How much will the Olympic Village cost you?

richard1 just posted a link to this column in yesterdays Vancouver Sun: Olympic Village finances getting scary for taxpayers:

Thinking it couldn’t lose in the real-estate big leagues, a few years ago the City of Vancouver guaranteed the world it could build the Olympic Village for 2010 — and even make a profit. Now the global financial crisis has turned a supposedly sure thing into a high-stakes gamble.

The dilemma is the local condo market has turned. The Olympic condo units, which were supposed to be occupied by athletes during the Games and then turned over to new owners, are probably worth 10-to-20-per-cent less than initially expected.

Even worse, the prospect of fast sales — most were expected to sell by 2010 — has evaporated. If they don’t want to sell at fire-sale prices, city officials now realize sales will probably need to be delayed until the market rebounds, whenever that might be.

Are those that guaranteed these loans with taxpayer dollars really suprised by the turn in the real estate market?  Sure the economy is going through a rough patch, but it doesn’t take a global economic downturn for the ‘Olympic Curse‘ to end up costing a host city plenty.  Beijing’s slide can be blamed on recession, but Sydney and Athens happened at a time of global economic expansion and still got hit by the post games slump.

Are you ready to pay off your share of the party bill?

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Franco
Franco
11 years ago

Never,believe what Chinese said media which is extremely bias and interpret international event with naive sino-insanity.

Franco
Franco
11 years ago

Never,believe what Chinese media which is extremely bias and interpret international event with naive sino-insanity.

Supraboy
Supraboy
11 years ago

"#94 Supra boy ( an intelligent comment for a change) Did you buy a brain on Second Life or did you put down the crack pipe today? Just kidding since you actually sound reasonable today, congrats."

I think I got a second life since I'm making money from stocks. 🙂

Lily pad
Lily pad
11 years ago

Thanks M-

For a minute there I thought might have missed a "New Math" concept! Glad to know I'm not that out of it 🙂

M-
11 years ago

Realpaul: you mean "median".

2 2 5 6 7 8 9 9 9 9 9

Given this set of numbers:

Average = Mean = (75/11) = 6.8

Median = middle value = 8

realpaul
realpaul
11 years ago

#118 lilypad, a mean average is an arbitrary number which separates the sample ( in this case real estate sales figures) into two

:EX

If there are ten sales from 100K to 1 million then sale number five ( 500K) represents the 'mean' average , It's often used by the realturd industry to confuse the math challenged. It's simply the number in the middle, it means absolutly nothing.

jesse
11 years ago

"Immigrants from China will continue to arrive in Greater Vancouver 40000 – 50000 strong every year as in the past."

That's good for them because they'll have lots of choices where to live, whether they rent or buy. Guess which one they choose to do when prices are dropping 2% per month.

Vansanity
Vansanity
11 years ago

Once the olympics are over, what flavor koolaid will they drink?

Stick a fork in this market. The numbers speak for themselves and are much more meaningful than rhetoric and opinion from either bull or bear viewpoints.

Lily pad
Lily pad
11 years ago

realpaul: "(note this the mathematical average not a mean average)"

What is the difference between the two, if you don't mind my asking?

Thompson
Thompson
11 years ago

Supraboy Says: "Is it fact or is it propaganda? My dad just read the chinese newspaper here and he said Vancouver real estate will turn upwards in mid 2009.

So who should we believe now?

That Chinese newspaper, I think, is a bunch of bull. They’re trying to keep the Chinese in Vancouver upbeat thinking they’ll be richer."

Immigrants from China will continue to arrive in Greater Vancouver 40000 – 50000 strong every year as in the past. Yuan to C$ is 5.6:1 compare to 6.8:1 in the past, so more buying power.

realpaul
realpaul
11 years ago

112 The assesed values (for purpose of tax assesments) have nothing to do with individual values. Tax assesments are designed to reflect a cachement area general values. The appraisal process does attempt to adjust however imperfectly for anomalies in the specific sub areas. The court requires that tax evaluations fall within a range of plus or minus five percent. The City and Municipality develop a 'mill-rate' from the generalized numbers and divide the budget ( financial wish list) into the average values overall. This can be detrimental to an individual property owner which is why the court allows for a generous appeals process. Appeal adjust anomalistic assesment allmost 100% of the time. You just have to apply. Heres an example of how people can be fooled by published statistics/average values. 10 homes in a cachement ( sub sector) sell for… Read more »

blueskies
blueskies
11 years ago

Also, it makes life so much more difficult for us in the know who have to deal with our friends and colleagues going through this roller coaster ride.

What to do?

you have to appear sympathetic while

changing the subject subtly ……

you may have to practice in a mirror

"Hey how 'bout them Canucks eh?"

realpaul
realpaul
11 years ago

#108 hilarious THX

Lily pad
Lily pad
11 years ago

Ok, I see that the sales transactions reported are from January, 2007 and October 31, 2008 as it says right on the BC Assessment website:

"For this year only, the 2009 Property Assessment Value reflects market value as of July 1, 2007 or July 1, 2008, whichever is lower. Sales information is from properties that sold between 01 January 2007 and 31st October 2008. Each year you may review additional details for up to eight properties per PIN. Click here to see a list of details available. To proceed, you require the Assessment Roll Number and the PIN from your assessment notice. Check the box beside properties you want to review and click More Info. Property details are available until midnight (PST) on the 2nd February 2009"

Lily pad
Lily pad
11 years ago
Lily pad
Lily pad
11 years ago

If you go to this site http://www.bcassessment.bc.ca/eValueBC/(S(kcxrbe5… you can see the 2008 property sales transactions for 2008. (I'm not sure which month is the cut off). You can see the assessed value for 2007 (which I believe was based on March figures) compared to the assessed value for July 2008. If you didn't know that house prices decreased approx. 16% from May 2008 and you looked up the "value" of your house you might just think it increased in value since last year. This is really depressing and will cause all sorts of emotional confusion on the part of the seller. How can a person reconcile the "Wow, my house is worth 6% more this year — I'm rich" with "Nobody wants to buy my house, not even for 20% below the 2007 assessment price". Also, it makes life so… Read more »

jesse
11 years ago

"Raw listing numbers are pretty arbitrary, but months of inventory is one of the best leading indicators you can look at because it captures changes in both supply and demand. There’s a pretty consistent 1-3 month lag between MOI and price changes."

