MLA David Eby is calling on the provincial and federal governments to crack down on international buyers who have little or no income, yet are able to get substantial mortgages to buy and flip local properties.
His research found that "students" in Point Grey owned nine properties with a combined worth of $57.1 million, and that seventy per cent of these properties by value were supported by mortgages issued by some of Canada’s major banks.
Upon closer inspection of one of the properties, Eby and his team found that one of the "students" had bought the property for $7.1 million, before flipping it for a cool $8.35 million, netting more than $1 million.
Though this particular transaction was not financed by a mortgage, Eby says that bank policy of lending vast sums of money to individuals with no apparent source of income should be raise for concern, especially considering that Canadians have to jump through many hoops to qualify for a mortgage.
Eby's claim was supported by an investigation into Canadian real estate practices by The Globe and Mail that revealed banks use a different set of loan requirements for foreigners than they do for those who work and pay taxes in this country.
“It’s absolutely outrageous that a Canadian who’s working, living and paying taxes in British Columbia has to provide even more information and cross even more hurdles than somebody who is not a British Columbia resident and isn’t paying taxes and living here,” says Eby.
Eby's question, "Is Canadian banking policy enabling foreign students to flip houses in Point Grey?"