Soft Landing Achieved!
Good news! Despite all the fearmongering, gloom and forecasts of dismay for the Canadian housing market we can now happily report that our market has achieved what the US housing bubble could not – A SOFT LANDING!
“Despite the klieg-light focus on the Canadian housing market this year, its performance has been far from exciting,” said Mr. Porter.
“It increasingly looks like most major markets are indeed undergoing a policy-induced correction. But, for now, the landing looks to be soft in most cities (with some cities actually still lifting off), with the rather obvious exception of Vancouver.”
As Mr. Porter added in an interview, “I don’t think you can call what’s going on in Vancouver a soft landing anymore.”
.. A bumpy landing then?
Read the full article over at the Globe and Mail.
December 18th, 2012 at 5:31 am 1
“It increasingly looks like most major markets are indeed undergoing a policy-induced correction.”
Well Mr. Porter is right in a roundabout way, since corrections are the result of bubbles, and the bubble was induced by government policy.
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December 18th, 2012 at 5:40 am 2
Realtors blame Flaherty as slump deepens
My previous comment works for this story too.
Hot debate. What do you think?
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December 18th, 2012 at 6:45 am 3
I wonder how any reputable economist can bring out the soft landing theory, when in the history of mankind, there has never been a soft landing after a boom, ever? Wikipedia tells me so. It just boggles my mind that anybody can put this forth as a realistic scenario when apparently, it has never happened! Oh, but I guess Canada is different.
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December 18th, 2012 at 7:09 am 4
“I wonder how any reputable economist can bring out the soft landing theory”
Do any of these people have an objective definition of “soft landing”? If not, it’s not even a theory.
Hot debate. What do you think?
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December 18th, 2012 at 7:43 am 5
Perhaps this soft landing is akin to Wylie Coyote going over a cliff. The bumps are him bumping against the rock face as he goes down, painful by not too bad. This of cause says nothing about what happens when he reaches the ground.
Hot debate. What do you think?
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December 18th, 2012 at 7:44 am 6
I think that this is going to be the hardest landing, biggest bubble pop in history. It seems that the economist are so scared and they have so much pressure ATM. Big bubble, huge price drop on RE coming.
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December 18th, 2012 at 8:10 am 7
Good news from Vancouver Island. CTV Victoria;
“2013 Real estate projections downgraded”
http://www.youtube.com/watch?v=9hY1mEStEYI
Hot debate. What do you think?
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December 18th, 2012 at 8:11 am 8
And Ian Watt begging renters to buy:
“The Difference Between Renting & Buying Downtown Vancouver”
http://www.youtube.com/watch?v=jLokzWNycLg
Hot debate. What do you think?
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December 18th, 2012 at 8:21 am 9
“Ms. Gulati noted that national prices would have climbed 3.2 per cent over the year if Vancouver, Toronto and Montreal were factored out.”
Now they need to factor out Montreal too.
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December 18th, 2012 at 8:37 am 10
Hmmmm, whenever a bubble pop, the first few steps look like a soft landing. Then it goes on and on and everyone figures out that when you keep losing altitude after you’re below sea level, the landing feels more like a crash.
But in markets where Price/Rents are still between 12 and 18 (it’s the case where I live), we’ll see P/R decrease to 8-10 and call that landing kinda soft.
Hot debate. What do you think?
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December 18th, 2012 at 8:41 am 11
Ian Watt. I can not believe you have made a rent v. buy computation as rediculous as that on your weekly blog. First you assumed property appreciation, you did not include selling costs, and you did not include any of the other costs of ownership. You did not even note that to rent th equivalent place, your monthly cash flow is actually not less. It does not cost 2,000 to rent a 400,000 place in DT van – more like 1,500-1,700.
Wow – I thought he was going to come up with a reason that renting was better. What was I smoking?
See you tomorrow Van . . . . . . I’m in for X-mas . .
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December 18th, 2012 at 8:57 am 12
Population growth to Q3-2012
http://housing-analysis.blogspot.ca/2012/12/bc-population-growth-to-q3-2012.html
Hot debate. What do you think?
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December 18th, 2012 at 8:59 am 13
“Vancouver, where sales plunged almost 29 per cent in November alone and MLS-measured prices have slipped 4.5 per cent…”
Can anyone tell me how they measure these “sales”? Is it the number of units or a dollar amount? Is the real volume drop 29% or 33.5% ? Either way it’s a lot less commish to go around for realtors, but what’s the real number here?
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December 18th, 2012 at 9:36 am 14
@N
If they could just factor out all those goals Luongo allowed 2 years ago, the Canucks would have won the Cup! Hey, you can use this factoring out thing for anything. Awesome!!
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December 18th, 2012 at 9:37 am 15
Ian looked a bit sheepish in that clip. I think even he knows that what he is saying is bull shit.
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December 18th, 2012 at 9:38 am 16
Hey wait a minute. They told me Real Estate never goes down. That means NO landing. Hard, soft or otherwise.
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December 18th, 2012 at 9:43 am 17
We all know Vancouver prices have been out of whack compared with the rest of the country. But what about the level of activity? Is there any reported measure or comparison of the number of transactions per capita in different markets? Does the 30% drop in activity mean we are suddenly slower than other cities or are we perhaps approaching a normal compared to the rest of Canada?
