Foreign Buyer Tax Underlines Pre-Existing Trends in Vancouver Housing Market

Multimedia content available

VANCOUVER, October 6, 2016 — Canada Mortgage and Housing Corporation (CMHC) released a Housing Market Insight (HMI) report on the impact of the BC Foreign Buyers Tax (FBT) on the Vancouver housing market.

On July 25, the BC Government announced the implementation of an additional property transfer tax of 15% on home sales to foreign buyers. While it is too early to determine the long term impacts of the Foreign Buyers Tax (FBT) on Vancouver’s housing market, preliminary analysis of resale data suggests the market was slowing down prior to the tax’s introduction.

 
Transcript

Foreground: Robyn Adamache, Principal Market Analyst, Vancouver, CMHC

Background: windows, office buildings

Robyn Adamache: “Foreign buyer activity is one of many factors impacting the Vancouver housing market and equally as important are housing and land supply issues as well as the economic and demographic fundamentals that drive housing demand. Sales and prices had already started to dip before the introduction of the Foreign Buyers Tax and so it basically underlined existing trends in the resale market.”

 

Report Highlights

  • Prior to the tax’s introduction, Vancouver was seeing a slowing pace of sales, an ongoing market shift to more condominium sales and a downward trend in average prices.
  • MLS® sales declined following the start of the tax, continuing an already established trend, particularly at the higher end of the price spectrum.
  • While MLS® HPI Benchmark prices have remained stable, the average price has declined, partly due to a change in the mix of homes sold.
  • Foreign buyers and/or foreign capital are among many forces driving home sales and prices in Metro Vancouver. Economic and demographic fundamentals, combined with housing and land supply constraints drive housing activity and home prices.

In order to access future Market Analysis Centre publications from CMHC, please subscribe to Housing Observer Online.

As Canada’s authority on housing, CMHC contributes to the stability of the housing market and financial system, provides support for Canadians in housing need, and offers objective housing research and information to Canadian governments, consumers and the housing industry.

Follow us on TwitterYouTubeLinkedIn and Facebook.

“Foreign buyer activity is one of many factors impacting the Vancouver housing market. Equally important are housing and land supply constraints as well as the economic and demographic fundamentals that drive housing demand. Sales and prices had already started to dip before the introduction of the Foreign Buyers Tax, so it basically underlined existing trends in the resale market.”

— Robyn Adamache, CMHC’s Principal Market Analyst for Vancouver.

Information on This Release:

Jeanette Wilkinson
CMHC Public Affairs
604-737-4007
jpwilkin@cmhc-schl.gc.ca

Additional data is available upon request.

CMHC Media Content Available for this News Release:

  • Video Clip — English (7,442 KB)
  • Robyn Adamache Headshot (37 KB)

Download this Media Package (ZIP – 7.30 MB)

Canada

Share...


Print(opens in a new window)