How Rising Property Taxes Are Affecting Home Affordability in Canada

Property taxes are going up across Canada, and it’s not just an abstract number on your tax bill. It’s directly affecting what homes people can afford, how much they can borrow, and whether they can keep up with ownership costs. When your monthly property tax bill increases, your mortgage approval amount can shrink, and your long-term affordability picture changes. This article breaks down what’s causing property tax increases, how they impact both buyers and homeowners, and what you can do about it.

What’s Causing Property Taxes to Rise Across Canada?

Property taxes are based on two things: your property’s assessed value and the local tax rate (also called the mill rate). Both are increasing at the same time, which results in much higher bills for homeowners.

Municipal Budget Increases

Cities like Toronto, Vancouver, and Calgary are raising property taxes to cover growing costs for services like infrastructure, transit, and emergency services. Without additional help from federal or provincial governments, municipalities rely on homeowners to fill the gap.

Higher Property Assessments

Housing prices have surged in recent years. Now, new assessments are catching up to those values. Even if your local tax rate stays the same, a higher assessment means a higher tax bill.

Changes in Provincial Funding

Some provinces have shifted responsibilities to municipalities without increasing financial support. This forces local governments to make up the shortfall by increasing property taxes.

Local Inflation and Service Costs

Rising wages, fuel costs, and material expenses are making it more expensive for cities to maintain basic services. These costs are passed on to homeowners through higher taxes.

Why It Matters for Homebuyers and Owners

Rising property taxes increase the cost of homeownership in both obvious and hidden ways. For buyers, it reduces how much they can borrow, since lenders include taxes in their affordability calculations. For homeowners, higher annual taxes make it harder to manage monthly budgets and long-term financial plans.

A $500–$1,000 increase in annual taxes can reduce your mortgage eligibility by thousands of dollars. That could change the type of home you can afford or require you to look in a different neighbourhood.

Smart Ways to Deal with Property Tax Increases

You can’t stop tax increases, but you can plan around them. These practical tips will help you manage the impact:

Appeal Your Property’s Assessed Value

If your home’s assessment seems too high, you can appeal it. Gather recent sales data for similar homes and submit a formal request through your provincial or municipal property assessment office.

Ask for Accurate Property Tax Estimates When Buying

Before buying a home, ask for the most recent tax bill. Also check if the property has been recently reassessed. A home that looks affordable on paper could carry a much higher tax cost than expected.

Research Municipal Tax History Before Choosing a Neighbourhood

Some cities and towns have a stable history of tax rates, while others increase aggressively year over year. Review property tax trends and compare them as part of your decision-making process.

Check Eligibility for Tax Relief or Rebate Programs

Some cities and provinces offer property tax relief programs for seniors, low-income households, and first-time buyers. Look up your local municipality’s website to see if you qualify.

Include Tax Growth in Your Housing Budget

Set aside an extra $50–$100 per month to prepare for tax increases. Building this buffer into your budget will help you stay stable when new bills arrive.

Conclusion

Rising property taxes are affecting affordability in a very real way. They’re driven by higher assessments, growing municipal budgets, and shifts in provincial funding. As a result, both buyers and homeowners need to adjust their planning.

Start by checking how your property is assessed, planning for tax increases in your budget, and asking for the full tax picture when considering a new home. If you need help factoring taxes into your mortgage strategy, reach out to Pradip Maheshvari for expert, personalized guidance on protecting your affordability.

Best Places to Buy Property in Ontario Right Now (And Why)

Ontario’s real estate market in 2025 is shifting. While big-city prices remain high, new pockets of opportunity have emerged, offering better value, stronger appreciation potential, and lifestyle perks for both investors and end users. Whether you’re a first-time buyer, looking for a family upgrade, or planning a long-term investment, choosing the right location can make or break your outcome.

Below is a breakdown of the top places in Ontario to buy property right now, and why each market stands out.

