Vancouver is one of the biggest real estate bubbles in North America. The average condo in BC costs 30-50% more than the average condo in Toronto, while Toronto wages are easily 30% more. Most of all despite interest rates currently still decreasing, give it 12 -18 months once the market stablizes and inflation becomes an issue again and the govt hikes rates. There will a tonne of people selling their condos as the their mortgage payments spike.

Right now the average condo in Vancouver requires a 50% downpayment in order for you to have a positive carry over 15 years. That is insane. When you get a positive carry for 30% down than its probably worth considering to buy. However, that would suggest that prices need to decrease 25-35% which I think is not out of the picture. I know a lot of people are waiting for a drop and looking to pounce on the market to get in. However, even if you are able to get in at a lower price, the market won’t run back up to its previously levels probably for 5-6 years.

Don’t get me wrong I think real estate investment in Vancouver can be very profitable, but the spike we have had in the last 5 years has been overdone. One thing that we won’t see probably for a couple of decades is a situation where interest rates are low, along with low housing prices. We had this condition in the late 90′s and early 2000′s mainly because the US govt kept rates low and Canada followed suit to continue strong economic growth and look what it led too. Luckily our banks were more conservative and weren’t dishing out $500K mortgages on zero down.

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” Empty condos or empty condo buildings rented cheap by desperate owners(banks?)and used for Grow-ops and meth labs ” ?

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Executive summary: BC is toast. Gordo bet BC’s economic future on continued high consumer spending and perpetually rising RE prices, and has rolled snake eyes”

I was thinking the same thing. We have also had another bubble in bc no one has talking about. BC bud. I know crime goes up during recessions but i think it will be petty crime and violent crime once these marijuana pimps start feeling the squeeze they will have to start eliminating their competition.

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I love how they have flipped fear. Fear was one of their essential components in creating this bubble. Now that fear is against them, it’s time to ignore it. Remember the “buy now or be priced out forever” mantra?

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From wikipedia, I disagree with some of them and they don’t mention luxury goods but since “luxury” is a bit vague I guess it would just be more confusing than clarifying to mention it in such a brief list. During the depression the very high end luxury stuff did very well, partly because the very wealthy wanted to ignore the droves of poor people so they hung out in exclusive clubs/stores etc.

# Medical Services / Health care
# Pharmaceuticals
# Necessities: food/grocery stores/chains
# Cosmetics
# Education
# Entertainment
# Home & vehicle repair & maintenance
# Debt collection
# Tax preparation / simplification (cf: tax avoidance)
# Career/Job search/Life coaching
# Energy

* Electric
* Oil
* Gas

# Security/Alarm services companies
# Weapons industry
# Insurance
# Funeral homes
# Air Conditioning/Heating
# Plastics
# Emergency Services (Police, Firefighter, Paramedic)

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That says it all. Oh well, he’s probably going to be unemployed soon.

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Aside from that, it’s more the usual myths. I did like the bit where he says “experts have been so wrong about the economy”, and then follows this up by saying “experts say we won’t be affected like th US”…

It’s “pick your own expert day”, apparently.

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http://tinyurl.com/5tygfh

There is no modern-era precedent to these economic conditions, so fear is a natural reaction. Remember the fear surrounding the dawn of the new millennium, 2000? What happened? Nothing.

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The Christmas season is “make or break” for a lot of businesses even in good times.

Prediction : The shit will hit the fan right after the New Year…ho ho ho? OH OH OH !!!!

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Executive summary: BC is toast. Gordo bet BC’s economic future on continued high consumer spending and perpetually rising RE prices, and has rolled snake eyes.

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Actually you’re quite a bit off in your guesses. Strangely enough it’s the middle of the road to expensive stuff that doesn’t sell in a recession. Extremely wealthy people have enough assets to ride through economic troubles so the top end stuff will be fine. For example your #7 is, I believe incorrect. It’s not the high end tickets that won’t sell, it’s the basic seats where people will cut back.

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1.Jewlery
2.Starbucks (recently reporting huge declines)
3.Expensive restaurants
4.Expensive electronics (Circuit City in the toilet)
5.New cars (Ford/GM/Crysler in the toilet)
6.Ski Resorts (Intrawest in the toilet)
7.High priced tickets for sporting events
8.High end clothing stores (Most of Robsin Street)
9.Travel Industry
10.Hotel Industry
11.New furniture Industry
12.Spa Industry
13.High end hair salons
14.Any industry that does not provide products at a resonable price related to food,shelter and clothing.

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http://www.canada.com/vancouve.....e18fa798e0

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Actually it doesn’t. Since the assets are not marketable, they can only be valued by the present value of the income they return, i.e. fundamental value. They cannot be valued at the current market price of comparable properties.

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TITLE: ” When politicians treat voters like bumpkins ”

Ghttp://www.theglobeandmail.com/servlet/ArticleNews/TPStory/LAC/20081112/BCMASON12/Columnists/Columnist?author=Gary+Masonary Mason latest article re Olympic Village

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I see that tag team of ex Vancouver Mayors Phillip Owen and Larry Campbell have parachuted in to back up the current Council. That should concern us even more when we see a “non -partisan” circling of the wagons. Seems more like a kool-aid reunion. Now they want to go on a witch hunt and find who leaked the documents to deflect attention and make it look like Vancouver Council was in the right and were the victims(?). The leaker should get a medal.

The only benefit was that perhaps Vancouver’s Property Endowment Fund (PEF)has been exposed as simply a creative accounting shell game. The PEF assets have been tabulated but very little of it has any liquidity. They claim the fund has a value of over $ 2 + Billion, but most of that is locked up for years in such things as 99 year leases. Given the RE market collapse, and if the drop is say 20 % next year, that would imply the fund could lose $500 + Million in asset value. Then what happens to the Triple AAA credit rating?

To raid the public’s piggy bank to fund what amounts to a pet project ie Olympic Village and not be upfront that they F*cked up royally is simply failed leadership that should have its day of reckoning at the polls. There is this serious disconnect by many politicians who arrogantly and ignorantly think Public Funds are their own Funds(?) to do with as they wish (?) No , Accountability is #1.

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Patriotz, you vewy, vewy, bad person to wish economic collapse on those poor but happy consumers!

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Our beloved leaders CAD bank bailout is now tripled to 75 billion dollars! Take off a few children, poor, seniors etc I doubt we have as many as 25 million taxpayers in Canada. So that’s $3,000 EACH to bailout “the strongest banking system on the planet”?
And we’re supposed to believe these jokers when they say “don’t worry, be happy”?

Bold prediction here: Before Christmas we will an “economic stimulus plan” to put some (borrowed) dollars in our hands with a plea to be patriotzic and save it!

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May 3, following the Bear Sterns buyout, was WAY early. Public statements like that reassure the vast majority of people who don’t actively manage their investments, and many who do, which is why presentation of alternate viewpoints should make them stop and think.

Other than that, and your jibe about not being a card-carrying member of the Berkshire club (my due diligence happens before I buy and receive some vcr manual), I don’t see anything else in your post we disagree on.

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ONWARD AND UPWARD
Wed, Nov 12, 08 at 01:51 AM
At least the Millenium development at False Creek is safe. Lots of presales and the development will sell out quick for top dollar. We are the best place on earth. Real Estate is very cheap here compared to other world class cities

the ol’ “koolaid” enema trick…..
seems to still work!

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http://tinyurl.com/5rp9a7

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