Ajax calls for province to lower deposits for new builds
Published September 30, 2021 at 4:13 pm
Ajax Town council will ask the provincial government to reduce deposit costs for newly built homes.
Councillor Ashmeed Khan put forward a motion at Monday’s council meeting to request the Ontario government work with Tarion, Ontario’s new-build regulators, to cap deposits at five per cent. The motion was eventually amended after much debate to an unspecified “reduction.”
Khan told council minimum down payments for resale properties tend to be around five per cent. Deposits for newly built homes, however, can reach 25 per cent, he said.
“New builds are notorious for delays in construction,” he elaborated, “causing money to sit in trust. Even more frustrating, some new builds are simply cancelled causing money to be returned with no earned interest.”
Councillor Rob Tyler-Morin called the motion a “no-brainer ask,” adding that it was important that “all levels of government try something, anything we can do, to try and nudge things along.”
He hopes other municipalities will put forward similar motions to pressure the Ontario government into creating deposit cap regulations.
Mayor Shaun Collier had concerns with the five per cent cap, saying the recent cost increase of building materials during the pandemic could place more financial strain on developers. He asked if the councillors had considered that developers are using the deposits to fund the builds.
“It’s the cost of doing business,” Khan responded “If they raise their price from $800,000 to 1.6 million, the five per cent is the five per cent”insauga's Editorial Standards and Policies