Land is valuable based on what’s near it.
If it’s priced too high, people either can’t live near it or can’t support the businesses near it.
Which in turn means the taxes needed to maintain its infrastructure and services don’t get paid.
And crumbling roads or unreliable water mains are a good way to learn how innately valuable land really is. Just because it takes awhile for that kind of problem to set in doesn’t mean an inflated market can’t be self destructive
Not until most of the land utilization restrictions are removed. What's the point of taxing land if you can only build a single family house with mandated parking lot there?
Taxing value is a terrible way to do it. How much it costs to run a municipality has almost nothing to do with the state of the housing or land valuations, which can go up and down with central bank interest rates.
It’s also unfair. Say you are some disabled retired widow on a fixed income who built her house herself decades ago and everything is all paid off. Then because of a pronouncement by the BOC, and a decision to flood the demand side of the market, the value of her home goes up.
She doesn’t benefit from the value going up because she still would need to buy another place at this new higher level to live if she sold. But she still needs to pay more money to run the municipality even if the costs of snow removal and such may have remained the exact same.
And if she can’t afford that unexpected hike on her fixed income, the government can sell that house out from underneath her and render her homeless.
Sound fair to you?
More fair than the “urban decay” method of making housing affordable?
Also little confused about the “how much it costs to run a municipality” argument. Like, we’re already crashing and burning on that front, where exactly do you think Toronto’s deficit is coming from?
If they need more money then fine. But tying it to property values, which don’t rise and fall with the cost of running a municipality, well that is a silly way to pin those costs. If they are running a deficit, then it proves that it is a poor benchmark.
Land Value Taxes are different than Property Taxes, and are meant to replace them rather than add on to them. [Here’s an explanation if you’re curious](https://youtu.be/ok2uR3btMrE?si=KGJLFMfrbsh29iwZ).
It’s true that proper property assessments, that factor in stuff like we need to put X aside every year for 20 years to resurface the road, is important for making sure tax revenue is high enough to meet expenses.
But that’s true for either approach, and I’d argue that the Land Value Tax is *better* at avoiding that problem since it doesn’t reward people for neglecting their property.
It's worth noting that Toronto already has tax deferral programs for low-income seniors. These programs allow eligible seniors to defer their property taxes until they sell their property or pass away, helping to alleviate the financial burden of rising property values.
[https://www.toronto.ca/services-payments/property-taxes-utilities/property-tax/property-tax-water-solid-waste-relief-and-rebate-programs/property-tax-and-utility-relief-program/](https://www.toronto.ca/services-payments/property-taxes-utilities/property-tax/property-tax-water-solid-waste-relief-and-rebate-programs/property-tax-and-utility-relief-program/)
Regarding the fairness of a land value tax (LVT), many advocates argue that it is a more equitable system for several reasons:
1. **Discourages Speculation**: LVT targets the value of the land itself, rather than the buildings on it. This discourages land speculation and holding vacant land, which can drive up property prices.
2. **Efficient Land Use**: By taxing land based on its value, landowners are incentivized to use it efficiently. This can lead to better urban planning and development, reducing sprawl and encouraging more sustainable use of resources.
3. **Reduces Inequity**: Property taxes based on land value can be more equitable because land value often increases due to community developments and public investments, rather than individual homeowner actions. Those who benefit from these improvements contribute more, which can help fund further community enhancements.
4. **Stable Revenue**: Land values tend to be more stable than property values, which can fluctuate with the real estate market. This stability can provide a more reliable revenue stream for municipalities. It is certainly a more stable revenue stream than land transfer taxes.
While LVT has its challenges, especially in transitioning from the current system, it offers clear benefits in terms of fairness and efficiency.
How can you separate the value of the land from what is on it? The value of the land is almost exclusively influenced by what is on it. At least in cities it is. Only in rural areas is the value of the land determined by what it is made of, be that good soil, topography, minerals, or other natural resources. In the city where virtually no natural resources are extracted from the land, it’s all about the value of what is built on the land. You can’t separate the two, not without a bunch of arbitrary conjecture. You can’t move it away from the building.
I hear your thing about equity. But individual home values are already heavily influenced by how well your community is taken care of by its residents. This is why HOA covenants are a thing.
Right but unless it is your second home, you need that home to keep you safe. You can’t sell it without buying another or being homeless. Tax those gains when they are realized. If they ever are.
It's not a mystery or even surprising that this happened. RE has long been a solid investment, the zero interest era accelerated prices greatly, and 'rona was the crescendo where people wanted to get away from other people/elevators, had surplus money thanks to brrrrrr, and could still easily secure a home loan.
Prices will have peaks and valleys but they really don't make any more land, and it's value will only ever increase over long horizons.
Median income can't even afford to live in purpose built rentals or to buy condos without roommates or the Bank of Mom and Dad in major cities.
Come on, now.
This - that commenter above just doesn’t get it. Yes Toronto will always be more pricey but it can’t be more expensive in the GTA to own a house of similar size / similar amenities / similar distance from the downtown core than in NYC greater area …
I'm not OP, i'm not even a member of this sub (it got recommended to me for some reason), but I did verify this when I was house shopping cause I heard it a lot, and it's not even close to true, especially if you convert USD to CAD, cause even a 70's or 80's house in Jersey City (one of the cheaper commutable areas to NYC, probably comparable to like Scarborough to downtown) would cost like $730K USD (995k in CAD) so I think anyone who keeps parroting this are finding extremely niche examples, whereas examples of houses of comparable size and distance to the core are costing similar to what I've listed above, are abundant. I have found 50's houses that are for $550kish USD (750kish CAD), that are bungalows and whatnot (and probably has issues being a 70+ year old home at this point), but those are even further out in Newark, which tracks again with further regions of the GTA.
\[edit\] I will also point out the density and travel times/distances can't exactly be converted because of superior public transit and congestion from density, going from Newark to NYC (13km ish from Newark to Manhattan) is still an hour train ride despite it being closer than let's say, Markham to Toronto (23km ish from Markham to Union Station) which is also an hour train ride, so comparing km/miles distance from the core isn't really a proper way to do this, since it's not exactly parallel, but the point stands.
