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Friday Free-for-all

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251 Comments

It’s time for that end of the week tradition, the VCI Friday Free-for-all! This is our regular news round up and open topic economic discussion thread, here are a few links to kick off the weekend:

–Six questions to ask before buying
–Putting listings on the MLS for a fee
–Opinion on the Olympic Village deal ideas
–Concrete condo market ‘relatively strong’
–The Mr. T Gold Indicator – back in action
–Victoria numbers lag
–Crying Irish: bought for €525k, now selling at €190k
–How US foreclosure mess got so bad
–Wall Street blames owners for foreclosure mess
–

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

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crabman

@jesse: Well said. In a democracy, who is ultimately responsible? Politicians do things that win votes. If the voters were to demand an end to CMHC, it would happen. Unfortunately, most people are under the impression that the CMHC is a good thing. And if a politician were to take the time to explain why it does more harm than good, most wouldn't pay attention long enough to understand the issue. So instead, they just spend their time slinging mud at each other.

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fixie guy

"The faster people understand this the better. Blame CMHC…"

Bull. Shit. Flooding a single asset class with unprecedented liquidity has known and predictable repercussions. That's exactly the route taken by Harper's 'action plan', demonstrating foreknowledge of the consequences and intent. Whitewashing that is disingenuous, and presumptuous regarding the intent of the program's users across the country. Not all buyers are Vancouver flippers.

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real_professional

Bank of America – Merrill Lynch (Published October 15th 2010)

Canadian economic forecasts: Line: Housing Investment q/q %

09Q3 9.1

09Q4 26.3

10Q1 23.6

10Q2 17.0

10Q3 8.0

———- forecast

10Q4 -1.0

11Q1 -6.0

11Q2 -12.0

11Q3 -15.0

11Q4 -8.0

In other words, the bounce is done, there is no upside left in real-estate. If you missed the boat don't be stupid and jump in. Your only decision should be is renting cheaper than owning… answer Yes, currently.

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jesse

@patriotz: "They haven’t raised prices with bidding wars. The buyers have."

The faster people understand this the better. Blame CMHC, CREA, Realtors, and mortgage lenders all you want. The buck stops with the guy/gal who signs on the dotted line at the bottom of the contract.

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patriotz

@NO – LYMPICS:

Realtors have had it too good for too long. Don’t tell me they haven’t raised prices with bidding wars.

They haven’t raised prices with bidding wars.

The buyers have. Nobody has to buy.

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VHB

This ain't 2008, but it also ain't 2001-2007; 2009 either

Here are total REBGV sales and listings for the last 9 years for October, taken from their monthly reports.

month sales listings

Oct-01 2379 3086

Oct-02 2866 3535

Oct-03 3765 4200

Oct-04 2735 3703

Oct-05 3099 4041

Oct-06 2722 4862

Oct-07 3028 4819

Oct-08 1364 4867

Oct-09 3704 4977

9 year avg 2851 4232

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VHB

October Projections for month totals

Days elapsed so far 10

Days remaining 10

Average Sales this month 113

Average Listings this month 207

Projected sell/list 54.6%

SALES

Projected month end total 2256 +/- 173

95% Conf Interval lower bound 2083

95% Conf Interval upper bound 2429

NEW LISTINGS

Projected month end total 4132 +/- 242

95% Conf Interval lower bound 3890

95% Conf Interval upper bound 4374

MONTHS OF INVENTORY

Inventory as of September 30th 15401

MoI at this sales pace 6.83

Note: This is a simple linear projection of month end totals.

This provides the answer to the question

"What will month end totals be, if things continue

on the same pace we've seen so far this month?"

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NO - LYMPICS

Spain Is On The Brink Of Financial Collapse Because Nobody Pays Taxes http://www.businessinsider.com/no-wonder-spain-is… For Spain, such tax shenanigans center around the property market where reportedly half of landlords evade taxes. Bloomberg: Owners are asking for payment in cash from tenants to avoid tax on 2.5 billion euros ($3.5 billion) of earnings annually, the Gestha union of tax inspectors estimates. An increase in rental properties nationwide hasn’t generated any more tax revenue. The Spanish government, seeking to pull the country out of its deepest recession in 60 years, needs all the money it can get right now. The slump was triggered by a crash in the housing market and has left Spain with the highest budget deficit since at least 1980. Taxes go unpaid on income equal to about a quarter of gross domestic product, Gestha estimates. … Encinar, whose company… Read more »

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BC Bear

@ReadyToPop:

Some may have missed the boat. Thats a fact. But just because you've missed the boat, don't go on a sinking ship.

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NO - LYMPICS

239 realpaul

True re: the details, but the CREA and the FEDS

Obviously, the CREA isn't structured for democracy amongst its members, and the FEDS simply want to give the appearnce of action.

Anyway, you said previously how one should deal with reatlors…and people should tell the realtors THEIR terms or F- OFF. Realtors have had it too good for too long. Don't tell me they haven't raised prices with bidding wars.

A friend who sold recently told me the realtor cut $5000 off their commission to get the deal done.

EVERYTHING is negotiable, and the realtors are gonne hit the real world big time.

