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October 16th, 2009 at 10:51 pm
AH YES…….THE REAL ESTATE MARKET HAS “RETURNED TO NORMAL”. NEXT STOP: “FEAR – CAPITULATION – DESPAIR” (THE REWARD FOR THE GREEDY AND LAZY)
October 16th, 2009 at 10:31 pm
Dude look into a corporate bond ETF like Barclay’s High Yield bond ETF (JNK). It yields like 10%. I wouldn’t buy a GIC right now at all.
October 16th, 2009 at 10:22 pm
http://vancouvercondo.info/200.....ment-54556
Drachen,
More than a few years have past since you suggested to “wait a few years” for the correction.I have taken this and other opinions to heart and held off purchasing, but must admit I am becoming frustrated. Perhaps Vancouver is unlike anywhere else on the planet, where should I put my down payment savings, a 3%( if lucky) GIC? The probably over corrected stock market?
October 16th, 2009 at 10:02 pm
@Dave:
Sure, if you have a few hundred thousand dollars to spare why not?
Personally I’d rather have a nice retirement rather than living off a reverse mortgage on what little equity I’d have built up then being forced into living in an east side dump when that money ran out.
So… In essence, if you’re a millionaire and don’t care about anything under 7 figures, go ahead, buy now. But if you want that property for half off or less, wait a few years. Patience as they say is a virtue.
October 16th, 2009 at 9:53 pm
Ha ha ha exactly. READ MY LIP YOU MUTHERFUCKING BULLS : NO BAILOUTS FOR YOUR SMUG PIECES OF SHIT. You looked down on us renting savers for years and when the crap hits the fan you deserve to be in the soup lines.
“What type of mortgages are most new buyers taking?” « Vancouver Real Estate Anecdote Archive Says:
October 16th, 2009 at 9:33 pm
[...] October 2009 · Leave a Comment This in the trenches report on risk taking from Anonymous at vancouvercondo.info October 16th, 2009 at 4:36 pm [...]
October 16th, 2009 at 8:30 pm
@Salubrious Stan:
I work in that industry, I think you are confusing ING Canada Inc. the General Insurance Company, with ING Direct the online banking company. Before Feb 2009 they were all owned by the dutch conglomerate ING Group.
Not to say that ING Direct doesn’t have any problems, I’m not aware of any, but I have read that all our banks are in far worse positions then we’ve been led to believe. RBC being the worst.
ING Canada Inc. has now changed their name to INTACT. Irony, anyone?
Anyway, back to RE, 2 things to keep in mind: 1) Olympics and the post-Olympic dumping that is coming. I know it’s coming, it’s simply a matter of time. I think we’ll see some record breaking numbers of supply out there, remember hitting 18,000? I’m thinking double that by the spring 2010. 2) Interest rates are already rising on fixed mortgages. This indicates the banks are salivating at the notion of raising prime, and it’s coming. Again, just a matter of time.
Patience hungry bears… patience.
On a side note, I won’t buy in Vancouver unless a crash occurs and the provincial gov’t lifts that price freeze on property taxes from 2008. IF not, I will rent and most likely, move far, far from the best place on earth. LOL!
I can’t stop, lastly, for the bulls… if you’re so right about where prices are going, why are you so insecure about it? Gloating? I truly hope you realize any gains before you count those chickens. Capice?
October 16th, 2009 at 8:21 pm
Greg, why try to time the market? If you find something that works for you and something you can afford, then why worry about it? Here is a good article on that very topic
http://vancouvercondo.info/200.....e-yet.html
October 16th, 2009 at 8:09 pm
Don’t worry, we’ll all be donating our tax money to bail (err.. help restructure mortgages) for people who have fallen on “difficult” times. I mean, who could have foreseen not being able to make a mortgage payment @6% interest?!
Sadly, the irresponsible usually ride off the backs of those that have some sense of responsibility.
I do wonder though how many are locking in versue variable. Pricing adjusting to some form of reality might still be a few years away. It’s hard to time the market. The market will stay irrational a lot longer than most people can stay rational (as I’m sure many people here have experienced).
October 16th, 2009 at 7:32 pm
The link to my TD bank account (where the monthly deposits come from) is apparently “no longer active” despite no activity or change on my part.
Because of this I cannot expediently access my money as they cannot “prove my identity” despite having all available security codes until they receive and approve a voided cheque to re-establish the link.
