“People are putting forward all these solutions on how to fix so-called foreign speculation, but we don’t even know if it’s really happening,” Kennedy Stewart, the NDP MP for Burnaby-Douglas in British Columbia told the Financial Post. “This really worries me, because you can really mess up your housing market if you don’t use the right mechanism.”
Many industry players believe foreign investment is inflating real estate prices and that more data is required to determine just how much overseas money is pouring into the market.
In late 2014, the CMHC contacted property managers in every condo structure that has three or more units – a list of contacts that has been used to ascertain vacancy rates for years – and leveraged those sources to get a glimpse of foreign investment numbers.
It defined foreign investors as owners whose primary residence isn’t in Canada.
The results of that survey revealed that foreign investment accounts for 1.1 per cent in Victoria, 2.3 per cent in Vancouver, 0.2 per cent in Calgary, 0.1 per cent in Edmonton, 0.3 per cent in Saskatoon, 0.1 per cent in Regina, 0.1 per cent in Winnipeg, 2.4 per cent in Toronto, 0.7 per cent in Ottawa, and 1.5 per cent in Montreal.
However, a CMHC rep admitted the data wasn’t perfect.
“Our main interest here is that foreign investors are one of those data gaps that everyone is wondering about and so we’re trying to do something to try to provide at least a piece of the puzzle,” Bob Dugan, chief economist at CMHC’s Market Analysis Centre, told MBN at the time. “So it’s probably not the perfect estimate of foreign investors and we’ll continue to work on this question but I think it’s a pretty good piece of information.”
Related: Exclusive: CMHC chief economist weighs in on foreign condo investment
More voices are joining the chorus calling for better data on foreign investment in Canada as home prices, especially in major markets, continue to sky-rocket.