Main reason Chinese buy homes here is education

HOUSING STUDY

LINDA NGUYEN TORONTO • The top reason why foreign buyers from China want to get into the Canadian housing market is education, not investment, according to data from a popular global real estate listings website.

Figures released Tuesday by the Chinese website Juwai.com in partnership with Sotheby’s International Realty Canada found schooling was the primary motivation for potential Chinese homebuyers who viewed property listings in major Canadian cities in 2016.

It found housing needed for educational purposes was the most cited reason why 46 per cent of Chinese users were looking at properties in Montreal, followed by 44 per cent in Vancouver, 41 per cent in Toronto and nine per cent in Calgary.

The second most common motivator for the interested homebuyers was “own use,” which could mean the home would be used as a second or third property. Sixty-two per cent of those looking for homes in Calgary cited this was their main reason, followed by 37 per cent for Toronto, 25 per cent for Vancouver and 34 per cent for Montreal.

Investment was the top reason listed by a quarter of home seekers, with 27 per cent saying it was the main reason for their property searches in Vancouver and Toronto, 23 per cent in Montreal and 21 per cent in Calgary.

Brad Henderson, president at Sotheby’s International Realty Canada, says the figures show there have been misconceptions about why Chinese homebuyers look to Canadian real estate.

“I really think a lot of perception that people have around foreign buyers and specifically buyers from mainland China are informed by more anecdotal information and not statistics,” he said.

The data also indicated the majority of Chinese property searches were for Canadian homes priced below $655,050.

“While home buyers from mainland China have been identified as a notable segment of foreign purchases within the luxury property markets of Vancouver and Toronto, Juwai.com data dispels the assumption that Chinese interest is limited to the highend segment,” the report states. “Instead, it implies that conventional real estate dominates demand.”

The figures also found the implementation of a 15 per cent foreign-buyers’ tax last August in Vancouver had a swift impact on the interest of those searching for Canadian properties.

Juwai.com says immediately following the announcement of the tax in July, its listing inquiries for Vancouver plummeted 81 per cent yearover-year and 78 per cent in August year-over-year when the tax came into effect.

It also saw listing searches increased in other Canadian cities, with property inquiries soaring 1,050 per cent and 420 per cent year-over-year in Calgary during August and September, and rising 62 per cent and 72 per cent yearover-year in August and September in Toronto.

Montreal saw a small decline of four per cent yearover-year in August before gaining 152 per cent yearover-year in September.

Even so, Henderson says he anticipates the number of Vancouver searches to pick up again, citing a modest increase in the number of inquiries in the last quarter of 2016 which he attributed to prospective buyers having digested the impact of the foreign-buyers’ tax.

“So we believe that in 2017, we’ll probably see an increased interest in properties in Vancouver.”

The data also found Canada ranked third by users as the most popular destination for international homebuying, after the United States and Australia.

Juwai.com says the data was compiled over the course of 2016 from its more than two million monthly Chinese visitors. a growing rift between Montreal and Toronto partners on a number of different matters,” Bacal writes.

That rift hit just as the firm was shifting leadership. Founder Roy Heenan would retire as firm chairman in 2012. Since 1998, Bacal and Guy Tremblay had been the firm’s two co-managing partners. Tremblay, who was based in the firm’s Montreal office, left management in 2012. Bacal, who was based in the Toronto office, would step down in 2013. The two new co-managing partners would be Kip Daechsel in Toronto and Robert Bonhomme in Montreal.

In Bacal’s account, Daechsel and Bonhomme never gelled as co-leaders. They oversaw a tougher, more aggressive compensation process that tore at the fabric of the firm’s partnership, Bacal writes. “This new anger and mistrust was engendering a perceptible change in values. Profits were beginning to trump people,” he writes.

It’s hard to judge how fair this assessment is. As narrator, Bacal has the power to sugar coat his involvement in the story. He certainly provides some measure of mea culpa, but he’s not afraid to blame the firm’s leadership shortcomings on some of his partners. Still, the story is a powerful tool for anyone who wants to understand how a big law firm — or any big professional partnership — manages itself. No other book may ever reveal so much about what actually happens behind closed doors at one of the biggest law firms in the country.