Ontario budget to include housing affordability measures

TORONTO — Ontario Finance Minister Charles Sousa confirmed Monday he plans to include housing affordability measures in his upcoming budget. Premier Kathleen Wynne has said her government is working on a “comprehensive set of plans,” to deal with rising home prices in the Greater Toronto and Hamilton Area (GTHA), as well as rising rental rates. Sousa said he’d like to include those plans in the spring budget.

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There is a “suite of options” available to the province, but the province must be careful to avoid “unintended consequences” from those measures, he said. Sousa also spoke about pressures on both the supply and demand side of the GTHA housing market. “Demand is high for a number of factors,” he said. “Could be speculators, could be people from outside the country, it could very well be the many who are now moving into Ontario creating that demand.” “The degree of supply is in question and how to expedite that is also something we’re trying to address,” he added. The housing package in the budget will concern the red-hot housing market in the GTHA, while taking into account different circumstances in the rest of the province, Sousa said.

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Just prior to the release of the federal budget, Sousa had asked federal Finance Minister Bill Morneau for changes to the taxation of capital gains on the sale of homes that are not classified as a primary residence, as a way to address speculative investors flipping homes. Speculative investing in the real estate market — buying a home in the hope of turning a profit rather than to live in — is believed to be one of the culprits behind the soaring house prices. While Sousa’s wish wasn’t granted in the federal budget, Morneau did not rule out capital gains changes in the future. No date has been set for the Ontario provincial budget, but it’s expected in the coming weeks.