Something needs to be done to rein in Toronto’s boiling market, according to one of the politicians who can actually do something about it.
Ontario Finance Minister has his sights set on Canada’s hottest housing market.
Most recently, he suggested addressing the issue requires more than policy at the provincial level.
“There are individuals that are going into subdivisions that are buying 10, 40, 50 homes – holding paper – and flipping it … and they’re crowding out families who are trying to buy,” he told the Toronto Star. “We can’t do that without the [Canada Revenue Agency].”
The trend of foreigners snatching up entire developments is one noticed on the ground by real estate professionals.
“This week alone, one of the agents in my brokerage who was meant to be listing a 50 unit condo building was just informed today the developer sold the entire building to a Chinese consortium and that we’re not getting any of the listings,” Carl Langschmidt, president of Condos.ca, REP sister publication Canadian Real Estate Wealth earlier this week. “That’s how hot the market is.”
For his part, Sousa has called on the Federal government to implement a speculator tax. That suggestion was ignored in the latest Canadian budget.
Still, Sousa has some options at his disposal, including a foreign buyer tax; a similar one was implemented at the provincial level for Vancouver.
That’s a policy initiative Langschmidt supports.
“At the end of the day developers create condos that have value. A portion of that value is created from the infrastructure; the parks, hospitals, hotels, you name it,” he said. “That is actual infrastructure that is created by the taxpayer. If a Canadian buys it, it’s one thing. If a foreign investor buys it, they haven’t paid for any of that. So in economics it’s an externality that needs to be factored into the equation.
“A lot of Canadian homebuyers are frustrated that they can’t get into the market and are being beat out by foreign buyers who are coming in.”
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