Hot month for Toronto real estate
By James Bradshaw - Globe and Mail
Toronto real estate sales continued their record-breaking pace in November, according to figures released yesterday, but opinions differ as to whether the growth was bolstered by a rush to close sales before Toronto’s new land-transfer tax takes effect.
The average sale price of a Toronto home last month was nearly $420,000. The purchaser of such a property on a deal closing after Feb. 1, 2008, would owe $4,125 in municipal property transfer tax on top of the $4,875 currently due to the province. (A first-time buyer would pay only $400 on the municipal portion as they are exempt from the first $400,000 of the purchase price.)
Von Palmer, government and media-relations officer for the Toronto Real Estate Board, said his organization believes the looming tax has played a role in November’s strong sales, although the effect is difficult to measure.
“Obviously it’s speculation at this point,” he said. “It’s anecdotal evidence, but a lot of clients are asking questions - they’re interested in the deadlines.”
The 16% increase in Toronto real estate sales over November, 2006, is not exceptional in a banner year where eight of eleven months have seen record-breaking sales. Mr. Palmer says the real indicator is November’s 23% growth in the 416 area code, where the tax applies, compared with only 11% in the 905 region.
“You’re seeing a rush in the 416 ahead of the tax coming into effect,” he said. “Can we peg that to the fact that there’s a land-transfer tax? Very difficult to say.”
Shelley Carroll, Toronto budget chief, was skeptical about whether the looming tax has had a significant effect.
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