BUSINESS

Toronto Foreign Buyer Tax Wouldn't Fix High Prices: Real Estate Board

03/10/2017 01:51 EST | Updated 03/10/2017 01:51 EST

TORONTO — The Toronto Real Estate Board is urging the Ontario government not to implement a tax on foreign buyers, arguing that it would do little to address the problem of rising house prices in Canada's largest city.

Finance Minister Charles Sousa said Thursday that he's considering implementing such a tax as a possible option to cool Toronto's red-hot housing market.

Last year, Sousa said Ontario would not be following the lead of British Columbia, which implemented a 15 per cent tax on foreign nationals buying homes in the Vancouver area.

But house prices have continued to soar, with February data from TREB showing that the price of a detached, single-family home rose 29.8 per cent from a year ago.

toronto houses The real estate board also argues that concerns about the impact of foreign buyers on the real estate market in the Greater Toronto Area are "widely overblown.'' (Photo: Getty Images)

TREB says that a foreign buyer tax would not address the supply shortage that has been driving home prices higher.

The real estate board also argues that concerns about the impact of foreign buyers on the real estate market in the Greater Toronto Area are "widely overblown.''

"The fact that most foreign buyers are looking to purchase a home for their family, for personal use, or to provide a tight rental market with much needed supply is something to be encouraged, as these actions are essential to Ontario's economic success,'' TREB president Larry Cerqua said Friday in a statement.

"Imposing a tax on foreign buyers will not have the desired effect of cooling the housing market and could create adverse effects on the national, provincial and GTA economies.''

Also on HuffPost

Foreign Ownership Of Real Estate Around The World