This sudden need for ID is not in keeping with ING’s usual practices and enters a 1-2 week gap before the money starts to be transferred.
Add to this the wait for a service representative was an unusually long 15 mins, after being unable to complete the transaction as normal on the auto service.
The wife also called and was told she must jump through the same hoops to get her hands on her money, though I must add it is the link to the same joint account that has disappeared.
Ahh well, nothing tying me to ING which is the beauty of internet savings institutions – anyone any thoughts on PC?
Gotta do something with the vulture fund.
Moved this batch of money from Achieva after discovering that its deposit insurance was only backed by the credit unions of manitoba ???
As for the rumours, they stem from the parent company offloading ING canada at a steep loss earlier in the year, there was some speculation as to the insurance side of the business liable for losses on US CDS and CDO instruments, but I have been unable to find any more.
http://www.thestar.com/Business/article/582157
October 16th, 2009 at 7:06 pm
I just came to the conclusion that I don’t want interest rates to go up just yet.
I want to suck every last stupid motherfucker into the market until sales dry up completely.
Give me bidding wars, give me 20% over asking, give me $80K earners buying $800K houses, give me everyone taking out 35 year mortgages at variable rates.
When it’s all done, THEN I want to see interest rates go sky high.
ALOHA, SUCKERS!
October 16th, 2009 at 6:43 pm
http://www.bloomberg.com/apps/.....s0rpuaOw50
It’s stunning just how much prices can fall and also just how little a condo can cost in other markets. In Vancouver we become so used to lottery-win type prices being the average. Check out Fort Lauderdale…85k…and falling. Wow.
Over the past 12 months, condo prices fell 15 percent in the West Palm Beach-Boca Raton area to a median of $112,200, 36 percent in Fort Lauderdale to $85,100 and 31 percent in Miami to $144,700, according to Florida Association of Realtors data.
Those prices are likely to fall more when the $1 billion portfolio of South Florida condos financed by Corus Bankshares, the Chicago lender seized by federal regulators, goes on the market, Zalewski said.
October 16th, 2009 at 6:42 pm
@Salubrious Stan:
Do you mind elaborating on the ING subject a bit? What kind of rumours? Any link to credible source? TIA
October 16th, 2009 at 6:34 pm
no, you are just boring and off topic.
October 16th, 2009 at 6:30 pm
@Once again…:
Getting to you am I? Seeing me under the bed. Think that every negative comment you hear on the news and in the coffee shop is me following you around? Pally you the shakes for sure. Hey I don’t care if you want to hide under the bed, go ahead.
#32, D, if news reports from local, national and international organizations aren’t good enough for you then I can’t help you either. ALL the reports I have lodged have been DIRECTLY lifted from the reporters, justices and parties directly involved with the incedents. Trying to ‘vote’ me down is hardly an responsible response to the events that are taking place. What kind of an asshole are you (generally) if you can turn your head to incidents of insane violence against your neighbours?
If you found out that there were a few of these thugs in a particular neighbourhood would you buy a house there and want your children exposed to that trash? Do you want to live next door to the asstrash that murdered or beat or raped a person you saw on the TV or came to know through the media? Most normal people wouldn’t want to be in the same city as those ‘brave memebers’ who beat down the newspaper delivery guy.
What if you were South Asian and the guy who kicked and punched your neighbour while screaming ‘Fuck you raghead’, is this the king of guy who should be walking the trails behing your house. Shouldn’t we know that these savages are walking free?
If the truth bothers you so much then I actually feel sorry for you. It will certainly be a shock to you if it is one of your family memebers is murdered, beaten or savaged by someone you know will never face justice.
I love the goofy comments that there are ‘anti police sentiment’ in any of these comments. What should be happening is that the exposed criminals within the police departments should be taken out in chains and replaced by men who respect the law. We are witnessing the death of democracy in Canada and as Global TV reporters said tonight ‘ a broad range of people are excpressing grave concern’. If you aren’t concerned , well then, what happened to you?
October 16th, 2009 at 6:00 pm
37 Another RP post…
Dude, you are the ONLY one obsessed with the RCMP and police accountability. Give it a rest. Go post on a political blog, and ignore your mantra that EVERYTHING in the world is linked to real estate. How many times do you need your comments voted down????????
October 16th, 2009 at 5:49 pm
@Anonymous:
#35 – Or the price of pot will hit the skids as grow ops outnumber all other ‘business” in Van?
