The Vancouver bubble blog bubble is rapidly deflating. The latest casualty of this humour downturn is the witty and beloved condohype, who posted notice of closure this morning.
I hold out hope for a change of heart, afterall it wasn’t so long ago I posted about this blog closing for similar reasons.
Le hype est mort, vive le hype!
I’ve heard a few interesting ‘public service messages’ on news / talk radio station CKNW 980 lately. I’ve transcribed them below, see if you can detect the subtle pro-real-estate investment message they’ve subliminally inserted:
Thursday March 26 – 9am – audio vault time 5:44
It’s time to get off the fence. If you’ve been waiting for the right time to buy your first home, that right time is right now. Home prices in Metro Vancouver have dropped dramatically. Home mortgage rates are at an all-time low. First time home buyers are eligible for up to $750 dollars in tax credits. The real estate window of oppourtunity is wide open. So make your move today because your white picket fence can’t wait forever. A message from Corus radio.
Friday, March 27 – 9am – audio vault time 28:15
(cue majestic horn music)
“Real estate can not be lost or stolen. Nor can it be carried away. Purchased with common sense and managed with reasonable care it is about the safest investment in the world. ”
Franklin D Roosevelt, former US presidentMetro Vancouver Homes today are more affordable than any other time in the last three years. Mortgage rates are at an all-time low. Could this be your time to invest in real estate? A message from Corus radio.
It’s nice to know that CKNW cares about my financial well-being, but when did they start offering investment advice through public service announcements? And if prices being lower than any point in the last three years makes local real estate a good buy, does that make General Motors stock a super-duper-extra good buy, since it’s currently priced lower than it was 30 years ago?
update: Reader Bilbo Bloggins points out that CKNW cut out part of the full Roosevelt quote, which is as follows (omission in bold): ..”Purchased with common sense, paid for in full and managed with reasonable care…”
It’s the end of the week again, but this week is a little different with a focus on some of the more bullish developments this past week. Here are a few stories:
- B.C. businesses slightly more optimistic: CFIB survey
- Olympic ticket sales put 2010 Games in ‘positive cash position’
- U.S. home sales climb at fastest pace in last 10 months
- U.S. bank bailout plan ignites stocks surge on Wall Street
- Entertainment software delivers $1.7b boost to Canadian economy
- Richmond-based Kin’s Farm Market to expand
- Immigration boosts population growth: StatsCan
So what are you seeing out there? Post your thoughts, anecdotes and economic news here and have an excellent weekend!
-Dave
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 into your comment will automatically create a clickable hot-link. Linking to more than one external link within a single comment may cause your submission to get held up in the spam filter.
Newspapers love stories of human drama – something that will grab your attention and get you to buy the paper is ideal, particular if it’s something personal that connects with the readers experience or fear. I remember seeing a headline story on the Province newspaper about ‘underwater’ mortgages in the mid-nineties, but I haven’t seen any front page stories on the Sun or Province yet about the human impact of the Vancouver real estate market crash. Perhaps its too early, or perhaps I haven’t been paying attention.
So let’s have a poll – when do you think we’ll see a front page story on a local paper linking the Vancouver real estate market crash to hard times on the individual level? I imagine this would be a story about families that owe more than their home is worth or have gone bankrupt on presale contracts that they can’t get financing for.
[poll id="33"]
Looks like Ottawa sees some mortgage problems coming down the pipe even in these times of record low interest rates:
As the recession deepens, Canada’s big banks and its federal mortgage insurer are moving to head off a rise in defaults by homeowners.
Ottawa is launching a campaign to urge the cash-strapped to approach their banks for mortgage relief, as the banks adopt more flexible practices aimed at preventing borrowers from falling behind on payments. The measures by the banks and the Canada Mortgage and Housing Corp., the federal agency that guarantees mortgages, signal growing concern about increasing levels of household debt.
With house prices dropping, job losses rising and the economy not yet showing signs of recovery, both the government and lenders are pushing consumers to be proactive if they think they might have problems paying their debts.
Unfortunately we don’t seem to have many publicly available stats for mortgage debt in Canada, but I wonder how many ‘cash-strapped’ owners went in for the Government approved (but recently canceled) zero down 40 year CMHC mortgages to keep from being ‘priced out forever’?
