Maybe this time a few potential buyers will wake up and take notice.

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It was too good to be true and I might add greedy as hell. Let get real people, it looks easy on TV but in reality this game is as dangerous as the stock market. It’s also a hindrance to people who really want or need to buy but can’t at these artificial prices. In the past year I’ve have 6 sets of friends leave for Toronto which apparently has a more reasonable market. How did this happen?

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wisdomous.com

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It’s like that old movie, where Charlton Heston comes down from the mountain with the binders and that “look”.

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The real krisssh in action! The Guru extraordinaire!

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Ideologues and religious fundamentalists always project their irrationality onto those who oppose them. They do not believe in rationality, so they believe that anyone who opposes them must hold an opposing ideology.

So if you believe that “RE is always a good investment”, you also believe that any one who disagrees with you thinks that “RE is always a bad investment”. You just cannot comprehend the idea that “whether RE is a good or bad investment depends on how much you pay for it, the income it yields, and the carrying costs”.

I don’t think the gurus really believe this crap. If they did they wouldn’t be spending their time giving seminars and letting people in on their little secret. It’s their “students” who do.

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That was a lesson to mess with gurus!

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Jeeeez! I guess its hard to get a credit card with a great introductory rate and a $3.7m limit these days.

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What prompted this turnaround?

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DaMann,

Thanks for the nuggets but you did not provide over all sense I mean to say”your own views” like what do you think about the market?when is the right time to buy?
when do you think the market will crash?.How long have you been thinking like that?.you must post your point of view.

Otherwise crash is like you are telling a child do not jump from the roof you may hurt your self,Do not drive a car you might going to crash somewhere.

Based on the above term in your nuggets where do you see the prices are standing today?
have you seen the hpi graph from 1977-2008? or current one from chipman for last three year?

Btw how many home owners have been paid off their mortgage since than? etc?etc?.

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Did you notice that the receiver will be paying 24% annual interest to the firm providing the financing to finish the project. I based that on 1.9%monthly + 2% fee + 0.5%monitoring fee. They are paying 700K to borrow 3.7M over 7 months to finish the project.

Eeks, would have been cheaper to put it on the credit card.

And they said in December that they thought they could get 440/sqr ft but now in February they are hoping for 420/sqr ft.

I hope they have to keep issuing reports to the court every few months so we can track the declines!

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“The trouble is, of course, that they are always greatly respected gurus and seem so convincing at the time - and that makes them so dangerous.”

It’s like rain on your wedding day.

“Ozzie Jurock is a Canadian real estate adviser and author of Forget About Location, Location, Location. He is featured in Donald Trump’s latest book, Trump: The Best Real Estate Advice I Ever Received”

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I love how he leaves out an all out monsterous crash of 1982, or how if you bought at peak in 1995 you would have been far better off buying in 1999. God I hate this crap. Basically all these guys ever say is look how far it goes up in 30 years. umm no shit, let me put $100k in a bank account for 30 years and see how well it does over 30 years. Jesus these guys are annoying.

As well he says to go and read past articles on the world wide doom and gloomers and see how wrong they were. Hmm why not read all the Vancouver sun articles about all the RE gurus who were so damn wrong on so many occassions. Litterally months before a crash no less.

Here aer some lovely nuggets. Compliments of a poster called VG at the Victoria housing blog.

1. “Price stability, rather than decline, would be expected for most of the housing stock . . . since underlying home ownership demand remains strong due to continued high immigration.” (Frank Clayton, January 18th 1981 in the Sun. link The market crashed by about 50% over the following year. )

2. Renaud said he thinks that the trend to prices for houses has been broken by a temporary lull and that by [next year] or so prices will be equal to or greater than peak prices. (Claude Renaud, VP of Mortgage Insurance Canada on April 14, 1982. link The market took 26 quarters (over 6 years) to regain its peak in real terms.)

3. “To those who are waiting for Vancouver house prices to collapse, I can only advise them not to hold their breath . . . Unless there is a major recession or significant depopulation, house prices are unlikely to drop significantly.” (Jerry Jackman, VP Royal Lepage, November 18, 1988 in the Vancouver Sun. link In 1989, prices started to drop - with an eventual 30% or so drop. Real prices did not attain these heights again for 58 quarters, or around 15 years.)

