Friday Free-for-all!
It’s the end of another work week and that means its time for another free-for-all post. This is our regular end of the week news round-up and open topic discussion thread for the weekend. Here are a few recent links to kick off the chat:
-Why falling house prices aren’t bad
-What impact from the new rules?
-OSFI Credit Union loop-hole
-Absurd property of the week
-‘Just under a million’ price drops
-Expert rips Mayors housing report
-Fellow realtors complain to Keith Roy
-What does Cameron Muir think?
-Canada house prices not sustainable
-Affordable housing needs replacement
-Will we always have leaky condos?
-We ain’t Paris
So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!
..And if you’re interested in signing up for an account at Vancouverpeak.com, here are 10 first-come first-served invite codes:
kpzk-i5r8-v326 nuvi-7mmm-frra
pssw-zaks-5ses hjld-lzkk-0g9u
f9yq-szx6-tyu9 19×5-z7hp-bi6j
wvis-aj38-nioa wrjh-z7nz-tlb9
mdlv-5bdu-x52y x4fz-s6tv-p5de
July 13th, 2012 at 12:19 am 1
First. Wake up you bums.
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July 13th, 2012 at 12:50 am 2
Trying to decide between this ancient charmer:
http://www.realtor.ca/propertyDetails.aspx?propertyId=12094074&PidKey=652054330
Or saving $100k and going with this on Maui:
http://www.realtor.com/realestateandhomes-detail/1115-Kamehameiki-Rd_Kula_HI_96790_M78517-96856
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July 13th, 2012 at 12:53 am 3
@Dave: Third. Get a life.
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July 13th, 2012 at 2:14 am 4
http://www.guardian.co.uk/business/2012/jul/13/china-economic-growth-slows-gdp
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July 13th, 2012 at 5:56 am 5
Here’s another compare and contrast. For $699,000, you can get this in Scottsdale:
http://www.realtor.com/realestateandhomes-detail/11923-E-Beryl-Ave_Scottsdale_AZ_85259_M24005-93040?source=web
Or you can get this in Vancouver:
http://www.realtor.ca/propertyDetails.aspx?propertyId=12198934&PidKey=-1527704608
And the kicker is that you can write off the interest on your mortgage in the States. But why would anyone want to live in a state where it is sunny, dry and warm all the time when you could live in a city that is damp, cold and miserable 80% of the time?
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July 13th, 2012 at 6:11 am 6
@1 Dave: Hey Dave, re: ‘Expert rips Mayors housing report’, congrats on selling the concept of reduced development costs to the lululemon seat warmers on city council. Apparently not a one possessed the synapses to inquired how this one-time perk would halt a long term rise in prices, or whether that gift to developers would be immediately passed on to the public in the form of new units offered under market price. Questioning whether it would instead be pocketed by builders isn’t cricket I guess, or maybe they just lack the math.
Now they can go back to doing something useful, a chicken in every back yard and protecting the city from the wrong tint of teal glass.
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July 13th, 2012 at 7:06 am 7
Just so you know… I was curious what was the “disparaging” remark that Keith Roy made. I pulled up a Google Cache version and compared it to the latest version using the most excellent “Notepad++” with the compare plugin. All that was changed was one line which deleted a comment.
The original:
To ignore the truth doesn’t change the truth. And so it is in the Vancouver real estate lately. Far too often the real estate industry, of which I am obviously a part, makes excuses for slow sales periods, declining prices and difficult negotiations. These excuses are self serving. The facts are simple; real estate is easier to sell when prices are going up, realtors are happier when more houses are selling and open houses are more fun when buyers come to look. However, the good times pass like the bad ones do. I would suggest that good times have passed in the Vancouver real estate market, at least for the foreseeable future.
The edit:
To ignore the truth doesn’t change the truth. And so it is in the Vancouver real estate lately. The facts are simple; real estate is easier to sell when prices are going up, realtors are happier when more houses are selling and open houses are more fun when buyers come to look. However, the good times pass like the bad ones do. I would suggest that good times have passed in the Vancouver real estate market, at least for the foreseeable future.
Which deleted:
“Far too often the real estate industry, of which I am obviously a part, makes excuses for slow sales periods, declining prices and difficult negotiations. These excuses are self serving.”
I would say those lines are disparaging in tone. The fact is that the real estate industry doesn’t “make excuses” which are “self-serving” for slow sales periods alone. They also “give great reasons” which are “self serving” when the market is going Up, Up, UP!
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July 13th, 2012 at 7:36 am 8
Re: Housing Affordability
I have been looking at some co-ops in the area lately and have been consistently discovering that they are severely underfunded and basically all falling apart despite the efforts to keep them viable and livable made by dedicated people who run them.
Now, the body that should be mainly involved in these efforts – CHMC (whose sole mandate is to make housing for Canadians affordable) would rather do something else obviously, because the funding for those co-ops is simply no longer available.
The numbers that I discovered are simply astonishing – one of the local housing co-ops states in their latest newsletter that when they were first established (in 1985) there were receiving about $0.5 MIL in financial help a year from CHMC. Currently that number barely breaks $100K barrier…
So my question is:
Since 70% of Canadians are now homeowners and they pay hefty premiums to our CHMC so it can make housing affordable for the rest of us – WHERE THE FUCK IS THIS MONEY GOING???
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July 13th, 2012 at 7:51 am 9
@Eddie – Take off your kilt and buy the Cedar Cottage property. When are you ever again going to have the opportunity to buy a property needing just a “full reno” in east Van for a meagre $1.1M? The Maui property comes with 2 acres that you have to care for and your view is ruined by the ocean.
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July 13th, 2012 at 7:55 am 10
Check this out…apparently real estate CAN wreck your retirement in Canada. Who woulda thunk it?!
http://business.financialpost.com/2012/07/13/when-real-estate-wrecks-your-retirement-plan/
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July 13th, 2012 at 7:56 am 11
@vanpire:
CMHC premiums are not supposed to assist those who aren’t homeowners, they are supposed to cover mortgage defaults by the homeowners who paid the premiums.
The general feeling in the bear community is that the premiums aren’t enough to cover the likely amount of defaults going forward and that CMHC may require “assistance” from the taxpayers.
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July 13th, 2012 at 8:01 am 12
Yeah no reason for Canadian Real Estate to be as healthy as it is..this site has to be the biggest collection of idiots on the internet.
http://www.cnn.com/2012/07/13/us/midwest-drought/index.html?hpt=hp_t1
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July 13th, 2012 at 8:02 am 13
@Anonymous:
That’s Edmonton folks – you know the place with all that oil. The property is down almost 10% which means that they bought it near the peak.
The financial advisor wisely recommends that they sell and cut their losses. But how much do you bet that they will drain their other assets to hang on to it, because they’re not “giving it away”.
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July 13th, 2012 at 8:07 am 14
@vanpire: “Since 70% of Canadians are now homeowners and they pay hefty premiums to our CHMC so it can make housing affordable for the rest of us – WHERE THE FUCK IS THIS MONEY GOING???”
Huh? CMHC is there to provide banks with insurance against defaults on mortgages. The money is invested to pay out once the defaults come. CMHC was not intended to subsidize housing Coops although they may have done that in the past. If CMHC is cutting funding for this I say great. That is not part of their mandate IMO. All of the funds collected for CMHC insurance are going to be needed in the next 5 years to pay out defaults.
A simple answer to the Coop funding problem is to raise fees the members pay each month.
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July 13th, 2012 at 8:23 am 15
@Jigs Up: “A simple answer to the Coop funding problem is to raise fees the members pay each month”
Cooperatives typically pay 400bps or more spread on their mortgage debt and CMHC has been mandated to refund some of this spread to cooperatives who adhere to good practices. This would put these cooperatives in line with private strata units in terms of operating costs. If a cooperative is seeing its funding reduced it was likely mismanaged and CMHC cut them loose to fend for themselves in the wild.
CMHC ends its operating agreement with cooperatives in 2020, after which point cooperatives are on their own. So yes they have decided they don’t want to subsidize housing in that way.
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July 13th, 2012 at 9:16 am 16
@Jigs Up
“CMHC is there to provide banks with insurance against defaults on mortgages. The money is invested to pay out once the defaults come. CMHC was not intended to subsidize housing Coops although they may have done that in the past. If CMHC is cutting funding for this I say great. That is not part of their mandate IMO.”
CMHC is Canada’s national housing agency. It’s role is far bigger than just providing mortgage insurance, although that certainly is one of its most important roles. CMHC should support/encourage a broad spectrum of housing that fulfills the various housing needs of a country as vast and diverse as Canada. Part of the reason why we have got into this bubble in the first place is because of our social obsession with just one form of housing: ownership housing. We are now at the point where 70% of Canadians own. A far healthier situation would be to have more renters in the mix and more options for rental housing. CMHC has long participated in co-op housing and public housing. Until just a few years ago, CMHC held title to all section 35 public housing projects in BC. In 2006, CMHC transfer title of these lands to the BC govt. The BC govt is now in the process of privatizing and redeveloping our public housing, with Little Mountain in Vancouver being the first example. Of course, that redevelopment/privatization has turned into a disaster and the site has just sat empty for years (don’t get me started on that one). CMHC has participated in public rental housing since the early 1950s. I am certain that when CMHC was first created in 1947 it was understood that the agency would support a variety of forms of housing and its role would not be limited to providing mortgage insurance.
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July 13th, 2012 at 9:27 am 17
Essential reading for anyone interested in the formation of CMHC, its mandate, and the choices policy makers made in the 1940s and 50s that shaped the trajectory of housing development in this country for the rest of the 20th century and beyond is this book:
John C. Bacher (1993). Keeping to the Marketplace: The Evolution of Canadian Housing Policy, Montreal & Kingston, ON: McGill-Queen’s University Press.
