Generic filters
Filter by Categories
All Condos
Ask Andrew
Hi-Rise (West) Inc.
New Condos by City
Halton Hills
Port Credit
Square One
Niagara Falls
Richmond Hill
The Blue Mountains
Baldwin Village
Bayview Village
Bedford Park
Briar Hill
Brockton Village
Canary District
Casa Loma
Church & Carlton
Church & Wellesley
Church St. Corridor
Clanton Park
Corso Italia
Danforth Village
Davisville Village
Distillery District
Don Mills
East Junction
East York
Eglinton East
Eglinton West
Entertainment District
Fashion District
Financial District
Flemingdon Park
Forest Hill
Garden District
High Park
Kensington Market
King East
King West
Liberty Village
Little Italy
Little Portugal
Long Branch
Moss Park
North York
Old Town
Regent Park
River District
St. Clair West
St. James Town
St. Lawrence
Tam O'Shanter-Sullivan
The Annex
The Junction
The Kingsway
The Queensway
Victoria Park Village
Wallace Emerson
Yonge & Bloor
Yonge and College
Yonge and Dundas
Yonge and Eglinton
Yonge and Lawrence
Yonge and Richmond
Yonge and Sheppard
Yonge and St. Clair
New Condos by Deposit
10% Before Occupancy
15% Before Occupany
5% Before Occupancy
New Condos by Developer
Acorn Developments
Adi Development Group
Allegra Homes
Alterra Developments
Altree Developments
Amexon Development
Andrin Homes
Angil Development
Aoyuan International
Aragon Properties Ltd
Armour Heights Developments
Artlife Developments
Ashcroft Homes
Aspen Ridge Homes
Balder Corporation
Ballymore Homes
Bazis Inc
Benvenuto Group
Biddington Homes
Blackdoor Development Company
Block Developments
Bloomfield Homes
Branthaven Homes
Briarwood Development Group
Brixen Developments
Brookfield Residential
Canderel Residential
Capital Developments
Carlyle Communities
Carriage Gate Homes
Carttera Private Equities
Castlebridge Development Group
Castleview Developments
Centrestone Urban Developments Inc
Centreville Homes
Chestnut Hill Developments
Choice Properties REIT
Choo Communities
Cityscape Development Corporation
Clifton Blake
Concert Properties
Concord Adex
Condoman Developments Inc
Conservatory Group
Constantine Enterprises Inc.
Consulate Development Group
Core Development Group
Cortel Group
Craft Development
Creek Village Inc.
Cresford Developments
Crown Communities
Crystal Homes
Cystal Glen Homes
DC&F Corp
Diamante Development
Diamond Kilmer Developments
Distrikt Developments
Doornekamp Construction Ltd
Dormer Homes
Downing Street Group
Dundee Kilmer
Eden Oak
ELAD Canada
EllisDon Capital
Emblem Developments
Empire Communities
Evans Planning Inc
Fernbrook Homes
Fieldgate Urban
Fifth Avenue Homes
First Avenue Properties
First Capital
Flato Developments
Forest Hill Homes
FRAM + Slokker
G Group Developments
Gary Silverberg
Gemterra Developments Corporation
Genesis Homes
Georgian International
Globizen Developments
Gordon Wells Ltd.
Great Gulf
Greatwise Developments
Greenfield Quality Builders
Greenland Group
Greenpark Group
Greybrook Realty
H&W Developments
Harhay Developments
Harlo Capital
Haven Developments
Homes by DeSantis
Hyde Park Homes
Icon Homes
IN8 Developments
Investissement SM Immobilier
JCF Capital
Kaleido Corporation
Kalovida Canada Inc
Kaneff Corporation
KBIJ Corporation
Kingdom Development
KingSett Capital
Kroonenberg Group
Lalu Canada
Lamb Developments
Lancaster Homes
Latch Developments
Laurier Homes
LCH Developments
Les Entreprises QMD
Liberty Development
Liberty Hamlet Inc
Lifestyle Custom Homes
Lifetime Developments
LJM Developments
Madison Group
Malibu Investments
Manorgate Homes
Marlin Spring Developments
Marydel Homes
Mattamy Homes
Medallion Capital Group
Mizrahi Developments
MOD Developments
Nascent Developments
New Horizon Development Group
NOCO Development Company
Norstar Group of Companies
North American Development Group
North Drive
North Edge Properties
Northam Realty Advisors
Nova Ridge Development Partners
Old Stonehenge
ONE Properties
One Urban
Options Development
Oxford Properties
Parallax Development Corporation
Patry Inc Developments
Pemberton Group
Phelps Homes
Pinnacle International
Platinum Vista
Podium Developments
Primont Homes
Queensgate Homes
RAJACan Developments Inc.
ReBuilt Construction
Reids Heritage Homes
Rise Developments
Riverking Developments
Rosehaven Homes
Rosewater Developments
Rowntree Enterprises
Royalpark Homes
Royalton Homes
Saxon Developments
Scholar Properties Ltd
Sequoia Grove Homes
Seven Numbers Development
Sherwood Homes
Shiplake Properties Limited
Sierra Building Group
SilverCreek Communities
Solmar Development Group
Solotex Corporation
St. Regis Homes
St. Thomas Developments
State Building Group
Sundance Homes
Sunny Communities
Tercot Communities
The Remington Group
The Rockport Group
The Rose Corporation
The Sher Corporation
Tiffany Park Homes
Time Group Corp.
Treasure Hill
Tribute Communities
Tricon Developments
Triumphant Group
Trolleybus Urban Development Inc
Trulife Developments
United Lands
Urbane Communities
VanMar Developments
Vermilion Developments
Vintage Park Homes
Wabash Heights Developments Inc
Westbank Corp
Westbank Corp. and Allied Properties
Zancor Homes
New Condos by Occupancy Year
True Condos Approved
Filter by content type
Taxonomy terms

