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August 24th, 2008 at 11:02 am
There are no more “price reduced” in the Fraser Valley RE ads. Now “NEW PRICE” seems to have replaced it.
August 24th, 2008 at 10:31 am
“Vancouver, London, Chicago Take Note
Similar disappointments are what Vancouver 2010 and London 2012 have to look forward to. Chicago 2016 (a hopeful) should take heed but it won’t. Chicago may be in better shape because the recession is likely to be over by 2016, but I still doubt it would be worth the expense
Many will suffer, few will benefit. Vancouver in particular is unlikely to be prepared for such an outcome. All that glitters is not gold.”
not so fast vancouverites
August 24th, 2008 at 10:11 am
most of the same people convinced that RE only goes up were soundly convinced that 2010 would launch us into an economic nirvana.
Not so! The bubble blowers are under no illusion as to the nature of bubbles. They get paid by boosting, and most are safely out of it by the time the bubble pops. It is naive bubble participants that get burned.
August 24th, 2008 at 10:10 am
There’s some excellent discussion of the Olympic myth over at Mish’s blog, including mention of Vancouver – http://globaleconomicanalysis......-bust.html
August 24th, 2008 at 9:24 am
Alexcanuck: Great summary of the credit shell game. There’s commentary in this weekends globe that helps put the US ‘fiscal gap’ of $70 trillion into perspective:
http://www.reportonbusiness.co.....Blogs/home
To earn $70-trillion in profit, you’d need 1,723 companies the size of ExxonMobil; $70-trillion would be equal to the annual sales at 1.35 million Wal-Mart stores. That’s not the size of the U.S. government’s debt, though. It’s the shortfall between its projected future revenues and what it plans to spend (in today’s dollars).
The US, by the way, is the big country to the south that buys 75% of our exports. Their financial melt-down will burn us bad.
August 24th, 2008 at 9:16 am
http://tinyurl.com/3nmegw
Mish has a great report on what really happened to the Chinese business and RE investors during the games.
Calgary and Montreal got nothing…..so did Beijing. But Vancouver “is” different….right ?
August 24th, 2008 at 8:45 am
Denninger writes a great rant, and his latest is about a debt-fueled party drawing to it’s ugly end.
http://tinyurl.com/3g4ofg
Canada is in much better shape, but only by comparison. And if you think events in the US don’t affect us….. You want to buy some flipped pre-sales?!
August 24th, 2008 at 8:41 am
The whole 2010 thing had a lot of the same boosterism as the RE bubble. In both instances, most of the same people convinced that RE only goes up were soundly convinced that 2010 would launch us into an economic nirvana.
August 24th, 2008 at 8:29 am
Vancouver Crashes Yet Again:
Check your facts re; governments print cheap money. That is a common misperception, during the current “economic miracle” they didn’t have to, instead slashing regulations to allow the “shadow banking system” to create the imaginary dollars to enable this debt-fueled expansion. A lot of those dollars are currently sloshing around the economy, but are supposed to be paid back to entities such as China, Saudi Arabia, large private equity, and so on. This will never happen, only debate left is whether the imaginary dollars disappear via debasement (monetary inflation, as distinct from price inflation) or by massive defaults.
Either way out is painful, and will thoroughly piss off whoever holds that long-term debt, and may well involve the Government starting to print dollars, but up to now has been a very clever shell game, with one real dollar pretending to be under a hundred different shells at once. Borrow and spend! Great way to have a party, and as long as money is being loaned at an ever-increasing rate the party continues. That credit door slammed shut a year ago, (perhaps you’ve heard of the credit crunch?) and I don’t know the next chapter. I’m pretty sure it’s not pretty, but it hasn’t been written yet.
August 24th, 2008 at 3:29 am
buff, you said:
“Vancouver doesn’t seem to be the case despite the “olimpic hype”.”
But, this is the hilarity, even you have the impression that Olympics will bring some economic miracle, you smell the hype .. but would you really believe the Olympics would create non-related jobs in business software development?
The same thinking is responsible for a good chunk of the housing appreciation we saw.
August 24th, 2008 at 3:19 am
buff_butler,
I come and go in Van and can answer …
1) “developer contract positions in vancouver to start out but they seem to be hard to come by for durations over 6 months”
Yes, Van is not a good contracting market. More likely contract-to-hires, but these especially probably don’t pay good rates.
