What caused the Vancouver real estate boom?

What are Vancouver house and condo prices so high?

Speculation: Prices are going up, therefore prices will go up. Get in before you’re priced out forever. Its the only way to get really rich without even trying. Prices are practically guaranteed to go up forever. This time its different here.

Pent-up demand: Hey, we’re laid back in BC. We didn’t think about buying until everyone else thought about buying.

Rich Foreigners: We love it, we’ll take two, we don’t care what it costs. Do you have any magic beans for sale? We’re investing in magic beans as well, thats how we got so rich.

Leaky Condos: Its like NEW now! And its cheaper than the others! Lets buy it!

Low interest rates: Heck, the bank’s practically paying us to get rich.

Population growth: Ok, so population growth isn’t so hot. Still, you have to admit SOME people are moving here, just less than before the 90’s correction.

Income growth: Lets see now.. I could take on a paper route, mow a few lawns on the weekend and apply for that night watch job at the construction site.. maybe sell my plasma on the side… Yes, honey, we can make that mortgage payment!

Illegal drugs: Dude! heheh. This condo is wiiiicked! It’s like totally 3D! Quit bogarting the joint, pass the dutchie man! whoa. I can feel the shrooms kicking in, where do I sign?

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118 Responses to “What caused the Vancouver real estate boom?”

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  1. 1

    blueskies Says:Reply to this comment

    This condo is wiiiicked! It’s like totally 3D! Quit bogarting the joint, pass the dutchie man! whoa. I can feel the shrooms kicking in, where do I sign?

    Rennie Marketing :-)

    Current score: 0

  2. 2

    VHB Says:Reply to this comment

    Oh, Pope, you are SO wrong. The data clearly suggest that low interest rates caused 7% and other was 39%. Only someone with a vested interest could make such a mistake. I’m sure Rennie put you up to this–unless you are actually Rennie! I could prove my facts with links, but I’ll just rest on my great authority and assert it.

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  3. 3

    krrish1 Says:Reply to this comment

    VHB,
    what about you accusing some one without anecdotal shhs.
    - yes, I rent.
    - yes, I did not call the top.
    - yes, I did not predict a 7 year boom.
    - yes, I have been wrong before
    - yes, I did quit my blog.
    “Here, tell these people somethin they dont know about me”
    vhb peace out
    VHB
    february 7,2008 at8.36pm

    Current score: 0

  4. 4

    Lager not Logger Says:Reply to this comment

    Just for the sake of clarity Krrish, did YOU predict a 7 year boom? Because if you did that must mean you are a soothsayer and I’d like to know precisely how long this boom will last. Please give us the exact date of the top and the exact date of the next market bottom. Thanks!

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  5. 5

    VHB Says:Reply to this comment

    krrish1: I suggest you see your doctor immediately. It is clear your funny bone is broken. Sheesh. Chill.

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  6. 6

    Anonymous Says:Reply to this comment

    If you laugh you miss out on PROFIT OPPORTUNITY! You must remain focused on task at hand! The best thing to do with a funny bone is have it surgically removed! Your wealthy spoiled heirs will not thank you because they will be too busy snorting coke and driving their Bently into highway medians, but they will appreciate the sacrifice you made. Have your funny bone removed TODAY!

    Current score: 0

  7. 7

    Drachen Says:Reply to this comment

    That’s not all that’s broken…

    Hey VHB, I liked your chipman graph the other day, is there any way you can put some of that stuff on a public blog site? You don’t have to update regularly or allow comments but it’d be nice to have access to some of your useful info from the past.

