November 7, 2023 | Podcast
39. What to Know About Toronto’s Vacancy Tax Hike
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The vacant home tax, in place for a year now, primarily focuses on properties not used as a principal residence by the owner. The increase in the tax rate is expected to generate additional revenue for the city, with projections of $105 million in 2025, $95 million in 2026, and $87 million in the following year.
The exemptions to the tax include properties used as a principal residence by the owner, permitted occupants like spouses or family members, and properties rented out for at least six months. Newly built housing also gets a two-year exemption.
The podcast discusses the potential impact on the real estate market, predicting a backlog of inventory coming into the market, the influence of the GST tax incentive for rental buildings, and the overall aim to increase housing supply. However, concerns are raised about the disconnect between federal immigration policies, which are increasing immigration volume, and the lack of plans to accommodate the influx.
The hosts highlight the need for a more comprehensive, long-term solution to the housing issue, emphasizing that the vacant home tax is a band-aid solution addressing the deficit rather than the root cause.
They also touch on issues related to short-term rentals, such as Airbnb, and mention exceptions for renovations.
In the end, the hosts express hope for positive changes, citing a client’s experience with obtaining approval to build low-rise units on purchased land in Durham Region as a promising sign of maximizing land use for increased housing.
And that’s the news from the Toronto real estate front!
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