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President's Toronto SUN Column

TREB President's Column as it appears every Friday in the Toronto Sun's Resale Homes and Condos section.


Land Transfer Taxes Unfair to Home Buyers

September 30, 2011 -- If you are a regular reader of this column, you will know that REALTORS® are no fans of land transfer taxes, which are paid by home buyers when they purchase a home. We strongly believe that home ownership is something that all levels of government should be encouraging, not discouraging with punitive taxes directly targeted at home buying. That's why we are calling for governments to re-think where they stand on these taxes.

Land Transfer Taxes are substantial. In Toronto, the average home buyer pays close to $12,000 in land transfer taxes, about half to the provincial government and about half to the City of Toronto, each of whom have their own land transfer tax. Home buyers in the rest of the province only pay the provincial land transfer tax.

As mentioned, REALTORS® oppose these taxes. For years, we have been fighting to prevent them, eliminate them and reduce their burden on home buyers. We have led the charge against the City of Toronto Land Transfer Tax, and we are proud to say that we are working closely with Mayor Rob Ford towards the fulfillment of his commitment to repeal this tax.

I don't have anything good to say about the City of Toronto Land Transfer Tax, but I will say this: the City's Land Transfer Tax rebate for first-time buyers is better than the provincial government's. First-time buyers in the City of Toronto are eligible for a rebate of the City's land transfer tax to a maximum of $3,725, the land transfer tax on a $400,000 home; whereas the maximum for a provincial land transfer tax rebate is only $2,000, the equivalent of the land transfer tax on a $227,500 home.

Unfortunately, with an average home in the City of Toronto currently costing home buyers about $12,000 in land transfer taxes, that means first-time homebuyers still pay a balance of over $6,000.

Land transfer taxes are charged based on the price of a home; the higher the price, the higher the tax. In the past, when home prices were lower, the provincial land transfer tax rebate essentially provided for a complete exemption for first-time buyers. However, from 1996 to 2010, the average price of a resale home in Ontario went up 120 per cent from $155,725 to $342,245. Specifically in the GTA, where average prices went from $198,150 to $431,463 over the same time period, homebuyers are at an even bigger tax disadvantage due to higher prices compared to the rest of the province. During the same period, the provincial government increased their Land Transfer Tax rebate by only $275 or 16 per cent. As a result, a first time home buyer today in Ontario pays $1,500 in LTT more than the previous generation on an average priced home after receiving the rebate; in the GTA, they pay $3,100 more in LTT.

REALTORS® are therefore urging all candidates running in the 2011 Ontario Election to support increasing the LTT rebate for first time home buyers from $2,000 to $3,500. This would return fairness to the LTT rebate program and allow present day first time home buyers to enjoy the same tax savings as buyers in previous years.

REALTORS® will continue to oppose land transfer taxes. We believe that no home buyer should have to pay these punitive taxes and will continue to work towards that objective.

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Archive
Note: All links are PDF files

 2011
September 23 Energy Rebates Should Be A Priority
September 16 Tell City Hall to Target Waste, Not Home Buyers
September 2 Realtors ride for a great cause
August 26 Strong economy sees numbers boosted
August 19 New Web Site Easy to Use
August 15 Learn to keep termites at bay
August 9

