Province’s fall economic statement

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The provincial government says it’s on pace to get back in the black by the end of next fiscal year. The Liberals gave us an economic update today announcing a change that they believe will help first time home buyers enter the market.

Finance Minister Charles Sousa repeated his 2016 budget promise to wipe out it’s $4.3 billion deficit by 2017-2018 by selling off Hydro One, LCBO office buildings and dipping into the province’s rainy day fund. But according to the Financial Accountability office of Ontario, as read by finance critic Vic Fedeli, this is not a sound strategy of managing Ontario’s books.

“The Liberal government is using one time money from asset sales and contingency funds to artificially balance the budget.”

While that take isn’t new, Sousa did double the land transfer tax rebate for first time homebuyers from $2000-$4000.

The Liberals will balance the loss tax-revenue by increasing property taxes for homes $2 million plus to 2.5% with detached homes in Toronto selling for about $1.3 million on average, this benefit would be felt by entering the market elsewhere.

“If you’re in the Hamilton market it’s quite possible you won’t be paying much of a land transfer tax at all because the home prices are lower.” Marvin Ryder, DeGroote School of Business.

While former MPP, now CEO of the Ontario Real Estate Association Tim Hudak thinks this the step in the right direction. “This can help a lot because folks buying their first homes don’t have that kind of money in the bank.”

Vic Fedeli says this is just another case of Liberal distraction from some real problems. Sousa also mentioned that the Liberals will freeze property taxes on apartment buildings to see how that affects the affordability of the rental market on low-income earners. Sousa says property taxes on apartments tend to be double, even triple that of condominiums.