2009 Farewell Free-for-all!
Well, well.. what a year it was. Canadian house prices took a leap from a shallow recessionary dip fueled by dirt cheap interest rates, financial stimulus and speculation. Now instead of ‘bubble talk’ about the Vancouver market, we hear the federal government making some fuss about the potential of a national housing bubble – even in places where house prices aren’t 10x the local income. Here’s the last open topic posting for 2009, but the first for 2010. Hope you all have a great year!
-Time for Canada to take away the housing punchbowl
-How big a mortgage can you carry?
-Its different in Seattle
-Nice home, wheres the rest of it?
-From Boom to Bust, how Ireland did the noughties
-USA: 10 years, no gain in house prices
-Renters win as vacancy rates rise
-Chinese RE bubble may lead to US style slump
-Five bubbles set to burst in 2010
So what are you seeing out there? Any predictions for the new year? Resolutions? Post your thoughts, news links and anecdotes here and have a great weekend and an excellent new year!
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January 1st, 2010 at 12:53 am
Already the new year here. Happy new year. Good riddance to 2009. The five bubbles to burst in 2010 article was interesting and it got me thinking. This year was the one that summed up the decade. We knew the economy was fake and the printing of money fueled massive bubbles in real estate and possibly comodities. and in 2008 we learned how precarious our situation was, but what happened in 2009. How on earth did they manage to fool people into believing everything was fine again. Maybe I am looking at things through the prism of canadian real estate and the tsx. But I would have to say this was the year where nothing seemed to be real. The markets, the news reporting we are out of the recession. I would call this the worst year of the decade as there was no excuse. After 2008 there should be no one left who should be saying we coudln’t see this coming. But sadly 2010 I believe is the year we will hear the phrase “no one saw this coming the most”
Happy new year
January 1st, 2010 at 10:23 am
Art and RE?
We’ve thus far seen Bob Rennie’s installation of Martin Creed’s “EVERYTHING IS GOING TO BE ALRIGHT” on an office building in Gastown possibly miss the mark.
Now comes a DIRECT HIT from artist Reece Terris, whose work ‘The Western Front Front – Another False Front’ subversively comments on the Vancouver RE Bubble, and wittily uses Construction as its medium.
For images and discussion:
http://tinyurl.com/ykrm7ve
January 1st, 2010 at 11:57 am
from the Seattle article:
“Oversupply of rentals
Insiders expect even fewer new starts in 2010. More than 5,000 new apartments were completed in King, Snohomish and Pierce counties this year, Gardner said, “so there’s going to be an oversupply.”
And when the market does recover, he added, landlords will meet any demand for new condos by converting apartment buildings. “We are not building any more condos. Period.”
……….
Jim DeLisle, a University of Washington professor of real-estate studies, said he fears a 40 to 60 percent drop in commercial real-estate values from their 2007 peaks.
…………
Still, the big picture is less than rosy. Gardner, the economist, said most of his work a few years ago was for developers exploring the feasibility of potential projects.
Now, he said, his clients are mostly lawyers and banks, looking for ways to salvage financially troubled properties: “We haven’t done any feasibility work in a year.”
Commercial real estate won’t recover until after the rest of the economy does, insiders agree. “We need jobs to get this thing moving again,” said Opus Northwest’s Parsons.
King and Snohomish counties have lost nearly 100,000 jobs since employment peaked in early 2008. It would take at least 36,000 new ones just to fill 90 percent of Seattle’s vacant office space, Parsons estimates — and the city accounts for only half the region’s vacant space.
………
But he doesn’t expect commercial real estate will return to anything approaching normal until 2014.
The outlook has dimmed considerably since early 2008, when the recession hadn’t hit Seattle hard yet. Many insisted then that Seattle’s real-estate market would piggyback on a strong local economy and escape the downturn relatively unscathed.
“About a year and a half ago, we thought we were different,” DeLisle told one recent forum. “Nobody is really different.”"
“Nobody is really different.”
“Nobody is really different.”
“Nobody is really different.”
“Nobody is really different.”
January 1st, 2010 at 12:03 pm
That’s one artistic statement and visual impact from our local artist. I’ll be down there soon to snap photos.
Happy New Year to The Pope and all. And thanks for letting me vent here once in a while to keep my sanity going.
January 1st, 2010 at 12:57 pm
Happy New Year All!
Here’s to a future that includes sensible property values and a life lesson to speculators about putting all your eggs in one basket.
..until the next bubble comes along.
