Global with Bearish Story 2.0
Another news clip from Greenhorn AKA SethM.
May favourite clip at 4:50: a bartender living in a downtown condo bought by her parents. She pays them rent. Horror, you say? Apparently not: “It’s not that simple. They’re pretty strict. They’re just like a bank.” LOL We’ll see!
October 5th, 2011 at 3:43 am 1
Old news – everyone commented on this one already…
Everyone knows about the bank of mom and dad….
That angle to the bubble has been in effect for at least 7 years now (and of course has always been around)….
Ask anyone that bought, and really push them, and they will admit that "some" of the money came from the bank of mom and dad…
I love how the supposed rite of passage into "adulthood" where one is a now a "responsible, upstanding citizen" when they buy is dependent upon mommy and daddy…
Yup, you sure are all grown up when you the umbilical cord transfers you tens of thousands of dollars to buy a place…
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October 5th, 2011 at 3:45 am 2
@Luck of the Irish: "Yup, you sure are all grown up"
Kids these days need all the help they can get
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October 5th, 2011 at 3:56 am 3
@jesse
"Kids these days need all the help they can get"
_____
Please these "kids" have been handed everything on a silver platter. That help only perpetuates their engrained sense of entitlement. Little pricks need to learn a lesson in life and finances.
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October 5th, 2011 at 4:16 am 4
@bubba: "these “kids” have been handed everything on a silver platter"
… hence their need for "all the help they can get".
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October 5th, 2011 at 4:20 am 5
Apparently not: “It’s not that simple. They’re pretty strict. They’re just like a bank.”
I think she means they're just like a landlord (actually they are landlords). There's a really big difference between a landlord and a bank – you can walk away from the former but not the latter.
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October 5th, 2011 at 4:32 am 6
What a joke. This girl has no ambition. Her profession is a bartender??? I can just see her in high school talking to the career counselor.
Counselor: What are you good at what do you like to do, so we can figure out a career for you.
Girl: I like to party and I like to be around booze. I also like the movie "Cocktail, with Tom Cruise."
Counselor: Great, we'll make you a bartender. I'll enroll you in a mixology course or you can go hang around at the Roxy.
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October 5th, 2011 at 4:57 am 7
Charismatic bartenders can make $90,000 income annually. Most of it, in tip and tax free.
The government does have a system in place to estimate income taxes on tip generated. That system is/was based on 10% tip rate. Good bartenders at good watering holes make a lot more than the declared 10% tip.
Good money until you turn 35.
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October 5th, 2011 at 5:06 am 8
I was sitting and doing my work minding my own business and started hearing my coworkers discuss real estate, and they were literally mad about whats going on.
Amazing the tides really are turning.
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October 5th, 2011 at 5:11 am 9
Coming soon to an over-inflated marker near you:
http://tinyurl.com/3thafp4
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October 5th, 2011 at 5:12 am 10
@4SlicesofCheese: What were they mad about?
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October 5th, 2011 at 5:15 am 11
Oh, someone was asking what HAM meant again.
If I recall correctly it means "Hot Asian Momma". HAWM would be "Hot Asian Westside Momma". HAWMDMS would be "Hot Asian Westside Momma Driving Mercedes SUV". HAWMDMSWSOS would be "Hot Asian Westside Momma Driving Mercedes SUV with Scratches on Side". And so on…
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October 5th, 2011 at 5:30 am 12
If that financial adviser keeps renting and saving money for larger downpayment, she'll be in real danger of being priced out forever! She should jump in with both feet and start climbing that property ladder.
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October 5th, 2011 at 5:31 am 13
Yipee!!! A buyer's market at last! Finally our wait if over bears. What a joke!
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October 5th, 2011 at 5:35 am 14
I would not take financial advice from someone who was prepared to pay 400 K for a 700 square foot condo.
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October 5th, 2011 at 5:43 am 15
So, CBC reports this today:
http://goo.gl/xZho6
yet, Larry has reported this last week:
http://goo.gl/y1O5Q
oh, yeah, and "buyer's market", that's the biggest joke I've ever heard. It won't be a "buyer's market" until prices drop 60% because then prices would be a good deal in my opinion.
