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Canada real estate: What new Liberal promises mean for home prices

The Liberal budget is filled with planned measures targeting real estate including a foreign buyer tax and building more homes.

It's worth noting that home prices have more than doubled under Prime Minister Justin Trudeau.

We’ve been getting monthly updates from the ground floor from Realosophy Realty’s John Pasalis and Oakwyn Realty’s Steve Saretsky, who help make sense of it all, with advice for anyone buying or selling a home.

Also See: The latest real estate news for housing prices, mortgage rates, markets, luxury properties and more at Yahoo Finance Canada.

They told us what the measures will mean for housing affordability.

Jessy Bains is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.

Video Transcript

JESSY BAINS: Let's move on now to the budget, a bit of a follow up to some of the announcements we got. None of the big blockbusters that we've talked about on this show-- in my view though, the one raising the CMHCE limit from 1 million to 1.25 could have been a big one. Any sort of taxes on investors, a larger tax could have been a bigger one, not being able to use [INAUDIBLE].

So it was a lot of the stuff that we expected. I think, the marquee being the foreign buyers' tax. We're going to listen to Prime Minister Justin Trudeau, the day after the budget was released. He's at an affordable housing announcement.

But before we hear what he has to say, I just want to remind everybody that prices have in fact, more than doubled under his watch. But let's have a listen to what he had to say. And then I'll get you guys to weigh in. Have a listen.

JUSTIN TRUDEAU: When foreign investors and corporations use housing as an asset, it drives prices higher and higher, and makes homes out of reach for the middle class. Homes are to live in, to raise a family in, to build a life in. Not a way to boost the balance sheet.

JESSY BAINS: So John, I see you're sort of chuckling there. What goes through your mind when you hear him say that? And what's your overall view of those measures that were announced? And what they'll do for affordability, if anything?

JOHN PASALIS: I mean, I think my view is probably one that's shared with a lot of people who are trying to buy a home, which is, just exhausted of hearing these stories, because they've been in the government since-- what? 2015. As he said, house prices have doubled. And the reality is, they didn't do anything.

They're not getting rid of corporations buying homes. They've indicated they might just tax them. They're not really doing anything about foreign buyers. I mean, a lot of the policies they put in place have so many loopholes.

So they're really not doing anything on the housing front. I mean, they make a lot of promises. They've been promising a lot since 2015. But as you said, house prices have doubled. And I think a lot of people hear a lot of this talk and are just not buying it anymore, because nothing's been done in seven years.

So anyways, I think, the budget was a bit disappointing for a lot of people, because there's nothing really meaningful in that it's going to have any material impact.

JESSY BAINS: OK. Steve, what is your takeaway?

STEVE SARETSKY: Well, I just want to mention, because I think there's some misunderstanding because every media headline picked it up, foreign buyer ban. But if you actually read the budget-- so a lot of the housing policies that were brought in or proposed here actually have timelines and specific dates that are going to be introduced. The foreign buyer ban, as per the budget says-- their words, not mine-- We, quote, "intend to propose restrictions. We intend to propose restrictions."

So there's not actually any firm dates or timelines. It's just an intention to make a proposal. So is this actually going to get approved through parliament? I don't know if this policy will actually ever see the light of day.


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