We want a nice housing bubble
I’m so sick of hearing realtors and mortgage brokers complain about the new CMHC rules.
The government isn’t really bringing in some tough new restrictions, they’re simply rolling back some of their bubble incentives.
The Feds clearly wanted to juice housing and that’s what they got.
Bank of Canada governor Mark Carney says the No. 1 risk to the Canadian economy is a housing bubble. Good grief! How on earth did rock-stable, good-banking, solid-regulating Canada end up on the edge of a possible real estate crisis? Simple. In Canada as elsewhere, housing is a political business policymakers find irresistible. There’s always some government policy — low interest rates, first-time home-buyer incentives, high-ratio mortgages, mortgage insurance, capital gains exemptions, interest deductibility — available to government agencies to bolster the feel-good business of home ownership.
It’s a global phenomenon, from Ireland to Spain, from Britain to the United States. Housing bubbles — rocketing prices following by plummeting prices — are not new to the world economy. The last decade, however, has left an unprecedented trail of housing price chaos and disaster. The similarities from one country to another are unmistakable.
We saw what was happening in the states, and still the government moved amorts from 30 to 40 years and flooded the housing market with money. Where did they expect this to lead?
June 27th, 2012 at 1:02 am 1
A majority government, and they got it.
The marks have served their purpose so now it’s time for the government to pretend that it’s preventing a bubble rather than letting the bubble that they created collapse.
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June 27th, 2012 at 2:27 am 2
Government wants more money just like you and me.
Housing bubble is just a normal part of a cycle.
A bust completes a boom, and creates opportunities for another boom.
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June 27th, 2012 at 5:48 am 3
Ultimately, the conservatives will get blamed for popping the housing bubble. The scened is now set for a complete doomsday scenario for Canada: federal NDP leading in the polls, separatist PQ coming back to Quebec, global economic turmoil.
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June 27th, 2012 at 6:09 am 4
CMHC’s annual report says it all.
Assets + Insurance-in-force + Securitization Guarantees-in-force:
2007: $148 + $345 + $165 = $658B
2008: $203 + $408 + $234 = $845B
2009: $272 + $473 + $300 = $1,045B
2010: $288 + $514 + $326 = $1,128B
2011: $292 + $567 + $362 = $1,221B
No one can deny Ottawa used CMHC to prevent the 2008 correction, and deliberately re-inflated the bubble.
Page 92:
http://www.cmhc-schl.gc.ca/en/corp/about/anrecopl/anre/upload/2011-CMHC-Annual-Report.pdf
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June 27th, 2012 at 6:15 am 5
>>>>>>>>>>>>>>>>>>>>>>>>>>>>PUBLIC NOTICE<<<<<<<<<<<<<<<<<<<<<<<<<<<<<
Crimes against the economy should be laid in an International Tribunal.
Main Defendant: Greenspan
Co-Defendants: Central bankers, and Re Pimps for accessory after the fact.
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June 27th, 2012 at 7:18 am 6
The government sponsored housing bubble produced by CMHC gave Canada concrete shell towers with falling glass and cheaply built cardboard houses held together by glue and 2×4′s, finished with your favorite big box store fake brass finishings and photocopy floors. Way to go bureaucrats! Just as effective as the Soviets diverting water to the Aral Sea.
CMHC should have been replaced by vendor take back mortgages – let the free market take the risk. The whole concept of CMHC was a fraud from day one. The result would have been a significantly lower house price level, an efficient allocation of resources into the real economy, a higher standard of living – less stressed out households and most important, superbly built houses with real hardwood floors just like the original built Shaughnessy houses.
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June 27th, 2012 at 7:35 am 7
@crabman:
The irony is we have Carney, Flaherty and Harper prancing around the world lapping up the adulation of the ‘Canadian miracle.’
All the Canadian miracle boils down to is blowing up RE so that we can delay and magnify our crisis.
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June 27th, 2012 at 7:37 am 8
Well, on the upside, if this monster finally collapses under its own weight maybe at least our (grand)children stand a chance of living a decent lifestyle one day. After it all restarts from scratch and the smart ones finally take over from the greedy.
I would doubt that we ever see real hardwood floors ever again though…
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June 27th, 2012 at 7:43 am 9
The Teranet numbers are out for the month of May. Interestingly, Vancouver is still up 4.4% year-over-year; however, this is down a little from last month’s 4.9% year-over-year increase, and is below the 11-city composite’s 5.8% year-over-year increase.
I’m surprised by this – considering anecdotal evidence of prices falling in Vancouver and listings in certain neighbourhoods skyrocketing, I would have thought the year-over-year increase in Vancouver would have been much lower…
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June 27th, 2012 at 7:49 am 10
@frank:
And sky high commodity prices. Nobody talks about the Saudi miracle, but they are doing just fine for the same reasons as Canada.
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June 27th, 2012 at 7:51 am 11
@7 frank: “The irony…”
…is we replicated the catastrophic errors of other nations long after the negative consequences were unambiguously clear, and flaunted delusions of superiority in their face while doing so. Harper did damage to our global image that will last a generation, morphing a solid, self-effacing competence into laughable buffoonery.
Granted, he will leave a legacy of performing (temporary) miracles for bank profits.
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June 27th, 2012 at 8:02 am 12
The post about Google Trends leading cities searching the term ‘housing bubble’.
