Have we hit bottom yet?
I don’t know if the real estate market in Vancouver has ever only declined for one year, particularly at the beginning of a global recession, and I know what most of you think about that question anyways, so I won’t ask if you think we’ve hit the bottom of the real estate correction..
I am however seeing encouraging signs that we’ve hit bottom of the bursting real estate bubble blog bubble though, despite the disappointing news yesterday of Condohypes closure. We originally called this bubble at the beginning of 2007, and at the start of this year we reported on the apparent bursting of the bubble blog bubble. Now however, we get news that Fish is back. That link has been updated on the links to the right, along with a belated correction of the link to Housing Analysis.
Is this just a spring bounce or the return of the Vancouver bubble blog bubble? Either way we’re always like to see new independent sources of information and opinion on the Vancouver real estate market, even if they’re old sources.
So when you change your mind Condohype, we’ll be happy to welcome you back.
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April 1st, 2009 at 8:44 pm
I was sitting in a restaurant yesterday, listening in on a conversation between a couple. The woman said “they say that the recession will get even worse after the Olympics, because all the construction jobs will be gone.” So, people who listen to “they” instead of forming their own opinions (i.e. most people) are getting worried, which could signal that we’re on the edge of a precipice.
April 1st, 2009 at 8:44 pm
I see no evidence of a bottom. Things are just starting. As we saw with the run up, once thingg get going it takes a lot to slow down the market due to the intertia of all the players out there. On the way down it will take a hell of a lot to stop the decline. We are just getting started. This bubble was at least 6 years in the making I figure it will take six years before we see a significant upswing again.
April 1st, 2009 at 8:46 pm
http://online.wsj.com/article/.....75441.html
Home Prices: Low, But Still No Bargain
Interesting article. Incredibly it is suggesting even with the large housing price drops in the US so far, prices may still be too high there. Learn something every day.
Condohype’s witty commentary will be sorely missed. Nothing like caustic irony and contemporary allusions to wake up the sheople.
April 1st, 2009 at 9:04 pm
Has anyone considered that the recent ‘crime wave’ in vancouver is the perfect cover and distraction for the PLOTICIANS in Victoria and to a lesser extent all the local PLOTICIANS who would otherwise have to be answering for the horrifc state of the economy?
It has been a media Godsend to Gordon Campbell, without the Bacon Bros and all the other cockroaches who have fortuitously crawled out of the valley sewers what do you think the ‘sheeple’ would be talking about. If I was a Liberal Party MP up for re-election I would be down on my knees offering up a fatted calf or whatever your persuasion dictates.
Now what if this media blitz was just mis direction , obfuscation and a big plan to blow smoke up your ass so that you weren’t thinking about the 6 billion thats been blown on the Olympics or the huge growth in unemployment or the final collapse of the forest industry and cruise ship tourist trade just in the past two weeks back to back?
Where is the concern for the tens of thousands who have lost thier jobs in the past 60 days in BC’s construction industry, wheres the invvestigative reporting? It’s been just too easy to drive out to Abbotsford, Surrey or Chilliwack and sit inside the Tim Hortons to wait for a drive by shooting or high school execution.
Is the ‘ negative denial’ campaign suggested by Bob Rennie more widespread and sinister than anyone could have imagined.
Theres just too much ” Kum By Ya’ glee-speak and positive propaganda by the MSM to be accidental this close to an election. Many years ago ( as a dumb cynical kid) I wrote copy for a political party and I can tell you, there are no accidents, only incidents.
April 1st, 2009 at 9:09 pm
other ted: *woosh*
April 1st, 2009 at 9:17 pm
Bottom? I think not!
Remember what happened in the states before the bottom fell out?
Buyers flocked to buy ‘discounted’ homes and condos because they all thought it would shoot back up after the ‘correction’ before it took the big drop.
Just like a bear market … this is a bear trap.
also i am sure we’ll be seeing this around Van soon
http://marketplace.publicradio.....w_staging/
April 1st, 2009 at 9:29 pm
other ted:
I figure it will take six years before we see a significant upswing again.
