Transparency International Canada, an anti-corruption agency claims that Statistics Canada “got it wrong” in a report they published last month that showed that foreign buyers are not are major part of Canada’s housing market.
For years now they have been keeping track and making aware to people about money laundering in the country’s real estate markets. It said that StatsCan might have made a mistake with the numbers concerning foreign ownership due to them not having the essential tools needed.
In the report StatsCan released last month, they stated that non-residents own about 3.4 per cent of all residential properties in Toronto and in Vancouver they take up about 4.8 per cent. Real estate insiders noted that those stats released about foreign home buying is not the main reason for house prices in Canada increasing.
James Cohen, the president of TI Canada recently told HuffPost Canada that “there’s no way to actually know what the total amount of foreign ownership in Canada is.”
One of the reasons for the problem is that in Canada people can keep their identity secret in shell companies if they want to. This is because in Canada it is not compulsory to reveal beneficial owners of companies.
Since most properties in Canada are owned by shell companies, the StatsCan will find it impossible to know exactly what foreign owners own in the Canadian real estate. The group noted last year that the government had no clue who owns half of the priciest properties in the city of Vancouver. At the moment it’s “only in Kenya and a selected few US states that is easier to set up an untraceable company than it is in Canada.”
In Canada, more rigorous identity checks are done for individuals getting library card than for those setting up companies. However, Statistics Canada knows about this problem and are doing all they can to figure out just exactly what’s happening in the housing market.
Haig McCarrell, the head of StatsCan’s new housing data mentioned to the Vancouver Sun that last month’s data released was “just the tip of the iceberg”.
McCarrell spotted some of the main problems in the data released. One of these is for example, if a shell company owns a home incorporated in Canada so they are counted as Canadian-owned in StatsCan’s data. However, Anik Lacroix, an assistant director at StatsCan’s investment, Science and technology division, states that they have more detailed data coming .
She told HuffPost Canada recently that “It is early stages” for the agency’s efforts in building a comprehensive picture of foreign ownership of housing. “I know everybody wants us to produce everything all at once, but we are just taking it step by step,” she added.