Hot debate. What do you think?
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December 18th, 2012 at 10:15 am 18
Regarding the story posted earlier: “Realtors blame Flaherty as slump deepens”
Flaherty should be credited by the RE industry for the volume of sales over the past few years. Smart agents have probably been storing away their nest eggs.
Might have to get used to it because It’s not just happening here either
Singapore tightens home loan rules
Hot debate. What do you think?
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December 18th, 2012 at 10:24 am 19
Singapore already has a price/rent exceeding Vancouver. Love those tough new measures to prevent a bubble.
Hot debate. What do you think?
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December 18th, 2012 at 10:30 am 20
This is priceless. A soft landing, just like… erm… The States! Where they had (in mid-2006):
- the majority of economists expecting prices to glide to a soft landing
- falling volumes
- decelerating prices
- cooling of the overheated markets
http://www.forbes.com/2006/08/23/home-prices-sales-cx_jh_0823homes.html
I think I’ve seen this movie before.
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December 18th, 2012 at 10:40 am 21
“…..Smart agents ….”
Oxymoron.
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December 18th, 2012 at 10:49 am 22
My definition of soft landing is when prices decrease less than 10%/year (absolute). So, 5 years of 9.99% decrease (and let’s say 2.5% inflation) and you get a soft landing into which every specuvestor has been slaughtered.
Hot debate. What do you think?
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December 18th, 2012 at 11:22 am 23
Re. #21
“”…..Smart agents ….” Oxymoron.”
PaulB?
Anonymous, desperately seeking thumbs up, but unwittingly insulting some of the VIPs of this community.
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December 18th, 2012 at 11:30 am 24
Don’t you have to land first to call it a soft landing? We are at 25,000 ft heading into Las Vegas in the summer.
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December 18th, 2012 at 12:00 pm 25
Re #21
Well actually rarely any agents are dumb. The dummies are the people who believe them and basing their buying/selling decisions from their words.
Hot debate. What do you think?
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December 18th, 2012 at 12:23 pm 26
Off topic (sort of): My sister in law has finally agreed to buy out my significant other’s share of their Whistler condo. Sadly, the sale amount is reflective of the value of the condo, which has gone down substantially over the last few years (since the Olympics). Pre-Olympics, the condo was assessed at $400k. These days, similar units are selling for $240k or so. So the amount paid out will be approximately the amount invested in the condo, 10 years ago: $25k. Oh, and that’s ten years of incurring $10k losses every year. Doesn’t matter to me, will be good to get out of this money pit-every month the mortgage must be paid (the rental revenue doesn’t cover the mortgage when you take into account the management fees, strata fees, property taxes, mortgage interest, utilities, and various expenditures required to maintain one’s spot in the rental pool-new carpets, new tv etc etc). I am happy to say, adios, money pit! (maybe I’ll offer to buy it from her when it’s assessed at 99k) (or maybe not, I still think even then it’s a poor investment). At least I haven’t heard the sister in law say to me for the past year “real estate always goes up!” and tells me I’m an idiot for not buying. Hm, I wonder who the dummy is here?
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December 18th, 2012 at 1:05 pm 27
V972084 – 3579 W. King Edward. – -
Just saying – - This is demographics at work . . In only 3 months, this larger lot on a main street was reduced and ultimately sold for more than 400K below tax value – - this is a lot value only property. I’m just sayin it but it’s an Old White Person who has owned it forever and longer. This transaction alone will move the benchmark in this slow volume month. There are more in the past few days but this is a typical example.
Soft landing? This is “Every man for himself” – run for the exits or risk having your sale price be 50% off from the peak.
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December 18th, 2012 at 1:28 pm 28
So it’s been a while since I poked around in the Whistler sales. Not too many right now after a bit of a “spike” earlier this year.
The condo sales are a disaster. In the past few days, 3 big losses on sales. Owners were West Vancouver family, Mexican couple and a random Chinese investor from Hong Kong who bought in 1995.
It’s not even worth watching any more. This is a dead market where demographics are seriously against it. Boomers need to sell to finance retirement and will sell the whislter cabin (since kids are gone anyway) before the Vancouver house, young people have no money for their own home let alone a whislter condo, HAM not into skiing generally, USA investors have made money in Whistler on currency gains and this is their best performing asset so they sell it and keep living in their various suburban USA homes, Canadian dollar is strong . . Need I say more? Whistler will continue to die a slow death as it has for the past 5 years.
More stats to come shortly. I have done some analysis on market momentum and shift by various sub-regions in REBGV. Some of the results may surprise you.
It may be past Christmas so looking forward to posting next week.
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December 18th, 2012 at 1:29 pm 29
WestJet asks Flaherty “where’s our DB pension extension(bailout)”?
http://ca.reuters.com/article/domesticNews/idCABRE8BH12Y20121218
@Patriotz asked how often do public DB pensions need a bail out?
Answer: The very next business day, apparently. Yes, artificially inflating the value of something by reducing collateral requirements is the same as a bailout.
