Friday Free for All!

It’s Friday and you know what that means… It’s open topic time! Here’s a few stories I’ve noticed this week:

-Top 15 real estate myths
-Bequeathing mortgage debt to your kids
-Want a house bargain? Try Kitimat
Century Point New West in receivership?
-Sometimes hard work is not enough
New condos for open air drug & sex market
-The Abbotsford earthquake zone
-Offer $2 for the one dollar Toronto house
-New US home sales slowest since 1991
Global financial crisis is getting worse

What are you all seeing out there these days? Post your news, links, ideas, and anecdotes here and have a great weekend!

note: any conversation on real estate or economics is allowed, please keep it civilized. when posting articles please only quote pertinent points and link to the original instead of pasting the entire article here. Thanks!

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[…] the links at RE Talks, condohype, vancouvercondoinfo & the Sun itself for this […]

disbelief
Guest
disbelief

arrrrr

beatstreet
Guest
beatstreet

It seems average sale price continues to fall along with list. Rob Chipman just posted the latest numbers.

Granted, average sales depends on the sales mix, and the benchmark data will hopefully be out later this week for April to get a better read on things. I used his Feb 23 numbers to see the change over two months:

EndDate Feb-23 Apr-26

ListPri 577,303 534,726 -7.4%

AvSales 567,296 525,618 -7.3%

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[…] in the market. Already, the local blogosphere is buzzing with reaction. Over at the lively Vancouver Condo blog, some commenters were so furious they demanded the article be attributed as a paid […]

homerstreet
Guest
homerstreet

"That’s a multiple of 80 times rent" — not really!?

4 * $900 * 12 = $43,200 rent per year

$290,000 / $43,200 = 6.71 Gross Rent Multiplier

That is a good deal, one I have never seen before. Downtown Vancouvers GRM is round about 19.

patriotz
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patriotz

..if the building has four units renting for $900 a month each, expenses that eat up 50% of your gross income, and a cap rate of 7.5%, you can quickly calculate that you should pay about $290,000 for the building, tops

That's a multiple of 80 times rent, and the bulls think you're nuts to suggest it might go down to 100. Also a four-plex has better fundamentals than a condo (no management ripoff, more land value) so the condo would need to have a lower multiple for the same total return.

blueskies
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blueskies

can't happen here!

http://tinyurl.com/3qumq5

unh unh! nah! no way! never!

digi
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digi

This months issue of 'moneysense' magazine is all about real estate as well. There are some interesting articles in there – the one about how to get rich on real estate goes over cap rates and touches on the issue of rental income and maintenance costs. For anyone in Vancouver the numbers on what it takes to make an investment worthwhile is mindblowing: ..if the building has four units renting for $900 a month each, expenses that eat up 50% of your gross income, and a cap rate of 7.5%, you can quickly calculate that you should pay about $290,000 for the building, tops. If you pay more, it's probably not a good long-term investment. We know what you're thinking: "Where on earth am I going to find a four-plex that's going for less than $300,000?" Certainly not in Vancouver,… Read more »

Patiently Waiting
Guest
Patiently Waiting

Yeah, I really meant potential buyers. You're right, there are no deals right now or for the next couple years.

Anyone here have any good information on the Mosiac townhouse developers? They are building a new project in Coquitlam apparently on spec. I drove by it and the completed pretty on the surface, but the half-built ones seemed like the typical crappy materials.

patriotz
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patriotz

They must think buyers are idiots. Well OK, some are.

No, all are. The smart money isn't buying.

Patiently Waiting
Guest
Patiently Waiting

I'm getting sick of people pricing higher than comps and declaring "seller motivated" or "priced to sell". They must think buyers are idiots. Well OK, some are.

-A-
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-A-

"Comment by Drachen

“They come in three waves,” Balfour told the Georgia Straight in an interview at his home.

I didn’t say that. Please don’t attribute things to me that I didn’t say, I get in enough trouble for the things I DO say"

Sorry Drachen, For the record, it was not Drachen.

It should have read:

Comment by Patiently Waiting

2008-04-27 10:46:26

Drachen
Member

Comment by Drachen

“They come in three waves,” Balfour told the Georgia Straight in an interview at his home.

I didn't say that. Please don't attribute things to me that I didn't say, I get in enough trouble for the things I DO say.

