“I was asked … if I supported new taxes on foreign investors. I think the answer is you need to be a lot more thoughtful than a yes or no,” Phil Soper, president and CEO of Royal LePage, told REP. “Knee-jerk public policy like a change in taxes for political reasons would be a very sad more for a country known for its tolerance. Brand Canada would be harmed.”
Many have argued in favour of the federal government implemented measures to discourage foreign investment in the housing market. It is one factor some speculate is pushing prices to unreachable levels for Canadians in markets such as Toronto and Vancouver.
However, such measures would be not be appreciated by Canadians who invest abroad, according to Soper.
“I look at the importance of Canadian foreign investors in the American sunbelt residential real estate market during their six year downturn. If it wasn’t for Canadians, many of those communities in places like Phoenix, Las Vegas, California, Florida, would have been shuttered,” Soper said. “But the high Canadian dollar, lower prices, eagerness and marketing focus brought in a lot of Canadian investors.
“Guess what, things have tightened up and many Americans may lose a deal to a Canadian. But no one is suggesting a special tax on Canadian investors in American real estate.”
And discouraging foreign investment in the housing market could have a wider-reaching impact.
“Is the ability to buy a home in Vancouver one of the things that leads to wealthy foreign investors investing in the forestry sector, in mining, in oil and gas, in high tech firms in Vancouver,” Soper said. “Are we hurting another arm of the economy if we slam this door shot?”
Leading real estate veteran argues against measures to rein in foreign investment.