Canada will ban most foreigners from buying homes for two years and provide funding to boost supply to help stem soaring property prices. That is a warning shot for new investors from China and India, two of the biggest winners of permanent residency in recent years.
The measures will be contained in the state budget to be unveiled on Thursday, citing a person familiar with the matter, asking not to be named because the matter is private. The ban, however, will not apply to students, foreign workers or permanent residents, the person said.
Home prices in Canada have soared more than 50 per cent over the past two years. The market saw a record monthly increase in February as buyers acted ahead of rate increases by the Bank of Canada, taking the benchmark price of a home to C$869,300 (US$692,407).
Still, foreign ownership of Canadian homes remains small at about 3.8 per cent in British Columbia, and 2.2 per cent in Ontario, according to official data. The proposed ban is unlikely to alter much of the bullish fundamental or kill the market, according to Dexter Realty in Vancouver.
