While Vancouver held its breath after Christy Clark announced the new 15% foreign investment tax, those in the business remained poker-faced. Sure, home sales dropped over the two or three months following; but a trained player knows it takes longer than that for the real estate market to reveal its hand. Buoyed by global crises, currencies as fickle as the governments who print them, and the most heated US presidential race in recent memory, BC real estate remains a sure bet for many foreign investors.
IT’S TIME TO BE HONEST…
Let’s be real for a moment, shall we? Yes, home sales in Vancouver dropped after the new foreign investment tax was ushered in. But did they remain that way? I’m afraid not. Personally, I have seen multiple bids starting to become a reality again within the condo market and I am getting more non resident clients. And while they don’t seem to be thrilled about paying the extra 15% tax, our drooping Loonie is still bringing them in. Not only that, as the most recent GVA home assessments clearly indicate, Vancouver is still increasing in value. A lot. We’re talking 45% in one year in some neighbourhoods. So, talk of a real estate bubble all you like, when in Rome…start selling houses to the Egyptians?
WHO’S COMING TO DINNER?
A lot of people are curious about the types of non-residents buying homes here in BC–particularly other non-residents. I can only speak from personal experience, but I have seen a spike in buyers from Europe and the US over the last 2-3 years. Not only that, at the end of January it was announced that the foreign investment tax will be lifted for foreigners who are here on a work visa, working and paying local taxes.
Over the last 12 months I have had the pleasure of doing business with both singles and couples from the United States, Germany, Britain, Saudi Arabia, Singapore, and other parts of Canada. Their impetus for buying real estate in BC is just as diverse as they are. From avid skiers looking to purchase vacation property in Whistler, to those looking for investment properties in the city centre; all have settled in BC for their own reasons.
I should also mention that I’ve seen an increase in dual citizens buying here in BC over the last few years. This is exemplified by a recent buyer from the UK who has a son enrolled at UBC. With the Canadian dollar quivering in the shadow of the British Pound, many feel like they are still getting a good deal all around.
GLOBAL UNCERTAINTY FUELING BC HOUSING MARKET
While it may not be fueling the BC housing market, financial and political uncertainty abroad sure is fanning the flames. In the last few months alone we’ve seen Britain exit the EU, a botched Italian referendum, foreign currency wars, and Donald Trump elected to office. It’s enough to keep anyone awake at night. And kidding aside, when you place Canada on the world stage it becomes obvious how stable we are in comparison. But it’s not only that.
The reality is that Canada is a safe nation. I mean that in every sense, too. As Malcolm Gladwell wrote in reference to his home country, Canada is, put simply, one of the most law-abiding, non-violent countries on earth. If you’re from virtually any other continent, particularly these days, you may be able to appreciate this even more than many Canadians do. The rate of violent crime in Canada is incredibly low. And while Vancouver struggles with issues of homelessness and substance abuse, it remains a very safe place to live. Added to that, Canada is a tolerant nation that encourages and safeguards religious and cultural differences. We are a mosaic, not a melting pot.
Economic investment in Canada is also safeguarded by fairly strict regulations. And these regulations are in place to avoid catastrophes of the 2008 US real estate housing meltdown ilk. We have tougher rules, and that can mean more elbow grease, but I’ll take it if it protects my clients and me. We may not be perfect, but, most of the time, our system works.
THE ROAD TO HOME OWNERSHIP IN CANADA
It can be a bit bumpy sometimes, but the right person will be sitting beside you the whole trip. If you’re looking for a co-pilot on your journey to homeownership in Canada, please feel free to contact me. I provide impartial advice and real-world experience.