Friday Free-for-all on the new site!

Hello everybody, it’s Friday and you know what that means.. It’s Free-for-all time, our end of the week news roundup and open topic discussion thread.

Here are a few recent stories to kick off the chat:

BOC warns of ‘debt shock’ if house prices drop
Inventory graph: growth slowing but still steep
RRSP contributions shrink to 1970s levels
Mortgage fraud blooming in Canada
Our debt vs. pre-meltdown levels in USA
Housing Collapse in mississauga. literally.
Shill article linked by Forbes gone from Vancouver Sun?
First time buyer bonus to make a difference in suburbs

If you haven’t been here for a few days you’ll notice some changes. We’ve done a full site overhaul and upgrades and that just might mean somethings aren’t fully working yet.

Please post any issues in the comment section.  We can’t promise they’ll all be addressed, but we’ve been pretty good about responding to requests so far.

A few new things of note:

Formatting Numbers:

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This new comment workaround and preview system might help when you’re posting number data.

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That’s about it for now, let’s get on with the conversation.

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

 

Update: Patriotz linked to this image of the Macleans March 5th cover, it’s a doozy:

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oneangryslav
Member
oneangryslav
3 years 11 months ago

Just a note regarding the real-estate media complex. I accompanied my significant other to the Carol Burnett appearance at the Orpheum Theatre last weekend. I was absolutely stunned by the ovation received by the two co-hosts–Global TV anchors, whose names I didn’t catch. After a brief introduction it was they who would go on to introduce Carol to her adoring fans.

These Global TV anchors were greeted like rock stars!

Member
3 years 11 months ago

I’ve had enough of waiting for the Canadian RE market to correct, hell will freeze over before I buy at these multiples. I’m seriously considering relocating to Pheonix (cheap, warm, hub) or Hawaii (not so cheap, warm, closer to Asia). Florida and LV aren’t really my scene.

Can anyone recommend some relatively unbiased blogs that publish regular data for those markets, AZ and HI?

patriotz
Member
3 years 11 months ago

Hat tip to VW at HHV:

http://www.pdfmagazines.org/magazines/3966-macleans-05-march-2012.html

Just this time I think the magazine cover indicator is not contrarian. :-)

Member
Patiently Waiting
3 years 11 months ago

Yet another story of doom and gloom:

http://www.cbc.ca/news/canada/story/2012/02/23/household-debt-house-prices.html

“Canadians are relying too much on home equity loans for their borrowing, the Bank of Canada warned Thursday.

In four research papers looking at trends over the last dozen years, the central bank says Canadians are increasingly exposed to a correction in house prices because they have increased their borrowing amid a sharp increase in house prices — and equity.”

patriotz
Member
3 years 11 months ago

@Patiently Waiting:
“And debt to household equity has risen as well even as home prices have soared”

This is the key sentence. Even with a record increase in house prices, equity has declined relative to debt, i.e. debt has been increasing even faster than house prices. Which of course means it’s a Ponzi scheme.

Compare to the US in 2007:

http://www.calculatedriskblog.com/2007/06/percentage-of-household-equity-falls-to.html

“Despite the significant increase in valuations in recent years, the percent equity has been dropping – and is now at an all time low of 52.7%.”

Member
3 years 11 months ago

PLZ vote this down, just making sure my user is working and still active.

Member
vangrl
3 years 11 months ago

“Carney issues fresh warning on debt ”

this article in the Globe and Mail has almost 300 comments, all comments are basically trashing Carney for yet another warning without actually doing something. Almost every other article in every other publication regarding our debt issues have common comments.

Does he or his P.A’s not read these at all? is everybody wrong in thinking that he should do something NOW to curb the spending?

Don Lapre
Member
Don Lapre
3 years 11 months ago

Global TV is absolutely horrendous. From Michael Levy, to Michael Campbell to the anchors themselves; it is “The Province” of newscasts.

Guest
N
3 years 11 months ago

@patriotz:

Ah, good old media, making it worse on the way up, and making it worse on the way down.

Self fulfilling prophesy of the week: It’s officially time to panic.

People who didn’t really believe in the power of the market and could see no reason why prices would ever go down, forgot about the impact of headlines like these (and failed to factor in the impact of opposite headlines on the way up).

