Calls for tax breaks for seniors looking to downsize their home

CTV News

a day ago

For some seniors across Canada, downsizing doesn't make a lot of financial sense. Adrian Ghobrial on the seniors choosing to stay in their homes.
For some seniors across Canada, downsizing doesn't make a lot of financial sense. Adrian Ghobrial on the seniors choosing to stay in their homes.
CTV National News: Why so many seniors are staying in their homes
Governments must give seniors a tax break to make it more financially viable for them to downsize from their family homes, according to a report by the Missing Middle Initiative released this month.
The Ottawa-based organization suggests doing so would also open more housing supply for young families and first-time home buyers.
'If a senior wants to downsize and move into a new condo, in Ontario for example, they're assessed GST and they're assessed PST,' says economist and Missing Middle Initiative Director, Mike Moffatt.
In Toronto, some pay both a provincial and municipal land transfer tax.
In March, the Carney Government announced the elimination of the GST for first-time homebuyers on properties under $1 million.
Moffatt and others are calling on the federal government to extend the GST rebate to all who are purchasing 'owner-occupied homes' and for provincial governments to match that rebate with incentives of their own.
'If that happened, it would shave up to 13 per cent off the cost of new homes' shares Moffatt.
In an email, CTV News asked the federal government if they would consider the extension.
'This GST rebate is intended to help first-time home buyers enter the housing market, rather than people who already own a home,' an official for the Department of Finance replied.
Effie Panagiotopoulos' parents, who are in their mid 80's, live in a two-storey, four-bedroom home in Toronto's east end, which they built in 1988.
Panagiotopoulos, a real estate agent who specializes in helping seniors downsize, says it would be a financially questionable decision should her parents move into a bungalow that would be better suited to their needs.
'It doesn't add up -- pay all those expenses to move from a two story to a bungalow. I mean, the (price difference) is not that big. So where do they go? Do they leave the city? Leave family and friends?' Panagiotopoulos tells CTV News.
Like many aging Canadian couples, Panagiotopoulos' parents have also had to navigate unexpected expenses due to her mother's deteriorating health.
Anna Panagiotopoulos, 85, was diagnosed with dementia five years ago. The couple have had to retrofit their family home with a lift for the staircase, among other items they've had to purchase to help caregivers move her mother around her home.
Her daughter admits that for her parents to make the move and downsize, it must be their own choice.
Though whether it's a real estate client, or her parents, the younger Panagiotopoulos shares that she sees it everyday.
'They (seniors) want to make a move, many times they need to make a move, but they're looking at all the costs involved, and it simply isn't worth it for them. They've paid taxes their whole life, they need a break so they can downsize and still live comfortably,' she said.
The Canadian Centre for Economic Analysis estimates that there are 4.4 million empty rooms in Ontario alone, in part because of seniors and empty nestors who won't, or in some cases, can't afford to downsize.
Moffatt believes that 'one way to help first time home buyers, is to help seniors downsize with incentives, because the senior who downsizes from their suburban home, frees up that home for the next generation of families,' while creating more supply for the housing market as a whole.