Douglas Todd: Is B.C. immigration program a back door for millionaire house buyers?

Yet the emphasis of so-called ‘provincial nominee programs’ is supposed to be on newcomers looking for a job.

The emphasis of so-called ‘provincial nominee programs’ is supposed to be on newcomers looking for a job, yet many seem able to afford pricey Vancouver real estate. Mark van Manen / PNG

How did it come to pass that thousands of people who came to Metro Vancouver through a provincial immigration scheme bought pricey houses?

A Statistics Canada report shows 2,370 people who recently arrived in B.C. through a provincial immigration program have bought single-family houses worth an average of $2.38 million in Metro Vancouver, which is $800,000 above the norm for Canadian-born house buyers.

It’s a startling figure, in part because politicians often trumpet how the relatively small provincial immigration programs were created primarily to fine-tune Ottawa’s bulkier immigration policy by pinpointing the right skilled workers for each local labour market.

Given that the emphasis of so-called “provincial nominee programs” is supposed to be on newcomers looking for a job, how have thousands since 2009 been able to quickly buy pricey Metro Vancouver real estate? It’s difficult to get an answer from officialdom. So we’re left to our own devices to figure out this irregular access.

I’m not alone in suggesting one of the last things most young people need in Metro Vancouver’s unaffordable housing market is to be squeezed out by another stream of foreign capital. The B.C. NDP government is among those trying to crack down on this price-inflating phenomenon associated with “satellite families” who buy stately homes.

But the revealing data is there in the particulars of a January Statistics Canada report. Its charts point to the way many families are coming to Metro Vancouver with large amounts of wealth, which they’ve been funnelling into housing.

Chart shows value of Metro Vancouver detached homes bought by recent newcomers under the Provincial Nominee Program and other immigration investor schemes. (Source: Statistics Canada report titled Immigrant Ownership of Residential Properties in Toronto and Vancouver.)

And it’s not only Metro Vancouver’s housing market that has been hit by millionaire migrants entering through provincial immigration programs. So has Greater Toronto’s. The average price of a Toronto house bought by a recent provincial nominee is $1.06 million, according to the StatsCan report, while the average price of a detached house of Canadian-born owners in Toronto is significantly less, $849,000.

And just as in Metro Vancouver, it is the recent newcomers to Toronto from China who have had the most cash to spend on property. Mainland Chinese make up about two of three of the home buyers in each city who arrived through the nominee program.

Related

The StatsCan report, titled Immigrant Ownership of Residential Properties in Toronto and Vancouver, offers only a snapshot of this provincial nominee mansion phenomenon, however. It doesn’t capture the program’s link to condominiums. And it leaves open speculation about causes.

Therefore, many questions remain outstanding about what is going on with provincial nominee programs, questions which are typically paid little heed.

B.C.’s provincial nominee program brought 6,500 newcomers to the province in 2018, almost triple the number it welcomed a decade earlier.

But it is a puzzle how 2,370 provincial nominees since 2009 were able to quickly buy costly houses in Metro Vancouver, especially when the vast majority of such nominees were classified as “workers.”

Only about one per cent of provincial nominees to B.C. — an average of about 80 a year ­— arrive under the “entrepreneur” category. They are the ones who are worth more than $600,000 and required to invest $200,000 in a B.C. business. It’s common sense to expect many in this tiny group of entrepreneur/investors to arrive in B.C. with capital and to pump part or most of it into real estate.

That is exactly what happened with the federal government’s investor program, which the Conservatives killed in 2014 because so many rich immigrants were snapping up Canadian property but not operating businesses or paying significant income taxes.

Despite such unintended consequences, a large entrepreneur program continues to be run by Quebec. It cynically takes millions from thousands of rich would-be immigrants each year, even while most hastily move to Vancouver or Toronto.

Indeed, the January StatsCan report shows the average value of a detached house bought by more than 4,400 millionaire immigrants who came to Metro Vancouver in the past decade under Ottawa’s investor program, and the one operated by Quebec, is $3.2 million. That’s unfortunate enough in regards to fuelling high-end prices, with its trickle-down effect to all housing.

But how is it that the much smaller provincial nominee programs of B.C. and perhaps other provinces are also bringing in thousands of wealthy home buyers headed for Vancouver and Toronto?

A spokeswoman for B.C. Ministry of Jobs, Trade and Technology, which oversees the provincial nominee program, wouldn’t venture a guess. “It is good to see newcomers coming to Canada and being able to invest in their own business and homes,” she said. “We are unable to speculate on the amount of foreign capital they bring into Canada.”

The minister of jobs, trade and technology, Bruce Ralston, also declined to comment until he had a look at the Statistics Canada report. “It’s an area where I’d have to have the facts.”

In the meantime here are a few questions that need to be answered.

Is it possible many of the buyers of Metro Vancouver mansions are coming in not only from B.C.’s nominee program, but from other provincial programs, such as that in Prince Edward Island, which was cancelled last year. It was riddled with fraud and hundreds of would-be immigrants used fake addresses to pretend they lived in P.E.I.

Another question is whether people buying expensive Metro Vancouver properties are coming in through a camouflaged nominee category, such as “skilled worker.”

The top occupations of those coming in the past two years under the B.C. provincial nominee’s “skilled worker” category were restaurant and food service employees, including cooks and kitchen helpers, as well truck drivers and retail managers.

While Ralston said he needs to gather more information before commenting on whether immigrants who buy expensive houses in Metro Vancouver are coming in as truck drivers, food workers or another irregular category, he noted Attorney General David Eby and Finance Minister Carole James are trying to tackle a related aspect of the housing crisis.

The two major aims of the ministers’ new speculation and vacancy tax are to increase housing supply by reducing the number empty dwellings and targeting satellite families, who often buy and live in expensive properties but pay little or no income tax in Canada.

Since thousands of millionaire migrants appear to have found backdoor ways to enter Metro Vancouver’s over-priced housing market through the Provincial Nominee Program, it looks as if this scheme is part of the problem. As such it needs far more scrutiny.

[email protected]

@douglastodd

Источник: Vancouversun.com

Источник: Corruptioner.life

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