Vancouver Condo Info

It’s that time of the week again! Lets do our regular friday news round up and open topic discussion thread for the weekend. Here are a few links to kick off the chat:

-Prediction: The Canadian Housing Market will Crash
-Household borrowing surge driven by most indebted
-Boomers ‘punch drunk’ on debt
-Canadian home prices fall for first time since fall, 2010
-Either Windsor or Edmonton has the most affordable market
-Canadas job market in bad shape
-Property taxes on the rise
-$100 hot dog, get it while it’s hot.
-US banks face margin pressure from fed rates
-US new home sales worst ever in fall 2011
-A real estate downturn down under?
-

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

Looks like the US fed isn’t very optimistic about the recovery. They say Japan style interest rates until 2014. Will this help a US house price recovery, or will buyers wait if they know there’s no rush for bargain rates?

Look at this garbage. It’s an article submitted by “The BC Real Estate Convention” and printed as if it’s actually news in the Vancouver Sun. First off, the writing is atrocious. Don’t they even have an editor read these advertorials before they’re printed? Second, there are lots of statements presented as fact that have absolutely nothing to back them up:

Experts claim that the Chinese Mainland buyers and investors will continue to seek for overseas investment opportunities, in Vancouver.

Which ‘experts’ are these? Oh never mind, we’ll just take your word for it then.

As it is more cost efficient to purchase a property rather than renting, and considering the long term returns of the investment, purchasing properties in Vancouver become high on demand.

Yeah, somebody is ‘high on demand’ if they really believe that current prices in Vancouver make buying ‘more cost efficient’ than renting. There are many many markets around the world where buying is ‘more cost efficient’ than renting, Vancouver ain’t one of them.

However, as much as Feng shui is a well respected practice by many Chinese immigrants and potential home buyers and investors, there are always those “intelligent” ones that seek to obtain the optimal economic value from their investment in Vancouver’s real estate.

Wow. I don’t even know how to respond to that.

If you go to the The BC Real Estate Convention web site you’ll see that this trade show is sponsored by The Vancouver Sun and Province.

Then there’s this piece over at 24 hours:

Metro Vancouver will receive an influx of businessmen from mainland Chinese this week, intent on spending their two-week Lunar New Year holiday with family, as well as scooping up significant amounts of real estate.

Julia Rowell, sales manager at downtown Vancouver’s Maddox development, said this phenomenon has been going on for over 25 years, but 2012 looks to be especially busy.

Yeah? I think TPFKAA says it best:

HAHAHAHAHA! That’s absolutely hilarious!!

So in 1987, (a full five years before Deng Xiaoping’s reforms that enabled creation of individual fortunes) HAM from mainland China was increasing sales just after CNY.

/facepalm.

The hype seems to be working on the listings side. This year started off with the second highest number of listings in the last ten years and has grown at a faster rate than any of those years, especially on the west side:

I’m sure those sellers are hoping this hype pays off, and maybe it will, but then again maybe our market isn’t driven solely by wealthy offshore buyers. Most local first time buyers aren’t in the market for multimillion dollar homes anyways, so how would this even affect them?

Blaming ‘Chinese buyers’ for out of control prices is simplistic and racist. This city is nearly half asian so of course ‘Chinese buyers’ have an impact, but what about easy credit, low rates, CMHC pumping and local speculators?

Just for comparison, the city of Monterey Park in California has the highest percentage population of Chinese Americans of any US municipality. Here’s what home values there look like over the last few years:

This post was submitted by RTYT.

Mark Carney is making new remarks about some Canadian real estate markets being “probably overvalued“.

It was the second time in recent days that Bank of Canada Governor Mark Carney voiced concern about property prices, which surged after the financial crisis as borrowing costs tumbled.
“We see that in a number of real estate markets in Canada, valuations are at a minimum, firm; in others, they’re probably overvalued. So there are risks there. We’re watching it closely. We’re working with our partners, the federal government, the superintendent of financial institutions,” he said in an interview on “Question Period” on CTV.

“Measures have been taken. They’ve been effective. We’ll keep up that vigilance. If more needs to be done, I’m sure the appropriate authorities will take those measures.”
The federal government has tightened mortgage regulations several times in a bid to prevent a property bubble from forming. Finance Minister Jim Flaherty said on January 17 that the government is watching the housing market closely and is ready to intervene if needed, but is not about to do so now.

Yes, the federal government has tightened mortgage regulations “several times”.. Here’s a timeline of those changes courtesy of Burbs Boy:

Jan 2006 – Minority Conservative Government elected
Feb 2006 – 25 year increase to 30 year on test basis
Jul 2006 – 30 year test affirmed and also increased to 35 year
Jul 2007 – 35 year increase to 40 year
Oct 2008 – 40 year decrease to 35 year
Mar 2010 – 35 year decrease to current 30 year

This post was submitted by wreckonomics.

