Ghosts of B.C. real estate scandal still linger

Appeared in the North Shore News – December 2, 2016

Premier Christy Clark of Banana Columbia – no misprint – is cruisin’ for a bruisin’ in May’s election if she doesn’t straighten up and fly right dealing with the multi-layered housing scandal.

Enough of the 1940s slang. If New Democrat leader John Horgan plays his election cards skillfully – not easy, since the NDP’s ideological high priests are even more frightened of offending than the Liberals – he has the stick if he’s bold enough to use it: A call for an inquiry into the scandal in offshore real estate deals, concentrated in Vancouver and Toronto.

The scandal includes money laundering, funny business with figures, jiggery-pokery about true ownership, fast flipping that cheated sellers and buyers alike, lies and deceit, tax evasion, loophole exploitation.

Its victims? Many young Canadians – and the homeless old – paying swollen rents and with little hope of owning a family home, or forcing them to take desperate risks that could leave them twisting in the wind if interest rates rise a couple of percentage points. That happened to marginal owners in the U.S. housing crisis of 2007-’08.

Its perpetrators and the complicit? Realtors and their fox-guarding-the-henhouse self-regulators. Developers. Bankers. Lawyers. Few, one hopes.

They were facilitators for mostly fabulously rich Chinese wheeler-dealers – a fact the Clark government dodged, implying that such claims, obvious to anyone conscious and upright who knew what was happening on their own street, as xenophobic. Clark remained in denial until further dodging was impossible and action arguably too late. The ghosts may have vanished.

Above all – and this is why corruption may well be the right word: Canada’s politicians and regulators had the incriminating data at hand. But political action on them would have spoiled the obscene real estate party of the last few years.

Douglas Todd, once and occasionally still the Vancouver Sun’s religion columnist – he recently wrote revealingly about composer Leonard Cohen’s beliefs – has joined other Sun stars as essential reading. His prose is calm, measured, even oddly non-judgmental, unlike some crazy old coot columnists I could name.

In a recent column Todd cites heroes: Lawyer Christine Duhaime, who claims bankers and realtors withheld information, impeding investigations; SFU Prof. Jonathan Kesselman, who offered solutions; UBC Prof. David Ley, flailing “silences”; Justin Fung of Housing Action for Local Taxpayers, who said: “Foreign money coming in clearly benefits the property developers who are major contributors to the B.C. Liberal party.”

Todd alleges those who failed their public trust include Immigration Canada, the Canada Revenue Agency, and Fintrac, which tracks money laundering. They didn’t fully use the tools they had. He concludes: “In fact, unenforced laws are worse than none at all. They give voters the illusion of protection when there is none.’’ The offshore ghosts, all too few punished all too lightly, may have already vanished.

And here’s election trouble for the Liberals: Prospective future leaders Rich Coleman and Mike de Jong were loyal backers of boss Clark’s laissez-faire stance of letting the unfettered market decide. That equates capitalism with crookedness, crime, exploitation – just business as usual. Marx would beam. Banana republics would rejoice: “Toothless police! Just like us!’’

And nothing holier-than-thou here: I am passively complicit in Vancouver’s moral real estate sewer. I’m a card-carrying capitalist and a beneficiary of Vancouver’s bloated real estate prices.

Canadians’ fear of offending electorally powerful “communities,” and economic and political cowardice, stifled frank debate. Blowhard billionaire Donald Trump is a highly unlikely champion of dispossessed Americans, but they may have a surer grasp of how our society really works than public intellectuals, shocked Hillary Clinton camp-followers, and media toadies.

What Trump said in the campaign may prove blather. Real people are the issue – ignored, not stupid, mostly skilled, humiliatingly under-employed, and angry. They backed him.

• • •

Selective historical memory: Haven’t encountered a word about the Cold War’s scariest days – the 1962 Cuban missile crisis, Soviet warheads aimed at the U.S. That doesn’t fit today’s lipsticked narrative of Fidel Castro and the Trudeaus, father and son.

• • •

My suspicious mind. The box in this paper for “party affiliation” under West Vancouver council candidate Peter Lambur was blank. Why?

Safely elected Lambur responded: “As I recall it was left blank because I honestly couldn’t remember if I was a current card-carrying member of any party. … In past years I have been a member of the Liberal party, but a follow-up look through my current membership cards comes up empty, so it’s safe to reply ‘nil’ or ‘none’ at the moment.”