January 1st, 2010 at 2:54 pm
Happy new year you scum sucking renters!!!!!!! I hope 2010 brings continued misery as you watch from the sidelines in your crappy rental! Maybe this year you’ll finally come to grips with your financial situation.
January 1st, 2010 at 3:14 pm
COWARD-RichAsian,
2010 will be the year where your Real Estate Agent Card will be your demise, as you run out of greater fools.
The lease on the Mercedes will force you to provide ramen to your gold digger wife, who will dump you for a man with a visible organ.
Keep us updated, someone here may have a job for you, for 8 bucks an hour.
Best regards,
arit
January 1st, 2010 at 3:53 pm
richasian? Unlikely. Little dogs bark when they’re terrified.
January 1st, 2010 at 4:08 pm
Richasian,
“Maybe this year you’ll finally come to grips with your financial situation.”
My financial situation is just fine, thank you. I have cash in the bank, which is a whole lot more than I can say for my friends who recently purchased homes. What do they have, oh right, a mountain of mortgage debt, as well as credit card debt from being suckered into furnishing the new house. And if interest rates go up as they’re predicted to, they’re screwed.
Thanks for being so concerned though!
January 1st, 2010 at 5:08 pm
Watch world cities celebrated 2010 New Year
http://www.youtube.com/watch?v.....r_embedded
http://www.youtube.com/watch?v=bIn3qg-6R-k
Last night I heard faint isolated fire crackers in my hood or was that ‘richasian’ taking out a druglord in a disputed territory.
January 1st, 2010 at 6:43 pm
@Anonymous: Thanks for the video, anon. Why can’t we have any fun in the greatest place on earth????
Here I am still dealing with idiotic landlords waiting for the bust.
After the O limp ics are finished, who will bet that the msm will start chanting — just wait everyone — they are going to come — they are just packing up there things — and the nonsense will drag on….
Happy New Year Everyone!! I hope you hang in there during 2010 when the curtain is finally drawn on this charade. Hopefully you’ll still have a sack of cash and laugh your way to prosperity — if only you can hang on to your jobs!
Thanks again Pope!
January 1st, 2010 at 7:19 pm
Hey richasian,
Your empty and ignorant comments fall on deaf ears.
I can tell you this. I’m not asian, have no university degree, never had family hand me money, am in the top 1 percent individual income earners in the country, under 40, work 9 to 5, maxed out on RRSP, enough savings to retire and buy a condo on. Oh yeah, I rent also.
The point here is not who can afford to own, but rather who has the intelligence not to. Apparently we all know which category you fall in.
January 1st, 2010 at 7:26 pm
Hey RichAsian
Thanks dude, I did in fact come to terms with my financial situation. I realized costs are too high and salaries are too low in Vancouver, so I moved somewhere much, much better.
For those of you who are following my adventures, last night was amazing. I had some friends over for a great four course deal…. everything was organic and locally grown. Then we went over to another friend’s house and stayed up till 5 AM having drinks and hanging out. There’s nothing like a good ol’ fashioned Nova Scotia house party!
The best part is my friends and I can all afford large, detached placed here in Halifax, so I didn’t have to deal with any drunken douchebags in elevators or paper thin walls.
As I was walking home I admired the gorgeous blue moon and thought to myself that I would probably not have a chance to see it in Vancouver thanks to the fog and rain.
I find to my great surprise I like winters WAY better here! I like watching the snow outside the window. It’s colder but not nearly as damp. It’s far more pleasant. Who would have thought?
January 1st, 2010 at 9:47 pm
“Falling home prices appear to be behind us”
http://www.vancouversun.com/bu.....story.html
To anyone who wants to own property but can’t stomach being half a million in debt – time to move.
January 1st, 2010 at 9:58 pm
Actually I had very nice New Year celebration for the first time in the last 15 years. This year I have celebrated my first New Year in my new city, Regina. New Year Eve bash started with two sets of hockey games (Fin-Swe, CZE-Rus) at the World Junior’s. Packed arena and superb quality of games – priceless. And cost – just $20 a ticket.
After the games there was New Year’s party in the next-door Exhibition Center.
Two Music Bands, lot’s of friendly people, reasonably priced drinks…fantastic feeling. I have not experienced that fuzzy New Year feeling for 15 years in Vancouver. Vancouver is totally impotent in regards to any public celebrations.
Yes it is very cold here (-26 C today) but Prairie people have very warm hearts. And you just get used it to the cold.
January 1st, 2010 at 10:10 pm
Has anyone checked the current BC Assessment?
Several people report that the assessed values in their streets have dropped.
January 1st, 2010 at 10:42 pm
@rp: Thanks for the link RP, but I need help with this:
.
