Canadian consumers are being driven out of the real estate markets in many of the nation’s largest cities by offshore real estate buyers.
Toronto real estate mogul, Brad Lamb, said, “If you want to live in central Toronto, you’re going to have to live in a condo, or be a millionaire. That’s the reality. It’s not a bad thing. It’s the way cities evolve.”
In particular, single detached homes have seen the highest competition. For example, CBC reported that a 1960s era three-bedroom bungalow in Willowdale, Ontario, with little updating, was listed at $759,000. It sold for $421,800 over the asking price. The winning bid, of $1,180,800 was from a university student, whose parents live in China and own a business in San Francisco.
There were four other bids, all of them for more than one million dollars. But Steve Matthews, a Re/Max agent in north Toronto, says that the inflated prices, like the price paid for the bungalow, make it difficult for ordinary Canadians to get into the market, no matter who buys the house. He says, “It skews the market. How does ‘Joe Normal’ ever compete with that?”
Tony Ma, owner of HomeLife Landmark Realty in Markham, sold 263 homes, each more than $1 million, with about 40% being all-cash deals with no conditions, just in the last year. He said when his clients (primarily from the far east) see the quality and finish of an $8 million house here, they think the price is cheap.