· by Huzaifa Saeed
RAPID POLICY UPDATE: Brought to you in partnership with the Ontario Chamber of Commerce
Ontario’s Fair Housing Plan
Today, the Ontario government released a set of 16 comprehensive measures aimed at helping Ontarians find affordable homes and bring stability to the real estate market. The OCC applauds the government for taking action to ensure affordability, however, they believe that measures should target increasing supply and protecting landlords while encouraging new opportunities for growth.
Background on the Fair Housing Plan:
Ontario’s housing market has seen dynamic growth in recent years, with prices in the Greater Toronto Area and the Greater Golden Horseshoe rising significantly. After two consecutive years of double-digit gains, average house prices in the Toronto region reached $916,567 in March 2017, up 33.2 percent from the previous year. In the Hamilton CMA, median housing prices rose to $410,000 in early 2017, over $18,000 from the 2016 figure, even within the last few months the market has broken consecutive average price growth records.
Ontario’s Fair Housing Plan will introduce 16 measures targeted at addressing both the supply and demand side of the housing market.
What follows is a brief overview of some of the more substantial policy measures introduced as part of the plan.
Key Details of the Announcement:
Actions to Address Demand for Housing
- (Starting April 21st, 2017) Implementing a new 15 percent Non-Resident Speculation tax (NRST) on the price of homes purchased by non-citizens or permanent residents of Canada or by a foreign corporation. The tax affects the entire Greater Golden Horseshoe catchment area, which includes the City of Hamilton. The tax will have exemptions for skilled workers enrolled in provincial programs and refugees. Anyone obtaining a permanent residency or Canadian citizenship within four years of purchasing their home would receive a full rebate of the NRST. International students enrolled full-time for at least two years would receive a full rebate.
- Tax vacant homes to push owners to sell unoccupied units or rent them out
- Align property tax for new multi-residential apartment buildings with other residential properties
- Municipalities could be allowed flexibility to use property tax as a policy tool to influence development
- Identify surplus provincially owned land that could be used to build affordable housing
Actions to Protect Renters
- The most significant action is the expansion of rent control to all private rental units in Ontario to now include those built after the cutoff of 1991 as the construction year. This will tie the rent control in most rental apartment units to a maximum of the consumer price index (roughly 2.5% annually) with some exceptions. This measure is designed to create certainty for tenants.
- Introducing a targeted $125 million, five-year program to encourage the construction of new rental apartment buildings by rebating a portion of development charges;
- Providing flexibility to municipalities to use property tax tools to enhance development opportunities;
Creation of a new Housing Supply Team of dedicated provincial employees with a mandate to identify barriers to housing development projects.
- Working with municipalities to better reflect the needs of a growing Greater Golden Horseshoe through an updated Growth Plan;
Establish a Housing Advisory Group that will meet quarterly to provide ongoing advice about the state of the housing market and discuss the impact of measures announced in the Fair Housing Plan.
The Ontario government has also signaled their intention to review the Residential Tenancies Act (RTA). It is the view of the OCC that the RTA must protect landlords and property managers. We look forward to working with the OCC and Ontario government to modernize the RTA to help strengthen the sector and make Ontario a leader in real estate transactions and standards.
We are encouraged by the government’s intention to work closer with municipalities to address this complex challenge, especially towards expanding supply and encouraging new investment.
For the official plan please CLICK HERE
For more information, please contact: Huzaifa Saeed | Policy & Research Analyst | Hamilton Chamber of Commerce | t:905-522-1151 ext: 230 | e: email@example.com