Toronto real estate could be in for a change in 2022, if a proposed vacant home tax gets the green light. The City of Toronto has proposed a vacant home tax in an effort to boost the city’s low housing supply and fund more affordable housing in the city. But RE/MAX Executive Christopher Alexander is casting doubts on the purpose of the tax and the possible repercussions.

The City’s report says the tax could raise up to $66 million in annual revenue, a figure that’s modelled on Vancouver’s vacant home tax that took effect in 2017, and based on a 1% vacancy rate of Toronto’s housing stock, and a tax rate of 1% on the average Toronto home’s current assessed value.

To give you an idea of average selling prices in the Toronto real estate market, the average price across all property types was $979,224 in November, according to the Toronto Regional Real Estate Board (TRREB). Single-detached homes were selling at an average price of $1,477,226, while condominium apartments were going for an average price of $640,208.

The proposed tax will be going before City Council on December 16 & 17, with the recommendation that it be levied starting in 2022. According to a news release issued by the City of Toronto late last week, “A vacant home tax increases the housing supply by encouraging homeowners to sell or rent their unoccupied home, and if they choose to continue to keep the home vacant, a tax is levied. This revenue can then be used to fund affordable housing projects.”

However, Christopher Alexander, Regional Director and Executive Vice President, RE/MAX of Ontario-Atlantic Canada, is doubtful.

Continue to read on: REMAX.ca