October 16th, 2009 at 4:36 pm
I spoke with my banker at Vancity in Richmond today. I asked “what type of mortgages are most new buyers taking.” She said without a doubt it was at least 95% “variable with the 5 year term” I said “quite risky”. She says no, because they can lock into a 5 year fixed at any time. This rate of course being double what they are paying now. Most current buyers only qualify @ the current 2.25% rate. If rates go up, I think all these current buyers will be broke.
October 16th, 2009 at 4:05 pm
Quick anecdote from the trenches:
Today, while I was waiting in line at the bank, a couple of gentlemen in their late 30s/early 40s were having a chat about real estate, only the last little bit of which I heard. Anyway, one of these geniuses gave the following advice to his interlocutor: “I you love the place, buy it! No discussion of mortgage rates, value, etc. Maybe he’s right–if the money’s there for the taking, why not tell the bank “thank you very much, and may I have some more to boot?”
Strange, strange, times.
October 16th, 2009 at 4:03 pm
Judging by RP’s rant, I think he got called out…
I really hope this chap is a teenager and not a grown adult banging away angrily at his keyboard. He sounds a lot like the next unibomber….
October 16th, 2009 at 3:52 pm
Realpaul, if you’re serious about having a point to get across you’ll do much better with a proof though logic rather than petty name calling. Such behaviour simply makes you look like you have nothing useful or important to say.
October 16th, 2009 at 2:34 pm
Thats the old WorldCom method for selling services to juice their revenue numbers. Selling bandwidth back and forth to other companies.
October 16th, 2009 at 2:20 pm
Owner A and B have houses C and D. Each is worth 600K. Owner A sells house C to owner B at a price of 700K. Owner B sells house D to owner A at a price of 700K. They repeat at a price of 800K, returning the houses to their original owners. But now it has been established in the market that house prices have risen and that the recent sale prices of houses C and D is 800K. FTB who are looking to get in now accept as fact from their realtors that houses in that neighbourhood are worth 800K because this is based on market sales history. Repeat with N houses and N owners.
October 16th, 2009 at 2:12 pm
Squeak is sensing a bad winter coming up..and will not transform into a spring.
I have been stashing away nuts and seeds for a long time now, laying low, in a stealth mode, big bulky belongings have been liquidized so can move at a moments notice, I am not interested in paying for others bad spending including olympics. My spending have been frugal as possible for a few years. I made a point out of looking like a poor scruffy squirrel, but I have a plan and dont others to make plans for my finances (ie “borrow” or begging)
Just watching the drunken pseudo hollywood stars continuing their denial, staying clear out of the way, just monitoring for the sake of my own survival.
I lived low on the totem pole for a reason, a good reason.
October 16th, 2009 at 1:45 pm
I’m wondering how much of this supposed bidding war at Main Street and Commercial Drive is actually baloney cooked up by real estate agents. Is anybody checking the facts on the transactions?
I walk by the “District” condo pre-sale office at Main and 7th twice a day. The District is at the supposed heart of the buying frenzy. It is as dead as a doornail. The only human activity is a bunch of sleazy looking agents milling about talking to each other and the occasional Chinese speculator dropping by to turn up their nose at the project.
October 16th, 2009 at 1:08 pm
#23, not sure i get this: They have conveniently forgotten the link to the account that sends them a monthly check for savings.
mind explaining further?
October 16th, 2009 at 12:22 pm
@Salubrious Stan: There’s plenty of good corporate bonds right now yielding 5% and above.
October 16th, 2009 at 11:54 am
Just got off the phone with ING, under no circumstances would they allow me to access my money expediently
They have conveniently forgotten the link to the account that sends them a monthly check for savings. I have been hearing rumours about ING’s solvency lately and do not want to have to wait for CDIC to get my substantial savings back?
Any recommendations for safe places to park my cash?
Need 3 banks minimum at the moment, with savings rates the way they are, I am just tempted to buy a modest quantity of gold and put in my deposit box with 10k in cash.
I am not a gold bug by any means, but that phone call frightened me.
October 16th, 2009 at 11:48 am
@ Starving Artist
I was in Seattle on Thanksgiving and coming back the lineup at the Nexus line was substantial. Perhaps it’s time for Super-Nexus for Really Special People.
