Earlier this month, Straight.com reposted an article by Vancouver journalist Ng Weng Hoong questioning the media narrative about the local real estate market.
In that article, Ng paid particular attention to an October 2015 study by academic Andy Yan, who focused on non-anglicized Chinese names of homebuyers on the West Side.
The study was based on data provided by David Eby, the current attorney general, as well as the NDP critic for housing back in 2015.
"The media immediately pounced on the study as confirming a widely held suspicion that the Chinese were buying out of the city’s housing supply," Ng wrote. "Having contributed significantly to Chinese-scapegoating in the Vancouver housing discourse, the Eby-Yan study remains influential to this day.
"If the media and other analysts had been less trigger-happy, they would have noted the absurdity of a finding based on the microscopic sample size of 172 houses," Ng continued. "In 2015, that constituted about 0.4 percent of the more than 42,000 homes sold in Metro Vancouver."
Anyone who criticized the Eby-Yan study's methodology was hounded on social media by a raft of anonymous Twitter accounts. A local fraternity of journalists also jumped in, some of whom built their reputations arguing that foreign buying was the main factor propelling rising real estate prices.
Ng dismissed the widely held perception that foreign buying was the overwhelming factor driving up housing prices. For several years, he has maintained that this was deeply flawed because it overlooked a multitude of other factors, including a sharply increased money supply and low interest rates.
People who hold this view are feeling vindicated nowadadays as the Metro Vancouver housing market remains hotter than ever, even amid a sharp decline in immigration and a slowing economy due to the pandemic.
But an odd thing happened on April 26. Eby himself, in testimony to the Commission of Inquiry into Money Laundering in British Columbia, stated that he very much regretted his role in the 2015 study.
This revelation came while Eby was being questioned by B.C. Civil Liberties Association staff lawyer Jessica Magonet.
She asked if him if "making such broad statements about Chinese investment may help perpetuate a harmful narrative that conflates Chinese money with dirty money in British Columbia".
Eby replied: "I have apologized for my participation in the study for exactly that reason."
You can read the full transcript below:
Jessica Magonet: Minister Eby, can you hear me?
David Eby: Yes, I can.
JM: Excellent. So my questions mostly relate to an article that I would like to ask, Madam Registrar, if you could please pull up. It's entitled "Vancouver Real Estate a Buyers' Market - For Mainland China: Study." It's authored by Sam Cooper. I'll give you an opportunity to find that as well, Minister Eby. Just let me know when you're there.
Eby: Yes. Yes. Thank you.
JM: Excellent. Minister Eby, are you familiar with this article that discusses a study by Andy Yan and your perspective on it?
Eby: Yes, I am familiar with it.
JM: Mr. Commissioner, I would ask if this could please be marked the next exhibit.
The commissioner: Very well. I think we're at ...
The registrar: Yes, exhibit 915. Vancouver Real Estate a Buyers' 24 Market – For Mainland China: Study by Sam Cooper - November 2, 2015
JM: Minister Eby, it's my understanding that the study referred to in this article by Mr. Yan that he initiated this study at your request. Is that accurate?
Eby: I can't recall where his study originated from, but I recall that I provided him with land titles for a number of recent property transactions in the west side of the city of Vancouver so he could do the study. At the time I talked with Mr. Yan quite frequently about the issue of international money in the real estate market and the challenge that it presented. And so I also worked with other researchers doing similar work.
JM: Thank you. And in this particular study Mr. Yan concluded that 66 percent of all detached homes purchased in Vancouver's west side in a six-month period were bought by mainland China buyers; is that correct?
Eby: Yes, that was his conclusion.
JM: But in his study he assumed that a buyer was from mainland China if they had a non-anglicized Chinese name; is that accurate?
Eby: I don't know if that was his assumption, but that was one of the sociological markers that he used in his evaluation. I don't know if he used others.
JM: He certainly didn't have information on the residency or the citizenship of the buyers he was looking at?
Eby: You'd need to ask Mr. Yan that, but I didn't have any of that information to provide to him, nor could I.
JM: Okay. Thank you. You would agree that a Canadian citizen or a permanent resident of Chinese descent may have a non-anglicized Chinese name, wouldn't you?
