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July 9th, 2008 at 12:52 pm
Yes, the horse has already bolted, and the retards probably know it — they’re just covering their butts for the coming recriminations by irate tax-paying FBs.
Another analogy: the bubble was already lying dead in its coffin, the govt. has just decided to publicly pound a stake through its heart.
July 9th, 2008 at 12:52 pm
Comments are getting deleted at Globeandmail.com
July 9th, 2008 at 12:50 pm
The maximum amortization is now 35 years instead of 40. Will a 5 year cut make much of a difference?
this opens the door, next up is cutting this back to 30 years and 10% down…..
and (gasp) next stop is 25 years and 15% down
hmmm that sounds vaguely familiar…
July 9th, 2008 at 12:47 pm
Do these retards not realise that the horse has already bolted, and that closing the barn dorr now is going to make fk-all difference….?
July 9th, 2008 at 12:46 pm
Do these retards no realise that the horse has already bolted, and that closing the barn dorr now is going to make fk-all difference….?
July 9th, 2008 at 12:40 pm
Will a 5 year cut make much of a difference?
Sadly, yes. That’s how over-extended these FB’s are on their monthly payments.
Why do you think recent gas prices have turned North America on its head? Because most people can’t afford an extra hundred bucks a month for anything. They’re already in the red every month, tapped out, sinking fast, and even a paltry 5 yrs amortization will make a difference.
July 9th, 2008 at 12:28 pm
Awesome news about the government cutting the am to 35 years. More important though is raising the downpayment to 5%. That will take out tons of speculators.
July 9th, 2008 at 12:25 pm
The maximum amortization is now 35 years instead of 40. Will a 5 year cut make much of a difference?
I guess the amortization cap will prevent further growth of amortization periods (which was unlikely anyway). I suppose the new measures will prevent some buyers from getting financing but it seems not too significant to me.
July 9th, 2008 at 12:22 pm
oops… sorry that link was already posted by anonymous… say, why is the time in the entries an hour behind? maybe the server doesn’t know about DST?
July 9th, 2008 at 12:20 pm
Executive summary: we know the bust is on, and we don’t want to have to fight an election in Quebec and the East over losses by CMHC in bubble markets in the West and Toronto.
July 9th, 2008 at 12:17 pm
now if only they’d prosecute the idiots who thought of it in the first place.
July 9th, 2008 at 12:15 pm
holy schmoley batman! bye bye 40 year mortgages. well, gov’t ones anyway.
July 9th, 2008 at 12:07 pm
Wednesday, July 09, 2008
Government of Canada Moves to Protect, Strengthen Canadian Housing Market
Big news – this is going to put the death nail in the coffin of the Vancouver Real Estate Market and it is exactly the kind of catalyst I thought the market needed to push us over the edge. See the Press Release:
The Government of Canada today announced adjustments to the rules for government guaranteed mortgages aimed at protecting and strengthening the Canadian housing market. The new measures include:
Fixing the maximum amortization period for new government-backed mortgages to 35 years;
Requiring a minimum down payment of five per cent for new government-backed mortgages;
Establishing a consistent minimum credit score requirement; and
Introducing new loan documentation standards.
Today’s announcement marks a responsible and measured approach by the Government to ensure Canada’s housing market remains strong and to reduce the risk of a U.S.-style housing bubble developing in Canada.
The new limits are planned to take effect October 15, 2008. This would allow existing mortgage pre-approvals with the common 90-day duration to be used or expire. Certain exceptions would also be permitted after October 15. The Government will work closely with all stakeholders to ensure timely and effective implementation of these measures.
As these measures relate only to new, government-backed insured mortgages, Canadians who already hold mortgages will not be affected by this announcement.
The measures announced today will build on the strength of Canada’s housing market. According to the International Monetary Fund, the increase in house prices in Canada is based on sound economic factors such as low interest rates, rising incomes and a growing population. A recent Statistics Canada report concluded that home ownership is at record levels, with over two-thirds of Canadians owning their own home.
Mortgage arrears—overdue mortgage payments—have also remained low. In recent years, the percentage of mortgages in arrears for three months or more continues to be at low levels not seen since 1990.
July 9th, 2008 at 12:05 pm
Drachen,
how did you get marry?
hey it’s ok! leak is a part of our life ask Natalie Glebova?
Miss Universe Canada.