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October 5th, 2011 at 6:10 am 16
@N:
"I would not take financial advice from someone who was prepared to pay 400 K for a 700 square foot condo."
Oh God, I wouldn't even do somebody like that, in fear it would lead to something more permanent.
And then one financial disaster after another.
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October 5th, 2011 at 6:18 am 17
The B.C. government has quietly removed the slogan from all its material, journalist Bob Mackin writes:
"BC No Longer Calls Self 'Best Place on Earth'
The boast is vanishing from official branding. Where did it go, and why"
http://thetyee.ca/Mediacheck/2011/10/04/BC-Best-P…
"How could a province with a misery-filled neighbourhood like the Downtown Eastside and a nation-leading child poverty rate ever call itself best-on-Earth in the first place? "
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October 5th, 2011 at 6:21 am 18
Jenny Fong is kinda hot, I would eagerly help her with some rent payments to keep old folks happy and faraway.
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October 5th, 2011 at 6:26 am 19
@Devore: Not only that, but she's "throwing money away" by not jumping into the real estate market ASAP.
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October 5th, 2011 at 6:42 am 20
@900kCrackHouse
They were saying house prices are ridiculous, they make no sense. They were not just complaining they were mad.
One is a home owner and the other is a renter, the renter mentioned hes gonna wait till the correction hits to buy.
Actually the home owner was more upset of the two, because she actually thinks about her children's future.
@patient renter
The CBC article comments are really focused on anti-foreign ownership, too bad that is not the main problem. Majority are clueless about the loose credit and financial innovation in the last decade.
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October 5th, 2011 at 6:55 am 21
@900kCrackHouse: "What were they mad about?"
That the house they think they're entitled to is out of their reach, and if they bought 5-10 years ago like their peers they wouldn't feel so inadequate.
Maybe they're also mad that the city's prices are driving away the middle class, that income disparity is increasing, and all levels of government as well as most of the populace are seemingly oblivious to the long-term damage wrought by asset price bubbles.
But probably, and sadly IMO, it's door #1.
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October 5th, 2011 at 6:57 am 22
@4SlicesofCheese: "Majority are clueless about the loose credit and financial innovation in the last decade."
They're probably also clueless that the "loose credit" and "financial innovation" extends into China as well.
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October 5th, 2011 at 7:00 am 23
@bubba:
Because the older generations have have been so prudent eh? Bidding prices right up to 11x income. Give me a break.
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October 5th, 2011 at 7:06 am 24
Bernanke: There's No Housing Bubble to Go Bust (June 2005);
http://www.washingtonpost.com/wp-dyn/content/arti…
No evidence of housing bubble: Flaherty (Sept 2011);
http://business.financialpost.com/2011/10/05/no-h…
Note for future reference.
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October 5th, 2011 at 7:10 am 25
An hour outside of Chicago…$500,000-$800,000..Brisk sales..and you jokers are still going on about the Vancouver "Bubble". Just give up already it's pathetic.
http://www.marketwatch.com/video/asset/where-smal…
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October 5th, 2011 at 7:11 am 26
http://www.youtube.com/watch?v=yXj4RpH8KfY&NR…
China could be in for a hard landing and commodities will be hit.
The consumer in China cannot keep up.
http://www.businessinsider.com/if-there8217s-anyt…
well china's record growth seems to be experiencing issues.
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October 5th, 2011 at 7:11 am 27
Because the older generations have have been so prudent eh? Bidding prices right up to 11x income. Give me a break.
________
This market has been driven by 20 somethings and 30 somethings who believe they deserve a brand new condo, townhouse or house. They do not believe in deferral of gratification, and not averse to risk from massive leverage, and believe they deserve what their parents have. They are primarily the ones buying at 11 times their income.
The rest of the buyers are either using their equity to upsize or are getting out and selling to the stupid young'ins who couldn't possible do the dirty "R" thing – renting.
