Friday Free-for-all!

It’s the end of another work week and that means it’s time for our regular end of the week news round-up and open topic discussion thread. Here are a few recent links to kick off the chat:

‘House of cards’will implode
Inventory squeeks back to record level
May sales to list so far is 41%
CEO welcomes Vancouver price drop
Are Canadians ready for higher rates?
Condos need depreciation reports
Rennie wants to see numbers
20% drop in Toronto condo sales
Canadian Mortgage Market Primer
No US style 30 year mortgage
Money contracts in China
How to format a link on VCI

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

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george
Guest
george
“We now live in a world where deflation has become public enemy number one. In this current economic environment, governments seek a condition of perpetual inflation in order to maintain the illusion of prosperity in the developed world. But in reality, deflation is the free-market approach to rectify a secular period of superfluous money supply growth, debt accumulation and asset price appreciation.” “The plain truth is that the current debt levels, carried by the developed world, demand a period of massive deleveraging to occur. A healthy and cathartic period of deflation is needed; where asset prices fall, money supply shrinks and debt levels are reduced to a level that can be supported by the free market. This is the only viable answer for various nations struggling with solvency. However, the return journey from rampant inflation and asset bubbles always carries… Read more »
Contrarian Lemming
Guest
Contrarian Lemming

From 24hrs:

“When you look at the region as a whole, there is a still a lot of real estate on the market that is within the reach of average working people,” said Rennie. “The upper end of the market has simply skewed the numbers to make Metro Vancouver look more unaffordable than the sound bites want you to believe.”

Rennie said the amount of clear title home ownership by 55-74 year olds in Metro Vancouver is valued at $88 billion (113,000 homes, average $777K). He claims a lot of that equity is now being used to help the children of those homeowners to get into Vancouver’s housing market.

Uh huh, but if real estate is still affordable, why do so many people need to turn to their parents for help buying a home?

Chem guy
Guest
Chem guy

Well I guess this spits in the face of the “not making any more land” scarcity argument made by realturds:

http://www.vancouversun.com/news/Province+conducted+widespread+review+ahead+planned+700m+asset+sale/6675203/story.html

registered
Member
registered

@2 Contrarian Lemming: Unless those parents are selling and downsizing, creating downward pressure on home prices, the only way “that equity is now being used to help the children” is with mortgages and new debt, changing his ‘richness’ calculation. Non-marketers generally see the difference in financial health between a population with implied paid off homes and a city of 55-74 year old new mortgage holders.
Does ‘civic saboteurs’ work for the Rennie-types?

southseacompany
Member
southseacompany

Burnaby Now publishes Gord Goble article:

‘House of cards’ will implode, By Gord Goble, Burnaby Now”

http://www.burnabynow.com/business/House+cards+will+implode/6677183/story.html#ixzz1vtRpcVSe

De La Riva guard
Guest
De La Riva guard

@george:

Nice find George.

Heads of state and central bankers would do well to take a load off for a day and take to heart Pete Seeger’s lyrical rendering of Ecclesiastes 3:

To everything – turn, turn, turn
There is a season – turn, turn, turn
And a time for every purpose under heaven
A time to build up, a time to break down
A time to dance, a time to mourn
A time to cast away stones
A time to gather stones together
To everything – turn, turn, turn
And a time for every purpose under heaven

– The Byrds, “Turn Turn Turn”

Have a great weekend everyone!

Absinthe
Member
Absinthe

@Contrarian Lemming: Affordable, Bob Rennie? I do not think it means what you think it means.

Re-diculous
Member
Re-diculous

@southseacompany

Wow…..that has to be the most refreshing and truthful article I have ever read on Vancouver Real Estate in the local media. Thanks for posting.

vangrl
Member
vangrl
2 apartments for sale in my building, one has been listed for about 4 months, and reduced once, not even a low ball offer has come in. I heard last night that they are probably just going to take it off the market. The other apartment has been listed for about a month, is very sharply priced in comparison to others in the area, and $50,000 less than the other listing in the building (not reno’d like the other one..but still) and not one offer.They are also contemplating just taking it off the market and renting it out, not willing to come down too much more in price. The sharply priced unit is priced at what a few very similar (if not exactly the same) units sold for in 2008-2009 in this building. funny thing is, these owners seem to… Read more »
Makaya
Member
Makaya

@Re-diculous: Gord is awesome!

spareanickledimedollarpenny
Guest
spareanickledimedollarpenny

@southseacompany: Whoa!

You will wonder what could have possessed you to overpay by 50 or 100 per cent for a creaking “old timer” in a lousy neighbourhood or a “new” slapped-up-in-a-month-by handy men townhouse in a future ghetto. Your realtor will not be there to console you, your lender will not hand you free money to extricate yourself.