It took six years to see a significant upswing from the 1981-82 bust, and all fundamentals are vastly worse this time.
I think we are looking at a Japan scenario.
April 1st, 2009 at 10:18 pm
Six years is too soon. It will likely be 15 years before the homes will be back to May 2008 nominal value. It will take at least 8 years to bottom out. First 3 years will be big drops, next five will be slight drops. After 8 years, it will take another 7 to get back to the nominal amount equal to that of May 2008.
Please note. We will likely NEVER get back to May 2008 values in Real Terms. I don’t even think we will get back to Real terms at todays value.
April 1st, 2009 at 10:37 pm
Since even Supraboy is converted already – no more rich asians spending in richmond’s restaurants, the downhill ride may only get deeper and faster
April 2nd, 2009 at 12:19 am
Well I was sitting in a vietnamese rest and the family was discussing real estate what a suprise?
Dad wanted the On to buy a SFH
but the son said “just wait a minute. GM is not going to make it. If they go under there will be a lot of problems”
Dad ” Just take a look …it;s a good Buy”
Eventually I think he agreed to take a look but at least there is some serious doubt other than blind acceptance of ” Real estate only goes up”
April 2nd, 2009 at 1:32 am
Check this out:
http://www.bloomberg.com/apps/.....refer=home
April 2nd, 2009 at 2:00 am
Anon:
The average cost of a home jumped 0.9 percent in March from the previous month to 150,946 pounds ($218,000), the mortgage lender said in a statement today.
The average is notoriously prone to swings due to change in market mix. An increase in the average of 0.9% means nothing.
Note also how cheap the UK looks compared to BC, never mind Vancouver. Keep in mind that incomes and rents, in dollar terms, are higher there than here. Could someone run that “running out of land” argument by me again?
April 2nd, 2009 at 5:01 am
Patriotz I have to agree with you on a Japan scenario playing out here. Six years was my most optimistic guess. I am leaning to a much worse scenario.
April 2nd, 2009 at 9:22 am
observer: Looking at affordability in the US, the Housing Affordability Index (HAI) has hit a new record high of 173.5 for the month of February, 2009. (This indicator has been calculated since 1970.)
The HAI compares national median family incomes to median home prices. A value of 100 signifies that a family earning the median income has enough income to qualify for a mortgage on a median-priced home. (The monthly mortgage payment is conservatively figured to not exceed 25 percent of the median monthly family income).
The HAI value of 173.5 means that a family earning the median family income has 173.5% of the income necessary to qualify for a conventional loan covering 80 percent of a median-priced existing single-family home. (This compares to 106.1 in 2006.)
April 2nd, 2009 at 9:44 am
Let me ask you a question
How many of you can afford an average house in vancouver priced at nealy 500,000.
if the answers are not me than I guess the bottom is not here yet
April 2nd, 2009 at 9:45 am
crabman:
This seems at odds with common sense and all the data I’ve seen. If the affordability is now at an all-time high since 1970, why are prices still falling?
Take a look at the following chart of US median house price/income:
http://www.ritholtz.com/blog/2.....ly-income/
What’s the current median house price/income in Vancouver right now folks?
April 2nd, 2009 at 9:47 am
Avergae icome here in the UK is about 35K, which isa baout 70,000 dollars, and average price for home is about 150,000 which is about 300,000 dollars
and they call London expensive , I am hoorified at prices and wages in vancouver
April 2nd, 2009 at 9:56 am
Bottom? What an idiotic question. Let me remind you that median income in Vancouver is about 60,000, which means that a sustainable price for an average house is $180,000. Until the prices go WELL BELOW that level, no recovery is possible.
April 2nd, 2009 at 10:07 am
Vancouver does not have the income levels to demand the present re prices. Average wage here is comparable to Manchester in the UK, rather than London. Interestingly though, rent is actually higher in city centre manchester than Vancouver, although re is cheaper.
Average wage in London is around 60,000 pounds per year and in London City (financial district) closer to 80,000 pounds. I think the average wage is closer to 50,000 dollars a year here.
