The foreign buyer tax initiated in Vancouver is becoming a pleasing idea for many and Councilor Jim Karygiannis on Thursday expressed his liking of the tax stating that he will be writing the Ontario Premier Kathleen Wynne to implement the tax on foreign buyers in Toronto.
According to Karygiannis, the foreign buyer’s tax is just one of the many alternatives Toronto has to control the current housing prices.
Last August, the British Columbia government in an effort to address the high real estate prices in Vancouver imposed a 15% tax on foreign buyers and also made new mortgage policies.
In 2016, Metro Vancouver became the priciest real estate market in Canada, followed by Toronto. But after the new tax was implemented, there was a drop in prices during the final quarter.
This drop according to many real estate agents implied that foreign buyers really do have a hand in the home prices. Although there are conflicting opinions about the influence of foreign buyers in the Canadian real estate market, one thing is sure. The tax definitely had an effect on the home prices in Metro Vancouver.
But sadly enough, the real estate market in Toronto is following the footsteps of the expensive Vancouver city. Data from the Toronto Real Estate shows that the average home price in the Greater Toronto Area has increased to $730,000 which is a 20% rise from 2015.
But for some home experts, they are against the idea of Toronto imposing a tax on foreign buyers and stated that it will have a “knee-jerk” effect. But if the tax will help bring down the housing prices in Toronto and prevent it from reaching the Vancouver high home prices, then it won’t hurt anyone.
And presently, Toronto does not have many options to choose from as resident s has long been driven away from the real estate market.
But for some, even though the tax will help cut down on the demand pressure, it will definitely not increase on the supply on new homes. And with the issues of housing affordability, it requires more than one solution to address the problem.