When you read that book, you will see that it didn’t have to be this way. We didn’t have to have a housing system based on ownership/speculation/ponzi schemes. That could have been one component. But we could have had a system that promoted more rentals, more coops, more public housing, more private sector rentals developed through Limited Dividend Corps. We have had a little bit of that, but it’s now being dismantled. There’s all sort of tools at policy makers’ disposal to create a range of different housing options. We could have followed a more European model. The preference for title ownership housing was a policy choice made in the 1940s for a variety of reasons.
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July 13th, 2012 at 9:31 am 18
God you people are stupid….
http://www.chinadaily.com.cn/opinion/2012-01/05/content_14384093.htm
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July 13th, 2012 at 9:33 am 19
@Joe_Blown_Away_By_High_Housing_Costs:
Let me get this straight. You make housing more affordable by collecting a fee from one group of people (first time home buyers who need CMHC insurance) to give to another group of people (Coop members). How does that make sense? Anyone who needs CMHC insurance probably does not have a lot of money otherwise they would have a bigger down payment. Why tax them to give to someone else? This makes buying less affordable but living in coop more affordable. Is that what we really want?
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July 13th, 2012 at 9:45 am 20
@Jigs Up:
I wasn’t talking about making housing more affordable. I was simply explaining that CMHC has a much broader mandate than simply providing mortgage insurance.
I can’t provide you with an education on the development of Canadian housing policy in blog posts. That’s why I cited that book by Bacher. It’s a fascinating read that will teach you a lot. I learned a lot from that book. I’m not exactly sure how CMHC is funded, and how it has been funded in the past. Certainly in the early days, I wouldn’t expect mortgage insurance premiums to have been the biggest source of funding because Canada had far fewer owners back in the 1940s when CMHC was first created. Funding probably came directly from the federal govt.
But yes, having more people live in rental housing (whether that be public housing, private sector, co-ops, or non-profits) would put downward pressure on real estate prices because it would mean less demand for ownership real estate. Part of the reason why young people today have overextended themselves to buy overpriced homes with 5% down payments is because the rental options are just not there. The quality of rental housing is crap. Developers haven’t been building rentals. People are essentially forced into ownership because the supply of housing in this country increasingly comes in the form of ownership housing. So if CMHC were truly fulfilling its mandate, it would use the policy options at its disposal to increase the supply of rental housing. It’s no coincidence that rental housing supply is not given much thought by CMHC when the current board of directors are all real estate developers. These developers have perverted the role of CMHC so now people like you just think it’s only a mortgage insurancer. NO, it’s supposed to promote a variety of forms of housing–that’s how it was originally set up and that’s how it acted for decades through the 50s to the 80s. It’s only in the neoliberal era we are living in now that the wolves are guarding the hen house and the developers have taken over CMHC and turned their backs on promoting rental housing.
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July 13th, 2012 at 9:50 am 21
@fixie guy:
Nobody should care what a communist from the UN says about the Vancouver market.
In the short run, lower development costs don’t get passed onto the consumer because the first number of units don’t increase supply. However, over time, more supply does result in lower costs. Economics 101.
Vancouver has expensive housing for a number of reasons, a lot of which are related to municipal policies. Trust me when I say that we can build lower cost housing. These are choices we make. Until people start understanding that taxing doesn’t magically produce free money, we will be stuck in the present situation. The alternative is to elect the NDP, crash the economy and take housing with it.
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July 13th, 2012 at 9:51 am 22
@Jigs Up: ” Why tax them to give to someone else?”
What makes you think CMHC is explicitly mandated to funnel MI premiums to subsidize other programs? Many cooperatives have operating agreements with subsidized housing agencies, it’s likely that cooperatives are seen as a form of subsidized housing that would get government monies in other ways.
The mortgage insurance clusterf*ck that CMHC has right now is decades younger than most of its other subsidy programs, so it’s strange how the latter should die due to the former. It sounds more like the government has been transferring hidden taxes onto its speculation-hungry citizens and pulling some accounting tricks to make it look like its debt is under control. And that trend did not start with the CPC.
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July 13th, 2012 at 10:00 am 23
@Jigs Up:
He didn’t say that CMHC should use (or has used) mortgage insurance premiums to fund forms of housing other then equity homeownership. I think you’re confusing his post with #8.
IMHO if there’s any place where CMHC’s government guarantee could be used to genuine benefit it’s in financing forms of housing such as co-ops where speculative gains by the residents are not possible.
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July 13th, 2012 at 10:01 am 24
@vanpire: “Since 70% of Canadians are now homeowners”
70% of households own their residence. There are about 12m households, and 8.5m of those own.
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July 13th, 2012 at 10:03 am 25
@Anonymous: No mention of budgeting for losses on rent or repairs. Not even a set amount each month for maintenance. You can bet the rental house is slowly falling apart under their watch.
CMHC helped cause the housing crisis by basically encouraging any average middle-class idiot to become a landlord. Thus adding to demand for buying rental housing, pushing up the costs for serious landlords.
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July 13th, 2012 at 10:03 am 26
@Dave:
“Vancouver has expensive housing for a number of reasons, a lot of which are related to
municipalfederal and provincial policies that provide easy credit and subsidize buyers”Better.
“Trust me when I say that we can build lower cost housing.”
You sure can, just like they’re doing in Las Vegas. All it takes is for the market to run out of buyers willing to pay excessive prices.
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July 13th, 2012 at 10:05 am 27
@Jigs Up:
Anyone who needs CMHC insurance probably does not have a lot of money otherwise they would have a bigger down payment.
If they do not have enough money, they have no business owning a house in a first place.
But they should have alternatives to forced home ownership – and this is what I believe CMHC should provide, rather than insuring speculators’ mortgages just so the banks are fine in the end.
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July 13th, 2012 at 10:16 am 28
Comment #22 by jesse is bang on. I especially like the sentence: “The mortgage insurance clusterf*ck that CMHC has right now is decades younger than most of its other subsidy programs, so it’s strange how the latter should die due to the former.”
I also agree with comment #23 by patriotz.
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July 13th, 2012 at 10:18 am 29
Comment #27 by vampire is a good one. Sorry if these posts are annoying, peeps. These comments are so good that clicking thumbs up wasn’t sufficient commendation.
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July 13th, 2012 at 10:22 am 30
@21 Dave: No disagreement on ridiculous notions about a ‘rights’ based housing market, an oxymoron if I’ve heard one. Kothari also seems completely out of touch with stats showing rents lagged the yearly maximum increases for a very long time.
I just love that Mayor Happy Planet now leverages that talent towards selling the ‘Econ 101′ concept of stimulating residential development by jacking up developer profits for as long as it takes to create sufficient excess supply to cause demand, and therefore price, to finally fall. How long do you estimate developers will suffer the burden of making more money? Five years, ten, fifteen? Dammit, at least someone in this city has the cojones to step up and make crazy coin for Vancouver’s greater good.
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July 13th, 2012 at 10:29 am 31
@Manson:
Thanks for fitting right in
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July 13th, 2012 at 10:40 am 32
Most already know Vancouver housing is pricey.
I don’t think it’s productive to post examples of houses in markets such as Scottsdale and Maui.
As much as I am a bear, these are not comparable cities to Vancouver.
Cities like San Fran, LA, Seattle, Portland are more suitable.
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July 13th, 2012 at 10:59 am 33
@kansai92:
“Cities like San Fran, LA, Seattle, Portland are more suitable.”
Every one of which is cheaper than Vancouver. Seattle which is bigger is 1/2 the price and Portland which is about the same size is less than 1/2.
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July 13th, 2012 at 11:22 am 34
@kansai92: Does Vancouver have companies like Google, Apple, Oracle, Facebook, Genetech, Bechtel, Wells Fargo, Safeway, Cisco, Sun, eBay, Intel, AMD, URS, Levis, etc?
http://thestreetsmartfool.wordpress.com/2007/05/29/fortune500-largest-companies-ca/
But, of course, Vancouver has HAM. It’s land is bounded by water and mountains — oh wait SF bay area is bounded by water too.
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July 13th, 2012 at 11:24 am 35
@kansai92:
“I don’t think it’s productive to post examples of houses in markets such as Scottsdale and Maui.
As much as I am a bear, these are not comparable cities to Vancouver.”
Should have also pointed out that Scottsdale is a pricey suburb in metro Phoenix, population over 3 million. Local comparable would be the North Shore.
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July 13th, 2012 at 11:30 am 36
The palpable fear in this thread:
http://thethirtiesgrind.com/2012/07/11/absurd-vancouver-property-of-the-week-july-11-2012/
(Fake HAM post, real estate professional lashing out angrily on a bear blog then trying to pretend he had been impersonated by a character assassin…) led me to consider the position of and empathize with a hypothetical real estate professional in his or her local community:
1) He may have served as a de facto investment advisor for tens or hundreds of families regarding largest and most important financial decision of their lives. (“Do you think this crack shack is really worth 1,400,000?” “Of course! Appreciation has been 20% per year for several years and my analysis proves* that it will go on that way indefinitely. The worst case scenario is a plateau, followed by more price appreciation. If you don’t buy now, you’ll be priced out forever. HAM. Not making more land. Interest rates going up. Permanent new paradigm. Renting is a waste of money, but paying interest on 7 figures of bank debt is not! Sign here, here, here, and here.”
2) He has published his name, address, and phone number online. He is never anonymous or just a clerk following instructions: instead, he developed a personal and trust-based relationship with each of his clients before holding their hand through every step of a deep and risky financial commitment.
3) He is now slowly realizing that he is on the verge of seeing hundreds of past clients lose hundreds of thousands of dollars each. In fact, some of those clients will lose everything they have ever earned in their lives, and a few will have to work for 5 or 10 years before they get back *up* to having $0.00 to their name.