Helmut Pastrick is saying that housing markets are traditionally one of the first sectors to recover after a downturn? Seriously?!?
Shouldn’t the Chief Economist of Central 1 Credit Union know that housing markets are often one of the LAST sectors of the economy to recover?
WTF? Even here in Vancouver, when house prices crashed in 1981, they didn’t start to appreciably rise until 1988 and it TOOK MORE THAN 20 YEARS for real prices to break even with the previous peak. Compare that to the TSX – it bottomed in 1982 and by 1988 it had doubled from the trough.
Look I understand how Joe-Blow doesn’t understand this stuff, they see low rates and hear that ‘real estate never goes down’ (despite all the real world examples to the contrary), but an ECONOMIST?!?
They should know better.
January 1st, 2010 at 11:18 pm
The funny thing about the Dublin bust is that it went bust even though Dublin had huge immigration levels (everyone wants to live here argument) and it had lots of well-paid jobs (you know, those things Vancouver has virtually none of) provided by large American and Japanese companies using the country as their European foothold/base.
Clearly those silly Irish didn’t “will” prices higher by thinking positively and focusing on their Specialness.
January 1st, 2010 at 11:37 pm
#17 @Wreckonomics: Residential investment (new home construction) is one of the first things to recover. See
http://www.calculatedriskblog......order.html
Home prices are typically another matter entirely.
January 2nd, 2010 at 12:22 am
@rp: Yes, but he’s talking specifically about home sales or else the reporter got it completely wrong and is misquoting him.
January 2nd, 2010 at 1:21 am
@arit:
How big are you? By the way, Richasian is a white dude.
January 2nd, 2010 at 2:04 am
Anonymous,
1. “How big?”: in height, organ-size or mental-maturity? Respectively: Average, above average, below average.
2. “Richasian is a white dude”: This tells me that you, anonymous, are a very nice person who, like most other nice people, tend to think other people are nice also.
Your rational is “He is a white guy trying to give a bad name to Asians”. I wish you were right, but you are not. He is actually a Canadian born Asian. You are welcome to prove me that he is white using facts, but not with politically correct logic as I do not subscribe to political correctness. I am also below average nice.
Best regards
arit
January 2nd, 2010 at 3:04 am
@#21 – I’m sure ‘richasian’ is who he says he is
Buy Land, Sleep, Wake Up, and Make Money
http://www.chinastakes.com/200.....money.html
If you’re searching for examples, look no further than jimtan and thompson
January 2nd, 2010 at 5:53 am
#20 @Wreckonomics: I don’t have any data to back this up, but I think a moderate uptick in sales could lead a recovery. Developers would see that and start increasing new construction. Or the price of materials and labour could drop so that new homes are much cheaper to build. Or both.
That hardly happened in Vancouver though. Prices are so far out of whack that the only thing that matters now is the interest rate. We’re in total bubble territory. It’s not logical for people to take out mortgages they can barely afford, when the average rate over their term is expected to be much higher. That’s not a calculated risk, it’s foolish, like betting the next three coin flips all come up heads.
January 2nd, 2010 at 10:42 am
Now that BC Assessment is up I can see how much my friends paid for their houses. All I can say is…WTF?? It’s astonishing, where did they get the money to buy these houses?? Did they win the lottery and not tell anyone?
Oh never mind, it’s just the good old CMHC windfall-free money for all!
January 2nd, 2010 at 10:57 am
I wonder when the municipalities will start going after “landlords” with rental suites in their single family homes? A friend that teaches in Surrey at a brand new school (just opened its doors) says there is already 4 portables because the city didn’t realize just how many rentals were in the area. It would seem like a politically unpopular move, but if the city needs to raise taxes everyone would complain about that vs. raising taxes on the individuals out there that are already abusing the system. I can’t tell you how many homes I see on MLS/craigslist that say illegal/unauthorized suite right in the description. Maybe we can help speed up the correction by reporting them?
January 2nd, 2010 at 12:43 pm
I don’t know about you guys, but I get a real sense the reckoning is coming. The first domino to fall will be Flaherty’s curtailing of mortgages. I’m personally hoping for a 25/15, but realistically I suspect he’ll go for a 30/10. Good enough. Next domino will be BoC moving us away from the zero bound. It’s horrible to think about so many young couples starting their financial lives wiped out, but years of patience will finally start being rewarded for the prudent.
Having lived on the prairies and in the maritimes, I can agree with the commenters above. Those were great times, and you both sound very happy. For me, for better or worse, Vancouver is where my heart belongs. If the dominos somehow magically don’t fall, I guess I just will be priced out forever. C’est la vie. I’ll just figure out how to factor a lifetime of renting into my financial plan. I’m probably an oddball, but the ownership premium doesn’t have much salience for me.
