Fewer Chinese prospective buyers are considering Vancouver properties in the Canadian province of British Columbia, following its implementation eight months ago of a 15% purchase tax on foreign residential real estate buyers.
Brad Henderson, president and CEO of Sotheby’s International Realty Canada, reportedly told local press that the province’s foreign buyers tax, which was levied for the first time in Vancouver, has scared off prospective Chinese homebuyers.
His remarks were based on a new study entitled China to Canada: International Home Buyer Insights, which was co-released in March this year by Sotheby’s (Canada) and Juwai.com, an international property website for Chinese buyers of overseas property.
According to the study, Chinese inquiries for listings in the Vancouver property market fell by 81% year-on-year in July 2016, the month the provincial government unveiled its 15% purchase tax on foreign buyers. The tax aimed to cool a regional housing market that saw extremely high prices and crisis-level shortages of affordable housing.
The drop in interest by Chinese prospective buyers fell throughout the remainder of 2016 while Chinese interest in Canadian real estate shifted to other major Canadian cities including Calgary and Alberta, with enquiries up by 1,050% and 420% respectively.