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[anaron]

You should check out Vancouver

haha, perfect first reply.

 

[CarpeDeezNutz]

It's weird to me they just used a statue, you can roll around parts of DFW and feel like you drove into another country. Like Asia Times Square and Hong Kong market in Grand Prairie.

 

[jerry1594]

These people should fuck off. Go build banana stands in Mongolia instead.

 

[AlphaTwo00]

When their economy collapses, the houses will be available at tiny prices. just wait for the bust, everyone.

People in Vancouver and Toronto have been waiting for years. I'll be dead before it happens. It may slow down, but pretending that it will drop now is highly unlikely.

 

[Maximus.]

What did Vancouver do wrong?


Yep, I wonder how people will react as more precious real estate is bought up.

As I am sure you have already, the post I quoted below states the general issue.

Allowed a massive influx of foreign chinese real estate ownership, thereby raising the housing prices in Vancouver beyond what citizens of the city can actually afford. Houses in West Vancouver are going for multiple millions of dollars and are in some cases 4 or 5 million dollar teardowns. It was widely denied by the city and mayor until a recent study showed that chinese foreign ownership in multimillion dollar properties is actually causing the problem.

Unless you're a Vancouver home owner wanting to move out of the city or retire. I know someone who sold their house for 20% more than its worth to someone from Mainland China. They weren't ever going to get that kind of money from anyone actually residing here and they know it.

Petty much most of the Vancouver real estate market is being controlled by Mainland Chinese funds. On the one hand, it's a huge boon getting foreign money into the province, on the other hand, it's basically priced out the entire lower Mainland for anyone who lives here. Even two full time working married people will struggle to buy more than a townhouse these days. Small ass lots, tiny condos everywhere. I read something like 70% of all sales are happening from mainland Chinese buyers who see it as a good investment, buying up entire condo floors, entire townhouse strip units at a time.

Yes, people selling their home or properties are making bank. Those looking to buy a first home or upgrade their living arrangements are struggling and the city and province are reacting at a snails pace. Things will only get worse before better. What you've stated is correct too, a couple making good money cannot afford a reasonable home in one of the main cities.

 

[S-Wind]

Nah, there's no real racism. Most know that it's precisely mainland Chinese investors and rich individuals driving up the market. The average 'Asian' in BC who grows up middle class won't be able to afford them either. I think though, that mainland Chinese will have it tougher than Hong Kongers/Taiwanese. You have people in Surrey, Burnaby, Richmond, Langley bemoan the same issues that happened in Vancouver, happening there.

Though, why would any prospective house seller turn down any buyers? If anything, these investors and whatnot pay a premium.

Plenty of the people pissed off at the mainland Chinese investors are Canadians of Asian descent, like myself.

We should really pinpoint our ire at our politicians, as they are the ones who continue to allow this to happen.

 

[Madness]

People in Vancouver and Toronto have been waiting for years. I'll be dead before it happens. It may slow down, but pretending that it will drop now is highly unlikely.

Yeah, don't see anyone really wanting to stop this anytime soon. Especially as people become accustomed to urban densification. I don't really know too many my age who enjoy the 'suburbs', people are getting accustomed to urban living so have no issue with buying condos and townhouses near trendy areas etc.

Additionally, even if local buyers don't like the cheap townhouses or small condos and apartments, there's a ton of other immigrants who do. I'm seeing a lot of Filipino, Haitian, and other buyers of lots and houses that Indians or Chinese don't want to buy in places like Richmond and Surrey. Don't see it slowing down anytime soon, maybe once this generation grows up more, and their kids struggle to even afford apartment rent may the market crash, but in BC you had the premier say it's a Vancouver city issue, while the mayor of Vancouver says the premier should do something. Ideally both don't want to stop the sheer money that is coming in.

 

[Junior Mint]

Gonna be interesting to see what happens to Vancouver with its already non-existent economy when all the talented new grads leave because no one wants to get paid far less than in other cities, working in shitty satellite offices and nobody-companies, and not be able to afford a place to live.

