FFFA! Inventory, History, Taxes and Hype!

Hey, It’s the end of another work week in the province formerly known as the best place on earth!

Let’s do our regular end of the week news round up and open topic discussion thread for the weekend.

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

Inventory chart updated
Found a clue!
Bidding wars in a slump?
Historical price/rent to ’84
EA closing vancouver studios
Loophole for the PTT
The Hong Kong tax treaty
Canada vs US fundamentals
Ready for the next global slowdown?
Island foreclosures
Silverstoned

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

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VT
Guest
VT
auric goldfinger
Guest
auric goldfinger
auric goldfinger
Guest
auric goldfinger

You can give Tsur Somerville and Cameron Muir a run
for their money.

https://www.youtube.com/watch?v=XWtNuAgiybA

CanuckDownUnder
Member
CanuckDownUnder

CRA must be serious about cracking down on speculators. A friend of mine just posted on Facebook looking for a good tax lawyer, he’s being audited over a condo he recently sold in Toronto. One of the follow up comments was from someone who knows another person going through the same process, the auditors must be out in full force in Toronto.

patriotz
Member

“A friend of mine just posted on Facebook looking for a good tax lawyer, he’s being audited over a condo he recently sold in Toronto.”

So the idiot is going to pay a lawyer to fight an unwinnable case? Good.

The time to hire a tax lawyer, or accountant, is before you incur a tax liability, not after.

Some Guy
Guest
Some Guy

@2 auric

I don’t read the Post so I had missed the comedy of Black’s article from last month, so thanks.

I guess with the Post continuing to publish the deluded ravings of convicted felon Conrad Black and repeated plagiarist Margaret Wente still writing away for the Globe, it’s a mystery why newspapers are failing!

RFM
Guest
RFM
Ripples in the pond………… Yesterday, I talked to a lawyer friend of mine whose office exclusively handles real estate closings. He’s been in business a long time and has a varied and deep clientele. I asked him how the downturn in sales has affected them. His answer: they have done away with the receptionist position. All their paralegals and legal assistants have been on part time status for many months. They work 3 days a week, for which he pays, and get 2 days a week unemployment benefits. According to him, this is a plan to save jobs by recognizing that if he laid off part of his staff, the government would pay full unemployment compensation to them, so it’s better to pay partial benefits for more people. He mentioned that the benefits will end fairly soon. I asked what… Read more »
Bo Xilai
Member
Bo Xilai

Quelle Surprise! Kevin Falcon is joining Anthem Capital..

http://dcnonl.com/nw/33611/re

I guess it’s for past service to the real estate development and sales industries.

Politicians whore themselves for real estate developers and then cash in their chips. No wonder BC voters are so disillusioned by politics in this province.

Anonymous
Guest
Anonymous

May Flowers almost here…still no correction in SFD <$750,000!

When? In 2014? 2015? 2020?

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@RFM

> But, I think we will not see the full effect until 2015, when failure to commence new projects by major developers will whop the market for good.
Stay tuned.

I thought 2009 was the year of the crash. Then it was supposed to be 2012. Then people said 2013. Now it’s 2015?

Short'em High
Guest
Short'em High
@#9,@#10. There are 17640 active listings in the Lower Mainlaind. If the crash is just hype, show us the way. Out of 17640 listings, what should people be buying and please lead by example. Which properties are you buying and how much rent are you getting for them? What financing is available these days? Is 20x leverage still available? When will Vancouver property make a new high? How can one avoid the new CRA audits and capital tax? So many questions but all you seem to know is that a crash didn’t happen today. Are you making a prediction that there will never be a crash? Are you saying that RE isn’t risky? Is it a little risky or no risk at all like a bank account? What information are you providing by posting every day “no crash yet”? I… Read more »
CullBull
Guest
CullBull
“So many questions but all you seem to know is that a crash didn’t happen today” So many questions, indeed. Here is a clear answer. There will never be a crash. This is the second year of very crappy sales but prices have not fallen in any meaningful way. Not enough to make it worth waiting. This is reality. Two years of horrible sales and no real price movement. If this trend continues for another year or even three years, it will not be worth the wait. You’ll be waiting 5 years for a 15% decline in prices. Your 1,000,000 East Van dump can be had for $850,000 after five years. Meanwhile, if you buy now inflation will have reduced your debt burden by 7-10% in five years. Look at Ben’s post from yesterday. He doesn’t even think a crash… Read more »
Not much of a name...
Member
Not much of a name...

@Short’em

One word…trolls. Ignore them. No need wasting time and energy on them.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@Short’em High

> There are 17640 active listings in the Lower Mainlaind.

slightly higher inventory than last year, and there was no crash last year.