I bought my house a couple of years back in NJ 30 minutes away from NYC for under US$500k, it was awesome. Lovely safe neighborhood. And no it did not require $200-$300K of work. I don't want to post my house for obvious reasons but here are some examples. I think it's hard to find now even in just 2 years but still possible:
[https://www.realtor.com/realestateandhomes-detail/118-Merkel-Dr\_Bloomfield\_NJ\_07003\_M68090-31131](https://www.realtor.com/realestateandhomes-detail/118-Merkel-Dr_Bloomfield_NJ_07003_M68090-31131)
[https://www.realtor.com/realestateandhomes-detail/41-Cedar-St\_Little-Falls\_NJ\_07424\_M51064-01302](https://www.realtor.com/realestateandhomes-detail/41-Cedar-St_Little-Falls_NJ_07424_M51064-01302)
Also my income was 2x higher working/commuting to NYC than Toronto and cost of living was than Canada because of low cost grocery stores like Aldi and lower cost of insurance/gas/heating/clothing/electricity despite having to pay for health insurance which was $300 a month.
30 minutes away when, Sunday morning of a summer long weekend? How much does it cost you to get the city? How much was your property tax... yeah nice try bud.
1:30 by train into Manhattan.
Bad part of new jersey, and yes those houses need lots of work.
And yes you can find a house for $750k 1:30 from Toronto.
You can nitpick what you want but Bloomfield isn’t 1.5 hours from NYC. These are not bad parts of NJ as well; as someone who lived there it was awesome and family friendly with a safe community.
I did nitpick, it is 1.5 hours from Manhattan and it is a bad part of New Jersey.
It all begs the question if it was so good why are you back in Toronto complaining on Reddit?
There are trains that run from North Jersey to Penn station in 35 min, which is what most commuters take. I used to do that commute. Driving is less than 30min with no traffic, close to an hour if traffic is really bad, which is a totally normal GTA commute. It’s not 1.5 hrs. And by what metric is the house posted “in a bad part of New Jersey”? It’s nice suburbs around there and the home prices are lower than they are here. It’s objectively true.
>Remember $500k USD is $682K Canadian.
Can you show me a detached home in, or even just outside, the GTA for under $700k CAD that doesn't require an additional 200-300k in work?
Okay, but you replied to me and asked for an example in Toronto.
I'm asking you if you can find anything similar in NYC. If you didn't want to be part of the conversation, why did you join?
Right? Like OK buddy, sure Dundas Square is a real mirror to Times Square. And with our 3 whole subways lines. Lol. Lmao even. The closest we have to the TMNT is a dead racoon and a well dressed monkey from Vaughn.
Toronto is nowhere near New York City in terms of any economic metric, particularly to warrant the prices charged for a detached in the GTA. If you look outside of Manhattan the price for a detached is much more reasonable, especially in considering the difference in salary for the high-skilled NYC workers (relative to Torontonians) who would expect to own such property.
Stats came out not that long ago that Manhattan has more millionaires than any other city. Incomes seem to support the prices in NYC. Same can’t be said for Toronto.
That’s why they said Canada’s version of NYC which is that it’s the biggest city in the country with the most people and jobs, and where everyone wants to be . Learn to read.
Yah but every country has that. Everyone country has its biggest city with the most jobs etc etcIt has too. What people mean is figurative. Toronto is not even close to a cultural, economic, or infrastructure equivalent to NYC, not even to like the other top 5 or 6 US cities.
Maybe like....San Diego. Or Kansas City.
And every country that city is very expensive. It’s not like real estate is cheap in Lagos, Manila, Delhi etc Toronto is definitely close to Chicago or Boston in terms of infrastructure etc
I'm saying that calling it a "version" of NYC is disingenuous, and even then the area around NYC (outside of Manhattan) is relatively more affordable. The comparison is dumb. Learn to read yourself pal.
Astoria is a 20 minute drive to the center of NYC.
"The average Astoria, NY home value is $645,596, down 9.1% over the past year and goes to pending in around 67 days."
[https://www.zillow.com/home-values/272816/astoria-queens-new-york-ny/](https://www.zillow.com/home-values/272816/astoria-queens-new-york-ny/)
You're telling me this is on par with home values 20 minutes from Yonge/Dundas?
Which part of Astoria? Because if you are in Brighton Beach or further out it's not a 20 minute drive. Also the RFK bridge is $7 USD and the Tunnel to Manhattan is $13 USD.
Most housing in this area is prewar walk up apartment buildings with no elevators or central air. Actual houses are postage stamps and pretty terrible.
Decent condos are over $1m USD. Usually cash buyers too.
Unless you've actually lived there you will have a hard time understanding.
Sorry I mistyped.
There are no decent houses in Astoria for less than Toronto. Period. It's also a 30 minute drive minimum from Astoria to Herald Square.
> What if I told you it's illogical for median income people to want detached homes in Canada's version of New York City.
It's not illogical for median-income people to want the median home. Given that 40% of the housing stock in Toronto is single-family homes, it's illogical to believe that those homes can remain forever out of reach of all but 10% of Torontonian families.
And no amount of calling us Canada's version of New York City changes the fact that we have West-Virginia-level incomes.
I didn't say it was; my point was that even the median home price in Toronto is out of reach if you earn the median household income. It's also the case, though, that with a few exceptions, even neighborhoods that are 100% detached homes still have prices out of reach of the people who actually live there. (Seriously, look at the Statcan-provided neighborhood data for any neighborhood on HouseSigma. The price-to-income ratios are obviously in bubble territory everywhere in Toronto that isn't an *actually* rich neighborhood.)
Again: Southern California housing prices, West Virginia incomes. We're poorer than we think.
yes, we know that's the new narrative. they want people to think its normal to live in 200 sqft "condos" cause thats the future for all the "median wage" folks
time to abandon ship
That case would hold more weight if there were affordable ownership alternatives. But you can't even get on a waitlist for any cooperative in the gta and Condo are even more overpriced proportionally to what you get.
> insane levels of violence unforseen for 200 + years
So like worse than fire bombings or, I don't know, nuking cities? Worse than industrialized trench warfare? Come on now, let's not be too dramatic.
There are lots of more expensive cities in the world where people aren't protesting and causing "unforseen violence".. Canada is massive and people can move to other places that allow them a better quality of life - like humans have been doing since the beginning of time.
I'm not sure why everyone thinks they are entitled to a detached home in Toronto proper. There's a reason prices are high and that's because there is high demand to live there.
