Friday Free-For-All!

It’s Friday!  The end of another glorious summer work-week and the weekend is calling.  This is when we do our regular end of the week news roundup and open topic discussion thread and as per tradition here are a few links to kick off the chat:

Inventory Graph slowing
Canada home price hits record
US prices to median $149,300
Vancouver plans new ‘Superroad’
Sales dive in West Van & Richmond
Capcom lays off 20
BC deficit understated by $520M
Oakridge plans to be a community

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

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UnagiDon
Guest
UnagiDon

“In Singapore, Vitriol Against Chinese Newcomers”
http://www.nytimes.com/2012/07/27/world/asia/in-singapore-vitriol-against-newcomers-from-mainland-china.html

“These days, mainland Chinese get blamed for driving up real-estate prices, stealing the best jobs and clogging the roads with flashy European sports cars.”

ScubaSteve
Member
ScubaSteve

Banks are at it again. Offering 5 year fixed rates at 2.94%, then releasing press statements claiming “RECORD LOW RATES”, trying to create panic buys from idiots who want to get that extra 0.04% from the last 2.98% mortgages. And it will sadly work for some really stupid people.

Crikey
Guest
Crikey

@ScubaSteve:
“it will sadly work for some really stupid people.”

Such people will hardly have stepped into the front door of their new home before it is worth less than what they owe on it.

No Noise
Guest
No Noise

I just bought a place in the US 25 yr mortgage 3.5% and wanted to do the same in Van West but its 8.75% RBC for a 25 yr mortgage and can’t do it (nor should I). But why?!

patriotz
Member

@No Noise:
You should be asking why you can get such a low rate for 25 years in the US and the answer is (as already pointed out) that Fannie/Freddie, which now have USG loan guarantees, are buying long mortgages to keep the rates down. In Canada long rates are set by the market.

This of course is another reason why RE should be cheaper in Canada than in the US – the mortgage borrower is facing more risk in the long term. But Americans have been cured of the “RE always goes up” illness and Canadians haven’t.

registered
Member
registered

2 ScubaSteve Says: “Banks are at it again.”

I think it’s great as long as banks are 100% on the hook for the loan risk. It’s the way free markets should work.

Anonymous
Guest
Anonymous

@No Noise: “I just bought a place in the US 25 yr mortgage 3.5% and wanted to do the same in Van West but its 8.75% RBC for a 25 yr mortgage”

I would worry less about the interest rate than the capital loss about to occur to Van West. Who cares if you lock in a good rate for 25 years when the price drops in half.

patriotz
Member
Dragon’s Den star reveals why he’s still bullish on real estate Hard to tell whether Croxon is really that thick about RE or it it’s just the reporter. About 1/3 of the article talks about his investments in Whistler, without mentioning that it has experienced the biggest bust of any market in Canada. “I’ve been in and out of three properties in Whistler since 2001 and that market has been very good to me, because I’m very bullish, in real estate in general, and more specifically on the resort real estate market,” he says. Why did he sell if he’s bullish? The market certainly wasn’t good to those who didn’t sell soon enough. From Canadian Real Estate Wealth Magazine, a monthly publication focused on building value through property investment, covering topics such as values and trends, mortgages, investment strategies, surveys… Read more »
Bo Xilai
Guest
Bo Xilai
Anonymous
Guest
Anonymous

@Anonymous: “I would worry less about the interest rate than the capital loss about to occur to Van West. Who cares if you lock in a good rate for 25 years when the price drops in half.”

If he is looking to lock into a 25 year term at a low rate, he probably doesn’t care about the short or medium term price outlook. An overpriced house, but financed at a very low rate, guaranteed for 25 years, just might make sense for some people.

glOO
Guest
glOO

@Bo Xilai:

I work several mainlad chinese. They are average people with average incomes. I like them better than the ones from HK.

Not all of them are millionares and corrupt. Also, there is a lot of bias agaisnt them from non-mainland chinese people. Even if they arent rich.

We’ll see whos been swiming naked soon enough and then there will be plenty of blame to give.

jesse
Member

@No Noise: IIRC any loan in Canada longer than 5 years can be repaid in full after 5 years so there is inherent repayment risk for any loan longer than that.

The large spread for the 25 year loan shows the inherent risks of real estate that, if not covered, would kick out interest rates. That stated, commercial mortgages aren’t significantly higher than residential ones so there’s probably more to it than that. Anybody know?

Best place on meth
Member
Active Member
Best place on meth

@Bo Xilai:

Maybe the mainland Chinese aren’t liked in Singapore (or Hong Hong) because they’re obnoxious pricks.

