The pros and cons of a fixer-upper
Looking for a bargain?
Why not buy a disgusting heap of a house that no one else wants and turn it into your dream home?
The Financial Post has an article about the pros and cons of buying a fixer-upper.
It’s a first-time homebuyer’s dream: Snag a rundown house in a terrific neighborhood, and then revamp it to your heart’s content.
But fair warning, that fixer-upper could become your worst nightmare.
“You have to really know what you’re getting into,” says Zillow.com real estate expert Brendon DeSimone. “It could be the case where it seems like a good price and then you dig deeper and find that the windows are off, the electrical foundation is messy, and so on.”
Translation: You could wind up spending more than you bargained for.
Read the full article here.
September 5th, 2012 at 1:09 am 1
Why not wait a couple of years and pay 30% less for that fixer-upper?
Seems like a prudent strategy. Not to mention contractors would likely be more willing to provide you with a little extra bang for your buck at that stage of the market.
Or with the money you save, you could buy that house off the poor saps who bought at the top and then proceeded to bankrupt themselves to install granite countertops and track lighting, all to just keep it near their cost price (unlikely). Maybe if you are generous, you can even allow the sellers to say that they “broke even” on their venture (not including the ‘upgrades’ of course).
Bottom line, still far too early to consider buying.
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September 5th, 2012 at 3:04 am 2
Vancouver prices will be down 52.2% by November, 2017.
Yes. 52.2%. Not 52.3% or 52.1%.
I can be just as accurate as the BCREA.
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September 5th, 2012 at 3:06 am 3
Missing the forest for the trees. The article doesn’t even touch on the issue of whether the broad market is fairly valued. Almost all of the price swings in SFH are due to land value, which means you are not going to get a “deal” regardless of the condition of the building.
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September 5th, 2012 at 3:07 am 4
@ScubaSteve:
Wake up to take your Psychotic medicine now
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September 5th, 2012 at 7:48 am 5
Sorry but I find this article very misleading and dangerous..
When the fixer upper is 1.NN Millions, and you bought it, there is something else that needs fixing first – your head.
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September 5th, 2012 at 9:15 am 6
I just rented a very nice house for $1850.00 ( I guessed my landlord paid more than $700,000 for it).
The owner (the wife) seems to be ok. But the husband seems to be so rude when I met him (guessing he was so mad at his wife for purchasing the house).
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September 5th, 2012 at 9:25 am 7
I think The Chronicles of Froogle Scott at VREAA and Mike Holmes show on HGTV should dissaude most average people from either attempting a fixer-upper themselves or buy one (before or after the fix) because there are just too many unknowns, potential problems, and cost overrun.
The quality of fixer uppers that are done for flips in my area has been steadily getting worse and worse since 2001. Seems like the higher the profit potential, the less incentive there is to take pride in one’s work.
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September 5th, 2012 at 9:35 am 8
Guys! I heard the housing market is going to crash tomorrow! All those evil people who bought property and made tons and tons of money will finally be punished!
We will finally be able to buy a place of our own!
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September 5th, 2012 at 9:53 am 9
Guys! I heard the market is going to pop tomorrow! All those worthless bears who cried about the sky falling will never be able to buy in!
They’ll be paying other peoples mortgages forever!
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September 5th, 2012 at 9:56 am 10
That there are still people who think it’s still plausible to turn a profit on a fixer upper is incredible in itself.
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September 5th, 2012 at 10:02 am 11
“Property Always a Good Investment” Says President of National Association of Realtors in India
http://globaleconomicanalysis.blogspot.ca/2012/09/property-always-good-investment-says.html
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September 5th, 2012 at 10:41 am 12
Anonymous – Market already popped yesterday. I hear Realtors phones are ringing off the hooks. It’s the fall market baby. And either fall into a new mortgage or keep renting.
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September 5th, 2012 at 10:43 am 13
“I just rented a very nice house for $1850.00 ( I guessed my landlord paid more than $700,000 for it).”
I smell bullshit! Where in Vancouver can you get a house for $700,000?
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September 5th, 2012 at 10:59 am 14
@Van: Right here: http://www.realtor.ca/propertyDetails.aspx?propertyId=12180494&PidKey=-1595509818
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September 5th, 2012 at 11:04 am 15
More international hand-wringing about Canada.
“Société Générale believes Canada still doesn’t have a handle on a frothy real estate market.
Senior foreign exchange strategist Sébastien Galy today cited the risks associated with a protracted period of low interest rates.”
http://www.theglobeandmail.com/report-on-business/top-business-stories/top-business-stories-housing-bubble-is-not-yet-under-control-socgen-warns-canada/article4519999/
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September 5th, 2012 at 11:16 am 16
Aug REBGV report: http://www.rebgv.org/news-statistics/home-sellers-continue-outnumber-buyers-greater-vancouver%E2%80%99s-summer-housing-market
The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales of detached, attached and apartment properties reached 1,649 in August, a 30.7 per cent decline compared to the 2,378 sales in August 2011 and a 21.4 per cent decline compared to the 2,098 sales in July 2012.
August sales were the second lowest total for the month in the region since 1998 and 39.2 per cent below the 10-year August sales average of 2,711.
“Home sales this summer have been lower than we’ve seen for most of the past ten years, yet we continue to see relative stability when it comes to prices,” Eugen Klein, REBGV president said.
