Revisiting real estate, race, and how the foreign-buyers narrative came to dominate Vancouver media

The divide between evidence and belief raises the question: how did the region become so convinced that foreign money is the dominating force driving the Vancouver real-estate market?

    1 of 3 2 of 3

      One afternoon last month, Eric Lam was taking part in what’s become something of a collective pastime for Vancouver residents: he was chatting on social media, complaining about the city’s runaway real-estate market.

      A message caught his attention.

      “Can suggest talking to any Chinese Dad who hangs out at elementary school pickup,” wrote a Twitter user. “None of them have jobs here. Wife is homeowner, no income. No income taxes. Welfare!!”

      Lam replied by noting that he is a Chinese dad who picks his kids up whenever they happen to need a ride.

      The user attempted to clarify: “I mean Chinese Nationality, clearly new to Canada,” they wrote. “Not Chinese from Hong Kong that moved here 20 years ago.”

      The exchange didn’t include an ethnic slur but exemplifies the sort of casual racism that’s infiltrated conversations about Vancouver real estate.

      Lam was born in Hong Kong and moved to Vancouver when he was three years old. Today, he’s a UBC grad and financial-portfolio manager who lives in Kitsilano with his wife and four children. In a telephone interview, he was quick to share his own frustrations about real-estate prices in Metro Vancouver that have increased by 70 percent over the past three years.

      “I understand his anger,” Lam said about the exchange on Twitter. “I see an increasing numbers of friends and acquaintances either struggling with housing or leaving Vancouver or both.”

      Lam emphasized he is convinced foreign money is behind the region’s affordability crisis. “I actually think it may have received too little [attention],” he added.

      At the same time, Lam said, he is concerned about how those conversations are taking place.

      “There’s a sense that there are all these rich Chinese people who have come into the market and now are driving their Mercedes and living off of welfare,” he explained. “I think that is starting to verge on xenophobia....I have friends that are newly immigrated from China and they came here with nothing, barely speaking English, and lived the traditional immigrant’s story: came here for the kids, worked really hard. Putting people in the same box, there is a real danger in that.”

      Lam laid part of the blame on newspaper and television coverage, arguing that too often reports fail to distinguish between money from Mainland China and long-time residents of Vancouver who happen to have Asian backgrounds.

      “It runs the risk of an irrational backlash against general immigration in totality,” he said.

      That view was shared by Jackie Wong, an adjunct instructor with UBC’s creative-writing program. She told the Straight that public discourse has been “harmed” by overly broad headlines that generalize and conflate the issues.

      “If the best role of media is to inform and educate people and help cultivate a more critical awareness or a critical perspective on public-interest issues, I think the current coverage—both in Vancouver and internationally—has really inflamed a lot of casual racism,” Wong said.

      (This article is part two in a series. Read part one: History shows racism has always been a part of Vancouver real estate.)

      Cognitive dissonance and feedback loops

      Today, the belief that money from Mainland China is flooding Vancouver’s real-estate market is so entrenched that calls have grown for a moratorium or even an outright ban on property sales to foreign nationals.

      Yet there’s remarkably scant information that definitively proves that is the case and just as much data out there that suggests the opposite is true. (That claim is not the point of this article but is discussed in more detail below.) The divide between evidence and belief raises the question: how did the region become so convinced that foreign money is the dominating force driving the Vancouver real-estate market?

      Alfred Hermida is director of UBC’s graduate school of journalism and the author of Tell Everyone: Why We Share and Why It Matters, which explores social media’s impact on information, conversation, and influence.

      In a telephone interview, he suggested that the intersection of traditional news media and social-media services like Twitter and Facebook has played a powerful role in shaping Vancouver conversations about real estate and in amplifying the perceived role of foreign money.

      “There is no doubt it is one of the issues,” Hermida began. “Of course, it is not the only one. But when journalists are looking to tell a story, they often focus on one issue rather than complex issues.”

      From there, he continued, three phenomena, each of which has grown stronger since the advent of social media, converge to reinforce and amplify a simplified narrative.