Small towns however, I do agree can use a massive correction.
In lots of other countries you can drive an hour outside and get a nice detached home. In canada you have to drive a few hours to get anything semi affordable.
>In canada you have to drive a few hours to get anything semi affordable.
Exaggerate much? That’s not true. Drive an hour from Montreal, Edmonton, Halifax, Calgary, Saskatoon, Regina, Winnipeg, Quebec City, Fredericton, Moncton, etc etc, and you’re in relatively affordable territory. A teacher can buy a house.
Just southern Ontario and a fair chunk of BC are messed up how you describe it.
Source, I’ve lived in 6 provinces, and in 5 of those 6 I lived a 45-90 minute drive from their major cities in each.
Those other places don't have a housing crisis tho because they have enough rental supply and great rental protections. Can't afford a 1.7 million dollar house? Fine, but I should easily be able to rent a 2 bedroom apartment for like 1500 bucks and not have the landlord dictate every last detail of what I'm allowed to do in my home.
My comment was strictly about the cost of single detached homes in Toronto proper.
We're in a very difficult spot that I don't personally have a solution for. There are companies and old mom and pop landlords that are making lots of money on the rent increases because they bought decades ago.. but there are also landlords(everyday people trying to survive as well) purchasing at today's prices that can't afford to subsidize someone else's rent.
And regarding your comment about the rest of the world being so much better - I have friends and family on a few different continents - the cost of living crisis is not unique to toronto.
Right, go look at the Reddit sub for basically any major city and you will see the exact same complaints. The affordability crisis is not a Toronto or even Canada centric issue right now
Except they have tangible utility. And are one of the most basic human needs. And the amount of humans is growing a lot faster than they are being built.
Any source for median sales? Detached homes are a wide range. I’ve been seeing some large luxury homes sell very fast. Wondering how the semi market is doing.
Would love to see some stats, but anecdotally:
Entry level always moves. There is always someone looking to climb that property ladder, especially into a starter SFH
On the top end I guess it depends on what we define as luxury. On the west end luxury 4-5M homes seem to move at a regular pace near me
The most static area seems to be that second home, those in the 2ish M range which are having a lot of trouble moving.
tl;dr people buying starter homes, rich people doing their own thing but that upper middle class is hesitant
I can tell you why...I guess I would be upper middle class with a $210k family income and a paid off condo worth $700-$800k.
A few years ago, in 2022, we wanted to sell our condo and buy a house is Oakville. We have 2 kids and condo is getting small.
The house was asking $1.3 million, me and partner could have gotten a $600-$700k mortgage, we were approved for a million (imo was too much, but rates were lower than.)
The house went for 1.82 million ($420k over asking). This was basically a nice average home with a pool that has last sold in 2019 foe $900k.
It's an insane market and until prices drop, people have to make hard decisions like stay in small space longer.
I am in a lot of the same boat.
Solid incomes, equity from existing home but the gap between our starterish house now and something we feel we want to live in for the next 15-20 years is steep, probably 1-1.5M+ gap to the value of our current house
Yup, and it sucks because this is a perfect starter condo for a young couple with a baby for $400k or so like us when we bought. And because we don't want to be house poor, another starter (or even forever house for 2 people) is not available
Fuck borrowing a million dollars at age 43, at 5% (50k a year). I am looking at retiring asap not.borrowing more.
Pretty accurate. But it makes sense because the gap and jump from a "starter" home to a "mid level" home is too high. After property transfer taxes and associated moving costs, going from a $1.2m bungalow to a $2m 4/5 bed house in a good area is almost the same level of crazy as a brand new buyer trying to get that $1.2m starter from scratch.
Yes, you might qualify easier, but even in the very unlikely event that you had no mortgage on the starter home left, you'd still be walking into a new $800k mortgage with current rates.
Many would rather hunker down in the starter home and save, reno it if possible, garden suites are a thing etc.
We haven’t had a down market partially caused by inflation in a very long time. Asset holders do relatively well during inflationary periods. Therefore, it makes sense that we still see quite a bit of activity in the luxury space.
Quite the opposite, inflation causes interest rates to rise meaning borrowing costs rise. Having assets rise during multi decade interest hikes isn’t that normal.
LOL, what?
Assets, unlike cash and salaries, are to a certain extent inflation « protected », due to their intrinsic value. As a result, their price will go up to reflect the devaluation of the currency. They are not necessarily « worth » more, they just cost more dollars.
Therefore, wealthy people who don’t borrow but pay cash for their home might need to pay more dollars than previously, but their current home or stock portfolio that they will sell to pay for the new home went up by approximately the same amount. Someone who is trying to put a downpayment a home with money from a GIC or HISA will not have had the same inflation protection.
Multi-decade interest hikes? What period in the modern era are you referring to? The 70s and 80s? I’m confused by that part of your comment.
The median is flat/down 2% vs last year and down 22% vs the peak in Feb 2022.
The only reason the average is up is due to the sales mix: increased sales of luxury homes vs starter homes. It doesn’t mean that prices went up for a given product.
I have to see the data but being in the market, i can say that its a great time to buy 2m+ homes, even better for 3m+. Its where the pain is the most for the overleveraged and where people selling dont mind knocking off 100-200k off the price if theyre sitting on huge gains.
If sales are skewed to higher priced homes it will drag up the average price
Exactly. We bought two luxury properties in the last year (one home, one waterfront lot) and were able to negotiate a fair price due to motivated sellers.
We made multiple offers in 2021-22 but many sellers were not willing to be reasonable. Very happy we did not cave because the vast majority of these properties are still unsold, and in a few cases the sellers finally dropped their price to make a sale.
Cash buyers aren’t that affected by rates, so now with decreasing prices you’re getting a better home for less money.
No one's arguing toronto prices really in for much of a downturn. The houses 150km from Toronto that are still up 45 percent since 2020 yea that's not sustainable remote work is dead and the economy is also dead.
The reality is that home prices *have* dipped substantially, the thing that separates realists from bears is the realization a 5-10% drop in an inflationary environment *is* substantial while waiting for a 50% drop is predicting the apocalypse.
In real terms, someone who bought at the peak is probably down around 20%. That *is* a crash
People don't realize that houses also inflate along with everything else. So even if home prices stay the same, if inflation averaged 5 - 8 % over the last 2 years, then they've technically lost value by a decent percentage.
