It all started on April 10th, 1974.... Ontario introduced a Land Transfer Tax (LTT) when we bought a home. First there was one LTT in the City of Toronto, now there are 2. Here's a quick history of what is was then and how it got to where it is now!
April 10, 1974
- 0.3 per cent up to $35,000 and 0.6 per cent on the balance
- Average house price was $52,806
- Average LTT was $211.84
Five years later, it got worse.
April 11, 1979
- 0.4 per cent up to $45,000, 0.8 per cent on the balance
- Average house price was $70,830
- Average LTT was $386.64
Seven years later, it got worse.
Jan. 1, 1986
- 0.5 per cent up to $55,000, one per cent on the next $195,000 and 1.5 per cent on the balance
- Average house price was $138,925
- Average LTT was $1,114.25
Three and one-half years later, it got worse.
June 1, 1989
- 0.5 per cent on the first $55,000, one per cent on the next $195,000, 1.5 per cent on the next $150,000 and two per cent on the balance
- Average house price was $273,698
- Average LTT was $2,580.47
Nineteen years later, it got far worse for Torontonians.
Spring, 2008
- In addition to the provincial LTT, Toronto home buyers were saddled with the Municipal LTT: 0.5 per cent on the first $55,000, one per cent on the next $345,000 and two per cent on the balance
- Average house price was $379,347
- Average LTT was $7,683.68
Nine years later, it got worse for some Torontonians.
March, 2017
- 2.5 per cent on the portion of purchase price over $2 million
Today, by leaps and bounds, the City of Toronto the highest land transfer tax rates in Canada. A $1,000,000 home has Land Transfer Taxes (Provincial plus Municipal) of approximately $33,950! A $700,000 condo costs about $20,950 in both Land Transfer Taxes. However, purchasing north of Steeles Avenue, which is the City of Toronto's boundary limit there's a little respite with only one LTT payable - and that's the Provincial one.
So, while average prices have gone up over 1,480 per cent since 1974, Land Transfer Taxes (in the City) have increased by 9,528 per cent! That's 6.45 times faster than house prices.
And remember, that as Buyers, we're paying the LTT in after-income-tax dollars, as we do HST, gas and liquor taxes. Sadly, there's no benefit to us, but a huge windfall for the City of Toronto and the Province of Ontario.
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