Friday Free-for-all!
Better late than never, it’s time for our open topic discussion post. Here are a few stories I’ve noticed this week:
-Bring on the real estate crash
-BC Expected to barely avoid recession
-BC economic stimulus package: an extra $70 for you
-Scotiabank: Canadian housing market slide overstated
-Canadian banks: longest profit slide in two decades
-You can still get a zero down mortgage
-What will happen to luxury condos?
-Harper will ‘do what it takes’ to fight economic crisis
-Fears of deflation
-Economics 101: everything you know is wrong
-67,000 Chinese factories closed in six months
So what are you seeing out there? Post your news, links and anecdotes here and have an excellent 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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November 21st, 2008 at 10:33 am
I want to start this Friday off by stating that I think Richmond Condo prices are going to really start tanking more than any other area, if they haven’t already.
All those hi rises are speculator owned, I suspect as much as Downtown Vancouver except once the acid wears off they’ll realize they paid $400k for an apartment in Richmond and will provide facts as soon as possible.
November 21st, 2008 at 10:51 am
The Canadian real estate crash may be overstated, but the Vancouver crash sure isn’t. A friend of mine just bought a place for 25% off its original (inflated) list price. I think its a bad time to buy, but hey if you find a place you want to live for a long time and don’t care if the market keeps dropping that’s up to you.
There are so few buyers out there anyone who really wants or needs to sell will jump on lowball offers.
November 21st, 2008 at 10:55 am
Seems like we’ve officially entered the “Staring Contest” portion of our program between buyers waiting for prices to drop further, and sellers refusing to admit the market has changed. Who will blink first?
November 21st, 2008 at 10:59 am
“Who will blink first?”
The one that needs to. I know of at least one couple who’s income has dropped and they NEED to sell. I’ve never heard of anyone who NEEDS to buy.
November 21st, 2008 at 11:01 am
good point.
November 21st, 2008 at 11:02 am
A friend of a friend inherited a $4.3 million dollar house in Shaughnessy and so far the only credible offer he’s received was for $1.7..
Where are those rich asians when you need’em?
November 21st, 2008 at 11:11 am
What ig happening with the Canadian bank stock prices?
November 21st, 2008 at 11:14 am
Where are those rich asians when you need’em?
They’re moving back to the family farm in rural China after losing all their paper millions.
November 21st, 2008 at 11:15 am
I’ll register for a name tonight so that my name will stop popping up on other peoples posts.
Maybe a better nickname too?
November 21st, 2008 at 11:15 am
Asians like to bargain, even the rich ones.
Thanks Russell Peters for letting the world know our secret.
November 21st, 2008 at 11:17 am
A great read from the New Yorker.
“For most adults, the sensation of being proved right is usually a complex and bittersweet one. You might have said that your brother-in-law would turn out to be a no-goodnik, or that the forty-third President would turn out to be the worst in American history, and you may regard subsequent events as inarguable proof that you were right—but it’s not an especially happy feeling. It changes nothing about the world outside your head. You were right. Congratulations. And?”
http://tinyurl.com/6g36r9
November 21st, 2008 at 11:21 am
“You were right. Congratulations. And?”
And… I’m not lumbered with a 400k mortgage on a 350k and sliding condo…
November 21st, 2008 at 11:25 am
haha, the BC gov’t is still trying to say we will avoid recession. funny stuff. I can’t even come up with 1 key industry that isn’t hurting. Is there one??? anyone? anyone?
November 21st, 2008 at 11:33 am
I’m not lumbered with a 400k mortgage on a 350k and sliding condo…
From what I’ve seen it’s more like a 400k mortgage on a 300k and sliding condo, and that’s IF you can a buyer.
November 21st, 2008 at 11:35 am
macchiato – we definitely won’t have a recession. Dear leader Harper (an economist!) said in September that if there was going to be one it would have happened by then.
November 21st, 2008 at 11:38 am
The latest projections for REBGV’s November stats by Kopyrightklepto in the RT forum (using Paulb’s posted numbers) are as follows:
Listings: 3334 (-6% yoy)
Sales: 922 (-69% yoy)
Sell/List: 28% (-56 pts yoy)
MOI: 21.4 (469% yoy)
Actives: 19715 (77% yoy)
http://www.realestatetalks.com.....p;start=30
Folks, the projection is 21.4 MOI and a -69% YOY drop in sales for November. With these stats, there is no doubt that Vancouver will lead Canada as the biggest real estate meltdown.
November 21st, 2008 at 11:52 am
We are beginning to seeing signs of forced liquidation in the condo market. Just go to craigslist and read the listings for condo sales where people are disclosing their purchase price to demonstrate that they are selling at a loss. Presumably this is to convince us that the condo is a bargain.
Forced liquidation is THE nightmare scenario for the RE market. If you want to know what forced liquidation looks like, just think of the stock market over the last three months.
Lets cheerlead the collapse of the bubble. All together now, “Forced liquidation, ha, ha, ha! Foreced liquidation, rah, rah, rah!”
November 21st, 2008 at 11:58 am
Seems like we’ve officially entered the “Staring Contest” portion of our program
You must be kidding. The “staring contest” lasted all of a couple of months and ended in July. We’ve been in full Wile E. Coyote since then.
November 21st, 2008 at 12:06 pm
Apparently, “Nobody saw it coming” is the new “Housing prices never go down”.
I can’t believe we’re still being fed this crap by the MSM. How about Schiff? Roubini? Mish? Ron Paul? The Pope? Didn’t they see it coming?
The reason they saw it coming is that they realized a simple economic truth: money is not the same thing as wealth. Money is paper and ink. Wealth is goods and services. When you have an economy built on premise that you can become wealthy by buying a house and sitting in it for a few years, without actually doing anything useful, the economy can’t NOT come crashing down. When you have the entire mainstream media telling the populace that “consumer spending drives the economy”, you should know that things are seriously wrong. Of course, it’s much easier to believe that we can all go on buying each other’s houses for more and more money, spending our increasing “wealth” on crap made in China, and driving up our credit card balances than to believe that we actually need to do real work to increase our wealth. So easy to believe, in fact, that the mainstream economists still don’t seem to get it.
November 21st, 2008 at 12:31 pm
“But when the dominoes began to fall, almost no one foresaw the depth of the problem and the speed at which it would spread.
“Nobody,” said Prof. Rick Harris, a Simon Fraser University economist specializing in international economics, “predicted how bad it was going to get.”
************
SFU obviously has no internet access….. the poor things. Methinks my children will not study economics there.
November 21st, 2008 at 12:38 pm
On a day when Canadian stocks saw their biggest drop in more than five years, the B.C. Liberal government held firmly to the view that British Columbia will avoid a recession.
“Our economy is strong relative to pretty much every other jurisdiction in North America,” Finance Minister Colin Hansen said Thursday after introducing legislation meant to help stimulate the economy.
“Nothing on the horizon would lead us to believe that the province is at risk of going into recession,” he added.
Maybe you don’t see it on the horizon because it’s about to land right on your head, Colin.
Stephen Harper insists he’s still optimistic about Canada’s economic prospects despite a pessimistic warning from top economists that the country is heading for a prolonged, severe recession.
Great minds think alike.
http://www.thespec.com/article/446423
November 21st, 2008 at 12:48 pm
read on,
I think Harris’ point is that although many of the folks up on the hill expected a downturn, a lot of them were surprised at the speed–and to a lesser extent, the depth–of the market reaction in the past two months.
Trust me…there are more than a few econ profs from both SFU and UBC lurking on this and other local blogs.
November 21st, 2008 at 12:57 pm
i cannot believe this:
“BC Expected to barely avoid recession”
what the …
these people are so idiots i need to come up with a brand new name. any suggestions
November 21st, 2008 at 1:10 pm
I just returned from a banking show in Florida. Attendance was down 50%. None of the big banks showed up, just credit unions and community banks who have been conservative and less greedy. This didn’t surprise me though and when I asked how they are weathering the storm, most answered that they were strict on lending and now even more stricter. One bank president was telling me that in their town, the people who can’t pay their car loan, they “lose them to the bank” and then they come in the next week, with a bigger and more expensive car, as the car dealerships are giving credit to anyone and everyone. As you all know, Florida was hit hard with the subprime mortgages, and now every day on the news they show “foreclosed” homes magically catching on fire…..Even the theme parks are suffering (30% down from last year). This is going to be a long recession…..
November 21st, 2008 at 1:12 pm
The deposit for ” Pets ” was noted in the Spectrum rental scam
Just a side note re PETS and “PET Damage to premises” which will hopefully benefit others.
Upon a fair bit of research/due diligence, I could NOT, I repeat could NOT find any insurance company that would insure for ANY damage caused by Pets, regardless of whether it was the Owner’s pets or the Tenant’s pets.
The last insurance company that apparently insured for this no longer does ( but ironically this firm does provide health care insurance for pets ).
In a glutted RE market which will probably have a higher vacancy rate… Landlords may turn a blind eye to pets,…or be aware of pets and agree to them ,….. or some tenants do sneak them in….but keep this in mind if the budgie, or goldfish ,or cat,… or bengal tiger/elephant combo causes damage to the premises and you, the Owner, and think the insurance company will cover pet damage,the answer I received is = NOPE !!!).
Check it out…but if someone is aware of such an insurance company that will cover pet caused damage etc. , please advise the rest of us.
November 21st, 2008 at 1:37 pm
Post #10
BS ..Asians always want to pay full price !!! LOL
On a related note….A family friend who was a realtor told me of a tradition that offshore (ie Hong Kong ) money was importing here (until it was caught and stopped).
Apparently, parties from parts of Asia such as Hong Kong, as per tradition over there, were adding very generous bonuses (on top of the RE commissions they paid in the RE purchase price).
Some Local realtors were knowingly accepting them , instead of informing their clients that it was NOT a custom here.
November 21st, 2008 at 1:39 pm
Speaking of Spectrum and rentals:
Using the “lights on in the evening” indicator for occupancy – Spectrum is looking more occupied than Paris Place (the building above the T&T).
The Espana complex is really cranking along too. More supply. woo woo.
November 21st, 2008 at 1:41 pm
Re:pets and insurance
If the tenant had insurance wouldn’t pet damage fall under his/her liability or under voluntary property damage?
It’d have to be pretty bad to cover the deductible though.
If the dog is just peeing on the floor it’d be the same as if the tenant did it and he/she would have to pay for the repairs?