Look at the google trend graph for the search term ‘housing bubble’ in Canada only:
http://www.google.com/trends/?q=housing+bubble&ctab=0&geo=ca&geor=all&date=all&sort=0
2012 is the only time on record in Canada where there has been a sustained search volume over a period of months. It’s just one more indicator that the notion of a housing bubble seems to have entered the public psyche.
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June 27th, 2012 at 8:05 am 13
@Just Looking…: Meant to say in my first sentence that the post led me to look at google trends for some data…sorry for the poor proofreading.
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June 27th, 2012 at 8:07 am 14
Yeah the Teranet data is odd.
This is a new high in Vancouver Home Price Index – and volume sales pairs are up 161.954% MoM, while volume over the 12 month volume moving average is up 108.79%.
This is really fishy, very very fishy. I don’t dismiss the findings out of spite but very contrary to the data we have been seeing.
Victoria which is supposed to be very slow has a no change in volume YoY. Off 5% from the highs on price.
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June 27th, 2012 at 8:15 am 15
Teranet Index Change from highs
Composite 6 – new high
Composite 11 – new high
Victoria – down 5% ******
Vancouver – new high **********
Calgary – down 9.4%
Edmonton – down 12.3%
Winnipeg – new high
Hamilton – new high
Toronto – new high
Ottawa – new high
Montreal – new high
Quebec – down 0.5%
Halifax – new high
Teranet Volume change from last May 2011
Composite 6 – up 15.94%
Composite 11 – up 16.65%
Victoria – down 0.87% ******
Vancouver – down 23.86% **********
Calgary – up 16.47%
Edmonton – up 36.1%
Winnipeg – up 6.9%
Hamilton – up 20.27%
Toronto – up 50.90%
Ottawa – up 20.18%
Montreal – up 21.55%
Quebec – up 23.75%
Halifax – up 49.74%
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June 27th, 2012 at 8:28 am 16
@trash crash alert:
“The whole concept of CMHC was a fraud from day one.”
Not day one. CMHC was created to address the dire housing shortage for returning WWII veterans. The free market – such as it was just a year after 1945 with the economy still on a war footing – would have taken over a decade to fix the problem.
CMHC’s mortgage insurance should have been done away with when the baby boom ended around 1965 and actual demand for shelter tapered off.
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June 27th, 2012 at 8:39 am 17
@real_professional: If I recall, they recently decreased the time delay in announcing their data (so now it is for the previous month). I don’t know if they had to change their methodology in order to do this.
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June 27th, 2012 at 9:01 am 18
14 real_professional Says: “Yeah the Teranet data is odd.”
The Vancouver numbers significantly lag national performance and are further still behind the Composite 6. That’s a big change from the glory days.
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June 27th, 2012 at 9:49 am 19
What’s beautiful fellow “bears” is when we see the numbers, especially the increased volume of listings, we’re just valitading to ourselves that this beast is cooked. Remember a couple years ago after the 2008 drop in prices and then the 2009 rise again? Some of us actually questioned our initial instincts and there was some doubt. Not anymore.
The bigger issue now is the overall shaky economy. I personally think we have yet to see real “bad times.” A collapse in housing prices and the construction industry in general will exacerbate the economic meltdown. I believe that I may have completely missed the boat on ever owning and I’m completely alright with that. I fear more for my children’s future…
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June 27th, 2012 at 9:51 am 20
@real_professional: So the most trusted bear index, Teranet, is showing the largest YOY price increases. That’s gotta hurt.
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June 27th, 2012 at 10:33 am 21
@frank:
There’s a great article in the NY Times today about Spain’s real estate bubble… Same BS in 2006 there as here now…
http://www.nytimes.com/2012/06/27/business/global/spanish-officials-hailed-banks-as-the-crisis-built.html?pagewanted=3&_r=1&hp
“There was a sense that Europe was different.”
Spanish Banks “fundamentally sound”
“a new era in economic policy”
“For a time, Spanish financial institutions were hailed as paragons of responsible banking”
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June 27th, 2012 at 10:36 am 22
@real_professional: I wouldn’t say it’s that odd. In several places around BC there’s been some real “hang time” in between 7 MOI and price decreases. Vancouver’s just changing now.
Changes in average and median prices show what’s being sold, not what a particular house is selling for. In my neighbourhood it looks like comps are about the same as last year – ie: no gain, but no loss, either.
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June 27th, 2012 at 10:58 am 23
@Troll:
If the data doesn’t reflect my opinion then it’s the data that’s wrong.
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June 27th, 2012 at 11:09 am 24
@Troll:
I’m kind of relieved that Teranet more or less corroborates the REBGV benchmark.
If they’re on the same page then at least we know where we stand and no longer have to be suspicious of the boards new and improved recalculated HPI.
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June 27th, 2012 at 11:22 am 25
@Best place on meth: so it looks like there are a lot less houses trading hands, but those that are selling are not going for a reduced price.
Theoretically if sales stay low it will drive prices down, If sales rise prices will stay flat or rise.
Will be interesting to see how the July 9 rules affect this market.
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June 27th, 2012 at 11:22 am 26
@trash crash alert:
“The whole concept of CMHC was a fraud from day one.”
I agree with patrioz on this, i.e., “not from day one”.
My dad was a WWII vet. We lived in a 640-square-foot no-basement rental house built by CMHC, in a CHMC-built rentals-for-vets suburb … for about 10 years. For us “central heating” meant the small coal stove (for heating, not cooking) was located in the center of the house with all bedroom doors facing the stove, lol. In the early 1960s, CMHC encouraged tenants such as ourselves to buy the houses … they offered a 25-year mortgage with (low) rate fixed for 25 years!! Short of that, I doubt my parents could have bought a house.
