, so government's don't like to set up initiatives that they won't get to reap the rewards from. Nor do provinces like to erode their own responsibilities at the behest of the federal government. SSo I'm not optimistic any of that will happen. Homeowners have no incentive to support a government that will see home values drop, and since they make up such a large part of the electorate, no government will do anything to truly tackle the issue (though all will put on a show pretending to).

[Buster]

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These are mostly under provincial jurisdiction (municipalities also involved, but they only operate at the pleasure of the provincial rules).

The reason the feds keep coming up with financial related incentives that are generally ineffective at dealing with the problem is because it's all they can really do. Banning foreign investment in housing has an easy workaround and is mostly theatre. Things like the Speculation and vacancy tax route at least tries to encourage using the housing supply to at least help renters a bit but is really just a way to collect more tax off such investment. The feds can commit a lot of money to building supply, which has it's own inflationary pressure, but if it's directed to helping marginal projects get built it can help the situation. Upzoning is good for adding supply in an efficient manner, but will also drive values up. But also trying to upzone without changes to various codes and planning initiatives will just lead to more of the same.

No one thing can make a good start dealing with the issue, but there are good places to start: Federal money keeping the foot on the gas of development, and having provinces/municipalities ensure that development becoming more efficient at providing affordable units (building codes that allow more 'living space per square foot of building' for lack of a better term, dropping parking minimums), up-zoning and dropping levies/provide subsidies on brownfield development will help curb sprawl while still providing units. Land value taxes on underutilized lots to help incentivize development as well (make it so that a surface parking lot isn't economical). Some cities already do a lot to maximize their development potential (as much as voters will allow, anyway) and they still have crazy home values.

But any supply driven solution will take time, so government's don't like to set up initiatives that they won't get to reap the rewards from. Nor do provinces like to erode their own responsibilities at the behest of the federal government. SSo I'm not optimistic any of that will happen. Homeowners have no incentive to support a government that will see home values drop, and since they make up such a large part of the electorate, no government will do anything to truly tackle the issue (though all will put on a show pretending to).

Are you suggesting that federal policy has not had an impact on housing inflation?

[kertejud2]

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Are you suggesting that federal policy has not had an impact on housing inflation?

No. I'm suggesting the federal government is very limited within it's powers to increase housing supply to tackle affordability as the quoted post was suggesting, which is why their proposed solutions are always so limited.

If you want to talk about federal policy's impact on housing inflation so bad, make a post about it.