I’d like to ask Flaherty where my bailout is too. I’d like to be able to put my wealth in a segregated bankruptcy protected account and then take CMHC backed loans to pay my rent. Then, when the loans can no longer service the debt, I want to be immune from prosecution for fraud when I declare bankruptcy and keep my segregated account.
Hot debate. What do you think?
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December 18th, 2012 at 1:35 pm 30
V974584. West Van. Wow – - – Someone else should post details on this one. What happened is anybody’s guess but it’s pretty much 40% off . . . . . .Soft landing?
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December 18th, 2012 at 1:45 pm 31
I agree 100% percent with the economists stating that Vancouver has achieved a soft landing – providing the world ends next week as planned.
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December 18th, 2012 at 1:58 pm 32
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December 18th, 2012 at 2:01 pm 33
Might want to brush up on your ‘Fedspeak’ skills pricedoutfornow
pricedoutfornow Says:
May 13th, 2009 at 1:48 pm
I heard the interview with Mark Carney last week, I also read between the lines and it seems that he’s suggesting it’s highly unlikely that they’ll be able to keep interest rates so low for as long as a year.
Hot debate. What do you think?
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December 18th, 2012 at 2:03 pm 34
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December 18th, 2012 at 2:06 pm 35
bullshitting is one thing. but patriotz bullshits with such conviction. it has to be admired. looks like you are completely wrong again patriotz.
patriotz Says:
November 25th, 2009 at 11:19 am
@Nero:
>I think at some point the CMHC will have to be reined in. My money is on them being forced to reintroduce a price ceiling.
Not going to happen as long as we have a “Conservative” minority government. It would be an admission that they had been fueling a housing bubble to try to juice the economy and gain themselves a majority. It would also induce a bust that the party in power would be blamed for.
Look for limits to be introduced after a bust, either sooner by the Liberals if they get back in (they can blame the “Conservatives” for loose lending) or later by the “Conservatives” after the bust is no longer an issue.
Hot debate. What do you think?
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December 18th, 2012 at 2:17 pm 36
Market up day … and no trolls. Just sayin’
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December 18th, 2012 at 2:34 pm 37
yvr2zrh… can you email me with details on the West Van and King Ed sales? village_whisperer@live.ca
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December 18th, 2012 at 2:40 pm 38
I upvoted Blast From The Past. There is value in checking the accuracy of everyone’s prognostications, whether bear or bull.
But, I don’t think Patriotz’ call was wrong. He said CMHC will not get reined in while we have a Conservative minority. That turned out to be correct. CMHC was reined in after getting a Conservative majority.
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December 18th, 2012 at 2:53 pm 39
Yeah I like to see more blast from the past
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December 18th, 2012 at 3:03 pm 40
“….management fees, strata fees, property taxes, mortgage interest, utilities, and various expenditures required to maintain one’s spot in the rental pool-new carpets, new tv etc etc….”
And don’t for get the much loved ‘Resort Fees’ which are brutal! Owners get the privilege of paying for all the Resort marketing to bring in tourists so that businesses can stay afloat (which gets tougher every day).
Hot debate. What do you think?
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December 18th, 2012 at 3:21 pm 41
“But, I don’t think Patriotz’ call was wrong.”
Well it was a tiny bit wrong, since we have got a $1million limit – which affects only a few % of properties Canada wide – before the bust has played out.
But being 95+% right on a three year old prediction is not doing too badly IMHO.
Hot debate. What do you think?
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December 18th, 2012 at 3:42 pm 42
“WestJet asks Flaherty “where’s our DB pension extension(bailout)”?”
That’s not what they’re asking. They are objecting to Air Canada being exempted from requirements to keep their DB pension fully funded, which presumably in their view gives AC an unfair competitive advantage. WestJet does not have a DB plan.
AC was privatized in 1988. Perhaps the government might be on the hook for pension obligations incurred before then, but given that’s 24 years ago it can’t be very significant compared to AC’s total obligations.
AC went through bankruptcy protection and reorganization in 2003 and that was their opportunity to put all their obligations to employees on the table.
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December 18th, 2012 at 5:01 pm 43
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December 18th, 2012 at 5:07 pm 44
I really miss the reply link…I suppose it was removed for security purposes…?
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December 18th, 2012 at 5:09 pm 45
patriotz Says:
The tightening in October of home-loan rules, which included capping tenures for all new home loans at 35 years, was the government’s sixth set of market-cooling measures since September 2009. They previously included additional stamp duties for some buyers, with higher levies for foreigners. The government had also raised down-payment requirements and increased land supply for developers.
Singapore New Private-Home Sales Fall to 2012 Low in November
I wasn’t going to bother including the fact that it’s the sixth set of measures over there but here’s some context for Patriotz and anyone else here….RTP
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December 18th, 2012 at 5:52 pm 46
“completely wrong again”
I was surprised the CMHC was reined in as it was before the crash started in earnest.
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December 18th, 2012 at 5:58 pm 47
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December 18th, 2012 at 6:33 pm 48
New Listings 76
Price Changes 36
Sold Listings 66
TI:14944
http://www.paulboenisch.com
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December 18th, 2012 at 6:37 pm 49
..and MoI limps along, 30% below December norms….
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December 18th, 2012 at 6:38 pm 50
..whoops. Meant sell-list 30% below norms; not MoI.
