Wednesday, January 9, 2019

Canadian real estate is worth literally trillions, but…


A Statistics Canada report released in late December revealed that real estate accounted for as much as $8.752 trillion of the nation’s total wealth during Q3 2018.

This represented approximately 76% of Canada’s wealth during that quarter, estimated to be at $11.415 trillion.

Such a top-heavy set-up might prove problematic in the event of a “sharp, sustained correction in house prices given the wealth effect on spending,” BMO senior economist Sal Guatieri told Global News.

Guatieri admitted, however, that this trend appeared inevitable in light of the “sharp rise in home values” observed in red-hot markets like Toronto and Vancouver over the past decade.

From Q1 2009 up to Q2 2017, the total value of Canadian real estate grew from around $2 trillion to approximately $4.2 trillion. This subsequently moderated, relatively speaking, to $4.1 trillion in Q3 2017.
In many ways, it is not false to state that taxes come at you from all directions. In this day and age, there are a variety of levels of government that are granted taxing authority of different types.
 
Two levels of government that are responsible for imposing a range of different types of taxes are the provincial and municipal Governments. Even though a great deal of media attention remains focused on taxes imposed by the federal government, these two levels of government across Canada prove to extract a considerable tax burden from their citizens. Provincial and municipal governments utilize a variety of different types of taxes to generate revenue, including income, sales and property taxes. 

Are Government's truly committed to solving the housing and rental crisis, or is a speculation and vacancy tax a revenue pool that can be resourced?

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