Affordable-housing buyers already owned homes, civil suits claim

Built with a $53-million low-interest loan from the province to underwrite the below-market sale of family homes, Victoria's Vivid condominium development was supposed to be a new model for affordable housing in B.C.

Then-housing minister and now premier David Eby hailed the 2021 completion of construction on the 135-unit buildingin the provincial capital's downtown as "great news" for middle-income British Columbians hoping to achieve the dream of home ownership.

But court documents obtained by CBC allege that as many as adozen of those condos were sold to people who already owned property in some cases multiple homes worth millions.

B.C. Housing claims 13 purchasers never lived in homes they agreed would be their principal residences in violation of agreementssigned for the right to buyat discount prices.

In hundreds of pages of B.C. Supreme Court civil claims, the Crown agency has accused an array of buyers including a real estate agentwho allegedly made $53,000 in Vivid commissions of "egregious and reprehensible" conduct.

"The defendant has intentionally undermined the purposes of the Affordable Home Ownership Program for personal benefit," says the boilerplate language in each of the lawsuits.

"The conduct of the defendant has negative repercussions for all of the people of British Columbia."

A 'pilot project' for affordable home ownership

The Affordable Home Ownership Programis administered by B.C.Housing as part of a multi-prongedeffort to combat theaffordable housing crisis.

"The intention ...is that units made available through the program be owned and occupied by people who otherwise might be unable to participate in home ownership," the lawsuits read.

In 2021,B.C.Housingcalled Vivid a "pilot project" for partnerships between the private and public sector to boost "the supply of affordable home ownership options for middle-income families and individuals in Victoria."

The province said it gave a $52.9-million low-interest loan to Chard Developments to build the project.The developer was then expected to "pass the savings on to qualifying buyers so units could be purchased at below-market prices."

As a result, thegovernment claimed homes at Vivid sold for anaverage of 12 per cent below market rates at the time of purchase.

The civil claims say Vivid buyers all attended an "affordable housing program education session" where they were told the project was financed by B.C.Housing and they "were being provided with a discount on the value of their unit."

'She could not tell anyone that she was renting'

To qualify to buy at Vivid, the province saidbuyers had to be Canadian citizens or permanent residents who could not own property"anywhere else in the world."

According to the court documents, purchasersalso couldn't have a combined household income exceeding $150,000.

Buyers agreed to make the units their primary residence and to "physically reside" therefor at least two years.

To ensure compliance, a covenant wasregistered against each propertysetting out that the unit "shall only be used and occupied for the provision of affordable housing by qualified persons."

But according to the lawsuits,the purchasers of at least 13 units never moved in.

The court documents claim two of the purchasers never set up the intercomsystems for their units and another never booked the elevator for a move.

In June 2022, B.C. Housing claims a student from China contacted the Vividstrata council claiming she was paying $1,800 a month to rent the unit for which a Victoria couplepaid $317,400.

She allegedly said she was being evicted.

"She had been instructed that rentals were not permitted and that she could not tell anyone that she was renting," the lawsuit reads.

According to the civil claim, the unit's ownersalso own six other homes in the Victoria area worth acombined total of $7.75 million.

Real estate agent'realized significant personal profit'

The documents claim another coupleown a million-dollar home in Nanaimo and four condos in Burnaby and Victoria worth more than $2.2 million.

One of the other people named is a retiree who allegedly owns a general contracting company with his wife.

The documents claim the couple own two Victoria condominiums and that their company owns or operates nine other properties in the Saanich area.

The buyers named in the lawsuits come from all walks of life scientist, student, insurance broker, businessman. A number are retired including a man who allegedly owns a $1.7-million home in Nanaimo where he "currently operates what appears to be a small hotel."

Yet another of the retired buyers was allegedly living in subsidized housing in Chinatown instead of her $309,120 unit atVivid when B.C. Housing filed suit against her in December 2022.

The bulk of the lawsuits were filed in 2022, but B.C. Housing filed the latest notice of civil claim this weekagainst a software engineer who allegedly paid $300,400 for a unit atVivid; the suit says he also ownsa $716,000 detached homeand $425,300 townhome in Victoria.

The agency is also suing real estate agentJanet Yu, who B.C. Housing claims "realized significant personal profit by acting as the realtor for a number of purchasers in the Vivid building." She also bought a unit for herself.

"Nearly all the purchasers for whom [Yu]represented as a realtor have also failed to comply with the terms of the Affordable Home Ownership Covenant," the claim against her reads.

B.C. Housing claims Yu made commissions worth nearly $53,000from the sale of 12 units. The court documents say Yu lives at a different address with her partner and owns or co-owns properties worth nearly $3 million.

The government 'gained political capital'

The lawsuits are seekingan order to have the title for the units transferred back to B.C. Housing giving the buyers back what they paid "minus fees and disbursements."

The Crown agency also wants all the money the buyers collected from rentals and is seeking punitive damages a sanction reserved for particularly egregious cases.

WATCH | The Victoria condo was billed as affordable:

B.C. sues affordable-housing buyers who own multiple properties

5 months ago

Duration 2:10

Lawsuits filed by B.C. Housing allege that affordable condo units in Victoria, meant to help middle-income homebuyers get into the market, were purchased by people who already owned property in some cases, multiple homes worth millions.

"Given the overarching importance of making affordable housing available within the province, punitive damages are required to achieve the court's goals of retribution, deterrence and denunciation," the lawsuits read.

Yu is one of only two people named in the suits to respondto the claims.

Onelawsuit was discontinued; the buyer who allegedly also owned a $1.3-million condo in Whistler told CBC he intended to move to Victoria but his circumstances changed because of COVID. He said he couldn't move into the unit so he "ended up giving it back."

Yu denies the allegations.

In her response, Yu claims she "does not speak English as her first or principal language, and has limitations with respect to her understanding of English."

She says she relied upon advice from "the presenters of the affordable housing program educationsession" and a solicitor "before whomshe attended to executethe subject statutory declaration."

Yu also claims she "remained resident at the lot" with the exception of "short and occasional visits to family."

She claims no one everprovided her with evidence of the unitshe purchased "having a greater market value than the price she agreed to pay for it."

Another buyer who also allegedly owns a $1-million home in Victoria said in her response that if any subsidy was given "it was to the developer of the strata lots."

"She paid fair market value for the strata lot," the woman's response says.

"The Government of British Columbia gained political capital from publicizing its involvement in the project."

Yu did not return a call from CBC.

In an emailed statement, Chard Developments president Byron Chard said, "This issue is currently before the courts, and therefore, we will not be commenting at this time."

B.C. Housing had not provided a comment by the end of day Monday.

In a statement, a spokesperson said it was "important to note that Vivid at the Yates was apilotproject, it wasn't officially part of the Affordable Homeownership Programas it is currently structured."