Over half of Canadian estate agents predict a rise in foreign demand in the the coming year. Canada joins Australia and New Zealand as a nation concerned about the number of overseas buyers snapping up real estate supply. While the size of the foreign investor market is relatively small in both New Zealand and Canada, though, Canadian agents expect demand to climb.
67 per cent of respondets to Royal Lepage’s report say that foreign buyer activity has increased in their region since January 2015, while one in four say that at least one-quarter of luxury homes in their area are purchased by buyers overseas.
Looking ahead, 6 in 10 anticipate foreign investment to rise, with 51 per cent naming China as the main group of buyers.
Phil Soper, President and Chief Executive Officer of Royal LePage, says: “While the impact of foreign buying on Canada’s overall residential real estate market is small, we see it growing in importance in the luxury market. Canada’s stable political and financial systems, along with a tradition of cultural tolerance and openness to immigration and diversity, make our country an ideal destination for wealthy international purchasers looking to invest in real property. Recently, a lower Canadian dollar has made this proposition even more attractive.”
Foreign buyers make up 1 in 10 Canadian property sales, as Generation X dominates
27th June 2016
Foreign buyers make up just 1 in 10 sales of recreational property in Canada, according to a new report, as Generation X buyers dominate activity.
The research by Royal LePage shows that Generation X buyers outnumber Baby Boomers by almost two to one (accounting for two-thirds of sales, compared to one-third). Nonetheless, planning for retirement is among the most common reasons buyers give for buying property in the country.
Almost nine in 10 respondents said that buyers were looking for lifestyle and vacationing reasons, with two-thirds highlighting retirement needs as their reason for purchasing. 37 per cent said that low interest rates is a factor.
Almost 95% said that foreign buyers made up 10 per cent of less of their recreational property sales. Buyers are mostly from North America (79 per cent), with the majority of them (64 per cent) Americans. The reasons for investing from overseas include Canada’s quality of life (3 in 10), its location (27 per cent) and the weak Canadian dollar (27 per cent).
“We Canadians enjoy a wonderful recreational real estate reciprocity with our American cousins. Like flocks of happy geese, we fly south in the winter, and in return, Americans head to the beautiful north country when summer arrives. Canadians have been, for years, the principal foreign buyers of sunbelt property in states like Florida and Arizona, while a lower Canadian dollar has encouraged a new wave of US buyers here,” says Phil Soper, president and chief executive officer of Royal LePage.
“Whether recreational property buyers live in Canada or come from abroad, the beauty of this country, from coast-to-coast, is the appeal for families looking to ‘get away’ and enjoy the cottage experience, one that is quintessentially Canadian.”
Soper says that Generation Xers’ activity, despite retirement being a common factor behind purchases, “is making recreational property purchases for family enjoyment in the near-term and as a key strategy for retirement”.
“Canada’s extended low interest rate environment has clearly provided buyers with the confidence they need to invest in a cottage or cabin,” he adds.
Two-thirds of the respondents in total said that they have seen property sales increase in the last year, with over half forecasting sales this year to exceed last year.Google+