New listings for detached, attached and apartment properties in Greater Vancouver totalled 4,044 in August. This represents a 13.7 per cent decline compared to August 2011 when 4,685 properties were listed for sale on the MLS® and a 15.8 per cent decline compared to the 4,802 new listings in July 2012.
“For sellers it’s critical to work with your REALTOR® to understand today’s market and to develop the best strategy for selling your home,” Klein said. “On average it’s taking about two months for a home to sell on the MLS® in Greater Vancouver today.”
At 17,567, the total number of residential property listings on the MLS® increased 13.8 per cent from this time last year and declined 2.8 per cent compared to July 2012.
“Today, our sales-to-active-listings ratio sits at 9 per cent, which puts us in a buyer’s market. This ratio has been declining in our market since March when it was 19 per cent,” Klein said.
The MLSLink® Housing Price Index (HPI) composite benchmark price for all residential properties in Greater Vancouver is $609,500. This represents a decline of 0.5% compared to this time last year and a decline of 1.1% compared to last month.
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September 5th, 2012 at 11:17 am 17
This twin-building complex near Lougheed mall is a financial disaster. Below unit goes from $449k to $439k to now $407k listing. Unit is vacant per description, so apparently a naive investor who’s tired of renting at a negative cash flow is bailing.
http://webcache.googleusercontent.com/search?q=cache:sOtzk08Ta88J:www.6717000.com/mls/V956163-310-9868-cameron-st.html+&cd=1&hl=en&ct=clnk&gl=ca
http://webcache.googleusercontent.com/search?q=cache:5tg_7kpfEc4J:www.ecorealtyinc.ca/listing%3Fid%3D259550631+&cd=2&hl=en&ct=clnk&gl=ca
http://mlslink.mlxchange.com/DotNet/Pub/EmailView.aspx?r=713205761&s=BRC&t=BRC
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September 5th, 2012 at 11:17 am 18
What neighborhood is this? Oh, right – it’s not in the GVRD.
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September 5th, 2012 at 11:17 am 19
@Van:
I never said I rented the house in Vancouver city. But it is in Great Vancouver
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September 5th, 2012 at 11:28 am 20
@VMD: Most shocking (for me) statistic in that release is in the footnote – there are 11,000 realtors in Vancouver/REBGV?! Wow.
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September 5th, 2012 at 11:29 am 21
aug rebgv stats pkg
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September 5th, 2012 at 11:32 am 22
2001-2012 rebgv stats package archive
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September 5th, 2012 at 11:32 am 23
My internet sleuthing indicates The Key is not dead yet. Scam is trying to hire a team of realwhores to do something. Not sure what it is.
My main concern is whether he’s going to try to incite racial hatred again. I’ll be watching, you hear me Scam?
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September 5th, 2012 at 11:34 am 24
@VMD: ““Home sales this summer have been lower than we’ve seen for most of the past ten years, yet we continue to see relative stability when it comes to prices,” Eugen Klein, REBGV president said”
Prices dropped 1.1% from last month. This annualizes to 13%. That’s supposed to be stable?
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September 5th, 2012 at 11:44 am 25
@Patiently Waiting:
http://www.thekey.com/hostpage/careers.html ?
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September 5th, 2012 at 11:49 am 26
@gokou3: Yep, they’re also promoting it on their social media. So far, Scam himself isn’t saying anything publicly. Maybe they realize he’s tainted and will keep him out of the media. One can only hope.
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September 5th, 2012 at 11:49 am 27
re: stats
for all those people that believe in the misconception that expensive areas are not going to fail:
The winner is Vancouver west side, with index drop of -2.5% for one month and -5.9% for 3 months.
This bodes well with my thinking that:
- van west had a lot of speculation in the SFH.
- new rules are going to hit hardest the houses worth above 1M
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September 5th, 2012 at 12:02 pm 28
@asalvari1:
funny, I did not looked the apartments numbers for long time. It appears that most of the prices are within the 10% of the 2009 bottom. The winner (again)is Burnaby east, at -11% 3years ago and -13.7% 5 years ago. I believe that this would put it BELOW 2009 lows.
then it hit me – It IS happening, now, just while we have this stupid tug-of-war bull/bear on daily basis.
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September 5th, 2012 at 12:05 pm 29
you know when you’re in a bubble when meetup.com shows that Vancouver has over 20 groups on real estate “investing” and only 4 for all other asset classes combined.
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September 5th, 2012 at 12:09 pm 30
@/dev/null: So take the “over” 11,000 used house salespeople combined with the $25B in transactions in 2011, assume a 30% decline in transactions for 2012 and assume a generous average commission of 4%…and you get average income of $64K in 2012. Now of course we know that there are a good number of high end salespeople working the “Wests” so pull a Rennie and take out the top 20% and your average is probably somewhere around $50K. Now take out the costs (brokerage fees, advertising, BMW lease etc.) and your average profit is what? Lets say at least sub $40K, and this is just on reduced volume, nothing about price drops!
I don’t have the time to do a detailed analysis but it would be interesting to see how price declines combined with reduced volume actually affect the bottom line for this career choice and I think it will be glaring that a whole bunch of salespeople are going to be trying to re-enter the workforce.
BTW, I’m in a senior sales and marketing role and any resume I get that has “Realtor” written on it is going straight to the shredder.
