So what’s really going on? Well, it’s complicated.
Toronto real estate guru Brad Lamb doesn’t finger point to overseas investors.
“The scarcity of the product — in this case, single detached homes — is key,” he said in an interview with the CBC. “And as the Toronto population grows and land available for new houses becomes scarce, the competition for these homes will become even more intense.”
Instead, Lamb suggests we need to change our expectations to align with a new reality — and embrace condo life.
He says the idea that you can live in a downtown core in a detached home and still be wealthy is out of touch to the way cities evolve. And it isn’t a bad thing — we just need to get used to the idea of living in condos.
The unavailability of statistics doesn’t help, either, as Canada doesn’t keep track of the amount of homes bought by non-residents.
“I’d love to have those numbers but we don’t keep them. You’d have to ask the government of Canada why not,” said Cameron Muir, chief economist of the British Columbia Real Estate Association.
He did a bit of number crunching, though, and through analysis and digging up proxies, he said only about two per cent of home sales in Metro Vancouver are to non-resident buyers.
“This idea that we have this rampant foreign ownership going on and this horde of Chinese investors coming over is a little bit of an urban myth,” citing further confusion over who is a landed immigrant and who is a foreign investor.
But still, some want to blame foreign investors entirely for driving up prices to unreasonable and unattainable new heights. Although experts are quick to point out how desirable our market is.
Our market is cheap compared to others, and foreign investors see it as a reliable, and affordable, investment.
Investors look to the Canadian real estate market from China, the Middle East, Korea, Russia, India, and the Philippines, according to Tony Ma, owner of HomeLife Landmark Realty.
Ma says that Canada’s stable government and banking system and the relatively low prices draw investors. While condos in Toronto’s downtown go for $800 per square foot, in Bejing it’s $2,000.
It’s certainly complicated and there are a million factors, but what do you think? Weigh in below!