OTTAWA, March 26 /CNW Telbec/ - Over 200 REALTORS(R) and representatives
of more than 100 real estate Boards and Associations from across Canada will
visit their Members of Parliament on March 26th and 27th to discuss two key
federal issues impacting Canada's real estate industry.
The first REALTOR(R) proposal is to raise the maximum amount Canadians
can withdraw from their RRSPs under the Home Buyers' Plan from $20,000 to
$25,000 per individual. The increase is needed to account for the 27 per cent
increase in consumer price inflation since the plan was established in 1992.
"The lack of inflation adjustment is an obvious oversight in the design
of the national Home Buyers' Plan," noted Beauchamp. "The maximum loan limit
under the Home Buyers' Plan has been losing ground as a percentage of rising
average resale home prices for more than a decade. Plan users are being forced
to finance bigger mortgages, causing their debt burden to rise even as
interest rates remain low."
"The Home Buyers' Plan is a very successful federal program that has
helped over 1.5 million first-time home buyers to purchase more than 790,000
homes over the past 15 years," said CREA CEO Pierre Beauchamp. "The plan also
encourages Canadians to start retirement savings earlier, since owning a
principal residence represents the foundation of an overall financial and
"The REALTOR(R) proposal addresses the lack of inflation adjustment, and
would help ensure the Home Buyers' Plan is better able to meet the needs of
first-time home buyers," added Beauchamp.
REALTORS(R) have also developed a detailed proposal to encourage
reinvestment in real property. The current capital gains regulations suppress
the opportunity to reinvest in real property because investors are deterred by
a lock-in effect. This means lost opportunities for Canadians.
The REALTOR(R) proposal allow the deferral of capital gains tax and
recaptured capital costs when an investment property is sold, and the proceeds
of the sale are invested in another investment property within one year.
REALTORS(R) have been calling on the federal government to make such changes
to the capital gains tax for several years now. The proposal would provide
several economic benefits, including a boost in Canada's productivity,
expansion of rental housing, and encouragement of urban regeneration.
"Small investors are holding onto their real property investments because
of the tax consequences associated with selling and reinvesting, and this is
unduly influencing typical market activity," said CREA Chief Executive Officer
"Despite our disappointment that capital gains were not addressed in the
2007 Federal Budget, CREA remains committed to working with the federal
government to develop a policy that will encourage investment in real
property. These meetings with our elected officials are an important part of
this process," added Beauchamp.
The full package of 2007 REALTOR(R) federal government proposals can be
found at www.crea.ca under the Federal Affairs/Issues tab.
About The Canadian Real Estate Association
The Canadian Real Estate Association is one of Canada's largest
single-industry trade Associations, and represents more than 88,000
REALTORS(R) across Canada. CREA's primary mission is to represent its members
at the federal level of government and to act as a watchdog on national
legislation affecting or impacting the real estate industry. CREA also works
to defend the public's right to own and enjoy property.
A March 2007 report prepared by Altus Clayton for The Canadian Real
Estate Association estimates that the average MLS(R) home transaction
generates a total of $32,200 in ancillary spending above and beyond the
purchase price. That's more than a $14.8 billion annual contribution to the
Canadian economy. The report also estimates some 153,400 jobs are directly and
indirectly generated by MLS(R) home sales each year.
For further information:
For further information: Bob Linney, Communications Director, The
Canadian Real Estate Association, Office: (613) 237-7111, Cell: (613)