Majority of Canadians Support Foreign Buyer Tax
According to a new poll conducted by Zoocasa, a majority Canadians across the country support the adoption of a new foreign buyer tax at a national level. Such information comes at a time where more and more cities are starting to publicly ponder the adoption of a foreign buyer tax in an effort to prevent an uncontrollable rise in property prices. This has most notably occurred in Toronto, after Ontario’s Liberal Premier Kathleen Wynne announced the adoption of a foreign buyer tax that would be instituted within the Greater Golden Horseshoe region.
Interestingly, the polling company found that the idea of a national foreign buyer tax found the most support in the province of Quebec, where over 77 percent of the population signalled a support of such a measure. Yet, just over sixty percent of those surveyed agreed with the notion that foreign investment activity was responsible for inflating local property prices. The second highest support level was found in the province of British Columbia with 75 percent of respondents supporting the idea.
Such results are not surprising, given current market trends. In recent years, the property market within British Columbia has experienced an explosion of foreign buyer activity in the region. This activity has so heavily inflated local property prices in places such as Vancouver to the point where the provincial government implemented a provincial foreign buyer tax of fifteen percent within the Metro Vancouver Area in an effort to cool the market and ensure that home prices remain affordable for local residents. Meanwhile, market activity is slowly but surely ramping up in Quebec, where places such as Montreal are starting to see increased level of sales from both foreign buyers as well as property speculators due to relatively low home prices compared to desirable cities such as Toronto and Vancouver.
Yet, despite the general acceptance by Canadians when it comes to a foreign buyer tax, the polling company also found that many Canadians are ill equipped from a financial perspective when it comes to being able to save enough money to pay towards a down payment on a home. According to the company, less than half of respondents claimed that they managed to save only $5,000 (out of an national average of over $27,000 needed for a five percent down payment), with less than twenty percent claiming that they have saved between $20,000 and $40,000 for a down payment. In such circumstances, it is unclear whether a foreign buyer tax would be enough to prevent excessive home price inflation.
Published Date: Jun 07 2017