Sales of luxury homes have declined in July and August in the western city of Vancouver while they have gone up in Toronto, according to Sotheby’s International Realty Canada. The news will likely add to the growing controversy over real estate.
House prices have skyrocketed in Vancouver. The Globe and Mail newspaper printed a series of articles describing foreign ownership, extensive real estate speculation, alleged fraud and alleged tax evasion. In response, authorities imposed a new foreign buyer tax in Vancouver in August and provincial officials asked the national tax agency to investigate.
In July, sales of single-family homes priced at over $1 million in Vancouver fell 30 per cent compared to the previous year and in August sales were down 65 per cent.
Sotheby’s says increasing interest from foreign buyers and local market fundamentals are likely to boost the market in Toronto.