In response to the Mayor of Vancouver’s letter to the Premier, advocating provincial intervention in the housing market, the B.C. Ministry of Finance produced an analysis:
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Key phrase: “Estimates of foreign investment in BC’s housing market are subject to considerable uncertainty due to a lack of conclusive data.” And here is what the Ministry recommends, according to Business in Vancouver (which also has the full document above)
The Ministry of Finance analysis said the B.C government could encourage local governments to address affordability through local taxes and planning measures such as:
• Adopting growth strategies and plans that encourage affordable housing units.
• Nurturing a regulatory environment that is “housing-friendly” and encourages densification.
• Offering property tax incentives and targeted reductions to build or renovate affordable housing.
• Streamlining development approval processes.
Nowhere is there a recommendation to get more conclusive data.
Some senior governments have adopted a strategy in the last decade to stop collecting data, limit its access or make it voluntary (and increasingly useless) – and then, as seen above, use the absence of data as a reason not to pursue action. (It’s the Prime Minister’s chosen strategy to deal with climate change: ‘Don’t deny, just don’t discuss, don’t document, and don’t allow any civil servants to do so either.’) It’s a dangerous strategy, since it increasingly allows rumour, innuendo and falsehood to fill the void.
The failure to collect data needs to be challenged, to be a political issue itself, and not used as an excuse. And increasingly, it is.
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“Streamlining development approval processes.” etc! What nonsense. They know if they want to know . . .
Spot on Roger
I have yet to be convinced that foreign investment in Vancouver’s housing market is a significant contributor to crazy sticker prices for new and existing homes (rents are roughly on par with Alberta). So far ALL of the evidence I’ve heard in support of greater foreign regulation is anectodal. If you want the assertion proven, then the burden of proof is on you. Not the province, which already has a position.
It’s true that the province’s position is a little too cute and convenient (for the province) – that the city should quit whinging about the Chinese and just build more housing. It’s discomforting to support the Premier in much of anything, but about this I can’t disagree. If you simultaneously complain about high housing prices yet fight new housing at almost every turn, then you’re not being realistic. Your position simply boils down to wishing everyone would just go away and quit wanting what you already have.
Dan, don’t you find it suspect that there is no data? Similar to Harper closing all scientific research institutes and destroying years of climate data to stifle the movement against Climate change reform. When you remove the data or in this case refuse to collect the data, I would argue you are attempting to maintain the status. I would like to flip this around and say, Show me the data that foreign buyers are not influencing the market
I agree that the lack of data is not ideal and can lead to unsound choices. But I think the burden of proof should be on those trying to make the assertion, not on the province to disprove it. In the case of climate change, the assertion has been proven and still the province would rather not hear it. If independent analyses conclusively show that foreign investors are the major factor in high home prices and the gov’t still opts for selective ignorance, then that’s a bigger problem.
Until then, it’s a correlative situation (lots of foreign investors and high home prices at the same time) that seems intuitive to many people but may not be causative.
When there is little or no data, then partisan dogma, political ideology and other unsupported assertions are as good as it gets to underpin decision-making. This plays well with demagogues and those who prefer a dictatorial style of government.
dj We’ve been that route. Perhaps you forget, not too long ago, people lining up to buy mulimillion dollar homes and to look at them they could hardly afford buy a decent pair of pants!
The requests by senior to junior government’s listed are ALL valid points as is the need for more data . If 5% of properties in MetroVan are foreign owned but concentrated on 15% to 20% of the area and within that area on 30% of all housing types, namely single family homes, then a vast majority of single family homes on most desirable areas of W Van, N Van, Van West, Richmond and Surrey pockets are foreign owned or foreign influenced . It is plain obvious by walking around and listening to the any non-English speakers.
Are we second nation people (speaking English) allowed to use the term ” cultural genocide ” here or is this false label only allowed for first ” nations ” people ?
Speaking from one minority to another …
Speaking of data, here are some data and analysis of it from the BC Real Estate Association.
http://www.bcrea.bc.ca/docs/economics-publications-archive/2015-06-foreign-buyers-research-report.pdf
Good insight, but too coarse. Conveniently missing is the % of foreign ownership in single family houses in good locations, which is likely far far higher than 5%. If 5% is concentrated on 30% of the area in MetroVan and SF houses comprise 30% of that area then it implies that 50% of SF homes in desirable areas are foreign owned !
Also missing is the fact that a large % of transactions are not owned by foreigners, but influenced by them, or routed through Canadian corporations or trusts, or relatives living here (brother, sister, uncle, nephew, ..) ie while technically not foreign it is foreign money.
Thirdly missing is the taxation issue as much abuse is done here. Many a home is stated as “personal residence” but is actually not a residence and certainly not the only residence, and as such property taxes, land transfer taxes, and certainly income taxes on resale are far FAR too low. We need to link property ownership to the income tax filing system, as the capital gains exemption is widely abused in Canada.When a house is classified as a “personal residence” then it would imply to me that the owner files his/her world wide income here. Is this the case ? I’d argue “no” in many cases !
We have an affordability problem, a homeless problem, a teachers’ and healthcare underfunding situation because properties are grossly undertaxed, especially those not used as primary residences but as investments by foreigners or affluent immigrants, often here merely to get a passport, while still using our services such as education/ESL, policing, parks, street cleaning, transit or healthcare for themselves, their elderly parents or kids.
Don’t stop immigration or foreign money coming here, but MONETIZE IT FAR MORE.