Could the 15% Foreign Tax Be Coming to Toronto

B.C. has introduced a 15% tax on real estate purchases for foreign buyers. Could this tax be coming to Toronto? What impact if any will this have on the market? What should the government really be doing to help make housing more affordable?

Click Here for Episode Transcript

Andrew la Fleur: The government in BC just introduced a new 15% transfer tax for all nonresident buyers in the Vancouver area. What are the implications of this new tax? Why did they do it? Could this tax come to Toronto? All in today’s episode.


Speaker 2: Welcome to the True Condos Podcast with Andrew la Fleur, the place to get the truth on the Toronto condo market and condo investing in Toronto.


Andrew la Fleur: Welcome back to the show. As I said in the intro, we want to talk about the 15% foreign buyer tax that was just introduced in BC. Once again, it is a land transfer tax of 15% of the total purchase price, and that is for anyone who is a nonresident of Canada and who is buying real estate in the Vancouver area. This is not for all of British Columbia. This is just for the Vancouver region, so it doesn’t apply even to Victoria, across the water or other cities in BC. Definitely a bombshell, definitely shocking and surprising a lot of people. Obviously, after the shock wore off, the next question is could this come to Toronto? I want to talk about that and other things here on today’s episode. I have a few thoughts on this. I just want to go through some of these thoughts that I have on this. A lot of people are asking me what I think so I thought, well, I’ll do a podcast and let you know what I think.


The first thing is that, to me, this is 90% political and 10% about the market itself. This, to me, is just really a decision, a legislation driven by political agenda. I really don’t think that this is about the market, about making it easier for regular people, whatever that means, to buy real estate in Vancouver. Let’s face it. It is a tax grab. This is a tax grab and it’s an easy way to grab some money and do a populist sort of thing that makes the government look good and everybody says, “Well, that’s great. You’re just grabbing money and taxes from a nonvoting population that is … It doesn’t affect anybody who votes. Hey, let’s go for it. $2 million, $300,000 extra tax on that. Sure. Why not? We can do it so we will.”