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December 18th, 2012 at 7:34 pm 51
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December 18th, 2012 at 7:54 pm 52
Apple soft landing, coming right up! No bubble here, folks.
http://finance.yahoo.com/echarts?s=AAPL+Interactive#symbol=AAPL;range=my
Hot debate. What do you think?
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December 18th, 2012 at 8:08 pm 53
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December 18th, 2012 at 8:10 pm 54
http://www.cbc.ca/news/canada/british-columbia/story/2012/12/18/bc-cypress-missing-snowboarder.html
Risk oblivious out of bounds snowboarder as it happens is
According to the story audio his job is… wait for it… mortgage specialist!
Apparently it is not enough that his job involves creating a moral hazard in mispriced home loans for society in general. No, not enough. What else can he do? Well, he can recklessly ski out of bounds to endanger the lives of rescue volunteers and run up hundreds of turbine hours in public operating expenses for costly rescue aircaft.
Send this dick the bill and use the courts to make it stick! This person respresents all that is wrong with the world today. What I see is a completely self involved, self entitled, and risk oblivious person who deliberately creates public hazard and expense for kicks!
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December 18th, 2012 at 9:21 pm 55
VHB, it’s looking like we’ll be sub-1200 sales for the month. Going into 2013:
- Population growth in 2012 is low (so far), and this tends to translate to lower sales the subsequent year
- New home completions are set to increase next year, adding to supply
- Credit looks unlikely to be easier to get in the coming year
- We will be starting from a larger base of inventory in January
Contrast this to 2009:
- Credit became significantly easier to get due to falling interest rates and government underwriting
- High levels of population growth in 2008 absorbed inventory
I’m seeing more headwinds in 2013 than 2009, and even 2012. We’re on pace for about -4% YOY in a few months. Imagine if 2013 is worse. I might even have to call it a “crash”!
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December 18th, 2012 at 9:30 pm 56
Re: 53 You would need to request Scotia to allow you do short-sales.
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December 18th, 2012 at 10:59 pm 57
Hope everyone is trying to enjoy the holiday season.
While you wait for a correction/crash….hope everyone is trying to increase income coming in. Remember, dont be waiting for something to arrive… go get it!
Hot debate. What do you think?
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December 18th, 2012 at 11:54 pm 58
#52 Seriously? Apple make a $400k profit per employee and has a P/E of 12, the S&P average is 15. They make the best computers and phones in the world, neither of which are going away.
Hot debate. What do you think?
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December 19th, 2012 at 5:17 am 59
“I wasn’t going to bother including the fact that it’s the sixth set of measures over there (in Singapore) but here’s some context for Patriotz and anyone else here….RTP”
Right, the context is that Singapore has brought in a series of wholly ineffective measures when policies that could actually bring prices down are simple and obvious. They won’t even get as tough as Canada’s own government and bring in 25 year amorts.
And this is a country where the government does what it damn well pleases and doesn’t care about public opinion.
The fact is that the Singapore government owns all land in the country and completely controls the RE market. Its high RE prices are a form of taxation.
Hot debate. What do you think?
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December 19th, 2012 at 5:25 am 60
Struggling real estate market can have huge impact on Conservative economic narrative
Well the good news is that the next election isn’t until 2015 and by then everything will be… uh… ruh-roh.
Hot debate. What do you think?
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December 19th, 2012 at 8:11 am 61
@JR
Yeah, the hate on people seem to have for Apple is a little strange; tall poppy syndrome I suppose. As for the bubble talk, It’s crazy really….. strip out the $120 or so billion in cash and the valuation (9x earnings) hardly seems lofty. Of course the problem now is: what are they going to do next? And it is a valid concern…..when you’re that big, continuing to grow is somewhat problematic. IF people want to talk about bubble stocks, the name that leaps to mind is Amazon.
Hot debate. What do you think?
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December 19th, 2012 at 8:19 am 62
@SDR
Shorting stocks is a fools game to begin with and no offense to you personaly, but if you can’t fiqure out the mechanics of initiating a short position, you shouldn’t be shorting stocks.
Hot debate. What do you think?
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December 19th, 2012 at 9:17 am 63
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December 19th, 2012 at 9:22 am 64
Carney to get $400K housing allowance in London
No that’s not a one shot, that’s annually.
Now for the question – is he going to buy or rent?
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December 19th, 2012 at 9:27 am 65
Gimp: “Shorting stocks is a fools game to begin ”
why it is fools game?
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December 19th, 2012 at 9:29 am 66
Ottawa may have to do more to tame Canadian households’ high levels of debt, the International Monetary Fund said on Wednesday.
http://www.bnn.ca/News/2012/12/19/Even-tighter-mortgage-rules-may-be-needed-IMF.aspx
10% down would be the coup de grace!
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December 19th, 2012 at 9:46 am 67
Teranet data for November is out. I updated mohican’s house price to MOI correlation graph. The red dot on the bottom right is the latest datum.
MOI is hovering around 10. If this correlation holds you can do the math on where the HPI is going to end up in 3 months’ time.
http://twitpic.com/bne3ge
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December 19th, 2012 at 9:53 am 68
@SDR
“why it is fools game”
Because the risk exposure is asymmetrical.
