Foreign owners are buying up a sizable chunk of Vancouver condos, according to a survey conducted by the Canada Mortgage and Housing Corporation (CMHC). At the same time, people living outside the country have purchased a significantly smaller number of properties than other recent studies suggest.
According to the 2015 CMHC “condominium apartment vacancy survey”, 5.4 percent of City of Vancouver apartments went to foreign owners during the year preceding the fall survey.
For the greater region that CMHC considers Vancouver (roughly the Lower Mainland), that number was 3.5 percent. That’s up from the previous year, when 2.3 percent of condos sold in the Vancouver region went to foreign owners.
“The results of the fall 2015 survey indicate that the shares of foreign ownership in condominium apartments remained low in the 16 CMAs surveyed,” CMHC senior economist Felicia Mutheardy said quoted in the report. “While this provides insight, more information is needed on foreign ownership and investment in Canadian housing markets.”
The City of Vancouver’s 5.4 percent of condos going to foreign owners compares to 5.8 for Toronto Centre and to 4.9 percent for downtown Montreal.
The report describes a “foreign owner” as someone whose primary residence is outside of Canada.
“One of the challenges associated with measuring foreign ownership is the definition of a foreign resident,” it continues. “For example, should immigrants and non-permanent residents who reside permanently in Canada be considered foreign residents? After reviewing definitions used in studies in other jurisdictions, CMHC concluded that a definition based on country of residence (as opposed to nationality) is most appropriate in the context of assessing foreign ownership. For the purposes of this study, therefore, CMHC defines a foreign resident as a person whose primary residence is outside of Canada. It should be noted that this definition includes Canadians whose primary residence is outside of Canada.”
It emphasizes the term “foreign owner” is not interchangeable with “foreign buyer”.
The report goes on to discuss at length recent attempts to quantify the impact of so-called foreign buyers and media coverage of those efforts.
“A lack of accurate and reliable data makes it difficult to determine if or how foreign ownership may be affecting housing markets,” it begins. “Although most of the information available is anecdotal, some studies have been undertaken. A survey of realtors conducted by Sotheby’s in 2013, for example, indicates that international buyers accounted for 40% and 25% of total luxury home sales in Vancouver and Toronto, respectively. More recently, Andy Yan, an urban planner and Adjunct Professor at the University of British Columbia, released a study indicating that approximately 65% of luxury homes sold in three neighbourhoods in Vancouver between August 2014 and February 2015 were to buyers with non-anglicized Chinese names.
“While questions have been raised about the methodology and sample sizes used for such studies, they raise some interesting points that merit further research.”
The CMHC report concludes that “significant data gaps continue to exist on foreign ownership and investment in Canadian housing markets”. It states the organization is exploring new ways to access additional data related to the issue.