Did the previous generations get to capitalize on homes at 3 times income, job growth, and salary inflation? Of course.
Does the younger generation have to subsidize the retirement of those that bought 10 and 20 years ago by buying their inflated homes? Nope.
Its a choice by the young'ins – and they choose debt and leverage. Hence, why they need to learn a lesson.
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October 5th, 2011 at 7:25 am 28
Li-Ka-Shing please come back..everything is forgiven
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October 5th, 2011 at 7:31 am 29
@Annonymous:
http://www.dailyherald.com/article/20110910/entli…
The show home is not even built yet and your playing a marketing commercial that says that 21 out of 26 are already pre-sold?!
21 re-agents desperately trying to spur sales by showing a mania… where have I heard this before?
Damn it must be slow if Chicago is trying to draw money from BC.
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October 5th, 2011 at 7:39 am 30
@bubba: Right and that's why the Vancouver West single houses are all over $2M. It's those damn ungrateful young people!
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October 5th, 2011 at 7:45 am 31
@jessie
Actually no, these are pretty level headed people. Like I said one is already a home owner and concerned about the city and her kids future. The other is the minimalist type that backpacks around the world. Has been a patient happy renter.
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October 5th, 2011 at 7:47 am 32
@bubba: Right and that’s why the Vancouver West single houses are all over $2M. It’s those damn ungrateful young people!
_______
Selling homes to eager, naive young'ins gave the baby boomers the equity needed to afford those 2 million dollar homes…
If the young'ins rented, avoided 35 year mortgages, put more than 5 percent down, paid three times their income, and avoided bidding wars, this little bubble would have burst long ago…
The realtors now have to market to teenagers to keep the ponzi scheme going, as with a 70 percent homeownership rate, the armies of stupid 20 and 30 somethings has been used up…
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October 5th, 2011 at 7:56 am 33
@bubba,
"Selling homes to eager, naive young’ins gave the baby boomers the equity needed to afford those 2 million dollar homes"
And just where do you suppose the 'young'uns' got the idea that they should go all-in on real estate just as soon as they are old enough to sign the loan?
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October 5th, 2011 at 8:04 am 34
@bubba,
“Selling homes to eager, naive young’ins gave the baby boomers the equity needed to afford those 2 million dollar homes”
And just where do you suppose the ‘young’uns’ got the idea that they should go all-in on real estate just as soon as they are old enough to sign the loan?
_____
Grow a pair and cut the umbilical cord – just because your parents told you to buy a place does not mean you have to buy a place.
People reject their parent's advice on everything from relationships, to education, career choice, child rearing, etc. If you think that their advice on one issue – real estate – is sacrosanct then you must be delusional.
Its called individual choice and responsibility – so take some responsibility for your actions if you are an adult capable buying the biggest asset of your life.
Oh, and by way, be sure blame the media, the government, the banks, the real estate industry, your neighbour, your brother-in-law, AND your parents for giving you the idea to leverage yourself to max to buy four walls.
Nothing like the abdication of personal responsibility…
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October 5th, 2011 at 8:13 am 35
Just got back from Blaine, WA. Blaine's quiet, sure, but it's a nice little American town right along the ocean looking straight back at the multi-million dollar money traps of White Rock.
Took a peek at a couple of homes there. We found this one place – a brand new SFH in a pretty little subdivision (no cookie cutters, lots of room to breathe) right along Drayton Harbor. The house itself is about a block from the water.
Not huge at 1300 sq ft, but as I say, it's brand new (with warranty) and built to Washington State's new energy standards. Two stories with two spacious bathrooms, two bedrooms upstairs, and an open floor plan between kitchen and living room that makes it seem, dare I say, big. Nice colors, granite counters, stainless-look Whirlpool appliances (including dishwasher) in the kitchen. It even had a garberator, one of the only things I miss from my days of owning. Sweet but small yard with a pond in the back. The entire neighbourhood looks like a park, with just the right amount of trees and foliage.
And a two-car attached garage too.
The asking price?
$189,000.
Will likely sell in the $170,000 range.