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December 19th, 2012 at 10:11 am 69
Apple’s trailing P/E may be 12x, but it’s price-to-book ratio is about 4.5x. If you back out $120B of cash and equivalents, then the Enterprise value as a multiple of non-cash shareholder’s equity book value is enormous (over 20x). Back in 2002 when it was inventing the i-pod etc it was trading close to 1x book value.
There is an awful lot of assumption about future profitability in the Apple share price. Given this is an industry with an awful lot of competition, powerful telecom customers, and fickle fad-chasing end users, I think you would need to be highly confident in the coming product launches to hold Apple at this price.
Hot debate. What do you think?
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December 19th, 2012 at 10:43 am 70
I’m also not convinced of proclamations that AAPL is cheap. The company is coming off a 4th iteration of a the latest product release, with NOTHING new in the pipeline. Apple needs a brand new blockbuster product; iPads are mature, although I think the retina display helped to prolong the product cycle an extra release iteration, as it’s really quite the difference maker.
Hot debate. What do you think?
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December 19th, 2012 at 10:51 am 71
@Anonymous: How do you know there’s nothing new in the pipeline?
On another note, what happened to the reply buttons that used to be on each post?
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December 19th, 2012 at 10:53 am 72
@jesse: Excellent work as always. Have you considered using a colour gradient for the plotted points, from oldest to newest, rather than breaking out just the last 6 months in a different colour? I think it would help to illustrate the evolution of the market.
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December 19th, 2012 at 10:56 am 73
@Many Franks, I could do that, but I am somewhat limited by what google spreadsheets can do for graphs.
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December 19th, 2012 at 10:56 am 74
Keep the stock talk out of this forum, ok? At least, the non-housing related stocks..
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December 19th, 2012 at 11:13 am 75
TD provincial economic forecast released today:
- Table: average existing home price forecast 2013-2014
Worse for everyone except BC (& NB)?? lol.
Hot debate. What do you think?
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December 19th, 2012 at 11:16 am 76
Some owners are becoming very aggressive: MLS® V969645 just decreased the asking price by $2000.
(Sarcasm off).
http://www.realtor.ca/PropertyDetails.aspx?PropertyID=12379018&PidKey=2017863752
Hot debate. What do you think?
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December 19th, 2012 at 11:25 am 77
@jesse: Is your dataset public? If so, I’ll see what I can put together.
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December 19th, 2012 at 11:32 am 78
@Manna from heaven #65
IMF said the same thing in Dec 2011
“Policy makers should continue to watch developments in the mortgage market closely, the fund said. Lending for homes has slowed, but still is growing at a “robust” pace of almost 7 per cent, the report said.
Finance should be ready to take steps to slow borrowing further if home lending continues to expand excessively, such as larger down-payment requirements for mortgages and demanding lower debt service-to-income ratios, the IMF said.”
BUT Flaherty said in Oct/12 “We’ve done enough. I do not intend to do anymore.”
- What’d the F do?
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December 19th, 2012 at 11:40 am 79
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December 19th, 2012 at 12:06 pm 80
78 Suburbia
That is a no brainer of course you would buy if that were the case but those are antiquated metrics. They are present in Phoenix and in California et als. But that is and will be post crash so save your money folks and these opps will be possible one day again.
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December 19th, 2012 at 12:10 pm 81
@suburbia. Full marks for a well thought out analysis, every potential buyer should spends at least 5 minutes to run the numbers.
If look at the price to rent for your hypothetical it’s about 14 (since $1000/month carries about a $200K place). In this case buying is attractive, as you correctly pointed out. More interesting would be to look at some real world examples in Vancouver, I’d wager in most cases the price to rent is well in excess of 20. Our place is about 25.
Hot debate. What do you think?
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December 19th, 2012 at 12:18 pm 82
Many Franks, the spreadsheet is here
Hot debate. What do you think?
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December 19th, 2012 at 12:48 pm 83
Ending quote in this video: “Vancouver home owners shouldn’t expect brighter or more lucrative days for there real estate investment anytime soon”
http://www.globaltvbc.com/vancouver+real+estate+slowdown+helps+sink+national+housing+sales+forecast/6442774586/story.html
Also, the GlobalTV hacks and Cameron Muir are still trying to get the masses worked into a lather over Flaherty and the mortgage rule changes ( which patriotz said would never happen).
Hot debate. What do you think?
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December 19th, 2012 at 1:18 pm 84
“Yeah, the hate on people seem to have for Apple is a little strange”
It’s all the Mactards out there that love Apple so much that gives me the willies.
Hot debate. What do you think?
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December 19th, 2012 at 1:53 pm 85
“Full marks for a well thought out analysis,”
This “analysis” is utter nonsense, right from failing to give the purchase price and interest rates which are supposed to result in the assumed mortgage schedule.
It does not compare rental value with actual expenses. And it ignores opportunity cost and present value.
It’s not worth trying to work out the assumed price from the numbers given.
Hot debate. What do you think?
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December 19th, 2012 at 1:57 pm 86
“which patriotz said would never happen”
That is not what I said. If you’re going to accuse me or anyone else on this forum of this sort of thing, give a verbatim quote or STFU.
