They say things come in three's

Ya gotta love watching the way a entity attempts to manipulate it's message.

First it was a Greater Vancouver Real Estate Board survey of Realtors which told us that after studying 1246 sales over the Jan-May 2011 period, the GVREB concluded that more than 80% of buyers of Vancouver Real Estate are locals and only 7.5% came from outside of Canada.

On the heels of that study came another. This time conducted by Landcor Data Corp as reported by the Financial Post.

Landcor Data Corp said it has been been tracking property tax assessment bills to pinpoint the percentage of transactions driven by foreign investors in Vancouver’s suburbs. It concludes that that while sales of Vancouver Real Estate to foreigners are prevalent in high end properties, the dollar amounts of those sales are severely skewing the average property values in Vancouver.

This prompted the Urban Futures Institute, a Vancouver research firm that worked with Landcor, to say the data proves that influence of foreign investment is not a major factor in most of the Lower Mainland. "These data contradict what seems to be largely anecdotal evidence indicating foreign investment is a significant driver to residential price increases in the Lower Mainland.”

And now, completing the troika of articles disavowing the idea that Hot Asian Money (HAM) is playing a significant role in the Vancouver Real Estate bubble, is this offering via the Globe and Mail.

The article attempts, in one paragraph, to reduce the topic of HAM to a vicious Internet rumour. Headlined "What's driving Vancouver House Prices", we are told:

• "The China Daily ran a story – later picked up by a Forbes blog – which said that "according to Colliers International, a real estate service provider, the proportion of Chinese buyers in Vancouver's property market is on the rise."

The new 'reality'?

• But alas, nothing is so transparent in a market such as Vancouver, which doesn't actually track foreign investment. The Colliers report believed to be at the heart of the article – Marketshare First Quarter 2011 – doesn't actually quantify the number of buyers and goes out of its way to play down the effect they may be having. 'There seems to be more myths than facts about Mainland Chinese investing,' Colliers president Greg Ashley wrote in the intro.

And this is the meat of the latest tactic; to discount HAM as a 'myth'. Collier's (a local real estate company) outlines how, while HAM exists, it isn't dominant:

• "This trend is certainly impacting single family housing values in Vancouver-West and Richmond. However, it is not the driving force behind all sales. A number of recent launches reported large numbers of Asian buyers - yet a significant portion of these buyers are actually local residents not foreigners."

For almost 2 years now the Real Estate industry has been keen to promote HAM, to use HAM to justify the Vancouver housing bubble, to use HAM to defend the low interest rate policy/lax mortgage rules. To use HAM to promote the setting up of Real Estate offices in mainland China to sell local R/E. To use HAM as media events promoting helicopter trips to showcase local developments to overseas buyers, etc.

They have done this while insisting that Canadians aren't really over-extending themselves with debt - by claiming that it's actually foreign investment that is making all these outlandish purchases, not Canadians.   

Local blogs, who have insisted that the impact of HAM is not as signficant as many realtors have claimed and have been saying that Vancouverites are IN FACT over-extending themselves with debt, have been dismissed and marginalized.

Suddenly the tables have turned.  Suddenly we are awash in stories from the R/E industry about how HAM is not a significant factor in Vancouver Real Estate.  That the vast majority of purchases are being made by locals and not foreigners

Why do you think that is?

==================

Email: village_whisperer@live.ca
Click 'comments' below to contribute to this post.

Please read disclaimer at bottom of blog.

Riddle me this?

Last Sunday's post was titled 'What's Wrong Here'. 

Juxtaposed against a Global TV news story about Vancouver home prices being the most expensive in the English speaking world when compared to the income we make (the cause of which is attributed to the infamous Hot Asian Money - HAM - whereby wealthy Asian foreigners drive up local real estate prices with their Tsunami of purchases in the Village on the Edge of the Rainforest) was a survey from local realtor Larry Yatkowsky showing that only 7.5% of buyers of Vancouver real estate are wealthy foreigners from outside of Canada.

Curiously, only days later, a Financial Post story recounts the results of study by Landcor Data Corp.

Landcor says it has been tracking property tax assessment bills to pinpoint the percentage of transactions driven by foreign investors in Vancouver’s suburbs.

Out of the 55,512 sales in 2010 only 195 were to people outside of Canada. Foreign investors only own 0.5% of the total housing stock of 774,600 residential properties in the Lower Mainland.

Interestingly... sales to foreigners are prevalent in high end properties, the dollar amounts of which are said to be severely skewing the average property values in Vancouver.

In 2008, there were 69 sales of homes priced at $3-million or more, the most expensive $10.5-million, and 46% were purchased by Chinese buyers. By 2010, there were 164 sales in the same category, the highest-priced being $17.5-million, and 74% went to Chinese buyers.

Andrew Ramlo, executive director of The Urban Futures Institute, a Vancouver research firm that worked with Ledcor, says the data proves that influence of foreign investment is not a major factor in most of the Lower Mainland.

• “These data contradict what seems to be largely anecdotal evidence indicating foreign investment is a significant driver to residential price increases in the Lower Mainland.”

Hmmm.

Is HAM a major impact or isn't it?

Is our region plunging itself into massively unbalance debt as a ratio to income? Or are the high prices justified because of foreign investment and thus there is no debt problem that has to be addressed?

Should limits be put on foreign investment or is all the talk about foreign investment an urban myth?

For several years now the Real Estate industry has been telling us that Asian money is flooding into the market, that it is driving prices higher and that we should buy now or be priced out forever.

Now, suddenly, studies seem to be popping claiming there isn't that much Asian money flowing in, after all.

I sense a disquieting metamorphosis in the information being put out be the real estate industry and I can't help but question the motivations behind it.

==================

Email: village_whisperer@live.ca
Click 'comments' below to contribute to this post.

Please read disclaimer at bottom of blog.