The first one’s free
Joe checked the screen on his phone one more time and nervously glanced from side to side. He should be here by now. Joe needed his fix and he needed it bad.
A truck rolled by belching blue exhaust under the streetlamps and Joe spotted movement in the doorway across the street.
Could it be?
Yes!
Carney stepped out from the shadows and strolled across the road, his hands pushed deep in the pockets of his merino wool trench coat.
“Looking for something Joe?”
Joe fidgeted with the cell phone in his hand and his eyes dropped to the sidewalk. “Come on man, you know what I need”
A small smile played on the corner of Carneys mouth. “Ok Joe, this week we have a two for one deal, but don’t take too much, this stuff can be dangerous and any day now I’m going to up the potency.”
Joe eagerly held out his hand “yeah ok”
Carney raised an eyebrow “yeah ok?”
Joes hand shook. “yeah, you say that everytime”
Carney shook his head in disgust. “yeah, I guess I do but that doesn’t make it any less true. An OD on credit isn’t a pretty thing Joe”
Joe looked up with a glare “just give me the stuff man”
Carney passed the bag over and shook his head. “one of these days this stuff is gonna kill you, but there’s nothing I can do about that. All I can do is warn you. Good luck Joe.”
October 9th, 2012 at 12:29 am 1
Ha! I was wondering when we’d get more bear porn. You should write a whole novel.
Hot debate. What do you think?
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October 9th, 2012 at 1:16 am 2
This quote has been hanging on Canada bank’s home page for a long time, and I can’t stop being amazed by it:
“We work to preserve the value of money by keeping inflation low and stable.”
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October 9th, 2012 at 1:41 am 3
This line from Reservoir Dogs is very apt for Carney:
http://www.youtube.com/watch?v=U0Y7brwz6fA
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October 9th, 2012 at 4:34 am 4
Ireland Plans Bold Measures to Lift Housing
Ireland seems to be considering some sort of scheme to forgive mortgage debt across the board. The article is unclear about just who is supposed to take the hit for this. Ireland’s banks are essentially wards of the state and it would seem to me that it would be the taxpayer.
The headline is also off the mark IMHO, nothing is going to “lift” housing in Ireland or anywhere else except for an improvement in the real economy.
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October 9th, 2012 at 5:38 am 5
@4 patriotz: Ireland led the way in screwing themselves, it’s no surprise they might stay the course.
“In many ways, Ireland has to try something audacious. House prices are still 50 percent below their peak, compared with 30 percent in the United States. “
Good lord, they still don’t get it. If you have two incomes and can’t cover $1400, you shouldn’t own.
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October 9th, 2012 at 6:49 am 6
Carney’s no dealer, he just lowered the street price. As Chris Rock said, drug dealers never sold him drugs he didn’t want.
Hot debate. What do you think?
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October 9th, 2012 at 7:07 am 7
Interesting story on what is happening right now in Spain and from a peak 7.7x earnings house price.
Obviously this has nothing to do with Vancouver as 7.7x house price to earnings was passed without incident years ago(sarcasm/).
http://www.bloomberg.com/news/2012-10-08/spain-foreclosures-spread-to-once-wealthy-mortgages.html
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October 9th, 2012 at 8:00 am 8
What makes Gregor Robertson think rents are high? He talks as if rents and mortgages were interchangeable. I’m not even sure that rents are particularly high for a regional capital of this size. Probably a bit, but nothing like what is going on with purchase prices. If he doesn’t see that the is a gaping chasm between purchase prices and rental prices, how can he plan effectively?
http://www.vancouversun.com/Opinion/Op-Ed/Unaffordable+housing+damaging+Vancouver+community+fibre/7360071/story.html
Hot debate. What do you think?
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October 9th, 2012 at 8:08 am 9
@jesse:
Right. He’s a manufacturer. He’s Walter White.
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October 9th, 2012 at 8:27 am 10
@N: “What makes Gregor Robertson think rents are high?”
You have to look at who Gregor Robertson caters to. People on social assistance, druggies and rooming house residents.
Hot debate. What do you think?
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October 9th, 2012 at 8:47 am 11
Gregor Robertson, as mayor, definitely does not cater to the “poor and down trodden”. The social programmes he appears to have started such as more housing for the homeless, were begun years ago – he just happened to be in charge when they were completed. Gregors’ main thrust at this point seems to be appeasing his wealthy base – how else can one explain his hare-brained scheme to wall of Point Grey Road from Macdonald to Alma and turn it into a bike path because the residents are “afraid to cross” such a busy street. It appears that if a way can be shown to make the wealthy donors happy, Gregor is all for it.
Hot debate. What do you think?
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October 9th, 2012 at 9:02 am 12
Rents in Vancouver ARE high! All I can say right now is that I used to be able to afford to rent in Vancouver in the early 2000s and late 1990s with a minimum wage full time job.
I still essentially make the same amount of money today. But I can’t afford Vancouver rents now. Something has changed in the rental market. I don’t have time right now to retrieve the data to back this up. I just know that I used to be able to afford Vancouver rents and now I can’t. Also, I used to be able to rent with a cat in Vancouver and now I can’t.
That’s why I rent in Surrey. Not only can I afford the rent in Surrey, the quality of rentals is much better in Surrey, plus I’m allowed my cat. Maybe I could afford to rent in Vancouver if I rented a decrepid basement suite or an SRO hotel in Vancouver. But I have my standards. I want to rent something half way decent, with reliable utilities and no pest problems. I used to be able to get that in Vancouver and now I can’t.
Hot debate. What do you think?
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October 9th, 2012 at 9:06 am 13
Nonsense.
Compared to the cost of buying, or compared to rents in many other nice/large cities, Van rents are very modest.
Hot debate. What do you think?
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October 9th, 2012 at 9:10 am 14
Regarding Mayor Robertson’s politics:
He mainly cares about the faux wealthy yuppies and hispters who have taken over the city (I was going to say on the west side, but the yuppies have taken over the east side now too). The whole greenest city on earth agenda and bike paths things is about appeasing this middle class base. The middle class yuppies of Vancouver like green urbanism, this appeals to them.
Absolutely, Vancouver is lacking in community due to high housing costs (and I mean high rents–I am one of the creative types pushed out to Surrey by high rents–thinking about leaving the province soon). Maybe some of the west side yuppies are getting sick of living on streets with HAM-bought homes that sit empty. So again, this community rhetoric from Robertson is about appeasing middle class yuppies.
He doesn’t actually care about working poor renters like me. The only social housing that Vision Vancouver ever even talks about is SUPPORTIVE housing for drug addicts. While working people on minimum wage leave the city in droves because of HIGH RENTS, Vision Vancouver only cares about non-market rental housing directed at DRUG addicts.
Vision Vancouver issued demolition permits for Little Mountain Housing Project–which was not for drug addicts, it was housing for low income families and seniors. It had a very strong sense of community. If Vision Vancouver cared about fostering a sense of community in Vancouver they wouldn’t be complicit with the redevelopment of Little Mountain.
It absolutely is true that Vision Vancouver is bought and paid for by developers. That’s why the thin streets affordable housing plan is such a farce. Nothing Vision Vancouver will do will create affordable housing for non-drug addicts. Thin streets and ecodensity will only benefit developers and add more fuel to the bubble mania.
Hot debate. What do you think?
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October 9th, 2012 at 9:16 am 15
Just a case in point to demonstrate the increase in rents in Vancouver.
I used to rent from a certain apartment building on the east side of Vancouver in 1999. My rent was $525 for a one bedroom. I was talking to a friend last year who rents in the very same building. One bedroom’s now are $950 in that building, with no upgrades since I lived there.
So you get to live in an even older, $hittier building for almost double what it used to cost 12 years ago! Have wages doubled in 12 years? I think not. Minimum wage was frozen for most of that time.
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October 9th, 2012 at 9:18 am 16
@joe_blown_away_by_high_housing_costs:
Being able to live exactly where you want in a minimum wage position is not a right in a market. If others earn more and can afford to pay, they have a right to displace you in a free market if you do not have that right to ownership of that land.
Hot debate. What do you think?
