Chinese buyers move to the USA
If you’re wondering why we haven’t heard as much about wealthy chinese buyers lately as prices drift down in Vancouver, maybe it’s because they’re moving to the USA.
“California has always been popular with Asian buyers,” he told beyondbrics. “But whereas before it was mainly buyers from Taiwan, Hong Kong and Japan, now we are seeing more mainland buyers visiting.”
Reasons for purchases vary, say those who have dealt with overseas Chinese buyers. Some are buying because they want to emigrate or they have children who will go to school in the US. More and more Chinese millionaires are looking to settle in the US or at least secure residency rights.
And why would they be buying in the US as opposed to Canada?
Others buy because the numbers add up: the renminbi is relatively strong against the US dollar and property prices are cheap compared to Australia or Canada.
But it’s not supposed to work like that! Wealthy people aren’t supposed to look for good deals..
Are they?
Read the full article on ft.com
July 11th, 2012 at 2:43 am 1
When the hubris of Vancouver RE speculator/suckers finally catches up with them, in the upcoming inevitable RE fall, how will they react?
Here is a very special glimpse at the scene that will be playing out in many heavily-mortgaged households across Greater Vancouver…
Note: you may want to substitute the words “National Association of Realtors” with “Global TV” or your RE-pumping clown of choice.
Also substitute the terms “Lehman and AIG” with “RIM”.
http://www.youtube.com/watch?v=bNmcf4Y3lGM
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July 11th, 2012 at 5:33 am 2
FTA:
“According to a report published by the National Association of Realtors this week, buyers from China and Hong Kong made up the second largest group of foreign buyers of homes in the US in the 12 months to March – behind only Canadians – accounting for $9bn of sales.”
This tiny nation is ahead of the global industrial behemoth a hundred times larger? That’s really disturbing, especially when the likely source of that play money is considered.
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July 11th, 2012 at 5:56 am 3
Most of the areas I monitor still haven’t come back to the inventory level seen on June 30th. Biggest exception is VanEast SFH. At 677, 16 higher than June 30th peak.
VE is right in that million dollar sweetspot that will be most affected by that aspect of the new CMHC rules. Do you think that’s why VE inventory is jumping ahead?
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July 11th, 2012 at 6:15 am 4
Very hard hitting article on Robson Street just appeared in the Vancouver Sun. Bramham is practically trash talking Robson in the Van Sun…
“There’s nowhere near the population base or wealth in this city to support many high-end retailers. Besides, Vancouverites’ fashion choices tend more toward Lululemon and Mountain Equipment Co-op.
So, our fashion street is anchored by Winners, the discount fashion retailer, and a blank-walled building that’s been derisively likened to a toilet bowl — which is soon to be vacated by the retreating Sears.
The city has done its preeminent shopping street no favours.”
http://www.vancouversun.com/life/fashion-beauty/Bramham+Robson+Street+sure+Champs+Elysses/6914127/story.html
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July 11th, 2012 at 8:03 am 5
“Chinese buyers move to the USA”
Who knows maybe lots of those ‘Chinese’ buyers in the USA are really Canadians.
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July 11th, 2012 at 8:06 am 6
@VHB: “Do you think that’s why VE inventory is jumping ahead?”
VE has seen a big run-up in the past year that has acted to reduce the differential between westside prices; more likely in my view it’s that people would like to sell at higher prices.
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July 11th, 2012 at 8:27 am 7
@fixie guy: “This tiny nation is ahead of the global industrial behemoth a hundred times larger”
Probably because the impact of Asian buyers was overstated from the start?
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July 11th, 2012 at 8:32 am 8
“California has always been popular with Asian buyers”
Parts of the US haven’t seen prices off significantly from their peaks, and these areas do include parts that have a high immigrant Asian population. The difference in the US is that overall prices have dropped, even if certain pockets have not, whereas Vancouver’s prices have remained elevated.
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July 11th, 2012 at 8:38 am 9
@Vote Down The Facts: It is simply because Canada was historically a better investment option since the 1990s … and until now (Canada didn’t have a real RE crash in 2007, remember?).