Guest
Groggins
3 years 11 months ago

@patriotz: Whoa! We’ve seen a few bubble related covers, but that one takes the cake.

patriotz
Member
3 years 11 months ago

@vangrl:
“is everybody wrong in thinking that he should do something NOW to curb the spending”

Carney cannot do anything about household debt without putting more industrial workers out of work, mostly in Central Canada, due to a higher CAD.

Flaherty and Harper can.

Guest
vanpire
3 years 11 months ago

@oneangryslav:
They ARE the equivalent of rock stars around here. That’s all we’ve got in this backwater shitty town after all… Global’s shills are Vancouver’s idols. Can’t get more pathetic than that…

Guest
vanpire
3 years 11 months ago

@patriotz:

Hello, didn’t anyone notice? That article is about Canada and we are Vancouver ,/b> so, obviously, it is not going to happen here. Duh…

Guest
vanpire
3 years 11 months ago

@vanpire:

Ooops! … I mean, Ooops!

VMD
Member
3 years 11 months ago

@patriotz:

Mclean’s trying to match Canadian Business magazine in dramatic cover pages lol.

VMD
Member
3 years 11 months ago

@patriotz:

It seems like Mclean’s trying to match Canadian Business magazine in dramatic cover pages lol.

http://alturl.com/zkwe3

Guest
fixie guy
3 years 11 months ago

@6 vangrl: The feds don’t give a shit about you or me and follow their own agenda. They’re 100% behind corporate interests, domestic and foreign, to the point of trashing democracy for the benefit of Hollywood:

http://www.michaelgeist.ca/content/view/6335/125/

Canada’s spineless corporate Taliban. For all his countless faults even Chretien had the balls to tell the American entertainment industry to screw themselves.

Guest
3 years 11 months ago
Guest
3 years 11 months ago

(A heads-up to the bear gods: I had a comment get stuck in moderation yesterday, probably due to the number of links in it; I’ve reposted it on this thread and now it’s stuck here.)

Guest
Anonymous
3 years 11 months ago

Regard the $10,000 “tax credit” for 1st home buyer.

“Tax Credit” is used here to mislead home buyers to think they were to get a $10,000 chq in the mail from the Gov.

The correct tax term for this is “Tax Deductions” as it just reduces one’s tax income.

http://www.kiplinger.com/columns/ask/archive/2007/q0319.htm

This is Accounting 101, yet Finance Minster couldn’t get it right.

Member
mflat
3 years 11 months ago

You can’t make this sh*t up. I posted a week ago about the insanity of the East Vancouver market giving the example of a builder who converted a 33×120 lot into a house with a strata titled main floor and basement, as well as a lane house. The main house is up for sale, with the lane house still to be completed.

Well, the basement of the main house has sold.

Member
Best place on meth
3 years 11 months ago

@Anonymous:

A $10k tax credit actually amounts to about $2500 less tax paid doesn’t it?

Guest
Anonymous
3 years 11 months ago

No, Only BC rate is apply. It you are at the lowest rate in Province tax, it is about $500

Guest
FiveNeatGuys
3 years 11 months ago

@Many Franks:

Wolf!

WOLF!

WOOLLFF!!

I think everybody is just used to these warnings so they disregard them now. Kinda like the boy who cried wolf.. what happens at the end of that story again?

Oh yeah, everyone gets devoured by the warning they’ve learned to ignore.

Member
Not much of a name...
3 years 11 months ago

@Anonymous: It’s interesting that the gov’t in their own information handouts use the term “bonus” more often than “tax credit”.

http://www.bcbudget.gov.bc.ca/2012/homebuyers/2012_First_Time_Home_Buyers_Fact_Sheet.pdf

I’ve also read somewhere that the gov’t has estimated that this program will cost about $24M. That sounds more like people will be receiving a cheque up to $10k rather than a tax credit with a value of $500.

But again, who knows, by the time anyone gets to see any of this credit, it will be past the election next year anyway. Hmmmm….pulling the wool over the eyes of prospective buyers me thinks…

Guest
vanpire
3 years 11 months ago

@Anonymous:
“Regard the $10,000 “tax credit” for 1st home buyer.

“Tax Credit” is used here to mislead home buyers to think they were to get a $10,000 chq in the mail from the Gov.

The correct tax term for this is “Tax Deductions” as it just reduces one’s tax income.

http://www.kiplinger.com/columns/ask/archive/2007/q0319.htm

This is Accounting 101, yet Finance Minster couldn’t get it righ”

I believe that it also says it’s “refundable” and “temporary” which means it has to be repaid kinda like the RRSPs you can use for your downpayment, no?

