Turns out China does have a bit of a thing for Vancouver’s single family detached homes. In fact, one developer in Beijing thought Chinese buyers like them so much, they decided to build their own replica of Vancouver in China. It was such a good idea, that the Canada Mortgage and Housing Corporation (CMHC) even pitched in a little assistance. The ironic part? Much like the Canadian Vancouver, empty homes are becoming a problem, and owners have even begun selling properties for a loss.
Vancouver Forest, Beijing
The luxury development was built and marketed as a complex resembling Vancouver, Canada. It consists of 900 luxury detached single-family homes, sprawling across 55 hectares – all in the Arts and Craft, and Tudor styles you’d expect to find in Shaughnessy, Vancouver. It’s extremely green for Beijing, and built on a plot of old growth forest to make it look more like Vancouver. As crazy as it sounds, the homes 30 minutes north of the airport are really popular. According to the urban planner, properties sold out “overnight” with an average price of CA$3 million.
The Houses That CMHC Helped Build
One of the strangest things about this place is that the CMHC was involved with the construction. Yeah, the same CMHC that’s a Crown corporation designed to assist banks in lending Canadians money. Turns out they had a little known program designed to promote the export of Canadian home builders to the rest of the world.
If that sounds like the kind of business that doesn’t make sense for them, it seems like the Harper government agreed. The program was started in 1999, but it will be eliminated this year as “a part of the deficit reduction program.” It turns out it wasn’t just a terrible idea, it might have actually cost Canadians money to create jobs in China. Solid plan there.
Now here’s the strangest part. You know how everyone has been complaining that Vancouver homes are being purchased and left empty? It turns out this is happening in Vancouver, Beijing too. According to Paul Rosenau, the Canadian urban planner hired to help construct the development, “a lot of our projects sit 50 percent empty.”
Rosenau explained to the Globe and Mail’s Kerry Gold, “What’s interesting about the Chinese market is – and this is very different than here, very different than our culture – is people don’t really believe in putting their money into the bank. Anyone who has money, as soon as they have enough saved up, they buy a piece of real estate. These are middle- to upper-middle-class people.”
He further went on, “A lot of my friends in China, professional designers, someone like me, the boss of a [boutique] company like this one, they all own 15 or 20 apartments or houses. I have a friend who’s the equivalent of me in China, and he has about 20 pieces of real estate. I asked him, ‘Why do you keep buying property?’ He says, ‘how else would I invest my money?’.” Cool story bro.
A quick peek at listings, and it looks like he’s right – a lot of these places were never occupied. We found 408 listings for homes in the development, which is kind of a lot considering the final release was less than 4 months ago. Despite being new, properties are already being sold as “urgent,” or listings claim the sellers are “losing money.” Not a hard to believe scenario since focus.cn, the real estate portal of the Chinese behemoth Sohu claims that the price per square foot has dropped almost 8% in the past 9 months. Not exactly how I “invest,” but I’m old fashioned that way.
Here are a couple of my favorite listings so far:
The “King Family” – ¥12,000,000 (CAD $2,309,502)
This massive five-bedroom, 5,000 sq ft. Tudor-style home is asking roughly CA$2,309,502. The listing photos appear to show that most rooms are unfinished, so the owners likely purchased this as an investment property. Unfortunately for them, they didn’t make a whole lot of money on it. According to the listing, “the owners lose money” on this sale.
Listing photos of the “King Family” home in Beijing China.
The “McMansion” – ¥11,500,000 (CA$2,225,120)
This four bedroom, four bathroom, is half the size at 2,443 sq. ft. – but still around the same price. The listing bills it as a luxury “McMansion,” with a price so low it’s “not to deceive you,” but to “attract you!” The honesty is refreshing. From the listing photos, it looks like the property hasn’t been lived in yet, since it’s a little raw looking.
Listing photos for the “McMansion” in Vancouver Forest, Beijing.
So, what do you think? Is Beijing doing Vancouver better than Canada, or are the concrete replicas a sign of the excess speculation that’s currently consuming Vancouver, Canada. Leave your thoughts below.
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Feature photo via 推推99.