New homes in the GTA are subject to some of the highest government charges in North America
Toronto, Sept. 16, 2019 (GLOBE NEWSWIRE) -- The impact of all government fees, taxes and charges in the wallets of new home buyers in the Greater Toronto Area (GTA) are amongst the highest in North America according to a new report conducted by the Altus Group for the Building Industry and Land Development Association (BILD).
The report shows that these charges add $222,000 to the cost of an average new single-family home and $124,000 to the cost of an average high-rise apartment in the GTA.
"The facts demonstrate that government fees, taxes and charges play a significant role in eroding housing affordability in the GTA," said Dave Wilkes, President and CEO of BILD. "These costs are unsustainable and BILD calls on all governments to bring certainty and transparency for new home buyers," continued Wilkes.
The study examined major Canadian cities such as Ottawa, Vancouver, Montreal and Calgary, major US metropolitan areas such as San Francisco, Miami, Boston, New York City, Chicago and Houston, and compared them to various GTA municipalities. Since housing is taxed differently in the various jurisdictions, the study assessed the total tax burden, as well as development incurred charges to enable better comparisons. The study concluded that:
- For a typical single-family home (low-rise), the average total of all government fees, taxes and charges in the GTA is three times higher on a per-unit basis than it is on average in the six US metropolitan areas, and nearly double those in the other Canadian urban areas.
- For high?rise developments, the average per-unit charges in the GTA is one-and-a-half times those in the six US metropolitan areas, and roughly 30 per cent higher than in the other Canadian urban areas.
- When government-imposed charges are isolated to only include charges incurred by developers or homebuilders from municipalities (i.e. development charges which are included in the price of a home and are used to fund municipal infrastructure), the average charges in the other Canadian urban areas, outside the GTA, are roughly similar to what is imposed by governments in the US metro areas.
- For the GTA, these developer-incurred charges are double those charged in the other Canadian and US jurisdictions for low-rise and 60 per cent higher for high-rise compared to other Canadian jurisdictions. The key reason for this is that development charges are approaching $100,000 per unit in some GTA municipalities.
"The Building Industry and Land Development Association supports the concept that growth should pay for growth," said Wilkes. "But clearly the costs associated with building a sewer or adding a sidewalk cannot be that much different in Montreal, Ottawa or Calgary. GTA municipalities should not be adding disproportionate costs on new home buyers as a mechanism to keep property taxes low, especially when the infrastructure benefits all," added Wilkes.
In order to keep the dream of homeownership a reality in the GTA, all levels of government must consider the role that taxes and fees contribute to the cost of a new home.
The Comparison of Government Charges on New Homes in Major Canadian and US Metro Areas is available here.
With 1,500 member companies, BILD is the voice of the home building, land development and professional renovation industry in the Greater Toronto Area. The building and renovation industry provides $34 billion in investment value and employs 270,000 people in the region. BILD is proudly affiliated with the Ontario and Canadian Home Builders' Associations.
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For additional information or to schedule an interview, contact John Provenzano, BILD Communications and Media Relations Manager, at [email protected], (416) 617-7994.
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