Homebuyers turning to Seattle? Firm says no
Website’s traffic has not increased since B.C.’s introduction of foreign buyers’ tax
In trying to measure the ripple effects of B.C.’s tax on foreign buyers of Metro Vancouver real estate, one American property-search firm is doubtful a wave of buyers washing into Seattle is one of them.
The search firm Zillow analyzed traffic coming to its website from within China and Canada, and found their service didn’t see a surge of Seattle-focused searches after the tax was introduced, said Svenja Gudell, the company’s chief economist.
If buyers were changing locations because of the tax, “you would expect to see an increase in traffic, and we’ve seen absolutely no increase in traffic from Chinese potential buyers,” Gudell said.
Gudell acknowledged that tracking its own web traffic is “never a perfect endeavour,” but it can highlight trends in the absence of better data. For example, Zillow did see an increase in Seattle-focused searches from China around the Lunar New Year.
“I’m sure you can find investors that say, ‘It’s getting a little too rich for me in Vancouver, I’m going down to Seattle,’” Gudell said. “I’m not ruling out examples of that, but not in significant numbers.”
Gudell said Seattle is already an attractive destination for foreign property buyers and it’s a hot mar- ket, which adds to the complications in trying to attribute increasing activity to the B.C. tax.
And in Metro Vancouver, sales had already started slowing at the same time China instituted new controls limiting the amount of money people could get out of the country, which also have to be factored in, Gudell said.
Zillow published the analysis at the same time cities around North America are attempting to gauge whether they’re getting some spillover of buyers leaving the Vancouver market.
Ontario, for example, isn’t ruling out its own foreign buyers’ tax, said the province’s finance minister, Charles Sousa, though the government isn’t certain how much of an impact foreign buyers are having in Toronto’s soaring property market.
Zillow’s findings clash with the experience of the Beijing-based search site Juwai.com, which bills itself as China’s No. 1 property website, which tracked big increases in Seattle-focused queries after the introduction of the tax.
“If the Vancouver tax benefited anyone, it benefited Toronto and Seattle,” said Juwai CEO Charles Pittar in an emailed statement. “We did see a shift in demand to those two cities, although that shift appears to be moderating as time passes, in particular with regards to Seattle.”
Pittar said it remains to be seen whether Seattle keeps its status in the top five most popular cities for searches.
Juwai’s data is based on the activity of two million monthly Chinese users and while Pittar said the surge of Seattle searches has subsided, “many local agents tell me they are still receiving buyer inquiries from buyers who have given up on the Vancouver home market.”
You would expect to see an increase in traffic, and we’ve seen absolutely no increase in traffic from Chinese potential buyers.