Friday Free-for-all!
It’s friday and that means it’s time for our weekly news roundup and open topic discussion for the weekend. As I post this rain is falling against my window and it feels like its been gray and under 10 degrees for a week. I am assured summer is still scheduled to begin in a couple of weeks. In any case its the perfect weather to be stuck indoors in front of a computer - here’s a few stories I’ve noticed this week:
-BC: highest proportion of income on housing
-For Sale: $1,600,000 or best offer
-Lower mainland cities like to spend
-Real estate market returning to ‘normal levels‘
-Boomers own and owe more than ever before
-Sales sign super-stack challenge
-Mohican: shots from the bubblehood
-Cheap Calgarians
-Housing bust a boon for some renters
-US Records: foreclosures and low equity
So what are you seeing out there on this fine spring weekend? Post your news, links and anecdotes here and have an excellent 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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June 6th, 2008 at 5:31 am
http://www.newswire.ca/en/rele.....c7489.html
I got this link from: http://www.greaterfool.ca/
It’s such a fine spin I thought worth sharing.
June 6th, 2008 at 6:10 am
http://tinyurl.com/3ttn88
Lets assume that homes gave back half their price gains (25% drop, ignore effect of compounding). That means that average home equity would roughly half to a little over 30%. The amount household wealth “destroyed” in such a case is mind boggling. It would have a huge impact on our economic well being. The tech collapse didn’t actually hit too hard because actual exposure was quite small. Not in this case. What is wrong with conclusion that we are failing to see the danger? Unless he is factually incorrect that is. What you call alarmist, I call alarming.
Many of the usual suspects had held their usual opinions in that thread. The chickens are coming home to roost.
June 6th, 2008 at 6:11 am
June 6th, 2008 at 6:51 am
http://tinyurl.com/523h63
hmm backyard BBQ and a walk in the park…
just got me some new sandals.. timing is everything!
June 6th, 2008 at 7:50 am
My favourite comments are when a boomer claims she’ll just work until she’s 80 to pay off her extra mortgage. Right. I’ve seen many a sexagenarian attempt this feat, they are the most miserable people that you can imagine working with/for.
I’m surprised that none of the GenXers raised a battle cry to privatize health care just when Boomers are going to need it most to avoid having to pay the massive tax increases that will come along with the need.
June 6th, 2008 at 8:04 am
June 6th, 2008 at 8:20 am
June 6th, 2008 at 8:23 am
over and then decide to buy; after you read a headline, the best time to buy has passed,” cautioned, CREB(R) President, Ed Jensen.
Well gee Ed, thanks for the advice. That is disappointing news, I guess I missed out on my opportunity to get a good deal in the US since I saw those headlines of increasing inventory and decreasing sales TWO YEARS AGO.
June 6th, 2008 at 8:29 am
June 6th, 2008 at 8:30 am
June 6th, 2008 at 8:32 am
June 6th, 2008 at 8:53 am
Screw lower rents and one lousy free month. I want to get PAID to live in one of those crappy places - living there and making sure scavengers don’t steal your copper pipes and aluminum siding and high school kids don’t party and trash the place. Tack that on to your monthly budget expenses.
June 6th, 2008 at 9:05 am
Inventory up:)
June 6th, 2008 at 9:11 am
June 6th, 2008 at 9:33 am
prices have to come down to be affordable.
$250 per sq. ft. is affordable downtown
does this work for you, dosh?
June 6th, 2008 at 9:40 am
Soft Landings for Everyone!
June 6th, 2008 at 9:51 am
June 6th, 2008 at 9:55 am
we paid $243 sq. ft in 2001 pre sale
at $650+ sq. ft. it is not affordable, very few buyers at that level so for sales to continue there has to be a significant drop in prices….
and 2001 pricing is very possible even desirable
just for the affordability aspects….
June 6th, 2008 at 10:03 am
Prove it. Or are you just lying to make yourself feel better?
June 6th, 2008 at 10:06 am
June 6th, 2008 at 10:32 am
“$250 per sq. ft. downtown will never happen. Prices may soften slightly, but you’ll never see a drop like that.”
Same old Dosh. You’ve been around this blog long enough to know our reasons why the prices will fall by that much yet you never once have given any substantiated cogent reason why they would not fall by that much.
Flapping your gums (or fingers) at the problem will not make it go away.
