Skyrocketing demand and rising cost of housing is the "unwanted consequence" of a growing economy, but the province's new measures will make the process of finding a place to live a little easier, a little less frantic and a lot fairer, Wynne said.
The average price of detached houses in the Greater Toronto Area rose to $1.21 million Canadian (US$900,000) last month.
"Landlord's might be a little upset, but it's the best rental market for them in 30 years, so they're doing fine", he said with a smirk.
Premier Kathleen Wynne announced in Toronto one of the measures will be a 15 per cent Non-Resident Speculation Tax (NRST) on non-Canadian citizens, non-permanent residents and non-Canadian corporations buying residential properties containing one to six units in the GTHA. Once the legislation passes, the foreign tax would be effective retroactively to April 21.
"I'm also gratified that the provincial government will allow the City to move forward with a vacant homes tax, subject to the results of our examination, and other measures to curtail speculation and add new supply into the marketplace right away".
The province's housing package will also expand rent control, which now only applies to units built before November 1991, after tenants in newer units complained of dramatic spikes in rent. Under the new regime, rent increases will now be limited to 1.5-2.5 per cent annually - roughly the rate of inflation - for all rental units.
Economists said they were somewhat surprised not to see any measures tackling domestic speculators, particularly considering the amount of discussion the topic had drawn.
Sydney, Singapore and Hong Kong have also introduced foreign buyers taxes.
Sydney, Singapore and Hong Kong have also introduced foreign buyers taxes. "But if Vancouver is any guide, we might see a short period in which domestic buyers will sit on the sidelines while assessing the impact of the tax".
"That's exactly what we've seen in Vancouver", said Tal.
Home prices in the Toronto region rose 6.2 percent in March, the biggest one-month gain on record, according to a benchmark price index by the Canadian Real Estate Association, and jumped nearly 30 percent in the past 12 months.
"You can't go to a barbecue in the province without people talking about real estate and how everyone has a son or daughter who can't buy a home and wants to get into the market", Hudak said.
Prem Watsa, head of Canadian investment firm Fairfax Financial Holdings Inc., said the Toronto property market is in a bubble that will end with pain for banks that financed the growth.
In public comments last week, Sousa said speculators are reselling contracts for pre-construction homes multiple times before closing, using assignment clauses.
"When young people can't afford their own apartment or can't imagine ever owning their own home, we know we have a problem", she said.
However, Kavcic said the impact in Toronto could be more muted than it was in Vancouver, as the tax is not coming as a surprise and there are more exemptions.