Design district.A large number of Americans rushed to buy! After Canada announced a two-year ban on foreign investors from buying residential property, US buyers are seizing the last opportunity to buy holiday homes, ski houses and other entertainment properties in Canada, according to a report.Please Visit: Design district to Get Your VVIP Registration Today!
The federal government announced the new policy in April and passed legislation in June, which is expected to come into effect on January 1, 2023.
According to a new report from Royal LePage, about 75 per cent of US citizens who currently own entertainment properties in Canada bought it after the ban was announced in April. Another 67% of Americans who plan to buy homes in Canada make Canadian real estate more attractive to Americans because of the current strength of the US dollar against the Canadian dollar, even if interest rates are high.
The report’s data are based on an online survey of 1506 U.S. citizens over the age of 18 living in Canadian border states between November 8 and November 14, 2022.
Respondents to the survey said the main reasons for buying a house in Canada were retirement, investment and seasonal use.
The report also reflects the advantage that entertainment properties are more popular with foreign buyers because of their exemption from overseas buyers’ tax. The entertainment property market has been boosted by taxes imposed on residential properties by overseas buyers in some Canadian provinces.
House prices fell sharply in BC province in 2016 after the introduction of a tax on overseas buyers. The same thing happened in Ontario in 2017, when house prices in Toronto fell by 6% after the overseas buyer tax came into effect. Investment by foreign buyers fell sharply from 5 per cent to 3.5 per cent.
Although overseas buyers account for a small proportion of homeowners in Canada, they still have an impact on the housing market.
Despite the rush to buy property, it is not clear whether entertainment properties are affected by the ban. When asked whether entertainment properties will be exempted, Canadian Mortgage and Housing Corporation (CMHC) spokesman Claudie Chabot said, “the full details will be announced soon.”
In response to the report, Sheila Block, senior economist at the Canadian Center for alternative Policy, said, “the sample of this survey is relatively small, with only 1506 US citizens living at the border.” Therefore, this is a small survey of specific market segments of the real estate market and does not show how much the impact of the ban is. ”
In addition, she added that about 70 per cent of respondents had dual US-Canadian nationality or a Canadian spouse, affecting the accuracy of the results.
