advice, BC, equity, repairs

Strata council fraud nets house arrest

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64 Comments

George pointed out this this story about a strata council member who bilked condo owners out of $160K.

The moral of the story?  Check your strata documents carefully and don’t accept photocopies of photocopy receipts.

In court Monday, Patrick Au was also given two years probation and ordered to pay back the entire $160,000. He pleaded guilty to theft and fraud over $5,000.

Au was a volunteer member of the strata for Gardenia Villa, a 250-unit condo building near Broadway and Nanaimo Street in East Vancouver.

Over a four-year period, starting in 2001, Au slowly took control of the strata’s finances and started siphoning off funds for his personal gain.

If the name Gardenia Villa sounds familiar, it may be because it’s been in the news before as the unfortunate leaky condo where the repair bill was higher than the construction cost.

Read the full article here.

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Melba

…. And almost 70% of the purchases made by Chinese buyers in the United States were made entirely in cash, according to the most recent report from the National Association of Realtors…

The NAR, that bastion of data integrity. :O=

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YVR

It’s the public perception of HAM, the incessant hype and marketing of HAM perpetuated by the real estate industry and media that’s responsible for brainwashing locals – rather than the actual buying by HAM that has been impacting the market. I think you would be surprised how little effect the real estate industry marketing has. There are always lots of nice stories that go along with any bubble. HAM just happens to be the one some around here get sucked into every time they see an Asian person near a house or condo. The part that drives any bubble is not the stories but fear and greed. Everyone hears of friends, family and coworkers who are getting rich in real estate. The fear and greed cause people make irrational decisions to get in on the action. Of course the easy… Read more »

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Son of Ponzi

Frankie,
As a soccer coach, I do this all the time.
Makes the game more challenging. 🙂

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Many Franks

@Son of Ponzi:

I was more looking for examples where someone earning 52k buys a 1million $ house.

That’s strange, it seems like the goalposts have moved since I kicked the ball.

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Son of Ponzi

Many franks,
I was more looking for examples where someone earning 52k buys a 1million $ house.
I understand that most people qualify for a 1 bed Bob Rennie presale special.

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Many Franks

@Son of Ponzi:

#50
“locals earning 50k ARE buying property”.
examples please!

Straight form the horse’s mouth:

Melanie is 28, a graphic designer, lives with her parents and makes $52,000 per year. She purchased a 1 bedroom unit at Sequel 138. With her annual salary of $52,000 she qualified under the down payment assistance program with no additional down payment.

Believe the anecdote or not — but don’t tell me they’re trying to appeal to HAM.

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fixie guy

@52 Don Lapre Says: “HAM is simply a nice story domestic purchasers tell themselves to gain comfort…” It’s not mutually exclusive. Has HAM had an impact in markets? Anyone who spends an afternoon in Richmond and still says ‘no’ needs professional help. Likewise revisiting what happened in Vancouver from ~1990 to 1995. These endless arguments are fueled on both sides by discounting common sense in favour of a simple magic bullet. Garth removes recent citizens from the HAM count as if a fortune earned off shore magically becomes economically irrelevant after pledging the oath. On the other side are local navel gazers refusing to recognize the rapid simultaneous increase in home prices across all of Canada, including areas shunned by Asian immigration, retreating into the comfort of “markets are local… markets are local….” The Canadian market at large is driven… Read more »

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HAM MAN

Reggy and Best Place on Meth, I do agree that the direct impact of HAM is not the only story.

There are no shortage of Canadians racking up large amounts of debt using cheap credit – partly because of a fear of being priced out by HAM (which greatly multiplies the impact of the real HAM.)

But it is an important piece of the puzzle in many locations in the country.

On an unrelated note:
For the first time ever, Vancouver has surpassed Los Angeles to become the most congested city in North America, according to a new survey.
Read more: http://bc.ctvnews.ca/vancouver-traffic-congestion-the-worst-in-north-america-survey-1.1530503

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Best place on meth

“Garth Turner comes as close as anyone to flat-out denying that HAM is having an impact on the market.”

In a way he’s right.

It’s the public perception of HAM, the incessant hype and marketing of HAM perpetuated by the real estate industry and media that’s responsible for brainwashing locals – rather than the actual buying by HAM that has been impacting the market.

That being said, it’s still the cheap and easy credit that is the biggest driver.

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Reggy

HAM MAN:”
Turner needs to pay a visit to my parking garage. Lots of very young Asian people who have recently arrived in Canada and are driving very nice sports cars”

he-he you are so naive. I was shopping for truck for my wife in the last two weeks. Do you know how much a new nicely equipped truck cost?
60k + Tax. Can you get BMW for that in Van? I am sure you can. Do you know what was the sale pitch from the sales guy?
“You can get 2 (TWO) trucks, not one, for you and your wife, on the spot, no money down. Just sign and drive.”

So here you go two shiny trucks for 130k with 15 minutes of paperwork.
i just laughed at the guy.

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Son of Ponzi

#50
“locals earning 50k ARE buying property”.
examples please!

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Don Lapre

HAM is simply a nice story domestic purchasers tell themselves to gain comfort with borrowing vast sums of money to purchase property at vastly inflated prices.

The gaping hole in the HAM theory playing any major part in the increase in property values over the last decade is the perfectly synchronized meteoric increase in mortgage debt over the same period.

From Vancouver to Calgary to Regina to Toronto, “RE is a no-brainer” drones have used borrowed money to increasingly bid up the price of property. Reduce or remove the ability to borrow ever increasing amounts of debt, the market will implode.

People will WISH HAM played any meaningful role at that point in time, as there will be nobody to sell their debt prisons to.

