Crumbling real estate markets in BC

Ben Rabidoux over at The Economic Analyst has a post focusing on the falling markets in Vancouver and Victoria.

As VHB points out the last two years saw 2 & 3 days in February with daily sales under 100.  We’re now 5 sales days in and we’ve seen 3 sales days under 100.

Sales better pick up in the remaining 15 business days or the market is at risk of having a worse february that 2009, the worst year in recent memory.

We’re not hearing much about it in the local media, but the real estate market in Vancouver is seeing rising listings, sagging sales and dropping prices.

Over at Vancouver Peak 604x points out the lack of reasonable reporting on this topic in the local media and brings up the topic of conflict of interest.

He’s put together a form letter with contact info for the broadcast standards council.  Here’s an excerpt:

We all remember the false and misleading behaviour of the news media during the technology “bubble” of the late 1990s and early 2000s. In both the US and Canada many people lost substantial sums of money due to the cheerleading of certain media outlets. After the dust settled it was found that many of these media outlets and “economic correspondents” had conflicting interests – owning the stock of companies they were actively reporting on and actively pumping.

The same is happening today in Canada with news reporting of the current real estate market. Many reporters and news organizations, most notably Vancouver’s branch of Global TV (CTV network), are delivering hyped up media and false/misleading reports on the status of the real estate market in BC. I believe this is also true for CTV’s Toronto reporting. A defining characteristics of such coverage is (i) one-sided reporting (i.e. “prices are about to take off”), and (ii) interviews with real estate agents and staff of real estate companies who have a clear conflict of interest in the current market. The behaviour goes beyond sensationalist headlines designed to boost circulation and sell ads – these news correspondents appear to be actively pumping the market for personal gain.

Read the full post here.

 

 

 

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Joe Q
Guest
Joe Q
3 years 7 months ago

The market is getting so bad its almost scary. Yikes.

Q
Guest
Q
3 years 7 months ago

I think this is awesome. Some lady down in Florida filed papers to claim “Adverse Possession” of the vacant, foreclosed house right next to her house. She then rented the house out for $1500 per month. The lady (who is a writer for a Florida newspaper) collected $13,500 in rent for a FREE house before she was arrested for identity theft. But it sounds like she is going to fight the charges based on Florida’s Adverse Possession laws which go back hundreds of years and allow people to lay legal claim to unoccupied real estate.

http://www.palmbeachpost.com/news/news/crime-law/cops-say-west-palm-woman-rented-out-neighbors-fore/nWGRF/

Q
Guest
Q
3 years 7 months ago

@Joe Q

I say bring it! I’m not scared of a real estate crash at all. I think the prospect of real estate prices that go up year after year for eternity and never-ending waves of HAM washing ashore to be far scarier than any real estate crash.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
3 years 7 months ago

“As VHB points out the last two years saw 2 & 3 days in February with daily sales under 100. We’re now 5 sales days in and we’ve seen 3 sales days under 100.”

why do people entertain such useless statistics?

VHB
Member
VHB
3 years 7 months ago

Actually, we have only had 4 days so far in February, so we are at 3 out of 4.

LocustLand
Guest
LocustLand
3 years 7 months ago

What kind of loser RE bull spends ALL day every day lurking around and posting useless crap on a RE bear site?
A) RE agent with absolutely nothing better to do and is in denial
B) recent specu-vestor who is now crapping his pants
C) HAM sponge who is wondering where all the HAM went
D) and most humorous – all of the above

Anonymous
Guest
Anonymous
3 years 7 months ago

Argh…hate how realtors are pumping Teranet’s Canada-wide gain of 3% in 2012.

Groundhog
Guest
Groundhog
3 years 7 months ago

@LocustLand

I enjoy having Bull! Bull! Bull! around as it reminds me how ridiculous people sound when then try to argue against the risk of a crash in Vancouver.

The funny thing is, the most credible bullish arguments on this site (or anywhere else for that matter) have come from people like Jesse and VMD when they’ve listed out scenarios that could possibly be bullish.

RealktyCheck
Guest
RealktyCheck
3 years 7 months ago

40% drop here?

Hahahah. You got to be insane!

A $600,000 house in Surrey with 2 basement suites dropping to $360000??

I’ll buy them all well before that price. The rental income of $3000 a month will provide a stable income after the mortgage is paid!!

