Cambie-fornia, Compare and despair.

Remember when a million dollars was real money?

It’s always fun to compare what your Vancouver home dollars will get you in less fortunate countries.

A commenter by the name of mortgage posted this delightful contrast.

Here’s what $2.5 million will get you on a major street in the Cambie corridor, walking distance from the world famous ‘Oakridge Center Mall’.  This 1948 beauty is located near the vibrant heart of Vancouver, where the sun always shines:

Somewhat south of there is a place called Beverly Hills California.  If you take your $2.5 million down there you’ll find something like Dudley Moores old digs:

..but you wouldn’t be walking distance to Oakridge Mall.  They have a Zellers.

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Guy Smiley
Member
Guy Smiley
4 years 14 days ago
Lapre!! Lapre!! Lapre!! Where are you buddy, i haven’t logged in to see your morning greetings for awhile now. Sleeping in?? I just finished reading yesterdays posts and had some thoughts regarding the furnished apts. Any tax lawyers on the forum available to tell me if this is a remote possibility? If those properties were owned by people who only used them occasionally and who also happened to be in a high earnings bracket, could they not be put into a rental pool and rack up losses all the time they sit empty? They don’t acutally want anyone to stay… Read more »
VMD
Member
4 years 14 days ago
New guidelines coming for mortgage insurers – another round of tightening in a few months. We haven’t even observed the full impact of 2012 CMHC/OSFI rule changes yet! Looks like someone up top is antsy to … un-embiggen the bubble balloon. Nov. 19 2012 “Canada’s financial regulator will release new guidelines for mortgage insurers early next year, including the government’s CMHC. – but they won’t drag down the housing market as much as the guidelines for banks have, says the country’s banking watchdog… ..Mr. Flaherty moved to put CMHC, which dominates the mortgage insurance business in Canada, under OSFI’s authority… Read more »
G
Guest
G
4 years 14 days ago

“but you wouldn’t be walking distance to Oakridge Mall. They have a Zellers.”

I am also not happy with Van RE’s sky high prices, but the person who wrote this comment just sound like a loser.

Naked Official #9000
Guest
Naked Official #9000
4 years 14 days ago

@G:

You’re not exactly a ray of sunshine, either.

gordholio
Member
4 years 14 days ago
Guys/gals: Ever heard of a place called 17 Mile Drive? I was there last year (in January – to interrupt the never-ending BPOE grey/rain). It winds through the southerly portion of the Monterey Peninsula, adjoining hoity-toity haunts like Carmel and the Pebble Beach Golf Course. A stunning little road that hugs Pebble Beach and takes you right down to one of the most beautiful coastlines you’ll ever see. Windswept trees, massive rock outcroppings, super-soft sandy beaches, pelicans, sunshine, etc, etc. (They charge you something like $10 just to *drive* it.) Anywho, there are private homes all along this rarified road,… Read more »
patriotz
Member
4 years 14 days ago

Flaherty’s rule changes will bite hard: mortgage brokers

The country’s mortgage brokers are taking aim at Jim Flaherty.

The Finance Minister’s moves to slow down Canada’s housing market have gone too far and are putting the economy at risk, the national mortgage brokers’ association argues in a report to be released Monday.

The economy is at risk all right – the fake economy based on ever-increasing consumer debt which these people have been pushing. That’s what’s gone too far. Sure didn’t hear these jokers complaining when Jimbo fuelled the ride up in 2006.

Just leave the keys to the Bimmer on the counter guys.

Anonymous
Guest
Anonymous
4 years 14 days ago
Last week in The Daily Beast: “Vancouver has been a popular destination for Chinese, driven in large part by its proximity to China and its spectacular feng shui,” notes Jamie MacDougal of Sotheby’s International Realty…But MacDougal notes that Chinese offshore buyers arriving in Vancouver spiked to truly unsustainable levels in 2011, during which bidding wars were regular events and property values rose by the week… The current market, notes MacDougal, has changed from one in which Chinese speculators were trading among themselves to one in which the market is “flooded with inventory” and “mainly Chinese sellers” are responsible for the… Read more »
Makaya
Member
Makaya
4 years 13 days ago
From Mish’s blog: How Sustainable are China’s Copper, Cotton, Steel Imports? What About Chinese Purchases of Canadian and Australian Real Estate? Fresh Thinking on Balance of Payments What About Canadian and Australian Real Estate? Pettis states “The demand for real estate may or may not abate at some point in the future, given the size of Chinese demand to hold assets in a safe place – a demand which is not likely to drop with slower Chinese growth but rather to speed up.” Demand to get money out of China will likely speed up. However, and in a rare (albeit… Read more »
MM
Guest
MM
4 years 13 days ago
@Makaya “I suggest demand for real estate is likely to plunge once real estate investment is no longer consider a safe haven.” I am not a RE bull, but I have something to add. What if Chinese rich people who are attempting to launder ill-gotten money out of China and park their money in Van RE view RE losses as the cost of laundering money? Let’s say Van RE goes down 50% in price. That means the Chinese investors still have the other 50% of their capital–that may be more than what they would have if they left their money… Read more »
MM
Guest
MM
4 years 13 days ago