The scenario then was that CMHC filled a critical social need.
This is no longer the case. Indeed, imho, CMHC seems now to function as a government-sponsored shill for the RE industry. They need to go.
With reference to crabman‘s insightful post on the CMHC 2011 Annual Report …
[sarcasm] But hey, did you see the pictures of really friendly-looking economist/government guys and needy-looking beneficiaries of CMHC programs. The guys in suits really have this you-can-trust-me-I’m-so-wise look about them. What about the really advanced technical jargon, columns and tables full of numbers! And the charts go up and down with different colours meaning different things. Wow! Who would diss CMHC after seeing that material? [/sarcasm]
CMHC clearly know what they’re doing!
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June 27th, 2012 at 11:37 am 27
@patriotz: “CMHC’s mortgage insurance should have been done away with when the baby boom ended around 1965 and actual demand for shelter tapered off”
Reading through CMHC’s history it has been monotonically and gradually increasing its influence in the Canadian housing market for the past 55 years. CMHC’s pinnacle of influence was reached in 2008. Since then it has been scaled back a tad, but ultimately, compared to where Canada was when CMHC embarked on mortgage underwriting, it’s a completely different ball game. Also note CMHC was set up because policymakers at the time were still singed with the experiences of the US mortgage market collapse in the 1930s and wanted to ensure any market-based system was tightly controlled to avoid a similar fate in Canada.
The most recent ire at CMHC should take its historical role in Canadian housing into account — the government has had its hands in mortgage financing since WW2 in a big way, and I don’t think it’s going to change quickly.
But in short the argument for government involvement in housing finance is that it provides a net benefit above what a free market system could provide. Canadians should understand that this isn’t necessarily for free, that the business risks associated with housing cannot be eliminated, rather they can only be shared.
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June 27th, 2012 at 11:42 am 28
A little perspective on the “surprising” Teranet stats. We really shouldn’t be surprised at all, given the MOI over the spring:
Feb: 5.7
Mar: 5.6
Apr: 6.2
May: 6.5
Recall that a “balanced” market is roughly around 7 MOI, so this year’s slight price increases are generally what one would expect given that MOI has been somewhat below that. Plus, a lot of us have been fixated on the 10% drop in average prices, but these are for detached properties only, and the average is not a particularly meaningful measurement statistic to start with.
Much more significant is the fact that MOI so far this year has been a lot higher than normal, and it’s clearly going higher still over the next 6 months. In addition, keep in mind that 2008 also saw price increases in the first half of the year, only to be followed by a 15% drop over the following 8 months. So far 2012 is looking even more bearish than 2008, for a number of reasons… give it time.
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June 27th, 2012 at 11:55 am 29
@Dan in Calgary: “This is no longer the case. Indeed, imho, CMHC seems now to function as a government-sponsored shill for the RE industry.”
One way I’ve looked at CMHC is its mandate, as worded, is in danger of being flipped from “good” to “evil” and back again depending upon speculative conditions. In times where houses are cheap, building is stagnant, the workforce needs to be mobile, and CMHC has provided loans in areas where providing adequate housing is not economically viable.
When speculation is high, OTOH, CMHC’s mandate is perverse because it inherently supports it increasing its influence to attempt to make unaffordable homes affordable through preferential financing. That feeds on itself as we’ve seen recently.
That in effect invalidates CMHC’s mandate as worded; at the very least it should have its mandate reworded to take into account when its switch is turned to the “evil” setting. If the inconceivable happens and housing hits a prolonged rough patch I see that there will be a role for CMHC again, as crazy as that sounds, though hopefully restructured to limit its influence when speculation occurs.
My 2 cents.
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June 27th, 2012 at 11:56 am 30
A balanced market may be around 7 months of inventory only if prices are stable. You could have 7 months of inventory and falling prices too. And that would not be a balanced market by any stretch of the imagination. Or in the case of new condominiums, 7 months of inventory could have rising prices and that would not be a balanced market either. I’m mentioning this because I am noticing that the phrase “balanced market” is popping up everywhere. I especially like it when I hear that the market is now “more balanced” than it was before. WTF
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June 27th, 2012 at 11:57 am 31
@Troll: That’s good, it means I have a fighting chance of winning VMD’s price prediction competition!
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June 27th, 2012 at 12:00 pm 32
I don’t believe CMHC has a mandate. But if there is one, I would like to hear what it is?
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June 27th, 2012 at 12:06 pm 33
New Listings 113
Back On Market Listings 6
Price Changes 97
Sold Listings 67
AS OF 12:10 PM
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June 27th, 2012 at 12:08 pm 34
June is almost over, and still no crash. Prices are up. Looks like another profitable year in the Vancouver real estate market.
Amateur economists on this site continue to be wrong.
vancouvercondo.info wrong for 6 years and counting.
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June 27th, 2012 at 12:08 pm 35
Just wanted to point out that Terence Corcoran is a major crank journalist and climate-change denier on par with the US Republican right wing.
Hmmmmm…..So now he’s decided there not only is a Canadian housing bubble but – of course – it’s all the Government’s fault. Probably the fault of all those lefties…
Maybe he’ll write another article blaming it on P.E. Trudeau, yeah that’s probably it!
