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Non-resident ownership of condo apartments remains low

Tuesday, December 19, 2017

According to a new report from CMHC, the share of condominium apartments owned by non-residents remains low in the 17 Canadian Census Metropolitan Areas (CMAs) surveyed, with the majority reporting shares of less than 1 per cent. Non-resident ownership shares remained stable in Vancouver and Toronto, while Montreal saw an increase.

“The share of condominium apartments owned by non-residents remained low and stable in Canada,” said Bob Dugan, Chief Economist, Canada Mortgage and Housing Corporation. “The lack of growth in Toronto and Vancouver, combined with the increases in Montréal, indicate the possibility of a shift from these centres after the introduction of foreign buyers’ taxes in Ontario and British Columbia. Other factors attracting demand to Montréal include lower housing prices and a relatively strong economy. It should be noted that foreign ownership is just one of the factors influencing Canada’s housing markets. Other important factors include housing and land supply constraints as well as the economic and demographic fundamentals that drive housing demand.”

CMHC and Statistics Canada both define a non-resident homeowner (often referred to as a “foreign homeowner”) as an individual whose principal residence is outside of Canada. “Foreign ownership,” in this case, technically refers to the non-Canadian residency of the legal owner of the property, irrespective of the owner’s nationality. It should be noted that this definition would classify Canadian citizens whose primary residence is outside of Canada as “non-resident.”

2017 CHMC report highlights

• Toronto, Vancouver, Montréal, Halifax, Victoria and Gatineau have non-resident ownership shares above 1% of the condominium apartment stock.
• Montréal saw an increase in the share of non-resident ownership of condominium apartments, rising from 1.1% in 2016 to 1.7% in 2017.
• Downtown Montréal and Nun’s Island reported the largest increase in the share of non-resident owners, from 4.3% in 2016 to 7.6% in 2017, followed by Montréal Island (from 1.7% to 2.7%) and West of Island Montréal (from 0.9% to 1.5%).
• In Toronto, the largest structures registered a non-resident ownership share of 4.2% compared to the overall share of 2.5%, Vancouver registered a share of 3.3% in the largest structures versus the overall share of 2.2%, while the CMA of Montréal registered a largest-structures share of 3.7% vs the overall share of 1.7%.

CMHC and Statistics Canada partnership

In order to address the data gap on foreign ownership in Canadian residential real estate, CMHC began collecting information in 2014 on the non-resident share of ownership in condominiums via its Condominium Apartment Survey. CMHC has produced estimates for selected major centres, including Vancouver and Toronto. In Budget 2017, the Government of Canada provided funding to Statistics Canada to improve housing data through the CHSP. These efforts have resulted in Statistics Canada publishing its first estimates from the CHSP focusing on non-resident ownership for Vancouver and Toronto.

 

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