Hot debate. What do you think?
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December 19th, 2012 at 2:16 pm 87
Here’s the quote from yesterday. Seems pretty black and white to me. No need for colorful language, patriotz.
Was the CHMC reined in – yes.
Was a price ceiling introduced – yes.
Did you say that this wouldn’t happen? – yes.
Were you wrong. – yes.
patriotz Says:
November 25th, 2009 at 11:19 am
@Nero:
>I think at some point the CMHC will have to be reined in. My money is on them being forced to reintroduce a price ceiling.
Not going to happen as long as we have a “Conservative” minority government. It would be an admission that they had been fueling a housing bubble to try to juice the economy and gain themselves a majority. It would also induce a bust that the party in power would be blamed for.
Hot debate. What do you think?
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December 19th, 2012 at 2:22 pm 88
@Patriotz. I don’t really understand your need to be so dogmatic and abrasive all the time. Here’s a poster who’s given it more thought than 90% of folks out there, and you still want to nail him to the wall because he didn’t explicitly state a purchase price? Sheesh.
It should be obvious that he’s talking in broad brush strokes and trying to spitball some hypothetical numbers, pretty easy to infer an approximate $200K purchase price based on the mortgage assumptions. Any analysis is going to have pretty big confidence intervals anyways, considering uncertainty around future inflation and interest rates.
Just try to lighten up a bit and engage people in respectful conversation once in a while, maybe you’ll both learn something.
Hot debate. What do you think?
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December 19th, 2012 at 2:33 pm 89
Falling Ice Damages 2 Cars on New Port Mann Bridge!!!
“At least two vehicles have been smashed by falling ice from the Port Mann Bridge as a heavy snowfall continues to cause mayhem in Metro Vancouver.
RCMP Sgt. Roland Pierschke, a spokesman for the Port Mann Freeway Patrol, said sometime before 1 p.m. large chunks of ice began falling off either the towers or cables on the bridge. Several lanes have been closed and traffic is at a standstill, he said.
Pierschke did not have many details yet, but said at least two vehicles have been badly damaged and will need to be towed off the bridge.”
http://www.vancouversun.com/technology/Snow+falls+Metro+Vancouver+Fraser+Valley+schools+closed+some/7714237/story.html
Hot debate. What do you think?
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December 19th, 2012 at 2:47 pm 90
Mick Murphy: Patriotz statement was qualified by “as long as we have a “Conservative” minority government”. With that qualification, his statement was not wrong.
Hot debate. What do you think?
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December 19th, 2012 at 2:55 pm 91
oh, patriotiz… another bad call. 3 years later we are still waiting for prices to reach 2009 levels. but i’m sure you’ll tell us how you were actually correct. can’t wait for that
patriotz Says:
February 3rd, 2009 at 5:27 pm
That’s the composite benchmark that includes both attached and detached. Detached was $659,638, up slightly from last month.
And for those who think this indicates a market bottom, well all I can say is get out and buy. Keep a Realtor in his Beamer.
Hot debate. What do you think?
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December 19th, 2012 at 2:55 pm 92
@suburbia # 78
I used to go to dealerships to practice car shopping before actually shopping for a car. This analysis really reminds me some of those visits. Everytime I asked about the price, the agent started from asking me “How much you want to pay a month?”. When I clearly stated that I wanted to start from the actual car price (MSRP, invoice, whatever), they became a bit less enthusiastic and switched to another set of tricks.
Here is what I have to add to what other posters said.
A.
>Assume you can rent for $1200 or have a $1000/mth mortgage payment
Ok, let’s assume it, but it sounds like an extremely high-LTV, 40-years mortgage here in Vancouver.
B.
>your mortgage payment is probably 50% interest and 50% principal.
This is a very bold assumption. The real numbers may vary depending on the mortgage type. For high LTV, long-term amortization mortgages this 50/50 rule cannot be applied for the first 10 years, period. For example, see this calculation:
http://allfinancialmatters.com/2006/05/24/a-look-at-mortgage-payments/
So, this assumption contradicts to A.
C.
>so the outflow from your pocket will be a lot more than $144,000
How much is “a lot more”? From my experience, landlords in BC do not increase rents every year (once every three-to-five years, I would say), and allowable increase was 4.3% in 2012.
D.
>In fact, your property value can go down and financially speaking,
>it might still be better to own.
Wow. Just like that. Care to give us some numbers please? What’s your threshold on the way down, for example?
E.
The last paragraph does not give any information, sounds like a randomly generated mantra full of keywords like equity, investment, risk.
F.
Now I understand why I am not too good at selling things… Thank you for the exercise!
Hot debate. What do you think?
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December 19th, 2012 at 2:56 pm 93
Hidden due to low comment rating. Click here to see.
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December 19th, 2012 at 3:36 pm 94
Looks like somebody figured out a way to wank the thumbs up/thumbs down scoring.
Hot debate. What do you think?
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December 19th, 2012 at 3:39 pm 95
@Anon #93
“Looks like somebody figured out a way to wank the thumbs up/thumbs down scoring.”
It takes just one jobless guy driving/walking between a bunch of startbucks with wifi.
Hot debate. What do you think?
