Friday Free-For-All!

It’s that time of the week again…

Friday Free-for-all time!

This is 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:

The bank will pay your mortgage
The illusion of equity
More cutting by Poloz?
Bubbles and crying wolf
The kids are all right
HSBC stops some china US mortgages
Prices up beyond wages

So what are you seeing out there? Post your news links, thoughts and anecdotes in the comments section below and have an excellent weekend!

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southseacompany
Member
southseacompany

Another country goes negative;
“BOJ stuns markets with surprise move to negative interest rates” Reuters

http://ca.reuters.com/article/businessNews/idCAKCN0V70A7

” The Bank of Japan unexpectedly cut a benchmark interest rate below zero on Friday, stunning investors with another bold move to stimulate the economy as volatile markets and slowing global growth threaten its efforts to overcome deflation.”

space889
Member
space889

Because clearly after 2 decades of ZIRP and an economy chronically stuck in recession/borderline depression, the obviously glaring problem is that the interest rate is not low enough. Yeap! That is the only cause of the problems in Japan. No possible other causes…

crabman
Guest
crabman

Japan relies on exports. Their problem is a neighbouring communist, polluted, corrupt craphole undercut them.

space889
Member
space889

Is Japan and China even exporting the same thing? I’m not aware that Japan aims to be a WalMart supplier. How about South Korea? They are even closer to China and yet don’t have Japanese disease.

And how about Germany, which was the biggest exporter in the world until a few years ago? Their export sector is almost 40% of GDP and they don’t seem to have as much an issue competing with China.

southseacompany
Member
southseacompany

“Calgary real estate market now has ‘strong’ evidence of problems: CMHC”, CBC News

http://www.cbc.ca/news/canada/calgary/calgary-real-estate-cmhc-q1-assessment-2016-1.3422069

“CMHC economist Bob Dugan said evidence of overbuilding has increased since the previous assessment in Calgary and this could lead to lower prices.”

Dave
Member

That CMHC report says Vancouver has weak evidence of overvaluation while Toronto is high. Vancouver should at least be moderate, if not high.

Dave
Member

I meant ‘overall’, not overvaluation, which they gave a moderate. They are saying that overall Vancouver has weak evidence of problematic conditions. Half of the SFH have been bought up by foreign money and the vast majority of people can’t afford to buy a house in the City. How’s that not a problematic condition?

patriotz
Member

Perhaps “problematic” for them means likely to result in falling prices.

Anyway I don’t believe that “Half of the SFH have been bought up by foreign money”, however you want to define “foreign money”. Half of the SFH sales in CoV over the last few years, perhaps.

vangrl
Member
vangrl

and 75% of all luxury Condos

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

inner suburb townhouses and skyboxes are still affordable. their is no point looking at single family houses. those are just a dream for the majority of COCs.

Bull! Bull! Bull! Says:
November 25th, 2014 at 11:27 am 58
HAMs buy detached houses.

COCs buy condos and townhouses.

space889
Member
space889

Cambie Corridor and Marine Drive condos are selling for over $700/sq ft. A 1000 sq ft condo that used to be considered to be minimum size for a family of 3 or 4 is now close to $800K. Regardless of which value you use for median/average family income – $80K to $120K, the price to income is over 6x. That’s not really affordable. Even if you believe every family has $200K+ down payment from inheritances, saving, or 2 1br condos before marriage, the mortgage itself is still about 5x income or more.

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

cambie corridor and marine drive aren’t the inner suburbs.

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

are central banks out of tricks to stop deflation? nope.

minimum income is going to start being proposed as an option.

space889
Member
space889

Isn’t Denmark or one of those Nordic country planning to try that out??

The question is, if I can get say $20K just lying around the house, what incentive is there for me to go out and get legal taxable income, if my best job prospect is only going to be about $35K/yr in income??

Now, if I can make $100K+ in income then I’m likely in demand, so what incentive is there for me to stay here and paying taxes so lazy morons can stay in their parent’s basements, make $20K/yr posting comments bitching about house prices and how it is all evil bad Chinese people’s fault?