Now that the RE market is bottoming out in the USA AND topping up in Canada, the smart money is heading down south.
The times, they are a-changing
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July 11th, 2012 at 9:08 am 10
@fixie guy:
I bet the same can be said for RE in Vancouver.
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July 11th, 2012 at 9:10 am 11
@VHB: “Do you think that’s why VE inventory is jumping ahead”
Van East has done well over the past year. This coincided with the drop-off of Van West. I think the Van East surge can be attributed to prospective Van West buyers that were essentially priced-out-forever (in their mind anyway) and were forced to move East. It seems this wave of final fools has now been depleted and now it’s Van East’s turn for a ‘buyer’s vacation’.
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July 11th, 2012 at 9:27 am 12
Bear candy in bear country
http://vancouver.en.craigslist.ca/pml/reb/3132552969.html
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July 11th, 2012 at 9:32 am 13
I find this hard to believe.
http://vancouver.en.craigslist.ca/van/reb/3131506845.html
What is Rennie up to?
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July 11th, 2012 at 9:38 am 14
@Patiently Waiting: I have to say, that house is really great! I would lowball it at 750000$ (they lowered it by 200k. I’m sure they can take another hit!lol).
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July 11th, 2012 at 10:23 am 15
@Patiently Waiting:
10 acres with a nice large house in Maple Ridge for $975K actually sounds very reasonable compared to the asinine prices in Vancouver and its immediate surroundings.
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July 11th, 2012 at 10:29 am 16
@Patiently Waiting: “I find this hard to believe.”
The first tip should be an almost complete lack of information. If this were a good buy, disclosure would over this like white on rice.
Instructive because, if sales are in for a rough patch, I predict there will be a push towards much more detail in the listings to attract interest, when those buying are looking to make money the old fashioned way.
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July 11th, 2012 at 10:43 am 17
A few days ago, I cycled through Coquitlam, following the existing Transmountain pipeline. Most of the older houses near the pipeline have extra big lots with buildings less close to the pipeline. However, newer infill houses are going to be ripped down if the pipeline twinning is on the existing route.
A new house is being constructed on top of the pipeline
at Cottonwood and Colinet. Across the street from it, this house-for-sale could be on top of the pipeline http://www.ecorealtyinc.ca/listing?id=259540252
A few blocks away on Cottonwood, another brand new house with the pipeline running by the sidewalk a few feet in front of it.
Then it enters medium-high density low-income rental house, which may be an obstacle. Many buildings fairly close to the pipeline and a potential traffic nightmare around North Road and Evergreen Line construction.
Unfortunately, the smoky air is limiting my cycling now.
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July 11th, 2012 at 10:48 am 18
@Patiently Waiting: Anyone dedicated enough to find out which Rennie listing has a 50% reduction?
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July 11th, 2012 at 10:56 am 19
@gokou3:
50% off original asking price is meaningless. I have a paperclip to sell you. Original price one thousand dollars. Now 50% off!
That people fall for this shit is very telling. Why do otherwise intelligent people become suddenly lobotomized when it comes to real estate?
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July 11th, 2012 at 10:58 am 20
@Patiently Waiting:
Hmm, posting is from this Realtor.
Go to Pinocchio’s page and he has no current listings.
http://www.rennierealty.com/sa/pinocusati/listings
Perhaps he is dumping his own gem?
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July 11th, 2012 at 11:11 am 21
8 jesse Says: “Parts of the US haven’t seen prices off significantly from their peaks, and these areas do include parts that have a high immigrant Asian population.”
The Case Shiller HPI for Los Angeles, San Francisco and San Diego on the other hand all shed better than half the gains from their mid-Nineties trough. Which areas were you thinking as examples?
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July 11th, 2012 at 11:32 am 22
Spot the Intergenerational Specuvestor, Part I:
I had some drinks with a friend last night who told me about a friend (let’s call him Burnaby Joe) of his who has contributed to the craziness here in Vancouver. Burnaby Joe is in his mid-50s, born and raised on the east side of Italian parentage. He finished high school and has worked in the building trades his whole life. He owns his own home (probably mortgage-free) in Burnaby.