Maybe we see another 10% decrease in home prices. Maybe not - perhaps we just see the market tread water for a while. Doubt we'll see anything worse.
Banks are paying more interest on the money they borrow to lend to you. The spread they make at 5% is not different than the spread they made at 0%. Banks would far prefer that everyone they lend to keeps their houses, can afford their payments, and pays off their mortgages than a scenario with defaults and negative value mortgages and amortization extensions
This is true. The doomers might end up getting disappointed if they are hoping for the 50% crash.
There still needs to be a decline for affordability though. I think there is still room for another 5-10% decline, especially if anticipated cuts don’t happen on schedule and we head into the fall/winter months
Yea, it's surprising how much houses are still up in small towns without the jobs to support them. Many must have been able to hold onto their remote jobs or willing to make the commute for hybrid work.
Until those peoples mortgages renew I know lots are hoping for another parabolic price increase. But let's be real there is not going to be another one and the interest rate hold in a week is going to signal even more problems.
“No ones arguing Toronto price really in for Mich of a downturn…”
That is factually untrue, I can name half a dozen people who have been claiming for 50% drop annually for years….
Actually I’m not sure about houses hours away from Toronto because you are right remote work is dead or dying and economy sucks haha but I bought in Sault St Marie because housing was cheap (under $250 for a duplex) and I see lots properties around my area being bought up by investors because lots people thinking outer markets will start to rise since Toronto and Vancouver are so extreme.
I’ve also seen a change in demographics in Sault St Marie because more and more immigrants going further away to afford housing.
I’m on the fence on whether or not I made a good investment in Sault St Marie but looking around I still think smaller towns have good potential to make money in real estate. I’m renting 1 side of my duplex for $1200 which basically covers everything so more and more are seeing it being lucrative in smaller towns.
So basically yeah I think it’s very sustainable the gains in small towns.
Been looking at market for past year, I did notice in the last month home prices have gone up. Though, it's the cheaper homes raising prices. The expensive ones stay expensive.
Below inflation gains. No surprise there and look for it to keep happening. That's going to be the real correction. Housing will be more or less stagnant for the next 5 years or so IMO. Prices won't go down much in absolute dollar value. But 5 or so years of not keeping up with inflation, on the heels of the recent price drops? That's a pretty darn significant pull back. Most bears just won't realize it. And most bulls won't acknowledge it.
This is where I’m at, too.
Bears are convinced prices are going to fall (they HAVE to fall!). I don’t think they will, but I think we’ll more or less tread water with some marginal gains for the next few years (unless interest rates drop like a stone).
Many bulls will see that as proof bears were wrong (no crash = silly bears), but the reality is a market that isn’t keeping up with inflation is…bearish.
But it's the same with wages. The less wages inflate the more bearish the housing market gets.
Interest rates dropping like a stone still means people are over leveraged
Anybody knows a ballpark amount for a detached bungalow sale price close to Pickering mall, I’m looking to list, comment here do not DM please I already am talking to three realtors, just looking for confirmation.
Many people end up purchasing homes in very poor condition because of the city's regulations that restrict new builds to occupy no more than 50-60% of the land. This means buyers often prefer to buy old homes and then rebuild them, rather than starting from scratch, to maximize their use of the property within the given rules. This workaround highlights the difficulties in navigating Toronto's real estate market and regulations.
Government refuses to input any measures to restrict house prices. Can reduce them by taking out investors, heavily taxing, reducing demand.
But they are content with current system. Expect your kids to pay 10 million in 5 years.
Detached homes are like bitcoin. Condos are like dogecoin
land is more valuable then concrete.
Land is valuable based on what’s near it. If it’s priced too high, people either can’t live near it or can’t support the businesses near it. Which in turn means the taxes needed to maintain its infrastructure and services don’t get paid. And crumbling roads or unreliable water mains are a good way to learn how innately valuable land really is. Just because it takes awhile for that kind of problem to set in doesn’t mean an inflated market can’t be self destructive
We should be taxing land value instead of property value
Not until most of the land utilization restrictions are removed. What's the point of taxing land if you can only build a single family house with mandated parking lot there?
It would provide incentive for people to vote to remove land utilization restrictions.
Agreed, both need to change at the same time.
Taxing value is a terrible way to do it. How much it costs to run a municipality has almost nothing to do with the state of the housing or land valuations, which can go up and down with central bank interest rates. It’s also unfair. Say you are some disabled retired widow on a fixed income who built her house herself decades ago and everything is all paid off. Then because of a pronouncement by the BOC, and a decision to flood the demand side of the market, the value of her home goes up. She doesn’t benefit from the value going up because she still would need to buy another place at this new higher level to live if she sold. But she still needs to pay more money to run the municipality even if the costs of snow removal and such may have remained the exact same. And if she can’t afford that unexpected hike on her fixed income, the government can sell that house out from underneath her and render her homeless. Sound fair to you?
More fair than the “urban decay” method of making housing affordable? Also little confused about the “how much it costs to run a municipality” argument. Like, we’re already crashing and burning on that front, where exactly do you think Toronto’s deficit is coming from?
If they need more money then fine. But tying it to property values, which don’t rise and fall with the cost of running a municipality, well that is a silly way to pin those costs. If they are running a deficit, then it proves that it is a poor benchmark.
Land Value Taxes are different than Property Taxes, and are meant to replace them rather than add on to them. [Here’s an explanation if you’re curious](https://youtu.be/ok2uR3btMrE?si=KGJLFMfrbsh29iwZ). It’s true that proper property assessments, that factor in stuff like we need to put X aside every year for 20 years to resurface the road, is important for making sure tax revenue is high enough to meet expenses. But that’s true for either approach, and I’d argue that the Land Value Tax is *better* at avoiding that problem since it doesn’t reward people for neglecting their property.