October 16th, 2009 at 11:24 am
No matter what name RP puts behind his posts, his venom and extreme cynicism comes out. Hint – look for the postings on cop abuse stories, censorship, rants about democracy, the poor state of Vancouver, Canada, etc…
October 16th, 2009 at 11:15 am
Friday Free for all? Hardly. The active censorship on this blog is specifically designed to keep a few naive potential buyers on the hook until the advertising sucks up a new sucker. If you haven’t got that by now then , I have a nice bridge to sell. Anyone wants buy it? Huh Huh Huh?
Its a scam site.
October 16th, 2009 at 11:08 am
@mk-kids: “A 70% price plummet is so overdue…”
+1
heck, +10…
October 16th, 2009 at 11:03 am
Here’s another scenario that I think everyone is overlooking.
With the Canadian dollar near par, a large number of Canadians are going to do their holiday shopping across the border. I already know a bunch of people getting Nexus passes so they can shop more easily.
This could be a VERY painful holiday season for Canadian retailers.
October 16th, 2009 at 11:02 am
My friend owns one of those old overpriced places near commercial drive. She has just put it on the market (divorce). The realtor said she would list at $760K but wouldn’t entertain offers less than $840K. She bought 10 years ago for $309K and the house hasn’t needed much work over the years…
$309K for that house actually seems reasonable. $840K is kool-aid drinking self-induced psychosis money.
A 70% price plummet is so overdue…
October 16th, 2009 at 10:47 am
With regards to the couple purchasing a $750,000 home with their $8,000 credit.
From our friends Wikipedia:
FHA loans have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford.
This totally goes against what the FHA was originally set up for. Subsidizing blue-collar citizens so they can purchase 3/4 million dollar homes in a bankrupt state is idiocracy in its purest form.
Well done Feds.
October 16th, 2009 at 10:39 am
Any thoughts re the BOC having to raise rates despite the strong loonie?
I don’t think that such a move is out of the question.
Here are a few thoughts, FWIIW:
1. Part of the loonie strength MAY represent the currency market ALREADY pricing in coming rate increases. (In which case rising rates will not necessarily immediately strengthen the loonie further).
2. If we don’t raise rates, how are we going to service our debt? We need to attract buyers with competitive rates. Doesn’t Australia’s debt already look a lot more attractive to investors than ours?
3. It looks to me like the USD just may have put in a short-term or even intermediate term bottom at 75.2 yesterday, in which case a bounce in the dollar (with a concurrent pullback in stocks, gold, oil and loonie) would possibly offer a good backdrop for the BOC to tighten, or talk tightening.
4. Lastly, to consider again an analysis I recently mentioned that talked of how rising rates slow the economy (9 month lag) and thus actually end up WEAKENING the currency. And perhaps some aspects of the markets see that coming. The relationship between rates and currency strength is not a simple one.
October 16th, 2009 at 10:23 am
Regarding coming interest rate rises:
Volcker: Fed can’t wait too long for policy shift
15 Oct 2009, Reuters
Excerpt:
“You have to act against what seems like common sense. If you wait, it’s too late,” Volcker said.
October 16th, 2009 at 10:01 am
I have a feeling that this is the last of the bubble, wait until the new year when rates go up. The reporter who did the CBC news clip on the market in East Van seemed to be rolling her eyes when she said “Houses in East Van are going for a million these days” Yup, people are nuts and I’m hearing more and more of people running into problems with their mortgages because they never realized just how expensive it is to carry a mortgage of $500k+ on a rickety old house. Ooops! Oh well….suckers. We’ll buy on the way down. I can’t see this lasting, but I never thought it would last this long either. Then again, I have cash in the bank and all those FTBs have is a huge mortgage and value on paper. Guess who will come out ahead?
October 16th, 2009 at 9:53 am
Those old overpriced places near commercial drive, who is buying them? More FTB, that only care about the monthly payment right now? Did buy it with a huge 2.35% variable rate mortgage?
I had a friend who is a FTB buy a place in Maple Ridge, got a 300k mortgage @2.35% VR. When rates go up he’s going to be so screwed. Are sheeples just dumb, or is it just because their sheeples and the herd has lost its mind.
October 16th, 2009 at 9:40 am
HK government seeks to avoid another bubble after a record high apartment purchase.
http://english.ntdtv.com/ntdtv.....33449.html
In his annual policy address this week, Chief Executive Donald Tsang said the government was ready to reign in property prices.
[Donald Tsang, Cheif Executive]:
“The relatively small number of residential units completed and the record prices attained in certain transactions this year have caused concern about the supply of flats, difficulty in purchasing a home, and the possibility of a property bubble. The Government will closely monitor market changes in the coming months.”
