Unseen consequences of Toronto's real estate slump leaves city strapped for cash
While Toronto's vacant home tax has been amassing millions for the city, other levies have been far less successful thanks to our tanking real estate market.
Home sales have slowed to a snail's pace owing to high interest rates and a generally unaffordable cost of living, yet prices are staying high, giving people little incentive to purchase right now.
This has meant a cut in earnings for not only realtors and other stakeholders, but also the city, which requires the buyer to pay anywhere from 0.5 per cent to 7.5 per cent of a home's value in land transfer tax (on top of a provincial tax of the same kind).
According to the latest data and as noted by Matt Elliott in his latest City Hall Watcher newsletter, revenues from this fee have fallen off a cliff, dropping around 40 per cent compared to last year and grossing $65 million less in the first six months of this year than expected.
And with the economic landsape not slated to improve anytime soon, we are on track for the trend to continue with more losses through the end of the year.
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