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October 9th, 2012 at 9:26 am 17
not sure what there is to dislike. If a new prospective tenant is willing to pay more, the landlord will take the higher rent if allowed.
Hot debate. What do you think?
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October 9th, 2012 at 9:29 am 18
@15 joe_blown_away_by_high_housing_costs Says: “I used to rent from a certain apartment building on the east side of Vancouver in 1999. My rent was $525 .. now are $950″
30.55% of that is inflation. In constant, adjusted dollars the rent is up 39%, probably in the range of the Provincial allowable increase over 13 years.
Hot debate. What do you think?
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October 9th, 2012 at 9:30 am 19
For those who think Vancouver rents are affordable I have this challenge:
Find me an apartment in the City of Vancouver that meets this criteria:
-monthly rent no more than $600
-one bedroom
-cats allowed
-at least on the second floor–no basement suites, no ground level suites, no hotel rooms, no rooms in someone’s house–a real apartment with a bathroom and a kitchen
Apartments like this used to be common in Vancouver in the late 1990s. I had a friend who rented in a fabulous character building in the West End for five-something and it met all this criteria. I seriously doubt you’d find anything like that in Vancouver today–and if you did I would be suspicious–too good to be true.
Hot debate. What do you think?
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October 9th, 2012 at 9:32 am 20
@fixie guy:
“30.55% of that is inflation. In constant, adjusted dollars the rent is up 39%, probably in the range of the Provincial allowable increase over 13 years.”
But wages haven’t kept up with that. Also, we have higher food costs and utilities now and more expensive bus fare.
Hot debate. What do you think?
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October 9th, 2012 at 9:35 am 21
@watcher:
“Being able to live exactly where you want in a minimum wage position is not a right in a market. If others earn more and can afford to pay, they have a right to displace you in a free market”
I didn’t say it was a right. Market forces is precisely the reason why I live in Surrey.
The point is I used to make minimum wage and could afford to rent in Vancouver. Today, on minimum wage, I can’t afford to rent in Vancouver. I am not making an argument about rights. I am making an argument that something has changed.
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October 9th, 2012 at 9:41 am 22
inflation, density, willingness of people to pay higher rents.
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October 9th, 2012 at 9:43 am 23
Hidden due to low comment rating. Click here to see.
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October 9th, 2012 at 9:47 am 24
@watcher:
Although it is certainly not a right enshrined in the Charter of Rights and Freedoms, from a functionality perspective, don’t we need some minimum wage workers living and working in Vancouver?
When I used to live in Vancouver and I made minimum wage–guess where I worked? I worked right in Downtown Vancouver.
Living out in Surrey on minimum wage today, guess where I work now? It’s NOT in Vancouver. Any job in Vancouver would have to pay me more to make up for the doubling of my transit costs. But employers in Vancouver aren’t paying more than employers in Surrey. A one-zone fare within Surrey is $2.50. But if I have to go to Vancouver for a job, it’s a 3-zone fare for $5. So Vancouver isn’t going to be getting very many minimum wage workers. Your only source of minimum wage workers in Vancouver is teenagers who don’t have to pay rents. I can tell you from experience that teenagers are not as good, not as reliable as older minimum wage workers who live in the real world and have to pay rent.
You’re not going to get low wage workers in Vancouver if low wage workers can’t afford to live in Vancouver and if they are financially punished for commuting into Vancouver by a zone fare system.
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October 9th, 2012 at 9:50 am 25
@Ted:
NONE OF YOUR BUSINESS! I make myself vulnerable by posting selective details of my life on this blog. I do so to make an intellectual point at the risk some rude person like you will take the chance to ridicule me.
I live with the shame and embarrassment of my dead-end career and useless university degrees every day of my life. Most of the time I am far smarter than my rich employers and customers I serve–yet they get to look down on me. I don’t need more ridicule from this blog.
I shared something about myself in order to advance the conservation of this blog–not to take abuse.
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October 9th, 2012 at 9:58 am 26
@joe_blown_away_by_high_housing_costs:
“For those who think Vancouver rents are affordable I have this challenge:”
Surely rents are set at exactly the rate the market is willing to pay, collectively. So don’t rents always have to be affordable, by definition?
Hot debate. What do you think?
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October 9th, 2012 at 10:07 am 27
@joe_blown_away_by_high_housing_costs: ” I am making an argument that something has changed.”
By contrast I haven’t seen basement suite rents away from “trendy” areas like Main/Cambie/Commercial increase substantially in real terms over that time. I’m looking at areas like South Burnaby, Killarney, and Coquitlam. There is a stark difference between what you (and CMHC surveys) claim rents are increasing by and what is claimed by CPI “rented accommodation” for Vancouver CMA, the latter of which claims real rents have been dropping for decades now.
A complex I used to live in has seen its rents increase faster than CPI inflation in the past 10 years. So something is going on that doesn’t jive with CPI.
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October 9th, 2012 at 10:11 am 28
Vote Down The Facts Say: “Surely rents are set at exactly the rate the market is willing to pay, collectively. So don’t rents always have to be affordable, by definition?”
So how come Regina or Calgary, where household income is higher the Vancouver, have 20-30% cheaper rent then Vancouver?
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October 9th, 2012 at 10:11 am 29
I think part of the picture we are missing so far in this conversation is the role of international students.
One of the things that has changed over the past 13 years is a huge increase in the number of international students who come to Vancouver to learn English and to get a western university degree from UBC or SFU.
These international students have to live somewhere–the vast majority of them rent. The money they are bringing over here to pay rent comes from their parents, in their home countries, usually in Asia.
So yes, market forces have caused low wage workers who used to be able to afford rent in Vancouver to move to Surrey. But the increase in demand for rental housing is not rooted in the local economy. It is foreign money entering our rental market through international students.
Hot debate. What do you think?
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October 9th, 2012 at 10:13 am 30
@Vote Down The Facts: “So don’t rents always have to be affordable, by definition”
“Affordability” is typically defined as no more than 30% of pre-tax income towards housing. So no rents are not “affordable” by definition.
Hot debate. What do you think?
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October 9th, 2012 at 10:21 am 31
@jesse:
Well the example I gave of an apartment that I rented for $525 that now costs $950 is in the Commercial Drive area. This is a trendy area today. But back in the 90s it was pretty ghetto. I remember I had friends who lived in the West End who were afraid to come visit me near Commercial Drive. One time I had a party at my place, and someone from the West End was so scared of Commercial Drive they hopped in a cab as soon as they got off the skytrain at Broadway. It was way cooler to live on Commercial Drive back then, back before it gentrified (and when it still had Italians!!!)
But I know of similar cases of rent increases in Marpole–which isn’t exactly a trendy area like Commercial Drive.
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October 9th, 2012 at 10:21 am 32
@joe_blown_away_by_high_housing_costs: If you’re going to make this assertion without being labeled, you should spend a couple of minutes backing it up with data. There should be figures available for major institutions.
Hot debate. What do you think?
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October 9th, 2012 at 10:25 am 33
@joe_blown_away_by_high_housing_costs: “back before it gentrified”
And by “gentrified” I think you mean rents have gone up. Asking because I think this is a good conversation, is gentrification in a growing city surprising?
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October 9th, 2012 at 10:26 am 34
@Ted: Hey Ted, nobody has to explain their life to you. The topic is Vancouver real estate, rentals, mortgages, interest rates etc.
Hot debate. What do you think?
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October 9th, 2012 at 10:57 am 35
@Jesse
When I use the word “gentrification” I am thinking about the four elements of gentrification identified by Loretta Lees, Tom Slater, and Elvin Wyly (2008) in their text book entitled “Gentrification”:
The four elements of gentrification are: “(1) the reinvestment of capital; (2) the social upgrading of locale by incoming high-income groups; (3) landscape change; and (4) direct or indirect displacement of low-income groups” (Lees et al., 2008, p. 158).
I think we have all of this present in the Commercial Drive area in the first decade of the 21st century. Don’t ask me to get the data because I am trying to enjoy my day off.
