Here's Diane Francis' take on foreign ownership of residential real estate. I don't agree with her any more than I would were she advocating limiting foreign ownership of stocks, bonds, commodities etc. or Canadians owning real estate outside Canada. She touches on other issues such as interest rates, CMHC, down payments etc all of which I thought should have been looked at years ago, but now the horse has bolted and it's too late to close those gates. At this point it's "buyer beware." Most of us know that markets sometimes swing pendulum like from the extremes of under owned to eventually over bought. In the long haul we also know that "The madness of crowds" usually ends in a reversion to the mean, painful for those who bought late, less so for those who got in early or those who just got out.
One other thing that I've just realized of late is that interest rate setters and policy makers have consciously decided to sacrifice those buying houses late in this housing boom/bubble in that they know abnormally low interest rates are adding fuel to an over heated residential real estate market and this is the price that is to be paid in an attempt to stimulate the wider economy. It's a triage of sorts, some home owners will die economically speaking so the broader economy may live.
To tame Toronto’s housing ‘bubble’, ban foreign buying
Diane Francis, The National Post Apr 13, 2012
Conventional wisdom is that this is the market at work. This is not the market at work. This is manipulation of a government system of open-ended mortgage insurance that is poorly supervised. What is going on here is a deluge of hot money from abroad that is creating an artificial and potentially dangerous real estate bubble. This mania happened in several other countries — where it was shut down — and has spread to Canada. Officials here have been urging restraint but that is not the solution. A ban on foreign buying of residences is the only solution.http://opinion.financialpost.com/2012/0 ... gn-buying/