Fundamentals are out of wack. We have a long way to the bottom
April 2nd, 2009 at 10:17 am
Further, i guess i’m doing good by Vancouver standards earning around 135,000 per year. However, having no down payment thanks to getting raped in a divorce, to buy an average place at 500,000 would take more than half of my income (i figure around $3300 per month with taxes and condo fees) renting would be around 1800 – 2000 for a comparable place.
Think i will rent till there is some sanity in the market.
April 2nd, 2009 at 10:36 am
Article in the G&M about the mishmash of foreclosure laws in Canada, and how it’s hard for lenders to pursue delinquant borrowers in BC:
http://business.theglobeandmai.....wPage/home
April 2nd, 2009 at 10:37 am
Hey guys, why are the markets rallying? And why are restaurants always jammed packed? There is obviously no recession here in Vancouver. As some of you may recall, I was always telling you all how packed the Chinese restaurants are during lunch and dinner.
Last Friday, I went to Steamworks at Gastown for lunch and had to wait 30 minutes for a table. Guess what, everything on the menu was more than $10. Steamworks isn’t a chinese dim sum place, we’re talking about a higher middle-end sort of a restaurant here.
My question is, is anyone noticing how packed restaurants are? Where are these people getting the money to spend on fine dining? I’m making decent money here and it’s difficult for me to head out eating all the time. I don’t understand how others can afford splurging at a time like this. I can tell you that I’m making more than $70k a year with a paid off house in Mackenzie Heights. My house is valued at over a million yet even I can’t afford to go out everynight. Don’t these people have bills to pay?
April 2nd, 2009 at 10:39 am
Niko Says:
April 2nd, 2009 at 9:56 am
“Bottom? What an idiotic question. Let me remind you that median income in Vancouver is about 60,000, which means that a sustainable price for an average house is $180,000. Until the prices go WELL BELOW that level, no recovery is possible.”
Wow, that’s aggressive, I really don’t see that happening anytime soon. I’m expecting average home price to drop to about $375,000 at best, that would be great (I’m talking Vancouver proper here).
$180,000 would be nice, but I just don’t see it happening.
April 2nd, 2009 at 10:45 am
$180,000 would be nice, but I just don’t see it happening.
these exact words were spoken in California
about 3 years ago…. now even in (Marina is Prime) SanFran prices are dropping
with no bottom in sight yet…….
April 2nd, 2009 at 11:01 am
VanBanker:
I’m expecting average home price to drop to about $375,000 at best, that would be great (I’m talking Vancouver proper here)
Could well happen. That’s 1970′s or mid-80′s real prices, and I just don’t think they are going to get better than that. But that’s plenty good enough for me.
You could buy a SFH in WPG in the mid-80′s for 150K, and CPI has a bit more than doubled since then.
April 2nd, 2009 at 11:01 am
Supraboy:
If you think Steamworks and dim sum is fine dining, I’ve got a “luxury” condo to sell you.
April 2nd, 2009 at 11:07 am
Stantec laid off 50 engineers last week. Heard through the grapevine.
Nothing to see here.
April 2nd, 2009 at 11:21 am
I was in Richmond this morning, havn’t been there for a while. Does anyone know what happended to the Rona on Sea Island Way? Only been there a couple of years now its vacant and building available for lease. Didn’t hear about this anywhere. I guess 1,000 square feet of space vacated by Starbucks is bigger news than this!
April 2nd, 2009 at 11:25 am
Any move that is humanly,phisycally,timely,and safely possible to do in 10 minutes we do that in 1.5 minutes at my work place just because of timing settle up by engineers.I wish all engineers lose their jobs this month then I will buy four more condo in downtown.
April 2nd, 2009 at 11:37 am
How good is thise deal?http://vancouver.en.craigslist.ca/reb/1103875201.html
April 2nd, 2009 at 11:44 am
So now we are starting to get the truth about what a money pit the Olympics really are. No more hiding behind a wall of ‘ siss boom bah’. If they are starting to tell you about losses now just wait until the real numbers come out. The IOC is just softening you up.
The organizers of the 2010 Winter Olympics no longer expect to leave a financial surplus for future sport development.
