Friday Free-for-all!
It’s time for the weekender open-topic discussion! Here are a few stories I’ve noticed lately:
-Jameson House wins court approval to restart project
-Richmond is lower mainlands hottest market
-Real estate is not a religion
-Harper: Effects of recession beginning to ease
-Carney: Recovery still has a long way to go
-World Bank: Global economy to see steeper contraction
-Does the federal funds rate affect mortgage rates?
-USA: The landscaper is foreclosing
-20 largest bankruptcies in history (graphic)
So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!
June 12th, 2009 at 5:41 am 1
"Real estate is not a religion"
The first page was relevant, but the second page went on a big tangent about immigrants? Weird.
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June 12th, 2009 at 5:53 am 2
Jameson House is a joke. They came late to the party and tried to push the envelope (I still have a pamphlet from spring 2008 advertising $800/sqft), and now they see small signs of life in the market and want to jump back in?
Good luck selling high end, pretentious luxury in a recession.
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June 12th, 2009 at 6:08 am 3
I stand corrected on the pricing. It was actually around $1000/sqft. I could only find a small pamphlet with 3 prices:
890 sqft $879000 (organic)
815 sqft $899000
1930 sqft $2725000
They marketed "organic" suites, which basically means fewer walls and a more 'rounded' shape. Who wants to pay more for less privacy and curved walls which are a pain to fit furniture around?
Is there even a market for this crap anymore, even at cheaper prices?
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June 12th, 2009 at 8:07 am 4
mino3: Is there even a market for this crap anymore, even at cheaper prices?
I'm guessing not, since the whole court case was to see whether presales buyers would be allowed out of their contracts based on the delays. Those buyers got screwed by this court decision (well arguably they were screwed the day they signed the contract).
http://www.theglobeandmail.com/news/national/who-…
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June 12th, 2009 at 8:59 am 5
Great post in general (Pope I assume ?)
I love my friday free for all
By the by, I'm seeing more houses for sale in Kitsilano. I know of 2 or 3 "sold" places from last year that have had their curtains drawn and the grass unmowed since the "sale".
Yesterday there were gardeners mowing, installing flowers and thouse cheap walkway solar light posts. I'm thinking these houses are going to appear on MLS again (at the original sale price that didn't work last year).
Rising mortgage rates, green shoots, bring it on.
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June 12th, 2009 at 9:25 am 6
The problem with green shoots is that you can't live on them.
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June 12th, 2009 at 9:43 am 7
I noticed on the latest tout sheet put out by Century 21 that the stats they are quoting are from April which coincides with the BOC coordinated dump on intrest rates. So , typical recession behaviour sees sheeple diving into the lowest end pf the market on purely monthly payment driven principle. This is not the sign of a healthy market. The latest stats have already shown a marked decrease in activity going into June. Why aren't they using the current market to balance the news? Duh, I wonder why? Intrest rates have risen sharply and are now on an agressive upswing. Oh Oh.
http://www.vancouversun.com/Business/Richmond+Lan…
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June 12th, 2009 at 9:44 am 8
The problem with green shoots is that if you eat them before they bloom you're left with nothing but dirt.
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June 12th, 2009 at 10:18 am 9
I wonder sometimes… I've seen this market defy all logic, all fundamentals, all reason in the past… could it do it again? Is it doing it again?
I was wrong when I thought the inventory would spike again this year.
I think I'm weakening. Hearing all your comments helps, but my level of conviction that I once had regarding this market has changed. I think I completely underestimated the amount of pent-up demand and demand in general that was created through looser lending practices.
Anyway, despite all that I'm still priced out and not willing to buy something that is, by all measures, unaffordable to me.
We'll see what happens, I guess.
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June 12th, 2009 at 10:48 am 10
Vansanity: Vansanity, hang in there. This thing is far from being over.
Watching the Vancouver RE market is like staring at disbelief as a baseball literally hangs in mid-air, insouciantly defying the laws of gravity. Alas, we're not special here, and if you look at recent comparative charts of North American cities, you'll notice that even after this spring's slight uptick in prices, from their peak, Vancouver prices have fallen faster and quicker than every single city in N. America save Miami. My informed opinion is that Spring 2010 will finally be the time of reckoning.
On the other hand, if prices don't fall, then I'll be a happy renter all my life. Every time I get a slight itch to buy, I just remind myself of how much more I'd have to be shelling out to the bank, insurance company, strata board, etc., if I "owned" my place rather than just rented it. Then I go out and have an expensive dinner
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June 12th, 2009 at 11:34 am 11
Looking at most US cities that have had their RE prices fall of a cliff, it seems to be from summer until November when prices fall. And during that time they have fallen pretty hard. What we've been seeing so far this spring it a slight uptick, which is also helped by extremely low interest rates. Once the uptick is gone and interest rates start to rise, even the mighty Vancouver RE market will fall.
I do agree with oneangryslav that Spring 2010 will be a time of reckoning. Interest rates will be far higher, the world economy will know that there will be no fast recovery and all the speculators in Vancouver will be dumping.
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June 12th, 2009 at 11:57 am 12
"Richmond is lower mainlands hottest market" Great! And then we find out that the latest real-estate advertising scam is to find any "chunk" of land that may have appreciated in value over the last year and tout that as the direction in which the market is heading. Oh and simply ignore the bigger picture, which depicts a precipitous downturn in housing.
What's next…? "The hottest market: Down only 15%! Buy now!"
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June 12th, 2009 at 12:27 pm 13
"Vansanity Says:
June 12th, 2009 at 10:18 am
I wonder sometimes… I’ve seen this market defy all logic, all fundamentals, all reason in the past… could it do it again? Is it doing it again? "
Don't worry, it's tough going against the herd, and scary sometimes. Remember, the end of every bubble is when the last bear capitulates and buys in. Don't be that bear!
I trade short on the stock market quite often and every time there is always a point where I'm underwater and start to doubt myself, but every time I hold on I always make out like a bandit in the end. It's only when I close too early that I regret it later.
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June 12th, 2009 at 12:47 pm 14
Spectrum: "Looking at most US cities that have had their RE prices fall of a cliff, it seems to be from summer until November when prices fall. And during that time they have fallen pretty hard."
They also had higher MOI going into the summer. Vancouver MOI is reasonably low right now. Unless listings really take off in the summer and fall I think prices won't drop more than 5-10% this year.
2012…
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June 12th, 2009 at 1:19 pm 15
if the rates are up much higher, how would that force lower prices if the # of inventory is the same?
