The Toronto Regional Real Estate Board (TRREB) has submitted formal input to all levels of government on options for economic recovery initiatives. While TRREB has set out a list of specific policy options, its key message is to use caution in implementing demand-side real estate market stimulus.
Toronto Regional Real Estate Board President Lisa Patel announced that Greater Toronto Area REALTORS® reported 8,701 sales through TRREB’s MLS® System in June 2020. This result represented a very substantial increase over the May 2020 sales result, both on an actual (+89 per cent) and seasonally adjusted basis (+84 per cent), and was only down by 1.4 per cent compared to June 2019.
With the City of Toronto’s Executive Committee considering a report today, with options to improve affordability for first-time home buyers by providing relief from the City’s Municipal Land Transfer Tax (MLTT), the Toronto Regional Real Estate Board (TRREB) is calling on the Committee to move ahead with longneeded adjustments to the MLTT First-Time Home Buyer Rebate.
“First-time home buyers have been unfairly penalized by the MLTT for years. Adjustments to the MLTT first-time buyer rebate are long overdue,” said Michael Collins, TRREB President.
The average price of a residential property in the City of Toronto at the start of 2008, when the MLTT was first implemented, was $415,000, and the MLTT first-time buyer rebate was allowed up to a maximum of a $400,000 home, meaning that first-time buyers were almost completely exempt from paying any MLTT, as was City Council’s intention. The average price of a City of Toronto residential property is currently $881,000, and the MLTT first-time buyer rebate is still only allowed to a maximum of a $400,000 property. This means that a first-time buyer purchasing an average priced property today would pay $9,620 in MLTT, on top of about $10,000 of Provincial Land Transfer Tax (PLTT), for a total of about $20,000 in land transfer taxes, which must be paid up front on closing of the real estate transaction.
“Clearly, City Council’s intention of providing relief for first-time home buyers, up to the average priced property, is no longer being met,” added Collins.
Not only are first-time buyers not being given the relief that was intended by City Council, they are being forced to pay MLTT at the highest rates, even if they purchase a below average priced home. This is because the MLTT rate structure is such that the highest rates kick in starting on homes priced at only $400,000, which is 55% below the current average price. As noted by the City staff report being considered by the Executive Committee, two-thirds of first-time home buyers purchase homes priced between $400,000 and $800,000, well below today’s average home price in Toronto.
“The City is essentially forcing people, including first-time buyers, purchasing BELOW average priced properties to pay the highest MLTT rates. This is simply not progressive or fair,” said John DiMichele, TRREB Chief Executive Officer.
The City staff report, and TRREB survey research (conducted by Ipsos Public Affairs), show that the number of firsttime buyers entering the real estate market has been declining significantly in recent years. TRREB believes that this is largely because of affordability issues.
“First-time buyers are increasingly being priced out of Toronto’s real estate market and the Municipal Land Transfer Tax has exacerbated this. It is time to make adjustments to the MLTT rebate for first-time buyers, so that they receive the relief that was always intended by City Council,” added DiMichele.
TRREB has provided its detailed written input to the City’s Executive Committee, and will be monitoring the City’s actions going forward.
Racism against any group is unacceptable. Recent incidents of anti-Black racism have caused shock and outrage worldwide. The Toronto Regional Real Estate Board (TRREB) is equally concerned about anti-Black racism and acts of racism against any group in our society.
TRREB is proud to serve a membership of over 56,000 that is a microcosm of Greater Toronto Area (GTA) residents. Our Members, leadership and TRREB staff reflect and serve communities made up of individuals from diverse ethnic, racial and multicultural backgrounds.
TRREB firmly believes that the GTA’s diversity is one of its greatest strengths. It requires us to collectively work together to preserve this.
Please do your part to embrace inclusion. We promise to do ours. It is up to all of us to listen to those whose lives are different from our own, and to do our part to ensure and reflect justice, compassion, and empathy.
We are professionals connecting people, property and communities. We welcome your input and thoughts on how we can improve our communities together.
Greater Toronto Area REALTORS® reported 4,606 sales through TRREB’s MLS® System in May 2020. This result was down by 53.7 per cent compared to May 2019. While the number of sales was down substantially on a year-over-year basis due to the continued impact of COVID-19, the decline was less than the 67.1 per cent year-over-year decline reported for April 2020.
Toronto Regional Real Estate Board President Michael Collins announced that TRREB contracted Ipsos Public Affairs to provide up-to-date information on consumer sentiment related to the housing market and the specific impact of the COVID-19 pandemic. The Ipsos online survey captured home buying and selling intentions along with consumer opinions on preferred government policy directions related to the housing market.
The Toronto Regional Real Estate Board has received an additional $278,000 in Ontario REALTORS Care® Foundation grants to help support shelterbased charities across the Greater Toronto Area during this unprecedented time. This supplements the $713,000 that TRREB already provided in grants to shelter-based charities in the Greater Toronto Area (GTA) at the end of 2019.