The first set of B.C.'s foreign home ownership data suggests offshore investment is affecting Vancouver region's superheated real estate market, but the provincial government says it could be months before it has more concrete statistics that will allow it to determine what, if anything, to do about it.
Figures released Thursday show foreign citizens bought five per cent of homes sold in and around Vancouver over three weeks last month. On average, foreigners spent about $1.35-million per home during this period, which was about $300,000 per home more than Canadian citizens or permanent residents spent in the region.
Addressing the public outcry for hard evidence, Finance Minister Mike de Jong promised to provide monthly updates on the numbers.
On Friday, his spokesman said the government would continue to study the data, but would not say to what end. So far, the finance minister has resisted calls for a tax on foreign ownership.
"It's premature to speculate on what the range of options might be because, right at the moment, we have 19 days of data," his spokesman said.
The province studied 10,000 transactions equalling more than $7.6-billion over three weeks last month, but the data ends before the last day of the month – which is when a large number of deals close. The ministry said only a small number of sales involving bare trusts or numbered companies – both modes speculators can use to hide citizenship – were tracked during this period.
Mr. de Jong's spokesman said the ministry released the data at the "earliest opportunity" in order to meet public demand.
Critics argue there are larger holes in the data than the small window of time it encompasses.
Richard Kurland, a Vancouver immigration lawyer who works with wealthy clients from China, said the government should break the statistics out into postal codes so foreign ownership of high-end homes could be better tracked, and ultimately taxed. Four per cent of Vancouver sales were registered to foreigners, but Mr. Kurland said those likely occurred in a select number of tony west side neighbourhoods.
"It would be useful, because this is a problem that should not be attacked by a mallet, but a surgeon's scalpel," he said. "The driver is at the high end of the property market."
Richmond and Burnaby saw the highest levels of foreign ownership in the region, at 11 per cent and 14 per cent respectively, but there is no indication of where that investment occurred, he said.
Mr. Kurland said the government's metric is not gauging the true level of foreign participation in the local housing market because it is classifying tens of thousands of wealthy "investor immigrants" from China as permanent residents despite earning all of their income abroad and, in some cases, continuing to live abroad while owning properties in B.C.
From 2002 to 2013, about 1,000 millionaire migrants flocked to Vancouver each year under a federal government program that was ultimately shut down after Mr. Kurland raised concerns over its effectiveness at generating local economic growth.
This net migration has made a large impact because when these families bought a home in B.C. another unit of housing was not relinquished into the market.
"With domestic people it's [often] a push: one bought, one sold," he said. "With an immigrant investor, it's one bought, none sold, and that's what restricts supply."
Tom Davidoff, a professor at the University of British Columbia and economist leading the charge for a targeted property tax, said the government should not "drag nationality" into the housing debate, but rather focus on whether people owning homes in this frothy market also earn their money in the region.
If not, then those owners should be charged a surtax for enjoying government services paid for through income tax, he said.
"When you're using something scarce you should pay the true cost," he said.