April 20, 2017 / 12:33 PM / a year ago

Ontario set to slap foreign buyers tax to cool Toronto property market -report

TORONTO, April 20 (Reuters) - Canada’s Ontario province is set to announce a series of measures including a 15 percent non-resident foreign buyers tax on property purchases to rein in runaway housing prices, the Canadian Broadcasting Corp (CBC) News reported on Thursday.

Ontario Premier Kathleen Wynne will unveil the measures on Thursday morning at 9:00 a.m. local time, including a ban on flipping of pre-construction units by speculators and a rebate of development cost charges to encourage more rental housing, the CBC News report said, citing people with knowledge of the announcement.

The government is also planning to expand the province’s existing rent control system to cover all tenants, ending the exemption that currently allows unlimited rent increases, it added.

The steps to cool Toronto’s hosing markets comes after Canada’s top federal and provincial officials agreed this week that moves were necessary to bring in Toronto’s roaring housing sector under control.

The average price of a home in Toronto rose by 33 percent to C$917,000 in March from a year earlier, recent data showed, adding urgency to the need for government action. A report this week also showed national prices were up 18.6 percent from a year earlier as strength in Toronto spilled over into nearby cities.

Toronto is Canada’s biggest city, and the runaway house prices have become a headache for the government with many first home buyers priced out of the red-hot market. With public frustration growing, federal Finance Minister Bill Morneau met with Ontario Finance Minister Charles Sousa and Toronto Mayor John Tory earlier this week.

Premier Wynne’s press secretary was not available for an immediate comment. (Reporting by Denny Thomas; Editing by Bernard Orr)

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