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Daily Frontline

Two years before CBC News revealed that dozens of people had allegedly abused a B.C. Housing affordable homeownership program in Victoria, the agency’s leaders were warned there was a “high risk” the situation could become public.

According to documents obtained through a freedom of information (FOI) request, B.C. Housing’s executive committee was warned in April 2022 the public might take a “negative” view of the revelations as “a possible failing by B.C. Housing to prevent program abuse or, in the worst case, fraud.”

The documents say the agency’s communications team had a plan to demonstrate a “swift and fulsome approach” to dealing with purchasers accused of gaming a program that was designed to get middle-income British Columbians into the housing market — but kept quiet.

“Our communications have provided the ministry with all of the information [but] had decided against a public release at this time,” B.C. Housing senior development manager Sarah Smith wrote to the Vivid developer when the first lawsuits were filed against owners.

“As you know, this could change at any time, though.”

‘Purchasers were permitted to own other properties’

The nearly 4,000 pages of FOI documents provide detailed insight into the failings of a program heralded as “great news” for middle-income citizens when then-housing minister David Eby announced the completion of construction at the 135-unit Vivid condominium building in May 2021.

Almost three years later, CBC revealed as many as a third of those units were sold to people who violated the terms of contracts requiring them to live in their suites for at least two years. Many also already owned property — in some cases, multiple homes worth millions.

David Eby was housing minister when construction was completed on the Vivid building. He applauded the project as ‘great news’ for middle-income British Columbians hoping to achieve the dream of home ownership. (Ben Nelms/CBC)

B.C. Housing has bought back at least 19 of the units, and court records show lawsuits against more than two dozen Vivid purchasers accused of undermining the “Affordable Home Ownership Program for personal benefit.”

The FOI documents shed light on one of the key questions to emerge around the project. In the same news release announcing the end of construction on Vivid, B.C. Housing said buyers “could not own property anywhere else in the world.”

But according to the same executive committee report warning of risks around public perception, “Chard requested, and B.C. Housing agreed, that this last requirement be relaxed and so purchasers were permitted to own other properties.”

‘Inconsistencies with middle-income households’

Chard received a $53 million low-interest loan from the province to underwrite below-market sales of suites listed at an average of 12 per cent below market rates.

Purchasers had to be Canadian citizens or permanent residents whose combined gross annual income was no more than $150,000.

An inside view of a hall in the Vivid building.
FOI documents obtained by CBC contain pictures taken inside Vivid units that were later bought back by B.C. Housing because their purchasers had violated the terms of an affordable home-ownership program. (BC Housing)

The FOI documents contain a copy of a deal with a third-party consultant paid $80,000 by Chard Development to vet Vivid purchasers — including $550 per applicant review. In an accompanying email, president and CEO Byron Chard notes the consultant was recommended by B.C. Housing.

“Subsequent review by B.C. Housing of the owners’ detailed information provided at the time of purchase indicated that as many as 51 units appeared to contain inconsistencies with middle-income households, such as ownership of one or more high-value single-family homes, all-cash purchases which required no mortgage, and inconsistent income documentation,” said the report to the executive committee.

The submission to the executive committee was prepared in April 2022 ahead of an interim $19.6 million loan from the Provincial Rental Housing Corporation to buy Vivid units back from purchasers who had agreed to return their suites after it was found they had violated the terms of of the program.

The same document says a review found “possible breaches of the covenants alleging one or more of the following:

  • Purchasers who submitted T4 for salary, however, may have excluded annual income from personal corporations (Realtors) or solely owned private companies.
  • Purchasers who own one or more single-family home(s) and have not moved into the Vivid unit as their primary residence.
  • Purchasers who own one or more other properties and are also renting the Vivid unit.
  • Middle-income legal couple who may have excluded one individual’s income to qualify.”

The FOI documents also contain a copy of a confidential memo from B.C. Housing chief executive officer Vincent Tong to B.C. Housing’s board of commissioners the day after CBC broke the news, the agency was suing a number of Vivid purchasers.

“I want to provide you with an overview of a story many of you may have been hearing about in the news,” the memo begins, before laying out the details of the Vivid program and the ensuing lawsuits.

“B.C. Housing filed the first legal claims in the spring of 2022. Prior to filing these legal claims, the board of commissioners and the Ministry of Attorney General, [the ministry then] responsible for housing, were briefed and informed.”

‘Singled out by name and by photographs’

In recent months a number of Vivid purchasers have fought back against the legal claims — including Janet Yu, a real estate agent accused of realizing “significant personal profit by acting as a Realtor for a number of purchasers in the Vivid building.”

Yu, who also bought a unit for herself, is accused of making nearly $53,000 in commissions from the sale of 12 units to people who were “nearly all” in violation of their affordable homeownership program covenants.

Real estate agent Janet Yu
Real estate agent Janet Yu claims she was singled out by name and by photographs in public media after being sued by B.C. Housing over sales at the Vivid condominium building. (Janet Yu/Sutton.com)

In her defence, Yu argues that “she remained resident at the lot” and says there is no evidence the commissions “were unusual, improper or in any other way constituting a wrongful act.”

She says the claims “against her inevitably and predictably attracted media attention to the matter.”

“[Yu] has been singled out by name and by photographs in public media and by statements made by public officials associated with the plaintiff and the development for criticism and harassment,” Yu says in court documents.

She says the “public media attention” resulted in an investigation by the B.C. Financial Service Agency “asking whether she has brought the real estate industry into disrepute.”

Other purchasers have claimed they were unaware they were buying into an affordable home-ownership scheme and have challenged claims the units were sold below market rate.

“The Government of British Columbia gained political capital from publicizing its involvement in the project,” reads one reply.

In an email, B.C. Housing said the agency was “unable to respond to media with any information beyond that which is already publicly available on our website” because of the upcoming provincial election.

Chard says the project’s key objective was to offer below-market homes to purchasers with combined gross household incomes of less than $150,000 who pledged to live in their unit as a primary resident for a minimum of two years. In an emailed statement, he says his company fulfilled its obligations as outlined in B.C. Housing’s preliminary and final project approvals for Vivid.

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