Chinese Investors Driving Up Metro Housing Prices

[SpongeG]

developers and marketers usually go to their "go to" buyers to invest before its sold to the general public, thats the norm isn't it?

[giallo]

A good piece on the Chinese buyer in Vancouver. I think Sam Sullivan hit the nail on the head; Vancouver's zoning laws need some serious restructuring. But with people throwing a fit every time a building over 12 storeys gets proposed outside of downtown, and in traditional neighborhoods, be it the eastside or westside, it'll be an uphill battle before we see some serious changes.

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[Vestry]

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[whatnext]

From Bloomberg:

China Growth Sets Vancouver Home Prices: Chart of the Day

Vancouver’s housing market may depend on the strength of China’s economy as much as anything that happens in Canada.

The CHART OF THE DAY shows the relationship between growth in China’s gross domestic product and home prices in metropolitan Vancouver...

http://www.bloomberg.com/news/2013-01-20...couver-home-prices-chart-of-the-day.html

[whatnext]

Despute some fancy footwork, it would seem to be that Brent Toderian is essentially admitting foreign buyers are inflating house prices:

..Responding to a question from the audience about limiting foreign ownership, Toderian said it is “something the Mayor’s Task Force on Housing Affordability dropped the ball on. The competition between external demand and local demand — that’s the nicest way I can put it — is one of the reasons that, barring a collapse and a crash, we are going to remain a very expensive city to own in.”

Panel moderator, David Beers, editor of The Tyee, agreed, saying his publication tried to look into foreign ownership, but there is no clear way of measuring it. “So step number one might be to devise such a way,” he said. Another panelist commented that land speculation along the Cambie Line (Translink Canada Line on Cambie Street) is going to cut into a lot of the affordability that could have happened...
http://cityhallwatch.wordpress.com/2013/...ing-affordability-toderian/#comment-6772

[twoNeurons]

Originally Posted by giallo

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Just looking back at this video and find it sad that this kind of "reporting" of flying around fake buyers in a yellow helicopter was spewed on the evening news (I believe they were all local real estate agents) .

Add to this the recent MAC marketing scam and you've got a desperate industry on your hands.

[whatnext]

With Vancouver prices up, a call for curbs

...Vancouver routinely shows up in surveys as one of the most expensive real estate markets in the world, requiring its residents to devote at least 84 per cent of their monthly incomes to housing costs.

But even areas outside the city are becoming unaffordable to residents such as Joy Mo, who came to Canada from China in 2001. Ms. Mo got shut out of the market when she and her husband sold their Coquitlam house and decided to rent for a year before purchasing a bigger house for their growing family. Ms. Mo has been renting a townhouse in Port Moody for the past four years, unable to find a house in the Tri-Cities area that falls within their $650,000 price range. They’ve put two offers on houses in the past three months and were out-bid on both of them, one by a foreign buyer....

..She says you only have to look around to see that developers and marketers are catering to those buyers, particularly on the west side, in West Vancouver, Richmond, White Rock and the Tri-Cities area.

Because she’s from China, people often tell her she’s to blame for rising prices, but she’s not any different than the average middle-class resident. The government here, she says, should apply an extra tax to foreign owners...
http://www.theglobeandmail.com/life/home...ces-up-a-call-for-curbs/article15958026/

[Vancity]

Originally Posted by whatnext

With Vancouver prices up, a call for curbs

...Vancouver routinely shows up in surveys as one of the most expensive real estate markets in the world, requiring its residents to devote at least 84 per cent of their monthly incomes to housing costs.

But even areas outside the city are becoming unaffordable to residents such as Joy Mo, who came to Canada from China in 2001. Ms. Mo got shut out of the market when she and her husband sold their Coquitlam house and decided to rent for a year before purchasing a bigger house for their growing family. Ms. Mo has been renting a townhouse in Port Moody for the past four years, unable to find a house in the Tri-Cities area that falls within their $650,000 price range. They’ve put two offers on houses in the past three months and were out-bid on both of them, one by a foreign buyer....

..She says you only have to look around to see that developers and marketers are catering to those buyers, particularly on the west side, in West Vancouver, Richmond, White Rock and the Tri-Cities area.

Because she’s from China, people often tell her she’s to blame for rising prices, but she’s not any different than the average middle-class resident. The government here, she says, should apply an extra tax to foreign owners...
http://www.theglobeandmail.com/life/home...ces-up-a-call-for-curbs/article15958026/

the woman in the article has a point. and it's not just 'chinese investors' - but foreign investors as a whole, where ever they are from. robertson and his crew need to seriously consider applying the woman's recommendation to better control the market. apply the extra tax on people who are from out of the country who want to purchase condos, or single homes...don't even know why this hasn't been implemented years ago...

[Vancity]

Originally Posted by giallo

A good piece on the Chinese buyer in Vancouver. I think Sam Sullivan hit the nail on the head; Vancouver's zoning laws need some serious restructuring. But with people throwing a fit every time a building over 12 storeys gets proposed outside of downtown, and in traditional neighborhoods, be it the eastside or westside, it'll be an uphill battle before we see some serious changes.

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we need a leader who can make such decisions for this city.

change is always difficult, even if it's good change, but if the status quo is kept, then i agree, more and more people will leave the city. that's never a good thing. we want people to stay IN the city. so how do we make it more affordable for people to live IN vancouver, and not out in the suburbs or even moving to a different city just to make a living for their families.

i have two examples of friends. one who has moved to calgary because she and her family are growing, and they can't afford to own a house here in vancouver, let alone a condo (over 1,000 sq ft, impossible). and another friend who used to live in van, but moved out to coquitlam, because it's a cheaper out there.