 

[AlphaTwo00]

maybe once this generation grows up more, and their kids struggle to even afford apartment rent may the market crash

The worry cities should be concerned with is the potential brain drain that can happen: if your young people cannot afford to be in the city, especially the smart ones, they'll leave, and in turn, hurt the cities potential to hold businesses.

Edit: what Junior Mint just said.

 

[Unknown Soldier]

The Japanese (people) were not doing it. Japanese companies were buying up cheap office buildings in new york for a period. Its very different to this situation.

They were buying everything from golf courses to amusement parks. And I don't think there's any big difference between companies and individuals buying real estate in that sense. I was pointing more to the "irrational exuberance" that was seen in both examples. The Chinese stock market is currently in the toilet and their economy is cooling off pretty fast so there are more parallels between the Chinese in 2015 and the Japanese in 1991 than just wildly buying overvalued real estate everywhere.

 

[jey_16]

Been going on for years in Australia, I managed to buy a small townhouse about 10km from the city but when it comes time for a family home, good luck getting anything reasonable within 50km's.

Of course, if anyone says anything negative about this "foreign investment", you get accused of racism. Government has been trying to reign it in but it's too late, damage has been done

 

[Tabris]

Allowed a massive influx of foreign chinese real estate ownership, thereby raising the housing prices in Vancouver beyond what citizens of the city can actually afford. Houses in West Vancouver are going for multiple millions of dollars and are in some cases 4 or 5 million dollar teardowns. It was widely denied by the city and mayor until a recent study showed that chinese foreign ownership in multimillion dollar properties is actually causing the problem.

That "study" was such bullshit though, because all it did was look at last names, not whether they were foreign or not. Vancouver demographic is close to half mainland Chinese, and the study showed something like 70% of new homebuyers were of Chinese decent. So that would mean it's a bit over the normal demographic of Vancouver.

We won't get good information until long census and BC government pushing a more formal study.

Vancouver has a lot of foreign investment, not just from China, but China is one of the largest sources. Chinese nationals use it as a tax shelter. So the problem does exist, I just don't think it's as bad as being made out to be. That injection of money into our economy is a good thing, we just need higher speculation and foreign ownership taxes and re-direct that revenue into local ownership tax breaks to re-balance.

 

[Unknown Soldier]

These people should fuck off. Go build banana stands in Mongolia instead.

I'm not going to pretend I know what racism looks like but this post looks pretty fucking racist to me

 

[IdreamofHIME]

Vancouver should be a case study of how not to handle the situation.

I think London is the poster boy of how not to do this. Especially how this shit has daisy chained over the past few decades, from oil rich arabs, too russian playboys and now the chinese elite.
They've decimated the market for people who actually live there and created a false wealth and economy.

 

[jellies_two]

It's a particular contributor to the Sydney housing problem for sure, but I don't know how major - that's currently in dispute. I don't think it's as clear cut in Sydney anyway as this article says it is in the US

It's pretty clear cut IMO

Sydney is a big sprawling area and chinese buyers tend to focus on certain spots so the % of buyers varies from almost nothing (far away from the CBD) to 50% in some places. But the prices they pay without blinking set the headlines and indirectly set the valuations for the street, the suburb, the neighbouring suburb, and so on.

Also entirely new developments - which are allowed to be sold overseas - frequently are not even built for locals. Everyone says well Sydney is expensive because of population pressure and shortage of homes but when you build a condo with 100 units and they are marketing and selling in Shanghai and entirely sold out within hours of release, it doesn't take a statistical expert to realise that makes the supply tighter.

There are too many people getting rich off this money right now and renters or first home buyers are getting squashed. Only lip service is paid to enforcing existing laws on foreign investment. The tax office chases citizens for using a company car on the weekend, while $10m from corruption or who knows what walks into the country and converts itself to a house.

The people making the laws are the ones who profit, by selling the home they bought in a blue-chip suburb 5 years ago for $2m, for $7m, to money whose origin is mainland China & to an absent owner who doesn't care about ROI - because getting their money out of China and into some western country with the rule of law, is all the ROI they value.

My friend teaches english to the offspring of these new rich, they buy education to get a visa and with their visa, their parents buy property. There are rules around selling it when they leave but someone related will get a passport anyway. Nothing is tracked, nobody cares, everyone makes money. There is no market correction to fundamentals possible while the hot money keeps flowing in.