The big problem with condos, if memory serves correctly, is water damage from washing machines and people setting off the sprinklers and neither of those are likely to be caused by a pet.
I’ve passed caib3 but don’t do personal lines so maybe someone else here can shed some light on this.
It’s the same as if the tenant pees on the floor and chews the walls isn’t it? In which case it’d go to arbitration and the tenant could pay.
Perhaps Krissh can advise us on what happened the last time he had to move out? Did the landlord make you fix the walls and clean up the floor?
November 21st, 2008 at 1:47 pm
No-Lympics.
Did the Insurance company specifically exclude pet damage?
With a comprehensive policy it’s covered unless it specifically states otherwise, again i don’t really know much about it.
November 21st, 2008 at 2:04 pm
Post #1 by BDK
I couldn’t agree more.
Richmond has a hi-rise condo project kitty – corner to Richmond City Hall just getting past lock- up that is one to watch. If the market is tanking , and a glut of competing product is coming forward , does it make any sense to start finishing this project ,ie throwing good money after bad ? Seriously, is it?
Dueck auto dealership sold its downtown Richmond site and just moved to brand new digs by the Massey tunnel, in probably one of the most poorly accessible areas of Richmond. I’ll place a bet right now that the Dueck dealership there soon will be hit by a ” Perfect Storm” of POOR location “meets” Tanking – economy and it will be gone in a year or two . The old Dueck site will probably be mothballed… though an offshore developer still maintains they want to build a 500 + unit plus residential complex there soon …LOL.
Another smaller Richmond condo complex ie 12 unit has sold about 10, but the final 2 units have sat UNsold for months. Those 2 UNsold units may represent the builders profit… so they effectively worked for nothing ie broke even on the effort, if that.
Projects along Lansdowne Road are half – built(ie at the mid point in total height). …….then what do they do ?
On a side note:
Re:That Hi Rise condo that had the plane crash into it last Fall 2007. It was reported that a lot of the owner- residents (who appear to be mostly of Asian descent) did not have insurance , and neither did the pilot have much if any. Many of them have had to live elsewhere and burned through personal savings. This very unfortuante incident may expose the myth/ reality of the “Rich Asian” living in many of these Hi- rise condos and other condos units .
November 21st, 2008 at 2:24 pm
if the tenant did it and he/she would have to pay for the repairs
Only to the extent that the damage deposit would cover it. Good luck to the owner getting anything more, I’ve been to arbitration before when I lived with roommates. In our case the hardwood floors had been scratched up pretty bad and there was pet damage to the house as well. Even though it would cost way more than the $600 damage deposit to repair the arbitrator made the landlord give us back half the damage deposit.
I can’t believe anyone would willingly choose to be a landlord unless the rental income is giving them a really good profit on top of bills, they hire a management company and don’t care about the condition of the property.
November 21st, 2008 at 2:25 pm
BDK:
RE: Pet insurance
FYI: My own tactic with insurance policies is more to put the onus on the insurance Agent to interpret the policy for me ( given I can tend to be a cheap pr*ck at times and want some service in conjunction with annual payments ). The Agent can interepret the coverage’s legalese for me upon my request, …..that’s THEIR job, and not my obligation .
As an example: defining “FIRE” coverage.
I asked them if that includes ” Molotov Cocktails “.
Answer from Agent was ” NO , that is not covered under ” FIRE”..that is deemed “MALICIOUS DAMAGE ” ….which then requires additional coverage.
To which I stated to my agent…OK cover me for “MALICIOUS DAMAGE” as well.
In the same vein, I interrogated the insurance agent re ” PETS”…asked the question from all angles….and discovered that if a Pet causes damage,( or conversely the damage caused can be traced to the pet), I could NOT find ONE single insurance company that covered anyone for “Pet damage” .
I had previously assumed they did cover Pet damage, but when I found out they didn’t , I was glad that I was now aware, so as to avoid any/all nasty surprises now and in the future.
November 21st, 2008 at 2:34 pm
Somali Pirates in Discussions to Acquire Citigroup
By Andreas Hippin
November 20 (Bloomberg) — The Somali pirates, renegade Somalis known for hijacking ships for ransom in the Gulf of Aden, are negotiating a purchase of Citigroup.
The pirates would buy Citigroup with new debt and their existing cash stockpiles, earned most recently from hijacking numerous ships, including most recently a $200 million Saudi Arabian oil tanker. The Somali pirates are offering up to $0.10 per share for Citigroup, pirate spokesman Sugule Ali said earlier today. The negotiations have entered the final stage, Ali said. “You may not like our price, but we are not in the business of paying for things. Be happy we are in the mood to offer the shareholders anything,” said Ali.
The pirates will finance part of the purchase by selling new Pirate Ransom Backed Securities. The PRBS’s are backed by the cash flows from future ransom payments from hijackings in the Gulf of Aden. Moody’s and S&P have already issued their top investment grade ratings for the
PRBS’s.
Head pirate, Ubu Kalid Shandu, said “we need a bank so that we have a place to keep all of our ransom money. Thankfully, the dislocations in the capital markets has allowed us to purchase Citigroup at an attractive valuation and to take advantage of TARP capital to grow the business even faster.” Shandu added, “We don’t call ourselves pirates. We are coastguards and this will just allow us to guard our coasts better.”
November 21st, 2008 at 2:37 pm
BDK:
You made a good point, given “my understanding” via legal precedent is that insurance companies must list what they exclude from coverage… or it is assumed they MUST cover it. I had been informed that there is a “core list” of “coverage exclusions” most insurance companies abide- by and specifically list in their policies.
However… as I said earlier, I have asked the specifc question re Pets…so as to be 100% certain.
PS There are probably a number of other anomalies out there re: coverage that people assume they are covered for by insurance but are actually not covered for.
November 21st, 2008 at 2:42 pm
Time once again for some bear facts :
1) Vancouver condos are the best investment vehicle ever made because everyone wants to live in Vancouver particularly during the beautiful mild winters.
2) The economy of the best place on earth is de-coupled from all the other places on earth. That’s one of the reasons why it’s the best place on earth. Duh.
3) SUVs, boats and RVs are also solid investments especially now that Bigfoot is going under and GM on death’s door. Once everyone wants these products again I’ll be the only game in town. It’s called buy and hold baby.
4) Gold, stocks, bonds, cash are all just about worthless.
November 21st, 2008 at 2:52 pm
John, the detached benchmark has dropped $75K this year. How do you explain that fact?
November 21st, 2008 at 2:55 pm
*CITI IN TALKS WITH SOMALI PIRATES FOR POSSIBLE CAPITAL INFUSION
*WILL REQUIRE ALL CITI EMPLOYEES TO WEAR PATCH OVER ONE EYE
*SOMALIAN PIRATES APPLY TO BECOME BANK TO ACCESS TARP
*PAULSON: TARP PIRATE EQUITY IS AN `INVESTMENT,’ WILL PAY OFF
*KASHKARI SAYS `SOMALI PIRATES ARE ‘FUNDAMENTALLY SOUND’ ‘
*Moody’s upgrade Somali Pirates to AAA
*HUD SAYS SOMALI DHOW FORECLOSURE PROGRAM HAD `VERY LOW’ PARTICPATION
*SOMALI PIRATES IN DISCUSSION TO ACQUIRE CITIBANK
*FED OFFICIALS: AGGRESSIVE EASING WOULD CUT SOMALI PIRATE RISK
* FED AGREED OCT. 29 TO TAKE `WHATEVER STEPS’ NEEDED FOR SOMALI PIRATES
November 21st, 2008 at 4:09 pm
I have to say, it is a nice “I told you so” to see YVR real estate finally starting to fall apart, but it is also quite depressing to see my hard earned RRSP shrinking exponentially along with a good chunk of my saved up downpayment. I put 50% of my downpayment in guaranteed funds, thank goodness but played with the rest. The only solace is that I’m going to get a nice capital loss and the fact that I wasn’t leveraged means that the drop in savings is not as great as the drop in equity had I held on to my place instead of selling at the end of ’07 and renting.
November 21st, 2008 at 4:13 pm
hey, the somali pirate scenario isn’t all THAT ridiculous. Didn’t the head of the NYSE visit the FARC guerillas in colombia a few years back, asking them to invest their gains from coca running in the stock market?
November 21st, 2008 at 5:52 pm
Article:
” Is Warren Buffet losing his touch ” ?
http://www.guardian.co.uk/busi.....le/8050372
Berkshire stock has lost over 50 % of its value since last year.
November 21st, 2008 at 6:09 pm
Remember when Warren Buffet announced, with great fanfare and much fawning media coverage, that he was buying into US equities with his personal fortune? That had nothing to do with trying to use his name to move the market and protect Berkshire stock, did it?
November 21st, 2008 at 6:16 pm
UBC investments have gone sour.
http://www.canada.com/victoria.....2b31bba677
” UBC’s financial department has been embroiled in controversy since it was revealed earlier this year that university investments have lost about $37.9 million in value.
The university had invested about $130.6 million in non-bank sponsored “asset-backed commercial paper” (ABCP). ”
Too funny:
What’s that saying….Those that can do…those that can’t______?
November 21st, 2008 at 6:27 pm
An interesting piece on BNN, titled “Hedge Fund Bets Against Canadian Banks & It Pays”
quote: “Oh that will never happen here — I am affraid it looks like you are catching the infection…”
http://watch.bnn.ca/#clip114830
November 21st, 2008 at 7:55 pm
I would totally buy shares in a Somali Pirate Bank. Thank you for making my shitty-I-hate-my-job day!
November 21st, 2008 at 9:28 pm
Reposting – Friday for all, have fun:
Five years ago, our bulls brought forth, upon this lower mainland, a new notation, conceived in greedy, and dedicated to the proposition that “Vancouver RE never goes down”.
Now we are engaged in a down turn, testing whether that notation, or any notation so conceived, and so dedicated, can long endure. We are met on a great battle field of that turmoil. We have come to dedicate a portion of it, as a final resting place for those who died here, that the notation might live. This we may, in all propriety do. But, in a larger sense, we can not dedicate — we can not consecrate — we can not hallow, this ground– The brave men, living and dead, who struggled here, have hallowed it, far above our poor power to add or detract. The world will little note, nor long remember what we say here; while it can never forget what they did here.
… …
November 21st, 2008 at 10:05 pm
You want real-estate carnage?
Look no further than Kelowna, BC.
