10 terms to make sense of Vancouver's wild real estate market
Snow washing to shadow flipping — here’s what it all means
Vancouver's housing crisis and real estate market are rarely out of the headlines.
As politicians look for solutions amid a seemingly endless parade of stories of everyone from families to artists being squeezed out, and court cases surface revealing the underbelly of the market, here's a list of terms to help make sense of it all:
- Snow washing: Think money laundering in a safe, respectable country like Canada. Essentially, snow washing is when international businesses hide illegitimate financial transactions in Canada, often for the purposes of tax evasion.
- Fuerdai: A Chinese term that refers to rich second generation children. It's essentially new money as the parents have often earned their wealth within their lifetime.
- Bare trust: Corporations and wealthy individuals hold properties in bare trusts so they can avoid paying property transfer taxes.
- Ghost immigrant: A person who secures permanent residency, purchases property in Canada and then returns to their home country.
- Shadow flipping: In the past, some Realtors abused a clause in real estate contracts, known as an assignment clause, that allowed their clients to transfer the purchase of a property to another buyer, pocketing multiple commissions along the way. The B.C. government put an end to the practice in March of 2016..
- Affordable housing: The holy grail that's nebulous in dollar amounts. The rental incentive guidelines the city has defined for for-profit affordable rental housing put it between $1,730 and $1,903 for a one-bedroom rental or between $3,365 and $3,702 for a three-bedroom unit.
- Renovictions: Evicting tenants under the guise of doing renovations in order to increase the rent.
- Speculation tax: A provincewide tax introduced in the 2018 budget that targets secondary homes that are not occupied. Some areas, like Bowen Island and Squamish, are exempt.
- Foreign buyer ban: A proposal by the B.C. Green Party earlier this year to copy countries like New Zealand and only allow permanent residents to buy property. Premier John Horgan rejected the idea.
- School tax: A levy — intended to pay for school seismic upgrades — that would increase property tax by 0.2 per cent on homes valued between $3 and $4 million and 0.4 per cent on the value above $4 million.
With files from SOLD!, a CBC Vancouver original podcast that digs into Metro Vancouver's real estate scene.