What im saying is, suppose most of those people that bought at peak/near peak etc. dont have to sell simply because they were able to lock in at the low 3.xx rates. In this case, they would probably be able to afford the monthy mortgage, so why would rates jumping in 2010 matter to them? It would only affect those that truly have to sell, and those that truly have to buy. In that case, if those that truely have to sell is not a lot, wouldnt prices stablize becuase they will be bought by those that truely need to buy (or think they do anyways)?
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June 12th, 2009 at 1:23 pm 16
Jameson House?
At those prices, the units better be ORGASMIC!
Properties that have higher rent yields are going to have sticky prices on the way down.
I'm talking about houses with mortgage helpers, duplexes, cheap apartments located in convenient locations, etc.
Detached properties in East Van are particularly sticky because high concentration of certain ethnic groups (Asian, South Asian, Indian) living there tend to be pretty conservative in their borrowing and will not be in a hurry to sell. They can make the numbers work by having extended family living with them and so forth.
The top end needs to fall out first since all the short term investors will get shaken out. They can't make the numbers work and carry the units.
Then the price compression happens as everything trickles down.
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June 12th, 2009 at 1:31 pm 17
Vancouver won't come back down to earth until the flippers go bankrupt and people stop playing games. It would help if people waiting on the sidelines would shed their mass delusion about the need to live here.
Right now, nice starter homes in southern California are as low as $70,000 and FALLING. With the money you'd save over a lifetime of being debt-free, you could afford a great standard of living. Vancouver might be nice, but you can't tell me it's ten times nicer.
I suggest the impatient take a good look elsewhere, because opportunities abound. Personally I would like to live in Vancouver because of family, but I'm not going to wait forever when I can easily afford a nice home virtually anywhere else.
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June 12th, 2009 at 1:35 pm 18
On a sideline: I am moving to Victoria, but noticed that rents are quite high there, even dungeons. Housing is expensive too.
Question: What is the reason for rents and real estate to be so high in Victoria?
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June 12th, 2009 at 2:01 pm 19
riff raff:
Only 90 minute boat ride from greatest city on the planet? Dunno, but when you factor all things in, I think Victoria is more overpriced than Vancouver, and that's saying a lot. The whole entire BC RE market makes me ill.
My brother bought a house in cloverdale for $500,000. Brand new house with virtually no lot at all. But hey, the GST was thrown in so good deal! Don't even get me started on the idiocy out there, even my own family.
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June 12th, 2009 at 2:32 pm 20
Anonymous: Temporary low rates only push the problem further down the road. How long can you lock into a 3.xx% rate for? a couple years? What happens then if you're just scraping by and you need to renew at a higher rate? you sell right?
What happens if a bunch of people are in the same situation and have to sell at the same time?
At least in the US they lock into these low rates for the entire 25 year mortgage term.. In Canada it seems like a 10 year lock is about as long as you can get.
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June 12th, 2009 at 3:46 pm 21
mold city,
yes i understand low rates only delay the evitable. What I am trying to say is in the short run, eg next 1-4 years, how can people be predicting a huge drop given this case? would it make more sense that if RE is to totally tank, it'll tank in 5 years? (Ok im assuming most people would have locked in at the 5 year 3.xx rates)
I am ready to buy a house now. I think its ridiculous how much housees costs, but with the spring bounce I am getting less and less pessimistic about RE in the short run. I dont want to wait another 5 years. I dont mind paying more then renting for having my own place, but the premium is absurd right now.
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June 12th, 2009 at 3:53 pm 22
VanBanker:
oneangryslav:
Thanks to you both. I can relate to the thoughts on short selling and expensive dinners!
I'm not about to cave in. I just don't have the same conviction I once had.
What prompted this was that: I had a friend approach me recently because someone they knew were about to buy and he was trying to have me to convince them… [that's confusing, I've been drinking on a patio all afternoon so I apoloigize, and I'm about to go back, I know, life sucks!]…. not to buy. I ended up telling them to do their own research because I maybe wrong. I acted like a disclaimer.
If I'm being true to myself. I honestly don't know anymore. I know what the fundamentals are telling me. I know what the trends say of spring. But I don't know that right. It's a truly disturbing yet humbling position to look at myself from. I don't like it.
Crash already! I do agree with you guys on spring 2010. I'm just not as sure as I once was.
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June 12th, 2009 at 3:54 pm 23
"I was wrong when I thought the inventory would spike again this year. I think I’m weakening."
"I do agree with oneangryslav that Spring 2010 will be a time of reckoning."
No it won't, and neither will Spring '11, or Spring '12 or Spring '13.
Really, I don't know why so many people are having a conniption about the recent price spike. Prices always spike in spring – ALWAYS. When the spring is over, inventories will rise once again and prices will continue their inevitable plunge. Then there will be another "spike" next spring, followed by yet another price plunge in '11, etc.
Anyone who can't see this coming, especially anyone who's been following this blog, deserves what they get if they're foolish enough to buy now.
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June 12th, 2009 at 3:59 pm 24
Anonymous: I'm not expert but hey it's Friday and I'm tired of working. I think the argument goes something like this: Imagine there are 25 exactly identical houses on a block – people paid $500,000 for each one. Some guy needs to sell (moving out of town) and the best price he can get is $350,000. What are each of the other houses now worth?
And the reason he only got an offer for $350,000 is that affordability is based on the monthly payment people can afford, so same max monthly payment and a higher interest rate means lower principle.
Or something.
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June 12th, 2009 at 4:29 pm 25
The rental rate for downtown condo in San Diego and Vancouver, seem to be slightly over $2/ft.
But compare the selling price for these two comparable units:
Vancouver $350k
San Diego $150k
Both units are in newer buildings downtown, and the San Deigo unit is slightly larger.
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June 12th, 2009 at 4:53 pm 26
Yalie: "Prices always spike in spring – ALWAYS
Yup. It happened in US cities in 2005, 2006, 2007, 2008, and again this year. Vancouver is no different. Prices are too high compared to rents and incomes. It's so obvious where we go from here.
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June 12th, 2009 at 4:54 pm 27
Vansanity:
Could't agree with you more, I could have posted this myself. I don't know what the hell to think anymore.
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June 12th, 2009 at 5:26 pm 28
"Crash already! I do agree with you guys on spring 2010. I’m just not as sure as I once was."
Bears capitulating, as sure sign of a bubble almost ready to pop.
Keep the faith my friend , there is no other way this thing can end.
If a weak economy doesn’t pop it, a strong economy will.
Either way , it’s just a matter of time.
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June 12th, 2009 at 6:06 pm 29
I'm also disheartened by the recent rise in prices. But if things don't start to move, I may move to a more upscale rental in a year or so.
