Thinking Beyond the Purchase Price – Property Taxes Updated
About 18 months ago, we compared property taxes in Toronto to that of other North American and Greater Toronto Area municipalities, so it’s about time to update you with 2015 numbers. Again with the property taxes! I get it, not all home owners are as interested in property taxes as I am. But, second to mortgage interest, they are one of your biggest annual expenses as a home owner, not to mention that you will continue to pay property taxes long after your mortgage is paid off.
Toronto continues to have the lowest Property Taxes in the GTA at 0.705%. Rounding out the top 3 is Milton at 0.757% and Markham at 0.806%. With a lower population and lower assessed house values, municipalities in Durham continue to have the highest rates with Oshawa and Clarington leading the pack at 1.57% and 1.34%, respectively. While Toronto is the only municipality currently levying a Land Transfer Tax on Home Buyers (accounting for approximately 2% of Toronto’s total revenue stream with property tax accounting for around 40%), other municipalities may soon have the ability to follow Toronto’s lead as the province is moving towards allowing all Ontario municipalities to levy a land transfer tax if desired.
Home Buyers should give close consideration to all costs when valuing a house: required maintenance, heat, hydro, water, and property tax are all factors that impact the cost of your home in the short and long term. Home Buyers choosing to buy in Oshawa instead of Toronto will save on the purchase price, but will pay more than twice as much in property tax. For a $600,000 home, this would mean an extra $430/month. Combine that with the additional commuting cost you might incur and Toronto doesn’t seem as outrageous as you originally thought.
See below for a list of North American and GTA Property Tax rates and anticipated annual costs for properties between $300,000-$900,000.
2015 Residential Property Taxes
|North American Cities|
Greater Toronto Area
*Ottawa Tax rates can vary by area and services provided. Above is an estimate for a Full Service Transit Property.
**The Average City of Chicago Homeowners are subject to a Homeower Exemption which reduces the assessment value of the home. An average exemption has been included when calculating the estimate property taxes at various prices. This information was obtain from Cook County Assessor.
***New York Tax Relief Exemptions exist based on Income, Age, Primary Residence and Veteran Status. In New York, Assessed Value cannot increase more than 6 percent each year or more than 20 percent in five years.