Friday Free-for-all!

It’s that time of the week again!

lets do our regular end of the week news roundup and open topic discussion post for the weekend!

Here are a few recent links to kick off the chat:

Vancouver sales decline 32%
Vancouver drags down national numbers
Time to panic
Vancouver market cooling too quickly?
Last September was a different season
Realtors forced to change jobs
What did Billy do wrong?
HPI vs the San Diego bubble graph
Policies will not make housing affordable
House rich, lifestyle poor
Condos best rented, not owned

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

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Patiently Waiting
Member
Patiently Waiting

Check out these price drops on Burnaby Mountain:

http://vancouver.en.craigslist.ca/bnc/reb/3354545981.html

1 Bedroom 505sf Original Price $269,900 Now $239,900 ($30000 Incentive)
1 Bedroom + Den 631sf Original Price $324,900 Now $276,900 ($48000 Incentive)
1 Bedroom + Den 665sf Original Price $342,900 Now $279,900 ($63000 Incentive)
2 Bedroom + Den 785sf Original Price $428,900 Now $374,900 ($54000 Incentive)

Patiently Waiting
Member
Patiently Waiting

For the first time in 30 years, Surrey school enrollment dropped as 267 less students showed up than expected.

http://www.surreyleader.com/news/175006171.html

A Sun story says anecdotes indicate the drop maybe a combination of fewer refugee landings and people leaving for Alberta.

As Pradip Rodrigues said, competition is now so intense that even new immigrants are finding it impossible to make ends meet. In Toronto and Vancouver, incomes have been driven way down in low skill occupations like delivery driving and used house selling. Immigrants are now going to the Prairies where jobs pay well and family housing is still within grasp.

Anonymous
Guest
Anonymous

@Patiently Waiting: “Ethnic groups, religious affiliations and extended families play a huge role in real estate bubbles.”

In other words people drive real estate bubbles.

Anonymous
Guest
Anonymous

@Jack: “Go to 25% minimum down payments”

The banks will already lend with 20% down so the government has not control after that. Going to 20% simply eliminates CMHC insurance.

painted turtle
Guest
painted turtle

@rp1
Hard to tell without seeing the location and condition.
I would say I would pay in the $200-$250k range.
If the location is really nice, may be $300.
Still half the price they are asking for…

The house I am renting is worth 1.2 million (land value only).
I would not pay $600,000 for this house since it needs major work in the foundations.
It is hard to estimate a house price without knowing the details.

Patiently Waiting
Member
Patiently Waiting

@patriotz: Yes, you could remove “South Asian” and replace it with any other ethnic group. Ethnic groups, religious affiliations and extended families play a huge role in real estate bubbles. This was also discovered in the 2007-2009 American bubble blogs.

WOWSERS
Guest
WOWSERS

Does PREC mean prick in the RE biz cause I sure thinks there’s correlation!

anon123
Guest
anon123

@Patiently Waiting: That explains why I received unsolicited pitches from two different source this week. Not r t r ds themselves, but helping a friend or relative, probably. Pitch: “Hey, I just found out there is this property near my house, a real bargain at $….. (exact list price), won’t last long, there aren’t many like it, a must see. I though you may be interested, should definitely take a look.” Reality: overpriced crap.

Very suspicious, same timing, almost same pitch and sudden interest in finding RE for me. I guess is not my welfare they’re concerned about.

Jack
Guest
Jack

oneangryslav2 Says:

October 20th, 2012 at 11:48 pm

“But killing this RE bubble is easy: 20% down payments and no more HELOCs and it’s slaughtered”

—————————————
Why stop at 20%?

Go to 25% minimum down payments and have CMHC reduce the maximum insurance from $1 million down to $500,000.

patriotz
Member

@Aaaah:
“Pradip Rodrigues is not representative of the South Asian community in Vancouver.”

Representative in what sense? Ethnically, which seems to be what you’re concerned about, no. In the sense of trying to make a fast buck out of RE, I would say very much so, given a sampling of the realtors’ names you can see on For Sale signs, advertising, and the MLS.

Aaaah
Guest
Aaaah

@Patiently Waiting: Pradip Rodrigues is not representative of the South Asian community in Vancouver. For one thing, he lives in Toronto. A second think you’ll notice is his last name – Rodrigues. He is from Bombay, where as the vast majority of South Asians in the lower mainland are from Punjab region.

rp1
Guest
rp1

@oneangryslav2: I’m watching M2, and it’s “bubble on”:

http://credit.bankofcanada.ca/monetaryaggregates

oneangryslav2
Guest
oneangryslav2

@Anonymous:

Second his goal is to deflate it and raising interest rates to do so is not off the table.

In this economic environment, there is simply no room to raise interest rates prior to the US doing so. But killing this RE bubble is easy: 20% down payments and no more HELOCs and it’s slaughtered.

