Friday Free-for-all! Holiday Edition
Not only have you made it to the end of another work week, but you’re looking at a long weekend! Here’s a round up of a few news stories I’ve noticed this week:
-July 2008: Sales down, listings up
-Whistler is running out of Gas
-New Pattullo Bridge will have toll
-Bad realtors getting spanked
-CMHC expands bond program for banks
-GDP drop ‘a bit of a shocker‘
-Greenspan: US on ‘brink of recession‘
So what are you seeing out there? Post your news, links and anecdotes here and have an excellent long weekend!
note: any conversation on Vancouver, 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. Pasting a link will automatically create a clickable hot-link. Thanks!
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August 4th, 2008 at 7:36 pm
I agree, hence my offer to provide proof.
I would be glad to meet anybody for some hand picked fresh Guatamalan coffee right here in Victoria.
August 4th, 2008 at 4:57 pm
“Mortgage brokers and real estate agents that do development are like drug dealers who do their own product.”
Worse in a way. If things go to hell not only does the RE professional suffer on the job front but they have an over leveraged portfolio who’s value is dropping like a stone.
Drugs are where it’s at, you can always count on stable or increasing prices (take note Krrish, this could be your next great investment opportunity!).
August 4th, 2008 at 4:50 pm
“Even Drachen believes me.”
Yeah, I think Krrish/Thumbsup has got everyone here jittery with his constant handle switching and occasional conversations between handles. I propose to everyone here that we simply apply a modified Turing test in the future. ie. If you cannot definitively say that two handles belong to the same person they are for all intents and purposes two separate people. There is really no point in debating it.
August 4th, 2008 at 2:44 pm
LOL. What advice? How to make money in a boom market? Because that’s all you know. But you’re about to get quite an education in bear markets, and the cost will make your student loan debt seem cheap in comparison.
Speaking of which: psych always attracts the flakes; no surprise considering how dysfunctionally ‘the source’ has represented himself here.
August 4th, 2008 at 12:13 pm
It’s clearly him and he could be Krissh too
August 4th, 2008 at 9:33 am
“The “U.S. crash” is not countrywide. Out of 150 major markets, some 72 are still rising in value.”
Of the 20 Case-Shiller markets, all 20 are down (YOY). But according to Fuzzie, half of all US markets are up!
Between 1988 and 1992, prices in San Diego dropped 35 per cent — since then, they rose by 410 per cent.
Back to Case-Shiller: San Diego actually bottomed in 1996 at 71.22. Today it sits at 178 (and falling) for an increase of 150%. I guess Fuzzie forgot to tell us his margin of error of 260%!
August 4th, 2008 at 7:31 am
Again, I am willing to prove it. So far, no takers.
August 3rd, 2008 at 10:20 pm
Mortgage brokers and real estate agents that do development are like drug dealers who do their own product.
What I don’t understand, is how can mortgage brokers get sucked in? I can understand real estate agents b/c they start believing their own BS. But mortgage brokers should realize the market is turning when NO reputable bank will touch broker deals anymore.
August 3rd, 2008 at 10:14 pm
This actually made me laugh out loud. None of the big five banks are doing much financing for ANYBODY right now, especially not for amateurs who jumped on the bandwagon way too late. Dave, I suggest you try the credit unions first, although even they seem to be realising they’re going to get murdered when the market turns.
Maybe some of the mezz debt lenders would be willing to take a chance on you, but they will charge you 18% interest and a 4% fee.
Btw, since you’re doing a “land assembly”, I would bet a lot that your property is out in the sticks. I’ll give you some free advice: stop now before it’s too late. I work with experienced developers every day who are panicking now because they can’t sell their product. Sell your land as fast as you can to another sucked, then get yourself a job in something non-real estate, or at least make sure you’re on salary and not commission.
August 3rd, 2008 at 10:01 pm
August 3rd, 2008 at 8:45 pm
http://www.nytimes.com/2008/08.....ref=slogin
August 3rd, 2008 at 8:26 pm
“Dave has a Bacher of Arts with an Hounours Degree in Psychology from UVic”
Pretty hard to go to Uvic without living in Victoria
His race was in July.
No, he had a race in June.
August 3rd, 2008 at 9:58 am
This would be due to increased failures of conditional offers of sale, inspection, and financing. I wonder how much the latter is impacting the success ratio, if at all. What this means is that, if I read these stats properly, the number of accepted (not completed) offers is only down around 20% from last year.
This makes sense — the real estate ladder is leveraged off FTBs and an increased number of failed offers is a corollary to falling sales. Why FTBs are not buying is another question entirely. Likely reasons are tighter lending, demand borrowed from past years, and speculation of future falling prices.
