"With this tax, we are targeting people who aren't looking for a place to raise a family - they're looking only for a quick profit or a safe place to park their money".
Notably, the issue of foreign buyers has been particularly controversial, with critics blaming them for speculation within the housing market but without hard data to support their contentions.
Home prices in the Toronto area climbed 6.2% in March, the biggest one-month gain on record, according to a benchmark price index released on April 18 by the Canadian Real Estate Association, and are up nearly 30% over the past 12 months.
The proposed legislation includes expanding rent control, incentives for those who build rental housing and new tools that will allow Toronto city council to follow Vancouver's lead in imposing a tax on vacant homes. A similar tax in Vancouver brought sky-high prices down initially, but they're creeping back up, suggesting the measure's effect may have been only temporary.
The province of Ontario, where the red-hot Toronto housing market is located, will unveil a suite of 10 different measures to control housing prices, according to a report from the Toronto Star. "Therefore, any moderation in prices linked to the tax in the Toronto area is likely to take longer to materialize than Vancouver, where the effect was nearly instantaneous".
"We're going to continue to pay close attention to what happens in the housing market", she said.
Real estate speculation and tax avoidance remain primary concerns in the region, and the new plan would address the issue, first by exploring paper flipping practices that could be contributing to these problems.
The Ontario government unveiled its plan to implement a 15% tax on foreign home buyers and impose rent controls in an announcement on April 20.
Ontario's Fair Housing Plan would also expand rent control to all private rental units, including those built after 1991, strengthening protections for tenants against sudden, dramatic rent increases.
"The non-resident speculation tax has nothing to do with new Canadians and people who want to make Ontario their home".
Toronto Mayor John Tory says there's a growing divide in the city between people who can afford to live and work here and those who can't, but he points out that there's no silver bullet to the problem. Ontario's government will also work with municipalities to identify provincially owned surplus land that could be used for affordable and rental housing development.
"This proposal seems to have come out of left field and there is no policy context or rationale advanced by the Province to justify this significant intrusion into what is, for the most part, a highly professionally run industry", he said.
"Recent market fluctuations and policy changes aimed at controlling participation and entry into these markets have caused consumer and media interest to reach a fever pitch", said Zoocasa CEO Lauren Haw.
- A five-year, $125-million program aimed at encouraging the construction of new rental apartment buildings by rebating a portion of development charges.
What else do you need to know about "Ontario's Fair Housing Plan?"
Premier Kathleen Wynne and Finance Minister Charles Sousa have signalled that the measures will take aim at speculators, expedite more supply, tackle rental affordability and look at realtor practices. This will include: developing a standard lease with explanatory information available in multiple languages; tightening provisions for "landlord's own use" evictions; and ensuring that tenants are adequately compensated if asked to vacate under this rule.
- More flexibility for municipalities when it comes to using property tax tools to encourage development.
The three politicians made the comments after a special meeting to discuss the housing situation. Others, however, believe the figure was much higher.