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June 12th, 2009 at 6:36 pm 30
We've a kiddo on the way and that just gets you thinking real fast about what's important to you. Hubby and I were talking last night…We think that fundamentals point to more affordable real estate in BC's future but if it doesn't happen in the next couple years, I think we're outta B.C. We'd like to stay close to extended family but as parents you want to provide a nice life for your children. BC's cost of living makes that tricky. It's not too bad as a single person or young couple but add in kids and renting an apt or basement suite isn't really appealing anymore. I've had a mortgage debt before and hated it! I would hate what today's housing debt would mean for my family. I mean we almost have enough to pay in full for a place in Ottawa! Hmmm let me see, good health care, decent jobs, decent crime rate, same average pay as here and houses are reasonable! I can deal with cold winters and hot summers. The savings in housing = alot of trips to visit B.C. with its mild weather, pretty parks and great mountain skiing. I'd prolly just go to Hawaii with the kids instead though.
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June 12th, 2009 at 6:42 pm 31
I was just going through some listings and came across this description for a new condo beside Coquitlam Center Mall. Asking price: $469,000
Assessment Value is $517,000. Such a good investment opportunity.Easily rent it out $1600/mth.
Nearly $500/mo for maintenance and tax. Even if you put down 20% ($94,000) a 25 year mortgage at 3% results in nearly $2300/mo w/ maint+tax.
How is this "such a good investment opportunity" when rented out at $1600/mth??!!
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June 12th, 2009 at 6:45 pm 32
Sounds like most of you bitter renters have an income problem. Solve that and you can buy too. I really don't understand why you guys can't see this most basic thing.
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June 12th, 2009 at 7:04 pm 33
I made may mind up that I won't do anything until after the 2010 games, it could be the wrong move but time will tell. In the meantime I certainly am amazed that Icarus continues to fly so close to the sun.
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June 12th, 2009 at 7:08 pm 34
Yep, Vansanity, I hear ya. I started thinking, meh, what if the American economy starts turning around and we just never clue IN, we sail along on a bubble of delusion? What if we end up with one of those painful bleeding for 20 years "soft landing"? How would it be possible?
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June 12th, 2009 at 7:08 pm 35
(( NB: I still am bearish, but this spring's rebound was a bit of a surprise to me. ))
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June 12th, 2009 at 7:09 pm 36
Anonymous:
I am lender and have first hand knowledge regarding speculators holding out. Most of them have VRM 0.75% to 0.90% below Prime. So currently their mortgage rate is between 1.35 to 1.50%. How many of them lock up into 5 year term when the rate was 3.5%? Very few. It is very hard for a person to lock up with a 1.15% rate increase rightaway especially they are thinking short term to sell. I have none of my clients lock up. So if the Prime goes up next year by big numbers, you will see lots of blood.
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June 12th, 2009 at 7:41 pm 37
afc:
Sorry, typo. The rate increase should be over 2% rightaway.
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June 12th, 2009 at 8:43 pm 38
Does anyone have a prediction on what the outcome of Rennie's newest project pre-sale which starts tomorrow and will be finished Fall 2011. I know presale is a bad word and should be very interesting to see what comes of it. Drove by and didn't see any greater fools with the sleeping bags even though the weather is great for camping…
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June 12th, 2009 at 8:49 pm 39
"what if the American economy starts turning around…"
A BIG ship like that takes a long time to go in any direction. Rest assured, this piddly economy of ours is a mere tugboat. Even when the US does turn around, it will take a long time for the wake to reach our boat.
We're always the last in and the last out. Take it from me.
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June 12th, 2009 at 9:22 pm 40
justspiffy, have you considered co-op housing? That's where I'd be if I had kids.
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June 12th, 2009 at 9:32 pm 41
Bears, we've been "fighting the tape" since the VHB days. In that time we’ve missed out on huge amounts of appreciation which would make the recent drop look tiny. ie. up 200k instead of 260k. Real estate is a religion in BC, the boomers are just starting to retire and rates are outrageously low. I'm buying! Capitulation? Yes… If you keep making the same prediction for long enough it will probably come true but your timing will be wrong.
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June 12th, 2009 at 9:42 pm 42
DaMann:
Anybody watch Gran Torino?
This post reminded me of the scene with Clint Eastwood complaining about his $10 haircut.
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June 12th, 2009 at 9:50 pm 43
PorkyFlu:
You don't really have a firm grasp on the notion of value, do you? Cash flow!=value.
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June 12th, 2009 at 10:10 pm 44
ted are you seriously considering buying now. If you were going to capitulate you should have done that a few years ago. I understand your frustration but why buy just rent. Even if real estate doesn't drop it still doesn't make sense to pay more to own than rent.
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June 12th, 2009 at 10:42 pm 45
Problem with "HotSpots" (Century 21 "Research" all over papers today)
Area A Price Index 4/08=100 3/09=80 4/09=100
Area B Price Index 4/08=100 3/09=85 4/09=94
Price increases 4/08 to 3/09 and 3/09 to 4/09 and yoy
A -20% +25% 0%
B -15% +10% -6%
Total market has fallen from avg of 100 to 97 ie -3%
BUT look at the hotspots from march to april, wow. We were wrong after all.
I'm off now to go and buy as much house as I can possibly 'afford' before I'm priced out….again.
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June 13th, 2009 at 12:19 am 46
/dev/null:
ok, i understand the whole buy at higher interest rate/lower principal thing and how high interest rates should drive house prices down due to increased mortgage payments. my question is, if that is the case, why did people buy in 2008, 2007 and so on, when prices were rediculous and interest rates were not 3.xx%. the monthly carrying costs on those places should be quite high back then. they all can't have bought simply because they thought prices were gonna keep increasing right?
maybe the norm now is to have dual income to support a home, and the typical home is a townhouse/condo depending on where u live, so younger people are "used" to these prices and do not think it's overpriced?
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June 13th, 2009 at 4:39 am 47
46, because people are retarded sheep.
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June 13th, 2009 at 7:06 am 48
#46 Alot of my friends are dual income with a suite to make the payments, if they have bought a home recently (last 3 years or so. Some of them got really stressed when the whole stock market/Real Estate thing happened. They couldn't even stand to watch the news. If one of them loses a job I'm not sure how they'll make it. I'm pretty sure they have everything into the house. Some of them are having a rough time of it already as they work in construction, but so far parents are helping them out. It is amazing how long people can survive for before they getting really desperate. EI, Parents help them, max. credit cards, and then a period of plain just not paying the bills. Some just go bankrupt rather than sell their house. It all takes time and all this has just started here.
