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Vancouver Housing Bubble: Why Chinese Investors Will Return

ashley nielsen real estate - chinese investors in vancouver no housing bubble


Bloomberg recently published a chart highlighting the relationship between Vancouver real estate and China's economy, suggesting that what happens in China has as much influence on the city's housing market as Canada's own economic policies.

Bloomberg pointed out that China's gross domestic product expanded by an annual rate of 7.9 per cent in the fourth quarter of 2012 — up from 7.4 per cent in the prior quarter and the economy's first acceleration in two years.

Their graph established a direct correlation between China's GDP and Vancouver's housing prices — as China's GDP rose, so did Vancouver's real estate prices. If the trend holds, Bloomberg predicts, Vancouver's real estate prices should also soon rise.

Correlation isn't causation — and Vancouver's real estate market is certainly complex — but the Bloomberg research supports my prediction that Chinese buyers will be back to Vancouver real estate sooner rather than later.

Some background: Over the past year, mainland Chinese investor buyers all but disappeared from Vancouver's real estate marketplace, contributing to what was already a softening market in metro Vancouver.

But why did Chinese investors disappear in the first place? During the first decade of the new millennium, real estate prices in China were astronomic — even more expensive than Vancouver. In 2009, China introduced a policy designed to cool investor speculation in real estate. This policy, which was meant to help ordinary citizens buy their own home, stipulated that buyers could purchase their first home with 30 per cent cash down, but if they bought a second property, a whopping 60 per cent down payment is required. As a result of the policy, prices in major cities such as Beijing dropped by 30 to 40 per cent, effectively halting the investor market in the country.

What the policy did was greatly reduce the amount of cash investors had to invest in real estate, both in China and overseas.

Typically, Chinese New Year is when Chinese investors visit Vancouver and go on a shopping spree, but last year, Vancouver real-estate developers and marketers noticed the absence of the mainland Chinese buyer, a telltale sign that China's policy was working and that the overall economy was slowing down.

Here's why I think Chinese investors will return. In China, the real-estate industry accounts for 11 per cent of the country's overall GDP. Including related industries like appliances and furniture, you're looking at a hefty 22 to 25 per cent of the country's GDP. The People's Republic of China simply cannot afford to have this important industry stall, which is why I believe that the Chinese government will relax the restrictive lending policies, investors will start getting back into the market and, as their assets become more liquid, we'll see them return to Vancouver.

The brisk return of China's real-estate market means many Chinese will once again look for a safe haven to park their newly regained wealth.

While China's policy change has impacted investors' cash flow in the short term, it hasn't curbed their enthusiasm for Vancouver real estate. The sudden rise and fall in real estate prices that we're seeing now in China, as well as fluctuations in the overall economy, mean that people view investing there as no less risky than placing bets on a baccarat table. For many Chinese investors, parking money in Vancouver feels as safe as investing in treasury bills.

The People's Republic of China has a new leader in Xi Jinping and historically every change in leadership brings with it new policies to create its own legacy. I believe that with this leadership change, we will see major changes in the country's mortgage-lending policies and a renewed interest in real estate investing.

Experts predict that Vancouver's real estate market in 2013 will decline slightly, not crash. And with the likely return of the Chinese investor and the news that the Bank of Canada will hold the interest rate at one per cent, the future of Vancouver's real estate may not be as bad as what the headlines would have you believe.

Lin, Will. "Will Lin: Vancouver Housing Bubble: Why Chinese Investors Will Return." The Full. The Huffport British Columbia Canada, 25 Jan. 2013. Web. 25 Jan. 2013.

Vancouver Housing Bubble: Why Chinese Investors Will Return Ashley Nielsen - Prudential Realty - Vancouver Real Estate -


彭博社指出,中国的国内生产按年率计算为7.9%,在2012年第四季度 - 扩大7.4%,而前一季度和经济的加速在两年内。

他们的图建立了中国的国内生产总值和温哥华的房价 - 有直接的关系,中国的国内生产总值增长,所以做了温哥华的房地产价格。如果这一趋势认为,彭博预测,温哥华的房地产价格也应该很快上升。

关联不是因果关系 - 温哥华的房地产市场肯定是复杂的 - 但彭博社的研究也支持了我的预测,中国买家将回到温哥华房地产宜早不宜迟。


但是,为什么中国的投资者在首位消失吗?在新千年的第一个十年,中国的房地产价格在天文 - 比温哥华更昂贵。 2009年,中国出台了政策,旨在冷却投资者房地产投机。 ,这是为了帮助普通市民买自己的家,这一政策规定,购房者可以购买他们的第一家,下降30%的现金,但如果他们买了第二个属性,高达60%的首付要求。作为政策的结果,在主要城市如北京,价格下降了30%至40%,有效地停止在该国的投资市场。








林。 “林:温哥华房地产泡沫:为什么中国投资者将返回”。完整的。