Foreign investment in Toronto is nearly negligible, according to a recent poll or real estate agents, but brokers aren't exactly sold.
“I would think most realtors would not want to report information that will (possibly result in) new taxes to slow down market,” MBN reader Derek Austin wrote in the MortgageBrokerNews.ca forum.
The Toronto Real Estate Board commissioned Ipsos, a third party research firm, to survey agents about the level of foreign purchasing activity throughout the GTA.
The survey collected over 3,500 responses and found an estimated 4.9% of foreign transactions in the GTA – with levels as high as 6% in York and Halton regions and as low as 1% in Durham.
In Toronto, the share of foreign buyers was 5%.
However, some industry players believe the number of foreign investors in the nation’s hottest housing market is much higher.
“The percentage of foreign buyers in recent years has been both underestimated and under-reported. The signs of this are obvious: a 16-17% increase in Toronto property values in one year? Does anyone really believe that the doubling, tripling and quadrupling of those huge condos along the lakeshore was created by thousands of Canadians all winning the lottery(s)?” Ronnie Kartman, president of WeRenovate.com said in the latest issue of CMP Magazine.
“Vancouver's immediate downward prices in response to the new foreign ownership tax points to price vulnerability for Toronto.
“If things start to even slightly go south, just watch how quickly they will want out. Shades of 1989-1992.”
Still, scepticism isn’t universal among those in the industry.
“The brokers and realtors with whom I am close represent greater than one billion dollars in annual transaction volume, we discuss foreign buyers periodically, and few see more than a single foreign buyer transaction per year,” Dustan Woodhouse
, a broker with Dominion Lending Centres
Canadian Mortgage Experts, told CMP. “Much of this topic’s coverage is based on anecdotes in which ‘new-to-Canada’ buyers are perceived (in sales centres) to be foreign buyers; an unfortunate error.
“Often missing from this debate is the consideration that foreign buyers built this amazing country’s colourful tapestry that we all benefit from: foreign buyers that spawned generations of Canadians.”