Last week the Government of Ontario introduced 16 points that it is bringing forward in the next Provincial budget tailored, in their mind, to dampen the activity in the GTA Real Estate Market.
Their timing is perfect, not only because we will soon be heading into a Provincial Election but their announcement comes at the beginning of May, a time when a lot more properties come to the market. “Spring flowers bring for sale signs!” repeats yearly.
The increase in the number of listings will also help flatten the activity somewhat as it has been driven mostly by a scarcity of properties to sell. I assume that there will be a bit of a shock to the market as the NRST (Non-Resident Speculation Tax) seems to be not as drastic as the one imposed in BC. There are several exclusions however it is unclear now if those exclusions will be made by a rebate after the tax has been paid to the Government, by way of application after the fact. This could be a major factor for some buyers in terms of the amount they are willing to pay.
Also, if this move was targeted to the Mainland Chinese buyers, the recent introduction of more restrictions by the Chinese Government on funds leaving China will also play into the hands of the Ontario Government. They will happily take credit for slowing the market however, it does not solve the major problem. We need to really look at streamlined intensification of our cities providing much better services.
My thoughts for what they are worth.