Anyway, my friend told me about Burnaby Joe’s pretentious and spoiled daughters–18 and 19 years old–who have almost as many shoes as Imelda Marcos in their “clothes room” at home. Each of these girls is as of recently the proud owner of a new condo in the North Burnaby area.
How many of these cases are around? How did Burnaby Joe finance the purchase of these two condos? Cash? HELOC? When the market turns will Burnaby Joe both the means and fortitude to hang on while equity drops monthly?
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July 11th, 2012 at 11:39 am 23
@fixie guy: “Which areas were you thinking as examples?”
Arcadia, Irvine, Cupertino, San Francisco City, off the top of my head. As I stated, the drops in major US cities on the west coast have not been homogeneous. This should not be a surprise; unemployment rates of higher income brackets are significantly lower than lower tiers. Vancouver, OTOH, is high across the region, a marked and important difference.
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July 11th, 2012 at 11:47 am 24
@gokou3:
“Anyone dedicated enough to find out which Rennie listing has a 50% reduction?”
I think the title is in error. If you read the body it says “Priced at $500k below assessed value” which means something quite different.
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July 11th, 2012 at 11:49 am 25
@Anonymous:
“Who knows maybe lots of those ‘Chinese’ buyers in the USA are really Canadians.”
Don’t think so. The numbers and charts in the article clearly refer to the country of residence of buyers, not ethnicity.
Could a lot of the Canadian (#1 by number) buyers be ethnic Chinese? Sure.
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July 11th, 2012 at 11:51 am 26
Commodities market is dead. Wonder how that is going to bode for Canadian RE……
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July 11th, 2012 at 12:04 pm 27
@fixie guy: Just did a very quick search on a property in Arcadia. Check out the 91006 zestimate, FWIW, only shows about -16% nominal change since peak in 2005. In real terms that’s -27%. Either these areas have yet to see the other shoe drop or are being supported through other means not ubiquitously present in the greater LA area. To get back to 2003 prices there would need to be another $100K lopped off current valuations in that zipcode.
http://www.zillow.com/homedetails/1120-Greenfield-Ave-Arcadia-CA-91006/20892737_zpid/
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July 11th, 2012 at 12:13 pm 28
V949635 is down From 870k to 800 k in two months. Let s wait until xmas…
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July 11th, 2012 at 12:17 pm 29
@jesse:
Well Zillow says 90210 (you know where) is also down the same %.
I think most US metros have areas that are down a lot less than the average, but that’s not very relevant to the ordinary buyer who would not be looking to live in them in the first place.
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July 11th, 2012 at 12:19 pm 30
@ jesse: If by ‘parts of the US’ the intent was a few outlier neighbourhoods in specific cities, sure, but what does that have to do with Asians holding up California? Standard & Poor’s make available for download Case Shiller data in Excel form which unambiguously shows the cities cited, including San Francisco proper, took a pounding.
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July 11th, 2012 at 12:21 pm 31
@jesse: “Arcadia, Irvine, Cupertino, San Francisco City, off the top of my head.”
But Cupertino has HAM – Hot Apple Money.
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July 11th, 2012 at 12:51 pm 32
re V949635
with this written on the listing:
“Motivated Seller. All offers considered.”
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July 11th, 2012 at 1:09 pm 33
Watch this for a good chuckle:
http://www.toddjackson.ca/MarketUpdate.html
“this perceived uncertainty combined with our lack of good weather…”
bwahahahaha
What a relief Todd. The serious tightening of credit is only a matter of perception.
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July 11th, 2012 at 1:17 pm 34
@fixie guy: ” If by ‘parts of the US’ the intent was a few outlier neighbourhoods in specific cities, sure, but what does that have to do with Asians holding up California?”
I never stated Asians were holding up California, rather that certain neighbouhoods populations have not seen valuations fall as much as the Case-Shiller city aggregate. Plausible reasons for this include foreign investment and low unemployment. If certain lofty areas have higher immigrant Asian populations, it’s plausible, but not certain, that capital flows from Asia have had a positive impact on prices.