      In his book about social media, former BBC News journalist Alfred Hermida explains how digital communications can amplify a message to distort the larger story.

      The first is an “othering”.

      “We always want to blame the other,” Hermida explained with a reference to the work of the late Palestinian-American scholar Edward Said.

      “We want to blame somebody else,” he continued. “It’s much easier to demonize a foreign owner than it is to say, ‘I live in a neighbourhood that has family homes…and I don’t want development in my neighbourhood.’”

      The second phenomenon Hermida talked about was confirmation bias and a predisposition to reduce cognitive dissonance; that is, a reader’s tendency to share stories that they agree with or that confirm their existing beliefs while ignoring articles that challenge their established opinions on a subject.

      “As humans, we are always looking for stories that support and reinforce our point of view,” Hermida said. “We resist messages that run counter to what we believe.”

      Finally, Hermida continued, traditional news outlets pair with social media to create a feedback loop.

      “If the media keeps on talking about foreign ownership as an issue, that then gets repeated and amplified through social media, which then means that [traditional] media reports on it again because they see lots of people are interested in this issue,” Hermida said.

      Imagine two articles published on the same day. The first, about foreign buyers, is shared widely on social media, while the second, about zoning regulations, is largely ignored. Journalists for a variety of news outlets observe the extent to which the first article caught the public’s attention, and then rush to replicate the story for their respective outlets. Those articles are then published, received by readers, and perceived as confirming opinions those readers developed based on the initial article. Pleased to see more information supporting their views, the readers then share URLs for the second wave of articles, and so on.

      Zoning regulations covered in the second article might have had just as great an impact on real-estate prices, but they only received a fraction of the public’s attention.

      “You get a feedback loop and suddenly the story becomes one of foreign ownership in Vancouver as opposed to a more nuanced approach that says maybe foreign ownership might be to do with certain types of certain areas and less so in others,” Hermida said. “It is partly being amplified and reinforced.”

      Uneven coverage

      In a telephone interview, the B.C. Real Estate Association’s chief economist, Cameron Muir, noted that where there is evidence of significant sums of foreign money in Vancouver real estate is in the high-end market. But Muir noted those houses only constitute a small fraction of the total.

      “It is kind of puzzling that we see 98 percent of the media concentrating on the top two percent of homes,” he told the Straight. “As if the West Side of Vancouver and a single detached home is the benchmark for affordability. It’s not. But it certainly makes great stories and great headlines.”

      Muir called attention to how he has perceived media outlets to attribute greater significance to information that supports the foreign-buyers narrative while downplaying information that suggests other forces are having an equal or greater impact on the market. He offered two examples to illustrate his point.

      On March 23, Bloomberg News ran a story that claimed “Buyers from China comprised about one-third of purchases of Vancouver’s hot housing market in 2015.”

      That article described the estimate as a “back of the envelope calculation” based on a survey of just 77 “high-end buyers”.

      Muir noted the small sample size and laughed at the idea people who live in China are buying up an entire one-third of all property sold in Vancouver. But the statistic was picked up by local media outlets and continues to figure prominently in articles today. “China syndrome paralyzing B.C.’s politicians” reads the headline of a June 20 column in 24 Hours that used that figure as the premise for an argument to halt sales to foreign nationals.

      Muir compared how the media treated that 30-percent figure with its treatment of more solid research that happens to suggest foreign buyers might be playing a smaller role in the market than many people assume. The City of Vancouver’s data on empty homes purports to show that while there are many anecdotes about houses left vacant in Point Grey, the data says single-family and duplex homes in Vancouver have a vacancy rate of just one percent.

      Muir asked why there were so many attempts to discredit that study while the Bloomberg story caught on and continues to be repeated.

      “A lot of people didn’t even question it [the Bloomberg estimate] and then they started to really question and dig into the validity of a very good study done by the City of Vancouver,” Muir said. “I started to question where their analytic skills lie, relative to their skills as an activist.”

      B.C. finance minister Mike de Jong recently revealed that 5.1 percent of Metro Vancouver real-estate transactions during a three-week period in June went to foreign nationals.