Agree however I should add that high inventory and low sales are closely related. Much of the market is effectively house trading; that is, many a house that doesn't sell means another cannot be bought.

We are seeing the entire real estate food chain gummed up. Interestingly a small change in the number of willing and able buyers will cause things to wildly swing — every first-time-buyer and investor-buyer has 2-3 sellers who depend upon them. Leverage isn't just in finance, it's inherent in the way the housing inventory system works as well!

NO -LYMPICS
NO -LYMPICS
11 years ago

Realpaul:

Here is some sound financial advice

What's old is new again.

(From E. Idle, Esquire)

http://www.youtube.com/watch?v=sor9GzivGbk&fe

jesse
11 years ago

"Forgot to mention, bulls and bears are both deluded."

You don't think it's possible to objectively look at a market and figure out the most likely outcome based upon data and logic? You do yourself and many other posters here a disservice. You have some interesting comments and, up until now, your motives have been pretty much irrelevant.

realpaul
realpaul
11 years ago

Alcoa slashes 13,5oo jobs, predicts 'lengthy recession'

Bad news for bulls

Alcoa slashes jobs, output to conserve cash

Aluminum giant to take four-quarter charge of at least $900 million

By Matt Andrejczak, MarketWatch

Last update: 4:36 p.m. EST Jan. 6, 2009Comments: 63SAN FRANCISCO (MarketWatch) – Alcoa Inc. said Tuesday it is cutting 13% of its workforce, closing plants, and further curbing aluminum output to conserve cash as it battens down for a lengthy recession

realpaul
realpaul
11 years ago

"lies, damned lies, statisitics". Is Royal Le Page including housing in Nunuvut, North West Territories and off -reserve farmland in Northern Saskatchewan in it's "National Statistics" of course they are. These puff pieces are designed to confuse the uneducated.

http://www.globeinvestor.com/servlet/story/RTGAM….

realpaul
realpaul
11 years ago

How about a Monty Python moment

http://www.thesmokinggun.com/archive/years/2009/0

Lily pad
Lily pad
11 years ago

realpaul: "#97 Lilypad the ‘walk away ‘ guy was not the ‘walk away’ guy from Calif. It’s a CDN insurance underwriting scheme doing buisness with Hyundai to sell cars on a “if you lose your job within 12 months of buying a Hyundai we’ll take the car back under certain conditions” scheme."

Ya, I realized that and corrected myself. My bad 🙁

The first part of my posting was accurate, though, and the interview with head of the Canadian Homebuilder's Assoc. is worth watching. That's the clip where they said unsold inventory of new homes increased 56% ACROSS CANADA.

NO -LYMPICS
NO -LYMPICS
11 years ago

Toyota just announced an 11 day shut down , too much unsold product http://www.guardian.co.uk/business/2009/jan/06/to… QUOTE: Toyota, Japan's biggest carmaker and the world's second-biggest behind General Motors, said today it would close all of its domestic plants for 11 days in an unprecedented attempt to stave off redundancies and shift its stock of unsold cars amid a catastrophic decline in sales. The decision, coming soon after the Japanese carmaker announced plans to close 11 of its 12 factories in Japan for three days later this month, is expected to increase the pressure on other makers to follow suit. Toyota is heading for its first operating loss in more than 70 years, largely due to plummeting demand in the US. The firm is bracing itself for an operating loss through to the end of March of ¥150bn (£1.1bn), compared with a ¥2.27… Read more »

blueskies
blueskies
11 years ago

this is what 2% per month decline over 24 months does to a house worth $600K….. ain't purty at all… hopefully the formatting works factor/% price month discount new price 2 $600,000.00 1 $12,000 $588,000 0.02 $588,000.00 2 $11,760 $576,240 0.02 $576,240.00 3 $11,525 $564,715 0.02 $564,715.20 4 $11,294 $553,421 0.02 $553,420.90 5 $11,068 $542,352 0.02 $542,352.48 6 $10,847 $531,505 0.02 $531,505.43 7 $10,630 $520,875 0.02 $520,875.32 8 $10,418 $510,458 0.02 $510,457.81 9 $10,209 $500,249 0.02 $500,248.66 10 $10,005 $490,244 0.02 $490,243.68 11 $9,805 $480,439 0.02 $480,438.81 12 $9,609 $470,830 0.02 $470,830.03 13 $9,417 $461,413 0.02 $461,413.43 14 $9,228 $452,185 0.02 $452,185.16 15 $9,044 $443,141 0.02 $443,141.46 16 $8,863 $434,279 0.02 $434,278.63 17 $8,686 $425,593 0.02 $425,593.06 18 $8,512 $417,081 0.02 $417,081.20 19 $8,342 $408,740 0.02 $408,739.57 20 $8,175 $400,565 0.02 $400,564.78 21 $8,011 $392,553 0.02 $392,553.49 22 $7,851 $384,702… Read more »