FFFA! Price! Decline! How low?

Hey! You made it to the end of another work week!

Now it’s time for us to do our regular end of the week news roundup and open topic discussion thread for the weekend.

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

How low will house prices go?
Banks see slowing mortgage growth
Vancouver prices soften
13k party time!
Bad time to be a realtor?
Pricing property in a falling market
Majority want to invest but cant afford to
Goodbye Waldorf
Sales sunnier outside Vancouver
A relaxing 80 minute drive
Gov loses student loan info

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

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R
Guest
R

So I wondered… Am I the only person who finds it more convenient to use open houses to check out different condo buildings and layouts in an area I’m thinking of renting in than actually troubling property managers/tenants?

Sometimes I even get given snacks!

(I’m a buyer, possibly, if SFH prices fall ballpark 50-60% in the next few years. Otherwise I’ll just move to Seattle.)

real_professional
Member
Hello realtor, my old friend I’ve come to talk with you again Because listings softly creeping Reduced home values while I was sleeping And the retirement that was planted in their brain Still remains Without the sound of buying In open houses I walked alone Narrow driveways of faux cobblestone This listing even claims the street lamp Toronto, Vancouver? One’s cold, one’s damp When my eyes were stabbed by the flash of a reduced sign That split the neighbour’s spine And touched the sound of crashing From a yellow helicopter I then saw Thirteen thousand listings maybe more People looking without buying People giving but no taking People writing songs that CREA never shared No one dared Disturb the sound of popping “Greater Fools,” said I, “you do not know Listings like a cancer grows See my charts that I… Read more »
Loon
Guest
Loon

My 2 year old farted this morning. Said it was a bubble. Brilliant!

Q
Guest
Q

It turns out the maple leaf on the new plastic $20-bill is not a Canadian maple leaf. It is a leaf from a Norwegian Maple, which is considered to be an invasive species in Canada.

http://www.cbc.ca/news/canada/ottawa/story/2013/01/17/ottawa-foreign-maple-leaf-irks-botanists.html

Many Franks
Guest
Many Franks
Some ugly stats on Canadian consumer behavior: As of last September, Canadian households were in debt to the tune of $474 billion. That equates to one and a half year’s net income per household. In British Columbia, the average household consumer debt was $38,837 (the highest in Canada). Remember that this does not include mortgage debt. We have car loans, personal loans, lines of credit, and credit cards. Although most of us are managing to stay out of serious trouble, we are not doing all that well overall. About half of us with credit card debt either always or often fail to pay off the full balance owed each month. That is what turns a “credit card” into a “debt card.” A 2012 poll found that one person in every 20 felt they would never be able to fully pay… Read more »
Left already living in San Diego
Guest
Left already living in San Diego

23 degrees and sunny here in San Diego.
Are you still enjoying golfing, sailing and skiing on the best place on earth, all at the same day?

gordholio
Member

#2, real_professional: Awesome, just awesome.

YLTNboomerang
Member

Can anyone explain to me why REIT’s are doing so well if we are in a bubble? I’m the biggest bear around and I get that many of them are solid because they are focused on commercial RE but I’m hearing more and more about them focusing on residential properties. I get that there are still cashflow positive properties in the middle of Canada but as more cash flows into these organizations eventually they are going to have to buy where the inventory is (TO, VC, etc.) and where there is no way they can be +ve.

Even if these guys are positive, if we have a RE crash, do they have to mark their assets to market?

Troll Feeder
Guest
Troll Feeder

Real Professional, that was amazing. Can you archive that on vancouverpeak? If you don’t I will. Any musicians reading this that want to perform that? I’d love to hear it.

crashcow
Member

real_professional,

Nicely done!

Someone did a similar one for stock brokers:
http://www.youtube.com/watch?v=0ufxcMqsZpM

“Hello Wall Street my old friend
I’ve come to beg for business again
Monthly payments slowly creeping
Just sold a car I thought I was keeping”

Groundhog
Guest
Groundhog

@YLTNboomerang

Investors seeking yield in a ZIRP environment

Short'em High
Guest
Short'em High
YLTNboomerang Says: January 18th, 2013 at 9:18 am … if we have a RE crash, do they have to mark their assets to market? No, but the market will mark and certainly overshoot on the price of their debt instruments, equity shares, and credit default derivatives… What RE flipper bulls fail to realize about their trading in physicals is that there is no possibility of creating a hedge or protective trailing stop order. Flippers are going to lose all their gains and more. With REITs at least there is a 50/50 chance of getting out without losing your shirt. You can also work out for yourself if cummulative distributions will cover your worst case loss. On the other hand, as the inevitable crisis looms, it may be more profitable to be short after each distribution rather than long on the… Read more »
Patiently Waiting
Member
Patiently Waiting

Reading the complaints in this Craigslist post would make you think of some rat-infest 70s building off a bad part of Commercial Drive:

http://vancouver.en.craigslist.ca/bnc/hou/3524540722.html

Well, its actually about a Burnaby condo building completed only last year.