There’s zero data, really, close to zero data that is driving this decision. To me, it’s just a very emotional, knee-jerk, we don’t know what else to do so let’s try this kind of a reaction to a rising market. It’s funny. BC has always had markets like this. It’s always risen and fallen dramatically. It’s been a boom or a bust market for decades. Why they’re resorting to such tactics now? Again, they’ve always had foreign buyers in BC. It’s always been a big driver of the market there or at least a perceived driver of the market. Again, we have no data on this. We’re just guessing. We’re estimating that foreign buyers might be between 5, 6% of the market, maybe more, maybe less. It’s scary when you see … I don’t know if it’s scary but it’s concerning when you see politicians making decisions like this that affect a great number of people without having data to really back it up and having an understanding of what the repercussions of these are, and how it’s going to affect the market. That’s my first point.


The second point is it’s coming here. That’s right. I’m calling it. It’s coming to Toronto. It’s probably going to come across many cities, if not across the country, at least temporarily. Again, it’s a political thing. It’s a populist move. It’s in Vancouver. I don’t see why it wouldn’t be replicated here in Toronto.


Unfortunately, I do believe that the same thinking that went behind something like this, there’s no reason to think it wouldn’t be the exact same thinking by the politicians here in Toronto. That foreign investor, foreign buyer, boogeyman that everyone is constantly pointing at is the reason why all the problems exist in the world, or whatever, in the real estate world. They’re going to say, “Well, let’s pick on that person.” Again, nonvoting population, it only affects them. It’s an easy way to just look great in front of the voting population. Look what we’re doing for you. We’re out to help the little guy. I think it’s going to come here, too. I don’t know if it’s going to be the exact same thing. I don’t know if it’s going to happen right away, but certainly it’s just such an easy thing for them to do. It’s an easy way to actually get some extra income for the government, and so why not?


This is a land transfer tax. We saw the same thing in Toronto with the Toronto land transfer tax that came into place so many years ago. These kind of taxes that affect only a very small portion or no portion of the voting population are great. They’re a very smart thing to do if you’re a politician because it’s a great way to increase the revenue coming in dramatically without pissing off very many people or if any people at all, so they will continue to look at tools like that because that’s just … If you’re a politician and if you’re in the business of remaining a politician, then that’s a smart thing to do.


I am skeptical as you can tell and cynical about the process but, unfortunately, that is how I see it. The reason why I see it … I want to get a little bit more into why I see it that way is … My last couple of points here I want to get into and that is … The next point is that I don’t think it’s going to have any impact on the market at all. Again, if this was something that would do what it’s supposed to do, that is help the little guy, or help the first-time buyer, or whatever it’s supposed to do, then great. Let’s look at solutions for that. To me, this is not a solution that is going to do anything or have any impact on the market.


Why do I think that? Well, first of all, savvy buyers who most people who are foreign, nonresident buyers who are buying in foreign countries, they have lots of money. They are savvy by definition. They are smart by definition. They understand how to play the game. They will figure out ways around this kind of a tax. I know the government is going to look for ways to close the loopholes and not let it slip through the cracks, but there are ways and there are already many people talking about different ways you can get around this tax. I won’t get into that here. You can Google that. Savvy buyers will most likely figure out a way around paying this kind of a tax. That’s the first thing.


The second thing is that foreign buyers are such a small portion of the market. Again, there is very little to no data on this issue so why are we targeting them with such a heavy hammer? I do not know. Again, foreign buyers are at most 5 to 10% of the market. There’s no evidence even to suggest that foreign buyers are buying all the high-end properties and driving up the average prices by doing so or just taking over a certain segment of the market. There’s no data to suggest that. In fact, what little data there is seems to suggest that the prices that foreign buyers are paying and the properties they’re buying, the average price is very similar to the average price that the non-foreign buyers are buying, which is interesting in itself. I really don’t think this is going to have any impact on the market.


Again, if somebody wants to buy $2 million property in West Vancouver or whatever, are they going to worry if it’s 2.3 instead of 2? No. Why? Prices are going up 15%, 20% a year. You pay the extra 15% but it’s already covered in the appreciation that you get over the next 9 or 10 months. This is not something that’s going to stop somebody who wants to get a property for whatever reason in that city from doing so even if they do pay that tax as well.