1. Hamilton – The Best of Urban and Affordability

Hamilton continues to attract buyers priced out of Toronto. With a solid job market, universities, and major infrastructure upgrades (like LRT construction and GO transit expansion), Hamilton offers an urban lifestyle at a more accessible price point.

Why it’s hot:

  • Still cheaper than Toronto and Mississauga
  • High rental demand from students and professionals
  • Ongoing city revitalization, especially downtown

For buyers looking for duplexes, starter homes, or investment properties, Hamilton hits the sweet spot between price and potential.

2. London – A Fast-Growing Hub with Affordable Homes

London, Ontario, is no longer just a university town. With a booming healthcare sector, new tech employers, and more people working remotely, the demand for housing in London is rising steadily.

What makes it attractive:

  • Average home prices are significantly below the provincial average
  • Growing population and infrastructure investment
  • Strong rental market for both families and students

For investors and end-users alike, London offers stability, appreciation, and relatively low entry costs.

3. Ottawa – Stable, Government-Backed Growth

As Canada’s capital, Ottawa benefits from a strong public sector employment base. This provides insulation from economic volatility, making it one of the most stable real estate markets in the country.

Key strengths:

  • Reliable job market and steady population growth
  • Diverse mix of property types from condos to family homes
  • Growing tech industry alongside federal employment

If you’re seeking long-term appreciation with low risk, Ottawa deserves a serious look.

4. Windsor – Underrated and Poised for Upside

Windsor has quietly become one of the best value markets in Ontario. It’s benefiting from major automotive investments and a surge in cross-border interest due to its proximity to Detroit.

Why Windsor is a sleeper pick:

  • One of Ontario’s most affordable cities
  • New battery and EV manufacturing jobs boosting local economy
  • Massive infrastructure projects, including bridge expansion

Windsor is ideal for those prioritizing cash flow or entry-level investment properties.

5. Kitchener-Waterloo – The Silicon Valley of the North

Kitchener-Waterloo’s tech industry, including giants like Google and Shopify, continues to drive demand for homes. Add in universities and a young professional population, and you get a fast-moving, high-demand real estate market.

What stands out:

  • Strong economic fundamentals
  • Excellent appreciation over the last five years
  • Desirable lifestyle and access to Toronto via GO train

It’s competitive, but the long-term upside remains strong, especially for those buying early in newer developments.

6. Barrie – A Balanced Market with GTA Proximity

For those priced out of the GTA, Barrie offers a livable alternative. It has good schools, a strong sense of community, and lakefront living, all within commuting distance of Toronto.

Advantages of buying in Barrie:

  • Steady property appreciation
  • Commuter rail access to the GTA
  • Lower property taxes and less congestion

As more people seek work-life balance and space, Barrie is absorbing overflow demand from Toronto and York Region.

7. Kingston – The Quiet Winner for Long-Term Value

Kingston offers a mix of education, healthcare, tourism, and waterfront charm. It remains under the radar, which means prices are still reasonable.

Why it’s worth considering:

  • Queen’s University and stable student housing demand
  • Strong public services sector (military, healthcare)
  • Growing reputation as a retirement destination

If you’re looking for a low-maintenance investment or long-term living, Kingston is a strategic, lower-risk option.

Choosing Based on Your Goals

Not every city fits every buyer. Here’s how to think about it:

  • For investors: Look at Windsor, Hamilton, and London for best price-to-rent ratios
  • For families: Ottawa and Barrie offer stability and strong schools
  • For professionals: Kitchener-Waterloo and Hamilton are rich in career options and lifestyle
  • For retirees or slow-growth seekers: Kingston provides peace of mind and consistent returns

Conclusion

Ontario’s real estate market is more diverse than ever. While Toronto will always be the flagship city, smart buyers are looking at fast-growing secondary markets where job growth, affordability, and livability are aligning. Whether you’re after cash flow, appreciation, or a place to call home, the cities above represent the best places to buy property in Ontario right now.Pradip Maheshvari helps homebuyers and investors navigate these opportunities with expert mortgage guidance tailored to their financial goals. Let’s talk about where and how you can buy with confidence.