The desire for Americans to flee the Trump presidency reign over their country for the next four years is attracting interest in Canadian real estate.
Data collected from U.S.-originated clicks on Royal LePage website listings surged 329 per cent the day following the U.S. presidential election and climbed 210.1 per cent year-over-year for the week following Trump’s electoral victory.
Further broken down by region, those listings hits translated the most in Ontario followed by B.C., and the interest in our province was primarily Victoria and the Interior as opposed to the Lower Mainland.
“We didn’t see that kind of disproportion in Ontario. Toronto showed the highest interest. So what that would tell me in B.C. is potential buyers, in this case Americans, are looking away from Vancouver because of the cost of homes and the implementation of the 15 per cent foreign buyer tax,” said Phil Soper, the chief executive officer of Royal LePage, the largest real estate firm in Canada.
Soper said if those clicks will turn potential shoppers into buyers will become more evident after 90 days.
“With that kind of massive spike, there might be something there. But you don’t count a sale until the deal closes, not if someone looks at a property or even makes an offer. And that usually takes about 90 days as a good rule of thumb to follow,” Soper said.
He said Americans are typically looking for recreational properties, but the interest in urban properties based on Royal LePage website listings searches may indicate more permanent residences are desired.
“The interest reflects perhaps more people are thinking about relocation rather than a holiday environment opportunity,” said Soper.
“Canadians buying property to snowbird in the winter and Americans coming up here to buy recreational property is pretty common, so time will tell if this bump in our page view listings indicates a change from the U.S. buyer perspective.”
He added that their website tracks Internet protocol addresses, so there is no absolute knowledge that a hit from San Francisco or New York City is necessarily an American, just the address where the inquiry originated from.
Soper said the Lower Mainland housing market continues to have a big influence on real estate activity elsewhere across the province.
He argues the foreign tax measure invoked last summer had the wrong impact, as transactions fell 40 per cent in volume after the tax was adopted, while even the most bullish estimates show foreign buyers made up only 10 per cent of the buyers’ market.
“A lot of people stopped buying, not just foreigner buyers, and I think that’s why the government brought in the first-time home buyer initiative, to pave over the political damage caused by the slowdown in the market,” Soper said.
“What I always tell people in comparing the difference in housing prices on our two coasts, in Moncton (New Brunswick) you can buy eight two-storey benchmark price homes for the same price as one home in Vancouver. Now today, that has climbed to 11 for the price of one in Vancouver.”