Chinese Investors Driving Up Metro Housing Prices

[jlousa]

Originally Posted by dleung

I'm actually dirt poor since my work barely pays, but my folks like to make it rain every Chinese New Year...

Awesome, do you have a single sister? Pics please.

[Vin]

Originally Posted by whatnext

I don't feel screwed over, I've got my house in Vancouver. I would have liked that one a it more, but that's life. I do feel bad for the younger people who will never be able to afford a house in Vancouver...for no valid economic reason

By that I mean there is nothing in Vancouver's economic fundamentals that has changed over 12 years to justify so many local wage earners being priced out of housing. Have we suddenly aquired a whole lot of high-paying jobs in banking? Record low interest rates do not explain the meteoric rise in prices. I'm sorry people get offended by having the obvious being pointed out. Any good realtor can tell you where the buyers are coming from, why pretend it's not a factor? That governments don't do a better job of monitoring so the facts can be out there in black and white is inexplicable.

It also surprises me that those who get all outraged about suburban sprawl don't see the cause and effect at work - if you can't afford a home for your family in Vancouver/Richmond/Burnaby you get pushed out to farther suburbs. Take a look at the demographic of those driving the rapid development of Langley and South Surrey.

It's the same when the first settlers came here from the old world and devised ways to impose monetary values on landed/real estate properties, so much so that natives and poorer folks were 'priced out'. The poorer immigrants could only afford the farmlands/homesteads and had to work hard to pay off their loans. What we see today is just a continuation of this trend. Today China just happens to be the nation that is supplying many of these millionaires who can afford very pricey properties in the well sought-after areas. Tomorrow it could be India. Capitalism is built on greed anyhow, and less competitive nations can only attract financial investments by attracting those with more to invest. For Canada to survive without the monetary input from investment immigrants, this country needs to tighten its belt, work longer hours and produce more for the world. Are Canadians willing to do that and sacrifice much of the treasured 'laid back' culture? I think not.

The young could certainly afford a property here if they were to sacrifice on the excessive luxuries (like owning a car right after high school or travelling extensively, or boozing weekly with no thoughts of saving a penny). Maybe they won't own a mansion, but savvy investments in other property markets outside the city can yield profits to be used as down payments for modest homes here. How do you think the Chinese became so rich in the first place? Not everyone from there is a crook like you assumed before. Many work their butts off and later own the factories that stock up shelves of your nearest Walmart or Apple Store. Many others venture into stocks and properties before making it big. Vancouverites can compete with them, it just depends on how we use our brain and time, and not giving lame excuses.

[red-paladin]

Originally Posted by jlousa

Awesome, do you have a single sister? Pics please.

>.> Or brother in the 'rose brigade' ....

[whatnext]

Originally Posted by Vin

It's the same when the first settlers came here from the old world and devised ways to impose monetary values on landed/real estate properties, so much so that natives and poorer folks were 'priced out'. The poorer immigrants could only afford the farmlands/homesteads and had to work hard to pay off their loans. What we see today is just a continuation of this trend. Today China just happens to be the nation that is supplying many of these millionaires who can afford very pricey properties in the well sought-after areas. Tomorrow it could be India. Capitalism is built on greed anyhow, and less competitive nations can only attract financial investments by attracting those with more to invest. For Canada to survive without the monetary input from investment immigrants, this country needs to tighten its belt, work longer hours and produce more for the world. Are Canadians willing to do that and sacrifice much of the treasured 'laid back' culture? I think not.

The young could certainly afford a property here if they were to sacrifice on the excessive luxuries (like owning a car right after high school or travelling extensively, or boozing weekly with no thoughts of saving a penny). Maybe they won't own a mansion, but savvy investments in other property markets outside the city can yield profits to be used as down payments for modest homes here. How do you think the Chinese became so rich in the first place? Not everyone from there is a crook like you assumed before. Many work their butts off and later own the factories that stock up shelves of your nearest Walmart or Apple Store. Many others venture into stocks and properties before making it big. Vancouverites can compete with them, it just depends on how we use our brain and time, and not giving lame excuses.

There is nothing stopping wealthy Mainland Chinese (or Russians or whatever) from investing in Canada through publicly traded stocks or other corporate investments. Selling citizenship only leads to bogus businesses that fold after the required time period.

There is no amount of belt tightening that will get a first time buyer on an average Vancouver wage into an average Vancouver house. There's exactly 3 properties on the West side under a million and 1 is on leased reserve land. On the East side there's 164, but they start at the bottom around $650k for this:
http://www.realtylink.org/prop_searc...000000&SCTP=RS

[trofirhen]

Originally Posted by whatnext

There is nothing stopping wealthy Mainland Chinese (or Russians or whatever) from investing in Canada through publicly traded stocks or other corporate investments. Selling citizenship only leads to bogus businesses that fold after the required time period.

