Election Promises – Harper’s First Time Home Buyer Plan Is Garbage! [Video]
Prime Minister Stephen Harper announced this week that his government if elected, would help out first time home buyers by introducing a $5000 tax credit, to be rolled out over four years (whatever that means). While on the surface the “simple, modest and practical” plan sounds good (woot, $5000 from the gov’ment!) when you look at it it’s kind of bass-ackwards, and not that much money. Closing costs for a buyer of a property can run into the thousands of dollars, when you factor in appraisals, inspections, lawyer fees, title insurance and/or survey, and the Provincial property purchase tax. Harper’s tax credit would reduce your taxable income by a maximum of $5000, which translates to a maximum cash benefit of $750. And it comes in March or whenever you file your tax return. “Gee, thanks for the help last year when I bought my house and actually needed the money then.“
I think the people who should be making election promises to first-time home buyers should be the Provincial governments. Here in BC, the government collects a tax of 1% on the first $200,000 and 2% on the balance for doing nothing. There is a first-time buyer exemption, but not everyone qualifies. I didn’t, my sister didn’t. Lots of my clients don’t. Obviously, this is a huge cash cow for the government and they’d hate to see it go, but it needs to be reduced or phased out.
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