Foreign ownership of Canadian real estate

[Ozy_Flame]

Originally Posted by valo403

I think you're overestimating the number of foreign students and the number of Canadian students being displaced by them. There aren't a significant number of students that fit the description you've given, and even those that do aren't preventing top Canadian students from earning an education. They're bumping out the bottom rung, and I'd argue that hose on the bottom rung aren't typically going to make such dramatic impacts on the Canadian economy so as to be seriously missed. At the same time the increased tuition paid by foreign students allows for increased opportunities for Canadian students due to a decreased economic burden (or so it should, the way schools spend money is a different issue all together). I get your point, and I agree with it generally, I just don't think it's quite as big of an issue as it's being made out to be.

Fair enough. One man's mountain is another man's mole hill. I see it as a problem when specialized education grads, such as doctors, lawyers and entrepreneurs leave though. However, it's not everybody's beef.

[The Yen Man]

Maybe put a cap on how many properties someone can buy, or at least a time restriction before their next purchase. So maybe something like a person who bought one property can't buy another one for X number of months.

[THE SCUD]

Originally Posted by The Yen Man

Maybe put a cap on how many properties someone can buy, or at least a time restriction before their next purchase. So maybe something like a person who bought one property can't buy another one for X number of months.

Unfortunately this is impossible to do in the real world, given the inexpensive option of a foreigner using shell numbered companies to buy properties.

I think the right way to go is to have property title transfer tax on non residents (buy and sell) of something like 50%. Enough to stop turning our homes into the 21st century equivalent of swiss bank accounts.

[GP_Matt]

Originally Posted by THE SCUD

I agree, and that's why I am a propagation of something like a 100% property tax on these people - if they really need/want the place, they can pay huge for it. If they don't actually need it, they'll likely bugger off somewhere else to inflate property values at the expense of residents of that area.

If you assume that foreign ownership drove costs 10% higher (random number) then you are proposing a rule change that will drop the value of Vancouver area homes by the same 10%. The current homeowners of Vancouver would react to something like that the way Albertans reacted to the NEP.

[THE SCUD]

Originally Posted by GP_Matt

If you assume that foreign ownership drove costs 10% higher (random number) then you are proposing a rule change that will drop the value of Vancouver area homes by the same 10%. The current homeowners of Vancouver would react to something like that the way Albertans reacted to the NEP.

It's about time someone else felt the sting of the NEP

[redforever]

Originally Posted by bizaro86

I posted this in the other thread before I saw you had made this one. Reposting it for relevance here.

If you really wanted to discourage foreign ownership you could charge foreigners higher property taxes. Florida does this with the "Homestead exemption" where properties owned by full time Florida residents get a property tax discount.

On the other hand, foreigners buying real estate puts a lot of money into Canadian hands. The sellers get more than they would have, the real estate industry (agents, mortgage providers, renovators, etc) are all better off, and the gov't gets more taxes (withholding tax on foreign owned property).

It might force young people into renting instead of buying, but at current BC prices that might be a blessing for them, not a curse.

Has anyone checked if that is or is not done? We have friends from the Calgary area who own property on Mara Lake in BC and they get soaked big time on taxes...due to the fact that they are out of province owners of that property.

Now I am not sure if that is just due to the fact that they do not live there full time? They are non residents of BC as they live in Alberta.

I realize Mara Lake could be different from Vancouver...I am just wondering if Vancouver has something similar in place?

[bizaro86]

Originally Posted by THE SCUD

Unfortunately this is impossible to do in the real world, given the inexpensive option of a foreigner using shell numbered companies to buy properties.

I think the right way to go is to have property title transfer tax on non residents (buy and sell) of something like 50%. Enough to stop turning our homes into the 21st century equivalent of swiss bank accounts.

Anything punative directed against foreigners probably isn't great. Ultimately, the money from foreign investors is going into Canadian pockets/the Canadian economy.

If your goal is to make Vancouver/Canadian housing more affordable, you should focus your letter writing to the municipal level politicians. With less restrictions on developing new land and on increasing the density of the existing developed area, developers would increase the housing supply which would moderate huge price increases.

[GGG]

I get very angry when the US doesn't want our oil or our pipelines for arbirtrary reasons. Or when they get protectionist with their bailout money. I get mad when duty makes things more expensive for me as a consumer. I also have no problem with foreign investment making it more expensive for domestic oil companies to get oil out of the ground to do increase labour, material, and oil rights costs.

