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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VMD
Member
3 years 10 months ago

Another one shuts its doors in Vancouver, following lay-offs from Nokia (Burnaby), CBC, Sears, Rogers, game development companies, paper mills, banks, teachers, public sector staffs thus far in the first half of 2012.

June 28: B.C.’s Radical Entertainment lays off 89 staff

I feel bad for those who received the pink slips.. but I have a feeling this is just the beginning..
Layoff tracking thread is located at VancouverPeak

Little
Guest
Little
3 years 10 months ago
My favorite suggestion in the vancouver sun article is that renting an apartment from an individual investor is adequate to supply the rental demands. Yes, moving every time someone flips their property is a great long term solution to our housing needs. In addition, the article seems opposed to the idea that the housing existing on leased land continue to exist. I live in the false creek area, in one of the many coops that keep the area vibrant. It is packed full of families living in two and three bedroom units. Moving into stable affordable housing was the best… Read more »
fixie guy
Guest
fixie guy
3 years 10 months ago

@ Little: Scrolling to the end after barely a third into the “Mayors report on affordable housing”, curious which developer authored it, I shouldn’t have been but was still shocked to find an assistant professor from the Sauder School of Business at UBC. It reads like unambiguous industry propagandizing, confirming any lingering question for me about the value of ‘urban economists’ or the Sauder School of, more accurately for, Business. The constant use of ‘we’, implying Vancouver’s remedy is a settled academic question, is laughable.
Contracted astroturfing on consumer product forums is more credible and professional. Prospective students: think twice.

yvr2zrh
Member
3 years 10 months ago
Just about to go the the airport for a well needed break. Did some average price analysis this morning. To get some indication of trends in pricing, I take a 100 sale moving average. i.e., take all sales, sort by sell date, then take the moving 100 unit average sale price. Our 2 favourite areas are interesting, being Van West and Richmond. Richmond has show significant decrease now in the past 60 days being down 15%. Even after trying to average everything out, no matter how you slice it, Richmond is down. HPI for the month has to be down… Read more »
Anonymous
Guest
Anonymous
3 years 10 months ago
market stats
Guest
market stats
3 years 10 months ago

@ZRH2YVR ‘massive mis-allocation of resources’

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.

Bring on the Rain
Guest
Bring on the Rain
3 years 10 months ago

Enjoy your trip Z

Vote Down The Facts
Guest
Vote Down The Facts
3 years 10 months ago
BulbsForSale
Guest
BulbsForSale
3 years 10 months ago

So if we’re like some of the US cities we’ll only have to wait for about 6 years to see prices stop falling. Hope you weren’t planning on buying here soon!

patriotz
Member
3 years 10 months ago
Alan
Guest
Alan
3 years 10 months ago

Wow, if we start losing video game developers like Radical, what decent paying jobs does Vancouver have left?

Firkin
Guest
Firkin
3 years 10 months ago

@Alan: Don’t worry, we’ll always have the grow-op industry.

patriotz
Member
3 years 10 months ago

@BulbsForSale:
“So if we’re like some of the US cities we’ll only have to wait for about 6 years to see prices stop falling.”

I’m looking forward to it, the US RE market just isn’t delivering that schadenfreude any more.

What are the renters missing out on by waiting to buy anyway, apart from a lot of housework?

yvr2zrh
Member
3 years 10 months ago
#8 – – That’s affirmative – – Meeting with new company in 2 weeks. New handle will have to be ZRH2YVR2ZRH. I’ll be back and forth until X-Mas . . . . Somehow it now feels really like the right thing to do. Did anyone see that great graph that was posted a couple of days ago? It shows a plot for many countries of the 2 main ratios in valuation which were price/income and price to rents? Did you see where Switzerland is? It’s extremely in balance. It’s expensive but you make a lot. And rental cap-rates are somewhat… Read more »
Scott
Guest
Scott
3 years 10 months ago

@Vote Down The Facts: “I thought you’d moved back there?”

I know you think you’re clever, but you obviously missed this detail in the comments:

We’ll see how it goes and it will be a summer move

Could it be that this trip is part of that plan?

Housing speculation has already started to chase off people who add real value to the city. Please stop trying to chase off commenters that add real value to this site with your bitchy little snarky comments.

Scott
Guest
Scott
3 years 10 months ago

@ZRH2YVR: Ah! I see my supposition was correct.

