Toronto Real Estate Board Finds 2% of City’s Homeowners Have Vacant Homes

Toronto Real Estate Board Finds 2% of City’s Homeowners Have A Vacant Home

A new industry survey finds that many people aren’t ashamed to admit they have a vacant home available. Commissioned by the Toronto Real Estate Board (TREB), and conducted by Ipsos, the annual survey is meant to give some insights to the industry. One of those insights is on the state of vacant homes, which increasingly became a hot button issue, since we pointed these out almost a year ago. It appears the city would see quite a bit of inventory flow if a vacancy tax was implemented.

The Survey

TREB and Ipsos conducted their third annual survey of existing homeowners. The survey consisted of 2,501 existing homeowners, of which 1,000 were from a subsample of “recent homebuyers.” That might seem like a small number if you don’t deal with statistics for a living, but it’s actually very large. No, it’s not perfect. However, this would be considered close to industry standards for surveys. Most stats about the City of Toronto will have a sample about this size.

Note regarding statistical sampling: If you’re wondering what an appropriate sample size would be according to industry, you’re looking at ~2,401. That would be calculated with Greater Toronto’s population at 5,928,000, a confidence level at 95%, and a margin of error at 2%. A confidence level is how strongly they believe it represents the accuracy of demographics (industry standard is 95%), and a 2% accuracy would be considered “accurate.” Of course, the more data you have, the more accurate it would be.

Two Percent of Existing Homeowners Have A Vacant Property

When existing homeowners were asked “do you own a second property,” the vast majority said no. Greater Toronto saw 80% of respondents say no. In second, 18% of respondents said yes they do, and it’s rented out. A further 2% said they own a second home, and admitted it’s vacant. That’s quite a bit, during a “shortage” of supply.

Source: Ipsos, TREB. Better Dwelling.

Let’s give a sense of scale for that two percent. That number is almost three times the size of the CMHC rental vacancy survey. If two percent of sales through TREB were bought and kept vacant, over the 12 months before the survey was conducted, you’re looking at ~1,857 vacant units added to the pile. The number is far from insignificant.

A Vacant Home Tax Would Free Up A Lot of Inventory

Some agents have already sent newsletters out claiming these were “probably” cottages. Although they must have missed the next question in the survey. If secondary homeowners were faced with a vacancy tax in Toronto, what would these secondary unit owners do? 25% said they would not be impacted, so their units might be tenanted or located out of the city. Another 27% said they would sell their investment property. The remaining 36% said they would rent their property to tenants. Sounds like the vacancy tax would be incredibly effective at creating more supply.

Source: Ipsos, TREB. Better Dwelling.

The vacancy tax wouldn’t just be effective on these units, but the rest of the vacant units not owned by existing homeowners. Increasingly businesses and agents are buying blocks of condos, and selling them back to market. There’s also occasionally occupied homes, owned by those that primarily live elsewhere. Currently there’s little incentive to put these units back on the market, especially if they’re condos, which are still seeing prices climb. However, a simple tax could add much needed supply back into the market.

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  • Homes Are For People 6 years ago

    Important to remember that these are just secondary home owners in the city. People that live outside of the city, and a home in Toronto are not included. So if you live in Hamilton, and have a speculative property in the city, not counted. That’s in addition to the numbers mentioned which add wealth managers that hold these, estates, etc.

    I also imagine that a good amount of vacant home owners, could own more than one. The Ministry of Finance in Ontario said they’re finding people with 15+ units to their names.

    • bluetheimpala 6 years ago

      Cheap money is like crack, once you take that first hit you’re hooked. Imagine being one of the people who started buying a flipping in 2014…by late 2016 you’ve made so much money and pumped it back in, you seem invincible. Then there are the contractors/renovators who can add value right away on the cheap and get out. That’s what happened with the US housing crisis; it wasn’t 10 people with 10 additional properties it was 3 with 15.

      • Joe 6 years ago

        Prior to the US housing crisis (2006), you had nail technicians buying 2-3 condos in Miami, strippers buying property in Vegas, and bus drivers buying $750k homes in the San Fran Bay area. Lots of these loans were so called Nija (No Job – No Income, Liar Loans), that only worked if the values of the properties increased substantially year over year. The loans were packgized, diced and securitized as grad A++ around the world.

