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Montreal Real-Estate Mkt. Could Escape Foreign Control

A new tax on foreign buyers in Vancouver has real-estate agents predicting a spillover effect into other Canadian markets.

But it's unclear if Montreal, will be among them, with experts opining that the market in that city is nothing compared to Toronto and Vancouver

The new 15% tax, which took effect Tuesday, was introduced by the British Columbia government with the intent of improving home affordability in Metro Vancouver, where house prices are among the highest in North America.

Ontario Finance Minister Charles Sousa has said he is examining the possibility of a similar tax "very closely," as a measure to address Toronto's skyrocketing home prices.

Experts believe the Vancouver tax could exacerbate the booming housing market in Toronto and, potentially, affect other Canadian cities.

However, the Montreal market has so far remained off the radar of foreign investors.

In a report last month, the Canada Mortgage and Housing Corporation said the number of foreign investors in the Montreal area is small and concentrated in condominiums in the city's downtown.

The report found that 1.3% of condominiums in the greater Montreal region were owned by foreigners last year.

That number jumps to nearly 5% in the city's downtown.

Residents of the United States and France accounted for the majority of foreign buyers, while China (at eight per cent) and Saudi Arabia (5%) accounted for far fewer buyers.