Ontario set to slap foreign buyers tax to cool Toronto property market

Ontario set to slap foreign buyers tax to cool Toronto property market

If legislation passes, the tax would be effective retroactively to April 21.

The most recent possibility floated by the Ontario government is a "non-resident speculation tax", but the province hasn't yet said how exactly that tax would work. The Federation of Rental-housing Providers of Ontario (FRPO) said it's disappointed and concerned with the proposed changes because they were made "without formal consultation" with the industry responsible for rental housing.

Ontario's provincial government said it will apply a 15 percent levy on non-Canadian citizens, non-permanent residents and non-Canadian corporations buying residential properties containing one to six units in the greater Toronto area. "They are only looking for a quick profit or a safe place to park their money", she said.

After two consecutive years of double-digit gains, the price of an average house in Toronto jumped to C$916,500 ($925,600) last month, a 33 per cent increase on the year-earlier month; the average price of a detached home topped C$1.2 million.

Experts say measures introduced by the Ontario government to cool the red-hot housing market are likely to leave a lot of the buyers on the sidelines as they await to see the impact of the changes.

"When young people can't afford their own apartment or can't imagine ever owning their own home, we know we have a problem", Ms. Wynne said.

Another major element in the province's plan is the expansion of rent to control to cover all private rental units, closing an existing loophole that limits rent control to buildings constructed before 1991.

Home Capital's stock dropped 19 percent to C$18.10 at 1:56 p.m.in NY, the biggest decline in nearly two years.

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Today, I met with Bill Morneau, Federal Minister of Finance, and John Tory, Mayor of Toronto, to discuss new ways to collaborate to address rising housing and rent costs, and share information across jurisdictions. I am pleased that the government will activate surplus provincial land like the West Don Lands to create new affordable housing, something I have been urging the Premier to do for some time.

Other government actions included in Ontario's Fair Housing Plan include plans to make it possible for Toronto to apply a vacant-home tax and even setting a timeline for elevator repairs, which can be a headache for high-rise dwellers.

Premier Kathleen Wynne's Liberals are widely expected to reveal housing policy measures when Sousa issues his budget on April 27.

There will be a new five-year $125-million program to encourage the construction of new r‎ental apartments by rebating builders a chunk of development charges.

The news release continued to state that FHP lists a set of 16 comprehensive measures, which in addition, to stabilising real estate market in enabling more people find an affordable place, would also protect interests of renters and the investment of homeowners. That kind of tax would discourage speculation and make it more expensive to "flip" homes, he said.

This comes as policymakers complained that Canadian data on real estate transactions is lacking compared to other jurisdictions.

The plan also includes establishing timelines for elevator fix so that they aren't broken so often in condos and apartments.

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