This means beginning January 1, 2017, first-time buyers who are permanent Ontario residents, will not pay land transfer tax on the first $368,000 of the cost of their homes. Given lower prices in some of our areas of expertise, outside of Toronto, and in the West GTA & Hamilton area, this could mean no land transfer tax on the purchase for your first home. Or, at the very least, a savings of $4000 instead of the current $2000 with the NEW rebate in the new year!
Tenants are also getting a benefit, as the government freezes the property tax on apartment buildings — which are taxed at more than double the rate of other residential properties and condos, for example — while it reviews how the “high property tax burden” impacts the affordability of rentals.
To fund the breaks, the government will increase land transfer rates on houses that cost more than $2 million. For every dollar over and above that, the rate will rise from 2 per cent to 2.5 per cent.
But the tax on the portion of the purchase price between $400,000 and $2 million will remain at 2 per cent.
The rate between $250,000 and $400,000 stay at 1.5 per cent, and between $55,000 and $250,000 at 1 per cent.
And the rate for the first $55,000 of a purchase price will remain at 0.5 per cent.
The changes only affect properties with one or two single-family residences.
For other types of properties, such as apartment buildings, the only increase will be on the portion over and above $400,000, which will jump from 1.5 per cent to 2 per cent.
So it won’t make much difference to first-time house buyers in the city of Toronto, where the average selling price was $762,975 last month but here in the West GTA and Hamilton areas, it can will quite a difference if you are buying for the 1st time!
If you need clarification or have any questions, give us a call at (905) 512-5547 or you can email us at firstname.lastname@example.org or email@example.com We are always available to help and get answers for you!