Cruise ship hotel plans sinking?
Some more winter-game accommodation stories in the news: There appears to be a problem with the plan to house some visitors in a cruise ship.
A plan to berth an 1,100-room cruise ship in North Vancouver for use as a floating hotel during the Olympic Games appears to be in serious danger of sinking.
Edmonton-based Newwest Special Projects – which has marketed the Norwegian Star to Games visitors for the past nine months – said in a statement over the weekend that sales have been disappointing while expenses have increased beyond expectations. It said it is negotiating with its partners to try to lower costs and keep the project alive.
They initial priced rooms at $1,300 a night, dropping that to $500 per night in October and recently lowering starting prices to $275 per night including free meals. They appear to have removed their booking gateways from the internet as they work out their current problems.
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February 2nd, 2010 at 7:36 am
The Olympic bulls, like the RE Bulls, believed that there was no limit to what people would pay. $1,300 a night? Rediculous! Now prices are at $275. That’s a 78% drop in asking prices.
The same thing is going to happen in Van RE. We are so very close to the monthly payment limit that was reached in 2008 resulting in the 20% crash that was halted only by a 0% BOC rate.
When people simply cannot do the monthly payment, the prices will crash but with no BOC saftey net this time. Rates can only go up. Look out for a 60% crash in Van RE.
February 2nd, 2010 at 9:26 am
I wonder what happens if it actually gets canceled. Will the stranded guests cancel their trip altogether, or will they desperately look for other accommodations? I guess it depends whether they get refunded. I can’t help but think this will wind up rescuing many greedy “olympic landlords”.
BTW $1300 a night on a cruise ship is ridiculous, but makes way more sense than $1300 a night for some house in the suburbs.
February 2nd, 2010 at 9:27 am
ROTFLMAO…..!!!!
$1,300 a night ???!!!
$500 a night ???!!!
$275 a night including free grub ???!!!
I bid 100 Quatloos.
February 2nd, 2010 at 10:08 am
@mino3:
“Desperately”? I don’t think so. Over 1000 matches on Craisglist:
http://vancouver.en.craigslist.....;bedrooms=
February 2nd, 2010 at 10:14 am
100 quatloos seems a bit extreme.
at least quatloos are tied to the price of the humbugoo bean, so have some actual value.
February 2nd, 2010 at 10:20 am
@logic:
Include a contemporary facsimile of Angelique Pettyjohn with the room, and I’m in.
February 2nd, 2010 at 10:22 am
And many Vancouver hotels are reporting vacancies. Most of downtown is pretty full but outlying areas have tons of room according to the CBC.
February 2nd, 2010 at 10:31 am
$1300: one week in mexico at a 5 star including flight for every one night in rainy vancouver on a boat? Ya, that sounds good. Why don’t you sign me up for 3 rooms for a couple weeks. Idiotic?
Dear blog dogs…are you aware of any graphs showing %per capita of canadian home ownership? There’s a ton of info on the US but I can’t find any in Canada. I find this statistic to be very telling. It is a good indicator or representing a medium term “outlier” for temporary demand increase. Also, if you look at the US they still have a ways to go down. The previous 50 years prior to the US boom was between 63-66% home ownership. We are still a couple of percentage points away from this. Where does Canada stand in all this?
February 2nd, 2010 at 10:53 am
I’m surprised that the advertising campaign didn’t work.
(nsfw link)
http://www.youtube.com/watch?v=R7yfISlGLNU
February 2nd, 2010 at 10:57 am
I seriously wonder if anyone paid 1300. It kinda reminds me of RE and everyone seems to think those prices are pretty good.
Everyone started charging huge prices then the prices came down as they realised everyone wasnt insanly desperate to come to vancouver. This of course makes no sense to people who own here, because they are insanly desperate to live here.
February 2nd, 2010 at 12:14 pm
@davers:
This of course makes no sense to people who own here, because they are insanly desperate to live here.
