Foreign property buyer restrictions needed?

Is the Vancouver real estate market being driven by foreign buyers? At least one former city councilor seems to think so:

Peter Ladner says Vancouver’s home prices are out of control, and with China and Australia already restricting foreign ownership, Vancouverites should at least examine whether the idea makes sense.

Tsur Sommerville thinks it’s a non issue:

“If you go back to the 1980s, and the worry about Hongcouver, and all these kinds of things, Vancouver has been through this story before and I think most people think this city is better off now than it was in 1987,” said Somerville.

Full article at the CBC.

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patriotz
9 years ago

@vancouverseniorsecondarymarket:

You can short real estate.

No you can't. You cannot borrow a property and sell it in return for a promise to return the property in the future. That is the definition of short selling.

I know there are some futures markets where you can make bets about the performance of some RE indexes, but that is not short selling RE. Short selling is the sale of the actual property as I explained above.

ReadyToPop
ReadyToPop
9 years ago

Yup…the family-bashing money-printing folly knows no borders…..

Not Ready To Be Slav
Not Ready To Be Slav
9 years ago

Bull and UBC professor talking about this article http://www.theglobeandmail.com/globe-investor/inv… but really didn't touched the RE and GDP correlation (the most interesting point). They also distorted the facts from the article.

have a look:

http://watch.bnn.ca/#clip448559

I hope this professor building some skills for another job because he will need it soon.

real_professional
9 years ago

This has been a crazy week – the news keeps coming!

Now, Hong Kong to Use Auctions to Curb Surge in Housing Prices.. The Chinese credit bubble has spilled into

http://www.bloomberg.com/news/2011-04-14/hong-kon

Anonymous
Anonymous
9 years ago

From the post article: "The Canadian housing market is booming, and some economists fear it could come crashing down."

"Some economists fear it 'could' come crashing down"? Imagine if those economists feared it 'will' come crashing down. Those economists, they’re a bunch of crazy guys!

vancouverseniorsecon
vancouverseniorsecon
9 years ago

You can short real estate.

McLovin
McLovin
9 years ago

Go Canucks!

patriotz
9 years ago

@Devore: No we shouldn’t, speculators are an essential part of markets, investing, risk management, and price discovery. That only works when: 1. Speculators assume ALL risk from their activities. 2. Speculators can bet on the downside (short sell) as well as on the upside. Since government is holding the bag on RE lending (and is unlikely to get out of it for years if ever), and RE inherently cannot be short sold, speculation in RE misallocates capital and puts the taxpayer at risk and the government should attack it with punitive taxation. You can leave the oft-maligned condo pre-sale buyers alone though, as they actually do add liquidity to the market at their own risk. And as it is their gains (which are on futures) are fully taxable as income (rather than taxable on 1/2 of gains). The people who… Read more »

frank
frank
9 years ago

Ok guys Ladner’s idea is a good if six or more years too late. of course remember Ladner was the Olympic pumper/Millenium guy and he turned his knife on his buddy Sam Sullivan in a City Hall coup, so lets not forget that. BTW- he also lost his sister in the unsolved Pacific Spirit murder and my deep sympathies to him on that issue. Now here is something we bears keep forgetting – we have a very rich social safety net. I have two friends (guys) who have basically been off with a disease (that I will not mention) for most of their working lives. They seem in pretty good health and volunteer in several places. WIth the costs of their meds and doctors and disability I would hazard a guess that they are a $40K cost each to the… Read more »

Anonymous
Anonymous
9 years ago

Just awhile ago, I received my usual VOW auto-update. My parameters are: SFH, Port Moody, Coquitlam, Port Coquitlam. $200,000-$650,000.

I received THIRTY-ONE listing alone today. That’s the highest number I have ever seen these past few years.

And, the list for condos in the sole “Port Moody Centre” area are exploding. FOUR today. (That is a lot, BTW).

Anonymous
Anonymous
9 years ago

Ladner’s Chinese rant ignores economic boom – Former councillor hits out at immigrant buyers

“Mainland Chinese immigrants are moving to Metro Vancouver at the rate of 10,000 a year,” Ladner said. “These immigrants are in some sense political and economic refugees, securing citizenship in Canada as a backup plan for their children’s futures.”

http://www.theprovince.com/business/Ladner+Chinese+rant+ignores+economic+boom/4605711/story.html#ixzz1JSPAq1l5

VHB
VHB
9 years ago

April 2011 month-end projections
Days elapsed so far 9
Days missing 0
Days remaining 10
5 Day Moving Average: Sales 146
5 Day Moving Average: Listings 296
SALES
Sales so far 1306
Projection for rest of month (using 5day MA) 1460
Projected month end total 2766 +/- 326
NEW LISTINGS
Listings so far 2622
Projection for rest of month (using 5day MA) 2956
Projected month end total 5578 +/- 475
Sell-list so far 49.8%
Projected month-end sell-list 49.6%
MONTHS OF INVENTORY
Inventory as of March 31, 2011 13110
MoI at this sales pace 4.74

