Could Canadian Housing Market Already Be Feeling Impact of US Election?

It’s US election day and the Canadian housing market may look more appealing to some Americans, depending on whether they are Team Trump or Team Biden, and who takes the title of Commander-In-Chief. When all is said and done, could some of our friends south of the border be considering a move to the Great White North? And what could this mean for the Canadian housing market?

Immigration (or lack thereof) has been a factor in the demand for Canadian real estate in 2020, but any pandemic-induced decline could prove temporary. Before COVID-19 closed borders around the world, Canada was welcoming roughly 300,000 new Canadians every year, which carried a substantial demand for homes. We know those numbers have been cut dramatically due to restricted travel and immigration, however the federal government announced last week that it intends to increase the number of newcomers to 401,000 permanent residents in 2021, 411,000 in 2022 and 421,000 in 2023, as part of its 2021-2023 Immigration Levels Plan, which outlines “responsible immigration targets” in order to help Canada recover from the devastating impacts of COVID-19.

Perhaps this could also be an escape plan for our American friends who may be considering a move based on the election results, or for other reasons.

If Canada doesn’t restore the flow of newcomers, could that undermine the strength of Canadian real estate?

“It could, but I’m not sure that this is going to be a long-term effect in Canada,” Christopher Alexander, Executive Vice President at RE/MAX of Ontario-Atlantic Canada said in a recent interview on BNN. “We’re continuing to attract people. Yes, travel has been restricted and it’s been more difficult to move freely around the world, but as the United States continues to get stricter on its immigration rules, Canada is going to become even more appealing. While 2020’s [immigration] numbers are way down, we expect that once travel resumes and people can move freely, that number will tick back up again.”