4. “We are definitely in a transition market in areas such as the West Side, Vancouver East, and Burnaby . . . it is too early to tell if the market will stall.” (Jerry Jackman, April 20th 1989 in the Province. link Prices did not recover in real terms until 15 years later.)

5. “It is unlikely that prices will decline significantly.” (JJ again, July 18th 1989 in the Sun. link)

6. “The whole world wants Vancouver because everybody is moving here now and everything points up, up, up.” (Realtor David Goodman, December, 1989 in the Sun. link The market did not reach these heights again for 15 years.)

7. ” . . .no one is panicking over the west side housing market and he insists that it has simply ‘normalized’.” (Jerry Jackman, January 27th 1990 quoted in the Sun. link West-side prices fell by 40% in the next 2 years.)

8. “I can’t see prices reversing themselves there [in the west side] because it is still a very desirable place to live.” (Same as above.)

9. “The market is entering a more ‘normal’ phase.” (REBGV president Brian Calder, Feb 2, 1990 in the Sun. link If normal means that it takes 15 years to recover, then ‘normal’ it was.)

10. “A BC Central Credit Union newsletter released Tuesday said BC’s housing market is currently experiencing a contractionary phase but the worst of that phase should be over by late summer or early fall.” (BC Credit Union economist Richard Allen quoted in the Sun, July 5th 1995. link The decline in the late 90s was slow, but it took 28 quarters to bottom out and 33 quarters to recover to the previous peak. Some ‘phase’, eh?)

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By the way, if anyone has a story they want to share about this — as a presale buyer, someone starting to rethink a decision to buy now, etc — then CBC News wants to talk to you.

Cheers,
Lisa @ CBC

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Reminds me of a scene in the Black Adder Goes Forth series where the commanding colonel has a bizarre spurt of game theory gone horribly wrong and orders an attack on the enemy lines where the defences are the strongest.

Read his post closesly. He makes no predictions in the short term. He is observing that things have a way of working out. His comments about leverage are flawed and some of his comments comparing asset classes to real estate are misleading. He also is crafty addressing the “fear” factor that many FTBs have to overcome when taking a huge risk; it’s a mistake to equate fear/scariness with risk IMO. He has a point that one cannot be a bear forever or we’re all doomed but his conclusions seem suspect.

I wonder if Ozzie lived in Japan would he be writing the same article.

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I think it must have an effect. A weak presale market exacerbated by bad press like this is a portent for weakness. Presales not selling result in incentives that erode prices in the existing condo market. It will be obvious in short order who the flippers are when short-term appreciation is no longer guaranteed.

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Strataman

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“In our December 14, 2007 report, we had estimated the average selling price per square foot for the unsold units in the Garden City project would be approximately $440. This assessment was based on information provided by the Company and preliminary discussions with certain marketing agents. As a result of having the benefit of several proposals from marketing agents, we have now concluded that a more realistic average revenue per square foot in the Garden City project is $420.”

Of course in the end all that really matters is what the market will bear and whether you can get people to line up in excitement to give you their money.

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How does that make you feel? Gloomy?

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“The South side of the H&H property used to be a gas station. The gas station completed the appropriate environmental remediation work when it shut down and obtained a clearance certificate under commercial zoning requirements. It has been determined that the gas station was leaching hydrocarbons under Helmcken Street. There is a risk that groundwater may flow from Helmcken into the H&H property discharging hydrocarbon fumes.”

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“Prior to the receivership, the Company had redesigned the penthouses on floors 15 and 16, from six two storey units to four two storey units. As a result of these changes, the permitted Floor Space Ratio (”FSR”) has been exceeded by 405 square feet and the total number of units reduced from 192 to 190. No application was made to the City of Vancouver to amend the Developments Permit (”DP”) for changes to the penthouses”

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Krrish is right, receivership is essentially repossession by the lender. The lender will then liquidate the project to retrieve their money. This is why they will revoke contracts for the units that were sold to friends and family for less than market value, or charge them the difference if they want to keep the unit.

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At the end of the day, the buyers are screwed!

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