TORONTO — Two Ontario real estate associations have voiced opposition against following in Vancouver's footsteps and implementing a tax on foreign homebuyers, saying that such a "knee-jerk reaction'' could have negative implications for the economy.
In letters penned to the provincial and municipal governments last month, the Toronto Real Estate Board and the Ontario Real Estate Association argue that instituting a tax on foreign homebuyers would do little to address affordability issues in Toronto's housing market.
Instead, it could cause house prices to soar in regions surrounding Toronto, thus pushing prices in Toronto even higher, the groups argue.
The Toronto Real Estate Board and the Ontario Real Estate Association argue that instituting a tax on foreign homebuyers would do little to address affordability issues. (Photo: CP)
In Metro Vancouver, home sales dropped 26 per cent following the Aug. 2 introduction of the 15-per-cent tax on foreign buyers.
The Real Estate Board of Greater Vancouver said there were 2,489 homes sold in Metro Vancouver in August, down from 3,362 a year ago.
Some critics have voiced concerns that the Vancouver tax could cause investment to shift to Toronto, further stoking the flames of the city's already red-hot housing market.