Trending
A red, white, and black flag with a white background.

Vancouver condo prices inflamed further by clandestine deals

Under-the-table transactions between developers, speculators, and a secretive faction of real estate professionals are playing a major role in the continuous upward pressure on condo prices in Vancouver, according to an investigation by The Globe and Mail.

In the six new high-rise developments investigated (with three still being built), The Globe and Mail found that at least 24 realtors were among the speculators who purchased units early. Meanwhile, 20 others were listed under the names of local real estate professionals, but stated their occupations as “businessperson” in violation of regulations compelling them to indicate their interest in a property to others involved in the sale.

An alarming 56 speculators were listed with either foreign addresses or no Canadian addresses altogether.

The investigation found that such insiders get first access to buy the cream of the crop, the most desirable units which get snapped up almost immediately and then flipped for outrageous prices – drying up Vancouver’s already scarce supply in the process.

Read more:

“It’s turned into insider trading,” according to real estate professional Shali Tark, who was not a member of the clique. Buyers with exclusive access purchase “not just one or two – some are buying lots. It’s all behind closed doors, and there is no regulation of who is getting what.”

The Globe and Mail also found that 56 flips (out of a total of 173) in three of the buildings investigated were by insiders and speculators apparently funded by foreign capital. These flippers earned an average profit of $145,759, with some getting as much as $513,200 per transaction.

Allan Ross, who has spent nearly 2 years looking for a high-rise condo under construction, said that he threw in the towel and settled for renting a home for his family in the meantime after learning that developers offer price lists exclusively for agents and select clients (almost always foreigners).

“The whole process is so unfair. It’s about greed and profits. It absolutely is manipulated before you even get a shot at it,” Ross stated. “It’s not a free market. There are different rules for different people.”

 

Related stories:
 

About the Author

Ephraim is currently a journalist at Mortgage Broker News, Real Estate Professional and Canadian Real Estate Wealth. Ephraim is a highly accomplished news reporter whose work has been published across North America and the Asia Pacific region. Before joining Key Media, Ephraim spent eight years working as a journalist with Reuters TV. His areas of expertise include real estate, mortgage, and finance. LinkedIn | Email  

Post a Comment

Related Articles

The Canada Revenue Agency (CRA) has introduced a new regulation that requires tenants renting from landlords residing outside of Canada to withhold a portion of...

If we are to put a significant dent in the housing crisis, we must tear down the overabundance of ridiculous and unnecessary barriers as well...

Most Trending News

The Canada Revenue Agency (CRA) has introduced a new regulation that requires tenants renting from landlords residing outside of Canada to withhold a portion of...

If we are to put a significant dent in the housing crisis, we must tear down the overabundance of ridiculous and unnecessary barriers as well...

Calgary has been the subject of discussion lately, with the city council’s decision to go ahead with blanket rezoning. How much impact this will have...