And yes it didn’t save the rest of the region; the lessons learned for Vancouver should be that foreign capital flows are unlikely to be of sufficient magnitude to float all boats without concomitant debt accumulation (i.e. keepin’ up with the Joneses). Data outlining consumer debt levels indicate Vancouver is living on borrowed time.
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July 11th, 2012 at 2:36 pm 35
While other areas are seeing pressure, sales and prices in downtown Vancouver continue to be strong as I’ve always predicted. downtown Vancouver is a highly desirable place to live and will hold stead.
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July 11th, 2012 at 3:04 pm 36
It’s 2012 and “Vancouver’s Condo Leak Crisis” is on the landing page of the National Post:
http://fullcomment.nationalpost.com/2012/07/10/brian-hutchinson-vancouver-suffers-condo-leaks-of-olympic-proportions/
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July 11th, 2012 at 3:15 pm 37
@Rob A.: Did you not read Garth’s post on Shangri-La?
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July 11th, 2012 at 3:26 pm 38
@gokou3:
The person bought the place in the Shangri La for $3.1, and sold for $3.0. That’s one (high end) property selling for a 5% loss. Hardly a trend. The actual stats say that downtown values are (so far) holding up. But that may change at any time, like it did in 2008.
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July 11th, 2012 at 3:51 pm 39
@specialfx3000:
Offered at $1.77 M
2000 Sq foot
1499 West Pender
I don’t have the MLS number.
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July 11th, 2012 at 3:58 pm 40
@WFT?: …..It’s 2012 and “Vancouver’s Condo Leak Crisis” is on the landing page of the National Post:….
The caption in the photograph reads: “Repairing leaky condos. Never buy a Vancouver condo built between the years 1980 and 2000, went the rule of thumb.”
Funny, I though the rule of thumb was: Never buy a Vancouver condo built between the years 1300 and forever.
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July 11th, 2012 at 4:01 pm 41
@Vote Down The Facts: “That’s one (high end) property selling for a 5% loss.”
True, but the loss is from 2008. That is negative 5% return over 4 years. Not so good. Garth’s point on this one was a flip gone bad and he added in the holding costs. From what I see most downtown condos have been flat since 2008 but I think there will be price reductions showing up soon as many have been listed for years.
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July 11th, 2012 at 4:11 pm 42
Offered at $1.77 M
2000 Sq foot
1499 West Pender
I don’t have the MLS number.
____________________________________________________
Here it is. A 500K hair cut is about right over what this place would have sold for as a presale.
http://www.6717000.com/mls/V961484-2601-1499-w-pender-st.html
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July 11th, 2012 at 4:22 pm 43
Wonderful value. I really want it because I do not know how to spend my extra money.
Tax + Maintenance each month is: $1575
http://www.yattermatters.com/homes-for-sale/?area=Vancouver%2BWest&community=Any&type=Any&bedrooms=Any&bathrooms=Any&minprice=1500000&maxprice=2000000&nonce=66d2807447&search=true&submit_x=106&submit_y=12&listpage=16&prop=V961484
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July 11th, 2012 at 4:31 pm 44
@Vote Down The Facts: The person bought the place in the Shangri La for $3.1, and sold for $3.0. That’s one (high end) property selling for a 5% loss.
You just forget to mention that this failed flipper bought the place in 2008 and just sold it after an overall loss of about $500K. Carrying costs are a bitch, especially in high end buildings…
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July 11th, 2012 at 4:34 pm 45
Re: 1499 West Pender
Listing by Magnum Projects. It looks like the developer is blowing it out at $896 per square foot. That should make the other 11 unit owners happy who have their places listed. Some in the $1200 to over $1800 per square foot range. I guess that is where they get the half price. Can you imagine the feeling you get when you find out a comparable just listed for close to half your asking price per square foot. Ouch!
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July 11th, 2012 at 4:41 pm 46
@Anonymous:
Re: 1499 West Pender
Like this guy. Same size unit on a lower floor. Asking $2,998,000.
From the listing: “Sell At Cost. Be Hurry.”