Need I say more?
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October 5th, 2011 at 8:14 am 36
@bubba:
Okay, blame the young’uns. I see plenty of evidence of bad behavior at every age level, but whatever.
No matter what though, intergenerational squabbling is a particularly losing battle for anyone who is over 55 today, regardless of who is actually 'right'. Whether it takes 10 or 20 years, we pesky, irresponsible, self-entitled kids will be running the show and will be carrying you as you become dependents. Well, assuming we don’t simply move away to whichever city/province/country offers a better deal.
From the immortal Breakfast Club:
http://tinyurl.com/3gt3c7h
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October 5th, 2011 at 8:15 am 37
@bubba: "Selling homes to eager, naive young’ins gave the baby boomers the equity needed to afford those 2 million dollar homes"
I know more than a few boomers with mortgages with 30 year amortizations. Are they going to be paying off their mortgages at age 85?
Saw an interesting stat, that in Vancouver in 2006 only 30% of single detached dwellings (no basement suite) had a mortgage. That number increased to 50% for multifamily (including detached with suite). Maybe the boomers were lucky/smart enough to pay off their debts by buying when prices were low.
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October 5th, 2011 at 8:32 am 38
@bubba:
Ohhhh, I get it. Leveraging yourself to the hilt as a first time buyer is bad. But Leveraging yourself to the hilt to upsize to a $2M Westside SFH is prudent. Nice logic RealPaul…err Bubba.
You know it's comically sad when Boomers put on the superiority hat. Middle Class boomers have had the easiest go of it of any generation in history….ever. It's like having to take budgeting tips from Paris Hilton.
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October 5th, 2011 at 8:40 am 39
This blog is no fun without Li-Ka Shing.
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October 5th, 2011 at 8:40 am 40
No matter what though, intergenerational squabbling is a particularly losing battle for anyone who is over 55 today, regardless of who is actually ‘right’. Whether it takes 10 or 20 years, we pesky, irresponsible, self-entitled kids will be running the show and will be carrying you as you become dependents.
_______
Look at the demographic charts – it will actually be the kids under you that run the nation….
________
Ohhhh, I get it. Leveraging yourself to the hilt as a first time buyer is bad. But Leveraging yourself to the hilt to upsize to a $2M Westside SFH is prudent. Nice logic RealPaul…err Bubba.
__________
Who said they are leveraged? Look at the mortgage stats – as I said, they have equity, and a lot more than 5% down might I add.
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October 5th, 2011 at 8:44 am 41
@bubba:
So let me get this straight, the parents are upstanding and prudent and understand that borrowing too much is bad and that buying today is foolish. And yet they still tell their kids to buy a place? What kind of a-hole parents would intentionally give their kids advice trying to bankrupt them? Or maybe they just believe the same BS they're spouting. Owning a home made them rich after all.
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October 5th, 2011 at 8:45 am 42
Sorry Folks
…..can't take the blame or credit for Post # 3 , 27, 32 or 34.
However, I do know where the cyber doppleganger lives…err is locked up and the visiting hours.
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October 5th, 2011 at 8:52 am 43
@bubba:
This is priceless stuff, keep going! It don't matter what you paid, as long as you have more than 5% down! That's just plain smart..S-M-R-T.
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October 5th, 2011 at 9:10 am 44
@patient renter:
Stats are fun. Why? Because the funny thing with stats are they must be compared to something. I constantly see this used to reflect whatever story they want you to hear.
So Month to Month drop in Median Price in West Van. So CBC compares Year over Year average price to show a 25% increase.
I've seen this so many times in the MSM. As long as you do your own research, who cares what CBC posts and how they present it?
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October 5th, 2011 at 9:20 am 45
[@work]
BTW, Okanagan RE Board Sept stats are out
http://www.omreb.com/page.php?sectionID=2
will be tonight's fun read.
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October 5th, 2011 at 9:20 am 46
I was stuck in traffic on the north shore, listening to Team 1040 and the constant on air commercials that Don Taylor spews off about Apline Credits and how you too can consolidate all those high payments into one low monthly payment… as long as you "own" your home.
