Increase to Toronto’s vacant home tax, this was first introduced in 2022, ‘vacant home tax’ implemented to increase the supply of housing by discouraging empty homes, that came into effect January 1, 2023, this year in 2024 the vacant home tax tripled from from 1.0% to 3.0%.
This is calculated on the Current Value Assessment and based on occupancy of the previous tax year, meaning that homes deemed vacant in 2023 will pay 1.0% in 2024, and 3.0% will be applied to vacant properties in 2024 and payable in 2025.
Deadline to record your property is February 29, 2024, if you fail to file, your property will be deemed occupancy vacant and the tax will be levied onto your tax bill for the following year. Every property owner in the City of Toronto must report, here is the link to file.
https://www.toronto.ca/services-payments/property-taxes-utilities/vacant-home-tax/
New Luxury land transfer tax, for properties at $3+M, these are graduated Municipal land transfer rates.
Property Value Toronto Land Transfer Rate
Over $3,000,000 – up to $4,000,000 3.5%
Over $4,000,000 – up to $5,000,000 4.5%
Over $5,000,000 – up to $10,000,000 5.5%
Over $10,000,000 – up to $20,000,000 6.5%
Over $20,000,000 7.5%
As a reminder, Toronto’s land transfer tax is tiered, if you’re buying a $4.250M, it is:
0.5% of the first $55,000
1% of the value between $55,000-$250,000
1.5% of the value between $250,000 to $400,000
2% of the value between $400,000-$2,000,000
2.5% of the value between $2,000,000-$3,000,000
3.5% of the value between $3,000,0000-$4,000,000
4.5% of the value between $4,000,000-$4,500,000
In addition, the Provincial land transfer tax portion remains the same.
Trust in Real Estate Services Act (TRESA) enacted to provide better consumer protection with a RECO Information Guide that must be shared with Sellers and Buyers.
With defined roles for:
Seller or Buyer you can now be:
Represented by a Realtor as a Client, or
Represent yourself as a Self-Represented Party (SRP)
Brokerage Representation can now be, where an agent or brokerage represents more than one party with competing interests in a transaction (multiple representation):
Brokerage Representation, the brokerage and all its agents represent you, or
Designated Representation, one or more brokerage agents is your designated representative.
Transparent disclosure requirements – Sellers and their representatives should disclose all they know about the property.
Open bidding wars while blind bidding multiple offer(s) scenario are still allowed, new rules have been put into place to guide all parties (Sellers, Buyers, Agents) to share some details of the other offers during a multiple competitive situation.
Exclusive Listing means a seller enters into a listing agreement with a brokerage, but the listing does not appear on the Multiple Listing Service (MLS) this specific exclusive listing is with that agent (and everyone only in their brokerage) has the exclusive right to find the Buyer.
Coming soon (or pocket listings) must be listed on MLS effective January 1st, 2024 within 3 days of public marketing that means you won’t see those coming soons advertised for months on end, as it’s a discouraging tactic for buyers who were shut out of seeing these secret properties and it hurt the sellers who don’t maximize their exposure to a wider buyer audience.
Financing rules and regulation changes, as more homeowners are renewing mortgages at higher interest rates we may (I hope) see changes to the stress test &/or amortization periods.
Bank of Canada Interest rate announcement schedule
Wednesday, January 24, 2024
Wednesday, March 6, 2024
Wednesday, April 10, 2024
Wednesday, June 5, 2024
Wednesday, July 24, 2024
Wednesday, September 4, 2024
Wednesday, October 23, 2024
Wednesday, December 11, 2024
Overview of 2023 & Outlook to 2024
Overall housing demand remained afloat due to record immigration in 2023, more of this demand was geared in the rental sector. The number of Greater Toronto Area (GTA) home sales in 2023 came in at less than 70,000 due to affordability issues brought on by high mortgage rates. Average selling price for all home types in 2023 was $1,126,604 that’s a 5.4% decrease vs 2022, but have we reached the bottom?
Here are some quotes from our colleagues at the Toronto Real Estate Board:
“High borrowing costs coupled with unrealistic federal mortgage qualification standards resulted in an unaffordable home ownership market for many households in 2023. With that said, relief seems to be on the horizon. Borrowing costs are expected to trend lower in 2024. Lower mortgage rates coupled with a relatively resilient economy should see a rebound in home sales this year,” said new Toronto Regional Real Estate Board (TRREB) President Jennifer Pearce.
“Buyers who were active in the market benefitted from more choice throughout 2023. This allowed many of these buyers to negotiate lower selling prices, alleviating some of the impact of higher borrowing costs. Assuming borrowing costs trend lower this year, look for tighter market conditions to prompt renewed price growth in the months ahead,” said TRREB Chief Market Analyst Jason Mercer.
“Record immigration into the GTA in the coming years will require a corresponding increase in the number of homes available to rent or purchase. People need to have comfort in knowing that they can plan their lives and future with the certainty that they will have the stability of an affordable place to live,” said TRREB CEO John DiMichele.
New lunar year welcomes the Year of the Wood Dragon on February 10, 2024 and will bring innovation, growth, partnerships, personal growth, and career advancements.
Please reach out to me anytime with real estate questions, discussion and/or to meet for a coffee/tea, I’m in the neighbourhood.