Montreal could see increase in foreign buyers

The plan to tax foreign buyers in Ontario could lead to an increase in their interest in Montreal, the Québec Federation of Real Estate Boards says.

The organization says that it does not expect a large impact on the market though, highlighting that foreign buyers are only 1.5 per cent of the buyers in Montreal according to CMHC data.

"Activity by foreign buyers in the Montréal area could have an upward impact on property prices in some central neighbourhoods, as this is where they tend to concentrate their purchases," explained Paul Cardinal, Manager of the QFREB's Market Analysis Department. "However, the impact would be limited given that Montréal's real estate market conditions are very different than those observed recently in Toronto and Vancouver."

The market is also not experiencing the tight supply conditions seen in Toronto and Vancouver which have led to price surges. Montreal median prices for single-family homes and condos have risen just 6 per cent over three years (2013-2016).

Meanwhile, the market’s rental vacancy rate is 3.9 per cent, three times that of Toronto and more than five times that of Vancouver.

"We are far from a housing shortage, whether it be the resale, new construction or rental markets. In this context, it is difficult to envisage a surge in prices like Toronto," added Mr. Cardinal.

MBN

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