August 3rd, 2008 at 6:47 am
You are using selective reasoning. I am the one who told you I lived in Victoria and Burnaby. If you read Dave 2’s blog, he doesn’t say that he ever lived in Victoria. His race was in July. I am surprised you remembered my race, but it was in June, although I also had one in july but never posted about it.
Again, the offer to meet still stands. Or, I can send you an email of my drivers license, but will block out my last name and address (excluding the Victoria part).
August 3rd, 2008 at 5:51 am
http://tinyurl.com/6mxk64
http://tinyurl.com/6jmfue
August 3rd, 2008 at 4:56 am
August 3rd, 2008 at 12:43 am
In our first five years as rookie real estate investors, we purchased eleven residential investment properties, dealt with a property manager on trial for murder, tenants with knives, fire code inspections leading to court appearances and more. Now, with over 8 years of experience behind us, we’re sharing our stories and giving advice to help other rookie investors avoid the mistakes we’ve made, while enjoying the benefits a good real estate portfolio offers.
Dave and Julie
Julie grew up in a house attached to a small 20 room motel in Bassano, Alberta. Her family has been self-employed and involved in real estate in varying degrees throughout her life, so her interest in all things brick and beam was natural. From land to strip malls to apartment buildings, her family has been involved in many kinds of real estate ownership. Julie furthered her familial real estate experience by completing a Bachelor of Commerce degree from the University of Calgary and obtaining an MBA in Real Estate and Finance from the Schulich School of Business at York University. Since then, Julie’s spent five years working in the commercial real estate industry learning all about the Toronto, Calgary and Vancouver markets. Julie currently lives in Burnaby, BC with Dave and their dog Bram.
Dave grew up in Nanaimo, BC with a fix-it and flip-it real estate family. He bought his first rental property with his Mom over 16 years ago and then reignited his investing once he met Julie 8 years ago. Dave is definitely the more adventurous investor of the two, and plans to tackle development in the near future as he and one partner have begun assembling land for one project. Dave has a Bacher of Arts with an Hounours Degree in Psychology from UVic, as well as a Master of Arts Degree in Applied Social Psychology from the Univesity of Saskatchewan. In 2006, Dave left his job in consumer research and became a residential mortgage broker. In February, 2008 he switched to commercial real estate, and is now learning how to obtain financing for large apartment buildings, regional shopping centers, condo developments and more. Dave currently lives in Burnaby, BC with Julie and their dog Bram
August 3rd, 2008 at 12:38 am
So what does that mean in Vancouver where the rent is about 40% of Manhatten and costs more?
http://www.nytimes.com/2008/08.....d=2&em
August 3rd, 2008 at 12:33 am
http://www.nytimes.com/2008/08.....ref=slogin
There’s also an article in todays NY Times about a glut of 1 bedrooms in Manhatten, which is in a comparable city in New York, New York.
August 2nd, 2008 at 11:37 pm
Scratch that, I mixed up the blog and the website. So this Dave is a mortgage broker? Isn’t that what dev/null independently figured out that the “other” Dave was? Very coincidental.
August 2nd, 2008 at 11:14 pm
Perhaps “The Source” is Julie and Dave is “Dave”. I mean, how many people named Dave have a keen interest in real estate investing, lived in Victoria and Burnaby, and both had races in June? Also, why did the “about us” on the Dave & Julie page suddenly change today?
These are the Daves I know, I know These are the Daves I know These are the Daves I know, I know These are the Daves I know.
August 2nd, 2008 at 9:03 pm
August 2nd, 2008 at 8:12 pm
“Just because I am not as bearish as many folks here does not make me a bull.”
No that’s true. But your conclusions were reached on equally fallacious reasoning as bulls use so you get lumped in with them.
For what it’s worth however I don’t think you’re thumbs or the source.
Thumbsup doesn’t have any concept of logic or proper argument and he’s functionally illiterate.
The source is literate and has an extremely weak grasp of logic but no concept of proper argument.
Dave is literate has a good grasp on proper argument but instead of debating in good faith constantly uses subversive tricks to get his point across instead of assembling a proper argument. I only say he has a good grasp because he breaks the rules so consistently I find it highly unlikely that he’s unaware of them. Grasp of logic is questionable, entirely depends on how much of his rhetoric he actually believes.
August 2nd, 2008 at 8:01 pm
August 2nd, 2008 at 7:58 pm
August 2nd, 2008 at 7:56 pm
Enough with the conspiracies already. It gave me a good laugh, but enough is enough.