Average home prices down nearly $100,000 (16%) in only six months. This beats every other metropolitan area in North America for $ and % drop in only six months following a market peak (for an average home). The annualized rate of decline for the average Kelowna home has exceeded 33% and is rising rapidly.
Condos and other highly speculative slices of the market are down almost 30%. MOI for all market sectors has already hit 32 months. Sales for the entire market are down 76% from the market peak.
Kelowna itself could easily see a 70% peak-to-trough drop in home prices before 2012.
Read and learn: http://www.west-kelowna.ca/
November 21st, 2008 at 10:17 pm
That renters smile was wiped off my face for a split second there; how dare Kelowna challange Vancouver for title to biggest real estate decline. Dont you know we have the Olympics? Anyone else notice how quiet it is downtown these days. Robson was almost a ghost town at lunch today, a Friday 5 weeks before Christmas! This is going to be one massive bust. Ha, and I couldn’t be happier. Anyone heard from Maggie or any of the other pimps lately? BOB RENNIE WHERE ARE YOU? Are you in daily meetings with your PR consultant? Damage control for your brand? Have you bought any of those great value condos lately? Give us something.
November 21st, 2008 at 10:41 pm
With a global loss in appetite in investing in real estate, coupled by a sharp cutback in spending because everybody wants to hoard cash these days, we could possibly experience a reduction in demand similar to 81/82 or maybe even worse than 81/82.
What would be interesting is if somebody had the statistics for “number of sales/population of Vancouver” going back to 1980 so we can compare how today’s sales/population compares to 81/82 sales/population, the demand in Vancouver is just there like New York and Tokyo.
November 21st, 2008 at 10:46 pm
A friend of a friend inherited a $4.3 million dollar house in Shaughnessy and so far the only credible offer he’s received was for $1.7..
Which means, of course, he actually inherited a $1.7 million house.
November 21st, 2008 at 10:46 pm
Mike Stewart is spamming all the local bear blogs!
November 21st, 2008 at 10:48 pm
I think Harris’ point is that although many of the folks up on the hill expected a downturn
So why the hell didn’t any of them say anything in public about it?
November 21st, 2008 at 11:11 pm
RE: Richmond condos
quick look on mls finds over 1000 condos for sale in richmond. and, i can thinking of at least 5 projects near completion. over built and over priced…
November 21st, 2008 at 11:22 pm
Dosh > Is that really you? Have you been at the school of rationality, grasshopper?
November 22nd, 2008 at 12:09 am
Apparently, parties from parts of Asia such as Hong Kong, as per tradition over there, were adding very generous bonuses (on top of the RE commissions they paid in the RE purchase price).
Some Local realtors were knowingly accepting them , instead of informing their clients that it was NOT a custom here.
That’s more than “not a custom”, it’s a criminal offense. The realtor is a fiduciary of the seller and may not take any compensation from the buyer.
November 22nd, 2008 at 1:03 am
“Anyone heard from Maggie or any of the other pimps lately?”
Actually, yes, just yesterday in fact. I was browsing the magazine stand in my local newsagent here in the UK, and picked up a copy of “Living Abroad” magazine because they had an article on moving to Vancouver. And lo and behold, who was their spokesperson there? Maggie of course! All the usual, “geographically blessed”, “best place on earth” type proclamations. And then a list of “typical” condo listings, and out of the four condos, three of them were listed by – guess who – Maggie of course!
As an aside, it’s really interesting to watch the markets here and over in Vancouver. They are declining in different ways. Over here, the market has been stagnant for over a year now, and there have been mild reductions despite the financial crisis (with the exception of flats). The reason for this appears to be a reluctance on the part of homeowners to lower their price to something realistic. Instead, what I am seeing is loads of houses that were previously for sale up for rent. Well, where I live there isn’t a big demand for rental properties, so I suspect next year we will see the big crash when these sellers finally realize they have to sell or get repossessed.
On the other hand, over in Vancouver, the crash has happened spectacularly fast. I’ve been following the migration of prices in the north shore, and in the last few weeks there are tons of properties that were only listed a month ago, coming up this month with price reductions of 10% or more. 10% in ONE MONTH! Looking in from the outside I have to say that you are experiencing a very, very severe correction.
November 22nd, 2008 at 1:34 am
Not to be a party pooper — I have bear DNA my own self — but by my back of the napkin estimates, with the data I can glean, if you were to subtract West Van from the Greater Van picture, real estate here is in, and likely only to experience, a modest 10 – 15 % drop, peak to floor. West Van appears set to be WIPED OUT.
Please, ANYBODY.. disabuse me of this analysis if you can. While I do not own in West Van, I have friends and close family there who appear to be at debt death’s door if things continue as I suspect they will…
November 22nd, 2008 at 3:00 am
patriotz wrote: “That’s more than ‘not a custom,’ it’s a criminal offense. The realtor is a fiduciary of the seller and may not take any compensation from the buyer.
You’re wrong. Nothing stops a realtor from being compensated by the seller and the buyer and any other party. As long as it’s disclosed in writing.
November 22nd, 2008 at 6:37 am
West Van:
West Van is a destination address. Why else do people really want to live there ? View and ego, isn’t it ? Its quite transient at the upper end of the income spectrum, isn’t it? If the West Van real estate market is taking the biggest hit..that pretty much validates the aforementionend. A lot of fast overnite wealth lives there…the type that feels these quickie millions will never end. That attracts the type that will bid up and inflate RE prices more than anywhere else to keep up with the Jones’s.
They have a tax and spend Mayor they voted back in . I once read their police stats and they must have one of the most bored police forces in BC. Their Public Rec centers are a joke compared to other Cities…they must prefer the Private Clubs . A lot of the RE developers (ie Cressey, Bosa et al) live there. Funny thing….a lot of these high roller types had their $30 million homes up for sale recently, did they sense something ?
PS: If they want a waterfront view, they can move to Surrey where it is much cheaper and look over the Scott Road flats.
November 22nd, 2008 at 6:37 am
Octagonian:
Try this on for size. WV has a lot of smart money, they didn’t get rich by accident, they aren’t in denial, the ones that want to sell are more willing to cut fast and deep to get out when they still can. Stay in denial and you won’t sell, if you don’t sell you don’t show up in the stats.
And as always, anywhere, if you bought before the boom, didn’t HELOC out money, don’t need to sell, don’t want to sell, plan to and can afford to live in your home for the long term, then you are irrelevant to the market, just as the market is irrelevant to you.
November 22nd, 2008 at 6:41 am
There you go go. Two very different explanations for the same phenomena. This is how wars get started. I’m a pacifist, and going away for the weekend, so no first strike from me. Have a good time, y’all.
November 22nd, 2008 at 8:01 am
Few things I’ve got to say:
1) Someone here told a story of a colleague who invested her money, which was to be used for a downpayment, and lost much of it on the slide. Timing of your investments is paramount. If you NEED the money in the short-term, don’t risk it, go into something gauranteed to be safe.
2) If your RRSP’s are hurting, again, think of the time until you’ll need that money. If you’re nearing retirement you should’ve been out of equities long ago. If you’re like me and have 30 plus years, toss more in, dollar cost averaging works.
3) Scotia article – There is no such thing as a National Housing Market. The idea is absurd. I suppose they’re like bnn, desperate for some good news.
4) I talk to developers all the time through my work. They are worried (to put it lightly). Most have halted new projects, trying to finish up what they have outstanding. All have told me they knew this was evemtually coming, but are shocked at the speed that it has turned. Bigger they are the harder they fall – BOOMS.
5) Similarly, I was at a seminar this week with a many architects and engineers. The few I had a chance to speak with all said the same thing – there are no more projects coming down the pipe. Those that saved and prepared for rainy days will last, plenty of others won’t.
November 22nd, 2008 at 8:18 am
Octagonian: Could you elaborate on how you end up with a 10-15% correction? Let’s see what you are using to get there, to start with.
November 22nd, 2008 at 8:30 am
Vansanity ; “3) Scotia article – There is no such thing as a National Housing Market. The idea is absurd. I suppose they’re like bnn, desperate for some good news.” This is something that everybody should really see (you would think), previous forecasts on the upside in the last five years were WAY under what Vancouver gained. How can the same people that saw the appreciation far surpass the national average now use the national average to spin a conservative number on the down turn? Remember BC is NOT big in Scotia Banks eyes. Ontario Quebec Ontario/Quebec repeat after me! That is their market! Vansanity is right on National stats they don’t matter to Vancouver on the way up or down! Anyone who recites the Nat Stat as a defense should be told okay we exceeded the nat stat on the way up so YOU agree your property is way overpriced!
November 22nd, 2008 at 8:48 am
I seem to recall the book ” Boom , Bust Echo ” by David Foote and many of his demographic -based predictions.
If not mistaken , he had predicted a Real Estate crash as well.
His view was that there would be a glut of Real Estate in the near future based on decline in customer base,… due to such things as lower birth rates, and that real estate would be picked up for a song.
I don’t recall him basing it on an economic crash per se, it wasn’t so obvious back then, but in hindsight the seeds were sown and germinating back then when his book first came out.
Here is an interview he did with “Investor Canada” from 1999….which is after the Dot.com bomb and just before the Real Estate ramp up.
QUOTE:
” And of course in the 80s, as kids grew they drove up the value of their real estate investments. And now the boomers, their kids in the ’90s have been hitting the stock market and driving the value of all their stock market investments. So the richest people in Canada today are in their 60s, and these are the people who were giving seniors discounts to. Most Gen Xers just don’t understand why we should be doing that. In fact most twenty-somethings don’t understand why we should be giving discounts to the richest people in Canada.”
Entire interview below
http://www.footwork.com/audio.asp
November 22nd, 2008 at 9:19 am
Octagonian
“but by my back of the napkin estimates, with the data I can glean, if you were to subtract West Van from the Greater Van picture, real estate here is in, and likely only to experience, a modest 10 – 15 % drop, peak to floor. West Van appears set to be WIPED OUT.
Please, ANYBODY.. disabuse me of this analysis if you can.”
Well your analysis is wrong, but not in the way you want to hear. All of Vancouver will be wiped out. I don’t know where your “back of the napkin” formulae come from but here’s a few for you.
Monthly rent:purchase price multiples, in a balanced market should be 150 or lower.
P/E ratios should be better than a “safe” investment.
Median home prices should be no more than 3-4x median family income.
All of these point to property throughout Vancouver at 2.5-3x sustainable values.
