Friday Free-for-all!
The weekend is nearly here so lets do our regular end of the week news round-up and open topic discussion. Here are a few stories I’ve noticed this week:
-BC housing market ‘on pause‘
-Gas and food costs blamed for RE slowdown
-Assignment deals ‘still available‘
-Realtor fired for false statements
-Shaky markets make retirees nervous
-US trouble rains on our parade
-Hundreds indicted in US mortgage fraud
-UK house prices will fall by 30%
-Really, really, really easy credit
-Condo bust draws scams and squatters
-Brace for global stock and credit crash
-Write downs may reach $1.3 trillion
So what are you seeing out there? Post your news, links and anecdotes here and have a great weekend!
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June 23rd, 2008 at 12:30 pm
Gregor’s ideas are causing reactions (positive and negative) and are leading to debate. Few BC politicians are capable of this anymore.
June 23rd, 2008 at 12:03 pm
Re: MLS#V708346 “100k+ price drop” …
I know that building – it’s a co-op requiring 35% down w/ no rentals/pets/etc … no wonder.
June 23rd, 2008 at 8:55 am
Here was my morning smile:
Realtors enlisted in crime fight
http://vancouver.24hrs.ca/News.....6-sun.html
kinda like getting the fox to guard the chickens
June 23rd, 2008 at 8:47 am
More demand for lumber upcoming, back to work for the forestry workers.
Keep dreaming. There’s cut lumber stacked to the sky already in US lumberyards, as Canadian companies cut & exported like crazy the last couple of years to avoid (a)changes to softwood tariffs and (b)encroaching pine beetles.
Forestry workers are already applying for $11/hr jobs at Home Hardware and Rona, and they’ll be lucky to get them or to keep them when the recession/housing crash hits BC next year.
June 23rd, 2008 at 8:29 am
re: the article in the province – It sure feels like Derek Moscato just surfed the web for a couple hours and cranked that nugget out.
I think he could have done a better explanation of why people (speculators/bulls/and bears) are against the tax – more than enough discussion was done here.
Maybe he wasn’t referencing this website.
That 18000 empty condo number is still floating around – did bc hydro ever return with a real answer on that? The reporters are the one’s who should really be chasing and referencing such info.
June 23rd, 2008 at 7:20 am
Good, affordable sushi…I’m just saying…
June 23rd, 2008 at 6:54 am
one that could sully the city’s reputation
Reputation for what exactly? Having the most overpriced real estate? I could do without that.
Frankly IMHO the only positive aspects of Vancouver compared with other Canadian cities are the things neither government nor business have anything to do with – the mountains, sea, and mild weather. What other pluses are there exactly?
June 23rd, 2008 at 6:37 am
The blog was mentioned in the paper again! Regarding Robertson’s tax idea on empty homes. Here’s the link:
http://www.canada.com/theprovi.....268b096acf
Excerpt:
“On some real-estate blogs and Internet forums, his plan has been panned by investors as everything from a ‘desperate populist campaign promise’ to ‘one of the dumbest ideas ever.’
While their tone might be unfairly harsh, they are right about one thing: This penalty against speculators represents another blatant tax grab — one that could sully the city’s reputation.”
Congratulations to all who voiced their opinion on this subject!
June 23rd, 2008 at 6:13 am
Ouch comment#185 you were logged on to different forum buddy!
This is vancouvercondo.info-Vancouver,B.C. definitley wrong forum to post,please go and find california wildfireblogs.net or sandiegodestroyedhomes.help
Thanking you in advance
NETCOPS
June 23rd, 2008 at 3:34 am
I’m happy with all the forest fires in California and the flooding in the midwest, all those homes destroyed will need to be rebuilt
There are far more vacant houses in San Diego than were destroyed in the fires. And I don’t expect any imminent construction boom in Des Moines, etc, either – there is a lot of excess inventory even in the midwest. Even if every house in those areas was rebuilt, it would still only be a blip.
The US housing market is not going to turn around for 20 years. There are a lot of boomers sitting in big houses that are going to have to be sold over that time, and there is not going to be anyone around able to pay big money for them.
June 22nd, 2008 at 11:11 pm
“I never would have predicted–that we would have 4% unemployment, rising inflation and STILL have low interest rates. So that’s now lasted for 3 or 4 years”
That’s mean you were wrong for four consecutive years that’s good enough to make atleast 80,000 buyers and sellers sit outside the market or send some of them out of city or gift them rental life forever because since than affordability eroded and market appreciated by almost 90%.
Now if some one followed your recomendation in the past they must pay 90% extra to get in the market plus the commission they had to pay to realtors.
“If we do see inflation high enough to deflate the real value of mortage debt, then we will see mortgage rates north of 8%. We’ll see what 8% mortgage rates do to the ‘building equity’ schtick.”