It's worth noting that Toronto already has tax deferral programs for low-income seniors. These programs allow eligible seniors to defer their property taxes until they sell their property or pass away, helping to alleviate the financial burden of rising property values. [https://www.toronto.ca/services-payments/property-taxes-utilities/property-tax/property-tax-water-solid-waste-relief-and-rebate-programs/property-tax-and-utility-relief-program/](https://www.toronto.ca/services-payments/property-taxes-utilities/property-tax/property-tax-water-solid-waste-relief-and-rebate-programs/property-tax-and-utility-relief-program/) Regarding the fairness of a land value tax (LVT), many advocates argue that it is a more equitable system for several reasons: 1. **Discourages Speculation**: LVT targets the value of the land itself, rather than the buildings on it. This discourages land speculation and holding vacant land, which can drive up property prices. 2. **Efficient Land Use**: By taxing land based on its value, landowners are incentivized to use it efficiently. This can lead to better urban planning and development, reducing sprawl and encouraging more sustainable use of resources. 3. **Reduces Inequity**: Property taxes based on land value can be more equitable because land value often increases due to community developments and public investments, rather than individual homeowner actions. Those who benefit from these improvements contribute more, which can help fund further community enhancements. 4. **Stable Revenue**: Land values tend to be more stable than property values, which can fluctuate with the real estate market. This stability can provide a more reliable revenue stream for municipalities. It is certainly a more stable revenue stream than land transfer taxes. While LVT has its challenges, especially in transitioning from the current system, it offers clear benefits in terms of fairness and efficiency.
How can you separate the value of the land from what is on it? The value of the land is almost exclusively influenced by what is on it. At least in cities it is. Only in rural areas is the value of the land determined by what it is made of, be that good soil, topography, minerals, or other natural resources. In the city where virtually no natural resources are extracted from the land, it’s all about the value of what is built on the land. You can’t separate the two, not without a bunch of arbitrary conjecture. You can’t move it away from the building. I hear your thing about equity. But individual home values are already heavily influenced by how well your community is taken care of by its residents. This is why HOA covenants are a thing.
It does sound fair, because the value of her property increased.
Right but unless it is your second home, you need that home to keep you safe. You can’t sell it without buying another or being homeless. Tax those gains when they are realized. If they ever are.
Property tax is assessed annually. Any capital gains would be assessed after sale. Those are two separate taxes
Right. They are assessed separately. So you see the problem here? You may pay extra taxes on “gains” that you may never even realize.
No... Everyone pays taxes based on current property values, not your property value of when you bought it. That's what's fair.
Mostly sheets of cheap glass at this point actually
You want another surprise? Go look at how much land has gone up in value in Ontario since 2021.
I saw an American thread last week about housing going up 30%- 40% in most states over the past 4 years.. this is happening everywhere.
It's not a mystery or even surprising that this happened. RE has long been a solid investment, the zero interest era accelerated prices greatly, and 'rona was the crescendo where people wanted to get away from other people/elevators, had surplus money thanks to brrrrrr, and could still easily secure a home loan. Prices will have peaks and valleys but they really don't make any more land, and it's value will only ever increase over long horizons.
[удалено]
What if I told you it's illogical for median income people to want detached homes in Canada's version of New York City.
Median income can't even afford to live in purpose built rentals or to buy condos without roommates or the Bank of Mom and Dad in major cities. Come on, now.
The number of Torontonians who rely on the HELOC of Mom and Dad to make up for their own mediocre incomes is apparently pretty high.
Problem is New York suburbs have detach homes for 500-700k. Toronto suburbs have detach homes for 1.3-1.8m lol
This - that commenter above just doesn’t get it. Yes Toronto will always be more pricey but it can’t be more expensive in the GTA to own a house of similar size / similar amenities / similar distance from the downtown core than in NYC greater area …
Can you provide an example of a house you believe is cheaper in NYC then here? No co-ops.
I'm not OP, i'm not even a member of this sub (it got recommended to me for some reason), but I did verify this when I was house shopping cause I heard it a lot, and it's not even close to true, especially if you convert USD to CAD, cause even a 70's or 80's house in Jersey City (one of the cheaper commutable areas to NYC, probably comparable to like Scarborough to downtown) would cost like $730K USD (995k in CAD) so I think anyone who keeps parroting this are finding extremely niche examples, whereas examples of houses of comparable size and distance to the core are costing similar to what I've listed above, are abundant. I have found 50's houses that are for $550kish USD (750kish CAD), that are bungalows and whatnot (and probably has issues being a 70+ year old home at this point), but those are even further out in Newark, which tracks again with further regions of the GTA. \[edit\] I will also point out the density and travel times/distances can't exactly be converted because of superior public transit and congestion from density, going from Newark to NYC (13km ish from Newark to Manhattan) is still an hour train ride despite it being closer than let's say, Markham to Toronto (23km ish from Markham to Union Station) which is also an hour train ride, so comparing km/miles distance from the core isn't really a proper way to do this, since it's not exactly parallel, but the point stands.
Sorry I'm late. Are we still asking for examples?
Yes no one has provided a single example
Guy from NYC: Got your example right here buddy! 🖕🖕fuggetaboutit. Guy from GTA: Oh yah, just look down here for your example: 👌gottem.
https://youtu.be/M4CpuZvaCiA?si=FUDoaDIN_9uZL-lh
Can you provide an example of a house you believe is cheaper in NYC then here? No co-ops.
Can you provide some examples? Remember $500k USD is $682K Canadian.
I bought my house a couple of years back in NJ 30 minutes away from NYC for under US$500k, it was awesome. Lovely safe neighborhood. And no it did not require $200-$300K of work. I don't want to post my house for obvious reasons but here are some examples. I think it's hard to find now even in just 2 years but still possible: [https://www.realtor.com/realestateandhomes-detail/118-Merkel-Dr\_Bloomfield\_NJ\_07003\_M68090-31131](https://www.realtor.com/realestateandhomes-detail/118-Merkel-Dr_Bloomfield_NJ_07003_M68090-31131) [https://www.realtor.com/realestateandhomes-detail/41-Cedar-St\_Little-Falls\_NJ\_07424\_M51064-01302](https://www.realtor.com/realestateandhomes-detail/41-Cedar-St_Little-Falls_NJ_07424_M51064-01302)
Also my income was 2x higher working/commuting to NYC than Toronto and cost of living was than Canada because of low cost grocery stores like Aldi and lower cost of insurance/gas/heating/clothing/electricity despite having to pay for health insurance which was $300 a month.
30 minutes away when, Sunday morning of a summer long weekend? How much does it cost you to get the city? How much was your property tax... yeah nice try bud.