    Current score: 0

  8. 8

    krrish1 Says:Reply to this comment

    shut up are you blind showing people pop trend till 2006 don’t you know this is year 2008.OPEN your EYES right here and go to see doctor for your self.
    Population

    British columbia
    Total (2007) 4,402,931 (est.)
    GV
    2,116,581( 2006) confirmed
    Vancouver(2007)
    City 611,869

    Metro 2,289,900 (2007)-2,116,581(2006)=what

    future projection

    Population Comparison
    Vancouver City Surrey/White
    2001 578,993 382,350
    2006 618,469 434,431
    2011 655,926 484,225
    2016 683,686 532,034
    2021 707,656 579,802
    2026 726,702 622,523
    2031 741,930 659,560

    *No more land mass *

    2003 - 35,850
    2004 - 39,721
    2005 - 48,444
    2006 - 54,952
    2007 - 54,952 (53% increase over 2003)
    2008 - 56,800 (forecast)

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  9. 9

    Lager not Logger Says:Reply to this comment

    *No more land

    If you have one floor that covers 3000 sq feet and you turn that into 50 floors that cover 3000 sq feet each, what do you call that? Seen all those cranes on the skyline? What do you think they’re doing there? They ain’t just for pretty!

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  10. 10

    krrish1 Says:Reply to this comment

    what happend now are you still eating popcorn trend is your friend hon, trend is your friend, here are the trend here is your friend Krrish1 forever http://www.realtylink.org/hpi/.....YPE=buyers
    you need to take a day off and give your head little rest have a good day.

    Current score: 0

  11. 11

    krrish1 Says:Reply to this comment

    lager,
    I don’t know when I am dealing with main crocodiles why I have to fight with multiple fishes,
    Answer to your question on this point is do your own reserch,I can only answer your question when I will be free.

    Current score: 0

  12. 12

    scullboy Says:Reply to this comment

    Ah krrish, how I love you.

    I said many times you’re our canary in the coal mine, and today you seem a little… humourless. Are you feeling a little lightheaded?

    You having problems making the mortgage payment, buddy? Maybe getting a bit nervous because it’s looking like that ‘investment’ property might not be worth as much as you thought?

    I think it’s safe to say the bitchier our buddy Krrish gets, the further from the top we get in the Van market.

    Love ya, krrish…. see you at the bottom of the curve :)

    Current score: 0

  13. 13

    btk Says:Reply to this comment

    Krrish1, you are missing out on a key point.

    Everyone here wants to read what VHB has to say whereas not one person here cares what you have to say because you’re an idiot.
    The more you write the more you prove this point. So go buy a leaky condo, it’s clearly a great time for you to get in the market, TROLL.

    Current score: 0

  14. 14

    blueskies Says:Reply to this comment

    you’re an idiot.

    nicely put, succinct without the excess verbosity usually found in satv/k/? posts…

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  15. 15

    The Pope Says:Reply to this comment

    Only someone with a vested interest could make such a mistake. I’m sure Rennie put you up to this–unless you are actually Rennie!

    Dag-nabbit Muir! I thought we agreed we wouldn’t reveal each others secret identity!

    I stand by my chart. Those stats are completely accurate and a reliable source to base a buying decision on. I can tell you I went through some considerable discomfort pulling them out though.

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  16. 16

    Anonymous Says:Reply to this comment

    Future population growth….wonder what happens if the U.S. drags Canada into a recession. There goes all those real estate will go up forever predictions.

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  17. 17

    Anonymous Says:Reply to this comment

    “Boom psychology is the egoism that investors get during good times. When that dissipates, it’s bad for the economy.”

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  18. 18

    Anonymous Says:Reply to this comment

    Notice that Krrrsh has tons of time on their hands since they blog so much. If someone thinks real estate is so “hot” wouldn’t they be out buying as many properties as they can, flipping houses, etc. instead of yak, yak, yak on numerous blogs.

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  19. 19

    Anonymous Says:Reply to this comment

    I know people who are investors in the housing market, they don’t have time for blogs.

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  20. 20

    Dosh Says:Reply to this comment

    wonder what happens if the U.S. drags Canada into a recession.

    Not going to happen. IF the US goes into recession it might have an effect back east, but Vancouver is different, our customers are all over the world and we’re not manufacturing widgets. We are a cultural center like New York or London as much as some of the bears here hate to hear that.

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  21. 21

    btk Says:Reply to this comment

    Krrish doesn’t work and he lives with his Mum, sharing a one bedroom apartment, my source, Informer, told me.
    He doesn’t own property, he never has and he never will.
    He also has nothing relevant to offer but he doesn’t let that stop him.

