Given the Bank of Canada’s recent announcement to raise interest rates for the second time this year, combined with nationally rising home prices, affordability is a top priority for homebuyers. In addition to the cost of a home, homeownership expenses can also have an impact on a buyer’s budget.
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Just as average home prices vary greatly across markets in Canada, so do homeownership costs like property taxes. Residential property tax rates are based on an assessment of the home’s value and the residential property tax rate set by the local municipality. Those looking to buy a home in various cities need to be aware of how the local tax rate will impact their overall housing affordability. So where in Canada can residents save on property taxes?
We compiled a list of 25 cities across Canada and their property tax rates for 2023 and calculated the amount of property taxes a resident would pay on a home at the average price, $500,000, and $1,000,000.
Top 4 Cities with the Lowest Property Tax Rates Are in British Columbia
If you’re looking to save on property taxes, head out West; Vancouver, Abbotsford, Kelowna and Victoria all have property tax rates under 0.5% and are significantly lower than other major cities. Even with an average home price of $1,188,000, Vancouver homeowners would only have to pay $3,303 in property taxes annually. This is in contrast to Toronto residents, who would pay over double that amount at $7,969 for a similarly priced home.
Montreal rounds out the top five with a low property tax rate of 0.5305%, and with an average home price of $519,200, homeowners would pay only $2,754 in property taxes – the lowest amount on our list for a home at average price. The second-lowest property tax bill for a home at average price goes to St. John’s, where homeowners would pay $2,997 on a $280,400 home.
The Prairies and Atlantic Coast Have the Highest Property Tax Rates
Despite having an average home price less than half of Vancouver and Toronto, Winnipeg has a property tax rate that far exceeds all other cities. With a tax rate of 2.6439%, homeowners in Winnipeg can expect to pay $9,111 in taxes on an average-priced home of $344,600. That’s more than double what homeowners in Edmonton, Quebec, Calgary, Victoria and Kelowna pay on a home at average price.
Sault Ste. Marie has the second-highest property tax rate at 1.720655%, meaning homeowners would pay $4,759 on an average-priced home of $276,600. Charlottetown and Saint John follow with similarly high rates of 1.67% and 1.62% respectively, though with average home prices below $350,000, residents can expect to pay less on an average-priced home than those in most of Ontario.
In fact, the city with the largest property tax bill on a home at average price is Guelph. With a property tax rate of 1.229079% and an average home price of $824,500, homeowners would pay $10,134 in property taxes annually. Burlington is not far behind with a property tax rate of 0.861440 and an average home price of $1,086,400, homeowners would pay $9,359 in property taxes.
Whether you’ve taken property tax rates into account or not, it’s always best to speak to an expert real estate agent who can walk you through the process of buying a home, as well as what costs you’ll need to consider that you may have overlooked. Give us a call today to connect with a qualified real estate professional!