I would love to be the person giving this guy the news the developer who sold him his place for 2.99 Million is selling a better unit for 1.77 Million. Ouch!
http://www.6717000.com/mls/V917105-502-1409-w-pender-st.html
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July 11th, 2012 at 5:42 pm 47
@Anonymous: We should all print off the lower offer and take it to a showing of the higher offer and say “hey Tom Vu, what’s up?” Oh what fun we are going to have!
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July 11th, 2012 at 6:53 pm 48
New Listings 222
Price Changes 140
Sold Listings 134
TI:19103
http://www.laurenandpaul.ca
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July 11th, 2012 at 7:05 pm 49
Canadian housing prices are not sustainable: David Rosenberg
Canadian home prices are on average twice the level of home prices in the U.S. Historically, average home prices had been close to parity. Rosenberg asks, “which of the two do you think is going to correct relative to the other?”
http://business.financialpost.com/2012/07/11/canadian-housing-prices-are-not-sustainable-david-rosenberg/
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July 11th, 2012 at 7:10 pm 50
My friend was trying to sell his Coquitlam TH as he’s changed jobs and leaving town. If he sells it for what the same units are going for in his complex he will lose money (he’s sunk over 45k into it on Reno’s over the last 5 years). He pulled it off the market, and is now trying to rent it for more way more than the equivalent units in his complex because his has be heavily reno’d.
Methinks there are many stories just like this out there, in the suburbs especially.
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July 11th, 2012 at 7:13 pm 51
Another on joins the $999,000 club. Was listed for $1,288,888 and then $1,198,000. Now $999,000. Gotta wonder how that effects the other houses in the hood.
http://yourvancouverrealestate.ca/mls-listings/3919-broadway-st-V960771
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July 11th, 2012 at 7:20 pm 52
@Makaya:
Please explain where the 500k loss comes from. You’re quoting Garth, and he never bothered to show his working either. What downpayment did they make, at what rate, we’re they an owner occupier or an investor? What was the rental income?
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July 11th, 2012 at 7:24 pm 53
http://www.vancouversun.com/sports/Lions+struggle+with+attendance+despite+start+season/6918049/story.html
People can’t afford frivolous expenditures like CFL tickets when they’re already spending North of 70% of their pre-tax income on housing…..
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July 11th, 2012 at 7:29 pm 54
@Vote Down The Facts:
Taxes/maintenance 2% at least, rental deficit 2% at least, 4% for 4 years is 16%, on $3mil that’s $480K.
Add PTT at purchase and RE commission at sale and you’re well over $500K. Easily.
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July 11th, 2012 at 7:37 pm 55
@Vote Down The Facts:
don’t feel like math today, here are some numbers for those who like to do math:
comparable unit on 58F Shangri-la
Listing price: $3,380,000
condo fee: $1663/m, or $19956/yr
property tax: $10782/yr
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July 11th, 2012 at 7:44 pm 56
http://www.cbc.ca/news/canada/toronto/story/2012/07/11/iranian-canadian-td-accounts269.html
Iranian-Canadians fume as TD closes accounts
Sanctions against Iran hit Canadian bank account holders
“She said her father also received a similar letter from the bank with regards to his mortgage and his personal line of credit.”
once their mortgages are dropped by TD will they have to qualify under the new mortage rules at a new institution?
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July 11th, 2012 at 7:51 pm 57
@Vote Down The Facts: “What downpayment did they make, at what rate, we’re they an owner occupier or an investor? What was the rental income?”
It was a spec flip. No rental income, no occupancy. Do the math.
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July 11th, 2012 at 7:53 pm 58
@Vote Down The Facts: Here is the message I posted last night:
Since you’re a bit lazy, here is a quick and dirty calculation I did for you:
Since he’s a flipper, he probably have put the minimum downpayment he could, but let’s get conservative and assume he put 20% down.
See, with my assumptions, I get $700K loss with doesn’t include insurance cost and GST (Shangri-La was a new built). I didn’t take into account inflation.