    Once he finally takes the hint he’ll end up posting in a knitters anonymous group, telling them to buy wool before they get priced out forever.

    I know of several people who’ve made money buying and selling wool, the wisemans are all lining up to do it.
    The cost of wool can only go up because of the Olympics and,um, the boomers are getting old and we all know old people like to knit.. buy now or you’ll never be rich.

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  22. 22

    Ignore the Jackass Says:Reply to this comment

    You all give one troll too much attention!

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  23. 23

    Kevin Says:Reply to this comment

    just wondering about the data backing up this chart? how was the chart compiled? i would love to show this to some bulls i know (i am definitely not one of them!), but am interested in the data behind it!

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  24. 24

    jesse Says:Reply to this comment

    I don’t understand where you get these statist…

    Oh… I see what you did there…

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  25. 25

    btk Says:Reply to this comment

    “We are a cultural center like New York or London as much as some of the bears here hate to hear that.”

    Dosh, you would have learned a lot if you got past grade ten.

    B.C.’s industries are forestry, mining, tourism, movies and drugs. These are all dependent on the U.S. you imbecile. When the U.S. put additional tariffs on lumber it really hurt B.C.’s economy.

    Why is Vancouver like New York or London? Because it has streets and buildings too? How does it compare in population? How many corporate head offices are in Vancouver?
    Are you sure it’s not more like Indianapolis or Cleveland? Cleveland also has streets and buildings and people who live there think it’s a great city, just like you.

    Maybe Dosh is just Krissh using spell check.

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  26. 26

    Dosh Says:Reply to this comment

    These stats don’t exist, this chart is misleading. There is no way to track those causes.

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  27. 27

    krrish1 Says:Reply to this comment

    I love you 2 SOFIA but issue was to decide accusation without anecdotal this master can’t show the people what is going on and making fool of people here and there. now you see the trend,future and current projection but master is always confusing people with old date and that is of course here and there.

    I will teach him economy some time in my free time

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  28. 28

    krrish1 Says:Reply to this comment

    well said the pope, I beleive you that’s why i went farther to make the picture clear.

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  29. 29

    krrish1 Says:Reply to this comment

    Excellent Climactic Conclusion

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  30. 30

    krrish1 Says:Reply to this comment

    yep and then cry for affordability right?

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  31. 31

    dingus Says:Reply to this comment

    “just wondering about the data”

    “this chart is misleading”

    Holy man

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  32. 32

    Tony Danza Says:Reply to this comment

    Krish, Just pay attention to those boxes you move around at work all day, forget about the economy, you might hurt yourself or someone else!!!!

    Current score: 0

  33. 33

    jesse Says:Reply to this comment

    I’m not sure if you’re both being sarcastic or not.

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  34. 34

    krrish1 Says:Reply to this comment

    tony,
    if it good to be an idiot carry on,I am heading for work.

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  35. 35

    jesse Says:Reply to this comment

    Well done, Pope. You did the blogger’s equivalent of farting in a Kindergarten class. Certainly very funny but not everyone “gets” it.

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  36. 36

    blueskies Says:Reply to this comment

    when in doubt slag the competition

    http://tinyurl.com/2b2dp6

    * Much more affordable and luxurious than the newly launched and overpriced Pier development *

    Ask the seller about special payment incentives!

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  37. 37

    Tony Danza Says:Reply to this comment

    Yes Dosh, all of the charts and analysis that you have provided are much more accurate. Thank you for your valuable input!

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  38. 38

    scullboy Says:Reply to this comment

    BWAAHAHAHAHAHAHAHAHAHAHA!

    Dosh, have you ever been east of the Rockies?

    I just got back from NYC. My boyfriend just moved from NYC. I spent 10 years in Toronto, and have travelled.

    Honey. Vancover is NOT a cultural center. There’s a *small* opera here, and a *small* art gallery. I’m sorry but except for Bill Reid, and Douglas Coupland Van really has nothing to offer culturally.

