Renting: The last, best real estate bargain?

Somebody at the Sun has started looking at rent / buy ratios.  

Many Franks posted this in the comment section yesterday:

Barbara Yaffe discovers renting. Contains a few groaners. Renting a place may be the last, best real estate bargain and a majority of the city’s residents are taking full advantage

Vancouver rents have remained reasonable in part because of a 2.2-per-cent limit on annual increases imposed by the provincial government.

NO! Bad Barbara.

In a recent bulletin, [David and Mark Goodman] report Canadian Mortgage and Housing Corporation numbers that demonstrate it’s 32.5-per-cent cheaper to rent rather than own a one-bedroom unit in Vancouver.

“The gap increases considerably once strata fees, maintenance costs and taxes are taken into account.”

WTF kind of buy/rent comparison EXCLUDES strata/maintenance and tax?

Apartment building owners in Vancouver since 2007 have faced a municipal moratorium on the demolition of rental housing stock, and are reluctant to evict tenants in order to do needed upgrades.

Renoviction. When a phenomenon is popular enough to coin its own term, “reluctant” might be overstating the case.

The Goodmans are predicting that landlords of these older, minimally upgraded buildings soon may find themselves confronting tough new competition.

They report as many as 49 rental buildings, with 5,849 suites, could come on stream in the region within the next three years.

And the popularity of renting in Metro Vancouver may grow, says the Goodman Report, because of an increasing wariness about Canada’s possibly overvalued real estate.

“We live in a very special place with abundant resources and continuing investment from abroad,” says the newsletter. But with all the housing-bubble talk, “as a B.C. real-estate owner you’re wise to be cautious.”

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The Real Deal
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The Real Deal
Vancouver isn’t experiencing immigration from Asian, Vancouver is feeling what it’s like to be on the short end of an economic arbitrage. Income tax in Asia is low, and the social safety net is weak. In Canada income tax is high, and the social safety net is strong. If you work in Asia, you can’t retire early because of the risks of having no income. However, if you take the money you made in Asian, you can come to Canada, retire early, and take advantage of the social programs here. Your children, can enjoy fresh air, cheap universities, and free healthcare. Then when it comes time for your children to work, they can do the same thing you did and go back to Asia to make money. Thousands of Chinese-Canadians lured back to Hong Kong by better job prospects than… Read more »
crabman
Guest
crabman

Whenever you see one of these stories in the media, they always ignore the obvious — prices are too high!

Why is renting so much cheaper than buying? Prices are too high!

Why are first-time home buyers having such a hard time coming up with a 5% down payment? Prices are too high!

Why is affordability so bad? Prices are too high!

King bob
Guest
King bob

The media always states prices are too high but rents are still very reasonable. This isn’t like San Francisco where people are getting evicted because they can’t pay rent. So if people can’t buy, what’s the big deal. Landlords are subsidizing the lifestyle of renters anyway in a market like this.

crikey
Guest
crikey

Spring has sprung, the grass is ris, I wonder where the sales data is?

VMD@work
Guest
VMD@work

While we wait for the official REBGV stats..
over at Real Estate Talks:

“too bad nobody told the mainlander who sold his house today on Dunbar for 2.35M… same house that he paid 2.72M in Jan 2012

$500k loss after PTT and commissions” (3421 W 22nd)

KK
Guest
KK

Wouldn’t official monthly sales states be out by now? Or am I ahead of myself?

UBC in crisis mode
Guest
UBC in crisis mode

I think REBGV’s numbers may be higher (NOT sure why though):

Van West Sales (March, 2014)
apartment/house/duplex
listing 643 259 100
sold 102 41 18
sold (Feb) 293 154 47

Bo Xilai
Guest
Bo Xilai

#4 VMD@work –

Not to mention currency losses between Renminbi and CDN$… OUCH!

yvr2zrh
Member
OK – A few things as the month is over but we await the final GVREB stats. 1.) We now see from Larry that avg. price is down a lot – pretty much 10% in one month. 2.) Seasonally adjusted sales are way down from Feb. MOI is likely up – this almost never happens. 3.) We will see how Van West Detached has done this month in terms of volume – FYI – Avg. over past 10 years is 180 last year is 150 and lowest since 2000 is 119 – – If we are below the lowest of the low – I think the Van Sun should do a proper story on this. 4.) The currency effect should not be ignored. Just spent a weekend with my inlaws in Scotland. They are White people who spent most of… Read more »
UBC in crisis mode
Guest
UBC in crisis mode

As our local media is unlikely to report reduced sales, I have suggested to Ian Young of South China Morning Post (Hong Kong) to take a closer look of recent housing market trends in Vancouver.

http://www.scmp.com/comment/blogs/article/1440792/immigration-property-prices-and-vancouver-experts-view

would-be buyer
Guest
would-be buyer

I find it interesting that detached SFH sales are up 18% YOY, according to Yattermatters. This, even though sales appear to have plummeted on the westside. Locals still appear to love their Vancouver real estate.

