Federal capital gains tax changes put housing for 3,000 Nova Scotia households at risk
More than 3,000 Nova Scotia households could lose their homes thanks to the federal government’s proposed capital gains tax changes.
That’s the major finding of a new survey by the Investment Property Owners Association of Nova Scotia (IPOANS). More than 100 rental housing property owners responded to the survey asking what the impact of the federal changes will be. Approximately 50 per cent plan to sell their properties to get ahead of the federal government’s tax hike. These respondents reported ownership of more than 3,000 rental housing units, both single family homes and multi-unit residential buildings.
“The federal government’s capital gains tax hike is going to make the housing crisis worse and result in more homeless Nova Scotians,” said Kevin Russell, Executive Director of IPOANS. “As existing property owners sell their housing units to get ahead of the new federal tax hike, new owners will be moving in, making renovations to older buildings or raising rents to pay for their mortgages and other operating costs.”
Russell sent a letter last week to all 11 Nova Scotia Members of Parliament, including Housing, Communities and Infrastructure Minister Sean Fraser, to report the survey results.
“It is clear the federal government did not consult with rental housing providers before bringing forward this tax hike,” added Russell. “We urge Minister Fraser to do the right thing for affordable housing. He needs to convince the Prime Minister and Finance Minister to put this tax hike on hold until there has been a full and comprehensive consultation with the people that provide one-third of housing to Canadians.”
Russell also shared a summary of sentiments expressed by respondents, including:
- Impact on retirement plans;
- Discouragement of investment;
- Financial hardship;
- Perceived unfairness;
- Economic and social implications; and
- Distrust in government.
IPOANS Capital Gains Survey
Sentiment Summary May 19. 2024
The overall sentiment of the survey responses is overwhelmingly negative. Respondents express significant concerns and dissatisfaction with the proposed changes to capital gains taxes. Key themes include:
- Impact on Retirement Plans: Many respondents highlight that the increased capital gains tax will negatively affect their retirement plans. They emphasize that their investments in properties were meant to secure their retirement, and the new tax measures will force them to work longer or retire with less financial security.
- Discouragement of Investment: There is a strong sentiment that the changes will discourage investment in real estate. Respondents believe that this will lead to a reduction in the availability of rental properties and negatively impact the broader economy.
- Financial Hardship: Several small landlords express concerns about financial hardship due to the increased taxes. They mention that the changes will reduce their already modest gains and make it difficult to manage their properties profitably.
- Perceived Unfairness: Respondents feel that the government is unfairly targeting individuals who have planned for their future and invested in real estate as a means of financial security. There is a perception that these measures are punitive towards the middle class and small investors.
- Economic and Social Implications: Some comments suggest that the new policies will lead to broader economic and social issues, including reduced investment in housing, increased concentration of property ownership among larger landlords, and potential negative impacts on housing availability and affordability.
- Distrust in Government: There is a notable level of distrust and frustration with the federal government. Respondents’ express skepticism about the government’s intentions and effectiveness, accusing it of being misleading and making poor policy decisions that do not benefit the average citizen.
Overall, the responses indicate strong opposition to the proposed tax changes, with concerns about personal financial impact, broader economic consequences, and a perceived lack of fairness and transparency from the government.
Questions?
Kevin Russell | Executive Director
O: 902.425.3572 | C: 902.789.0946 | E: kevin@rhpns.ca
211 Horseshoe Lake Drive, Suite 112, Halifax, NS, B3S 0B9
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