The topic of the relationship between wealthy, primarily Chinese, immigrants and their effect on Vancouver’s housing market has recently become a bit of a hot topic in the city. I was recently quoted in Vancouver Magazine on the topic, and specifically on the relationship between the Canada and Quebec immigrant investor programs and immigration to Vancouver.
The answers to such questions lie largely in the numbers, though not necessarily the obvious ones. Anyone in real estate will tell you the wealthy arrivals dominating the market are mostly from mainland China, yet immigration from there has been dropping in recent years. In 2009, just under 9,000 mainland Chinese arrived in Vancouver, down from almost 13,000 in 2005. But, says Steven Meurrens, an immigration lawyer with Larlee Rosenberg, official numbers don’t necessarily reflect reality. About half the Chinese immigrants arriving in Vancouver are in the investor class and thus must prove a net worth of at least $1.6 million (doubled since new rules were instituted in late 2010).
That number might mean only 1,200 or 1,500 households-not terribly significant in a region where sales exceeded 40,000 in 2010-but Meurrens says the number of investor immigrants from mainland China landing in B.C. is actually considerably higher than what those reports suggest. In the 12 months ending September 30, Quebec (which has its own immigration system) turned away virtually no one, issuing almost 6,000 investor-class visas of its own. There are no restrictions on where visa recipients settle, and a significant number choose Vancouver over Montreal. “The money goes to Quebec,” says Meurrens, but “our office regularly advises people who immigrated under the Quebec Investor program and have a wife and child living in B.C.”
Indeed, according to a report in the National Post on May 17, 2011, Chinese buyers have caused Vancouver’s average housing prices to eclipse London and New York.
In 2010, Vancouver had the third-highest housing costs among English-speaking cities worldwide, according to Canada’s Frontier Centre for Public Policy. Only Hong Kong and Sydney, another magnet of Asian immigration, were more expensive. Vancouver’s median home price of $602,000 was 9.5 times the annual median household income of $63,100, the group said in a study released Jan. 24. Canada had a 4.6 national multiple, making it “seriously unaffordable,” while the U.S. at 3.3 was “moderately unaffordable,” the study showed. To be affordable, the multiple must be 3 or less.
Vancouver was more expensive than San Francisco, London and New York by that measure, the Winnipeg-based centre said.
The Canadian embassy in Beijing has expanded the Student Partnership Program originally launched in India to China.
The program creates a special processing channel at the Beijing visa office for students destined to member institutions of the Association of Canadian Community Colleges, whose membership includes Camosun College, Douglas College, Kwantlen Polytechnic University, and Vancouver Community College. Students using the program will experience a far shorter wait time than normal applicants, in some cases less than two weeks.
The application form can be viewed here: http://www.canadainternational.gc.ca/china-chine/assets/pdfs/immigration/beijing/documents/SPP_Application_Kit_2010_07_EN.pdf
The processing time for PR Card renewals has ballooned from roughly 42 days to 171. There are several reasons for this, including personnel reductions at Case Processing Centre Sydney, a higher than expected number of permanent residences wanting to renew their permanent resident card instead of applying for citizenship, and increased complexity of some of the files.
Yesterday I also recommended to an individual who is a frequent flyer and whose PR card was set to expire in February that he start the application process now. He replied that this would cause great difficulties because he would have to turn in his existing, still valid, PR Card.
This is not the case.
From Immigration Canada’s website:
If you are applying to renew your present card and:
your card has expired, you should return it with the completed application for a new card or
your card is still valid, you may hold on to it and return it to a CIC officer when you pick-up your new card at a local CIC office.
If you are applying to replace your damaged card, you should return your card with your application.
Individuals who are deciding whether or not to apply early to renew their PR Card should thus not worry about having to turn their existing card in.
My comments were a response to recent Chinese immigration trends to British Columbia.
The interviewer wanted to know my response to the following statistics compiled by BC Stats:
PRC LANDINGS TO BC
It is clear that in the 2005 to 2009 period there has been a decline in PRC immigrants to British Columbia. This certainly runs counter to popular myth.
Second, that decline can be largely explained in the near collapse of immigrants under the Federal Skilled Worker Program (“FSWP“). This decline has occurred across Canada, and is not limited to China.
Third, there has been a huge increase in the amount of immigrants under the Provincial Nominee Program.
I was also asked whether I thought that there was a deliberate effort on the part of Citizenship and Immigration Canada to keep Chinese people out. I think that the answer is clear that except for the FSWP the amount of Chinese immigrants in the other categories remain steady. Some have speculated that this is due to Chinese people failing to meet the language requirements. In my opinion, if this were the case, then there would have ALWAYS been a low acceptance rate. Surely the amount of Chinese people that are proficient in English is equal to, if not higher than, the amount that could speak English in 2005.
The FSWP has long been in decline. The recent reduction of the amount of eligible occupations and the placing of a cap on these occupations are all signs that this will continue.