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September 5th, 2012 at 12:21 pm 31
Here is 2012 September graph that compares the Vancouver decline with one US market – San Diego:
http://vancouverpeak.com/groups/data-hounds/forum/topic/crash-curve-graphs/?#post-2572
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September 5th, 2012 at 12:35 pm 32
MLS® Home Price Index July 2012 Aug 2012 Chg(%) Annualized(%) Detached 950,200 942,100 0.86 10.32 Attached 468,700 462,300 1.38 16.61 Apartment 374,300 370,100 1.13 13.61Like or Dislike:
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September 5th, 2012 at 12:42 pm 33
also: membership in the avg real estate groups is about 3x that of non-RE investing groups.
Checkout this group for a good laugh:
Name: “Cashflow Game Night for Real Estate Investors”
Trolls, wouldn’t you rather be playing board games with other trolls instead of coming here to moan?
Pitch: “We firmly believe that our lives should be under our own control. We don’t want to rely on an employer for whom we trade our valuable time in order to earn just enough money to pay our bills. We don’t want to have a bad day just because our boss is having a bad day. We want to go to work because we choose to, not because we have to.”
You mean I won’t need to do real work anymore? tell me more!
We know that Real Estate Investing gives us the power to take back control of our lives, to help replace our income, …”
Hate to tell you but…prices are so inflated that part of your job income has been subsidizing renters. And being a debt slave through a long deleveraging process won’t exactly help you take control of your life.
We believe that there is no better, safer, or more viable vehicle to achieve this. I mean, 90% of the worlds wealthy got there through real estate. If it worked for them…
Amen. It totally worked for people in the US, Europe, Japan.
We’ve created this meetup group to help you quell the confusion, to shorten your time lines by learning from our mistakes, and to provide support through this amazing journey.
The really amazing part is just beginning.
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September 5th, 2012 at 12:42 pm 34
Is this fucking mentality and behavior that we are supposed to get accustom to due to changing times and multiculturalism so we don’t get called racist when pointing out HAM savagery?
http://www.dailymail.co.uk/news/article-2198246/Ling-Gu-death-Ferrari-crash-covered-Chinese-officials.html?ito=feeds-newsxml
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September 5th, 2012 at 12:45 pm 35
@asalvari1: “then it hit me – It IS happening, now, just while we have this stupid tug-of-war bull/bear on daily basis”
If buy tug-of-war, you mean bulls posting stupid comments and bears laughing at them….then yeah, I suppose it’s a tug-of-war
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September 5th, 2012 at 12:48 pm 36
REBGV stats are up here: http://www.paulboenisch.com/REBGVStats.ubr
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September 5th, 2012 at 12:49 pm 37
words are out on MSM:
[Vancouver home sales plunge, posting second-worst August since 1998]
Garry Marr | Sep 5, 2012 2:38 PM ET
“Sales activity in the country’s most expensive housing market continues to tumble but the Real Estate Board of Greater Vancouver maintains prices are not being impacted.
… Home sales this summer have been lower than we’ve seen for most of the past 10 years”
http://business.financialpost.com/2012/09/05/vancouver-home-sales-plunge-posting-second-worst-august-since-1998/
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September 5th, 2012 at 12:50 pm 38
@YLTNboomerang: It’s going to be ridiculous how many bankrupt Uses Houses Salespeople there will soon be. People most likely to rack up debt are people that are currently earning less than expected ‘today’, but expect things will turn around for them ‘tomorrow’…and we all know tomorrow ain’t going to come for them.
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September 5th, 2012 at 1:04 pm 39
@crashcow: “you know when you’re in a bubble when meetup.com shows that Vancouver has over 20 groups on real estate “investing” and only 4 for all other asset classes combined.”
And at least one of the meetup groups is dismantling because the organizer bailed.
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September 5th, 2012 at 1:24 pm 40
Posted on the Vancouver Bubble thread at http://forums.redflagdeals.com/vancouver-bubble-road-50-housing-crash-w-monthly-stats-1194032/114/#post15316960
————————-
REBGV released the August stats today. Nothing positive in their press released at all, titled “Home sellers continue to outnumber buys in Great Vancouver’s summer housing market”. The REBGV reported that “August sales were the second lowest total for the month in the region since 1998 and 39.2 per cent below the 10-year August sales of 2,711″. And as predicted, for the first time the HPI composite benchmark fell 1.1% in 1 month and is down 0.5% YoY.
According to the “HPI” prices from the real estate board, they claim that many of these cities are now down in price YoY. This was the last stronghold, and even HPI has now fallen. Some of the hardest hit areas for PRICES in the stats release:
DETACHED
-3.7% = Richmond
-3.7% = Vancouver West
-1.3% = Maple Ridge
CONDOS
-8.0% = Burnaby South
-7.9% = Port Coquitlam
-6.4% = Burnaby East
TOWNHOUSE
-8.8% = Tsawwassen
-8.3% = Burnaby North
-4.5% = Maple Ridge
And here are some the 5 hardest hit areas for SALES in the stats release.
