Friday FREE FOR ALL!
Hey now, it’s the end of another week! Lets do our regular end of the week news round up and economic open topic discussion post. Here are a few stories I’ve noticed lately:
-Lightly used waterfront condos: $1100 /sq foot
-Vancouver now almost as world-class as Toronto!
-Canadians spent at the winter games
-Canadians drank at the winter games
-Suprise drop in Canadian building permits
-Monster houses at risk in Vancouver earthquake
-Feds aim for $17.6 billion savings in five years
-Flahertys ‘tough budget’ may be a year away
-I’m sure glad the recession ended
-The big US ARM reset
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So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!
March 7th, 2010 at 10:42 pm
@WORLDS GREATEST LOVER:
130
X WORLDS GREATEST LOVER Says:
The argument against your point was posted by someone else above. To wit: Illegal drugs are not a new occurrence in BC, so they can’t be blamed for the rise in house prices.
++++++++++++++++
I never blamed the "invisible tenant" for the rise in house prices, I said it was a contributing factor. I never based my statements on manufactured statistics or anecdotes masquerading as fact, but rather real life experiences. I'll say it once more; I've met more than a few people who only can afford their homes because of the grow op in the basement. This inflates the housing bubble. Billions of dollars are "laundered" in this province every year with a large percentage undoubtedly going into real estate.
March 7th, 2010 at 10:34 pm
Typical families don't mix small children with pitbull crosses.
March 7th, 2010 at 9:54 pm
@No Longer Looking:
Totally naive. Latest grow op bust in Shaugnessy? Young couple with a pit bull cross and a preschooler. Met the mom, kid and dog in the park a few times….
March 7th, 2010 at 8:23 pm
Your typical family with children is not going to have a grow-op. They are a known health hazard. If I knew of such a thing among my family and friends, I'd make a quick call to child protective services. Not for a couple of plants, of course, but for a true grow-op.
Grow-ops also attract criminal attention, and eventually destroy the house.
March 7th, 2010 at 6:17 pm
@Chilled: The problem with the 'invisible tenant' investors is that it's real easy to remove them from the marketplace. Anyone paying their mortgage by growing weed in their basement is one phone call away from a heap of trouble. I suspect the city will start being more aggressive about seizing property due to drug crimes now that they have their own money problems.
That's not really the argument against your point though. The argument against your point was posted by someone else above. To wit: Illegal drugs are not a new occurrence in BC, so they can't be blamed for the rise in house prices.
March 7th, 2010 at 6:12 pm
Re: "invisible tenant"
Why oh why do people bother buying a house and then have a couple or family move in downstairs? Doesn't this somehow defeat the purpose of "single-family housing"? It just seems ridiculous to brag that you now "own" a SFH, yet in actual fact it is NOT a SFH. Why not forget about the tenant issues and just buy a townhouse? Some of the houses in Vancouver barely have yards anyway, so what's the point?
I swear, people are CRAZY!
March 7th, 2010 at 5:26 pm
@patriotzed:
116
X patriotzed Says:
March 7th, 2010 at 4:46 am
@Chilled:
The proof that actual incomes (whether reported or not) are not any higher in Vancouver than in Calgary, Toronto, or Ottawa is that rents aren’t higher. For any kind of property from Surrey basement suites to Shaughnessey mansions.
Period.
++++++++++++++++++
Proof of what? I don't give a rats ass what statistics say, yours or anyone elses. The fact is I know a few people who are able to pay the mortgage ONLY because of the "invisible tenant" in the basement. My point was, BC's multi-billion dollar a year drug industry helps to artificially inflate the real estate bubble. I'm unsure how anyone can deny this. To what degree, who knows?
“In my own line of work, I get access to a lot of private company info including salaries. I am consistently amazed at how low the majority of salaries are in Vancouver relative to other parts of Canada.” « Vancouver Real Estate Anecdote Says:
March 7th, 2010 at 4:56 pm
[...] March 2010 · Leave a Comment Clarke at vancouvercondo.info 6 Mar 2010 4:58 pm – “In my own line of work, I get access to a lot of private company info including [...]
From Someone Who Left – “That’s the problem with Van: It promises so much, but delivers so little. Unless you’re making a ton of money.” « Vancouver Real Estate Anecdote Archive Says:
March 7th, 2010 at 4:49 pm
[...] March 2010 · Leave a Comment scullboy at vancouvercondo.info 6 Mar 2010 9:25 am – “I [also] gave up caring about ownership, and actually I had a good hard look around [...]