Correction to previous post:

“I don’t think your disagreement with Pettis is “slight” at all. This is a very significant disagreement.”

It was Mish saying they had a slight disagreement with Pettis, not Makaya. I misread where the quote from Mish’s blog ended. Sorry.

MM
Guest
MM
4 years 13 days ago
A quote from Pettis on Mish’s blog post linked to by Makaya: “My point more generally is that growth in China is likely to be negatively correlated with Chinese demand for foreign real estate and positively correlated with Chinese demand for commodities.” Stated differently, negative growth (ie. recession) or perhaps even just slowing rate of growth in China is **POSITIVELY** correlated with Chinese demand for foreign real estate and **NEGATIVELY** correlated with Chinese demand for commodities. **IF** these correlations are true and **IF** the Chinese economy is in for a rough patch, then this argument is a BULLISH argument for… Read more »
painted turtle
Guest
painted turtle
4 years 13 days ago
@Makayana For once, I disagree with you. Those investors have the choice to invest in many other countries and the US is trying hard to attract them. Why buy an asset that is falling in value? They became attracted to Vancouver RE after the Olympic media buzz. 10% appreciation of an expensive home, good schools, trendy destination, Mom could come over with the kids and make $100,000 by just staying home. I bet in the last 18 months they discovered high taxes, high prices for everything, continuous rain (2011 was a great one!), traffic congestion. The world class city, aka… Read more »
painted turtle
Guest
painted turtle
4 years 13 days ago

Sorry , I meant ‘disagree with MM’, not Makaya…
I should drink my breakfast before typing…

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
4 years 13 days ago

@Makaya:

What’s there to comment on? Pettis and Shedlock are in disagreement. But of course bear logic causes you to be blind to the facts that don’t support your position.

Australia real estate isn’t “toast”. It’s up on an annual basis.

Once the leadership hand over has settled in Beijing the flood gates will open again. Be prepared to get priced out again.

I saw a mainland china tour bus checking out the Olympic oval and the river green development this weekend.

painted turtle
Guest
painted turtle
4 years 13 days ago

@ Bull Bull Bull:

I hope they enjoyed the weather!

MM
Guest
MM
4 years 13 days ago
@Painted Turtle: I hope you are right! I really detest Chinese investment in Vancouver real estate driving up prices and pushing out locals. The argument I laid out that you are disagreeing with is not an argument I am married to. I was just getting my argument from the quotes by Pettis in the Mish article that Makaya posted. I don’t know which argument is right, Pettis or Mish. Both arguments seem logical to me. It is interesting to point out though that your argument about why the Chinese may be turned off Vancouver real estate is all about individual… Read more »
Potomac
Guest
Potomac
4 years 13 days ago

Why would Chinese invest and move to US or anywhere else but Vancouver? They have dim sum restaurants here, their paper, TV, radios, their elected officials, even houses are built with Chinese kitchens. even ATM machines are programmed in Mandarin. Why would you move somewhere else ?

Anonymous
Guest
Anonymous
4 years 13 days ago

I know, it’s great fun, and so easy, to find ridiculously overpriced old bungalows in Vancovuer and compare to the fancy mansions you get for the same money somewhere else. But, to be fair, look at what else you can get for 2.5 millions in and around Vancouver:

http://www.realtor.ca/propertyDetails.aspx?propertyId=12479913&PidKey=211628913

http://www.realtor.ca/propertyDetails.aspx?propertyId=12124001&PidKey=898338562 (a leasehold, I know, but darn nice)