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December 19th, 2012 at 3:53 pm 96
@C. Junta
Like or Dislike:
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December 19th, 2012 at 3:54 pm 97
New Listings 36
Price Changes 21
Sold Listings 47
TI:14844
http://www.paulboenisch.com
Well-loved. Like or Dislike:
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December 19th, 2012 at 3:58 pm 98
@Troll #95
“Well, this guy is using a 30 year mortgage with a 7% interest rate for his calculations”
I missed this piece. Where is it? Anyways, this is exactly what I am talking about: give me the full picture before calculating anything – property price, mortgage amount, rate, amortization period etc.
Like or Dislike:
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December 19th, 2012 at 4:06 pm 99
“Wow. Just like that. Care to give us some numbers please? What’s your threshold on the way down, for example?”
That’s part of the problem. Everybody can point to clear examples where it’s better to buy than to rent, and vice versa, but nobody can agree on where the break-even point is. Because there are simply too many assumptions that need to made over a long time period (interest rates, rent inflation, appreciation/depreciation, taxes, maintenance, etc, etc)
Like or Dislike:
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December 19th, 2012 at 4:06 pm 100
Re #78
I agree Troll, nice to see someone putting in the effort to present a reasoned argument on the other side of the coin even if the numbers don’t work well for valuations around here. But the last statement is pretty ignorant. It alone puts his entire post into my trash bin.
“It will also depend on your risk tolerance and the value you place on actually having a place of your own over time and never wanting to end in a shelter”.
We typically have less than 70% homeownership. Do we have 30% of our older people residing in shelters? Paying a mortgage is not the only way to save for retirement you arrogant dumbass.
Hot debate. What do you think?
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December 19th, 2012 at 4:14 pm 101
” and you still want to nail him to the wall because he didn’t explicitly state a purchase price? ”
He didn’t explicitly state anything. He was just talking out of his ass. There is no more polite way to put it.
Hot debate. What do you think?
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December 19th, 2012 at 4:16 pm 102
” Seems pretty black and white to me.”
Seem pretty black wand white to me, too. I said “as long as we have a Conservative minority government”, not “never”.
Hot debate. What do you think?
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December 19th, 2012 at 4:34 pm 103
In your face Bears! 100+ sell/list! 47 sales is good, right?
Hot debate. What do you think?
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December 19th, 2012 at 4:41 pm 104
“It takes just one jobless guy”
Jobless Guy,i.e. ‘Realtor’.
Ha, ha. I love the smell of unemployed Realtors in the snow.
Hot debate. What do you think?
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December 19th, 2012 at 4:41 pm 105
Well-loved. Like or Dislike:
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December 19th, 2012 at 5:00 pm 106
Yikes, getting ugly. Anyone have the day-to-day sale comparisons for December compared to 2011 and 2010? I imagine they normally probably drop off sharply from here through the holidays, but don’t really have much further room to drop…
Hot debate. What do you think?
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December 19th, 2012 at 5:17 pm 107
Hidden due to low comment rating. Click here to see.
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December 19th, 2012 at 6:11 pm 108
“Looks like sfh are in trouble but downtown condos are still doing great. If you had bought a pre sale in 2008 like I said you’d all be doing a lot better.”
Presales are priced way above market to begin with. If you bought a presale in 2008 you would be underwater today. Look no further than the 2008 Olympic Village presale purchasers who have taken about a 40% hair cut. There are buildings that presold in 2006 that can’t even break even if sold today.
Hot debate. What do you think?
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December 19th, 2012 at 6:33 pm 109
Who are the 36 assholes who listed their places for sale 5 days before Christmas?
Of all of the 52 weeks available you stupid motherfuckers pick this one?
Hot debate. What do you think?
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December 19th, 2012 at 6:56 pm 110
@Best place on meth
did your mom teach you that language?
Hot debate. What do you think?
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December 19th, 2012 at 7:09 pm 111
@Groundhog #105
We have 6 Business days left (including Dec 24 & Dec 31 but excluding boxing day)
Last 6 business days of the year:
2010: avg ~75 sales/day (vs ~100/day the previous 6 days)
2011: avg ~55 sales/day (vs ~82/day the previous 6 days)
2012: avg ??? sales/day (vs 59/day the previous 6 days)
Hot debate. What do you think?
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December 19th, 2012 at 7:20 pm 112
@Babe
No, I taught my mom and Bob Rennie’s mom taught me.
Why do you give a fuck about the language used on a site frequented (supposedly) by adults?
Would you like me to direct you to a Disney site where the language is more appropriate for you?
If you’re extremely sensitive please let me know and I’ll tone it down.
Hot debate. What do you think?
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December 19th, 2012 at 7:32 pm 113
@ Best place on meth
Probably people having to sell because of circumstances beyond their control such as a forced career move or maybe they are really really sick of the weather. Patriotz will probably critique something I just said though….so let me emphasize……really really really really really sick of the weather.
Hot debate. What do you think?
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December 19th, 2012 at 7:46 pm 114
Thanks VMD
A chance we see under 1100 sales this December if we see a similar type drop off for the last 6 days. Must be the weather.
