Canada, like many countries, has certain limitations in place related to foreign investment and ownership – in everything from large-scale businesses to sports teams. These anti-free market, anti-capitalist measures are bad enough on their own, but Prime Minister Justin Trudeau and the Liberals have found a way to make these restrictions even worse.
The Canadian government announced last week that the existing ban on foreign nationals from purchasing residential property has been extended until 2027. The only exceptions to the rule will be asylum seekers, some international students and temporary workers.
For potential foreigner home buyers, including thousands of British expats, this is terrible news. Which isn’t to say they didn’t expect it. If they know anything about the Great White North, they probably sensed it was coming.
For a long time, house prices were sky-high in major cities like Toronto, Calgary and Vancouver, and strong in many mid-sized and smaller cities and towns. This remained the case during Covid-19, when prices increased by an astonishing 46 per cent between February 2020 and February 2022. You would naturally assume some of the roughly 650,000 British expats in Canada participated and took advantage of this real estate boom.
My family and I have been involved in mortgages and investments for over a century. We’ve witnessed many boom periods in Canadian real estate and, as you may have guessed, an equal number of bust periods. My father and I spent many an hour speculating on when the housing market in the city we live in, Toronto, would ultimately bottom out. The business cycles described by classical economists like Jean Charles Léonard de Sismondi and Robert Owen cannot be ignored or avoided forever.
Eventually that happened in Canada, when the real estate bubble burst. The Canadian Real Estate Association (CREA) had forecasted a decline of 3.3