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Ontario will outline plans next week to deal with rising home prices

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Real Estate Professional | 09 Nov 2016, 09:39 AM Agree 0
Ontario will take steps next week to deal with rising house prices in the Toronto area, but it will not follow British Columbia's lead and impose a tax on foreign buyers
  • Peter B. Realtor | 09 Nov 2016, 10:13 AM Agree 1
    Do these people not understand "supply and demand" theory? Doing anything to make homes "more affordable (land transfer rebates, etc) in an ascending market will simply allow the sellers to fold the extra benefits into the asking price. Land transfer tax rebates are useful (paid for my fridge when I bought my first house) but in this case, it will not help. This market will level itself soon enough and could be eased by introducing more rentals into the market area.

    In Vancouver's case, the tax did NOT cause the slowdown, which had started before the introduction of the tax (as many Realtors suggested... cause we do understand the market better than many politicians) but did cause it to accelerate which in turn is causing some value loss to the late-time buyers. Do I pity the sincere buyers that fought their way into the market before the downturn? Yes as an increase in interest rates may crush them. That will not help anyone, not the home owners or the support services and industries (furniture makers, retail, services in the area).

  • Gill Mullis. | 09 Nov 2016, 10:29 AM Agree 0
    No they don't understand supply and demand. They're not out in the field like we are. Too few listings and buyers out number the homes available. Multiple offer presentations pushing people to take a chance after years of saving or risk never being able to afford a home. People cashing in, moving further out of the big city area raising those towns and cities prices they move to With larger incomes than most, as they keep their big city jobs. Woodstock and even as far as London are seeing growth that isn't entirely affordable to the existing residents as in comparison to Toronto the prices are dirt cheap as one buyer mentioned. commuters will travel upto 2 hours to Toronto for work each way.
  • MRH | 09 Nov 2016, 11:06 AM Agree 0
    Agreed. The issue is population growth. More and more people moving to an area means more demand for housing. Duh. Supply can't keep up with it because downtowns can't get bigger except for condos. Detached home supply can only increase from one thing - urban sprawl (oh I said a bad word). Infill is the worst answer. Turning 1960's bungalows into million dollar building lots reduces urban sprawl for only the wealthiest buyers.
  • Darin | 09 Nov 2016, 11:14 AM Agree 0
    There are no issues with buyers in Toronto, its simple economics. Supply and demand are the issues. There is simply not enough homes on the market to create a balanced market. Ever since the implementation of the Toronto Land Transfer Tax the amount of new listings has gone down every month. If you want to balance the market, give the sellers some rebates to list their homes. Nobody wants to pay thousands in land transfer tax, thousands on Toronto tax, real estate fees, legal fees to move, it's just too much equity. The new regulations on mortgage requirements are just hurting the people we want to get into a home (first-time buyers) and start paying property taxes, and provincial taxes
  • Allen H,. Mortgage Agent | 09 Nov 2016, 11:28 AM Agree 1
    Okay I need to get this off my chest finally. In my view there are only two levers that those in power could be adjusting to properly make housing more affordable.

    1) Increase Supply - incentives to building more high density housing.
    2) Increase Wages - wage growth has been too slow for too long. It's the other side of the "affordability" equation that keeps getting ignored.

    My $0.02 on this nonsense.
  • Alister | 09 Nov 2016, 11:51 AM Agree 0
    The route of the problem of lack of supply and the huge demand for real estate has been caused by Government interference! Starting with the imposition of the green belt, reducing the availability of land, which forced demand and land values up in the infill areas. Also over government regulation restricting development and rezoning of property has had its knock on effect and if land prices are pushed so high because of lack of supply and excessively high development costs and beaurocractic hurdles then entry level priced housing will never be possible!
    What government needs to do is to create incentives for developers to want to build entry level priced homes but, that can only be achieved if development land is affordable and available by increasing its area and supply.
    So Government please - reduce the beauracy and the development costs that have forced the lack of area supply to be totally outstripped by demand!
  • Russell Smith | 09 Nov 2016, 02:36 PM Agree 0
    The Federal Government just made it more difficult for first time buyers to purchase a home with their mortgage changes in an attempt to slow down the market and now the Provincial Government is trying to make it easier for first time buyers to buy a home! Go figure. Does anyone in government know what they are doing?
  • Greg | 09 Nov 2016, 07:14 PM Agree 0
    The Problem,

    1) Interest rates too low, creating too much money in the system for housing. Too much money chasing too little supply.
    Tighten the money supply. Make interest rates for mortgages at 8%.
    2) The Canadian Dollar is low. This means foreigners buying our land and housing cheaper than Canadians can. Canadian housing is cheap as our dollar is low. But expensive for locals.
    3) Too many investor buyers chasing yield as risk vs reward beats the stock market, bonds and GIC's .... all money is in housing. This needs to be changed.

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