/dev/null
He’s a bias-minded fellow. He’s a real estate agent therefore it is not in any way in his best financial interest for the RE market to collapse. He’s kind of like Wyle E Coyote, hoping to suspend his disbelief and keep the market in the air in spite of the laws of physics. I don’t think he’s stupid so much as wilfully ignorant.
June 6th, 2008 at 10:32 am
http://www.news1130.com/news/l.....12133_3712
June 6th, 2008 at 11:11 am
I’m a boomer who didn’t buy my first home until my late forties. I will have the mortgage paid off before I retire or maybe earlier. My second mortgage, if and when I get one, will be for an income producing revenue property. I can guarantee that it won’t be in BC.
I’m not in the majority, but there are still a lot of us out there who, because we spent years travelling or attending university or just couldn’t afford to buy, didn’t participate in the housing market in the ’80s. We’re mostly women and not fans of the suburban lifestyle so condos are the preferred housing option. We’re not exactly struggling to make mortgage payments because this factor was accounted for when we went shopping for a home.
Here’s my theory. Because of low interest rates and prices in the late ’90s and the early 2000s, you had the children of the early boomers plus boomers who had never been homeowners entering the market at the same time.
This, along with an increasing number of households (smaller households = more households) due to divorce and other lifestyle changes, contributed to the increase in sales and the run up in prices.
Many of the boomer children out there looking for someone to blame for high prices should look across the Sunday dinner table. It just might be their mom.
June 6th, 2008 at 11:34 am
My GenX generation hasn’t had it that bad. Sure our careers aren’t what they could be without the boomers and many of us are not happy with our housing situation. However, we are drowning in little luxuries. We have stuff that most of the world can only dream of.
Most importantly, almost none of us have been asked to make huge sacrifices for our country by going to war. We’ll have a high tax burden in coming years, but we’ll also see improved career opportunities and shockingly cheap real estate. Its up to us how we play it.
A good part of my generation and GenY has decided our fate already. With the internet at our finger-tips, very few of us chose to research the reasons behind high real estate prices. Instead, I’ve known many young adults who’ve obsessively combed the MLS drooling over granite and stainless steel crap.
If we want to blame someone we better look in a mirror.
June 6th, 2008 at 12:15 pm
Maybe but all this means is the echo boomers have “bought” into the ownership story. They can rent for far less than what it costs to own. If they buy now they are speculating or fooling themselves that owning has intangibles that justifies it being more expensive than renting.
June 6th, 2008 at 1:18 pm
June 6th, 2008 at 2:35 pm
June 6th, 2008 at 4:01 pm
June 6th, 2008 at 4:05 pm
June 6th, 2008 at 4:59 pm
http://www.housingwire.com/200.....borrowers/
“Taking California, Florida, Arizona and Nevada together, the four states represented 62 percent of all foreclosures started on prime ARM loans, and 84 percent of the increase in prime ARM foreclosure, Brinkmann noted. ”
June 6th, 2008 at 8:11 pm
June 6th, 2008 at 8:23 pm
Today’s report by the US Labor Dept of the largest monthly unemployment jump in 22 years will further reduce any demand for our lumber along with hopes for a soft landing of our economy.
The RE inventory spike may even become evident on planet dosh.
June 6th, 2008 at 8:59 pm
June 6th, 2008 at 9:12 pm
http://www.nytimes.com/2008/05.....gewanted=1
Also this real time utility for testing Renting vs: Owning figures.
http://www.nytimes.com/2007/04.....HIC.html?#
The interest deductible mortgage that our US friends enjoy seems to have a favourable impact on the owning side.
A Canadian calculator like this sure would be interesting.
June 6th, 2008 at 11:10 pm
June 7th, 2008 at 12:46 am
http://tinyurl.com/599jqw
June 7th, 2008 at 1:18 am
June 7th, 2008 at 1:21 am
Well prices are going to have to drop then, which is what we have been saying all along.
June 7th, 2008 at 6:32 am
Another “meaningless” rise in inventory reported over at Paul’s blog.
Fortunately, there’s a whopping 27% S/L to soak it up.
June 7th, 2008 at 6:38 am
Population: 3.15 million
Listings: 21,232
Ratio: 148
Vancouver
Population: 2.25 million
Listings: 17,857
Ratio: 126
We now have a 15% lower pop/listings ratio than San Diego. (Lower ratios are more of a buyers market.)