An Observer
Guest
3 years 7 months ago

Good luck getting financing for the rental when all of your equity has been destroyed plus it is easy to say “when house abc gets to price xyz then it is an obvious time to buy”. The problem is that when house abc gets to xyz price there will be no appetite for real estate at all, much less as an investment. Oddly enough when this feeling of disgust towards real estate occurs it will be a good time to buy

UBC in crisis mode
Guest
UBC in crisis mode
3 years 7 months ago

I think CRTC should be involved in investigating the misleading media:

http://www.crtc.gc.ca/RapidsCCM/Register2.asp?lang=E

DaMann
Member
DaMann
3 years 7 months ago
“40% drop here? Hahahah. You got to be insane! A $600,000 house in Surrey with 2 basement suites dropping to $360000?? I’ll buy them all well before that price. The rental income of $3000 a month will provide a stable income after the mortgage is paid!!” Wonder how that rental income will look like at 5-6-or 7% interest rates? Bloody hell people are thick. The only reason why that house in Surrey is “worth” $600k right now is because the borrowing costs are pretty much free right now. Let’s see how these clowns manage to hold on when rates start… Read more »
Short'em High
Guest
Short'em High
3 years 7 months ago
@RealktyCheck What if there are no renters in Surrey for your “bargain” acquisition? What if a 40% drop results in a knock on effect of massive layoffs and people simply move back to wherever they came from? The dream of getting something for nothing on a “sure thing” will evaporate before your eyes. This IS what happens of course. People will “buy the dip” and get wiped out. So, please DO buy all you can afford. The more money committed, the more there is to bleed out… When the time comes, whatever you made in the past (or saved on… Read more »
Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
3 years 7 months ago

@LocustLand, @Groundhog

personal abuse doesn’t advance your argument.

N
Guest
N
3 years 7 months ago

@RC

You might, but then you have to make sure all the suits are tenanted, fix the boiler etc. (or pay a management company to do so). It might work out to be a good investment, but if prices don’t go up, it won’t be a great investment. Books like Rich Dad Poor Dad were premised on getting people to make these kind of investments which, at the time weren’t popular because they take a lot of work and there is quite a bit of risk involved. Real estate is a lot less sexy when the price isn’t going up.

Bag it and tag it
Guest
Bag it and tag it
3 years 7 months ago

Love the form letter. One thing I’d add is the conflict on interest media outlets have with their main source of advertising revenue.

gokou3
Guest
gokou3
3 years 7 months ago

“40% drop here?

Hahahah. You got to be insane!

A $600,000 house in Surrey with 2 basement suites dropping to $360000??

I’ll buy them all well before that price. The rental income of $3000 a month will provide a stable income after the mortgage is paid!!”

You assume rent to stay the same in that situation?

Yalie
Guest
Yalie
3 years 7 months ago

40% drop here?

Hahahah. You got to be insane!

A $600,000 house in Surrey with 2 basement suites dropping to $360000??

I’ll buy them all well before that price.

Indeed you will.

I always wondered who exactly are those people who buy on the downward slope of a real estate bubble, oblivious to the fact that the bottom is still well off. I think we now have the answer.

Q
Guest
Q
3 years 7 months ago

Vancouver’s 10 Worst Rental Buildings:

http://www.vancouversun.com/news/metro/Photos+Vancouver+worst+rental+buildings/7928879/story.html

Even one building on the West Side made the list: 104 W. 11th Ave.

Democrass
Guest
Democrass
3 years 7 months ago
The comment below by Q is a sad example of how so many Canadians think that criminals are awesome. It’s the cultural trait behind the fact that there have been essentially no white clollar crime prosecutions and convicions in Canada. It’s also why judge’s scentences are habitually law and the reason why if you are scentenced to 4 years, you get out in 4 months. “I think this is awesome. Some lady down in Florida filed papers to claim “Adverse Possession” of the vacant, foreclosed house right next to her house. She then rented the house out for $1500 per… Read more »
Many Franks
Guest
Many Franks
3 years 7 months ago

@Democrass: If she successfully manages to claim adverse possession and has the paperwork to back that up, I’d say there’s plenty to admire about it. If it’s a low-grade Craigslist rent scam, then yeah, lock her up.

