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Comment by yummyfajitas | Hacker News Reader

People make similar claims about NYC, Mumbai, etc. The numbers just don't add up. There aren't that many rich Chinese people.

In any case, suppose you are right. Why not keep building homes and selling them to those dirty chinamen? They want to throw money at Canada, why not take as much of it as possible?

Oh right, exclusionary zoning. Which I'm sure is also somehow the fault of evil foreign scapegoats rather than nice white middle class Canadians.

Maybe you guys should build a wall, and make the Chinese pay for it. Make Canada Great Again!

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There are lot of rich Chinese people. A friend of mine in a Vancouver suburb sold their place three months ago to a buyer from China who paid cash and who left the house empty. That's a fact. Another story I heard which may or may not be fact :) but I tend to trust is that someone came in to a local insurance office to insure 30 houses they owned. Houses in the Vancouver suburb I live in went from about 700K to 1.4M in two years in direct correlation with the arrival of foreign buyers. Some of those actually do live in those houses but a lot of houses are left empty.

China owns $1.25 trillion of US debt. I think this gives a window into the amount of money sitting there. That's a million $1M houses. Vancouver has 47K houses...

> There aren't that many rich Chinese people.

China has 1M+ millionaires. Assume 10% have enough disposable cash and motivation to go shopping for foreign real estate. It doesn't take much effort to look across the Pacific and home in on the politically easiest place to escape to. If 10% of those people choose Vancouver that's 10K units locked away from local residents.

So how come housing prices have been skyrocketing in most global cities as well? You seem to want to blame Vancouver's problem on foreign scapegoats, but Vancouver's problem is hardly unique.

If all these evil Chinese folks are going primarily to Vancouver, what's the cause of SF, NYC, Boston, Mumbai, Delhi, Bangalore and London's high housing prices?

And why is Houston somehow immune to this global phenomenon?

The total housing inventory available in all these cities is just not high enough to satisfy the demand of investors. It seems there are certain cities that attract attention while others do not. Seems to be about where the marketing effort is and what the screening criteria is on the buyer side.

This is nothing to do with evil. It's just business/common sense. If I had a lot of money and I was living in China where there's a large risk and I was looking to make a similar investment I'd probably go the same route. A lot of wealth was created in a short time and those wealthy people like any normal person are concerned about preservation of that capital and some sort of safety net.

The total housing inventory available in all these cities is just not high enough to satisfy the demand of investors.

But why is the inventory not high enough? Certainly we could easily build more.

Oh yeah, exclusionary zoning in NYC and SF. FAR limits of 1.33 in Mumbai. Mumbai and Delhi have half the density of Brooklyn, Vancouver about a third - there's plenty of room for more inventory. Even in Manhattan we could fit a lot more inventory in.

We don't do this because the middle class don't want it.

Yeah, it's like regulatory capture. The owners in the cities want to keep what they have, and vote for it. I'm sure some of it has to to with propping up house prices, but I don't think all of it does either! It's an interesting problem when it comes into conflict with a city's growth.

It's mostly single family homes that investors are after in Vancouver and that have appreciated the most in value. Vancouver is landlocked between mountains, sea, and river. You can't build many more single family homes in Vancouver. I imagine with most other cities building more would be either more sprawl or more density both of which can create problems.

Canada isn't densely populated so why should the Vancouver people need to squeeze into apartments while houses are sitting empty? So you're right. The middle class doesn't want it.

It's true that not everyone can have the "American Dream" house/garage/car any more but at the same time having a bunch of expensive houses sit empty is worse than them having someone live in them.

I think part of the solution might be building new cities, something that doesn't seem to be happening.

Boston does not have enough affordable housing. There is a ton of building in the city, but most of is it high end housing and very expensive towers/hotels. Good luck finding a freestanding house for under $800K.

When the market prices are high, and land is expensive, and you have the slow zoning/permitting process of Boston, developers are going to only build luxury housing, until the city changes the permitting/zoning process and requires them to build more affordable housing units.

See this detailed article [1]

[1] http://www.bostonmagazine.com/property/article/2016/02/21/bo...

Chinese buyers are not restricting themselves to Vancouver....

There are also a good number of wealthy Russians and Middle Easterners paying cash in the cities listed. If you've followed NY or London real estate news for the past decade, you would know that what's happening in Vancouver has been happening in other cities as well.

> "And why is Houston somehow immune to this global phenomenon?"

"We don't like yer kind 'round here."

60% Chinese rich people plan to buy house overseas, US most preferred - "About 1.34 million Chinese people who own at least 1.5 million USD took the survey from August to October, 2016." - http://usa.chinadaily.com.cn/china/2016-11/09/content_273251...

Vancouver has a lot of for sale signs in front of houses that are entirely in Chinese.

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