*I* believe in personal responsibility, and would never blame a real estate professional if I lost all my own money by doing something as stupid as buying a crack shack with a million-dollar bank loan.
In both my personal and professional lives, however, I have met plenty of people who might not see it that way. They might feel that they had paid that real estate professional $10k or $20k for a few hours’ work because he was giving this investment advice from a position of a) knowledge, b) experience, and c) qualification to give such advice.
In fact, some past clients may never fully understand that they were trusting an unemployed bartender with 5 weeks’ education on the subject — whose massive conflict of interest would get him fined and jailed if he were giving any other form of financial advice.
We all know that each property owner in the lower mainland is likely to have a sobering moment at some time over the next few years. For some, this moment will come at the bank when they are denied refinancing and advised that their six figure net worth has become six figures of indebtedness.
When that starts happening, I would not want to be in the shoes of the person who helped that client get into that position based on personal assurances of profit and success. I would not want to have to bump into that client at the grocery store or at Starbuck’s. I would not want to share a seat with that client on the bus.
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July 13th, 2012 at 11:38 am 37
just swing by to see what changed…nothing! still the same bunch of stupid bears and armchair economists killing time.
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July 13th, 2012 at 11:43 am 38
Vancouver is different, it has an endless supply of the worlds most valuable resource, water. When those zombies are out tanning,swimming and living it up in the great outdoors be smug knowing that once this sunny patch ends we Vancouverites will soon enough and once again be drenched in months of liquidity… Suckers!
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July 13th, 2012 at 11:45 am 39
32 kansai92 Says: “….houses in markets such as Scottsdale and Maui.”
Their relevance is as other markets priced predominantly as great places to live.
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July 13th, 2012 at 11:50 am 40
@TNT: ….Vancouver is different, it has an endless supply of the worlds most valuable resource, ….
Actually, I think the world’s most valuable resource is ‘suckers’ and if I had to guess, Vancouver’s world class supply has just about been fully tapped out.
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July 13th, 2012 at 11:57 am 41
@gokou3:
Vancouver’s GDP ($95billion) is also dwarfed by Seattle ($235billion):
http://en.wikipedia.org/wiki/List_of_cities_by_GDP
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July 13th, 2012 at 12:04 pm 42
@Vote Down The Facts:
1. 70% of total households are family-households. (27% are 1-person-households)
2. 70% of total households the place they live.
3. It can be assumed family-households are more likely (than 1-person-households) to own the place they live. (is there data on what % of family-households own, vs % of 1-person-households?)
4. They are approx 3 members in a family-household. (while 1 member in a single-person-household obviously)
5. Therefore, the % of individual Canadians living in a place where their household own is much higher than 70%.
correct?
“There were 12,437,500 households reported in the 2006 Canadian Census. The majority of people lived in family households (69.6%), a significant number lived alone (26.8%), and a smaller number lived with one or more unrelated persons (3.7%). The average size of a household in 2006 was 2.5 people. ”
http://www4.hrsdc.gc.ca/.3ndic.1t.4r@-eng.jsp?iid=37
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July 13th, 2012 at 12:22 pm 43
@Anonymous: Vancouver’s GDP ($95billion) is also dwarfed by Seattle ($235billion)
Yes, but judging by the prices people are willing to pay for rotten little houses our weed is WAY better.
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July 13th, 2012 at 12:54 pm 44
Thx for the code
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July 13th, 2012 at 1:17 pm 45
@Dave:
“The alternative is to elect the NDP, crash the economy and take housing with it.”
That’s right Dave, we will elect the NDP.
The other 2 events will happen before the first.
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July 13th, 2012 at 1:36 pm 46
Random sample of 10 sales recorded today.
9 sold prior to July 09, 1 sold after.
We’re going to need another week to know where the market stands.
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July 13th, 2012 at 2:00 pm 47
@burnabonian:
Wow… scary stuff. Thinking about what desperate unemployed and foreclosed bitter people with nothing left to live for as their lives crumble around them are capable of doing if they can find a focus to blame their misery on… I would want to be skipping town right about now if I were that realtor.
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July 13th, 2012 at 2:00 pm 48
@Best place on meth:
“The other 2 events will happen before the first.”
A recession and a housing market that is clearly in trouble in Vancouver is Crusty’s best scenario for re-election IMHO. Doesn’t mean it will work though.
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July 13th, 2012 at 2:01 pm 49
@TPFKAA: Like that guy who shot his former landlord who evicted him…
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July 13th, 2012 at 2:06 pm 50
@patriotz:
2 nitpicks:
1. Krusty was never elected, therefore can’t be re-elected.
2. She has zero chance of being elected under any circumstances.
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July 13th, 2012 at 2:27 pm 51
@VMD:
Correct. But that’s not the same as saying 70% of Canadians are homeowners. 70% of the population roughly equates to every single person over the age of 25.
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July 13th, 2012 at 2:35 pm 52
K how about this beauty in lovely Kitsilano
http://www.yattermatters.com/homes-for-sale/?area=Vancouver%2BWest&community=Kitsilano&type=Residential%2BAttached&bedrooms=Any&bathrooms=Any&minprice=200000&maxprice=900000&nonce=08cbe82de9&search=true&submit_x=87&submit_y=10&listpage=11&prop=V935716
or this beauty in one of the hippest areas of Manhattan
http://www.realtor.com/realestateandhomes-detail/175-W-93rd-St-Apt-1g_New-York_NY_10025_M42268-61172
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July 13th, 2012 at 2:36 pm 53
@Best place on meth:
Agreed. Who woulda thunk that a government could out do the incompetence of the NDP. I had a long conversation with Christy before she took over the Liberal leadership about how the NDP were their own worst enemy in this province. We laughed. Now everyone in this province is laughing at her as she’ll go down behind Gordie as an even bigger disaster. And Gordy’s situation wasn’t even about incompetence as it was more about calculated arrogance…
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July 13th, 2012 at 2:37 pm 54
@TPFKAA: A few years ago, I heard about a guy in Michigan who walked into a real estate office, calmly walked up to an agent, and shot him in the back of the head. Don’t know the full story, but we can imagine it.
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July 13th, 2012 at 2:40 pm 55
@Meh: Oh here we go: http://www.zimbio.com/Troy+VanderStelt/articles/6/Disgruntled+73+Year+Old+Real+Estate+Client
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July 13th, 2012 at 2:50 pm 56
@Meh: Whoa. That’s heavy. Bubbles really are tragic.. end so many lives figuratively and some literally, it seems.
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July 13th, 2012 at 3:07 pm 57
New Listings 226
Back On Market Listings 16
Price Changes 156
Sold Listings 116
ALL LOWER MAINLAND – NOT INCLUDING CHILIWACK
AS OF 3:10PM
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July 13th, 2012 at 3:10 pm 58
@vangrl:
Interesting sales history on that Manhattan apartment :
November 12, 2008 – sold for $492,000
July 22, 2005 – sold for $430,000
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July 13th, 2012 at 3:35 pm 59
@Vote Down The Facts: Need me to provide links showing some Manhattan homes being sold at 50% off previous transaction price?
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July 13th, 2012 at 3:41 pm 60
@Vote Down The Facts:
Zillow says it (or something like it – it might not be rentable itself) would rent for $3,315/mo (which means the asking price is too high by about $100K IMHO).
What would the place in Kits rent for?
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July 13th, 2012 at 3:45 pm 61
@Vote Down The Facts:
Agreed it’s not the same as saying 70% of all Canadians (from age 0-120) are homeowners. A more useful number however, would be the % of Canadian adults who are home owners:
1. let’s start with 100 households. 70 are family-households, 30 are 1-person-households.
2. of the 70 family-households, 3 people/family, let’s just assume 1 dependant, 2 adults. = 140 adults.
3. of the 30 1-person-households, = 30 adults.
4. Assuming 75% of family-households are home owners. = 105/140 adults
5. Then 60% of 1-person-households are owners (so that 70 out of 100 Total households are owners- that’s fact). = 18/30 adults
6. Total adult home owners: 123. Total adults: 170. Ratio:72%
7. 72% of adult Canadian population are home owners..
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July 13th, 2012 at 3:51 pm 62
@TNT: Yes, in my North Van house we call it “skiing season”, and we LOVE it!
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July 13th, 2012 at 3:57 pm 63
that place in Kits with no parking and no outdoor space might get MAX $1600….probably more like $1300
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July 13th, 2012 at 4:01 pm 64
@Jigs Up:
You say this as if this was some new concept you discovered. Substitute CMHC and coop housing for any public service/subsidy/wealth redistribution scheme, and you’re asking the same question. How does taking money from one group of people and giving it to another make anything more affordable? Well, we, as a society, believe that it does, so we will die trying.
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July 13th, 2012 at 4:26 pm 65
So howz the pre-sale market these days? Here’s ONE example from the Moda development by Polygon which went on sale couple weeks ago. A second-story unit. Interpret it however you like:
Unit #207, 2BR 907SF
Listed on MLS V959498 on June 28 for $409k:
http://mlslink.mlxchange.com/DotNet/Pub/EmailView.aspx?r=111463043&s=BRC&t=BRC
Listed again on MLS V962233 just now for $379k:
http://mlslink.mlxchange.com/DotNet/Pub/EmailView.aspx?r=985330751&s=BRC&t=BRC
$30k drop in two weeks. I wonder how much stock Polygon has left on their hands?
Someone would vote down the facts and say listing prices don’t matter. I beg to differ and say this clearly indicates the negative market situation.
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July 13th, 2012 at 4:39 pm 66
http://www.hollywoodreporter.com/news/villa-under-the-tuscan-sun-sale-296457
Wondered how much he purchased this property for in 2006? These people made millions like I am making cents.
