
Hundreds of luxury Vancouver mansions being rented for cheap - mji
https://www.ctvnews.ca/canada/why-are-hundreds-of-luxury-vancouver-mansions-being-rented-for-cheap-1.4329800#_gus&_gucid=&_gup=twitter&_gsc=av92XSY
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jandrese
Seems like the housing tax is working as intended.

The most interesting part is how this is one of the few serious sources of
backpressure on rent. Normally landlords are so loathe to reduce rents that
they'll let a property sit vacant for months, but this tax makes that
extremely painful so they're forced to instead meet the market on rent prices.

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electricslpnsld
> Normally landlords are so loathe to reduce rents

What's the reasoning here? I've tried to talk landlords down by less than a
month's rent when taken over the course of a typical year lease, been told to
shove off, only to watch the unit go unrented for months until they finally
drop the price.

~~~
tinco
Something I've heard a landlord argue was that if he lowered his rent that
would mean his property value would go down which would mean his
loans/mortgages would not be covered. He would rather take a couple months of
losses than devalueing his property.

I have no idea if the math works out for that, and he was negotiating, but he
didn't budge a cent and we took our business elsewhere so it did seem like his
hands were tied the same as your example.

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anitil
I have heard similar arguments from developers in Sydney. They will give you a
car, or guaranteed rental income for x months, rather than dropping the price
of the property.

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WestCoastJustin
I have been following
[https://twitter.com/mortimer_1](https://twitter.com/mortimer_1) for a bit. He
paints a pretty crazy picture with data of what is happening in the Vancouver
housing market. People asking millions over assessed value, people selling at
massive losses, and mansions renting for pretty cheap.

An example: Bought 2013 $2,275,000 now asking $6,888,000, Bought 2016
$5,200,000 now asking $4,888,888, Bought 2016 $3,590,000 and sold for
$3,250,000, etc.

~~~
goatsi
[https://twitter.com/vanreflipflops](https://twitter.com/vanreflipflops) is
also great for this.

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ddebernardy
Related: "What can/do governments do to address house prices being driven up
by foreign investors?" on the Politics StackExchange:

[https://politics.stackexchange.com/q/24073/15531](https://politics.stackexchange.com/q/24073/15531)

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baybal2
I once rented a $1.6m mansion apartment in Shenzhen for $500 a month. I guess,
Chinese influence...

For some locals, the math behind earning money from property in other ways
than resale don't tell them anything. They got too used to the idea of
flipping properties at six digit gain every few years.

Naturally, the "measly income" from rent doesn't look much in comparison to
that to simply bother thinking about.

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lainga
Do you mean "Chinese influence" like you got the apartment because of guanxi?
Or like the situation in Vancouver now is influenced by what you saw in
Shenzhen?

~~~
baybal2
The second one, and not only Shenzhen, but all of big cities in China.

I often went into long discourses with recent immigrants about that. Their
idea of how market work is long pass the level of sane, and rational.

I keep telling them about "investing into a bubble is dumb thing to do" only
to be greeted back by some bizarre "economic conspiracy theory."

Most do that on advises of some "esteemed economic gurus" from China.

That looks silly, but only until you you begin to think just how many
thousands of multimillion buck properties were bought thanks to such "gurus"

~~~
charlesdm
Investing in a bubble can be great, as long as you're early enough and not the
one holding the bag a† the end.

It's one of the quickest and easiest ways to make money, actually. I wouldn't
always call investing into a bubble foolish.

~~~
echlebek
If you do well investing into a bubble, it just means you were a lesser fool,
rather than the greater one that holds the investment when the bubble pops.

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refurb
I’m sure the fact the Vancouver housing market is rolling over helps in
addition to the occupancy tax.

Vancouver sfh prices are down 20% from peak and even more at the top end
homes.

In the past you could take the hit from leaving it empty when you were seeing
$100-200k appreciation per year.

Not any more!

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msie
I have a question though. The pictures with the article list the rentals as
$1000/room not $1000 for the entire house and the article says that many
owners do not want to rent to groups. So this is useless to the single renter.
I don't know how the housing activist got his 800 results.