Alot of ppl my age though bought before things went crazy and talk about how thankful they are cause they wouldn't be able to afford these prices. Just the young'uns or people new to the area or those of us a little late to settle down and be ready to buy, who are really feeling the affordability.
Honestly I can see why some would jump in now. I mean if you'd been waiting years already for the market to give you a break and you just want that house. Your kids aren't getting any younger, your wife is pressur'in you and you think losing your job couldn't happen to you. Impatience sets in. Interest rates are low and prices down a bit. The monthly payments work. You plan to live in this house for years and you say to yourself even if prices go down in the short term they "always go up" in the long term.
Some of us young'uns don't have the fear we should of not having enough money to pay our bills. Most of us really have never gone without. Think about it, a whole generation of kiddos have never lived through a bad reccesion or were really little at the time. There is a real sense of entitlement among young people.
http://www.reuters.com/article/lifestyleMolt/idUS…
"A survey for Australia's St George Bank found almost two-thirds of Generation Y-ers — people born from the mid 1980s to early 1990s — are expecting their parents to help them out with their rent, their wedding and when buying a home."
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June 13th, 2009 at 8:54 am 49
Interesting… when a company avoids debt and accumulates cash it’s looked upon negatively because they are not utilizing their capital effectively. The bears on here think accumulating large amounts of cash and no debt is the correct thing to do. It's a safe thing to do but perhaps not the most effective.
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June 13th, 2009 at 8:58 am 50
Risk = reward. The price paid for a conservative approach over the past 10 years has been incredible.
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June 13th, 2009 at 9:11 am 51
Keep the faith people. Values have only one way to go, that is down. Interest rates are rising, people are still getting laid off, EI payments will stop soon, rents are declining, incomes are declining, cost of gas and food are increasing, US is still is collapse mode……………. not sure if anyone here has looked into the vaditity of the front page articles (I refuse to read any Sun or Province paper, even online stuff) but I wouldn't be surprised if the stats were fudged. Let me guess a realtors association economist produced the report? Anyway, for me the big news, (front page in my paper) was the 0.4% increase in bond yields this week and major banks jacking up mortgage rates. Governments can do nothing about increase cost of lending and it getting passed onto consumers.
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June 13th, 2009 at 9:16 am 52
justspiffy: "It is amazing how long people can survive for before they getting really desperate."
What's "really desperate" anyways? Prostitution? Selling kids into slavery? One thing is for sure, anyone who is "really desperate" or just plain "desperate" isn't going to buy a larger house anytime soon. Move up market: dead.
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June 13th, 2009 at 10:26 am 53
I work with hundreds of people who are getting laid off. I'm hearing sad stories of owners having to sell condos at a loss, and happier stories of renters who are taking the summer off before they look for other work. Oh well, people live out the consequences of their decisions.
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June 13th, 2009 at 10:26 am 54
Vancouver is a beautiful city. I’ve traveled enough to know as much. It is also a great place to live. People work, come home and enjoy all the recreational activities the wondrous nature of this region provides – skiing, hiking, kayaking… Our leaders are lazy, yet they provide a strong social security net, and are keeping this place affordable to all demographics. This is a place where seniors and students are treated equally to all, and middle class rules, especially if that middle class is unionized. What keeping us entertained are regular cops raids on the house of a premier, since he was a generous man and gave out one too many casino licenses, but also the complaints of some rich snobs whose boats are rocked by waves from fast ferries.
This is a place where all religions are accepted, and none is universal… This is a place where a home is what it is, and not a religious place of worship. This is Vancouver on the turn of millennium.
…Until the prophet came…
The prophet who promised honesty, accountability, and more than anything, the promise of unbound wealth…
The prophet and his disciples swept across our great province, taking almost every region. With such unbound power to rule, the prophet quickly turned to his true task. There were some minority groups who did not believe the prophet’s words, such groups were deemed unimportant, and their social benefits were cut. The prophet has been building temples across Vancouver for quite a while, and had personal vested interests in those temples. But he did not think that people valued his temples enough, he thought the temples should be worth at least three times as much. So he went abroad and brought games to Vancouver. His disciples went on television and proclaimed BC to be the “best place on earth”. The prophet went North and shut down manufacturing plants. The prophet went to Yaletown and evicted all the IT geeks and the industry along with it, since was a holy place to build the most expensive temples. He gathered many peoples from many professions and ordered them to abandon their trades and build temples instead. People were told if they convert their home to a temple, they would instantly find many riches. People believed and converted. They went to big banks and borrowed a lot of money because they could buy options to buy temples in the holy place called Yaletown. More people converted, and it became a holy practice of homage to offer senior converts more money for their option to buy temples in the holiest place. Soon the temples were worth three times the value, just as prophet thought. Most converts were happy because they would own at least three temples, and if they needed money they could just go to the bank and borrow more, since holy temples are worth more than any money in the world. The converts did not relax they did not ski, hike, or travel, it is against their religion to do anything other than buy temples and sell it to the next convert.
But suddenly, BC has started running out of converts. There were no more believers, only infidels who dared to spend their time traveling from “the best place on earth” rather than buying and selling temples. The prophet and his disciples saw his temples losing wealth, since the only way the temples could increase in value if more people converted. The prophet’s disciples blamed “the global crisis” for these losses, and when the prophet was asked why Vancouver’s housing was the most unaffordable on the planet, he replied its because it’s a holy place and all the people around the world want to come and convert to his religion. The prophet knew that in order for his plan to work, he needed to collect a lot of duties on the value of the temples, and since Vancouver is a holy place, the price of the temples was frozen at the highest level. Many converts were happy because their religion resided in unabated belief that the value of their temples never goes down, and they gladly pay more duties to the prophet for that belief.
The converts saw that prophet and disciples could not increase the wealth of their temples anymore, so they turned to convert infidels among their families and friends. They said to be happy, you needed to abandon things that make you happy, such as traveling, skiing, nights out – and spend all your moneys buying a 40-year-old temple. Because the rain in Vancouver is holy, temples that leak only add to the value as the years go by. They say after you pay bank your dues, in 35 years, you can sell your 75 year old temple for many millions, because the older the temple the more expensive it is, 35 years of soaking by holy rain make it grow holy mold…
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June 13th, 2009 at 10:30 am 55
Great stuff Anob!
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June 13th, 2009 at 10:33 am 56
One thing about losses in real estate, is people underestimate them. They just look at the price tag of when they bought and when they sold, and don't consider all the other costs. Even if you "break even" by selling at the same price as you bought, you still had all kinds of money you sunk into realtard fees, taxes, strata fees, sweat equity etc. Its best to keep your mouth shut and not remind the sheep cuz its too late for them and it will just piss them off.