I for one am glad that it will be a drawn out process if it means you will continue to post here 🙂

VMD
Member
3 years 10 months ago

@patriotz:
The twist is, the arsonist IS the fire department

fixie guy
Guest
fixie guy
3 years 10 months ago

10 patriotz Says: “The arsonist claims the credit for calling the fire department.”

Worse, he claims credit for being the fire chief.

C.Junta
Guest
C.Junta
3 years 10 months ago

Regarding the loss of “high-paying jobs” cries.

Here is a link to glassdoor’s review of Radical salaries:
http://bit.ly/LVSfU4

The sample is small, but that’s everything we can get.

The salaries don’t look very impressive. Of course, this type of companies usually offer generous bonuses when the game is successsful. But if you add unpaid extra hours, the lack of job security and pension/rrsp plans to the equation, I wouldn’t call it “high-paying”.

gokou3
Guest
gokou3
3 years 10 months ago

@C.Junta: I see an average salary of ~$75k which is about the average HOUSEHOLD income in Vancouver. I wouldn’t say it’s not impressive.

Vote Down The Facts
Guest
Vote Down The Facts
3 years 10 months ago

@Scott: “I know you think you’re clever”

Touchy. In fact, I think ZRH2YVR is one of the most financially literate and courteous people here, and makes valuable contributions that go way beyond the constant nonsensical immigrations debates that define this blog. I understand that “chasing off other posters” is a position that’s already been filled here, anyway.

Anonymous
Guest
Anonymous
3 years 10 months ago

FYI Radical didn’t fully close down. They kept around 20 people.

C.Junta
Guest
C.Junta
3 years 10 months ago

@gokou3:

True.

On average, a registered nurse in GV makes about the same: http://bit.ly/KI9MN2

But they have:
– well-paid extra hours;
– bomber-proof job security;
– retirement-related perks

Time and money spent on education is comparable. So, we should call RN a “a bit more than just a high-paying job”, shouldn’t we?

What I want to say is: there is a myth created in late nineties about IT guys who make a lot of money for clicking their keyboards. Those times are gone.

Dave
Member
3 years 10 months ago

@market stats:

Fewer Americans are going to Victoria with our high dollar and their weak economy. A small cut in ferry prices isn’t going to bring those people back anytime soon.

patriotz
Member
3 years 10 months ago

@C.Junta:
“On average, a registered nurse in GV makes about the same:”

The average RN is also a lot older and has little prospect of salary increases beyond inflation.

I’m sure that the even the senior software engineers at Radical – who make more than the average RN – are a lot younger.

Lord Huggington
Guest
Lord Huggington
3 years 10 months ago
Speaking of high property taxes for businesses in Vancouver, it’s pretty impressive how many shops have shut down just recently downtown. One of the Starbucks on Robson is gone (along with the White Spot next to it) as is the bag shop across the street from them, Payless Shoes on Robson and Bute gone, Odoul’s is gone, after the American Appeal shops combined there’s another space sitting empty, Book Off just closed up down near Dunsmuir, of course the old HMV has been sitting empty for a while now. It certainly feels like business is drying up downtown very quickly… Read more »
taylor192
Member
3 years 10 months ago

C. Junta,

You’re everything that is wrong with the world today. $75K/yr puts you in the top 14% of earners, and $90K puts you in the top 7.5% – yet you don’t consider that a “high salary”. FFS

http://www2.macleans.ca/2011/10/25/rank-your-income-where-do-you-stand-compared-to-the-rest-of-canada/

TNT
Guest
TNT
3 years 10 months ago
Sold for over asking meets sold for under asking. I wonder if we will be seeing this in the cartels RE rags? So sick of the BS buy now its gonna go higher, sell now its gonna go lower, get in before the changes…..hello? They just want you to buy,or sell. Crap, this market has been manipulated by the RE Board and there sources, banks, brokers,government policies,advertising. What do you expect the mainstream papers/radio/internet sources to say when RE pumps so much money their way. Its fixed, another Ponzi scheme another hand in your pocket, hunker down this storm has… Read more »
UnagiDon
Guest
UnagiDon
3 years 10 months ago

@taylor192: That’s a national average. $75K/yr is a great salary if you live in Medicine Hat. But it’s not so easy to survive on that if you live in Vancouver. For many young folk, housing and daycare expense will use up $75k pretty quickly.