Anonymous
Guest
Anonymous
The Developing Canadian Housing Crisis An interesting quote from Mark Carney below. First he acknowledges the ‘bubble’. Second his goal is to deflate it and raising interest rates to do so is not off the table. If the recent changes don’t do it more tightening to come. The end is nigh. Following a speech in Nanaimo, B.C. Bank of Canada Governor Mark Carney stated: “Efforts by Finance Minister Jim Flaherty and the Office of the Superintendent of Financial Institutions (OSFI) to deter new mortgages are still having an impact on the housing market. We are watching with great interest the sum of those policies and their effect on the evolution of household debt. Raising interest rates to deflate a household debt bubble would be a last line of defence. However, if we were to lean against emerging imbalances in household… Read more »
N
Guest
N

@pricedoutfornow:

I moved here from Brooklyn and I would bet you dimes to dollars that the brownstone in question includes three rental units (one per floor), which rent for a combined $7K. That would be pretty typical for the neighborhood.

rp1
Guest
rp1
#84 @Arthur Fonzarelli: “Curious what some of you guys think is reasonable value for place like this over next 2-3 year” http://www.realtor.ca/propertyDetails.aspx?propertyId=12515092&PidKey=1733079134 For me it’s getting increasingly difficult to say what the expected scenario should be. Should we compare ourselves to the US? Then 400k makes sense if rents aren’t going to fall. But Canada’s bubble is by any measure larger than the American one, and it seems like the median family here is more economically compromised simply because of how long this has dragged on. Our economy is much more reliant on commodities and China’s bubble than anyone would care to admit. Question, what happens to Canadian house prices if: a) Michael Pettis’ prediction comes true: http://www.mpettis.com/2012/09/16/by-2015-hard-commodity-prices-will-have-collapsed/ b) The China bubble blows up http://www.alsosprachanalyst.com/special/china-economy-hard-landing-and-life-after c) Canadian banks curtail credit, having underestimated the problem http://www.theeconomicanalyst.com/content/vancouver-housing-full-correction-mode-implications-canadian-banks d) Canadian municipalities raise property… Read more »
gokou3
Guest
gokou3

Look at this patch of reds in the burnaby south attached:

http://byron.livefraservalley.ca/results.aspx?rid=320703659

Notably, 7478 Byrnepark Walk #421 has had price drops of $100k+

pricedoutfornow
Guest
pricedoutfornow

@Anonymous:

Re: 3 units, you’re right, my bad! I thought it said 3 bedroom. That’s what you get for reading while holding a fussy baby!

Still, shows you once again how bad the investment value is in Vancouver, compared with the US, even NYC for god’s sakes!

Patiently Waiting
Member
Patiently Waiting
Business is getting vicious as South Asian realtors irritate their friends and family. “Look at Real Estate brokers. Every second South Asian has a family member or a friend in this business. I for one have one family member and several friends who have all solicited me for business asking when I intend selling. Every time I talk with any of them, they ask if I or any of my friends are moving or want to invest in real estate. I don’t have the heart to tell them that all my friends have realtors in the family. I am so afraid to move because I’ll then be forced to choose. One person I know wanted to sell his home, found that it would be cheaper if he sat for the real estate exam and sell his own house and in… Read more »
oneangryslav2
Guest
oneangryslav2

@G:

On Canequity website, it has average loan size for different cities:
http://www.canequity.com/british-columbia/vancouver-mortgages.htm
For Vancouver, Average Loan size: $278,462.00

http://www.livingin-canada.com/house-prices-canada.html
Average Vancouver housing price: $752,000

I perused that website and couldn’t find any detailed information about what exactly they’re calculating. Do they include 2nd mortgages?

If Canequity originates a lot of 2nd mortgages then that would have an impact on the “average” loan size.

2 1st mortgages at 400K each, with one 2nd mortgage at 100K means an “average” mortgage of 300K.

painted turtle
Guest
painted turtle

@mac
459 16TH AVE W
Duplex
Considering the noise and the pollution, I would not spend more than $500 K.
For the past two months, I noticed that:
(initial asking price) x 0.5 or 0.6 = price I am willing to pay.

mac
Member
mac
We went to an open house today. A Kits townhouse that has been on the market for about 18 months. That’s the last time I toured it. It got “sold” a year ago (yeah, right!) and when we went today, it was just as empty with the same fake furniture. Gosh, that was nice of the seller. Anyway, compared to a few years ago when you couldn’t get a question answered at an open house our conversation with the agent was insane. US: Hi Agent: Hi, would you like a brochure? US: No thanks, everything is on the internet. Agent: How did you find out about this open house? US: The internet Agent: Oh! OK. Ha ha. Have you been looking for long? Me: Not really. Just since I was six. Agent: Oh! Ha ha… do you need to move… Read more »
mac
Member
mac

@No Money Down: I think those are the ones. 400 block of 16th, on the North Side because of the odd number. I remember that pricing too.

WOWSERS
Guest
WOWSERS

I think with all these presales, buyers are thinking that a couple years from now they will be worth more, the flip side is existing condo sales are suffering and only getting worse. !2013 is gonna be gong show, free entertainment folks.

More Data Please
Guest
More Data Please

“…[BC] bureaucrat spent $70,200 on rent in Vancouver…”

http://www.cbc.ca/news/canada/british-columbia/story/2012/10/19/bc-expenses-no-receipts.html

I really enjoy the anecdotes on this forum, so I thought others would enjoy this one.

As in: Aha! Now I know where that fictitious rental demand is coming from. It’s taxpayer money. Stop it now you jerky jerks. We need civil servants, not civil masters! In this case, $70,200 would buy a lot of one night stays in hotels. Is this a “mistress suite”?