Friday Free-for-all!

It’s the end of the week again, let’s do our regular weekend news round up and open topic discussion thread! Here are a few links to kick off the chat:

No housing bubble in Vancouver
Canada’s northern tiger looks very much like a bubble
Screw the scenery, I need to live
Price changes vary sharply around BC
Olympic village lures lookers with freebies
Vancouver BC the 3rd worst dressed city in the world?
CREA: housing market on solid footing
Household debt leaves little room to maneuver
Upbeat hiring climate predicted
Gen X stymied by Boomers keeping jobs

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

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Inventory

Sept 12 to 16, 2011 Richmond New Listings 197 Price Changes 78 Solds 69 Vancouver West New Listings 325 Price Changes 104 Solds 108 Vancouver East New Listings 156 Price Changes 46 Solds 58 North Vancouver New Listings 142 Price Changes 26 Solds 43 Burnaby New Listings 154 Price Changes 56 Solds 60 Coquitlam New Listings 123 Price Changes 35 Solds 47 West Vancouver New Listings 68 Price Changes 24 Solds 28 Ladner New Listings 15 Price Changes 6 Solds 6 Port Coquitlam New Listings 44 Price Changes 22 Solds 18 Maple Ridge New Listings 59 Price Changes 58 Solds 27 New Westminster New Listings 43 Price Changes 28 Solds 26 Pitt Meadows New Listings 9 Price Changes 8 Solds 3 Port Moody New Listings 31 Price Changes 11 Solds 13 Squamish New Listings 16 Price Changes 10 Solds 3… Read more »

anon2

@anonymous1: The Yukon? Why that's the CENTER OF THE UNIVERSE!

jesse

@VMD: I have been humbled with the ability of China to pour credit over markets if they foresee a slowdown. I am ascribing to Michael Pettis's view that China is in an unsustainable debt spiral, where there are no plausible investments that can repay the debt outstanding. If they "double-down" due to a housing crash or Europe-led recession, it will lead to even bigger problems down the road.

One important point is that the start of a housing crash can precede a "meltdown" by several years.

jesse

@fixie guy: "it was about his core beliefs on the nature of the business community and regulation. " Greenspan later has stated that some regulation is required, though I forget the context of his comments. It seems disingenuous and odd for him to claim free markets are best, then have a huge government-run0 liability in the form of mortgages carried at the GSEs; it seems more plausible to me he thought the moral hazard was acceptable because his macro theory — home ownership in net has goodwill — knew better than the micro was being run via free markets. Now flick the channel over to Canada and CMHC and the federal government have been embarking on similar mantra, that they want to support home ownership through access to low-interest fully-insured loans, and households have eaten them up. The one difference… Read more »

Anonymous

"With the average price of a single detached Whitehorse home hitting a new high of $427,000"

That makes the 700K east van tare down seem cheap. I bet the Whitehorse has never seen one dime from HAM. Maybe HIM? Hot Inuit Money?

Keeping An Eye On Th

Are they running out of land?

@patriotz:

No it’s in close proximity to the best place on earth.

And they are land locked.

But all kidding aside, I would imagine the local real estate mafia, oops I mean real estate board, would likely have more control of the local media, and therefore the pumping would be even more blatant and incessant than in Vancouver, where the editorial page pumps real estate usually only on Thursdays, and realtyradio98 almost every day.

Naturally, negative real interest rates stoke the flames as well.

And really how much effort and expense would there be for a Brian and a Central 1 Credit Union to pump out a report to prod the trappers and fishing guides to buy before getting priced out forever?

anonymous1

@patriotz:

Everyone wants to live in the Yukon.

VMD

[China's Property Market Cooling] – 2011-09-19 "More cities see home prices drop or remain unchanged as policies bite" "Property prices may fall in the next 12 to 18 months as the government's rigorous real estate measures continue," said Vincent Lo, chairman of Shui On Land Ltd, a major property developer in Hong Kong. "The tightening of bank loans and expanded home-purchase restrictions will see property developers face cash flow problems and this will finally prompt them to cut prices," Lo said. The government has started to prepare home-purchase restrictions in second- and third-tier cities to prevent price increases. Previously, the government restricted residents in major cities, such as Beijing and Shanghai, from buying second or third homes. Homebuyers were also required to pay higher down payments for mortgages. Property taxes have been levied in Chongqing and Shanghai. "Qin Hong, deputy… Read more »

patriotz

@Devore:

Depends. For another example, Canada has been very effective in reducing cigarette smoking.

Devore

@patriotz: I'm not qualifying the act or the intended effect, just saying they tend to be pretty ineffective at changing behaviour as used.

patriotz

Yukon home prices reach record levels

With the average price of a single detached Whitehorse home hitting a new high of $427,000 in the second quarter, it's little wonder affordable housing is a key Yukon election issue.

Figures released by the Yukon Bureau of Statistics this week show housing prices have been steadily climbing since 2005 when the average price for a single detached home was only $200,000.

Are they running out of land?

Key election issue eh? Do you think any party would propose something that would actually bring prices down, like a speculation tax?

patriotz

@Devore:

"Or maybe just a case of tragically failed social engineering (is there any other kind?)"