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July 13th, 2012 at 5:00 pm 67
There’s nothing like a little weekend real estate propaganda for a good laugh. It turns out that cashed-up investors are flooding back into the Australian property market. One agent alone has literally sold hundreds of properties! These must be prime houses if the granny flat at the back doubles your rent.
“A St Marys agent said he had sold “hundreds” of $250,000 homes where granny flats were being added to double the rent. Some buyers were building two granny flats.”
I love these Fairfax media clowns, if you had only been listening to them you would be shocked to learn the market has been going down for the past two years:
“The senior economist at the Fairfax-owned APM, Andrew Wilson, said investors had recognised that the bottom of the market was the end of last year.”
This is really amazing stuff since the Australian Bureau of Statistics had prices falling 1.1% in the first quarter of 2012, down 1.8% in Sydney. Maybe these investors are just confused by what a market bottom is.
“‘There are lots of positive indicators that Sydney housing is starting to grow, particularly at the lower level,’ Dr Wilson said.”
And this had nothing to do with the NSW government eliminating stamp duty concessions on existing homes under $600,000 on 30 June? That’s some top notch analysis there Dr Wilson.
http://smh.domain.com.au/real-estate-news/investors-quit-shares-for-bricks-and-mortar-20120713-221c1.html
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July 13th, 2012 at 5:11 pm 68
The drop of million dollar listings
http://vancouverpricedrop.wordpress.com/2012/07/12/just-under-a-million-july-12-2012/
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July 13th, 2012 at 5:23 pm 69
@rksleung:
Kind of silly to spend nearly $12 million dollars on a 500 year old pile of rocks in Tuscany, when you can get a brand new house close to Marpole made of…….uhh…..I’m not sure exactly what the material is but I’m sure it’s something very modern.
http://www.realtor.ca/propertyDetails.aspx?propertyId=11510743&PidKey=837047231
Oh, it has a wok kitchen!
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July 13th, 2012 at 5:26 pm 70
New Listings 236
Price Changes 139
Sold Listings 99
TI:19208
http://www.laurenandpaul.ca
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July 13th, 2012 at 5:32 pm 71
@Devore: “You say this as if this was some new concept you discovered. Substitute CMHC and coop housing for any public service/subsidy/wealth redistribution scheme, and you’re asking the same question.”
Wrong. Typically taxation is progressive. This scheme would be taxing the least wealthy home buyers (those that have 20% dp). Far different from any other tax I have heard of where the poorest people pay it all. If you taxed every home sale and it was progressive based on value (like the PPT or HST) that would be different and you could make a case for it.
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July 13th, 2012 at 5:44 pm 72
@paulb: Boom Goes the dynamite!
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July 13th, 2012 at 6:09 pm 73
I was sayin last time how I sold the last of my 3 places recently and how happy I was to be out of the market. That’s certainly true but to be honest I was a bit worried about how it might impact my ego having to convert to being a renter and the feeling that I might be throwing money away. Well I’m happy to say it’s fantastic renting! All of the problems I used to have to spend all of my spare time fixing – the hundreds of trips to Home Depot, etc, not just on repairs but filling the house with things that perfectly outfitted it. At first I missed those trips but now I realize all the money I was spending. When renting we don’t have to worry about how the place looks because we might need to sell one day. And all the time and energy I’m saving allows me to be doing what I should really be doing – spending time with my young kids. I realize now how much I’ve been missing!
When values were rising of course RE was the place to be but now – renting is. So if your situation is anything like mine don’t be afraid to rent! And the money invested can pay your rent and then some..
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July 13th, 2012 at 6:17 pm 74
Excuse me of I am reporting. I cannot seem to find my previous post.
I am in whistler and I must say compared to last year at the same time it is dead. Is greed killing the resort??? Has it become too expensive?? Just musing.
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July 13th, 2012 at 6:35 pm 75
@Best place on meth:
note special feature: embedded oven!
wow.
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July 13th, 2012 at 6:45 pm 76
@gokou3: “Need me to provide links showing some Manhattan homes being sold at 50% off previous transaction price?”
What for? I just thought the price history on the Manhattan apartment was interesting. I wasn’t trying to make the point you thought I was.
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July 13th, 2012 at 7:11 pm 77
@fixie guy:
I would say five years, which is a little bit more than a development cycle.
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July 13th, 2012 at 7:31 pm 78
Does anyone have a rough ratio of how many of todays sold are pre July 9? I am shocked at how long it takes these “professionals” to enter a sale! Embarrassing.
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July 13th, 2012 at 7:34 pm 79
What actually drove the market back up in 2009? I hope this time is real to make the pricing back to what is really sustainable and not a repeat from 2010 and 2011
Never understand what made people started to buy and speculate back in 09.
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July 13th, 2012 at 7:37 pm 80
@VMD:
Sounds about right to me.
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July 13th, 2012 at 7:54 pm 81
http://www.theglobeandmail.com/news/world/vancouver-condominium-kings-face-charges-in-hong-kong/article4416665/
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July 13th, 2012 at 8:09 pm 82
Nothing demonstrates religious piety better than a giant Noah’s Ark with fibre glass and a rooftop luxury hotel:
“Devout evangelical Christians, they are the co-heads of a family business empire that is among the most powerful in Asia, but has also been plagued by vicious infighting and a bizarre kidnapping that caused a shift in control of a fortune estimated at more than $18-billion (U.S.). Now, brothers Thomas and Raymond Kwok are facing possible prison time after being charged with bribing one of Hong Kong’s top government officials in what is the biggest corruption scandal to hit Asia’s financial capital in years…the Kwoks funded the construction of a 450-foot Noah’s Ark replete with 70 pairs of glass-fibre animals and a rooftop luxury hotel.”
http://www.theglobeandmail.com/news/world/vancouver-condominium-kings-face-charges-in-hong-kong/article4416665/
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July 13th, 2012 at 8:27 pm 83
Some of you may recall my story about our ex-landlord Impulse buying a 1.3 million dollar house… Well they take possession at the end of July and he has posted this ad the last two weeks for one of the 2 illegal suites. (the other suite, sold to them as a 3 bedroom is getting converted to a 2 bedroom, a decision he made after we pointed out there was no living room to speak of, and the 3rd bedroom was actually a converted garage!!!)
http://vancouver.en.craigslist.ca/bnc/apa/3123219858.html
Of note, in our old place we paid $1500 for a 3 bedroom with Utilities included, Sure it didn’t have all that fancy stainless steel and granite countertops, but we didn’t have to park our couch in the kitchen either
We smoked outside and had a dog and 2 cats, and we were such good tenants they wanted us to move to the new place with them. Now this ad asks for no pets, no smokers, big references, and 30% Utilities??? I think we may see them get less picky as time drags on…
This will not end well…
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July 13th, 2012 at 8:51 pm 84
Interestingly, an ‘investor’ would have made a lot more $ if they just fixed it up a bit…
The property last sold in 2009 for $529,000
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July 13th, 2012 at 8:52 pm 85
oops forgot the link
http://tinyurl.com/6rpmgt4
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July 13th, 2012 at 9:15 pm 86
Not sure if this has been posted.
http://www.samwyatt.com/Blog.php/july-market-update-am-i-too-late-to-sell
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July 13th, 2012 at 9:35 pm 87
The excuse of the weekend: The weather is too nice…
—-I love this kind of weather—-
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July 13th, 2012 at 9:53 pm 88
@vanpire:
“Since 70% of Canadians are now homeowners and they pay hefty premiums to our CHMC”
All the talk about 70% of Canadian being homeowners….
To clarify, that stat is including people that have mortages on the property, yes?
The bizarre popular usage of the term “homeowner” has come up before… If prices go down far enough, it will be interesting to see recent buyers of properties (who put down minimal downpayments)… be underwater (owe MORE than the full value of their home) yet still be called “homeowners”.
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July 13th, 2012 at 10:12 pm 89
@Crikey: I propose that “Homeower” would be more apropos.
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July 13th, 2012 at 10:37 pm 90
Vancouver condominium kings face charges in Hong Kong
http://www.theglobeandmail.com/news/world/vancouver-condominium-kings-face-charges-in-hong-kong/article4416665/
….unfortunately Bob Rennie not one of them
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July 13th, 2012 at 10:57 pm 91
Another realtor
http://www.samwyatt.com/
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July 14th, 2012 at 12:42 am 92
@Vote Down The Facts: “I just thought the price history on the Manhattan apartment was interesting. I wasn’t trying to make the point you thought I was.”
Interesting in what way, care to elaborate? And what point you thought I thought you were making?
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July 14th, 2012 at 1:27 am 93
@good-format
From his latest monthly update:
“Vancouver’s real estate market is getting and is going to get hit from both ends. So, now that you are thoroughly depressed, here is the bright light: IF YOU SELL NOW, YOU WILL STILL BE SELLING NEAR THE TOP OF THE MARKET. If you plan to sell, you will need to price BELOW the most recent comparable sales prices. If you don’t do this, your listing will stagnate. I am pleased that this methodology has produced 4 sales in the last 30 days for my clients in a market were most homes are not selling.”
Great to see another realtor actively getting the message out and driving the market downwards. I think they’ll be instrumental in spreading the fear.
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July 14th, 2012 at 2:17 am 94
@GonePeteTong:
Another realtor prisoner’s dilemma. Falling prices result in lower sales volume across all realtors and both factors result in lower total commissions. But if I’m the first realtor to get my clients to drop their prices and sell, I increase my commissions at the expense of the others.
Don’t you just love greedy people.
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July 14th, 2012 at 4:41 am 95
@patriotz: “Don’t you just love greedy people”
Sounds more like a realist.
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July 14th, 2012 at 5:16 am 96
79 Anonymous Says: “What actually drove the market back up in 2009?”
Mark Carney.