1. Reinvestment of capital–check–credit bubble anyone?
2. Social upgrading: New people moving to Commercial Drive are higher class than the people who lived there before. Social class includes income, employment, and education. In order to call it “gentrification” the new people moving to Commercial Drive should have higher incomes, higher status jobs, and higher education levels than the people who lived there before.
3. Landscape change–this just means the built physical environment has to be changed in order to call it gentrification. People taking out HELOCs to renovate their homes would qualify. Renovated housing stock, old housing stock demolished and replaced with new housing stock.
4. Displacement of low income groups that previously called the neighbourhood home. Direct displacement happens when people are renovicted. Indirect displacement happens when people don’t even move their in the first place–low income people who may have afforded to live there before don’t even get a foothold in the neighbourhood in the first place due to higher rents.
I am absolutely convinved that the data will show all of this has happened to the Commercial Drive area in the first decade of the 21st century. It was a working class Italian neighbourhood that has been gentrified by hipsters and lesbians. Hipsters/artists have been identified as gentrifiers in other contexts (cf. the work of David Ley, Richard Florida) as well as gays (cf. the work of Knopp, 1990, 1997).
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October 9th, 2012 at 10:58 am 36
@Turkey:
“If you’re going to make this assertion without being labeled, you should spend a couple of minutes backing it up with data. There should be figures available for major institutions.”
I was trying to enjoy my day off from my degrading minimum wage job. For myself, I don’t need data because I know I can’t afford Vancouver rents. Most renters know what they can afford and what they can’t afford. It is part of your reality. I have known for over a decade that for the kind of apartment I want to rent (cats okay, at least on the second floor, not a total dive), I have to look outside Vancouver. First it was New West, where I rented a place for $580 that met all this criteria until I was renovicted in 2007. Now I am in Surrey. At the rate I am going, next stop will be Abbotsford.
But fine, I will look up the rental market data from CMHC if it makes you happy.
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October 9th, 2012 at 11:05 am 37
Hidden due to low comment rating. Click here to see.
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October 9th, 2012 at 11:06 am 38
@joe_blown_away_by_high_housing_costs: “I am absolutely convinved that the data will show all of this has happened”
Yes… but are you surprised this is happening?
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October 9th, 2012 at 11:21 am 39
@Ted: “all the bears thought the rents would not go up substantially and that was the reason real estate prices would collapse”
And they haven’t gone up “substantially” compared to prices. I (for one) am a “bear” but have never claimed rents are going to fall. Here’s a link to the Vancouver condo price-rent graph using data in line with joe’s anecdotes (CMHC rental survey data)
http://housing-analysis.blogspot.ca/2012/08/price-to-rent-ratios-for-vancouver.html
Even by the measure of rising real rents, which is the most optimistic data we can use, Vancouver condo prices are 70% above their long-term average.
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October 9th, 2012 at 11:27 am 40
@Turkey:
I thought I could quickly access CMHC Rental Markey Reports for the 1990s but it appears that CMHC website does not keep these archives. But I was able to find a CMHC Rental Market Report for Vancouver CMA from 2007 in the bowels of my hard drive and compare this with the 2011 data currently on the CMHC website. The 2007 report gives data from 2006 for comparison. So we have a 5 year window to look at.
Average rent for a one-bedroom apartment in the City of Vancouver in October 2006 was $868. For Surrey, it was $655.
Average rent for a one-bedroom apartment in the City of Vancouver in October 2011 was $1045. For Surrey, it was $718.
Over 5 years, rents for one-bedroom apartments in Vancouver increased 20.4%, while in Surrey those rents only increased 9.6% over the same time period.
The CMHC survey does not control for differences in the quality of housing stock. In my experience, the one-bedroom rentals in Vancouver are older and poorer quality than one-bedroom rentals in Surrey. Also, it is still possible to find rentals in Surrey that accept cats, which are almost banned from Vancouver rentals. So rents in Surrey are cheaper, are increasing at a slower rate, and are buying you a higher quality unit where you can keep your cat. Surrey wins hands down!
I am sure you would see even a more dramatic picture if we could look at data going back to the 1990s but I can’t find it quickly right now. I lived in Vancouver all my life until 2001 when I left for New West because of high rents in Vancouver. So by 2007, Vancouver rents (for the quality of housing you can get) had already been unaffordable to me for 6 years.
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October 9th, 2012 at 11:32 am 41
@Jesse:
No gentrification in Vancouver is not surprising. As Neil Smith wrote, “gentrification is global urban strategy”.
But it’s certainly not fun or uncontested. It can lead to all sorts of negative unexpected social outcomes. Lack of a sense of community in Vancouver is one such outcome, IMHO
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October 9th, 2012 at 11:33 am 42
Quick question, are the REBGV inventory numbers only those listings on MLS or do they include office exclusive listings as well? The reason I ask is that I drive by 5 new builds that are for sale but don’t show up on MLS.
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October 9th, 2012 at 11:33 am 43
@joe_blown_away_by_high_housing_costs: Sorry, I meant to quote your original comment to put it in context.
This seems like it needs justification to me. I don’t want to be a dick about it, but it’s another way to pin Vancouver’s housing obsession on foreign interests, and I didn’t want it to slip in without critical inspection.
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October 9th, 2012 at 11:39 am 44
@joe_blown_away_by_high_housing_costs: I have data for Vancouver CMA (CANSIM 027-0040) 1 BR apartment, Apartment structures of six units and over:
Since 2001, according to the CMHC survey, Vancouver CMA 1 BR rents have increased 2.87% per year. I’ll see if I can dig up Surrey vs Vancouver.
Hot debate. What do you think?
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October 9th, 2012 at 11:39 am 45
From todays Globe….
IMF cuts Canada outlook
The International Monetary Fund is taking a dimmer view of Canada, cutting its economic forecasts and warning of the threats from the housing market and swollen consumer debt levels.
A bit too late!
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October 9th, 2012 at 11:40 am 46
“But the increase in demand for rental housing is not rooted in the local economy. It is foreign money entering our rental market through international students.”
Would your analysis be different if the renter was a kid from Kamloops? It seems to me that someone who’s going to live in below-median housing and spend money on tuition and food is just the sort you want to attract.
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October 9th, 2012 at 11:43 am 47
@Jesse:
Wow! Great data! But unfortunately, it’s for the entire Vancouver Census Metropolitan Area, which includes the suburbs. The issue at hand is rent increases just within the City of Vancouver.
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October 9th, 2012 at 11:46 am 48
@jesse: ‘“Affordability” is typically defined as no more than 30% of pre-tax income towards housing. So no rents are not “affordable” by definition.’
If the market cannot afford the rents being offered, then surely prices should be driven downwards. That doesn’t appear to be happening. Rents are ‘high’ because people are prepared to pay it.
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October 9th, 2012 at 11:46 am 49
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October 9th, 2012 at 11:49 am 50
@Ralph Cramdown: “But the increase in demand for rental housing is not rooted in the local economy. It is foreign money entering our rental market through international students.”
Would your analysis be different if the renter was a kid from Kamloops? It seems to me that someone who’s going to live in below-median housing and spend money on tuition and food is just the sort you want to attract.
Yes, it would be different because a kid from Kamloops would likely work in the local economy.
People on this blog are saying high rent increases in Vancouver are the natural result of market forces. They are implying that wage growth has kept up with rent increases. But I suspect a lot of the rent increase in Vancouver is due to international students. Most international students have all of their living expenses paid by their parents. They don’t need to get a minimum wage job in Vancouver in order to pay the rent. So their effective demand (how much they can pay for rent) does not reflect local wages.
This also can explain why rents increased 20% in Vancouver over 5 years and not even 10% in Surrey. Not too many international students are renting in Surrey. In my experience, there are actually BETTER job options in Surrey that tend to pay a bit more than minimum wage, whereas in Vancouver the crap jobs are REALLY crap.
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October 9th, 2012 at 11:54 am 51
Vote Down The Facts Says:” Rents are ‘high’ because people are prepared to pay it.”
being prepared to pay is not the same as affordable. what other option do they have? to move to Flin Flon Manitoba?
Hot debate. What do you think?
