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What are they thinking?

Last night Toronto city council voted in a 1.5% land transfer tax on the sale of residential and commercial property. So what does this mean to home buyers? Starting in January the purchaser of an average Toronto home, priced at a little more than $380,000, would pay $8,488 in total land transfer fees, up from $4,244.

I am not a Realtor nor am I a tax guru but come on! How can this NOT have a negative effect on the Toronto real estate market?

Your thoughts...

Posted by Lucie Quigley on 06/26/2007 08:53 AM

Comments (10)

taxes real estate

10 Comments on What are they thinking?

JUN

2007

They the city council thinks they have better ways to spend the money than the owner would. This is most likely not the only person they like to tax. It will begin to slwo growth as a company may not decide to transfer some there. It may be a boom to the areas outside of Toronto. The council will out of office by then, the real question is where does this money go.

Lucie, I heard that the 1.5% was not definite - it could end up at 2%. I believe they also approved a vehicle license tax as well. Unbelievable.

The city of New Orleans put a transfer tax of $375 on a real estate sale. People are still talking about it and cursing the people who put it own. Most have however been convicted of various bribes and theft. They are going to prison as we speak because of a Republican Federal Attorney. This has nothing to do with your tax but things could go that way when there is this much money involved. I view this as stealing from the sellers, but thats my take on it several thousand miles away.

JUN

2007

I was very surprised when this happened, do these people not know that this is going to kill the first time buyer market, with prices in Toronto so high every penny counts and they just knocked out the whole change jar. I just hope it doesn't happen here in Kitchener/Waterloo

Can you believe that someone on the council said "If you can afford a house for $400,000 then you can afford the tax".

JUL

2007

Although the tax will certainly have an impact on the housing market as of now this bylaw has not been passed. If I am not mistaken the vote was 23 to 22 to postpone the decision.

On a positive note:

That means more people will be buying homes in other areas, like Hamilton!

(More inspections for me, **smile**) OK, on a serious note, I think it is unfair and you know it will soon be followed by other cities as well. Like there aren't already enough costs associated with home ownership. It will make a dent in everybody's pockets with a ripple effect throughout the economy.

My understanding of the tax is to assist in the lack of money to upgrade the existing infrastructure that cannot meet the expanding growth of new homes/condos being built.

AUG

2007

I agree with you Lucie. A land transfer tax increase of that size can only hurt the real estate market in T.O. I read, as Dave did, that a decision has been postponed. Hopefully they will reconsider!

We have a 1.5 % deed transfer tax in Halifax. We have had it so long i guess we are used to it. typical tax grab!

Ed of Alberta has suggested the same thing. This will further hurt families and make it more expensive to buy a home. It will also make it easier to stay in the same home and renovate.. Do they have something against the real estate industry...

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