Hey, Chinese home buyers: Welcome to Seattle (and forget Vancouver)
Hey, Chinese home buyers: Welcome to Seattle (and forget Vancouver)
Exodus to other North American cities after foreign home buyers face levy in Vancouver
Now that the British Columbia government has given Chinese buyers second thoughts regarding residential properties in Vancouver, other North American cities are rising up to take its place.
Previously a top choice among Chinese investors, inquiries in Vancouver fell 81 percent in August from the same month last year, data from Chinese property portal Juwai.com showed.
At the same time, Seattle reported a humongous spike in interest from China. Rated the number one city in North America for inquiries on Juwai.com, the Washington capital saw inquiries for homes shooting up by 143 percent. Similarly, property inquiries in Toronto ascended a staggering 142 percent in the same period.
More: This Toronto neighbourhood has become a magnet for Chinese buyers
The exodus to other North American cities seems to vindicate the British Columbian government’s decision in August to start requiring an additional 15 percent in property transfer taxes of foreign buyers. However, Vancouver has been losing local and overseas buyers all year, said Matthew Moore, president of the Americas for Juwai.com. “The shift to other cities has actually been going on for months, with buyer demand momentum shifting to other cities with similar appeal but lower entry prices.”
Toronto’s attractiveness to foreign property investors may be cut short soon though. In an op-ed for the Financial Post, former finance minister Joe Oliver urged the Ontario government to charge a 15 percent tax on non-residents and foreigners acquiring residential property in certain Greater Toronto Area communities. “Increased foreign buying is going to exacerbate an overheated real estate market, to the detriment of all Torontonians and at risk to the broader economy,” he said.
Vancouver has been topping the hottest-of housing market indices recently. Washington is not far off, with Chinese buyers splurging on USD1.6 billion worth of real estate in the state last year, according to the US National Association of Realtors.
Read next: Vancouver home sales fall — should the new tax on foreign buyers take credit?
Source: Property Report