Guest
Sheesh
3 years 11 months ago

@mflat: Oh, my god. The “offered” price (I love that, “No, it’s not ‘for sale!’ How gauche. We’re generously offering it to you because we’re nice people!”) was $589,000. I used to think prices would fall by maybe 20%. But when people are deluded enough to pay the better half of a million dollars for a basement in East Van… wow. How could anyone not see that that place is worth $250,000, max? Maybe $300,000 if you want to add a ‘you-get-to-live-in-Lotusland’ premium. I don’t even know what to think anymore. It’s hard to see any scenario in which this… Read more »

Guest
N
3 years 11 months ago

@Sheesh:

“How could anyone not see that that place is worth $250,000, max? Maybe $300,000 if you want to add a ‘you-get-to-live-in-Lotusland’ premium.”

300,000 for a basement suite, a basement suite!, in East Van is still totally and completely insane. If the basement suite is worth $300,000, what is the whole house and the associated land worth?

If somebody really did pay nearly $600,000 for a basement suite in East Van, I think they should be awarded the official greatest fool price.

Member
Best place on meth
3 years 11 months ago

How’s this for lofty expectations dashed?

1543 Frances St. listed Oct 18 for $999K

Reduced Dec 8 to $898K

Sold Feb 24 for $790K

21% off original asking price.

Member
Patiently Waiting
3 years 11 months ago

This story reeks of someone who reached the end of his home equity, got really hungry, and panicked. I pretty much guarantee you that seasoned shoplifters don’t act like this guy:

http://www.vancouversun.com/news/Shoplifter+returns+crime+scene+keys+caught+after+jump+into+ocean+police/6200133/story.html

Speaking of reeking, ewww he jumped into False Creek.

Member
Devore
3 years 11 months ago

@Patiently Waiting: I don’t know what it smells like, but that IS bizarre. Maybe it’s a basement dweller, and the magic mould got to him?

Guest
Sheesh
3 years 11 months ago

@N: I agree with you. I’m not saying I personally would pay $250,000 to $300,000 for a basement (sorry, garden) suite. But have you checked out the rental market lately? There is tons of crap, and it is expensive.

That place is nice, even though it is a basement, and would easily fetch $1,800/month. I’m not a numbers cruncher and am totally just throwing out an estimate, but I think that would support about a $250,000 purchase price.

Member
rksleung
3 years 11 months ago

Don’t think the market is as bad as the Sales/List illustrated.
Here is the stats for 2012 Jan.

Area
Total Sold
Sold above or at Listing
Percentage

VBE19210.5%
VBN631015.9
VBS53611.3
VCQ1462114.4
VNV1112118.9
VNW25416
VPM4149.8
VRI203199.4
VVE1743419.5
VVW2173415.7
VWV11975.9

jesse
Member
3 years 11 months ago

@vangrl: “is everybody wrong in thinking that he should do something NOW to curb the spending?”

I think all remarks should be focused on the PMO and Finance Department. Carney has marching orders regarding CPI price stability and can only advise on fiscal policy. Right now the economy is hurting the wrong people but in terms of price stability that doesn’t matter.

Member
rksleung
3 years 11 months ago

@rksleung:
Sorry. Bad format. Table does not work in this forum.

Guest
Laibach
3 years 11 months ago

@Sheesh:

…place is worth $250,000, max? Maybe $300,000 if you want to add a ‘you-get-to-live-in-Lotusland’ premium.

I suppose you mean the whole house including this basement, not just the basement is worth $250,000, max. Even that much is questionable given the house age, look and the neighborhood.

Member
space889
3 years 11 months ago

New taxes/road tolls considered for Translink –
http://www.vancouversun.com/technology/EXCLUSIVE+Road+tolls+recommended+Metro+Vancouver/6201728/story.html

I can’t find the table they had in the printed newspaper version that listed all the potential options.

One option listed with High probability is charging $0.67/km drived on all roads in metro Vancouver. I’m not sure how they can do that without using some kind of transponder on each car. Or maybe calculated the total km drived on your car every time you renew your insurance?

Guest
Groggins
3 years 11 months ago

@space889: That’s ¢0.67 per km right? No way the could charge 67¢ per km.