        The value of the properties long separated from the intrinsic value and followed the “Greater Fool Theory”… aka.. you buy on the premise there is a greater fool willing to pay more than you did down the road. The whole Toronto and Vancouver markets are predicated on prices just going up and up perpetually… until it doesn’t. I knew people who picked up $750 k homes outside of San Fran for $350. A 50% reduction is not out of bounds.

        For those who think people can just buy and do what they want, know that lots of real estate bubbles burst when the support of the community: firefighters, policemen, teachers, social workers, etc, are driven out due to salaries not keeping up in real estate and living costs, and ultimately pack up and leave. Scams always seem to end when buyers, esp city employees, can no longer be found.

        We have passed that point. This is going to be a big correction.

        Bluetheimpala, you have some of the best comments on here.

  • Todd J. 6 years ago

    Not sure why all of you commies need to get in everyone’s business. If I pay for a house, I should be able to use it however the hell I want. That includes me keeping it empty if I so please.

    • bluetheimpala 6 years ago

      You are very right my friend, you can do what you want with your house but you are sorely missing the point. Housing was/is manipulated to the point where it has permeated to other parts of the economy and will most likely result in some form of recession if it continues completely unabated. I pray you do not have family who bough in the last year and may be underwater for 10+ years…but as long as those commies don’t get in everyone’s business then we’re good right?

      • Yeah Right 6 years ago

        Ok so the point of government intervention is to rectify negative externalities. In the case of vacant homes in Toronto and especially Vancouver, it appears that there is a very strong argument that supports the notion that the acquisition of homes for the purpose of leaving them vacant solely for one’s self interest causes undue stress on the housing market for a significant amount of the population (renter’s, home buyers via distorted prices, lower income tax base to draw upon, disposable income taken away from consumption/investment activities that support the economy and benefits everyone diverted towards paying distorted rents benefitting only a few, etc.) and if left unresolved, the economy as a whole will suffer. Short term gains for a few should not jeopardize long term growth of an entire economy. Specifically this situation is called a pecuniary externality.

        Plain and simple, if our government leave negative externalities unchecked, then they are not doing their job. It’s their job to save us from ourselves! That being said, with large populations of renters in most urban centres, it’s probably in the self-interest of any political party to put vacant home taxes in place.

        I hope this clarifies things a bit for you Todd J.

      • Rick Abrams 6 years ago

        Well said!!!

  • Al Daimee 6 years ago

    It makes no sense to me why a domestic owner would sit on an empty property when we have a strong rental market. Seems like throwing money away to me. Some believe that keeping a home brand new will be worth more, but I’m not convinced that the delta between the costs of keeping a home empty vs. rent and repairs really make sense when rents are high.

    Foreign buyers have their reasons, such as tax implications and reporting foreign income in their home country.

    • Michael Z. 6 years ago

      It’s very strange, considering how quickly rentals are going. Rental income would easily subsidize the interest lost, etc..

      Do people actually keep homes brand new, because they think it preserves value? I didn’t think a home was like a car, it doesn’t lose half it’s value as soon as its driven. Most people expect some level of wear, without expecting a discount.

    • bluetheimpala 6 years ago

      Being a landlord is hella stressful and can be expensive. Maybe that’s just my experience but if I had a donut that was doing +20% a year and didn’t think it would come down, ever, why would I do anything other than sit on it, maybe add some Jimmies? Also, regarding that point, sitting on the donut not the jimmies, if I got into the donut game but don’t know how/when to exit I am DEFINITELY NOT messing my donut up or locking it into a 1 year donut lease (yum!).

      I think the vacancies and the response to the vacancy tax is quite telling; these are investors who want to maximize short term profit not pivot to long term rentals. If I am doing a pump and dump in Swaziland, do I flip into a landlord or get the f-out?

    • yyz 6 years ago

      Main reason why owner choose to keep the property vacant is to eliminate the headache of being a landlord. Rental income is never a straight shot. It take lots of underlining effort to run a successful rental property. Most renters do not take care of the property to the level of the owner. Many renter thinks you are taking advantage of them; and in a way it is true. Therefore, you are considered very lucky to get the rental check on time every month, and no damage to the property by the end of the term. If you are unlucky, you will end up having a tenant stop paying rent after first month and takes months and $$ to evict them out and end up with a trashed property. Of course you can sue them but likely you will end up with nothing in return for the effort. With the ridiculously high price in Toronto, it is common to be cash flow negative to be rental anyway. Some people will think the little money that come in is not worth the risk and effort.

  • Grim 6 years ago

    This doesn’t mean the City of Toronto. This has outlined the GTA.