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October 9th, 2012 at 12:02 pm 52
@Ted:
Nice try, but this does not square with the facts:
2 bedroom Spectrum (asking $1850, $1925)
http://vancouver.en.craigslist.ca/van/apa/3301062102.html
http://vancouver.en.craigslist.ca/van/apa/3301188952.html
There are ads asking for more, but in my experience there are always a lot of overly optimistic ads on CL and the lowest prices ones are usually most representative of the real market rate.
On a more fundamental level, this whole talk about whether rents are going up/down is pretty easy to resolve. The overwhelming evidence shows that rents are extremely stable, and basically increase at a rate very close to inflation. Individual anecdotes aside, this is what all the data point to time and time again. The housing market has almost no correlation with rental rates – whether purchase prices are high or low, going up or going down.
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October 9th, 2012 at 12:07 pm 53
…what other option do they have? to move to Flin Flon Manitoba?
YES! Can’t pay the market cost then you’re simply out of luck!
Hot debate. What do you think?
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October 9th, 2012 at 12:12 pm 54
If anyone doubts the role of international students in rising rents in Vancouver, just consider this:
“The number of international students in Metro Vancouver engaging in a program of study at least six months in duration and who require a student visa has increased more than 75% over the ten-year period, from 22,450 in 2000 to 39,550 by 2009.”
http://mbc.metropolis.net/assets/uploads/files/TROtherVancouver_factsheet3_final.pdf
Unless they are all buying real estate, how could this major influx of students NOT have affected rents in Vancouver?! The role of students increasing rents is well recognized in small university towns like Waterloo, Ontario. They have a role in Vancouver too, it just goes under the radar a bit because we’re a bigger city.
And now the BC Liberals want to increase the number of international students by an additional 50%. I’ve seen some commenters suggest this is a desperate attempt to keep some air in the real estate bubble. I have no doubt that is true. If we can prop up rents with international students, then that might help support the real estate bubble to some extent.
Hot debate. What do you think?
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October 9th, 2012 at 12:13 pm 55
Speaking of rents, we’ve been looking for a bigger place to rent for awhile now. Came upon this listing-think we’ll be seeing more of these as accidental landlords try to unload properties they thought they could flip: Rent, or rent to own:
http://vancouver.en.craigslist.ca/van/apa/3279065334.html
Also, $3500…ouch! Is it just me or is this really expensive for a townhouse? It says “rent is negotiable”-should I offer $1800?
Hot debate. What do you think?
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October 9th, 2012 at 12:21 pm 56
@Ted: “…what other option do they have? to move to Flin Flon Manitoba?
YES! Can’t pay the market cost then you’re simply out of luck!”
And when the only people left in Vancouver are homeowners, retired seniors, international students, and drug addicts living in supportive housing, the market will have spoken.
When there is nobody left in Vancouver to work in minimum wage jobs, to work in food courts and as sandwich artists, or to work in jobs that are slightly above minimum wage as hospital cleaners and food preppers, then the market will have spoken.
Vancouver is becoming a dead zone to low wage working people.
Hot debate. What do you think?
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October 9th, 2012 at 12:36 pm 57
Just to add a datapoint, in 1997-1999 I was living in a 1br in Kits and then VGH area paying about $800/month. Standard 3-floor old stock rental apartments. Essentially the same thing is going for $1000-1100 now e.g. this:
http://vancouver.en.craigslist.ca/van/apa/3266912197.html
Hot debate. What do you think?
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October 9th, 2012 at 12:46 pm 58
@joe_blown_away_by_high_housing_costs:
…except, we’re only talking about downtown vancouver rents (not metro vancouver, right?), and those extra students don’t all live within Vancouver city limits.
If we look at the metro area after all, that’s 17,000 international students compared to a population growth of about 230,000 (BC Census, Vancouver metropolitan area, 2001-2009.) It’s not nothing, but it’s hardly an invasion.
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October 9th, 2012 at 12:54 pm 59
@Vote Down The Facts: “Rents are ‘high’ because people are prepared to pay it.”
That does not make them “affordable”, which was the original comment. Other stipulations of “affordability”, as defined by CMHC, are that 1) the accommodations are in good repair and 2) the accommodations are suitable for the family size.
I am not stating Vancouver has an “affordability” problem/crisis and I am not disputing that people are managing to pay their rents. I am trying to clarify the terminology.
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October 9th, 2012 at 12:54 pm 60
http://www.cbc.ca/news/world/story/2012/10/09/imf-canada-outlook.html
interesting comments…
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October 9th, 2012 at 12:58 pm 61
@dev/null
That looks like a really good deal. I wonder if they allow cats? The ad doesn’t say.
$995 for a one bedroom in Kits is actually below market rent. According to CMHC data, average rent for a one bedroom in Kits/Point Grey in October 2011 was $1074.
The problem with rentals that are below market is that they are prime candidates for renoviction. When I rented a one bedroom in New West for $580 in 2007 that was below market too. Then I was renovicted. If the landlord sells to another rental company, the temptation is strong to renovict. They can evict you, make minor upgrades, and then rent it out for the market rate or more. That’s why I would still be a leery of a one bedroom in Kits for under a thousand. I think I’m better of resisting that temptation and staying in Surrey.
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October 9th, 2012 at 1:03 pm 62
@Turkey:
We’re talking about City of Vancouver rents (not just downtown and not all of Metro Vancouver).
I don’t think there is any data available on this, but I suspect the majority of the 39k international students who live in Metro Vancouver actually live in the City of Vancouver. Thus, there would be a disproportionate effect on rents within the City of Vancouver. That’s exactly what you see with a 20% increase in rents in the City of Vancouver and a 10% increase in a distant suburb like Surrey. There are probably also a fair number of international students in Burnaby (because of SFU) and in Richmond and maybe North Van. Surrey is probably not a big destination for international students.
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October 9th, 2012 at 1:14 pm 63
@joe_blown_away_by_high_housing_costs: “Vancouver is becoming a dead zone to low wage working people”
To play devil’s advocate, so what? Say I have a family of three earning $120K/year. If subsidized housing is built, it has knock-on effects to people of all income tiers who will end up moving to other areas of the region, the exact thing Robertson in his latest open lament highlights. It’s a matter of who gets to live in Vancouver — while it may not show up in a headline, devoting City land for lower income housing seems more to change the people who start barking in Robertson’s ear when he’s on the stump, but is unlikely to reduce the number of complaints.
Not that I agree or disagree, just trying to come at it from the side of someone who is displaced by various housing policies.
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October 9th, 2012 at 1:16 pm 64
@Turkey
“If we look at the metro area after all, that’s 17,000 international students compared to a population growth of about 230,000 (BC Census, Vancouver metropolitan area, 2001-2009.) It’s not nothing, but it’s hardly an invasion.”
But we have a very low vacancy rate. According to the CMHC Rental Market Report for 2011, the vacancy rate for one bedroom apartments in the City of Vancouver in October 2011 was 0.7%. That is extremely low. A healthy vacancy rate is considered to be 4%. Just for your own info, the vacancy rate for bachelor suites was 0.6%. 2 bedrooms was 0.8%, 3 bedrooms was 2.2%, overall was 0.7%.
With a 0.7% vacancy rate, 40,000 international students with parents overseas sending money over for rent is a huge difficulty for renters who have to work in the local economy. Now, we’re going to have to deal with even more international students!!! It is actually irresponsible for the government to be enticing international students to come over here without paying any regard to where they are going to live.
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October 9th, 2012 at 1:22 pm 65
@joe_blown_away_by_high_housing_costs: “But unfortunately, it’s for the entire Vancouver Census Metropolitan Area, which includes the suburbs. The issue at hand is rent increases just within the City of Vancouver”
Why should rent increases within the City of Vancouver be an issue? Would it help if Vancouver became a megacity like Toronto?
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October 9th, 2012 at 1:22 pm 66
@jesse:
“To play devil’s advocate, so what? ”
The ‘so what’ is that Vancouver needs low wage workers in order for the city to function. It’s not just minimum wage workers who are priced out of Vancouver, it’s even people with moderate incomes. The City needs people to work in its service sector, in the hsopitals, in the schools.
