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This article by Thinkpol has spread very quickly across social networks for all of the wrong reasons. While accessibility into the housing market and affordability is clearly a major problem in Vancouver, “developer Onni is pre-selling the upcoming 1335 Howe condominium at a Hong Kong fair for prices “cheaper than if bought in Canada,” while boasting about pricing ordinary Canadians out of the housing market.”
You can’t make this stuff up, and the optics for locals are dismissive and appalling. A FaceBook page heralded “Every buyer who has successfully purchased the Onni project at a fair this weekend has a special discount, which is cheaper than buying in Canada. Many people in Hong Kong feel that the property market is not a product that can be bought by ordinary people, and that Canada, Vancouver or Toronto, has now become the preferred choice for many Hong Kong people”.
You can take a look at the internet listing for this new development here.  Onni has previously been accused of selling presale units overseas prior to any launch for local buyers. While there is now a foreign buyers’ tax , it does not apply to pre-built condo units, meaning that the units can be flipped prior to occupancy  without paying the foreign buyer’s tax.
Meanwhile in China the South China Morning Post  reports that five cities in China have implemented policies to reduce housing speculation and moderate a hot housing market. These measures include preventing the sale of apartments for up to three years, as well as restricting the number of properties one person can own. In one case any apartment  sale must be approved by the local Governmental Authority. Four of these cities are provincial capitals with populations of over six million people each. While there are solid administrative costs with policy focused upon prohibiting early sales, China is trying to cool the housing market and maintain affordability. Is it time for stronger measures in the Metro Vancouver market as well?
 
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Comments

  1. That’s just appalling. I was aghast when the NDP/Greens didn’t close the “Bob Rennie” loophole on taxing pre-sales in their budget. A shocking omission which will disenchant many who voted for them, especially when coupled with the Greens torpedoing the renters rebate.
    The city or province should have the power to ban foreign pre-sales.

    1. A gain on a pre-sales contract is taxable. Clearly not paying taxes is tax evasion. No new laws are required. Perhaps another registration is a good idea, and perhaps AG David Eby is working on it?
      The issue is tax enforcement. Didn’t CRA demand the presales list from one of the Gateway projects to set a precedent just recently? If taxes are evaded by a non-Canadian who is liable for the 25% of gross sale not withheld ? The buyer ? The lawyer ? The realtor ? Laws are in place today for sale of goods by/to foreigners. The main issue is lack of enforcement in Canada. Perhaps some people need to go to jail first before these practices stop.
      One needs to ask though WHY. Why is it easier to sell a project abroad than here? Why is it done? What laws are in place here that make it more difficult or costly to sell abroad?
      We ought NOT to limit foreign money, we ought to monetize it far FAR more. Canadians routinely buy properties in AZ, HI, CA or FL so why is it so unusual that Vancouver with a high concerntraion of Chinese and Hongkong immigrants and thus, relatives, friends and business connections back in China and Hongkong, wants to limit the sale of condos there ? We rather need to think of better ways to monetize that desire and we need to enforce existing laws better !

  2. Not suprised.
    If the developers keep getting away with this, then you’ll know who really runs this province.

  3. David Eby, the new AG, has quite a number of policy angles he’d like to enact on the affordability crisis. Give him a chance to get it right.
    Quashing the offshore presales tactic must be part of the package.
    One thing that needs to be considered when looking at blanket changes to RS zones to encourage removing the ‘missing’ from the Missing Middle is to discourage large land assemblies by big developers. Local small and medium-sized development firms will likely not go offshore with their marketing. I suspect there is abundant demand locally for rowhouses and low rises, and rental suites within both.
    At the same time transit needs to be improved.

  4. It would appear that you can make this stuff up. At least, that’s what Onni are saying the Hong Kong company were doing (and the offending Facebook page has apparently been taken down).
    “In a statement to Global News, Onni executive vice-president Chris Evans said, “the Onni group has no connection to Hong Win International’s marketing efforts, and did not authorize any of their sales promotions mentioned in regards to our Vancouver and Toronto properties currently being sold.
    “These statements are 100 per cent false and are not condoned by Onni in any way. We have been in contact with Hong Win International and they have ceased all of their marketing efforts and apologized for their error.”

    1. …. they have ceased all of their marketing efforts and apologized for their error.
      Note how they didn’t say whether they will or will not accept sale offers from offshore.

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