Based on your past performance of prediction and analysis your “if” and “then” can take for ever.
means more will be priced out- so stop annoying to hard working people let them buy and let them become home owner.
June 22nd, 2008 at 10:14 pm
the bubble popped april 26th, 2008.
i cannot think of one RATIONAL reason to purchase residential real estate TODAY.
June 22nd, 2008 at 9:21 pm
My opinion is that it is always a good time to buy if you: a.are rich; b. have so much money you don’t care about depreciating assets ; c. are so rich you can weather any economic storm; d. like the place.
June 22nd, 2008 at 5:28 pm
FW
“…the demand for american cars isn’t there.”
The problem with your point is that “American” cars in Europe (for example) are made in europe!
June 22nd, 2008 at 3:38 pm
No one is Hillary except me. I only lost because I’m a woman, and everyone felt it was time for a black man to have a turn.
I’m not bitter though, I’m still worth millions, and have homes in multiple states. Unlike the bitter bears on here.
June 22nd, 2008 at 2:56 pm
Dave is Hillary. All of his methods and debate points were completely and utterly refuted and yet he keeps banging on long after he’s lost the debate he intentionally uses lies, misleading statistics and his methods of data interpretation are considered, “Voodoo Economics” by the economics community. I thought Hillary was an appropriate nickname at that point.
Pretty sad. You guys are getting paranoid and looking weak. Sandbox too small?
June 22nd, 2008 at 12:05 pm
Only in things that have demand and are priced competitively, if there’s isn’t demand then their new reduced price doesn’t matter.
If you need to rebuild a home you need lumber, that demand is real and will be meet on the open market.
June 22nd, 2008 at 11:20 am
FW are you trolling or, are you actually that stupid?
US exports have in fact got a lift since their currency has gone down the tube.
June 22nd, 2008 at 11:12 am
Guess the world is out buying american cars since their dollar is 30% down from a couple of years ago. Ummm nope not the case as the demand for american cars isn’t there.
June 22nd, 2008 at 11:04 am
“The companies are just no longer being subsidized by the low dollar.” Which is why our mills shut down, where do you think the 20 % differance in cost to produce lumber comes from? The companies profit obviously thus only a 20% rollback in wages would brinfg it back to marketable. (Based on an 80 cent Canadian dollar which is the area that lumber companies could at least break even)
June 22nd, 2008 at 10:43 am
Canadian lumber has always been exported in US dollars, the high Canadian dollar doesn’t increase the price we sell it for, the price is controlled by the market. The companies are just no longer being subsidized by the low dollar. WE have the most efficient mills in NA so they can still compete. The problem was a lack of demand, it’s about to rebound very quickly. Watch.
June 22nd, 2008 at 10:20 am
“More demand for lumber upcoming, back to work for the forestry workers.”
No, it doen’t workt that way, the high demand for Canadian lumber was because we had a 65 cent dollar.
June 22nd, 2008 at 10:01 am
I’m happy with all the forest fires in California and the flooding in the midwest, all those homes destroyed will need to be rebuilt. More demand for lumber upcoming, back to work for the forestry workers. This will be almost as good for the industry as the New Orleans hurricane was a couple of years ago. Hurricane season is still coming too so it can be a very good year after all.
June 22nd, 2008 at 10:00 am
We’ll see what 8% mortgage rates do to the ‘building equity’ schtick.
this is the disconnect that i see in dave’s argument…..
how to “build equity’ after paying too
much for a depreciating asset with borrowed money…..
every month you lose $5000 while you are struggling to buy down your mortgage by $500…
the only winners are the RE agent and the mortgage broker who ’snookered” you into the deal
“now is good time to buy” indeed
June 22nd, 2008 at 9:20 am
“Who’s Hillary?”
Dave is Hillary. All of his methods and debate points were completely and utterly refuted and yet he keeps banging on long after he’s lost the debate he intentionally uses lies, misleading statistics and his methods of data interpretation are considered, “Voodoo Economics” by the economics community. I thought Hillary was an appropriate nickname at that point.
June 22nd, 2008 at 8:54 am
““Rather, things get better over time as inflation increases your wages and as you build equity.”
Here’s the thing. One can’t expect 2-4% inflation to co-exist with a 3% bank of Canada rate forever.
Looking back, that is something in 2005 I never would have predicted–that we would have 4% unemployment, rising inflation and STILL have low interest rates. So that’s now lasted for 3 or 4 years. It will not last forever.
If we do see inflation high enough to deflate the real value of mortage debt, then we will see mortgage rates north of 8%. We’ll see what 8% mortgage rates do to the ‘building equity’ schtick.
June 22nd, 2008 at 8:33 am
“Rather, things get better over time as inflation increases your wages and as you build equity.”