Q
Guest
Q
3 years 7 months ago
@Democrass: The article I linked to does not say the woman was convicted of any crime. All it says is that she was charged. She remains innocent until proven guilty. And she may have a sound legal defense is Florida’s adverse possession laws so what she did may in fact not be criminal. So it’s slanderous for you to portray her as a convicted criminal. Far from being criminal, squatters’ rights have a long history in English Common Law (from which Canadian and American legal systems are based) that goes back centuries. The notion that the people who are occupying,… Read more »
Q
Guest
Q
3 years 7 months ago
I think Chicago is going to have a hard time loving Canada pretty soon. The first four items on this list are about to disappear: “Other reasons Chicago admires Canada: -Our banks are stable. -The housing market “never went pop.” -Debt and spending have been kept at more reasonable levels. -The “gold-rush-style energy boom.” -The loonie trades at par with the U.S. dollar. -Prime Minister Stephen Harper’s “ambitious trade agenda.” (However, the editorial notes that many Americans have never heard of him). – Half of the Chicago Blackhawks are Canadian. “Land of the north, Chicago is calling to you,” the… Read more »
RFM
Guest
RFM
3 years 7 months ago

For links to all of Ben’s recent presentations, go to:

http://vancouverpeak.com/Thread-Ben-Rabidoux-says

Democrass
Guest
Democrass
3 years 7 months ago
Here is Garth Turner’s take on what is happening in Vancouver (BC) right now: What’s happening now in BC is the slow-mo correction this blog’s warned about for a few years. It won’t follow the US shock-and-awe model of 70% craterings within a year or two. There will not be millions of foreclosures, or weekly auctions of unwanted homes on the courthouse steps. Rather, sales slide a bit, then slide a lot. Prices flatline before easing lower in a long and cascading arc with an unknown bottom. Local real estate boards will do all they can – as they are… Read more »
Anonymous
Guest
Anonymous
3 years 7 months ago
RealtyCheck re Buying houses in Surrey 1. So why were you not buying them 9 years ago when they were at that price? 2. The reason why people like you can’t buy these properties on the way down to support prices is because you are already ‘all in’ on real estate. As your equity evaporates and goes negative with your current holdings you would not be able to get financing to buy more. 3. I doubt you can get $3000 per month rent on a property valued today at 600k in Surrey. Maybe $2500 minus expenses you may net 2k… Read more »
RaggedyRenter
Member
RaggedyRenter
3 years 7 months ago
Short'em High
Guest
Short'em High
3 years 7 months ago

@Q: http://en.wikipedia.org/wiki/Squatting#Canada

What is BC law on that one? What is the BC Provincial limitation to register a claim to abandoned property with the Land Title Office?

A web site listing unoccupied foreign owned properties would also be interesting. Homeless people could consult this list. They need a place to stay and the owners obviously aren’t using the place…

BTW, did any property from the last unpaid property tax sale role ultimately change hands?

phiscal.
Guest
phiscal.
3 years 7 months ago

A request for the knife-catchers buying on the way down:

When you do your renos, please use a slightly better grade of laminate and go with clean classic fixtures. Since it’s all borrowed money and you’re going to lose it all anyways, the future buyer might as well get a place that has decent renos and doesn’t need 99 cent laminate torn out and thrown away.

Thanks!

Q
Guest
Q
3 years 7 months ago
On the Florida woman claiming adverse possession of her neighbour’s foreclosed property: The reason I linked to that story isn’t simply because I find it amusing that a humble lady can throw up her finger to the system and may get away with it. This isn’t just a one-off story. There have been several stories in recent weeks, profiled on Zero Hedge, about people in Florida using adverse possession laws to lay claim to foreclosed, vacant real estate. This is part of a growing trend in the USA and it speaks to a huge vulnerability in US property rights system… Read more »
Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
3 years 7 months ago

@Short’em High

Personally, I would love to see Vancouver go Mad Max. I have a fire arms licence and a gun collection so I’m hedged. I wonder how many bears can say the same 😀

Short'em High
Guest
Short'em High
3 years 7 months ago

@Bull! Bull! Bull!

Please do tell. What model(s) of weapons are registered in your real name…

Best place on meth
Guest
Best place on meth
3 years 7 months ago

You can get $1500 for a Surrey basement?

They why are they all around $500 – $900 on Craigslist?