The same worldwide economic downturn that has bankrupted companies and left tens of thousands of people without jobs has also eaten up — for now — any potential Olympic profit, John Furlong, the head of the Vancouver Organizing Committee, said Wednesday.
Furlong said Vanoc is struggling just to make sure it breaks even when the Games end next year.
Vanoc expects no profit in 2010 Games with economic slump
http://www.vancouversun.com/bu.....story.html
With the big economic news of mass job loss and photo’s of food lines at the ‘bank’ and long lines of unemployed finally hitting the MSM ( how long could they keep hiding this realistically and why)the euphoria and cheerleading will squeeze a lot more hot air out of the Vancouver bubble.
April 2nd, 2009 at 11:46 am
RennieWhereRU?:
#28, the RONA Richmond went bust due to lack of intrest, the place never got off the ground it seems.
April 2nd, 2009 at 11:48 am
201-1082 SEYMOUR ST for 296.000. Was on sale in Feb,then was taking off market in 1 March.Now they put buck on the market for the same price.What is going on
April 2nd, 2009 at 12:03 pm
the $375,000 average for vancouver area you guys think it will go to is that for houses or condos and houses.
I was going over some numbers thinking about rent equivalents. In Calgary for one of those hospital lotto’s they have a complete duplex as a prize values at$760,000. They claim both sides rent for just over $30000 a year. I figure based on rent equivalence its worth $470. Then I thought about my sisters house in coquitlam. She rents it out for $2200. She believes its worth just under $600. In todays market it might be. She over paid in the late 90′s and bought at $280.(over paid based on that market). anyways I figure the house based on rent equivalence is worth no more than $390 now. And I think it will correct to this fast. I also believe rents will drop. Does anyone see housing correcting this fast in the next year. I personally do. I believe when this is over I will see my sisters house again at nominal prices just over $300.
April 2nd, 2009 at 12:25 pm
Bob:
really bad…. go see it
lowest possible floor probably no view
maybe above the parkade gate
caveat emptor (save your money)
April 2nd, 2009 at 12:31 pm
normally lurking: Agreed. Supraboy has no idea what fine dining is. In fact, he really has no idea about anything.
Steamworks is an after-work drinking hole.
April 2nd, 2009 at 12:42 pm
Have the market hit bottom yet?
NO.
Can I afford a house in Vancouver?
LOL.
April 2nd, 2009 at 12:51 pm
james:
That’s not a reasonable expectation for the majority of people. There are a lot more people than there are single family homes in Vancouver.
April 2nd, 2009 at 12:53 pm
other ted:
#34 OT, rents are already dropping as has been well covered in this forum. The ‘Houses vs Condos’argument is a no brainer. Condos ONLY have a rent equivalent value with a fairly restricted economic life. The price should go down much farther in the condo market as opposed to the SFH.
a) there is no land restrictions on condo development
b) a depreciating condo runs down to a fully depreciated asset to zero due the share in land is negligable whereas a sfh will have a replacement component and a permanent value in land. An old condo becomes functionaly obselete and stays that way and will never command equivalent to new rents.
c) an ageing condo will increasingly require additional expensive maintenance outside the control of the owner. Management services are also going to increase above the rate that property taxes do.
So as the rent goes down and the holding costs go up the value should go down, much like a mobile home.
d) unless wages go up ( which they don’t in Canada) prices are going to come down, unless the 0/50 mortgage comes back.
April 2nd, 2009 at 12:59 pm
More with the “seasonally adjusted” BS. The truth is that there are probably a million or more monthly layoffs in March as has ben reported by private statisticians. The government thinks you’re going to jump out the window or take to the streets if they tell the truth.
New jobless claims jump in U.S.
CHRISTOPHER S. RUGABER
Thursday, April 02, 2009
WASHINGTON — The number of people filing new jobless claims jumped unexpectedly last week, while those continuing to receive benefits hit a 10th straight record-high. Both figures show the labour market remains weak and is unlikely to recover any time soon.
