Quebec’s official opposition – the Liberal Party of Quebec – has proposed to abolish the province’s land transfer tax for first-time home buyers if it wins the October 3 provincial election, Radio-Canada reports.
The so-called “welcome tax” rate varies by municipality, but in Montreal, the second largest city in the country and where approximately half of the province’s population resides, the tax is only 0.5% on the first $51,700, but drops to 2% for purchases between $517,100 and $1,034,200, and caps at 3% for homes worth at least $2 million.
According to the latest statistics from the Association professionnelle des courtiers immobiliers du Québec, the average price of a single-family home in the Montreal area rose 18% year-over-year in March from $480,000 to $565,550, while city skyscrapers rose 16% to $402,600 from $347,000.
Dominique Anglade, leader of the Quebec Liberal Party, the official opposition party, has proposed scrapping the tax for first-time home buyers who, as prices in the province – and in Montreal in particular – continue to rise increase, have difficulty establishing themselves in the real estate market.
“This accessibility problem is worrying, especially since it particularly affects young people and families in Quebec,” said Liberal Party spokesperson for housing, Marie-Claude Nichols.
Echoing Anglade, Martin Rouleau, a broker at Engel & Völkers, told STOREYS he was pleased with the move as first-time buyers find it increasingly difficult to enter the housing market in province. In Montreal, condos remain their primary means of homeownership because, unlike the single-family market, there are no fierce bidding wars, but they are hardly ideal for young, growing families. .
“Everyone would agree that it’s a great idea to help first-time home buyers for sure…it’s getting harder and harder for them to get into the market,” Rouleau said before warning that the Details of the Liberals’ plan are scarce.
“When they promise something like that, where will the money come from? Will they increase the welcome tax for second, third and fourth buyers? It’s a great idea, but where will the money come from?
While home prices in Montreal are a far cry from what they are in Vancouver and Toronto, Rouleau added, the city’s market favors sellers and anything that helps young people buy their first home will help.
The Quebec Liberals have also proposed increasing the amount of RRSP funds that can be used to purchase a home from $35,000 to $50,000, but since such a move would require federal government approval , it’s not set in stone.
However, it stands to reason that the federal Liberals in power would not oppose such a proposal in light of their own policies over the past few years to help first-time home buyers enter the housing market.
Neil covered housing and real estate for several years as a Toronto-based journalist. Prior to joining STOREYS, he was a regular contributor to the Toronto Star, Toronto Sun, National Post, Vice, Canadian Real Estate Wealth and several other publications. Do you have a real estate history? Email him at [email protected]
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