It’s that time of the week again! Lets do our regular end of the week news round up and open topic economic discussion thread. Here are a few links to kick off the chat:

-No retirement savings? No problem!
-Big sale on Granville, hoping for wealthy Chinese buyers
-Tax assessments hit Vancouverites hard
-Carneys low rates yield more houses than machines
-REBGV inventory rocketing at start of the year
-West Van and Richmond have highest child poverty levels
-Questions and Answers
-One does not..

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

A very good analysis form a leading Bubble Blogger in SoCal. The good Doctor began blogging about the US bubble years before the collapse. He has an interesting analysis of Vancouver’s bubble here along with some good comments.

http://www.doctorhousingbubble.com/canada-housing-bubble-ripe-for-popping-vancouver-housing-bubble-2012-pop-real-estate-canada/

In the last few years I’ve noticed that many of the cable finance and housing shows highlight families in Canada. Shows that talk about debt or home buyers are usually focused on families in Canada which is rather odd given that we are here in Southern California. Yet the funny thing about these shows is that they rarely identify that they are in Canada although I recognize locations like Vancouver. If one simply tuned into the show it would appear that a bubble was still going on in the states. This is probably the point. After all, the cable shows focused on flipping houses or making quick bucks on real estate started going off the air yet another bubble was still going on up north. Obviously these shows had an audience otherwise they would not be on the air. Now the focus is on the Canadian bubble and American audiences can swim in the nostalgic dreams of the glory days of domestic housing. Yet the shows rarely mention their location as if English-speaking families and cookie-cutter condos and homes are so easily interchangeable that they will fool an audience. Yet one thing the shows fail to acknowledge is that the Canadian housing bubble is even more pronounced than that in the United States.

This post was submitted by mojojojo.

Someone over at the Vancouver Courier is of the opinion that foreign buyers have driven up the cost of real estate in Vancouver.

Of course, capitalism requires competition, and free market principles should drive our housing market. But we no longer control that market. And despite growing evidence of market dysfunction, Premier Christy Clark, who could stiffen provincial regulation, and Mayor Gregor Robertson, who could increase taxes on foreign property owners, cede our land to foreign buyers.

Not so in Australia.

In recent years, Australian cities have experienced Vancouver-style real estate booms, with housing prices soaring from Sydney to Melbourne. Like here, buyers from China help drive Australia’s speculative real estate market. Faced with mounting public pressure, in 2010 the Kevin Rudd government introduced strict regulation aimed at foreign ownership. Under the new rules, the Foreign Investment Review Board (FIRB) screens foreigners (including temporary residents and students) to determine their land purchase eligibility. Foreigners can’t buy existing properties and must build on vacant land within two years of purchase or face government-ordered sale. Scofflaws face capital gains confiscation. Finally, before foreign homeowners leave Australia, they must sell. No more overseas landlords Down Under.

Full article here. Is it time for BC to start looking at regulating home ownership and foreign buying?

This post was submitted by Spork.

According to Paulb Monday was our first day of over 400 new listings in 2012:

New Listings 428
Price Changes 64
Sold Listings 65

Know how many days in 2011 had more than 400 new listings? None.

And look what’s happening in Richmond courtesy of Inventory.

Richmond Jan 3-16
New Listings 534
Price Changes 77
Sold 86

Some interesting things happening in this market early on in the year. The worst january in the last 10 years was in 2009 which saw a 20% sales to list ratio (we usually see at least double that).

Hey look, it’s a mortgage broker referring to a huff-post article about TD bank comments on potential mortgage rule changes.

Alexander believes the most likely scenario would be the decreasing the maximum amortization period for a government-insured mortgage from 30 years to 25 years, the report said. Furthermore, Alexander said prospective homeowners who can’t afford a 25-year mortgage against a 30-year agreement probably aren’t in a financial position for home loans anyway.

Pretty thin rumor chain for more mortgage rule changes, but what do you think? Any chance we’ll return to the traditional 25 year amort for insured loans?

This post was submitted by Scott.

It’s the end of another week and that means it’s time for our weekend news wrap up and open topic discussion thread! Here are a few links to kick off the chat:

-Condo markets in Toronto and Vancouver at risk
-Vancouver 2011 market update video
-What $1.8 million gets you in Arkansas and Vancouver
-Nine wonderful bubbles
-Condo risk bubbles up
-Royal LePage says banks are wrong, prices will not drop in 2012
-Bernanke saw ‘relatively soft landing’ in 2006
-

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!