There you go, I was wondering for a while what’s the reason behind the urge of those who apparently can’t afford to live/own in this city and came from underdeveloped and 3rd world countries? How they got hook on the Vancouver RE crap? The answer appears to be simple, they just wanted to look prosper and powerful before their friends, colleagues, cousins etc whom they left behind. I can imagine what kind of shock Vancouver images with mountains, ocean, glasshouses and yachts have on relatively poor, hard working people, they must be thinking that their relatives became rich celebrities living in the paradise. Making one envious while rendering false image of being loaded, successful while living a dream in the most livable city has its price. Unfortunately like any other charade this one won’t last for ever.
February 2nd, 2010 at 12:31 pm
Mish: Australian housing bubble to implode.
http://globaleconomicanalysis......ls-in.html
How much longer will we wait?
February 2nd, 2010 at 12:33 pm
#10 @davers: “I seriously wonder if anyone paid 500k.”
There, fixed that for you. We’ll be saying that about condos in a year
February 2nd, 2010 at 12:49 pm
Another great post by Mish on the Australian mega-bubble (every big city overpriced to BC levels):
http://globaleconomicanalysis......ls-in.html
Substitute “Canada” for “Australia” and “Harper” for “Rudd” and you have a perfect match. Rudd however is a socialist and at least is not being a hypocrite in his attempts at intervention. Harper is supposed to be a believer in market forces, and rest assured Mr. Market is going to come around and show him who’s boss.
February 2nd, 2010 at 12:55 pm
14 – yes, Mish hits the very big nail with the big hammer with this one. I enjoy most of his blog, and he’s a wonderful source.
February 2nd, 2010 at 1:09 pm
Australia did everything Canada did and more to goose the housing market. I’m waiting for the AUD to implode so I can buy some. Since the returns on CAD are less than inflation I don’t want to hold Canadian dollars.
Canada can get away with 0% rates due to our connection to the US. But I think Australia can’t, and I doubt they can lower it much from the current 3.75% now that they’ve raised it. They are a little bit ahead of us it seems.
Can anyone suggest some other currencies to hold? I’m thinking 1-2 year bonds, rolled over as rates rise. I might buy some Euros if Greece blows up. And countries like Sweden, Finland, and Denmark seem very well run.
February 2nd, 2010 at 1:13 pm
Mishs’ analysis is good, but his politics irritate me. In one of his recent posts he suggested closing libraries, etc. Now I can understand him railing against six figure public salaries which are double the community average. But simply tearing everything down shouldn’t be the first option. I think he’s been grinding his axe too long.
February 2nd, 2010 at 1:25 pm
Finally found the answer gang… page 10 for homeownership rates back to the 70′s ending in 2006 : ( Guarantee it has gone up further since then. This will decline to norm like the US did.
http://www12.statcan.ca/census.....006001.pdf
February 2nd, 2010 at 1:27 pm
@rp:
If you’re holding cash to buy a house, the only thing that matters is which way nominal house prices move, right? The return of house/CAD going forward looks pretty good.
The increased risk of holding foreign currencies does not warrant the prospect of increased returns in the short term IMHO. I have a bunch of foreign equities in my RRSP, but that’s another matter – diversification, not currency speculation.
February 2nd, 2010 at 2:06 pm
#19 @patriotz: Thanks for the advice. I may not buy a house though. It has simply taken too long. My patience has been running out while my disgust has mounted, and now I’m inclined towards other life plans. I’m not waiting it out, and I’m not interested in paying for everybody elses’ party.
February 2nd, 2010 at 2:37 pm
9 anon
Did anyone else watch that video? This is a joke right? I am amazed at what the young people of today consider music.
The only thing I can see holding back the housing crash is our weak laws and the prosecution of these criminals. In particular drug houses and all that tax free money. I believe this has an impact on our housing boom. Something that the US has much less of. If you get caught with a bag of Mariana in the US you will do time,and they will confiscate everything not like here.
February 2nd, 2010 at 2:45 pm
I am booked on that cruise ship that is leaving on March 2 from Vancouver after the olympics end…if this thing is cancelled the ship wont be coming up at all..what a bummer it would be to miss out on my 4 night cruise to LA.
