Toronto seems intent on passing a land transfer tax of up to 2% by mid-July, much to the fury of its residents. That would give Toronto the highest rate in Canada, and 2nd highest in North America.
The tax equates to $4244 on the typical $380,000 Toronto home.
The tax will start in January if passed. If so, expect a lot of Toronto home closings in the last week of December.
The Real Property Association of Canada issued a press release with eight reasons why the tax is ill advised. Bob Finnigan, from the Building Industry and Land Development Association, implied that the measure is a simple “cash grab.” Toronto Star Story
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Last modified: June 26, 2007
I’m thinking this might be a good negotiation tool over the next 6 months. Tell sellers that if they don’t sell by the end of the year, its going to be harder to find a buyer with the increased transfer tax…
What a rip!
Mind you compared to the ripoff real estate fees, the land transfer tax is not as big a deal.
Mike
Very true. We’ll delve into home buying costs further in a new story tomorrow.
As a side note, the land transfer tax was the most hated of all Toronto tax proposals according to a recent Decima poll.
From politicians’ standpoints, it’s simply tough medicine for tough budget problems.
At least Toronto’s suburbs will be happy, given their new competitive advantage in home affordability.
Have a wonderful evening!
Generally, house valuese in Canada are still on the rise, but I do see that changing soon. The bad news: commodity prices are falling causing the TSX to drop considerably. The oil sands have taken big hits, as well as agriculture stocks. This will result in a decrease in housing demand in AB/BC/SK. However, urban areas might be able to avoid a decline altogether, due to immigration and more demand for western immigration. The good news is the American Dollar is on the rise and we will be seeing our exports to the US increase. This should keep the economy in check if commodities fall too much. Altogether, I would not be worried about a US styled housing crises because of the difference in regulations.
Generally, house values in Canada are still on the rise, but I do see that changing soon. The bad news: commodity prices are falling causing the TSX to drop considerably. The oil sands have taken big hits, as well as agriculture stocks. This will result in a decrease in housing demand in AB/BC/SK. However, urban areas might be able to avoid a decline altogether, due to immigration and more demand for western immigration. The good news is the American Dollar is on the rise and we will be seeing our exports to the US increase. This should keep the economy in check if commodities fall too much. Altogether, I would not be worried about a US styled housing crises because of the difference in regulations.
Everybody is trying to figure out whether or not Vancouver is going to have a major price correction in the next few months, and if so, how deep, and if so, how long before the house valuesreal estate market turns around. People are worrying about changes in the mortgage environment as a result of (a) the US housing slump and mortgage crisis or (b) the government of Canada’s reaction to (a) above, and whether those changes are going to be good or bad for the mortgage investor.