Deconstructing Ontario's Fair Housing Plan

Premier Kathleen Wynne announced the new speculation tax on Thursday as part of a series of measures to help stabilise the price for property and for rental units in and around Toronto.

Toronto prices rose 33% in March from a year earlier and the average price of a detached home topped C$1.2mn ($903,000) last month.

Numerous measures were reported earlier today by CBC's Queen's Park reporter, Mike Crawley, before they were outlined by Wynne.

Kavcic expects Ontario's foreign-buyer tax will have less of an impact on the GTA market than BC's did on Metro Vancouver as the share of non-resident home purchases is lower here.

The 16 measures will also fundamentally change the province's rental housing market by imposing rent controls on all units.

A rebate of development cost charges to encourage building of more rental housing.

Mamourian thinks that the foreign-buyer tax could slow pre-construction condo sales.

Toronto's surging real estate market has triggered debate over whether non-Canadian speculators are bidding up homes and fuelling unsustainable record price gains, or if a lack of housing supply and inadequate urban planning is more to blame.

In a bid to cool the red-hot luxury residential market, Vancouver imposed a punitive 15 percent tax on foreign buyers in the city.

Sousa and Morneau have jockeyed back and forth over who is responsible for the increasingly feverish market, and appear at odds over whether a tax on speculation or foreign investment is the best approach.

- A plan to ensure property tax for new apartment buildings is charged at a similar rate as other residential properties. Rent increases on newer buildings may be limited to about 1.5 percent above the inflation rate, which was at 2 percent in February, the Toronto Star reported.

"Ontario is a welcoming place", said Wynne.

The Greater Toronto Area may be the focus of federal Finance Minister Bill Morneau's meeting with his provincial counterpart and Mayor John Tory on Tuesday, but a city more than 4,000 kilometres away could be top of mind, according to a leading financial expert.

"That's exactly what we've seen in Vancouver", said Tal.

"The timing (of Wynne's plan) is most disappointing given that it's our spring market and we also have a real uptick in the last 10 days in terms of inventory", said Dianne Usher, senior vice-president of Johnston and Daniel, a division of Royal LePage. The price increases reflect confidence in Ontario's economy, but when young people can not afford homes "we know we have a problem and we know we have to act", she said.

What else do you need to know about "Ontario's Fair Housing Plan?". Another measure will see the province working with local municipalities to earmark surplus Provincially-owned lands for new affordable and rental housing projects.

- The launch of a housing advisory group which will meet quarterly to provide the government with ongoing advice about the state of the housing market and discuss the impact of the measures and any additional steps that are needed.

The province also indicated that they have a number of things on their To Do list including looking into assignments of new construction properties and providing more transparency into real estate transactions.

- Set timelines for elevator repairs to be established in consultation with the sector and the Technical Standards & Safety Authority.

Since Ontario has the largest population of any province, it also has the advantage of economies of scale when delivering public services.

  • Zachary Reyes