BTW: I've seen studies saying foreign property investment in Australia is not mostly from China, look, they say, Canada is like #2 on the list, No prizes for understanding how that comes about.

 

[djSyndrome]

The HOA for the new development we live in has a stipulation that houses must be owner-occupied for the first twelve months after closing, and after that no more than ten percent of the total units in the entire development (which is already over 400 houses, and two years into a 20-year plan) may be rentals.

As a result, every single one of my neighbors is an owner. The sense of community is fantastic and investors (foreign and otherwise) are kept out.

 

[BladeoftheImmortal]

People in Vancouver and Toronto have been waiting for years. I'll be dead before it happens. It may slow down, but pretending that it will drop now is highly unlikely.

There's only a finite amount of money. With the way they are buying properties in other countries that takes away money from their own economies. Most houses bought have no one in them in China. So once all the money leaves to a new country, there won't be any money in their home economy and house prices will fall everywhere. They'll be wanting to dump the properties abroad to bring money back to them. It may take a while, but it will happen.

 

[AlphaTwo00]

That "study" was such bullshit though, because all it did was look at last names, not whether they were foreign or not. Vancouver demographic is close to half mainland Chinese, and the study showed something like 70% of new homebuyers were of Chinese decent. So that would mean it's a bit over the normal demographic of Vancouver.

We won't get good information until long census and BC government pushing a more formal study.

Vancouver has a lot of foreign investment, not just from China, but China is one of the largest sources. Chinese nationals use it as a tax shelter. So the problem does exist, I just don't think it's as bad as being made out to be. That injection of money into our economy is a good thing, we just need higher speculation and foreign ownership taxes and re-direct that revenue into local ownership tax breaks to re-balance.

the last name study is bullshit, but the rest does hold up decent until a more realistic study shows up.


http://www.theglobeandmail.com/news/british-columbia/vancouvers-housing-market-fuelled-by-chinese-buyers-study/article27064577/?service=mobile

But further, the study found that on titles held by a single owner, the most common occupation was homemaker – 52 properties; 18 per cent were business people and 6 per cent of owners were students.

And 82 per cent purchased with a mortgage.

Mr. Yan acknowledged he could only deduce that buyers were purchasing with money from mainland China. But, he argued, it’s not much of a leap, considering the median income for 25- to 55-year-olds with bachelor degrees in Vancouver is $41,981. Those dependent on the local job market couldn’t compete.

You cannot tell me the students are buying 1 million houses. And you cannot tell me the median salary is buying those houses either.

 

[Madness]

Gonna be interesting to see what happens to Vancouver with its already non-existent economy when all the talented new grads leave because no one wants to get paid far less than in other cities, working in shitty satellite offices and nobody-companies, and not be able to afford a place to live.

Yup. A great example of how there are negative consequences to the money being poured in. I mean on the one hand, you're getting hundreds of millions of foreign dollars being pumped into the economy, on the other hand, you're pricing out the locals and residents who then have to move elsewhere for school, jobs, to live. 20 years ago, it was moving to Richmond and Surrey and Burnaby to afford something, now it's moving to Port Coquitlam and Pitt Meadows and Maple Ridge and Langley and even Abbotsford to work or reside anywhere close to the lower mainland.

The worry cities should be concerned with is the potential brain drain that can happen: if your young people cannot afford to be in the city, especially the smart ones, they'll leave, and in turn, hurt the cities potential to hold businesses.

Edit: what Junior Mint just said.

Yeah, brain drain already an issue for Canadians. I mean I'm definitely noticing people leaving the lower mainland, moving to the interior for school, work, going to other provinces like Alberta or Saskatchewan or even Washington.

Plus like you said, small businesses probably hurt the most. Who can afford to pay someone to work their tiny restaurant and afford something nearby. It's crazy how even the smaller cities created to help ease this are priced out as well.

 

[Gallbaro]

The worry cities should be concerned with is the potential brain drain that can happen: if your young people cannot afford to be in the city, especially the smart ones, they'll leave, and in turn, hurt the cities potential to hold businesses.