Yunak
Member
Yunak
I am quite shocked to see how such offensive if not racist interrogation could be conducted in Vancouver with offshore investor and other reputable people involved in this quite normal and legal business transaction? Before Wei was interviewed in June 2015, an investigator met with Zhang, who had come to Vancouver with her lawyer because her BMO account was frozen. Zhang could not shed light on reasons for the repeated false claims made in Canadian bank documentation. She was asked why she claimed Canada as her residence when opening a BMO account. “I don’t remember. Perhaps at the time the bank clerk suggested that to put the Canada down,” Zhang answered. Park Royal BMO management did not respond to questions from The Province on this story. Zhang was also asked by a BCSC investigator why she claimed her realtor’s Burnaby… Read more »
space889
Member
space889

Maybe not calling her a locust helped?

Oh I keep forgetting, if you are only targeting people based on ethnicity and geographical region, then you are not a racist!

Brian Ripley
Guest

re: Prices up beyond wages

I have updated my Demographia charts (related to Canadian cities) with their latest 2015 data:
http://www.chpc.biz/demographia.html

The big 6 Canadian cities’ Price to Earnings ratios came in at:
Vancouver 10.8
Toronto 6.7
Montreal 4.9
Calgary 4.2
Edmonton 4.0
Ottawa 3.7

Last year Vancouver was 2nd most unaffordable city after Hong Kong, and now Sydney AU has taken that spot with Vancouver taking 3rd spot.

Victoria still remains more unaffordable than Toronto and Kelowna and if you want to live in the most affordable cities in Canada, you are looking at Moncton or Saint John NB (similar income to Vancouver and Victoria, but the median housing cost is under $200k

Shut It Down Already
Guest
Shut It Down Already

Price-to-earnings doesn’t directly account for interest rates over the years. Higher prices are, by definition, more affordable (for a constant income) when interest rates drop. Cue patriotz.

Oracle
Guest
Oracle

The reason for negative rates is the rich don’t want their RE, stocks, or bonds to go down in value. So negative rates will suck money out from workers who have saved.

Until the working class wakes up and does sonething about it, they will continue to rape them.

crabman
Guest
crabman

The working-class has more savings than the wealthy?! Interesting logic.

wwww
Guest
wwww

A greater percent of their net worth is most defiantly in cash and not in stocks or bonds. The lucky ones own a house. crabman, are you one of the lucky ones?

Liarsstrike
Member
Liarsstrike

It is the poor who will indeed get hurt the most. Negative rates will take from the poor via higher food prices and give to the asset rich. A very destabilizing proposition for our society.

Oracle
Guest
Oracle

Dave:

Vancouver prices won’t go down. Too much foreign money coming in via Chinese students now. Soon they will be able to get their PR in under a month.

That’s why they are buying.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!
i’ve spoke about the phenomenon of mainland chinese and how they enjoy hunting and the outdoors, much more than previous waves of chinese immigrants. here is another example (guy in the story isn’t a poacher). once again, i’m ahead of the curve. On the poacher patrol: In search of Metro Vancouver’s illegal urban hunters Language can sometimes be an issue. “There’s a change in the profile of the hunters, more diversity, and urban people who are interested in harvesting wild animals for healthy reasons,” Gravel explains. The officers check a hunter launching his aluminum boat — decked in camouflage colours, right down to the outboard motor — at Wellington Point Park on River Road near Ladner. Businessman David Ou of Vancouver apologizes for his poor English but says he manufactures blue jeans in Guangzhou (Canton), China, and enjoys hunting, staying… Read more »
Yunak
Member
Yunak
This is positive and progressive cultural advancement in the city. We all must have to get used to it and reduce unnecessary policing and sanctioning those progressive and valuable habits and customs. For example that man at pool who confronted those nice people who were spitting wherever they could. “After witnessing people brazenly flouting the rules, Clackson said he confronted a pair of men and asked them to stop their unsanitary behavior. “They got really confrontational and thought they were being picked on,” Clackson told the News. “One guy said, ‘I’ve got a cold, that’s why I’m spitting it up.’” What was he thinking? Instead of encouraging them to spit even more and help community to further increase the value of land and property in the city he is making them possibly to feel unconformable, not right and not acceptable.… Read more »
joe
Guest
joe

I recently witness a mainland chinese letting his child pee on the side of the pool and the lifeguard is not doing anything about it. It could have been worst for them to pee in the pool. That’s why I am not swimming in pools with a lot of mainland chinese.

space889
Member
space889

Maybe they should add hunting team BPOM to the list…that’s a more fun, challenging, and fulfilling hunting than shooting a bunch of ducks who can’t even recognize that they are being hunted and shot at.