March 7th, 2010 at 4:43 pm
Asking $260k for a condo that looks eerily similiar to the developments at Arbutus and 12th…except it's in Seattle…
http://www.trulia.com/property/1040377334-1610-Be…
Also, agent Will's weekly stats – 8700 total listings in Van now – he does not include Surrey and the Valley in his numbers.
A quick search on Trulia at total Seattle listings shows 4,100.
hhhhmmmmmmmmmm
March 7th, 2010 at 4:36 pm
@pricedoutfornow: Don't worry, the cost of those Athlete's Village condos was only slightly more than $1 million each. Peanuts. It's a sure thing! The COV couldn't possibly lose…
“I no longer care about ownership. I’ve given up on it entirely. I want to see the Vancouver RE market turn before all my friends leave the city. The attrition is getting worse… and they’re not wrong.” « Vancouver Real Estate A Says:
March 7th, 2010 at 4:35 pm
[...] Absinthe at vancouvercondo.info 6 Mar 2010 12:36 am – [...]
A Bull’s Position – The Government Will Continue To Juice The RE Market For Homeowners, “the 70% of the population that “counts” from a political perspective.” « Vancouver Real Estate Anecdote Archive Says:
March 7th, 2010 at 4:15 pm
[...] Dr. Know at vancouvercondo.info 5 Mar 2010 5:16 pm – [...]
March 7th, 2010 at 3:50 pm
"The marginal buyers are the ones who are the least able to afford any good or service. "
Perhaps marginal in the sense that they make up a minority of buyers, but perhaps not in the number of homes bought. Drug industry types own (for operations) or buy for investment 3, 5, 12 and 20 properties. These aren't numbers I pluck out of the air but the numbers for certain individuals I hear about.
Or you can read the SCMP or other papers in HK or China and it's quite remarkable how often stories about corrupt officials contain details about the number of homes they own in Vancouver (one HK policeman had 12 properties in Vancouver).
Fat Lai didn't flee to Vancouver on a whim. Vancouver is a haven for these types of people.
March 7th, 2010 at 2:40 pm
A house is not just an investment, Mr. Milevsky cautions. Although equity in your home may increase annually, the net gain can be calculated only after totalling property taxes, repairs, landscaping, maintenance, etc. – the costs of consumption. Factor in all of these, he says, and many homes will register a negative internal rate of return. This applies, he confesses, even to his own house; although its sticker price is higher than it was when he bought it several years ago, his actual return if he sold it next month would be negative, given the other funds invested in it. As with education, other considerations – neighbourhood, schools, proximity to houses of worship – will inevitably influence decisions about buying or renting. But Mr. Milevsky argues that too many people ignore, at their peril, the implicit consumption costs of owning real estate.
March 7th, 2010 at 11:55 am
Is this true? From a link on Ben Jones'Housingbubbleblog:
"According to Businessweek Magazine, Vancouver faces $700 million in financing for the luxury condos used by Olympic athletes in February, and the city needs to sell 474 units for as much as $10 million each to recoup its lending. These condos overlooking False Creek could otherwise prove damaging to Vancouver's credit rating."
$10 million…EACH??? Is that for real? Is anyone not just a little bit terrified? If I were a Vancouver property owner I'd be scrambling to sell my house right NOW.Heck, this makes me want to leave BC!
March 7th, 2010 at 8:51 am
@rp: I believe they have to qualify for the 5 year posted rate no matter what term they take for an insured mortgage. Once they're qualified they only pay the discounted rate, but that 5 year posted rate is now the hurdle to get qualified for any CMHC insured mortgage.
March 7th, 2010 at 5:31 am
@Ulsterman:
That is completely backward. The marginal buyers are the ones who are the least able to afford any good or service. The people with the deep pockets aren't setting house prices in Vancouver (except of course for the most expensive properties) any more than Bill Gates and friends are in Seattle, which happens to be 1/2 the price of Vancouver.
March 7th, 2010 at 4:46 am
@Chilled:
The proof that actual incomes (whether reported or not) are not any higher in Vancouver than in Calgary, Toronto, or Ottawa is that rents aren't higher. For any kind of property from Surrey basement suites to Shaughnessey mansions.
Period.
March 6th, 2010 at 11:39 pm
@Chilled:
Chilled, i don't doubt the sincerity of your assertion, but no, none of my house-owning friends has the invisible tenant downstairs.
I do agree that the $7bn has to go somewhere. Maybe the drug market is like capitalism on steriods. The richest 0.1% of dealers reap 99% of the profits and maybe they are the buyers at the margin pushing up the prices. I don't know of course, but what i do know is that it cannot be average people buying average houses with their average wages.
