The Ontario government released some interesting news in The Globe and Mail. It was announced that the government will be providing first time home buyers a refund up-to $4,000 on the land transfer tax. This is said to be a small step to ease the pain of the Toronto housing market.
British Columbia went with a more direct approach in attempts to cool off their hot market by issuing a 15% tax for foreign buyers.
This refund that will be given to the first-time home buyers needs to come from somewhere and that somewhere is from other buyers. The government will be raising the land transfer tax for any portion of a home priced over $2 million by 0.5%*; also non-home properties, such as commercial buildings priced over $400,000 will rise by 0.5%
Example: *Home valued at $2.5 million ($500,000 x 0.05% = $2,500)
SO WHAT DOES THIS REALLY MEAN?
For the majority of individuals who are thinking of buying homes in York Region (Markham, Stouffville, Unionville, Richmond Hill and surrounding areas) this will have little effect.
What the Ontario government has done is inconsequential because they have given first-time home buyers an extra $2000, when really if a buyer is already willing to spend close to $800,000 on a home that extra $2000 will not effect the overall decision being made by the buyer.