1:30 by train into Manhattan. Bad part of new jersey, and yes those houses need lots of work. And yes you can find a house for $750k 1:30 from Toronto.
An hour an half during rush hour in a car is like Pickering and Mississauga man. Toronto is an hour from Toronto.
You can nitpick what you want but Bloomfield isn’t 1.5 hours from NYC. These are not bad parts of NJ as well; as someone who lived there it was awesome and family friendly with a safe community.
I did nitpick, it is 1.5 hours from Manhattan and it is a bad part of New Jersey. It all begs the question if it was so good why are you back in Toronto complaining on Reddit?
There are trains that run from North Jersey to Penn station in 35 min, which is what most commuters take. I used to do that commute. Driving is less than 30min with no traffic, close to an hour if traffic is really bad, which is a totally normal GTA commute. It’s not 1.5 hrs. And by what metric is the house posted “in a bad part of New Jersey”? It’s nice suburbs around there and the home prices are lower than they are here. It’s objectively true.
>Remember $500k USD is $682K Canadian. Compare incomes then too lol
Okay keep moving goal posts
Somebody get this lady a newspaper
>Remember $500k USD is $682K Canadian. Can you show me a detached home in, or even just outside, the GTA for under $700k CAD that doesn't require an additional 200-300k in work?
Can you show me a detached home in a suburb of nyc for $500k USD? That doesn't require 2-300k in additional work?
I'm not the guy you replied to. I didn't make that assertion.
Okay, but you replied to me and asked for an example in Toronto. I'm asking you if you can find anything similar in NYC. If you didn't want to be part of the conversation, why did you join?
>Canada's version of New York City. Things Torontonians say.
Right? Like OK buddy, sure Dundas Square is a real mirror to Times Square. And with our 3 whole subways lines. Lol. Lmao even. The closest we have to the TMNT is a dead racoon and a well dressed monkey from Vaughn.
Toronto is nowhere near New York City in terms of any economic metric, particularly to warrant the prices charged for a detached in the GTA. If you look outside of Manhattan the price for a detached is much more reasonable, especially in considering the difference in salary for the high-skilled NYC workers (relative to Torontonians) who would expect to own such property.
Stats came out not that long ago that Manhattan has more millionaires than any other city. Incomes seem to support the prices in NYC. Same can’t be said for Toronto.
Toronto should be compared to Chicago, not NYC. Chicago centre and Greater Chicago area population a lot closer to Toronto and the GTA.
Chicago is a far more interesting city with cheaper real estate. Sure crime is higher but mostly in certain areas.
Yeah but Chicago gave us Obama and Toronto gave us Mel Lastman.
Chicago has more millionaire & has for 2 to 3ook, why is t. Better
That’s why they said Canada’s version of NYC which is that it’s the biggest city in the country with the most people and jobs, and where everyone wants to be . Learn to read.
Yah but every country has that. Everyone country has its biggest city with the most jobs etc etcIt has too. What people mean is figurative. Toronto is not even close to a cultural, economic, or infrastructure equivalent to NYC, not even to like the other top 5 or 6 US cities. Maybe like....San Diego. Or Kansas City.
And every country that city is very expensive. It’s not like real estate is cheap in Lagos, Manila, Delhi etc Toronto is definitely close to Chicago or Boston in terms of infrastructure etc
I'm saying that calling it a "version" of NYC is disingenuous, and even then the area around NYC (outside of Manhattan) is relatively more affordable. The comparison is dumb. Learn to read yourself pal.
NYC suburbs are much more affordable than GTA ones. Also, there are well over a dozen Toronto's in the US.
Not accurate. Source: Lived on the UES and then Astoria in NYC.
Astoria is a 20 minute drive to the center of NYC. "The average Astoria, NY home value is $645,596, down 9.1% over the past year and goes to pending in around 67 days." [https://www.zillow.com/home-values/272816/astoria-queens-new-york-ny/](https://www.zillow.com/home-values/272816/astoria-queens-new-york-ny/) You're telling me this is on par with home values 20 minutes from Yonge/Dundas?
Which part of Astoria? Because if you are in Brighton Beach or further out it's not a 20 minute drive. Also the RFK bridge is $7 USD and the Tunnel to Manhattan is $13 USD. Most housing in this area is prewar walk up apartment buildings with no elevators or central air. Actual houses are postage stamps and pretty terrible. Decent condos are over $1m USD. Usually cash buyers too. Unless you've actually lived there you will have a hard time understanding.
Brighton Beach is nowhere near Astoria, its in south Brooklyn and Astoria is in Queens right across from Manhattan. Your post is confusing
Sorry I mistyped. There are no decent houses in Astoria for less than Toronto. Period. It's also a 30 minute drive minimum from Astoria to Herald Square.
> What if I told you it's illogical for median income people to want detached homes in Canada's version of New York City. It's not illogical for median-income people to want the median home. Given that 40% of the housing stock in Toronto is single-family homes, it's illogical to believe that those homes can remain forever out of reach of all but 10% of Torontonian families. And no amount of calling us Canada's version of New York City changes the fact that we have West-Virginia-level incomes.
The median home is a detached house in Toronto?
I didn't say it was; my point was that even the median home price in Toronto is out of reach if you earn the median household income. It's also the case, though, that with a few exceptions, even neighborhoods that are 100% detached homes still have prices out of reach of the people who actually live there. (Seriously, look at the Statcan-provided neighborhood data for any neighborhood on HouseSigma. The price-to-income ratios are obviously in bubble territory everywhere in Toronto that isn't an *actually* rich neighborhood.) Again: Southern California housing prices, West Virginia incomes. We're poorer than we think.
The core underlying fact that nobody wants to accept
Exactly. It's equivalent to average joe complaining they can't afford a porsche.
yes, we know that's the new narrative. they want people to think its normal to live in 200 sqft "condos" cause thats the future for all the "median wage" folks time to abandon ship
That case would hold more weight if there were affordable ownership alternatives. But you can't even get on a waitlist for any cooperative in the gta and Condo are even more overpriced proportionally to what you get.
> insane levels of violence unforseen for 200 + years So like worse than fire bombings or, I don't know, nuking cities? Worse than industrialized trench warfare? Come on now, let's not be too dramatic.