There is no amount of belt tightening that will get a first time buyer on an average Vancouver wage into an average Vancouver house. There's exactly 3 properties on the West side under a million and 1 is on leased reserve land. On the East side there's 164, but they start at the bottom around $650k for this:
http://www.realtylink.org/prop_searc...000000&SCTP=RS

As I understand, other countries in a similar situation to Canada (Australia coming to mind) have laws that help constrain what Vancouver is experiencing. Perhaps this is a matter to be taken to Ottawa (with the requisite demands for change). The syndrome has become stratospherically untenable, especially as Vancouver is not a corporate centre with a lot of big corporate salaries. The feds need to revamp the immigration policy, focusing on "investor" immigration status, IMO. This will never be a "trickle-down" affair. It has to be a "bubble-up" situation, starting at the grass-roots level, by people numerous enough and willing enough to make their voices heard ... IMHO.

[Canadian Mind]

Originally Posted by jlousa

Awesome, do you have a single sister? Pics please.

Aren't you already committed?

If Dleung has a sister... Dibs!

[WarrenC12]

Originally Posted by whatnext

Or maybe we should just recouple housing prices to local incomes. But hold onto your hats, the worst could be yet to come according to today's Sun

Recouple? How are we going to accomplish that, comrade?

[WBC]

Well this is over:

http://www.vancouversun.com/news/Ott...380/story.html

[Pinion]

Yay, now we can be a normal city with a normal economy again

*watches condo value drop to 50% of mortgage*

Come back Chinese millionaires!! I don't care how you earned your money or if you pay taxes!!

[Millennium2002]

Hmm. Good news for us locals.

I don't feel very sympathetic to the high-end realtors and such who are predicting mass chaos in the markets... I mean, it's been chaos for many middle-income families for years with the silly sky-high home prices and associated household debt that we now have.

[Porfiry]

Originally Posted by whatnext

There is no amount of belt tightening that will get a first time buyer on an average Vancouver wage into an average Vancouver house.

So buy a condo. There are plenty.

[Cypherus]

Originally Posted by Porfiry

So buy a condo. There are plenty.

Too bad most have terrible resale value and are valued at 20-25% higher than intrinsic or actual value. It will be nice to see condos drop to what should be considered fair market value.

[whatnext]

Originally Posted by Porfiry

So buy a condo. There are plenty.

OK, so your "solution" is to sell of the best pieces of land to foreign gentry and let the the locals can cram themselves into little boxes. But that's "green" isn't it. Memo: not everyone's a single male.

[cornholio]

Originally Posted by red-paladin

No further vulgar / racist remarks will be tolerated.

I admit I may have been a tad vulgar in one of my posts, but I would find it insulting if anyone called me racist. I have a major problem with most (not all) of the wealthy elite from third world and developing countries because I know how most of them (not all) became wealthy in the first place, and I know people don't simply change, especially if there is no pressure to change. But this has nothing, and I mean nothing to do with race, and I always made this very clear.

Anyways the government knows the investor class immigrant program is a net drain on Canada, and has been causing economic problems. That is why the investor class program is now going to be scrapped and all the backlogged applications tossed. A good day for Canada, even if this decision came way too late. The new citizenship requirements are also good news, they somewhat close the second loophole for people who want to buy their way in.
http://www.theglobeandmail.com/news/...ticle16792106/

Having said this, the investor immigrant program will be brought back but completely reworked and it will be much smaller, though it may take a few years.

Now since this thread is about real estate prices, there is one more thing on its way, new regulations regarding foreign ownership, and non owner occupied properties. Depending on how much wind gets taken out of the national market this year we could see a push in that direction as soon as late 2014 early 2015.

[cornholio]

Just want to add one more thing, this decision will once and for all really take the wind out of the real estate market. 1) there will be less people in the near future coming in with cash to buy properties, allot less 2) there will be people liquidating properties because after meeting with their immigration lawyer they will realize that their not going to be coming here anytime soon

Basically this decision means possibly 1000-2000 less home sales in Vancouver per year and potentially in the thousands of properties whose owners will want to liquidate them because they jumped the gun. Personally I am curious to see how this plays out over the next year, my popcorn is ready.

But the feds have been warning Canadians for a couple of years now, so no one should be surprised when they realize what the feds are working towards.