Prospective immigrants should thus seriously consider the Provincial Nominee Program.
On May 17, 2011 the Fraser Institute published a study titled “Immigration and the Canadian Welfare State”. It was the first Fraser Institute study that I’ve read on a topic which I am very familiar with. Unfortunately, by the time I had finished reading the report, I realized that I might have to approach their studies with a greater degree of skepticism.
The study found that immigrants on average paid $10,340 in income and other taxes while all Canadians on average paid $16,501. Subtracting that amount from the amount of government benefits that immigrants receive on average, the study concluded that immigrants imposed an annual fiscal burden of between $16-billion and $23-billion on the Government of Canada.
Now, if you are an immigrant reading that statistic and feel guilty, don’t worry.
The study did not consider that if you were an international student you paid double what domestic students did. It also did not factor in the $250,000 – $800,000 loan that you made to the Government of Canada if you were in the investor program. If you were a professional overseas and could not get your foreign credentials recognized in Canada the study briefly mentioned the issue in a footnote, but assigned very little weight to it.
Incredibly, the study also did not distinguish between economic immigrants, family-class immigrants, business-immigrants, and refugees. Presumably, the fiscal burden between these groups would vary dramatically.
The study glossed over or dismissed some of the other benefits of immigration. Regarding the argument that second and third generation children of immigrants do exceptionally well in Canada, the study’s authors simply expressed doubt on this notion. Perhaps the authors should have read the MacLeans feature on whether Canadian universities are too Asian before simply dismissing this argument.
The study also stated that immigration is unlikely to solve Canada’s aging population issue, and that a better solution is to increase fertility rates. Well, until the Fraser Institute solves a demographic challenge that the entire western world cannot seem to resolve, I’ll stick with policies that at least help.
Ironically, most temporary foreign workers, students, and prospective immigrants would probably jump for joy if the Canadian government actually implemented the study’s policy proposals.
Those unfamiliar with the specifics of Canada’s immigration laws, as I would suggest the authors of the Fraser Institute study appear to be, would summarize the proposals as restricting immigration so that only people with genuine offers of employment could become permanent residents.
Those familiar with Canadian immigration law would summarize the author’s proposals as removing the Labour Market Opinion requirement from the Temporary Foreign Worker Program, and expanding the Canada Experience Class to include all Temporary Foreign Workers who have worked in Canada for four years. As a practicing lawyer who currently avoids having to submit an Application for a Labour Market Opinion whenever I can an alternative for my clients, I’d certainly be thrilled if the NAFTA rules applied to all immigrants.
(For those who may be unaware, most employers have to obtain a Labour Market Opinion before they can employ a Temporary Foreign Worker. In order to receive a positive Labour Market Opinion, employers have to convince the Canadian government that the wage they will be paying the foreign worker is fair, and that the presence of the foreign worker in Canada would not have a negative impact on the Canadian labour market. In today’s economic environment, it is very difficult to obtain.)
The study’s proposals contain ideas that the authors present as being radical and possibly difficult to implement, but in fact already exist. For example, the authors hypothesize about the possible problems of creating a list of minimum and average wages for occupations in Canada, without seeming to realize that such a list already exists, is available for free online on the Labour Market Information website, and is referred to hourly by immigration lawyers, consultants, and the Government of Canada. The study’s authors also discuss the idea of sponsors posting bonds, without explaining why the current sponsorship undertaking is insufficient, or even mentioning it.
The Fraser Institute seems to have no idea how open its proposals would be to abuse. They do propose to create a public-private partnership to monitor employer abuse, however, given how easy access to the Temporary Foreign Worker Program would be under their proposals, it is unlikely that any body could effectively regulate employers. (As an aside, public-private partnerships might be great to build a school or a highway, but do we really want the Canada Border Services Agency to become a P3?)
As someone who encounters the practicalities of Canadian immigration law on a daily basis, I can assure the authors that the current immigration system is generally fine. Where there are gaps and holes, the Conservative government is taking mostly practical measures to plug them.
As for the supposed fiscal burden that immigrants impose on Canada, the study states on numerous occasions that as immigrants become more integrated in Canada, the fiscal disparity between them and native-born Canadians shrinks dramatically, and eventually disappears. Given this, it seems clear to me that the solution to any fiscal imbalance is to expedite the rate at which new immigrants integrate. Recognizing foreign credentials, increasing settlement programs, and promoting language training would be far more effective in reducing any fiscal imbalance, if there is indeed one, then the Fraser Institutes proposals.
The dragon is sputtering. According to figures released by Citizenship and Immigration Canada, more immigrants will arrive from both the Philippines and India than from China in 2010. Continue reading →
Manitoba is located in the prairies. Its population is the fifth largest in Canada, at 1,232,654. It’s capital city is Winnipeg, where 60% of Manitoba’s population live, and is where four of the province’s five universities are located. It also has Canada’s most successful provincial nominee program. Continue reading →