And Richasian, dude, don’t be hatin’.
January 2nd, 2010 at 1:03 pm
Hear ye girls and boys,, I’ll give you some leads of Vancouver real estate in 2010.
These condo buyers lining up in Hanzhou are flying in to Vancouver by the plane loads n now that ADS treaty is signed between China and Canada.
http://news.backchina.com/2009.....67033.html
http://news.backchina.com/2009.....66800.html
Ming Pao’s most important news on the first of January, 2010
Lai Chang-xing declares 2010 a boom year for Vancouver real estate
http://www.mingpaovan.com/htm/...../vaa1h.htm
January 2nd, 2010 at 4:51 pm
Don’t worry about posters like rich asian.
I suspect rich asian is not really asian. Asians are generally modest and respectful people, rich asian sounds like a redneck who somehow fell into a fortune.
Karma does exist and if you lead your life by insulting and being disrespectful to others, life will get you back one day.
January 2nd, 2010 at 5:02 pm
Buy now or be priced out forever, as Vancouver prices are now “wealth based”. Where does wealth come from? Why real estate of course
http://www.vancouversun.com/sp.....story.html
January 2nd, 2010 at 5:27 pm
“As the city continues to mature into its world-class role, increasingly desirable to prospective residents from all continents, home ownership and rental will become less affordable, especially in the urban core. Local real estatewilllikelybeincreasinglywealth driven, as opposed to income driven.”
———-
OMG. Does he really believe the crap that he writes?
January 2nd, 2010 at 6:04 pm
Just keep repeating it over and over again renters. There’s no place like home there’s no place like home. Then put your fingers in your ears and say na na na na when everyone is saying that real estate only goes up. Continue to drown your sorrow in the pubs downtown you sick little losers. Meanwhile I cash your rent cheque and head to Vegas for some gambling. It’s fun being a winner. How is it being a loser… bears?
January 2nd, 2010 at 7:07 pm
@joycer:
You know, instead of forcing illegal suites underground maybe some cities could loosen up the rules a bit. Landlords get responsibilities (and rights) and so do Tenants! Even a bit more tax revenue to pay for more even enforcement.
January 2nd, 2010 at 7:29 pm
@Meat Robot:
Take heart, there’s nice stuff out there that’s not frozen….
http://www.bubbleinfo.com/2009/12/30/chevy-tv/
January 2nd, 2010 at 8:44 pm
There’s the crack, it’s high quality…and oh, the pipes are over there. Addictive? Of course it is! I know you can stop as soon as you’ve had too much. I’ve laid it out here for your utmost convenience, and by the way, please don’t use too much of it.
January 2nd, 2010 at 10:49 pm
@rp: Wow. What other industries get to write ads as articles? And what was with all the runtogetherstringsofwords?
January 3rd, 2010 at 12:30 am
I was in metrotown today, there seems to be a big flood of Iranians, Arabs and Australians in town. I haven’t been there in ages. Today, I’ve seen reality at work as the influx of immigrants are here to stay. These aren’t your typical working class immigrants, they came into the mall in droves and walked out with a handful of new clothes and whatever they can get their hands on.
If you feel like voting this down, you are the one in denial. Just go to the damn mall yourselves and find out. Don’t listen to that “I live in a box ‘scullboy’” spew his nonsense. Now he’s in halifax and realized that he’s also priced out over there. Welcome to 2010 boys and girls.
January 3rd, 2010 at 12:37 am
there seems to be a big flood of Iranians, Arabs and Australians in town. I made plenty monies blowing them all.
January 3rd, 2010 at 12:38 am
Gosh Supra, did you drive your BMW or your Ferrari to the mall?
January 3rd, 2010 at 1:33 am
so many suckers out there, its unbelievable ..
suckers born every minute is true…
January 3rd, 2010 at 8:38 am
@Mold City:
“Wow. What other industries get to write ads as articles?”
All of them. If you pay enough for advertising the papers will happily accept your news release as a contribution to their fine publication… Smaller TV news shows will do the same for you if you know the right people to ask too (I presume radio as well but I don’t have any direct experience there). And of course very small newspapers are just happy to have free material to fill the pages so they don’t look too closely at bias and such, you don’t even have to pay them (in the form of advertising in their rag) to get your “story” published.
I’d say it’s a sign of the times, newspapers being forced out by internet and such but it’s been going on for decades.