Entire houses are going for less than $1500 because IT’S FUCKING SURREY!

http://vancouver.en.craigslist.ca/search/apa/rds?zoomToPosting=&altView=&query=surrey+basement&srchType=A&minAsk=&maxAsk=&bedrooms=

space889
Member
space889
3 years 7 months ago
@Q Or maybe they can just buy the house at market price if they don’t like how the current property owner is treating the property and not breaking any laws. Seems to me this adverse possession law was used to justify stealing land from natives during colonization of Americas, and is now being used by people who sees an opportunity to make a quick buck at the expense of others/society in general. These people aren’t doing it out of necessity, societal good, altruism, etc, they are doing it purely out of greed 90% of the time. If anyone think this… Read more »
Short'em High
Guest
Short'em High
3 years 7 months ago

@space889

Use it or lose it. Nobody is taking your property if somebody lives there.

AG Sage
Member
3 years 7 months ago
Q, Democrass, I think this woman could have played this smarter. I’d have put the rent into some kind of trust to cover expenses, or not charged rent at all, just made the renters sign an agreement to keep the place up. If that’s all she’s looking for is to have the place lived in. Banks should not be allowed to mess around, leaving empty houses to rot, year after year after year, the threat of this kind of adverse possession will hopefully make them think twice next time before the bank CEO writes himself a nice fat quarterly bonus… Read more »
VMD
Member
3 years 7 months ago

Vancouver’s new searchable Rental Standards Database
“The City publishes the Rental Standards database to:
Motivate property owners and landlords to keep their properties in good order for renters
Help renters make more informed decisions about where they live”

http://www.vancouversun.com/news/metro/city+Vancouver+database+lists+problem+rental+buildings/7927154/story.html

logic
Guest
logic
3 years 7 months ago

– Half of the Chicago Blackhawks are Canadian.

***************

Really? That impresses them? Really?

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
3 years 7 months ago

@Short’em High

glock 17, ar-15, ruger 10/22, remington 870.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
3 years 7 months ago

“Really? That impresses them? Really?”

really? really? yes really. shut the fuck up, you type like a teenager.

LocustLand
Guest
LocustLand
3 years 7 months ago

@LocustLand, @Groundhog

“personal abuse doesn’t advance your argument.”

My post was really just a general statement and not necessarily directed at any one poster. But thanks for stepping up. Way to take ownership of abuse!

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
3 years 7 months ago

@LocustLand

reduce the drama. are you a chick or something?

Best place on meth
Guest
Best place on meth
3 years 7 months ago

@Bull! Bull! Bull!

Somebody’s getting testy!

9 straight months of price declines will do that to a Bull! Bull! Bull!

Anonymous
Guest
Anonymous
3 years 7 months ago

VHB is laughing his ass off to the bank as he signed the second mortgage term with record low interest rate. Meanwhile, he feels so sorry to the his silly bear followers that he spares a minute here and there to comfort them. Good on you, VHB.

UBC in crisis mode
Guest
UBC in crisis mode
3 years 7 months ago

Still dreaming:

Van West, relisted for $19,680,000
List in June, 2011 for $19,990,000, only 1.6% drop after more than a year:

http://www.realtylink.org/prop_search/Detail.cfm?MLS=V988781&REBoards=All&From=MLS

Anonymous
Guest
Anonymous
3 years 7 months ago

Honestly, I wouldn’t pay $1500 for a basement suite even if it was in Vancouver, never mind Surrey. In Vancouver, I don’t think basement suites should be more than $1000 and the $800-$900 range is probably more reasonable. In Surrey, I would knock that down to $500 – $700 for a basement suite. You can rent entire houses in Surrey for $1500.

Group masterbator
Guest
Group masterbator
3 years 7 months ago

I wouldn’t even pay $150 for a basement suite in surrey!

Ban Bull! Bull! Bull!
Guest
Ban Bull! Bull! Bull!
3 years 7 months ago

Hey VCI admin I think it is time for an IP ban on Bull! Bull! Bull!. He is here as a troll only and just repeats the same “bears are always wrong” BS over and over again. Six posts today that add nothing to the forum.

b5baxter
Member
3 years 7 months ago

New inventory graph:
http://vancouverpeak.com/Thread-Inventory-Graphs?pid=401#pid401

Over the last 30 days the average daily increase was:
73
At this rate we would reach 15,000 in 8 days (Feb-15-13)
At this rate we would reach 20,000 in 77 days (Apr-25-13)
and 25,000 by July 2, 2013
Thanks PaulB for the numbers!

Buffates
Guest
Buffates
3 years 7 months ago

This market is going to get so bad so fast I think it will even surprise most bears. If this continues by the time the fall market comes there will be absolute shock and panic in this city. I fear for the local economy when values continue to go down. Disposable income will be a thing of the past.

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