As long as you have a job. Everyone thinks they’re immune to job loss but we know for certain many won’t be. BTW the Relitters still relitting are now looking at a 30% pay cut this year. Construction workers will be about 12-18 months behind. Negative inflation negatively increasing wages I guess.
June 22nd, 2008 at 8:22 am
“Can local income levels support further price increases?”
I’ll leave that decision to the banks. Who am I to say?
June 22nd, 2008 at 7:20 am
“Who’s Hillary?”
Drachen’s husband!
Mold city,you have missed another 25m jackpot on saturday please try your luck again till then keep on sucking.
June 22nd, 2008 at 2:21 am
Who’s Hillary?
June 22nd, 2008 at 1:02 am
Here’s my guess: You work for the CMHC.
Although I think the CMHC is responsible for propelling the Vancouver bubble to the it’s current heights thanks to it’s encouragement of zero down/ 40 year mortgages, I don’t think it has any motivation to encourage the bubble past this point.
I think it’s much more likely that dave works for a mortgage broker.
June 22nd, 2008 at 12:50 am
How can somebody who doesn’t live in Vancouver appreciate that it’s the best place on earth?
Clearly a very good point.
Could you really know that Nortel was the Best investment on Earth if you didn’t work for Nortel?
June 22nd, 2008 at 12:47 am
Thank you Patriotz. Such a simple point, but apparently not obvious to everyone taking part in today’s market.
You control the price you pay
Just because a market can be a good investment doesn’t mean it’s worth paying any price to acquire. Use common sense.
Can local income levels support further price increases?
June 22nd, 2008 at 12:43 am
Nyah, what does that Shiller guy know anyway? How can somebody who doesn’t live in Vancouver appreciate that it’s the best place on earth?
June 22nd, 2008 at 12:39 am
Ohhhh Shiiiiittt..
Is it good or bad that thats old news? If prices are stupid and get stupider does that make us a safer or riskier market?
June 22nd, 2008 at 12:37 am
Interestingly, I do not think RE is a poor investment at all, and I have done well buying and selling homes over the last ten years.
We don’t either. We just think it’s a poor investment at today’s prices.
The one thing Warren Buffett does is that he controls the one and only thing any investor has control of in any investment transaction: the price he pays.
Buffett is as clear in writing as he is in person: “The critical investment factor is determining the intrinsic value of a business and paying a fair or bargain price.”
Did you catch that?
http://www.dailywealth.com/arc.....dec_28.asp
June 22nd, 2008 at 12:24 am
Brown/Thumbs/Krissh, I would really appreciate if you consider doing either of the following:
a.) Learn to communicate so your argument can be comprehended by the average English speaker.
or:
b.) Fuck off
June 22nd, 2008 at 12:11 am
“My opinion is that it is always a good time to buy if you: a. can afford it; b. plan to own for a least a moderate term (5 years); c. have economic stability; and, d. have found a product you desire. If you meet all those metrics, then a potential downturn has no effect on you. ”
Uhh, Okay so all you need now is 10,000 morons who make $600K a year to qualify for all these new units that’re about to hit the market.
Thats okay right? If not then there is a big problem that one crazed warehouse worker will be unable to counteract no matter how many names and rants he uses on this one blog
June 22nd, 2008 at 12:02 am
Nice try at guessing my profession, but once again the speculation is wrong. Definitely not a realtor.
I believe that you aren’t a realtor. Here’s my guess: You work for the CMHC. Do I get win a prize?
June 22nd, 2008 at 12:01 am
There are still some good deals out there with good cap rates.
Are you referring to Phoenix Arizona or is there somewhere in BC that Isn’t overly bubble-priced and would be protected from an impending downturn?
June 21st, 2008 at 11:42 pm
If interest rates begin to climb I simply cash out my investments and become mortgage free again pocketing the difference I’ve made.
I guess the question is this: will the water boil fast enough that you notice? Many frogs in the US were convinced the water was getting warmer only temporarily – the turnaround would happen any minute and house prices would start going up soon.
Right now markets are very volatile. I notice that one of the stories linked here is about a warning for a global credit and stock market crash. At the same time the fear of inflation keeps rearing its ugly head – note the recent ’surprise’ that the central bank didn’t lower interest rates… What happens when rates start to rise? What if this happens at the same time markets take a dive? Just how diversified are you?
I’m curious if anyone has a link to a long term interest rate chart. What does that cycle look like? I know we’re not far from the trough of historically low rates and that we came from a high of around 20% in the early eighties so it took at least 20 years to hit a low for interest rates on this most recent cycle. Are there any long term studies on interest rates?
June 21st, 2008 at 11:29 pm
WTF. If you have a house and an income that’s not enough?
Of course that’s enough – unless of course you don’t actually own the house. If you owe more than you own and are relying on that income than you’re vulnerable to a downturn, job loss, etc.
