anonymous at VREAA 22 Dec 2010 at 9.35pm – “I was told by a realtor dealing primarily with the Chinese segment [of the market] that many of the purchases are investment properties bought by people already here, using their first home’s equity as leverage to get a downpayment AND mortgage. As for overseas purchasers, they put down 40% cash and the rest is a mortgage from a Canadian bank. In fact, he told me many take out mortgages here with the favourable rates, and invest them in China and pocket the difference in interest!
The realtor himself owns four, rented out, and plans to sell and retire with the equity a few years from now.”
[Cavalier speculation by locals is rife and has been the major engine for this bubble. A large number of owners have “plans to sell and retire with the equity a few years from now”. Only a very small percentage will realize their dreams. -vreaa]