The search on Greater Toronto Area real estate by investors from China has been on the increase since Vancouver introduced a tax on foreign buyers which limited their participation in the market. This led many of such buyers to move to other markets and Toronto was a big attraction for many.
However, what has been surprising for market onlookers is the fact that searches from online buyers is yet to take place. Most Chinese searches are prompted by the wish to reside in the area and also find schools.
A report by Sotheby’s International Realty goes to explained that last year, Chinese buyers accounted for only 4.9% sales in Toronto which many real estate investors and experts where doubtful about as a result of the low figure.
But according to Sotheby’s CEO Brad Henderson, the reason why the online searches have not materialized is because there is little data on foreign buyer’s activity, hence people get information from other unreliable sources which in most cases are not verifiable information.
Residents are getting irritated as home prices are rising above their monthly earnings which is making homes more expensive particularly for first-time buyers.
The same situation occurred in Vancouver and residents blamed one sect of buyers for these price increases: foreign buyers. But Toronto is experiencing more and more of what took place in Vancouver and there is yet to be measures taken to control the growing home prices.
The reasons behind Chinese investors wanting to buy in the Great Toronto Area proposed by the Toronto Real Estate Board is different from that suggested by Sotheby’s report.
Yet, Chinese real estate hub Juwai.com conforms that majority of Chinese investors are driven by the desire to purchase real estate as their primary residence to gain access to Canadian schools.
Data from Juwai.com also shows Chinese searches on Toronto homes are within the average price of $428,928 which is quite lower than the average home price in Toronto which stands at $740,685.
This reason factor diverges from the claims that Chinese buyers have eyes on expensive homes.
The data brings to light the actual interest of Chinese buyers in the Greater Toronto Area real estate market and even though Canadian agents were aware of the fact that Chinese buyers are interested in Canadian schools, they however did not know how important it was for them.
The data also went on to highlight that that tax on foreign buyers in Vancouver made many to search for homes in Toronto in the Q3.
As home prices in Toronto became the highest in Canada with the average exceeding $1 million, Sotheby however does not attribute this to foreign buyers but suggests that the growth was fueled by the growing interest of local residents in the area’s education, friendliness to immigrants and investments.