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July 14th, 2012 at 8:29 am 97
@fixie guy: Don’t forget Harper and F.
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July 14th, 2012 at 9:02 am 98
@97 crabman: That’s normally beating a dead horse for me but here it’s unclear how much F&H could contribute by 2008-2009. All the data – HPI, sales volume, monthly price and sold volatility – went crazy in 2006. What response was left other than manipulating interest rates? 50 year mortgages?
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July 14th, 2012 at 9:09 am 99
@patriotz: “But if I’m the first realtor to get my clients to drop their prices and sell, I increase my commissions at the expense of the others.”
It is not at the expense of others. The other realtors will not sell their listings regardless if their clients don’t drop the price. Do you think there is a set amount of sales that will happen regardless of price? That would have to be the case if it was at the expense of others. We could have record sales volumes for real estate right now if prices came down far enough. If more realtors did what this guy is doing it would help increase commissions because sales would increase. Sales only remain sluggish because people are slow to drop prices.
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July 14th, 2012 at 9:37 am 100
@fixie guy: “What response was left other than manipulating interest rates?”
We have the pre-release of the playbook, we only need look to the US to see what will occur. That they are tightening mortgage availability now will be clawed back once prices start dropping in earnest. In addition there will likely be tax breaks for FTBs, cramdown schemes, and other schemes. Many of these were used in Canada in the early 1980s, the last time the CMHC ran into major solvency problems.
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July 14th, 2012 at 9:38 am 101
@gokou3:
What’s interesting about is it that particular apartment seemed to defy the market as a whole. What’s unique about it? Location? Or is the owner
just incredibly unlikely to sell at their current asking price, and the previous data points just happened to be well-placed?
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July 14th, 2012 at 10:29 am 102
A friend in Squamish is trying to sell his place…..not a single viewing even after an open house. They are leaving SQ and so have to sell. Now they are looking at drastic price reductions (below their existing mortgage)or holding it as a rental until the ‘market turns around’ (his words, not mine). I feel for the guy and his family, but this is an example of what happens when you buy at the peak of a bubble.
The Aqua development in SQ still has units available, even after the significant price reductions. There are early purchasers in there that paid nearly a 100k more for the privilege of ownership than a present day buyer.
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July 14th, 2012 at 10:46 am 103
@Anonymous: $100k here, $100k there, pretty soon you’re talking about real money!
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July 14th, 2012 at 10:58 am 104
Thanks to everyone for posting the stories about the pain people you know who are either having a difficult time owning or a tough time selling. Those are so much fun to read I share them with my wife. Makes that morning coffee just a bit better
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July 14th, 2012 at 11:28 am 105
Anyone else catch The House on CBC this morning? Tsur Somerville and Patti Croft, mostly falling over one another with the usual “not-a-bubble”, but with some pretty bearish sentiment lurking beneath the conciliatory tones (considering the sources):
- Nationally speaking, they see a 10-15% overvalue.
- They openly admit that this national number is mostly be driven by Vancouver and Toronto, implying enough overvaluation there to significantly sway national numbers.
- Patti recommends cashing out and is thinking about it herself.
- Tsur seems to have given up on recommending metrics and now suggests “if you like it, buy it”.
- Even though there’s no bubble, Canada will earn a feather in its cap by successfully engineering a soft landing.
Also, apparently you now need 50% overvaluation to have a national bubble.
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July 14th, 2012 at 11:38 am 106
@Navin R. Johnson: Agreed! It’s not about joy in other peoples misery, it’s about joy in other peoples misery over their own choices that until recently some thought you were crazy not to be making the same decision.
It’s a vindication and thats quite nice on a sunny Saturday morning.
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July 14th, 2012 at 11:40 am 107
#105 @Many Franks: “Also, apparently you now need 50% overvaluation to have a national bubble.”
I sort of agree with this. 50% overvaluation equals 33% drop. By traditional measures (which they are reverting to in the US) we have that level of overvaluation now.
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July 14th, 2012 at 11:48 am 108
@rp1: I don’t mind the number, it’s just weird to suddenly have a new and arbitrary definition thrown out there.
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July 14th, 2012 at 11:49 am 109
@Vote Down The Facts: Oh well… let’s just say I find news of Manhattan units selling at 50% off more interesting than this particular one being sold at flat price that you found interesting about.
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July 14th, 2012 at 1:34 pm 110
@Jigs Up:
“It is not at the expense of others. The other realtors will not sell their listings regardless if their clients don’t drop the price.”
Obviously some of the other realtors will get their clients to drop their price and get sales. There are always sales.
The point is that the realtor who gets his clients to drop first sells at a higher price and likely gets a higher volume than the others.
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July 14th, 2012 at 1:35 pm 111
@Many Franks:
All definitions are arbitrary. By definition.
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July 14th, 2012 at 1:39 pm 112
@patriotz: True enough, and I know you’re being facetious, but when I hear “we’re not in a bubble because a bubble would be 50% national overvaluation” I have to wonder if I missed an important sentence or two en route to that conclusion.
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July 14th, 2012 at 1:45 pm 113
June 2012 sales and inventory stats have now been published by your friendly neighborhood BCREA, and I have calculated Months of Inventory (MOI) for your bearish pleasure.
BC Northern
Inventory: 3042
Sales: 422
MOI: 7.2
Chilliwack
Inventory: 1871
Sales: 191
MOI: 9.8
Fraser Valley
Inventory: 8954
Sales: 1389
MOI: 6.4
Greater Vancouver
Inventory: 19606
Sales: 2398
MOI: 8.2
Kamloops
Inventory: 2390
Sales: 195
MOI: 12.3
Kootenay
Inventory: 3439
Sales: 205
MOI: 16.8
Okanagan Mainline
Inventory: 6827
Sales: 588
MOI: 11.6
Powell River
Inventory: 284
Sales: 28
MOI: 10.1
South Okanagan
Inventory: 2055
Sales: 128
MOI: 16.1
Northern Lights
Inventory: 288
Sales: 58
MOI: 5.0
Vancouver Island
Inventory: 6951
Sales: 611
MOI: 11.4
Victoria
Inventory: 4232
Sales: 602
MOI: 7.0
Provincial Totals
Inventory: 59939
Sales: 6815
MOI: 8.8
Outside Vancouver
Inventory: 40333
Sales: 4417
MOI: 9.1
Here’s an interesting statistic: over the past few months the difference in MOI between Vancouver and the Rest of the Best POE has been gradually narrowing.
Dec 4.2
Jan 3.8
Feb 3.7
Mar 3.0
Apr 2.5
May 1.7
Jun 0.9
Given that the province’s nether regions remain mired deep in in a real estate ice age, this trend is likely more due to Vancouver’s weakening market than to a recovery in the rest of the province. Or maybe the market’s just taking a “breather” and will rocket ever higher in the coming months. I think I’ll go buy a 12 million dollar mansion in Marpole and find out.
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July 14th, 2012 at 1:49 pm 114
http://www.realtor.ca/PropertyDetails.aspx?&PropertyId=12201003&PidKey=650180260
I don’t think I have anything clever to say to this.
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July 14th, 2012 at 2:00 pm 115
@vanpire and
@Joe_Blown_Away_By_High_Housing_Costs Says,
Regarding the “forced home ownership” idea, that imho is the current housing crisis (what else can we call it) in a nutshell. People feel trapped into buying; it’s an idea that’s nurtured by the real estate industry (including banks); it’s an elegant articulation of everything that’s been wrong. That and “pure unmitigated human greed” working together and we got ourselves the current mess.
Thanks for the phrase.
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July 14th, 2012 at 2:03 pm 116
@Unemployed in Greenland: I look at those numbers in the Okanagan, and I think that no journalist has the right to say those markets are ‘heating up’. Those MOI numbers are horrible and only portend lower prices.
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July 14th, 2012 at 2:15 pm 117
@Anonymous:
Didn’t MOI used to be 20ish un some of those areas?
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July 14th, 2012 at 3:05 pm 118
Thought I would update PaulB’s chart using his last 3 days of number, to get the updated list/sell ratio, MOI and projected EOM sales.
———-
As of Jul-13-2012
Total days 21
Days elapsed so far 9
Weekends / holidays 4
Days missing 0
Days remaining 12
SALES
Sales so far 1058
Projected month end total 2468
NEW LISTINGS
Listings so far 2360
Projected month end total 5506
Sell-list so far 44.8%
MONTHS OF INVENTORY
Inventory as of July 10, 2012 19208
Current MoI at this sales pace 7.78
———-
The numbers will probably trend downward in the 2nd half of July though. Just IMO.
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July 14th, 2012 at 4:08 pm 119
112 Many Franks Says:“…wonder if I missed an important sentence or two en route to that conclusion.”
The missing sentences are: “Shazzam!”, “Abracadabra!” and “Sim sala bim!” The confusion arises from mistaking Tsur and company’s method for Science.
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July 14th, 2012 at 4:15 pm 120
@Many Franks:
Well talking about a “national bubble” is something different from talking about a “bubble”.
It’s individual assets that are in a bubble, whether it be an individual house or an individual company. And there is an accepted definition in finance of what an asset bubble is – the earnings of the asset cannot pay for its purchase price.
But a “national bubble” doesn’t really have an operational meaning in finance, because nobody goes out and buys all the houses in the country. One could quite rationally say that a country doesn’t have a national bubble unless properties in all markets are at bubble valuations – which would mean the US never had a national bubble because not all markets were overpriced.
The other thing is that once you get to the national level there are different aggregate metrics that you can use to confuse the issue.
You see that’s the kind of game these talking heads play – they try to stay away from any terminology that has an accepted objective meaning and on which they can be pinned down using clear numbers.
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July 14th, 2012 at 4:36 pm 121
@Vote Down The Facts: “Didn’t MOI used to be 20ish”
Seeeeasonaaaaaaalityyyyyyy….