    Look, I hate Toronto and even I would be the first to admit it’s got WAY more culture then Van. So do Montreal, Quebec City and HALIFAX for God’s sake.

    I’m also sorry to tell you this, but Van’s not a particularly cosmopolitan town, either. There are a lot of Asians and Indians here, but that’s it. It’s not really an “all over the world” kind of place.

    You’re right. We don’t fasion widgets for the Americans. Asians do. So… if America goes into recession, and consumers stop buying widgets, what happens to all those “rich foreigners”?

    Sorry buddy, Van’s not a cultural capital, but it’s cute that you and so many others think so. What, exactly makes Vancouver a cultural capital?

    Current score: 0

  39. 39

    scullboy Says:Reply to this comment

    Well it certainly explains a lot of the bullish sentiment, doesn’t it?

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  40. 40

    scullboy Says:Reply to this comment

    A thought just crossed my mind…

    There can’t be a seam of granite in a 1,000 mile radius, what with all the countertops.

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  41. 41

    Visio Says:Reply to this comment

    Vancouver has the second populated downtown inNorth America after Manhatan, with the difference being that there are no business in here … only Shangri’la and leaky condos.

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  42. 42

    Anonymous Says:Reply to this comment

    Stats Can…..

    2006 total B.C. exports to all countries 34,823,150

    2006 total B.C exports to the U.S. 21,297,850

    60% of all B.C. exports go to the U.S.

    75% of all Canadian exports go to the U.S.

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  43. 43

    Anonymous Says:Reply to this comment

    “Vancouver is different, our customers are all over the world”

    BWAAHAHAHAHAHAHAHAHAHAHA!

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  44. 44

    Kevin Says:Reply to this comment

    kidding boys

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  45. 45

    Dosh Says:Reply to this comment

    Those statscan numbers are from 2006 - thats two years ago. Its possible that the ratio of products we sell to the US vs. the rest of the world has changed dramatically in that time.

    Here’s what I know: There is unprecedented demand for real estate in Vancouver and people are still buying. Prices are the highest they’ve ever been and people are still buying. People that ignored the fear and bought have done very well so far.

    Current score: 0

  46. 46

    scullboy Says:Reply to this comment

    Krrish, I have a lot of trouble believing they let you out of the house without a note pinned to your chest.

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  47. 47

    blueskies Says:Reply to this comment

    People that ignored the fear and bought have done very well so far.

    so far….. can it continue?

    OT but i’ve noticed that a lot of metro vancouver young gangsters have opted for the early retirement program….

    Current score: 0

  48. 48

    Tony Danza Says:Reply to this comment

    People that ignored the fear and bought have done very well so far.

    So are you saying that everyone that bought before the run up has sold? How exactly have they done very well? Unless you have the cash in your hands it’s called paper profits. I know many who did VERY well during the dot com boom with employer stock options, I’m sure you can guess how they are doing now.

    Current score: 0

  49. 49

    Tony Danza Says:Reply to this comment

    There is unprecedented demand for real estate in Vancouver and people are still buying.

    Have you listened to Jurock lately? He seems to disagree with you regarding Vancouver condos. Or is he just another bear?

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  50. 50

    jesse Says:Reply to this comment

    I’m sure someone who “ignored the fear” and bought a condo in San Diego in 2005 might paint a different picture. Don’t confuse risk with fear.

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  51. 51

    scullboy Says:Reply to this comment

    That’s a bit like saying people who are alive today are immortal because they haven’t yet died.

    Look pal, everything is cyclical. That includes real estate. You’re so locked into your own mind set, you’ll refute hard data with “it’s possible that”. Don’t you think it would have made headlines if all of a sudden we were selling more lumber to China then we’ve been selling ot the U.S.?

    You’re correct on a few points:

    1) There has been unprecedented demand for RE in Van.

    2) Prices are the highest they’ve ever been.

    However when I look at things like immigration patterns and income levels, it seems pretty clear that the locals have been selling themselves and each other a bill of goods.