August 2nd, 2008 at 7:52 pm
“your version of the transpired events has a little “embellishment” to it…. the way i saw it was drachen wiped up the sidewalk with you…..”
In his world there’s a mysterious SFU study that nobody’s heard of but him and his invisible friend who told him about it, real estate CAN appreciate indefinitely and currently Vancouver real estate is undervalued.
What makes you think he has any sense of reality left?
August 2nd, 2008 at 7:41 pm
you know that eventually you will have your ass handed to you on a platter thus losing any shred of “credibility” you may have ever had…..
Just because I am not as bearish as many folks here does not make me a bull.
I have been consistently calling for a 5% price decline this Fall. I don’t believe prices will fall more than 10%. Nor do I believe they will rise more than 5 to 10% year over year. Basically, I am short term negative (6 to 12 months), medium term neutral (1 to 3 years) and long term bullish (over another decade).
August 2nd, 2008 at 7:40 pm
August 2nd, 2008 at 7:34 pm
August 2nd, 2008 at 7:31 pm
then why are you picking the losing side of the bear/bull debate…
you know that eventually you will have your ass handed to you on a platter thus losing any shred of “credibility” you may have ever had…..
August 2nd, 2008 at 7:16 pm
August 2nd, 2008 at 7:14 pm
August 2nd, 2008 at 7:09 pm
August 2nd, 2008 at 6:39 pm
your version of the transpired events has a little “embellishment” to it…. the way i saw it was drachen wiped up the sidewalk with you…..
August 2nd, 2008 at 6:18 pm
August 2nd, 2008 at 5:31 pm
August 2nd, 2008 at 4:55 pm
A close friend of mine just died of pancreatic cancer. He was a good man. Dave may have issues but that’s uncalled for dude.
August 2nd, 2008 at 4:20 pm
Dave you have registered your name on this site, stop trying to be smart and a retard at the same time.
Your karma will come back to you and you will die of pancreatic cancer
August 2nd, 2008 at 3:01 pm
hick named dave and his hick wife.
Krissh retarded thread jacking doesn’t appear there but we know the source has time to clog up multiple bear blogs at once.
Hmmm
That would be a no. I am not thesource nor am I Krissh.
Believe it or not, Dave is a common name.
August 2nd, 2008 at 2:38 pm
Guys, Dave has a “Bacher of Arts” he knows what he’s talking about OK? Something tells me we’ll see these two bozos on a local news show in a year or two when their projects go into receivership and they’re charged with fraud.
August 2nd, 2008 at 2:26 pm
Right now the owners of units in new building are pressuring the property managers to charge more but are being told to be realistic. In some cases the owners decide they can do it themselves and hit Craigslist for example $1500 one bedrooms in Richmond! and $1850 one bedrooms downtown.
Even then the owners are losing $1500+ per month, if they get their inflated price. More often than not they let it sit for a few months before wising up and asking market rents.
The Rental Market is not tight downtown despite what anyone tells you. You can call any of the property managers in the classifieds and ask to see a suite, apply and have it by the end of this afternoon.
August 2nd, 2008 at 1:56 pm
August 2nd, 2008 at 1:50 pm
At the very beginning of the housing downturn in the US, when sales slowed but prices still rose, rents were still rising — just like here.
Once the housing market downturn hit full swing, however, the subsequent slowdown in the general economy resulted in substantially lower rents. That slowdown is becoming a long-term recession, which will further depress rents.
Same thing will happen here.
August 2nd, 2008 at 1:42 pm
I feel it will drop slightly (< 5%) others feel it will rise slightly. My opinion is based on what cities with similar bubble patterns to Vancouver in the US are experiencing (a 2-3% drop in rents).
August 2nd, 2008 at 12:29 pm
hick named dave and his hick wife.
Krissh retarded thread jacking doesn’t appear there but we know the source has time to clog up multiple bear blogs at once.
Hmmm
August 2nd, 2008 at 11:46 am
August 2nd, 2008 at 11:27 am
20,066 July 31
Listing out of red light area but smart buyers and fool sellers will be countinue right after the break…..
“Main while rental rocket heading towards westside $3000 / 2br - Townhouse - Fairview Slopes (Vancouver Westside)”-catch the best action on vancouver condo-will be countinue……..
August 2nd, 2008 at 9:22 am
In many other markets with similar overbuilding to ours (Miami, parts of California) rents actually dropped significantly from the beginning of the real estate crash. Desperate owners are just trying to get anything they can out of the property and everyone discovers that there are more empty units than anyone realized.
August 2nd, 2008 at 9:17 am
You’re mixing up Dave and The Source. That is The Source’s blog (unless you are proposing that they are the same person).