Also wanted to add:

A source said the government is acting based on data that show that, 20 years after arriving in Canada, an immigrant investor has paid about $200,000 less in taxes than a newcomer who came in under the federal skilled worker program, and almost $100,000 less than one who was a live-in caregiver.

link Like I said, I would rather have a plane load of poor minors instead of a plane load of these investor class immigrants any day of the week. I expect the feds are also trying to find a way to go after tax evaders that came in through this program, however they should forget about the dream of striping them of their citiznehsips because it will never work and instead focus on fines and confiscations.

[Denscity]

Well the Feds stopped accepting new applicants 2 years ago so have we seen any negative results since then?

[spm2013]

Originally Posted by Denscity

Well the Feds stopped accepting new applicants 2 years ago so have we seen any negative results since then?

I guess if the waiting list was full it wouldn't have shown up right away... whatever you are trying to measure.

[geotag277]

A few points:

- scrapping the investor visa program does nothing to prevent foreign ownership of properties
- there are two new investor visa programs designed to replace the old program to hopefully bring more economic benefit to Canada
- the Government of Canada is prediciting the number of investor class immigrants will remain the same after this program
- people call the investor visa program a "fast track" to citizenship, but as of 2012 there was a 10 year backlog of cases, that isn't exactly fast tracking anything, the new investor programs are likely going to be much more efficient at bringing in high net worth individuals

Impact to Vancouver (or Toronto, or Canada's) housing market? Likely zero, or if anything, continued increases.

[cornholio]

Originally Posted by Denscity

Well the Feds stopped accepting new applicants 2 years ago so have we seen any negative results since then?

They had a huge wait list of some 80,000 applicants if I remember correctly. I know in 2010 alone they had 27,000 new applications but the ability to only process a few thousand. So no you would not see anything, not until now. Schools should be getting more international students, presumably their numbers have risen since 2010. Hopefully schools out here get their act together as well and start properly assessing the international students they bring instead of just looking at the dollar bills. Way too many scams out there, it devalues the value of our education system and internationally people are starting to take notice already.

Originally Posted by geotag277

A few points:

- scrapping the investor visa program does nothing to prevent foreign ownership of properties

It makes it significantly harder and removes most of the incentive. Most foreigners owned properties here because they had or wanted to have residency and/or wanted to have their family or kids here to live and/or study.

- there are two new investor visa programs designed to replace the old program to hopefully bring more economic benefit to Canada

There are no new investor visa programs. None, period.

- the Government of Canada is prediciting the number of investor class immigrants will remain the same after this program

Not sure where you are getting this since there wil be no investor immigrant program. The government does not want these people here, period. These people don't pay their share of taxes, they don't invest in Canada, they often don't live here, they usually don't speak english or french, they are under educated, they bring no benefits to Canada. They are a net drain. Canada does not want them, that is why they canceled the only investor immigrant program we had.

- people call the investor visa program a "fast track" to citizenship, but as of 2012 there was a 10 year backlog of cases, that isn't exactly fast tracking anything, the new investor programs are likely going to be much more efficient at bringing in high net worth individuals

As of 2009 there was only a 2 or so year processing time, after 2009 as western countries begun to smarten up and tighten their loopholes the waitlist in Canada shot up. The waitlist should have been worked through within a couple years, no big deal. These people have no other way of coming here because they don't bring any of our criteria, all they have is money that they somehow managed to accumulate in a corrupt communist country.

Impact to Vancouver (or Toronto, or Canada's) housing market? Likely zero, or if anything, continued increases.

If you think so, I am interested to see. The feds want the market to deflate and to stay deflated. There is more to come, though I think this will have a rather significant impact by its self.

[geotag277]

I already responded to you in your other housing bubble thread:

http://www.thestar.com/news/canada/2...mic_class.html

http://www.theglobeandmail.com/news/...ticle16821623/

http://www.theglobeandmail.com/news/...ticle16792106/

"It will be replaced by two pilot projects: an immigrant investor venture capital fund and a business skills program. Tens of thousands of those who have applied to the program and are currently on the waiting list will have their fees refunded – but will not have their applications processed."

"In tabling his annual report to the Parliament Monday, Immigration Minister Chris Alexander also announced that Ottawa will admit between 240,000 and 265,000 permanent residents to Canada in 2014, the same level as this year."

"While economic immigrants — those selected for their occupational skills, entrepreneurship and investment — will account for 63 per cent of the admissions, 26.1 per cent or 68,000 spots will be allotted to the family class. The remaining 10.9 per cent or 28,400 spaces will be for refugees and others with humanitarian needs."