Late last week, Premier Kathleen Wynne announced a series of changes that are aimed at cooling the hot housing market in the GTA. With fears that the market has entered bubble territory, the government felt that intervention was necessary to take aim at foreign ownership and speculative buying in an attempt to make housing more affordable for the average Ontarian. The 16 changes the Provincial Government announced include:
1.) 15% Foreign Tax on homes purchased by individuals who are not citizens or permanent residents of Canada.
2.) Expanding rent control to all private units in Ontario, including those built after 1991.
3.) Increased protectionism for tenants.
4.) The proposal of a vacant home property tax to encourage property owners to sell unoccupied units.
5.) A $125 million, five year program to encourage the construction of new rental units to increase supply.
6.) Ensuring that real estate agents are fairly representing consumers when conducting transactions.
7.) Creating a Housing Supply Team dedicated to identifying specific barriers to housing development projects in the GTA in an attempt to increasing the supply of housing.
These are some of the major developments that have been proposed for the upcoming Provincial Budget. One thing that has been left out for now is any legislation targeting house “scalpers”. Essentially, these investors tend to purchase pre-construction contracts and flip them for a hefty profit. Legislation for banning this practice should be proposed shortly.