The Vancouver housing market is teetering

More regulations are needed before the whole thing collapses

Many people will tell you the housing market in Vancouver is a house of cards, but realistically a Jenga tower is a more apt comparison. People are not only adding to the problem, they’re compromising the structure as they do it.

Housing prices in the city are not a surprise in themselves, but a new initiative by the B.C. Ministry of Finance, looking at disclosing non-citizen investments in the housing market, might have the answer to why housing prices in Vancouver increase more rapidly than any other city in Canada.

Many people are quick to blame foreign investors buying up properties, but few condemn Vancouver-based real estate firms for conducting such housing transactions. In addition, they rarely collect or disseminate this information to Canada’s anti-money laundering agency, the Financial Transactions and Reports Analysis Centre (FinTRAC).

The percentage of foreign home-ownership in Vancouver is a figure yet to be calculated. Provincial auditors will have to look more closely at real-estate transactions in the future, specifically to address disclosure information on the citizenship of those looking to buy or sell. Luckily, the Minister of Finance’s office has said that they plan on doing just that.

Another important regulation will be the collection of information from real estate firms on the types of contracts that are successful. With contract assignments such as “dark flipping” not being out of the ordinary, new regulations hope not to deter licensed realtors from such practices, but to monitor and help sellers become aware of consent in such matter, and ultimately to make the most possible profit out of their investments.

For now at least it seems the rising housing market prices question is far from answerable, at least until further information becomes available from these forthcoming regulations. Until then, remember the wisdom of Lex Luthor: “You can print money, manufacture diamonds, and people are a dime a dozen—but they’ll always need land. It’s the one thing they’re not making any more of.”