C.Junta
Guest
C.Junta
3 years 10 months ago
@patriotz: “average RN is also a lot older” Maybe. But this doesn’t make their jobs less “high-paying”. “little prospect of salary increases beyond inflation” Not all programmers become executives. Most of them write code while their brain allows them to, and then switch to something less lucrative. To put it simple: unless they change their career path dramatically and go to the upper management level, their chances to stay in the industry after 50 are close to zero. That’s exactly what I am talking about: zero job security. Again: I don’t want to start a holy war here. I personally… Read more »
UnagiDon
Guest
UnagiDon
3 years 10 months ago

Are bankrupt seniors harbingers of things to come?
(e.g., a 25k party?)

http://www.cbc.ca/news/canada/story/2012/06/22/f-bankrupt-seniors.html

ScubaSteve
Member
ScubaSteve
3 years 10 months ago
It looks like Richmond and Vancouver West will be competing for the “biggest drop” this year. A race to the bottom! Richmond has the MOI to be a contendor, but Vancouver-West has the ultra high prices. Which one wins? My money is on Richmond. As for Vancouver East, the prices are about to plunge there too as people realize they are paying west side prices for east side units. Cities like Burnaby will be especially hit hard, while condos in suburbs like Coquitlam, Port Coquitlam and Port Moody will be empty. I think detached in Suburbs and condos in Downtown… Read more »
crashcow
Member
3 years 10 months ago

You can now buy RIM for the price of a japadog.

condo paradise
Guest
condo paradise
3 years 10 months ago

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 . Or perhaps we are too world class for this type of entertainment. We should stick to hockey and rioting.

patriotz
Member
3 years 10 months ago
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… Read more »
Anonymous
Guest
Anonymous
3 years 10 months ago

Debt-plagued arsonist commits suicide in courtroom:

“In the year before the fire, his bank account shrank from $900,000 to just $50. He had a monthly mortgage of $17,250 on the mansion with a balloon payment of $2.3million coming due. In addition, Marin paid another $2,500 per month on a more modest home in Gilbert — where Rapp said he actually lived — and had an overdue tax bill of more than $34,000.

“Marin tried to set up a raffle to pay off the loan, but it was deemed illegal by law enforcement and shut down. Then the house burned.”

http://www.azcentral.com/news/articles/2012/06/28/20120628man-found-guilty-arson-collapses-courtroom-brk.html

HAM Solo
Guest
HAM Solo
3 years 10 months ago
Another point or two of data on the impact of the mortgage rule changes. Not that CAAMP is my favorite source, but their fall 2011 study indicated a couple of interesting points. First, 41% of all new mortgages originated in Canada in 2011 were greater than 25 year amortizations. Second, 37% of mortgages taken out in 2011 were variable rate. So, not that many people who read this site would disagree with the idea, but it lays out the case that about 40% of all new mortgagees are pretty stretched. Somewhere, I also remember seeing the stat that indicated 5%… Read more »
Harry Wang
Guest
Harry Wang
3 years 10 months ago

@UnagiDon: “Are bankrupt seniors harbingers of things to come?”

Who’s going to wipe the bankrupt senior’s asses? It isn’t going to be their spoiled, selfish kids, that’s for sure.

Open the immigration flood gates to cheap labor?

granite countertop
Member
granite countertop
3 years 10 months ago
I wanted to see more discussion on the affordability report. Of course it’s a farce. They totally ignore the elephant in the room, the RE bubble. But I’m happy with their medium density housing recommendation. Vancouver RE is built as an investment, not as shelter. Medium density is at least a step in the right direction. If a SFH has a basement suite it’s by definition not a SFH anymore, and everyone would be better off living in buildings designed for multiple occupancy, like townhomes. OTOH, any kind of housing can be built Vancouver style (shoddy workmanship but granite countertops… Read more »
Anonymous
Guest
Anonymous
3 years 10 months ago

@HAM Solo: Correct me if I’m wrong (Jesse???), but also compounding the $1M+ is the lack of bulk insurance available to the banks from CMHC. Wasn’t this insurance used for mortgages with over 20% down payment or on higher end properties? If I am correct, this would be a double whammy for that market.

