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Institute argues against foreign buyer tax

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Justin da Rosa | 17 Apr 2017, 08:15 AM Agree 0
Vancouver’s tax influenced a 40% drop in transactions – but it wasn’t just foreigners who accounted for that cooling, according to one research institute
  • Ian Hocking | 17 Apr 2017, 11:34 AM Agree 0
    Well seriously, wasn't that the whole point. The idea was to exactly lower prices and stabilise the market, which it did. Also, a 4.5% drop in prices following several years of rampant speculation is a mere blip and could hardly be called a disaster. Local owners who want to sell are 20-30% ahead over the past few years, to somehow suggest that a 4-5% drop is wreaking havoc is nonsense. The opposite is to leave as it was and watch people buy a home, leave it vacant and try to flip it 6 months later, which is exactly what is happening in the GTA and north GTA market right now. Yes I know if a local person paid for a home and hit the top it's not going to be wonderful in the short term, but let me suggest this; this slow down has only been happening for the last 6-9 months so it may be reasonable to think that those who bought a home 6 months ago didn't do so to live it and would exactly fit the criteria of those the tax was designed to target. I would also fully support some form of capital gains tax adjustment that's more restrictive the quicker you flip. Investing is fine, speculation is not so fine. As an aside I would also suggest that the Bank of Canada needs to revisit it's 2015 Fall study on the Empirical study of CPI and House price inflation. Currently, the CPI which most govt. entities base a number of factors on, such as wage increases, does not include house prices, yet when a home goes up 30-40% in price in 12 months that has a major impact on the true cost of living. It needs to be revisited in a hurry. If you build in house price inflation or even the inflation on a downpayment you will have a very different picture of Canadian economics. I applaud the Vancouver govt. for doing something. It may have been a big stick approach and that isn't always the best, but they did something. Govt. has a knack of too little to late and Ontario is displaying a very fine attribute to proving this theory correct.
  • JOGINDER SEKHON | 17 Apr 2017, 03:23 PM Agree 0
    Exactly! Toronto needs it badly for the sake of average buyer. Everyone feels it but almost no one stands for it! Steep velocity and tempo of rising prices is frightening. Needs to be bridled!
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