July 9th, 2008 at 11:55 am
Haha. How much time do you have left on the lease? If its a year or so maybe you should sell the lease back to him for half the remaining term. You get a few extra grand in your pocket and he can dump the house, everyone wins! (well, except the greater fool if he’s able to find one)
July 9th, 2008 at 11:52 am
Are there any reliable sources of information available to home buyers to determine if a property they are interested in has the potential to require costly maintenance at some point in the future? A list of construction techniques and projected maintenance schedule or problems, for example.
July 9th, 2008 at 11:43 am
A bit off-topic…you know the game is over when your landlord calls you, panicking and informs you he wants to break your lease early and sell. The rush to the exits is here!
July 9th, 2008 at 11:41 am
Mark Xu
“a leaky condo is good news for anyone who owns a non-leaky property.”
Not really, if a condo hasn’t leaked yet it will be assumed (correctly) by the buyer that future leaks are a possibility. Because of that they factor in the possibility of a $100k punch coming in the future and demand a lower price now. On the whole it makes buyers more cautious and tighter with their budgets, driving prices down.
So your supply and demand equation is wrong. Supply may be depressed in the short term (although many residents live in their buildings that are under repair so the impact is not that big) but demand will be negatively impacted for decades.
July 9th, 2008 at 11:40 am
Hey who ever you are bdk or ampa?,
market will never take a downturn just last month west vancouver condo market took 10.7% jump in one month and the sales are picking up where ever people think the affordabilty fit their pockets they are losing no chance like you.
1000 listings are down than last month say thanks to some sellers who are selling under the list to help rookies get in.
Main while rental course is running successfully every where,just few snap shots this same media will be reporting back when their bites across the border will come to an end.
Please note:”This all happened before ten years ago and it’s happening again.”-
LMAO
July 9th, 2008 at 11:32 am
Whats wrong with 1188 Richards? That building was constructed with rainscreen technology, what could possibly go wrong?
July 9th, 2008 at 11:27 am
2-5-10 warranties are worthless if it takes more than a decade for the problems to show.
July 9th, 2008 at 11:18 am
Krissh, why are you posting under so many different names?
FYI there is also a 2-10-10 warranty available but that means nothing. Check out 1188 Richards.
I said it before and I’ll say it again.
This all happened before ten years ago and it’s happening again. The market tanked, the condos leaked only that time there really were asian investors buying units not just suburban warehouse workers.
July 9th, 2008 at 11:09 am
#27
In 2004-2005 government put ban on the matterial that was causing leak and developers are under obligation to provide 2-5-10 warranty there after,so far there is no new case yet the new system is under watch.
July 9th, 2008 at 10:52 am
In 1998 Concord’s sales departement was promoting that they had hired one of Vancouver’s leading rainscreen experts to design the building envelope at the Marinaside Crescent project. I would be interested to know when that same rainscreen technology was first used.
At Marinaside, the strata council soon learned that the building warranty was dependent on performing the required maintenance. However, Concord wouldn’t say what maintenance was required, so the strata had to pay an outside consulting firm $20,000 to provide a maintenance schedule.
It will be interesting to see how newer buildings such as Marinaside fare over time. The strata council there is on top of the required maintenance despite Concord. I’m not aware of any building envelope failures in the newer projects.
July 9th, 2008 at 10:47 am
Mold City,
Thanks for the link and the cat bounce out of milk here!!! read the first comment later.
First of all the bargain is a shift from the sellers trying to cash in aftermath of collapse across the border then read this comment from your link.
BrentThu says:I think there is alot more softening yet to go, at least there better be! I can still by on 06 Escalade in the States for $20,000 less than in Canada, until this is corrected I will be forced to support another country’s economy instead of my own. It is not what I would choose to do, but the automakers made us go south.
this line from the comment“I will be forced to support another country’s economy instead of my own.”-lets say media after boom sign up the next contract-just a thought.
July 9th, 2008 at 10:38 am
“leaky condos are overall a bullish news”
There was lots of news about leaky condos 5-10 year ago, when our RE market was stagnant or falling.
Don’t worry about supply. That’s well taken care of. Notice all the cranes?
July 9th, 2008 at 10:29 am
tell me if cars getting cheaper than decades ago?
Yes they are. American tourism to Canada and consumer confidence aren’t the only things testing new lows, cars are cheaper than they’ve been in 20 years.
insurance to run cars are way more expensive compare to the sq.ft of condo units.