November 22nd, 2008 at 9:33 am
horrifying bad news for new home owners:
http://tinyurl.com/6zlhbz
just when you thought it was safe to go inside…..
“I suspect the biggest health risk is the psychological and resulting physiological impact of reading and keeping current with all the possible health impacts in our lives,” Wardlaw says.
November 22nd, 2008 at 9:47 am
Latest on Campbell’s Property Assessment freeze:
Vancouver Sun
Don Cayo article
http://www.canada.com/vancouve.....7ea79284f9
Looks like treading water and tap – dancing all rolled into one.
Our assessments come out in about a month. I thought Gordo was trying to create clarity and certainty. Instead, this looks like a set – up be drafted and crafted, ultimately resulting in more losers than winners. I think most Local Gov’ts are in the midst of an orgy of spending…and the RE meltdown has caught them with their pants down. However, rather than long overdue belt – tightening…I see the citizens being set up to maintian the cash flow.
November 22nd, 2008 at 10:05 am
This Just in:
Wave of new Cash Rich BC immigrants help drive UP West Van real estate prices, and hence the National average rises dramatically .
Looking next at Yaletown, rumours of Ritz – Carleton project resurrected.
http://network.nationalpost.co.....-amok.aspx
Be wary of massive oil tankers spontaneously being tied up at Lonsdale Quay and Ambleside Park and even Granville Island
PS Rumours of Bob Rennie coming out of exile/hibernation.
November 22nd, 2008 at 10:25 am
Wow, 67,000 factories closed in the first 6 months of this year in China. I wonder what the tally is as of today?
I wonder how many of those factory owners own real estate in Vancouver?
Crash.
November 22nd, 2008 at 10:43 am
that wasn’t me, someone is posting under my name. It’s absurd to think we’ll see an early 80s style crash, does anyone really think interest rates are going up to 20%?
November 22nd, 2008 at 10:44 am
“there are more than a few econ profs from both SFU and UBC lurking on this and other local blogs.”
Do you happen to be one of them?
November 22nd, 2008 at 11:00 am
patriotz writes:
“So why the hell didn’t any of them say anything in public about it?”
Probably not what you want to hear, but to be frank, no one asked. Isn’t that a recurrent theme on this and other blogs that the MSM has ignored this for years?
And the one time, I was directly asked about real estate in Vancouver in August 2007 in light of the credit crunch and advised that people hold off from purchasing they choose not to run anything on it. Thanks for that, Canwest.
Believe me it has been an extremely frustrating situation…
(ted: I hope that answers your question)
November 22nd, 2008 at 11:08 am
whats with the obsession with the US market? last i checked we were in a different country. i know we do some trading with them, but geez, lets get real!
November 22nd, 2008 at 11:09 am
February 11th, 2008 at 10:36 am
wonder what happens if the U.S. drags Canada into a recession.
Not going to happen. IF the US goes into recession it might have an effect back east, but Vancouver is different, our customers are all over the world and we’re not manufacturing widgets. We are a cultural center like New York or London as much as some of the bears here hate to hear that.
November 22nd, 2008 at 11:10 am
March 4th, 2008 at 11:54 am
Keep on dreaming. If you can buy real estate now but are afraid you should get in while you can. Every time you post one of these stories its like you dont notice the really obvious fact that this news is not about Vancouver and not about Canada. Your stretching for bad news in other countries while real estate here continues to be a rock solid investment.
November 22nd, 2008 at 11:10 am
35 Dosh Says:
January 8th, 2008 at 12:57 pm
The facts are these:
despite a downturn in the US market Vancouver is as robust a market as ever, in fact prices have NEVER been higher than they are now. Complaining about that is like wishing you could still use a payphone for dime. Its simple. Stop throwing your money away, get into anything you can afford NOW and watch your asset grow.
November 22nd, 2008 at 11:11 am
Dosh Says:
January 8th, 2008 at 4:25 pm
Yeah? Well show me a better investment. Even the most dismal forecasts from real estate economists are predicting at the very least a 4% increase in property values. I expect we’ll see a lot higher than that, but if I only get 4% appreciation I won’t be crying in my beer.
November 22nd, 2008 at 11:11 am
April 9th, 2008 at 12:54 pm
Why is this big news? A 25% chance of anything is pretty low, they’re predicting that theres triple the chance that a global recession will not happen.
November 22nd, 2008 at 11:11 am
38 Dosh Says:
September 24th, 2008 at 8:20 pm
Anonymous, at least put a name to your post so we can berate you if you’re wrong on your prediction of maintenance fee increases.
November 22nd, 2008 at 11:12 am
Dosh Says:
October 2nd, 2008 at 4:53 pm
Deja, your a clown. whats your point? that some of my predictions were off? so what? Real estate is a long term investment. Your probably one of those idiots who predicted a 50% drop and prices are down less than two percent from last year. Anyone who bought in 2006 or before still has lots of equity built up.
November 22nd, 2008 at 11:12 am
dosh Says:
December 30th, 2007 at 4:18 pm
So you don’t know when is a good time , but you do know now is not a good time? Where does your knowledge end?
And as far as affordability goes thats an individual thing. How do you know that there aren’t millions of people earning over $100k per year here? The more you have on hand the less of a big deal ‘affordability’ becomes.
November 22nd, 2008 at 11:14 am
NO BUBBLE, NO TROUBLE
SOME OF THE EXPERTS:
http://www.cbc.ca/money/story/.....value.html
Tal:
Tal says the U.S. meltdown is basically a subprime story
http://finance.sympatico.msn.c.....id=7847016
Klump:
As for that perennial bogeyman, the condo glut in Vancouver and Toronto, people have been expecting a crash for years, “and they’ve been wrong,” Klump says. And he believes they’ll continue to be wrong, because condos will remain more affordable than houses, and are likely to grow more appealing as rising gas prices spur people to eschew commutes for staying close to downtown
http://www.lestwarog.com/newsArticle-2033.html
Baxter:
David Baxter of the Urban Futures Institute of Vancouver bluntly says there is “no bubble” in Vancouver.
Rennie
Bob Rennie of Rennie Marketing Systems says: ‘I don’t see any bubble. I look at supply and economic confidence. The fact is we don’t have any oversupply and the fundamentals of a good market are there,” he said.
http://www.straight.com/node/10779
Muir:
CMHC senior market analyst Cameron Muir argued that the province is not trapped in a housing bubble. “We’re nowhere near the kind of price gains that we’ve seen in previous very strong or scary bubble market cycles,” he said. Still,
http://www.canada.com/vancouve.....912aabfed7
Adamanche:
With the Vancouver region experiencing still strong economic conditions, Adamache believes there is still room for prices to rise.
November 22nd, 2008 at 11:16 am
whatever i say do the opposite because I have never been right about anything in my life
November 22nd, 2008 at 11:22 am
keeping an eyes on the pimps,
were you sleeping when realtors and their board were over stating the price trends?Please wake up and tell the pimps some of the following facts that…
Canada’s housing market is fundamentally different from its American counterpart,More than 80% People with supportive fundamental says “NO”we are not going to sell our homes because this is not a good time to sell,We are not going to lose our jobs because our interadependent economy is immune from collapse,Prices are not falling as stated,only sales are dead,As soon buyers will return back to market prices will have to go up that’s the nature of our housing sector,that’s the law in vancouver because VANCOUVER REAL ESTATE NEVER GO DOWN.
November 22nd, 2008 at 11:50 am
Vancouver Real Estate Never Go Down, the price went down $75K for the detached benchmark this year. How are we any different?
November 22nd, 2008 at 12:13 pm
With nuggets of wisdom like these coming from the bulls versus coherent arguments from people who passed grade 6 it’s pretty clear the whole real estate market is going to drop for decades to come
Dosh
“Its simple. Stop throwing your money away, get into anything you can afford NOW and watch your asset grow.”
Krish
“nteradependent economy is immune from collapse,Prices are not falling as stated”
November 22nd, 2008 at 12:28 pm
Nothing stops a realtor from being compensated by the seller and the buyer and any other party. As long as it’s disclosed in writing.
When? At the same time as the presentation of any offer to the seller, or after the offer is accepted by the seller? If the latter it’s still a secret commission and a breach of trust.
November 22nd, 2008 at 12:30 pm
Dosh
“It’s absurd to think we’ll see an early 80s style crash, does anyone really think interest rates are going up to 20%?”
You’ll have to try harder than that. Housing was already crashing when rates shot up.
What’s absurd is people like you who believe our market has become permanently detached from fundamentals.
November 22nd, 2008 at 12:31 pm
Probably not what you want to hear, but to be frank, no one asked.
Nobody asked Paul Krugman, Peter Schiff, or Robert Shiller either.
That is absolutely the lamest excuse anyone calling himself a scholar could ever give.
November 22nd, 2008 at 1:10 pm
I agree Patriotz. Nobody asked Galileo to study the solar system or Darwin to study evolution. Yet they did, and they published it against everyone’s objection at the time and the human race is richer for it.
The purpose of academics getting tenure is so they can freely speak their minds without fear of losing their jobs. These excuses for “academics” either were too incurious or too lazy (or too greedy, in cases like Tsur’s) to understand and speak up about what was happening.
November 22nd, 2008 at 2:05 pm
Dosh, are you on drugs? Bears, is this guy/girl for real?
November 22nd, 2008 at 2:23 pm
Sorry, drachen, but you’re assuming we all have tenure…
And here are some of the things that get you no points:
1.) blogging
2.) forecasting
3.) media outreach
The idea is that you establish yourself in your field first…it’s only after many years that you might have the type of exposure that Krugman and Shiller enjoy (most of us don’t have a blog on the NYT, after all).
I’m not defending the system, just trying to explain some of the constraints that people operate under.
November 22nd, 2008 at 2:47 pm
“A friend of a friend inherited a $4.3 million dollar house in Shaughnessy and so far the only credible offer he’s received was for $1.7..
Which means, of course, he actually inherited a $1.7 million house.”
Which means he actualy inherited a house worth – whatver it actualy sells for – might have been $1.7 yesterday – what will it sell for tomorrow?
November 22nd, 2008 at 4:04 pm
Nobody asked Paul Krugman, Peter Schiff, or Robert Shiller either.
Thats a lame attack, not every economist has access to that kind of media exposure or can get it. It’s not what you say, its what get wide distribution in the media. Many of these guys made their opinions clear for years, is it their fault that the media didn’t distribute that information in equal quantity to the “its different here” dreamers?
