Vancouver housing draws Chinese
Updated: 2013-03-14 11:25
By Eddy Lok in Toronto (China Daily)
Visitors check information at a Vancouver property booth at a real estate show in Beijing. Chinese buyers have become an active force in the Canadian city's housing market where high prices have deterred many other buyers. For China Daily
Vancouver, home to one of the largest populations of Chinese immigrants, is hoping that buyers from China can help reverse a lull in the local real estate market even though prices remain sky-high.
In February, residential-property sales in the city and its immediate surroundings fell below their 10-year average, according to the Real Estate Board of Greater Vancouver. The trade group said 1,797 properties changed hands last month, a 29.4 percent decrease from February 2012.
The sales were the second-lowest February total in the Vancouver metropolitan area since 2001 and almost 31 percent below a 10-year average for the month.
Would-be buyers from China are among the few who have been viewing properties during the slowdown, local real estate agent Jacob Bosoff said.
New townhouses in the area are listed at 20 percent to 40 percent below 2010 prices, according to Boshoff, of Re/Max Results Realty.
"I have some great listings today that sellers bought in 2010 for C$520,000 ($506,000) and are now being offered for C$479,000 and still no offers," he said. "I see that my Chinese investors are buying, but they do a lot more looking into the market."
Boshoff said he had just shown a Chinese client town houses in the Vancouver suburb of Coquitlam, British Columbia, that were listed at between $380,000 and $500,000.
Chinese, like others in the metro area of about 2 million people, are attracted to Vancouver's scenic beauty, proximity to Asia, and high-quality health care and education. About 400,000 residents - one-fifth of the local populace - are of Chinese descent.
Affluent Chinese, meanwhile, have helped drive up real estate prices in Vancouver, with ripple effects in industries that support real estate.
Those from China who immigrate to Canada and settle in metro Vancouver have become a force in marketing, trade, education and culture, according to a 2011 research paper by Li Yu published in the Journal of the Canadian Historical Association.
The Chinese mainland has been the biggest source of foreign migration to the area during the past decade, and metro Vancouver receives more than 10,000 Chinese visitors a year, wrote Yu, an Asian-studies instructor in the city.
While Chinese with deep pockets are welcomed by real estate agents and home sellers for the high prices they're willing to pay, other buyers resent being priced out of the inflated market.
Peter Ladner, a former Vancouver city councillor, told China Daily that local housing prices are out of control. He has raised the idea of imposing restrictions on foreign ownership, saying too many people are being forced to move out of Vancouver or avoid relocating there.
"High house prices is one of the reasons businesses are undermined. The economy is undermined when housing prices get too high. People cannot afford to do business and workers cannot afford to live here," said Ladner, who is now a fellow at the Centre for Dialogue at Simon Fraser University.
He pointed to jurisdictions such as Hong Kong, Brunei and Australia that limit foreigners' purchases of real estate. Within Canada, the provinces of Alberta, Manitoba, Prince Edward Island and Saskatchewan already have laws restricting the land-purchase rights of people who aren't already residents.
Dan Scarrow, vice-president of corporate strategy for Macdonald Realty in Vancouver, said the area's luxury-home market is "insanely hot", with mainland Chinese the primary buyers.
According to Robin Wiebe, a senior economist at the Conference Board of Canada's Centre for Municipal Studies, the impact of China's economic growth on the Vancouver property market matches that of three local factors: population growth, changes in employment and mortgage interest rates.