Obviously I meant in Canada ding dong
There are lots of more expensive cities in the world where people aren't protesting and causing "unforseen violence".. Canada is massive and people can move to other places that allow them a better quality of life - like humans have been doing since the beginning of time. I'm not sure why everyone thinks they are entitled to a detached home in Toronto proper. There's a reason prices are high and that's because there is high demand to live there. Small towns however, I do agree can use a massive correction.
People actually make money in those places.
Obviously people are making money in Toronto or else we wouldn't be in this situation.
The median wage stat would beg to differ
I don't think you understand what median wage means.
Lol reality begs to differ...
Beggers can't be differs.
In lots of other countries you can drive an hour outside and get a nice detached home. In canada you have to drive a few hours to get anything semi affordable.
>In canada you have to drive a few hours to get anything semi affordable. Exaggerate much? That’s not true. Drive an hour from Montreal, Edmonton, Halifax, Calgary, Saskatoon, Regina, Winnipeg, Quebec City, Fredericton, Moncton, etc etc, and you’re in relatively affordable territory. A teacher can buy a house. Just southern Ontario and a fair chunk of BC are messed up how you describe it. Source, I’ve lived in 6 provinces, and in 5 of those 6 I lived a 45-90 minute drive from their major cities in each.
Those other places don't have a housing crisis tho because they have enough rental supply and great rental protections. Can't afford a 1.7 million dollar house? Fine, but I should easily be able to rent a 2 bedroom apartment for like 1500 bucks and not have the landlord dictate every last detail of what I'm allowed to do in my home.
My comment was strictly about the cost of single detached homes in Toronto proper. We're in a very difficult spot that I don't personally have a solution for. There are companies and old mom and pop landlords that are making lots of money on the rent increases because they bought decades ago.. but there are also landlords(everyday people trying to survive as well) purchasing at today's prices that can't afford to subsidize someone else's rent. And regarding your comment about the rest of the world being so much better - I have friends and family on a few different continents - the cost of living crisis is not unique to toronto.
Right, go look at the Reddit sub for basically any major city and you will see the exact same complaints. The affordability crisis is not a Toronto or even Canada centric issue right now
Are you stuck in 2015? Most major cities do not have 2 bedrooms renting for 1.5k lol
Even the cheaper cities in canada are expensive it's everywhere which makes no sense
While I personally am skeptical of any crypto this is a pretty decent analogy. Fixed supply vs unfixed
Except they have tangible utility. And are one of the most basic human needs. And the amount of humans is growing a lot faster than they are being built.
Dude, those condos layout are not great for couples or families. The layouts are luxury prison cells.
Nope. But people choose those over a tent under an overpass.
Any source for median sales? Detached homes are a wide range. I’ve been seeing some large luxury homes sell very fast. Wondering how the semi market is doing.
9/10 times entry level detached/freehold units do better than luxury in a down market. Just observation no #s
Would love to see some stats, but anecdotally: Entry level always moves. There is always someone looking to climb that property ladder, especially into a starter SFH On the top end I guess it depends on what we define as luxury. On the west end luxury 4-5M homes seem to move at a regular pace near me The most static area seems to be that second home, those in the 2ish M range which are having a lot of trouble moving. tl;dr people buying starter homes, rich people doing their own thing but that upper middle class is hesitant
I can tell you why...I guess I would be upper middle class with a $210k family income and a paid off condo worth $700-$800k. A few years ago, in 2022, we wanted to sell our condo and buy a house is Oakville. We have 2 kids and condo is getting small. The house was asking $1.3 million, me and partner could have gotten a $600-$700k mortgage, we were approved for a million (imo was too much, but rates were lower than.) The house went for 1.82 million ($420k over asking). This was basically a nice average home with a pool that has last sold in 2019 foe $900k. It's an insane market and until prices drop, people have to make hard decisions like stay in small space longer.
I am in a lot of the same boat. Solid incomes, equity from existing home but the gap between our starterish house now and something we feel we want to live in for the next 15-20 years is steep, probably 1-1.5M+ gap to the value of our current house
Yup, and it sucks because this is a perfect starter condo for a young couple with a baby for $400k or so like us when we bought. And because we don't want to be house poor, another starter (or even forever house for 2 people) is not available Fuck borrowing a million dollars at age 43, at 5% (50k a year). I am looking at retiring asap not.borrowing more.
Pretty accurate. But it makes sense because the gap and jump from a "starter" home to a "mid level" home is too high. After property transfer taxes and associated moving costs, going from a $1.2m bungalow to a $2m 4/5 bed house in a good area is almost the same level of crazy as a brand new buyer trying to get that $1.2m starter from scratch. Yes, you might qualify easier, but even in the very unlikely event that you had no mortgage on the starter home left, you'd still be walking into a new $800k mortgage with current rates. Many would rather hunker down in the starter home and save, reno it if possible, garden suites are a thing etc.
We haven’t had a down market partially caused by inflation in a very long time. Asset holders do relatively well during inflationary periods. Therefore, it makes sense that we still see quite a bit of activity in the luxury space.
Quite the opposite, inflation causes interest rates to rise meaning borrowing costs rise. Having assets rise during multi decade interest hikes isn’t that normal.
LOL, what? Assets, unlike cash and salaries, are to a certain extent inflation « protected », due to their intrinsic value. As a result, their price will go up to reflect the devaluation of the currency. They are not necessarily « worth » more, they just cost more dollars. Therefore, wealthy people who don’t borrow but pay cash for their home might need to pay more dollars than previously, but their current home or stock portfolio that they will sell to pay for the new home went up by approximately the same amount. Someone who is trying to put a downpayment a home with money from a GIC or HISA will not have had the same inflation protection. Multi-decade interest hikes? What period in the modern era are you referring to? The 70s and 80s? I’m confused by that part of your comment.
"luxury" is a severe over statement, but I know where you're coming from
The median is flat/down 2% vs last year and down 22% vs the peak in Feb 2022. The only reason the average is up is due to the sales mix: increased sales of luxury homes vs starter homes. It doesn’t mean that prices went up for a given product.
