Chinese Investors Driving Up Metro Housing Prices

[st7860]

Yes australia is known to be not so accepting of different people .

[whatnext]

Originally Posted by st7860

Yes australia is known to be not so accepting of different people .

Yes, far better that we just roll over and let our families be priced out of our own cities.

Fortunately it seems people may finally be getting sick of this trend. However, I doubt our developer-funded civic politicians will ever do anything about it. From yesterday's paper:

"..Former city councillor Peter Ladner and departed chief city planner Brent Toderian told The Province there are many political and economic reasons for Vancouver’s leaders to avoid probing the impact of foreign investment on real estate prices. Community activist Randy Helten said city hall is actually making Vancouver more attractive to offshore investment by failing to act while other cities around the world take steps to regulate money flowing from China and other countries.

One top Vancouver real estate executive, who did not want to be named, said in 2011 it was estimated that for every $1-million spent on all types of real estate in Vancouver, $300,000 could be attributed to demand from China. Several months ago, coincidentally, the Bank of Canada estimated that some markets in the country are over-valued by up to 30 per cent.

The executive said that people in his business generally don’t want the public to understand the magnitude of offshore investment, and certainly don’t want city hall to do anything about it...
http://www.theprovince.com/business/...619/story.html

[st7860]

Australia is discriminating against people and silly. If people want to buy real estate in Canada sure. I'm not going to whine and moan about the prices. I don't know that many people sick of it except on misc. forums. Canada is known as free country. The higher the better.

[WarrenC12]

I'd argue it's a federal government issue.

[st7860]

A lot of people don't realize that people who buy a house and leave it empty still have to pay stuff like school and property taxes for services they don't use which keeps taxes lower for everyone else.

[whatnext]

Originally Posted by st7860

A lot of people don't realize that people who buy a house and leave it empty still have to pay stuff like school and property taxes for services they don't use which keeps taxes lower for everyone else.

Nonsense. Anybody who ocuppies that housewould be paying the same taxes. And there's no guarantee that the services aren't used: streets still need to be paved, street trees pruned, landsacpers who keep the grass mowed in these ghosts houses put out garbage that needs to be collected. And money is lost to the economy beacuse that house isn't full of poeople who purchase goods locally. And then there's the damage done to neighbourhoods that are emptied and hollowed out, and the retail that serves them.

It boggles the mind that anybody would actually argue in favour of this, unless they have a vested interest.

[st7860]

I'll try to use easier words. The higher the prices go, I don't care. If they want to spend money, sure. All houses come with property and school tax bills, plus bills for water and sewage which need to be paid whether or not water is used(In Vancouver most homes don't have meters)

[WarrenC12]

Property taxes could be more progressive with respect to property values (ie x 1.5 over $1M, x2 over 2M and so on). That might help.

I realize people who live in high value areas may not have the income, but frankly, I don't care. They won the real estate lottery with skyrocketing real estate values, and can certainly "afford" it more than people with a similar income living in an apartment or renting.

[LowerLonsdaleMike]

Originally Posted by st7860

I'll try to use easier words. The higher the prices go, I don't care. If they want to spend money, sure. All houses come with property and school tax bills, plus bills for water and sewage which need to be paid whether or not water is used(In Vancouver most homes don't have meters)

You must have a vested interest in a home in Vancouver if you're saying that. The average person like me is completely priced out of owning a home and I find that ridiculous because I make an above average household income and am forced to live in a condo. I really hope there is a 30% overvaluation because the housing prices in Vancouver are not fair to the hardworking local families that live here and contribute to the local economy.

[st7860]

Some people are priced out of various things. That's normal. There a plenty of people that were born in Vancouver that have houses or condos. I haven't heard of anyone forced to live in a condo. I really hope there is more valuation as that benefits all

[twoNeurons]

If you came down on foreign ownership, it would remove the "chinese boogeyman" out of the equation.

I'm not one to actually do this because I don't believe it is really a problem. It's a tool that the real estate industry uses to artificially buoy markets when times are tough. It's the unknown boogeyman.