The very nature of ‘unexpected’ setbacks is that they are unexpected right?
June 21st, 2008 at 11:21 pm
“Robert Shiller successfully called the technology bubble, and then went on to successfully call the US housing crash.”
There are some facts to find out bubble but proffesors analogy is not really open to public,at the time of california crash one of our poster(JADE EAST)pointed out about documentary suppose to be telecast that night.
In the very begining of docomentary proffessor goes tricky way”THREAT OF TERRORISM AND EARTH QUAKE GOT CONNECTED WITH SUBPRIME”you guys might have heard about all those etc.etc. reason about usa like hurricanes and blah blah.
What we got here so far is an issue of AFFORDABILITY miner panic of negetivity(specially from bears on the blogs) of downturn from south of border which did not show up in rebgv stats so far.
From they example of Shiller we can’t even take his own word for the same reason he has mention in his analogy,think about it?
Un employement rates are historically low
increased population(Immigration+Migration)
increased income for lots
low interest rates
no natural disaster or threat of evils.
less supply check post#88
incresing rental stress every month.
Best above the all Vancouver house prices were historic low around 2004 they had corrected up words becasue we are actually residence of beautiful city and our place is
“THE BEST PLACE ON EARTH”-we deserve the lift up and for the next round-after the break.
“there are lots of cities in the usa where prices are still up on what ever pace.”-there is something that proffesor can change for every thing else there is Vancouver “a bubble less city on earth”.
June 21st, 2008 at 10:21 pm
Robert Shiller posted a fascinating article in the NYT in May discussing how even highly educated and skilled people miss the signs of a bubble: http://www.nytimes.com/2008/03.....amp;st=nyt
The basic idea is that, because it’s hard (impossible, perhaps) to get a good idea of what all the participants in a market are thinking, we tend to rely on the advice of others. Even learned economists do this – they survey people to find out about their buying intentions, for example.
The problem is that since the people supplying the information themselves have only a fuzzy idea about the market, combining all this fuzzy information does not necessarily provide a clear picture of what’s going on.
Yet, when faced with uncertainty, as humans we tend to side with the advice that others provide to us. After all, imagine us running around in the forest thousands of years ago. Back when we were hunter-gatherers, it made a great deal of sense to trust your friend who said the berries in the field over there are good to eat. Trusting the advice of others confers an advantage.
If your neighbour just paid a great deal for a house, it tends to validate that the price your neighbour paid was the right price — even if it was really too high. So you choose to pay a high price as well. When you hear of your co-worker who just scored a $50K gain on a condo in Port Moody, it further validates that there must be something right about the prices people are paying – even if they seem too high.
Here’s an example from the article:
Suppose houses are really of low investment value, but the first person to make a decision reaches the wrong conclusion (which happens, as we have assumed, 40 percent of the time). The first person, A, pays a high price for a home, thus signaling to others that houses are a good investment.
The second person, B, has no problem if his own data seem to confirm the information provided by A’s willingness to pay a high price. But B faces a quandary if his own information seems to contradict A’s judgment. In that case, B would conclude that he has no worthwhile information, and so he must make an arbitrary decision — say, by flipping a coin to decide whether to buy a house.
The result is that even if houses are of low investment value, we may now have two people who make purchasing decisions that reveal their conclusion that houses are a good investment.
—
By the way, Realtors and “bulls,” this isn’t just mindless commentary. Robert Shiller successfully called the technology bubble, and then went on to successfully call the US housing crash. And as others have pointed out, he once called Vancouver “the bubbliest city in the world.”
I rest my case. Homes are fucked. Back to the rate of inflation we go…
June 21st, 2008 at 10:20 pm
It is indeed always a good time to buy if you are….
1.Buyer between age 19 to 35 year of age.
2.Are able to pay monthly payment for the term.
3.Long term investor
4.Buying as principle residence.
5.Picking up suitable location.
6.When interest rates are historic low.
Affordability can’t be better than what it could be in the above circumastances.just wondering about those people who were selling in a fear and those who are selling in a fear. would they ever be able to return back?
let’s check some examples.
1.Strataman sold his house in 2005 in fear of crash,approximately-7.5% realtors commission.
2.Crabman sold his appartment in 2006 in fear of crash
approximately-7.5% realtors commission.
3.Brittanny sold her house last year in fear of crash little under the list-7.5% realtors commission.
4.Damann sold his house in 2008 little bit under the list-7.5% realtors commission.
First of all they have lost the oppertunity to be called first time buyer they might have to pay more on taxes if they like to buy again.secondly they are all banking on a crash. in my understanding they will not get a penny in bargain to reach up to their level of year when they have sold their homes.Then their age won’t be same to handel the debt.I think strataman is 55 year old now it’s been almost three year since he sold his house.