Yahoo Finance The 3 Places With the Highest Property Taxes in the Canada
Written by Amy Legate-Wolfe at The Motley Fool Canada
Canadians are already familiar with the rising home prices across the country. While they’d eased off slightly in the last year, the cost of owning a home has never been more financially difficult. Prices of homes have come down since peaking in 2021 and 2021. However, the Canada Real Estate Association (CREA) found most recently that home prices averaged $668,754 in July 2023. This was up 6.3% from the year before.
And while home prices may have come down since all-time highs, rising interest rates certainly take a hit on owning a home. This is why Canadians should be taking every type of cost into consideration before owning a new home. And one of those costs include sometimes hefty property taxes. That’s why today, we’re going to look at the highest property taxes in the country and what Canadians can do about it.
What are property taxes?
Before we get to the list of areas with the highest property taxes in Canada, let’s first go over why we’re charged these taxes in the first place. Property taxes vary from one area to another, and for good reason. The needs of one province, country and even town can be quite different from the needs of another.
This is why owning the exact home in two different locations can be either a small payment or a massive part of your budget. And in most areas, property taxes will only continue to increase every year. Before buying a home, it’s important to identify what property taxes could cost you.
The amount Canadians pay for property taxes comes down to the assessed value of the home and the property tax rate of where they live. The assessed part is important, as this is usually far lower than what you paid for the home.
The three places with the highest property taxes
To go over the top three areas with the highest property taxes, we’ll be looking at the tax rate, of course. However, Canadians will also need to take into consideration the average value of the home in this area to come up with annual property taxes. This is an important point, as even though an area may have the highest property taxes, a lower assessed home value could mean you’re still paying less than other areas of the country.
Ranking | Location | Propety Tax Rate | Average Home Value | Annual Property Taxes |
1 | Winnipeg, MB | 2.64% | $347,200 | $9,166.08 |
2 | Sault Ste-Marie, ON | 1.72% | $348,889 | $6,000.89 |
3 | Charlottetown, PEI | 1.67% | $386,079 | $6,447.52 |
Before you pack up and move
While these are the highest property tax rates in the country, it’s important to note the price of a home here. It’s unlikely you’re going to find a home for $347,200 in Toronto, for example, where property taxes are 0.65% as of writing.
What you can do about it
Property taxes are only going to go up, and, honestly, moving locations isn’t going to bring down your costs when you take in the costs it takes to move in the first place. That’s why one of the best things you can do is start putting aside money for emergencies and future needs.
In fact, you can take advantage of property investing by investing in a stock like Granite REIT (TSX:GRT.UN). This stock provides monthly dividend income with a current yield at 4.42%. Therefore, if you start putting aside cash every month and reinvesting it on a regular basis, you can create a large portfolio to use when property taxes potentially get to be too much.
Times are hard right now, but there are certainly ways to manage your finances. Knowing what your property taxes are used for, how they’re calculated, and how you can potentially bring them down is a great start. But investing for the future is always a strong way to push back at rising taxes.
The post The 3 Places With the Highest Property Taxes in the Canada appeared first on The Motley Fool Canada.
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Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Granite Real Estate Investment Trust. The Motley Fool has a disclosure policy.
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