The board, representing 64,000 real estate agents in Ontario, warned that the speculative tax would hurt the stability of small investors. The motion, introduced on December 15, 2021, would ask the
Toronto Prices Surging Due to Investment Properties - Report
Dated: December 2 2021
According to a Bank of Canada report, buyers grabbing up investment properties are causing the pricing surge in the Toronto real estate market, making it even more likely for an impending correction.
Paul Beaudry, the Bank of Canada's deputy governor, warned on November 23 that the excessive buying of secondary homes could be self-fulfilling now and catastrophic later. The damage caused by a sharp fall in house prices can be felt far beyond the investors who bought the property. Many households have homes worth less than what they're paying or have paid.
“A key concern here is that financially stretched households have little breathing room to absorb any disruption to their income,” Beaudry says. This is the time of year when many homeowners are seeing massive price gains and scooping up properties by leveraging the equity in their primary homes - which leaves many first-time buyers unable to find homes to buy.
According to a report by Teranet, about 25% of the people who purchased a home between January 2011 to August 2021 were multi-property owners. According to Teranet, the majority of multi-property owners are gen-Xers and generational households with multiple buyers. Millennials were only 22% of those buyers.
While many investors are looking for future immigration to take advantage of the current market conditions, they are also driving up the prices of their properties in the meantime.
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