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Deep Cove real estate and the federal budget


Blog by Patricia Houlihan - Personal Real Estate Corporation | April 11th, 2007


I keep meaning to blog on this but I am so traumatized by it that I think i have been blocking it out!  I summarized the federal budget as it affects real estate a few weeks ago; however at that time, I only talked about what the budget DID do, not what was expected but never realized.  One of the changes that I was personally hoping for never materialized.

The federal government had, as one of the election promises, said that it would allow capital gains deferral on investment properties. This would have allowed those of you who, like myself, have been holding onto investment properties which you would like to sell in order to avoid paying taxes on the investment gain.  The campaign promise was anticipated to allow investors to sell investment properties and not trigger the tax provided that they reinvested within the next year-something that most real estate investors are likely to do in my experience.  I personally had just wanted to sell one waterfront recreation property and one residential investment property to reinvest in something new.  I generally hate to leave a lot of money on the table once a property has appreciated and would prefer to sell and buy something else....but unfortunately this is not going to be an option at this point.   The Canadian Real Estate Association has been lobbying for this change and points out that this holding pattern exhibited by small investors not wanting to sell their properties and trigger tax is unduly influencing typical market activity. They argue that changing this taxation system would trigger economic activity....not that we necessarily need it right now but it does seem logical that if one just wants to relocate investment dollars, the government shouldn't really need to take a big chunk out everytime (what am I saying! have I not heard of the BC Property Purchase Tax...that is a topic for another blog!)