Friday Free-for-all!

It’s Friday 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 links to kick off the chat:

Business feels pinched by property tax
Anecdotes from the bubble
Inventory graph update
The contractor for the best price?
Housing bubble in a nutshell
Mayors report on affordable housing
Burnabonian porny construction query
Radical downsizing
After 6 years in US at bottom?

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

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julie
8 years ago

Thanks for keeping it free .
I am really enjoying this for posting my website promotional address “www.thevancouverrealestate.ca/ “

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[…] to Vancouver. But my family will lay on the pressure as prices decrease. Could get dicey.” – Patiently Waiting at VCI 29 Jun 2012 8:32pm Share: This entry was posted in 14. Social Effects of the Boom and tagged Anecdotes, British […]

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[…] “I went for lunch today and I wasn’t scorned by my friends for being a bear. The fun is over. I can’t find anyone to argue with anymore. The harsh reality of a very long move down is sinking in. I am sensing big time panic among a lot of people out there. Truthfully I thought it was going to be fun but I think it is just going to be sad.” – McLovin at VCI 30 Jun 2012 9:46pm […]

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[…] “Not that this has much to do about anything … but I could not help but notice that the new Rush tour is not performing in Vancouver this year. I guess they are too. busy playing in world class cities like Columbus, Buffalo, San Jose and many other important hubs around North America and couldn’t squeeze in a stopover.” – condo paradise at VCI 29 Jun 2012 12:53pm […]

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[…] “The evidence of reduced dicretionary spending is starting to mount; last weekend wife’s running-shoe store had eviction notice; going to island tonight and BC Ferries saying that despite recent trial price cuts traffic still at 21 year lows. So has something changed on the island that people don’t go anymore, was the weather worse than last year? No, they are spending everything on re and food presumably.” – market stats at VCI 29 Jun 2012 8:56am […]

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[…] “Talked to an old friend in Burnaby today. About a year ago someone bought the house next door and spent several months doing a total reno. Then the house went on sale for months with no takers. Then it went off the market. Then it went on sale again. And now they are tearing it down. No attempt to salvage anything. Remember in decades past you could drive around the city and go to the demo sales where they spent a week or two selling off the fixtures and stuff first. This is wholesale destruction of wealth. Question is who took or will take the hit – the previous owner, the builders, or the next owner, or some combination of the above. It’s doesn’t get any crazier than this.” – patriotz at VCI 29 Jun 2012 1:01pm […]

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[…] “Co-worker’s mom bought two units a year ago in a presale that is slated for completion next autumn. She bought 2 two-bedroom 1100 square feet units for around $500k each. One for her and one for her son. At the time they figured they would sell their 20 year old Richmond house for $1 million plus and pay off their brand new “upscale” condos. In the meantime they would rent and move into their new digs when it is completed. So they put their house on the market about six months ago and I was getting updates from my co-worker. In the beginning they were showing the house to three or four interested parties during every open house. After about two months they got a low-ball offer ($150k under asking) but they rejected it. Yesterday, I got another update… Read more »

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[…] “My good friend’s wife is realtor on the North Shore. She was about to close on condo purchase (she’s the buyer’s agent). Two things happened – – amount the buyer will qualify is now lower, so not sure if they can afford same place – and – the buyer said they should really wait as the market will now fall so things will get cheaper. That’s one grass-roots feedback.” – ZRH2YVR at VCI 28 Jun 2012 7:49am […]

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[…] “My good friend’s wife is realtor on the North Shore. She was about to close on condo purchase (she’s the buyer’s agent). Two things happened – – amount the buyer will qualify is now lower, so not sure if they can afford same place – and – the buyer said they should really wait as the market will now fall so things will get cheaper. That’s one grass-roots feedback.” – ZRH2YVR at VCI 28 Jun 2012 7:49am […]

Anonymous
Anonymous
8 years ago

@patriotz: “Certainly not at the BC provincial level, as we can see from the new property purchase credit introduced just months ago.”

That was nothing more than a olive branch given to the real estate developers to help get them onside for the next election. Real estate developers have traditionally been big Liberal supporters but the HST really blind sided them and caused a big riff. Programs like this will have little to no impact on the market. It may cause a few first time buyers to buy a new condo over a used condo but that’s it. I doubt it will draw new people in to the market. It will however help the Liberals with campaign contributions and support from the developers in the coming election.

patriotz
8 years ago

@Anonymous:
“I think the part you guys (or gals) missed is government policy now is to deflate housing not inflate it.”

Certainly not at the BC provincial level, as we can see from the new property purchase credit introduced just months ago.

No surprise, as never before in Canada have we seen a provincial economy and provincial government so beholden to the RE industry.

But this and any other provincial measure will be ineffectual in supporting prices. What matters is availability of credit.