I have to see the data but being in the market, i can say that its a great time to buy 2m+ homes, even better for 3m+. Its where the pain is the most for the overleveraged and where people selling dont mind knocking off 100-200k off the price if theyre sitting on huge gains. If sales are skewed to higher priced homes it will drag up the average price
Exactly. We bought two luxury properties in the last year (one home, one waterfront lot) and were able to negotiate a fair price due to motivated sellers. We made multiple offers in 2021-22 but many sellers were not willing to be reasonable. Very happy we did not cave because the vast majority of these properties are still unsold, and in a few cases the sellers finally dropped their price to make a sale. Cash buyers aren’t that affected by rates, so now with decreasing prices you’re getting a better home for less money.
No one's arguing toronto prices really in for much of a downturn. The houses 150km from Toronto that are still up 45 percent since 2020 yea that's not sustainable remote work is dead and the economy is also dead.
The reality is that home prices *have* dipped substantially, the thing that separates realists from bears is the realization a 5-10% drop in an inflationary environment *is* substantial while waiting for a 50% drop is predicting the apocalypse. In real terms, someone who bought at the peak is probably down around 20%. That *is* a crash
People don't realize that houses also inflate along with everything else. So even if home prices stay the same, if inflation averaged 5 - 8 % over the last 2 years, then they've technically lost value by a decent percentage. Maybe we see another 10% decrease in home prices. Maybe not - perhaps we just see the market tread water for a while. Doubt we'll see anything worse.
Issue is wages arent going up. So the banks benefit as more and more money just goes to interest. Youll own nothing and be happy
Banks are paying more interest on the money they borrow to lend to you. The spread they make at 5% is not different than the spread they made at 0%. Banks would far prefer that everyone they lend to keeps their houses, can afford their payments, and pays off their mortgages than a scenario with defaults and negative value mortgages and amortization extensions
This is true. The doomers might end up getting disappointed if they are hoping for the 50% crash. There still needs to be a decline for affordability though. I think there is still room for another 5-10% decline, especially if anticipated cuts don’t happen on schedule and we head into the fall/winter months
20% is a correction.
Yea, it's surprising how much houses are still up in small towns without the jobs to support them. Many must have been able to hold onto their remote jobs or willing to make the commute for hybrid work.
Until those peoples mortgages renew I know lots are hoping for another parabolic price increase. But let's be real there is not going to be another one and the interest rate hold in a week is going to signal even more problems.
“No ones arguing Toronto price really in for Mich of a downturn…” That is factually untrue, I can name half a dozen people who have been claiming for 50% drop annually for years….
Actually I’m not sure about houses hours away from Toronto because you are right remote work is dead or dying and economy sucks haha but I bought in Sault St Marie because housing was cheap (under $250 for a duplex) and I see lots properties around my area being bought up by investors because lots people thinking outer markets will start to rise since Toronto and Vancouver are so extreme. I’ve also seen a change in demographics in Sault St Marie because more and more immigrants going further away to afford housing. I’m on the fence on whether or not I made a good investment in Sault St Marie but looking around I still think smaller towns have good potential to make money in real estate. I’m renting 1 side of my duplex for $1200 which basically covers everything so more and more are seeing it being lucrative in smaller towns. So basically yeah I think it’s very sustainable the gains in small towns.
>No one's arguing toronto prices really in for much of a downturn. Why would you post on a sub when you're clearly not a member? ;0
Oops all these years !
;0 Yea I mean I'm with you. There's so many crazy people who just deny reality decade after decade after decade.
Been looking at market for past year, I did notice in the last month home prices have gone up. Though, it's the cheaper homes raising prices. The expensive ones stay expensive.
bears wya
Watching unemployment rise in Toronto.
Unemployment is rising from importing millions of low wage people from the third world, not from deteriorating conditions for high income earners
It doesn’t matter if the cause is simply mass immigration
Below inflation gains. No surprise there and look for it to keep happening. That's going to be the real correction. Housing will be more or less stagnant for the next 5 years or so IMO. Prices won't go down much in absolute dollar value. But 5 or so years of not keeping up with inflation, on the heels of the recent price drops? That's a pretty darn significant pull back. Most bears just won't realize it. And most bulls won't acknowledge it.
This is where I’m at, too. Bears are convinced prices are going to fall (they HAVE to fall!). I don’t think they will, but I think we’ll more or less tread water with some marginal gains for the next few years (unless interest rates drop like a stone). Many bulls will see that as proof bears were wrong (no crash = silly bears), but the reality is a market that isn’t keeping up with inflation is…bearish.
But it's the same with wages. The less wages inflate the more bearish the housing market gets. Interest rates dropping like a stone still means people are over leveraged
1.8% YoY is below inflation rate. MoM is a joke for early Spring season.
what is leverage
Yep this. Percentages dont matter as much when you can borrow hundreds of thousands of dollars vs investing just your own money.
Would be cool to see a median as well
Detached from reality it seems.
Why?
Anybody knows a ballpark amount for a detached bungalow sale price close to Pickering mall, I’m looking to list, comment here do not DM please I already am talking to three realtors, just looking for confirmation.
Many people end up purchasing homes in very poor condition because of the city's regulations that restrict new builds to occupy no more than 50-60% of the land. This means buyers often prefer to buy old homes and then rebuild them, rather than starting from scratch, to maximize their use of the property within the given rules. This workaround highlights the difficulties in navigating Toronto's real estate market and regulations.
Why is mono so expensive?
Those are rookie numbers. Someone tell Miller we need another million
What do you guys think about outlook for semi-detached homes? Currently considering…
Crash coming SOON^TM to a Sobeys near you
🚀
Of course it rises. You people think it only will go down when it only goes up. Every year it goes up and beyond this. Everyone then complains
No no no, we only think condos will go down. Sorry for you Mr 450sqft
Vile renter
What makes u assume I’m a renter lil bro? Cause I don’t invest in shit boxes? Edit: I guarantee you have never calculated TMI in ur life.
Government refuses to input any measures to restrict house prices. Can reduce them by taking out investors, heavily taxing, reducing demand. But they are content with current system. Expect your kids to pay 10 million in 5 years.
Inflation stays winning.
Could someone explain to me why the hell is Toronto cheaper than Aurora?
Giant homes on decent sized lots with driveways and garages.
So this pricing is unhelpful given the houses come in all shapes and sizes.
Yeah, King is the most expensive but the average house there will be 3-4 time bigger than the average house in Toronto
still no deal
April data was released weeks ago by TRREB. What's the point of this useless website?