A few years ago he also wrote an unintentionally hilarious article denying there was a US housing bubble and a looming credit crisis down South. He blamed all the bubble talk on – what else – left-wing loonies and pinkos who just couldn’t comprehend the miraculous workings of the US free market in action.
Oops.
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June 27th, 2012 at 12:11 pm 36
Vancouver real estate will go up forever. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will. No it wont. Yes it will.
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June 27th, 2012 at 12:19 pm 37
The Teranet data tracks changes in the price of what IS selling, not changes in price of what is NOT selling. The latter is the real story of this market.
I suspect that with lower sales pair volume, all we are seeing is increased noise in the data.
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June 27th, 2012 at 12:35 pm 38
36 Summary Says: “Vancouver real estate will go up forever. No it wont. Yes it will….”
This will jog you out of spin: it’s mathematically impossible for an asset price to go up forever in any valid sense
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June 27th, 2012 at 12:48 pm 39
@boogeybear:
“I don’t believe CMHC has a mandate. But if there is one, I would like to hear what it is?”
CMHC works to enhance Canada’s housing
finance options, assist Canadians who cannot afford housing in the private market, improve building standards and housing construction, and provide policymakers with the information and analysis they need to sustain a vibrant housing market in Canada.
Fail on most counts.
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June 27th, 2012 at 12:49 pm 40
@boogeybear: https://www.cmhc-schl.gc.ca/en/corp/ca/ca_012.cfm
I like the “on their own” part. So contradictory to its core it blows the mind of even a simpleton like myself.
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June 27th, 2012 at 1:28 pm 41
Maybe, CMHC has to be brought back to a more simpler mandate like helping Canadians to purchase their first home.
Not bank rolling offshore purchasers, financing rental investment properties, home equity lines of credit, etc.
I don’t think it was ever envisioned that CMHC would one day insure more debt than all of the Canadian national debt.
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June 27th, 2012 at 1:32 pm 42
@Simple:
“The Teranet data tracks changes in the price of what IS selling, not changes in price of what is NOT selling. ”
A property that is not selling does not have a price. Only a property that sells has a price.
Further to Teranet, remember they get their data from land titles, so they log a given sale only when the title actually changes hands. REBGV on the other hand logs a sale when conditions are removed. There can be a fair sized lag between the two.
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June 27th, 2012 at 1:41 pm 43
The best way to ensure that the housing market runs efficiently is not to have government intervention. So, CMHC has made it possible for most Canadians to get access to pay a monthly mortgage. CMHC has made it possible for all of us to buy a home – not own a home – that won’t be happening for another 30 years – maybe?
It’s ironic, that this seemingly altruistic mandate has been warped into the greatest wealth trap for Canadians. How a federal government could figure out a way to reach into the back pocket of hard working Canadian and then when CMHC fails have all Canadians pay higher taxes to bail out the banks.
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June 27th, 2012 at 1:45 pm 44
http://www.vancouversun.com/business/Metro+Vancouver+multi+family+developments+defy+bubble+trouble+sales+stay/6849120/story.html
Metro Vancouver multi-family developments defy ‘bubble trouble’ as sales stay strong. Sales up 79 percent from the Fourth Quarter of 2011
More bubble talk leading the sheeps to the slaughter house, VCI members dispute these claims
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June 27th, 2012 at 1:55 pm 45
@patriotz: “There can be a fair sized lag between the two”
Yes, in the case of some recent sales, the closing dates can be months where before, in an “seller’s market”, they would be weeks.
Teranet is a lagging indicator, the benchmark is definitely more timely, but the best leading indicator we have is sales and inventory levels.
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June 27th, 2012 at 2:18 pm 46
@Bull! Bull! Bull!:
I voted you down.
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June 27th, 2012 at 2:27 pm 47
43 boogeybear Says: “It’s ironic, that this seemingly altruistic mandate has been warped into the greatest wealth trap for Canadians.”
Canadians became acceptable collateral damage for the new mandate of economic stimulus, which is no less ironic.
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June 27th, 2012 at 2:35 pm 48
@jesse:
Jesse don’t be so sure about that yet! We’ll find out in a week!
http://s13.postimage.org/ojfx3uzhj/VCI_new.jpg
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June 27th, 2012 at 2:53 pm 49
@ Patriotz
I agree, over-priced homes that are not selling would shift the index lower and could result in a pretty sharp decline in the index given their methodology.
Still a bit of a surprise though – new highs on increased volume? come on, that is ridiculous. I don’t know what is causing it but I wouldn’t rule out a methodology change at Teranet National Bank.
It is still the best index in Canada.
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June 27th, 2012 at 3:08 pm 50
We went to look at a townhouse to rent in East Van. The woman told us the address, we googled it and found out it’s on MLS listed for sale. I hate living in places like that, you’re always wondering if you’ll be out the next month. Anyway, I went to check it out anyway (with no intention of really renting it), and asked her if she planned on selling. She eagerly asked “Why, do you want to buy it?” I guess it’s been for sale for awhile. I think this woman has multiple properties (somewhat recent immigrant, maybe within 10 years), I googled her number and came up with many different properties for rent. At the end of the meeting, I wished her good luck, she told me to call her if I changed my mind about buying the unit. :s I could smell her desperation.
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June 27th, 2012 at 4:15 pm 51
#32 @boogeybear: “I don’t believe CMHC has a mandate. But if there is one, I would like to hear what it is?”