Some of the rental units at the Olympic Village have been reserved for teachers, firefighters, and police because these people are priced out of the city. What will Vancouver do if the police can’t afford to live there anymore? Go without police? There is a limit to how far a city can go with being a resort town for the wealthy. You need some working class people in order to function.
Having all the working people out in Surrey is not a good option. As I have already said, minimum wage people will work in Surrey if they have to live in Surrey. As far as the above minimum wagers and the police and firefighters, imagine what will happen in the event of an earthquake. If the big one ever hits, all the first responders will be on the other side of the Fraser River. The richies who live in Vancouver won’t get any medical care.
Hot debate. What do you think?
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October 9th, 2012 at 1:26 pm 67
@Jesse:
“But unfortunately, it’s for the entire Vancouver Census Metropolitan Area, which includes the suburbs. The issue at hand is rent increases just within the City of Vancouver”
Why should rent increases within the City of Vancouver be an issue? Would it help if Vancouver became a megacity like Toronto?”
Rents within the City of Vancouver is the issue at hand we are discussing, jesse. Please pay attention. This whole discussion started from Mayor Robertson talking about lack of community in Vancouver. Mayor Robertson is only the mayor of the City of Vancouver, not all of Metro Vancouver (although he likes to act like it). I chimed in with saying how I used to be able to afford the rents in the City of Vancouver on minimum wage but now I can only afford Surrey rents.
So it is important to separate out City of Vancouver rents from Vancouver CMA rents. Vancouver CMA includes Surrey. So you showed data that showed only modest rent increases for Vancouver CMA since the 90s–you are including Surrey, Langley, Maple Ridge, etc in your data. I’m not talking about all those places. I am saying the City of Vancouver has become unaffordable in recent years but the suburbs are still relatively affordable.
Hot debate. What do you think?
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October 9th, 2012 at 1:30 pm 68
But actually I do support the idea of a megacity for Metro Vancouver, as in the Toronto experience. But that is a whole other debate that I don’t have energy for today. Please, I need to do something else with my day other than post on this blog.
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October 9th, 2012 at 1:35 pm 69
@joe_blown_away_by_high_housing_costs:
Yes, but Vancouver has always had a low vacancy rate. I’m probably looking at the same table as you are — and it shows that 2009-2010 were among highest vacancy rates for bachelor and one-bedroom apartments over the past decade. The data is noisy, and things took a dip in 2011, but the argument from vacancy doesn’t look that solid to me.
Look, I’m really not excited about this argument (try it over beer sometime and I might be more willing.) I’m just trying to figure out how much of your argument can be buttressed by fact and how much is gut instinct. If there’s one thing I value about this blog, it’s the posters’ willingness to swim against the current of popular opinion when it isn’t consistent with the facts.
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October 9th, 2012 at 1:39 pm 70
@joe_blown_away_by_high_housing_costs: “I chimed in with saying how I used to be able to afford the rents in the City of Vancouver on minimum wage but now I can only afford Surrey rents. ”
Whose responsibility do you think it is to address that? Surely not private landlords?
Hot debate. What do you think?
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October 9th, 2012 at 1:46 pm 71
@Turkey:
“Yes, but Vancouver has always had a low vacancy rate. I’m probably looking at the same table as you are — and it shows that 2009-2010 were among highest vacancy rates for bachelor and one-bedroom apartments over the past decade.”
Yes, Vancouver has always had a low vacancy rate.
Vacancy rates for City of Vancouver, including suites with all numbers of bedrooms:
2011: 0.7%
2010: 1.3%
2009: 1.1%
2008: 0.3%
2007: 0.5%
2006: 0.3%
All of these are VERY low. 4% is considered healthy and we never come close to that. So how does adding 40,000 international students with mummy and daddy paying the rent from overseas do anything but make things worse for low wage workers who work in the local economy?
Hot debate. What do you think?
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October 9th, 2012 at 1:50 pm 72
@joe_blown_away_by_high_housing_costs: ” I am saying the City of Vancouver has become unaffordable in recent years but the suburbs are still relatively affordable.”
You are drawing lines based on city boundaries when in reality there is a regional problem. That Robertson has chosen to pander specifically to Vancouver does not mean Vancouver is operating in a vacuum, more likely that it’s hard to win votes trying to herd municipal mayors to make any meaningful housing policy decisions. I see Vancouver as being at the centre of a growing region that has transportation impedances due not only to geography and infrastructure but also to increasing fuel costs. Based on recent transportation cost increases and constant pressures of gentrification rents near the core seem likely to diverge. I don’t think that’s necessarily something to try to affect by subsidy.
“What will Vancouver do if the police can’t afford to live there anymore? Go without police? “
No they can commute like nurses and teachers. You are stating that the city proper needs to maintain housing for certain residents based on income tier. That’s fine — perhaps the City will be better served by forcing a more economically-diverse populace — but I don’t think it will reduce the number of complaints.
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October 9th, 2012 at 1:55 pm 73
@Vote Down the Facts
“I chimed in with saying how I used to be able to afford the rents in the City of Vancouver on minimum wage but now I can only afford Surrey rents. ”
Whose responsibility do you think it is to address that? Surely not private landlords?”
I haven’t even been getting into responsibility. But following the points I’ve made today, the government not inviting tens of thousands of international students would be a good start.
My views about this should already be known to followers of this blog. I am a socialist. I believe we need a national public housing program that provides subsidized rental housing to a large segment of our working class, low income and middle income people. Hong Kong has 50% of its housing stock as public housing, with priority going to those who are displaced by speculative activity in the private market. I would be happy with half that–just 25%. I agree with the Hong Kong approach of giving priority to those who are displaced in the private market. I vehemently disagree with the BC approach of giving priority to drug addicts. I disagree with the Ontario approach of giving priority to victims of domestic violence. Drug addicts and victims of domestic violence are too narrow of groups. I want public housing to be availabe to a larger segment of the population. I believe we have a SHORTAGE of affordable rental housing.
Most real estate bears disagree with me that there is a shortage of housing. They say the fact we have a bubble means that we actually have on OVER SUPPLY of housing. That may be true in absolute terms. When they get pushed to say something on this, real estate bears on this blog have said the over supply of housing in the form of too many condos should become our public housing. But the problem is our supply of ownership housing is not easily transferable into a supply of rental housing or public housing. Even when condos are rented out, they are more for the short terms until the owner can sell. Most middle class people would object to the government buying up foreclosed condo developments and using them as public housing. Public housing when it was first built was modest design so it would not compete with private housing.
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October 9th, 2012 at 1:56 pm 74
Hidden due to low comment rating. Click here to see.
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October 9th, 2012 at 2:00 pm 75
OMG I’m in moderation purgatory!
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October 9th, 2012 at 2:01 pm 76
@VDTF
I haven’t even been getting into responsibility. But following the points I’ve made today, the government not inviting tens of thousands of international students would be a good start.
My views about this should already be known to followers of this blog. I am a socialist. I believe we need a national public housing program that provides subsidized rental housing to a large segment of our working class, low income and middle income people. Hong Kong has 50% of its housing stock as public housing, with priority going to those who are displaced by speculative activity in the private market. I would be happy with half that–just 25%. I agree with the Hong Kong approach of giving priority to those who are displaced in the private market. I vehemently disagree with the BC approach of giving priority to drug addicts. I disagree with the Ontario approach of giving priority to victims of domestic violence. Drug addicts and victims of domestic violence are too narrow of groups. I want public housing to be availabe to a larger segment of the population. I believe we have a SHORTAGE of affordable rental housing.
Most real estate bears disagree with me that there is a shortage of housing. They say the fact we have a bubble means that we actually have on OVER SUPPLY of housing. That may be true in absolute terms. When they get pushed to say something on this, real estate bears on this blog have said the over supply of housing in the form of too many condos should become our public housing. But the problem is our supply of ownership housing is not easily transferable into a supply of rental housing or public housing. Even when condos are rented out, they are more for the short terms until the owner can sell. Most middle class people would object to the government buying up foreclosed condo developments and using them as public housing. Public housing when it was first built was modest design so it would not compete with private housing.