Edit: what Junior Mint just said.

In Alpha cities brain drain does not matter. Their public education systems can suck, they just import talent.

 

[AlphaTwo00]

In Alpha cities brain drain does not matter. Their public education systems can suck, they just import talent.

Which is how Toronto is holding up for now, the question what happens to Vancouver.

More importantly, importing talent only addresses the high end workforce. If you cannot keep the low and middle income stable, you have a problem as a functional city.

 

[anaron]

Plenty of the people pissed off at the mainland Chinese investors are Canadians of Asian descent, like myself.

We should really pinpoint our ire at our politicians, as they are the ones who continue to allow this to happen.

Definitely.

aka, VOTE NDP

 

[shira]

The Japanese were doing this just before their economy crashed and burned in the 1990's.

Let's hope the Chinese are a bit better with managing their economy than the Japanese were.

 

[perfectchaos007]

Donald Trump was right?

 

[iamblades]

They were buying everything from golf courses to amusement parks. And I don't think there's any big difference between companies and individuals buying real estate in that sense. I was pointing more to the "irrational exuberance" that was seen in both examples. The Chinese stock market is currently in the toilet and their economy is cooling off pretty fast so there are more parallels between the Chinese in 2015 and the Japanese in 1991 than just wildly buying overvalued real estate everywhere.

^^ this is the more worrying bit.

Real estate investment is almost always either a flight to safety or a bubble. Neither one is a good sign for the Chinese economy.

A bubble can only sustain itself so long because the Chinese economy is only so large, and the percentage of Chinese people with the spare cash to dump into real estate is an even smaller percentage, so if it's just a case of newly unchained cash inflating a bubble, in the long run it will hurt the Chinese investors more than the people currently being priced out of the market.

 

[Byakuya769]

Foreign investment and residential property seem anathema on its face. Maybe we should think better of protectionist policies in certain arenas.

 

[vern]

Been going on for years in Australia, I managed to buy a small townhouse about 10km from the city but when it comes time for a family home, good luck getting anything reasonable within 50km's.

Of course, if anyone says anything negative about this "foreign investment", you get accused of racism. Government has been trying to reign it in but it's too late, damage has been done

How is it not racism or xenophobia though? Why does it matter who buys what and where? We should all be free to move about the planet as we please and buy whatever we can afford.

There's only a finite amount of money. With the way they are buying properties in other countries that takes away money from their own economies. Most houses bought have no one in them in China. So once all the money leaves to a new country, there won't be any money in their home economy and house prices will fall everywhere. They'll be wanting to dump the properties abroad to bring money back to them. It may take a while, but it will happen.

Most? Are you high?

 

[Dalek]

How is it not racism or xenophobia though? Why does it matter who buys what and where? We should all be free to move about the planet as we please and buy whatever we can afford.

Oh boy.

 

[Eighty Deuce]

How is it not racism or xenophobia though? Why does it matter who buys what and where? We should all be free to move about the planet as we please and buy whatever we can afford.

Because people who grew up in an area should have a right to buy into the community (based on average income of the area) over a distant foreign investor who could give two shits about it.

 

[AlphaTwo00]

How is it not racism or xenophobia though? Why does it matter who buys what and where? We should all be free to move about the planet as we please and buy whatever we can afford.

I think there is a stark difference between a specific race, "aka, put barriers against anyone Chinese in buying" vs "make it reasonable for locals into the market". It's extremely unhealthy for a community where half the street gets completely gutted and rebuilt, and the houses are unlived in (this is happening in Vancouver) - sure there is a boom in construction: but when you realize the community is half vacant, you then realize there are other repercussions: infrastructure like water and electricity isn't utilized and degrade without the parallel fees, services like fire, police are not paid and reduce, etc.

 

[Madness]

How is it not racism or xenophobia though? Why does it matter who buys what and where? We should all be free to move about the planet as we please and buy whatever we can afford.

*Sigh*...

 

[AlexMogil]

Check out Vancouver's (Richmond's) awesome cash-only economy too. Goes along with it.

 

[vern]

Oh boy.