February 2nd, 2010 at 3:35 pm
I can’t believe a $7B drug industry doesn’t influence the economy of BC. How can it not? Housing is a perfect money laundering vehicle. Just think about all the cash you can use for all the associated expenses including renovations.
February 2nd, 2010 at 3:48 pm
@ #21 Disbelief
Yes, that is a joke… it was on Saturday Night Live.
February 2nd, 2010 at 4:10 pm
Does anyone have an updated price / rent ratio chart for Vancouver?
The last one I can find is from 2008 and is missing some axis labels
http://housing-analysis.blogsp.....ratio.html
February 2nd, 2010 at 4:32 pm
#23. Anyone telling you that the dope biz is not front and center in the real estate market is just plain stupid. The main buisness of many agents and notaries is the drug monenied clients. The government knows this, the police certainly know this, they confiscate houses all the time and have been for years. In the construction biz (res) the suppliers and crews are paid cash.
What is happening is the government turning a blind eye to the issue and for reasons of thier own not wanting to publicize it. It is a very big buisness for new immigrant families, maybe its the new immi lobbies and the ‘private lending’ that goes through the temple banks that makes it a ‘step up’ for those communities involved.
Speaking of the temple banks how much sctutiny is going on when the transfers are being made from that bank to accounts and purchases around the world?
$7 billion doesn’t just dissappear. The authorities are not willing )like many issues in this great dumb land of ours) to go public with any information.
Anyone want to explain why a refugge family from the Punjab suddenly comes up with the millions of dollars to purchase large acerage and dozens of building lots after only a couple of years in the country as truck/delivery/cab drivers while the women have been wrapping cucumbers in the greenhouse?
Ditto, refugees from Vietnam who claim total poverty and collect welfare cheques at several addresses all of which they own. There is no data base that cross checks the financial information. Everyone in the Vietnamese community has at least five members of the family manning a grow op.
C’mon, are we all that stupid? If I had to do it all over again I would definatley grow pot because there is no penalty and no seizure laws that would disuade anyone from the enterprise. Of course the $7 billion is buying houses.
February 2nd, 2010 at 4:50 pm
realpaul, come on, that’s a tired old myth. Drugs were here long before the bubble and will be here long after the crash. Its effect would be almost negligable, like it was in Miami or anywhere else that has an even bigger drug market. Don’t bother comparing drug enforcement policies of various nations – the “war on drugs” has long been lost.
By far the biggest fuel for the housing bubble has been loose lending standards.
February 2nd, 2010 at 4:58 pm
hi VRENGD, can you tell me what is this “monthly payment limit” and how are we approaching the limit and how is this triggering the crash?
Thanks for your time
February 2nd, 2010 at 5:07 pm
@realpaul:
You’re a real piece of work. I guess I must know the only ten Vietnamese families in Vancouver who don’t own a grow-op. Take your racist b.s. to another forum.
February 2nd, 2010 at 5:17 pm
“They initial priced rooms at $1,300 a night…”
These people most certainly had overactive amygdalas.
February 2nd, 2010 at 5:37 pm
@BoB:
It’s even better than that! There are folks out there who rent out properties and get a good cash flow but don’t actually have any tenants (some even have grow-ops but you don’t need to do that if you really don’t want too). And where to you suppose that revenue comes from? It’s perfect, the individuals that would be paying the ‘ghost’ rent would presumably be in a higher tax bracket so they the don’t qualify for any GST rebate, so even if someone was looking for where the cash flow is coming from, they wouldn’t expect to find anyone reporting rent payments.
In addition, got some more cash you want to launder? Buy a dump (err, fixer upper), pay cash for a bunch of materials and labour (oh no, nobody in the construction industry works for cash) and then, to add insult to injury, you historically (at least recently anyway) see at a big profit and you don’t even have to pay tax as the profit is capital gains exempt (as long is it’s your principal residence, and it was right, wink, wink).
The current system is tailor make for laundering money, and as a side effect, drives up home prices. Think about it, the more ridiculous the prices, the easier it is to rinse the cash.
