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BC Introduces New 15% Foreign Buyers Tax - Update: Student Files Class Action Lawsuit


DonLever

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On 7/26/2016 at 1:00 PM, Warhippy said:

Well so much for a mere 3% over 19 days.  DeJong was pretty smug about stating it didn't have any significant or appreciable effect on the housing market.  Now after 5 weeks it's 10%.  Wonder what this will look like after a full fiscal year?

 

http://www.cbc.ca/news/canada/british-columbia/vancouver-real-estate-foreign-data-1.3695439

 

Foreign buyers spent more than $885 million on Metro Vancouver real estate in just five weeks, according to new data released by the B.C. government.

The money represents about 10 per cent of the value of all real estate purchased in the region over that span, the government said.

The release comes just a day after B.C. announced a 15 per cent property transfer tax on foreign buyers in the Metro Vancouver real estate market.

Many critics have speculated that foreign capital coming into Vancouver is one reason real estate has become increasingly unaffordable, with locals unable to compete with foreign investors.

Earlier this month, the B.C. government released initial findings from its foreign buyer study.

 

That data — which looked at a twenty-day period spanning from June 10 to 29 — found that five per cent of buyers in the Metro Vancouver were foreign (neither Canadian citizens or permanent residents).

 

Nearly all of those buyers were Chinese nationals.

At the time, de Jong said although the study was in its early stages, it is the most accurate data the government has on the issue of foreign ownership.

I would like to see the data on the 90% of Canadian buyers. What percentage were bought by PRs, what percentage was bought by a "Canadian" company, what percentage was bought by a new Canadian with almost zero income? That 10-90 ration would surely shift.

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On July 27, 2016 at 0:28 PM, Warhippy said:

If anyone ever asks why real estate agents are considered the new used car salesman type 

 

Look no further than this story.

 

http://glbn.ca/AyegAc

The guy they are referring to makes used car salesmen look like Priests. He's a bad example of a realtor. Like any industry there are always a few bad apples. 95% of the realtors I know are good hard working people. The other 5% including the guy mentioned in the article are worse than used car salesmen. They would sell their own mothers if the price was right. 

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6 hours ago, cabinessence said:

I would like to see the data on the 90% of Canadian buyers. What percentage were bought by PRs, what percentage was bought by a "Canadian" company, what percentage was bought by a new Canadian with almost zero income? That 10-90 ration would surely shift.

That's a good point. There are a lot of "Chinese" buyers that have a PR card whereby the money is still being funnelled in from China. Also foreigners are using friends or relatives that are already here and have PR cards and using them to buy property by putting the properties in their names. 

 

At the end of the day the only way to get true and accurate data is to follow the money and to get CRA to crackdown on cheats. Instead of allowing Canadian citizens and permanent residents to be exempt from the 15% tax they should only allow people who file tax returns in BC who report their world wide income to be exempt. That way you would be able to crack down on the cheats and on people who don't even file a tax return even though a majority of their income comes from outside the Country.  There are lots of foreigners who have a PR card whereby most of their income and assets lie outside Canada. 

 

If you can't follow the money for any individual by tracking their tax returns and seeing where their money is coming from and what assets they own outside Canada then these people shouldn't be exempt from the 15% tax. 

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On 7/25/2016 at 10:48 PM, Harvey Spector said:

I'm meeting up with my Realtor friend tomorrow as we're working on a deal together. She Chinese and works the Westside and Richmond. She works with offshore clients. I'm gonna get the scoop from her on what's going on over on the Westside. Tomorrow should be an interesting day. 

What did you find out?

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4 minutes ago, Realtor Rod said:

What about Rick?

Ya gotta get to know this guy, he's the real deal, he's got a huge database with buyers ready to give you TOP DOLLAR for your home. If your home isn't sold by the time you greed to he'll pay your mortgage, I mean, who does this? Give him a call.

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2 hours ago, cabinessence said:

Ya gotta get to know this guy, he's the real deal, he's got a huge database with buyers ready to give you TOP DOLLAR for your home. If your home isn't sold by the time you greed to he'll pay your mortgage, I mean, who does this? Give him a call.

Nah, I'm good, and my clients are better...

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3 hours ago, cabinessence said:

Ya gotta get to know this guy, he's the real deal, he's got a huge database with buyers ready to give you TOP DOLLAR for your home. If your home isn't sold by the time you greed to he'll pay your mortgage, I mean, who does this? Give him a call.

Gimmicks like that make me wonder why so many people even use Realtors in Vancouver. With supply low and demand ridiculously high, it shouldn't take much to move an appropriately priced house. 

 

Doing it privately with a lawyer seems significantly cheaper.

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15 minutes ago, KFBR392 said:

Gimmicks like that make me wonder why so many people even use Realtors in Vancouver. With supply low and demand ridiculously high, it shouldn't take much to move an appropriately priced house. 

 

Doing it privately with a lawyer seems significantly cheaper.

Shhhhh dammit man!

