This morning the Government of Ontario announced a slew of measures, referred to as the Fair Housing Plan, intended to address some of the challenges facing the rapidly overheating housing market. The comprehensive set of actions is meant to take a multifaceted approach by helping cool demand, address shortages of supply, and promote affordability in the provincial housing market. Sixteen initiatives can be categorized into three broad buckets:
Demanding Cooling:
A 15% non-resident speculation tax (NRST) in the Greater Golden Horseshoe on residences between one and six units. The NRST would be levied on non-citizens, non-permanent residents of Canada, and foreign corporations, but would exclude refugees, and nominees under the Ontario Immigrant Nominee Program. There were a number of exclusions, in which tax rebates would be available to those who subsequently receive citizenship or resident status. In addition, exclusions were also made available for international students and foreign nationals who can demonstrate residency for a period of time from point-of-purchase of a home.
Prevention of ‘paper flipping,’ or reselling properties pre-construction
Supply boosting:
Allow municipalities to levy a property tax on vacant homes
Provide flexibility for municipalities to impose higher taxes on vacant land
Lower property-taxes for new purpose-built apartment buildings
Leverage provincial assets to help build housing stock
Introduce a $125 million program over five years to encourage purpose-built apartments
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