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HAM MAN

@49 Many Franks. Garth Turner comes as close as anyone to flat-out denying that HAM is having an impact on the market. http://www.greaterfool.ca/2013/02/14/the-myth-of-ham/ “So two years ago this pathetic blog arrived at the conclusion that HAM is as fake as MAC, The Key, Cam Good and the miscehievous little Amanda. ” “Of course, there is no statistical proof HAM has moved Van prices, at least directly.” “I said in 2011 that HAM was a myth, and today it’s being proven as such.” Turner needs to pay a visit to my parking garage. Lots of very young Asian people who have recently arrived in Canada and are driving very nice sports cars and living in new $500,000 condo units. I haven’t done a survey but it may be more than 50% of this building. HAM is alive and well. I’m not… Read more »

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Many Franks

@George:

Whites pushing the Chinese out of Vancouver. Too funny.

That’s Strathcona and Chinatown; I’m not claiming it’s a general phenomena. And a lot of the people being pushed out of Chinatown are just as Canadian as the people moving in [but let’s not start that conversation].

How can locals earning $50k a year and taxed to the hilt compete in a real estate market when we have corrupt officials from China literally stealing money from State Owned Enterprises.

That’s exactly my point — locals earning $50k a year *ARE* buying property. Isn’t that the whole premise of this blog? They’ve been buying it in droves, at tremendously inflated prices, and pushing prices even higher in the process. Isn’t that the bear orthodoxy in a nutshell? Doesn’t it logically follow from rising debt numbers, home ownership rates, and HGTV obsession?

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Many Franks

@HAM MAN: Try me. All it takes is one satellite kid, and hey presto, foreign money is active in Vancouver’s property market. Again, nobody’s denying that.

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Best place on meth

Yes, HAM does exist but hopefully they will be hunted into extinction soon. “The soon-to-retire Chinese bigwig who has stashed money and relatives abroad in preparation for his escape is such a common character in China that it has its own phrase: luo guan, or “naked official.” Some of them have laid the groundwork for years; one common ploy is to send a son or daughter overseas to a private university as a way to legitimize sending funds out of China. For example, the leaked Chinese central bank report on corruption showed that former ministry of finance official Xu Fangming deposited roughly 1 million yuan ($164,000) into the bank account of a son studying abroad. Perhaps not coincidentally, the number of Chinese students studying abroad has jumped in recent years. In the United States, it more than doubled to 194,000… Read more »

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George

@Many Franks Whites pushing the Chinese out of Vancouver. Too funny. That belies what I have seen in Vancouver. The neighbourhood I grew up in on the West Side is now vast majority wealthy Chinese. We only have anecdotal evidence of HAM. How about $30 billion invested by Chinese in foreign real estate in 2012–that’s a big number in the article I posted above–I would love to know what percentage of that made it’s way into Vancouver real estate. That article I posted on corrupt officials funneling money out speaks volumes about our real estate market. How can locals earning $50k a year and taxed to the hilt compete in a real estate market when we have corrupt officials from China literally stealing money from State Owned Enterprises. That report above says $123 billion were stolen from Chinese State Owned… Read more »

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HAM MAN

@44 Many Franks:
“Nobody’s denying that foreign money is somehow active in the marketplace.”

You’d be surprised.

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Reggy

@RealityCheck:

FYI:
new SFH in Regina is pushing 1 Mil. depending of luxury of the finish.
No Chinese though. but realtors are peddling the story that we have shortage of land!!!! There is 6 hours drive to the next big city (Winnipeg) and there is nothing in between, just land. I am confused.

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Many Franks

@RealityCheck: People who think that HAM isn’t the primary reason for the boom in home prices need to get their IQ’s checked… Unless they benefit in some way by arguing against it. I got mine checked. It’s fine. Nobody’s denying that foreign money is somehow active in the marketplace. But the RE industry has a lot to gain from promoting the HAM story. Who do you think they’re promoting it to? Hint: you’re here repeating it to us. Meanwhile, we don’t have many good stats — we have laughable proxies and anecdotes — “a clothing outlet being converted into Immigration Consulting office” — well, that anecdote ought to convince the federal government to intervene, don’t you think? The stats we do have show the effect being overstated, which is my experience here in Strathcona, where it’s pudgy white men pushing… Read more »

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patriotz

@36: “I believe REIN members would disagree with your assessment about borrowing to buy principle residence.”

Well they would, wouldn’t they?

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fixie guy

@28 RealityCheck Says: “People who think that HAM isn’t the primary reason for the boom in home prices need to get their IQ’s checked… Maple ridge and Abby have been stable at best in the last 5 years.”

Your zest for the myopic is inspiring. All of Canada has been on a tear for a decade. HAM is the main factor driving Winnipeg, Hamilton and Halifax too? In case you’re wondering: no.

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Barb Rennie

“Now the Chinese government is embarking on a worldwide hunt to seize the properties with help from foreign governments, according to asset recovery and anti-corruption specialists.”

Good luck with that.

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George

Check this article out: “Beijing goes hunting for overseas real estate bought with dirty money” From the article: “Now the Chinese government is embarking on a worldwide hunt to seize the properties with help from foreign governments, according to asset recovery and anti-corruption specialists. Since Wang Qishan, the Communist Party chief tapped to head China’s new anti-corruption drive, took office last fall, he has been pushing to crack down on capital flight from the country. In recent months, Chinese officials have quietly said they are specifically targeting foreign assets, and sought help from organizations like the OECD, anti-corruption groups and the foreign government agencies including the US Commerce Department about their newly aggressive pursuit of overseas real estate… In July, Canada and China agreed to seize, share and return the proceeds of crime… estimates run as high as 500 billion… Read more »

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