Toronto residents continue to express concern about how municipalities raise revenue, and the Municipal Land Transfer Tax (MLTT) remains a top concern. The Toronto Regional Real Estate Board (TRREB) is calling on municipal candidates to address a significant upfront cost facing homebuyers, including modernizing the outdated first-time homebuyer MLTT rebate and reducing the onerous MLTT upfront closing cost. The proposal announced today is encouraging and will be a significant step in providing relief to homebuyers.
The MLTT, combined with the provincial Land Transfer Tax, now totals approximately $36,000 on an average-priced Toronto home as an upfront closing cost.
New Ipsos polling commissioned by TRREB shows that 416 residents are deeply concerned about housing affordability and more than half of Toronto residents (56 per cent) say the City depends too much on the MLTT, placing it alongside property taxes as one of the most overused municipal revenue tools. Toronto remains the only municipality in Ontario with a second land transfer tax, in addition to the provincial land transfer tax, making it one of the highest-taxed housing jurisdictions in North America.
By comparison, when the MLTT was first introduced in 2008, a first-time buyer was not required to pay the MLTT after applying the rebate. The MLTT suppresses housing supply by adding thousands of dollars in costs at the time of title transfer when a property is sold.
After almost 18 years, the Toronto Land Transfer Tax has not made our City more affordable. Reforming the MLTT to provide relief to all homebuyers will help first-time buyers, individuals, growing families, and seniors looking to right-size and stay within the community they have called home for decades.
When young people and families are priced out of Toronto, the long-term consequences extend far beyond housing. As more of the next generation moves elsewhere, businesses will face growing challenges attracting and retaining the skilled talent they need to succeed, which will affect Toronto’s economic competitiveness and may undermine the City’s future growth and innovation.
Daniel Steinfeld
TRREB President