Canada PM pledges limits on foreign home buyers if needed

Wed Aug 12, 2015 2:49pm EDT
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By Randall Palmer

OTTAWA (Reuters) - Canadian Prime Minister Stephen Harper pledged on Wednesday if reelected to limit foreign purchases of Canadian real estate if it turns out that such purchases are pricing Canadians out of the housing market.

"There are real concerns that foreign, nonresident real estate speculation is the reason some Canadian families find house prices beyond their budgets," Harper said in Vancouver, where the housing market is especially hot.

The Greater Vancouver market has seen an influx of money from China and Hong Kong, and the average price of a detached home in the area in July was C$1.4 million ($1.1 million).

Harper said that by some estimates, 15 percent of Vancouver's condos sit empty.

"No dreams are living there. If such foreign, nonresident buyers are artificially driving up the cost of real estate and Canadian families are shut out of the market, that is a matter we can and should do something about," he said.

For starters, he said that if his Conservatives win reelection on Oct. 19, the government will start collecting comprehensive data on the purchase of Canadian real estate by nonresident foreigners.

If necessary, he said the government would, in coordination with Canada's provinces, "take action to ensure that any foreign, nonresident investment supports the availability and affordability of homes for Canadians".

A Conservative statement pointed to Australian measures as a possible model: regulations limiting foreigners' ability to purchase existing homes for investment purposes but allowing foreign investment that leads to the construction of new homes.   Continued...

Conservative leader Prime Minister Stephen Harper speaks during the Maclean's National Leaders debate in Toronto, August 6, 2015. REUTERS/Frank Gunn/Pool