Why don’t you just compare giraffes to lemons, it might make more sense.
July 9th, 2008 at 10:17 am
Guys, leaky condos are overall a bullish news on HOUSING in general, if you believe in supply and demand. Leaky condo= temporarily unavailable condo + construction labor not building new supply. From supply + demand point of view, a leaky condo is good news for anyone who owns a non-leaky property.
July 9th, 2008 at 10:00 am
“We could be set for a really bad downturn.”
Do you think leaky crisis will be over at the bottom?.
Most of cars lost it’s 95% value with in 10 year tell me if cars getting cheaper than decades ago? insurance to run cars are way more expensive compare to the sq.ft of condo units.Does people stop buying cars?
“Vancouver construction quality is a world-class embarrassment.”
Because world is dry,sunny,and stinky!
“The media is made up of people and they are just as inclined to get swept up in manias”
Lots of those idiots also reside in the condo and they are official partners of the developers-may be contracts are expiring now.
“I stopped reading the Sun years ago.”
but start reading blogs
July 9th, 2008 at 9:53 am
Will they try to blame the downturn on leaky condos, not oversupply?
They have to blame anything but the fundamentals, because the fundamentals have been wrong for years, so attributing the downturn to fundamentals would mean admitting that they have been wrong for years.
That’s the “downturn has to be caused by an external event” ideology, which denies that absurd prices could cause their own demise.
July 9th, 2008 at 9:52 am
16Burden of Proof Says:
July 9th, 2008 at 9:04 am
As far as I know, no other city in the world has a leaky condo problem like Vancouver.
////
Actually, Auckland – another bubbly Vancovuer-like city in New Zealand (also another place that vies for the ‘best place on earth’ label) – has a huge leaky house problem at the moment due to dodgy construction over their 8 year boom. They too cry for govt. bailouts. We’re not unique in this.
July 9th, 2008 at 9:21 am
Vancouver construction quality is a world-class embarrassment.
July 9th, 2008 at 9:20 am
The media is made up of people and they are just as inclined to get swept up in manias. Before this report was issued who knew that less than half of the leaky condos in Vancouver had been repaired? Looking at the vast sea of tarps that covered the city over the last 8 years or so wouldn’t you assume the problem was mostly taken care of? The real story was that people were outbidding asking prices on these leakers that just a few years earlier you couldn’t give away.
I think the fact that the media is reporting this story shows they report what they learn rather than making extrapolations. The unfortunate thing is that the HPO and Provincial Government basically tried to hide the extent of this problem, likely for fears of crashing the boom.
Well guess what, the truth eventually comes out and it just so happens that now it comes out at the unfortunate time the market is already starting to collapse. We could be set for a really bad downturn.
July 9th, 2008 at 9:05 am
That’s what steams my clams (no offense, Clam Chowder) – all the negative (or should I say “realistic”) stories about RE the media has been sitting on, or under-reporting for fear of angering their RE Overlords. Now they just “happen” to start trickling out…shoddy construction, organized crime fueling the market, lax lending, etc etc etc – now that the die is cast and it’s too late to do anybody any good.
You’re trying to tell me they didn’t have some inkling stuff like the next leaky condo wave was coming down the pipe a year, two years, three years ago? I stopped reading the Sun years ago.
July 9th, 2008 at 9:04 am
As far as I know, no other city in the world has a leaky condo problem like Vancouver.
Mud huts in Africa are more durable than a vancouver condo. What a joke.
That’s Vancouver for you: world class incompetance.
July 9th, 2008 at 8:37 am
What strange timing for these news stories to come out now as the bubble has just started bursting. Will they try to blame the downturn on leaky condos, not oversupply? It was also all over CKNW this morning, it was all they could talk about for an hour. Has the media turned on the condo market?
July 9th, 2008 at 8:22 am
I used to own a unit at Governors Tower. The real story with the problems there have little to do with maintenance and everything to do with bad envelope design and shoddy workmanship. Concord was warned by their own engineers that the building would leak but chose to ignore them. That’s why they have had to settle with the strata owners. I don’t know what the settlement figure is for Governors Tower (I sold years ago) but I do know that across the street at 389 Drake it was 24 cents on the dollar for the estimated cost of repair. That doesn’t sound like much but it’s about the maximum you can expect in these kinds of cases.
