Real-estate company to build 5,000 new rentals as government eliminates GST on rental developments
A Toronto-based real-estate company says it is planning to build 5,000 new rental units in urban centres across the country as a result of the federal government's decision to eliminate GST charges on rental developments.
The CEO of Dream Unlimited, Michael Cooper, says high interest rates and construction costs had put many projects on pause.
But the federal government's announcement that it would eliminate GST charges off rental developments _ and the expectation that provinces would follow suit _ has changed the calculation.
Finance Minister Chrystia Freeland introduced legislation last week that would provide a 100 per cent GST rebate for new rental developments.
Housing experts, advocates and developers who say more incentives are needed to spur purpose-built rentals have been calling for the measure.
Cooper says the full rebate is a game-changer because while retailers can pass on the cost of a sales tax to customers, rental developers have to pay the tax themselves.
The announcement from the real estate company comes with a caveat, though: provinces would have to waive their sales taxes, and average interest rates would have to stay the same.