Fintrac Fails by Justin MacKinnon

So, Christy Clarke is enforcing new guidelines and regulations to avoid shadow flipping.  That is a good start Mrs. Premier, but there is a long way to go.  I feel like the major issue is not being addressed here.  Sure, a good number of agents have been taking advantage of the red hot market via certain loopholes(aka Shadow-flipping), but that is just one head on this Hydra.  The main problem with our current market is oversea money that is flooding the province and not being checked.  The last absurd heading I read was Vancouver home sold for 1 million dollars over asking price.  Sounds great if you're a seller, but local buyers are going on year-long hunts for a home and keep getting outbid, and outbid by FAR.  What is the problem?  Well, a lot of this money is coming from China and a lot of the money coming from there is most likely needing to be laundered.  I'd like to point out that nothing is wrong with Chinese money being invested in Canada, as long as that money is legitimate.  New evidence suggests that dozens of Metro Vancouver real estate firms are failing to adhere to anti-money laundering laws.  So, it starts with the brokerages.  If they are not enforcing regulation, that's the first big failure in trying to solve our problems.  Greed from the top, down is the problem.  The short-sightedness of these neglectful brokerages allowing agents to strike while the irons hot are ruining it for the rest of us who are plagued with a conscience and business ethics.  All agents and brokerages are inheriting a bad name from those that can't temper their appetites.  I am glad that I am involved with an office with the strictest of requirements. 

If we can filter out these types of purchasers, the market will calm down.  If we build a bit more, the market will calm down.  I see the market correcting itself if the provincial and federal government can stifle all of this money-parking.  Anyone from anywhere is welcome to invest in Canada as long as Canada can also benefit(for the long term).  If you'd like to purchase a home in Canada, then perhaps you have to live in that home and pay taxes, or don't live in that home and pay heavier taxes or be forced to rent said home out.  If the government is afraid to squelch foreign investment in fear of a major economic hit, are they not realizing the future is being mortgaged?  I hope that the future we envision with no blue-collar and hospitality workers being able to afford to live in Vancouver never comes true.

Recent new rules are encouraging in that:

A)  If you are on title and are claiming to be owner/occupier, you should be OCCUPYING that house for most of the year(not just your spouse or children).

B)  Stricter employment and citizenship documentation required.  Some Fintrac forms state "teacher" or "home-maker" for 3-4 million dollar transactions.  Sign me up for that teaching gig please.

C)  Higher taxation, luxury type homes are getting a higher property transfer tax while more affordable homes will not. 

D)  Vacant home taxation.**This idea has been tossed around, but not put through.  A block teeming with empty homes with structural deterioration, an over-flowing mailbox and horribly neglected landscaping can ruin a neighborhood esthetically.

 

Stricter enforcement by government, and furthermore brokerages will be the beginning to the solution that is plaguing Vancouver.  Only time will tell if this freight train will slow down to a reasonable speed.  Let's all hope for the best...

 

 

 

Justin Mackinnon

Justin Mackinnon

REALTORĀ®
CENTURY 21 In Town Realty
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