August 2nd, 2008 at 8:45 am
Fundamentals are so out of wack that rents would have to nearly double before any place I’ve looked at would make sense.
I believe rents are increasing - that’s why I’m a -25% bear.
Others believe rents are static and will stay so - they tend to be -50% bears.
But if you are arguing that prices will stagnate or increase … and assuming you believe there is some relationship in the long-run between rents and prices … then you must believe rents are going to double. And I can’t agree with you there!
August 2nd, 2008 at 6:40 am
bring the price down and you will have better affordability….
prices have to come down
there are no other alternatives
August 2nd, 2008 at 12:28 am
Wow!, I thing that’s my longest post ever on VHB’s Rob’s, Mohican’s (are you really a Mohican) and RET’s blogs.
August 2nd, 2008 at 12:27 am
August 1st, 2008 at 11:44 pm
Here’s the latest installment. I call this piece - Vancouver: The Manhattan of the Pacific Northwest
———————-
Don’t Mistake the Summer Doldrums…
Every year around this time, the market slows to a crawl. The birds are quiet, the heat is on and quite frankly, people have better things to do than buy real estate. (which makes it a great time to buy by the way, since you’ll be the only game in town!)
Every year the numbers for August and July show a slowdown. This year will be no different. Bloggers all over the web use this as ammo for their “end-of-the-world as we know it” blogs. But don’t buy it.
Yes, the market is slowing in a way that’s not related to the summer, because of the US Credit Crunch, inflation and peak oil BUT: That doesn’t mean we’re going to fall like a house of cards. I’ve said it before and I’ll say it again, Vancouver has one of the healthiest markets in the world. Yes, the world. Net-immigration, strong economy, lots of jobs, great weather, Olympic spending by Municipal, Provincial and Federal Governments and quite frankly, value. Affordability is an definitely an issue, but outlying areas still represent great value for your dollar. Yes, not everyone can afford to live in downtown Vancouver, but not everyone can afford to live in Manhattan either. Affordability in itself doesn’t make prices come down.
You can’t paint a stock, or rent out a bond. You can’t refinance a T-Bill, nor can you renovate your RRSP. Real estate is the only investment you can improve with your own hard work and gumption. Home owners have 73% higher net worth than renters and you’ll always need a roof over your head. (As will everybody else; watch those rents rise over the next 6 months!) I for one continue to find great deals for my clients that represent strong long term investments. The underlying market shifts almost daily, but real estate remains one of the most secure places to invest long term.
We won’t know the top or the bottom until a year after the fact, so stop trying to time the market and get in the game!
Thanks for reading, and I welcome your comments, even the nasty ones…
The Harris Real Estate Group
————————
Now listen you “End-of-the-World-As-We-Know-It Bloggers”… you know who you are! You can’t paint a stock! OKAY?! THE DEBATE IS OVER! Shut the blog down, no need for this all to continue. It’s settled! You can’t renovate your RRSP or PAINT YOUR STOCKS! Buy now or die.
Have a great long weekend y’all!
August 1st, 2008 at 10:43 pm
http://revnyou.wordpress.com/
August 1st, 2008 at 10:42 pm
Krissh, this is a blog for you!
Go clog it up
August 1st, 2008 at 10:35 pm
You’ve got some interesting articles on that site of yours.
August 1st, 2008 at 10:29 pm
Long Term tenants $945./month, unaware of sale, great for investment future develop I-2 zoning.
You could be a long term investor with this one… a really really looong term investor.
August 1st, 2008 at 9:48 pm
August 1st, 2008 at 8:18 pm
http://tinyurl.com/trustmeimyourkid
Climate Cops, which encourages children to monitor and report on their domestic energy crimes to their classrooms.
August 1st, 2008 at 7:38 pm
“Drachen, rents have been going up across the board and at rates above inflation. I happen to believe this will continue.”
As I’ve said to you before, it’s better to bring real facts to an argument than made up ones. Go look at a graph. Then come back and say that again.
“Yes, I am sure most people would rather live in a 40 year old building with a pink bathtub and shag carpet rather than live in a high end modern condo. LOL”
Yes, I am sure most people would rather have a landlord who doesn’t know the rules, is likely to try to sell the place from under them and is way too emotionally attached to the property over the peace of living some place where you never even see the landlord unless your rent is over a week late or something needs fixing.
There are arguments for both sides. But as usual you don’t even have black and white vision. Just one colour for you! Anything that doesn’t fit your world view is wrong and should be ignored!
August 1st, 2008 at 7:33 pm
August 1st, 2008 at 7:22 pm
Who cares if the vacancy rate is 0.5% or 1.0%? It’s low no matter how you want to measure it.
