I bought at exactly the wrong time

On a Monday morning where the TSX started off the day with a fresh 1200 point plummet we’ve got more negativity about the local real estate market on the front page of the Vancouver Sun: I bought a house at exactly the wrong time.

And the chances of Vancouver prices actually dropping? Maybe two out of 10, I surmised. (Most of my friends, who at dinner parties often talked about how their soaring real estate was ensuring their retirement, thought I was slightly crazy to even think such a thing.)

As you might have guessed, my resolve had finally weakened. So, in the spring of 2007, I bought a piece of paradise. The odds seemed on my side, I decided. At first the prices seemed to keep soaring.

Soon I was telling people at dinner parties how much my house had gone up, too.

Now I’m back to where I started.

The real-estate-disaster bloggers actually were prescient. Wall Street is melting down because of the junk mortgages. Bay Street is in a tailspin. Now my almost daily question is what’s going to happen here?

Yep, the bloom has come off the rose when stories like this are on the front page.  Although we still have a huge problem with affordability, Vancouver house prices have dropped below where they were one year ago. sales have dropped right off and listings continue to grow as the global economic forecast gets dimmer and dimmer.  For many there’s still time to make out with a profit, but the competition is growing fiercer as we race for the bottom.

“I wouldn’t feel bad about buying,” said Jock, listening to me fret. “Nobody saw this coming. We’re in a hurricane, but in a hurricane you don’t know how bad it is until it’s over. And it’s not over.”

Nobody saw this coming and nobody could have predicted that the experts would say ‘nobody saw this coming’ right?  I bet you also couldn’t guess what Bob Rennie has to say about the whole Vancouver housing market crash:

Rennie also believes the fundamental reality is there’s no oversupply of housing and condos in the city of Vancouver, as there is in many U.S. cities now seeing the market tank. He also sees a strong demand for Vancouver’s high-end real estate by rich people from afar.

“I wouldn’t sell right now,” Rennie said. “In fact, I just bought a few more units myself.”

I’ll be back in a short while, I’m just going to go ask a car dealer if its a good time to buy an SUV.

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paul
11 years ago

Real estate values are cyclical, this is the down-cycle. The last downturn we had lasted 11 years. There may be no bad time to buy real estate but there are some very bad times to try and sell. It may be true that values seem higher over time, but what of the inflation adjustment and the opportunity cost? I suspect that many new owners are upside down in thier mortgages and will have to carry these chintzy coffins long past the expiry date. It's not real property is it. As you grow older you might want to start a family, kind of hard to do that in an 500sq ft cat swinger in a highrise. I pity the fools that got suckered by the Bob Rennies of the world.

bearette
bearette
11 years ago

We all saw it coming. Revenge is so sweet.

Bwahahahaha! (I love doing that.)

That one goes out to all the asinine coworkers who mocked me for not following the sheeple into some $400,000 800=square-foot coffin in the sky.

Bwahahahaha!

See you at the 50 per cent off firesale!

/mania off

VHB
VHB
11 years ago

"nobody saw this coming"

HOOOCOODANODE!!!!

signed, VHB aka Mr. Nobody!

dbcooper
dbcooper
11 years ago

Today was a predicted day at the stock market. Everything is going according to plan. Bwahaha.

arit:

i'm liking this "new" you….:-)

betamax
betamax
11 years ago

Today was a predicted day at the stock market. Everything is going according to plan. Bwahaha.

Agreed. I've been wrong on the timing — it's taken longer than I thought, but everything is unfolding as expected.

Maybe I should get a job prognosticating in the media…oh wait, I'm lousy liar and that's an essential prerequisite.

arit
11 years ago

I am also proud to be one of the 'nobody who saw it coming' crowd!

Today was a predicted day at the stock market. Everything is going according to plan. Bwahaha.

Regards,

arit

patriotz
patriotz
11 years ago

Nobody here but us nobodies. 🙂

swirlyman
swirlyman
11 years ago

"NOBODY saw this coming…"

That's just their way of giving credit in a back-handed way… calling us a bunch of nobodies…

/dev/null
/dev/null
11 years ago

k9dr said: "Wow, what a change in just a few months. When I started reading these sites, the media was hyping realestate. In August, it was mostly about how it was plateauing, and now everything is about how its about to collapse. Even my clients who know nothing about realestate are all saying how bad its going to be"

Wasn't it VHB (perhaps freako?) who said a long time ago that the MSM were going to do a 180 in the matter of weeks? Prescient (again).

dingus
dingus
11 years ago

"Strange indeed that somebody would read bear blogs and yet buy in the largest remaining bubble market at the worst possible time." Not really. Something that goes on for a long time sometimes starts to look kinda permanent. Add a dash of fear of being priced out forever, and a soupcon of wanting what you want NOW not later, and sure, I can see having bought any time over the past few years. A good number of my bearish friends capitulated and bought. Some of them sheepsihly even believed that they were buying at the top, but got sick of waiting. On the hoocouldanode meme, now Fuld, CEO of Lehman, is saying that nobody could have known housing was in a bubble. I guess if you're only going to pay a guy 30 million a year, you can't expect him… Read more »

jesse
jesse
11 years ago

"All these 'experts', 'analysts', spin doctors and various other pundits overlooking the obvious, perhaps intentionally so."