http://www.realtor.ca/propertyDetails.aspx?propertyId=12588105&PidKey=904102069

jesse
Member
4 years 13 days ago
@MM: So before we get into the “Chinese will favour real estate assets over anything else” maybe we can take a step back and ask a few things: 1) Is real estate still seen as a safe investment in the long run when prices are seen to be falling at (say) 5% per year? 2) Are there times in history when certain Asian economies known for propensity for real estate investment (say Hong Kong) have turned sour? 3) Why would an offshore bank account with government securities be any less safe than a real estate deed whose funds are traceable?… Read more »
Anonymous
Guest
Anonymous
4 years 13 days ago
@MM: “What if Chinese rich people who are attempting to launder ill-gotten money out of China and park their money in Van RE view RE losses as the cost of laundering money?” You need to look up the definition of money laundering. Buying real estate does not launder money in any way, shape or form. If they are looking for a ‘safe haven’ why not just put the money in a Canadian bank or even better a Swiss bank account? Much more liquid. Real estate can be easily confiscated and all transactions are public record. It is not a good… Read more »
jesse
Member
4 years 13 days ago
@MM: Also on Canada as a “safe haven” for foreign wealth, consider some of the actions undertaken in the past year or so by our much-hated governments: – Hold on investor immigrant applications – Requirement to declare income for mortgage qualification – Kenney complaining about provincial nominee program loopholes – BC suspending “suspicious” provincial nomination applications – Quebec getting severe pressure to curtail its nominee loopholes – No interim HST rebate for houses $1mm+ – Removal of MI for $1mm+ homes – Rejecting residency applications, apparently mostly to middle-eastern immigrants Not that these have quenched the flow of foreign capital… Read more »
Devore
Member
Devore
4 years 13 days ago
This seems to rest on the premise that wealthy Chinese favour real estate over everything else, even when it is falling in value. Will they double down, or will they fold? Why wouldn’t they redeploy their money to safe heaven banks (Swiss, Cayman, etc), or into western government bonds, which are not losing value, are not costing them 1000s of dollars every year, and where foreign immigration and tax authorities aren’t hassling them constantly? By all indications, the really wealthy aren’t very keen on leaving China, it is only the upstart “middle class” of unconnected and uncorrupt, who are of… Read more »
Anonymous
Guest
Anonymous
4 years 13 days ago

this is comparable for sure. unlike stupid bears compared the best place on earth VANcouver to NY and NJ. Looked what those cities have became after the superSandy arrived! dont just poke your own arses, bears .

Many Franks
Guest
Many Franks
4 years 13 days ago
Here’s a quick Rob Carrick interview about how the new regulations will behave with dropping values. There are some stats thrown around at the outset, including: “Only 4% of Canadians have less than 5% equity in their houses.” That’s a weird stat. I suspect he means Canadian households, and it’s not clear whether he’s including renters instead of just mortgage-holding households, which would of course make the proportion of high-LTV mortgages sound lower than it actually is. (That’ll teach me for trying to get useful stats out of a face-to-face interview, but the guy really could’ve tried harder to make… Read more »
Ok, But
Guest
Ok, But
4 years 13 days ago

Yeah, Vancouver is over priced. But Cambie street was re-zoned as high density so these houses will soon be torn down and replaced with sky boxes that fetch 300-400k each. So the comparison is not valid.

Has this blog turned into what it hates most? Mindless droning of one side of the story?

It seems that rational discussion here is becoming more and more rare. This place is turning into an echo chamber for bears.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
4 years 13 days ago
@Potomac: because Canada is soft on white collar crime, money laundering, and tax cheats. and the chinese communist party is the biggest organized crime group in the world. that’s why domestic and international organized crime always find a home here. it’s an easy bet. if you think that canadians are incapable of changing their fundamental nature of being pussies buy a house and ride the red wave. look at canada’s history. even this countries greatest military victories were not for it’s self, but for it’s conolial masters. this is a country of pussies. that’s reality. sorry if it hurts. but… Read more »
Vote Down The Facts
Guest
Vote Down The Facts
4 years 13 days ago

@Many Franks: “That’s a weird stat. I suspect he means Canadian households”

Complicated even further by the fact that not every household has a mortgage (some have clear title). Here’s a link to some more stats :

http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2012/06/caamps-spring-mortgage-report-2012.html

They say: ‘Homeowners with less than 10% equity: 5% (Among homeowners with mortgages, the number is 9%. This can change quickly, of course, depending on home price movements.)’

jesse
Member
4 years 13 days ago
@Ok, But: “It seems that rational discussion here is becoming more and more rare. “ You mean how many of those Cambie lots were bought at prices well above what can be recouped after the City charges CAC? I agree the comparison isn’t fair because of redevelopment potential but the other side is how dumb some of the recent purchasers of these properties were. Developers were LOLing at the prices they were paying and even former planning poobah Toderian stated he thought the purchases were ill-advised. If anything the focus on Cambie should be on how “dumb money” is, as… Read more »
Anonymous
Guest
Anonymous
4 years 13 days ago

@Anonymous: ….Buying real estate does not launder money in any way, shape or form….

