With the new 15% tax on overseas property investors cooling the Vancouver property market, Toronto is fast playing catch up as Canada’s hottest property region.

Over recent years Vancouver has been one of the booming property markets in the world. So much so that the British Columbia government implemented an extra 15% tax on foreign buyers in Metro Vancouver from last August in an attempt to bring the market under control.

In the year leading up to the August tax introduction in Vancouver average property prices rose by an incredible 32.6 per cent, vastly overshadowing the excellent 16.6% growth seen in the next hottest Canadian city of Toronto in Ontario.

Whilst the foreign buyer tax has worked to put the brakes on the Vancouver property boom, Toronto seems to be taking over the mantle as property hotspot, having confirmed that they will not follow the lead of its Canadian neighbour.

Ontario Premier Kathleen Wynne confirmed in October that the province will not follow British Columbia’s move to introduce a tax on foreign homebuyers.

‘We’re not going to go down the road that British Columbia has gone down,’ Wynne said at a press conference. ‘I’m not interested in doing something that would have an unintended consequence in Ontario – something that was designed for a totally different market.’

Sales in the Greater Toronto Area climbed to 5,188 transactions in January for an 11.8 per cent gain over the same month in 2016.

Average prices for the area as a whole topped $770,000 in January, marking a 22.3 per cent increase year on year from the same month in 2016.

In suburban Toronto, the price for condos sold last month averaged near $380,000, a rise of 18.5 per cent from a year earlier, while sales volume soared 26.5 per cent.

While property values are booming, active listings have near halved since January 2016 to just over 5,000 last month.

Toronto Real Estate Board’s director of market analysis Jason Mercer commented in a recent interview: ‘We’re experiencing some of the tightest market conditions on record.’

The shortage of available property, coupled with the commitment not to tax foreign buyers means that forecasters are confident Toronto has taken over as the property hotspot of Canada for 2017. Overseas property investors interested in the Canadian lifestyle may want to take note.

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