March 6th, 2010 at 10:57 pm
I guess I would summarize it this way: "No more 1-3 year time bombs that could potentially go off while a Conservative minority government is in power. 5 year time bombs are ok, given that we expect to either have a majority or be ousted from power by 2014."
March 6th, 2010 at 10:51 pm
#109 @anonymous: So people must qualify for the 5 year posted rate (5.4%) for a term under 5 years, but they can use a discounted rate (3.75%) to qualify for a 5-year term? Weird.
March 6th, 2010 at 9:48 pm
chilled – so drugs only appeared in BC in 2003, eh?
March 6th, 2010 at 9:37 pm
@anonymous:
thanks a lot. i was looking for some hard data on that. it seems it is stricter than I thought. I wonder how serious the actual implementation will be (e.g., can there be 'smart' brokers which find a way around the rules — what we normal people call fraud)?
If people have more info about this, i would really appreciate it. It is a big deal.
March 6th, 2010 at 8:16 pm
Thanks anonymous, here's the original news link:
http://www.canadianmortgagetrends.com/canadian_mo…
So the posted 5 year rate will be used to qualify CMHC insured mortgages now. As of today that rate is 5.39% – that's a big jump – or a big drop in 'affordability' for insured mortgages. I guess we're about to find out if the market in Vancouver is driven by people stretching for insured mortgages or by people putting more than 20% down. Should be an interesting summer in the Vancouver real estate market!
March 6th, 2010 at 6:04 pm
Posted Is The New Qualifying Rate!
http://www.realestatetalks.com/viewtopic.php?f=8&…
March 6th, 2010 at 6:02 pm
Chilled I know what you mean, but I think its more than that. Other underworld cities like miami have seen real estate busts. Drug money alone will not sustain the BC property market.
March 6th, 2010 at 5:58 pm
@Clarke:
106
X Clarke Says:
March 6th, 2010 at 4:58 pm
In my own line of work, I get access to a lot of private company info including salaries. I am consistently amazed at how low the majority of salaries are in Vancouver relative to other parts of Canada. The stats I have seen on median incomes in Canada seem to bear this out as well. But, we have the most expensive real estate. Go figure.
++++++++++++++++++
What's there to figure? BC's 7 billion dollar a year drug industry has caused this mess. Where in the world do people think this money goes? Who in BC doesn't know someone who "owns" a house because of the "invisible tenant" downstairs?
March 6th, 2010 at 4:58 pm
In my own line of work, I get access to a lot of private company info including salaries. I am consistently amazed at how low the majority of salaries are in Vancouver relative to other parts of Canada. The stats I have seen on median incomes in Canada seem to bear this out as well. But, we have the most expensive real estate. Go figure.
March 6th, 2010 at 2:45 pm
That was private chef not probate. I don't cook for convicts.
March 6th, 2010 at 2:38 pm
I'd just like to take a second to say I was the only one who called it. Not only did Supra admit to sucking dick, he admitted to doing it in a professional capacity.
I friggin' told you so
other Ted, you were right. I realized I would never find what I was looking for in Vancouver. Dick sucking for me is a recreational activity. I prefer to use other skills to make money.
Since it was a while ago, I cansafely say I was an it project manger. My specialty was implementing it technology in call centers.
There are maybe 4 companies in van where I was wel suitied and none of them were hiring. While I can code it's not my primary skillsand anyway those IT geeks doing the coding have to work 80 hours a week for peanuts.
It turned out there's quite a few large projects on the east cost that were lookin for guys like me, so I did what everyne does, I went where he opportunity is ….
I'm not much for working for idiots or losers so co
ing out here offered me a chance to be my own boss with the probate chef work too.
One day Supra, you'll get tired of sucking so much dick. When you do, Vancouver will look a lot different.
March 6th, 2010 at 1:53 pm
My husband is in IT and well placed and networked. He's well known in IT in Vancouver. Unless you're a "desk diver" who's willing to work for little money (39Kish) and do unpaid overtime – or end up being the facilities guy who changes the lightbulbs, the IT jobs aren't actually "thick on the ground". Work's leaving. Plus, wages here have dropped for mid career pros in the last 10 years.
Software Engineers are slightly better placed.
March 6th, 2010 at 1:24 pm
So basically supraboy you admited that you suck dick for a living. No thanks i have my integrity. I make good money and don't have to do that. I guess scullboy was right about you.
March 6th, 2010 at 12:41 pm
@Supraboy: Either start sucking real dicks in big companies and getting in, or hump like a dog for sweatshops
How big are dicks that you keep sucking motherfucker. I guess you do a double on regular basis.