January 3rd, 2010 at 10:34 am
@Meat Robot:
Wiped out from what? The 20somethings with their 0/40′s and 5/35′s put SFA on the table and will lose little. They will file for bankruptcy, keep whatever pension assets they have, won’t be able to borrow for 7 years (which is a good thing, not a bad thing) and should be set to get back into the market at reasonable prices when they are able to get a mortgage again.
The people who are really going to get hosed are the boomers who cosigned for their kids, or bought investment properties believing that this would give them the life of the rich and famous after retirement. They will never be able to recover and are likely to have to sell their own houses which they bought back in the 80′s at reasonable prices. Which BTW is one of the reasons I don’t see any recovery from the upcoming bust within a generation.
“Welcome to Wal-Mart”.
January 3rd, 2010 at 10:38 am
@doug r, I do sometimes look south and sigh. But I also take a perverse Canadian pride in being able to endure cold winters.
It would be quite a sight if Vancouver started getting door-crasher type prices on large, terraced properties with outdoor pools and water views. Not quite that crazy a fate for us, I imagine, but a guy’s gotta dream.
Since when did seeing people buy stuff at the mall constitute evidence of anything other than the mere existence of consumption in a non-specific sense?
January 3rd, 2010 at 11:14 am
Well what do you know, I think Bernanke is finally saying something worth listening to. Better late than never:
http://www.theglobeandmail.com.....le1417433/
And I agree – IMHO the key to the housing bubble in the US in the previous decade – and the Canadian bubble which continues today – was not low interest rates on guaranteed debt (i.e. deposits, Treasuries) in themselves but the detachment of risk from mortgage lending which lead to mortgage rates which were out of whack with the actual risk of default.
As for “dubious mortgage practices”, how about qualifying people for payments based on today’s interest rates which everyone knows are going up, soon? Or accepting levels of down payments which are virtually certain to leave buyers underwater in the near future? Are you listening, Mr. Flaherty?
January 3rd, 2010 at 11:30 am
A nice recap on “What is a Bubble” by Irvine Housing Blog:
http://tinyurl.com/yzzgx8t
He hits on all the usual arguments as they relate to Irvine, California, and it sure sounds familiar. My favorite excerpt:
“Of course, since housing markets are dominated by amateurs, a robust price analysis is unnecessary. [xiii] Even a ridiculous analysis, if aggressively promoted by the self-serving real estate community, provides enough emotional support to prompt the general public into buying. There is no real fundamental analysis done by the average homebuyer because so few understand the fundamental valuation of real property. Even simple concepts like comparative rental rates are ignored by bubble buyers, particularly when prices are rising dramatically and such valuation techniques look out-of-touch with the market.”
January 3rd, 2010 at 11:36 am
http://www.nytimes.com/2010/01.....al.html?hp
January 3rd, 2010 at 11:47 am
I want the teranet index to confirm it, but it sure looks like we’ve taken out the previous top:
http://www.yattermatters.com/r.....cember-09/
If that’s the case we’re in for one heck of a show, but most bubbles are symmetric in time. Could the declines drag out for a decade?! I might want to leave even if there is a crash this spring. As per #33, there are some very nice places in Southern California right now. 550k for a 4000sf mansion on 8 acres on the top of a hill?
January 3rd, 2010 at 1:20 pm
Rich asians have small penises. That is why all asian women want to marry a white guy.
January 3rd, 2010 at 1:23 pm
Feeding trolls just gives them what they want.
January 3rd, 2010 at 2:14 pm
“Both lenders and borrowers became convinced that house prices would only go up,” Bernanke said. “Borrowers chose, and were extended, mortgages that they could not be expected to service in the longer term. They were provided these loans on the expectation that accumulating home equity would soon allow refinancing into more sustainable mortgages. For a time, rising house prices became a self-fulfilling prophecy, but ultimately, further appreciation could not be sustained and house prices collapsed.”
http://www.marketwatch.com/sto.....2010-01-03
It’s only a matter of time.
Gravity always asserts itself, even if the Vancouver Sun says it’s different here.
January 3rd, 2010 at 2:26 pm
lenders made home loans to people to finance houses they couldn’t afford.
This is a very interesting statement that had a very deep dark effect on the US housing market. Then of course sub-prime and the liar loans and reseting mortgages.
That same thing has been happening here, all the same. When the mortgage rates increase we will have the same problem here but unfortunately we can’t just mail our keys to the lender those people will have to pay for their stupidity.
If the price seems too much it is. It’s not rocket science it just common sense.
