Vancouver #1 in net worth

According to a study released by Environics Analytics, Our fair city surpassed Calgary in 2008 when it comes to net worth.  This is due to a number of factors, including increased household debt and rapidly dropping houseprices in Calgary compared to a slower drop in house prices here.

Net worth, which measures someone’s assets minus debts, dropped 6.2 per cent for Canadians as a whole last year. But Calgary residents saw their wealth plunge 12.3 per cent, while Vancouver’s residents were able to hang on to much of their riches. There, net worth fell just 3.1 per cent between December, 2007, and December, 2008.

Though house prices in both cities continue to drop, they are dropping faster in Calgary which makes the Vancouver numbers look better by comparison.  The report draws no connection between an economy based primarily on a real estate and it’s risk for a downturn in net worth, though it does mention the local obsession:

Vancouverite Sebastian Albrecht rode that Pacific wave. He has a lot of his money tied up in real estate. And it’s these investments – with prices down less than 10 per cent from their peak last year – that has made the city surrounded by mountains and ocean the richest in Canada, supplanting the country’s energy capital Calgary.

Mr. Albrecht bought his first condo a decade ago, after university. He stretched himself – and slept in a sleeping bag on the floor for a couple months in the unfurnished home.

A decade later, he lives in a $600,000 home that he bought two years ago for $500,000 and also owns – and rents out – a $350,000 town home and a $300,000 condo. He has some money in stocks, but only about 10 per cent of his net worth.

The three leading provinces for net worth also lead for household debt levels: BC, Alberta and Ontario.  Each province has it’s own particular challenges.  Alberta has a boom and bust economy based on energy prices, Ontario has been hit hard by a manufacturing downturn and locally we’ve seen job losses in resources, tourism and the entertainment industries.

As the recession and real estate market correction grinds on it will be interesting to see where the stats put us in a year as the report points out that it’s only current up until the end of 2008:

The survey doesn’t cover 2009. In the first six months of this year, prices for existing homes were down 8.6 per cent in Vancouver from the same period of last year, and 9.8 per cent in Calgary, resale statistics show.

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Noz
Noz
11 years ago

It's not me that's lowering Van prices…they are doing that all by themselves. It's you who are delusional. Vancouver is the same as any other market…only fools like you think otherwise.

As I have said already over THREE different times…either put your money where your driveling mouth is and go and BUY a place tomorrow…and I mean tomorrow…or just stop spewing bullshit Mr. Franco. Since you made so much money before, this should be a no-brainer for you right?

Personally I think you're just full of shit. I'm probably not alone in that assessment of you either.

Franco
Franco
11 years ago

Is there something wrong with your brain which alters your vision and cognitive perception Mr.Noz-Hello,anybody home?

Go out and take a look of those sold signs..Going down, not in your life time.

Hiding your head in the sand won't make Van RE collapse.

Vancouver is a different market. It's a losing game to stop a locomotive with your bare hands.

Noz
Noz
11 years ago

Either your really stupid or just playing stupid. Even while you spew out crap, the RE market in Vancouver is going down.

As I said, if unless you buy now, you're just full of shit.

Franco
Franco
11 years ago

Another bull crap drop on the floor caused by rage,desperation and shame from failure in RE forecasting. If Van RE receded over 25% in coming five yrs, I would eat your crap you just dropped,otherwise, you eat mine ok.

Bulls be humble and face the reality man.

The more of those idiotic doom statements posted,the more

would make a fool of yourself.The reason for selling my house,is personal preference to have capital for retirement.

Once you have pasted your prime,you need M to enjoy life,isn't it.I'm not like you bulls who have wasted M either in waiting or drinking beers,while moaning for being priced out forever.

Noz
Noz
11 years ago

Franco,

You shouldn't have sold…that's why your full of shit. You're a hypocrite at best.

Two ways to get rich…have no debt and save or load yourself up with debt like you did and hope for the best.

I'll choose the former.

Since you are not practicing what you preach, you're full shit.

Franco
Franco
11 years ago

Me,mouthful of shit??? NO,NO,NO bears are. anyone who listens to those idiotic bears since 2000,is in extreme agony and forever,regret because they wasted the opportunity to secure their future through Van RE,and instead,many of them lose all their saving in stock and financial scheme.There ain't no shit in my mouth but only handful of cash in my account. Though,I ain't rich but well enough to retire early,you? keep working to death to pay your monthly rent and grocery until retirement.

Vancouverguy
Vancouverguy
11 years ago

Well real estate in Vancouver will always be good, hey we have the best BC Bud in the world, that's how they are all buying them and they are so rich to afford a house, condo and townhouse! no single person in the right mind could afford a %700,000 home in this town.

Vancondobear
Vancondobear
11 years ago

Franco – what a ridiculous statement.

I am going to go to a stock market board and post that I sold my Nortel stock back in 2000 for $100 a share…and then tell others they are idiots for not buying or holding after I sold mine.

Ridic.

If this is the kind of well thought out logic that represents the bull mentality then I KNOW I am on right side as a bear.

Noz
Noz
11 years ago

So what you are saying is you got really lucky and now come to this forum acting as if you knew what you were doing.

I wonder why you sold in 2007 if it was such a good idea? Was it because you started sh7tting bricks and decided that you'd lose your shirt if you didn't sell?

People like you are a dime a dozen. It's like the charlatans of get rich quick schemes. Only after they make it big through lying, cheating, and getting lucky, they decide to write a book about how smart they really are.

What I suggest to you is to buy as many properties as you can RIGHT NOW in Vancouver with the enormous money you made. That will put your money where your mouth is. Otherwise you're full of it.