June 7th, 2008 at 7:39 am
http://www.monocle.com/Magazin...../issue-05/
June 7th, 2008 at 7:46 am
June 7th, 2008 at 7:56 am
jun that krrish above is not a genuine krrish bears are getting out of whack as prices are countinue going towards space.
June 7th, 2008 at 8:16 am
June 7th, 2008 at 8:19 am
The board does not update solds too often,Sell list ratio is down because of low list=low sales that’s why prices are going UP.
PAUL’B did not go to france,He got another job learning how to drive pallet jack,He is a rockie warehouse worker starting $9.35 per hour- because of less listings and less sales there was no income as real estate rating agent.
June 7th, 2008 at 8:23 am
“bunch of people think the price is going to drop. However, the thing is you guys can’t afford to buy.”
I suppose it never occurred to you that IF you are correct that we can’t afford to buy (a group of mostly very intelligent and educated people who likely earn well above the Vancouver average) then there is no alternative but for the market to correct. If nobody’s left to buy what keeps the prices up?
June 7th, 2008 at 8:28 am
“THERE ARE NOT MUCH LISTINGS IN VANCOUVER
The board does not update solds too often,Sell list ratio is down because of low list=low sales that’s why prices are going UP.”
Umm even if you were correct your reasoning does not explain the inventory spike.
Prices are going up because they’ve been going up for so long and it becomes a habit with consumers/sellers to assume they’ll go up. Happens in every bubble. Think of it like a toy rocket, even after the motor runs out of fuel the rocket will continue to climb for a little while before crashing down to earth. That is where we are right now. Price declines will begin in the summer/fall
June 7th, 2008 at 8:46 am
Oh, and did I mention the open houses? Two weekends ago, we had the surreal experience of going to 4, and being the only ones there.
I’ll admit that this is only anecdotal, based on a small sample (of SFHs only), and in the outlying areas of the GVA…but I can’t help thinking it might be a sign of things to come.
June 7th, 2008 at 9:10 am
“In a democracy, the power isn’t in your hands. Look at the reality.”
What are you talking about? You are conflating democracy with capitalism. Unfortunately typical.
Not that I want to confuse you further, but democracy does not equal possessing commodities. Are you saying that the rule of the moneyed elites is a good thing? When only moneyed interests get a say in how society is run, you’re skirting with fascism brother.
That might be an aspect of our social reality, but I was hoping for a bit more from my neighbors. Potluck anyone?
June 7th, 2008 at 9:19 am
June 7th, 2008 at 9:19 am
June 7th, 2008 at 9:24 am
Chart shows inventory spike to encourage more sellers in fear=more bussiness to stop agent going out of jobs.
June 7th, 2008 at 9:58 am
Population: 2.25 million
Listings: 17,857
Ratio: 126
But that’s the listings for REBGV which does not include N. Delta, Surrey, White Rock or Langley (c/t) (FVREB). Take them out and your population drops to 1.63 million, and the correct ratio is 91. Looks even worse compared to SD’s 148 doesn’t it?
June 7th, 2008 at 10:08 am
June 7th, 2008 at 10:46 am
The slight inventory slowdown at the end of May was actually much less than normal for the Victoria Day long weekend, which is usually the biggest selling time of the year.
Our market has come close to the cliff a couple of times in the last 2 years, only to be revived by greedy idiots and driven to ever greater levels of insanity. But fundamentals have so overwhelmingly deteriorated that the few remaining illiterate bulls at the bottom of the evolution chain will be entirely helpless to stave off the looming disaster.
All the ducks are finally in a row, and we’re a tiny sliver away from panic that will drive inventory to levels that will knock your socks off.
June 7th, 2008 at 11:00 am
June 7th, 2008 at 1:52 pm
I have a place there and on my street there are 5 houses for sale from $399,000 - 549,000 and 3 lots going from $149,900 - 229,900. 8 signs at the bottom of my street has never been seen before!!
June 7th, 2008 at 2:06 pm
June 7th, 2008 at 2:08 pm
Actually, that would have never happened except for what has been referred to as “bankers mischief”. If not for 40 year amorts, zero down, CMHC extension to ‘investment’ properties, this thing would have died the ignomious death it so deserves - at least a year ago. Our financial gurus are enablers.
But, you’re right, ultimately. Greedy idiots…greater levels of insanity.
June 7th, 2008 at 2:40 pm