VanRant
Member
VanRant
For the Beijing politburo, halting capital outflows is becoming a matter of life or death, because there are only so many liquid reserves China can liquidate before it enters dangerous territory; worse, the less the reserves, the greater the desire will be on behalf of the local population to take their money and run. Of course, China’s rabid defense of further capital outflows means that its original intent, to devalue the Yuan to a degree that boosts its economy via exports, has been put on hiatus, or in other words China is trapped, and instead of an external rebalancing it is forced to boost its economy in the one way it knows best: by issuing ever more debt. However, with China’s total debt now estimated at 350% of GDP, it only has a finite amount of time before the debt… Read more »
Yunak
Member
Yunak

This is why here is different, and Vancouver doesn’t have such problem of prices going down. “Aafordability???” (what is that?) and instead of first-time local homebuyers Vancouver has infinite supply of of the foreign-first-time homebuyers and also suficient supply of all-other-second-third-fourth…fifteenth-time homebuyers either local or foreign therefore can run this shit forever…

“There are two things needed for home prices to go higher: there must be demand from buyers (especially first-time homebuyers) and homes must be affordable for consumers. As it stands, both of these factors are working against the housing market and housing prices.

http://www.profitconfidential.com/economy/housing-market-why-home-prices-will-fall-in-2016/?google_editors_picks=true

bestplaceonearth
Guest
bestplaceonearth

this kind of info is dime a hundred. your time is better spent watching peter russell.

would-be-buyer
Guest
would-be-buyer
Liarsstrike
Member
Liarsstrike

Hong Kong is tied to US monetary policy so financial conditions are getting tighter. In Vancouver, we are tied to the Bank of Canada which is determined to follow the ECB and BoJ it seems into negative interest rates. That said, household formation in China has peaked so that could be a medium term headwind for both Hong Kong and Vancouver.

ILoveCharts
Guest
ILoveCharts

Two questions for you guys:

1) After waiting for years, I’m thinking of giving up and buying a house in Squamish. Horrible decision or are is that far enough from Vancouver to be sane?

2) I’m sitting on some USD that I want to put into CAD. Some chores got in the way of me doing it last week and then it had an amazing rally this week. Hold out long or do it now?

Whistler or Bust?
Guest

1. Hard to go wrong with Squamish if you are buying because you like the outdoors. I think there is some upside there especially if the new mountain gets approved.
2. Do what everyone isn’t doing. 11/10 currency forecasters say the C$ is going to $0.65 or lower. When everyone agrees, everyone is wrong.

bestplaceonearth
Guest
bestplaceonearth

you ask the very people who missed the run-up for 10 years for housing idea?

crabman
Guest
crabman

Do you really want to live in Squamish? If not, keep renting. If you can, leave the lower mainland altogether.

would-be-buyer
Guest
would-be-buyer
@ilovecharts I am with you as well. I am debating buying something this year, but haven’t decided where. I have waited for 6 years for this market to correct and in the interim prices have only skyrocketed. I don’t know what will stop this market. I am a professional making mid 6 figures and I am priced out. I don’t have $300K to put down on an average east Vancouver house. I am only able to save from my INCOME, while paying rent and daycare etc. My family and friends have made six figures just owning homes and have (by all accounts) very affluent lifestyles: expensive cars, vacations and renos. This market is fucked beyond belief. I can’t leave Vancouver, because my head office is here. I may buy on the Island or Interior and hope to retire there. Who… Read more »
bestplaceonearth
Guest
bestplaceonearth

are you serious, or you just want to poke the bears?

