Land Transfer Taxes: The good, the bad and the ugly

When buying real estate in Toronto there are two land transfer taxes, one city and the other province. On a $500,000 property the taxes together are just under $13,000. There are rebates of around $8000 for first time home buyers. The good: taxes help run the city and province. The bad: these two governments might be too dependant on this tax income. The ugly: these taxes are warping the housing market. Many home owners are staying where they are because they do not want to go through the added expense of paying land transfer taxes on a future property. Land Transfer Taxes on a property of $1,500,000 is about $52,950. This is reducing the amount of homes for sale and driving up prices because of a lack of supply. Land Transfer Taxes are the golden egg for the government but a rotten egg for homebuyers!