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Canada to crack down on profit making from short-term rentals -The Toronto Star

FILE PHOTO: Fourth day of the International Monetary Fund and the World Bank meeting in Marrakech

(Reuters) - Canada's Finance Minister Chrystia Freeland will announce a narrowly focused fall fiscal update on Tuesday to include a measure designed to make it less lucrative for people to use their properties as short-term rentals, Canadian newspaper The Toronto Star reported on Sunday.

Property owners in areas that already restrict short-term rentals will no long be able to claim their rental expenses against the income they make, a senior federal official told the newspaper.

The finance ministry did not immediately respond to a Reuters' request for comment.

Earlier this month, The Bank of Canada said the era of super-low interest rates was likely over and warned businesses and households to plan for higher borrowing costs than they have been used to in recent years.

The government has also announced plans to convert six federal properties into 2,800 new homes by March and is accelerating a process to identify more public buildings for home conversion as the country grapples with a housing shortage.

Housing supply has failed to keep up with Canada's immigration-fueled population growth, and affordability worsened during the coronavirus pandemic when housing prices soared due to high demand amid low borrowing costs.

The Canada Mortgage and Housing Corporation as well as the Bank of Canada have said the country's housing crunch needs to be solved by increasing supply.

(Reporting by Urvi Dugar in Bengaluru; Editing by Chris Reese)