Should we tax foreign buyers of Vancouver real estate?
South China Morning Post story considers a levy on international buyers in Vancouver
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Vancouver’s sky-high real estate prices and the influence of offshore investors has come under fire again, in a controversial article on the South China Morning Post website.
The Post article, by Vancouver correspondent Ian Young, focuses on translator Joy Mo, who was born in China and now rents a house with her husband and two children in Coquitlam, B.C..
Mo, who has lived in the Vancouver area since 2002, blames her fellow countrymen and women for driving up local housing prices without contributing sufficiently to the local community.
“I’m not saying they shouldn’t buy,” said Mo in an interview with the CBC. “I mean, nobody can stop them from buying. I’m saying for international buyers, shouldn’t we set a different tax standard like a lot of other countries do?”
Vancouverites have long complained that wealthy real estate speculators from Hong Kong and mainland China have driven up housing prices. (Andy Clark /Reuters)
Mo is expecting her third child and has been trying to buy a house in the TriCities area. She and her husband have been outbid twice, once by a foreign buyer, also from China.
She thinks the way to go is an extra premium — a tax — for offshore buyers, similar to the 15 per cent tax on non-residents that Hong Kong has implemented.
“I’m not sure it would actually push the real estate prices down, but at least [offshore buyers] would contribute a little bit more to society,” says Mo.
Journalist Ian Young acknowledges that singling out one group to blame is contentious, but thinks his article serves an important purpose:
“The fact that a large number of these buyers are Chinese should not deter a discussion about whether or not it is a desirable situation.”
Vancouver Mayor Gregor Roberston says the market is nowhere near as hot as Hong Kong’s, but that his task force on housing affordability is checking out options.
“We don’t want to take any rash actions that might impact investment in the city,” said Robertson.
“We’re not Hong Kong. They saw real estate prices rise 26 per cent last year, which is unbelievable – they had to take rash actions to deal with that.
“We’re not at that stage. But there are warning signs that we have watch very carefully, and we may have to take action in the future if it’s warranted.”
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