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July 14th, 2012 at 4:49 pm 122
@jesse:
Here’s June 2011 for comparison, some places have improved whilst others have got much worse.
BC Northern
Inventory: 3215
Sales: 418
MOI: 7.7
Chilliwack
Inventory: 1828
Sales: 230
MOI: 7.9
Fraser Valley
Inventory: 8169
Sales: 1508
MOI: 5.4
Greater Vancouver
Inventory: 16194
Sales: 3317
MOI: 4.9
Kamloops
Inventory: 2301
Sales: 206
MOI: 11.2
Kootenay
Inventory: 3441
Sales: 232
MOI: 14.8
Okanagan Mainline
Inventory: 6928
Sales: 499
MOI: 13.9
Powell River
Inventory: 265
Sales: 38
MOI: 7.0
South Okanagan
Inventory: 2275
Sales: 145
MOI: 15.7
Northern Lights
Inventory: 356
Sales: 43
MOI: 8.3
Vancouver Island
Inventory: 6676
Sales: 672
MOI: 9.9
Victoria
Inventory: 4108
Sales: 596
MOI: 6.9
Provincial Totals
Inventory: 55816
Sales: 7904
MOI: 7.1
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July 14th, 2012 at 5:22 pm 123
@Vote Down The Facts: So which one of those regions has MOI 20ish? I’m not seeing it. Also sales volumes have a random component; at high levels of inventory MOI has increased sensitivity to sales variance.
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July 14th, 2012 at 5:53 pm 124
Hey Everyone,
Does anyone know a good bubble site for Toronto real estate? I will be moving there within the year after getting married and need to start tracking the data. While I am a little disappointed that I cannot watch the Vancouver meltdown, at least I got to witness the early stages.
Thanks in advance for any help!
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July 14th, 2012 at 6:34 pm 125
This is off topic, but it is a stunningly noteworthy example of the poor writing skills of Vancouver Sun writers. It’s hard to believe but this paragraph is actually in a Vancouver Sun article right now:
“Hitting the eartyh as we speak. It’s going on as scheduled. The chances of seeing it are not really all that high. The chance of originally is almost zero. There is a guaranteed society in Arctic….for Vancouver there is not a good chance of seeing it”
It’s the last paragraph of an article about the aurora borealis. This butchering of the English language is enough reason to boycott this newspaper.
http://www.vancouversun.com/technology/Aurora+borealis+could+seen+Lower+Mainland+Saturday/6932469/story.html
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July 14th, 2012 at 6:57 pm 126
@fixie guy: I thought I heard him mutter “klaatu barada nikto” but he seemed to have some trouble with the last word.
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July 14th, 2012 at 8:17 pm 127
@Toronto or Bust:
Here are two that I have enjoyed reading in the past
http://fmlistings.tumblr.com/
http://landlordrescue.ca/
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July 14th, 2012 at 10:30 pm 128
Could this be why we are in the state we’re in? Hardly an accomplishment affording payments with rates this low.
Keith Roy commenting in te comment section of this article,
“As for buying back in, I am less worried about the price of the home I purchase, as I am about whether or not I can afford it on a monthly basis – which is how most people buy homes. Once the price of the home I want gets to a point where I can afford it on a monthly basis, I I will likely buy back in. If the prices go down further, but interest rates go up, my monthly payment will remain the same. Monthly payments are the primary metric by which I will be purchasing a home”
http://thethirtiesgrind.com/2012/07/10/is-keith-roy-the-jerry-mcguire-of-vancouver-real-estate/#comments
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July 14th, 2012 at 10:35 pm 129
Not sure how common this is..
Decent looking condo rental listing on CL, until you read this:
“Oversea owner just back 1-2 months a year, last year just back 3 weeks.
mostly, you own the total unit”
It’s probably fine if the overseas owner is your close relative.. but having a stranger living with you for 1-2 months a year??
Cultural differences? Entitlement issues?
http://vancouver.en.craigslist.ca/bnc/apa/3134182170.html
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July 14th, 2012 at 11:25 pm 130
@VMD:
Their culture seems to allow this a lot easier (living with strangers). Foreign students seem to have no problem packing in 7 people in a 2 bedroom condo. Usually 2 in each bedroom, 1 in the den, 2 in the living room. I’ve seen it.
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July 14th, 2012 at 11:34 pm 131
@Joe_Blown_Away_By_High_Housing_Costs:
There is a good reason why nobody buys the Vancouver Sun anymore… It’s not because it’s free on the internet… It’s because it’s no longer worth reading.
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July 15th, 2012 at 12:06 am 132
@Anonymous: “Monthly payments are the primary metric by which I will be purchasing a home”
Joe Howmuchamonth!!! lolz
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July 15th, 2012 at 2:01 am 133
I am no longer sure where you’re getting your info, but great topic. I must spend a while finding out more or working out more. Thanks for wonderful information I used to be searching for this info for my mission.
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July 15th, 2012 at 2:52 am 134
@Anonymous:
Commenter: “Once the price of the home I want gets to a point where I can afford it on a monthly basis, I I will likely buy back in. If the prices go down further, but interest rates go up, my monthly payment will remain the same.”
No, jackass, it will go UP when you renew your mortgage.
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July 15th, 2012 at 8:41 am 135
A few weeks ago some posters mentioned that Sold signs were being left up for long periods. Keeping track in my hood and there are 2 sold signs that have been up at least a month. Ridiculous. I am tempted to paint over the “S” so the sign just says “OLD”. Incidentally, one of the Sold signs is from none other than our good buddy, Keith Roy.
Speaking of, funny that Keith is completely contradicting his own message. One minute he says that prices are overvalued and its time to sell but then the next minute he says its about the monthly payments and you should buy if you can manage the payment. Presumably he was handling his monthly payments on his townhouse before, so why sell? The guy has all his talking points covered for both buyers and sellers. Sorry, not buying this guy. He is no bear, just another shill who will say anything to get a sale.
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July 15th, 2012 at 9:12 am 136
@Anonymous:
The best advice five weeks of education can buy!
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July 15th, 2012 at 9:25 am 137
“He is no bear, just another shill who will say anything to get a sale.”
I’ll say!
And what he’s saying is complete nonsense, he’s contradicting himself left, right and center.
Does he really think that prices will change that much in 2 months for him to “be able to afford the monthly payments” on a place in Van West (he sold in East Van), and does he not realize that his monthly payments will fluctuate with rising rates, and that actually paying less for a place makes more sense than just buying a place based on what he can afford to go towards mortgage payments every month?
http://thethirtiesgrind.com/2012/07/10/is-keith-roy-the-jerry-mcguire-of-vancouver-real-estate/#comments
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July 15th, 2012 at 10:01 am 138
@Bo Xilai:
A Newspaper’s reputation for integrity is like a restaurant’s reputation for cleanliness, once lost it is hard to get it back.
The Sun lost it’s integrity when Israel Asper bought it and every other newspaper in Canada except the Globe and Mail and took over the Editorial policy of each one, firing anyone who stood up for integrity and a free press.
Even though he no longer owns is the paper sullied by his years of control.
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July 15th, 2012 at 10:15 am 139
@Anonymous:
“The Sun lost it’s integrity when Israel Asper bought it and every other newspaper in Canada except the Globe and Mail”
You forgot the Toronto Star and of course the French-language press.
Also IMHO Asper just finished the job that Conrad Black started.
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July 15th, 2012 at 10:23 am 140
“If the prices go down further, but interest rates go up, my monthly payment will remain the same.”
He is commenting even if interest rates go up the payment will be the same due to prices coming down for buyers not those who are already holding a property. That would be impossible and a 5 year old child can understand that. It may be poorly worded but the meaning is obvious.
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July 15th, 2012 at 10:29 am 141
@Anonymous: “The Sun lost it’s integrity when Israel Asper bought it”
The old newspaper business model is broken. It really is not about who owns it. It just cannot compete with the internet so costs have to be slashed and the quality suffers. It turns into cheap generic news and advertising. Just like record stores and dvd rental stores. They are a thing of the past due to cheaper and easier delivery of the same content over the internet.
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July 15th, 2012 at 10:57 am 142
yes the old news paper model is broken, but the new model of google news and yahoo news relies on links from real news firms. Sadly every news firm that is being linked to has a bias.
ie. Reuters: see wikileaks fiasco
Sun, Province, Star, etc: Asper/Canwest
Guardian, BBC: UK Government
CBC: Canadian government
Al Jazeera: Saudi Arabia
Whole lot of somethings in UK, US, Australia: Murdoch
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July 15th, 2012 at 11:06 am 143
Now available: “luxury ground floor penthouse”
Only $12000 per month. Penthouses are hard to find but to get one on the ground floor is extremely rare.
http://vancouver.en.craigslist.ca/van/apa/3140657329.html
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July 15th, 2012 at 11:21 am 144
@patriotz: “Once the price of the home I want gets to a point where I can afford it on a monthly basis, I I will likely buy back in. If the prices go down further, but interest rates go up, my monthly payment will remain the same.”
No, jackass, it will go UP when you renew your mortgage.
One would hope that a Realtor would know that renewing a mortgage at a higher rate makes the payment to up. I think he was trying to say that it doesn’t matter if prices go down and interest rates go up before he buys because his monthly payment would be the same.
But that would only be true for a zero down Joe Howmuchamonth. Anyone with a down payment would benefit from starting with a larger down payment.
If I have a $100k down payment and a $400k place becomes a $300k place (happening all over BC in the last few years). Then I don’t have 25% down, I now have 33% down.
If I was paying less for rent than the cost of owning (strange yes, but I heard it does happen!) and saving the difference while price were falling, then I’m even further ahead.