Patiently Waiting
Guest
Patiently Waiting

Yeah, I suspected a hidden agenda.

Later in the article, Balfour says,

"Canada will undoubtedly be asked to take on millions of people as a result of climate change"

Who will "ask" us? Oh, wait a second, I think he might be saying the Americans will head North. Arnie leading a caravan of SUVs from California. Yikes!!!

-A-
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-A-

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Comment by Drachen

“They come in three waves,” Balfour told the Georgia Straight in an interview at his home.

Please tell me this is not the same Balfour as:

http://www.balfourproperties.com/

patriotz
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patriotz

The first is the one that is already happening, where people with money think they are going to find refuge up here. Which has been going on for a generation, during which we have seen a severe bust and a bear market. BTW there are other places rich people can go to you know. The second wave is the middle class thinking they are going to move up to have a better place for their family, and that has started Preposterous. It is the middle class who are leaving, precisely because they can't afford a decent lifestyle for their families here. And then starts the true wave, where you have the refugees arriving with nothing. How do you stop them?” Am I the only one who remembers those rustbuckets that arrived from China, whose passengers (except the ones who slipped… Read more »

Drachen
Member

"I think as Captain of the ship Bob Rennie should be the one that should go down with the ship…"

He's not the captain, nor did he build the ship. He just came up with the slogan, "unsinkable". Our city council, provincial and federal governments are the crew who apparently believe the "unsinkable" line and therefore don't see the need to prepare for icebergs.

I don't think the ship has a captain, maybe that's part of the problem.

Patiently Waiting
Guest
Patiently Waiting

Long term bull argument: Peak Oil Refugees. http://www.straight.com/article-142962/ready-peak… "When Kitsilano-based strategic planner, architect, and peak-oil proponent Richard Balfour talks about environmental refugees, he mentions his own speculation that “20 to 30 million people” could be living in the Georgia Basin in the next 15 to 20 years. “They come in three waves,” Balfour told the Georgia Straight in an interview at his home. “The first is the one that is already happening, where people with money think they are going to find refuge up here. So they are buying up the coast of B.C. and the farmland of the Interior. The second wave is the middle class thinking they are going to move up to have a better place for their family, and that has started. And then starts the true wave, where you have the refugees arriving with nothing.… Read more »

patriotz
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patriotz

I say: While this is true to a certain point, the real reason is that BC has a rent increase cap of 2.5% + rate of inflation!

Wrongo, for the simple reason that Vancouver rents have not even kept up with inflation during the bubble.

See for yourself

I will also note that rent controls exist only for sitting tenants. Landlords can charge whatever they want when a property is for rent. So why are advertised rents so far below (~50%) the carrying costs of the same property? Because that's all the rental market will bear.

Your canard is duck soup, fella.

Disbelief
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Disbelief

I think as Captain of the ship Bob Rennie should be the one that should go down with the ship… And he just might depending how much he has invested in all those buildings he is hocking…. It would be interesting to see what he has invested in. He is probably all out of Vancouver.. He knows exactly when the peak was…

Re-diculous
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Re-diculous

This may be painfully obvious but the "15 myths" – an article I did not read to avoid getting very angry – tells me that things are really slowing down when they are publishing this sort of crap.

disbelief
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disbelief

The very bottom of that Article should have said "paid advertisement by the Rennie Marketing System". Anybody that can see through the blantantly biased report deserves

to go down with the ship IMHO.

disbelief
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disbelief

What is wrong with the blog….

Anonymous
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Anonymous

"In my view the 15 myths of real estate feature is nothing more than a shrouded advertisement, with some of the participants being fully aware, while others were just used as props."

In my mind, you know the gig is up when these "pumping" schemes are used.

-A-
Guest
-A-

IF YOU LIVE BY THE SWORD, YOU DIE BY THE SWORD

Disclaimer: The following is pure conjecture, and opinion I have absolutely no proof, and the readers of this post can do their own reading and draw their own conclusions.

Looks like Rob Chipman inadvertendly became a message mule for the sophisticated Landcor/Vancouver Sun/RE bubble pumpers.

It’s no secrete it's my opinion, Rob is the master of BSology, but the real masters are those who can pull off the scam on the BSers, and not be detected.

In my view the 15 myths of real estate feature is nothing more than a shrouded advertisement, with some of the participants being fully aware, while others were just used as props.