 

The moment people realize they can hire a lawyer, notary find their own home inspector, and conveyancer as well as market their home for less than $1400 on their cell phones; realtors are gonna be furious

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This tax is a joke.

 

First, anyone who is able to afford $2 million for a house can CERTAINLY afford $300,000 on top of it.  And the way the market is going anyways, it won't take very long for a buyer to turn a profit.

 

Second, the tax completely ignores the super-rich that are already here, and buy up 7 or 8 or 15 properties.

 

And as already mentioned, let a local buy it as a proxy.  This tax is nothing but lip service.

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My wife and I have no kids and both earn good money. In Toronto there are way more jobs and far higher pay and we can AT LEAST afford a starter home, IE a crappy house in a crappy neighbourhood but at least it is something. Toronto is pretty ridiculous as well though, with often a dozen offers at 10-20% over asking price. There is also less than 10% the number of houses available on the market today as there were 10 years ago. 

 

Another huge benefit of Toronto is a large percentage of the housing units are rowhouses (non-strata townhouses) and semi-detached homes (duplexes). While still pricey, they are a lot less expensive than a detached home in the same area, are big enough to have a family in, and within reach for 15-20% of the 30 year old, double income earning population.  

 The dream in Vancouver is dead. In my career I should be able to get up to around $200K per year (at least in Toronto - good luck in Vancouver) but even with that level of income I can't afford a crappy starter house anywhere in the lower mainland, never mind Vancouver. 

""To make sure that we preserve the dream of owning a home and keeping it in the reach of the middle class," said Clark in the video."

Such bullcrap! The average house in Vancouver is now deemed unaffordable for a family earning in the 99th percentile, IE an average house is unaffordable for some members of the top 1% in Vancouver. 

 

Condos are not the answer - unless they start building them with three bedrooms and targeting these 3-bedroom units to family, not luxury buyers. The focus should be on rowhouses and stacked rowhouses. 
 

 

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13 hours ago, Warhippy said:

Shhhhh dammit man!

 

The moment people realize they can hire a lawyer, notary find their own home inspector, and conveyancer as well as market their home for less than $1400 on their cell phones; realtors are gonna be furious

I have a mile long list of people who tried themselves and came to me afterwards. It works for some, but many prefer professionals to handle the sale of their most valuable asset. 

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4 hours ago, canucklehead44 said:

My wife and I have no kids and both earn good money. In Toronto there are way more jobs and far higher pay and we can AT LEAST afford a starter home, IE a crappy house in a crappy neighbourhood but at least it is something. Toronto is pretty ridiculous as well though, with often a dozen offers at 10-20% over asking price. There is also less than 10% the number of houses available on the market today as there were 10 years ago. 

 

Another huge benefit of Toronto is a large percentage of the housing units are rowhouses (non-strata townhouses) and semi-detached homes (duplexes). While still pricey, they are a lot less expensive than a detached home in the same area, are big enough to have a family in, and within reach for 15-20% of the 30 year old, double income earning population.  

 The dream in Vancouver is dead. In my career I should be able to get up to around $200K per year (at least in Toronto - good luck in Vancouver) but even with that level of income I can't afford a crappy starter house anywhere in the lower mainland, never mind Vancouver. 

""To make sure that we preserve the dream of owning a home and keeping it in the reach of the middle class," said Clark in the video."

Such bullcrap! The average house in Vancouver is now deemed unaffordable for a family earning in the 99th percentile, IE an average house is unaffordable for some members of the top 1% in Vancouver. 

 

Condos are not the answer - unless they start building them with three bedrooms and targeting these 3-bedroom units to family, not luxury buyers. The focus should be on rowhouses and stacked rowhouses. 
 

 

Affordability 40 minutes east of Vancouver used to be substantially better. The gap has closed. There have been a lot people move to Abbotsford from Vancouver since I  started real estate nearly 20 years ago. 

 

We have more land out here and developers are more creative with things like row homes etc. However, everyone pushes the envelope on price. The neighbourhood sold for X so I want to bump my price by Y and if they get it the bar is set. 

 

There will (and has been) a cooling off but it always takes time for things to settle. 

 

If you make 100k a year you get into a starter home in the Eastern Valley.

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4 hours ago, Realtor Rod said:

Affordability 40 minutes east of Vancouver used to be substantially better. The gap has closed. There have been a lot people move to Abbotsford from Vancouver since I  started real estate nearly 20 years ago. 

 

We have more land out here and developers are more creative with things like row homes etc. However, everyone pushes the envelope on price. The neighbourhood sold for X so I want to bump my price by Y and if they get it the bar is set. 

 

There will (and has been) a cooling off but it always takes time for things to settle. 

 

If you make 100k a year you get into a starter home in the Eastern Valley.