1. Super hard to disprove, because the Real Estate Industry CHOOSES not to release real numbers or raw data.
2. Hits an emotional chord as we fear change
3. Hits an emotional chord as we fear losing control
4. Shifts blame and responsibility and allows us to point the finger at an unknown enemy instead of looking inwards and asking the tougher questions

Yes, we do have some foreign ownership, especially of high end properties

Questions we SHOULD be asking:

• Why do statistics only ever focus on a tiny subsection of the market, like houses over $2M
• Why is there suddenly an article seemingly designed to induce panic and fear at the end of an extremely sluggish sales period and right before spring
• Why are stories like this preceded by anecdotal stories with very limited numbers
• Why aren't American buyers targeted. (They make up a very large percentage of foreign owners) In Victoria, where they publish such numbers, they make up 1/2 of all foreign buyers.
• Why isn't there a push to open up the numbers and make the real historical data available like they do in the US (making Zillow possible and useful)
• Why does the industry who has a vested interest in selling property the only agency who has control of all the stats? Shouldn't this be done by a third party?
• Why doesn't the Province do what Nova Scotia did and release real estate data to private companies, allowing sites like ViewPoint.ca to empower people to make smart decisions when looking for property. Things like recent selling prices, days on market and recent valuations are available.
• Doesn't this kind of data allow people to make smarter decisions when making the biggest purchase of their life?
• Why can you do a carproof on a $7000 car, but you can't do anything similar with a $700,000 house?

I get annoyed when articles about foreign ownership controls are cleverly timed at the beginning of real estate season.

[LowerLonsdaleMike]

Originally Posted by st7860

Some people are priced out of various things. That's normal. There a plenty of people that were born in Vancouver that have houses or condos. I haven't heard of anyone forced to live in a condo. I really hope there is more valuation as that benefits all

Which planet are you from? Vancouver is an abnormality. The facts are there. And you're very misguided if you say further valuation benefits all. It certainly would benefit all that own a home, but certainly not anyone else. Folks that have average houses in Vancouver either bought when pricing was much more representative of local income levels, or came in here with a bucket full of money.

[twoNeurons]

Originally Posted by st7860

I'll try to use easier words. The higher the prices go, I don't care. If they want to spend money, sure. All houses come with property and school tax bills, plus bills for water and sewage which need to be paid whether or not water is used(In Vancouver most homes don't have meters)

Actually, you do have a vested interest in keeping prices relatively stable and correcting when necessary. It's not just about being priced out of a market. As prices get more and more out of line with fundamentals, you have more and more people who are spending higher and higher percentages of their paycheck to mortgages. This leaves less disposable income available for other things when you're shelling out 60-70% of your income on housing. Canadians as a whole are WAY more leveraged when it comes to debt than Americans were in 2008. They let their banks fail. We (taxpayers) had the banks back.

Society as a whole suffers. Companies can have second thoughts about moving here if they can't attract talent who can afford to live here. Startups reconsider or are somewhat hamstrung. There is a good case for distribution of wealth. This kind of equality is actually what "The New World" was built on. Taking control away from aristocratic classes and into the people. When you have people working 60 hours a week to afford their mortgage payment, do they really have time to contribute in other meaningful ways to society as whole?

Remember that wealthy people keep a much smaller amount of their portfolio in real estate. And in many cases, it's commercial real estate that returns a profit.

Finally, yes... I know that no one's holding a gun to people's heads, but it's puff pieces like this and other stinky things released by the Real Estate Industry that fuels the madness. If anything, it's not foreign ownership that should be controlled, but the real estate industry as a whole needs more transparency.

But isn't that the problem? Isn't it so much easier to point east and blame the billion-person-unstoppable-uber-wealthy-nation than demand numbers, answers and responsibility from inside?

In other news, all things point to rates going up after the US does. There's only so long the central bank can hold out. Barring another melt-down in the US, we may see danger time for people who are over-levereged next year. It will be interesting to see what kind of spin is generated as that happens.

