Talk of a foreign buyer ban is growing louder, but sales agents in Canada’s two most expensive real estate markets think an interdiction on non-resident buyers is both regressive and pointless.
Sunny Sharma in Toronto noted that Canada is a country of immigrants, and that the sharp rise in housing prices cannot be explained by foreign buyer activity alone—or even at all.
“I think a ban is absurd,” said the president and co-owner of Leading Edge VIP. “Foreign buyers are such a small percentage of buyers when you look at the whole market. It’s unfortunate that prices are going up, but they’re relative to Eastern and Western Canada, as far as where population migrates. As a person who owns real estate and has invested in real estate, although foreign buyers are about 5% of all transactions, I don’t think they make a significant impact on the total market like they’re made out to in the media.”
Sharma warns that closing borders could stunt growth in our country because most non-residents who buy real estate in Canada also live and work here. As a brokerage owner, he can attest to how miniscule the number of foreign buyers in Toronto is.
“I think if we close our borders, there’s not going to be any growth for our country,” he said. “From a broker’s perspective, sure we want to see activity taking place in the market instead of it being stagnant, but I don’ believe foreign buyers are a large enough demographical group to make that impact. In a whole year, out of all the transactions I do, I’d be lucky to get one or two foreign buyers. That’s just me personally, but I’d say five percent of our brokerage’s transactions are foreign.”
REMAX sales agent Ron Antalek says that even in Vancouver, where he works, the number of foreign buyers isn’t commensurate with the uproar their presence has created.
“We study the number of foreign buyers and it’s insignificant,” he said. “The foreign buyer consists of less than 5% of the market. We had 103,763 residential sales in 2017 and that’s a decline of 7.5% from 112,211 in 2016, so we already have a decline in the market, and banning a foreign buyer will not change the fact that we are a desirable province to live in. Vancouver is desirable, and even if you ban foreign buyers, you won’t diminish demand. Interprovincial migration is also putting pressure on the urban centre of Vancouver.”