Public and Businesses See Eye-to-Eye on Municipal Finance Issues

July 22 Know when it's time to renovate
July 8 Treat first-time buyers fairly
June 17 Time To Repeal The Land Transfer Tax
June 10 Take a tour of the virtual office
June 3 Parking red tape should be streamlined
May 27 Helpful Advice Is Keystrokes Away
May 20 Taking a walk through REALTOR® QUEST
May 13 The social side of real estate
May 6 Staying on top of municipal issues
Apr. 29 Expect demand to remain strong
Apr. 22 Know what to look for in a condo
Apr. 15 Choosing between new and resale
Apr. 8 Learn to use the tools of the trade
Apr. 1 Expect demand to remain healthy
Mar. 25 City needs to cut parking red tape
Mar. 11 Select the right neighbourhood
Mar. 4 Consider investing in a fixer-upper
Feb. 25 Expect homes to remain affordable
Feb. 18 REALTORS® help clarify parking rules
Feb. 11 Learn the benefits of going online
Feb. 4 Increase the value of your resale
Jan. 28 Know the value of a REALTOR®
Jan. 21 Move is on to repeal an unfair tax
Jan. 14 Choose a home that fits your style
 2010
Dec. 17 Working Hard to Make a Difference
Nov. 19 Sorting out HST misconceptions
Nov. 12 Give more thought to going green
Nov. 5 All signs point to a healthy market
Oct. 29 Green your home and save money
Oct. 15 Keeping your best interest in mind
Oct. 8 All signs point to a healthy market
Oct. 1 Condos have become a way of life
Sept. 24 Setting the HST record straight
Sept. 17 Coming to 'Terms' with Real Estate
Sept. 10 Growing Up and going green
Sept. 3 Keeping your best interest in mind
July 16 Charity begins and ends at Home
July 9 Saving the HST with Resale Housing
July 2 Recognizing Our Volunteer Efforts
June 25 Getting to know all your options
June 18 Embracing Diversity in the GTA
May 28 REALTORS® need to know quite a lot
May 14 April transactions nearly met record
May 7 Shopping for the best deal in Town
Apr. 30 The Hidden costs of moving
Apr. 23 Knowing all the local options
Apr. 16 Many ways to cut energy costs
Apr. 2 It pays to renovate before you sell
Mar. 26 Working in your best interests
Mar. 12 Growing Tax burden is taking its toll
Mar. 5 A Professional Touch
Feb. 26 Registry links buyers to homes
Feb. 19 Mitigating the HST tax threat
Feb. 12 Expect strong start to 2010 to continue
Feb. 5 Helping those in desperate need in Haiti
Jan. 29 Having a green home provides savings and peace-of-mind
Jan. 22 REALTORS® assist with Rentals Too
Jan. 15 REALTORS® Give Back
Jan. 8 Why our REALTORS® are the envy of the world
 2009
Dec. 11 Making the jump to home ownership
Dec. 4 Your kind of town, Toronto is
Nov. 27 Emerging Neighbourhoods
Nov. 20 Mid-Month market report: The economic recovery continues
Nov. 13 There's More to us than MLS
Nov. 06 Fix-up Frenzy
Oct. 30 A Taxing Issue: Let's call on future mayor to roll back LTT
Oct. 23 Where to buy
Oct. 16 Value Added
Oct. 10 Market report
Sept. 25 NO sense of harmony
Sept. 18 Vertical City - The GTA is growing up and going green
Sept. 11 Go Site-seeing
Sept. 04 A changing shade of grey
August 28 Gateway to the World
August 21 Vertical City – Toronto is Growing Up
August 14 A new way to hunt for homes
August 7 Home Away from Home
July 31 The Canadian Dream
July 24 Move or Improve
July 17 Weathering the Storm
July 10 Mid-year market report
June 26 Making the Right Connections
June 19 Condo City
June 12 More co-op on grow ops
June 5 Investing in Real Estate
May 29 The News is Good
May 22 Ownership Housing Plays Important Role
May 15 REALTORS® Invest Time to Improve
May 8 REALTORS® take message to Ottawa
May 1 REALTOR® Education
Apr. 24 Community Spirit Alive
Apr. 17 Tech tools of the trade
Apr. 10 Public Wants Toronto Land Transfer Tax Repealed
Apr. 03 Invest In Future
Mar. 27 Agents of Change
Mar. 20 Harmonized Sales Tax Would Hurt Home Buyers
Mar. 13 Actions Speak Louder than Words on Affordable Housing
Mar. 06 Market review: 2009 so far
Feb. 20 Scholarships offered by real estate board
Feb. 13 Make Home Owners Priority of City Budget
Feb. 06 Federal Budget Helps Home Buyers and Owners
Jan. 30 January's Resale Housing Market Report
Jan. 23 TREB to Feds: More help to Homebuyers
Jan. 16 Lifestyles in the 416 and 905
 2008
Dec. 19 Be prepared for closing costs
Dec. 12 Toronto Land Transfer Tax Costs City's Economy $170 million
Dec. 5 Understand your privacy and rights
Nov. 28 Seasons of Real Estate
Nov. 21 Setting the Stage for a Sale
Nov. 14 The Ins and Outs of Inspections
Nov. 7 Outlook still good for GTA
Oct. 31 Taking Advantage of Taxes
Oct. 24 The Ins and Outs of Insurance
Oct. 17 Fighting Back Against Fraud
Oct. 10 Local Market Holds Steady
Oct. 3 Show Good Form During a Deal
Sept. 26 Using Equity to Your Advantage
Sept. 19 Choices Abound but Choose Carefully
Sept. 12 GTA Housing Market Stable
Sept. 5 Points to Ponder This Fall
Aug. 29 Don't Take This For Granted
Aug. 22 A Helping Hand
Aug. 15 A Market Report for July
Aug. 8 A Primer on Attracting Buyers
Aug. 1 Returns on RENOs
July 25 New Federal Mortgage Rules
July 18 Revitalizing the Big Smoke
July 11 Condos Changing the GTA
July 4 Feeding the City's Future
June 27 Recognizing Volunteers
June 20 Buyers, Be Aware of the New Rules
June 13 The Market Remains Healthy
June 6 Reasons to Pick a REALTOR®
May 30 The Power of MLS
May 23 Greening Up Resale Homes
May 16 A Quest for Knowledge
May 9 Lobbying Goes a Long Way
May 2 Toronto Compared
Apr. 25 Beware of Hidden Development Charges
Apr. 18 From the President
Apr. 11 Guarding Against Grow-Ops
Apr. 4

The Importance of the Budget

Mar. 28 Another Way to Invest in Real Estate
Mar. 21 Federal Budget Misses Opp
Mar. 14 Prepare Now for a Spring Move
Mar. 7 Remember to Budget for City's Budget
Feb. 29 From the President