Small scale development can.

painted turtle
Guest
painted turtle
4 years 13 days ago

Cambie corridor: Not much sale activity there lately… Houses for sale sitting for many months…

Ted
Guest
Ted
4 years 13 days ago
@Potomac: Have you traveled much? You could get the same thing in a lot of American cities. Definitely LA, Bay Area, Seattle even. Theres “hot chinese money” everywhere, not just Vancouver. The only difference is in Vancouver, a larger amount of sheep bought into the notion of Buy Now or Be Priced Out Forever. There’s a gambler mentality and culture here. Remember this is where the VSE was, and still a hotbed for scams, stock fraud, drug production, and yes HAM. Point is that, its not just HAM. People of all races, have bought into real estate, as a game.… Read more »
All quiet on Snob Hill
Guest
All quiet on Snob Hill
4 years 13 days ago

Dunno what all the fuss is about wealthy Chinese driving up property values. That was a year and a half ago. They’re now pulling out in droves.

Just take a look at all the “for sale” signs in the British Properties which probably has a higher percentage of Chinese than Richmond.

spit
Guest
spit
4 years 13 days ago
@MM: “What if Chinese rich people who are attempting to launder ill-gotten money out of China and park their money in Van RE view RE losses as the cost of laundering money?” This is probably a very accurate assessment, and losing some money as the “cost of doing business” is exactly the thinking behind one of the most common money laundering schemes here in BC. Drug dealers here in BC have people to go to local casinos with to gamble the drug proceeds and turn illegal drug money into legit cash. Here’s how: – drug dealer has $10,000 brought to… Read more »
jesse
Member
4 years 13 days ago

CBC: Credit reporting errors costing Canadians

Credit rating mistakes are costing unsuspecting consumers thousands of dollars in higher interest rates and preventing some from getting much needed loans, a CBC News investigation has found.

In the past few years, more than 500 complaints have been filed with provincial consumer affairs agencies across Canada about credit reporting agencies, many alleging errors by companies led to their poor credit scores.

Canadians are being shafted from taking out even more credit than they already are? Scandalous. Top of the agenda for the finance standing committee meeting.

Patiently Waiting
Member
Patiently Waiting
4 years 13 days ago

The problems with getting legitimate businesspeople to come here, as we see from the suspension of Visas, speaks to the our economic problems. There isn’t much real opportunity here. Vancouver is on the decline and in a region that is getting the money sucked out of it by multinationals. Once HAM comes to terms with the BC’s lack of an economic future, they will have their kids begin their careers elsewhere.

VancouverGuy
Guest
VancouverGuy
4 years 13 days ago

The article doesn’t mention that the Cambie Corridor will mostly be re-zoned for high-density residential developments up to six stories and these prices are for the land-value. It’s definitely a windfall for all the lucky owners, as their houses probably doubled or tripled in value in a matter of a few months.

patriotz
Member
4 years 13 days ago
@Many Franks: ““Only 4% of Canadians have less than 5% equity in their houses.” That is a large number considering: 1. The 0/40 was eliminated long enough ago that those who bought with it would have paid off 5% of their principal by now. 2. The only part of Canada which has seen a sustained decline over the last few years is BC outside of Vancouver and Victoria. Alberta is still down from the 2007 peak but the rise and fall (and partial bounce) were rapid enough that not many buyers would be down >5% from what they bought for.… Read more »
patriotz
Member
4 years 13 days ago

@All quiet on Snob Hill:
“Just take a look at all the “for sale” signs in the British Properties which probably has a higher percentage of Chinese than Richmond.”

How do you know it’s the Chinese who are selling. Maybe it’s old white folks who think they can sell to Chinese buyers who aren’t there.

Same effect on the market though.

