We shoud tax short term capital gains on property at 100 percent. Nobody should be able to profit by driving up the cost of housing.

The whole justification for the mortgage interest write-off (which is otherwise just a gigantic government handout to property owners), is that it promotes home ownership, the family unit, etc. The problem is, there's no equivalent dis-incentive for short-term speculation on property, and what was intended to be an incentive for family home ownership actually helped to fuel the ponzi scheme that is effectively driving families out of their homes today.

If short-term gains on home sales were taxed at very high rates, it would basically be impossible for "investors" to flip homes for short-term profits. A huge incentive for speculative price increases in the housing market would be eliminated.

(Plus, no more stupid TV shows about house flipping. It's win-win!)

The government got into the home-loan business under the pretense that it needed to encourage home ownership to promote community and stability. Then, it allowed flippers to go crazy speculating on home price increases, and effectively subsidized the process via Fannie and Freddie. If we had been taxing short-term home owners at a rate near 100% of their profits, it would have killed the flipping market dead, served to keep home prices in check, and encouraged the values that the agencies were designed to uphold.

(Problem is, of course, that this never could have happened -- for the last three years, the sole pillar of our economic growth has been home price increases. There's no way that congress or the White House would have allowed that pillar to be knocked down. Everyone is conveniently forgetting this today, but it's still true.)

Owning your home is meaningless if you can be priced out of it while just living there. Making people come up with money because they have an asset that can't be readily turned into money is silly when you can just tax money.

This is backwards. Such a tax will be a strong incentive to never ever sell since the seller would hand off all gains to the tax man. Who would want to sell?

Instead, you'd want to actually incentivize selling if you're not living on the property. Make the capital gain tax very low, that makes selling it off the most attractive option.

It is unfair to renters because renters do not have an equivalent 100%, completely unlimited tax-free investment vehicle. We have Tax-Free Savings Accounts, limited to ~$5k contribution per year, and we have RRSP's with max contributions scaled to income, but homeowners have access to all those things too, and they are limited. Homeowners can take advantage of TFSA, RRSP, and then shove all of their remaining savings into maxing out their home purchase and enjoy all of their gains completely tax free. Renters have to start paying capital gains at an inclusion rate of 50% once they max out TFSA/RRSP.

This system is completely unfair and places a higher tax burden on renters who are, on average, less wealthy than homeowners. It encourages us to spend more than we should be on housing just to get around taxes, and discourages investing in actual productive things like innovation/companies.

No capital gains isn't necessarily a great system either. It leads to people treating their primary home as a retirement savings vehicle.

Taxing inflation-adjusted capital gains on home sales is a sensible compromise. And maybe also allowing the gain to be divided over years of ownership.

The principal residence tax exemption is also a joke but I also understand it's political suicide to try and get rid of it and at this point, since so many people have their life savings tied up in real estate, you'd probably be causing more problems by removing it.

The raised taxes could be earmarked for building (gasp!) public housing. The stuff we used to build until the 90s, when it suddenly became absolutely unpopular and politically toxic for governments to encourage affordable housing stock.

That these kinds of policies can't/won't happen tells you that the foxes are running the hen house in this country, at every level of government and business. E.g. the response to affordability crisis is more stimulus and subsidies (new tax free home buyers accounts, etc), rather than getting pricing under control by building homes and regulating real estate law.

All very frustrating.

Instead figure out some way of differentiating between a house as primary residence and a house as investment, and tax former less and the latter more.