So, I decided to give them a call. I spoke to a nice chap who told me about their product. They'll loan you up to your amount of equity beyond 20% up to 80% of the total value. I didn't get into what happens if you default on it… kinda curious now. But here's what really struck me – these are 2nd mortgages, HELOC, and their rates today range from 8.5-12%!!
I was blown away by that!! They have both fixed and variable and I'm thinking variable at prime plus 9% for a 2nd mortgage on your home. And people are fucking doing this? Holy shit!!
Oh, worth noting – Alpine is a broker and they place these HELOCS through mortgage providers, some out of the US, I believe.
We're so different than Americans, aren't we?
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October 5th, 2011 at 9:24 am 47
@ Gordholio
Do you or anyone else here know why the building costs in the states is so low? Or why they are so high here.
Granted its under 2000 sq ft, but with decent finishes and a garage it would cost much more here even if the land is free no?
Are building supplies getting marked up in Canada like everything else compared to the states?
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October 5th, 2011 at 9:27 am 48
@VMD:
Woah, VMD… before you do that let me tell you something to keep in mind about the interior of BC. You see, there's no bubble there because there's a shortage of land there, mmkay?
Keep that in mind.
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October 5th, 2011 at 9:37 am 49
@4SlicesofCheese:
"Do you or anyone else here know why the building costs in the states is so low? "
They're not to any significant extent.
It's what's under the building that's so much cheaper, and that's because the sale price of the house is so much cheaper, and that's because it's all people are willing to pay.
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October 5th, 2011 at 9:40 am 50
@Vansanity:
"But here’s what really struck me – these are 2nd mortgages, HELOC, and their rates today range from 8.5-12%!! "
That's the free market speaking. Without the government holding the bag banks would be charging as much for anything over 50% LTV.
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October 5th, 2011 at 9:40 am 51
You insolent renting dogs do not deserve Li Kai's cyber – presence ,let alone be drooling beneficiaries of his brilliance .
Fonzie and Richie say " Sit -on- it" and F*ck you !
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October 5th, 2011 at 9:45 am 52
@patriotz: What's the rate on a HELOC from a major bank?
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October 5th, 2011 at 10:06 am 53
Steve Jobs is gone
RIP
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October 5th, 2011 at 10:14 am 54
New Listings 279
Price Changes 119
Sold Listings 120
TI: 16694
http://www.laurenandpaul.ca
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October 5th, 2011 at 10:29 am 55
@Vansanity said: I was blown away by that!! They have both fixed and variable and I’m thinking variable at prime plus 9% for a 2nd mortgage on your home. And people are fucking doing this? Holy shit!!
<a>
They will totally do it if they've maxed out their credit elsewhere. I know of a couple of people who happily lived beyond their means through the rise in prices until they are now maxed out and are unable to deal with something so "simple" as a broken water heater. It sounds like Alpine will loan people more money they can't afford at loan shark rates and wait for them to get into more trouble until they just can't keep up anymore. It would be interesting to know if home title transfers to Alpine if you default. Please share what you learn if you inquire about what actually if a person defaults.
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October 5th, 2011 at 10:30 am 56
@Vansanity: "prime plus 9%"
That's what they call "junk", or more politically correctly, "slime". Banks do not need insurance on loans less than 80% LTV and will usually carry it on their books or securitize it (guess how?). If prices look to fall faster than 20% over the loan duration, you can bet in certain markets you 1) cannot get a loan at all 2) will be required to purchase mortgage insurance courtesy the
CMHCtaxpayer 3) will require a substantially higher downpayment or 4) will pay a higher spread.Sunshine Coast is around 15 months of inventory according to fishyre.blogspot.com. Ouch. That doesn't sound good.
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October 5th, 2011 at 10:38 am 57
I know a guy who sets these up with private equity. You get a wicked return (compared to today's rates) however you are second in line after the primary creditor. Bottom line is if owners are maxed out and house price drops, watch out! I don't invest.
