Federal and provincial measures targeted at housing speculation will do little to improve affordability in Canada’s hottest residential markets, according to a new Bloomberg analysis that culled data from Teranet Inc.’s land and housing registry.
The latest numbers indicated that flippers represented only a miniscule proportion of home transactions in Toronto and Vancouver.
In Toronto, flipped condos accounted for a mere 1.8% of total sales for that housing type as of June 2018. This was far below the 4% rate a mere two years ago in April 2016.
Flipping “has always been a very rare occurrence” in Toronto, according to RE/MAX Integra regional director (Ontario) Christopher Alexander.
“Most people buy real estate to hang onto it for at least five to seven years,” Alexander told Bloomberg, adding that many short-term sales are due to life-altering factors such as sudden job changes.
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Meanwhile, in Vancouver, only 3.4% of condo sales between April and June were those of units that have been previously sold over the past year – a marked contrast from the 5% proportion back in March 2016, which was some time before B.C.’s implementation of the 15% tax on foreign home buyers.
A noticeable market slowdown between then and now has made condo flipping far less enticing than it was, according to realtor Steve Saretsky.
“As soon as [prices] stop rising you get into a number of issues,” Saretsky said in a phone interview. “Are you really going to try to flip it in a down market? There’s no profit to be made.”