What has driven home prices?

In Vancouver, almost 69 per cent of home buyers believe foreign investment is influencing the real estate market and driving up home prices, according to a new report from Canada Mortgage and Housing Corporation (CMHC).

For the report, Examining Escalating House Prices in Large Canadian Metropolitan Centres, CMHC surveyed 30,000 recent home buyers across Canada to find out more about home buyer perceptions.

“The survey allows us to better understand how home buying is influenced by attitudes and perceptions, giving rise to sustaining local narratives,” said Guillaume Neault, senior manager, analytics, CMHC.

Vancouver home buyers’ perceptions were in stark contrast to data released by Statistics Canada in late 2017.

This data found non-residents owned 4.9 per cent of properties in Vancouver. Of this percentage, seven to eight per cent were condominium apartments, while two to three per cent were single-detached homes.

The perception of foreign ownership influencing the market is not new.

In a 2015 Angus Reid Institute study of home buyer perceptions, 64 per cent of respondents believed foreigners investing in this real estate market is a main cause of high housing prices.

What is the reality?

There is always a demand and supply.  When the supply is low and the demand is high, the housing prices of course shall drive up.