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October 5th, 2011 at 10:39 am 58
@Vansanity:
"By making use of an Alpine Credits home equity loan you can deal with credit cards, store cards, and other high-interest debts. The rates on a home equity loan from Alpine Credits will most likely be less than the interest rates of credit cards – by up to 10%. That is significant savings in the long run. Additionally, one payment on a home equity loan is easier than paying several credit cards to separate lenders."
http://www.alpinecredits.ca/bc-loan/vancouver-loa…
If they can beat credit card rates by up to 10% then they're not going to charge more than 14%, sounds like a good deal.
And they recommend you use their services to take out a HELOC for vacations.
Awesome.
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October 5th, 2011 at 10:41 am 59
@Lilypad:
>>>Steve Jobs is gone
RIP<<<
Short AAPL.
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October 5th, 2011 at 10:46 am 60
[Okanagan RE prices continue to decline vs 2010]
2011-9 vs 2010-9 YOY
North Okanagan:
Residential Total: Avg -21.5% / Median -9.4% (Aug YOY was -1.3%)
Days to sale: 149 (vs 119)
Central Okanagan:
Residential Total: Avg +1.7% / Median -3.7% (Aug YOY was -2.99%)
Days to sale: 105 (vs 97)
Shuswap/Revelstoke:
Residential Total: Avg -14.1% / Median -11.8% (Aug YOY was -26.4%)
Days to sale: 132 (vs 146)
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October 5th, 2011 at 10:52 am 61
@Summer: In the event of foreclosure, bank would be first in line for funds after the sale…they are the ones that own the home after all.
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October 5th, 2011 at 10:58 am 62
@Anonymous: "bank would be first in line for funds after the sale"
Let's say there's a second high-ratio mortgage on the house. The second will be fighting tooth-and-nail for the highest price possible and that can delay a sale. Foreclosure fees, arrears, and taxes have to be paid as well. It's easier when there's equity left over, not so easy when the lenders are forced to take a haircut on the loan.
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October 5th, 2011 at 11:13 am 63
@Best place on meth:
I know, it's crazy! I pay whatever's on my credit card at the end of every month before any interest is ever charge, I use it to accumulate points.
Interest is like the plague to me. And they say paying rent is wasting money… hmm.
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October 5th, 2011 at 11:15 am 64
@Best place on meth:
Quite insensitive, but sadly very true.
In other news, my Dad's trying to dump his condo in Nanaimo (asking market rates) and hasn't seen any traction in months. Things aren't looking good there at all for sellers?. Even he's getting cynical after years of telling me to buy in.
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October 5th, 2011 at 11:18 am 65
@ADRA:
Sorry for being cheeky but if your dad could not sell his condo at 'market' price, maybe that is no longer the 'market' price. Try lowering the price and when he can place a sold sticker on the sign, he'll discover what the real 'market' price is.
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October 5th, 2011 at 11:23 am 66
@ADRA: Hopefully he is listing according to comparable sales, not comparable listings?
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October 5th, 2011 at 12:08 pm 67
wow looks like a 17,000 party soon
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October 5th, 2011 at 12:10 pm 68
Lets play the end of the month inventory game!
I will post the next three posts with the following inventories for end of Oct. Vote for the one you think it will be (but only vote for one)
17,500, 18,000, 18,500, 19000 +
This will be an interesting poll of the group.
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October 5th, 2011 at 12:11 pm 69
17500
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October 5th, 2011 at 12:11 pm 70
18000
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October 5th, 2011 at 12:11 pm 71
18500
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October 5th, 2011 at 12:12 pm 72
19000+
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October 5th, 2011 at 12:38 pm 73
TD Ups 5-year Rate. Cuts 2- & 3-Year Rates
Canadian Mortgage Trends: "TD last changed its 5-year rate two weeks ago when it dropped to 5.19%. Since then, the 5-year bond yield—which guides fixed rates most of the time—has been flat. As a result, today’s increase may surprise some.
