The Bank of America recently said that Canadian house prices are cheap, if you happen to be buying them in American dollars or Chinese Renminbi. As we know, buyers from the US and China may be a whopping 1.5% of buyers here in Victoria so clearly this finding has a large impact on us.
Nevertheless, our poor loonie has taken a beating in the last couple years, and it is interesting to see whether the bank’s claim that “Homes are cheaper on both a U.S. dollar adjusted and Chinese renminbi basis than in 2010-2014″ holds up in Victoria given our recent price acceleration. So here are our detached house prices in Canadian and American dollars, as well as Chinese Renminbi.
Surprisingly they seem to be correct and current prices in those currencies are below the levels of most of 2010 to 2014. Again, not that direct foreign buyers are much of a presence in Victoria, but maybe there is a larger group of locals that earn in USD and have benefited from the currency divergence.
Do you think the value of local real estate in foreign currencies has any relevance?