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June 13th, 2009 at 10:34 am 57
Did u ever think about how the prices tend to go up when the financial pressure increases, especially with respect to the owners and buyers? I think this is the main reason the Van RE has hit the roof. People are on the fast track and take too long to make a decision. Human nature, I guess. With interest rates at historical lows, it is likely only a matter of time before banks realize there is a problem with the system and take adequate steps to correct it.
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June 13th, 2009 at 10:43 am 58
Our spring housing bounce coincided with a stock market bounce, a low interest rate bounce, a government bailout bounce, an FTB this-must-be-the-bottom bounce, a media-fed green-shoots-recovery bounce, and an Olympics-will-save-us bounce.
It's not surprising that the market bounced high, and it won't be surprising when the bounce fails and the market falls much lower by the end of the year.
I won't buy before late 2010, but I expect prices to have dropped precipitously by then.
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June 13th, 2009 at 10:46 am 59
jimbeam: Definitely…I couldn't agree more. I saw an article in the Globe & Mail last week that mentioned this same concept. I think tho w/the number of CQMI contracts that are popular these days, this could take some time to unravel. Cheers!
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June 13th, 2009 at 10:50 am 60
Bob: tell it to GM, Chrysler, and all the banks.
Risk can suggest reward, but it doesn't equal it. Risk can also incur abysmal failure, and everything in between.
Bubbles always look like a sure thing to suckers in the middle of them, but after the fact they always look like the scam that they are. Nobody is now complaining that they didn't invest in the dot com bubble.
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June 13th, 2009 at 11:31 am 61
This is to bring in notice of user/poster that site administrator has fixed one poster and linked him to cbc article from january 2008 that says home prices to increase 10% etc.
I want to bring this in notice that any prediction stated in the articles are not mine nor does it belongs to media and news paper.They are there to run their bussiness,They will never tell you that "Vancouver Real Estate Never Goes Down"or else that will shut off their bussiness.Media always chose a medium to communicate by someone for example articles by some agencies or boards let's say RICHMOND REAL ESTATE NEVER GO DOWN,COAL HARBOUR REAL ESTATE NEVER GO DOWN,ETC.SO is there any doubt about 15 different location monitored by individual poster? Hello? If you can't face the truth would you mind shut the fuck up? Hello? And by the way who the fuck has deleted comment number #4 on last thread ? Hello? it was TD vs FF if you can't face the lower interest rates through the link was provided then shut the fuck off again.Hello? look to whom jesse is talking to @#5 on last thread http://www.youtube.com/watch?v=Q0LXAu15J54
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June 13th, 2009 at 11:43 am 62
Nobody is now complaining that they didn’t invest in the dot com bubble.
So you've stayed away from tech stocks since then? If so your choice makes no sense. There is always somewhere to make money and you're right, risk does not always equal reward, just potential for a much bigger reward/loss.
GM & Chrysler? Come on, they're two of the most pathetically run entities around and deserve to fail. The only risks they took were the amazingly obvious bad ones.
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June 13th, 2009 at 12:16 pm 63
justspiffy:
very well put
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June 13th, 2009 at 12:48 pm 64
thanks for answering my questions guys.
I am young (mid 20s) and yes, in order for me to buy right now, dual income is necessary, and I was thinking of living in the basement suite while renting the top of the house to help pay off the mortgage sooner.
The spring bounce really caught me off guard, and im not at all versed in fiance, so what i see is just stories of how we're recovering from the recession etc.
I had thought about the whole job loss EI situation, but honestly, I only know of one person who lost their job. Restuarants, store, etc. seem just as busy to me and when i talk to my coworkers, everyone believes its not that bad, and that yah, we are recovering. When I read comments here, and other places, its more gloom and doom than what im noticing. Coupled that with the spring bounce, I am doubting everything now.
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June 13th, 2009 at 1:53 pm 65
Wow, when I was in my mid-20s, the last thing I thought about was buying real estate. Kids these days
Anyone else a Red Dwarf fan? Remember that fantasy world episode where Rimmer can't even imagine himself into a good situation. He ends up with a dumpy wife, several bratty kids and a mortgage. ;P Then the tax collector comes to break his thumbs.
If I had my 20s to do over again, owning a Vancouver crackshack and living in its basement would not be on my list.
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June 13th, 2009 at 2:26 pm 66
The episode I mentioned:
http://www.youtube.com/watch?v=xpaUNQ4a6Bc
Go to 5:54
Lister: Rimmer, you fantasized that you had seven kids and a mortgage.
Rimmer: Help
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June 13th, 2009 at 3:48 pm 67
yup. and why would one want to take on all the risks and costs of owndership just to live in a basement – so that one can move upstairs in 35 years once the mortgage is paid off?
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June 13th, 2009 at 4:55 pm 68
i would prefer to rent than to buying (or so until the spring bounce started scaring me..), but bf believes in the whole renting is throwing money away idea and i cant convince him otherwise.
Ive done the #s at a higher rate, based on current income, it'll take us about 13-14 years to pay off house on our own, or 8-9 years with us living in the basement and renting out the top. (we live/work/want to buy in langley/surrey, so houses are cheaper).
We really dont need much space and since there's just the 2 of us, we're fine with living in the basement until our future kids are of age to live in a room of their own (in about 9-10 years). Thats when we intend to move upstairs. (I refuse to buy a townhouse/condo/apartment)
we're not saavy investors or anything, heck we dont even own mutual funds. In fact our down payment is just in a high interest savings account earning a whopping 0.75%.
Maybe you guys will think we're nuts or very naive
but we're simple people, and i guess we just feel we're ready to make that plunge.
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June 13th, 2009 at 5:20 pm 69
Anonymous 68: "we’re not saavy investors or anything, heck we dont even own mutual funds. "
Well then heck you're doing better than 80% of the population who invested in mutual funds since 2000 and have net lost money. Who's the "savvy investor" now?
You can certainly "make the numbers work" at current rates and prices but if you overpay for an asset, you overpay. As long as you are aware you are overpaying and prices are most likely to be lower for a long time, go for it. But please do all on this blog a favour and don't say your home is a good "investment" in the financial sense of the word, 'cause it ain't.
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June 13th, 2009 at 6:27 pm 70
RCMP discover secret pot room in upscale Surrey home
http://tinyurl.com/n98swe
don't need no stinkin' mortgage payments here!
