WATCH: After months of speculation, we finally have data on how many foreign buyers are snapping up B.C. real estate and most are from China. But are the numbers accurate? Tess van Straaten takes a look.
The numbers are truly shocking.
More than 10,000 residential real estate transactions took place in British Columbia in less than three weeks, totaling more than $7.6 billion.
In the Capital Region, there were 737 transactions in the same period and a total of almost half a billion dollars in real estate changed hands.
And now, for the first time, there’s data on how many of those sales were foreign buyers.
Of the 10,148 sales in B.C. between June 10-29th, 337 sales were from people who aren’t Canadian citizens or permanent residents.
That accounts for just 3.3 per cent of total transactions but they spent $390,000 million, which is 5.1% of the total money spent.
The vast majority of the buyers — 258 — were from China.
Buyers from the United States were a distant second at 23.
In the Capital Region, 17 sales (2.3 per cent) were foreign buyers who snapped up $12.5 million worth of residential real estate.
“There are foreign nationals from countries around the world purchasing properties in BC,” B.C. finance minister Mike de Jong said at a news conference to release the data. “We know that as a fact now.”
But reaction to the news was swift.
“Almost $400 million of economic activity is the result of foreign investment,” NDP leader John Horgan says. “That means British Columbian’s have been squeezed out of $400 million of real estate activity and I think that’s wrong.”
NDP critics say the way foreign buyer data was collected is ‘totally unreliable’ and real estate crisis much bigger than what the numbers show
Critics also take issue with not just the small sampling of data, but also how it was collected — by people self-identifying on the property transfer tax form, which doesn’t take into account numbered companies and blind trusts.
“The problem with self-reporting is that it’s very easy to not report accurately,” NDP housing critic David Eby says. “We suspect this is actually just a small fraction of what’s happening in the real estate market.”
To get the full picture, critics want the government to compare income tax information against land title data and then tax foreign speculators who are driving up prices.
“It’s absolutely ridiculous and it’s time for action,” Horgan says. “We’ve proposed a speculation tax to reign in this wild speculation and for the housing market to reach a level British Columbians can once again afford to participate in.”
The finance minister admits it’s challenging situation but he’s trying to put a positive spin on it.
“No doubt this represents a challenge,” De Jong says. “But it’s a challenge virtually every other jurisdiction would like to have because it is a challenge associated with a growing economy.”
The government is now considering the various options and plans to update the foreign buyer data monthly.
Here’s a link to the full report