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October 9th, 2012 at 2:02 pm 77
There’s no rhyme or reason to when comments need to be moderated. I’ve been commenting all day without my comments needing to be moderated. Now all of a sudden, I’m blocked.
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October 9th, 2012 at 2:03 pm 78
@Vote Down the Facts
“I chimed in with saying how I used to be able to afford the rents in the City of Vancouver on minimum wage but now I can only afford Surrey rents. ”
Whose responsibility do you think it is to address that? Surely not private landlords?”
I haven’t even been getting into responsibility. But following the points I’ve made today, the government not inviting tens of thousands of international students would be a good start.
My views about this should already be known to followers of this blog. I am a socialist. I believe we need a national public housing program that provides subsidized rental housing to a large segment of our working class, low income and middle income people. Hong Kong has 50% of its housing stock as public housing, with priority going to those who are displaced by speculative activity in the private market. I would be happy with half that–just 25%. I agree with the Hong Kong approach of giving priority to those who are displaced in the private market. I vehemently disagree with the BC approach of giving priority to drug addicts. I disagree with the Ontario approach of giving priority to victims of domestic violence. Drug addicts and victims of domestic violence are too narrow of groups. I want public housing to be availabe to a larger segment of the population. I believe we have a SHORTAGE of affordable rental housing.
Most real estate bears disagree with me that there is a shortage of housing. They say the fact we have a bubble means that we actually have on OVER SUPPLY of housing. That may be true in absolute terms. When they get pushed to say something on this, real estate bears on this blog have said the over supply of housing in the form of too many condos should become our public housing. But the problem is our supply of ownership housing is not easily transferable into a supply of rental housing or public housing. Even when condos are rented out, they are more for the short terms until the owner can sell. Most middle class people would object to the government buying up foreclosed condo developments and using them as public housing. Public housing when it was first built was modest design so it would not compete with private housing.
Like or Dislike:
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October 9th, 2012 at 2:03 pm 79
Whose responsibility do you think it is to address that? Surely not private landlords?”
I haven’t even been getting into responsibility. But following the points I’ve made today, the government not inviting tens of thousands of international students would be a good start.
Like or Dislike:
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October 9th, 2012 at 2:04 pm 80
Whose responsibility do you think it is to address that? Surely not private landlords?”
My views about this should already be known to followers of this blog. I am a socialist. I believe we need a national public housing program that provides subsidized rental housing to a large segment of our working class, low income and middle income people. Hong Kong has 50% of its housing stock as public housing, with priority going to those who are displaced by speculative activity in the private market. I would be happy with half that–just 25%. I agree with the Hong Kong approach of giving priority to those who are displaced in the private market. I vehemently disagree with the BC approach of giving priority to drug addicts. I disagree with the Ontario approach of giving priority to victims of domestic violence. Drug addicts and victims of domestic violence are too narrow of groups. I want public housing to be availabe to a larger segment of the population. I believe we have a SHORTAGE of affordable rental housing.
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October 9th, 2012 at 2:25 pm 81
Hidden due to low comment rating. Click here to see.
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October 9th, 2012 at 2:38 pm 82
@72 Ted: You appear confused. That post had almost no logical content.
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October 9th, 2012 at 2:41 pm 83
@joe_blown_away_by_high_housing_costs:
International students pay about 5x the tuition fees. So they basically subsidize Canadians.
Hot debate. What do you think?
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October 9th, 2012 at 2:45 pm 84
Published vacancy rates are BS, they are purpose built rentals of which we have had very few built in the past decade. If you could capture all the amateur landlords out there or vacant investment properties I bet the city is more than 10 percent vacant. When I lived on yaletown and sat on strata, the building was only 80% occupied with the majority of empty units owned offshore. We found this out as we had to do an emergency valve replacement in every unit and were shocked at all the unoccupied suites.
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October 9th, 2012 at 2:59 pm 85
@fatso:
What are you guyz arguing about? Econ 100, demand consists of people ABLE and WILLING. So prepare to pay and affordable are both required. Not just one or the other. BOTH. If you are able to pay but not willing, no demand. If you are willing to pay but unable, no demand.
Hot debate. What do you think?
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October 9th, 2012 at 3:00 pm 86
@Vote Down The Facts:
“International students pay about 5x the tuition fees. So they basically subsidize Canadians.”
As long as they’re taking up empty places. If they displace qualified local students, or require hiring extra staff or building more facilities, that’s another story.
Hot debate. What do you think?
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October 9th, 2012 at 3:06 pm 87
@Morris
you are confused. willing to pay and affordable to pay is NOT the same.
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October 9th, 2012 at 3:10 pm 88
lots of ESl students stay with homestay families so they don’t compete directly for rentals.
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October 9th, 2012 at 3:13 pm 89
@Vote Down The Facts: ‘International students pay about 5x the tuition fees. So they basically subsidize Canadians.’
So they’re subsidizing the Canadians that didn’t get in because there weren’t enough spaces, right?
Hot debate. What do you think?
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October 9th, 2012 at 3:15 pm 90
@fatso:
“you are confused. willing to pay and affordable to pay is NOT the same.”
In macroeconomic terms they are. Someone decides either to buy a good or service at a given price or not. Beyond that it’s a value judgement.
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October 9th, 2012 at 3:35 pm 91
@jesse:
“pander to Vancouver” ??? Robertson is the MAYOR of Vancouver. Who else is he supposed to “pander” for ?
bizarre comment
Hot debate. What do you think?
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October 9th, 2012 at 4:02 pm 92
@mmp: “Who else is he supposed to “pander” for “
Pandering to voters without considering housing supply in other adjoining municipalities is populist and misses a big part of where regional housing supply is going to be coming from.
I’m not faulting Robertson for doing this.
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October 9th, 2012 at 4:07 pm 93
@patriotz: “If they displace qualified local students, or require hiring extra staff or building more facilities, that’s another story.”
Universities worldwide use international students to subsidize nationals.
Also, it seems a little odd you’d consider the hiring of extra staff or building more facilities – both with an obvious economic benefit – to be some kind of disadvantage.
Hot debate. What do you think?
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October 9th, 2012 at 4:20 pm 94
Hidden due to low comment rating. Click here to see.
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October 9th, 2012 at 5:14 pm 95
@patriotz: “…willing to pay and affordable to pay…a value judgement…”
Ya, once again you are textbook correct for what it’s worth.
On the other hand, sometimes laws are enacted to prevent the unethical from exploiting profitable externalities. The word externality has technical meaning in Economics, eh patriotz. Did I use it right?
Example:
http://www.parl.gc.ca/About/Parliament/LegislativeSummaries/bills_ls.asp?ls=c26&source=library_prb&Parl=39&Ses=1&Language=E
AND related:
Per your comments about one of my posts in the “Friday Free For All” on comparative mortgage cost: The economic utility of “sum of present value” also depends on whether you are the lender or borrower and what the relative material degree of consequence is for ending/breaking the contract, lender vs borrower. I agree the bank sees a mortgage as sum of present value payments, as you suggest. But I argue that the borrower, when not herded or pressured by cultural norms should see a restrictive, mobility limiting, and expensive ball and chain amounting to a few pennies gained over the balance of their remaining productive years.
In my view mortgages are a form of usury on those lacking means to finance an expensive consumer good (a home) by paying simple interest. Rather, they borrow still more money to finance interest, and interest on interest – aka the mortgage!
Hot debate. What do you think?
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October 9th, 2012 at 6:32 pm 96
New Listings 262
Price Changes 192
Sold Listings 119
TI:18921
http://www.paulboenisch.com
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October 9th, 2012 at 6:34 pm 97
Thanks Paul. I assume this is two days of sales due to the holiday?
19K Party this week.
PS – #89 – I see some child is using my handle again.
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October 9th, 2012 at 6:39 pm 98
Here is Oct 2011:
Here is 2010:
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October 9th, 2012 at 6:41 pm 99
Test. I finally decided to get an avatar.
Hot debate. What do you think?
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October 9th, 2012 at 7:29 pm 100
@Chem guy:
‘Published vacancy rates are BS’
Vacancy rates measure the number of units that are both vacant and currently on the rental market so they exclude vacant units held by an investor uninterested in renting them (speculator). They are a flawed metric but all metrics are flawed in some way or another.