1) West Vancouver (-65.6%)
Aug/12 = 34 sales
Aug/11 = 96 sales
2) Burnaby (-47.5%)
Aug/12 = 174 sales
Aug/11 = 331 sales
3) Coquitlam (-41.6%)
Aug/12 = 122 sales
Aug/11 = 209 sales
4) Richmond (-31.2%)
Aug/12 = 179 sales
Aug/11 = 260 sales
5) Vancouver West (-31.0%)
Aug/12 = 362 sales
Aug/11 = 524 sales
6) Vancouver East (-29.6%)
Aug/12 = 169 sales
Aug/11 = 240 sales
7) North Vancouver (-29.0%)
Aug/12 = 113 sales
Aug/11 = 159 sales
Conclusion
Not sure it needs to be said, but this was a dismal month. With the second lowest sales since 1998 for an August month, there was nothing to be pleased about. But if that wasn’t enough, the “HPI” flood gates have been overcome and we are now seeing prices drop everywhere. No longer just average prices dropping, but as can be seen above, even the heavily resistant HPI prices are plunging. Certain areas are getting hit much harder than others. For instance, Condos in Burnaby South are down 8% in price YoY, while condos in Port Moody are up 7.1% YoY. The HPI is a very conservative number in my opinion and does not represent actual price drops. It is truly the “bare minimum” and often lagging behind. So anyone who has purchased a condo in Burnaby or Port Coquitlam, for instance, will have had their condo drop significantly in price from last year.
And I’ll end with a final observation. Isn’t it funny… isn’t it just hilarious… that at the beginning of the year, the BC Real Estate Association forecast that prices would go down 2% this year. And now, just a couple of days before the release of these stats, they revised their forecast down to 8% this year (still conservative). How convenient. Sucks for homeowners who bought in the market, figuring “Oh well, prices will only go down 2 per cent at worst”. For home buyers who have saved up a 5% down payment to buy a house, it is now gone in many cases, in the blink of an eye. Homeowners who purchased a condo in Burnaby with even 20% down are likely to have difficulty breaking even now after realtor costs and other related fees.
But hey, don’t worry… “It’s different here”. No US-style crash here. This will be a Canadian-style Crash.
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September 5th, 2012 at 1:27 pm 41
FFWD a few years and the Vancouver fixer-upper is not going to be a detached home, it is going to be buying two uselessly sized apartments and joining them up. Check out the layout and photo’s of this one:
http://vancouver.en.craigslist.ca/van/apa/3251861399.html
Forget the fact that this person is dreaming at $2100/month asking rent but look at the second bedroom that can barely fit a futon not to mention that the “flex” room is so small that they don’t even have a picture. I think the icing on the cake though is the fact that the kitchen looks like an afterthought slapped onto a wall of the mini living room (no dining area of course). I am guessing that the 800sqft measurement includes the patio.
The city is full of these hopelessly small units as developers try to attract the FTB however the city want’s families to live in town…the only family that can live in these shoeboxes are hobbits!
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September 5th, 2012 at 1:27 pm 42
@Chabar:
uh, well. Give them a bit more time, like few years or so. They will disintegrate internally, the conflicts in that society are too big to sustain itself in current form for long.
In some way, I have “Been there, done that, have the t-shirt”.
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September 5th, 2012 at 2:05 pm 43
I was sure they would have trumpeted the average price this month since it went up.
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September 5th, 2012 at 2:12 pm 44
Not that I like to toot my own horn but I did call it that we would have increase in avg. this month with decrease in HPI . . . . If we did not then this would just be voodoo economics.
Let’s see how Week 1 goes for Sep. Remember that the first couple of weeks is really the late August sales posting while the listings are real time post-labour day decisions.
Just about to go and do the data mining through the report to see how bad certain areas really are.
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September 5th, 2012 at 2:22 pm 45
@YLTNboomerang: $300 move-in and $300 move-out fees? Seriously? Is that normal? The bby apt that i rent charges $100 each way.
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September 5th, 2012 at 2:27 pm 46
@gokou3: That’s absurd, why would there be a fee to move in or out of a condo? I’ve never paid a fee beyond a deposit on a parking garage key or a damage deposit, what the hell would justify a ‘moving’ fee?
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September 5th, 2012 at 2:40 pm 47
How has September done compared to August? Here is the % change in sales from August to September since 1999:
-4% -2% -16% 0% 2% 15% -8% -16% -18% 2% 3% 1% -6% average -3.4% stdev 9.2%
Taking the max, min, average, and 1stdev we can take a stab at where sales will be, given August’s were 1649:
max 1,892
+1stdev 1,801
avg 1,590
-1stdev 1,497
min 1,353
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September 5th, 2012 at 2:41 pm 48
“Vancouver’s Olympic Village ghost town or boom town”
http://www.vancouversun.com/videos/recommended/video.html?embedCode=dwazRzNTrj-EHTuLKpN7hfR4rurk03Ka
That’s who will be hurt by a housing collapse. Not some nameless ‘HAM’, but people who look and act just the way you do.
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September 5th, 2012 at 2:55 pm 49
@gokou3: Yea, $300 is pretty high. Most places I’ve rented used to have a move in/out damage deposit however now that most have moved away from live-in building managers or concierges they have to pay someone to come and put up the elevator protection and inspect pre/post move. I can accept $75 or even $100 for this but $300???
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September 5th, 2012 at 2:56 pm 50
@gokou3: “$300 move-in and $300 move-out fees? Seriously? Is that normal? The bby apt that i rent charges $100 each way.”
I believe many buildings are now starting to charge a move-in fee only, as it’s hard to track down those who choose not to pay the move-out fee.
But $300 each way sounds ridiculous.
