The Homestead Act

Spring 2006 CSANews Issue 58  |  Posted date : May 27, 2007.Back to list

Good public policy should recognize and reinforce the Canadian value of home ownership. A home is the biggest single investment most Canadians make, offering Canadian families long-term security and stability. There is also a strong sense of personal pride associated with owning your own home, making repairs to improve its value and enjoying it with family and friends. Many parents and grandparents want to be able to pass the family home or cottage on to their children or grandchildren, without passing along a huge and unmanageable financial burden.

Recently however, many Ontarians, especially seniors, have expressed concern that sky-rocketing property assessments will jeopardize their ability to maintain home ownership. The average assessed home in Ontario leapt from $179,151 for 2003 taxes to $232,883 for 2006 taxes, with some individual homeowners receiving assessment increases of more than 100 per cent. Individuals on fixed incomes, such as retirees, are hit the hardest when property taxes sky-rocket. With no additional sources of income, many are forced to cut costs in other parts of their budget. Tragically, some seniors are forced to contemplate selling their homes.

Snowbirds will be well aware of how legislators in states such as Florida, California, Texas and Arizona have approached the issue: caps on assessment increases as long as home ownership is maintained.

Such a solution is currently before the Ontario legislature. Bill 75, the Homestead Act, is a private member’s bill introduced by Erie-Lincoln MPP Tim Hudak. Hudak’s Homestead Act, which has attracted support from MPPs in all three parties, is modeled on the best practices in the United States and the province of Nova Scotia.

The Homestead Act covers all residential property, including cottages, and would allow the five per cent cap to remain in place if ownership is transferred to a child or spouse.

Canadian Snowbird Association President Gerry Brissenden stated, “I applaud Mr. Tim Hudak on behalf of the members of the Canadian Snowbird Association. I thank him for his initiative in this matter. Seniors who are on fixed incomes cannot keep paying the tax increases. I am pleased to see that Mr. Hudak is speaking up on behalf of seniors.”

The CSA’s weekly radio broadcast has galvanized support behind caps on assessment increases and has helped to convince MPPs to vote for the bill. Similarly, Canadian Snowbird Association Executive Director Lawrence Barker attended Hudak’s Homestead Act press conference and second reading of the bill to show the snowbirds’ support.

While the Homestead Act has now successfully passed a second reading vote, it will still likely require the support of the premier and cabinet to achieve the crucial third and final vote in order to become law.

Readers who would like to see the Homestead Act become law should contact their local MPP. For more information on the bill, visit MPP Tim Hudak’s website at or call him at (416) 325-8454.

The primary benefits of the Homestead Act include:

  • A cap on residential property assessment increases for tax purposes at five per cent per year, as long as home ownership is maintained
  • The ability for Ontario homeowners to make up to $25,000 in home repairs, alterations, improvements or additions without facing an increase in their property assessment
  • A tax break for seniors and the disabled, who would not pay property taxes on the first $10,000 of assessed value for their principal residence.

Related links
MPP Tim Hudak’s website