All that said can anyone provide a link for the vacancy rates for Vancouver that were posted by @joe_blown_away_by_high_housing_costs? Those numbers seem too low to be true. My experience renting downtown has been that the market was really tight but I have a hard time believing that it is quite that tight. A 0.3% vacancy rate which we hit twice apparently is sheer lunacy. As was previously mentioned 4% is normal. For reference Manhattan historically runs in the 0.75%-2.0% range, Toronto runs a bit higher in the 2%-3% range. Both are considered tight rental markets so 0.3% or even the 0.7% in 2011 is too low to be believable.
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October 9th, 2012 at 7:29 pm 101
@patriotz:
micro-economics – not macro-; and you are talking about preferences and utility curves. Affordability and willingness to pay are not the same.
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October 9th, 2012 at 7:35 pm 102
@patriotz:
RE student:
There is some merit that international students take up potential seats for locals, but they are also paying full freight and then some. They are actually subsidizing local students. Without international students this puts more pressure on taxpayers. Locals pay somewhere in the range of 20% of their education.
Also, before someone inevitably does, the free model is not an answer. Alot of European schools lack credibility since they provide piss poor education given the revenue model
Hot debate. What do you think?
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October 9th, 2012 at 8:22 pm 103
Hidden due to low comment rating. Click here to see.
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October 9th, 2012 at 8:23 pm 104
While I do agree that the high tuitions paid by international students do subsidize local post-secondary institutions, this has to be weighed against (at least) a couple of other factors. These include the exclusion of qualified local applicants from those schools based on what amount to quotas, as well as the exclusion of “locals” from those areas in relative proximity to the schools which might command higher rents. More importantly in my mind is the exemption from capital controls involving foreign students in Canada; to put it briefly, students are allowed to bring in essentially unlimited sums of unregulated money as long as it is being used for “education related expenses.” This has been exploited extensively as a mechanism to pump money into our local (BPOE) offshore land-bank for some of the world’s wealthy elite. By no means the whole story, but all pieces of the same puzzle.
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October 9th, 2012 at 8:26 pm 105
Hi,
I’ve been looking for a SFH for the past three months (young/growing family), and have been figuring that I could drive a hard deal. While I’ve had a few sellers drop 20% or so and come near my bids, I’ve been kyboshed to date (I’m generally bidding about 70% of the asking price, which I figure is around 10-15% below where current sales are taking place).
I’ve come across numerous folks (developers/etc.) who are straining under a heavy load of RE debt, but as of now I still have not been able to close a deal.
So, I’ve made a decision. I’m going to go back to each of the three places I bid on in September in a few weeks and bid on them again. 5% below my prior bid.
Wish me luck!!!!
This market is going to crack hard, I might be too early on the trigger?
Any thoughts are appreciated.
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October 9th, 2012 at 8:33 pm 106
@fatso:
Hey Fatso, read what Morris wrote. She/He didn’t say its the same. She/He said you need both. You look confused.
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October 9th, 2012 at 8:33 pm 107
@VHB:
hey VHB. Thanks for the 2010/2011 stats. I am putting them into an image for everyone. However, can you confirm the stats from 2010? It appears Oct 11th, 2010 was thanksgiving, but you have it listed as Oct 17th. Did the stats get shifted? Not sure how to correct it. Can you confirm? Thanks.
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October 9th, 2012 at 8:34 pm 108
Hidden due to low comment rating. Click here to see.
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October 9th, 2012 at 8:40 pm 109
@I_LOVE_ING:
“All that said can anyone provide a link for the vacancy rates for Vancouver that were posted by @joe_blown_away_by_high_housing_costs? Those numbers seem too low to be true.”
The numbers I provided were from the CMHC Housing Market Information series Rental Market Report — Vancouver and Abbotsford CMAs. The only ones currently available on the CMHC website are from 2011 and 2010. The older data is from back issues that I have downloaded on my computer.
The link for the 2011 issue:
http://www.cmhc-schl.gc.ca/odpub/esub/64467/64467_2011_A01.pdf?fr=1349839797645
From page 16, Table 1.1.1 Private Apartment Vacancy Rates (%) by Zone and Bedroom Type Vancouver CMA
12 lines down in the table:
City of Vancouver (Zones 1-10):
Bachelor Oct-10: 1.2 Oct-11: 0.6
1 Bedroom Oct-10:1.3 Oct-11: 0.7
2 Bedroom Oct-10: 1.2 Oct-11: 0.8
3 Bedroom Oct-10: 1.1 Oct-11: 2.2
Total Oct-10: 1.3 Oct-11: 0.7
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October 9th, 2012 at 8:44 pm 110
Think I figured it out. Just needed to shift that week down 1 day. Okay, here is the updated sales chart for October!
http://i46.tinypic.com/1gigi.gif
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October 9th, 2012 at 8:46 pm 111
I wish CMHC kept an archives of these reports. This is from the 2007 report, same table:
City of Vancouver (Zones 1-10)
Bachelor Oct-06: 0.3 Oct-07: 0.4
1 Bedroom: Oct-06: 0.3 Oct-07: 0.4
2 Bedroom: Oct-06: 0.4 Oct-07: 0.7
3 Bedroom: Oct-06: 0.0 Oct-07: 0.5
Total: Oct-06: 0.3 Oct-07: 0.5
Note that the vacancy rate for 3 bedrooms in City of Vancouver reached 0.0% in October 2006!!!
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October 9th, 2012 at 8:49 pm 112
@joe_blown_away_by_high_housing_costs
Thankss. It looks like a pretty solid report and the values for Abbotsford make perfect sense so I’m forced to accept the results but I stand by my statement that the numbers downtown are sheer lunacy.
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October 9th, 2012 at 8:51 pm 113
Okay, here is a link to the Fall 2008 CMHC Rental Market Report Vancouver and Abbotsford CMAs showing vacancy rate in City of Vancouver hit 0.3%!!!
http://www.goodmanreport.com/content/2008%20CMHC.pdf
Go to page 15 of the report, table 1.1.1, 12 lines down:
City of Vancouver (Zones 1-10):
Bachelor Oct-07: 0.4 Oct-08: 0.4
1 Bedroom: Oct-07: 0.4 Oct-08: 0.3
2 Bedroom: Oct-07: 0.7 Oct-08: 0.3
3 Bedroom: Oct-07: 2.3 Oct-08: 0.8
Total: Oct-07: 0.5 Oct-08: 0.3
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October 9th, 2012 at 8:52 pm 114
@joe_blown_away_by_high_housing_costs
‘Note that the vacancy rate for 3 bedrooms in City of Vancouver reached 0.0% in October 2006!!!’
Sheer lunacy. I’ve never been in the market for a 3 bed but my experience looking for a decent sized 2 bed downtown was really negative.
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October 9th, 2012 at 8:52 pm 115
So far every single day this October has been worse than the equivalent day in October 2011 for sales. As the chart shows, the first 6 days of sales (2012 vs 2011) are:
92 – 128
135 – 145
90 – 120
67 – 97
73 – 94
119 – 159
Nothing to celebrate here. Another huge MoM sales drop coming for October 2012
Chart: http://i46.tinypic.com/1gigi.gif
Hot debate. What do you think?
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October 9th, 2012 at 8:57 pm 116
Hi Looking Now: I definitely think you’re pulling the trigger way too early. My personal feeling is that the “discount” you get now will double or triple (or more) in the next year or two or three.
I’m no economist, and I don’t pour over numbers like some of the seriously dedicated souls here. I’m just a guy who sold his house two years ago in favor of renting while the bubble played out. I’ve since spent a lot of time researching and looking at the factors that created this fat, greedy blob we call a bubble. Today, I truly believe that getting out when I did was one of the best moves I’ve ever made.
You can buy today at a small discount, but you’ll very likely sit there for months and years as your new home devalues much, much further.
I don’t say this to be a smart-ass, but can you *honestly* live with that?
