Alright. So the federal government just released their most recent federal budget for 2022, where they addressed a ton of things for the Canadian economy, Canadians in general, and Canadian housing. Now, some of the huge announcements specifically to housing are exactly what we're going to address. We're not going to go into super depth. We're going to address those in subsequent posts moving forward.
However, this video today is all about an overview of what they announced in relation to housing, and we will get into all about how it affects you in other videos. What's good, everybody. It's Darin Germyn from the Germyn Group, where we know you've only got one chance to either buy or sell your next home. So we're here to help you get it right.
Okay, let's get into it. So we all knew that this was coming. There was going to be a lot of talk about housing in the newest federal budget because housing is a really big deal right now. We've seen escalating home prices all the way across Canada. There's not many areas that have been immune to this escalating home price, and in fact, it's kind of a worldwide trend. However, the government has a responsibility to make sure that Canadians like you and me have basic access to homes. So they've tried to address a lot of these things in the newest federal budget. Some of them are great, some of them get a passing grade, some of them are great ideas, and some of them get a failing grade because they're just kind of sound bites. But that's for another video.
We're going to go into all of those other things in subsequent videos, as mentioned earlier. But for today, here is a rundown of some of the changes that you probably want to know about. Let me caveat first before I jump into those, though, that none of these changes are happening as of today. This is all just kind of ideas and what they will be working towards over the term of their mandate and into the future. So you don't necessarily have to worry about some of these right away.
Okay, let's get into it. Ottawa is going to provide up to $4 billion to produce up to 100,000 new homes over the course of the next 5 years. This is a pretty substantial number of homes that they're going to be working to add, so that's pretty awesome. Of course, housing doesn't get built super fast. We need those today, not within 5 years, but certainly better than nothing.
They're also going to be investing $1.5 billion in helping out with what they're calling affordable housing. They're going to be working to add 6,000 units over the course of the next 2 years. Now, what is affordable housing? They don't really have a definition of that, so who knows? But this is also good because in of all the G7 countries, we actually ranked #6 in terms of housing available for our population.
This isn't probably a number we should be proud of. And mind you, we are close to number #5 & #4 position as well. But certainly we want to be the leaders on this. So kudos to the government of Canada on putting that forward. There is also something called a multi-generational tax credit, and this is for people who want to maybe have their parents move into them where you can have about a 15% tax credit on up to $50,000, which the math on that is about $7,500 worth of a tax credit to add a secondary suite to your home to have multiple generations living under one roof.
So kind of cool. This next one I think is really awesome and a really great idea. So starting in 2023, there is going to be an account for first time home buyers that works somewhat similar to both your TFSA and your RRSP. This is an account where you will be able to save up to $40,000 or up to $8,000 per year, but it's also going to be tax free and grow tax free and you can remove it and put it towards your new home. This is completely specific to buying your first home, but a pretty cool vehicle because unlike using your RRSP money where you have to actually repay that money you borrow to put towards your first home, eventually, at some point you don't have to do this with this account.
So that's kind of cool. They've also extended their home buyers incentive plan where they can become a proportional owner of your home and kind of help with the down payment. So this program wasn't widely adopted and they're looking at ways to help improve that, but they've extended that until 2025. So as an example, the Government of Canada will now help with down payments up to a certain percentage of your home. But that means they also take a proportional ownership of your home.
It is kind of a cool idea. It's not widely used. We've seen lots of programs like this in the past where either the BC government or the federal government has used these and not many people take advantage of them. But certainly it's going to help some people out there. So that's kind of cool too.
The next one is very interesting. It's going to change the game a little bit as well, where they are looking at removing the principal residence tax exemption on capital gains on a property that somebody buys. If they sell that property within twelve months of ownership. This is to prevent property flippers, especially in hot markets that pick up a property and maybe either wait for the equity to grow or they significantly renovate the property and then go ahead and resell it on the market looking to make a profit. The problem in the past was it was easy to argue that a home was your principal residence and you just decided to sell it for whatever reasons that might be.
