Too hot for housing plan

The federal Liberals are having second thoughts about a 2015 campaign promise out of concern that expanding the popular Home Buyers' Plan would throw fuel on Canada's overheated housing markets.

An internal federal document suggests high housing prices are a key reason the Liberals don't appear to be in a hurry to fulfil an election pledge that would enable Canadians to dip back into their registered retirement savings to pay for a home.

The June briefing note offers new details on the status of the Liberal promise to expand the plan by allowing individuals affected by major life events, such as the death of a spouse, to go back to their RRSPs without penalty for a down payment.

The Trudeau government says the promise is still in progress, but faces unspecified challenges.

An accompanying explanation says the government has instead provided more support for families facing significant changes, has helped stabilize the real estate market by tightening mortgage rules and has committed $11.2 billion over the next 11 years to support affordable housing.

But the briefing note for Finance Minister Bill Morneau, prepared ahead of his meeting with the Canadian Real Estate Association, recommended he answer any questions about expanding the Home Buyers' Plan by saying policies to further boost home ownership by fuelling demand would help push prices higher.

The note, obtained via the Access of Information Act, also laid out the government's concerns that low interest rates and rising home prices have encouraged many Canadians to amass high levels of debt just so they can enter the real estate market.

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