    Sooner or later, external factors are going to take their toll. Essentially, the credit crunch and subprime mess mean money is disappearing from the world’s financial systems. Less money in the system means less money to lend out. Less money to lend means fewer people will get mortgages because banks etc need to cover their losses and ensure they have enough capital to maintain liquidity.

    If you think this has nothing to do with Canada, I have four letters for you:

    CIBC.

    Fewer qualified buyers mean fewer buyers.

    Fewer new buyers in the system means reduced demand.

    Reduced demand means the top of the market has been reached, which in turn leaves all those people expecting to profit with 2 options:

    Sell, or hold.

    People don’t overextend themselves buying “investment” properties to hold. Therefore, they will start to sell. And sell and sell and sell, in an ever more desperate attempt to find qualified buyers.

    Instead of buyers chasing sellers, sellers will need to start chasing buyers.

    Got it?

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  52. 52

    johnny33 Says:Reply to this comment

    “when in doubt slag the competition

    http://tinyurl.com/2b2dp6

    * Much more affordable and luxurious than the newly launched and overpriced Pier development *”

    Because $430k for a 1 bedroom ISN’T overpriced? lol…

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  53. 53

    jesse Says:Reply to this comment

    “Its possible that the ratio of products we sell to the US vs. the rest of the world has changed dramatically in that time.”

    Dramatically it has definitely not. Here is a report on exports from BC Stats export site. To quote:

    “The value of BC origin exports has fallen
    5.7% in the first ten months of 2007 compared
    to the January to October period in 2006.”

    Forestry is still 40% of exports. When in a recession this sucks for BC no matter how you spin it.

    Current score: 0

  54. 54

    Anonymous Says:Reply to this comment

    “Those statscan numbers are from 2006 - thats two years ago. Its possible that the ratio of products we sell to the US vs. the rest of the world has changed dramatically in that time.”

    Obvious you don’t know how Stats Can reporting works. Really in one year you think B.C. is exporting more to other countries than the U.S. Your imagination is must be working overtime.

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  55. 55

    Anonymous Says:Reply to this comment

    The U.S. is has the biggest consumption rate in the world 70% of GDP., they do not called it an Economic Superpower for no reason. If the U.S. goes into recession, it will drag down/slowdown the economy of every other country in the world. Including India and China who depends on exports. No demand, little exports.

    Current score: 0

  56. 56

    Tony Danza Says:Reply to this comment

    Right now shut up and stack those boxes!

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  57. 57

    Mold City Says:Reply to this comment

    Its funny that some people seem to think that because things take time that means they will never happen. How many articles do you see these days taking the theory of ‘decoupling’ seriously? Our forestry industry is shutting down, the dollar is up (bad for exports) and our biggest trading partner looks to be entering a recession. This does not bode well for our economy.

    But that doesn’t mean you’re going to see a change right away in a big illiquid market like housing. It takes a while for those changes to roll downhill, just like it takes a while for a rebound to start benefiting the general population once we’ve hit bottom.

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  58. 58

    Snark Says:Reply to this comment

    Not to get too picky with the chart but I bet low interest rates played a much bigger part in the boom.

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  59. 59

    scullboy Says:Reply to this comment

    But…but…China has the ocean! And Mountains! And the Olympics!

    Sorry, couldn’t resist….

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  60. 60

    Drachen Says:Reply to this comment

    Scullboy

    “That’s a bit like saying people who are alive today are immortal because they haven’t yet died.”

    Hey man, that’s MY line!

    Dosh

    “Those statscan numbers are from 2006 - thats two years ago. Its possible that the ratio of products we sell to the US vs. the rest of the world has changed dramatically in that time.”

    Way to deny reality buddy. When the statistics and what you WANT to be true disagree find a way to discredit the stats.

    As I’ve said in the past it’s POSSIBLE that little green men from Uranus will come and start some bidding wars with their planet made of gold which will continue driving prices up for another 100 years. But it’s about as likely as a massive shift in BC’s economy that NOBODY AT ALL HAS NOTICED! That would be like moving BC place to Halifax without anyone noticing, such a drastic shift as you propose would have been covered by SOMEBODY you moron!

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