Guest
OMG
3 years 11 months ago

@Laibach: This cracks me up, it’s obviously a brilliant move by the developer if they got it sold. The went all white and staged it well so the photos don’t look like a dark basement, but it doesn’t change the fact that it’s partly below ground and you’ve got somebody walking around over your head. I hope they put extra soundproofing in the floors upstairs. Look at the second bedroom shot, the window looks out on a grungy fence and stucco wall of the neighbors house. At least if you rent a place like this it’s easy to move when… Read more »

Guest
Laibach
3 years 11 months ago
Member
Best place on meth
3 years 11 months ago

@space889:

>>>One option listed with High probability is charging $0.67/km drived on all roads in metro Vancouver.<<<

This will never work. Why should someone driving a Smart Car pay the same tax per km as someone driving an F350?

This is why we have gas taxes, the more you consume the more tax you pay.

Member
/dev/null
3 years 11 months ago

@vanpire: I believe that it also says it’s “refundable” and “temporary” which means it has to be repaid kinda like the RRSPs you can use for your downpayment, no?

I’m not an expert but I think a refundable tax credit means that it can reduce your taxes below zero, whereas a non-refundable means it can reduce your taxes but only down to zero. So you could potentially get a refund from this credit but only if you were hardly paying any tax to begin with. Otherwise it just lowers your taxable income by $10k. I think…

Guest
OMG
3 years 11 months ago

@rksleung: I’m going to try to reformat your data using the pre tag, does this work: Area Total Sold at/over list percent VBE. 19. 2. 10.5% VBN. 63. 10. 15.9 VBS. 536. 11. .3 VCQ. 146. 21. 14.4 VNV. 111. 21. 18.9 VNW. 25. 4. 16 VPM. 41. 4. 9.8 VRI. 203. 19. 9.4 VVE. 174. 34. 19.5 VVW. 217. 34. 15.7 VWV. 119. 7. 5.9 I couldn’t tell where the breaks in your numbers were, so apologies if the is wrong.

Guest
Anonymous
3 years 11 months ago

@vanpire:

I think you would have a -ve Net Income at line 236 on the tax return. You can get carry backward to get a refund from tax paid previously.

So the person will basically has little to no income for the year and also buying a house. Being unemployed is the best tax planning opportunity.

The BC gov together with Vancouver Sun get a few suckers this year.

Member
3 years 11 months ago

@Laibach:

Hah! I swear the exact same house, same crappy stucco, foundation problems, a big sewer access hatch in the middle of the yard, serious drainage issues and landscaping that all mysteriously died after 6 months (including about 90% of the lawn) sold near me for 850k… for the basement. The two units sharing the upper floors both went for over a million each. That was just before the 2008 shakeup started.

Guest
Seymour Data
3 years 11 months ago

@rksleung: Actually these are pretty bearish numbers. I’ve posted historical numbers here a few times and when the market was hot it was running at over 30% sold at or above list. In 08/09 when prices were declining it was running below 10%. I haven’t checked your data but if these numbers are correct the January total is running at 13.8%. West Van is very low so I’d expect price decreases there. VBE 19 2 10.5% VBN 63 10 15.9 VBS 53 6 11.3 VCQ 146 21 14.4 VNV 111 21 18.9 VNW 25 4 16 VPM 41 4 9.8… Read more »

Member
3 years 11 months ago

Inventory of Attached in Van-West by Area including MOI – Sorry for the bad formatting. This is sorted by highest MOI. Interesting to note that University is looking bad – similar to some stories posted in past few days. Also – Coal Harbour continues to struggle. Area MOI Dunbar 21.2 Cambine 13.1 Oak 13.0 S. Gran. 13.0 Univ. 10.8 Kerris. 8.9 F.Creek 8.5 Quil. 7.1 S. Camb. 6.5 West End 6.1 Downtown 6.0 Yaletown 5.5 Marpole 5.5 Kits 5.3 SW Mar. 5.2 Fairview 4.8 PG 4.0 Shaun. 3.6 Southl. 3.3 Mount P 3.0 Cambie 2.7 Also – This is by… Read more »

Member
3 years 11 months ago

“Cambine” should actually say Coal Harbour.

Guest
VMD@work
3 years 11 months ago

@ZRH2YVR:
Nice work!
The MOI-by-price is also for attached/condos right?

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