It’s been TWO YEARS since TD issued a ‘bubble warning’ on the vancouver real estate market. They were saying we were overpriced in 2006, have we fallen back that far yet?
http://www.cbc.ca/canada/briti.....60404.html
Running an entire section of the newspaper as condo advertising is a lot more profitable than publishing negative opinions from economists.
November 22nd, 2008 at 5:06 pm
“Klump:
As for that perennial bogeyman, the condo glut in Vancouver and Toronto, people have been expecting a crash for years, “and they’ve been wrong,” Klump says. And he believes they’ll continue to be wrong, because condos will remain more affordable than houses, and are likely to grow more appealing as rising gas prices spur people to eschew commutes for staying close to downtown.”
*******
Err, that would be the “rapidly falling” gas prices, no? At least over the past 3 months.
(Yes, I know that long term they will rise again, but Klump really should get his facts right.)
November 22nd, 2008 at 5:31 pm
Smart realtors have their ” FOR SALE” signs listed as
” NEW PRICE ” ( sounds more positive via its ambiguity )
not ” PRICE REDUCED ”
(baaaaddd. sounds more like day – old bread /expired dairy products and simply trolling for sucker buyers )
November 22nd, 2008 at 6:17 pm
The best news around is that all you bitter renters will soon be out of work as well as out of money thanks to the stock market crash. Meanwhile us owners and investors will be cruising around in SUVs eating fancy peperoni sticks and drinking good beer. Enjoy the tuna sandwhiches renters and thanks for paying for my lifestyle. Us owners warned you about the pitfalls of renting and you still lost it all.
November 22nd, 2008 at 6:36 pm
A friend of mine went to an open house at 57th and Oak in Vancouver. Asking price $1.7 million.
When he got inside, he knew it wouldn’t sell for that… so he spoke with the listing agent and told her he thought she was wasting her time and he half-jokingly said to her that he figured it was worth $900k… she replied, “will you write an offer?”
November 22nd, 2008 at 6:49 pm
I’m # 100 …..I tink
November 22nd, 2008 at 7:26 pm
I don’t know why someone is bothering to dig up old quotes out of context, I still stand by what I said. Yes, the market is seeing a minor correction right now, but what did you expect when we have a global economic crisis? Just because we see a temporary dip in the market doesn’t mean all of your worst-case scenario predictions are coming true.
November 22nd, 2008 at 7:40 pm
John, I think that if RE doesn’t get you, your gluttony will.
November 22nd, 2008 at 7:40 pm
“Just because we see a temporary dip in the market…”
Dude, ALL dips are temporary unless they are permanent. Stalingrad was a “minor setback”. See you in Berlin.
November 22nd, 2008 at 7:52 pm
Dosh are you joking around and pretending to be the stupidest person alive, like John, or are you actually serious?
How many condos have you bought lately?
November 22nd, 2008 at 7:53 pm
35 Dosh Says:
January 8th, 2008 at 12:57 pm
The facts are these:
despite a downturn in the US market Vancouver is as robust a market as ever, in fact prices have NEVER been higher than they are now. Complaining about that is like wishing you could still use a payphone for dime. Its simple. Stop throwing your money away, get into anything you can afford NOW and watch your asset grow.
November 22nd, 2008 at 7:55 pm
Dosh
“what did you expect when we have a global economic crisis?”
I guess you didn’t notice that the slide in local real estate started before the other problems?
You are a joke. The funniest part is you won’t even get the punchline for another year or two.
November 22nd, 2008 at 8:07 pm
Thats a lame attack, not every economist has access to that kind of media exposure or can get it.
Who gives a flying f#ck how much access the academics had to the mainstream media. They didn’t even raise the issue within their own circles.
Oh by the way, there was nothing to stop these people from posting under their own identities on this or any other website, or starting one themselves. Or submitting articles to Tyee or similar online publications. Or making use of that ancient institution, the letter to the editor.
Do a little bit of googling on Chris Thornberg to see how a little-known academic can raise the issue if he really wants to. This one man puts the whole academic community in Canada to shame.
November 22nd, 2008 at 8:10 pm
Dosh, if you have been quoted out of context then find one thing you’ve ever said that wasn’t 100% wrong and paste it here.
The market is already down 50% Where have you been?????
This has nothing to do with the credit crisis. This has been an ongoing discussion on this blog for years and you were here reading along but it obviously didn’t get into your thick skull. Luckily t morons like you enabled a a few spculators to get in and out with some money leaving the fools like you economic slaves for life.
You might not understand the term economic slave yet but you will figure it out when you go to increase your line of credit in order to pay your mortgage and they laugh.
Then you’re $10/hr job won’t even pay the mortgage and you’ll end up having to rent your room out and sleep in the “generous flex room” ,that most people consider a closet, for the next 40 years while spending 99% of your income on an asset that will never increase in value.
November 22nd, 2008 at 8:28 pm
Here are some dots to connect.
Last Spring, (Spring being the highest selling season) we had;
- no credit crisis
- no stock market meltdown
- no confimred recession anywhere that matters on Earth
- high employment
- loose credit
- a recent history of double digit price increases
- an eonomy humming along
- a tremendous amount of infrastructure spending
- irrational exuberance on the buy side (at least until the very early Spring)
Next Spring, we will have the reverse, on all counts. What do suppose might happen?
November 22nd, 2008 at 8:44 pm
Went out to visit some lonely realtors this weekend. Same as always, there they were bored and alone sitting at open houses. What a change from a few years ago when there were lines out the door!
The realtors all told me I’d better buy ASAP because come spring everyone who is currently sitting on the sidelines is going to rush out and make offers, thereby sending prices sky high again. Hurry hurry, no time to waste!
November 22nd, 2008 at 9:05 pm
I had a funny (to me) interaction a few weeks ago. A guy was complaining about a house he and his wife had bought in PoCo from a builder presale that completed recently. Surprise, the unsold units were now going for $30,000 less. He was royally pissed. Another FB, I thought.
Then he mentioned where he worked. A Lamborghini dealership. Gulp. How’s business? I asked. Ah, fine, he said, his voice shaking imperceptibly. Yeah, sure, those sales are going to hold up when the wealthy have just lost 47 per cent of their life savings and 10 per cent of their home values and sinking… Tanking sales, depreciating house: good times, good times. You couldn’t pay me to be a homeowner now!
November 22nd, 2008 at 9:06 pm
I went out to South Surrey today to look at an acreage. It is a foreclosure and the assessment price is $1.4 m but the asking price is $800K. The lot has an old house on it that is practically falling into the river. There was a little caterpillar on the property. It looked like the city had sent someone over there to put some fill in behind the house. I don’t know if the city would be responsible for building a badly needed retaining wall or if the buyer would.
Well, anyway, it looks like the owner there bought the place in 1995 for $476K and then took out a few helocs ($200 in 2001 and then $700 in 2006) and was able to do so because the surrounding lots have huge expensive houses on them and the assessment of said lot was based on a computer comparison and not the actual value of the lot.
So now the bank is trying to get $800K for a lot that is worth about $4-5K at best.
The realtor told me that this is a case of financial error “like what happened in the states”.
Interesting….
November 22nd, 2008 at 9:09 pm
Oh, btw, the realtor also told me that acreages and building lots are tanking in Surrey/Langley. They are all listed 25% below assessment and still aren’t moving.
The realtor said it is because of slump in development.
November 22nd, 2008 at 9:15 pm
-
A Sea of Unwanted Imports
“This is one way to look at the economy,” Art Wong, a spokesman for the port, said of the cars. “And it scares you to death.”
November 22nd, 2008 at 9:38 pm
The realtor said it is because of slump in development.
Well of course, the only reason land is worth anything is because it can be developed. The farther in the future the development the lower the present value.
November 22nd, 2008 at 10:54 pm
Octegenarian: “[...] but by my back of the napkin estimates, [...] a modest 10 – 15 % drop, peak to floor. [...]
Please, ANYBODY.. disabuse me of this analysis if you can. [...]”
It is impossible to disabuse you of your analysis because you have not performed one. You have simply made a statement. For your statement to be of any value it must be backed up by argument, which constituted the analysis.
This is something that annoys me endlessly about the pundits on TV. In their wisdom they are constantly throwing out numbers predicting the future, but they very rarely back up their numbers with any sort of analysis.
November 22nd, 2008 at 11:54 pm
Please, ANYBODY.. disabuse me of this analysis if you can.
When the November numbers come out from the REBGV the benchmark will be 10-15% off-peak. Do you really think that will mark the end of this bust?
Will that do?
November 23rd, 2008 at 1:45 am
FYI, Harper is calling this the worst economic crisis since the Great Depression:
The crisis is “unlike and potentially as dangerous as anything we have faced since 1929″ – Stephen Harper
http://news.sympatico.msn.ctv......eru_081122
November 23rd, 2008 at 3:06 am
And what was the cause of that Steve? Lending against overpriced RE assets, right? You didn’t have anything to do with that, by any chance?
November 23rd, 2008 at 3:32 am
From the NYT article: “But the inventory glut in Long Beach is not limited to imported cars. There has also been a sharp drop in demand for the port’s single largest export: recycled cardboard and paper products.”
So let’s get this straight: up until recently the US was importing Toyotas and Mercedes in exchange for recycled cardboard and paper. And yet nobody saw the economic collapse coming?
November 23rd, 2008 at 3:52 am
May 27, 2005:
“Now the question is what can replace the housing bubble.
Nobody thought the economy could rely forever on home buying and refinancing. But the hope was that by the time the housing boom petered out, it would no longer be needed.
But although the housing boom has lasted longer than anyone could have imagined, the economy would still be in big trouble if it came to an end. That is, if the hectic pace of home construction were to cool, and consumers were to stop borrowing against their houses, the economy would slow down sharply. If housing prices actually started falling, we’d be looking at a very nasty scene, in which both construction and consumer spending would plunge, pushing the economy right back into recession.
That’s why it’s so ominous to see signs that America’s housing market, like the stock market at the end of the last decade, is approaching the final, feverish stages of a speculative bubble.”
http://www.nytimes.com/2005/05.....an.html?hp
November 23rd, 2008 at 6:59 am
Good article Patriotz
Pretty much says it all. Sure verifies many of my own suspicions. I liked these quotes as well
” In July 2001, Paul McCulley, an economist at Pimco, the giant bond fund, predicted that the Federal Reserve would simply replace one bubble with another. “There is room,” he wrote, “for the Fed to create a bubble in housing prices, if necessary, to sustain American hedonism. And I think the Fed has the will to do so, even though political correctness would demand that Mr. Greenspan deny any such thing.”
