National Bank of Canada economists Parham Fini, Paul Poon, and Peter Routledge said that the allocated funding, while consisting only 27.5 per cent of the average cost of a detached property in Greater Vancouver (approximately $1.8 million), is sufficient for Statscan to take the first step in gathering information on a “politically delicate” issue.
The group added, however, that provincial and municipal governments should also incorporate “their financial resources” to the data collection efforts, as these institutions have access to updated material regarding their respective real estate markets.
Meanwhile, in the absence of federally approved methodologies, the economists went ahead with their own study. Their research revealed that Chinese capital accounted for approximately $12.7 billion worth of homes purchased in Vancouver in 2015, representing 33 per cent of overall sales volume in the region. Meanwhile, the Greater Toronto Area saw $9 billion in residential transactions from Chinese buyers last year, or 14 per cent of total regional sales.
Data used in the study was culled from a report by the National Association of Realtors, which looked into overseas real estate investment in Canada, as well as a survey of rich Chinese investors conducted by the Financial Times
The approach used in the research stressed the need for a more refined method that would pull together more useful and accurate data on the effects of foreign ownership in Canada’s real estate markets, the economists said. A “back-of-the-envelope attempt at gauging the significance of capital inflows from mainland China on the local residential real estate markets in Toronto and Vancouver” won’t be sufficient for this purpose, the group told The Globe and Mail
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The 2016 budget released by the Liberal administration last week included a $500,000 tranche for Statistics Canada, which would allow the organization to develop better data collection methods over a period of 12 months—a move that is expected to help authorities better understand the role of foreign capital in the country’s housing markets.