So if a bunch of rich Aussies bought up all the property instead of Chinese what is the difference?

 

[Gallbaro]

Which is how Toronto is holding up for now, the question what happens to Vancouver.

More importantly, importing talent only addresses the high end workforce. If you cannot keep the low and middle income stable, you have a problem as a functional city.

Why? The poor and middle class will just rely on a second income, longer commutes, and functionally tenement capacity housing to pay for their rent. Its not a economic problem for a Alpha city, they experience surplus revenues and growth when this is happening. Its a complicated political one problem that involves many factors including a lack of new high density construction and the misplaced dogma that lots of cheap money, inflation, is good for labor.

Edit: If you want less foreign money coming into local housing stocks and an immediate drop in housing prices and rent then the US Fed needs to raise rates...

 

[Dalek]

So if a bunch of rich Aussies bought up all the property instead of Chinese what is the difference?

There wouldn't be. However this article is reporting on what is really happening.

 

[jellies_two]

They were buying everything from golf courses to amusement parks. And I don't think there's any big difference between companies and individuals buying real estate in that sense. I was pointing more to the "irrational exuberance" that was seen in both examples.

It isn't irrational exuberance.
It has nothing to do with the Chinese economy either.

This is all about the rich in China getting a portion of their money out of the country and safely secreted overseas before they wake up to find that someone with more power than them decides to strip their family of their wealth, or as an insurance policy if there is ever social upheaval on a grand scale.

And the more the money accrued from corruption, or environment degradation, or anything else that can be used as leverage to make their wealth look bad, the more desperately they want to escape the capital controls.

The same forces are at work in Russia as well. If you cross Putin you can lose everything. So you put it into London where it can't easily be seized.

Hot money is hot money there are many bubbles that shows the risks, the Japanese bubble influence on the US seems pretty benign in retrospect. So they bought some high profile buildings and golf courses? the GFC is more illustrative of the risks to a city when home property prices divorce from reality.

 

[AlphaTwo00]

Why? The poor and middle class will just rely on a second income, longer commutes, and functionally tenement capacity housing to pay for their rent. Its not a economic problem for a Alpha city, they experience surplus revenues and growth when this is happening. Its a complicated political one problem that involves many factors including a lack of new high density construction and the misplaced dogma that lots of cheap money, inflation, is good for labor.

I understand your point, but I can tell you this isn't happening in Toronto, for the 3rd year in a row, the #1 in new high rise constructions for North America (130+ built), with the average condo unit at 400K+. High density construction is here, and investors, both local and forigen, are snapping them up as there is no downward trend in sight. Home values in the GTA outpaces any monetary investments, and it's not a surprise that increase in housing built isn't slowing anything down.

I know it's a very specific example, but it's a very similar one to what has happened in Vancouver.

Of course, you can say that what I'm pointing out is a uniquely Canadian issue, so in the case, good luck?

Edit: If you want less foreign money coming into local housing stocks and an immediate drop in housing prices and rent then the US Fed needs to raise rates...

While that will slow down local investment, it actually doesn't do anything to the Chinese investments: what you're not seeing is that China is cracking down on their economy, and anyone who can is trying desperately to divert their holdings outside of China. Your interest rate increase ain't doing shit if they just pay cash.

 

[BreezyLimbo]

So if a bunch of rich Aussies bought up all the property instead of Chinese what is the difference?

People would still pissed off. Look at San Francisco, all the tech companies settling in, causing prices to go up...these tech companies tend to be faceless in terms of race. People still hate it.

 

[Jintor]

How is it not racism or xenophobia though? Why does it matter who buys what and where? We should all be free to move about the planet as we please and buy whatever we can afford.

high-minded of you, but bear in mind that a) real estate property is not easily portable due to its nature b) it costs a lot to move and poorer (or even middle class) people being priced out of where they currently live by rich people from elsewhere is problematic in and of itself. (also associated burdens on transport networks etc)

If a lot of rich aussies were buying canadian property it would probably have less overtly racist/xenophobic implications but for canada it's roughly the same problem: people who actually live there being priced out of the location where they actually live

 

[shira]

I understand your point, but I can tell you this isn't happening in Toronto, for the 3rd year in a row, the #1 in new high rise constructions for North America (130+ built), with the average condo unit at 400K+. High density construction is here, and investors, both local and forigen, are snapping them up as there is no downward trend in sight. Home values in the GTA outpaces any monetary investments, and it's not a surprise that increase in housing built isn't slowing anything down.

