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The collateral damage in Vancouver’s market

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Justin da Rosa | 12 Sep 2016, 08:15 AM Agree 0
The Vancouver foreign buyer tax is hurting homegrown investors, according to one
  • Tony | 12 Sep 2016, 01:41 PM Agree 0
    Poor Hans... Everyone feels so sorry for you
    • MFenn | 12 Sep 2016, 08:28 PM Agree 0
      This comment just goes to show the sort of ill informed sentiment which is driving this head-tax-by-another-name aimed at driving away investors. It's just not how markets work. Diefenbaker enjoyed ranting against foreigners and Bay Street, but Dief's huffing and puffing never achieved anything positive; nor will driving away investors today.
  • Kread | 12 Sep 2016, 01:50 PM Agree 0
    So you don't mind selling your property for inflated value when the money comes
    fraudulently from overseas scam artists who borrow money from Chinese banks for investment
    in China them disappear to Vancouver to buy mansions with no intention of paying it back?
    • MFenn | 12 Sep 2016, 08:37 PM Agree 0
      Does the poster seriously propose a racial bar to property purchasing? or is support for this 15% tax really being defended on racial-specific grounds? It also shows ignorance of how markets work: euphemisms such as 'opting to preserve the stability of the neighbourhood' - used to defend quite illegal schemes to shut out Chinese buyers mask a complete illusion that property markets function differently according to the national origin of the buyer, as if money will somehow function differently according to where the buyer is in the process of obtaining landed status.
    • Concerned Dad | 19 Sep 2016, 02:09 AM Agree 0
      The law is for any foreign buyer, before the law many were saying that it was not just Chinese, now that tune has changed. Sorry Canada and Canadians first, and if that is being prejudice then YES I'm prejudice. Try and buy a place in mainland China and see how you go. The Indonesians are smart enough not to allow ANY foreign buyers, understanding that they will not be able to afford to live in their own country if they do. This IS HAPPENING RIGHT NOW. MY CHILDREN CANNOT AFFORD TO LIVE IN VANCOUVER EVEN WITH SALARIES THAT WOULD BUY A MANSION IN MANY OTHER PARTS OF THE COUNTRY. If the tax brings prices more in line with salaries it will have done a good thing, and sorry to anyone who thought they won the lottery by buying a shack in East Van 20 years ago.
  • MFenn | 12 Sep 2016, 01:59 PM Agree 0
    I don't quibble with the terms 'hurtful' and even 'ridiculous', used above.

    One supposed property market for foreigners and another supposed property market for Canadians is an illusion. Investors comparatively have some confidence in Canada and this is a good thing, not a bad thing. This confidence needs to be respected and enhanced; the last thing needed is to drive investors away. Driving investors away is what this draconian, unconsulted tax measure does. "Drive investors away and feel better" is not going to make Canada's economy stronger.

    And it's an illusion to think that - Diefenbaker style - saying "Go away Bay Street and overseas investors" will make the property market and Canada's economy stronger. It's illusory populism which didn't work for Dief - for all his nationalist huffing and puffing - and it's not going to work now.

    To all the supposedly professional realtors who were complaining about Chinese buyers before the 15% tax was introduced in BC - and yes many did, there's no denying it - and to all the supposedly professional realtors who have subsequently gloated about the discomfort of Chinese buyers since the 15% tax had been introduced - and yes many did, there's no denying it - it's not your role to stir up racial specific hostility to a particular demographic of buyers. I think measures need to be taken by realtor associations to curb this unprofessional behaviour.

    And with over half of Torontonians originating from someplace other than Canada, how can it be possibly right for backward-looking nativism to be introduced into the Toronto property market?