“As Mr. McCulley predicted, interest rate cuts led to soaring home prices, which led in turn not just to a construction boom but to high consumer spending, because homeowners used mortgage refinancing to go deeper into debt. All of this created jobs to make up for those lost when the stock bubble burst”.
It is often not a matter of if but when. When “when” happens, the longer its been delayed the worse it inevitably gets.
November 23rd, 2008 at 7:04 am
That was a good story on the acreage. Home equity loans or loc’s will and already are becoming disastrous. Who are the geniuses who came up with that? You know you’ll be hearing that it was based on “prices always going up”. Our banks are in for a shock when this house of cards they helped create, tumbles down. Just insane.
Rather than boast about how they’re in “relatively good shape” they should stay humble, for the worst is yet to come. Once prices drop below the amounts owing against the homes, the banks will scramble. Looking for liquidity anywhere they can. No wonder the gov’t keeps tossin money their way, they know.
November 23rd, 2008 at 7:17 am
RE: Chris Thornberg:
” Economist Chris Thornberg criticizes $700 billion bailout plan
President Bush has signed the $700 billion plan to rescue the battered financial industry. The U.S. House passed it this morning, two days after the Senate approved it. Economist Chris Thornberg has criticized the plan since it surfaced late last month. He told KPCC’s AirTalk he doesn’t think the new version is much different from the plan that the House rejected on Monday.
Chris Thornberg: “Doing public policy on the basis of the drama queen known as the stock is a recipe for a disaster. All right. The market dropped on Monday, it popped back up on Tuesday, it went back down on Wednesday. I mean you can’t run a nation like that, it’s ridiculous.”
Stock = Drama queen? Bang on analogy !
Diane Francis summarized the Stock Market as much like measuring the “blood pressure” of the economy. This continual up -an -down “yo yoing ” is not good for the patient. Stability is what is needed.
November 23rd, 2008 at 9:39 am
So why are they sitting there all mum and letting us “layman” do all the heavy lifting?
My experience is with “economists” such as Pastrick who kept coming back with more crap as we ripped him and his illogic apart. Than there is Tsur, but he isn’t an economist.
Why could we see this sh*t storm coming from a mile away? I understand that many “experts” were fooled by the ratings agencies incompetence, but where is the due diligence? Common sense tells you that when pool boys can buy multiple million dollar properties, there are problems in the risk control department. Investigate the red flags for Christ’s sake. Having failed to do so, you have no right put your mug in the MSM saying all is well blah blah blah. Thank god for Peter Schiff et al. I truly hope some high profile program like 60 Minutes does an episode on the all those wankers. Put them all in the same room as Schiff and some angry investors, lenders, homeowners, autoworkers and see if they are still laughing.
November 23rd, 2008 at 9:40 am
My last comment referred to the following quote:
“Trust me…there are more than a few econ profs from both SFU and UBC lurking on this and other local blogs.
November 23rd, 2008 at 10:01 am
OK freako, but after we got them in the same room, let’s lock the doors and drop the gloves.
November 23rd, 2008 at 10:09 am
Forgert about the gloves, just fire up the chainsaws….and let’s throw a few realtors into the mix.
November 23rd, 2008 at 10:23 am
I have a question for everyone on this blog.
If one can get a piece of real estate right now in the lower mainland for 50% off the assessed value, would you take it or would you hold out for a 60 or 70% decline. This is providing you really like the place, it fits your dream, and you can make the mortgage payments under the 6.5% for 10 year term, 25 year mortgage conditions. Also you have the option to rent out a suite if you need to get extra money in the future.
Please comment.
November 23rd, 2008 at 10:29 am
Anon,
Assessed value is meaningless.
Hold out for the 70% drop.
You ain’t seen nothing yet!
November 23rd, 2008 at 10:30 am
You’ve heard people say it before: price the market, don’t time the market.
November 23rd, 2008 at 10:43 am
Browsing the rental listings right now and it appears a lot of places are coming down in price and there is a lot more.
Who saw this coming???
More than 50% of the stock coming online was intended to be rented out and the other 50% were buyers who’re vacating another unit (rental or owned) and the ownership ratio is 70% in B.C. (I read that here and never fact checked it).
So now there are another 2,500 new units coming this year and they’ll be thousands of units going up for rent, once the owners realize there are no rich asians coming to buy them….
Saturday my Wife and I went shopping on Robson street and it was dead plus we got big discounts on everything. The only place that was busy was the Wendy’s on Alberni!
This scared me, the economy is going to choke itself out.
Attention bitter renters get out there and spend some of your savings or this’ll get much worse. Banana Republic & Club Monaco both had sales running about 50% in the first week of Christmas Shopping and the they were still dead!
When we got home I checked the mail and the Wynn wants us to come back to Vegas for $169/night (half price).
I’m seeing a theme here, everything is dropping to HALF PRICE!
It’ll be easy to tell the bitter renters on the street soon because they’ll be the best dressed and won’t look like they’re about to have a nervous breakdown, sporting a tan from their recent vacation…
November 23rd, 2008 at 10:45 am
http://www.canada.com/theprovi.....3d5347382e
Dubai in trouble
November 23rd, 2008 at 10:47 am
Assessed value is truly meaningless and will be for the next decade IMHO. It is a falsly inflated figure used by municipalities to generate tax revenues.
Our FIAT currency will soon be worth it’s real value…..which is zero.
The USA is BK and on life support from the world’s governments and central banks…..unfortunately, the problem is, said world institutions are also headed downwards into the abyss with the same problems as us.
Consumers are just not buying anything but essentials, companies are failing everywhere, jobs are being lost, housing prices are falling, RE sales are drying up dramatically, stockmarkets have collapsed.
If you need an answer to that question…….you are pretty clueless.
November 23rd, 2008 at 10:53 am
The fact of the matter is, most people, even those who should know better, do not necessarily always make decisions by the book. Even if there are warning signs, it may not be enough to counteract group think. It takes time to analyze things from the ground up and easy to miss things, especially under the influence of social peers, which is why blogs are such a good medium to tear down or build up predictions.
But I agree, I have no respect for some of these so called experts. They have access to the data and are supposedly trained to know about such things but still go on the media to make vague and incorrect predictions and arguments which have blatant holes in them. It would have only taken a few influential experts to make a few small corrections a few years ago to prevent this whole mess.
November 23rd, 2008 at 10:53 am
Freako–how does #125 relate to the bit about econ profs? In 125 you are talking about economists like Pastrick, who is most certainly not an econ prof.
November 23rd, 2008 at 11:22 am
MickeyFinn Says:
A friend of mine went to an open house at 57th and Oak in Vancouver. Asking price $1.7 million.
When he got inside, he knew it wouldn’t sell for that… so he spoke with the listing agent and told her he thought she was wasting her time and he half-jokingly said to her that he figured it was worth $900k… she replied, “will you write an offer?”
The message is loud and clear: Ignore asking prices, and lowball LowBall LOWBALL.
I think I’ll start my wanderings around RE open houses and asking listing agents if they’ll consider 50% of the asking price. May as well get in now (right Dosh?) by price pre-empting the market.
November 23rd, 2008 at 11:48 am
carioca canuck: don’t be such a bloody zealot all the time.
November 23rd, 2008 at 12:09 pm
http://www.theglobeandmail.com.....y01?slot=1
November 23rd, 2008 at 12:19 pm
As in the United States two years ago, ‘we are now seeing completed units pile up unsold in Canada, a clear sign of overbuilding and an ominous sign given the voluminous supply still in the pipeline.’ And there appears to be no sense of alarm among policy makers while ‘we ourselves are getting more alarmed by the day.
experts have warned recently of an ‘ominously high correlation’ between price movements in Canada and those in the United States two years ago. They cited evidence that bolsters the view that the Canadian market appears be tracking the U.S. market with a two-year lag.
November 23rd, 2008 at 12:59 pm
“So why are they sitting there all mum and letting us “layman” do all the heavy lifting? ”
My thoughts on this are that the world of economics is a pretty complicated place and many people who are in academia are most likely involved in very specific areas of obscure economic theory. Real Estate markets are probably studied by few as a person in the field will personally gain more by focusing on some very narrow specific and technical aspects to get approval from their peers.
November 23rd, 2008 at 1:14 pm
bdk Says:Dubai in trouble
Thanks for the link…I was wondering when that particular bubble was going to pop; happened sooner than I thought.
Those the gods would humble, they first make proud.
November 23rd, 2008 at 1:19 pm
Dubai: Tower-of-Babel style hubris, and we all know how that story turns out.
November 23rd, 2008 at 1:39 pm
http://www.europac.net/externa.....p;id=14713
The truth about bailouts………
November 23rd, 2008 at 2:34 pm
I was speaking to an acquaintance in the banking industry who warned me to steer clear of Vancity. She said that they’ve lost a bundle in all the current turmoil and that their days are numbered.
Has anyone heard anything concrete about these guys?
November 23rd, 2008 at 2:35 pm
Ya, nobody knew it was coming.
That is why Bernanke took over from Greenspan who, just by coincidence, happens to have studied the Great Depression in depth.
Undoubtedly boned up on worst case scenario.
IMAGINE IF THERE WERE NO BAILOUTS.
We would be groveling around the trash cans for food.
They knew. DUH.
November 23rd, 2008 at 3:34 pm
RE: Post 132
I guess this is an early sign on the ground of the deflation many expect to come?
I didn’t study economics in school, so much of this is over my head, but how plausible does everyone think it may be for central banks to stave off deflation in this downturn? The most recent example I look to where a somewhat similar situation developed was when Japan’s asset bubble burst, and the country had its “Lost Decade” (and then some!) of rampant deflation. The Bank of Japan eventually brought their interest rates to 0% (and even symbolically lowered into the negatives for a time), and it didn’t seem to do much over there.
Some of the articles that I’ve read comparing Japan’s bubble bursting to what’s going on in the U.S. suggest that because Japan acted slowly in dropping interest rates, this compounded the problem, and that because Bernanke and the gang have been swift to drop rates, it would be beneficial to the U.S. However, it still seems that the specter of deflation is looming as the MSNBC article that The Pope linked to suggests. Will continuing to drop the interest rates at central banks have much effect in this case?
