How the end of Canada's millionaire visa will hit the property sector

Canadian homes are among the world's most expensive - Vancouver ranks second-priciest behind Hong Kong, according to Demographia - but that has not put off Chinese investors, who number among the most prolific foreign buyers.

What may rattle them, though, is the sudden scrapping of an investor visa scheme via new legislation, which effectively stops top-end foreign property investment in its tracks.

The Immigrant Investor Programme, known as the "millionaire visa", was launched in 1986. It offered visas to foreign businesspeople with a net worth of at least C$1.6 million (HK$11.2 million), and who were willing to lend C$800,000 to the Canadian government for investment across the country, for a term of five years.

What followed was a flood of wealthy Hongkongers and mainlanders who snapped up properties for more than a decade. They were not the only ones: there were hitherto virtually no restrictions on foreigners buying properties in Canada and, while there appears to be no concrete data confirming the actual number of overseas owners, anecdotal evidence of their enthusiasm abounds, particularly in the desirable areas of Vancouver and British Columbia, and Toronto.

So popular was the Immigrant Investor Programme that it was temporarily frozen in 2012 due to a backlog of applicants. Reportedly, there were tens of thousands of applications waiting to be processed, 70 per cent of which were said to be from mainlanders who had lodged them in Hong Kong.

In February this year, while Canadians' eyes were on gold of another kind - "We were watching the [ice] hockey in the Winter Olympics," says Toronto real estate agent Victoria Boscariol - the government announced in its budget speech that the visa programme would be scrapped. Those in the queue would have their applications eliminated, and their fees returned.