12 August 2016Chinese enquiries for Canadian property surged 134% quarter over quarter during Q1 2016 long before the 15% tax kicked in.
What's more, this number is set to grow as more Chinese are seeking to diversify their assets in markets they perceive to be safe havens, such as Canada.However, while Vancouver and Toronto are the current top two favourites for Chinese buyers, there’s a new competitor rising fast that is nabbing much Chinese investor interest – Calgary, the largest city in Alberta.
3 factors behind Alberta’s appeal for Chinese buyers.
This makes Alberta the fourth most popular Canadian province with Chinese buyers after Ontario, British Columbia, and Quebec. What's driving Chinese investors to Alberta, though? We take a look at three reasons behind its sudden popularity with Chinese:
#1 New 15% foreign buyer tax in British Columbia.
According to the National Bank of Canada, Chinese buyers is estimated to have bought up one-third of Vancouver homes in 2015 – accounting for $12.7 billion out of the total sum of $38 billion invested in Vancouver’s residential real estate. However, a recently imposed 15% foreign buyer tax in British Columbia to cool the soaring housing prices in Vancouver may turn the tide, causing Chinese property investors to search for better options elsewhere in Canada. And with our Data seeing a 70% increase in Chinese buyer inquiries for Alberta, it would seem that they’ve found their new investment destination in Canada – especially in Calgary, which offers better value for money when compared with the inflated housing prices in Vancouver.
#2 Appealing and laid back lifestyle known as the gateway to the Rocky Mountains, Alberta is home to several UNESCO World Heritage sites, which includes the Dinosaur Provincial Park and thousand-year-old glaciers at the Columbia Ice field.Equally famed for its wilderness and for its ski slopes and resorts – a legacy as a host of the 1988 Calgary Winter Olympics – this makes Alberta an enticing nature haven and a breath of fresh air (literally) for wealthy Chinese. CEO Charles Pittar shares with The Globe and Mail that Alberta’s relaxing environment is eminently attractive to Chinese – especially those with families, who are seeking a better lifestyle abroad.
“Chinese interest in Alberta is going at a rapid pace. Of course, it’s starting off a much lower base than British Columbia or Ontario, so rapid growth doesn't mean the Chinese have suddenly become huge buyers of Alberta property, but what these trends show is that Alberta is starting to appear on the radar of Chinese buyers,” said Pittar.
Additionally, living cost in Alberta is comparatively low for a city that is booming with wealth, thanks to the fact that Alberta not only has a lower price of gasoline and natural gas, but also no sales tax.All in all, living in Alberta sounds pretty fantastic, and the Chinese are catching on to that.
#3 New direct flight from China to Calgary.
Hainan Airline has recently launched a new direct air link between Beijing and Calgary, and this convenient connectivity is expected to give Chinese arrivals in Alberta a real boost.This new direct flight capitalizes the burgeoning Chinese tourism interest in Western Canada – such as Alberta, Banff, and Lake Louise – which in turn, had highlighted the lack of non-stop flights from China to Calgary in the past. With Chinese being avid travellers and big fans of speed and convenience, it’s safe to say that Alberta would be receiving an influx of Chinese visitors in future – many who may consider to purchase a home there should they fall in love with Calgary or other parts of Alberta. Chinese appetite for Canada set to grow.
While it’s still early days yet, the three factors above play a pivotal role in driving Chinese buyers to both Calgary and Alberta in the long-term, especially as more and more Chinese property investors are moving towards new markets. Research also indicates that Canada’s popularity is set to leap, and with Alberta up-and-coming as an investment destination for Chinese, Canada's ability to captivate Chinese real estate investors remains stronger than ever – especially if the Chinese government decides to further loosen capital controls.