Unfortunately, credit spreads have inflated a bit with the bond market pricing in a near-term default by Greece. In addition, investors have been demanding slightly higher returns to buy Canadian mortgage-backed securities. These realities and the related market volatility are raising lenders’ funding costs. That may be at least partly responsible for TD’s move today.
We’ll keep an eye out to see if the other Big 6 follow TD’s lead."
http://td.mediaroom.com/index.php?s=43&item=1…
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October 5th, 2011 at 12:45 pm 74
Meth
I will buy the dip, same as I have been on oil, gold, copper, etc.
Your a mess.
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October 5th, 2011 at 1:00 pm 75
@ADRA: Please keep us informed. It's anecdotes like these that help illuminate the nature of this market.
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October 5th, 2011 at 1:01 pm 76
Chinese bonds and equities are flashing warning signs that suggest the booming mainland property sector is heading for a bust – a development that would send shockwaves through financial markets worldwide.
Chinese property boom starts to wobble
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October 5th, 2011 at 1:12 pm 77
@ReadyToPop:
Stories about the looming destruction of China and their fake economy always warm my heart.
I would give them 10 thumbs up if I could.
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October 5th, 2011 at 1:14 pm 78
Wow there are a lot of haters on this site.
Angry Bulls who are watching the value of their real estate drop daily are voting down any/all of the inventory questions. I saw one go from +5 to +1.
Hilarious and reeking of desperation. Although my vote was cxl'd out by said haters I am thinking 18,500.
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October 5th, 2011 at 2:01 pm 79
Best Place on Meth.
As much as I love you…and I do
If the Chinese economy dies, so does Canada's and we all get crushed in the worst depression ever. We rely on China to sell our resources to. That's all we have.
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October 5th, 2011 at 2:15 pm 80
@Best place on meth
Just a way of tipping my hat to this city's many middle class native sons and daughters, who's dreams of owning a home were shattered and by no fault of their own, became economic roadkill. I see opportunity for them in some of these headlines even if many policy makers and politicians don't…..RTP
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October 5th, 2011 at 2:23 pm 81
@The Leak: Either way it's going to happen. Despite the popular belief, China can't actually save the world.
If we were collectively as smart as we think we are we would be planning for it now instead of boasting about Canadian immunity to the worldwide downswing.
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October 5th, 2011 at 2:27 pm 82
If Greece defaults, which many think they already have, it will have repercussions globally. What many on here should be interested in is the possible effect it will have on global credit markets. Credit markets would tighten. Bond prices would drop. Interest rates would go up.
Couple this possible scenario with China's inflation and the US's recession and we quickly see a global recession.
For Canada it means manufacturing out east will hurt as well as the resource rich provinces out west. Your proverbial double whammy. It's not a rosey picture.
What really grabbed my attention and alerted me to the problems in Europe and Asia was the activity that I observed hedge fund managers doing. Over the last 12-18 months they've been busy launching Eurozone and Asian short funds. The hedge fund managers, as per usual, saw it long before the market, media or general population.
I believe they aspire to Buffett's advice that we've seen before: Be fearful when others are greedy and greedy when others are fearful.
It is that greed and fear, the human emotion, perception, expectation which makes timing markets difficult. But when you see a bubble, all you have to do is wait for it to eventually burst. Hedge fund managers know this, that's how they do well in both bull and bear markets.
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October 5th, 2011 at 2:35 pm 83
Vansanity Says "Over the last 12-18 months they’ve been busy launching Eurozone and Asian short funds."
How we, small individual investor, can make few bucks out of it?
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October 5th, 2011 at 2:59 pm 84
@patriotz
"It’s what’s under the building that’s so much cheaper, and that’s because the sale price of the house is so much cheaper, and that’s because it’s all people are willing to pay."
Even if the land was free like I said, is it really possible to build a house in Vancouver for under 200k?
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October 5th, 2011 at 3:00 pm 85
Oops 84 was me.
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October 5th, 2011 at 3:20 pm 86
Eddie. As sad as it is, I believe you're right!
Glass-Steagal.
