By Steve Scherer
HAMILTON, Ontario (Reuters) – A re-elected Liberal government would ban foreigners from buying Canadian homes for the next two years and make house purchases more transparent in a bid to address rapid price gains, Prime Minister Justin Trudeau said on Tuesday.
Trudeau, seeking to retain power in a Sept. 20 federal election, also promised to build more homes and help renters become owners with a rent-to-own scheme, a down payment savings program and bigger tax credits.
“If you work hard, if you save, that dream of having your own place should be in reach,” Trudeau said during a campaign stop in Hamilton, Ontario, a fast-growing city outside Toronto.
Canadian home prices have jumped 15.6% in the last year and the Canadian Real Estate Association’s home price index is up 69.7% since November 2015, when Trudeau first took office.
The Liberals pledged to ban new foreign ownership of Canadian homes for two years and expand an existing tax on foreign-owned vacant housing. They promised an anti-flipping tax that would kick in on residential properties sold within 12 months of purchase.
“We’ll crack down on predatory speculators that stack the deck against you. So no more blind bidding,” said Trudeau.
Blind bidding is a practice in Canada where buyers submit an offer not knowing what their competitors are offering. Opponents say it can be abused to inflate selling prices.
Many Canadian housing markets have cooled from the peak of the pandemic-driven buying frenzy, but thousands of would-be buyers now need far more to afford down payments.
The Liberals say their new rent-to-own pledge will help Canadians save for down payments by turning a portion of their rent into savings, while the down payment savings program will allow for tax-free savings.
Trudeau’s main rival, Conservative leader Erin O’Toole, pledged last week https://www.reuters.com/world/americas/canadas-conservatives-promise-job-boom-challenge-trudeau-2021-08-16 to build a million homes over three years and said he would ban non-resident foreigners from buying Canadian properties for at least two years.
(Writing and additional reporting by Julie Gordon in Ottawa; editing by David Ljunggren and Jonathan Oatis)