The city’s last property bubble burst with the Asian financial crisis in the late 1990s, triggering a 70 percent plunge in apartment prices over six years that slammed the economy and local property owners.
No need to worry about Vancouver prices though, cuz we’re different.
October 16th, 2009 at 9:21 am
“lots of westside basements (kits, point grey, etc) go for 1500.”
Or, as in my case, entire houses go for $1500 on the west side.
October 16th, 2009 at 9:13 am
I’m starting to wonder if this flippin bubble will ever pop. Without high interest rates I don’t see it happening anymore, this city has lost the plot, I can’t believe the morons overbidding past last years peak prices.
October 16th, 2009 at 8:32 am
@Heinz Skitzvelvett:
Okay, here’s a second-hand but completely reliable anecdotal tidbit that sheds some light on the impulsivity driving the current Commercial/Main bidding frenzies mentioned above:
AFTER successfully winning a bidding war, one new-owner in that area told a colleague of the recent purchase:
Colleague: “How big is the lot?”
New owner: “I dunno”.
I KID YOU NOT.
(Needless to say, it was not a regular sized lot).
This stuff all smacks of the kind of thing you see in the last stages of a bubble, and the charts look like the top of the bull-trap/sucker rally.
October 16th, 2009 at 7:48 am
@Ulsterman:
Remember in the US you can lock in the interest rate for the entire amortization period of the mortgage. So if this couple can make the present payments, and don’t run into any contingencies like job loss or having to move (underwater house), they will probably be OK.
Without a doubt today’s stretched-to-the-limit buyers in Vancouver are getting a 5 year term at the most. They are lighting a time bomb with a long fuse. Sit back and wait for the blast. The ingredients are different, but we’re essentially creating the same exploding mortgages that the US did a few years back.
October 16th, 2009 at 6:44 am
I just listened to a report on CBC Radio 1 about housing prices in the Main Street and Commercial Drive areas.
One realtor interviewed had sold 2 homes for a combined $400,000 over ask, after 30 offers.
1910-style homes with 3 bedrooms on the same floor are the most desirable, and the benchmark in the Mt. Pleasant area is $40,000 over last year’s peak.
Which, to me, begs the question:
How short are people’s memories? Honestly. I’d love to live in a fantasy world where prices went up forever, and where I could borrow seemingly endless amounts of cheap money, and I’d love to believe that no matter when I purchased a home, it would appreciate ad infinitum untilI sold.
But a bubble and a bust fueled by loose monetary policy has been followed by a fix of looser monetary policy. The cure seems worse than the disease to me.
Take a guess how this one turns out.
October 16th, 2009 at 1:30 am
Domus,
Yes, they are trying to inflate another bubble because, as in your second question, there is no economic development without overprice RE. Well, there is always the marijuana industry.
October 15th, 2009 at 10:55 pm
somebody wake me up, this is a joke gone bad.
The article about the Bank of Canada having a balancing act between booming house prices and needs of the Eastern industrial belt is the climax: are they willingly inflating yet another RE bubble? Is there no economic development without overpriced RE?
October 15th, 2009 at 10:49 pm
“[However] by the time we get into the new year, (Cameron Muir, chief economist for the B.C. Real Estate Association, said in an interview) home sales in [Metro Vancouver] will start to ebb and reflect more the underlying fundamentals of the economy around wage growth, job growth, that kind of thing.”
Yeah. “..that kind of thing.” The ‘kind of thing’ that Cameron Muir and all the other RE pumpers have ignored for the last 5 years or so.
“Wage growth, job growth, rent/price ratios, income/price ratios, yada, yada, yada…”
October 15th, 2009 at 10:39 pm
I just love the CNN story about Noel Delisle and Mike Spence buying the 750,000 house. Mmmmmm, i thought – look at that smiling yuppie couple living just outside SF. Bet they’re Lawyers, dentists, or finance types given how much they can afford. But no. Noel is a hairdresser and Mike operates a crane. No, not a scalpel…a crane. That’s right, good ole working plebs who feel like it is a good idea to buy a 750k mortgage when interest rates are as low as they’ve ever been.
To add to the stupidity, Mike admits:
“The $8,000 tax credit is saving us. Wedding, new house, we’re tapped out.”
Tapped out. Yep, that’s right, smiling, party-people Noel and Mike are well prepared for unforeseen financial events.
October 15th, 2009 at 10:11 pm
First