But this is going to add some more concreteness to those decisions. And a lot of these people who were buying homes and selling them in under 12 months are now going to be subject to paying taxes on their profits. There, of course, is going to be some ways that that is not going to apply for people like maybe a death in the family, a disability, having a child or divorced, but they're going to sort all that out. But this is a very interesting one, and I think is pretty great actually for getting the house flippers out of the market and helping normal people buy homes that they can keep. One that's actually quite interesting is a total moratorium on foreign ownership in Canada over the next 2 years.
So this means anybody that is not a permanent resident or a Canadian citizen can't buy real estate anywhere in Canada. Now, of course, there are some exceptions to this. One of the interesting ones that they put on there was recreational properties are likely going to be exempt from that. So anything that is outside of maybe a big suburb or a big city might not be applicable for this type of thing. But who knows what it's actually going to look like.
None of this stuff has been implemented yet. It's just kind of an idea. Of course, lots of provinces have tried doing this in the past, more so with taxes to kind of deter foreign ownership, but it's one of the first times that an outright ban has come on. This is similar to what New Zealand has done as an example. It didn't really fix their housing problems.
To me, it's more of a soundbite for the locals to go rah rah,rah but not necessarily a bad idea. And something we will dissect in a later video if we're going to talk about game changers, this next one is a definite game changer, and this will be the focus of my most recent or quickest video to come out after this one. So definitely make sure you subscribe and stay tuned. But this is taxing the sale of Assignment properties. This is huge, folks.
You're definitely going to want to understand this one. So what an assignment is is when a buyer goes and buys a new construction property off a developer that could be completing at any time between now and sometimes up to five years away, and they buy it at today's prices. Well, the idea is whenever that property is ready to complete and be moved into, the price is going to go up. And what people do in between there is sell the rights of their contract to a new buyer. And that's called an assignment.
This is where people get to experience what we call in the industry a "lift." And that is the difference between what the first buyer paid and what the second buyer pays. The difference between that amount is actually what goes to the first buyer or the assignor. Currently, sales taxes don't apply to this first buyer in this case if they originally intended to live in the property, which in many times, especially in Metro Vancouver, is not the case whatsoever. This obviously creates a lot of room for people to be dishonest about their intentions and whether they originally purchased these homes to be their principal residence.
But as of May 7 of this year, that's very important. As of May 7 of this year, this is going to kick in and everything that is assigned will now be taxable. And it looks like it will be with GST for us in British Columbia, or HST for any of the other provinces out there that have HST. This is huge and is really going to dissuade people from doing assignments for profitable purposes. So very interesting.
We'll unpack that in another video. So make sure you stay tuned. The last one that I'll probably leave you with is doubling the home accessibility credit. So as people age, they need to upgrade their homes for things like walk in bathtubs and whatnot. And they can spend significant amounts of money doing that type of work.
So they could spend up to about $20,000 and see a tax rebate of up to $3,000 for doing those types of renovations to their home. Now that's only good, though, if these people have income to begin with, because you can't write off a tax if you don't have any necessary income to write it off again. So who knows if that one is good or not. I mean, we can unpack that a little bit later as well, but that is kind of the gist of what was released for housing in the most recent federal budget. There was, of course, lots that I went over there, but very interested to know what you guys think.
Make sure you comment below and let us know what you think of these things. And again, stay tuned for more videos on the specific items mentioned in this video and whether they're really going to make a difference or not, or if it's all just hype. Lastly, I'll leave you for with those of you out there that are looking at selling your home, the market is definitely changing. You're going to want to pick up a copy of our PDF, 4 things you can do in a weekend to increase your home's price about 5%. We Dove Super deep on these details, you guys, to make sure it was incredible information.
So if you're thinking of selling your home you want to pick that up. And for any of you looking to buy a home out there, maybe it is your first home. You want to grab a copy of our PDF for people just like you. This one is kind of fun because it's called 6 things that first time home buyers screw up and how to avoid doing so. Make sure you grab a copy of that as well. It's going to really help you out if you are looking at getting into your first property.
That's it for me guys. I'm Darin Germyn with the Germyn Group. We appreciate you staying tuned and you know why? Because you've only got one chance to either buy or sell your next home. We're going to help you get it right.