Eby: Well, maybe I can save you some time. There's a better article where I apologize for my participation in this study. I was supportive of trying to get to the bottom of international money in our real estate market. I was insufficiently sensitive to the impact on the Chinese community of the sociological marker that Mr. Yan used based on other research in terms of the sense that a person's name is a really important personal marker, and to be described as a foreign investor based solely on what your name is was incredibly problematic for that community and completely understandably so I apologized for my participation in this by providing Mr. Yan with those studies.
JM: So if I understand your evidence correctly, you regret your participation in this study. Is that accurate?
Eby: Very much so.
JM: Thank you. That's helpful. I appreciate that your views may have -- well, have now changed, but at the time of this interview if I can just take you here to the first page, and it's displayed on the livestream. It says: "David Eby, the NDP MLA for Vancouver-Point Grey, told The Province he helped city planner and researcher Andy Yan undertake the B.C. land-title study because many of his Vancouver west side constituents have complained about hollowed-out neighbourhoods, absentee investors, property flipping, and suspicions of money laundering and unfair tax avoidance. Eby said the study fills a data gap in Vancouver and 'bears out the anecdotal feelings that people have about Mainland China buyers.'" And I was wondering if you could explain what you meant at the time by "anecdotal feelings about mainland China buyers."
Eby: The concern was broadly that international money on which taxes had not been paid at domestic rates and the sources of which were unknown and ambiguous were coming into the real estate market in a significant volume, driving up prices for local buyers that were unable to compete. And that was the concern that had been expressed to me on a number of occasions and that I hoped this study -- erroneously in my opinion, reflecting on my own activity in relation to this study -- but that I hoped this study would assist us with. I am very happy that our government has put in place a speculation tax that instead is based on whether someone is a tax resident in British Columbia as opposed to any particular citizenship status.
JM: Thank you. And, Madam Registrar, if I could now ask you to go to the next page of this article. You can go there as well, Minister Eby. There's a quote from you here, Minister Eby, that -- where you're reflecting on Mr. Yan's study and you say: "The questions that come up for me are: China is an authoritarian state that has lots of issues with corruption. Is the money coming into Vancouver the kind we want to be encouraging? And are we doing everything we can to make sure we leverage this investment to the benefit of British Columbians as much as possible? Or is this just benefiting the super-car dealerships on Burrard Street?" Do you agree that that's what you stated in this interview?
Eby: Yes, very likely.
JM: And from your first question, I take it that you're implying that money coming out of China is associated with corruption. Is that a fair characterization?
Eby: No. The concern was that there was a very profound risk that the money coming from international sources, including China, was money that was sourced from activities that might not be endorsed by the government of Canada, the government of British Columbia. And so without knowing -- and there are several very well documented examples of the Chinese government being concerned about people embezzling money in China, moving that money to British Columbia in the real estate market and then not being able to repatriate those individuals because of Canadian extradition policy requirements and that money ending up in the real estate market in British Columbia. And so that was the concern because there was no accountability in terms of criminal activities in China once someone made it to British Columbia. That the money coming into the market here may be problematic. It was based on a number of different concerns, not this study in particular.
JM: Okay. Thank you. And in your last question in this quote you say: "Or is this just benefitting the super-car dealerships on Burrard Street." I was wondering what the association here is that you're drawing between Chinese investment and these super car dealerships and what that was based on.
Eby: So the average family salary in Metro Vancouver is somewhere in the neighbourhood of $60,000, and yet for some reason Vancouver has five or six super car dealerships along Burrard Street. And the concern that many people in my constituency have and had was that the money coming into those dealerships was money of problematic origin. And since then we had the extensive work done in the Peter German report, volume 2, about the source of money involved in some luxury car transactions and some explanation about why we may be seeing so many of these luxury dealerships in relation to the export of luxury vehicles and also in relation to the purchase of luxury vehicles for cash that have borne out some of these concerns. To the extent that the quote appears to draw a direct correlation between in particular money from China and the super car dealerships, that's not the point I was trying to convey.The point I was trying to convey is by turning a blind eye to the source of money coming into British Columbia, who does that benefit? Does it benefit the super car dealerships? And if so, how does that benefit British Columbians and how does that hurt British Columbians in terms of the impact of that? So I hope that assists you in understanding what I was trying to convey in that quote.
JM: Yes. Thank you. I have just one last question for you, Minister Eby. In hindsight, do you think that making such broad statements about Chinese investment may help perpetuate a harmful narrative that conflates Chinese money with dirty money in British Columbia?
Eby: I have apologized for my participation in the study for exactly that reason.
JM: Thank you. Those are my questions.