Also in regards to inflation vs. deflation, iTulip recently posted an interesting article weighing the possibilities. A lot of what they discuss went over my head, but I’m trying to wrap my mind around it. It’s something others here may want to read if they haven’t already:
http://tinyurl.com/6ntbpl
In any case, I’d be interested in hearing what other folks here’s perspective is on the whole inflation / deflation argument. =)
November 23rd, 2008 at 3:45 pm
Bro: your friend wouldn’t happened to be employed by CIBC, by any chance. Champion In Banking Collapse (CIBC) hehehe
November 23rd, 2008 at 5:07 pm
anon Says:
November 23rd, 2008 at 1:19 pm
Dubai: Tower-of-Babel style hubris, and we all know how that story turns out.
========\
Aw crap, not more languages to learn…
November 23rd, 2008 at 5:18 pm
Registered my name now because unfortunately, somebody was impersonating me at Rob Chipman’s blog.
Anyways, back to the topic, it looks like November sales are cratering. According to Kopyrightklepto’s projections, on Paulb’s numbers, we may not even hit 1000 sales for November:
Listings: 3257 (-8% yoy)
Sales: 913 (-69% yoy)
Sell/List: 28% (-56 pts yoy)
MOI: 21.6 (473% yoy)
Actives: 19691 (77% yoy)
http://www.realestatetalks.com.....p;start=30
Under 1000 sales for REBGV is a disaster. Prices are imploding now because the sales are off a cliff.
November 23rd, 2008 at 5:36 pm
“Registered my name now because unfortunately, somebody was impersonating me at Rob Chipman’s blog.
Boohoo, gadwin. Maybe you should go tell your mommy.
November 23rd, 2008 at 6:14 pm
Gadwin, I feel your pain. You must be furious. How dare someone take your fictitious name.
Please give the address where we can send our donations.
You poor thing.
November 23rd, 2008 at 6:48 pm
Pope: how can I register my name? People keep stealing and posting under it.
November 23rd, 2008 at 6:52 pm
Pope: I think there is a bug in the system.
Gadwin seems to be demoding my postings multiple times when he doesn’t agree with them.
Please check his IP address and how many times he is voting.
Thanks.
November 23rd, 2008 at 7:27 pm
Thanks everyone for the star on posting #112 and thanks for your advice on #129. I appreciate it.
Gadwin: Grow up!
November 23rd, 2008 at 10:14 pm
Freako–how does #125 relate to the bit about econ profs? In 125 you are talking about economists like Pastrick, who is most certainly not an econ prof.
True that. I just felt like going on a rant. I hit Helmut’s bio, and there is no title at all. What’s he got? A bachelor’s in Economics?
November 23rd, 2008 at 10:26 pm
Check Paul B’s latest weekly prices.
http://www.nvcondos.realpagema.....?aPageId=9
It looks a huge chunk has been taken out of both SFH and condo median prices in the last week. SFH down 17% and condos down 14%. I know this could be blip, but it happened to both at the same time.
At this pace, I’ll have to buy a house by Christmas.
November 23rd, 2008 at 11:38 pm
Assessed value is truly meaningless and will be for the next decade IMHO. It is a falsly inflated figure used by municipalities to generate tax revenues.
You don’t understand how property taxation works in BC. Property taxes equal local government spending. They are not a function of assessments. Anyone who has owned a property through the RE cycles of the last few decades knows this perfectly well.
Assessments are not perfect, but there are the best (actually the only) universal estimate of market value we have. If there were systematic overassessment there would also be large-scale appeals. The people doing the assessments aren’t dumb, they don’t want people appealing, and they try not to overassess. As I have already pointed out, overassessment does not result in increased property tax revenues. Also assessment is not done by the municipalities, but by the BC Assessment Authority.
Getting back to the original question, I’ll buy when I see a property I like at rent equivalence (all expenses). I’m buying for long term and I don’t care about future price movements. It’s about the yield.
November 24th, 2008 at 4:27 am
I was reading stuff over at http://www.johnchow.com. He has a post where he tours an unfinished home in West Vancouver. 7000 sq. ft. for 3.5 million, down from 6. One of the commenters says:
“It’s a buyer’s market, especially for higher-end homes like these. Snatch it up and rent it out to international millionaires when they visit for 2010.”
I wonder how much of the 3.5 million you would recoup renting the house out for the Olympics?
http://www.johnchow.com/house-.....y-estates/
November 24th, 2008 at 5:49 am
Patriotz: The higher the assessment, the higher the taxes, you can’t argue with that.
November 24th, 2008 at 7:05 am
Economist ? = are psychologists that can do Math.
Most of these experts are hired to provide some credibility to the message they are hired to spoon feed the public.
They are fully aware of the herd mentality and how the truth and ” news ” affects herds. Since the early 1990′s these ” economists ” must have been aware that much of the domestic and international economy was based on bubbles….they should have seen this latest bubble coming, and thus they are either lying through their teeth or truly ignorant.
A lot of these professionals travel in packs , joining the given bandwagon, continually selling themselves out. Any idiot can report the obvious when times are good, but when times are bad or tanking, why sugar coat it ? That’s what I see their role as.
November 24th, 2008 at 7:30 am
Anyone else here the economic alice-in-wonderland boosterism taking place on cknw 980 this morning? They’re giving their staff a 1/2 day off to go shop with in their advertisers’ stores. Apprently the dire economic times are all in our collective heads. We ARE different from the US. If we just went out and spent more all the bad news would go away.
Do you reckon mgt. got together with stuff and asked them to run this shameless fluff or maybe face job cuts down the road?
November 24th, 2008 at 7:40 am
Low prices mean the best time to buy real estate is now. I see deals everyday and so can you if you look. Do you want to make money and get rich? Then get off the couch and away from computer and start shopping. The doer gets rich not the loser.
November 24th, 2008 at 7:40 am
meant to “hear”, too early for me i guess
November 24th, 2008 at 7:46 am
Back of the envelope stuff
GVRD detached Benchmark price for last month was 695,962 from realestate board MLSLink Housing Price Index
Paul B median house price from weekly stats for three weeks in Nov (ending Nov 22) are 630,000, 660,000, 547,500 or an AVG of 612,500
695,962-612,500=83,462
83,462/695,962=11.99% DECLINE
Understand the shortcomings of Median prices but lets not forget the shortcomings of Benchmark … I use a blended rate.
November 24th, 2008 at 8:04 am
B.C. apartment sales drop by half
VIRGINIA GALT
Monday, November 24, 2008
The commercial market for apartment buildings in British Columbia has “come to a near standstill,” according to a report issued Monday by real estate firm Avison Young (Canada) Inc.
“There is now a standoff between purchasers, who in the wake of the global credit meltdown have changed their pricing expectations, and vendors, who are looking for yesterday’s pricing in a much more challenging market,” Avison Young principal Rob Greer said in releasing the report.
The number of real estate transactions in British Columbia’s “multi-family market” has dropped to 76 so far this year, down from 153 in the corresponding period of 2007, according to a survey by Avison Young.
“The total value of multi-family investment transactions year-to-date … amounts to $270-million – approximately 52 per cent of the $519-million recorded in all of 2007,” Avison Young said.
Local private investors accounted for the majority of buyers and sellers in 2008.
Prices for apartment buildings are likely to fall even more next year, Mr. Greer said.
“Should financing troubles continue through 2009, we may see values move as much as 20 per cent as investors re-evaluate their required returns on investment,” Mr. Greer said.
Avison Young said in its report that the “once prevalent multiple-offer situations have shifted to ones of price reductions and lingering listings.
“Of the current 130 listings on the market, approximately one-quarter have received at least one price reduction in recent months. This does not include any recent sales that involved a price reduction to induce the sale,” according to the report.
Michael Brodie, an adviser with Avison Young, said tighter credit has hurt the commercial real estate market in B.C. and elsewhere in Canada.
“The inability to get yesterday’s lending has driven many potential purchasers from the market simply because they don’t have enough equity,” Mr. Brodie said.
Credit issues will also hurt “highly-leveraged” building owners who have to refinance in 2009, said Mr. Greer.
However, he said, B.C.’s market has not been affected as significantly as other markets, and apartment buildings are still among the most stable commercial real estate investments.
“Housing is also one of the last places people stop spending money, and we can expect the region’s average rental vacancy rate, currently less than 1 per cent, to remain at historically low levels,” Mr. Greer said.
Mr. Brodie added that “investors requiring high leverage may be sidelined for now, but even if the credit markets remain tight for the foreseeable future, multi-family assets should perform well operationally and provide relatively stable cash flows.”
© Copyright The Globe and Mail
November 24th, 2008 at 8:32 am
PATRIOTZ SAID…..”If there were systematic overassessment there would also be large-scale appeals.”
—————————————————
I live in Calgary. That is how it works here. We have entire industries that specialize in doing nothing but corporate and personla tax appeals.
Altus Group….Deloitte……Rickard Realty Group…..CV Group…..et al…too many to list. One of my clients runs Altus and told me he has never been busier in the last 18 months and is almost booked solid now for 2009……the city lets many of them right to court where they usually lose. Our socialist gubmint here in Calgary is tax hungry and the population revolted last week.
November 24th, 2008 at 8:56 am
Our socialist gubmint here in Calgary is tax hungry and the population revolted last week
The city government in Calgary is “socialist”? Didn’t Ralph Klein use to be mayor? What happened, did you get a huge influx of pinko voters from Saskatchewan or something? Has a single NDP MLA or MP ever been elected in Calgary?
If Calgarians are so up in arms, why did only 19% of the voters turn out for the last civic election?
BTW if you consider Calgary city council “socialist”, what would you call Lula?
Patriotz: The higher the assessment, the higher the taxes, you can’t argue with that.
Yes I can. If everyone was assessed at double market value, everyone would pay the same amount of taxes. The only thing that matters is what % of the total assessment base your property is. That determines what % of taxes you pay.
If you want to pay less city taxes, elect a city government that spends less money. And for those of you who lived in Vancouver in 2003, voting “no” to the Olympics would have been a good start.
But I have a funny feeling that the people who are bitching the most about taxes are the same people who were the biggest Olympic boosters.
November 24th, 2008 at 9:04 am
Richmond Council changed the OCP for the City Center, effectively turning the light industrial commercial area into Hi Density.