The Labor Department said Thursday that initial claims for unemployment insurance rose to a seasonally adjusted 669,000 from the previous week’s revised figure of 657,000. That total was above analysts’ expectations and the highest in more than 26 years, though the work force has grown by about half since then.
The tally of laid-off workers claiming benefits for more than a week rose 161,000 to 5.73 million, setting a record for the 10th straight week. That also was above analysts’ expectations and indicates that unemployed workers are having difficulty finding new jobs.
As a proportion of the work force, the number of people on the jobless benefit rolls is the highest since May, 1983.
April 2nd, 2009 at 1:07 pm
The BC LIBs are trolling deep into NDP territory now. The bad news is piling up in every corner, crime policy is a failure, economic policy is a failure, layoffs are up, industries are crashing, Olympics admit big losses coming, Translink screws the pooch for an additional prop tax etc etc.
So NOW the latest trial balloon is Legalizing Pot Bwahahahahahahh. They are really bereft of new ideas. Laughable. Wait for it and just imagine all the never to be completed announcements to come. We’ll have universal daycare, free dentures for the toothless, a chicken in every pot. I’m nauseous already from the smell of this bullshit.
B.C. MP to ask the government to decriminalize marijuana
Katie De Rosa, Canwest News Service
Published: Thursday, April 02, 2009
More On This Story
Colby Cosh on legalizing marijuana: Barbara Kay vs. Mary Jane
Heavy use of marijuana may lead to psychosis
Quebec home doubled as daycare, marijuana grow-op, police allege
Public use of medical marijuana faces review
Ontario wants federal government clarity on medical marijuana use
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Keith Martin
Philippe Lucas
Illegal Drugs
Marijuana
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VICTORIA — A Victoria-area member of Parliament will ask the federal government to decriminalize marijuana in a private member’s bill Thursday.
Keith Martin, Liberal MP for Esquimalt-Juan de Fuca, wants the government to recommend fines instead of criminal charges for anyone caught by police with fewer than 30 grams of marijuana or two marijuana plants.
April 2nd, 2009 at 1:32 pm
Anonymous:
What do you have against engineers? Did somebody hang your car off a bridge?
April 2nd, 2009 at 2:19 pm
FASB mark to market rules changed b/c of political interference … now the banks get to “make up” the values … IF ANYONE thinks this is a good idea they have their head so far up there arse ….
April 2nd, 2009 at 2:58 pm
I have to give kudo’s to Dean Beauvais who wrote a letter to the editor of the Richmond Review stating,
” We should be ashamed of ourselves for being so easily led by the government. Manipulating statistics and skewed reporting of them has become the single most determining factor in governments ability to control the public. Facts and reality are out the door.”
Well said Dean, where ever you are.
April 2nd, 2009 at 2:59 pm
Steamworks is full of business people that can afford $10 burgers and $6 beers. You want to see empty restaurants, go to Yaletown, all the restaurants there are empty during the week now. Who wants to spend $24 on a sub par entree and $8 for drinks when your condo is losing around ~4% a month? If I am going out for dinner these days, I’m bringing my Entertainment book with me.
April 2nd, 2009 at 3:10 pm
#45, Spectrum
Everyone will use the entertainment book on Yaletown Restaurants. Whenever I pass by the Yaletown Brewing Co. I see it packed with people. Go to Milestones during lunch hours, there’s always a lineup, same with the Urban Thai.
Maybe we should all meet up at Yaletown and I’ll show you the truth, and it will hurt the bears because you’ll see an economic boom in that area.
Everyday, when I head out for lunch, I try to look for the cheapest deals, then when I pass by a cactus club or milestones, I see obese men with hot white blondes waiting in line for a table. I recalled 5 yrs back, $10 can get me burgers and fries at restaurants, now $10 can’t even get me an appetizer. Goes to show that we’re in boom times, not bust times.
April 2nd, 2009 at 3:42 pm
That could be true for lunch time, but anytime I go to Yaletown at night, always empty.
April 2nd, 2009 at 3:54 pm
“Goes to show that we’re in boom times, not bust times.”
This city/province of ours has ALWAYS been the “last in” and the “last out” of any recession.
You’ll see.