Franco
Franco
11 years ago

I bought my first house in 2001 and sold it in 2007 for a huge profit.What have u bear been doing since 2002, nothing but waning and complaining while being priced out from Vancouver forever.

Noz
Noz
11 years ago

Franco…

You better buy soon! Cause you know how Chinese salaries double every few years right? Everyone else's stays the same.

Van Man
Van Man
11 years ago

People with homes in Vancouver use them as ATM machines, either by re-leveraging them on stocks, bonds, new cars and more condos or lands. At least, that's what I'm getting from friends who do this. The guy in the article is doing no different than guys with dot.com stocks a decade earlier with people like Garth Turner selling Nortel and JDS Uniphase (remember them?!?) to the unsuspecting crowd, while advising them to tap into their home equity because homes will loose value. He's still selling the same old gig from a decade ago, though perhaps today, he's got a point. I do know of a couple who retired, but took his advise, lost almost all of their savings and is now living at minimal existence with low paying GICs and OAP. When we suggested that they should have some money… Read more »

Franco
Franco
11 years ago

The beautiful scenery,approximation to future and only world leader,China and dominant Chinese population will ensure Vancouver house price will double very 12 to 15 yrs.

Don't be a loser and priced out of Vancouver.

Arwen
Arwen
11 years ago

Thanks for the link, Mold City!

best place on meth
best place on meth
11 years ago

As far as creative ways of making money in Vancouver – I'll take grow-ops for $400, Alex.

Girlbear
Girlbear
11 years ago

Just returned from biz trip in both LA and SF. In both cities I came across people who said "oh, ya, Vancouver, it's ok but isn't it really expensive?".

This coming from people in two coastal cities not known for their cheap real estate!!

One gentleman thought not only expensive BUT expressed serious concern over extreme amount of rain. lol. He didn't sound like he was racing to invest here.

Oh, and hardly anyone knew we were hosting the Olympics. Nor did they seem overly interested in that particular tidbit of knowledge.

Boombust
Boombust
11 years ago

"…disgusted with the powers that be for allowing it to re-load and happpen again." No-lympics.

I think they will finally run out of bullets.

drugs "R"
drugs "R"
11 years ago

A twenty five year old man got shot and burned in his vehicle couple of nights ago two blocks away from my house in a quiet Burnaby neighborhood. It happened right next to an elementary school field, where children play and people take their dogs for a walk.

I bet creative ways of making money got him killed.

We are not that different here.

Not anymore.

Anonymous
Anonymous
11 years ago

"So what are others doing that I’m not?"

Selling crack comes to mind …

NO -LYMPICS
NO -LYMPICS
11 years ago

Pepperoni, SUV's , chianti and favre beans….

John;

The Titanic sailed on a very calm night.

No-one suspected anything til it was too late and "Unsinkable" ship was quickly history.

IMHO, last years Fall collapse did take many off guard.

However, I think many have learned from this recent history, yet the same ducks are lining up for a repeat, and many of us are fastening our seatbelts, and disgusted with the powers that be for allowing it to re-load and happpen again.

What some think is a short recession, a rebound and/or a recovery is underway, others interpret as delaying the inevitable .

john
john
11 years ago

I demand an apology from all of you bears here and now. You were all completely 100% WRONG. The crash did not occur and probably never will. You're all mini garths without the book deals. Meanwhile my peperoni business is BOOMING.

NO -LYMPICS
NO -LYMPICS
11 years ago

Negative Equity Nation for 1 out of 5 Homeowners: The Psychology of the 10 Million American Homeowners with Zero Equity. http://www.mybudget360.com/negative-equity-nation… Quote: Yet the losses are going to continue mounting as home prices continue to decline. Freddie Mac figures some 1 out of 5 homeowners with mortgages are underwater. Yet we know that there are still many more Alt-A loans that will have much higher default rates. Freddie Mac is probably as conservative of a portfolio as we will get. Here is some of the data on walking away: “(WSJ) The researchers found that homeowners start to default once their negative equity passes 10% of the home’s value. After that, they “walk away massively” after decreases of 15%. About 17% of households would default – even if they could pay the mortgage – when the equity shortfall hits 50% of… Read more »

mark downs
mark downs
11 years ago

jerry: There's a difference between moving cash temporarily into an asset with a guaranteed return and leveraging to buy an 'all or nothing' asset that isn't very liquid and has a high price for selling. My percentage in GICs now is more like 15%.

A leveraged investment in a house only has sales or rental value, this is less flexible than the stock market. Even though stocks have no guarantees, they at least have the advantage of being very liquid, with a very low cost of sale and highly divisible. I can sell half my shares of XXXcorp and use them to diversify into YYYcorp. With a house you can take a loan out on your equity, but that's not diversification, you can't actually liquidate half your equity at current market price.

Mold City
Mold City
11 years ago

Van Housing Bull: Those are just the same stats the MLS puts out at the months end, you can find those on any realtors blog.

AgentWill provides weekly stats on his blog that are more useful:
http://agentwill.com/weekly-stats/

Noz
Noz
11 years ago

STAGNATE: I'm not sure what "less elastic demand" means. The bottom line is regardless what immigrants are willing to pay, they have to be able to pay it. $500K is $500K. When the mean income is less than SF and LA, it makes no sense for home prices in BC to be as high. This leads me to believe that a lot of the wealth we see in BC is from the same types of shady sources that govern the wealth over here in LA and whatnot. I also believe BC is a bubble as well by the way. It simply doesn't make sense for all these people in BC to be able to afford $600-700-900K condos. Does it to you? What industry does BC have that allows people to afford such prices? Engineering? Doctors? Lawyers? What? I'm trying to… Read more »