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By Edwin Lane Business reporter, BBC World Service, Vancouver
26 May 2016
Vancouver real estate agent Bryan Yan is riding the wave of a property market
boom.
On Point Grey Road in the west of the city - known as Vancouver's
"Billionaires' Row" - he shows me around a two-bedroom house on the market for
just short of 11m Canadian dollars ($8.4m; 5.7m).
The interior is all wood panelling and polished concrete. A terrace opens out
onto the bay where boats bob in the water and seaplanes take off and land. From
the Jacuzzi there are views of the snow-capped mountains in the distance.
In the past five years Bryan estimates that prices on this street have risen by
about 120%, driven by demand from the international jet-set looking to add
Vancouver to their list of homes around the world.
"It's great for business," he tells me, but admits: "It's irrational. If you
look at the prices and the graphs, it's off the charts."
Out of reach
Vancouver property is red hot, and not just at the luxury end of the market.
Average house prices in the city are rising at record rates of 20-30% a year,
and a typical detached house now costs about C$1.3m.
That's way beyond the means of most Vancouverites in a city with one of the
lowest median household incomes in the country.
The Royal Bank of Canada warned recently that Vancouver is becoming
"dangerously unaffordable". A recent study ranked Vancouver as the least
affordable city in North America.
"We're an international freak show," says David Eby, a member of British
Columbia's legislative assembly for Vancouver-Point Grey and housing spokesman
for the opposition New Democrat Party.
On the walls of his community office in west Vancouver are testimonials of
residents who have been forced to move out of the city by the rising cost of
housing.
He says the local economy simply isn't big enough to justify the sky-high
property prices.
The result is an exodus of young people from the city. The local economy is
being damaged and quality of life is being harmed.
Manhattan, London, Vancouver
Mr Eby says it is clear that a huge influx of foreign money is to blame.
"Black Rock, the world's largest investment firm, tells investors from around
the world: 'Don't invest in gold anymore, invest in condos in Manhattan, in
London, and in Vancouver,' and to people who live here that seems so crazy -
why would Vancouver be on that list?"
One of the reasons of course is that Vancouver's natural setting makes it an
attractive place to live. But another is its strong ties across the ocean to
the Asia-Pacific region.
Researchers say much of the money now flowing into the Vancouver market is
coming from China.
Wealthy Chinese looking for a safe place to park their money have gained access
to the market through an immigrant investor programme started by Canada in the
1980s.
But hard data on how much money is actually coming in and where it's coming
from is scarce.
Cameron Muir, the chief economist at the British Columbia Real Estate
Association, says the influence of foreign money is being vastly overstated.
"Yes absolutely, we've had a larger share than other areas of Canada of
investor-class immigrants who have come to Vancouver with a lot of wealth and
they have for the most part bought homes here.
"But to say that somehow foreign investment is making it unaffordable for
first-time buyers to get into the housing market in Vancouver is a bit of a
stretch."
Frustration
That is rejected by David Eby. "It's a lot like the tobacco executive saying
there's no proof that smoking causes cancer," he says. "It's so obvious what's
happening in our market here."
Andy Yan, an urban planner at Bing Thom Architects, is among those frustrated
by the lack of information on who owns what in Vancouver.
I meet him in the shadow of huge condominium towers that dominate the skyline
of downtown Vancouver. He conducted his own research using census data and
electricity usage and found that nearly a quarter of these condominiums were
empty - suggesting they are being used as parking spaces for cash rather than
places to live.
"The issue is who is [the city] supposed to serve?" he says. "The notion that
this is a city where you can have a life cycle of being single in your
twenties, having a professional life and then going and raising a family is
being increasingly challenged."
Campaigners are calling for curbs on foreign investment in the shape of higher
taxes on property ownership, fearing that Vancouver will soon become little
more than a parking space for wealth.
Last year Vancouverite Eveline Xia started a Twitter campaign under the hash
tag #donthaveamillion, highlighting the affordability crisis.
"Personally more than half my friends from university have left and that's been
quite tragic for me," she tells me. "I'm probably going to leave too, I'm
planning an exit strategy."
For David Eby, its the loss of Vancouver's youth that is most worrying.
"We desperately need people to come and live here who have skills of certain
types," he says. "We need to fulfil our international refugee obligations.
"What we don't need is a lot of millionaires to move here to support the local
Ferrari dealership - which we now have."