So for me it would be very hypocritical to say foreign investment in housing is bad. When I support free trade and foreign investment in every other aspect of my life.

Also how much of an affect is really attributable to foreign investment. I hear all of this fear mongering but I have never scene real numbers. Even if it is 20% that really doesn't make Vancouver an 'affordable' city. The real interesting thing in Vancouver is how cheap it is to rent places relative to the cost of housing. This provides excellent value to the people living there.

[seattleflamer]

Originally Posted by redforever

Has anyone checked if that is or is not done? We have friends from the Calgary area who own property on Mara Lake in BC and they get soaked big time on taxes...due to the fact that they are out of province owners of that property.

Now I am not sure if that is just due to the fact that they do not live there full time? They are non residents of BC as they live in Alberta.

I realize Mara Lake could be different from Vancouver...I am just wondering if Vancouver has something similar in place?

I mentioned it in the other thread that there is a Home Owner Grant which applies a discount to your property tax bill but it is capped. In order to qualify for grant, you need to be a. a Canadian citizen/landed immigrant and b. use the home as your primary residence.



Link: http://www.sbr.gov.bc.ca/individuals...rant/about.htm

[Winsor_Pilates]

Originally Posted by THE SCUD

What is CP's opinion on the huge influx of offshore asian real-estate investment in the Vancouver region (GVR) that has created an environment such that the hard-working Canadians who live there can't afford a decent home?

I don't live there, but it pisses me off, so I wrote the following to my MP:

My opinion is that this statement is simply not true so the rest of the discussion in the thread has been based on something that isn't even factual.

Please provide some evidence that demonstrates a "huge" amount of Vancouver real estate is being bought by foreign investors. And by foreign investors, I mean foreign investors; not Chinese immigrants.

[bizaro86]

Originally Posted by GGG

Also how much of an affect is really attributable to foreign investment. I hear all of this fear mongering but I have never scene real numbers. Even if it is 20% that really doesn't make Vancouver an 'affordable' city. The real interesting thing in Vancouver is how cheap it is to rent places relative to the cost of housing. This provides excellent value to the people living there.

Exactly. Having somewhere to live is a need. OWNING a place to live is not a need. If real estate prices have gone up huge due to investment demand, but no more people are moving in, rental prices would stay low.

So rent instead of buying.

[Winsor_Pilates]

Originally Posted by GGG

Also how much of an affect is really attributable to foreign investment. I hear all of this fear mongering but I have never scene real numbers. Even if it is 20% that really doesn't make Vancouver an 'affordable' city.

It's complete fear mongering.
It's hard to track but the best estimates put it somewhere around 1-2%.
The reality is that these buyers are moving to Vancouver as investment class immigrants. Vancouver gets 75% of Canada's immigrants in this class, and a few thousand each year.

That class of immigrant has to have over $1.6 million in assets & invest half of that($800,000) for 5 years with no claim back and no interest.
These people are given permanent residency with their class of immigration and they are the ones buying up most of the real estate.

It's not even these empty condos that keep going up; it's the detached housing in Vancouver West that has gone up over 20% in the last couple of years because it's being bought by these immigrants to live in and in areas with good schools for their kids.
I assure you, those houses are not all sitting empty.

The benchmark price on condos has increased less than 10% in the last 4 years, and it's a buyers market for condos right now.

Some of these immigrants will also use their wealth to invest in multiple properties and that's where the fear mongering comes from. People see a rich chinese person come into a Presale and buy 4 condos, and assume it's some foreign money holding scheme.
Then they see some stat saying prices have gone up 20% and assume it's on everything, when it's really only houses.

I've sold over 900 condos in Vancouver, and can hardly remember any of them being bought by a foreign investor who wasn't present and a resident of Canada.

Some real numbers:
-Almost 50% of Downtown Vancouver condos are rented
-The sales to listing ratio right now is about 15%. Considered the low end of a balanced market by most, but I'd say it's a buyers market for condos.
-Many Presales sold in 2007 are underwater now and have a ton of empty listing trying to be sold off. Buildings like Patina, West Pender Place, Dolce, Vita, Fairmont Pacific Rim. Buyers in these will take a hair cut if they sell now.

What the OP really needs to write letters about is immigration, & I'm sure Anders will be on board with reading that too.