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September 5th, 2012 at 2:59 pm 51
@wallnut grove: Well we’re not quite the same. I used my head and realized that I could rent the same unit for around half the price despite record low interest rates (after considering maintenance, fees and taxes).
They drank the kool aid. Or in that case, ate the TD hot dogs.
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September 5th, 2012 at 3:01 pm 52
“Today, our sales-to-active-listings ratio sits at 9% which puts us in a buyer’s market. This ratio has been declining in our market since March when it was 19%,” said Mr. Klein.
Well, at least now we know where the board defines a ‘buyers market’.
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September 5th, 2012 at 3:07 pm 53
Canadian Real Estate sector looks bright: DBRS
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September 5th, 2012 at 3:09 pm 54
The benchmark price for detached properties increased 0.2 per cent from August 2011 to $942,100.
Still going up!!!
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September 5th, 2012 at 3:10 pm 55
@Chabar: not racist, just stupid. And the Chinese definitely don’t have a monopoly on that.
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September 5th, 2012 at 3:41 pm 56
This is the most stupid thing anyone can do
In an up market, which is for sure not now, only the land value of a property goes up over time due to shortage of land in the city. Any renos are considered as expenditure, fixer-upper is not an investment. The money sank in it is gone and will depreciate over time, much like the property value if you check the yearly assessment.
Van’s laneway house is another stupid thing sort of like this. The property value goes up because the next buyer gives this a thumbs up. In a down market like this, you are throwing good money after bad money. It is just a really dumb idea.
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September 5th, 2012 at 3:52 pm 57
Regarding the subject post – Some friends I know were looking for a house, considering a fixer-upper. The thought that went through my mind was, do you make your bed every morning and pick up after yourself? If not, then maybe the fixing up part ain’t going to happen.
Well, in that case, a happy ending. They bought a place that was no show home, but suited them and their large beast. They haven’t yet bothered to fix it up but have lived happily ever after in their ordinary home. “Home” being the operative word rather than investment vehicle. Take a look at yourself and think about the time and effort and money involved in a renovation and triple it. Not saying don’t do it, just beware.
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September 5th, 2012 at 4:04 pm 58
As nice as it is to see a 1.1% drop in prices from last month and year over year prices turning negative, this is still just the beginning of the fun. This bursting market is going to give me endless amounts of joy for years to come.
Looks like another day of 300+ listings and sell/list in the 20′s.
Aloha, suckers.
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September 5th, 2012 at 4:06 pm 59
@camper:
““Home” being the operative word rather than investment vehicle.”
Well I guess that means they won’t mind if prices crash, since it’s just a home rather than an investment.
Let us know if their attitude changes.
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September 5th, 2012 at 4:15 pm 60
@patriotz: “Well I guess that means they won’t mind if prices crash, since it’s just a home rather than an investment.”
Logical fallacy. I’m sure they’ll mind if prices crash, at it prevents an obstacle to moving even if the property isn’t considered an investment in terms of capital appreciation. On contrary, I’m sure they won’t mind if prices stagnate.
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September 5th, 2012 at 4:18 pm 61
@patriotz: I agree in that you should still take a hard look at your home in financial terms and think of the investment angle. In this case they bought out of central Vancouver and a couple of years ago, with a pretty good down payment but even so, fingers crossed. No guarantees.
Could have been a new build condo, no equity, 30 year mortgage etc. I guess my point is that some people don’t need shiney, new, expensive, all on credit or worse a never ending money pit. If prices crash some will gain and some will lose and some will weather what is looking like a really bad storm coming. I think these guys should be OK because they went right down the middle.
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September 5th, 2012 at 4:21 pm 62
@Vote Down The Facts:
“I’m sure they’ll mind if prices crash, at it prevents an obstacle to moving”
Not an obstacle to moving at all. Just to selling.
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September 5th, 2012 at 4:26 pm 63
can’t wait to see the grandparents and single mothers crying on GlobalTV about their negative equity. I suggest we reinstate debt slavery now, so there is a large supply of cheap dumb labour.
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September 5th, 2012 at 4:28 pm 64
@patriotz: “Not an obstacle to moving at all. Just to selling.”
Oh jesus. You know what I meant.
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September 5th, 2012 at 4:31 pm 65
@YLTNboomerang:
I saw plenty of these long narrow apartments when I was looking for a place. Just can’t imagine myself living there. To boot, they invariably had by far the highest asking rents. I don’t even think they were ever trendy in Vancouver, maybe in TO where lofts are much more common, so this pseudo-, a’la loft layout is more accepted.
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September 5th, 2012 at 4:35 pm 66
@good-format: “The owner (the wife) seems to be ok. But the husband seems to be so rude when I met him (guessing he was so mad at his wife for purchasing the house).”
I buy tree, my huzbah pissed that I buy tree.
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September 5th, 2012 at 4:39 pm 67
@/dev/null: “Most shocking (for me) statistic in that release is in the footnote – there are 11,000 realtors in Vancouver/REBGV?! Wow.”
My GOd! With all the competition, it’s going to be really hard to get a job at McDonalds soon.
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September 5th, 2012 at 4:53 pm 68
http://www.doctorhousingbubble.com/canadian-housing-bubble-full-mania-canada-household-debt-surpasses-us-household-debt-canada-real-estate/
Nothing new but always good to see additional coverage of our bubble.
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September 5th, 2012 at 4:55 pm 69
The PROs of a fixer upper is that people forget how much they spent on the renos.