  • Noah 6 years ago

    The numbers here seem off or misleading. The data says that 63-75% of 2% of GTA homeowners might be subject to a vacancy tax. Doesn’t that suggest a vacant home percentage of 1.26-1.5%, which is significantly lower than 2%? Also, the data doesn’t seem to speak to occasionally occupied homes. Do survey respondents understand that a vacancy tax might apply to such homes too, and thus they are included in the 1.26-1.5%, or not?

    • Michael Z. 6 years ago

      The survey was conducted with GTA homeowners, and they were asked about their second home. The tax would only apply if their second home was in the GTA.

      I do suspect that some of the respondents didn’t understand the questions, because I’ve now read the actual document and the numbers/logic doesn’t make sense. i.e. if only 2% of homes are vacant, why would 25% of them want to sell if there was a vacant home tax?

      Occasionally occupied homes would not have been included, considering these were people that are from the city. The City of Toronto’s study found significantly more vacant homes, and didn’t include the suburbs. The number is much larger than the TREB survey, but it’s nice to see that the industry is now aware it’s happening.

  • Brian 6 years ago

    The problem with renting is dealing with bad tenants, damage repairs, rent control.

    • Tamagochi 6 years ago

      Rent control makes it difficult to want to rent your home to people. Bad idea. Too many new regulations all at once.

    • Al Daimee 6 years ago

      Bad tenants and repairs can happen, sure, but I would rather have that income and put it toward any necessary expenses, which are also a write-down against that income. More often than not, tenants are pretty good, so the risks are not worth leaving a place empty, IMO.

      • yyz 6 years ago

        All it take is 1 bad tenant to erase years of your gain from many good tenants.

  • Joe 6 years ago

    Easy to see… just go to realtor/zolo and look at the listings in Vaughan, ON. Roughly 7-8/10 are completely empty/staged.

    • bluetheimpala 6 years ago

      Yup, everyone is trying to get out before the blood shed. Watch as the smart money navigate the next few months…there are already example of $20-$80K differences for the same house in the same area. More listing everyday.

  • Alistair McLaughlin 6 years ago

    So 1 in 5 GTA homeowners owns a second property within the GTA? That’s even worse than the 1 in 6 that was reported a while back!

    Mass participation in the “investment” property market by the middle class was one of the defining characteristics of the US bubble.

    • Al Daimee 6 years ago

      “Mass participation in the “investment” property market by the middle class was one of the defining characteristics of the US bubble.”

      There is a distinct difference in what happened in the U.S. market. Loans were being handed out like candy without buyers being qualified. We are not seeing that here thanks to our much more conservative lending environment.

      Unless the rental market implodes (which would take no more population growth and/or excessive rental housing supply, neither of which are in the cards right now), investment properties are filling the hole left by a lack of purpose-built rental properties. With the rent control changes, proposed rental buildings have been cancelled or converted to condos for sale and land has been changing hands to the wealthiest of developers/investment firms.

      • MH 6 years ago

        Apparently this “conservative lending environment” has some peculiar side-effects like Canada having the highest household debt-to-GDP ratio among the 35 developed and developing countries. Go figure…

        • Al Daimee 6 years ago

          One of my banking exec friends told me that Canada avoided the 2008-9 economic downturn largely due to our conservative banking policy. In the U.S. there were N.I.N.J.A. mortgages (No Income, No Job or Assets) being given out, while that was not possible in Canada.

          The mortgage/banking industry was so unregulated in the U.S. compared to Canada, hence our “conservative lending environment”.

        • bluetheimpala 6 years ago


  • Jungle 6 years ago

    We are in an affordable housing crises in a growing city. Homes are for living and shelter, not hoarding to use as piggy bank or speculation.

    Bring those empty homes to market or rent them out. Go hoard elsewhere or invest properly in a balanced portfolio.

    Don’t take homes away from market making affordability worse.

    • Zhang Zhong 6 years ago


      What are you going to do about it? I have 10 homes and they are empty. I live in Beijing. I use QIIP to obtain Canada citizenship and my children are getting subsidized education. My parents get free health care and I claim $97 per year of income and claim welfare and receive child payments. You are losers paying for my next house. Keep it coming losers with your silly little potato. Send him over here again so we can kick him out of our country again.

  • Tommy 6 years ago


    Sales are way down yet we’re hear talking about vacant homes as though they would be readily purchased anyway. If sales are down, either demand is down or prices are too high. Let it shake out, but leave people to do what they want with property they own.

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