After the Ontario government unveiled 16 new housing intervention measures on Thursday, experts weighed in on some of the possible long and short-term effects on the Greater Toronto Area’s housing market. Here’s what they had to say:
“We’ll need time to assess the impact of today’s announcement, but based on our initial assessment, the overall revenue implications for the province could be relatively modest, as the extra foreign speculation tax revenue could be offset by reduced regular (i.e., existing) land-transfer tax revenue and/or the development charge rebate to spur new rental units. Other provinces will be watching closely to see if Ontario's new regulations drive foreign capital into their residential property markets, with Montréal having already sparked overseas interest.” – Warren Lovely, public sector researcher, and Stéfane Marion, chief economist and strategist, National Bank
“The combination of the foreign buyers’ tax, vacant units/land tax and measures to speed up approval processes should work to moderate house price inflation in the coming years. However, we view the move on rent control as one likely to have an impact in the wrong direction.” – Benjamin Tal, deputy chief economist, CIBC Economics
“While certainly commendable, it remains to be seen if these measures will bring price growth back down to more fundamental levels.” – Robert Kavcic, vice president and senior economist, BMO Economics
“I think that we’ll see turbulence. And turbulence means I’m sure we’ll get data out of April, and May and June…. that shows some markets across the GTA going down and some going up….Too many people are chasing too few units. And what we didn’t see was anything substantive on how were are going to provide more housing – single-family housing – that people are primarily demanding and higher-density housing as well…
When we sit down in about a year’s time to look over this period, we’re not going to see that anything that has really changed fundamentally. We are probably going to be looking at double-digit price increases from where we are now.” – Peter Norman, vice president and chief economist, Altus Group
"I've said it before and will say it again: foreign home buyers tax are just a game of whack a mole" – Frances Donald, senior economist, Manulife Asset Management.