2) “Is the preference out there for salaried positions”
Yes, this is also true in my experience. I’ve worked at places that hate contractors.
3) “Contracting rates”
With the exception of a few bigger companies and some desperate gov’t projects, rates suck so bad that it’s often not worth it to contract.
August 24th, 2008 at 2:49 am
My neighbor just dropped the price of his house by 10% again. His house has been sitting on the market for 4 months now with no takers. It’s the third reduction he has made since listing his house on the market. This market seems to get worse by the minute.
August 24th, 2008 at 1:10 am
Hi arit,
Thanks for your reply,
I had been looking for developer contract positions in vancouver to start out but they seem to be hard to come by for durations over 6 months (aka anything useful). Is the preference out there for salaried positions or is it just the head hunter companies i’m dealing with? If this isn’t the case who do all the government agencies list with? Also the gap between salaried and contract seems quite small wich is strange.
Currently im in edmonton and anyone with ~5 years experience secure a very good contract for 1-2 years. Vancouver doesn’t seem to be the case despite the “olimpic hype”.
Thanks,
buff_butler
August 23rd, 2008 at 7:54 pm
buff_butler
“Are there any readers here that work in the IT industry in Vancouver? ”
Yes, a few… How can we help?
Regards
arit
August 23rd, 2008 at 7:44 pm
Historically tech has been one of the most cyclical industries around.
Tech in Vancouver actually did well during the 1982 recession because of the boost from the introduction of the IBM PC a year before. I mean software for the broad market, not IT departments of local companies.
But the 1982 recession was quite local (western Canada, SW US).
August 23rd, 2008 at 6:38 pm
If us mkt. stay up while they are dealing with terrorism,Vancouver will fly high over mountain.Do you think us will help canada to grow up so they decide to fight terrorism till 2010.So when we have a potential to grow heven high some one is holding our legs like wrestler,what will happen as soon us will with draw from Iraq and Afghan their economy will climb the chart right away but till that time Vancouver will cross 2010(opportunity to grow)then this same no people will bite their nails while looking at us mkt. up BEWARE OF US do not loose golden chance.
Vancouver is beautiful city of the world.Peaceful most advance awesome buses and skytrain convenient,pullution free ,lots of beach,mountains,night life, very creative and cost of living is very high(ICBC and HYDRO is hard to handel monopoly)There is no country in the world have street like Canada world is very congested but not canada these all facts gives Vancouver real estate to grow more as prices over here are still very cheap compare to Chicago,New York,Central London,Hong Kong,Bombay,and New Delhi people have a chance to fill the gap I am sure Vancouver will go up to $1000 squire feet very soon only its taking time to convince people because something new is happening first time people need time to digest
August 23rd, 2008 at 6:32 pm
thanx to bring that forward.anybody should have been ask me frankly. I work for westfair,loblaw,and pc.for bc’s number one billionaire galen weston(canadian)number 2.I get my pay cheque after tax so no scam.
August 23rd, 2008 at 6:20 pm
Price Vancouver never goes downward because any earth making machine. I buy towers tv in order to obtain the rich but market it goes downward so now I idiot
August 23rd, 2008 at 6:10 pm
“Even if wages are a bit better in Canada, some companies may not like the idea of having too much latent uncertainty”
This is true to some extent though often satellite offices have a difficult go of it in terms of lobbying for new projects (not just existing ones). You generally need to bring something more to the table than status quo or the costs and inefficiencies of the remote office are not justified. Nokia basically shut down their San Diego office but kept the Vancouver one; so much for latent uncertainty.
As a comparison, ask a company with employees in Germany how easy it is to lay someone off there.
August 23rd, 2008 at 6:00 pm
Are there any readers here that work in the IT industry in Vancouver? I had thought of moving out there a few times but housing was just to expensive to make sense.
August 23rd, 2008 at 5:00 pm
BS Expert Realtor Says:
“Jesse, February, June, it doesn’t matter, we have the best real estate anywhere.”
The sad part is, that’s not that far off from the truth, if price alone were to equal “best” or “greatest ” for example. We’re in for a treat.
