Remember the foreign buyer ban?
I do.
A few years ago, foreign buyers were painted as one of the main reasons housing prices were skyrocketing. Then the research came out and showed they actually represented only about 2%–5% of the market. Despite that, the federal government introduced a ban on foreign homebuyers.
That ban is scheduled to expire on January 1, 2027.
Here’s what’s interesting: nobody in government seems to be talking about it.
So it begs the question: what happens when the clock strikes midnight on December 31, 2026?
It reminds me a little of December 31, 1999. Remember Y2K? There was widespread panic over what would happen when our computers rolled over to the year 2000. Midnight came… and nothing happened. Cinderella didn’t turn into a pumpkin.
I don’t think there’s panic surrounding the foreign buyer ban expiring. If anything, I’m sensing optimism—especially from developers and condo agents like me.
While foreign buyers were never a large percentage of the market, having more buyers is rarely a bad thing. Toronto’s condo market could certainly use the extra demand.
I assumed this was a topic only real estate insiders were paying attention to, so I was surprised when one of our first-time buyer clients brought it up. He told me he wants to buy before the ban expires.
I thought that was pretty savvy thinking.
Many foreign buyers purchase condos as investment properties, so if the ban is lifted, entry-level condos could see increased competition. Whether that impact is large or small remains to be seen, but I can certainly understand wanting to get into the market before another group of buyers potentially enters the picture.
So why is there so much speculation that the ban will actually expire?
From what I’ve been hearing, extending it isn’t as simple as signing another piece of legislation. The government would need to go through a formal consultation process, including publishing proposed changes in the Canada Gazette and allowing time for public feedback. That process is said to take roughly 18 months—and with the current expiry date fast approaching, time is running short.
Personally, I’d be happy to see the ban lifted for the condo market, even if it remained in place for other property types. The condo market has been struggling with an oversupply of listings, and for many agents, getting a showing booked these days can feel like pulling teeth. A few more motivated buyers certainly wouldn’t hurt.
As I mentioned last week, I was interviewed by The Globe and Mail. Here is a snippet of our conversation:
Davelle Morrison, broker with Bosley Real Estate, notes the condo segment in the GTA remains awash in listings with few buyers for smaller one-bedroom units.“In the $500,000 range, it’s crickets,” says Ms. Morrison, adding that some units are not even drawing showings.As a result, Ms. Morrison says, buyers who are willing to look at entry-level units have hefty bargaining power.She worked with one first-time buyer who recently purchased a unit for $364,000 at Jarvis Street and Dundas Street East.The buyer was upfront about having a budget below $400,000, Ms. Morrison adds.“I was shocked at how much I had to show them.”This buyer was very realistic, she adds, unlike people who have trouble deciding because they tend to like units that are just out of reach.“‘Like’ what is actually in your budget,” is her advice.In this case, the buyer purchased a unit with 549 square feet of living space and a balcony in a 10-year-old building.The main selling point, in a segment saturated with units with unappealing layouts, was that it had a true bedroom with a door, Ms. Morrison says.The unit, originally listed in April of 2025 with an asking price of $519,000, went through a series of price cuts until it was listed for $368,000, Ms. Morrison says.The seller was an investor who had purchased the unit from plans. During the time it was listed, a tenant moved out.She counts herself among the many agents who will not show a unit to buyers if tenants are still occupying the space because sometimes they refuse to move out, which can create complications on the closing date.She points to the example of one house she listed in the Leslieville neighbourhood that only had one showing while it was rented.Eventually the tenants did move out, and she is planning to relist the property with a fresh paint job and furniture and décor brought in by a staging company.“If I have buyers who are looking – no matter the price point – I’m not showing it if it is tenanted. You just don’t know that the tenants are going to leave,” Ms. Morrison says.Those condos that do attract interest tend to be larger units in upscale buildings because that is the tranche where many downsizing baby boomers are concentrating their search.Ms. Morrison recently listed a two-bedroom corner unit at 38 Avenue Rd. with an asking price of $2.68-million.Within a couple of days, two buyers booked showings for the unit with 1,845 square feet of living space and an elevator that opens directly into the foyer.She says the unit is out of the price range of many younger aspiring buyers, but the property is more likely to suit a homeowner with a house to sell around the $4-million mark or higher.The building in the Yorkville neighbourhood near Avenue Road and Bloor Street offers valet parking and a concierge, she says, and many buyers are looking for those services at the higher end.Still, condos in that price range have been sitting in the area, she says, as buyers take their time making decisions.
Thanks for reading and don’t forget if you need to buy or sell, please think of Davelle.
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