Resurgent city led by demand from afar

The foreign buyer taxes in Toronto and Vancouver have helped kick Montreal’s real estate into high gear, and buyers from China are leading the charge.

“They’re buying brand new condos downtown and a lot of it is through word of mouth,” said Montreal-based chartered broker Amy Assaad of Royal LePage. “There are some condo buildings in the downtown core where you’ll see 50% ownership of Asian buyers. It’s the way projects are marketed to Asia and it’s also happening because of word of mouth.”

Dispelling the speculation myth, buyers from China are also putting down roots in the city and opening up businesses seemingly en masse.

“The commercial space around Ste. Catherine, Guy , and Saint-Matthieu Sts. has changed a lot,” continued Assaad. “There are ice cream shops, tea shops, hair salons—everything opening up and the business operators are people from China who are buying homes in the city. The commercial spaces in the whole area up to Atwater Ave. have Asian business owners. They’re coming and investing in condos, but they’re also investing in businesses.”

According to Juwai.com, a real estate website catering to Chinese buyers seeking international properties, the foreign buyer taxes in Canada’s two most active markets have been a boon for Montreal. Through the first quarter of 2018, there has been a 63% increase in enquiries about the Montreal market compared to the same period last year.

“Some of this fast Chinese demand growth is from buyers turned away from Vancouver and Toronto,” said Carrie Law, CEO and director of Juwai.com. “Other buyers are attracted to Montreal because of its fast-paced market.”

The trope that all Chinese buyers are wealthy plunderers is also a proven fallacy, added Law.

“The high net worth Chinese buyers in the Lamborghinis are the most visible, but the larger number are simply middle-class by Canadian standards,” she said. “The wealthy are like everyone else; they try to buy the best they can afford, they compare their options, and they don’t like to overpay if they can get a similar home and lifestyle in another market for less.”

However, heightened interest in Montreal doesn’t mean Toronto has become an afterthought for Chinese buyers, largely due to the fact that Toronto has stronger fundamentals that even a resurgent Montreal cannot supersede.
“Montreal is a wonderful destination that deserves a good deal more international investment than it now receives,” said Law. “Toronto has demand drivers that won’t disappear, including the English language, educational system, and job market.”