With apologies to AMD: http://i.imgur.com/MrELU.png
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June 27th, 2012 at 4:52 pm 52
On a business trip with a colleague from Victoria, who I knew just purchased last year at the peak of the market. I mentioned how Vancouver prices were coming down, and that the Victoria market had already dropped. He agreed, and half heatedly lamented that he had bought at the peak. But in the next breath, he said its all relative, because if his house goes down so do all the others, so it makes no difference if prices go down.
Amazing – so highly educated but failed to realize that with his 10% down, he would be underwater if he went to move or buy up.
This “its all relative” mantra is really prevalent, even my own father believes this.
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June 27th, 2012 at 5:08 pm 53
@Yalie:
I don’t think it has anything to do with MOI. It just confirms what we’ve seen here the last year. Last year’s (and early this year) spike in average due to higher volume in the high end, and this year’s drop off in average due to a dead high end market. By all accounts the “affordable” segment, $600-800k, which seems most households purchasing in the last 2 years fall into (also see Toronto and Victoria for similar patterns), is rather steady, and has now moved out of Richmond and Van west into Van east. The benchmark, which should track sale-pairs given enough data, just tells us what we already knew; stagnant condo prices, creeping SFH due to comps and supply.
In general, it seems most “bulls” and “bears” are expecting far too much movement in far too short a timeframe.
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June 27th, 2012 at 5:27 pm 54
@Devore:
I agree with this statement… but I still don’t see how you can say MOI is no longer relevant. MOI has always correlated with price movements. Have a look at Jesse’s MOI/price change chart one more time:
https://docs.google.com/spreadsheet/oimg?key=0Aku6wWaKdvsQdGFxWmRncEVxeEcxMU14Q2xnam1pRWc&oid=11&zx=sm9ndes2a5zr
That’s as close to a perfect correlation as you’ll ever see with real world data. What makes you think the relationship no longer holds all of a sudden?
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June 27th, 2012 at 5:29 pm 55
@Devore:
“it seems most “bulls” and “bears” are expecting far too much movement in far too short a timeframe”
You wouldn’t believe how fast prices are dropping!
http://www.realtor.ca/propertyDetails.aspx?propertyId=12087121&PidKey=278499721
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June 27th, 2012 at 5:32 pm 56
Public policy that encourages developers to build rentals on leased land would amount to subsidizing rent for a limited number of tenants at great cost to other taxpayers, said Prof. Thomas Davidoff of UBC’s Sauder School of Business. “To use money in that kind of way is almost criminal. It’s like holding a lottery for a few lucky households.”
Prof raps city’s housing scheme
Here we go again. More government meddling in the housing market. Yet another politician who thinks he’s smarter than Econ 101. Supply and demand. Government at all levels need to make it easier for builders to build (supply) and return access and the cost of credit back to market levels (demand) and the problem will take care of itself.
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June 27th, 2012 at 5:34 pm 57
@Told Yous:
No doubt the same guy carefully reads all the flyers he gets to make sure he doesn’t buy something before it goes on sale. Because of course, that would be losing money.
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June 27th, 2012 at 5:50 pm 58
as a trader, it’s always fun watching the change in market trend. First, weak longs get heavily pressured to sell. They form the initial leg down. Once momentum picks up, even strong longs begin doubting themselves. The bottom ain’t reached until the majority of the strongs thrown in the towel.
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June 27th, 2012 at 6:30 pm 59
@Best place on meth
ALthough I expect prices to come down, can that be a mistake? those places go for over a million
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June 27th, 2012 at 6:37 pm 60
Recap of tonights Global real estate piece:
-Interview with the usual Sauder mouthpiece.
-Sewer explains that incomes don’t really apply to Vancouver because of rich immigrants, riches passed down to kids, yadda yadda yadda….
-then on to the balanced part of the segment where they show west side houses NOT in bidding wars like last year and sellers lowering their asking prices but prices not really dropping much.
-conclusion, prices unlikely to fall.
Case closed, now on to sports.
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June 27th, 2012 at 6:39 pm 61
@s:
Yes, it’s a mistake – there’s a digit missing, likely a zero at the end.
The realtor got confused while figuring out where to place the 8.
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June 27th, 2012 at 6:39 pm 62
“999 Index” Update
Homes priced between $999,999 and $999,000
June 26:101
June 27:105
http://www.ecorealtyinc.ca/search?q=under+999999
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June 27th, 2012 at 6:45 pm 63
@Best place on meth:
“You wouldn’t believe how fast prices are dropping!”
http://www.realtor.ca/propertyDetails.aspx?propertyId=12087121&PidKey=278499721
The Realturds® errors and omissions insurance will cover this faux pas, won’t it?
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June 27th, 2012 at 6:52 pm 64
@chilled: Maintenance Fees : $1,245.85 Monthly
WOW… thats almost as much as I pay for rent for mainfloor 3 Bedroom house rental :O
Stupid
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June 27th, 2012 at 6:56 pm 65
@pricedoutfornow:
Actually, now that I think of it, I think she might be the “I buy three, my husband buy three” woman :s
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June 27th, 2012 at 6:58 pm 66
It says monthly maintenance is $1,245.85, is that part of the strata?
Sorry I’m not attuned to reading mls listings
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June 27th, 2012 at 7:11 pm 67
@SomethingSimple: Yup.
