Olympic rental market ‘oversupplied’

This article is a few days old, but still interesting and worth discussing.  It seems that if you haven’t rented out your home or condo yet for the winter games, you may be facing a lot of competition and have to ramp down your expectations of getting rich off the games.

Metro Vancouver homeowners desperate to rent their properties to Olympic Games visitors have scaled back their golden expectations.

An abundance of Games-time accommodation rental options has forced asking prices down and increased the likelihood that many properties won’t attract any Olympic renters.

“Don’t base your food budget on the prospect of renting your home,” said Mark Szekely, site administrator for listing service rent2010.net. “It’s still a realistic possibility but if you’re outside downtown Vancouver or Whistler, you might not find a renter. It’s an oversupplied market.”

Anyone out there subletting their owned or rented house or apartment for the games (or trying to)?

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[…] Olympigs 14 Jan 2010 10:49 am – “A unit at 555 Jervis advertised in Craiglist for the past year has been asking from $3,500 to $5,000 and now $3,000. It was previously rented for a paltry $2,000 p.m.” […]


@Purp – The problem with permenantly higher arguments is that RE doesn't operate in an economic vacuum. We can't have 60% of income monthly housing cost long term and have a healthy economy! People need to pay for other things for the economy to work. We can have pockets of gentrification and expensive cities compared to income, for sure, but after a point – when the credit needs paying and is not an increasing influx stimulating the economy – you cannot keep climbing. We're spending more than we make. Someday, we're going to have to make more than we spend in order to service that debt. Of course, in some developing nations RE sits at 60% or 200% or whatever. So, sure, if we're aiming that direction. End of the first world and the middle class – all of us… Read more »


absinthe- re jacking the rent and house sits vacant- I have rented for the last 4 years in both Ireland and Canada in 2 different houses. I get the feeling there are a lot of amateur landlords out there based on the prices I see them asking. My current landlord undercharges me by a few hundred a month- which is a wise strategy. Ever heard of "work to rule?" If he jacked the rent on me I would be all over him about every little thing that needs fixing.IT would not take much of my time or energy, but it would make his life miserable, and that would be the point. For the extra $200 a month he got from me I would extract $500 worth of pain in the neck. But because he undercharges me, I let it slide… Read more »


@Dave — Thanks for the link to the RBC report. I'm not sure it really makes your point about affordability though, quote from the Vancouver section (pg. 4) — "This near frenzied tone to the market is occurring despite still historically poor, and now deteriorating, levels of affordability….even though the affordability measures fell substantially during 2008 and early 2009, they remain well above long term averages." Interestingly when you lay the 'affordability' graph overtop the 'price/income ratio' graph for Vancouver you get pretty much the same shape. Both have long term increasing trends. It's obvious this trend is not sustainable long term, but the question is what is the new 'normal'? I doubt we will revert back to the days of 4x income and <30% income anytime soon. Wishing away the CMHC and cheaper money is probably not going to… Read more »


@oneangryslav2: Seafield Apartments – their building was bought a couple years ago now and right after the new landlords came in, they wanted to increase people's rents by something wild like 78%. Housing Analysis featured the RTO decision … um, in the spring? I don't really know. The RTO allowed some rents to be increased. Anyway, the Supreme Court overturned that decision yesterday because of too few comparables. Sounds like the tenants had comparables, too, that the officer didn't look at.



Manhattan apartment rents dropped 9.4 percent in the fourth quarter from a year earlier … according to a report today by broker Prudential Douglas Elliman Real Estate and appraiser Miller Samuel Inc. A separate tally by broker Citi-Habitats Inc. showed the average apartment price declined 7.3 percent for the year.

The effective decline in Manhattan apartment costs was likely greater than either broker reported because the figures don’t reflect concessions such as a free month’s rent …

But that can't happen here, because we're a "world class" city and we're running out of land.



I think affordability is the best metric.

Why don't we forget about "affordability", which is based on conjectures about which households with which incomes are buying which properties, and just look at price/rent for a given property, and its reciprocal, yield, which are completely objective?

Price/rent for any kind of property in Vancouver is comparable to the highest priced markets in the US in 2006. And net yield, i.e. (rent – expenses)/price, for any property in Vancouver is below borrowing costs, which today are at historic lows.

If that's not a bubble, I would like to know what is.



"Like those landlords downtown losing in court and saying it’s unfair because the renters are paying only half their carrying costs."

Would you care to clarify? Which landlords? I'm curious. And who has been suing whom?


