We polled brokers and agents for opinion on potential cooling measures and sentiment was decidedly split.
In what is likely the most comprehensive survey of agent opinion on the matter, the results are in on whether or not the industry is in favour of a foreign sales tax in Toronto.
A total of 3,343 REP readers took part in our latest poll, in which we asked whether a Toronto foreign sales tax was a good idea.
Opinion was decidedly split.
Of those based in Toronto, 49% said it would a good idea compared to 51% disagreed.
Outside of Toronto, meanwhile, agents had a relatively similar split: 51% were in favour of a Toronto foreign buyer tax compared to 49% against.
A similar question was asked of MortgageBrokerNews.ca readers.
The results were slightly different.
Of those polled, 65% were in favour of market intervention; 23% believe the market should be left to its own devices; and 12% were undecided.
A lot has changed since last summer’s bombshell announcement that Vancouver would start taxing foreign homebuyers an additional 15%. Vancouver’s real estate prices took a dive while Toronto’s skyrocketed.
And while there is no concrete proof that foreign money that would have been spent in Vancouver is making its way further east, anecdotal evidence certainly supports that hypothesis.
Now, it seems, the debate has been reignited in Toronto.
“A year ago I was thinking, ‘Let market forces prevail,’” Finance Minister Charles Sousa recently said when asked about the potential tax. “But now I’m concerned about … the ability of people to enter the marketplace. [There are] bidding wars everywhere you go, it appears, and I’m sensitive to that.”
For its part, however, the housing industry in Ontario is against the tax.
"Home affordability needs to be addressed before millennials are completely priced out of the market,” said Ontario Real Estate Association CEO Tim Hudak. “That is why Ontario Realtors have called for the creation of an Affordable Homeownership Task Force. We need real estate experts to come together to hammer out a plan for making homeownership more attainable for first-time buyers and young families.
“The main culprit behind rapidly rising house prices is the GTA’s unbalanced market – housing supply cannot meet demand – not foreign buyers,” Hudak continued. “A foreign buyer tax would only penalize the international MBA student who will one day start her own business in our province, or the surgeon aspiring to work at Sick Kids. Before we pin a tax on foreigners, we need to address the elephant in the room, and that’s the lack of housing supply.”