In my case I save around $20k year, so in the above scenario after about three years my down payment has gone from 25% to 50%.
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July 15th, 2012 at 12:17 pm 145
@Anonymous:
What you think he was trying to say is at odds with what he actually said:
He’s saying that he will buy at a particular payment point and then if prices go down further with higher interest rates, i.e. after he has bought, his monthly payment will remain the same.
I have to admit I really don’t know that he was trying to say, as what he said makes little sense in toto, as others have pointed out.
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July 15th, 2012 at 12:26 pm 146
@T:
“Guardian, BBC: UK Government”
The Guardian is certainly not biased toward the UK government of today, as it has always been the leading left newspaper in the UK.
It was supportive of the Blair government until the invasion of Iraq, which it opposed. For example:
The Iraq war is finally over. And it marks a complete neocon defeat
Thanks to the toppling of Saddam Hussein, Iran’s greatest enemy, Tehran’s influence in Iraq is stronger than America’s
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July 15th, 2012 at 12:33 pm 147
141 Anonymous Says: “It just cannot compete with the internet so costs have to be slashed and the quality suffers.”
Media slashing began when I was still programming on punch cards. The Internet has an impact for sure but they’ld be in a much better competitive position had they concentrated on more than just cost cutting for decades. Granted, Vancouver print media is a bad example to judge by, it was below fish-wrapper level in the early 2000′s when I first moved west.
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July 15th, 2012 at 12:33 pm 148
@T:
“Sadly every news firm that is being linked to has a bias.”
Absolutely. The sad part is that there are still many people that don’t realize it, and still swallow the BS from organizations like the Vancouver Sun (eg. real estate pumping stories).
An acquaintance that moved to Canada after having lived in communist Russia for many years reflected on the irony or the state of MSM in the free world…
In communist Russia, the MSM regularly served up tons of BS, but at least the public knew to treat it as BS, to question it to themselves.
In our free world, the MSM serves up tons of BS, but most of us don’t realize it is often BS, should be questioned.
At least… with the internet we can very quickly see debating perspectives from different news organizations… Now if only people could understand they need to do that.
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July 15th, 2012 at 12:41 pm 149
@Crikey:
This reminds me of a saying that is popular in Russia and other former post-Communist states:
“Everything they told us about communism was a lie; unfortunately, everything they told us about capitalism was true!”
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July 15th, 2012 at 1:43 pm 150
@Crikey: “At least… with the internet we can very quickly see debating perspectives from different news organizations… Now if only people could understand they need to do that.”
Most people I meet devote way more brain cells to analyzing minutiae of the Canucks than to understanding the news. I don’t think they have any interest in thinking or debating about the news. They’d rather be spoon-fed whatever Global and the Sun decide to give them. I don’t see that changing any time soon.
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July 15th, 2012 at 2:03 pm 151
The mainstream media offers to relieve people of the burden of thinking. It works until it doesn’t.
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July 15th, 2012 at 2:06 pm 152
#145 @patriotz: “I have to admit I really don’t know that he was trying to say, as what he said makes little sense in toto, as others have pointed out.”
I’ve a feeling we’re not in Kansas any more
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July 15th, 2012 at 2:15 pm 153
#140 @Anonymous: “If the prices go down further, but interest rates go up, my monthly payment will remain the same.”
I have no idea how anyone could believe this. It’s a non sequitur. I understand that prices and interest rates could somehow in tandem to maintain equilibrium in the monthly payment. But why would that happen?
Maybe prices fall, the economy contracts, jobs are lost, interest rates fall, and monthly payments fall further as deflation takes hold.
Maybe prices and interest rates both rise and monthly payments skyrocket as hyperinflation takes hold.
Maybe prices fall and interest rates go nowhere or vice versa. Maybe prices rise and interest rates go nowhere or vice versa. Maybe prices and interest rates go nowhere but monthly payments change due to amortization schedules.
Why in the world would monthly payments have to be preserved? When has this ever happened?
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July 15th, 2012 at 2:38 pm 154
Anyone want to bet the LIBOR scandal doesn’t stop at our borders? This will be an interesting story to follow. http://www.winnipegfreepress.com/business/competition-bureau-probes-possible-canadian-connection-to-libor-scandal-162522586.html
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July 15th, 2012 at 3:42 pm 155
Even though Keith Roy had to edit his blog to remove the comments he made about the self-serving RE industry, those comments are still in the mainstream media.
http://business.financialpost.com/2012/07/05/tepid-numbers-spur-call-to-cash-out-of-housing-market/
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July 15th, 2012 at 3:47 pm 156
@Patriotz
“And there is an accepted definition in finance of what an asset bubble is – the earnings of the asset cannot pay for its purchase price.”
As you probably know, I think RE here in the BPOE is overvalued and due for a fall. That said, this definition has got me thinking. Under this definition, gold or art or other similar non-productive but valuable and/or collectible goods would always be in a bubble, wouldn’t it?
These goods have a culturally imposed worth beyond the fundamental utility. In cases like gold, this imposed cultural premium has been persistent for millennia, although it does fluctuate, this fluctuation has never brought the value of gold into line with its true utilitarian/productive value.
In that context, I wonder to what extent RE is a hybrid of a true productive asset and an asset that bears a culturally imposed value (aka the ownership premium). I think we’ve gotten well past a rational ownership premium in RE, but it seems this is also the case with gold at present (and Damian Hirsch art, but that’s another story).
So, the question is, to what extent is the value of RE culturally driven vs speculator-driven. When does speculative pricing become culturally engrained? Is there a way of figuring this out? While I’m sure the price of RE is too high for rational buyers, I’m not as steadfast as others here in my belief that the price will revert to the equivalent of its value relative to rents or even historical multiples of income (too many things that used to be expensive to produce have become cheap to buy, freeing up a greater % of income to put towards housing).
Anyways, lots of smart folks on here with more knowledge than I. I’d be happy to hear thoughts on whether the price will truly revert to the equivalent of rent, whether it is possible that RE is a hybrid asset as I’ve described, and it so, what’s a rational culturally driven premium over the value as defined by a property’s actual productive worth vs other investment types.
Cheers!
JL
PS: this was typed on an iPhone. Apologies in advance for any autocorrect errors I missed.
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July 15th, 2012 at 4:02 pm 157
@Just looking…: “Under this definition, gold or art or other similar non-productive but valuable and/or collectible goods would always be in a bubble, wouldn’t it?”
All of those things are definitely subject to severe corrections and are a speculation as an investment. One key difference is people do not usually buy them at 20 to 1 leverage.
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July 15th, 2012 at 4:32 pm 158
@Keith Roy
“If the prices go down further, but interest rates go up, my monthly payment will remain the same.”
if prices go down further but interest rates go up, Keith Roy’s new West Side residence will be worth a lot less than what he paid for it in the fall, and on renewal of his mortgage he will as well be looking at higher mortgage payments. Icertainly hope he’s not telling his clients what he’s telling himself.
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July 15th, 2012 at 4:33 pm 159
None of this is going to end well everthing is manipulated, the housing markets, Libor, banks, GDP’s, metals, food, fuel.
Got to look at the big picture, it’s a house of cards.
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July 15th, 2012 at 4:51 pm 160
@Just looking…: Anything that has resale value can be in a bubble, even if it doesn’t generate income/earnings (eg. tulip bulbs). And just because something doesn’t generate income doesn’t automatically mean it has to be in a bubble, although it is definitely tougher to know whether or not you’re in one.
For income generating assets (stocks, bonds, RE), you can easily detect a bubble using fundamental analysis (the study of fair value). One way is when valuation ratios exceed 2 standard deviations from their long-term trend. You can also crudely time a turning point in price using technical analysis (the study of supply & demand). For RE, fundamental analysis means looking at incomes, rents, debts, etc; technical analysis means looking at sales, listing, inventory, MOI, etc.
For non-income generating assets (commodities, currencies), it’s very tough to use fundamental analysis. Instead, you’d have to rely on technical analysis to both detect a bubble and time the turning points. Rough way to detect a bubble: extreme bullish sentiment, price exceeds 2 standard deviations above it’s long-term trend, overbought indicators, etc. Detecting turning points include break of support/resistance trends.
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July 15th, 2012 at 5:03 pm 161
For sh!ts and giggles (and because of the rain) we went to a couple of open’s in our west van hood, 3M, 4M and 1.9M each.
The 1.9M is a lovely Ron Thom westcoast mid century piece, the realtor was awesome. She said the market has completely flipped 180 degrees. Things have changed compared to a year ago. The days of bidding wars are done. Good to hear frank, honest insight instead of fluff.
The 3M and 4M places were a reno and rebuild respectively. Both pretty hideous quality for the price. Outrageous.
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July 15th, 2012 at 5:05 pm 162
if prices go down further but interest rates go up, Keith Roy’s new West Side residence will be worth a lot less than what he paid for it in the fall, and on renewal of his mortgage he will as well be looking at higher mortgage payments. Icertainly hope he’s not telling his clients what he’s telling himself.
_______
I certainly hope he IS telling his clients what he’s telling himself….
The more people with hubris that get screwed over the faster the collapse and the better off everyone will EVENTUALLy be….
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July 15th, 2012 at 5:17 pm 163
@VMD:
“‘Oversea owner just back 1-2 months a year, last year just back 3 weeks.
mostly, you own the total unit’
It’s probably fine if the overseas owner is your close relative.. but having a stranger living with you for 1-2 months a year??”
Lol that’s… kind of awkward in a 1 bedroom. Who gets the couch?? It works ok for young students – pretty much any young people will sleep three to a room to cut down on housing expenses when necessary. From personal experience I’ve found this to be true of English, Czechs, Mexicans, Italians, Spanish, Finnish, Germans… don’t know how that shit works for Canadians but I would imagine it’s no different. When you are young it’s all an adventure.