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ReadyToPop

It’s such a bitter taste of defeat as I stare out my window each morning that I leave the blind down continually….

Down at heart in docklands

I guess missing the ride up can be as bad as watching it fall….RTP

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NO - LYMPICS

Saw on the news another Indo Canadian "Known to police " got whacked.

It is quite a tragedy that many of the current generation have gotten sucked into a lifestyle which disrespects their roots.

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realpaul

It appears that the CREA deal is not going to make anybody happy. I think the public should have been given full access to the MLS and agents should beg for a listing…making promises that they will actually do something for the commission they seek. This deal stinks to high heaven and the Competition Bureau has done the public a disservive to everyone by negotiating without public hearings to really clear the air…..what is this …some fucking third world shithole? They had these rats in their sights and they've let them squirm out…..it happens in other jurisdictions when corruption is afoot…..have the third world practices of the immigrants infected our pristine landscape?

http://www.theglobeandmail.com/report-on-business…

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jesse

@China Friend: "Chinese buy house with cash only"

Hehe. Anybody who reads Chinese knows that's a load of crock — mortgage ads from banks written in Chinese are everywhere. Banks employ a staff mortgage brokers who speak both Mandarin and Cantonese.

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China Friend

@Best place on meth:

Chinese buy house with cash only

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Best place on meth

>>>What also used to be a common cultural trait was an aversion to debt. As my father would say – if you can’t buy it with cash you can’t afford it.

But more commonly now you are finding Indians – particularly in the real estate “industry” – leveraging themselves heavily.<<<

They've been infected by the same mental illness that has turned this city into one big psycho ward.

It's extremely sad to see a segment of society that used to be so sensible and prudent become just like everyone else here.

Diseased.

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NO - LYMPICS

GOOD Olympic news:

The RCMP went under budget re Olympic security…spent only $ 520 MILLION of the $550 MILLION budgetted

( I guess donuts were on sale )

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NO - LYMPICS

219 realpaul

Re Libs and Campbell….since WAC Bennett,NO Bc Premier has lasted more than 3 terms.

Bennett left on more of a high note on his terms. That Campbell

can't read history is a sign of his Napoleon/Caesar complex.

I think he's left it so long his party will go down with him. No break in the ranks yet.

At least the NDP is smart enough to know when to hold them and know when to fold them.

Patriotz all-time favourite Premier Vander Zalm, has a funny way of giving stagnant messes an enema,in a non partisan sense.

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NO - LYMPICS

225 real_professional Well as a first generation Canadian, I was regaled with stories of DP's (displaced person )after WWII coming to Canda with nothing. One family ( of 2 parents and 8 kids)bought a house, worked the fields and had it paid off in ONE year. The European culture has evolved into a bunch of spoiled brats, who want to move out of the home once of legal age, presume a 5-6 figure wage is a right, and that a new a car and house of condo is a given. The South Asian culture is very clever…a house is built,they employ many of their countrymen multiple contributors to the mortgage, their individual tax bracket is likely low, they mortgae is paid off more quickly and they make big time advantage of the capital gains. The Mennonite community did exactly that… Read more »

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patriotz

@Anonymous:

If someone is legally a resident for Canadian tax purposes they are considered a resident for property ownership. It doesn't matter whether they actually live in the country or not. You do not become a non-resident for tax purposes just because you are living outside the country.

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Happy Renting

@Anonymous: Your gut has way more nerve endings than your brain, so you should go with what your gut tells you.

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realpaul

#226 VSM …you go to Alpine Credit etc for the negative equity portion of the 1st mortgage and take out a second mortgage. Make sure you put a layer of duct tape over your asshole before you go….the second tier guys are not going to talk terms. Going through the same process with a mortgage broker will just end up in the same position except now you will owe the mortgage broker a few grand for 'fixing you up'.

Under the Bank Act a chartered bank cannot finance you on zero equity….which is why they created the HELOC….but….if your deep underwater you may not qualify for a re newed HELOC because the repayment terms are not included in the mortgage doc. Thats why the second and third mortgage market exists.

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Anonymous

@Drachen:

"https://www.landcor.com/market/reports/Metro_Vancouver_2010_Report.pdf

"977 residential properties in Vancouver were owned by Asian residents at the beginning of 2010."

If you think that has ANY impact on the market then there are sacks of hammers out there with things to teach you"

Does that chart look like reality to you? According to that chart there are ~4000 properties in Vancouver owned by foreign residents or a bit less than 4% of the total. Either my gut is WAY OFF or that is just wrong. What does everyone else think? Based on the owners I know in my building 25% are full time non residents (non Canadians) stopping in for a month or two on occasion and another 30% are dual citizens currently living here. I admit this is a very small sample and I'd love to here other opinions.

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jesse

@McLovin: “So if they are 5% of all BC Real Estate but 60% + in one very small area could this lead to prices staying firm?”

If prices “stay firm” in a westside neighbourhood and drop 50% in the adjoining one, I’d be very surprised.

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NO - LYMPICS

225 real_professional

In my next life, I want to come back as an East Indian…"South Asian"….I know a lot of them, our kids hang out with them… cool,people.

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