August 23rd, 2008 at 4:33 pm
I have to chime in with one point. A major point of difference between Canada and the US is the fact that we do not have an ‘at will’ form of employment relationship here. For local development studios that operate by fulfilling contracts with publishers, that may not make a difference. But for companies that are actually foreign-owned, it does. At will employment is much less risky and far more predictable from an employer’s standpoint, which is why so many american firms try to use employment contracts that try to replicate the concept here in Canada. (alas for them, the courts don’t take kindly to that).
Even if wages are a bit better in Canada, some companies may not like the idea of having too much latent uncertainty on the human resources front.
This could be a factor in some of the layoffs. I’m not sure, but I thought it was worth mentioning.
August 23rd, 2008 at 4:25 pm
“But, certainly, if the company is based around delivering a product or the product is the core revenue generator for the company, it’s hard to cut.”
Historically tech has been one of the most cyclical industries around. Maybe this time it’s different.
August 23rd, 2008 at 3:54 pm
James, Biff, I believe Biff is correct at least in the area I know, software development, wages look to be around the same in the US as here with the dollar where it is. New York will certainly be more and possibly a couple other markets, but most places are probably similar wages to Vancouver.
James said:
“Also, most IT projects underway or maintenance gigs are revenue critical to businesses.”
This may be true. But, certainly, if the company is based around delivering a product or the product is the core revenue generator for the company, it’s hard to cut. But we’ve just seen 200 let go in this case, who were working on revenue generating products. I personally had a sendoff Friday for a colleague let go from a ‘maintenance gig’, American parent company called and ordered layoffs (not in Van).
but I was originally commenting on what you said here, which was related to companies using IT for non-core needs:
James said:
“Most business apps are about making an enterprise more efficient and saving them money. That’s not exactly the number one thing to slash.”
My point here was that if a business is simply consuming software X and required Developer Y to maintain for some non-core need, then these are ripe for cutting back.
If you are talking about local companies like SAP and Pivotal and the products they produce, I would say in a global downturn, the use of their products around the world might certainly be scaled back around the world, leading to layoffs in Van.
August 23rd, 2008 at 3:52 pm
Le Grand Mensonge,
Can you expand, please?
Wow, things are sure heating up. And across the country it seems. These are very interesting times. The shocking thing, for me at least, is that I still know people that are seriously in the market to buy. I’ve tried to talk them out of it but they simply aren’t willing to listen. They seem to have fallen for the line of BS that renting is throwing away money and that owning will be the financial and emotional manna they have been waiting for. I’ve given up trying to be honest, any mistakes they make are their own fault from here on in.
August 23rd, 2008 at 3:44 pm
Where else do you all think we’ll see job losses in Vancouver? What large companies will run into problems? Perhaps Home Depot and Rona? That’s a toxic combination of retail and construction. Is there any chance that UBC or SFU will start laying off employees due to reduced enrollment?
August 23rd, 2008 at 1:58 pm
What really bugs me about this whole Olympic lie is that the most vulnerable will pay the price.
August 23rd, 2008 at 1:51 pm
Jesse, February, June, it doesn’t matter, we have the best real estate anywhere.
August 23rd, 2008 at 1:23 pm
James, if you look up US IT wages on salary.com you’ll see that with the dollar near par, Canadian IT wages are pretty much equivalent, if not higher.
August 23rd, 2008 at 1:22 pm
But of more than 20,000 apartments posted for short-term rent, only 8,000 were leased during the Games, it said.
And remember folks, that’s the summer Olympics, the big one. How many do you think will be rented out here for 2010?
August 23rd, 2008 at 1:11 pm
“‘Everybody thought the Olympics would be great for business,’ he said. ‘It turned out differently.’”
So short-sighted. We all know the Olympics will pay back in tourism revenue for decades to come after the world sees what a great place Vancouver is. This comes from watching the biathalon and speed skating. Add to that all the rich Asians that will come just for the Olympics and decide to move here with all their money. I can’t think of a better time of year than February to showcase Vancouver and all it has to offer, especially the beaches. Ski one minute, go for a dip in the ocean the next.
August 23rd, 2008 at 12:42 pm
From the LA Times re. Olympic let-down in Beijing (edited here for brevity):
“Many in Beijing were counting on a tourism bonanza, but it didn’t happen.