>So many questions but all you seem to know is that a crash didn’t happen today.

didn’t happen in 2008/2009, 2012, and isn’t happening in 2013. what part of that don’t you understand?

there is nothing exceptional about the current market conditions. we’ve been here before and prices have gone UP! UP! UP!! AND AWAY!!!

soar like So many questions but all you seem to know is that a crash didn’t happen today.

stop being so pesamistic. what has it ever gotten you? be positive, look for opertunities, fly like an eagle.

Anonymous
Guest
Anonymous

Wow. Call us trolls?

I want prices to go down too. But u guys have to take off those doomer glasses too and face reality.

Nothing in my area of North Delta has seen any price declines whatsoever! Prove me wrong. I’d like that.

Turkey
Guest
Turkey

@CullBull,

Ben’s comment says he’s not counting on a 20% y/y decline in the Teranet composite 11. If that happened, it would indicate an abrupt, simultaneous, and devastating collapse of the nationwide real-estate market. It takes a special kind of logic to confuse “I don’t see that happening” with “the Vancouver market is healthy.”

Some Guy
Guest
Some Guy

@12 “You’ll be waiting 5 years for a 15% decline in prices. Your 1,000,000 East Van dump can be had for $850,000 after five years. Meanwhile, if you buy now inflation will have reduced your debt burden by 7-10% in five years”

Wow if that’s the bull argument, I’d hate to see the bear argument!

Yes, you too can lose $150,000 simply by buying a house (never mind the additional cost of owning vs. renting). But don’t worry, that nominal loss of 15% is actually a real loss of 25%, so it’s all good!

Many Franks
Guest
Active Member
Many Franks

CullBull:

Here is a clear answer. There will never be a crash.

That’s pretty unambiguous. Can you state just as explicitly what your definition of a crash is?

My prediction: CullBull will be a short-lived screen name around here.

Short'em High
Guest
Short'em High
@#12. You’re conflating a few things. Inflation, ONLY IF priced into wages would deflate the debt burden from a loan taken out today. But, it remains to be seen that wages are tracking inflation or are even a reliable form income going forward. That last unemployment report showed a massive increase in unemployment especially in Vancouver. Also, if 2% inflation is reliable then why are house prices falling 15%? Also, what if deflation takes hold? And you need to explain what YOU are buying. Or, if you are not buying, why not? Are you a realtor serving your own interests by encouraging people to take on excessive risk so that you can make money on transactions? You were very quick to gloss over those wage, unemployment, and deflation risks to name just a few.
patriotz
Member

@#19. You’re missing the main point, which is that it doesn’t make sense to buy a house today for $1 mil if you can buy it later for $850K, reagardless of how much inflation there is or whether wages track inflation.

Of course it may not make sense to buy it later for $850K either.

UBC in crisis mode
Guest
UBC in crisis mode

Too many condos for sale in this UBC building (7 right now), and a new low.

New on the market, asking $598,000
assessed: $606,000

First time in recent years a 2-bed room condo in this building is below $600,000.

http://www.realtylink.org/prop_search/Detail.cfm?MLS=V1002898&REBoards=All&From=MLS

Short'em High
Guest
Short'em High

@#20. I’m just addressing the points raised one by one in case people who read this blog think these guys have any leg to stand on. Of course, and obviously, the main problem is why buy now when you can buy tomorrow for less. Absolutely.

And yes, they are trolls, but casual readers of this blog might be confused and think there is a bias here. I want to make sure casual readers understand there is no valid financial argument for buying Vancouver RE today, not even the mantra “no crash yet”. That one can easily be confused with the invalid inference no crash today therefore no crash tomorrow.

@UBC in crisis mode
Guest
@UBC in crisis mode

$4k under assessed! Now I see why UBC is in crisis mode!

Atomic Frog
Guest
Atomic Frog

@12

Owning a house means that you have to pay property tax/utilities/insurance as an added annual expenditures over 5 yrs. You can rent the basement out to recover some of that cost. However rent will be considered as taxable income, unless you evade income tax.

I honestly don’t see how a crash CANNOT happen here in Vancouver. It makes much more sense to rent now instead of buying into an asset that is falling in value.

Interest is not going up anytime soon, there is no incentive to buy now. I can always wait till 2015 and would still be able to enjoy the ultra-low mortgage rate. Meanwhile, I can put my money in stock, gold and other investment that are easier to move and ride the wave of the market.

Anonymous
Guest
Anonymous

My wife and I are noticing house listing prices drop by what would be an substantial percentage our yearly family net income, just this spring.

Sitting on the sidelines from 2003-2012 talking about how it was crazy to buy was hard. Sitting on the sidelines NOW is the easiest thing in the world to do.

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