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June 27th, 2012 at 7:11 pm 68
@Best place on meth:
“-Sewer explains that incomes don’t really apply to Vancouver because of rich immigrants, riches passed down to kids, yadda yadda yadda….”
Well how about rents then? Has he so much as touched on price versus rent, aka price versus earnings? Or does he just assume that rising prices will make up for the deficiency in rental yield? What word do we use for that?
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June 27th, 2012 at 7:35 pm 69
@pricedoutfornow:
“I think this woman has multiple properties (somewhat recent immigrant, maybe within 10 years):
Oh-oh! A faux pas! Apparently if you mention certain realities about recent immigrants-come”locals” money in Vancouver, and how many immigrants buy/hold multiple properties… you will only get accusations of racism!
Pish-posh! Immigrants with money, what immigrants with money? They don’t exist, except the ones that do, but they and their multiple property holdings, each, have *no* effect on anything. Move along, nothing to see here…
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June 27th, 2012 at 7:51 pm 70
A month old but hilarious especially the last paragraph.
More than half of B.C. homeowners have refinanced their home or property, a new survey by Mustel Group for the Society of Notaries Public found.
Of those who have refinanced, 49 per cent used the money for renovations; 23 per cent to buy other real estate; 23 per cent for other investments; 10 per cent to purchase a new car; and 8 per cent to consolidate or pay off other debts.
“B.C.’s homeowners have enjoyed a healthy real estate market in most areas of the province,” said John Eastwood, president of the Society of Notaries Public of B.C. and a South Delta notary. “Many homeowners find themselves in the fortunate position where the current value of the house or property has far surpassed the price they initially paid, meaning a significant amount of their equity is tied up in the home. Mortgage refinancing allows them to access this equity without having to sell or downsize.”
Homeowners were split on whether the value of their homes would go up in 2012, with 44 per cent saying they expect an increase and 52 per cent expecting prices to stay the same.
In Metro Vancouver, 54 per cent said they expect prices to go up, with 34 per cent not expecting increases in the next year.
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June 27th, 2012 at 7:55 pm 71
@Crikey:
It is racist if we just keep saying it is just Chinese buyers. Yes, there are a lot of them, but there are a lot of Russians, White South Africans, US Armagedonnites, Israelis, Germans and other buy-and-leave investors who are not as obvious.
If we admit that the buyers-of-convenience whatever their hue are detrimental to life in this city, then we are stating a fact.
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June 27th, 2012 at 7:56 pm 72
New Listings 251
Price Changes 170
Sold Listings 137
TI:19449
http://www.laurenandpaul.ca
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June 27th, 2012 at 8:07 pm 73
It’s 2008 all over again for these two Sahalee/Nahanee towers I’ve been watching in Port Moody. Except in 2008 there was only one of them
2708 660 NOOTKA Way, 2b/2b 908sqft $375,000 (V959298).
“WOW! Almost $70,000 Below the market Value!!!ALERT Investors, First Time Home Buyers; don’t miss this unique opportunity!! …..Hurry!Snooze you lose!”
The unit is assessed at $397,000.
Comparables in the building (fyi there are over 20 units for sale):
1108 – $415,000
2208 – $438,000
1808 – $449,000
3008 – $458,000
It’ll be interesting to see how quickly this gets snapped up and for how much.
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June 27th, 2012 at 8:15 pm 74
@McLovin: “44 per cent saying they expect an increase and 52 per cent expecting prices to stay the same.”
44+52 is (tap tap tap) 96. The other 4% must have been “Don’t know/unsure”.
I bought some 6 month and 12 month popcorn futures recently. I don’t want to risk them being too expensive when I need a refill.
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June 27th, 2012 at 8:24 pm 75
wake up frank. Look around. The city is over 50% Asian now, when 20 years ago it wasn’t even close. Of course this has had an impact on prices. And don’t play the you just notice other immigrants because they aren’t white, as if there are just as many Russians or south africans but they just blend in and we don’t notice. Let’s just be honest with ourselves and not so scared of telling the truth.
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June 27th, 2012 at 8:27 pm 76
Don’t worry my pets.
Like I said earlier this year – 20% off peak prices by Fall 2012.
Just relax, take a chill pill.
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June 27th, 2012 at 8:37 pm 77
Four weeks ago, the guy next door puts up a sign in from of his SFH: FOR SALE by OWNER.
10 days later, a new sign, with the name of a remote real estate agent
today, a new sign again, with a REMAX agent (Chinese name).
Desperate to sell? No offer?
I have seen several changes of realtor in my hood… after only a few weeks on the market. What are they thinking? That their home will go in one week?
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June 27th, 2012 at 8:39 pm 78
@Phil: “The city is over 50% Asian now, when 20 years ago it wasn’t even close”
So when you say “Asian” do you mean someone who was born in Asia, or someone who looks Asian?
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June 27th, 2012 at 8:44 pm 79
Inventory at a crawl but still moving in the right direction.
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June 27th, 2012 at 8:44 pm 80
To be Chinese or not to be Chinese.
That is the question that has haunted mankind since the dawn of time.
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June 27th, 2012 at 8:46 pm 81
another example:
http://www.realtor.ca/propertyDetails.aspx?propertyId=12132197&PidKey=1039163963
2 months ago: 1.5 million
1 month ago: 1.3 million
off the market
now back on the market, new reator, 1.25 million…
http://www.realtor.ca/propertyDetails.aspx?propertyId=11945488&PidKey=-2068193445
2 month ago: 2.4 million
now: new realtor, 1.99 million.
