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The Feds Extend Ban on Foreign Buyers, and Canadians Leave Big City Life in Search of More Affordable Housing

This week’s top real estate stories.

By  Jared Lindzon | 2 minute read

Feb 9

Wahi's Week in Real Estate

Every Friday, Wahi brings you the most important real estate stories from the past week.

There’s Love, Then There’s Co-Ownership  

Not sure what to get your loved one this Valentine’s Day? How about a new home? It might not

leave much for flowers and chocolates, but it is likely to improve your bond. That’s because,

according to Wahi’s latest research, buying a home together is 10 times more likely to

strengthen a relationship than to cause it harm. Among the 77% of Canadians who made the

purchase with a romantic partner, most say they were aligned on key decisions like location and

property type. While 3% say buying together hurt their relationship, 34% report that it brought

them closer.

“Like geese in winter, Canadians are flocking away from the country’s most expensive housing markets in search of more welcoming accommodations.”

An Immigration Ban, Canadian Style 

Though Canada isn’t erecting a wall the country isn’t exactly rolling out the red carpet to non-residents, either. This week the Federal Government announced that it would extend the Prohibition on the Purchase of Residential Property by Non-Canadians Act — which prevents non-Canadians from purchasing residential property in the country — by an additional two years. The foreign buyers ban, which was initially set to expire in 2025, has now been extended to 2027. While the Act carves out exceptions for some international students, refugees and temporary workers CREA argues it does little to improve housing affordability for Canadians.

TRREB Predicts an Early Spring

The Toronto Regional Real Estate Board (TRREB) evidently did not catch a glimpse of its shadow because it’s predicting a quick end to the housing market freeze. In its latest report TRREB announced that the city saw a boost in sales activity in January, with about one-third more transactions than January of 2023, along with a slight uptick in listings. As a result, the Board says market conditions are tightening, with pent up demand ready to pounce at the first whiff of interest rate cuts. For the meantime, prices remain less than a percent lower than this time last year.    

Interest Rate Watch Party  

Step aside Bieber, Drake and the Weeknd, because Tiff Macklem has become Canada’s most watched celebrity. All eyes are on the Bank of Canada Governor as bankers, mortgage holders, and borrowers eagerly anticipate his next move. This week, Macklem dropped some breadcrumbs before the House of Commons, where he announced that rates could fall before the country achieves the Bank’s target inflation rate of 2%. He suggested the BoC would only entertain a cut once it has “assurance” that inflation is trending in the right direction. Bankers continue to anticipate an April rate cut, despite last month’s disappointing inflation data.

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Toronto’s Condo Market Is Imploding  

After years of bulldozing nearly every corner of the city to erect a condo, Toronto is finding itself with more supply than demand for the first time in a generation. According to a new report by Urbanation, new condo sales hit a 15-year low in 2023, dropping 41% compared to the year prior, representing the single biggest one-year decline since the 2008 financial crisis. Total sales also dipped below 13,000 units for the third time in 20 years, while new projects saw less than half of their units go to presales, down from 65% in 2022 and 82% in 2021.  

A Big Exodus from Big Cities  

Like geese in winter, Canadians are flocking away from the country’s most expensive housing markets in search of more welcoming accommodations. According to a recent study conducted by RE/MAX, higher taxes and borrowing costs layered on an already pricey real estate market are turning buyers away from cities like Toronto and Vancouver in favour of less populated corners of the country. In fact, nearly 60,000 moved to Alberta last year, alongside upticks in moves to Nova Scotia, New Brunswick, and Prince Edward Island. RE/MAX specifically blames land transfer taxes and new property assessments for driving the rise in internal migration.    

Jared Lindzon

Wahi Writer

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