© Trevor Lautens, 2016

Self interest fuels real estate Wild West

Appeared in the North Shore News – February 12, 2016

Who didn’t know that Vancouver real estate prices are outrageous – even possibly inciting future civil violence by young generations shut out of ever owning a home in the city of their birth?

What’s new – what’s news, thanks to a print reporter who proved what everyone should know, that if you aren’t reading newspapers you’re badly under-informed or misinformed – is that persons of shabby ethics are legally but odiously taking middlemen profits from unknowing home sellers while arguably gouging the ultimate buyers.

The device is being dubbed “shadow flipping,” and it’s threatening to tar the whole real estate  industry thicker than the stuff needed to repave West Van’s lumpy 1500-block Marine Drive (try that for reviving Ambleside, Mayor Michael Smith).

And yes, many named in Globe and Mail reporter Kathy Tomlinson’s outstanding investigation into this unpleasant practice of flipping properties are ethnic Chinese, leaving owners selling for less than they might have got, and buyers – many themselves offshore Chinese – paying more than they might have paid.

The middlemen make up to seven-figure profits between the time the owner sells and when the deal legally closes. Sometimes that’s months later.

Unless the seller is alert to his or her interests, and to the fine print in a sales agreement allowing such a process, in this grey period the property can be “assigned” – flatly, flipped to someone else, who in turn can flip it further up the food chain.

For example, Tomlinson cites a case before the courts wherein the West Vancouver plaintiff claims a scheme was concocted by a real estate agent and a buyer to purchase his home for $5 million. It ultimately sold for $7 million. Middlemen allegedly shared the $2 million difference.

Apparently, that’s legal. Offensive to many, perhaps, but legal. Where the regulators can, and should, jump in is into the loophole, because the flippers, not being the actual final buyers in such cases, are suspected of reaping their profits without paying the capital gain or provincial property transfer tax (PTT) that lesser mortals (very sourly) pay.

The Liberal government handed the issue on a silver platter to the NDP. Following Tomlinson’s story, New Democrat David Eby raised the suspicion of PTT avoidance and possible insider trading and money laundering. Christy Clark, abetted by cabinet minister Peter Fassbender, who seems even more laissez-faire than the premier about Vancouver’s (dangerous, I fear) real estate bubble, has rejected interfering with the market by imposing restraints on offshore property purchases.

And to be fair – my greatest fault – Clark makes a sobering point not missed by West Vancouver’s millionaire property owners, which means every one of us: Discouragement of offshore or home-grown buyers, including speculators who buy houses and leave them empty (or faux-occupied)  in expectation of higher prices, would lower existing owners’ property values. Gulp. Who said self-interest and greed should be monopolized by any one group?

I asked Jason Soprovich, a top West Van Realtor, for his view. Which was: “Oh, shadow flipping, yeah. It’s not good for the industry. It’s unfair on so many levels.” As in any industry, “there are always a few tainted apples – it’s limited to a few tainted apples.”

Another long-time West Van Realtor of integrity whom I dealt with years ago politely declined to comment: “Our company has a policy that only regional management can make public statements on behalf of our company.”

Tomlinson quoted Vancouver real estate agent Allyson Brooke of Macdonald Realty: “There is a lot of speculation in this market – but lack of government intervention is as responsible as the speculators themselves.”

Obvious question: How come a newspaper reporter could winnow through hundreds of records to discover what bureaucrats must have known about – and will now likely snap out of their doze to do something, or seen to be doing something, about?

Well, um, maybe because that might jeopardize Vancouver’s standing as the third priciest real estate on the globe – and also a great many interests with dollar signs attached. Go back to Premier Clark’s candour. Do I want my real estate values to crest and then drop, joining my stocks and savings accounts in their calamitous swoon? I refuse to answer on the grounds that I’d have to tell the truth.

David Marley, a relentless West Van political scold, emails: “Don’t count on the Real Estate Council of B.C. to do what is necessary. It seems they’ve been aware of the unethical behaviour by some of their members for quite a period of time now and, instead of immediately revoking licences as should be done, have merely been giving those brokers who have been caught abusing their position of trust short-term ‘time-outs’ as though they were naughty children. A little respite to count their ill-gotten gains.”

© Trevor Lautens, 2016

B-line to Armageddon if No prevails?

