Foreign money helping to fuel Canada’s condo boom: housing agency

Condo construction in Canadian cities has boom in recent years -- nowhere moreso than in Toronto. Credit/GETTY IMAGES

MONTREAL – The number of Canadian condominiums owned by foreign residents in Vancouver, Toronto and Winnipeg rose over the past year, the Canada Mortgage and Housing Corp. says.

CMHC released a survey Thursday that says foreign buyers owned 3.5 per cent of condos in Vancouver in 2015, up from 2.3 per cent last year. That’s the highest rate of all 16 metropolitan areas tracked in the agency’s research.

In Toronto, the rate of foreign ownership rose to 3.3 per cent this year, up from 2.4 per cent the year before. The rate of foreign ownership in Winnipeg’s condo market rose to 2.7 per cent, a jump from 0.1 per cent last year.

The survey sheds some light on what has been a politically charged issue, particularly in British Columbia.

Concerns have arisen recently that wealthy foreign buyers are driving up the cost of homes in Vancouver, making them unaffordable for local residents. Critics have suggested that the market could crash if those buyers decided to cash out and sell.

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The federal housing agency says it is exploring ways to broaden the scope of its research to include other types of housing, such as single family homes — a property type that has surged well ahead of other residential properties.

CMHC says more information is also needed about what is motivating foreign buyers. For example, some may be purchasing properties to house their families, while others may be seeking revenue, either by renting the property out or by selling it when its value increases.

Montreal was one of the few cities where the rate of foreign ownership of condos fell, decreasing to 1.3 per cent from 1.5 per cent.

The rate of foreign ownership in several of the city subareas measured — including the Burrard Peninsula in Vancouver, which previously showed a rate of 5.8 per cent of foreign ownership — was withheld, with CMHC citing either confidentiality concerns or the fact that data for some areas may not be statistically significant.

CMHC conducts the survey by asking property managers how many condo units in their buildings are owned by people whose permanent residence is outside of Canada.

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