A recent study has shown that overseas buyers are outdoing local buyers in Vancouver's red-hot residential real estate market. The said study was executed by Andy Yan of Bing Thom Architects and it was documented that there are more students than doctors, buying housing in Vancouver's expensive west side, according to Global News.
Based on the results, Yan concluded, "Perhaps these students have access to a certain amount of capital." Critics have been questioning how these students could afford expensive properties compared to other professionals.
On the other hand, in Yan's study of 176 home purchases within a six-month time span, it is not impossible that the capital may be from outside of the country, specifically two-thirds are believed to have come from Chinese from Mainland China.
But speaking of the study conducted by Yan, B.C. finance minister Mike de Jong advises, "Relying on people's names as an indication of certain things can be a bit unreliable."
Yan's methods are not classified scientific because he conducted a research that is based on titles, non-anglicized Chinese names and associated jobs including homemakers, students or businessman to determine where the investment funds originated from.
Further explaining his study, Yan acknowledges that some of his discoveries need to be addressed such as the manner which banks have granted mortgages to buyers who belong to the lowest tax classification. He has added, "Eighty-two per cent of our study population was financed."
"It really reinforces for me the phenomenon of what's called the 'astronaut family,' which is dad's in China, mom and the kids are in Vancouver," according to David Eby, MLA for Vancouver-Point Grey. He continued, "They're going to school in Vancouver and dad's supporting the family."
It was also reported that a certain bank has eased its lending requirements for buyers with no local credit history but no further details were shared. Concerned that this is currently the case, Eby said, "If this is what's driving our real estate market, we're incredibly vulnerable to a shift in economic realities in China. If that part of the market dries up, where's the resiliency in the rest of the market?"1