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June 13th, 2009 at 7:06 pm 71
"Maybe you guys will think we’re nuts or very naive
but we’re simple people, and i guess we just feel we’re ready to make that plunge." Very smart move! I am sure you may have rented a lemon (car) and maybe even bought one?If you HAD to do one again which would you do?. People are buying 1/2 million condos with a worse warranty then a toaster from Canadian Tire! Go figure! Why is there no warranty for 10 Years? Cause the developer knows damn well nothing will work after two years! Otherwise they would be competing with each other as to who offers the biggest warranty. So hey you two are smart, only a complete and total idiot would spend .5 m + with a lessor warranty then a toaster! (Lesser)? Yup they give you a new one if the old one doesn't work. So….ask your seller for the same deal….bet your warranty isn't as good as Canadian Tire, Best Buy, or Home Depot….hope you didn't spend more than $30! Nope you both are right on!
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June 13th, 2009 at 7:26 pm 72
If anyone doubts the warranty is bunk check out the website of the broker that did the 2-10-10 warranty.
Looks like the insurance company didn't want to continue with the program. Hmm, now why would they forgo millions in premiums in a situation where the developer was forced to buy a warranty in order to get an occupancy permit to sell the product?
Think of the talented consultants that the insurance company could have hired to determine how long a condo would last?
If it was a publicly traded company they would have had to due their due diligence before forgoing said permiums, no?
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June 13th, 2009 at 7:30 pm 73
Effective January 10, 2008, the ^&*(*& Warranty Program is no longer enrolling new projects for either new construction or building envelope remediation work. For any projects that are currently enrolled in the program, we give you our assurance that we will continue to provide the same standard of service and support you’ve come to expect from &^&*(*.
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June 13th, 2009 at 8:55 pm 74
Noticed that the 5-year fixed mortgage rate of ING Direct has gone up again.
It was 4.19% (from 3.99%)after TD made the announcement of the 2nd rate hike mid last week. When I checked the ING site yesterday night, the rate has gone up from 4.19% to 4.49%!!
Not sure why ING jetted up the rate again for its 5-year fixed when I don't see other banks do the same thing.
Thoughts?
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June 13th, 2009 at 9:11 pm 75
"Not sure why ING jetted up the rate again for its 5-year fixed when I don’t see other banks do the same thing"
It's ING's turn at the front of the peleton.
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June 14th, 2009 at 1:23 am 76
Bob:
Yes, there's always risk and reward in any financial endeavour; most of us, however, believe that–right now–the preponderance of evidence points to there being much more risk than reward purchasing Vancouver real estate now. Does that mean that real estate prices won't rise? No, not at all. Every investor knows the old adage that a market can stay irrational longer than you (the investor) can stay solvent. But, given everything that we've seen in other cities around the world, there is no way that it will not happen here as well.
What's your view of the risk-reward of purchasing RE in Vancouver right now?
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June 14th, 2009 at 1:36 am 77
I'm in Edmonton and no matter what city, bubbleheads are freaking out by a small increase in the average/median price of a house/condo in the Spring. Doesn't anyone look at stats? Spring always has a bounce.
Relax, the drops come from August-December. This spring had a bit better bounce than normal due to the lowering of the prime to 2.25%, but as you can see that hasn't stopped mortgage rates from going up the last two weeks by about 0.6% (for five year mortgages).
If people look at all the past recessions, they enter and leave recessions in V type shapes. The milder recessions look more V-ish. The bad recessions like like _ and this current recession has been a bad recession, but people are saying its over? So this recessions looks like this? | ? Wow, that looks better than all the mild recessions we had. Since the government of Canada freaked out about the recession in March – we haven't had a recovery yet. Wait until unemployment hits 10% in Canada.
People have maxed out their loans with these mortgages. Time will not be nice to them.
Vancouver's going to get hit really hard – *ahem* tourism, lumber, etc.
If you're so desperate to buy, go buy now. We'll see you cry this winter.
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June 14th, 2009 at 1:39 am 78
Did anyone look at that B.C. hydro report a couple of years ago that stated 30-45% (i cant recall the exact number, close to 40%) of condos didn't use enough electricty for anyone to live in them? That means a good chunk, over a third are speculator condos.
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June 14th, 2009 at 8:44 am 79
First off, the talk about the warranty here is misleading. I work in the field. The 2-10-10 warranty is a really good product. We hire some very talented engineers in investigating defects and remedying the same. The company that backed away did so simply due to a lack of diversification in their underwriting portfolio.
Other insurers have stepped right up. There were plenty of premium dollars being made with little risk due to the contract's indemnity agreement.
Anyone with an insurance background would tell you you don't make profit through underwriting premiums alone, they make it by investing the earned premiums.
Secondly, I'll preface this rant by saying I'm a bear. What I don't get is why other bears rip apart someone who decides to buy. Isn't this person less competition for you when you eventually do decide the price is low enough to buy? Shouldn't the capitalist in you encourage your competition to make a mistake? When you attack a buyer, you sound as though you're trying to convince yourself of your argument. I just don't get it.
To the previous couple that's going to buy: Good for you, I suggest a variable rate mortgage on a property that takes up over 75% of your combined net income, good luck and keep us posted!
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June 14th, 2009 at 9:36 am 80
Vansanity: "Isn’t this person less competition for you when you eventually do decide the price is low enough to buy?"
Yes but if the problem gets too big then governments bail out stupidity and I end up paying for others' mistakes. Plus bubbles significantly affect the decisions people make — they either capitulate and have to overpay or they end up renting when they would normally prefer to own. This mis-allocation of capital or delay in preference in itself is an unnecessary burden.
Bubbles produce no net positive economic value. At best they are a cash transfer from one person to another, at worst the divert capital from more productive enterprises and mis-allocate capital until after the bubble deflates. The best you can hope is that after the bubble deflates you can buy at lower than fundamental value but you've wasted well over 10 years waiting to do so.
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June 14th, 2009 at 9:36 am 81
"First off, the talk about the warranty here is misleading. I work in the field. The 2-10-10 warranty is a really good product." It's a great product for the developer! The 2 applies to in-suite and building infrastructure such as HVAC etc. Under the present situation the developer has total controll to access these systems and in fact if a third party looks at the system the "warranty" if you call it that is void. The basic idea is the developer will patch things and make it work until the warranty is expired then hand the remains to the new strata which in many cases find building equipment non functioning and in total dis repair. One large new tower I was called to did not even have any permits for the electrical or steam installations. The developer also keeps the maintenance fee low for those two years by not doing any preventative maintenance allowing the unsuspecting strata to discover all the defects, which results in sudden increse in maintenance fees. All buyers should be aware that maintenance fees during the first two years do not in any way indicate what actual maintenance will be but in fact a low maintenance fee is indication of scam to sell the units rather than an indication of an economical building.