~~~
mattnewport
I believe what they're saying is that they don't want to rent to you and a
bunch of your friends as a group but as an individual you can rent a room and
you will be sharing the house with other individuals to whom they rent
individual rooms. I'd guess this is because they don't want a big group of
students renting the place together and turning it into a frat house.

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aufumy
There was a ton of anti-Chinese bashing because they were seen as being the
cause of empty homes, and this issue was linked to the housing crisis in
Vancouver. But looking at the examples of empty homes, I doubt that the South
Surrey place for example was owned by a Chinese owner. It would be interesting
to see statistics.

Also, a few hundred or even thousand homes rented to non-groups is hardly
going to ease the tight vacancy rate in Vancouver. The housing issue has more
to do to poor urban planning.

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paddy_m
This sounds close to a land value tax. If you look around most US cities you
will see a lot of land not being used for housing as compared to European
cities. Land used for parking, lawns, roads, and vertical space not filled
with bedrooms all contribute to higher rents. True, there are zoning laws that
restrict these housing uses, but there is also no encouragement from the tax
code. Land value taxes encourage more efficient use of valuable space.

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crushcrashcrush
We need to tax foreign-owned, non-owner-occupied properties in the San
Francisco Bay Area. Some sort of scale:

Foreign Owned, Non-Owner Occupied - 10% Per Year of Assessed Value

Foreign Owned, Non-Occupied - 25% Per Year

Foreign Owned, Owner Occupied - 0% Per year

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paxys
Or, you know, start taxing all properties based on fair market value.

~~~
ericd
True, phasing out prop 13 would help a lot.

~~~
crushcrashcrush
Agreed! Prop 13 needs to die.

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StreamBright
Title should be anti-speculator legistlation has intended side effects.

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Deimorz
It's extremely common for "too good to be true" listings like this on
Craigslist to be scams, where if you inquire they'll try to get you to wire
money for the rental. The person behind the listing doesn't have any
connection to the property, they take the photos/info from legitimate listings
on other sites (often real estate listings, not rentals at all).

I'm sure it's possible that some of these listings are legitimate, but finding
a bunch of listings on Craigslist isn't proof of anything and I think it's
strange to base a story on it.

~~~
giarc
They have an interview with a person that actually moved into a unit, so that
helps. Scams can easily be thwarted by asking to see the place in person.

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forkLding
Anyone have a list of these mansions that are being rented, google searching
isn't showing anything?

Sounds like a place to go for the summer now.

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BadassFractal
> The city of Vancouver is facing a crisis in housing affordability, with one
> bedroom units averaging about $1,730 per month.

I'll take that any day over SF. That's a crisis I can sign up for.

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Mikeb85
Yeah but salaries are far lower than SF.

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phil248
Who cares about a bigger salary if most of the difference gets directly
deposited in your landlord's bank account?

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derefr
Having 1/3rd of $100k is more spending money than having 1/3rd of $50k. Prices
for things that _aren 't_ rent, don't change by market. You can buy more
smartphones, donate more money to charity, whatever you want.

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lostmsu
> a single room in a multi-bedroom house for anywhere between $700 and $1,500

And that's called cheap?

This article is a clickbait ad, IMHO.

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nullterminator
For Vancouver? Yes, that's cheap. You may only get one bedroom, but you also
have shared access to the rest of the luxury mansion. It's not $1500 for one
room.

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grawprog
I wonder if it has to do.with the new speculator tax in BC for empty homes?
Tax season's here. Seems like they're trying to avoid the fairly hefty new tax
that would be levied on them for having an empty mansion.

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codingdave
The end of the article confirms exactly that point.

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grawprog
Yeah...it's pointless though. As soon as they're able to they'll raise the
rent or kick them out. That's how shit works here.