February 2nd, 2010 at 5:41 pm
@Slim:
February 2nd, 2010 at 5:49 pm
@Slim:
Yeah right. I have a few questions for you.
Prices in Vancouver starting dropping quickly in spring 2008. Why did this happen? Did your money laundering schemes suddenly become undesirable? Why? You said, “the more ridiculous the prices, the easier it is to rinse the cash”.
Then in 2009 they started going up again? How come?
I will answer the questions for you:
Prices started falling because ordinary mortgageholders could no longer afford to buy. They starting rising when the fall in interest rates allowed them to buy again. They are the marginal buyers who determine the market price, not real or imagined money launderers.
February 2nd, 2010 at 5:58 pm
According the Forbes we are the most beautiful city in the world after the Paris. It would have been funny if it wasn’t sad.
February 2nd, 2010 at 6:08 pm
really? beautiful setting for a city, but not city itself, surely… most of our architecture is at best “functional”, and some of it downright hideous
February 2nd, 2010 at 6:08 pm
@patriotzed
You are correct…and the margins are what tanked the US market. We’re no different at all. They had a head start with unemployment and that combined with historically high prices and one-time cheap money coming due…
Rinse-Repeat
February 2nd, 2010 at 6:19 pm
@rp:
I’m not sure he’s too off in closing libraries. In Lynn Valley they spent over $40 million on a new library, there’s another $30 million one planned for north Surrey and I think one for Lonsdale.
I’ve been to the Lynn Valley one several times (coffee shop next door) and it’s mostly empty.
Now consider that at Amazon in December book orders through Kindle outnumbered physical book sales for the first time.
Will we really be checking out books in 5 years or ten; or downloading them like itunes?
I don’t think these city councils are very aware of the very rapid pace of technology. And $40 mil is a hell of a lot of money for a little community like Lynn Valley.
February 2nd, 2010 at 6:37 pm
@chip:
No I disagree. Libraries are not just about paper books, they are sources of every kind of information. Take them away and you become a society of information haves and have nots. They also constitute a very small part of municipal spending.
But the muncipipal fiscal crisis in the US is not very relevant to here. In many US states property tax revenues vary directly with property values, i.e. they have a fixed mill rates. Also pension obligations can vary substantially from city to city (as he discusses a lot). In BC municipal pensions are tightly regulated at the provincial level and the kind of pension crisis he talks about cannot happpen. Another very important factor is that health care costs are a large component of public sector (and other sectors such as auto) pension costs in the US (particularly for police and firefighters who retire well before they can collect Medicare at 65) and they are not here.
February 2nd, 2010 at 7:20 pm
‘ The wrong kind of Olympic spirit ‘
http://www.guardian.co.uk/comm.....melessness
February 2nd, 2010 at 7:23 pm
CBC just confirmed the Norwegian Star is canceled. Visitors need not worry as Vancouver homeowners will line up to take advantage of them.
February 2nd, 2010 at 7:24 pm
As we speak China is pouncing on the housing bubble over there and is determined to burst it. Guess how many Chinese own over priced bubble homes in Vancouver and what a house price crash in China will do to the prices here. Oh, I can’t wait.
BTW a local groundhog just said that there will be 6 more weeks of snow melting spring weather to coincide with the 2010 Corporate Orgy
February 2nd, 2010 at 7:52 pm
Vancouver ” Greatest fail on earth! ”
February 2nd, 2010 at 8:02 pm
http://www.cbc.ca/canada/briti.....elled.html
haha There goes the cruise ship idea.
February 2nd, 2010 at 8:38 pm
http://vancouver.en.craigslist.....41320.html
haha this made my day … pure greed.
” As an added perk, being an official Torchbearer, I have my uniform and torch that I can make available for taking photos by the potential renters. ”
February 2nd, 2010 at 9:17 pm
MLS press release:
“Over the last 12 months, the MLSLink® Housing Price Index (HPI) benchmark price for all residential properties in Greater Vancouver increased 17.2 per cent to $573,241 from $489,007 in January 2009. This price is 0.8 per cent above the previous high point in the market in May 2008 when the residential benchmark price sat at $568,411.”