When they go and sell the property some time in the future, they think they’ve made money when they really haven’t.
Oh the beauty of selective memory.
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September 5th, 2012 at 5:00 pm 70
New Capital Direct ad on radio, heard it today. Goes like this “Have you noticed your bank has made it almost impossible to get further funds? It was ok last year, and it seems like this year the taps are turned off.” No shit.
You can hear it on the CKNW audio vault, ex. today 1:00 around 27:55 mark.
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September 5th, 2012 at 5:36 pm 71
@Best place on meth: “3,000 Crooked Miles to Honolulu” A great episode!
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September 5th, 2012 at 6:11 pm 72
New Listings 327
Price Changes 120
Sold Listings 69
TI:18263
http://www.paulboenisch.com – REBGV stats have been posted
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September 5th, 2012 at 6:17 pm 73
@paulb: luvin the 21% sell-list. Luvin even more that we added 161 net new listings. I staked out a claim in August that we would indeed get to 19K this month and 20K in October. I think that is gonna happen. With sales at like 1500, that gives MoI of like 13.3. Yeah.
Note that the 7-day MA for listings is still including the ultra-low end of August listing days. We are more likely to get around 6000 new listings, I think.
What are we at? 16 straight days of <100 sales? oh man….
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September 5th, 2012 at 6:18 pm 74
They were talking about the housing market on ctv news today, and of course who did they interview? ole Cam Muir . I think he got his economics degree in a box of cracker jacks.
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September 5th, 2012 at 6:19 pm 75
To today’s 69 successful realtors: You are each responsible for taking 160 of your colleagues out to dinner. Times are tough, you’ve got to stick together!
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September 5th, 2012 at 6:21 pm 76
Oh, and for the ‘sales will pick up soon’ crowd, the evidence from 2010 and 2011 says ‘no’. Sales are pretty constant throughout September.
Here is 2010:
and 2011
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September 5th, 2012 at 6:21 pm 77
Story coming up on CTV about old condos forced to retrofit elevators.
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September 5th, 2012 at 6:30 pm 78
@VHB: MOI is going parabolic! (in RE time)
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September 5th, 2012 at 6:54 pm 79
@VHB: is it true you bought a place?
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September 5th, 2012 at 6:57 pm 80
As mentioned earlier by midnite_toker, the lead item on CTV Vancouver news tonight is the slumping Vancouver real estate market – August sales figures down 30.7% YOY. They also had some clown named Andreas whining that if he can’t flog his crap-shack for $2 million, then (horrors!) he’s going to have to GET A JOB AND GO TO WORK!!! Oh, the HUMANITY!!
Yeah, Andreas…..people elsewhere have to actually work to make money, cuz their dwelling-place doesn’t actually generate income so they can retire at 50…..
Whiner.
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September 5th, 2012 at 7:02 pm 81
@Anonymous: He is a liar and a dweller in Balmoral Hotel.
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September 5th, 2012 at 7:05 pm 82
CTV News: “Experts are beginning to wonder if Vancouver’s real estate bubble is going to burst.”
Just beginning?! How long has this site been around for?!
Cam Muir: “Vancouver’s real estate market survived the 2008 global financial crisis and if that wasn’t a threat to asset bubbles, I don’t know what is?!”
Isn’t the threat to the bubble inherent in the bubble itself?! The fact that we have a bubble means it is unsustainable based on economic fundamentals like incomes and rents. I’m paraphrasing that quote but Cam Muir did use the term “asset bubble” to describe Vancouver’s real estate market. By calling it a “bubble” isn’t he admitting it’s unsustainable and must come down? We don’t need a global financial crisis to bring down Vancouver’s real estate bubble. Low interest rates kept the bubble going after the financial crisis of 2008 but they can’t lower rates much more and the talk is all about the need to raise interest rates.
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September 5th, 2012 at 7:09 pm 83
@kabloona: Oh yeah, I saw that guy on CTV news too. Crying that he’s going to have to get a job soon if he can’t flip his crack shack for 2 million. He didn’t look old enough to be retired to me. I said out loud to the TV, “Good, you should get a job.” Why would anyone feel entitled not to work for a living? Why would anyone go on the news and expect sympathy that they might have to get a job to earn an income?
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September 5th, 2012 at 7:11 pm 84
Curious… What was the month start and end month inventories for Sept ’10 and ’11? Curious to see if we have a shot at net +1,700 listings between now and month end. If anyone can help, it would be appreciated.
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September 5th, 2012 at 7:16 pm 85
@Vote Down The Facts: Dude, there is no way prices will ‘stagnate’. That’s the first sign of a capitulating bull….
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September 5th, 2012 at 7:16 pm 86
@Joe_Blown_Away_By_High_Housing_Costs: I look forward to a future story where he has to rent out all the bedrooms in his shack to foreign backpackers who treat him like a servant. I see him wearing an apron, cooking meals, cleaning rooms etc. LOL
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September 5th, 2012 at 7:33 pm 87
@Anonymous:
I wasn’t saying prices would stagnate, just pointing out that somebody can not be a speculator yet still care if prices crash.
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September 5th, 2012 at 7:49 pm 88
@Joe_Blown_Away_By_High_Housing_Costs: ”
“CTV News: “Experts are beginning to wonder if Vancouver’s real estate bubble is going to burst.”
Just beginning?! How long has this site been around for?!”