I know it's a very specific example, but it's a very similar one to what has happened in Vancouver.

Of course, you can say that what I'm pointing out is a uniquely Canadian issue, so in the case, good luck?

Anecdotal: I don't personally know anyone buying those condos though. That leads me to believe that locals aren't living there.

 

[jabuseika]

We should all be free to move about the planet as we please and buy whatever we can afford.

Because they're not buying property to live there.

They're artificial pricing out locals of middle and low income backgrounds.

If only rich locals were buying out property, they would have an investment in the local economy.

Foreign money doesn't care about the local economy, they just want to turn over wealth, and take it back with them.

 

[AlphaTwo00]

Anecdotal: I don't personally know anyone buying those condos though. That leads me to believe that locals aren't living there.

i know too many. And at least a 50% split is using them as rental investments: HGTV has taught too many people that they can flip for a quick buck if needed.

 

[0.1.1.2.3.5.8.13.21.34.55]

I hope their money buys more impressive things than that statue.

 

[vern]

high-minded of you, but bear in mind that a) real estate property is not easily portable due to its nature b) it costs a lot to move and poorer (or even middle class) people being priced out of where they currently live by rich people from elsewhere is problematic in and of itself. (also associated burdens on transport networks etc)

If a lot of rich aussies were buying canadian property it would probably have less overtly racist/xenophobic implications but for canada it's roughly the same problem: people who actually live there being priced out of the location where they actually live

People are highly portable though. We have a weird affection for a place simply because we were born or grew up there. I never understood the sentiment. The world is big and there are options out there. If you can't afford to live somewhere then go somewhere else. There shouldn't be any place in a developed country that people can't afford to live though, it's a problem for government to solve. Every community has low income jobs, and people should be able to live near their workplace.

*Sigh*...

I'm not saying it's healthy for the neighborhood, community, city, state, country, whatever. We can't all be rich and have properties stashed around the world. That's a shitty fact of life. I'm not rich and I can't afford a house in Sydney or Vancouver or whatever.

Would I prefer these rich people contribute to the places that they buy into? Yeah of course. Does it suck that local people get priced out? Yeah it does. Should rich people donate this excess cash to charity instead? Yeah, that's a nice idea.

But as a person who has lived in multiple countries and continents, policies limiting movement of people or policies directly impacting the freedom of people to live however we please suck ass. Policies directly aimed at people just because they are born somewhere else are moronic. The world should be for everyone. I know it never will be, I'm not naive, but it should be.

 

[Antiwhippy]

People are highly portable though. We have a weird affection for a place simply because we were born or grew up there. I never understood the sentiment. The world is big and there are options out there. If you can't afford to live somewhere then go somewhere else. There shouldn't be any place in a developed country that people can't afford to live though, it's a problem for government to solve. Every community has low income jobs, and people should be able to live near their workplace.



I'm not saying it's healthy for the neighborhood, community, city, state, country, whatever. We can't all be rich and have properties stashed around the world. That's a shitty fact of life. I'm not rich and I can't afford a house in Sydney or Vancouver or whatever.

Would I prefer these rich people contribute to the places that they buy into? Yeah of course. Does it suck that local people get priced out? Yeah it does. Should rich people donate this excess cash to charity instead? Yeah, that's a nice idea.

But as a person who has lived in multiple countries and continents, policies limiting movement of people or policies directly impacting the freedom of people to live however we please suck ass. Policies directly aimed at people just because they are born somewhere else are moronic. The world should be for everyone. I know it never will be, I'm not naive, but it should be.

That's the thing, most of them aren't buying it to be more portable, they're buying it as an investment, either by driving up real estate prices or through rental, thus pricing out the locals.