July 9th, 2008 at 6:56 am
This may put some more fear into the smaller pool of potential buyers:
Report: Leaky condo crisis is worse than first estimated
Wednesday, July 09 – 06:15:00 AM
Treena Wood/Vancouver Sun
VANCOUVER (NEWS1130) – The chances are you know someone, or you are someone, who has been affected by BC’s leaky condo crisis. It’s far from over, according to a report published in this morning’s Vancouver Sun.
It estimates there could be 85,000 units leaking, more than the 65,000 estimated by the government.
The consultants who wrote the report for the Homeowner Protection Office say the government still doesn’t know the “full extent” of building envelope failure.
In the worst case scenario, over two-thirds of all the leaky condos in BC still haven’t been fixed.
http://www.news1130.com/news/l.....1459_12992
July 9th, 2008 at 5:49 am
Speaking as an owner in an 8 year old building, we are already encountering idiots who don’t want to spend a little money for some regular maintenance (I think the estimate was around $1m for 290 units). I’d like to know the whole story on those buildings mentioned, but I wouldn’t be surprised if they turned down some recommended maintenance about 7 years ago and now they are paying 10x as much.
Nothing is built perfectly, and you’re always taking a gamble, but when you spot something early, the lesson here is do something about it ASAP.
July 8th, 2008 at 11:46 pm
Eww, look what got into the sidebar
July 8th, 2008 at 11:42 pm
$399900 Foreclosure! Must Sell! Gorgeous 3 bdrm Townhouse! (Surrey, Guildford)
“Only 9 years old, original owner has lovingly cared for this home.”
OK boys and girls, why is a property which has been in the hands of the original owner since 1999 being foreclosed?
No toxic lending here.
July 8th, 2008 at 10:42 pm
There may be some issues around maintenance but there is more to it than that. Concord would not have settled unless they had liability.
I’ve seen more than these two highrises in Yaletown/False Creek covered top to bottom in white vinyl. In some cases it looked more like the exterior brick work had failed. Of course the bricks are not structural but an architectural element.
Almost no one can take a $100k assessment. The one resident they interviewed was very mellow which made me think he hadn’t had to fork over too much money. My guess is Concord paid a very large portion of that contract.
I’m surprised it took so long for the story to make the news, this must have been brewing for couple of years at least.
July 8th, 2008 at 9:56 pm
Just because you can (or think you can) sell something 14 years later for more than you paid for it (net the 100K assessment in this case) does not mean you have made money.
If you have not sold an asset, the money you have made is the net income (revenue – expenses) over the time you have owned it. Appreciation doesn’t count until realized and can go away at any time – like right now.
July 8th, 2008 at 8:33 pm
Probably laughing less the Ronald McDonald or Mr coca Cola at the morons that sent them money and got fat in the process.
Bet you showed Li Kai Shing a thing or two by not buying, even these morons who skimped on their starta fees aren’t doing too bad, I’m sure the appreciation over the last 14yrs might just be alot more then 100K, shows that even morons can make money, only pigs can’t.
July 8th, 2008 at 8:23 pm
I’m sure Li Kai Shing and his Concord Pacific are still laughing at all the morons out there. 320 million for the land and the chance to fleece Vancouver morons for the next 20 years, priceless…….Plus the chance to become the world’s 11th richest man.
July 8th, 2008 at 8:08 pm
The developer doesn’t need to do any maintenance after the fact, it’s the job of the owners to ensure that the maintenance is being done. If you’ve voted to skimp out on services to keep your strata fees low then that’s your own fault.
No diff then if a homeowner decides to push his 25yr roof for an extra 10yrs to save some money. Great, but don’t blame the original roofer when it leaks.
July 8th, 2008 at 8:02 pm
If the Dodge dealer had been doing the maintenance under a contract established before the sale, well yes I think Dodge must suck.
Get the point?
July 8th, 2008 at 7:58 pm
They didn’t properly maintain their curtain wall system by checking seals and recaulking as per standard operating procedure.
This just in, girl buys dodge caravan and engine dies 2yrs later. Dodge must suck, not the fact that she never changed the friggin oil.
July 8th, 2008 at 7:57 pm
Don’t worry patriotz – these days they use performance un-hancing drugs to make sure nothing happens in too much of a rush. I’m sure construction quality during this boom is just fine
July 8th, 2008 at 7:49 pm
Let’s see now, 14 years ago was 1994- why that was right at the top of the previous RE cycle.
Anyone see a pattern here?