But you guys are not experts. You are just a broken clock whose time may finally have come (maybe). Keep in mind, you’ve been seeing a crash just around the corner for the last six years.
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September 5th, 2012 at 7:59 pm 89
@Joe_Blown_Away_By_High_Housing_Costs:
Because we live in a world where people have increasingly lost the distinction between ‘making money’ and ‘producing wealth’. Most people out there would be perplexed by the notion that there is even a difference at all. There is no less admiration for someone who becomes a millionaire by picking the right stocks than someone who gets rich building a real business or producing a tangible service that creates real wealth.
In fact, given the choice, the overwhelming majority of people would rather get rich without working at all, which is a big part of why we currently have the most morbidly obese housing bubble in history.
Sadly, I don’t think people will wake up to the distinction even after the bubble bursts. Since so many people will be negatively affected (70% of home owning Canadians), expect to see a whole lot of resentment and bitterness at all the ‘lost wealth’ rather than a realization that it was never there in the first place.
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September 5th, 2012 at 7:59 pm 90
Anon, you cocksucker (watch our McLovin, you have may have some competition!), this crash will be so epic all of us bears will have statues made of ourselves that are put on public display.
We had the guts to withstand enormous societal/peer/spouse/family pressure to look a bubble in the eye and say Fuck You.
And that’s what we say to YOU.
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September 5th, 2012 at 8:04 pm 91
Today on Garth’s blog Canadian Watchdog says the Vancouver HPI is getting revised. Lower of course. This makes the HPI decreases seem smaller than they should be. Anyone keeping track of this historical data and comparing to what’s displayed today at all? These kinds of data (indexes, surveys) are always getting quietly revised, usually lower, like employment numbers for example.
Some of it is fair enough, such as actual data arrives months later and estimates are replaced with it. But how does that square with the HPI? Sales close a few weeks later than the sale takes place, sure, but we’re talking several % points. Doesn’t seem likely the later closing sales would drag the index so low.
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September 5th, 2012 at 8:13 pm 92
Devore,
I read that as well, would love to hear detail/confirmation – perhaps this can be exposed…but I doubt it, they are not interested in the truth….at all….cartel….
I have a feeling that this could be an epic shakeout, one that we tell our grandchildren about (when we are trying to dissuade them from buying into a bubble…of course they will dismiss us and tell us it’s different now, etc…oh what fun we’ll have)….in a year us bears could look like geniuses, as the first 30% comes off this market….
I don’t think it’s out of the question that a decent lot/Westside teardown goes down to 6-700k….or lower…
McLovin, stash that cash, at $20 a pop that downpayment should be adding up nicely!:-0
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September 5th, 2012 at 8:33 pm 93
HEre is the link Canadian watchdog posted with Ben Rabidoux.
http://t.co/yL2yRFgx
Can someone help me see what the issue is? The new HPI was not supposed to sit on top of the old HPI. It was a rebasing with a new model. It shouldn’t be on top of the old one. But maybe I’m missing what’s wrong. Help?
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September 5th, 2012 at 8:53 pm 94
For anyone who didn’t get to see Cameron the Smirker or Andreas the Whiner, please enjoy.
http://bc.ctvnews.ca/vancouver-residential-real-estate-drops-1.943679
I would like to be the first in line to order a latte from Andreas when he starts his new job.
And Cameron, what the fuck does if that (global financial crisis) wasn’t the tipping point or a trigger for a deflation of an asset bubble, I don’t know what is supposed to mean you asshole?
Now you’re just speaking in tongues.
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September 5th, 2012 at 8:54 pm 95
Hey guys listen…..”gargle gargle… Vancouver….. Gargle, gargle..it’s diff…gargle… erent… gargle gargle…. hereeeee gargle gargle”
That’s Cam Muir and the like still blabbering as the ship goes down…
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September 5th, 2012 at 8:55 pm 96
@VHB:
VHB the concern is the rebasing… why would they continually rebase something? We don’t know what the “old model” would have looked like, just the new model. What if they remodeled HPI in order to have it do better during a crash?
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September 5th, 2012 at 8:58 pm 97
I see RJ’s mom went out to Bingo at the Legion and he’s found the hidden power cord…
As excited as we all are with these truly bearish numbers I think it will be a slow grind down. A multi year event. We all need to just be patient and enjoy the show because there is no stopping this party now!
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September 5th, 2012 at 8:59 pm 98
@Chabar: @Chabar:
Its not racist to point out incidents, but trying to associate the actions of individuals across an entire group of people is. This is exactly what you are doing.
It’s like if I linked an article about honor killings or burning women alive with their dead husbands from India or the Middle East and then said the same thing you said.
“Is this fucking mentality and behavior that we are supposed to get accustom to due to changing times and multiculturalism so we don’t get called racist when pointing out Indian/ Middle Eastern savagery?”
Judging by your name that might hit a little closed to home. Regardless, I wouldn’t judge an entire group of people or have preconceptions just because of a few things I’ve heard or read. I know many people that could be considered HAM and they have polite and hard working kids. Money and power tend to corrupt, and you can find examples of this in any culture. And for the record one of my best friends is Indian, and I’m sure he won’t be doing any honor killing just as most Indian and Middle Easterners wouldn’t.
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September 5th, 2012 at 9:05 pm 99
Muir is such a complete dooooosh! That news clip is fantastic though!