Building today’s slum today.

Affinity by Bosa.

patriotz
Member

“Even if these guys are positive, if we have a RE crash, do they have to mark their assets to market?”

They mark their assets to market on the balance sheet every year, but that doesn’t affect their earnings. REIT’s buy properties for income not speculation.

As Groundhog said that real problem with REIT’s is that the people who buy the units (i.e. the stocks) are paying too much for them. There is nothing the management can do about that.

elvince
Guest
elvince
@YLTNboomerang 2 things will influence how much profit a (correctly operated) REIT makes: interest on its debt and rent revenue. Obviously, if interest rates rise too much, REITs will suffer, but some of them got into really long term mortgages at low rates, so they do have their bets somewhat edged on that front. The rent revenues can fluctuate, and this is mostly how you find out which REIT is better managed. Vacancy rate can kill profits pretty fast, but then again, many commercial or office buildings are leased for many, many years. Most companies don’t want to move all their workers every now and then, so 10+ years lease are common. Since there is quite a high built-in cost for office or commercial tenants to move, the owner can raise rents without too much risk of losing its tenants.… Read more »
TPFKAA
Guest
TPFKAA

@ Real Professional:

That’s some seriously funny shit!!! (And funnily serious too).

Well done.

chilled
Member
chilled

Left already living in San Diego Says:
January 18th, 2013 at 8:24 am

23 degrees and sunny here in San Diego.
Are you still enjoying golfing, sailing and skiing on the best place on earth, all at the same day?

===========

Say hello to Kalluk, Tatqiq and Chinook for me, OK?

stompy
Guest
stompy

Re: #13

“Unit 7 0 6 is an illegal factory, also managed by A D V E N T . Mr. Stompy upstairs owns a 247 factory. He does his laundry after 11pm, sleeps at 3am EVERY night and wakes up at 4am.. constant noise and stomping!”

Sounds like a brothel?

Anonymous
Guest
Anonymous

…What a douche! I’ll bet his calculator is still in the package..

Ya, but not because he couldn’t use it. It’s because he couldn’t figure out how to open the package.

trash crash alert
Guest
trash crash alert
Looks like we are on the BUST cycle: Billionaire investor George Soros has been an active promoter of the relevance of reflexivity to economics first propounding it publicly in his 1987 book.[1] He regards his insights into market behaviour from applying the principle as a major factor in the success of his financial career. Reflexivity is discordant with equilibrium theory, which stipulates that markets move towards equilibrium and that non-equilibrium fluctuations are merely random noise that will soon be corrected. In equilibrium theory, prices in the long run at equilibrium reflect the underlying fundamentals, which are unaffected by prices. Reflexivity asserts that prices do in fact influence the fundamentals and that these newly-influenced set of fundamentals then proceed to change expectations, thus influencing prices; the process continues in a self-reinforcing pattern. Because the pattern is self-reinforcing, markets tend towards disequilibrium.… Read more »
Groundhog
Guest
Groundhog

@trash crash alert

Alchemy of Finance?

Short'em High
Guest
Short'em High
Attn: REIT pickers, finance accounting believers, and high ratio book experts. How does one pick a REIT that won’t gap down one day by 50% and never come back? Is there an unstated assumption here or is this forum simply a hangout for a different sort of irrational believer? One thing that surprises me (maybe I shouldn’t be surprised), is when RE stock advice is posted on this forum, nobody ever mentions a stop loss exit price/percent. What we do see are endless remarks about accounting practice, management genius/stupidy and so on. It is remarkable that some who consider physical RE risky because of the likely and sudden price gap (crash), think little of the same problem in RE stocks. Armchair platitudes on “future earnings” will not reduce the damage to your account if the share price suddenly tanks –… Read more »
Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@real_professional that’s genius.

if that song was submitted to a crowd sourcing site i would help fund it with some of my vast real estate profits.

i want to see that sung on youtube by a professional musician someday.

Anonymous
Guest
Anonymous

…which is considered to be an invasive species in Canada….

Though you were referring to Realtors for a minute.

gokou3
Guest
gokou3

US policymakers didn’t foresee their “US-style” housing crash. Will our counterparts do any better?

http://finance.yahoo.com/news/fed-missed-warning-signs-2007-183654997.html

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