A rental sign sits outside a Vancouver apartment on June 23, 2014.BEN NELMS/The Globe and Mail
The federal Liberals are promising tax breaks to developers who build new rental properties in Canada, and give millions to landlords to renovate existing housing stocks.
The Liberals want to eliminate the GST on all new rental builds in the country while giving up to $125-million a year to landlords renovating aging rental units in the country.
The party is also promising to let Canadians dip into their registered retirement savings more often to pay for a home, which Liberal Leader Justin Trudeau said may be their best source of equity heading into their twilight years.
Trudeau said his party would allow Canadians to repeatedly dig into their RRSPs to pay for a home if they have to move for work or the death of a spouse, see their marriage break down or take in an elderly relative. Current rules only allow Canadians to use their RRSPs to finance the purchase of their first home.
Under the Liberal plan, there would be no limit on how often Canadians could dip into their RRSPs to buy a home. But Liberal officials say they don't expect Canadians would use the program so often that it would become financially problematic.
The withdrawal limit would remain $25,000 for each transaction.
Whether Canadians are saving enough to pay for retirement has been the subject of competing reports and studies. However, a political battle is underway over whether workers should be required to pay more into their federal and provincial pension plans or given more private avenues to save for retirement.
Trudeau said that for many Canadians approaching retirement, the only savings they have is the equity in their home. He said it makes sense to allow people who face a sudden or unexpected change in their lives "to be able to invest in stability in a way that will help them in the long term as well."
Trudeau unveiled the pledge at a co-operative housing complex in downtown Toronto alongside Spadina-Fort York candidate Adam Vaughan, who is in a high-profile race against the NDP's Olivia Chow. Chow won the seat in the 2011 election before leaving to make a failed bid for the Toronto mayoralty.
Trudeau made his announcement in an area where new condos continue to colonize the city's skyline. It also tied in with a Liberal promise to study hot housing markets in cities like Toronto and Vancouver to determine what is driving up the cost of homes and condos.
The Liberals are also promising to study the hot housing markets in cities like Toronto and Vancouver to see what is driving up the cost of homes and condos.
The Conservatives made a similar commitment in Vancouver last month, tapping into concerns that foreign buyers were snapping up properties and driving up prices while the units themselves remain empty.