“Wang Quancheng, the chairman of the Hua Yuan Association, the largest organization representing mainlanders, said the government was not doing enough to help integrate new arrivals, but he also blamed Singaporeans for their intolerance and said many were simply jealous that so many Chinese immigrate here with money in their pockets.”

“Singaporeans staged a rare public protest against new immigrants last summer after a family from China complained about the curry-laden odors wafting from an ethnic Indian neighbor’s apartment.”

Anonymous
Guest
Anonymous

I saw the trend slow down on inventory weeks before and mentioned it, people voted my comments down to foreclosure. I’m hoping for a correction too, but I try to stay as objective as possible. Not all news is going to be what you want it to be. If you choose to ignore it, you’ll always have half the picture.

Anonymous
Guest
Anonymous

@Anonymous: In the limited area I’m following most closely (certain upper level, North Van neighborhoods) detached inventory is down more than 10% in a couple of weeks, from 187 at the top to 168 today. But I realize that is too small a sample to draw broad conclusions.

Chem guy
Guest
Chem guy

@patriotz: Is there any way to finance a Canadian home in the US?

jesse
Member

@Anonymous: “people voted my comments down to foreclosure”

They probably have you confused with another Anonymous.

An Observer
Guest

I was talking to a couple of parents of kids in my sons swim club – they are both chinese, in their mid 40’s and have lived here for 10-15 years and their kids were born here.

The entire hour they were playfully bashing the new chinese people coming over, making jokes about them trying to sneak in the side door and swim for free (avoiding the $4 fee) while they spend $20 in gas driving their Mercedes over from Point Grey etc etc. They were joking around but their animosity was obvious. I just listened not quite sure what to make of the whole thing.

Bo Xilai
Guest
Bo Xilai

@An Observer: I have a couple of good friends from Taiwan and they say the same thing… Lots of underlying animosity.

yvr2zrh
Member

On inventory – – don’t worry about the decrease right now.

Using my historical seasonal models, our inventory will stay flat to decrease slightly through the end of August. September and October will bring 1,000’s of new listings back to the market one more time. Throwing that into a quiet sales period will spike the inventory and we could see 20,000. This will likely push MOI over 10. We will be over 10 MOI on detached now anyway. Don’t be alarmed by the decrease in inventory, it is typical for the season and we should be paying more attention to the fact that sales are slowing and are trending still below 2008.

Navin R. Johnson
Guest
Navin R. Johnson

@Anonymous:

#14

A totally reasonable call considering Re listings always slow into the summer. This is the precursor to a beautiful run up of fall listings, which will surely drive prices south. Things are shaping up perfectly for the bear folk.

kansai92
Guest
kansai92

Immigration wise the batch of new comers now are more or less well to do.
They’ve made their money, usually on the backs of their fellow countrymen, and wanna get some of it out of the country.

In contrast to the ones who came over in the 70s or 80s.
Like my family, we were dirt poor and all 5 of use lived in a 1 bedroom apartment in Chinatown.

kansai92
Guest
kansai92
Continuing the topic of rents from the previous days post… We been here for almost 4 years now without a rent increase. In fact we had one rent decrease in 2009 and from checking rental listings, I believe we are paying 10% less than market value (which is already low compared to other “world-class” cities). I don’t know why people have so many issues with renting. The key is not to rent with amateur flippers. Go with a proper management company. Get a long term lease signed or go month-to-month. And for gods sake, rent the appropriate type of accomodation. If you have a family, rent a townhouse. If you don’t want noisy neighbors, try the west end. What I used to do in the past is walk my dog around late a night and look at the condos around… Read more »
Patiently Waiting
Member
Patiently Waiting
Found this quote from a realtor in a post by a someone associated with Scam Good: “As you are no doubt aware there has been a huge slowing in the market and predictions are that there will be a correction of approximately 25% on detached properties and up to 30% on condos. The other prediction is that we will not see any sort of recovery for another 2 years. How much of the above is true only time will tell. One thing I do know is that The Federal government has not helped by a) cancelling nearly 300,000 investor applicants who were already 2 years into their application process and b) Making it much harder to get a mortgage without proof of income and increasing the ratio of income to borrowing. This has directly affected the numbers of people looking… Read more »
patriotz
Member

@Best place on meth:
“Singaporeans staged a rare public protest against new immigrants last summer after a family from China complained about the curry-laden odors wafting from an ethnic Indian neighbor’s apartment.”

Singapore has government-enforced integration. Every apartment building has a quota for Chinese, Malays, and Indians.

Seems the new arrivals feel that they are above this. Hospices here, curry there.

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