Very true. I guess one other challenge, in addition to the lack of family housing, is there is almost no light transit. The Toronto Subway, while it serves a far more dense region, based on size is comparable to the Vancouver skytrain. The West Coast express is pretty limited in the area it serves. Toronto has a light rail system that covers a massive region (including places like Barrie & Hamilton). Hamilton is way up in price, but you can still find solid homes for under 400K http://www.kijiji.ca/v-house-for-sale/hamilton/in-law-suite/1185879973

Not to say the GO system is any sort of silver bullet - people complain about it endlessly. That said, I would still love to see some sort of light rail line similar to the BART in San Francisco bolt down the middle of highway 1 down to Chilliwack, stopping in Abbotsford, Aldergrove, Walnut Grove, and Surrey (perhaps connecting with the Skytrain?). 

The 15% foreign investor tax is "too little too late" as things got completely out of reach ramping up to the Olympics, and even a 40% price drop would barely help the problem. 

I guess moving forward:

1. Curb outside demand, push to keep housing prices better aligned with local earning power & inflation
2. Build a light rail system to the valley so it can better serve families working in the city but can't afford to live in the lower mainland
3. Re-zone single family dwellings to allow for row-houses (or stacked row-houses) that are simple and just large enough for a family of four (3 bedrooms, 1000 sq ft). 


Politically, terms like "low income housing" and "middle class families" sounds good. But the focus, as ugly as it sounds, also needs to be on supplying affordable housing for the "upper middle class" income earners. Engineers, skilled trades, software developers, and family doctors. In 2011 I worked with family doctors at a private facility (IE I think they were paid higher than public, but not certain) complaining about being priced out of Vancouver. It was impossible to attract talent - why leave a mansion and private schools in Edmonton for a East Van tear down with a basement suite rental? Vancouver is going to get a lot of talent drain if people in the highest paid professions can't afford housing. 

Below is a map of the GTA's light rail system, to give you an idea of how extensive it is and how the Lower Mainland/Fraser Valley should be able to do something. 
 


system_map-900x695.jpg

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5 hours ago, Realtor Rod said:

Lol.  Charter rights? People who do not have Canadian residence by definition live under a different set of laws. They have no rights to property here anymore than they have rights to free health care, welfare payments, to work, etc....

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5 hours ago, Realtor Rod said:

Affordability 40 minutes east of Vancouver used to be substantially better. The gap has closed. There have been a lot people move to Abbotsford from Vancouver since I  started real estate nearly 20 years ago. 

 

We have more land out here and developers are more creative with things like row homes etc. However, everyone pushes the envelope on price. The neighbourhood sold for X so I want to bump my price by Y and if they get it the bar is set. 

 

There will (and has been) a cooling off but it always takes time for things to settle. 

 

If you make 100k a year you get into a starter home in the Eastern Valley.

What do the Libs think this tax will do to these buyers in regards to that gap?

 

There won't be one.  There will be $350k .25 acre lots going up in frigging Hop and the Sunshine valley :lol:

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10 hours ago, canucklehead44 said:

My wife and I have no kids and both earn good money. In Toronto there are way more jobs and far higher pay and we can AT LEAST afford a starter home, IE a crappy house in a crappy neighbourhood but at least it is something. Toronto is pretty ridiculous as well though, with often a dozen offers at 10-20% over asking price. There is also less than 10% the number of houses available on the market today as there were 10 years ago. 

 

Another huge benefit of Toronto is a large percentage of the housing units are rowhouses (non-strata townhouses) and semi-detached homes (duplexes). While still pricey, they are a lot less expensive than a detached home in the same area, are big enough to have a family in, and within reach for 15-20% of the 30 year old, double income earning population.  

 The dream in Vancouver is dead. In my career I should be able to get up to around $200K per year (at least in Toronto - good luck in Vancouver) but even with that level of income I can't afford a crappy starter house anywhere in the lower mainland, never mind Vancouver. 

""To make sure that we preserve the dream of owning a home and keeping it in the reach of the middle class," said Clark in the video."

Such bullcrap! The average house in Vancouver is now deemed unaffordable for a family earning in the 99th percentile, IE an average house is unaffordable for some members of the top 1% in Vancouver. 

 

Condos are not the answer - unless they start building them with three bedrooms and targeting these 3-bedroom units to family, not luxury buyers. The focus should be on rowhouses and stacked rowhouses. 
 

 

The fundamental difference between Vancouver and Toronto though is that Toronto has an economy based outside of home sales and the ports.

 

Toronto has major corporate headquarters, ports, stock exchange embassys and more without factoring in the transit system which lets be honest; kicks the crap out of Vancouvers.

 

Strip away home sales and the ports and Vancouver is nothing more than a service based tourist city.  That in fact happens to be the failing point for every argument about comparisons between vancouver San Fran New York Hong Kong Sydney London and more

 

These are cities with economies and people with incomes that by and large can afford these prices.

 

When the median family income in vancouver is between $64,000 and $70,000 for a family of 4 and the numbers for a 3 person family in San Fran show $83k (where the cost of living is actually far cheaper once housing is stripped away) it's a stark contrast.

 

I shake my head wondering how prices got so high so fast, then I remember that we kind of let this happen

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