Like or Dislike:
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December 19th, 2012 at 8:21 pm 115
Remember–sales lag by 10days to two weeks on average, so sales we are seeing in the numbers today were actually made like 2 weeks ago. It is for that reason that sales the first couple weeks of January are so low–so few actual deals made the last 2 weeks of December.
Hot debate. What do you think?
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December 19th, 2012 at 8:27 pm 116
Hidden due to low comment rating. Click here to see.
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December 19th, 2012 at 8:48 pm 117
This is a link to the presentation put on by Lepoidivin (sp?) group in case you missed it earlier this month with Ben R…. It’s the full 1.5hr so get some popcorn first.
http://www.youtube.com/watch?v=pagbjwKJyV4&sns=em
Hot debate. What do you think?
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December 19th, 2012 at 9:10 pm 118
New Listing Today!
Almost new cable span bridge. Must sell.
Note: Not usable in winter months
Well-loved. Like or Dislike:
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December 19th, 2012 at 9:16 pm 119
Rob A: “The Olympic village isn’t a typical pre sale.”
I know. It might be one of the better ones after losing 40% (so far). Which dog did you buy?
Like or Dislike:
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December 19th, 2012 at 9:46 pm 120
Re #109
Go easy on poor BPOM. He is very easily insulted. Like if you suggest he might one of the “less informed”, he gets really hurt and might call you a f***ing douchebag or something like that in return.
Hot debate. What do you think?
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December 19th, 2012 at 10:09 pm 121
BPOM: when you stop posting, I really miss your colourful language.
PC can be so boring
Like or Dislike:
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December 19th, 2012 at 10:19 pm 122
Mark it in your calendar: Sunday, February 10, 2013.
The lunisolar calendar new year (aka Chinese New Year).
Apparently local developers and agents are expecting the big bounce-back in demand around then. If they get nothing but crickets at the open house then we’ll see flashes of fear in the eyes of the true believers. We wont have to wait til May.
Like or Dislike:
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December 19th, 2012 at 10:40 pm 123
VMD, from my data, which is sparse and using some crude estimates since paulb was on vacation over that time, I have the first 13 days of December ’10-’11 being 100,87 respectively. The sales on remaining days to equal reported month-end are therefore 75,74. Averaging that means sales for the remaining days are 80% of the first 13 days. This isn’t quite correct because paulb reports slightly higher figures than what REBGV reports, so his numbers would actually be estimated at something like 85% of the first 13 days.
We are at 65 sales per day for the first 13 days. The remaining 6 days, at 80% would be 52 sales per day. That would put us at 1151 sales as reported by REBGV. paulb would probably sum to something a bit higher, probably a bit under 1200.
To get to 1180 “paulb sales” for December would be 57 daily sales.
If we just use 2011 ratio as a gauge that would equate to 1173 REBGV sales, if we use 2010 ratio as a gauge that would equate to 1129 REBGV sales.
Again, this is based on somewhat sparse data. I would not discount sales being worse from here on in compared to the last two years. My estimate at the beginning of the month was 1159 REBGV sales. That’s looking a bit optimistic but we’ll see how busy REBGV data entry clerks are over the next week
Like or Dislike:
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December 19th, 2012 at 11:06 pm 124
#94
“Looks like somebody figured out a way to wank the thumbs up/thumbs down scoring.”
It takes just one jobless guy driving/walking between a bunch of startbucks with wifi.
Unfortunately, there is a way of doing it without even switching wi-fi spots.
Like or Dislike:
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December 20th, 2012 at 12:12 am 125
Re #121 “Mark it in your calendar: Sunday, February 10, 2013.
The lunisolar calendar new year (aka Chinese New Year).
Apparently local developers and agents are expecting the big bounce-back in demand around then.”
That’s what they expected for 2012. And this is the year of the Dragon too!
Next year will be the year of Snake, damn. Bad feng shui to buy — and even worse to sell.
Like or Dislike:
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December 20th, 2012 at 12:47 am 126
@Jesse “My estimate at the beginning of the month was 1159 REBGV sales. That’s looking a bit optimistic”
- Jesse you’ve gotta exercise caution using words like “optimistic” and “pessimistic” here, it can be confusing ; )
I was just accused of having “a heart filled with darkness” and “unable to see the sun behind the clouds” by a bullish mortgage advisor on a Chinese forum, lol.
Looking forward to the official stats. Too bad the forum’s down right now but we’ll still have a winner of the RE Prediction Contest. Also too bad REBGV don’t tend to publish Year-end total inventory on its Dec stats packages (I guess due to massive year-end expiries) so we can’t get the “official MOI”. We’re probably looking at ~12 MOI by year-end.
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December 20th, 2012 at 2:38 pm 127
“….want to live downtown because that’s where the action is…..”
I keep forgetting that tenant (sic) of RE badgering along with: ‘there not making any more land on the ground’, ‘the moon is made of cheese and there not making any more cheese’, ‘hemmed in by mountains on one side and people who don’t want to pay more on the other’, ‘how could prices possible stay the same’, ‘buy now or be priced out until later’. etc, etc.
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December 20th, 2012 at 3:06 pm 128
“….so let me emphasize……really really really really really sick of the weather……”
Welcome to Vancouver, where it rains 10 months of the year and ‘showers’ for the other two.
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