Yes, I am sure most people would rather live in a 40 year old building with a pink bathtub and shag carpet rather than live in a high end modern condo. LOL
August 1st, 2008 at 7:21 pm
Ahh, well I see from your website you have no reason at all to be biased in your opinions.
Enjoy bankruptcy dude. Think of it as a zen-like experience where you can get back to the essentials of life and forget about the consumer driven world we live in.
August 1st, 2008 at 7:15 pm
“I think bears tend to be guilty of believing this data when it claims that rents have not risen, and bulls tend to be guilty of believing this data when it claims the vacancy rate is 0%.”
But there’s actually solid logic behind the bear side. If there were a genuine upwards pressure on rents then it would be a Vancouver wide phenomenon and all rentals including the ones studied would rise. However most tenants (this is speculation but I believe it’s accurate) would prefer to live in managed property rather than rent from the owner and managed properties are generally run in a more businesslike fashion so they’re more likely to be occupied than condos and the like, thus skewing the vacancy rate.
August 1st, 2008 at 6:37 pm
I’d consider paying $350/sqft for a unit in there when the time comes.
August 1st, 2008 at 6:27 pm
the source signs off and Krissh pops right up.
hmmmmmmmm
The market is going to go down for decades and TV Towers will become a homeless shelter for all the junkies
August 1st, 2008 at 6:11 pm
From your account to pay increased rent!$3400 / 2br - EXECUTIVE 2 BR SUITE in UBC Chancellors Place (UBC)PostingID: 778516148.
best ever eclipse,best real estate anywhere,month over month year over year,decades after decades ladies and gentlemens vancouver british columbia,“the best place on earth” http://www.istockphoto.com/fil.....id=3725499
MIND IT.
August 1st, 2008 at 6:06 pm
August 1st, 2008 at 6:05 pm
August 1st, 2008 at 5:54 pm
The source: I don’t know what your game is, but you certainly seem to be playing one.
August 1st, 2008 at 5:48 pm
http://www.revnyou.com/About_Us.html
(my site)
August 1st, 2008 at 5:47 pm
August 1st, 2008 at 5:45 pm
I guess since I’m not getting the joke he’s a troll and I didn’t get it until now.
August 1st, 2008 at 5:45 pm
did i say i was a professor? read my posts. in any event, i don’t share my opinions because they’re worth no more than yours.
and yes, i’m working while i do this … i have time to kill while simulations run.
August 1st, 2008 at 5:43 pm
August 1st, 2008 at 5:38 pm
1 Price to rent multiple is bad even when using apples to apples: MLS listing plus Craigslist asking rent for identical/similar unit.
2. Rents increase but mortgage payments stay the same. No argument there. But it isn’t the free ride you make it out to be because inflation is priced into long term rates.
3 The cost of construction does not DIRECTLY influence prices. Second, you forget that a large component of housing (SFH at least) is land. That is where the adjustment will take place if the costs of construction spiral out of control. Overall, the cost plus argument is totally flawed.
August 1st, 2008 at 5:37 pm
August 1st, 2008 at 5:32 pm
Supply and demand.”
You mean the same supply given “how difficult it is to find developable land” (your words), and demand given Vancouver’s population growth, which is only half what it was 15 years ago? Time will tell, but to say there is lots of supply that has kept rents low then turn around and say supply is restricted is too rich.
Add to that the record units under construction and it’s unlikely rents will rise as you say. Construction costs have nothing to do with it. Rent will be based on “supply and demand” so land value plummets to compensate.
This is going to be a 300+ comment weekend at this rate. Let’s hope patriotz and freako don’t show up or we could break 400 easy.
August 1st, 2008 at 5:26 pm
yeah, i’m really interested. it’s a funny thing about academics: we’re curious. that’s why we do research in the first place.
anyway, way to bolster your credibility. good job!
August 1st, 2008 at 5:19 pm
August 1st, 2008 at 5:16 pm
Study after study shows that historically (circa past 40 years) having a variable rate mortgage vs. a 5 year fixed mortgage will save you thousands of dollars in interest approx. 80% of the time. So, no, you are not guaranteed to save money and no, history does not confirm future events, however, it really comes down to your risk tolerance, just like any investment. You also have to be comfortable with your payment (or the amount which goes to principal if your payments are set) going up and down. But, as many have mentioned in this forum, no one can predict the future so rather than guess at what’s going to happen, ask yourself whether you (and your finances) can afford for your variable interest rate (and payment) to go up 1 or 2%? If the answer is yes, and you don’t mind some instability with your payments - go for variable. If not, fix it and forget it!