January 3rd, 2010 at 2:56 pm
@patriotzed:
Bingo. The big problem in the US came when banks started to realize how long it was going to take to liquidate the assets they acquired in foreclosure. In Canada there has been nary a whiff of substantially increased foreclosure levels. Until that happens, even if people start missing payments, the bank in theory makes their money eventually, with back interest, and they are capitalized well enough to wait it out. It is very hard to convince a boardroom that these loans are anything but “can’t lose” in the long run.
January 3rd, 2010 at 4:27 pm
If you are not angry, you should be angry. The market in Canada is nothing short of an outright manipulative attempt to prop up an economy using Real Estate as the tool. The government has made a mandate to flood the market with Cheap and easy CMHC financing to try to stimulate a faltering economy. This is their way of making themselves and their policies look good!! This has hurt those that actually have savings and are cost conscious and has pandered to those that have none or very little savings and who could care less about the long term costs of taking on mortgages as such ridiculous levels. It has pandered to Realtors, house flippers and has hurt those who actually used to believe that like the last 50 years, if you saved hard you would be rewarded with a nice place to live with minimal debt.
The government has become reckless and unlike the US subprime, this mortgage debt is being carried by us, the tax payers. Allot of us have money and savings. Savings that we have worked hard for hoping to purchase affordable housing only to see this dream hijacked by those playing Real Estate like their own little casino and by governments that do not care about affordability, but only care about their standing in the polls.
I say it is time to hit back and let them know we are hitting back. We have savings and we have money and the government needs to know that if they do not want us to start going on spending strikes, they need to stop manipulating the housing market. It’s time to start writing your politicians and telling them how angry you are. Enough is enough, if we don’t start standing up, these people will begin rolling out generational mortgages and the same garbage that the Japanese did to put a bandaid on their once skyrocketing Real Estate prices.
The bottom will inevitably fall out, the only problem is how long and how much more manipulation will take place while we wait and listen to the Realtors and Real Estate speculators banging their chests and boasting how prices are going higher and higher every month.
It is truly sickening how something that is a staple and vital, that being housing has become the latest get rich quick scheme in the minds of so many people.
I have sent e-mails to my politicians expressing my anger over what is nothing short of housing manipulation. It is time for everyone to get involved. Let them know, specifically Jim Flaherty that we are fed up with what is transpiring in this country. It is one thing having banks being the enablers, it is another when the government is doing it using OUR money!!!!.
Start flooding our politicians with angry e-mails. Get everyone you know who wants to buy but does not want to pay these very inflated manipulated prices to do the same. As I said before, it is one thing if the banks are doing this, it is a completely different matter when the government is using our own tax payer money through the CMHC to fund this housing fiasco. If you do not write and do not get involved, you have no reason to complain.
Here is our own made in Canada subprime mess:
http://www.rabble.ca/news/2009.....-time-bomb
Jim Flaherty – jflaherty@fin.gc.ca
Stephen Harper – pm@pm.gc.ca
January 3rd, 2010 at 5:05 pm
My feeling is that the correction will happen for different but related reasons here in Canada. Instead of being first precipitated by defaults, I think the buyer’s pool is simply going to dry up (by way of increased interest rates/second dip economic malaise/prices hitting new monthly cash flow viability cut off points). Defaults and foreclosures will come as secondary effects as the RE market takes a tumble. Here in Vancouver, we could get some defaults first as rental condos go empty for want of tenants after the olympics.
The only way to keep things going is to double up on the ponzi scheme and loosen lending standards even more, but it seems that the opposite trend is in the air due to the very real possibility that we will in fact get a US style crash if we keep on the current trajectory.
One thing I also suspect is that many of credit unions here may go belly up. No hard evidence except that their mortgage rates are extremely low in some cases.
January 3rd, 2010 at 7:37 pm
Japan Return to ’91 GDP Gives Markets Mega Risk Crisis
“Japan’s fiscal conditions are close to a melting point,” said Takeshi Fujimaki, a former adviser to billionaire investor George Soros and now president of Fujimaki Japan, an investment advising company in Tokyo. “My biggest concern is whether the Japanese government will be able to sell all the bonds at auctions,” he said, adding that such failures might send 10-year note yields climbing through 2.4 percent.
January 3rd, 2010 at 7:58 pm
“Alot of people are going to be kicking themselves for not buying in this market”
“Visit remax.ca”
Just saw this ad on Global’s 6:00 news.
Real Estate ethics – oxy-MORON
That’s all I got to say about that.
FORREST
January 3rd, 2010 at 8:15 pm
Mark Carney gets the “MORON OF THE YEAR AWARD”
“We will make money free to borrow,but don’t borrow any because that may be foolish.”
