How skyrocketing Vancouver home prices are fuelling anger towards Chinese buyers
Laurent Vu The/AFP/Getty ImagesA recent poll found that two-thirds of metropolitan Vancouver residents believe “foreigners investing” is a main cause of high housing costs, and 70 per cent said the government should work to improve affordability.
VANCOUVER — After years of watching Vancouver housing prices climb, driven in part by Chinese investment, Eveline Xia came to a painful realization: Despite having a Master’s degree and solid career prospects, she might never be able to afford a home in the city where she grew up.
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That didn’t seem right, and so the 29-year-old grabbed a marking pen, hand lettered a sign listing her credentials, snapped a selfie, and posted it to Twitter under the hashtag #DontHave1million.
The tweet went viral, and hundreds of other young Vancouver residents soon began expressing their own frustrations in tweets about the red hot housing market – and the feverish foreign investment they believe has fueled it.
“Average, hardworking Canadian residents are being forced to compete for housing with the global wealthy,” said Xia, who immigrated to Canada from China as child. “People here are getting angry.”
That anger has contributed to a simmering xenophobia in Vancouver, a multicultural coastal city long known for its inclusiveness. With virtually no official data on foreign buyers available, many of those squeezed out of the market are left to believe the worst.
That has residents like Xia pressing the government to track international buyers, scrutinize the source of their funds and tax property speculation, before the anti-Chinese sentiment gets out of hand.
Last summer, a small anti-immigration group covered up Chinese symbols on real estate signs in the affluent suburb of West Vancouver with stickers reading “Please Respect Canada’s Official Languages.”
And police are investigating incidents on neighbouring Vancouver Island, where anti-Chinese pamphlets appeared in affluent neighborhoods and signs for Chinese real estate agents were defaced with racial epithets and messages like “Go home” and “Not welcome.”
A recent poll found that two-thirds of metropolitan Vancouver residents believe “foreigners investing” is a main cause of high housing costs, and 70 per cent said the government should work to improve affordability.
SKYROCKETING PRICES
In the last five years, the median selling price for residential properties in Vancouver has jumped 57 per cent to $1.1 million, according to data compiled by Reuters from the Real Estate Board of Greater Vancouver. The price of detached homes has soared 82 per cent, to $2.1 million. The median household income, meanwhile, has risen by an estimated 13 per cent in the same period, according to Statistics Canada.
But since the government keeps no records on the nationality of home purchasers, evidence that money from China is driving up housing prices is largely anecdotal.
In interviews, five real estate agents who primarily sell homes on Vancouver’s exclusive west side estimated that between 50 per cent and 80 per cent of their clients have financial ties to mainland China.
By not addressing it, they’re letting anger and resentment build through whispers and at dinner parties
A Reuters survey of 50 land titles for detached Vancouver Westside homes that sold for more than $2 million in the last year found that nearly half of the purchasers had surnames typical of mainland China, as distinct from those of earlier waves of immigrants from Taiwan and Hong Kong.
There was no way, however, to determine the citizenship or residency of those buyers. And indeed, many wealthy newcomers from mainland China are permanent residents of Canada.
Activists like Xia are pushing the government to at least start tracking foreign buyers and to make the information public.
“By not addressing it, they’re letting anger and resentment build through whispers and at dinner parties,” said Xia.
THE CANADIAN PRESS/AP-Jae C. HongIn the last five years, the median selling price for residential properties in Vancouver has jumped 57 per cent to $1.1 million, according to data compiled by Reuters from the Real Estate Board of Greater Vancouver.
CAPITAL FLIGHT
Residents also have questions about the source of Chinese money being invested in Vancouver property, a concern that came to the fore last year when a prominent developer in the city, Michael Ching Mo Yeung, was named as one of the top 100 fugitives wanted by China as part of ‘Operation Skynet’.
The campaign is part of President Xi Jinping’s pursuit of suspected corrupt officials who have fled overseas.
In the wake of news about Ching, there have been calls for greater scrutiny of foreign buyers and tougher enforcement of anti-money laundering standards.
“I would love someone to look into the due diligence standards [for real estate brokers] around ‘know your customer,’” said James McDonald, who runs a blog that maps million-dollar homes that sit empty after being purchased by speculators.
He and others note that many properties are purchased by trusts or companies that aren’t transparent.
But not everyone is convinced that Chinese money is primarily responsible for the rise in housing prices, noting that it has also been fueled by interest rates that are near record lows and a tight supply of detached houses.
THE CANADIAN PRESS/Darryl DyckVancouver mayor Gregor Robertson in May called on British Columbia’s government to impose a speculation tax.
“The reason why we’re seeing this racialized narrative is people are looking for a scapegoat,” said Victor Wong, the Toronto-based executive director of the Chinese Canadian National Council.
“It’s infected the population,” he added. “People have bought into this narrative that there’s a flood of foreign money into the market when there’s just no evidence beyond a few anecdotes.”
MIXED FEELINGS
With frustrations mounting, Vancouver mayor Gregor Robertson in May called on British Columbia’s government to impose a speculation tax.
The province declined, saying there was not enough hard evidence that foreign money was driving the market and that a new tax could hurt existing homeowners.
But even those who benefit from the housing boom have mixed feelings. At a recent open house in Vancouver, real estate agent Fatemeh Nouripour watched group after group of prospective buyers, most of whom appeared to be from mainland China, trudge through a fixer-upper listed for $1.58 million.
“As an agent, I want to sell to whoever will pay the most,” Nouripour said. “But I’m also a mother. My daughter has a Master’s degree, she works hard and pays taxes, and she can’t afford to buy because foreigners are parking their money here. How fair is that?”
© Thomson Reuters 2015
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