Kingscrest estates . The property vacancy tax is coming! Starting from next year, owners in Toronto will declare whether their houses are vacant for more than six months within a year. Undeclared properties will be considered vacant by the city government, and owners will have to pay a 1 per cent vacancy tax (Vacant Home Tax,VHT).
Penelope Graham, executive editor of online real estate platform Zoocasa, believes that the housing vacancy tax will stimulate housing supply, but whether it will cool property prices remains to be seen.
‘House prices in Toronto have continued to rise over the past decade, ‘Mr. GE said. The average house price rose to 1079749 yuan in June this year, up 126 per cent from June 2011. The epidemic has also contributed to the continuous rise in property prices. in January last year, the average house price was only $839363, which increased by 28% in a year and a half.
There has been a serious shortage of housing in Toronto for a long time. When Vancouver introduced the housing vacancy tax in 2017, the vacancy rate was only 0.7%, she said. Since the implementation of the policy, more than 5000 Condo or long-term leased properties have been added to the rental market. Vacant housing decreased by 25%, and the Vancouver city government also increased revenue by 61.3 million yuan. In an effort to further force owners of more than 2000 houses to let down rents, the Wenzhou government raised the vacancy tax to 3 per cent last year.
The Toronto City Council approved a vacancy tax that will be levied in 2022, and owners are required to declare to the government whether the property is vacant. The city government will not formally collect the vacancy tax until 2023. Owner death, medical treatment, Snowbird or decoration can be exempted. The Toronto city government estimates that the housing vacancy tax will reach 55 million to 65 million yuan.
Mayor Zhuang Deli stressed that the purpose of the vacancy tax is to force owners to rent vacant properties, not to increase Treasury revenue. After deducting administrative expenses, all of the tax will be used for the construction of affordable housing and related projects.