ENGINEERS regularly sign off on uncompleted substandard work,(if in doubt look at any as-built all of which are in- correct when compared to actual on-site conditions) which relieves the City of all responsibility. There is NO ONE looking out for the buyer ZIP!
Try to get a copy of an as-built from your developer after the two years…guess what they don't have any available. Show the City the differance between the as-built and what is on-site and they shrug and say see the Engineer, ask the engineer and they say hire me to correct it! 
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June 14th, 2009 at 10:09 am 82
No Longer Looking:
All is can to that is ………..
http://www.youtube.com/watch?v=lV17GxTh3Mo&fe…
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June 14th, 2009 at 10:11 am 83
#79 Yes, you are right. Did not hear that arguement before, but I think on the flip side, for every buyer, there is a support for higher prices.
However, the locomotive downhill run is in action now, so I dont think the odd buyer now is going to slow down this beast.
The seller is the one that avoided getting killed, just a few broken bones (losses) and hurt ego.
Somehow this downturn feels normal. It seems we are going back to the basics, no wasting, no strutting, humbleness, back to being frugal and modest.
Those that were strutting and flashing made me feel uncomfortable. Why are they trying to state (actions and behaviour) that they are "better"? What is the point? Or there is no point, just plain lemmeling and brain laundering. Lotsa ellls as in lala land. lol
Memory lane: Remember when people lined up outside sales offices to outbid each other for that "great condo"? It was FEVER! Media induced madness. Gold fever, one would think they pumped oxygen into the sales offices and display rooms.
Where are they now? Kraft dinner? Master card hounding them? Selling that BMW?
I just never could wrap my brain around this nor understand it b/c I never got any raises.. so where was the money coming from?? Yes, banks, but, but, but that is NOT your money! How hard is that to understand??
(ps. I dont like loans or debts and spend/live accordingly, I guess I wont feel so much like an outcast anymore now that people have to go back to the sweet basics)
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June 14th, 2009 at 10:14 am 84
Strata fees aren't particularily high here for new, older, middle aged condos. Tells me except for the leakers they're not badly built, not perfect of course. I think Strata man is just a doom and gloomer who gets a kick out of trying to scare people. Hey Jesse, when people weigh out buying or renting it's like anything else in life, they just have to make what's called a "decision". One day you will grow up too.
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June 14th, 2009 at 10:17 am 85
Strataman: I have seen examples where the developer does a patch only for it to fail later. If an owner is not satisfied, they should notify their warranty. There is an extended 1 year Labour & Materials coverage extended on any repair by developer or warranty, fyi for owners.
The warranty periods are as follows:
2 Year – Labour & Materials – including HVAC, plumbing, electrical etc. (within this period a 12 and 15 month warranty are also defined).
5 Year – Water penetration (building envelope), some warranties extend this to 10 years.
10 Year – Structural, only on new buildings not renos.
On new developments the owners report all deficiencies to the developer and literally sign off on the repairs once satisfied with the repair. To me, this is a fair arrangement. When the developer fails, that's when the warranty comes in.
After the 2 year L&M expires, it's all on the warranty and people should be thankful. I've seen some pretty significant repairs happen within this period. I'm talking $100,000's to repair a building envelope, that would've been passed onto the owners through an assessment. You can't tell me this doesn't protect the owners, I've seen it in action. I've also been part of some huge leaky condo litigation so… I've seen what happens without a warranty, it's ugly and extremely costly and onerous on the owners. It may not be perfect, but it does protect owners from some pretty significant costs down the road.
Similar to a vehicle warranty if you start changing parts or taking your vehicle to a shady tree mechanic vs. the dealership where you bought it (while under warranty), your warranty is void.
A warranty is in place to ensure that things remain the same and functioning as they should. It's not a maintenance contract, contrary to popular belief. That responsibility remains with the owner of the property, as it should.
That being said, due diligence is always required but rarely undertaken. Research the developer/builder/warranty before you buy.
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June 14th, 2009 at 11:06 am 86
#79 strataman there is no 2-10-10 warranty anymore.
Only 2-5-10 I know as much as you do about this topic.
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June 14th, 2009 at 11:28 am 87
"#79 strataman there is no 2-10-10 warranty anymore." I don't recall saying there was? I deal with warranties over the last 15 years, did you know there are/were strata's with 5-10-20 year warranties? IE the 20 is still in force. Most of my work involves the expired two year warranty, that's why I have a thriving business. Personally the set up for me is great. Sorry but I'm not so much Gloom and Doom as amazed how people think Granit Counter tops is important but never question why major developers got rid of the % year warranty in the last 10 years.Would you now pay twice as much for a new car with 1/2 as much warranty? I'm more into quality, you know if your buying a car you would base it on the seat covers and paint job whereas I would check to see if it had an engine and transmission with a LONG warranty!
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June 14th, 2009 at 11:38 am 88
I was just reminded of something last night. Sellers who sell during a time of low interest rates will probably face interest rate penalties. If your mortgage is at 6% and the going rate is 4%, the bank will demand the penalty to make up for the loss in profits. This would cost sellers many tens of thousands of dollars. Some sellers will be shocked when this happens to them. Bye bye bubble bux.
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June 14th, 2009 at 12:14 pm 89
I'm amazed that some poor FTBs just cannot see the big picture. How dumb does one have to be not to realise that those artificially low mort rates that interrupted our housing plunge are toast.
Not only have the fundamentals not changed, but those freaky low rates have sucked in a whole new batch of greater fools that wont be around to affect future demand.
To think that the most overpriced real estate on the continent together with the worst global financial crisis most of us will ever see can be solved with a mere 15% correction is ludicrous.
Sure, some prequalified borrowers could send the market into one final frenzy in an effort to beat the clock, but that would only make the perfect storm a little more perfect.
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June 14th, 2009 at 12:18 pm 90
Gawd, I wish I had some more properties to sell!
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June 14th, 2009 at 12:51 pm 91
Is the housing bust about to take Manhattan?
http://www.reuters.com/article/ousivMolt/idUSTRE5…
And yet the magical land of Vancouver is never gonna drop, mind you it is the 'best place on earth'.
drop baby drop
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June 14th, 2009 at 1:18 pm 92
No longer looking good point about the sellers having to pay penalties. Does anyone know the penalty. I always believed it was 3 months interest. On garth turner's page he said it was all outstanding interest(I believe) that seems harsh.
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June 14th, 2009 at 1:46 pm 93
squeak: "Yes, banks, but, but, but that is NOT your money!"
It's somebody's money. Have any deposits at the bank? Where do you think those deposits end up?