 

[AlphaTwo00]

But as a person who has lived in multiple countries and continents, policies limiting movement of people or policies directly impacting the freedom of people to live however we please suck ass. Policies directly aimed at people just because they are born somewhere else are moronic. The world should be for everyone. I know it never will be, I'm not naive, but it should be.

Great, and it should be. And if the case in many of these cities were a rich guy coming in and buying the place and living there, fantastic. I think we're more than happy to welcome them. What is happening though is you're getting investors buying into an area, and never lives there. In many cases, the community becomes a ghost town: half the houses aren't lived in, there's no neighbour, it's breaking a community, and it's actually preventing people from moving into a community.

The wave of investment property purchases isn't for people moving, it's for investment. The hard part is for any legislation to separate what is a investment purchase vs a live in purchase.

 

[Keri]

We have a weird affection for a place simply because we were born or grew up there. I never understood the sentiment.

The place where you grew up, is probably the place where all your family and friends are. That's a large reason why many want to stay there (it's not the place, so much as all the people).

 

[Madness]

So if a bunch of rich Aussies bought up all the property instead of Chinese what is the difference?

The fact they aren't, answers your question. This is a consequence of a globalized world and people from tightly controlled and regulated countries, trying to 'hide' their money overseas where it's safe. For the same reason so many people used Swiss and Cayman banks for money laundering, a lot of rich Mainland Chinese, Russians and Arabs are buying up properties in London, New York, Toronto, Vancouver, Sydney etc.

It's a safe investment. If it's corrupt money, they could have it seized by their authoritarian governments. A similar phenomena happened with Japan in the 80's, and in 20 years, mainland Chinese buyers will probably be replaced by Indian businessmen and investors, but to a lesser scale because they can just invest in their own countries without fear of their money being seized.

The problem here is its happening at such a huge scale and is not being regulated that it's pricing out the local residents, wreaking havoc on their lives. What does the guy living in Moscow or Beijing care that a married couple cannot afford to live in Vancouver, forced to move elsewhere to raise their kids or go to school and whatnot. It's even different than the 'waves' of the early 80's and 90's when Punjabi Indians moved to Canada in great numbers bringing wealth to places like Surrey or Brampton, because their kids will grow up and contribute to the local economy, same thing in 97, when a lot of people fleeing Hong Kong moved to places like Richmond because their kids will grow up and contribute to the economy overall. Now though, most of these units are sitting empty, built just for a quick sale, or are not able to be afforded by the local populace etc. It's not so much about preventing a 'certain' group of people like you're thinking.

 

[numble]

There's only a finite amount of money. With the way they are buying properties in other countries that takes away money from their own economies. Most houses bought have no one in them in China. So once all the money leaves to a new country, there won't be any money in their home economy and house prices will fall everywhere. They'll be wanting to dump the properties abroad to bring money back to them. It may take a while, but it will happen.

The houses are cheap by Chinese first-tier city standards, and the Chinese first-tier cities already restrict the homes that can be bought (even if you are a Beijinger sitting on a house you bought cheap in the early years of the boom and you have earned tons of money in the intervening years, you can only buy 1 more house in Beijing--you can't even buy in Shanghai if you want to).

A second home overseas is cheap compared to a house in their own market (and they are further restricted from buying in their own market), and overseas visas are relatively easy to obtain. For families with 8-figure net worths, a $500,000-$1 million home is nothing, and definitely not worth dumping to bring money back in.

 

[Jintor]

People are highly portable though. We have a weird affection for a place simply because we were born or grew up there. I never understood the sentiment. The world is big and there are options out there. If you can't afford to live somewhere then go somewhere else. There shouldn't be any place in a developed country that people can't afford to live though, it's a problem for government to solve. Every community has low income jobs, and people should be able to live near their workplace.

Right, and they are going to live somewhere else, but their jobs are still in Sydney CBD so now they have a hour/hour-half/two-hour commute, or they can't get good schools because they've been pushed out into the outer suburbs or the inner west, or whatever. I mean on one hand that's fairly normal as well and maybe you'll get further development of satellite cities like Newcastle or Wollongong, but not everybody getting pushed out is a trendy twenty-something jetsetter with no family and no ties to a place that can easily pack up and move.