Foreign Buyers: A Limited Part Of Montreal Property
Recent data from Canada’s national housing agency (CNHA) confirms that foreign buyers are pushing into Montreal’s real estate market in large, increasing numbers but they are still a limited part of it.
About 235 foreign buyers bought property in the Montreal area from January to April this year, this is a 40-per-cent increase compared to the first four months of 2016, the Canada Mortgage and Housing Corp. (CMHC) said in a research note Thursday.
These increases are large in percentage terms there is a continued interest by people outside Canada in Quebec’s largest city. But they are smaller when considered as part of the wider market, with 235 buyers representing just 1.8 per cent of all residential real estate transactions.
The housing agency said, “A slight shift in demand from Vancouver to Montreal may have occurred after the introduction of the foreign buyers’ tax on housing in Vancouver”.
According to the Québec Federation of Real Estate Boards, prices in Montreal increased by 6 per cent in May compared with the same month last year and sales volume set a record for the month with 15-per-cent growth. The federation says Montreal’s market is driven by a demand from local buyers in an economy with record low unemployment and low interest rates and not by foreign-based purchasers.
Buyers from the United States and France still form the largest foreign buyers in Montreal, according to the CMHC data. The housing agency also noted that the number of Chinese buyers in Montreal more than tripled to 100 over the eight-month span after Vancouver’s tax was introduced compared with the same span the year before.
Condominiums are still the first choice of property type for foreign investors in Montreal, the CHMC said. Chinese buyers were more inclined than buyers from the United States and France to opt for single-family homes.