February 2nd, 2010 at 9:17 pm
@patriotzed:
Nothing I stated contradicts your position. What? Do you think that a price drop is going to stop people from laundering cash through RE? Why would it?
I didn’t say that laundering cash caused the bubble, I said that it’s a contributing factor. As someone else pointed out: all the illegal cash is going somewhere and it’s not all going to leased cars and dinners out.
And, the more expensive the prices, the easier it is to rinse. What don’t you get about that? Is it easier to hide $100k on a $150k house or hide $100k on a 2.5M house?
And why has drug money been more of a factor in recent years – the answer is obvious if you think about it. With the bubble, with lots of cash laying around, there’s more money to be made in RE than in drugs, and the money is washed. You’re just plain naïve if you don’t think this is happening.
February 2nd, 2010 at 9:29 pm
@Dave:
So, from May 08 to Jan 2010, 19 months, prices went up .8%. Wow, prices never do go down.
February 2nd, 2010 at 10:22 pm
VANOC ready to stop ambush marketing at venue gates
When it comes to so-called guerrilla marketing, quantity matters. Spectators can wear whatever brand of clothing they want into 2010 venues.
But get, let’s say, 20 people sporting the same non-sponsor t-shirt at the gate, and there might be a problem.
“Obviously we’re going to stop ambush marketing,” said Jan Damnavits, VANOC’s director of city venues……..
http://thetyee.ca/Blogs/TheHoo.....10-venues/
February 2nd, 2010 at 10:57 pm
So according to some of the shocking politically correct, the 7 billion that is raised in BC bud cash in BC is all sitting under the floorboards of the poor immigrants shanties?
Hold your breath guys and see if your still on earth when you exhale. Examing the Vietnamese involvement in the drug trade is very well publized and not ( BIG KNEE JERK) rascist. It is a well known boo hoo liberal strategy to cough up rascisn accusations when the argument becomes uncomfortably correct.
Or scenario two, the Hells Angels never spend thier money (billions)and live in the east side dumps most (majority) of them live in but have billions under the floor boards? Look these guys are scum bags not international financiers.
The cops are spinning this dope thing as organized bike gangs etc because the public perception gets them leverage at budget time. If the cops start coming out and cleaning out the immigrants ill gotten gains then thats a problem?
People that disgree with the truth are the morons who hold this entire country back by allowing the wrongs to go unrighted because they don’t want to upset the feelings of the poor refugees ‘who need a break’.
The new immigrant dope dealers outnumber the hells by factors of thousands. Don’t let the police misle your understanding of reality. The cops need a focus for thier public attention campaign. They don’t like the idea of trying to sell the idea of the Gurdwara being a place of buisness as well as holy happy times.
February 2nd, 2010 at 11:12 pm
While I’m at it I may as well kick the rest of the weasels and deniers in the nuts. We all know now that the entire climate boondoggle was a lie and a scam with the sole mission to misle the world into raising funds for third world development. It has been proven and the perpetrators have admitted to the lie.
So, all of you timid intelligences who fought so hard to stay on the politically correct bandwagon because you haven’t a thought of your own to carry you through the day. Heres another nail in the coffin of why the truth should be lionized and screaming out catch phrases that have replaced any personality you may have had before you drank the kool aid is just stupid.
http://www.guardian.co.uk/envi.....eer-review
February 2nd, 2010 at 11:30 pm
@Slim:
You have no real understanding of how money laundering works do you? Real estate would be a terrible place to do it. Here’s why.
Money laundering is a method where you take a legitimate business front and then you run your illegal money through it as “profit”, you pay your taxes and everyone is happy, nobody wants to go through a dry cleaner’s receipts to check if every customer on the books is legit.
That can’t happen with real estate because the exchange of property is recorded so anyone can tell who paid how much money to whom and you can’t make money appear as if by magic because the SOURCE of the money is recorded so it would have to be already laundered money at that point.
