Is Your City Being Sold Off to Global Elites?
Visas for sale, skyrocketing housing prices, miles of condos
It’s midmorning on a Saturday in Richmond, a suburb of Vancouver, British Columbia, and this is maybe the 20th example we’ve seen of what locals call the “empty-house syndrome"—homes purchased by foreign nationals, many of them wealthy Chinese, and left to sit vacant. Some will eventually have occupants; Vancouver is a top destination for well-heeled emigrants. But often, the new owners treat the houses as little more than vehicles for spiriting capital out of China. By one recent estimate, 67,000 homes, condos, and apartments in the Vancouver metro area, or about 6.5 percent of the total, are either empty or “underused”—an appalling statistic, given a housing market so tight that rental vacancy rates are below 1 percent. Hence the shoes: To shield absentee owners from public opprobrium, niche firms specializing in “vacant-property maintenance” will arrange elaborate camouflages—everything from timed light switches and “garden staging” to artful props, like pumpkins at Halloween and wreaths at Christmas.
(..) For wealthy Chinese, Vancouver has emerged as the perfect “hedge city”—scenic, cosmopolitan, with good schools, a long-standing Chinese community, and an undervalued (by global standards) real estate market where capital can be sheltered against mounting economic and political uncertainties back home. In 2015 alone, according to estimates by Canada’s National Bank Financial, Chinese purchases of real estate in the Vancouver metropolitan area amounted to nearly $ 10 billion, or a third of the total dollar amount spent on city real estate. (Figures are in US dollars unless otherwise noted.) So popular is Vancouver among hedgers that local real estate firms send Mandarin-speaking recruiters to Chinese cities to entice buyers to take bus tours of Vancouver’s upscale neighborhoods.
But for many longtime residents, Vancouver’s evolving role as a giant safety deposit box for China’s elite has been profoundly destabilizing. Thanks in part to foreign capital, home prices here have more than doubled since 2006. In one 12-month period (mid-2015 to mid-2016), the median price for a single-family house jumped nearly 40 percent, to $ 1.17 million, making Vancouver almost as expensive as San Francisco, but with a job market that is far less varied and robust. (Continua)