In toronto real estate, with concerns rising that a new housing tax in Vancouver could further drive up prices in the Greater Toronto Area’s already hot real estate market, Ontario’s finance minister isn’t ruling out a similar tax here.
“Our government understands the importance of concerns related to housing affordability and ensuring a stable housing market,” Finance Minister Charles Sousa said in an email to The York Region Media Group Tuesday.
“Our government will continue monitoring the housing market in both Ontario and B.C. over the course of the next few months to see the impacts of the recent decision by the government of B.C.”
On Tuesday, provincial legislation came into effect in British Columbia charging foreign buyers a 15-per-cent tax on homes in Vancouver, where prices are among the highest in North America.
The tax on a house selling for $2 million is $300,000.
Experts believe many foreign investors looking to avoid the tax will look east for houses in the GTA instead.
Housing prices in the GTA jumped 16.8 per cent in the last year to an average of $746,546, according to the Toronto Real Estate Board.
In York Region, prices were up 20.61 per cent.
While there is limited data available on foreign investment in the GTA housing market, a Canadian Mortgage and Housing Corporation report said the share of foreign ownership of condos in the Toronto area was 3.3 per cent last year.
In this year’s budget, the federal government allocated $500,000 for Statistics Canada to develop methods for gathering data to get a better handle on the level of foreign ownership in the Canadian housing market.
Ontario is participating in a working group on the housing market, along with the federal government and the cities of Toronto and Vancouver, Sousa said.
The group will examine several options, including the possibility of Ontario implementing a similar tax to Vancouver’s.
All levels of government have a role to play in addressing issues surrounding the red-hot housing market, Sousa said in his email.
“Ontario’s housing market remains an important source of economic growth and employment in the province,” he added.
“Strong job gains, low interest rates and growth in the number of households have been supporting strong house prices gains in the Ontario housing market.”
There may be some relief in sight to counter skyrocketing housing prices, Sousa said.
“Looking ahead, most private sector economists expect a soft landing in the Ontario housing market. Home price appreciation is projected to ease over the next few years as interest rates rise gradually while construction activity is expected to continue in line with demographic demand and solid income growth,” he said.
“We value diversity among Ontarians and in Ontario communities and it will be important to ensure that policies intended to promote housing affordability do not create any unnecessary walls that prevent newcomers from contributing to our society. We remain open to options that would help relieve the burden of housing affordability and make everyday life easier for the people of our province.”
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