In a report by Matt Meuse for CBC News
, Tal said that the current discourse surrounding foreign ownership of Canadian real estate is apparently ignoring the fact that the in-demand cities—Vancouver, in particular—are currently suffering from a dearth of property listings
“We are trying to fight supply issues with demand solutions,” Tal said.
“Vancouver is an island ... from a real estate perspective,” he added. “In Vancouver, you cannot deal with the supply, but you can deal with speculative aspect that the supply issue create.”
Tal clarified, however, that “properly designed” taxes on foreign real estate speculators would still be a good starting point in moderating the Vancouver market without risking a meltdown. Such taxes would target individuals who purchase homes only for income generation purposes, without planning to reside on them and work in Canada.
“We don't want to say that Canada is not accepting foreign investment — absolutely not. But some of them are doing it just to make quick money,” Tal explained. “This is basically speculative activity. Therefore, let's tax this activity.”
Additional taxation on overseas investors would not be sufficient in addressing the “fundamental” problem of supply plaguing Canada’s most overheated housing markets, according to the CIBC’s Benjamin Tal.