Ontario housing measures to deal with speculators, supply, rental issues

Real estate 'Sold' sign

But then demand continued to drive prices up and recently the market appears to be almost as over-heated as it was before the tax. In British Columbia alone, these feelings were even stronger, with 75% in support of the tax and 74% believing foreign buyers were driving up the cost of real estate.

The average price of detached houses in the Greater Toronto Area rose to $1.21 million last month, up 33.4 per cent from a year ago, but Wynne says the issue extends throughout the Golden Horseshoe area.

Experts say measures introduced by the Ontario government to cool the red-hot housing market are likely to leave a lot of the buyers on the sidelines as they await to see the impact of the changes.

"The problem is red tape in the development industry and we just are not producing the units we need so the units that are available people are paying out-of-world prices to get those", he said.

The government is also planning on extending rent control to all private rental units, including those built after 1991. Over the past ten years, the annual rent increase guideline has averaged two per cent.

Tenants groups welcomed the move. We should have 30,000 new rental units a year coming on stream.

Ontario is also giving Toronto and other interested municipalities the power to impose a vacant homes tax to encourage owners to sell or rent such spaces - something Toronto's mayor has been pushing for.

Moments after introducing a package of measures created to cool the GTA's red-hot housing market, Premier Kathleen Wynne conceded she's open to doing more if her plan doesn't work.

"Right now in terms of the purchasing of a home, the really hot, frantic market is in the Greater Golden Horseshoe and. we have to consistently assess what happens when we bring in the package of initiatives and what happens going forward".

Minister Sousa considered the hike in property prices as good news but the government has become increasingly concerned about rapidly rising rents and housing prices, and their impact on people looking to find a home.

Neither of Ontario's opposition parties objected to any of the government's proposed measures.

Foreigners who buy homes in Toronto and its surrounding area now face an additional 15% tax - echoing a recent measure adopted in Vancouver - as part of a slew of measures aimed at tempering a heated housing market that ranks as one of Canada's most expensive. The proposed legislation includes expanding rent control, incentives for those who build rental housing and new tools that will allow Toronto city council to follow Vancouver's lead in imposing a tax on vacant homes.

Strengthen the Residential Tenancies Act, including a standard lease with multilingual information, tightening provisions for "landlord's own use" evictions, and ensuring adequate tenant compensation if evicted.

Use surplus provincial land assets across the province to develop new and affordable housing.

The 16 measures include the imposition of a 15% foreign speculators tax and closure of a loophole that allowed landlords to raise rent by any amount on units built after 1991.

For example, lowering or eliminating the usurious, double whammy land transfer tax charged by both the provincial and city governments that adds tens of thousands of dollars to the purchase price of a home.

It will also introduce a C$125mn ($93mn) five-year programme to encourage construction of new apartments.

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