Americans love Canadian real estate
Americans are increasingly enthralled by the idea of Canadian real estate since the election of Donald Trump, according to a new report released today by Royal LePage, one of Canada’s most prominent real estate services provider.
Turns out, American web traffic on Royal LePage’s website surged a phenomenal 329 percent on November 9, a day after the U.S. election. In fact, the number of Americans browsing through Canadian housing choices in the week after Trump’s victory more than quadrupled, rising 210 percent from the same time last year.
Royal LePage claims this trend continued for the rest of 2016, with American web traffic rising by about 40 percent in the last three months of the year.
“The United States was already a top source for immigration into Canada, and now in the period following the recent U.S. election, we are witnessing a material bump in American interest in Canadian real estate,” said Royal LePage President and CEO, Phil Soper.
Quite predictably, Ontario was the most-searched destination, with 41 percent of all U.S. pageviews directed at real estate in the province. According to the report, 62.5 percent of Ontario-based real estate advisors cited American interest in Ontario primarily around the Greater Toronto Area.
British Columbia ranked second in terms of American interest — 17.9 percent of all U.S. inquiries on royallepage.ca were for B.C. properties, mostly around Victoria. The intrigue in Victoria real estate could potentially be a result of the 15 percent tax imposed by the B.C. government last August on all foreign purchases of property in the Metro Vancouver area.
Canadian real estate has actually become one of the most sought-after investments in the world, to some extent contributing to the ever-increasing price of homes in Canada’s major cities. A 2014 study by U.K. property behemoth Grosvenor, ranked Toronto, Vancouver, and Calgary as the top three most resilient cities for long-term investment. The report, in fact, singled out Toronto real estate as an example of sound investment, saying the city’s long-term commitment to developing and upgrading infrastructure adds to its desirability.
It’s important to note however, that foreign ownership of Canadian real estate still remains low. A November 2016 report by the Canada Mortgage & Housing Corporation (CMHC) pegged foreign ownership of condominiums in Toronto and Vancouver (the highest concentration of foreign property purchases) at a mere 2.3 percent and 2.2 percent respectively — telling, but controversial statistics.
While American real estate (excluding the red-hot housing markets of New York, San Francisco, and L.A.) is still relatively inexpensive compared to buying a home in one of Canada’s urban centres, U.S. interest in our housing market could also be attributed to the weakness of the Canadian dollar. In the last three years alone, the loonie has lost almost 25 percent of its value relative to the U.S. dollar, vastly increasing American purchasing power for Canadian property.
“Given America’s vast population, even a fractional increase in the number of households following through on this initial interest could drive a material increase in the number of home-buyers from south of the border,” said Soper.
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Cover: The Canadian Press