A newspaper ad from a broker in Hong Kong offering to waive the foreign buyers tax was posted to Reddit on Tuesday, kicking off a flurry of news reports in Toronto. The only problem — the ad was unauthorized and the offer was never approved by the developer.
One of Toronto’s oldest and most respected real estate developers found itself on the wrong side of a viral story Tuesday, and with it learned a valuable lesson — there’s no truth in advertising.
Following a user post to the uber-reliable modern-day news source, Reddit, implying Menkes was behind an ad in a Hong Kong newspaper (in Chinese) promoting its Fleur Condos project, a flurry of media calls from Toronto-area journalists flooded the company Tuesday morning. The ad featured an offer that the developer would “waive the overseas buyers tax”.
The Chinese ad as posted to Reddit.
The only problem with the post, and subsequent media questions, is that the developer had nothing to do with the ad.
Menkes didn’t authorize it. It didn’t approve it. It didn’t design it, place it, or pay for the ad. And it certainly didn’t approve an incentive meant to avoid the “foreign buyers tax”.
The ad, which also includes an incorrect version of the company’s logo, made a series of absurd promises on behalf of the developer. Promises so outrageous that anyone with even a shallow understanding of the condo industry in Toronto would immediately have dismissed the offer as unrealistic.
But the Reddit user didn’t come to this conclusion, and in today’s world where the urge to share has overwhelmed the urge to be accurate, the unauthorized ad went viral, and the company found itself defending something it had nothing to do with.
As Menkes said in a statement to Canadian media, the ad was placed by a third-party agent without the consent or authorization of the developer. The statement goes on to acknowledge that while independent, third-party brokers are “an important channel for the sales of condominium suites in today’s market, their network of buyers and their marketing activities are neither directed nor approved by the developer”.
A screenshot of Menkes' official statement during the CTV newscast.
Menkes’ statement added that while some local agents still seek access to a global marketplace of buyers attracted to the Toronto real estate market, “this has always resulted in a very small percentage of sales at (our) projects … (but) even the small number of non-resident purchases must meet strict government regulations, and Menkes’ own rigorous controls before firm agreements of purchase and sales can be executed.”
While the big, bad foreign buyer remains a bete noire for some media commentators, local politicians and pessimistic critics of Toronto’s real estate market, Tuesday’s story about an advertisement in Hong Kong isn’t the “gotcha” moment some might have hoped it was.
Instead of indicting the developer, the industry’s sales approach and condo buyers, it said far more about the new media landscape and our willingness as consumers to prefer speed over accuracy.
Now that’s a better story.
