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Timestamps:
00:00 Background Info for a 10.5% Toronto Property Tax Increase
02:20 #1: Approval and Effective Dates
03:33 #2: Investor Sell-Off
05:10 #3: Rent Increase
As we step into 2024, the real estate market is unveiling a major consequence that's sparking heated debates. In this video, we'll dive into the repercussions of a sluggish real estate market, particularly focusing on the often-overlooked aspect of land transfer taxes and their influence on the city's financial landscape.
🏙️ Key Points:
1. The Financial Strain on Toronto:
👉 In 2022, Toronto witnessed over 27,000 property transactions, contributing a staggering $948 million in land transfer tax revenue.
👉 However, 2023 saw a 12.3% decline in transactions, reflecting a potential $114 million drop in the city's income from land transfer tax.
👉 With the city already grappling with a $1.8 billion deficit, officials propose a 10.5% property tax increase for 2024.
2. Potential Investor Sell-Off:
👉 High-interest rates are already pressuring investors, leading some to offload their units.
👉 The proposed 10.5% property tax increase translates to an extra $21 per month for a typical 1-bedroom condo in downtown Toronto.
👉 While some investors may consider selling, the overall impact might not be as severe, with only 3% of managed units showing intent to sell in 2024.
3. Rent Implications - A Closer Look:
👉 The burden of financial shortfalls often falls on landlords, prompting potential rent increases.
👉 Units under rent control face a guideline increase of only 2.5% for 2024, significantly below inflation rates.
👉 An extraordinary increase in municipal taxes, like the proposed 10.5% property tax hike, allows landlords to file for rent increases above the guideline.
👉 However, the process raises concerns about the Landlord and Tenant Board's functionality and the potential inconsistency in granting percentage increases.
🤔 Your Thoughts Matter:
👉 Share your perspective on the proposed property tax increase in the comments below.
👉 How do you think it will impact investors, property owners, and renters alike?
📅 Upcoming Decision:
👉 The 10.5% property tax increase is currently a proposal, pending approval on February 14 after consultations and committee meetings.
👉 Stay tuned for updates on this channel as we navigate through the developments in 2024.
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