As a result of the Toronto Vacant Home Tax, which was implemented for the first time this year, 2,100 of all housing units were found to be vacant.
According to a spokesperson for the City of Toronto, 96% of Toronto’s approximately 775,000 homeowners have filed a vacant rent return. The City of Toronto has sent vacant house tax bills at 1% of the current property value to owners of vacant houses and unreported owners (considered vacant).
Experts are of the opinion that “there are not as many vacancies as expected” regarding the results of this report.
“This low vacancy in the first year means Torontonians generally do not leave their homes unoccupied,” Professor Murtazar Haider Tedrogers told the media. In Toronto’s housing market, which needs hundreds of thousands of homes, this level of vacant housing will not improve the supply shortage.”
Toronto Metropolitan University Professor Sheris Verda also positively evaluated the system, but said, “The fact that there are few vacant houses shows that most of Toronto’s houses are ‘in-house’, whether rent is cheap or expensive. Vacant rents are just one piece of the policy puzzle to address a range of problems, and we ultimately need to build more rental housing.”
The vacancy tax was modeled after the vacancy tax introduced by Vancouver in 2017 as a measure to encourage investors to rent or sell homes that are not in use.
In 2020, there were 1,755 vacant homes in Vancouver, of which 49% were converted to occupancy the following year after the introduction of the vacant rent tax. Vacancy tax is levied on houses that are vacant for more than six months in a year, but it is mandatory to report the state of occupancy even if the house is not vacant. Cases where the landlord has died, is in a hospital or long-term care facility, is undergoing major renovations or renovations, or is in the process of legal transfer of ownership are exempt from taxation.