    This head tax by another name all reminds me not only British colonialists but also a little of Malaysian politics, where one class of participants in the market proclaim themselves the 'sons of the soil' and then proceed to penalize 'foreigners', i.e., Chinese, on whose entrepreneurship and investment the economy substantially relies.
    • Concerned Dad | 19 Sep 2016, 02:11 AM Agree 0
      The law is for any foreign buyer, before the law many were saying that it was not just Chinese, now that tune has changed. Sorry Canada and Canadians first, and if that is being prejudice then YES I'm prejudice. Try and buy a place in mainland China and see how you go. The Indonesians are smart enough not to allow ANY foreign buyers, understanding that they will not be able to afford to live in their own country if they do. This IS HAPPENING RIGHT NOW. MY CHILDREN CANNOT AFFORD TO LIVE IN VANCOUVER EVEN WITH SALARIES THAT WOULD BUY A MANSION IN MANY OTHER PARTS OF THE COUNTRY. If the tax brings prices more in line with salaries it will have done a good thing, and sorry to anyone who thought they won the lottery by buying a shack in East Van 20 years ago.
  • Invest in Alberta | 12 Sep 2016, 02:37 PM Agree 0
    All investors are welcome in Alberta, and stand to make a fortune when oil prices rebound!!!
    • MFenn | 14 Sep 2016, 12:05 AM Agree 0
      The self-inflicted collateral damage of one Province does not need to drive investors away from another Province! (Self-inflicted collateral damage = polite way of saying politicians shooting themselves in the foot.) I would not be unhappy to see Calgary joining Toronto as a fairly permanently safe go-to real estate market for investors. But what one likes is irrelevant; it's really all about investor confidence: a confidence which some BC politicians evidently think is somehow irrelevant to them.
  • early | 13 Sep 2016, 12:24 PM Agree 0
    Sounds like sour grapes from Mr. McFarlane and I don't have any sympathy for him. The tax is having the desired effect, and rightfully so. This speculative, frothy market needs to be cooled down.
    • MFenn | 13 Sep 2016, 09:56 PM Agree 0
      If you think gloating about overseas investors deciding to invest overseas instead will actually strengthen the Canadian economy, you don't know how markets work. This 15% tax aimed at "foreigners" (euphemism in Vancouver for Chinese) basically sends the message: "Investors go away! We nativists have less confidence in the market than you do!" And even from the delicate point of view of those who fear their job security and house buying power, driving away investors and entrepreneurs makes no sense, either.
    • Anthony | 19 Sep 2016, 02:16 AM Agree 0
      We seldom look at the long term in this society. Make a quick buck and move on. Well soon enough you'll have to move somewhere other than Vancouver because it will be too expensive for all but the very rich. Furthermore, who is going to fix their toilets? We are pushing the middle class further and further from the city and soon enough only the luck few will be able to afford to live within a reasonable commute. If this tax can slow that trend, then yes it is having the right effect.
  • Cal | 13 Sep 2016, 07:57 PM Agree 0
    The 15% Foreign National Tax combined with the Assignment legislation on May 16 and the February government imposed 3% Luxury Tax has all contributed to a significant slow down in the markets where foreign buying was the greatest. The Real Estate Board of Greater Vancouver and the British Columbia Real Estate Association have both stated publicly that we are back to normal August sales numbers. Nothing could be further from the truth especially in West Vancouver and the other affected areas. There was a definite slowing in the market when the Assignment legislation was announced May 16 but the August 2 Foreign Tax deadline basically shut the door.

    West Vancouver detached sales in August are off 78% compared to August of 2015. We have 1 detached sale so far in September in all of West Vancouver. There were 73 sales in September of 2014 and 84 detached sales in August of that year. So, we are a long way off from being back to a normal market.

    The government needed to try to cool things down and anyone who was surprised when the government imposed a foreign tax was naïve. It was the severity of the tax and the implementation process that was the surprise. I also think the significant slow down of the markets has surprised the government in its severity.

    My only request is that when we move into markets as quickly as the one we are now in, the Real Estate Board and BCREA publish data and statements that are accurate so that buyers and sellers can make informed decisions.

    • MFenn | 14 Sep 2016, 12:10 AM Agree 0
      Yes, well, re. the severity of the slow down, like with Walter Gordon and Diefenbaker years ago, by trying to buck the market and defying investor confidence, the BC government seems to have shot itself in the foot. Bishop Butler in the 18th century said: "If things and actions are what they are, and their consequences will be what they will be, then why should we wish to deceive ourselves?"
    • Anthony | 19 Sep 2016, 02:00 AM Agree 0
      How about lowering prices to something "reasonable" like only double what places are worth instead of 3 times, then they will sell. Sorry for those that paid too much, but seriously, does anybody believe that the increase in prices that we have seen over the last 18 to 24 months is sustainable? Who's going to work at Starbucks, people commuting from Abbotsford or Hope?
  • WP | 18 Sep 2016, 04:40 PM Agree 0
    Market cooling was needed and will only be temporary.

    The Chinese (and yes other foreign buyers) face similar, if not harsher restrictions in most other jurisdictions.

    Our low Canadian dollar, relatively safe/clean living and welcoming immigration policies (see social services) guarantees a return of those offshore dollars in the long term.

    While in the short term, the province will be scrambling to make up the shortfall in the Property Transfer Tax that they're about to see in the coming months..though that's post election so no big concern for them right now.
  • MT | 19 Sep 2016, 08:38 AM Agree 0
    Sometimes it's hard to tell whether this is a news outlet or just a place for people to vent when their income is negatively impacted for the better of generations to come.
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