Bear Vancouverite
Guest
Bear Vancouverite

@UBC in crisis mode #6

That data is very encouraging. Can this really be a result of the announced IIP changes? One would think there’d be some lag time before it had an impact. Could other factors be at play? I like the theory that those who believe RE can only go up are losing faith due to fears of loss of HAM.

King bob
Guest
King bob

@wouldbe buyer

This is likely due to the fact that west side homes are largely unaffordable for people who are not already in the market. However, east side homes are still affordable for upper middle class folks if they can scrape together a dp.

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

>One would think there’d be some lag time before it had an impact.

why?

> I like the theory that those who believe RE can only go up are losing faith due to fears of loss of HAM.

you don’t think there’d be some lag before this had an impact?

King bob
Guest
King bob
I think the question is whether west side prices will come down or not and by how much. Hard to say whether the cancelation of the IIP will really play a role–it’s too early I think, but it could be that people have stopped buying. People may be rushing to the exits–but I think that will be because of a liquidity crunch in China, much like what is happening to HK real estate. the other interesting thing is all the condos that are going up. Our townhouse complex on westside was finished in 2011, and I just noticed another 6 units go on MLS for a total of 9 units for sale (1.3-1.6M) in a 35 unit complex. Behind us is another development that is not sold out but almost completed, and they have just demolished another several old houses… Read more »
Happy Renter
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Happy Renter

Landlord stopped by today to pick up rent cheque, she gave me free pair Canucks Tickets!!

Renting Rules

blah-blah-blah
Guest
blah-blah-blah

I love this guy, “Vancouver – the Most Affordable City”:

http://www.freedomthirtyfiveblog.com/2014/04/vancouver-most-affordable-city-in-canada.html

mac
Member
mac

Hate to break your little bear hearts but friend whose family is selling huge lot in most desirable corner of westside, still has, and has always had the same number of non-English speaking Mainlanders touring their place. No sale in over a year bc Mainlanders are moving away from developing and flipping and want to buy and hold.

They don’t see a difference with IIP cancellation. Only HAM looking at their property. But they ARE being told NOT to work with a white realtor if they want to make a sale with HAM. Howdya politically correct types like dem apples?

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

Anyone else notice how yvr2zrh and vmd are a lot more on the ball than VHB, patriotz, Jesse, crab man, etc.

mac
Member
mac

You guys always vote down something you don’t want to hear. I know it’s painful but this is what’s happening to West Side homes. Less HAM because housing is coming off a bit, they’re investing elsewhere but there’s still enough money coming from the Mainland to put a bid under SFHs westside.

Local hopes of owning a SFH westside are gone. Regardless of your race, nationality, etc. If your money is earned here, you can’t buy there. And the relentless bid from China ensures it barring a collapse in that country, you are only looking at a small decline in prices.

Let’s wait 7 months and see who’s right.

Deja Vu!
Guest
Deja Vu!

@15 “Landlord stopped by today to pick up rent cheque, she gave me free pair Canucks Tickets!!”

When she gives you tickets to see a team worth watching I’ll celebrate with you.

paulb
Member

New Listings 297
Price Changes 97
Sold Listings 119
TI:15211

http://www.paulboenisch.com

Heard Herd selling
Guest
Heard Herd selling

Club seats 🙂 with parking pass

George
Guest
George
@ Lifetime Renter #269 (previous thread): “Not all those buying high end real estate are non-white immigrants. Not all those speculating are Chinese.” I never said everyone who is buying high-end real estate is non-white immigrants and I never said all speculators are Chinese. Geez, one of the most frustrating aspects of the HAM debate is that for some people it has to be all or nothing. I am simply talking about the existence of wealthy real estate investors from China, but I am not saying **all** wealthy investors are from China. “And those who have gained by far the most, who are the real ‘oppressive capitalists’ in regard to this are the owners of the real estate and development industries and the banks – mostly Canadian of European origin.” Yes, I agree with that. I was acknowledging that capital… Read more »
Heard Herd selling
Guest
Heard Herd selling

I was at a priest convention today, rumor has it there has been a drastic uptike of real estate agents attending services . Pray for sales, pray for more hot balloon air,pray I can keep 3 series or C class, also noted were Westside homeowers, even some JW have been praying

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