According to figures released by the Government of New Brunswick in its May 2021 housing report, 30% of property purchases were made by out-of-province businesses in 2020, up from just 7% a year ago. five years.
Building owners are changing, with more out-of-province developers and property management companies
Can we read in this report.
Pay more or leave
He says the impact is huge on low-income families Matthew HayesD., professor of sociology at the University of New Brunswick and spokesperson for the New Brunswick Tenant Rights Coalition. Many affordable units are disappearing and tenants are faced with a heartbreaking choice: pay more or move and risk not finding a new home.
Mr. Hayes cites the example of the company Killam Properties. unités. Ce repositionnement, ça veut dire qu'ils vont prendre des édifices ou des unités de location qui sont moyennement abordables, et ils vont les augmenter","text":"[Ils ont] un projet pour repositionner 1300unités. Ce repositionnement, ça veut dire qu'ils vont prendre des édifices ou des unités de location qui sont moyennement abordables, et ils vont les augmenter"}}">[Ils ont] Return project of 1,300 units. This repositioning means that they will take buildings or rental units at fairly reasonable rates, and increase them
to complain.
the Executive Director the company, Phillip FraserHe replies that his company does not evict its tenants to raise rents. I’m sure there are a few who will, but we’re very happy to have tenants who want to live in our buildings for as long as they want.
However, the Executive Director From murder You realize that about a third of tenants leave – of their own accord – every year. In these cases, rent increases may be larger. It’s not that you hurt anyone by raising the rent.
he thinks.
However, this type of increase also contributes to reducing the number of affordable housing units in a neighborhood, city or town.
Excellent support for financial institutions
To improve access to property, the federal government has offered a financial product since the 1980s that allows banks to offer more mortgage loans. here CMHC Who is responsible for this.
These are securities, consisting of mortgage loans, which CMHCsecured and sold to investors. This process is called securitization.
securitization
the CMHC It buys blocks of mortgages from banks. These loans are resold in the form of securities to the investors, yields are given to them, which are paid on the repayments made by the borrowers. This gives banks liquidity, allowing them to provide more mortgages.
From 2001 to 2020, annual titles are issued by CMHC From $8.9 billion to $172 billion.
Through securitization, consumers are buying more homes, yes. But increased sales have also created upward pressure on prices, which have risen in recent years, says Steve Pomeroy, who teaches at Carleton University’s School of Public Policy and Management.
” You can say that real estate prices are very high due to government policies. »
Ten years ago, in 2012, the Institute for Social and Economic Research and Information sounded the alarm. In a report, the organization noted that in In addition to subsidizing real estate development that undermines housing affordability, these practices stimulate the growth of family debt.
.
Reduced access to property
As a result, fewer and fewer families can access home ownership. These families, many of whom have good incomes, often have no choice but to rent an apartment. This contributes to increasing the number of tenants looking for accommodation.
Access to the property is more difficult.
Photo: Julian Lechashore
We are witnessing a domino effect, warns Willie SchultenFrom the New Brunswick Apartment Owners Association.
There are not enough units. The pressure is that people who live in more luxurious apartments have to choose more modest apartments, etc. Ultimately, this pushes people to the streets and creates affordability issues.
thought mr. molten.
Big tax breaks
The federal government allows real estate investment trusts, REITs, to not pay income tax, unlike other trusts. Shareholders only pay taxes when they receive a dividend.
growth for real estate investment fund It was amazing. They owned no homes in 1996, and they owned 200,000 in 2020.
These funds receive their funding from investors. One of the growth strategies real estate investment fund It is a “repositioning of housing”, that is to say an increase in rents.
Tenants want politicians to act to protect tenants rather than directly subsidize housing construction by for-profit developers.
Photo: Radio-Canada
Phillip Fraserthe Executive Director From Kilam Rit Apartment, is one of the largest owners in Canada. confirms that real estate investment fund Pay more than their share of taxes. He believes that property taxes and taxes paid to governments are too high. According to him, 40% to 50% of his company’s expenses are related to the payment of taxes and royalties.
Despite these fees, the net income murder It is experiencing strong growth. In its fourth quarter 2021 report, the company reported a 95.5% increase in net profit compared to 2020. It nearly doubled.
if real estate investment fund Benefits, however, are not the only homeowners who benefit from the Canadian tax system, according to Steve Pomeroy: There are many ways to avoid taxes if you have a good accountant and a good tax lawyer
.
Which confirms Executive Director From murder. Hardly anyone pays corporate income tax in Canada for apartments
trust.