This created huge tax increases based on ” highest and best use” designations and many owners and tenants organized to seek tax relief. Knowing some of them …I found out that the assessment did not change, but apparently the Mill Rate was adjusted a bit, but not much . One can try to hire a private firm to review the assessment ,….but apparently these tactics do not meet with much success. I have been to appeal boards several times(and won some minor victories)…and in my view it is a waste of time…given the work/ reward ratio.
These private firms have all sorts of rates, I hear some charge 1/2 of what you saved in increased taxes. However, unless mistaken, if one owner in a certain category wins an appeal, the result would be applied to others in the same situation , thus one pays while all the rest gain from their efforts. Then , in all liklelihood, Mill rates for other categories rise, to make up the slack, as we have to keep in mind Local Gov’ts will have determined a budget,need $X per fiscal year , and will get it one way or the other.
However, like Carioca Canuck implies, maybe the issue is not so much the assessment , but the Mill Rate, which is simply a multiplier variable based on your Local Gov’ts wish list and how to fund it.
Perhaps taxpayer revolts demanding Local Gov’ts buy a lot of sharp pencils , proof of more bang for the buck and less pissing tax $$$ down a rathole will be more constructive than appealing assessments.
November 24th, 2008 at 9:25 am
A friend sent me a list of every sale of a single family home on the Westside of Vancouver in the last 30 days… there have been only 16 sales… so given that there are still over 900 active listings it implies close to 60 months of inventory.
I will cut and past the details of the last 30 days of sale here but I do not know if it will work.
List Sold Decline %
839,000 810,000 29,000 3.5%
859,000 800,000 59,000 6.9%
1,048,000 1,038,000 10,000 1.0%
1,148,000 928,000 220,000 19.2%
1,198,000 1,050,000 148,000 12.4%
1,198,000 1,040,000 158,000 13.2%
1,199,000 1,120,000 79,000 6.6%
1,249,000 1,100,000 149,000 11.9%
1,268,000 1,220,000 48,000 3.8%
1,588,000 1,450,000 138,000 8.7%
1,798,000 1,558,000 240,000 13.3%
2,090,000 1,950,000 140,000 6.7%
2,198,000 1,980,000 218,000 9.9%
3,150,000 2,800,000 350,000 11.1%
4,380,000 3,550,000 830,000 18.9%
4,780,000 3,550,000 1,230,000 25.7%
29,990,000 25,944,000 4,046,000 13.5%
November 24th, 2008 at 9:27 am
“The higher the assessment, the higher the taxes, you can’t argue with that.”
Not true. If our local government decides to spend EXACTLY the same amount as last year, but EVERYONES assesment doubles, thier taxes will remain the same. If one half of the cities assessment doubles and the other half remains the same then the doubled assessments have to take on a higher portion of the tax burden.
Assessments here only matter in relation to other assessments. We’re different from California in that way.
November 24th, 2008 at 9:28 am
Major Olympic sponsors bailing ?
http://www.businessweek.com/gl.....l+business
Maybe this is a harbinger of things to come, and that the Olympic movement is becoming over-ripe. The Global economy has over-saturated brand names, and many think the Olympics is a waste of resources. Given the IOC gypsy/bandits have raped and pillaged just about every major country now that China has just hosted them in 2008 , perhaps people will have connected the dots and see the litany of lies and debt once the Olympics side show leaves town.
Maybe public floggings will make a comeback…for any politician that even dares suggest an Olympic bid be submitted, given many will see it is a big negative simply funding political egos.
Toronto was a bit pissed when they lost the 2008 games to Beijing, but maybe Toronto is heaving a collective sigh of relief…given the summer games cost Billions, their economy is tanking, and the last thing they need is is an additional 30 year fiscal debt “hangover” like Montreal had since 1976 Olympics. They played the 2008 Grey Cup in the Big “Owe” ..but what else do they do with that white elephant from 1976?
I think its a given that with BC economy down…we will see an increase in 2010 Olympic boosterism as a desperate by BC Gov’t in an attempt to deflect attention and keep people upbeat. The danger Gordo runs is people seeing through this type of classical smokescreen tactic by Gov’ts and simply expediting a revolt by the masses.
November 24th, 2008 at 9:36 am
Patriotz…..
Yes, unfortunately we have had an influx of eastern liberal types (due to economic immigration) in the last 3 years. Sorry to say…..
Our current Mayor, Dave Bronconnier, is a red liberal to the core, and was thinking about running for the provincial party’s top spot, but declined…..half of city council plus the one vote needed to rule, is uber left wing…….
I don’t know why no one showed up to the civic election either, except to say that perhaps good ‘ole voter apathy was the reason……Vancouver only had 22% voter turnout in your recent civic election IIRC……go figure eh ? And look what the result was there. A christmas cake got elected mayor.
What happened here was that Bronconnier wanted a 9.5% property tax increase to pay for the city budget ($500 a year per home), and as a result people got so pissed off (the city hall hearing room was overflowing outside in the halls, with around 800 people showing up in a room that holds 300, on consecutive hearing days, phones were ringing off the hook, etc) that they cut the tax increase back to 5%……
But it is not over yet, they want to build a $1.5MM gym for city hall staff whenthey can drive 5 minutes, or walk 15, to the best one we have here, and a couple of $25MM foot bridges over the Bow river…..people here are really pissed off now…..and the mayor is really kissing ass and sucking wind.
Lula is a communist. Commies call themselves “socialists” because communist is a bad word. Socialism is the same as communism, but without the guns and gulags.
Lula is toast. In September’s Brasilian legislative elections, the PT Party (Lula’s party) lost their seats in every in every population center over 200K……the only people who voted for him were the outright poor who live in the NE of Brasil, and who get handouts for free from his government. I’m not saying helping the poor is bad, just stating a fact.
November 24th, 2008 at 9:42 am
Assessed value is a true certificate which give the bank an idea to allow further loan to the applicants,bank runs similar method to assess current market value through appraisal agencies.
Any area that countinue earn appreciation also help to add more value into assessement i.e.100%+1 to 15% then banks keep 25% on hold and the left over amount get passed to the applicants in case of guarenteed expected appreciation bank can pass more part of 25% to the applicant or bank can hold more part otherway around.
Assessed value is best method to measure current market value than the hpi by the real estate board because board is unable to take a solid grasp of sold properties in any perticular area but city gets hard factual information in their system a recorded value of multiple units sold in any perticular area at any perticular time.
Tax is not based on assessed value but tax is based on the future budget for city and where to get that money from when city figured out how much money they want to generate through perticular channels then it’s easy to calculate total amount through assessed value.
In 2007 and 2008 there was no big change in property taxes.
In the side note “buyers who did not shop for home yet are starting to trailing behind who ever did a complete shopping”.-Flash1.
November 24th, 2008 at 9:48 am
Why buy when you rent a large Westside family home for $2000?
http://vancouver.en.craigslist.....07022.html
That’s cheaper than many suburban homes in places like Coquitlam and its not the first time I’ve seen a Westside deal like this.
Yet Westside real estate is always so much more expensive…for now. This just shows you how little there is to justify million dollar tear-downs.
If I had kids, I’d rent a place like this and send them to one of those nice Westside schools.
November 24th, 2008 at 9:51 am
Mickey Finn:
Re the sales…
Do these sales simply reflect the transfer date ?
I other words, all or some of these sales you noted may have been negotiated before the RE crash, but what we see is that the sale has actually completed (and shows the other data associated with it).
I think the next few months will show even more major drops in the categories of “List” vs. “Sold” and Decline %, and thus they will be more reflective of the impact of the RE meltdown.
Re That house at $29.9 Million (list) selling for $25.9 Million (ie sold for $ 4 Million less) kind of indicates to me they still sold an overpriced listing to a sucker purchaser who may be on the railings of the Lions Gate Bridge as we speak (ie that house they bought for $25.9 Million is probably worth a lot less now and will continue to decline). That price range sounds like it must be in Point Grey waterfront, new home, on about an acre lot.( unless it’s one of those pretentious hi end penthouse condos , but you did note your list was for SFH ).
November 24th, 2008 at 10:01 am
Patiently Waiting – that’s exactly what I’m doing. A year ago everyone looked at us like we were nuts for renting a house (but were too polite to say so). Just in the last few months we’ve had three people tell us what a good idea it is. Of course, they attribute it to luck and not foresight, but whatever.
November 24th, 2008 at 10:08 am
“When we got home I checked the mail and the Wynn wants us to come back to Vegas for $169/night (half price). I’m seeing a theme here, everything is dropping to HALF PRICE!”
What, only half? You’re getting ripped off
I’m taking a 1-week Caribbean cruise out of Miami on the 6th, the brochure price is $1699 + 75% single supplement, I’m paying $135.00 and no single supplement. Yes, the port charges are almost double what the actual cruise line is getting, less than $20 a day, you read that right.
And I’ve got a March reservation for a week in Cuba, all inclusive (even drinks!) and including Vancouver return air fare, CDN $502 including all taxes that’s the final price, which is something like a quarter of what the same vacation was a year ago.
So, yeah, for travel freaks like me it’s the best time EVAR as the vacation industry plummets into collective bankruptcy, “50% off” isn’t even close.
I’m kinda thinking that after those two little jaunts I’m going into serious cash conservation mode though. Might need it all pretty badly before this works itself out…
November 24th, 2008 at 10:11 am
Yes, unfortunately we have had an influx of eastern liberal types (due to economic immigration) in the last 3 years. Sorry to say…..
Guess that explains why the Liberals took all the Calgary seats in the 2008 provincial election… oh sorry they only got 4 out of what, 20 or so?
Then I guess only eastern liberal types vote in Calgary civic elections. Well that’s the fault of the 81% who don’t vote, isn’t it?
As for the “socialist” Calgary city council – would you believe that in Calgary you have to pay $12 a year to use the public library? Yes, it’s true. Roll over, Andrew Carnegie, you old commie.
November 24th, 2008 at 12:00 pm
Carioca Canuck:
Re Calgary City Hall
No, you were right ….it IS communism.
What is often a major warning sign is when they raise taxes and also the perks levels to City Staff. This is the makings of a mini – fascist state. It’s usually either the CAO or the Mayor (or possibly both )
They pay the staff well, keep the senior administration rolling in dollars and added perks…with severance packages in $100′s of thousands of dollars. This gets them support and heads off internal coups…they often have a few heads rolling from time to time to send a message to the others.
The bunker mentality reins, having built the aforementioned walls at City Hall to protect them from the general public (ie their actual bosses) or frustrate them from mounting any opposition.