Photo: Kyle Pearce/Flickr
The 2016 Canadian federal budget has been unveiled, and it includes a proposal to get more information on foreign ownership in the country’s housing market to help inform future government policy.
“We know that Many Canadians, particularly British Columbians, are concerned about the effect of foreign ownership in the housing market,” said Finance Minister Bill Morneau in the House of Commons yesterday.
“Unfortunately, the problem isn’t fully understood. More information is needed. To fill this data gap, and so many others like it, we will support Statistics Canada so that it can improve our understanding of important problems and help us all make better decisions,” he continued.
The federal support for the new initiative comes in the form of $500,000 in funding for Statistics Canada so that the national agency can “develop methods for gathering data on the purchases of Canadian housing by foreign homebuyers,” according to a note posted to the budget’s official website.
“This initiative could involve collaboration with the provinces, such as British Columbia, which recently announced its intention to have homebuyers disclose whether they are citizens or permanent residents of Canada or another country,” the budget reads.
Many believe foreign ownership is inflating real estate prices in Toronto and Vancouver, making these markets unaffordable for locals, and the lack of comprehensive data on offshore buyers has been highlighted by observers for some time.
BC Housing is already studying foreign ownership in British Columbia. And late last year, the Canada Mortgage and Housing Corporation (CMHC), said it was looking into ramping up data collection on foreign home ownership, possibly by surveying realtors, builders, and lenders. The CMHC could also work with municipal land registries and various levels of government, it said.
The Crown corporation’s announcement followed a report from the CMHC that said there was a “statistically significant” increase in levels of foreign condo ownership in Toronto and Vancouver.
Starting in 2016-2017, the federal government also plans to set aside $2.3 billion over two years for affordable housing initiatives. “A significant portion” will go towards provinces and territories, which will then be able to target communities they deem in need, and $739 million has been earmarked for “First Nations, Inuit and northern housing.”
The budget indicates that these may not be the last housing market measures the government takes in the coming years.
“The government will continue to closely monitor vulnerabilities related to housing and consumer debt and is prepared to implement further measures, should they be needed.”