Hiking land transfer rate on $3M homes could pay for additional housing subsidies: councillors
Councillors Ana Bailão (left), Joe Cressy (middle) and Brad Bradford (right) are shown during a news conference at city hall on Friday morning. The councillors are calling for a new increased land transfer tax rate on homes sold for in excess of $3 million as a way to provide more housing allowances to low income residents.
Chris Fox, CP24.com
Published Friday, March 22, 2019 10:07AM EDT
Last Updated Friday, March 22, 2019 1:47PM EDT
A group of city councillors are calling for a new increased land transfer tax rate on homes sold for in excess of $3 million as a way to provide more housing allowances to low income residents.
As of December of last year, about 5,100 Toronto households were receiving monthly subsidies ranging from $250 to $600 as a way to address homelessness but a trio of city councillors, including Deputy Mayor Ana Bailão, want to see that program expanded.
The councillors have tabled a joint motion that will be considered by city council next week, which asks staff to report back on potential measures to expand the housing allowance program, including the creation of a new tier of the municipal land transfer tax.
Speaking with reporters during a news conference at city hall on Friday morning, Coun. Joe Cressy said that right now the highest land transfer tax rate of 2,5 oper cent applies to all homes sold for $2 million or more. He said that if the city were to introduce a new rate of 3 per cent for homes sold north of $3 million, it could raise $5.1 million in additional revenue per year. That money, he said, would be enough to pay for another 1,000 monthly housing allowances.
“You can look at this as housing paying for housing and in effect those who have benefited the most from the rise in housing prices ensuring that those who are struggling can afford to live here,” he said.
Sales involving $3 million plus homes have skyrocketed
According to city data, there has been a 353 per cent increase on the sale of $3 to $4 million homes since 2010 and a 376 per cent increase on the sale of homes for more than $4 million.
Coun. Brad Bradford, who is also among the councillors behind the motion, said that housing allowances have been proven as something that makes a “transformative difference” in people’s lives.
He said that the city needs to “offer those experiencing homelessness a viable path forward” and remember that “you cannot warehouse your way out of homelessness.”
“You need a way forward, you need a way out of the homeless cycle and by offering a subsidy of $250 to $600 a month the housing allowance program really is a critical tool that provides people with that opportunity,” he said. “I would also like to point out that this vital program doesn’t just offer cheaper rent for families in Toronto, it also offers stability and peace of mind and frankly in my view that is one of the most important elements of this program.”
The housing subsidy program is open to all low income residents; however the city is currently targeting people experiencing chronic homelessness, which it describes as those who have not had a place to live for six months or more.
The city, however, is expected to stop accepting new applicants to the chronic homelessness stream of the program sometime in mid-2019 due to a lack of funding.
In a statement issued on Friday afternoon, a spokesperson for Mayor John Tory’s said that he “recognizes the need to create new housing allowances” and will support the motion when it goes to council next week.
“He (Tory) plans to support this motion at city council and looks forward to seeing a report back from city staff on how we could create new housing allowances. He hopes the report will look at a wide range of options as to how to pay for these housing allowances,” the statement says.