International buyers eye N.S. vacation properties — especially in Cape Breton
Recent numbers from Statistics Canada show N.S. has higher rate of non-resident owners than B.C., Ontario
Nova Scotia has a higher rate of non-resident property ownership than British Columbia and Ontario — but unlike those provinces, most buyers aren't looking for a shiny new condo in the city.
Both B.C. and Ontario have imposed a tax on "foreign buyers" who purchase property in recent years, in an effort to cool housing markets and to avoid property speculation that some argue is pricing local residents out of affordable housing.
Jean-Philippe Deschamps-Laporte, the chief of the Canadian Housing Statistics Program with Statistics Canada, said that "intense discussion" prompted the federal agency to gather and compare the numbers.
The 2018 data shows non-residents own about 3.9 per cent of the 450,000 residential properties in Nova Scotia. That's slightly higher than the percentage of non-resident owners in Ontario (2.2 per cent) and British Columbia (3.8 per cent).
"The story [in Nova Scotia] is slightly different than what we have seen in Toronto and Vancouver, for instance, in the sense that we find municipalities that are easily accessible by ferries, locations that tend to be more recreational, have higher non-resident owner rates," he said.
Ontario and British Columbia both have far more total residential properties than Nova Scotia, with 4.8 million and 1.7 million, respectively.
Deschamps-Laporte noted Nova Scotia has proportionally more recreational properties than the other two provinces, and many non-resident owners seek out vacation homes.
Statistics Canada studied housing information about non-resident owners, which means their primary home is outside Canada.
The area with most non-resident ownership in Nova Scotia is Cape Breton, and specifically the eastern side of Richmond County, where 14.3 per cent of the residential properties are owned by non-residents.
The non-resident owners mostly own single-detached homes and vacant land.
The trend is something former county warden Richie Cotton first noticed in the 1990s. At the time, it sparked a lot of discussion and research.
"It wasn't so much that people were against people from outside coming in, it was people or corporations or companies that were buying up the land and then not doing anything with it," he said.
"That was a big controversy because people around here felt that the land, somebody else could use it and develop it and start a family or whatever."
Cotton said over the years that did happen to some properties, but not to all. In eastern Richmond County today, non-residents own about 22.7 per cent of vacant properties, while Canadian residents own the rest.
"I don't think that's actually happened to a degree that caused the major concern," he said. "Most people that are buying the land are actually moving here, and of course there's nothing wrong with that. That was welcome."
Cotton said most of the non-resident owners he meets are from Germany, the United States, Austria, and people from land-locked European countries looking to buy property near the ocean.
He said he sees a mixture of uses, from people who live at their properties in the summer to those who live there year-round.
The top areas of Nova Scotia attracting non-resident property owners include:
- Eastern Richmond County, Cape Breton (14.3 per cent)
- District of Shelburne (13.2 per cent)
- Southern Inverness County, Cape Breton (11.9 per cent)
- St. Mary's District in Guysborough County (11.1 per cent)
- Southern Victoria County, Cape Breton (10.2 per cent)
Other popular areas with non-resident owners include the areas around Digby and Annapolis, and along the South Shore.
The Canadian Mortgage and Housing Corporation is working with Statistics Canada to analyze the data. Senior analyst Kelvin Ndoro said it was slightly surprising that Nova Scotia's rate of non-resident ownership was above British Columbia and Ontario.
"Because, for the most part, it's always been B.C. that's in the news when it comes to non-resident ownership," he said.
His team found non-resident owners in the other two provinces liked properties in cities like Toronto and Vancouver, and particularly condos.
"In Nova Scotia, it was the reverse," he said.
The rate of non-resident ownership was much higher outside Halifax than in the city.
"I think that's one thing that we are trying to better understand when it comes to non-resident ownership, is to why non-residents would invest in the housing market in different places and the reason that they do," he said.
"I think it comes down to different issues: whether they are investing in it as an asset, a future asset for income purposes, or just for retirement."
Ndoro also pointed out that the term "non-resident" does not necessarily mean a non-Canadian citizen or an immigrant. It simply means the person does not list their primary dwelling within Canada.
"We need to better understand between the two differences," he said. "In cases like Nova Scotia, for example, it could just be a case of ex-pats who are planning to retire back home and are buying land."