[theKB]

I personally say why discriminate against foreign buyers and how about we slap any investment property with commercial property tax? I don't care if you are from Abbotsford or Azerbaijan. It will push revenues up for the cities.

Could also explore it as a new funding source for translink...

CBC Doczone recently did an interesting piece on the Toronto market and made a very valid point that the condo market is a commodity play more than anything.

http://www.cbc.ca/doczone/episodes/the-condo-game

[s211]

Originally Posted by theKB

I personally say why discriminate against foreign buyers and how about we slap any investment property with commercial property tax? I don't care if you are from Abbotsford or Azerbaijan. It will push revenues up for the cities.

You do realize that an investor would just push their higher tax cost onto their tenants.

[spm2013]

Just charge them a head tax.

[trofirhen]

Did not, or does not, Australia have a limit on foreign buyers?
Or perhaps the law is that if house buyers are going to invest there, they have to actually LIVE in the houses as residents?
At any rate, here, something's gotta give !!

[theKB]

Originally Posted by s211

You do realize that an investor would just push their higher tax cost onto their tenants.

I don't think that would be as much of a problem one would think. If people are buying places and having a mortgage many are not even covering the mortgages/fees/taxes as is with current rents.

Even now you can arguably get more bang for your buck renting than buying where if you hop down south to seattle its pretty much the opposite.

[easy as pie]

uh, the cities in bc have no power to draft/implement such taxes, it's the province's jurisdiction

[Porfiry]

Originally Posted by whatnext

The government here, she says, should apply an extra tax to foreign owners...

Uh, they already do. The "home owner grant" system means that local residents get a discount and therefore pay less in municipal property tax. Non-residents and investors get no such discount and therefore pay substantially more.

http://vancouver.ca/home-property-development/are-you-eligible.aspx

[go_leafs_go02]

Originally Posted by Porfiry

Uh, they already do. The "home owner grant" system means that local residents get a discount and therefore pay less in municipal property tax. Non-residents and investors get no such discount and therefore pay substantially more.

http://vancouver.ca/home-property-development/are-you-eligible.aspx

Which says:

By applying for the grant your property taxes can be reduced up to $570

Which to an investor is nothing. And you need to apply for this grant every year.

However, this is something I was never aware of beforehand. So thanks for letting me know.

[logan5]

Originally Posted by Vancity

we need a leader who can make such decisions for this city.

change is always difficult, even if it's good change, but if the status quo is kept, then i agree, more and more people will leave the city. that's never a good thing. we want people to stay IN the city. so how do we make it more affordable for people to live IN vancouver, and not out in the suburbs or even moving to a different city just to make a living for their families.

i have two examples of friends. one who has moved to calgary because she and her family are growing, and they can't afford to own a house here in vancouver, let alone a condo (over 1,000 sq ft, impossible). and another friend who used to live in van, but moved out to coquitlam, because it's a cheaper out there.

I hope the Norquay Village plan is a sign of things to come. Hopefully we can use this as a template for other neighbourhoods in order to expedite the painfully slow planning process.

I don't mind towers, but it's a housing type that is expensive to build, consequently expensive to purchase, and it's the most commonly built form of new housing in Vancouver.

Theoretically, stacked townhouses should be the most affordable form of housing as they are woodframe and don't require (at least in Norquay Village examples) underground parking. The price of a new condo in a tower at nearby Wall Centre Central Park (which is a concrete tower), in one example I've seen advertised, sells for $511/sq. ft. If we can get the price for a stacked townhouse unit to the 400/sq. ft level, this would put the price of a family sized 1200 sq. ft home at around $480 000. I think that lower prices are contingent on a large supply that requires more than 1 small neighbourhood with this housing type though.

http://vancouver.ca/files/cov/norquay-village-plan-rowhouse-townhouse-zone.pdf
http://vancouver.en.craigslist.ca/van/reb/4222935319.html

[cornholio]

People keep talking about foreign ownership. The real problem is a combination of our broken immigration system and failure of the CRA. First of all a large percentage of new immigrants are already wealthy, and another large percentage continue to earn money outside of Canada, which the CRA fails to identify and tax. You have literally thousands of people from 3rd world/developing countries immigrating just to Vancouver every year who can buy a house or two for cash. This was NEVER the case before, this is a new phenomena where growth and inequality has exploded in most parts of the world and western countries decided to sell their souls to the highest bidder, without a thought for how this will effect us in the long term. Most of the wealthy immigrants don't come here to be loyal to Canada, they come here to get a residency or citizenship card so they can plunder their original country while using Canada for its western service, education and most importantly as a safe haven for when things stop working out. Its not the foreign buyers that are the main problem, its the actual make up of the new immigrants we bring in.

I hope people remember that just over 20 years ago 95% of the immigrants were still from the working middle/poor class. Now I would wager that that number is going to be well under 50%, most new immigrants are now wealthy and from the top 5% of their original countries and coming here for very different reasons.

Anyways like anything else, this creates a bubble and we are in a big one. Hopefully this will lead to major reform of the immigration system and how the CRA operates.

You know when people say that foreign ownership is not a huge problem I believe them, I am sure that a majority of the people who they think are foreigners actually hold a residency card or citizenship and are technically residents, new residents.

[Chadillaccc]

Has anyone pulled the "this is racist" 🞵🞵🞵🞵🞵🞵🞵🞵 cop-out yet?