The measures announced by the government to curb the rising house prices in the Greater Toronto Area will have more “meaningful impact” than those already implemented in Vancouver.
That’s the view of ratings agency Fitch which believes that policies including a tax on foreign buyers, rent controls and other proposed measures, are likely to lead to a correction in prices and slowing of sales activity.
It highlights a 3 per cent drop in Vancouver house prices following the introduction of a 15 per cent tax on foreign buyers last
August without the rent controls proposed for the GTA. Prices have since rebounded to near-peak.
Fitch says that rent controls will restrict the ability of investor-landlords to increase rents which should dampen price growth in the condo market as some highly-leveraged investors are forced to sell, and speculators may follow suit.
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