[djmk]

regarding Chinese money in Vancouver, apparently some of it is corrupt money (and Chinese agents are HERE looking for it!). I don't think its accurate as calling these people investors but rather money launderers.

http://www.theprovince.com/business/...987/story.html

[st7860]

Originally Posted by LowerLonsdaleMike

Which planet are you from? Vancouver is an abnormality. The facts are there. And you're very misguided if you say further valuation benefits all. It certainly would benefit all that own a home, but certainly not anyone else. Folks that have average houses in Vancouver either bought when pricing was much more representative of local income levels, or came in here with a bucket full of money.

Many people say the market isn't different in Canada and here you say Vancouver is different really?

[djmk]

And one last thing about these "investors"...

Apparently, refugee immigrants are reporting higher incomes than the investor class immigrants.

http://news.nationalpost.com/2015/03...or-immigrants/

[st7860]

Originally Posted by djmk

regarding Chinese money in Vancouver, apparently some of it is corrupt money (and Chinese agents are HERE looking for it!). I don't think its accurate as calling these people investors but rather money launderers.

http://www.theprovince.com/business/...987/story.html

Have you ever heard of anyone actually bringing in and declaring a suitcase? Its legal but I've never heard of it. Wire transfers are reported to Fintrac.

[st7860]

Originally Posted by djmk

And one last thing about these "investors"...

Apparently, refugee immigrants are reporting higher incomes than the investor class immigrants.

http://news.nationalpost.com/2015/03...or-immigrants/

its normal for one person of an investor class couple to declare non residency and come back a tourist thus making it legal.

[st7860]

Originally Posted by twoNeurons

Actually, you do have a vested interest in keeping prices relatively stable and correcting when necessary. It's not just about being priced out of a market. As prices get more and more out of line with fundamentals, you have more and more people who are spending higher and higher percentages of their paycheck to mortgages. This leaves less disposable income available for other things when you're shelling out 60-70% of your income on housing. Canadians as a whole are WAY more leveraged when it comes to debt than Americans were in 2008. They let their banks fail. We (taxpayers) had the banks back.

Society as a whole suffers. Companies can have second thoughts about moving here if they can't attract talent who can afford to live here. Startups reconsider or are somewhat hamstrung. There is a good case for distribution of wealth. This kind of equality is actually what "The New World" was built on. Taking control away from aristocratic classes and into the people. When you have people working 60 hours a week to afford their mortgage payment, do they really have time to contribute in other meaningful ways to society as whole?

Remember that wealthy people keep a much smaller amount of their portfolio in real estate. And in many cases, it's commercial real estate that returns a profit.

Finally, yes... I know that no one's holding a gun to people's heads, but it's puff pieces like this and other stinky things released by the Real Estate Industry that fuels the madness. If anything, it's not foreign ownership that should be controlled, but the real estate industry as a whole needs more transparency.

But isn't that the problem? Isn't it so much easier to point east and blame the billion-person-unstoppable-uber-wealthy-nation than demand numbers, answers and responsibility from inside?

In other news, all things point to rates going up after the US does. There's only so long the central bank can hold out. Barring another melt-down in the US, we may see danger time for people who are over-levereged next year. It will be interesting to see what kind of spin is generated as that happens.

Priced out of the market doesn't matter. Many things in Vancouver or any city in Canada are priced too high, not just a piece of real estate. Society as a whole benefits from higher prices. Many people make new companies or buy existing ones in BC. Remember that wealthy people, in particular the specific ethnic group that people talk about , do keep their money in real estate and not so much stocks. Realtors don't create a market. Sellers and buyers do. Sure Canadian interest rates could go up and follow the US, and *if* that matters, that would also mean the so called foreign buyers of Canadian Real Estate aren't affecting the markets here because most of the people getting high ratio mortgages are Canadians.

[djmk]

Originally Posted by st7860

Have you ever heard of anyone actually bringing in and declaring a suitcase? Its legal but I've never heard of it. Wire transfers are reported to Fintrac.

Yes actually.

I don't think Fintrac does it's job at preventing laundering. Of all the money that I see flow into or out of my clients accounts from/to over seas, I'm sure its being reported but I don't think it has ever been questioned once.