Cheers to a New Year and another chance to get it right.
— Oprah Winfrey

Humans jump into an optimistic mind space at the beginning of each New Year with resolutions, with hope. After the surprises of 2016 we are still shell-shocked and battle-weary but back in the trenches with more realistic expectations. The real estate market in Metro Vancouver has had to remake its expectations too after the gravy train of international buyers ground to a halt thanks to Premier Christy Clark and her band of merry men and women in the cabinet anticipating the May 9 2017 election.

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.
— Charles Dickens: A Tale of Two Cities

The Two Cities are Vancouver and Toronto and the response described above includes the US election results; the effect of the new mortgage rates on Canadian buyers; Vancouver’s empty home tax plus its heritage home demolition bylaws.

Ends and beginnings – there are no such things.
There are only middles.
— Robert Frost

For the past several months commentators in the US Presidential campaign have been speculating on a possible October Surprise. A result that is the bête noir of one side and the saviour of the other. It looks like the Foreign Buyer Tax results are the October Surprise in BC. According to Maclean’s magazine: “Both initiatives are potentially devastating to one of the most important industries in Canada.

“I don’t look to jump over 7-foot bars. I look for 1-foot bars that I can step over.”
— Warren Buffet

There is now more news about the Foreign Buyer Tax. It’s mainly historical. Looking in the rear view mirror. It will take a few more months to have a reliable trend line appear. So far the effect has been what was projected. The high end of the market has slowed. Sales were slowing anyway even though prices were not dropping. The publicity from the Globe and Mail exposure of corruption in the Vancouver real estate market prompted Premier Christy Clark to look at poll numbers for the upcoming provincial election and throw foreign buyers under the bus.

“Make the best use of what is in your power, and take the rest as it happens.”
— Epictetus

KABOOM! And so went our plans to enjoy lying around in the lazy hazy days of August. The sudden introduction of the 15% Foreign Buyers Tax on July 25 surprised most observers who were expecting some action to lower house prices and stabilize the market but expected it to happen later in the year. One client who guessed right works for an organization that closely monitors government thinking and direction.