Chinese Investors Driving Up Metro Housing Prices

[ckkelley]

I'm talking about making sacrifices here. That's the key. For example; have flatmates, working two perhaps three jobs, public transit instead of operating a vehicle, buy second hand clothes etc.

SACRIFICE. It seems an offensive word for some reason.

[WarrenC12]

How about just rent? Invest your savings in other things. The "intrinsic value" of RE ownership is way overblown in my view.

[ckkelley]

Originally Posted by WarrenC12

How about just rent? Invest your savings in other things. The "intrinsic value" of RE ownership is way overblown in my view.

I have a feeling that most of the people participating in this thread will end up doing just that but not for the reasons you're advocating.

[Login650]

Originally Posted by trofirhen

As I said in my post (#20), the Australian government has come up with laws that specifically address that issue by requiring investors to be residents-in-fact of the properties they buy. This helps stop real estate from being a purely speculative commodity.

The province of New Brunswick has a similar regulation: non owner-occupied units are charged a provincial property tax on top of the normal municipal property tax. It effectively doubles the property tax.

So BC could do something similar, no need to wait for the Federal government to decide to regulate foreign investment.

[Yume-sama]

That is a pretty good way to guarantee rents will rise, or a shortage of rental units in general.

The cost will always be moved on to the next guy.

[whatnext]

Originally Posted by nova9

I'm trying to ask HOW Westerners owning multiple homes is different from this invasion of yellow peril?

Again, your inflammatory choice of language makes it clear you're bent on painting anyone concerned about this issue as a racist. Well, if you had been around in the Cariboo 15-20 years ago, you would have heard me complaining about Germans doing virtually the same thing. Happy?

For the record, I'm not in favour of anyone owning a single family house in a residential neighbourhood as a rental investment. You can generally spot such properties pretty easily due to their neglect and lack of care compared to adjacent homes. I had an incident in one neighbourhood where the absentee owners decided to rent to a couple of hookers, who proceeded to run a brothel. Not the kind of thing you want happening around your kids.

For the same reason, I would never buy in the OV if the floodgates are now open for them as individually-owned rental properties. The systems in that complex are going to be finicky enough, without the added drama of trying to convince bottom-line focused investors on the necessity of preventative maintenance etc. I went through that particular nightmare in one of the early Concord buildings. The Feds should go back to encouraging investment in purpose-built rental stock IMHO.

[trofirhen]

Originally Posted by whatnext

The Feds should go back to encouraging investment in purpose-built rental stock IMHO.

Hear, hear!! That, and start putting in some regulations to stop Canada (Vancouver in this case) from being sold down the drain - to whomever.

[ckkelley]

Edit. 2MAR11

[madmigs]

Originally Posted by Login650

The province of New Brunswick has a similar regulation: non owner-occupied units are charged a provincial property tax on top of the normal municipal property tax. It effectively doubles the property tax.

So BC could do something similar, no need to wait for the Federal government to decide to regulate foreign investment.

I'm guessing by this that you don't and have never owned property in BC. In BC, the property home owner grant does a similar thing. To qualify you need to be a) the owner, b) a Canadian citizen or permanent resident and ordinarily reside in BC, c) the property is your principal residence.

Basically if your property taxes are less than $920, you pay $350, otherwise over $920, the grant is $570. Which for a property worth ~$265,000 works out to a little less than a 50% discount, at least in Burnaby.

But to play devil's advocate, even if the property tax is $5,000, doubling that is a drop in the bucket for a wealthy foreign(or domestic) investor, as the property itself would be worth over a million, and even at 1.5 million, a 1% value increase would easily cover the $10,000/year.

[madmigs]

Originally Posted by whatnext

For the same reason, I would never buy in the OV if the floodgates are now open for them as individually-owned rental properties. The systems in that complex are going to be finicky enough, without the added drama of trying to convince bottom-line focused investors on the necessity of preventative maintenance etc. I went through that particular nightmare in one of the early Concord buildings. The Feds should go back to encouraging investment in purpose-built rental stock IMHO.

A lot of strata councils have in place a limit on the # of rentals allowed in the building. Sure anybody who has a rental at the time over the limit is typically grandfathered in, but once the renter moves, and the building is still over-limit for rentals, the owner won't be allowed to rent it out to someone else.

But wouldn't that preventive maintenance that some owners won't want to do, pretty much restricted to that suite, so it primarily only affects whoever rents the place? It won't affect the maintenance, unless you are implying that they won't let the strata do the maintenance for the building. I've rented 3 different condos in 3 different buildings from different owners, before I bought my own. The 1st one, was upset at strata for not doing the maintenance/upkeep as the exterior was dirty and there were other issues in the building, both bringing the value down on his property. The 2nd one, I really don't know, but it was a terribly built rather new building for drafts, etc, in any case got out of there as soon as I heard they had plans to sell. The 3rd one, owned two condos in the building and was upset at the strata for not doing preventative maintenance and the exterior was dirty, had internal issues, the building was old and thus it was time to change the pipes, all bringing down the value of her properties. For both the 1st and 3rd condos, it was the resident owners that balked at the maintenance. As for my condo now, the strata here is doing the preventative maintenance, cleaning, and general upkeep.

As for more rental stock, I wholeheartedly agree. We need both more rental stock and ownership stock to help take some of the pressure off prices for both rental and ownership.

[nova9]

Originally Posted by whatnext

Again, your inflammatory choice of language makes it clear you're bent on painting anyone concerned about this issue as a racist. Well, if you had been around in the Cariboo 15-20 years ago, you would have heard me complaining about Germans doing virtually the same thing. Happy?

Yeah, happy. But it was only ever directed at you, not anyone else on the forum.

[whatnext]

Originally Posted by nova9

Yeah, happy. But it was only ever directed at you, not anyone else on the forum.

