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Between 2014 and 2016, the proportion of non-permanent residents in Vancouver mortgages in Canada’s five largest housing markets rose from 3.3 per cent to 3.9 per cent; Toronto from 2.0 per cent to 2.7 per cent; Montreal from 1.6 per cent to 1.9 per cent; Winnipeg from 2.8 per cent to 2.9 per cent; and only Calgary fell from 2.8 per cent to 2.9 per cent between 2014 and 2016, according to a report by Canadian mortgage and housing company (CMHC). The proportion of non-permanent residents under the age of 25 who received mortgage loans reached as high as 10% in Toronto and Vancouver in 2016.
According to the definition of the report, a non-permanent resident refers to an international student, a foreign worker, a domestic refugee applicant or a person who has obtained a work visa on a human basis. In other words, these foreigners under the age of 25 are basically foreign students.
According to CMHC, the number of these non-permanent residents increased from 393000 in 2003 to 759000 in 2015, while the number of international students increased from 181000 in 2006 to 353000 in 2015.
Mokinen, a senior real estate agent in Toronto, said that foreign students are indeed more active in buying houses. There are many destabilizing factors in Chinese mainland’s housing market, and the Chinese want to invest overseas in order to spread the risk.
‘There are a lot of foreign students from China in Toronto who need accommodation,’he said. Qualified parents will think that it is better to buy an apartment for their children than to rent a house for four years.
Moreover, at that time, it was easy for foreign buyers to get a mortgage, as long as they could afford a 35% down payment. The bank may require the applicant to provide proof of overseas income, but the requirement is very lenient, even an employer’s letter in Chinese is fine, without translation into English or notarization.
Senior Canadian real estate agents say overseas buyers generally choose to invest in uncompleted flats. Especially for the high-rise apartments in the city center, the delivery time is relatively long, which takes 4 or 5 years. When buying uncompleted flats, only a deposit is paid, and the 15% tax is not involved. recently, the apartment market is good and has been on the rise. buyers can transfer the contract to make money before the apartment is delivered.
If you successfully emigrate after 5 years, or get a work visa, you can also buy your own apartment without paying a 15% tax.
The rapid rise in house prices in Toronto is mainly driven by short houses such as detached houses, while the rise in apartment prices is weak. After the introduction of a tax on foreign buyers in April last year, it was independent houses that led to the decline in house prices, but apartments gained momentum and became the main force driving the housing market to recover.
The average price of all short houses in Toronto fell in January compared with the same period last year, while apartment prices rose 14.6%. The average house price in the area is mainly supported by the apartment market, according to a report released by the Toronto Real Estate Bureau on February 6.
The apartment is not only relatively cheap, the most important thing is that the rent has risen rapidly recently and the return on investment is good. In the past few months, several of his Chinese immigrant clients have decided to invest in apartments. After buying the apartment, I found that the rent was more than 20% higher than that of the previous year.