Apocarypse Mao
Guest
Apocarypse Mao
4 years 13 days ago

More Chinese in BP than Rmd? Nope.

http://www.vancouversun.com/Vancouver+maps+ethnic+makeup+Metro+Vancouver+interactive/5553001/story.html

Why say “probably”, info is available on line quickly.

spit
Guest
spit
4 years 13 days ago
@jesse: “1) Is real estate still seen as a safe investment in the long run when prices are seen to be falling at (say) 5% per year? 2) Are there times in history when certain Asian economies known for propensity for real estate investment (say Hong Kong) have turned sour? 3) Why would an offshore bank account with government securities be any less safe than a real estate deed whose funds are traceable?” Good questions, however if you look at this from a diversification/getting money out of China point of view, that answers your first 3 questions. And we are… Read more »
metalhead
Member
metalhead
4 years 13 days ago

I’m looking for a house in Denver right now, around 650 to 700K price range.
For shits and giggles type that range into this web site.

http://www.denverrealestate.com/

It will make a Vancouver house hunter spew.
If you really want to see some crazy stuff, type in a million dollars.
The houses actually look like you would think a million dollar home would look like, not like crack shacks, lol.

HAM Solo
Guest
HAM Solo
4 years 13 days ago
@ Franks I think one of the best-kept secrets of the housing bust is the under-reporting of insolvency of marginal home-owners. The house finance industry needs to report that there is a solid equity cushion “on average” in order to continue to write new mortgages where the is very little in the way of equity. The low reported percentage of low-equity / negative-equity homeowners is skewed by the following factors: a) Over-estimation of the value of homes at the time of purchase. Every multiple offer westside home sale of the spring 2011 was deemed to have been made at least… Read more »
Anonymous
Guest
Anonymous
4 years 13 days ago

@metalhead: ….It will make a Vancouver house hunter spew….

Come on! Look a the great weather Vancouver has compared to Denver(try to do that without spewing).

jesse
Member
4 years 13 days ago
@spit: ” however if you look at this from a diversification/getting money out of China point of view, that answers your first 3 questions” The articles you cite provide no evidence to support a continuous flow of capital out of the country, rather they include some large numbers and you are using this as evidence how the outflow of money cannot abate. I see no relationship there. “Don’t really see the point/relevance of your 4th question when dealing with the uber rich” We have had several examples in Asia over the past several decades of significant slowdowns in economic output.… Read more »
metalhead
Member
metalhead
4 years 13 days ago

LOL, good one Anonymous.

Denver does no thave Southern Cal. weather but it does average 300 days a year of sunshine.

btw, this is one I’m thinking about. Need to find out more about the HOA first.

http://www.denverrealestate.com/property/17068949/1686-SOUTH-WILLOW-CT-Denver-CO-80231

it’s amansion compared to anything in the lower mainland for 700K.

All quiet on Snob Hill
Guest
All quiet on Snob Hill
4 years 13 days ago
Thanks for the map Apocrap. I stand corrected. Couldn’t help noticing that the map shows Richmond broken up into many small pockets of different colors whereas the BP area covers everything from the Cap river to Chairlift Road. Most of the Chinese population in the BPs is concentrated in the newer Chartwell/Canterbury/Whitby areas, and the older established area to the east not so much. Patriotz could be right that the sellers might be old white folks. Could be a combo of both, but it seems to me that the FS signs are the heaviest in the Chartwell area and west.… Read more »
Cambie misprint?
Guest
Cambie misprint?
4 years 13 days ago

Hold on now guys.
Do you think it might be remotely possible that the price of the Cambie place could be a misprint and was intended to be $1,548,000?
although even that sounds too high, but at least believable.

patriotz
Member
4 years 13 days ago

@HAM Solo:
Consumer debt outside the mortgage isn’t relevant to equity on a property because the lender’s lien trumps it. Equity represents the lender’s cushion against price declines. It’s not the same as the borrower’s net worth.

I agree that the net worth situation is a lot worse then what you’d get just looking at RE equity.

patriotz
Member
4 years 13 days ago

Interesting discussion on the RE market on Beauty and the Beast, CBC 6:48pm local time.

Amanda and the talking head describe a situation that looks a lot like the US in 2006 but avoid using the “B” word.

BLISTINGAGENT
Guest
BLISTINGAGENT
4 years 13 days ago
A couple of interesting Renniestats in this Globe&Mail article: http://www.theglobeandmail.com/life/home-and-garden/real-estate/slow-market-but-some-vancouver-condo-projects-still-selling-quickly/article5417301/ Rennie Marketing registered 7,500 potential buyers before the sales launch, and he says the majority were under 28 years old. He believes it is the young demographic that is fuelling the sales of projects like the two he’s selling at Marine and Cambie. … We really did the research on the first-time buyer when we did Marine Gateway across the street, and 28 per cent of our buyers answered in an exit survey that they were receiving down payments from mom and dad, and grandparents. … The second- or third-generation… Read more »
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