January 3rd, 2010 at 8:16 pm
Supraboy: The Arabs you refer to are here for some type of competition / conference i believe. I was at the Roxy on New Years and the place was full (40+) of young Arab men wearing team United Arab Emirates jackets. So, i suspect they are not (as you seem to believe) new immigrants, and more likely here for a short time. I doubt they all bought condo’s while they were here.
January 3rd, 2010 at 8:36 pm
Patriotzed, i too read that article in the NYT. Given that the places are so cheap, i have toyed with the idea of buying one as a possible retirement option.
I don’t foresee ever buying and paying off a SFH here in Burnaby before retirement and i like the idea of having a place where it’s warm and sunny.
I realise that there are property mgt fees, exchange risks, tax issues to deal with. Is there some enormous flaw in my logic that i’m missing?
I lived in Florida for 6 months a decade ago and quite liked certain areas.
Bloggers, any opinions?
January 3rd, 2010 at 10:35 pm
I love Supraboy and richasian, I really do. To me they are the beating heart of the young Richmond crowd. I’ve known loads of young Chinese guys, and those two are exactly like the guys I knew: NOt especially bright and desperate to be seen as prosperous. They’ll do ANYTHING, buy real estate on bad terms, lease cars at rates they can barely afford, buy clothes on an almost maxed out credit card. Sooner or later it’ll all catch up to them but in the meantime, they think they’re high rollers.
The weather out here is awesome, loads of snow yesterday which just made puttering around at home more pleasant. Today I had a bunch of friends in for dinner. For amusement after dinner I showed them this blog. They got a great laugh out of it. They thought the disrespect shown to renters in the Van market was the mark of cheesy, wannabe Trumps.
I told them how much my place would be worth if it were in Vancouver, and we laughed some more. Then we all kidded around about the whole “best place on earth” thing. The longer I live here the better it feels. I realized the other day I haven’t seen a single Ed Hardy shirt or hat anywhere, which was great…. there are douchebags here, but they don’t seem quite as awful.
I’ll take snow that lasts a couple of days over constant rain any day of the week, as it turns out. Plus, from here I don’t have to interact with the real Supras and richasians.
January 3rd, 2010 at 11:05 pm
@scullboy: I generally enjoy your contributions, but lately they have had an air of “thou doth protest too much” about them. You’re sounding like the yin to Supraboy’s yang.
I have no idea what an Ed Hardy shirt or hat is. Maybe I don’t find myself in the same social milieu as those who wear them. We all have choices, and the larger the city, the more choices. Hell, you even have choices in the Vancouver real estate game. I choose to rent and to develop friendships with those who are not are the Supraboy ilk (i.e. poseurs). Vancouver’s not the “greatest place on earth”, but it’s a decent place to make a home…as is Halifax.
January 3rd, 2010 at 11:49 pm
scullboy, supra, arit, & richasian are all douche bags!!!
January 4th, 2010 at 2:16 am
@JK:
They are all the same people.
January 4th, 2010 at 9:42 am
@oneangryslav: I get why you might see my posts that way but frankly I am constantly suprised how much better my own life is now that I left Van. It’s a very subjective experience to be sure. There are a number of people in Halifax that I know from others cities who have had the same experience. What can I say, I write about my own experiences.
While one might have choices in van real estate they now seem to be reduced to “rent something of dodgy quality or sell yourself into slavery. ”
if I seem surprised it’s because it seems like there are now more choices in smaller cities, at least for me. Instead of banging my head against the wall looking for work, I’m able to network far more easily here because everyone knows everyone else and I don’t have to go up against 1,000 other people and a faceless HR department. I just got off the phone with an IT consulting group who heard I was in town. They have an opportunity they’d like to discuss.
Instead of constantly hunting for a decent place at an affordable price, I found a gorgeous spot first time out. When I’m ready there are tons and tons of cute little postwar places in great shape on nice lots for sale.
Yeah maybe I sound astonished. It’s because I am. It seems like there can be more opportunity and more choice in smaller cities now. I’m sure the poster who moved to Regina knows what I am talking about.
Meanwhile there seems to be a great deal of unhappiness on the board here. Let’s face it, it sucks to have to wait for a crash to be able to afford a decent home. People Herr seem pissed off, stressed out or are pretending to be someone they aren’t like supra or richasian.
It’s my own subjective reality but hey, I freely admit that.