It is moving so fast I cannot believe it!
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June 27th, 2012 at 8:54 pm 82
Why do u need that clarified? And yes, I understand there are people who are born in Canada of Asian descent.
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June 27th, 2012 at 8:56 pm 83
@jumpin in:
Examples of ridiculous asking prices don’t tell us anything. Only sales data matters.
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June 27th, 2012 at 8:58 pm 84
@Romeo Jordan:
“Just relax, take a chill pill.”
EXCUSE ME!?!?!?!
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June 27th, 2012 at 8:59 pm 85
Chilled:
Your excused.
Four more For Sale signs popped up on my daily drive since the new mtg rules were announced.
Market could go funky quickly.
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June 27th, 2012 at 9:05 pm 86
@Phil: “The city is over 50% Asian now”
False.
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June 27th, 2012 at 9:06 pm 87
@Phil: “Why do u need that clarified?”
I thought it would be obvious.
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June 27th, 2012 at 9:09 pm 88
Agreed, it was pretty obvious where you were going with that leading question.
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June 27th, 2012 at 9:12 pm 89
@Crikey: “Apparently if you mention certain realities about recent immigrants-come”locals” money in Vancouver, and how many immigrants buy/hold multiple properties… you will only get accusations of racism!”
You think one example somehow proves your point? Or contradicts the Landcor data? News flash: there are white Canadians who own multiple properties too.
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June 27th, 2012 at 9:27 pm 90
@vote down the facts, the 2006 census shows 47.1% white and 42.7% Asian. There is a 6% other, which I’m not sure what that includes. Now consider the levels of immigration in the last 6 years and it’s safe to assume the white (the previous largest population) and Asian populations are even. So my point stands. That point being that the Asian population has increased greatly in the last twenty years and has accordingly affected the price of real estate.
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June 27th, 2012 at 9:28 pm 91
Things are getting interesting in Squamish!! You have this listing: V958237 for 575k in the Meighan Creek development that backs onto the golf course that does not exist and for 85k less you can have this unit :V952328. They are exactly the same units, on either side of the same block.
I’ve never been in the units, but there can’t be that much difference. Also, you can buy a house for the same price as either of these units, and actually own land…..
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June 27th, 2012 at 9:35 pm 92
@Phil: “Look around. The city is over 50% Asian now”
So Phil are you trying to say we have a housing bubble because the population is 50% Asian in Vancouver? Would we have avoided a housing bubble If our population was almost all white like Edmonton? Would prices be normal if we had a large Cuban population like Miami? How about a large black population like Washington DC? Would that have prevented the housing bubble? Could an influx of Mexicans like in Arizona stopped this housing bubble from ever happening?
Phil please tell us your theory.
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June 27th, 2012 at 9:39 pm 93
I will tell you that your theory is incorrect. Look at the part of the sentence following the comma that you conveniently left out of your quote and you will have your answer.
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June 27th, 2012 at 9:51 pm 94
Lets Back to RE
A nice reduction:
http://vancouver.en.craigslist.ca/van/reo/3105586224.html
Fancy Court Ordered Sale:
http://vancouver.en.craigslist.ca/van/reb/3104993417.html
$220K under assessment
http://vancouver.en.craigslist.ca/bnc/reb/3073387063.html
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June 27th, 2012 at 9:52 pm 95
Dear blog dogs,
It has come to my attention that the site needs a few new topics of conversation. After years of debate and data point watching (is RE overvalued? is the inventory picture turning? are prices declining?) we have most of those issues pretty much settled. The market has peaked, prices are coming down, and we are all discovering that there are a whole host of factors that will serve to accelerate and or extend the downturn.
We all have the option of going somewhere else, but I kind of like this spot. However, I’m not sure I want to hang around for endless scapegoating (of Asians or Tories or Realtors or In-laws). It would be nice if we had a good discussion of the data and realtime update of the extent of the decline. Independent discussion of the banks’ reactions. Investment opportunities related to the meltdown. And other good stuff…like..well, news you can use. How the downturn is affecting certain aspects of city life, or what our politicos should do about the mess (heaven knows, enough of them get shown info from blogs like these, hello Premier Clark!) Maybe info on foreclosure and bankruptcy tactics.
What say ye?
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June 27th, 2012 at 10:01 pm 96
@Phil: The city is over 50% Asian now, when 20 years ago it wasn’t even close.
Okay so when a population becomes closer to 50% Asian a housing bubble forms – right Phil? But what about all those other places with bubbles Phil? I am still confused with your theory.
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June 27th, 2012 at 10:01 pm 97
@Phil: “it was pretty obvious where you were going with that leading question”
I’m assuming you meant “Asian” to mean people born in Asia. Please indicate if otherwise.
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June 27th, 2012 at 10:04 pm 98
Eugen Klein, President Real Estate Board of Greater Vancouver, writes to the Sun today:
“Just the market facts are the real estate board’s focus”
http://www.vancouversun.com/business/Just+market+facts+real+estate+board+focus/6846800/story.html
Isn’t this the guy who said that Maple Ride SF home prices went up 30% in a year after the Alex Fraser Bridge was built? Refuting his own organizations publicized stats?
Oh, yeah. Same guy: http://www.vancourier.com/Blaming+Chinese+high+house+prices+Vancouver+racist/6417310/story.html
Just the facts, mam.