The next point is that, to me, it sends a horrible signal to the world about Vancouver and about Canada. To me, this is not what I want Canada to stand for and to represent itself on the global stage. In the world of Trumpism, and Brexit, and building walls, and isolationism, and people looking to separate themselves from the scary other, whatever that is, somebody who’s not like them or somebody who lives somewhere else, to me, that is a step backwards. To me, that is not something that we, as a free and democratic society, should be doing.


We should be setting the example in the world of free markets and the power of a free market and a democratic process to be taxing foreigners like this so obscenely. If we’re talking about a 1% tax or whatever, whatever, okay, but we’re talking about 15% unprecedented, just heavy hammer to the head kind of a tax. Again, it reeks of isolationalism and there seems to be … I hate to say it but there seems to be an undercurrent of racism to it as well in targeting the very specific ethnic groups or countries that are not us. Again, the whole thing just reeks to me. This doesn’t feel right. It doesn’t feel good.


I should preface this whole podcast by saying I don’t really work with foreign investors. This is not somebody who’s speaking from a biased position of it’s going to affect my business dramatically or something like that. Very, very infinitesimally small percentage of my business are foreign buyers or nonresident buyers. Even those who are, they’re typically connected to Canada through their family and they’re purchasing real estate with or through their family as resident buyers anyways. This is not something that I’m speaking of because I think it’s going to affect me personally in anyway just to make that clear. I do think it’s really a bad look for Vancouver and for Canada around the world to have such a tax.


The final point is that I just think they’re trying to … I don’t know. I guess they’re trying to make property more affordable or get more access to property for first-time buyers, or reducing demand, or something like that in the market. It might actually have the opposite effect of what they’re trying to do. Again, we talked about this on the podcast a lot. All these taxes, and charges, and interventions by the government into putting their hand, dipping their hand into the housing pot to get a piece of the pie which is fine, which is what governments will do and we need more taxes, dollars to service an increasing population with increasing needs.


Again, economics 101, when you add new taxes, when you add new charges to property, these are inflationary pressures to prices. This is going to potentially increase, continue to worsen the increasing pricing because, again, when you’re adding stuff to the prices, ultimately who pays for that? It’s the next buyer. These costs are passed on. These costs are not absorbed by buyers in a vacuum that never … I’ll just gladly pay this money and never see it again. No. I paid this money out extra. Therefore, I’m going to to look to get that money back from the next buyer that I sell the property to. This is just, again, economics 101. These are inflationary pressures that will put upward pressure on pricing over time when you do these things, when you add cost to housing.


If you’re reducing cost and reducing taxation, that’s when you can increase competition. You can have more players and to the market, I believe. You will get lower prices as a result. You’re going to get nothing but higher prices if you continue to basically tax the crap out of the golden goose that is real estate in Canada, so I think we really need to be careful with what we’re doing with this thing called real estate in Canada.


Well, sure. I’m just criticising, criticizing, criticizing. What is my suggestion to improve the situation? Well, my suggestion would be, again, I agree with what’s already been said by a lot of people in BC especially, the only solution to this problem, if you want to call it a problem of rising property prices, is … The only solution is more supply. We’re not going to do anything on the demand side that’s going to have any consequence. We need more supply. We need more properties added to the market. We need more housing. We need more condos. We need more low-rise housing. We need everything. We need more rental options. As we get more supply, that is the only thing that is going to stem this rapid rise in prices. As governments around the country, that’s what the government should be doing is looking for ways to increase supply, increase options which will have a positive effect on pricing. If that is the goal of the government is to make housing more affordable for more people, then that is the side of the equation that they should be looking at is the supply side rather than the demand side.


That is enough ranting for one week. I hope you enjoyed some of those thoughts. Maybe you agreed with me. Maybe you disagreed with me. I love to hear your feedback. You can always reach me or hit me up on Twitter, Facebook. Give me a call 416-371-2333. Love to hear from you. Love to hear your thoughts on the issue and thank you very much for listening. Until next time. Happy investing and I hope you have a great week.


Speaker 2: Thanks for listening to the True Condos Podcast. Remember, your positive reviews make a big difference to the show. To learn more about condo investing, become a True Condo subscriber by visiting