Ontario, Canada brings in foreign housing tax to cool market
Apr 21 2017 by Johnny Bowman
Wynne said the Liberal government would work with the real estate industry to reduce property speculation, including the questionable practice of "paper flipping" houses for quick profit.
Wynne said the tax is not about targeting immigrants. "I call them property scalpers". The federal finance minister noted there are no imminent plans regarding Ontario's request to close a loophole on capital gains exemptions. She said that poses a challenge for locals bidding for houses that are selling for hundreds of thousands over the asking price.
Morneau's office made the invitations to Sousa and Tory public, but if any new concrete measures arrive in the coming weeks, it will likely be up to Ontario and Toronto to do the heavy lifting.
A 15 per cent tax on home purchases by non-resident foreigners.
The three agreed at their meeting that in the short term, none of the levels of government will bring in new measures for homebuyers that would further boost demand, suggesting it's unlikely first-time homebuyers will see any incentives in the near future.
Federal finance minister Bill Morneau welcomed Ontario's housing package, saying the measures aren't aimed at increasing demand, but instead look at ways to deal with speculation in the market.
The challenge for Wynne, Sousa, and Ontario Housing Minister Chris Ballard will be to introduce policies to improve housing affordability without toppling the real estate sector, which has come to represent increasingly significant slices of the provincial and national economies.
The Canadian Real Estate Association said Tuesday home sales over its Multiple Listings Service system increased by 1.1 per cent in March to top the previous monthly record set in April 2016.
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The province is also expanding rent controls and giving Toronto and other municipalities the power to impose a tax on vacant homes, something that Toronto Mayor John Tory has been pushing for.
Typically, his company only sells one pre-construction property per family, Wein said.
"That's exactly what we've seen in Vancouver", said Tal.
"The move forward with an approach to dealing with potential speculators we hope will have an impact on reducing the speculative nature of what's going on in the market", he said.
Bank of Montreal chief economist Doug Porter said where you stand on the issue of Canada's housing market depends on where you live.
The provincial Liberal government has come under increased pressure to do something about housing in the Greater Toronto Area, where the average price of detached houses was $1.21 million in March, up 33.4 per cent from past year.
"We want to make sure that whoever is speculating is in fact paying their fair share", he said Wednesday.
OFA is looking for some relief when it comes to the increase in prices of farm fuels, Currie said.