Anonymous
Anonymous
8 years ago

RE: Government Tax breaks for real estate. I think the part you guys (or gals) missed is government policy now is to deflate housing not inflate it. The conservatives used housing to stimulate the economy to get elected. Now they are reversing that stimulus because they know it will blow up if they don’t. There is no better time to do it with a majority and the Liberals and NDP in shambles. It would be pointless to make the changes to amortizations and CMHC and then counter with giving tax breaks. The provinces do not have the funds to make any difference in housing. Also note once housing starts going down there will be nothing that can stop it since rates are already at all time lows and people are already maxed out on debt. We have already seen this… Read more »

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[…] a free RE-promotion document available at corner dispensers throughout the city. [hat-tip RaggedyRenter at VCI 29 Jun 2012 11:32pm. See that VCI thread for discussion.] […]

Ralph Cramdown
Ralph Cramdown
8 years ago

@HAM Solo: “I wouldn’t be surprised if, not this year b/c it’s way too early, but if in 2013 or 2014 quite a lot of momentum builds behind mortgage interest deductability as a political platform.”

Well, here’s a back-of-the-envelope calculation: Statscan says total outstanding residential mortgage balance in 2011 was $1,072,262MM. At 3.5%, that’s $37.5 billion/yr in residential mortgage interest. At a 20% tax rate, that’s $7.5 billion/yr in lost revenue, sure to go up with gains in housing stock values and interest rates, and that’s only federal, assuming no provincial deduction. That’s an amount about comparable to the GST cuts, which tipped the budget into continuing structural deficit. Who’s going to campaign for THAT? The left (benefits go disproportionately to the wealthy)? The right (still have structural deficits from last hare-brained scheme)?

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[…] — Update: In related news, Richmond June sales at an all-time low. This from ‘Inventory’ at VCI 29 Jun 2012 9:46pm: […]

Devore
Devore
8 years ago

@Best place on meth:

Rennie is coming unglued because his cozy relationship with the ultra-corrupt BC Liberals is coming to an end next spring, and with it goes all the perks and preferential treatment he’s enjoyed for the past 10 years.

Bob Rennie? He’s more than cozy, he’s at the trough:

http://blogs.vancouversun.com/2012/04/27/judy-rogers-bob-rennie-appointed-to-bc-housing-board/

patriotz
8 years ago

@Crikey:
“Recently in Ontario, government has been willing to seriously consider an argument from the real estate community that property transfer taxes be abolished outright.”

This is nonsense. There is no way that Ontario can reduce taxes on anything. They have a terrible fiscal problem. Remember this is a government that brought in the HST – including on real estate – and made it stick.

There is no stimulus to the RE market that any provincial government will attempt other than narrowly targeted measures such as BC’s current grant for buyers of new properties. They can’t afford anything else.

Even the province that can afford something else, Alberta, where prices are already down >10%, has done nothing.

Crikey
Crikey
8 years ago

@Guy Smiley:
“what do you suspect they could do at a provincial level to affect the housing market?”
The NDP and Liberals have both proven themselves more than capable of doing stupid things in the past. They are all very creative that way.

Apart from incentives like “BC First-Time New Home Buyers’ Bonus” and such, I cannot tell the future, but I am wary of all politicians hungry for votes.

Recently in Ontario, government has been willing to seriously consider an argument from the real estate community that property transfer taxes be abolished outright. They haven’t acted on this idea, but they are currently listening closely.

For chrissakes, why would Ontario need to make buying easier in a bubble market? And what new source of revenue would replace all the property tax transfer money?

Anonymous
Anonymous
8 years ago

@GVREB:

Looks like we are tracking 2008. Nice.

GVREB
GVREB
8 years ago

Large Selection of Available Properties Fails to Lure Buyers into Slow Vancouver Real Estate Market FOR IMMEDIATE RELEASE ON VCI VANCOUVER, B.C. –July 1, 2012 – Real estate sales activity in Greater Vancouver continues to sit at lows not seen in over a decade. Daily sales volume in June 2012 fell further to 113 units per sales day from 130 in May, a decrease of 13 per cent. Consistent with the seasonal trend, the pace of new listings has decreased but at a lower rate than the decrease in sales. This resulted in the second lowest sale to list ratios for the month of June since 2001 and well below the historical average for the month of June. Sales have been slowing for 12 months and this has resulted in a near-record inventory level for this time of the year.… Read more »

Anonymous
Anonymous
8 years ago

@Patiently Waiting: ….Nearly 11,400 kilograms of non-perishables were delivered this week to the Ellis Street depot, where applications for assistance are up 12 per cent from this time last year.”…

Clearly, what they really need is for someone to truck in some HAM.

Islander
Islander
8 years ago
McLovin
McLovin
8 years ago

Jessie – Fair enough but regardless of their cost base, anything they buy today will be cheaper in 1 yr. ,cheaper in 2 yrs. ,Cheaper in 3 yrs., until it hits bottom.

They are just throwing money down the drain because they don’t want to rent. That makes no sense to me. The top is in and anyone with half a brain knows it.

So I repeat, anyone buying in the next 12 months is an absolute fool!

jesse
8 years ago

@McLovin: “Anyone buying in the next 12 months is an absolute fool.”

Someone who bought at a lower price and is now selling and buying another property isn’t necessarily a fool, they just don’t want to rent. Their choice to leave money on the table but their cost base is way lower; why must they get caught up in insane speculation, either on the bull or bear side?

McLovin
McLovin
8 years ago

Thanks for the graph VMD!

I wonder what kind of howling and gnashing we will hear from the MSM when the SFH price slips below $1 mil by September?

If anyone is debating if its over surely you must realize by now. Anyone buying in the next 12 months is an absolute fool.

Sell now or be priced in for a generation! (I guess its not so catchy)