Appeared in the North Shore News – May 22, 2015

The $7.5-billion transit plebiscite coffin should have so many nails in it that it may require a second coffin.

There’s a note of desperation in the Yessirs’ plea-cum-threat to Metro Vancouverites to lend approval to the 10-year plan, funded by a half-percentage-point lift in the provincial sales tax. (Temporary? Permanent? Who knows?)

Vote Yes, or — Armageddon. Babies, moist at both ends, and their weeping mothers stranded in the rain, packed buses stonily sweeping past them.

Cynical manipulators with thick Langley accents evilly chuckling that they’ve foiled Vancouver Island pro-Yessir sages. UBC students going mad in bulging B-line buses, mobile Black Holes of Calcutta.

Vancouver Sun columnist Barbara Yaffe is, at this writing, the latest to spoil the well-heeled Yessirs’ party. What, she asks, is the Yessirs’ source of money?

Bafflegab reply: Metro mayors’ council had agreed to spend up to $6 million on “the education component to promote the benefits of mayors’ plan for regional transportation.” (Those ads plastered on bus sides, pro-Yes radio plugs and mass phone calls, are educational?) Translation:

Taxpayers ultimately are paying. Further questions “will be considered” — not necessarily answered, note — when “the campaign period is complete.” Until then, peasants, just zip your lips and tug your forelocks.

As of a couple of weeks ago the Nossirs had raised a starveling $30,000. Jordan Bateman calculates the Yessirs are outspending his ragged band 200-1, something like the Team Canada score against Volcanovia at the second-period intermission.

• • •

Vancouver Sun columnist Malcolm Parry’s nostalgia gland was squeezed by my recent utopian bus fantasies, especially the “club car” proposal.

Mac recalled travel with chums on the train from work in Birmingham to his Walsall home. Heady days. Possibly not clear-headed. A teetotal pal who worked at the Aston brewery would ascend, bearing two flagons of his daily free-beer allowance. This enlivened the group’s card games.

“I often won enough in the games to buy 10 Senior Service cigarettes at journey’s end,” Mac recalled. “Given that, the free beer, and the low cost of a day-return railway ticket, I was, as the British say, ‘quid’s in.’ ”

Memories aside, Mac also sent a CNN story proving great minds think alike: In March San Francisco began a luxury bus service that has resemblances to my ideal bus.

Running between the wealthy Marina district and downtown, the buses have leather and reclaimed wood appointments; LED and Wi-Fi and mobile device outlets; an app offering pre-boarding orders for food and drink (sadly, non-alcoholic). An attendant serves drinks, adjusts the temperature, and chooses the music.

Normal bus fare is $2.25. Headline: “Would you pay $6 to commute in a bus that looks like a cafe crossed with a Virgin America plane?”

Certainly. See, grey-souled TransLink, my proposals aren’t bizarre — they’re sensible. Think!

• • •

The North Shore Zone Festival of Plays is a happy, friendly week, requiring some stamina: An ice-breaker party Sunday, followed by six nights of plays. I made four, sending trusted agents to the other two. Beats the Stanley Cup playoffs without the Canucks.

The winner, off to its own playoffs in July in Kamloops: Rabbit Hole, with Peter Zednick picking up best director. Tightly written. Excellent cast. Gripping. Confession: I left at intermission. I didn’t care to watch a couple’s marriage unravelling, unable to handle the grief of their four-year-old son’s death. Call me sissy. Call me jaded. I know enough about life’s wounds.

Shallowly, you may say, I want entertainment, a few jolly laughs. And I anticipated the ending — a life-affirming birth of the spinny unmarried sister’s child. Was I right?

Short notes: Sue Sparlin — who didn’t begin acting until age 60 — would make a fine Madame Arcati if someone, please, would stage Noel Coward’s Blythe Spirit. Nigel Vonas was a festival standout in an unpleasant play. And Kieyella Thornton-Trump, 10, won hearts in W.A. Troyer’s Grandpa ’n’ Me.

• • •

Still more stage: Roger Nelson is as durable as the Gilbert & Sullivan operettas, which this area’s oldest theatre company, North Shore Light Opera Society, has performed for 67 years. This year Nelson is staging H.M.S. Pinafore.

• • •

West Vancouver is the Flip City of real estate, its prices maddest in the mad Vancouver area — which is yoked with London and Manhattan for the priciest property on the planet.