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October 5th, 2011 at 3:38 pm 87
@Anonymous:
Yes! You can build a 600 square foot laneway house for the bargain price of only $140,000.
http://www.straight.com/article-102875/laneway-ho…
That's 50K less than that house in Blaine… (never mind that it's half as big and you have to provide the land).
Who says Vancouver is expensive?
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October 5th, 2011 at 3:46 pm 88
Interesting Global clip. The real estate agent Lauren Goldman? talks about the decreasing sales in Vancouver West. I guess the people from China are finally beginning to realize that it's okay to low ball instead of paying an extra $300k over asking. They should also realize that it's okay to walk as there's 17000 other listings in Vancouver they can potentially purchase. It seizes to amaze me that in a turbulent global economy, why people would pay millions for a money pit that may substantially decrease in value very quickly.
As for the financial planner in the clip, she made a bigger mistake even before condo shopping. Her big mistake was moving to Vancouver. I guess she slept through her DEBT 101 course.
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October 5th, 2011 at 6:07 pm 89
@patient renter:
West Van : Median / Benchmark
2011-09: 1,830,000 / 1,716,247
2011-08: 2,090,000 / 1,760,710
2011-07: 1,865,000 / 1,729,641
2011-06: 1,797,500 / 1,793,524
2011-05: 1,910,000 / 1,713,305
2011-04: 1,910,000 / 1,637,312
September sees Median price dropping $260,000 or -12.4%
September sees Benchmark price dropping $44,463 or -2.5%
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October 5th, 2011 at 7:20 pm 90
@The Leak:
"If the Chinese economy dies, so does Canada’s and we all get crushed in the worst depression ever. We rely on China to sell our resources to. That’s all we have."
Really? I thought 70% of ALL Canadian exports (and 100% of Canada's oil exports) went to the US. How much of BC's forest products go to China versus the US?
Canada got by just fine in the past selling virtually nothing to China. Don't get me wrong, a China bust means a resource bust which means a 1980's style recession in Western Canada. But cheaper resource prices mean cheaper inputs to manufacturing in Central Canada and the US.
The whole world will have to adjust to China going off the steroids but the world will be healthier for it.
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October 12th, 2011 at 7:59 am 91
[...] SENTIMENT CHANGING? “We are here on the front line in Vancouver. It’s amazing the attitude shift in people within the last 2 months or so. People are openly talking about the market here being in a bubble. People I know who were total RE pumpers are starting to look scared. This is going to be epic.” – Drew at greaterfool.ca 4 Oct 2011 11:54pm “I was sitting and doing my work minding my own business and started hearing my coworkers discuss real estate, and they were literally mad about what’s going on. Amazing, the tides really are turning.” – 4SlicesofCheese at vancouvercondo.info October 5th, 2011 at 1:06 pm [...]
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October 12th, 2011 at 8:02 am 92
[...] SENTIMENT CHANGING? “We are here on the front line in Vancouver. It’s amazing the attitude shift in people within the last 2 months or so. People are openly talking about the market here being in a bubble. People I know who were total RE pumpers are starting to look scared. This is going to be epic.” – Drew at greaterfool.ca 4 Oct 2011 11:54pm “I was sitting and doing my work minding my own business and started hearing my coworkers discuss real estate, and they were literally mad about what’s going on. Amazing, the tides really are turning.” – 4SlicesofCheese at vancouvercondo.info October 5th, 2011 at 1:06 pm [...]
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October 12th, 2011 at 3:29 pm 93
[...] SENTIMENT CHANGING? “We are here on the front line in Vancouver. It’s amazing the attitude shift in people within the last 2 months or so. People are openly talking about the market here being in a bubble. People I know who were total RE pumpers are starting to look scared. This is going to be epic.” – Drew at greaterfool.ca 4 Oct 2011 11:54pm “I was sitting and doing my work minding my own business and started hearing my coworkers discuss real estate, and they were literally mad about what’s going on. Amazing, the tides really are turning.” – 4SlicesofCheese at vancouvercondo.info October 5th, 2011 at 1:06 pm [...]
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