Something smells fishy on Belmont Avenue in the prestigious, mansion-packed neighbourhood of Point Grey in Vancouver.

While there seems to be a new jaw-dropping real estate story breaking in Vancouver every week, this one could be one of the most unbelievable – and the most illegal. It has been uncovered that a $31M Point Grey mansion is – allegedly – owned by a Chinese student, Tian Yu Zhou. (_^CKNW)

Really?! It seems highly unlikely that the 5-bedroom, eight-bathroom mansion could be within the budget of student, which means someone else is footing the bill. Could you imagine a college freshmen kickin’ back in a luxury mansion that might look something like this:

According to an investigative reporter, Kathy Tomlinson, as long as his parents keep paying the bills, there’s nothing outright illegal about it. In fact, she’s seen plenty of similar cases where big money properties are registered to students or home makers with little or no income. It’s just one more sign that foreign investment in Vancouver real estate is something to be watched, and perhaps regulated.

According to Tomlinson, the real problem arises when the property isn’t actually occupied by the student, and when the real owner, the parents usually, don’t claim any tax gains because of that. So they’re able to be investors in Canada, and own homes and sell them and have them as investments and not pay capital gains tax. Sneaky! It has also been suggested that money is being poured into Canadian real estate (much like a bank account in the Cayman Islands) by wealthy Chinese citizens whose finances may be under scrutiny.

And this is happening under the radar all over Vancouver! Tomilinson claims that there are a great many luxury properties she’s investigated that are allegedly owned by students, but that are completely unoccupied – no furniture or anything. This would corroborate the theory that the foreign owners may be trying to avoid taxation.

So, how much foreign money has been invested in Vancouver? Well, In the Greater Vancouver Area, economists estimate Chinese investors spent $12.7-billion – or 33 per cent of total sales in 2014. That figure, they say, lines up with research from B.C. urban planner Andy Yan, who found that 66 per cent of all sales of 172 detached homes in three west-side Vancouver neighbourhoods within a six-month period were to Chinese buyers. The government is concerned about how capital inflows from mainland China have affected the local residential real estate markets (not mention the concern surrounding whether the incoming money is ‘clean’). Regardless, it has certainly fuelled the debate raging in British Columbia over our open economy and immigration policies. _{(Globe and Mail)}

So here’s the big question: what the heck is Vancouver going to do about it?

Other more publicly exposed schemes, like ‘shadow flipping‘, have been having a detrimental effect on Vancouver’s real estate market.

That’s quite a quandary for policy makers – and city residents – to wrestle with, as the global economy impacts global cities.

Here are some other outrageous stories about the Vancouver real estate market that have gone viral over the last year:

A 71-Year-Old Bungalow On Vancouver’s West Side Just Sold For $1M Over Asking

Ramshackle Teardown In Vancouver’s Point Grey Neighbourhood Offered For $2.4Million

Desolate Vancouver House Selling For $25 Million

Posted by Steve Fudge, the purveyor of canadianrealestatehousingandhome.ca and the proprietor of urbaneer, a division of Bosley Real Estate Ltd., Brokerage, in Toronto, Ontario