The full article is at the Globe and Mail. Hat-tip to Observer for the link!
With the world of economic news awash in negativity, how is everyone feeling out there? Does the Vancouver real estate crash have you feeling down? Are you concerned about your bank account or retirement options?
Depending on your current situation you may feel either depressed or optimistic about the direction our local economy is going. On one hand the current real estate correction is a strain on those who are over-leveraged and need to sell, on the other hand dropping home prices are a positive development for those that have been ‘priced out’ of the market.
I assume that everyone reading this site is interested in purchasing real estate, but only when it makes sense to them personally. What factors will you use to figure out if you’re financially and emotionally ready to enter the market, and are you ever concerned that your optimism or pessimism are habitual rather than rational? Is it time to buy, or is it time to sell and cut losses?
It’s the end of the week, so lets do our regular news round up and open topic discussion. Here are a few stories I’ve noticed lately:
-Vancouver office vacancy rate jumps to 7.3%
-BC Forest profits plummet
-Food and housing costs drive inflation up
-Carnival leaves town, tourism sector to lose $18 Million
-MLS admits Vancouver despite economic slowdown
-PM defends economic confidence against David Dodge
-Detroit, Artists and the $100 house
-Hong Kong stock commentator bursts into tears
-Images from the global recession
-What’s hot at the pawn shop
So what are you seeing out there? Nervous about your job security? Are you saving more or taking on more debt? Post your thoughts, anecdotes and economic news 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 into your comment will automatically create a clickable hot-link. Linking to more than one external link within a single comment may cause your submission to get held up in the spam filter.
This is an extension of the previous thread with some local coverage from the Vancouver Sun:
The Pirillos are among hundreds of B.C. property owners who have been caught by slumping real-estate prices and high-interest, subprime mortgages.
They bought their five-bedroom house five years ago for $114,000, but Pirillo owes Accredited Home Lenders, a U.S.-based subprime lender, $140,000 after borrowing against their house equity.
Their mortgage called for interest payments of 8.25 per cent, but when it came to renew recently, the company wouldn’t renew at any price because the bottom had fallen out of the housing market.
“My mortgage lenders evaporated. We couldn’t find anybody to lend us money,” said Pirillo.
In default, he put the house on the market but was unable to unload it for $215,000. It is currently listed at $169,000.
An extra thought for discussion: It’s taken three years for the housing market in the US to fall apart to its current level, but their collapse started before there was any really bad economic news, prices simply started to fall after getting too high. Every spring the US markets seem to have a small rally, then fall dramatically over the rest of the year (sacramento for example). With the current global economic climate will our market fall faster and hit bottom at a relatively quicker rate, or will the US market be recovering for years before our local market does?
From this weekends Globe and Mail business section:
“I didn’t really have to show anything to borrow,” Mr. Goodyear said of his two remaining mortgages, both in default and totalling about $340,000. “I didn’t have to show them my tax returns. I just said ‘This is how much I make.’ I think I made 11,000 bucks.”
Mr. Goodyear is not alone. A Globe and Mail investigation into more than 10,000 foreclosure proceedings has uncovered a burgeoning subprime mortgage problem that many, including Prime Minister Stephen Harper, have insisted does not exist in Canada.
Read the full article here, as well as thier article on the related surge in foreclosure proceedings in BC and Alberta.
It’s the end of the week! Lets do our news round-up and open topic discussion thread for the weekend. Here are a few stories I’ve noticed lately:
-RBC: BC economy to decline 1.5% in 2009
-Toxic wallboard blamed for health problems in US and Canada
-Vancouver housing starts drop 70%
-Vancouver 2009: First time buyers are driving the market
-Sacramento 2006: First time buyers are driving the market
-A graph of Sacramento house prices for the last three years
-Two BC companies admit to ponzi schemes
-Canadian consumers back in the doldrums
-Stock markets: cheap or still overpriced?
-Canadian unemployment to peak in 2010?
-Enough negativity: Share your good news stories.
So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend filled with sunshine, magic ponies and free beer!
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 into your comment will automatically create a clickable hot-link. Linking to more than one external link within a single comment may cause your submission to get held up in the spam filter.