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June 27th, 2012 at 10:06 pm 99
Buy a Tuscan village (well, ghost town) for about $3M. What would that get you in Vancouver?
http://www.theatlantic.com/technology/archive/2012/06/buy-your-very-own-tuscan-village-on-ebay/259072/
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June 27th, 2012 at 10:23 pm 100
@Phil: “Now consider the levels of immigration in the last 6 years and it’s safe to assume the white (the previous largest population) and Asian populations are even. ”
Thanks for conceding that your argument boils down to personal assumptions.
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June 27th, 2012 at 10:25 pm 101
@Phil: “There is a 6% other, which I’m not sure what that includes”
Good grief.
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June 27th, 2012 at 10:29 pm 102
@Phil:
What do you mean “accordingly increased”? You mean if the immigrants were from Europe, the price wouldn’t “increase correspondingly”?
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June 27th, 2012 at 10:32 pm 103
Any tips on where to looking for rentals?
Going through the usual places CL, Kijji, rental agents etc
Anyone find alternative resources?
looking in the westside area, Fairview, Mt Pleasant, and surrounding areas. Budget set at 1500 max for a 1bedroom.
Thanks in advance
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June 27th, 2012 at 10:39 pm 104
http://vancouver.craigslist.ca/
is a very good place to find rentals
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June 27th, 2012 at 11:18 pm 105
[Update from the Chinese Forum front] Richmond RE Pumper “GreatChina” calling for “Unity of Sellers” to prevent further price drops.
“A brand new house in good area of West Richmond, 8111 Dalemore Rd, was just sold for $1.58M, $170k lower than assessed price of $1.75M. It’s a shame that the buyer went through so much to purchase this property and build a new house, hoping to earn some money while doing a service to the community, only to have the buyer recklessly slashing price. I call on the sellers to withhold giving in to under-asking offers. We should all pull our listings and wait until a better market to sell in a bidding war situation”
HAHAHAHAHA
Current listing: MLS® V953065 http://www.ecorealtyinc.ca/listing?id=259508474
Purchase price: $533,000 Oct 2006 (old timer, was torn down and rebuilt as luxury mansion)
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June 27th, 2012 at 11:36 pm 106
@good-format:
Thanks!
I’ve been checking CL out, just seeing if others has other resources to share
I’ll share some of the ones I’ve found so far:
http://www.6717000.com/rental.html – Rental agent list
http://apartments.canada.oodle.com/
http://www.vancouver.nuuly.com/neighborhoods
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June 27th, 2012 at 11:54 pm 107
#95 @HAM Solo: “What say ye?”
Agreed. How about instead of “Crack Shack or Mansion?” we play “Contagious or Not?” Also, which of these have you seen on the Skytrain this week?
http://www.rxlist.com/quiz_contagious/quiz.htm
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June 28th, 2012 at 12:44 am 108
@new home: http://www.padmapper.com/ feeds in a few sites into google maps and has the best filters of any of the sites that do that.
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June 28th, 2012 at 6:01 am 109
[...] me to call her if I changed my mind about buying the unit. I could smell her desperation.” – pricedoutfornow at VCI 27 Jun 2012 3:08pm [...]
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June 28th, 2012 at 9:41 am 110
@frank:
“If we admit that the buyers-of-convenience whatever their hue are detrimental to life in this city, then we are stating a fact.”
Thank you, Frank.
I have stressed exactly what you say in past posts, being very careful to parse words and explain that I don’t care about where people come from (but only the effect of us all having to compete with their greater wealth) and still been accused of “looking for Chines under my bed”.
People react stupidly to any mention of any effect wealthy immigrants might have. Of course they are only a piece of the puzzle, but they *are* a piece and cannot be ignored as such.
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June 28th, 2012 at 9:46 am 111
@Devore:
“You mean if the immigrants were from Europe, the price wouldn’t “increase correspondingly”?
It doesn’t matter where the immigrants are from, nor what they look like. The problem is the high concentration of new “locals” in Vancouver which are much wealthier than average Canadians. It would be the same problem if they were from Portugal, or Mars.
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June 28th, 2012 at 11:00 am 112
[...] “On a business trip with a colleague from Victoria, who I knew purchased last year at the peak of the market. I mentioned how Vancouver prices were coming down, and that the Victoria market had already dropped. He agreed, and half heartedly lamented that he had bought at the peak. But in the next breath, he said it’s all relative, because if his house goes down so do all the others, so it makes no difference if prices go down. Amazing – so highly educated but failed to realize that with his 10% down, he would be underwater if he went to move or buy up. This “its all relative” mantra is really prevalent, even my own father believes this.” – Told Yous at VCI 27 Jun 2012 4:52pm [...]
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June 30th, 2012 at 5:16 pm 113
Phil
Whatever you do don’t mention “Asian” peoples on this website. They have not drastically increased home values particularly on Vancouver west Side or in Richmond.
These “Peoples” which can not be mentioned have not bought at any price as to expidite possible immigration issues.
These “Peoples” have not bought at any price in order to escape possible prosecution for embezzlement or theft back in “their” country.
These “People” have not bought several properties in order to secure and safeguard their new investments.
No Phil you are way off mister. There has not been a significant increase in immigration from the country of these “People”.
It does not matter that the fathers and grandfathers of Canadians fought and died in two world wars to resist the trype of tyranny and Fascism which embodies the homeland of these “Peoples”.
No Sir!! You just sit back Phil and let political correctness handle this one.
PS: The “People” embraces our political correctness
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