Saudi Arabia Is Making a High-Risk $1 Trillion Bet on Tourism
The kingdom must overcome a conservative image and concern about human rights. Visit the desert oasis town of AlUla to understand the challenge.
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The kingdom must overcome a conservative image and concern about human rights. Visit the desert oasis town of AlUla to understand the challenge.
Jury selection was completed Friday for Donald Trump’s first criminal trial, setting the stage for opening arguments Monday in a New York case accusing the former president of falsifying business records to conceal a sex scandal before the 2016 election.
Higher-than-expected interest rates amid persistent inflation are perceived as the biggest threat to financial stability among market participants and observers, according to the Federal Reserve.
Fifth Third Bancorp jumped the most in four months, leading bank stocks higher, with Chief Executive Officer Tim Spence predicting that income from lending has bottomed out.
China’s securities regulator said it will encourage the nation’s companies to list in Hong Kong as it unveiled a package of measures to bolster the city’s position as an international financial hub.
Mar 10, 2017
By Greg Bonnell
Ontario Finance Minister Charles Sousa says a foreign buyer tax is “just one” of the measures being considered to cool off the Toronto area’s red-hot housing market.
“Just one” suggests there are other moves being discussed ahead of the spring budget. BNN asked several economists and market watchers about what other levers the government could pull.
NEW TAXES
Never popular with the voting public, but definitely an area where the province can exert influence. David Madani of Capital Economics says a foreign buyer tax doesn’t make much sense, given foreigners only account for a fraction of home sales in the Greater Toronto Area. A new provincial sales tax on home resales, and/or raising the existing provincial sales tax on housing-related transactions would put the focus on the domestic buyer and work to cool the market.
TARGET THE SPECULATORS
Again, likely through a tax measure but one that hones in on a specific group of buyers looking to make a quick buck on real estate, and not the young people or families seeking a place to hang their hats. CIBC Capital Markets Senior Economist Benjamin Tal has advocated (for some time now) a flipping tax on foreign investment – saying while the true extent of all foreign investment is not known, foreign speculators are not constructive for the housing market.
TAKE AIM AT EMPTY BEDROOMS
Paul Smetanin, president of the Canadian Centre for Economic Analysis, says taxes and regulations would likely only provide temporary relief for Ontario’s housing woes. The Toronto area, he says, has a significant “over-housing” problem that’s crowding others out. Think of two people, maybe a boomer couple, still living in the four-bedroom house they raised their kids in. Smetanin says encouraging “right-sizing” would provide much needed housing resale supply, adding it’s something the government “needs to consider seriously.”
As Ontario sifts through its options, Sousa does concede that he’s concerned about any unintended consequences from actions the government could take to tame the housing market.