Well mass vaccination has turned out pretty well, although people like Michelle Bachmann seem to be slow to catch on.

In general, people only regard something as "social engineering" if they don't like it. For example, hardly anyone in the US or Canada regards government road building programs as social engineering. But far more people apply the term to public transit. Or, many people label efforts to compensate for aftereffects of slavery in the US as social engineering, but they seldom apply the term to slavery itself. Ditto current programs in Canada for aboriginals versus the original Indian Act.

zrh2yvr

@RippedtoShit:

In Oct 2008 – approx 1,000 (think max was 995)

In Jan 2009 after y/e expirarions – 600

In May 2010 – 750.

So – Looks like 1,000 is the number to beat. Not likely this year but perhaps in Spring if this year end does not go well.

zrh2yvr

@Bally:

Not sure we should say sales are up currently over last year. Over past 4 weeks, we're running approx 5% below last year on sales and 20% up on listings volume. Not quite a trend yet but we'll see where September takes us.

zrh2yvr

@jesse:

Partially true. North Van, Richmond have shown decreases since June while their MOI have gotten worse. Richmond has been bad for months but North Van has gone from very low to a balanced situation. Areas with biggest increases in Detached inventory are:

Van West/ Van East / White Rock / Burnaby – With the exception of White Rock -all of these are up more than 20% from June through September

zrh2yvr

@Bally:

It is higher than normal with only 2008 having a higher rate in the past 10 years.

bubba

You know the end is high .

Asian gal I know from Hong Kong has had enough of Richmond…family looking to move to Okanagan

Just got back from White Rock..lots of same…more Asians realize White Rock is best side of the tunnel.

bubba

@patriotz:

You mean Translink would have a " Tax sale " to collect their portion?

Any legislation you are aware of ?

I am not sure they would have any recourse

Thanks.

Devore

@jesse:

The data they cited were showing economic results of mostly owner-occupied neighbourhoods were favourable to those with a high rate of renting. So to improve the plight of renters, why not make them owners?

Classic case of cart before horse. Pretending to live like a wealthy household does not make you one, it will only make you poorer. Home ownership will not change your financial circumstances. This can only happen by increasing your income or decreasing your expenses.

Or maybe just a case of tragically failed social engineering (is there any other kind?)

patriotz

@bubba:

"What if one does not pay that Translink portion of the property tax, what would the consequences be ?"

Same as with the city or school board portions. That's why it's called a tax.

fixie guy

@107 jesse: 🙂 The big dichotomy, whether it's better to ascribe undesirable behaviour to a person's deficiencies or malfeasance. At least the latter's volitional.

Greenspan may have been naive, but his own latter admissions suggest it was about his core beliefs on the nature of the business community and regulation. Some the more fiscal-religious were literally advocating that in an ideal unregulated market malfeasance was almost mathematically impossible because the market would drive wrongdoers out. None of them thought that entire markets could follow if the money on the line was big enough. Some would argue it was their 'fiduciary duty' to get on the gravy train. That's an even scarier possibility.

bubba

Rhetorical question:

On one's annual property tax , there are Translink charges.

What if one does not pay that Translink portion of the property tax, what would the consequences be ?

jesse

@fixie guy: I agree re financial corruption but Greenspan seemed to believe his own mantra about home ownership (improper risk allocation in mortgages). I could believe that alone would justify the means he advocated.

I would almost prefer he saw the endgame of feeding the finance industry trough and used home ownership as a guise because it means the Beltway wasn't fooled by his cover story. I think the truth is more disturbing, that he was pedagogical and resistant to alternate viewpoints due to his influnces in his youth. That he and his flawed philosophies were allowed so much rope speaks to something far more sad about America's political discourse.

fixie guy

@ jesse: That reasoning has a mortal flaw. Greenspan was local, the bubble was global: http://en.wikipedia.org/wiki/Real_estate_bubble#R… Were all the result of similar humanitarian policies? Independent, unrelated and coincidental? Or reactive policies based on the belief it enhanced global competitiveness? The US fed was stimulating the largest growth area of their economy, the financial sector. The regulatory structure in the US was controlled by members culled from that industry who would return to it. It's been described as a revolving door. You can gauge the extent to which benefiting the poor and disadvantaged was the prime goal by examining where so many fingers immediately pointed (especially on the Right who authored this bubble) when it all went to shit: the defaulting poor and disadvantaged. I don't think it's a coincidence one of the last countries still pumping real estate – Canada… Read more »

jesse

@fixie guy: That is really at the heart of what drove this, IMO. Greenspan phrased it differently, that lenders were mispricing risk because the data he had showed that owners were on average less risky than the borrowing rates indicated. Why was this he argued? One, ownership reduces credit risk due to hand wavy pride and responsibility, two, this was a case of the micro not getting the macro (sounds familiar to what many think Keynes stated). Ergo rising house prices and GDP growth were justified. He may have thought that incomes would eventually rise with a lag to justify the higher prices, though I doubt it. Where Greenspan erred was failing to link prices and rents/incomes, and accounting that an asset bubble was another potential logical outcome to his advocated policies. An absolutely horrible risk manager and history has… Read more »