      Other comparisons reveal more dramatic disparities in coverage. A May 2016 paper by SFU professor Josh Gordon didn't include any new information about foreign money in Vancouver real estate but did a good job summarizing much of what is known about the issue. It concluded: “The dominant explanation for the crisis in Vancouver is a large and continuous flow of foreign money into the region". It received an avalanche of coverage from Vancouver media. Meanwhile, an August 2015 paper by the University of Alberta's Kerry Sun similarly laid out existing research on foreign money in Vancouver real estate. It then arrived at a different conclusion, that "existing studies appear to show relatively low levels of foreign investment." There was only one mention of Sun's paper in Vancouver media outlets.

      Confusing foreign money and Chinese buyers

      On the phone from Toronto, Victor Wong, executive director of the Chinese Canadian National Council, argued that simple repetition has played a big role in reinforcing the dominance of the foreign-buyers narrative.

      Wong, a long-time resident of Vancouver, noted that there have been very few instances of solid information released on foreign ownership. Yet barely a week has passed when the topic didn’t land on the front page of one of the region’s major newspapers.

      “It’s an echo chamber of articles repeating itself to a point it is taken as fact,” he said.

      Wong argued that when you combine the power of repetition with a misrepresentation of details, the result is a confused public.

      As an example, he pointed to coverage of a study by Bing Thom Architects’ Andy Yan that was published online in November 2015.

      Here’s how the headline read in the National Post: “In a six-month period, 70% of detached homes sold in Vancouver’s west side went to Mainland China buyers”

      The statistic is correct. But Yan’s study did not look at Vancouver’s West Side. It looked at the University Endowment Lands, Dunbar, and Point Grey—three neighbourhoods that constitute a small part of Vancouver’s far West Side. Yan’s study also did not identify buyers that reside in Mainland China. It identified buyers with “non-anglicized Chinese names” as an indicator of the possibility a buyer was a new immigrant.

      Other newspapers used headlines that were more accurate in that they did not claim that the study revealed property owners’ locations. “Vancouver housing market fuelled by Chinese buyers” reads the headline above the study’s presentation at the Globe and Mail. It’s a statement that is true for the sales analyzed, but that, combined with the thrust of the article beneath it, confuses the issues of “foreign money” and “Chinese buyers” to the point where they become one and the same.

      “They conflate things,” Wong said. “When you use Chinese names as a proxy then you are basically profiling. You are combining people who are foreign non-residents who live in Beijing…with newcomers who actually live here, who have every right to buy wherever they want to buy.”

      A skim through headlines further proves his point in a more general sense. “Chinese buyers making mark on Vancouver’s luxury housing” reads an August 2015 headline in the Globe and Mail. “Real estate developers shrug as flood of Chinese cash into Vancouver continues” states a headline published one month later by the Vancouver Sun. More recently, a May 8 headline in the Province reads “Chinese homebuyers crush dreams.” Are these articles about foreign money or Chinese Canadians?

      Blame squarely on the government

      At her office on West Broadway overlooking Vancouver, Fenella Sung told the Straight the city’s Chinese communities are feeling a backlash from the region’s frustrations over real estate. But Sung, a member of the group Friends of Hong Kong, said she doesn’t blame the public or media outlets.

      “I put the blame squarely on the government, which has not been doing anything,” she stated. “They’ve allowed this situation to go on.”

      Sung argued that Canadian authorities should have acted long ago to restrict the flow of wealth accumulated through corruption from entering Vancouver’s real-estate market. She said it is that failure of Canadian regulators that is ultimately responsible for the role that foreign money has come to play.

      “Those of us who came from Hong Kong or from China or from many parts of Asia, we came to Canada because we didn’t like what we saw over there,” Sung continued.

      “How would you feel?” Sung asked. “That is why we think we have to fight back. We have to tell our governments—Canadian governments, at all levels—to really do something about this.”

      This article is part two in a series. Read part one: History shows racism has always been a part of Vancouver real estate.