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Taking on more debt is not the solution to the housing crisis despite what the Liberals say

All the tax issues created by the new mortgage insurance rules cause more headaches than they’re worth

One of the newest measures the federal Liberal government has taken to increase housing supply is to change the mortgage insurance rules to enable existing homeowners to take on more debt in order to create rental units within existing homes.

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The new units must be fully self-contained units (such as basement suites with separate entrances, laneway homes) and meet municipal zoning requirements. There also cannot be more than four dwelling units, including the existing unit.

I will stay in my tax lane and not address the obvious insanity of enticing an already indebted population to take on even more debt, with the carrot being the “incredible advantages” of becoming a landlord. But I will point out the complete disregard for the myriad complicated tax issues that come with such a housing conversion. …[Continue Reading]