February 3rd, 2010 at 12:08 am
Drachen,
You are wrong dude. I am in the biz, and I know it is happening.
February 3rd, 2010 at 1:29 am
We are different, it’s not going to happen here. We are safe and RE collapseproof. We are smart and know how to keep the show running. Those guys south of border are just bunch of amateurs.
http://www.nytimes.com/2010/02.....3walk.html
February 3rd, 2010 at 4:23 am
@Slim:
I didn’t say that, dummy. What I said is that money laundering (or other exotic sources) cannot support RE prices as the price level is determined by what the least able and willing buyer, Joe Homedebtor, is able to pay.
Any fool can see this from the price behaviour over the past couple of years, but it looks like you’re not just any fool.
February 3rd, 2010 at 6:11 am
@2010:
And just how are they going to know at the gate what kind of t-shirt someone is wearing? It is wintertime, you know.
February 3rd, 2010 at 12:23 pm
@Slim:
Well, if you’re in the drug trade and you’re stupid enough to admit it on a public forum then I can see how you’d think laundering money through real-estate was a good idea too.
February 3rd, 2010 at 12:48 pm
I believe Slim was referencing the fact that he is in the construction industry, and sees the flow or cash to workers and the buyers of houses. Thats all.
And I really dread supporting anything Real Paul has to say, but if you know anyone on the VPD and other municipal police forces, they will admit that there is some validity in what RP has said about those involved in grow ops.
A sergeant friend of mine on the drug side of operations admitted a few months back how pervasive the problem is. He admitted that they were so busy just dismantling the grow ops and running to the next one, that they did not have the time to prosecute the operators. Apparently, things have slowed down now though…
February 3rd, 2010 at 1:46 pm
@Dave: awesome, now the bubble is really forming!
February 3rd, 2010 at 2:57 pm
@Drachen:
That can’t happen with real estate because the exchange of property is recorded so anyone can tell who paid how much money to whom and you can’t make money appear as if by magic because the SOURCE of the money is recorded so it would have to be already laundered money at that point.
——-
Did you read what I wrote?
You don’t think that I could spend a $100k on renovations that would significantly increase the value of my house (way more than original $100K invested in reno’s) and never have a receipt to show for it? You’re kidding right? I buy a house, pay a whack of cash under the table for upgrade materials and labour and sell for a huge profit. How exactly would that be tracked? It’s money that’s washed clean and not traceable, and to boot there’s even a big profit. My goodness you’re naïve!
February 3rd, 2010 at 3:02 pm
@patriotz:
I didn’t say that, dummy. What I said is that money laundering (or other exotic sources) cannot support RE prices as the price level is determined by what the least able and willing buyer, Joe Homedebtor, is able to pay.
-======
I didn’t say that money laundering supports RE prices. I said that housing is a convenient avenue to launder money and if it’s not obviously clear to you why, you’re in denial. Laundering money is another piece of the puzzle that can make higher prices affordable for some.
February 3rd, 2010 at 3:09 pm
@Drachen:
Well, if you’re in the drug trade and you’re stupid enough to admit it on a public forum then I can see how you’d think laundering money through real-estate was a good idea too.
=====
Since I’m not the Slim that you’re referring too (that’s a different Slim than the original – me), I won’t take offense to you’re comment.
February 3rd, 2010 at 3:40 pm
@Slim:
You were responding to another poster who said the drug trade supports the economy, and by implication RE prices (that’s what this blog is about, you know).
I think this website is more your style. Maybe they have a comments section:
http://www.cheechandchongtour.com/splash.html
February 3rd, 2010 at 11:31 pm
“In Lynn Valley they spent over $40 million on a new library,”
Let’s see now. The approx population of Lynn Valley is about 8,000 including children. A new computer with 10 years internet connection cost about 2,000.00 maybe less
If one divides the population into a family unit then there are about 3,000 familes
3,000 times 2,000 = $6,000,000.00
Close the libraries and have a central one where people can order a book and have it delivered and returned the same way…mail