Foreign buyers’ tax in GTA an ‘un-Canadian’ move - mortgage industry

by Ephraim Vecina03 Apr 2017

A national group of mortgage professionals recently slammed the various proposals calling for a foreign buyers’ tax in the GTA’s overheated housing sector.

“Imposing a foreign buyers’ tax does nothing to solve a lack of supply and could create adverse effects on the national, provincial and regional economies,” Mortgage Professionals Canada said, as quoted by BuzzBuzzNews.

“It is un-Canadian to blame foreigners for affordability concerns caused by lack of supply in the market.”

The organization is the latest in a growing chorus of voices that includes developers, real estate agents, and current Ontario Real Estate Association president Tim Hudak—all in staunch opposition against the implementation of such a levy.

More importantly, an additional tax on residential property purchases in the GTA would make it difficult for the Ontario government to balance its 2017-18 budget, as the levy might end up restricting sales activity. The province’s land transfer tax in 2016 added $514 million to its coffers.

MPC pointed at the relatively muted effect of British Columbia’s foreign home buyers’ tax, which was meant to cool down Vancouver. The province imposed a 15 per cent tax on non-resident buyers of homes in mid-2016.

“A foreign buyers’ tax has not improved affordability and has instead simply reduced housing activity,” MPC said.

Latest numbers from the Real Estate Board of Greater Vancouver bore out this claim: Last month, only 3,666 homes were listed for sale in Metro Vancouver, representing the lowest February supply levels since 2003.

Related stories:
Broker: Housing cooling measures likely coming
Red-hot Toronto a source not just of profits but also of dismay for agents

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