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Canada’s home prices poised to decline … though not because of the ban on foreign homebuyers, analysts say
- Ottawa has implemented a two-year ban on non-domiciled foreigners buying homes
- But it is rising borrowing costs that will drive prices down, according to analysts
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Home prices in Canada – a destination favoured by Hongkongers – are likely to decline this year, according to analysts, as Ottawa implements a two-year ban on most foreigners buying homes.
Though the proscription was introduced with the aim of subduing a red hot housing market, it is unlikely to be the main factor bringing pressure to bear on house prices.
Instead, it is the sharp rise in interest rates that will dampen demand, according to analysts.
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For a period of two years from January 1, buyers not domiciled in Canada are no longer allowed to buy homes there. New immigrants and refugees, however, are exempted from the restriction.
The move is certain to come as bad news for offshore investors, including some Hongkongers, who have no ties with Canada.
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Hong Kong faces expat exodus as appeal of international city wanes
Hong Kong faces expat exodus as appeal of international city wanes
However, a rising number of Hong Kong residents are emigrating to the North American country or are seeking education there, meaning they will still be able to buy homes.
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