Photo: Nick Kenrick/Flickr
Foreign nationals bought one in every 10 homes sold in Metro Vancouver between June 10th and July 14th of this year, new data from the BC government shows.
Released on July 26th, a day after the province announced plans to impose a 15 per cent tax on foreign nationals and corporations buying residential properties in the region, the data was gathered to assess the impact that foreign capital is having on residential real estate prices. It updates initial information on foreign buyers in BC published on July 7th.
Overall, Metro Vancouver, an area that covers 20 municipalities, including the City of Vancouver, accounted for 49.7 per cent of all residential real estate transactions in BC during the period studied, and 73.3 per cent of transactions in the province that involved foreign nationals. By value, foreign nationals were responsible for $885 million worth of Metro Vancouver transactions, or 10 per cent of the total value of all property transfers.
Chart: Province of BC
Foreign nationals are defined as people who are not Canadian citizens or permanent residents, while foreign corporations are businesses that are either not registered in Canada or are controlled by foreigners.
Within Metro Vancouver, Richmond saw the highest percentage of residential real estate transactions involving foreign nationals, at 18.2 per cent. Burnaby was next at 17.7 per cent, while Vancouver came in at 10.9 per cent and Surrey stood at 8.4 per cent. Vancouver transactions involving foreign nationals had the highest average value at $1,114,676.
Chart: Province of BC
The foreign buyers data initially released by the BC government suggested that foreign nationals accounted for a smaller percentage of residential real estate transactions in Metro Vancouver. Collected between June 10th and June 29th of this year, it showed that only 5.1 per cent of transactions valued at $351 million involved foreign nationals.
The higher one-in-ten statistic is a concern because the BC government has identified foreign investment in residential real estate as one of the factors driving high housing prices in the province. Its hope is that the new tax will help curb price increases and keep homeownership accessible for the middle class.
The tax is set to come into effect on August 2nd. While it will initially stand at 15 per cent, the BC government has said that depending on its impact, it may reduce it to 10 per cent or increase it to 20 per cent. Forthcoming foreign buyers data covering the period from June 10th to August 1st will be used to help make the decision.