April 2nd, 2009 at 4:03 pm
I was looking at a condo in North Delta the other day just for the hell of it, and was speaking with the RE agent, he was trying to tell me that everyone is buying now because they are coming to the realization that the interest rates are so low and now is the time to take advantage of it! Condos/houses pricing may drop, but interest rates will soon double. He said business has never been better!
April 2nd, 2009 at 4:06 pm
Supraboy, I have a family member who was just laid off from one of the best restaurants in yaletown because business is so bad. Ask teh waitress or waiter next time.
Lunch time is not profitable for the restaurants.
Give it up, pretending to be an idiot was funny for the first few posts but it’s gotten old.
April 2nd, 2009 at 4:07 pm
also supraboy it’s no one on here’s fault that you live with your parents and have never even kissed a girl.
Why don’t you go for a drive to Surrey in your surrey supra
April 2nd, 2009 at 4:56 pm
No bottom yet for RE that’s for sure. Possibly for the stock market though.
April 2nd, 2009 at 5:07 pm
The stock market is going through a bear trap right now, before the next bear run will start.
April 2nd, 2009 at 5:08 pm
Spectrum:
#47 Spectrum, The owner of ‘Brix’ bar restaurant in yaletown was just interviewed in the Province newsrag a few days ago and he said that the bars and restaurant business was so bad that most business owners were barely hanging on hoping for better days. I think I’d believe that guy rather than some others who have no direct knowledge or experiance.
April 2nd, 2009 at 5:10 pm
We used to get updates on nvcondos.ca for the latest monthly stats. With the new website version, does anyone know where we can find the March figures?
April 2nd, 2009 at 5:12 pm
xyz:
#49, Intrest rates may be at an all time low but as the Credit Suisse banker said ” A 10 to 20 % discount may not be enough when prices are still 50% to high”.
Hmmmmmmmmm a banker with no commission on the line or a shit for brains real tard who needs an excuse to go and get pissed. Tough choice, not!
April 2nd, 2009 at 5:24 pm
#55 – here are the latest rbgv stats if that helps:
http://www.rebgv.org/sites/def.....202009.pdf
April 2nd, 2009 at 5:29 pm
Warren:
#52 What good is the gyrating stock market to the unemployed? Will they take thier last EI cheques and become day traders?
April 2nd, 2009 at 5:36 pm
Enduser:
yes i noticed that gavin h has a
“real estate” site
no blog for comments
and no price stats
or charts……WTF?
April 2nd, 2009 at 5:48 pm
Metro Vancouver Real Estate Sales bounce back. but i suppose march sales are always better than feb? and i would guess it’s still lower than last year…
April 2nd, 2009 at 5:57 pm
blueskies:Bear realtors and bear economists have no place to live these days even chicken shack price went up.Market was showing stability since you never find $400.000 price reduction.When was that last time? September 2008——- gone baby gone.
April 2nd, 2009 at 6:10 pm
So much for Paul Boenisch’s buddy Gavin Hughes keeping the website going, he has replaced it with this ugly mess:
http://www.nvcondos.ca/
The worst part is that he has linked in to MLS’s horrible, non user friendly map based search tool so too bad for us that are tracking using the standard Vancouver West, False Creek North criteria.
Does anyone know of another agent that provides email updates based on the old system like http://www.realtylink.org?
I was going to use Paul as an agent but don’t know about this Gavin guy.
April 2nd, 2009 at 7:23 pm
REBGV detached benchmark for March down again to $649,342. Now -15.8% or $121,979 off peak.
So much for the market bottom and spring rally.
http://robchipman.net/blog/
April 2nd, 2009 at 9:18 pm
There might still be hope:
https://www.blogger.com/comment.g?blogID=5922463868756065883&postID=1856900706845781829
”
Gavin said…
Where did the stats go????
I was told by the fine folks at real page that they were upgrading me to a new “improved” site today and EVERYTHING would be transferred over. To my suprise i see not only does it look like crap but all the stats are gone and i now have no access to the back end.
I will call them first thing in the AM to see whats going on.
I’m not amused!!”