Last Saturday’s Sun — anyone who doesn’t read at least one Vancouver daily is badly under-informed — listed 23 West Van flipped property prices that would knock your proverbial socks off. Example: 910 Braeside St., sold April 7 for $2,098,000, listed six days later for half a million higher.

The champ: A bare lot at 1424 Sandhurst Place, sold a year ago for $3.7 million, listed last month for $6.18 million. (In April a typical detached West Van home sold for $2.23 million.)

I first reacted with shoulda/woulda/coulda: Why hadn’t I got in on this feeding frenzy?

Confession: Because at heart I believe there’s something indecent about treating a house — with its unrecorded history of families, of birth and growth and death, of talk and laughter, of murmured love and bitter quarrel, of secrets kept by its discreet walls — as just another commodity to be flipped up the financial food chain, like barrels of oil or railway stock.

That’s the kind of chump I am.

© Trevor Lautens, 2015

Rule 1: Never sell. Rule 2: See rule 1

Appeared in the North Shore News – February 27, 2015

Self-interest (aka money) rules. The real estate industry expertly knows how to twist the monster home issue: Divide the neighbours.

There’s no end of chat about prospective monster home property buyers. Almost none about the other side of the deal: the sellers. It takes two to tango.

These are the owners who, if enough money is waved at them, will sell. And if their neighbours are furious about the prospect of something bulky enough to look like a hotel, as a reader described one house now under construction in West Vancouver’s Dundarave, well, too bad — the seller is leaving the neighbourhood, well-heeled and conscience-clear.

Equally obvious: there’s migration from one side to the other. One of my most reliable agents, 7yc44D, recalled a contented long-time resident with no intention of selling — until offered $14 million for his property. He sold.

A recent media item reported on a homeowner who considers the sale of his WV property as his pension plan. The fear of running out of money before running out of years grips the old especially.

I’ve mused about making real money writing a real estate advice book. For free, here’s No. 1 principle: If you own Vancouver, and especially West Vancouver, property — never sell. Never. Your heirs, if they plan cannily, will bless you 200 years from now. How do you think the rich-beyond-the-dreams-of-avarice Grosvenor family, builders of Grosvenor Ambleside, made their pile?

As for Monday’s WV council meeting on bylaw changes — swollen by potential sellers with $-signs in their eyes — I didn’t attend. It was a choice between going to a predictable meeting and watching a new episode of The Big Bang Theory. At least I didn’t know how the latter would end.

• • •

I live in the serene conviction that there is no point in having second thoughts if your first are perfect beyond improvement. But enough laughable delusions. After a careful re-reading, I’m troubled that my last opus on the conflict among bikers, hikers and neighbours on the North Shore mountains, especially Mount Fromme, too easily let off the angries among the neighbours.

An email from one neighbour, warmly congratulating me on that column, reminded me of the old saw that you can’t be too careful in choosing your friends. I prefer Oscar Wilde’s witty remake: “One cannot be too careful in choosing one’s enemies.”

This correspondent shows no concern that such action could kill, or leave a rider paraplegic. (I emphasize the writer is not the woman accused of mischief to property likely to cause death, for allegedly booby-trapping trails apparently set for mountain-bike cyclists.)

Some excerpts: “Mother Nature drops large trees on the trails … and her branches fall from the tree canopies. Rocks and stones become loosened from the forest floor as bike tires erode the trails. All hazards . . . The mountain bikers . . . knew about those log and forest debris ‘traps’ for years (a mere annoyance to them, until now. Many riders just ‘bunny-hopped’ the small logs).”

This calm equating of the natural fall from trees with deliberate human intent to place dangerous objects on bike trails should raise more than an eyebrow. The writer concludes: “Thank you . . . for letting people get a peek at the ‘dark side’ of the mountain biking community,” and if mountain bikers throw “any derogatory comments” at me for my previous column, “it is just in their nature to do so.”

Thanks, but no thanks. Still, one must empathize with neighbours at the end of their tether after years of conflict. The vicious postings by bikers, as noted in my previous piece, are indefensible. There’s enough blame to go around on this issue.

A wise letter to the editor Feb. 15 by John Sharpe, a mountain biker for 20 years, weighs the very well organized and funded lobbying group, the North Shore Mountain Bike Association, against “a very few random, frustrated voices in the community sticking up for what they believe in.”