Li Qiang…expected his Sichuan restaurant, a couple of miles from the Olympic village, to be packed with tourists during the Games. But it’s been unusually quiet. One day this week, business was so slow that Li let two of his seven staff members go home in the middle of the lunch hour. Three others sat in the corner watching television.
“Everybody thought the Olympics would be great for business,” he said. “It turned out differently.”
Many owners of small restaurants, hotels and shops in Beijing are wearing long faces this summer, especially those who poured their life savings into buying businesses or sprucing up their shops ahead of the Games.
Apartment owners, too, had hoped to cash in on the bonanza, with some jacking rents up to five times normal levels, according to the official New China News Agency. But of more than 20,000 apartments posted for short-term rent, only 8,000 were leased during the Games, it said.
“Business is a little better because of the Olympics but not a whole lot,” said Zhang Yanjuan, a saleswoman at a shop selling fake Polo and Abercrombie & Fitch shirts…”Everybody said that when the Olympics come, we would make a small fortune. But everybody was wrong.”
August 23rd, 2008 at 12:23 pm
I’d be surprised if SAP left Vancouver, wages here are cheap compared to the US. Also, most IT projects underway or maintenance gigs are revenue critical to businesses.
August 23rd, 2008 at 12:21 pm
“Yep, the big five-o. Can’t happen here of course.”
From what I’ve been reading, some areas in California and Florida have passed six-o. Three years ago, most outspoken bears wouldn’t have dared suggest this. This is making it hard to guess the bottom for Vancouver.
August 23rd, 2008 at 11:23 am
James, I am in ‘the biz’ too, but I think you are being a tad optimistic. You have the 100 video game jobs + 100 jobs at fiver media (a Java development shop), ok, maybe absorbable. But, if SAP Businss Object ‘rationalizes’ its workforce and does away with most development in Van., I think this would be a huge supply shock to absorb. Can anyone confirm how many hundreds of employees SAP BO has? A lot of these jobs would be in the 70-100K range, which is actually in the upper deciles of earners.
I also think that ‘business apps’ or any IT that is not revenue critical would for many companies be one of the first considerations for a budget cut.
August 23rd, 2008 at 11:20 am
Here is a clip from BNN on the gaming industry…go to 15:33 minutes.
http://watch.bnn.ca/#clip47152
August 23rd, 2008 at 11:01 am
Vancouver’s still a pretty good job market for software developers even with the game layoffs. Most guys in the business of writing games aren’t all that attractive to business software houses. C++ just isn’t used much outside of mass produced software like games and operating systems etc.
I’d say the IT sector is one sector that will do fine in this whole thing which is cool since I work in the industry. Most business apps are about making an enterprise more efficient and saving them money. That’s not exactly the number one thing to slash.
IT isn’t really deep into construction. Few construction firms use any kind of software other than the shrink wrapped stuff. Banks and investment firms usually have a back office shop of some sort but they’re not into huge projects and all that stuff is run out east anyway. Same deal with retailers.
August 23rd, 2008 at 10:43 am
“Can anyone shed some light on why all these game companies and media companies are getting rid of workers? Is it generally a symptom of a global recession?”
Low-cost entertainment isn’t affected by recessions and depressions.
Radical laid people off because their parent company, Vivendi, merged with Activision to become Activision Blizzard. The new Activision Blizzard wants to focus on games with mega-hit potential, and they didn’t believe Radical’s games all had mega-hit potential. So, Radical canned the projects Activision Blizzard stopped funding.
The high Canadian dollar has an impact on Canadian game companies, especially in Vancouver. Most of the games made in Vancouver are not original IPs. The publisher owns the IP and picks the development studio they believe will do the best job in developing a product using the IP. The developers are completely dependent on the publisher supplying the IP and the money to keep the studio running. If the Canadian dollar is low, the Vancouver studios are more attractive to American publishers because the costs are much lower. Same thing is true in movie and television production.
EA laid off about 100 people in Vancouver in 2005 when their stock took a big dip. Their stock has been stagnant for years, but is on a steady decline this year. If it continues, I expect to see them layoff another 100 or so people in Vancouver (cancelling Yaletown studio is a prime candidate).
