Montreal gov't not ruling out tax on foreign home buyers

Montreal mayor Valérie Plante said that the city government will consider imposing a tax on foreign home buyers if the measure will help guarantee long-term affordability.

Such a levy has already been implemented in Toronto and Vancouver, to considerable effect.

“Here in Montreal, this is not where I’m going for now, though we are really checking on the market on regular basis,” Plante told BNN Bloomberg.

“If needed, we might go there, but right now we’re using different tools that we have to make sure we have this balance of creating social and affordable housing. But for that, I need both provincial and federal help.”

For some time now, Montreal has outpaced Toronto and Vancouver in terms of home price growth, according to the latest edition of the Teranet–National Bank of Canada House Price Index.

Read more: Chinese buyers now prefer Quebec, Alberta, and Nova Scotia

In February, Montreal prices increased by 0.36% from the previous month and 5.15% year-over-year, to reach a historic high for the month. In comparison, Toronto prices fell by 0.22% from January to February, and grew by 3.56% year-over-year. Vancouver’s declined by 0.68% monthly, and shrunk by 1.11% annually.

Overall prices across Canada decreased by 0.4% month-over-month in February, and were only 1.87% larger than the same time last year.

Plante stressed that her government’s careful approach towards a foreign home buyers’ tax is needed, since in real dollar terms, Montreal is still considerably more affordable than other leading North American markets. 

“We are this big city, but people can still afford to live downtown and I do want to protect that as mayor of Montreal,” she said.

“A lot of investors are interested in Montreal, and so I need to find the right balance. So yes, I want to welcome those investments – but at the same time, how do we make sure that anyone can afford to stay in the city?”

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