This piece by Lawrence Solomon is very effective at pointing out the contrast between property taxes applied to landlords versus those that are paid by private homeowners.
In Toronto, property taxes for homeowners are disproportionately low, not just compared to local rental costs, but also for property taxes applied across the province and rest of the country.
As a result, there’s no logic to renting a property. When inhabitants of other world-class cities (New York, Chicago, London, etc) have no hope in hell of owning something, why should the people of Toronto (note how I’m equating Toronto with these other top-tier cities)?
Solomon hints that landlords should pay less, but obviously I lean towards the opposite: property taxes levied on homeowners need to increase.
The frenzy that’s happening with Toronto real estate will not be solved by Ontario’s ‘Hail Mary’ plea to the federal government to alter capital gains taxes. Don’t get me started on the absurdity of this request. It’s a massive fail on Wynne’s part.
This is asking the Rest of Canada to pay for Toronto’s insanity.
So, NO. We won’t accept that.
Instead, here are just a few suggestions about how Toronto can moderate the frothiness of their real estate market without pissing off the Rest of Canada:
- Institute a gradual increase in homeowner property taxes over the next 5 years so that Toronto leaders can fund their city based on payments from Torontonians.
- Put an end to real estate speculation by enforcing transparency with bidding IMMEDIATELY. The level of disturbing manipulation that’s taking place must come to an end.
- Implement a foreign ownership tax similar to Vancouver.
- Cap the borrowing rates, especially for new owners. If all you can afford is a 600-square-foot apartment, that’s all you can afford.
The message for Toronto is that you have to take care of yourself if you want Canada to come to the table. And you have to accept that you’re a world-class city, so ownership simply may not be an option.
And if that’s unacceptable?
There are hundreds of cities, towns and villages where you can live affordably in Canada and that would be happy to receive you if you gave them a chance.
Creating rules and regs that affect 100% of us for the benefit of a select few is a recipe for disaster.