Foreign ownership of real estate rises in Montreal, new data shows

Montreal has seen a notable increase in the number of foreign buyers this year, suggesting investors from outside Canada may be shifting their focus to Quebec's largest city after crackdowns in Toronto and Vancouver.

The non-resident share in Montreal climbedfrom 1.1 per cent in 2016 to 1.7 per cent in 2017, according to a report by Canada Mortgage Housing Corporation (CMHC) in collaboration withStatistics Canada.

Downtown and Nuns'Island reported the largest increase in the Montreal area, up from 4.3 per cent in 2016 to 7.6 per cent this year.

BobDugan,CMHC'schief economist, said the lack of increase in the rate of foreign buyers in TorontoandVancouver, combined with the jumpin Montreal, indicate interest is shifting away from Ontario and British Columbia.

Amid concerns over skyrocketing homeprices,Ontario introduced a tax on foreign buyersin Torontoearlier this year, whileBritish Columbia did the same forVancouver in 2016.

Duganadded that other factors likely played a role in the increase in foreign buyers,includinglower housing prices and a relatively strong economy.

The percentage of non-resident-owned property remains relatively low in Montreal, however, compared to Toronto, where it is 3.4 per cent,and Vancouver, where it stands at4.8 per cent.

Foreign ownership is evenhigherin Vancouver's centre, where non-resident ownership accounts for7.6 per cent of the total residential real estate sold.In downtown Toronto, it accounts for 4.8 per cent.

Unable to meet demand, realtor says

Chinese buyers account for the bulk of Montreal'srecent increase in foreign buyers. In 2017, 21 per centwere from China, compared to 10 per cent in 2016.

DebbyDoktorczyk, a partner withEngel & Vlkers Montral, said the change has been noticeable on the ground.

"We're definitely seeing a lot of Asian buyers," she said, addingthat in some large condo projects downtown, the buyers are almost exclusively from China.

Her firm now hasseven brokers to deal with the increased demand, compared to only one a year earlier, and they still aren't able to meetthe demand, she said.

Time for a tax?

Montreal MayorValriePlantehas repeatedly pushed for the power tobe able to introduce a foreign buyers'tax in her own city.

However, she requires the approval of the Quebec government, which has so far deemed such a move unnecessary.

She told reporters Tuesday the report is further evidence the city should have the ability to do so.