Toronto’s housing market has become a target for “snow washing,” or money laundering due to anonymous property ownership, weak regulation and lax enforcement, according to a new report.

Since 2008, $28.4 billion worth of housing was purchased in the Toronto region largely through private entities where owners can remain anonymous, according to a report released by Transparency International Canada, Canadians for Tax Fairness and Publish What You Pay Canada on Thursday.

In that period, companies bought $9.8 billion of housing through cash purchases, largely bypassing anti-money laundering checks on fund sources and beneficial owners, according to the report, which analyzed over 1.4 million residential sales dating back to 2008.

“Canada’s lack of beneficial ownership transparency makes our entire country an attractive destination for money laundering,” the report said. “While some vacant properties in Toronto might sit as investments for legitimate money, a worrying amount slips past regulators who do not really know who owns what, nor how much is being used for money laundering and tax evasion.”

Toronto has ranked among the least affordable housing markets in the world and become a target for speculative investment. The Ontario government brought in a foreign-buyers tax in 2017 and instituted audits of real estate speculators in the region.

However, more measures should be implemented to shed light on the extent of anonymous ownership in the market, including requiring disclosure of beneficial real estate owners as a prerequisite for any property transfers, the report said.

Meanwhile, the Toronto Real Estate Board said that it would welcome a discussion with other housing market stakeholders, including the government, about requiring beneficial owners to identify themselves to land title authorities, according to a Bloomberg report.

Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate