There was a lot of talk about foreigners buying Canadian real estate in 2017. Earlier in the year the media jumped on the bandwagon—inciting anger in many Canadians by insisting foreigners were driving up home prices across the province. The Ontario Government even used the ‘foreign buyer argument’ as part of it’s Fair Housing Plan to score political capital. I have always disagreed with this analysis, which was never based on facts. At the time I stated that foreigners made up a very small percentage of buyers, certainly too little to have a real impact on the real estate market.

The Ontario government released its housing plan in April, slapping a 15 percent tax on foreign buyers, to gain approval from the population. The problem was that they had no data to back up any of their claims. It was simply easier to be able to identify an “enemy” than to admit the truth; house prices were going up because of a severe shortage in housing supply.

The numbers have now come to light almost a year after the government actually initiated these housing policies. The numbers that are out are exactly the numbers I expected. If you go back and see my articles from earlier in 2017 and even in late 2016, I was very direct and very confident in my analysis that foreigners made up a small percentage of buyers and they were mostly buying new condos. People can be misled, but eventually the numbers will not lie.

Statistics Canada has released their official numbers. These are the most up-to-date numbers that exist. For all types of real estate, foreign purchases account for 4.8 percent of properties in Vancouver and only 3.4 percent in Toronto. The purchases seem to be concentrated in downtown condos in both cities. This is an area where we need assistance from investors. New housing supply depends on pre construction sales in order to obtain construction financing. Domestic purchasers tend to shy away from buying in these projects because they usually require 20% deposits and come with lengthy wait times until completion.

The percentage of foreign buyers in the Ontario market was so small and concentrated (In Toronto Condos) that they couldn’t have had a significant impact on the entire province’s real estate market. I took heat from some earlier in the year when I was taking a stand and saying the percentages were very small and they weren’t having the impact the government was saying. The fair housing plan was nothing more than political games, which ultimately harmed countless home buyers and sellers. Our team saw the fallout from these scare tactics first hand. The Toronto Star had a great article on the impact from Ontario’s failed housing plan in this weekends paper. You can read the article here. This families financial well-being was harmed not because of a natural change in a free market, but because of political greed.

I believe government performs an important role in society, but I have issues with policies designed to buy votes. Nevertheless, it’s quite shocking that almost a year after the Fair Housing Plan was announced the first pieces of data are coming in. Last time I checked, governments were supposed to know the facts before enacting policies that affect peoples lives.