Report finds Vancouver's foreign property ownership fears are overblown

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      Many are gripped by the notion that foreigners are taking over homes in Vancouver.

      “There is an obsession with it,” economist Ryan Berlin observed in a phone interview with the Georgia Straight.

      Amid such an atmosphere, Berlin and his fellow analysts with the Vancouver-based think tank Urban Futures decided to check it out. Together with David Baxter and Andrew Ramlo, he combed through numbers from the 2011 census. They were after two things: temporary or foreign residents and unoccupied dwellings.

      The title of their paper is actually a giveaway. In “Much Ado About Nothing: What the Census Data Say, and Don’t Say, About Foreign and Temporary Residents and Unoccupied Dwellings”, they conclude that the Lower Mainland isn’t any different than other metropolitan regions across the country.

      “There are significant housing issues in this region—the levels of occupancy by foreign and/or temporary residents and level of unoccupied units are not among them,” the authors state.

      Citing an example, Berlin noted to the Straight that when it comes to foreign and temporary residency in apartments, it’s 1.4 percent in Metro Vancouver. That’s not very different from the 1.3 percent average in 19 major metropolitan areas in the country.

      Berlin stressed that based on the definition provided in the 2011 census, the term “foreign or temporary resident” doesn’t necessarily mean that the person is not a Canadian. It only means that the individual considers another place, elsewhere in Canada or abroad, to be their primary residence. This group includes workers, students, tourists, and even visiting family friends.

      “We were just trying to reframe the debate in terms of the actual numbers and in terms of the definitions,” Berlin explained.

      With respect to the overall housing stock in Metro Vancouver, less than one percent—or 0.8 percent—is occupied by foreign and temporary residents. According to the paper, that’s about the same “insignificant” share as the other 18 metropolitan regions in Canada with populations of at least 200,000.

      The paper also cites the impact of postsecondary students. It notes that while the City of Vancouver and the District of West Vancouver have slightly above the regional average of 1.4 percent in connection with apartment occupancy, the UBC and University Endowment Lands area has 5.8 percent of its apartment stock occupied by foreign and temporary residents of Canada.

      The 2011 census established that an average of 4.8 percent of all dwelling units in 33 metropolitan areas across Canada were unoccupied at the time of the count. Metro Vancouver had a slightly higher rate of 5.4 percent. However, the authors note that this rate is lower than other regions like Victoria’s 7.5 percent; London and Windsor, at 6.9 percent; and St. Catharines/Niagara and Sherbrooke, both at 6.8 percent.

      The authors also point to a thing called census undercount. “This is the number of usual residents who should have been included in the Census but were, for some reason or another, not counted,” they explain. “According to current estimates, there were roughly 85,000 usual residents that were missed in the region, 3.7 percent above the Census count reported for 2011.”

      The authors also point out that there are no census data on foreign ownership or investment in housing.

      “The bottom-line is that the 2011 Census data clearly show that much ado is being made about nothing when it comes to the prevalence of foreign and/or temporary residents and unoccupied dwellings in this region,” the trio note in their paper.

      The findings of the paper likely aren’t going to stop persistent talk about how foreigners are taking homes away from ordinary residents in Metro Vancouver. That’s been going on this region for years.

      To this, Berlin responds: “What we need to do is to scale back the generalizations we’re making and actually just only go as far as the data allow us to go when making conclusions. And that is not very far.”

      Comments

      3 Comments

      Gigi

      May 9, 2013 at 12:20am

      Key statement: "The authors also point out that there are no census data on foreign ownership or investment in housing"

      So what does this article prove if it is based on census data??? It just proves that Canadian citizens are living in the apartments (ie. renting, etc). But who is buying them all???

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      Bryn

      May 15, 2013 at 11:44am

      One factor that needs to be considered is the tax implications of selling when the property is not considered your "primary residence". CRA counts capital gains from a secondary property as 100% income, meaning if you sell a place for $1.8m that you bought for $1.2m 5 years before, you will pay tax as if you earned $600,000 that year and you definitely will be in the maximum income tax bracket.

      In contrast if you declare the property to be your "primary residence" then you pay no capital gains at all, meaning you just earned $600,000 tax free in that scenario.

      Given the huge tax implications in the overheated Vancouver market I'd be surprised to find too many people that would admit that their property is not their primary residence regardless of their actual residency.

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      Mitch

      May 18, 2013 at 7:35pm

      It's all about the ownership, not tenancy! The whole premise of the article is useless.

      (just like most of the so-called music reviews...)

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