August 23rd, 2008 at 9:08 am
In the Ruins of the Housing Bust, the Price of an Illusion
“How long will the economy have to pay the price for that illusion? The experience of Merced, which rose higher and fell faster than nearly anywhere else, suggests that recovery from the national real estate debacle will be painful and protracted.
In the three years since housing peaked here, the median sales price has fallen by 50 percent. There are thousands of foreclosures on the market. The asking prices on those properties are so low that competitive bidding, a hallmark of the boom, is back.”
Yep, the big five-o. Can’t happen here of course.
August 23rd, 2008 at 8:42 am
For a good laugh check out this link:
http://www.canada.com/montreal.....50e553fc43
An economist /RE /Mortgage pimp explains why it’s different in Canada.
But of course it is not, is the commentator stupid or a liar?
August 23rd, 2008 at 8:31 am
Basic stuff, government prints cheap money, which somehow has to be fed into the real economy by way of ultra low interest rates (lower than inflation).
Greater fools borrow the money to buy inflated assets; inflated because it’s faster to inject cheap money into the economy than to build homes, and so for a couple of years there are more fools with money than homes.
Eventually the artificially inflated demand is met with an actual oversupply of homes is created as is the case now.
The crash is in the early stages. It’s not different this time. It never is.
The Real Estate Pimps have pulled it off again in Vancouver, and they will pull it off again in 20 years or so.
August 23rd, 2008 at 4:41 am
It’s a sign of a consumer recession, when J6P runs out of spending money. Any number of indicators show it has arrived in the US in force.
You can also have an investment recession, where business spends less money on new facilities and new products, which is what the dot-com bust of 2000 was.
The upcoming recession actually looks like a combination of consumer and investment (new RE is investment). A double whammy.
August 23rd, 2008 at 1:35 am
Can anyone shed some light on why all these game companies and media companies are getting rid of workers? Is it generally a symptom of a global recession?
August 22nd, 2008 at 10:53 pm
I heard blastradius was doing some downsizing as well – unless the economy picks up we’ll lose some decent paying tech jobs all over.
August 22nd, 2008 at 10:13 pm
“In addition to Radical laying off workers, Riptown (or Fiver Media) has also made redundant 100+ workers. I also hear that Business Objects will soon be packaging off most of the downtown Vancouver operations, except for Sales and IT Operations. Going to be a lot of stretched mortgage payers soon!”
Backbone Entertainment just let go a bunch of people too. There’s a lot of software engineers and artists looking for work right now.
If EA continues it’s slide, expect a round of layoffs early next year.
August 22nd, 2008 at 9:33 pm
There’s a lot of general labourers on construction sites. You know, the guys hired at those storefront offices. I bet this is the source of the pot smoke more than the trades.
August 22nd, 2008 at 9:23 pm
I worked a few years in construction and the only guys I saw sparking up on site were roofers.
No carpenter I EVER worked with would so much as drink a beer before tools were rolled up. It’s too dangerous.
Maybe I worked with different cats, but that’s my experience.
August 22nd, 2008 at 8:59 pm
apoplectic
“get so mad you think you’re gonna burst a blood vessel”
That is value added to me, a new word. Thank you.
August 22nd, 2008 at 8:42 pm
Arit:
I think he meant “apoplectic”, which means “get so mad you think you’re gonna burst a blood vessel”
Imaging being trapped in a room with Satv. Thumbs and / or Rob A. for a week. That would drive you to an apoplectic rage.
August 22nd, 2008 at 6:37 pm
Pardon Me, calm down and smoke a joint!
I too walk past the Dodge Superduty Diesels and Hemi 300C’s at the construction sites. If you think that these guys aren’t enjoying their big pay day now then you’re nuts.
One carpenter told me he made the same wage from 1973 until the last five years when his wage doubled (+overtime he’s making 6 figures).
To Give you some credit his daily driver is a mid 90′s caravan. He figures the majority of his co workers are alcoholics and have kids etc.
It looks like Arit and Pardon Me are saying the same thing.
$60-80K is a high wage and yet it won’t even buy a poorly built condo outside a homeless person camp like TV Towers (which will easily drop 80% in the next decade).