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September 5th, 2012 at 9:22 pm 100
@Best place on meth: Prof. Andrey Pavlov, congratulations on being the only local RE commentator with any credibility!
“The time on the market has tripled since two months ago. So that’s a crash by any measure.”
Also, is it just me, or does Cameron Muir’s new mustache make him look like Lawrence from Office Space?
http://cdn.memegenerator.net/instances/250×250/22990502.jpg
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September 5th, 2012 at 9:29 pm 101
@Best place on meth:
Andreas is the perfect Vancouver boomer-douche.
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September 5th, 2012 at 9:34 pm 102
@VHB: “But maybe I’m missing what’s wrong.”
Do you see? Do you see?
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September 5th, 2012 at 9:35 pm 103
@Romeo Jordan: #90,
your box must be losing value, or your girlfriend is prenant. thus the stupid mind of yours is explored.
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September 5th, 2012 at 9:43 pm 104
Colliers report here.
Look guys, these blogs are having an impact. Read the commentary in the report. Don’t sell yourselves short.
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September 5th, 2012 at 9:44 pm 105
@Chabar:
To any of those that didn’t read the article Chabar refers to, in a nutshell the story is:
Son of high-ranking Chinese communist party official killed while driving his $700,000US Ferrari; two nude “minority” women in the car with him survived but sustained injuries.
Yup, I’m amazed at any communist party where officials’ children have that much money to throw around ontoys… Where is the outrage and protests? I suppose the fact that they blocked the term “Ferrari” from their internet searched for a period of time helped (no joke), but the govt is finally admitting to the story.
No, this is not something unique to China. Greed is no doubt a problem that knows no cultural or racial boundaries. But this very interesting nonetheless…I’m grabbing my popcorn.
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September 5th, 2012 at 9:54 pm 106
@ZRH2YVR:
Looking at Aug/12 Van West SFH Average vs Median price graph,
Avg price skyrocketed while Median price dropped (so did HPI).
Definitely showing the effect of extreme outliers!
http://s17.postimage.org/fer8a74fz/VWaug.jpg
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September 5th, 2012 at 10:20 pm 107
@Romeo Jordan: Which Anon are you talking to? Please let it be me! It really makes my day to piss you guys off to the point where you start using naughty words.
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September 5th, 2012 at 10:21 pm 108
Realtors are too busy doing deals and showing properties to get their sales reports into the office. No report, no sale reported. I think they will catch up in the next couple days or weeks.
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September 5th, 2012 at 10:29 pm 109
@Van: Right Van. Click your heels together and you’ll be in Kansas again. Give my regards to the Wizzard
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September 5th, 2012 at 10:33 pm 110
@jesse: what impact? from a bunch of whinners?
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September 5th, 2012 at 10:34 pm 111
Van says
“Realtors are too busy doing deals and showing properties to get their sales reports into the office. No report, no sale reported. I think they will catch up in the next couple days or weeks.”
or years… you mean
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September 5th, 2012 at 10:37 pm 112
@Rakim: Andreas seems like a perfectly nice guy to me; just having a hard time adjusting his expectations.
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September 5th, 2012 at 10:40 pm 113
@Van: More than a thousand realtors and less than a hundred sales, yet they are falling behind? Are you saying that Realtors are that slow? Is brain damage a prerequisite in your line of work?
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September 5th, 2012 at 10:45 pm 114
@anon 110 – @jesse: what impact? from a bunch of whinners?
I think you misspelt winners
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September 5th, 2012 at 11:13 pm 115
@Rakim:
This appears to be the listing from the story: http://www.ecorealtyinc.ca/listing?id=259686591
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September 5th, 2012 at 11:28 pm 116
Realtors are lazy. They will drop everything to do a deal. But try getting them to submit the paperwork to report the sale.
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September 5th, 2012 at 11:29 pm 117
@Anonymous:
Yes, it’s called “aversion to a sure loss”. It is well-known in behavioural finance.
It will be two years before reality sinks in.
Wants 2 million dollars for a 1912 duplex and rides away from the interview on his mountain bike. What a douche!
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September 5th, 2012 at 11:44 pm 118
@ScubaSteve: “continually rebase”
If I’m not mistaken this is the first rebasing they’ve done in over 10 years. I don’t think that’s a crazy thing to do. I might be dim, but I just don’t see what the problem is.
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September 5th, 2012 at 11:45 pm 119
Anyone seeing properties priced below assessed?
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September 6th, 2012 at 12:06 am 120
@Anonymous: “what impact?”
When something — in this case the housing market — doesn’t behave, the first instinct is to look around for something to punch. “Spineless” bloggers are starting to get noticed.
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September 6th, 2012 at 2:58 am 121
@Okay Buddy:
“Its not racist to point out incidents, but trying to associate the actions of individuals across an entire group of people is.”
We are associating the actions of the playboy princeling with the entire group of corrupt Communist Party officials in China, just as the ordinary Chinese people are, as the news stories indicate.
So are you saying that the ordinary Chinese people are racist?
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September 6th, 2012 at 6:23 am 122
@Devore:
TakIng equity out of one’s home to live the high life is an epidemic in this country right now. I know a few who have. I ask the why the even bought in the first place…
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September 6th, 2012 at 6:28 am 123
@Muff Diver Mike:
You mean borrowing money to take the high life.
You take equity out of a house, or any other asset, by selling it.
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