@Drachen: Ach, don't let Dave get to you! He's just the slightly more well spoken version of richasian. We know Dave's thoughts: monthly affordability. And he's right on the most basic level, insofar as People Are Buying Houses right now, and they're doing that because they can afford (right now) the monthly payment. Where "afford" means not miss their payments and still have enough combined cash and credit left over to feed themselves. That's fine. We've heard that argument and seen the disproof in places all over the planet. (Or at least, I have heard the argument – I've been watching the states since 2003, and this is a very tired old saw.) Even IF home prices never dropped here, it wouldn't be because Dave's argument makes sense. He appears to have another argument – we don't have lots of… Read more »


Apparently the banks are following up hard on people who inquire about mortgages, with the old "what can we do to get your business" calls. I guess that's when they offer you the 7% cash back on the 5% 35 year mortgages. I assume that the big 5 banks will all have booths at the PNE next summer— strategically located between the Pink Solution and Shamwow. I can hear it now: "STEP RIGHT UP!! Get your government guaranteed mortgage. Loans up to 5 times your income. Is a 5% down payment too much? Well, this is what I'm gonna do for ya' today: Not only will I give you back 100% of your down payment, I'll through in an extra 2%!!! Yes that's right— you heard it here first. But this offer wont last long, so you better take advantage… Read more »


Apparently the banks are following up hard on people who inquire about mortgages, with the old "what can we do to get your business" calls. I guess that's when they offer you the 7% cash back on the 5% 35 year mortgages.

I assume that the big 5 banks will all have booths at the PNE next summer— strategically located between the Pink Solution and Shamwow.



I think RBC uses a good measure. It uses a 5 year fixed rate, 25% down, 25 year mortgage and average household income.



– how are you defining affordability, monthly payment vs income? What would you consider the range of historic norms for affordability?


@browntown: Drachen also owe big chunk of money from the bet he lost to his fellow bloggers, size of that payment is equal to 25% of then required payment almost $350,000. 25% value of the house that drachen is currently renting,Oh yeah if you don't believe me you could ask Drachen about his prediction that went otherway around,Down side UP.


oh yeeaah nutslaps! OHlympics almost here! lets hope LOUngo's not goaly for shootout! Drackens' wife say

"browntown i want to party like its' 1988"


It's so great to watch greedy Vancouverites get totally screwed.



"Missing a bet and being incorrect are different. My prediction was correct, my ‘bet’ was not."

What planet do you come from, seriously? You MADE the prediction THEN Freako made the bet that you'd be wrong (and I believe I took you up on it after him). How can you possibly claim that even though you lost the bet you weren't really wrong. I'm seriously beginning to wonder about how your brain is wired, there's some loose connections upstairs.

You're starting to go into your bizarre-erratic mode again, it usually comes up when you're in the middle of being conclusively proved wrong or a liar (or, as in this case both). Are you going to be like this when you lose our current bet too?


In general, what will the qualify you at? a 5 year fixed?



You are correct, the advertised rate is 2.15%. That is the rate of the loan, not the rate used to calculate if you qualify for the loan. You will have to qualify at a higher rate since its variable and can go up as the prime rate increases.



Missing a bet and being incorrect are different. My prediction was correct, my 'bet' was not.

Pied Piper


It's official,no housing bubble in Canada.

And we do trust the pimps who put out this report don't we.



"Thus your math isn’t exactly correct since the bank wouldn’t use 2.15%…"

I got this from:


I thought the 2.15% that they are advertising for the variable 5 year term is their index + margin (in this case, 2.25% – 0.1%).


@Dave: Wow, man you could give the "No terrorist attacks during Bush Presidency" Righties a lesson in revisionist history Dave. "You are 0 for 24 by your own math." Seriously? Is the sunrise analogy too much for your brain to handle? I thought I was dumbing things down enough for you, apparently not… Look, every prediction you made and the bet you made with Freako were substantially wrong. Yes you called for a correction but you said it would correct and stabilize, it did not, it spiked which means you were WRONG. You called a listings peak time and you told us how much it would fall by a given date, you were off by a month (or was it two) on your peak call and off on the amount of the fall. How you can put that in your… Read more »



That cuts both ways. There are risks to waiting as well.



I think affordability is the best metric. And of interest, we are still within historic norms at present.

I think that over time, affordability will naturally decline due to higher density. I think a better affordability metric would be to separate each class of real estate (SFH, attached and condo) and apply average family incomes for that particular demographic that is BUYING real estate.

I don't think averages work well anymore because there aren't enough SFH lots to go around.