VHB
VHB
9 years ago

Dailies – List | Sold

Vancouver East & West*

New Listings – 95

Back On Market Listings – 2

Price Changes -21

Sold Listings -52

Vancouver All Areas*

New Listings – 303

Back On Market Listings – 2

Price Changes – 105

Sold Listings – 150

*Attached & Detached – Date: 04/13/2011 Time:18:10 Pacific YatterMatters.com: Courtesy REBGV. Data believed to be accurate but is not guaranteed.

Polly Pollyanna
Polly Pollyanna
9 years ago

@Devore:

“But what happens when millions of home buyers are speculating on leveraged million dollar assets, enabled by their governments and financial system? This is speculation gone wrong, that should have never been allowed.”

Harpo and the boys made an end-run for a majority and fucked up.

but they’ll get what they want in the end, a broken public that will submit to all kinds of neo-lib privatization.

Polly Pollyanna
Polly Pollyanna
9 years ago

@Devore:

i agree with you

shorting is an essential aspect of market pricing – without it, we’d still have enron around.

Chipper
Chipper
9 years ago

@specialfx3000:

"So many of these Chinese automatically conclude a ‘deal’ when there is lots of people lining up or hovering around something. It’s the mentality that if lots of people are interested, I think I’m interested too… Surely once I can get my hands on it, someone else will pay me more for it."

It may also be rooted in the "fear of missing out", routinely referred to as kiasu in Singlish.

real_professional
9 years ago

Two calls for political parties to address the real estate bubble in one week, this one from the “National Post”:

http://fullcomment.nationalpost.com/2011/04/13/jesse-kline-parties-silent-on-possible-housing-bubble/

Chipper
Chipper
9 years ago

@jesse:

"A vacant piece of land produces no economic benefit for the City and, in my view, Ladner is very correct that this should be considered as a net drain on the City’s future growth prospects.

Buying and holding empty houses purely for profit must be discouraged. Were this practice to become widespread the effect on those wanting/needing to rent here would be absurd. Imagine those neighbourhoods around UBC / BCIT / Kwantlen /SFU full of dark empty houses, yet facing uber demand for rental space by students, instructors and facility workers.

At least the municipalities get the economic benefit of collecting property taxes from the owners!

Patiently Waiting
Patiently Waiting
9 years ago

"less intelligent people own rental properties. chinese or white or indian or whatever. there’s idiots everywhere, it’s vancouver."

True, the slimeball landlord I finked on to the CRA is a white guy. He runs a successful business outside of landlording but somehow he didn't know the landlord-tenancy rules (or couldn't be bothered).

Devore
Devore
9 years ago

@Devore: Gah, premature submission.

This (banning speculators) is the kind of knee-jerk reaction that makes really bad economics. Speculation (and other “villified” methods like shorting) should not be banned, because they are in fact needed. But they should not be subsidized or encouraged either. They must bear the cost of bad decisions, just like they should be rewarded for getting it right.

But what happens when millions of home buyers are speculating on leveraged million dollar assets, enabled by their governments and financial system? This is speculation gone wrong, that should have never been allowed.

Devore
Devore
9 years ago

@VANCOUVER_RE_SUCKS:

Speculation are bad. we should ban all kinds of speculations.

No we shouldn’t, speculators are an essential part of markets, investing, risk management, and price discovery.

Devore
Devore
9 years ago

@jesse: No, they probably took the easy route, and asked around the local Remax office 😉 "Hey, any bears around here?"

Dave
9 years ago

Peter Ladner should worry more about municipal taxes and levies, not with sales levels.

Polly Pollyanna
Polly Pollyanna
9 years ago

@Patiently Waiting:

"A little while ago, I had a verbal discussion with a Vancouver Sun staffer about their real estate coverage. In the end, he basically said times are tough and you gotta do what you gotta do."

here's a forecast for you

say the bubble bursts – badly – and Pacific Press starts hemorrhaging ad revenue.

i guess we'll be left with .. the metro? the tyee? lol.

southseacompany
southseacompany
9 years ago

Re: vancouver Sun & real estate coverage.

Those of you old enough may remember the 'leaky condos' of the 90's. I remember a Georgia Straight article, back then, by a reporter named Ben Parfitt, who worked at the Sun and tried to start a weekly feature on the issue. A few installments on the issue were published, but then it was shut down. Parfitt alleged that advertisers threatened to pull ads. He left the Sun soon after.

More here:

http://books.google.ca/books?id=f-Bu6KzhtHgC&…