GTA Residents Support Government Action On Red-Hot Housing Prices

Limited supply and ever increasing demand are driving housing prices in the Greater Toronto Area to record highs, with “bully” offers and bidding wars a fact of life for those seeking to buy houses in Toronto.

A majority of GTA residents (69%) also think the Province of Ontario and municipal governments need to do more to get affordable housing built in their communities

GTA residents recognize that the current housing situation is driven by a classic case of supply-and-demand economics. However, as federal, provincial and civic officials discuss steps to address concerns about the heated GTA housing market, a majority want their governments to intervene in the marketplace by taking steps to increase the supply of affordable housing and introducing taxes, including a foreign buyers’ tax, to discourage property speculation.

The recent 2016 wave of  our Focus GTA study among GTA residents shows a strong majority – including those living in the City of Toronto and those residing in the outer belt municipalities – support the introduction of a British Columbia-style 15-percent tax on real estate transactions involving foreign buyers (86%). Nearly nine in ten GTA residents (87%) also agree that if such a foreign buyer tax was introduced, it should be applied to all properties bought and sold in the GTA’s five municipalities, not just those located in the City of Toronto.

Counter arguments against a foreign buyer tax do not resonate with a large number of GTA residents: slightly fewer than two in five (38%) agree with the principle that governments should not interfere in the market by raising taxes to reduce housing prices. Meanwhile, relatively few residents (just 22%) feel it is discriminatory to charge non-Canadians a tax to purchase property locally.

A slightly smaller number (77%) are supportive of the Ontario government introducing a tax on those who leave their properties vacant, which some argue takes affordable housing out of the market.

A majority of GTA residents (69%) also think the Province of Ontario and municipal governments need to do more to get affordable housing built in their communities. Seven in ten (69%) believe government should offer tax incentives to developers to build more affordable housing units, with a similar number (66%) believing that an increased supply of housing will put a brake on rising real estate prices and result in a levelling-off after years of dramatic increases.

These results suggest GTA residents welcome a higher level of intervention by governments in the housing market, both by offering a carrot (tax breaks for developers) and a stick (taxes on foreign buyers) in their approach.

As affordable housing continues to grow as a public concern – and decreasing numbers of GTA residents (just 16%, down from 33% in 2013) believe housing in their communities is actually affordable – residents are supportive of their elected officials taking more significant steps to address the challenge.

About the survey: These results of this survey are from the Fall 2016 wave of Focus GTA, a semi-annual syndicated study of Greater Toronto Area residents. The Fall 2016 wave of Focus GTA was conducted from October 5-20, 2016 and included a representative sample of n=1,012 Greater Toronto area residents, including 503 residents of Toronto, and 509 residents of York, Peel, Halton and Durham regions. Environics set quotas for age, gender, income, region and PRIZM Social Group in order to ensure that the sample would be representative of the general population. Because this is an online sample, no margin of error can be ascribed.

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