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June 14th, 2009 at 2:41 pm 94
You boys and girls are still crying over real estate prices?
It ain`t going any lower, that`s for sure. I`m in South America right now and when I come back in 2 months, let`s see if anything has changed.
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June 14th, 2009 at 4:17 pm 95
Supraboy
Your mom's basement is not South America.
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June 15th, 2009 at 8:41 am 96
oneangryslav:
the preponderance of evidence points to there being much more risk than reward purchasing Vancouver real estate now.
You are not using the term "risk" correctly. Risk means uncertainty of earnings. The earnings from Vancouver RE, i.e. its rental value, are no more uncertain than they ever were. RE is far less risky than stocks (because corporate earnings are far more volatile than rents) which is why RE has historically returned much less than stocks.
Or to put it another way, risk means uncertainty in evaluating the fundamental value of an asset, which is the present value of what an asset will return to you if you never sell it. Fundamental value for RE is not hard to evaluate. It's just that the market price for Vancouver RE today is way above fundamental value, to which the market price must eventually revert.
Vancouver RE is not a risky investment right now. It's just a very bad investment.
If you buy Vancouver RE right now, you are going to lose money, big time, absent a greater fool who is willing to lose even more money. That's not a risk, that's a certainty.
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June 15th, 2009 at 11:04 am 97
patriotzed: You're right; I was using the phrasing of the person to whom I was responding. Risk does mean uncertainty, and there's an intuitively obvious relationship between risk and rate of return.
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June 15th, 2009 at 12:21 pm 98
Big news today: word on the street is that at least a quarter of the buyers at Quattro Phase 1 in Surrey are trying to walk away from presales. They all had 10% deposits.
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June 15th, 2009 at 12:24 pm 99
"ursus Says:
June 14th, 2009 at 12:14 pm
I’m amazed that some poor FTBs just cannot see the big picture. How dumb does one have to be not to realise that those artificially low mort rates that interrupted our housing plunge are toast."
I know several people like this who got sucked into the market in the last few months b/c of the low rates. Crazy.
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June 15th, 2009 at 12:26 pm 100
Soaring household debt threatens recovery: BoC
http://www.bnn.ca/news/10115.html
"But the risk posed by household balance sheets has grown, the Bank of Canada. The level of debt to income reached a record in the fourth quarter as real net worth dropped 6.7 percent from the same period a year ago, the central bank said.
While stressing that the possibility of a mass bankruptcy is remote, the ability of Canadians to repay their bank loans has replaced frozen credit markets as the main fear factor among policy makers, the report said.
"There has been a further deterioration in the financial position of the Canadian household sector as a result of the continued turmoil in financial markets, the deepening global recession, and worsening labour market conditions," the report said. "Nonetheless, in aggregate, the financial situation of Canadian households remains reasonably healthy."
Canadians' household debt is about 140 percent of disposable income, compared with about 150 percent in Britain and almost 170 percent in the United States. The level is about 90 percent among the countries that use the euro."
Yet, the cost to borrow remains… cheap.
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June 15th, 2009 at 12:32 pm 101
Patriotz what about the term risk when used in context of risk/reward. I think Angryslav was right also because that was his context.
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June 15th, 2009 at 1:25 pm 102
"You are not using the term “risk” correctly."
Risk means different things to different people in different contexts. No one likes a pedant.
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June 15th, 2009 at 3:00 pm 103
Leaky condo concerns cropping up in post-2000 condos
VANCOUVER (NEWS1130) – The man who led an earlier fight against Vancouver's leaky condos has a warning for owners of recently built condos: Just because it was built after the year 2000, doesn't mean it's free of the problem. James Balderson with the Coalition of Leaky Condo Owners says they've started to get reports from homeowners in condos built after 2000.
In many cases, balconies are needing to replaced, among other projects…but the existing warranties are running out. Balderson says the current leaky condo warning period that ranges between 1982 to 1999 isn't realistic. "I think the real warning period is for condos converted or built after 1970 to the present day. We're hearing reports about the warranties that are supposed to be looking after everything, and disputes are arising regarding the performance of the warranty companies who look after the problem."
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June 15th, 2009 at 6:39 pm 104
The cynical douchebags who fronted the little retarded boy into the mayors chair are striking quickly to cash in. They have just proposed changing the by laws to allow 205 sq ft condos to be built. Think of it, instead of 300 condos in a tower you get 600 on the same land. Quite a windfall for the douchebags. Who sees through this cash grab? Not the little retarded boy in the mayors chair, thats for sure. Instead of letting the market do it's work and bring the costs down, they instead propose another way to make it all seem more 'affordable'. You people better not think of having children or they'll be sleeping on top of the toilet tank.
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June 15th, 2009 at 6:45 pm 105
patriotzed:
Risk also refers to 'capital risk', not just an interuption of earnings. Capital risk can account for any potential exposure to loss from currency fluctuation, opportunity cost and direct loss through malfeasance etc etc.
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June 15th, 2009 at 10:59 pm 106
other ted:
Patriotz what about the term risk when used in context of risk/reward. I think Angryslav was right also because that was his context.
That was my context. The long-term total return of an asset class is positively correlated to its risk, because the more uncertain the returns, the more return rational investors will want.
Vancouver RE is no more risky today than it ever was. It's just ridiculously overpriced. That's something else entirely.
If anyone thinks I'm being pedantic, would you say it's "risky" to jump out of an airplane without a parachute? No, it's suicidal. Just like buying Vancouver RE at today's prices is financial suicide. Risk means undertaking an action with an uncertain outcome, not one with a virtual certainty of a negative outcome.
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June 15th, 2009 at 4:16 pm 107
[...] 15 June 2009 · No Comments Many suspect that ultra-low borrowing rates are continuing to levitate Vancouver’s RE market. This from a ‘horse’s mouth’, Anonymous on vancouvercondoinfo June 12th, 2009 at 7:09 pm – [...]
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June 15th, 2009 at 11:19 pm 108
Patriotz, that is a dumb post. Inflation might skyrocket, the government might sabatoge the bond market like the 70's, a lot of variables. Now might be a great time to buy real estate, no one can say with certainty. You've sure been wrong a lot of years, don't bother with any crystal balling.
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June 16th, 2009 at 3:38 am 109
Anonymous:
Now might be a great time to buy real estate, no one can say with certainty.
There is no credible scenario – whether inflationary, deflationary, or price stability, apart from selling to a greater fool – where buying Vancouver RE will give competitive returns to an investor.
You have the evidence of the world's biggest economy the other side of Zero Avenue. What more could anyone want?
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