We look at the exchange rate for British pounds to Canadian dollars and evaluate if now if a good time to lock it in for your property purchase. Plus, a property market update on Toronto and Vancouver.
Spotlight on currency: is now a good time for Brits to buy in Canada?
A strong pounds mean your dream Canada home is cheaper!
At the moment, the pound remains close to its strong point against the Canadian dollar for six months. It is doing 14% better than its October 2022 low. Therefore, it is a good time for UK property buyers to buy a home in Canada. A stronger pound means cheaper homes in Canada: your property in Canada costs thousands less in pound.
You might be thinking: oh no, but I’m not ready to make my Canada property purchase right now. Not to worry – you can lock in this rate now for your property purchase in up to twelve months’ time. Smart Currency Exchange offer a Forward Contract which enables you to lock in an exchange rate for up to a year.
Purchasing a property in Canada has the potential to be a lengthy process, and in this time, the exchange rate can move against you. Within just a few months, a property that you’re eyeing up in Canada, could come to cost you thousands more in pounds.
This could mean you have to dig deeper into your pockets or put an end to your buying plans altogether. With a Forward Contract, your budget for a Canada property will not be impacted by fluctuations in the currency market. This makes it much easier to budget for your Canada home effectively and confidently.
Moreover, if you are not sure that you want to lock in an exchange rate quite yet, it is still a good idea to reach out to Smart Currency Exchange. Watching fluctuations in currency markets is a full-time job and Smart Currency Exchange will do that for you, helping you to make informed decisions about when to buy.
A look at the Toronto property market
Hamilton has seen price increases of 5.4%.
After almost a year of stagnation, prices are slowly starting to rise in Toronto. Data from the Canadian Real Estate Association shows that the average house sale price in the Greater Toronto Area was $1.106 million, up 2.4% from the previous month, and up 2.5% from the month before. However, year-on-year prices were still down 12.2% from the inflated peaks of early 2022. The story is not the same across Toronto. In rural areas, prices are still flat or dropping. While prices are rising faster in Mississauga, a large city neighbouring Toronto on Lake Ontario, by 4.7%. And up by 5.4% in Hamilton, a port city located on the western tip of Lake Ontario.
Moreover, both listings and sales have been below the ten-year average. But in the first four months of 2023, sales have picked up, particularly in the case of condos in Toronto.
A look at the Vancouver property market
Vancouver.
A similar story is playing out in Vancouver. Data from the Real Estate Board of Greater Vancouver shows that listings are low, and prices are not as high as last year, but have nevertheless been springing back. In April, sales of detached homes rose by 2.9 from March; attached homes rose by 2.1%. While apartments rose by 2% across the same time period.
Canadians are turning to investment properties
An online survey by Canadian real estate specialists Royal LePage found that 11% of Canadians (approximately 4.4 million people) are property investors and intend to add to their portfolio. Moreover, 23% of Canadians who do not own a residential investment property said that they are looking to in the next five years. Meanwhile, 51% of investors said that they wanted to add to their portfolio in the same period. Many have citied financial security and a way of protecting themselves against rising rent prices (national average rent was $2,002 in April) as the reasons for building a property portfolio.
As of this year, Canadian has implemented a partial ban on international investors, so as lucrative as building a property portfolio in Canada might sound, it won’t be so simple to achieve. Currently, foreign buyers are only able to purchase home in Canada if they have a work permit or visa or a property developer. If you are looking to move to Canada and become a resident there, this could be an option in your future.
