Toronto Income Property Newsletter: June 2016

Last month I touched upon the foreign ownership craze that has taken our city by storm. No sooner had I finished my piece that I notice that Macleans magazine that week was running a feature story on the exact same story. SOLD – it boasted in Chinese characters on the cover. It examined how Asians were buying a lot of Canadian real estate, particularly in Toronto. The average price for property viewed by Chinese property hunters in Toronto has increased over the past two years as the average price in Vancouver has declined, according to Juwai.com, a Shanghai based real estate Internet portal. The two cities have switched roles, with Toronto now attracting a higher-priced buyer mix than Vancouver. Canada is now the third most popular country for Chinese buyers after the United States and Australia, Juwai.com says. With gaining popularity, Canada has now surpassed Britain, which has slipped to fourth place.

My position is basically that if the federal government or the City of Toronto doesn’t place barriers for foreigners to buy up everything, then we shouldn’t be surprised or upset that this phenomenon is occurring. Foreign buyers do not have a competitive advantage. They either just have more money or a willingness to pay a little more than others in order to not lose in competitive offer situations. Remember that Sellers want their agents to get them as much money as possible, so should we really begrudge it when that happens – no matter who the buyer is?

There is a rebate available on the municipal land transfer tax if you are a first-time purchaser of a newly constructed or re-sale residential property, it the following criteria is met.

The definition of a first-time purchaser is:

• The purchaser is at least 18 years of age.
• The purchaser must occupy the home as his/her principal residence no later than nine months after the date of the conveyance or disposition.
• The purchaser cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time.
• The purchaser cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time.
• If the purchaser has a spouse, the spouse cannot have owned a home, nor had any ownership interest in a home, anywhere in the world while he/she was the purchaser's spouse. If this is not the case, no rebate is available to either spouse.

The rebate for first-time home purchasers is up to a maximum of $3,725.00. If you are eligible for a rebate of all or a portion of the MLTT you owe, your lawyer will be able to claim the rebate electronically through Teraview software when he/she registers your transfer/deed.