It may be a young owner in their 20s expecting a similar tenant. But imagine if it’s a 40 yr old, set in their personal habits… brrrr. So awkward. And it doesn’t appear to be any cheaper than market. I would expect at least 30% off for that arrangement.
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July 15th, 2012 at 5:20 pm 164
@ScubaSteve:
“Their culture seems to allow this a lot easier (living with strangers). Foreign students seem to have no problem packing in 7 people in a 2 bedroom condo. Usually 2 in each bedroom, 1 in the den, 2 in the living room. I’ve seen it.”
And who exactly is the “they” in “their”? I doubt young Canadians overseas would be too snooty to do what the rest of the world has no trouble doing when young and tight of budget.
But if this is older adults… it’s just creepy.
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July 15th, 2012 at 5:27 pm 165
@Just looking…:
“So, the question is, to what extent is the value of RE culturally driven vs speculator-driven.”
You have your definitive answer from the US. When prices started tanking, the “cultural value” went away.
It was always about the money.
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July 15th, 2012 at 5:29 pm 166
@Just looking…:
That’s a really astute question. I have two observations:
1) I think even at the old multiples of income (3.5) most people end up paying over and above rental value due to all the costs of ownership… So the premium has always existed, but it has a tangible value for many people if only in status and the concomitant psychological well-being it brings.
2) That sense of value may take a temporary hit if the sustained drop in valuation due to credit contraction and deleveraging hurts people badly psychologically, as it did in the states. Therefore, people may lose all the interest in housing as a speculative asset, as they would in gold or paintings or tulip bulbs after a bubble, and lead to an overshoot of even the fundamental floor. This will probably be a cyclical oscillation, just like everything else, and we’ll come back around again to where houses are overly valued.
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July 15th, 2012 at 5:31 pm 167
@TPFKAA: I mean if this is older adults in the craigslist ad… one understands migrant workers can benefit from reduced living expenditures, while not necessarily liking the close quarters… needs must…
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July 15th, 2012 at 5:32 pm 168
@patriotz:
You beat me to it.
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July 15th, 2012 at 5:34 pm 169
@Just looking…:
“Under this definition, gold or art or other similar non-productive but valuable and/or collectible goods would always be in a bubble, wouldn’t it?”
You can say that they are always in a bubble, or you can say that it doesn’t make sense to say that they are or are not in a bubble. You can be bullish or bearish on them, but that’s not the same as saying they are or are not in a bubble.
But their prices are driven entirely by speculation all the time – the only return you get on them is from the next buyer. You could make an exception of sorts for art, since the owner enjoys an intangible benefit from it. But nothing you can use for an objective valuation.
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July 15th, 2012 at 5:35 pm 170
@TPFKAA:
You have failed to explain why landlords would hold an asset that continually loses money.
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July 15th, 2012 at 5:36 pm 171
@Just looking…: ” what’s a rational culturally driven premium over the value as defined by a property’s actual productive worth vs other investment types.”
There are properties that are art forms, notably those designed by famous architects or restored in period, so they would carry the “speculative premium” you describe. Arguably one could keep a pied-a-terre with fantastic sunset views as a piece of art as well.
But where this tends to fall flat is in units primarily rented, where those who rent them are doing so with leverage and keeping cash flow positive. In that respect the comparison to a work of art is wanting: they are rarely visited or even seen by owners, the only cachet is party conversation, a rather odd feather compared to most art forms with which I’m familiar.
Any drive through most of the Vancouver area reveals any comparison to works of art is more a state of mind, and one that I would describe as more convenient than real. From that point of view I’d describe Vancouver property as more a fad than anything timeless. JMHO.
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July 15th, 2012 at 6:52 pm 172
@patriotz:
Not quite following you there… status, psychological security, believing that your asset will appreciate, failure to account for all costs are all reasons for holding on to an asset that continually loses money.
Not sure if I was trying to explain why anyone would – can you clarify what you mean?
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July 15th, 2012 at 7:11 pm 173
Got a flyer from Tri-City Real Estate “expert”.
The flyer says: “Take advantage of this of this SELLER’s market”
He is either has mental problem or too poor to print new flyers that is suitable for today’s market.
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July 15th, 2012 at 7:13 pm 174
Sorry. Too many mistakes in previous post.
Got a flyer from a Tri-City Real Estate “expert” — Dan Miller
(604-729-0708)
The flyer says: “Take advantage of this SELLER’s market”
He is either has mental problem or too poor to print new flyers that is suitable for today’s market.
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July 15th, 2012 at 7:24 pm 175
Interesting to think about the Canadian MSM’s new meme about a 10-15% real estate overvaluation in Vancouver and Toronto. Here, I believe, is the thought process.
The real estate industry knows that Vancouver is already down 15% and that Toronto is softening (especially in the condo area) and so likely to follow Vancouver’s trajectory. They also are aware that the news of price drops is kind of predictable because the real estate industry deals in y-o-y numbers. So even if the sales price is flat for the next eight months, by the spring they will have no choice but to publish -15%.
Knowing this, the spin-meisters have to come up with a plan. Part of this is to change the basis of measurement (hello new HPI), but even these douche bags realize they can’t completely fabricate market prices. Ergo, the admission of over-valuation by the amount they estimate prices have already fallen from the peak.
The other advantage of spinning an over-valuation number is that if prices correct more than 15%, they have already been preparing the gullible for inevitable declarations of “undervaluation.”
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July 15th, 2012 at 7:29 pm 176
@VMD:
“‘Oversea owner just back 1-2 months a year, last year just back 3 weeks.
mostly, you own the total unit’
It’s probably fine if the overseas owner is your close relative.. but having a stranger living with you for 1-2 months a year??”
I think the CL poster is implying that the owner wants to keep a part of the unit as a storage area for his/her belongings. I see this all the time; an owner would rent out a whole house but keep the right to store his stuff in one room. They don’t want to pay for a storage locker and would rather give their tenant a discout for this type of arrangement.
But how this would work in a one bedroom apartment is beyond me. If they actually think they can rent out a one room apartment for that price and have the audacity to think they can crash there when they come back for vacation then I think somebody needs to put them in their place. I am almost tempted to call the poster to get the details.
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July 15th, 2012 at 7:48 pm 177
@Waiting to exhale: Yeah I would like to know too. I have a feeling it’s a young-ish person. They should really say what kind of person the tenant would expect to be sharing with and how.
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July 15th, 2012 at 8:23 pm 178
CBC: Canada froze $4.3B in assets to support Arab Spring
How is this relevant to Vancouver? It probably isn’t, but a few paragraphs jumped out at me:
Something to consider… if a foreign government were to clamp down on corruption in the wake of a financial collapse, the Canadian government has the means and will to act by recovering assets of foreign officials deemed to have illegally squandered state assets, in the name of maintaining a good relationship with, and supporting, a burgeoning trading partner.
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July 15th, 2012 at 8:39 pm 179
Just called poster of the CL ad. Apparently it is a two bedroom apartment and the owner wants to have exclusive access to one room (they will be locking it) so essentially you are renting a one bedroom 900 square feet apartment for $1480 with the added inconvenience of an owner popping in and out once awhile. I think this owner is dreaming if they want that rent for this kind of an arrangement. I think something around $1000 would be more realistic.
By the way the poster said the owner’s wife usually comes back alone if that makes a difference.
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July 15th, 2012 at 9:12 pm 180
Depends if she’s hot …
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July 15th, 2012 at 9:17 pm 181
@Waiting to exhale:
Crazy….sounds like he just wants someone to pay the mortgage when he’s away. I’m sure that’s how he priced it out. Jeepers. Renting a one bed isn’t worth anywhere near $1480/month.
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July 15th, 2012 at 10:13 pm 182
Fixer & Flipper Update
RE http://www.realtor.ca/propertyDetails.aspx?propertyId=12184842&PidKey=-163882389
Open housing today in the area and stopped in for a peak at this recent fixer and flipper,
If you want to laugh, barf, shake your head, or all a little of all i dare you to have a look at this joke of a reno’ed house, truly one of the worst i have seen,
on a side note it and the few other i was at were empty, one of them the realtor was a no show!
Getting interesting out there!
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July 16th, 2012 at 1:00 am 183
#179 @Waiting to exhale: “Just called poster of the CL ad. Apparently it is a two bedroom apartment and the owner wants to have exclusive access to one room (they will be locking it) so essentially you are renting a one bedroom 900 square feet apartment for $1480 with the added inconvenience of an owner popping in and out once awhile.”
Sounds like an axe murderer. The second bedroom is where they chop people up. You’re the fall guy.
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July 16th, 2012 at 3:03 am 184
@TPFKAA:
“status, psychological security, believing that your asset will appreciate, failure to account for all costs are all reasons for holding on to an asset that continually loses money.”
Your third point is the definition of a bubble. The other points are saying that the owner is simply a fool.
A bubble cannot be supported indefinitely by factors other then financial return, because there are always players who are interested only in financial return, or bound by it (i.e. will go broke) and when they divest themselves prices have to go back to a level that gives investors an operating profit.
As I said. I think all the “non-financial” reasons given for owning RE are bogus, because as we’ve seen from the US, when it clearly becomes a losing game people don’t want to buy.
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July 16th, 2012 at 11:00 am 185
[...] that paid nearly a 100k more for the privilege of ownership than a present day buyer.” – Anonymous at VCI 14 July 2012 10:29am Share: This entry was posted in 11. Regrets about Investing in RE, 14. Social Effects of the [...]
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July 22nd, 2012 at 6:15 pm 186
[...] allows me to be doing what I should really be doing – spending time with my young kids.” – No Noise at VCI 13 Jul 2012 6:09PM Share: This entry was posted in 02. Profiting from the Boom, 10. Demoralized Renters? and tagged [...]
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