My second thought echoes my first: This is an ugly, dangerous war zone. Send in the peacemakers. John Sharpe would be a fine nominee.

• • •

I try to maintain a mask of ho-hum professional cynicism about government folly, but the B.C. Liberals’ crazed water legislation takes the gateau.

After decades of giving our groundwater free to Nestle’s, B.C. will charge this bloated Swiss behemoth — world’s biggest food company, in 2011 declared the world’s most profitable corporation by Fortune Global 500 — a ludicrous $2.25 per million litres, less than the retail price of a dozen bottles. And not for the water. That’s the bureaucratic fee for accessing it. The water’s free.

“Water should not be used as a revenue stream by government,” Environment Minister Mary Polak declared. Why not our natural gas too? Has Premier Christy Clark considered projections that water will be the oil of the 21st century?

© Trevor Lautens, 2015

Hamilton hometown finally hits the residential real estate big time

Appeared in Business in Vancouver – February 26, 2013

The cost of the roof over one’s head in Vancouver is almost as gripping as a Roberto Luongo interview.

Grasping two suitcases, I moved here – greater population then about 800,000 – 50 years ago this month, long before the (Rich) People’s Republic of China invasion. After a brief stay at the Hotel Vancouver, $10 a night, I took shelter in the Kitsilano Point home of kindly Mary Ivanocko, who knew a helpless, motherless lad when she saw one. My lodgings consisted of one room with a Murphy bed, kitchen, shared bath and Mrs. Ivanocko’s cleaning services: $50 per month.

I jumped to a suite on The Crescent, a distinguished Shaughnessy address where near-neighbours were the Rogers sugar family, the newspaper Southams, and B.C. Electric president Dal Grauer. $75. Incredulous? Well, Ottawa’s wartime Order-in-Council 200 had suspended zoning regulations and allowed mansions to be broken up for needed war-workers’ suites – eggs not easily unscrambled. By the 1960s they were furiously attacked by old-money Shaughnessy.

One Sunday around 1967, my temporarily beloved and I checked five solid houses in Mackenzie Heights. All under $20,000. A bit later an advertisement lured us over a scary logging road to a remote place called Whistler. A gent straggled from a trailer and pointed out hillside lots from $7,900. I looked around. Who the hell would ever buy land in this God-forsaken wilderness?

My rental days topped out in 1968 at $150 a month for a walk-up Kitsilano penthouse, superb view. With the average house even in once-despised East Vancouver valued at $1 million, now I’m a landed multi-millionaire – Monopoly money, I fear.

And the currently highest-assessed Vancouver property, a 25,000-square-footer on uber-fashionable Belmont Avenue, clocks in at $39.2 million. You may think this compares a B.C. apple to a California orange, but try this on for size:

A 13-acre Bel Air home was recently on the market. A snug 7,500 square feet, true, but there’s a guest house, staff quarters, a lap pool, and vineyards and a winery producing 1,500 cases a year, $4 million worth of wine included. Yours, total price, for US$29.5 million – nearly $10 million in about-par Canadian dollars cheaper than the Belmont property, enough left over for some of life’s bare necessities.

Plus this cachet to casually drop into your dinner talk: it was built by Hollywood legend Victor Fleming, director of record (the film chewed up directors) of Gone With the Wind, its frenzied scriptwriting uproariously depicted in the late lamented Vancouver Playhouse production, Moonlight and Magnolias. That same year, 1939, Fleming directed another classic. Hint: Click your heels and ask for a direct flight to Kansas.

Too tastelessly Hollywood? For the more discreet businessman, the daughter of big, big oil baron H. L. Hunt is selling her 12,273-square-foot New Mexico hacienda on 263 acres – with an 1890s house thrown in – for $15.1 million.

But True North Strong and Free persons will especially salivate for Wayne Gretzky’s abode in Thousand Oaks, California, offered at $15 million. It’s a tight 10,815 square feet but has two guest houses, one with a full-size gym, and, at no extra cost, Britney Spears as a neighbour.

Close to home, the tony du Pont Registry currently lists just one Canadian property: Twin Oaks, a 20,000-square-foot Vancouver Island house and estate “designed and built by one of the world’s great entrepreneurs” for … “price upon request.” Not shared with an inquiring journalist, I found.

© Trevor Lautens, 2013