That may be, but it certainly comes across as trying to label anyone who was concerned about the issue.

I'm curious, you've said you're CBC and work in education - so wouldn't the rapid escalation of house prices would be as much of a concern to you as anyone else working a "regular" job in Metro? My folks immigrated to Canada in the early Sixties with a few hundred bucks and the promise of a job for my dad. At that time the price of a typical house was something like 2.5x his income. Now it is something like 10x. Without wealthy parents, how can anyone now coming out of university expect to be able to buy a house here? Shouldn't that be an issue of concern?

Edited to add: for some reason the link to the Sun article in your post 100 doesn't show up? Could you re-post?

[WBC]

Originally Posted by whatnext

That may be, but it certainly comes across as trying to label anyone who was concerned about the issue.

I'm curious, you've said you're CBC and work in education - so wouldn't the rapid escalation of house prices would be as much of a concern to you as anyone else working a "regular" job in Metro? My folks immigrated to Canada in the early Sixties with a few hundred bucks and the promise of a job for my dad. At that time the price of a typical house was something like 2.5x his income. Now it is something like 10x. Without wealthy parents, how can anyone now coming out of university expect to be able to buy a house here? Shouldn't that be an issue of concern?

That is exactly the issue at hand here. Without inheritance or massive amounts of money if you are just starting up you may as well pick up and leave because you stand no chance in hell of ever owning anything.

[Zassk]

Originally Posted by whatnext

My folks immigrated to Canada in the early Sixties with a few hundred bucks and the promise of a job for my dad. At that time the price of a typical house was something like 2.5x his income. Now it is something like 10x.

You need to compare apples to apples. The Metro Vancouver region is much larger now than it was in the 60's. The Port Mann bridge was built after your folks arrived, remember, which instantly pushed the affordable neighbourhoods further east by 20+ km. Never mind other things built after that, like SkyTrain. All of these things pushed "affordability" further east, long before Chinese speculators came.

There are still places to buy in the region for 2.5x income for a skilled labour job. (I'm assuming such job was equivalent to around $40K-$50K today.) But they are much farther out than they were back then. And more of them are condos, which reflects how society's opinion of density has changed.

To say that all houses cost 10x income is not true. It's only true in the "rich" part of the region.

[nova9]

Originally Posted by whatnext

That may be, but it certainly comes across as trying to label anyone who was concerned about the issue.

I'm curious, you've said you're CBC and work in education - so wouldn't the rapid escalation of house prices would be as much of a concern to you as anyone else working a "regular" job in Metro? My folks immigrated to Canada in the early Sixties with a few hundred bucks and the promise of a job for my dad. At that time the price of a typical house was something like 2.5x his income. Now it is something like 10x. Without wealthy parents, how can anyone now coming out of university expect to be able to buy a house here? Shouldn't that be an issue of concern?

Edited to add: for some reason the link to the Sun article in your post 100 doesn't show up? Could you re-post?

Well I'm currently at home still. Thankfully we have a big enough home but that allows me time to get my 'adult' life in increments. I'm paying for everything, don't get me wrong, but it certainly helpful to not have the pay rent while I accrue everything I need to take the plunge in buying property. I also don't plan on having children so my goal isn't a house or large apartment, I need 800sq.ft (which is expensive enough as it is). And even if I do buy, I wouldn't be able to afford Vancouver proper (since I want new construction).

But I guess in my head, I'm ready to make huge compromises.

But another thing I haven't really considered is the fact that I'm an only child so down the road.........I benefit since my immigrant parents do own their home.

[WBC]

This is a good read on what kind of place Vancouver proper is becoming. Kind of related to this discussion.

http://thetyee.ca/Opinion/2011/03/02/DowntownChasesKids/

[SpongeG]

when i was in my late 20's early 30's people my age who were buying houses were being given their down payments by their parents - we're talking $40,000 or so on average - myself i never got it as my parents have no money but a lot of people i worked with or knew had parents who did that - that was in the 90's... anyway those people my age who bought uin the late 90's can now afford $800,000 homes as they can sell their starters and move up the property ladder - one person i worked with her and her husband flip houses and seem to move every 16 months or something

[whatnext]

Originally Posted by nova9

Well I'm currently at home still. Thankfully we have a big enough home but that allows me time to get my 'adult' life in increments. I'm paying for everything, don't get me wrong, but it certainly helpful to not have the pay rent while I accrue everything I need to take the plunge in buying property. I also don't plan on having children so my goal isn't a house or large apartment, I need 800sq.ft (which is expensive enough as it is). And even if I do buy, I wouldn't be able to afford Vancouver proper (since I want new construction).

But I guess in my head, I'm ready to make huge compromises.

But another thing I haven't really considered is the fact that I'm an only child so down the road.........I benefit since my immigrant parents do own their home.

You certainly have my best wishes in starting out. I got on the property ladder 20 years ago, it would be much, much harder to so now. There are a host of reasons coming together to the City of Vancouver so unaffordable. (Bob Ransford had a good article on development charges HERE) Unfortunately civic government doesn't seem as interested in the looking at the issue of purchase affordability as affordable rentals.

[dleung]

A solution to the affordability crisis could be putting more focus on making the rest of Metro Vancouver desirable and urban. There's no point in finding new ways to cram people into the city proper via laneway houses or basement suites, when the rest of the metro is paving over paradise like there's no tomorrow...

[SpongeG]

yeah but thats what the people want, they drive the market, its quite sad how sprawly surrey is and its non-stop for years but people are keeping the single dwelling homes in demand - my friend for instance wants to buy a house or something more in surrey rather than what he can get in burnaby cause he doesn't think a townhouse or condo is good value for the money they will be spending and thinks the same money spent in surrey will get them a lot more but i tell him but its surrey and its so far