Foreign buyers not needed or wanted: RBC
March 13, 2018
Foreign-home buyers are not needed or wanted in Canada, the president and CEO of RBC—Canada’s biggest bank—told a New York investors conference last week.
David McKay said that Canada didn’t need the kind of foreign investment where an asset sits empty doing nothing productive.
Foreign capital is among the factors fuelling the home price surge in Toronto and Vancouver, McKay said, adding he supports taxation to stem the flow.
In the BC Budget released February 20, the provincial government raised the foreign-home buyer tax from 15 per cent to 20 per cent, and expanded it from Metro Vancouver to Vancouver Island and the central Okanagan. Ontario has also levied a tax on foreign-home buyers.
McKay added that measures already taken to cool the hottest markets are taking effect, with demand weakening and prices stable despite some intensive bidding remaining.
“We do not need foreign capital using Canadian real estate as a piggy bank,” McKay said.
According to a federal government study, foreign homebuyers account for less than 1 per cent of all home purchases in Canada, but it spikes above 4 per cent in parts of Metro Vancouver and Greater Toronto.