The impact of a foreign buyer’s tax on Vancouver housing is clearly being felt in neighbouring Victoria, Doug Porter, Bank of Montreal’s chief economist, said Tuesday as three levels of government meet to discuss the Toronto market.
“If there’s really any doubt that the non-resident buyer tax in Vancouver had an impact, look no further than Victoria’s accelerating price growth since August,” said Porter, in a note released before federal finance minister Bill Morneau, Ontario finance minister Charles Sousa and Toronto Mayor John Tory were to meet to discuss the situation in Canada’s largest city where March prices were on average up 33 per cent year over year.
Porter noted Victoria is the only city outside of Ontario with a double-digit average price gain in the past year with the home price index up 20 per cent year over year.
The economist wrote the national market had only four months of inventory at the end of March, making for the tightest national market in a decade. But the story for the country is really about Ontario.
“Almost the entire province of Ontario’s housing market is now on fire, while most of the rest of the country wonders what all the fuss is about,” said Porter.
The economist said “many talk about the lack of supply and land constraints driving prices”, but noted March prices rose 21.5 per cent year over year in London and 21 per cent in Windsor. “There are lots of open spaces around London, for example,” said Porter.
Ottawa was the exception to the Ontario rule, noted Porter with prices and its home price index only up four to five per cent in March on a year over year basis. “Ottawa is a rarity: An Ontario city where prices are not on fire.” said Porter. “Still, with renewed public-sector hiring and accelerating population growth, there is room to run.”
from DIYS http://ift.tt/2oJMnHm
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