Foreign interest in apartment sector unchanged: report

National activity down from 2015, but consistent with 2014, says CMHC

Foreign ownership of condominium-style apartments in Calgary this year is unchanged from a year prior and continues to represent a small proportion of the total market, according to a new report.

In a recent briefing, Canada Mortgage and Housing Corp. (CMHC) noted foreign buyer activity in the city’s apartment sector represented 0.9 per cent of all activity in 2016. That’s down from 1.1 per cent in 2015, but up from 0.2 per cent in 2014.

The national housing agency based its findings on its 2016 Condominium Apartment Survey, which is used as a means to assess the residency status of condo apartment owners in major Census Metropolitan Areas (CMAs) across Canada.

“Foreign ownership is just one factor influencing Canada’s housing markets, but it’s an important one that continues to gain attention.”

Elsewhere in Canada, CMHC noted the share of foreign ownership in condominium apartments remained low in the CMAs surveyed, peaking at 2.2 and 2.3 per cent in Vancouver and Toronto, respectively. This represented a decline from the shares registered in 2015, leaving shares roughly in line with results in 2014.

“Foreign ownership is just one factor influencing Canada’s housing markets, but it’s an important one that continues to gain attention,” said the study’s authors Andrew L. Scott, senior market analyst, and Francis Cortellino, principal market analyst with CMHC.

For the purposes of this study, CMHC defined a foreign resident as a person whose primary residence is outside of Canada.

Scott and Cortellino attributed the relatively higher shares observed in 2015 to an unusually high proportion of foreign ownership in newly constructed condominiums that year, relative to 2014 and 2016.

Elsewhere in Canada, where the condominium apartment stock was smaller, the share of foreign owners ranged from a low of 0.2 per cent in Saskatoon and Regina to a high of
1.2 per cent in Halifax.

CMHC also noted foreign ownership was highest among newer and larger buildings in urban cores.

“A significant increase in the construction of condominium apartments in recent years warrants a closer look at foreign ownership by age of structures to examine if foreign buyers play a larger role in newer condominium projects,” said the study’s authors.

“Our studies show that the share of foreign ownership remains low and concentrated in newer, larger buildings located in the cores of major cities like Vancouver, Toronto and Montreal.”

Calgary’s housing market has traditionally been overshadowed by other Canadian cities because of location and accessibility, said ATB Financial chief economist Todd Hirsch.

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