Gord pulls no punches 😀

Chem guy
Guest
Chem guy

High earning self employed speculator letting it all hang out and being told to sold in financial post:

http://business.financialpost.com/2012/05/25/so-much-money-down-the-drain/

And the two investment properties are rented and covering mortgage…just not taxes, strata etc.

Apocarypse Mao
Guest
Apocarypse Mao

How the heck did Gord’s article slip by the real estate ad dept of the Burnaby Now?

vangrl
Member
vangrl

oh man, how can we get Gord’s article on the front page of the Sun or Globe & Mail?

chills
Guest
chills

@southseacompany:

It’s time a movement was started to overhaul the Income Tax Act to exempt savings income, i.e. many of us renters, from income tax as is home appreciation.

gordholio
Member

Hi guys/gals:

Thanks for the kind words.

There were a few typos (I have no idea, for instance, how “handymen” was edited into “handy men”), and it’s just a wee bit bombastic. But no more bombastic than a 24/7 onslaught of RE industry propoganda.

FYI, I originally submitted to the Coquitlam NOW, where it was enthusiastically received. Other papers in the NOW chain (such as the Burnaby NOW) were also free to pick it up.

Rob
Guest
Rob
Gord’s article is incredible, not for what it says (we already knew the mantras) but for where it was published and where it will go from there. My guess is that Burnaby Now has been feeling a drop in real estate advertising and is focusing on being a regional paper of the people again. This isn’t the first anti RE OP-ED they’ve published but it is the most poignant and accessible to the brainwashed. And it strikes right at the heart of why people will leave Vancouver. I don’t mean just Van but the whole province. When there is no one left to buy and prices come atumbling the empty shell of an industry-free, enterprise-free, real estate dependent economy will show its true nature. No real estate -> no jobs -> contractors leave -> shops suffer -> services close ->… Read more »
market stats
Guest
market stats

@vangrl ‘these peeps are just going to take their places off the mls and wait it out’

As the numbers yesterday showed there were a lot of expirations or cancelled listings. I think there will be a lot of disbelief and the question will be whether the economy, income and interest rates, forces their hands to sell or not. Hard to guess on that point, but I think until some level of panic sets in, prices will not completely crater but volumes should as we are seeing to some extent now.

Makaya
Member
Makaya

Gord, your introduction is epic!

“Is there a housing bubble in the Lower Mainland? Housing zeppelin is more like it. Bubbles, after all, are soft and cute and harmless. Zeppelins, conversely, hurtle into the ground, spewing flaming wreckage in all directions. And that’s precisely what we’re about to witness in the region.”

If this article doesn’t put a little doubt in people’s mind, I really don’t know what will.

an observer
Guest

Does anyone know if and when Gord’s article will appear in print in the Burnaby Now? Great stuff and sure to save at least a few potential first time buyers from financial ruin.

N
Guest
N

@an observer:

I don’t know that, but I can suggest sharing it through Facebook/Twitter. It’s the least we can do to give our friends one last heads up while gentling nudging nature in the direction of her inevitable course.

Madashell
Guest
Madashell

@southseacompany: Hats off to the Now newspaper group for printing the article even through there will be repercussions from the Real estate industries. Perhaps the Now group have seem the slowing in RE advertising the the coming RE pop and decided to come clean NOW.

gordholio
Member

#20, an observer: I’ve been told it will be in the print edition of today’s Coquitlam NOW (the originating paper). I’m expecting it’ll be printed today in Burnaby too, but not sure.

Makaya: Thanks. As “Rob” said a few posts down, the article doesn’t say anything we “realists” don’t already know. But it’s in the MSM and at the very least it’ll make readers think.

BulbsForSale
Guest
BulbsForSale

@N: I see there’s a short link to Gords article on the VCI twitter feed, so if you want to post / share / tweet a link you can use that tiny one:

http://vci.im/KZYS6e

I’m posting the ‘zeppelin’ line on FB, that’s too good.

VMD @work
Guest
VMD @work
Good work Gord! Also just published: [What a Greek euro exit could mean for Canada] “A tumultuous Greek exit from the eurozone would have a harder impact on Canada’s economy than the credit crisis recession of 2008 and 2009, a report from a major Canadian bank (TD) warns.” “A disorderly exit of Greece from the eurozone represents the No. 1 risk to Canada’s economic outlook.” Housing market vulnerable A European financial calamity would be bad news for Canada’s housing market, too, the bank warns. The bank says Canadian real estate is between 10 and 15 per cent overvalued as it is, which makes households much more vulnerable to any nasty economic surprises. “A global financial crisis could be a major catalyst for a sharp housing market correction,” the bank said, and with most levels of government in a deficit position… Read more »
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