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Canada extends ban on foreign home ownership to bolster affordable housing

Feb 6

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In a move to make home ownership more accessible to Canadians, the Canadian government has extended its ban on foreign home ownership for an additional two years. Experts said that the presence of foreign investors, coupled with an increase in migrants and international students, has significantly contributed to Canadians being priced out of the housing market, with home prices increasing by 36% since 2019.

The Toronto Regional Real Estate Board highlighted a 37% jump in home purchases over the last year, attributed in part to lower interest rates that have sparked a buying frenzy.

Deputy Prime Minister and Minister of Finance Chrystia Freeland emphasized the government’s commitment to ensuring that homes serve as living spaces for Canadian families rather than as speculative financial assets.

“By extending the foreign buyer ban, we will ensure houses are used as homes for Canadian families to live in and do not become a speculative financial asset class,” Freeland said.

However, the extension has faced criticism from within the real estate industry. Janice Myers, CEO of the Canadian Real Estate Association (CREA), called the move “baseless” and “completely unnecessary,” pointing out a lack of evidence to support the government’s stance on improving housing affordability through this measure.

Statistics Canada’s latest data from 2020 shows that non-resident investors owned 7% of condominiums in British Columbia, a province where condos have led the growth in the housing market, accounting for 54% of all new properties.

In conjunction with the foreign ownership ban, the finance minister’s office announced a new $200 million program aimed at supporting low-income renters and shelters, as rent prices continue to climb.

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[LAUREN TAYLOR]

IF YOU WERE HOPING TO BUY A HOME IN CANADA – THINK AGAIN. 

THE CANADIAN GOVERNMENT JUST EXTENDED ITS BAN ON FOREIGN HOME OWNERSHIP FOR TWO MORE YEARS.

OFFICIALS SAY IT’S ALL ABOUT AFFORDABLE HOUSING. 

THEY CLAIM FOREIGN INVESTORS, ALONG WITH A RISE IN MIGRANTS AND INTERNATIONAL STUDENTS, HAVE PRICED  SOME CANADIANS OUT OF THE HOUSING MARKET WHERE PRICES HAVE INCREASED 36% SINCE 2019. 

LOWER INTEREST RATES HAVE SPARKED A SURGE IN BUYING ACTIVITY. THE TORONTO REGIONAL REAL ESTATE BOARD REPORTS A 37% JUMP IN HOME PURCHASES COMPARED TO LAST YEAR.

CANADA’S FINANCE MINISTER ANNOUNCED THAT THE FEDERAL GOVERNMENT IS TAKING STEPS TO MAKE HOMEOWNERSHIP MORE ACCESSIBLE FOR CANADIANS. SAING IN PART:

CHRYSTIA FREELAND | DEPUTY PRIME MINISTER AND MINISTER OF FINANCE

By extending the foreign buyer ban, we will ensure houses are used as homes for Canadian families to live in and do not become a speculative financial asset class. 

[LAUREN TAYLOR]

THE GOVERNMENT CLAIMS THE BAN WILL ALLEVIATE CANADA’S SEVERE HOUSING SHORTAGE – BUT REAL ESTATE INDUSTRY CRITICS ARGUE IT’S MISGUIDED AND INEFFECTIVE. JANICE MYERS – THE CEO FOR THE CANADIAN REAL ESTATE ASSOCIATION – CRITICIZED THE MOVE AS ‘BASELESS.’ 

JANICE MYERS | CEO CREA

The newly announced two-year extension is completely unnecessary, considering the fact there is no analysis, evidence or data […] to support the government’s intended impact on housing affordability in Canada.

[LAUREN TAYLOR]

THE GOVERNMENT’S REPORTED AIM IS TO DISCOURAGE BUYERS WHO HAVE NO INTENTION OF LIVING IN THE PROPERTIES. 

LATEST DATA FROM STATISTICS CANADA FOR 2020 SHOWS THAT NON-RESIDENT INVESTORS OWNED 7-PERCENT OF CONDOMINIUMS IN BRITISH COLUMBIA. CONDOS LED THE GROWTH IN BRITISH COLUMBIA’S HOUSING MARKET, ACCOUNTING FOR 54-PERCENT OF ALL NEW PROPERTIES.

ALONG WITH PROHIBITING FOREIGN NATIONALS FROM BUYING PROPERTY IN CANADA, THE FINANCE MINISTER’S OFFICE ANNOUNCED ON TUESDAY A $200 MILLION PROGRAM AIMED AT SUPPORTING LOW-INCOME RENTERS AND SHELTERS AMID SOARING RENT PRICES.