There's apparently some bizarre rule used by economists that high price-rent ratios are invariably the RESULT of other fundamentals like employment and GDP being strong when it is more often than not the other way around. The old "we can't second guess market forces" doctorine followed by hoocoodanode. It's intentional all right but I don't know if they believe it or not.

arit
11 years ago

Of course should read SAW it coming…

arit
11 years ago

NOBODY saw this coming

NOBODY saw this coming

NOBODY saw this coming

What arrogance. Maybe say: I was so Greeeeeeeeeeeedy that I mocked those who so it coming!

Burn baby burn.

Best regards

arit

freako
freako
11 years ago

Strange indeed that somebody would read bear blogs and yet buy in the largest remaining bubble market at the worst possible time.

The "hoocouldanode" crap is pathetic. Finlayson is ridiculously optimistic given circumstances. Rennie's suggestion that DT condos will fare well is hysterical.

In reality it is soooo simple. The best predictors are price/rent, price/income and affordability. When these go out of whack, prices are expected to fall until they are in line with historical norms. All these "experts", "analysts", spin doctors and various other pundits overlooking the obvious, perhaps intentionally so.

bullsh!t
bullsh!t
11 years ago

It's interesting that this is the first housing bubble and meltdown that is happening entirely online. I just searched this blog for the phrase 'nobody saw this coming' and found the following comments that not only predicted the crash, but predicted the experts would say 'nobody saw this coming' From Tulipmania2 on June 14th 2007: The next stage: RE has crashed, (and not just because of the economy), inflation is still high, interest rates are still on the rise, and unemployment is rising. Pastrick, Muir, and et al, will say that nobody saw this economic shock coming. From anonymous on April 11th 2008: I don’t have a problem with salespeople and hype artists like Rennie and Good pumping up the market, but I’d like to hear them pledge that the free market should remain free in all circumstances. This means… Read more »

dingus
dingus
11 years ago

What jesse said. Nobody saw this coming? Pffftt. Lame.

And I wonder why all the blogs the writer cited were US blogs? He's such a boffo journamalist he didn't think to add "vancouver" to his google search for "housing" + "crash" + "bubble"? Or is it just too impolitic to mention that –gosh– there's been a bear camp for vancouver all along too, just that his employer ignored it. How many myths was it again?

Hoocoudanode? indeed.

gah
gah
11 years ago

Milleniun water project in trouble – rut roh: http://www.theglobeandmail.com/servlet/story/RTGA

jesse
jesse
11 years ago

"its not like the bar is set really high or he’s got a lot of stellar competition."

Amateurs on this very blog ran circles around Finlayson and the other "experts" and will continue to do so all the way to the bottom. His "nobody saw this coming" comment is disingenuous and self-serving or just plain incompetent; it's not my fault he didn't bother expanding his research and analysis to include the local blogosphere.

patriotz
patriotz
11 years ago

Just you wait until some disgruntled yuppie hires his lawyer to sue his agent for his financial ruin.

Realtors, like all other commissioned salespeople, are agents of the seller, only. Their job is to sell the property for the highest possible price.

ted
ted
11 years ago

And I don’t mean asking for Ozzie Jurock’s advice either

Didn't Ozzie say he wouldn't touch downtown condos as an investment 'if his life depended on it'. .. and I think that was more than a year ago!

ted
ted
11 years ago

I love it how Jock is described as “probably the best economic forecaster in the West”. Fail SQUARED!

I dunno, its not like the bar is set really high or he's got a lot of stellar competition. I think his forecasts have been a lot more reasonable and safe than most of the bozos they quote in the MSN.

pinocchio123
pinocchio123
11 years ago

I meant fall, not fail…

Bubble Lad
Bubble Lad
11 years ago

Only in the bizzaro Rennie Marketing Systems universe can "not a time to sell" become "a good time to buy more units". WTF?

pinocchio123
pinocchio123
11 years ago

Just you wait until some disgruntled yuppie hires his lawyer to sue his agent for his financial ruin.

See how I said "his" so many times?

Oh no, poor me – how could I have seen it coming?

Wasn't it HIS responsibility to look first before you could actually see?

How about trying to do some basic research before making a biggest financial decision in ones life.

And I don't mean asking for Ozzie Jurock's advice either…

Poor, poor losers.

I have no pity for the ones about to fail.

Chris
Chris
11 years ago

Yeah, I read that column this morning. The guy says he lurked on real estate collapse blogs for years and he still has the gall to pull the hoocoodanode!! card?