January 4th, 2010 at 11:23 am
I’m not stressed or pissed off. I rent a nice place for an affordable amount of money (20% of income), and save 1/3 of my income as well. Life here is good. I like skiing and hiking, and travel quite a bit too (2 trips to Europe this coming year). Sure I won’t (not can’t) buy a house at these prices, but my life is not defined by ownership or not. If I can never buy here,that’s fine by me – I’ll just retire somewhere warmer (although in 30 years it may well be warmer HERE)- which I’ll probably want to do anyway, to be honest.
Happy renter.
January 4th, 2010 at 11:52 am
I was born and raised in Vancouver, then lived in Halifax for several years. What Scullboy says is correct. I’d still be living there but got pressured by family concerns. I regret moving back.
January 5th, 2010 at 12:54 am
@scullboy: For $1500/mo I am renting a house that the owner wants to sell for $1M. I am saving a good deal, and I am not going to buy anything here: what sane person would want to add headaches of taxes, maintenance and bank slavery for the rest of their lives?
Of course, if someone sits on 100% downpayment, it’s another story, but I am the average Joe. And no, I am not even close to being pissed off or stressed.
January 5th, 2010 at 4:06 am
#62 @scullboy: Nice call. I am pissed off and stressed out. I’m living in a cramped space, trying to raise a family, and watching the price of anything reasonable go up by more than I make in a year, every year. This is all backed by government credit, which I believe will bankrupt the country or something close to it, so that my family can look forward to crappy schools, hospitals, etc, when the free money party eventually ends.
There are few good opportunities in this country because the irresponsible have been bailed out. Most of our economy is based on rent seeking and leveraged speculation. The big banks offer 1% interest when core inflation is 2%, nevermind food which is 4% or transportation which is 5%.
I can tell you one thing, I am definitely not paying for this. I’m only in Vancouver to be near family, not to pay into some ponzi scheme. When things turn sour I’m voting with my feet. I want to start a high tech business and it sure as hell won’t be here. Basic costs are outrageous. Also amusing are the companies full of geezers who seem to think that people my age should work for half their wage, when they can’t do what I do.
January 5th, 2010 at 8:16 am
“Also amusing are the companies full of geezers who seem to think that people my age should work for half their wage”
———
Retrain? Move to a new industry? Move to a new location? We all have choices in life. Less whining, more proactive changing.
January 5th, 2010 at 9:00 pm
@Meat Robot: “but years of patience will finally start being rewarded for the prudent”
I am starting to suspect that the whole underlying concept of the Western civilisation has been to rip off and fleece the prudent till they die or flee. As long as some humans feel entitled to more, nothing can change.
So, as much as I anticipate the bright outcome you mention, history teaches that it is less probable than either of the following:
- no change at all (which may mean war in the long run);
- cancellation of debts*;
or
- money reform
This is the way it was done in Rome and Greece: read Plutarch, Tacitus, Livy for examples of financial acrobatics, government scandals, and social turmoil. It’s amazing how nothing has changed since then.
————
* Julius Caesar invaded Rome and became what we know him for mainly because of immense debts he had accumulated.
As for not mentioning real estate proper – it’s buried somewhere in the big picture.
Bull Hubris?… Or Appropriate Owner Confidence? – “My property got assessed 20% higher than last year! Wooooohooo! I’m going to refinance for another house while you cry-babies live in the dumpsters.” « Vancouver Real Estate Says:
January 7th, 2010 at 11:03 am
[...] who calls himself ‘richasian’ (and who is quite probably neither rich nor asian) on vancouvercondo.info 2 Jan 2010 at 2:54 pm and 6:04 pm – “Happy new year you scum sucking renters!!!!!!! I hope 2010 brings continued [...]
Bull Hubris?… Or Appropriate Owner Confidence? – “My property got assessed 20% higher than last year! Wooooohooo! I’m going to refinance for another house while you cry-babies live in the dumpsters.” « Vancouver Real Estate Says:
January 12th, 2010 at 9:47 am
[...] (and who is quite probably neither rich nor asian) on vancouvercondo.info 2 Jan 2010 at 2:54 pm and 6:04 pm – “Happy new year you scum sucking renters!!!!!!! I hope 2010 brings continued misery as you [...]
Bull Hubris?… Or Appropriate Owner Confidence? – “My property got assessed 20% higher than last year! Wooooohooo! I’m going to refinance for another house while you cry-babies live in the dumpsters.” « Vancouver Real Estate Says:
January 16th, 2010 at 5:54 pm
[...] (and who is quite probably neither rich nor asian) on vancouvercondo.info 2 Jan 2010 at 2:54 pm and 6:04 pm – “Happy new year you scum sucking renters!!!!!!! I hope 2010 brings continued misery as you [...]