From what I have read, the demand for cottage properties has
soared during COVID. City folk are eager to get out of the city for
a change of scenery, especially since many people are still working
from home. So the idea of having your laptop set up on the dock of
your second home is definitely appealing. And if you are on the
selling side, you likely have benefitted from the high demand for
properties. And a question I get from both purchasers and sellers
is whether the principal residence exemption can be used to shelter
the capital gain on a cottage property. The short answer is yes,
it's possible.
So I thought it would be worthwhile to go through a refresher of
the rules as they relate to the principal residence exemption.
