“I’ve already seen Chinese buyers come in,” Matt Elkind, an agent with the Condo Store, told Real Estate Professional. “I’m sure there are certain investors who will look less fondly on Canada, but on the ground here, we’re seeing money that would have gone to Vancouver coming here.”
Vancouver’s 15% on foreign investors has only been in place since August 2 and buyers rushed to beat that deadline. Many who missed that deadline, however, appear to be taking their cash elsewhere.
However, those investment dollars now be allocated to Toronto’s market aren’t expected to have a major impact on home prices.
“I’m seeing the impact in Toronto, but it’s not a major driver of the market. It won’t make things unaffordable to the point where a similar policy will be implemented here,” Elkind said. “We aren’t at the place where we see empty houses purchased by foreign investors.”
It’s a predication shared by Toronto-based investor Paul D’Abruzzo.
“I think you might see some of that money float here. But there’s so much money floating around already that I don’t think you’ll see a drastic impact,” he said. “You might get a bit, but I don’t think it’ll be enough that you can track, realistically.”
And while no real estate professional can predict what sort of policy may be in the pipe within each province, neither Elkind nor D’Abruzzo believe Toronto will implement its own tax on foreigners.
“I think that there’s a lot more at stake to start getting into that sort of protectionism,” Elkind said. “You can never estimate what politicians will do, but the potential negative to foreign business … will offset trying to make housing slightly more affordable.”
“I don’t think we have the same issue with foreign money as they do there and the ghost houses they have there,” D’Abruzzo added. “That isn’t really an issue here. We have a housing shortage; people are buying houses and living in them here.”
But that doesn’t mean a similar policy will soon be passed in Canada’s largest city.