The Ontario government released a 16 point plan to cool the housing market in the Golden Horseshoe. The plan aims to address demand for housing and increase the housing supply. It also aims to add controlling measures to the rental market.
Taking a cue from Vancouver, Ontario is implementing the Non-Resident Speculation Tax. Foreign Individuals (non citizens and non-permanent residents) will be taxed 15% on single family residences. The NRST will not be applicable to the purchase of mult-res, apartments buildings, agricultural land, or commercial/industrial land. Economist like Robert Kavcic from BMO believe the impact from the Tax will be less than that felt in Vancouver although he predicts a modest negative impact on price growth.
Economist do have some concerns that the controls placed on the rental market will likely have an impact in the wrong direction. They believe the controls do not provide incentive to bring supply to the rental market.
The Ontario government will also be partnering with the CRA to develop more comprehensive reporting requirements, establishing advisory group to provide quarterly reporting on the state of the housing market. They will also be reviewing REBBA 2002 (our governing act as Realtors) to ensure the highest level of professionalism is in place.
Although, the plan focuses primarily on the GTA, it's evident through this market that we are directly impacted by their housing market. Economist predict the measures may slow down the housing market due to the uncertainty of their impact on potential buyers and not necessarily due to their direct impact. Click the photo below for the full 16 point plan. We will keep you updated as we receive information.
CMHC will be raising their mortgage premiums. On average most will see an increase of $5 monthly while those with mortgages above $450,000 will see an average increase of approximately $8.47/month. This affects government insured mortgages - so those with less than a 20% downpayment.
More information at the Global Article link below