Well-loved. Like or Dislike:
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October 9th, 2012 at 8:58 pm 117
From the 2008 CMHC Rental Market Report:
http://www.goodmanreport.com/content/2008%20CMHC.pdf
“Rental Apartment
Vacancy Rate Approaches
20-Year Low
Following two years of vacancies
below one per cent, the vacancy
rate moved lower still in 2008.
The average rental apartment
vacancy rate dipped to 0.5 per
cent, from 0.7 per cent last year.
Rental apartment vacancy rates at
or below one per cent were
recorded for many communities in
the CMA. The lowest apartment
vacancy rates were in North
Vancouver (0.2 per cent) and the
City of Vancouver (0.3 per cent).
Vacancy rates were higher in
suburban and Fraser Valley centres
further away from the metropolitan
core.
Low apartment vacancy rates
reflect solid demand for rental
housing and a shrinking stock of
purpose-built rental units. New
rental construction in the
Vancouver CMA has been low for
many years, with builders focusing
on apartment condominium
construction rather than new
rental projects. Just three per cent
of all new home starts in the past
year were rental starts. High land
and building costs, and strong
demand for apartment
condominiums over the past few
years have made building for the
homeownership market more
attractive than building rental
projects. Less than 300 new rental
apartment units were completed in
the first ten months of 2008.
Overall, the stock of purpose built
rental apartments declined by
more than 1,000 units over the
past year. Some rental buildings
may have been converted to
condominiums, while others have
been temporarily taken out of the
rental pool as they undergo
renovations and repairs.
Vancouver City and New
Westminster recorded the largest
declines in the number of rental
units.”
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October 9th, 2012 at 9:12 pm 118
@100 looking now, what has the reaction been like? I’m in a similar situation as you. What areas are you looking at?
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October 9th, 2012 at 9:18 pm 119
“Overall, the stock of purpose built
rental apartments declined by
more than 1,000 units over the
past year. Some rental buildings
may have been converted to
condominiums, while others have
been temporarily taken out of the
rental pool as they undergo
renovations and repairs.”
-224 units taken out of the rental pool alone at Little Mountain from 2007-2009 due to misguided government policy of redevelopment and privatization.
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October 9th, 2012 at 9:24 pm 120
Cmhc rental statistics are completely meaningless, most large property management companies decline to participate in their phone survey.
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October 9th, 2012 at 9:42 pm 121
@Bob123
‘Cmhc rental statistics are completely meaningless, most large property management companies decline to participate in their phone survey.’
That doesn’t make sense. Why would the vacancy rate in certain buildings be one level and a different building in the same city be wildly different. You would expect that the levels be nearly the same. If they weren’t the rents would shift to bring the overall profitability of the buildings into line which would cause the vacancy rates to be similar.
Also comparing Vancouver to Toronto or Abbotsford should be valid as the same methods are used to collect the data.
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October 9th, 2012 at 10:03 pm 122
The vacancy rat for apartments doesn’t include stratified buildings. Just purpose built rentals p we 4 units. So vacancy rates in condos (stratified ownership) won’t show up in the numbers.
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October 9th, 2012 at 10:06 pm 123
Page 2 explains what is excluded from the vacancy rates:
http://www.metrovancouver.org/planning/development/housingdiversity/MunicipalProfiles/northvancouvercity15may2012.pdf
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October 9th, 2012 at 10:08 pm 124
@Rememberingsatv
It is a percentage so it doesn’t have to include the entire population to be accurate. As long as the sample is large enough it is accurate.
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October 9th, 2012 at 10:23 pm 125
@Looking Now: What city/area are you looking at?
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October 9th, 2012 at 10:27 pm 126
@Rememberingsatv Says:
“The vacancy rat for apartments doesn’t include stratified buildings. Just purpose built rentals p we 4 units. So vacancy rates in condos (stratified ownership) won’t show up in the numbers.”
That is true for the numbers I have been quoting. But the CMHC Rental Market Reports do provide some statistics on rentals in condo buildings. This is from the 2010 report:
“While the purpose-built rental market reported lower vacancy rates, the secondary rental maket moved in the opposite direction, reporting higher vacancy rates. The vacancy rate for investor-owned rental condominiums increased to 2.2 per cent in October 2010 from 1.7 per cent in October 2009, mainly due to the addition of more than 3,500 rental condo units to the supply. Nearly one-quarter of the apartment condominium stock is rented out by investors, a slight increase compared to last year. With less than five per cent of all new residential construction so far this year being purpose-built market rental apartments, investor-owned condominiums are an important addition to the supply of rental housing. More than half of renters in the Vancouver CMA live in secondary rental units, including investor-owned condo apartments, single family homes, town homes and accessory suites.” (pp. 2-3)
http://www.cmhc-schl.gc.ca/odpub/esub/64467/64467_2010_A01.pdf?fr=1349846027843
Among investor-owned condo units 2.2% vacancy rate in Oct 2010 and 1.7% vacancy rate in October 2011. This is higher than the vacancy rate for purpose built rentals but still nowhere near the 4% level considered healthy. Also, these units may be transfered out of the rental pool very easily if the owner decides to sell the unit.
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October 9th, 2012 at 10:41 pm 127
Very Interesting article from Globe and Mail:
Global outlook turns darker.
The rest of the world is ratcheting up already intense pressure on Washington and Brussels to head off another global economic crisis, as the outlook grows ever dimmer.
The gravest threats to the increasingly fragile recovery lie in a divided United States and a wounded euro zone, according to the growing chorus of voices that are urging governments to act quickly and decisively to deal with crippling debt and fiscal problems.
http://www.theglobeandmail.com/report-on-business/economy/global-outlook-turns-darker/article4599991/
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October 9th, 2012 at 10:54 pm 128
@I_LOVE_ING:
The claim in your second sentence is simply false. If the sample is biased, it doesn’t matter how large it is, it will not give a valid result. Here’s a thought experiment: Assume you wanted to estimate the incidence of HIV (per 1000 population) in Vancouver (proper). Assume further that you hired an enterprising young survey technician who, working prodigiously over the course of a year, was able to survey 600,000 Vancouverites. If you were I_LOVE_ING, you’d be pleased since that is an exceptionally large sample (more than 90% of Vancouver’s population)!!
I, on the other hand, after poring through the individual surveys, became very troubled when I realized that not a single resident of the downtown East Side was interviewed. I didn’t know that our survey technician feared walking there on his own nad decided that it would be fine to not do any interviewing in the DES as long as he made up for it by interviewing every other Vancouverite. After all, he thinks to himself, my mentor–I_LOVE_ING–convinced me that the larger the sample the better. The results of this survey, as you may have already discerned, as useless as they are biased.
I was able to genenate a more accurate estimate of the incidence of HIV in Vancouver by surveying only 2,000 respondents. Why? Because my sampling frame including everybody living in Vancouver. That is, each resident theoretically had a non-zero chance of being in my survey. The same can not be said for the other hypothetical survey.
As it relates to the CHMC vacancy report, if some types of rental accommodation do not have the same probability of being included in the survey, the results are biased and should not be generalized to this type of accommodation.
Hot debate. What do you think?
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October 9th, 2012 at 11:29 pm 129
May be we should decide on an open house every sunday, and all go there to low ball at -40%.
Since none of us know each other, it is going to be even more fun.
MLS®: V967434 looks like a nice first candidate: super overpriced and easy to access by transit.
For Sale: $878,000
Row / Townhouse
Floor Space : 1421 sqft
Title : Condominium/Strata
Location : 186 W 16TH AV
Vancouver, BC V5Y 1Y7
Open Houses this Saturday & Sunday Oct. 13th & 14th 2pm-4pm both days.
I will go.
Hot debate. What do you think?
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October 10th, 2012 at 4:20 am 130
@zambu:
“micro-economics – not macro”
Correct, my snooze.
But as far as the market is concerned you either buy or you don’t. People decide to spend their money on a basket of things and you can’t say that they can afford X and can’t afford Y. Of course if they are consuming more than their income, i.e. living beyond their means, they can’t afford their consumption in aggregate.
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October 10th, 2012 at 4:25 am 131
@oneangryslav2:
Hey give the guy a break, Tony Clement said it’s true and who you gonna believe?
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