Foreign buyers may have less of an impact on B.C.’s housing market than previously thought, according to a new report from B.C. Notaries.
In November, the society surveyed 133 of its members on key real estate topics, including the perceived influx of foreign buyers. The report found that only five per cent of all residential real estate transactions managed by B.C. Notaries across the province were from foreign buyers.
The report’s release comes as the provincial government considers taking measures to combat the high cost of housing in B.C.
“Our survey results, which indicate that the vast majority of real estate purchases in B.C. are made by B.C. or Canadian residents, points to the need for careful consideration of any related legislative changes,” said B.C. Notaries president Tammy Morin Nakashima in a statement.
While the report shows foreign buyers representing seven per cent of residential sales in Greater Vancouver, Island-based notaries reported only two per cent of their transactions came from buyers outside the country.
Additionally, while foreign buyers made up more than half of the clients for a few notaries in the Lower Mainland, the 20 notaries surveyed on the Island said foreign buyers made up no more than 10 per cent of their business.
“We haven’t seen a marked increase at all in foreign buyers,” Laurie Salvador, a notary with Salvador Davis and Company in Sidney. “We generally have maybe just a handful a year – maybe under six – and that hasn’t changed in many years.”
According to the report, the Island’s housing market has more in common with the Fraser Valley or the Okanagan, with lower foreign ownership compared to Vancouver. But despite the small numbers, 39 per cent of Island notaries reported an increase in foreign buyers, not far from 42 per cent of Greater Vancouver notaries.
Nonetheless, Salvador said the provincial average of five per cent shows that foreign sales are not making a significant dent in B.C. real estate markets.
“If it’s five per cent, that means 95 per cent of the people either live in British Columbia or somewhere else in Canada, and that says a lot about the health of our economy and the desire to live in British Columbia,” she said. “People want to live in British Columbia because we have so much to offer. It’s British Columbia that is the attraction.”
Rather, Salvador attributed the ongoing increase of house prices on Vancouver Island to such factors as a lull in development over the last five to seven years, creating an issue of supply and demand.
She noted the low ownership numbers should be studied by the provincial government as it determines if legislation is appropriate to address housing affordability.
“When we’re talking about government possibly imposing taxes for that, I’m sure they will discuss this with all the various players and make a wise decision if they feel that’s necessary. But it wouldn’t be a huge moneymaker if it’s only five per cent of the real estate, and it might deter people,” said Salvador.
“We certainly don’t want to discourage people that can afford to purchase in British Columbia. I think what people are afraid of is that those buyers are driving up prices, but I don’t think that’s the case at all.”