Now let’s assume the guy managed to rent out this place for $5k per month for 4 years, this unit would have fetched $240K. He probably had to pay some taxes on that investment, so for the sake of this argument, let’s pretend he netted $200K.
So here we are: $700K – $200K = $500K
Satisfied now?
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July 11th, 2012 at 7:57 pm 59
@Harry Wang: “once their mortgages are dropped by TD will they have to qualify under the new mortage rules at a new institution?”
Unless TD is interpreting the sanctions wrong they will not qualify with any Canadian institution. Either they come up with the funds or get foreclosed.
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July 11th, 2012 at 7:59 pm 60
@Anonymous: What a sucker! Don’t they know that Richmond is HAM central and nobody who buys there needs to take out a CMHC-backed mortgage?!?
This is another example that price is not the same as value. The value of these houses has not changed a white over the last few weeks. What has changed is the potential buyer’s access to credit.
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July 11th, 2012 at 8:08 pm 61
@Anonymous: “Was listed for $1,288,888 and then $1,198,000. Now $999,000.”
It seems 8s are so passe in today’s market. I think 9s are the new 8s.
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July 11th, 2012 at 8:20 pm 62
Metro Vancouver’s 50 affordable housing complexes will need replacement, but with whose money?
They shouldn’t be too worried, they already have lots of available space at the
Olympic VillageVillage on False Creek…Like or Dislike:
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July 11th, 2012 at 8:48 pm 63
@Makaya: “Since you’re a bit lazy”
If YOU claim it’s a $500k loss then the burden is on you to back that up. Thanks for doing so, that puts you a step above Garth.
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July 11th, 2012 at 8:52 pm 64
@Makaya: I assume they must have been putting funds aside into a capital fund when the buildings wear out. And if the mortgages are paid off they can refinance. If they managed their finances well there should be no concern whatsoever.
I see. This whole “affordability” mantra is so comical it’s tragic.
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July 11th, 2012 at 9:01 pm 65
@Jigs Up:
“It seems 8s are so passe in today’s market. I think 9s are the new 8s.”
And 6 figures is the new 7 figures.
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July 11th, 2012 at 9:21 pm 66
@Best place on meth: Red is the new black
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July 11th, 2012 at 9:54 pm 67
http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/five-silver-linings-in-falling-house-prices/article4409000/
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July 11th, 2012 at 9:59 pm 68
@jesse: down is the new up.
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July 11th, 2012 at 9:59 pm 69
@Joe_Blown_Away_By_High_Housing_Costs:
Interesting… clipped from the article:
“3. Maybe the foreign buyers will go away
Let’s not overstate the impact of condo and home buying by wealthy investors outside Canada, because definitive statistics are lacking. But there’s no doubt that in cities such as Vancouver and Toronto, money from offshore has helped bid up prices. A classic example is the drab three-bedroom bungalow in Toronto’s Willowdale neighbourhood that in March went for $1.2-million – $421,800 over the asking price. CBC reported that the buyer was a university student whose parents live in China. We welcome foreign investment here in Canada, but in the case of the housing market that money has fed a pre-existing over-exuberance. “
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July 11th, 2012 at 10:05 pm 70
@Rightsizer: Skytrain is the new Merco…
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July 11th, 2012 at 10:12 pm 71
@Makaya:
Vancouver East is the new Richmond…
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July 11th, 2012 at 10:12 pm 72
CBC: Iranian-Canadians fume as TD closes accounts
Capital flows are a cause of concern for the government, and Iran is a consistent source of wealthy immigrants. Sanctions are most likely politically motivated, but my guess is stemming capital flows is a nice-to-have.
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July 11th, 2012 at 10:22 pm 73
@Crikey: “Let’s not overstate the impact of condo and home buying by wealthy investors outside Canada”
Geese that could never happen. Where is all that HAM of late? Bloating inventories and price reductions on the Westside and in Richmond is all I hear about. The Helicopters have been grounded.
Nice to see the article point to the realtor stunt back in March that had the media print exactly what they wanted. The problem is the media missed the other 2000 sales that day across Canada bought by over leveraged locals. Of course those sales have no effect on the market but the one house bought by a Chinese student does because he paid over the purposely low set asking price. The media just happened to be there when the offer was presented. People are gullible.