ArthurFonzarelli
Guest
ArthurFonzarelli
3 years 10 months ago

Absolutely HUGE immigration changes announced this month, formalized yesterday… Citizenship and Immigration Canada has COMPLETELY SUSPENDED its economic immigration class intake from July 1, 2012 to Jan 1, 2013 – this constitutes approximately 80,000 of our roughly 260,000 immigrants per year – almost all of the wealthiest ones, including Investor Immigrants and Federal Skilled Workers. They begin intake on January 1st again – no applications in the queue are being considered – they all need to re-apply. It takes almost a year to process new applications. This will be HUGE. http://www.calgaryherald.com/news/Ottawa+puts+freeze+immigration+programs+skilled+foreign+workers/6859278/story.html

space889
Member
space889
3 years 10 months ago

@market stats: Or too busy waiting at the border to fill up on US gas and groceries??

C.Junta
Guest
C.Junta
3 years 10 months ago
@ArthurFonzarelli: Thanks Arthur. “In spite of the fact that we have labour shortages, we have immigrants who are not working, even in Alberta,” Yeah, surprise. After all those years observing pizza delivery guys with university degrees, they have realized something is not working. As for the investor immigration program – its value for local communities and the country as a whole was always questionable. Together with the (big) changes to the family reunification program (http://bit.ly/LWeqcK), this is going to change the face of canadian immigration. I bet they will keep running the skilled labor program in some form though. After… Read more »
space889
Member
space889
3 years 10 months ago

@Dave: uhm…those people uses the WA state ferry that lands right at Inner Harbour, not BC Ferry. That’s a straw man argument….geez!

VMD
Member
3 years 10 months ago

@ArthurFonzarelli:

Re: Immigrant investor program, Kenney is shutting off new intakes this year, however, 4500 cases from existing inventory will still be approved(according to SingTao Chinese newspaper report).

in 2011 , there were 10586 investor-class landings in Canada.
Assuming each case comprise of 2.5 individuals, there will still be ~11000 investor-class landings this year.

I think most of the impact This year will be investor psychology. The flippers may start to get worried that in the coming years, there won’t be enough “HAM” to pass the baton to..

HAM Solo
Guest
HAM Solo
3 years 10 months ago
Here’s a question for folks in the banking business. File this one under “where are the losses?” This is what I know: – fairly big parts of the province have been in a housing downturn for over 1 year with damage to date of 10-15% on price. These include the Okanagan, Whistler/Squamish, anywhere North of Victoria on Vancouver island (particularly if retirement oriented), Kootenays. -more recently downturn started hitting locally (Richmond, West Side, parts of fraser valley and various suburbs like Coquitlam,etc). Prices may be down 5-10% from peak, but they are quite recent. -also, I note that the BC… Read more »
patriotz
Member
3 years 10 months ago
@ArthurFonzarelli: I think you’re misreading the article. Skilled workers will keep coming to Canada. What’s being cut off is the applications: Speaking to reporters after his speech, Kenney said the moratorium will not result in fewer skilled immigrants coming to Canada. “We’re not reducing the number of people we bring in – we’re just putting a freeze on the number of new applications that we put in the backlog,” he (Kenny) said. Nor will the number of people coming under family class be reduced in the short run, although it appears they will try to reduce the number of parents… Read more »
van_coffee
Guest
van_coffee
3 years 10 months ago

Fonzarelli –
I think you are reading a bit too much into that article.

With respect to the Investor Immigrant Program, that article said that they were not adding to the existing backlog of applications – it didn’t say that they were not going to process the existnig backlog.

In any event, I like the sounds of this.

We are allowing in the wrong type of immigrants into Canada. I am totally pro immigration and I don’t care if they are white, chinese, black, whatever….my only criteria is that you come here and work your ass off and pay taxes here…

pennysaver
Guest
pennysaver
3 years 10 months ago

interesting article – http://www.montrealgazette.com/business/Forecasters+home+prices+fall/6851705/story.html

Especially like this quote from the TD’s Craig Alexander, chief economist – “Vancouver prices just seem insane.”

ArthurFonzarelli
Guest
ArthurFonzarelli
3 years 10 months ago
@Patriotz The article’s not entirely clear in terms of what’s actually happening… CIC has already eliminated almost all the backlog, and refunded application fees. There are some applications in the queue that are still being processed, and they have worked with some PNP offices to help “mine” the backlog for good candidates to bring forward. But they still cut off 280,000 applicants in the system, and are not taking in any new applications for six more months. Processing of the few stragglers in the backlog that didn’t get refunded will continue to trickle through, but CIC is seriously cutting review… Read more »
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