Could Poilievre’s Capital Gains Tax Break ‘Shut Young Canadians Out Of The Market’?

​Pierre Poilievre’s proposed capital gains tax deferral has sparked debate over its potential impact on young Canadians trying to enter the housing market. The policy would allow investors to defer taxes on profits from selling assets—such as stocks or properties—if they reinvest those profits into Canadian businesses or real estate. Poilievre argues this move would unlock capital currently tied up due to tax concerns, encouraging investment in sectors like housing, technology, and manufacturing.​

Real estate developers have expressed support for the policy, suggesting it could motivate property owners to sell, thereby increasing land availability for development. Chris Spoke, a partner at Toronto Standard, noted that the current capital gains tax discourages sales, as owners prefer to hold onto assets to avoid hefty tax bills. By deferring taxes on reinvested gains, more properties might enter the market, potentially boosting housing supply.​

However, some experts caution that the policy might inadvertently exacerbate housing affordability issues. John Pasalis, President of Realosophy Realty, warned that the tax deferral could incentivize wealthy individuals, particularly Baby Boomers, to sell existing assets and invest in single-family homes as rental properties. This surge in investor activity could drive up home prices, making it even more challenging for young Canadians to purchase homes.​

The concern is that increased investor demand could outpace the benefits of added housing supply, especially if new developments cater to higher-end markets. This dynamic might further entrench the trend of homes being owned by investors rather than families, potentially sidelining first-time buyers.​

Poilievre's policy is currently proposed as a temporary measure, set to run until the end of 2026, with the possibility of becoming permanent if deemed successful. As the federal election approaches, the debate over this policy underscores the broader discussion on balancing investment incentives with housing affordability.​

While the tax deferral aims to stimulate economic growth, its implications for the housing market remain uncertain. Stakeholders will be closely watching how this policy unfolds and its real-world effects on both investment patterns and housing accessibility for younger Canadians.