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July 11th, 2012 at 10:46 pm 74
crossposted to vreaa as well.
http://business.financialpost.com/2012/07/11/canadian-housing-prices-are-not-sustainable-david-rosenberg/
more msm articles on unsustainable canadian house prices.
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July 11th, 2012 at 11:00 pm 75
Some insight (I may repost on tomorrow’s blog also as the day is about to turn over soon).
The new rules have definitely had some impact on moving the marginal buyer’s purchases forward. This is really sad as they stand to lose the most but you can see people are just driven to make any transaction and the possibility that they will lose this ability has forced their hand. The stats are now starting to include the sales since the annoucement date and a statistically significant change in the composition of sales has emerged. Here’s what we’re seeing.
1.) SFH sales continue to be slow and will almost certainly be lower in July than June and possibly up to 20% below last year.
2.) Condo sales have spiked such that July is on track for higher than last month by 10% and even higher than last year.
3.) Richmond is the worst performer on a comparative basis and the disaster thre is accelerating (may reach 20 MOI by end of month).
4.) *** The stat that is most telling is a large drop in the median price. The price we are seeing month to date on a comparitive basis to previous periods is lower than any individual week in the past year and about 10% below the 10 week average. This indicates a large number of purchases at the lower range of prices. This would be consistent with the first time buyer market most affected by the rule changes.
If these people are the last to get in – what happens in late July when these urgently made sales are no longer being reported and the remaining market participants (which are mostly in the market already) are not as active? Sales volumes will have to fall in the condo category as well and August could be one of the worst months we have seen in a while.
My model projects that we will end July with the same inventory as the end of June and this will likely be the same for August. MOI overall will come down over last month but this is entirely in the condo market and is seen to be temporary. Prices will not show the decrease we had seen in previous months and should flatline a bit. Some markets will however continue to fall quicker which are mainly Richmond and Van-West detached but now also West Van detached, North Van and Burnaby (the worst markets currently). Van-East currently is the only sub-segment which has not had an inventory decrease.
Off to Paris today – - – - Although the weather here has been pretty decent, it is typical Europe – you just don’t get a full day without rain. For those of you keeping tabs, Paris is a World-Class city.
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July 11th, 2012 at 11:48 pm 76
@ZRH2YVR: Paris is a World-Class city.
So it’s exactly like vancouver then? Do they have one of those good crepe places like on granville?
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July 12th, 2012 at 12:45 am 77
@Vote Down The Facts: No one has a burden to prove anything to you, especially if you aren’t appreciative of other people’s work after the fact.
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July 12th, 2012 at 3:01 am 78
@Makaya:
“Now let’s assume the guy managed to rent out this place for $5k per month for 4 years, this unit would have fetched $240K. He probably had to pay some taxes on that investment”
Please, how many times do I have to point out that expenses are deductible against revenues for a rental property. Assuming he had a mortgage, he was losing money and was able to deduct that against his other income.
Apart from that, thanks for the numbers.
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July 12th, 2012 at 5:26 am 79
69 Crikey Says: “Let’s not overstate the impact of condo and home buying by wealthy investors outside Canada…”
Agreed, where the owner lives pales in importance to where the money is earned. In terms of Canadian price sustainability, new wealthy immigrants almost certainly have a much greater, and much less sustainable, impact than tracked foreign speculation. Without a local economy of sufficient scale to justify them, inevitably prices come down.
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July 13th, 2012 at 11:00 am 80
[...] Methinks there are many stories just like this out there, in the suburbs especially.” – Anonymous at VCI 11 Jul 2012 7:10pm Share: This entry was posted in 11. Regrets about Investing in RE, 16. Missed The Boat? and [...]
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July 16th, 2012 at 4:01 pm 81
[...] turns will Burnaby Joe both the means and fortitude to hang on while equity drops monthly?” – oneangryslav2 at VCI 11 Jul 2012 11:32am Share: This entry was posted in 08. Overextended Buyers, 14. Social Effects of the Boom, 15. [...]
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