GreenSalad
Guest
GreenSalad

This Charming All Brick Tudor Has A Formal Dining Rm, Formal Lr W/ Fpl, Eat-In-Kitchen. 4 Bdrms, 3 Baths, Wood Floors, Full Finished Bsmt W/ Spring Kitchen, Family Room, Laundry Rm. Close To Transportation And Shopping.
http://www.realtor.com/realestateandhomes-detail/4682-188th-St_Flushing_NY_11358_M45605-39045

What less than a Mil will buy you in NY…..true our $ has fallen but wasn’t that long ago we were at par…..I personally think we are seriously hooped here…..In my opinion, if I had Chinese mainlander type cash, I know where I’d be shopping…..

Shut It Down Already
Guest
Shut It Down Already

Why do you have to buy a SFH as your first property? Most people buying those have the large downpayment required because they’ve built equity on a smaller place first.

Always makes me laugh when the Bears here conclude locals can’t afford houses because they’re assuming that every market participant is a first time buyer, or that SFH is the only property type.

Liarsstrike
Member
Liarsstrike

Trading up hasn’t worked in the past few years if you started off buying a local condo. At best you trade off a longer commute for bigger space and more debt. Of course, trading up from a New York or Chinese property is a different story thanks to our sinking loonie.

crabman
Guest
crabman

Why should he be able to buy an SFH? Because he makes “mid six figures” you dipshit. Show me one other mid-sized city where that’s the case.

Whistler or Bust?
Guest

Beat it troll.

Shut It Down Already
Guest
Shut It Down Already

Sound counter-argument. Well played.

paulb
Member

New
151
Sold
140

TI:7441

For weekly sales and/or new listings info on a specific neighbourhood/city of your interest, email me and I will customize a weekly update for you. The daily sales numbers only mean so much. Each neighbourhod and market segment can be quite different.

Cheers!

http://www.paulboenisch.com

Yunak
Member
Yunak

The future is anything but bright for the city of Vancouver with all these capable and smart business people, their connections and wealth from offshore base. No wonder why they call it the best place on earth…

https://www.baytoday.ca/business/bc-residents-accused-of-60-million-fraud-involving-company-with-no-employees-191430

southseacompany
Member
southseacompany

“Canada’s Real Estate Problem: Canada’s Real Estate Problem
Relying on a frothy real estate market.”, Bloomberg

http://www.bloomberg.com/news/articles/2016-01-29/canada-s-one-legged-stool-economy

“The Canadian economy was largely stagnant through the first 11 months of last year, shrinking by 0.09 percent. In light of the collapse in oil prices, however, things could have been worse. But the relative resilience of headline growth belies the extent to which the economy is now being supported by one sector: real estate.”

Whistler or Bust?
Guest

Ho Hum –
http://www.theglobeandmail.com/news/british-columbia/officials-concerned-homebuyers-unaware-of-real-estate-risks/article28471686/

Interesting shout out to Vancouver Condo Info in the article but the link goes to a different site.

patriotz
Member

This is apparently a US website that is inserting contact info for local realtors, in this case Sutton Group. Topics such as PMI indicate US origin. Google the first paragraph and you will see similar websites.

I think the reporter simply made a mistake.

Dinnertime
Guest
Dinnertime

Bula reads this site, so it’s most likely an editor ‘corrected’ it to add the dot com.

vangrl
Member
vangrl

ya I posted the comment in October, she obviously read it. I also took a crap load of screenshots from Julia’s page. Crazy they are saying she was never an employee. She had posts saying she was VP of the company.

UBC in Crisis Mode
Guest
UBC in Crisis Mode

“Among the commercial sales that have raised eyebrows is the Molson brewery site in Kitsilano, assessed at $43.7-million. But a source confirmed to The Globe and Mail it has sold for $190-million.”
Sun Commercial is crazy to think they can make money buying this site. Scam has to be involved.

would-be-buyer
Guest
would-be-buyer
patriotz
Member

I’ve heard something like that before – from Harper during the election.

The provincial government will pay for an external study

I wonder who will be doing that.
The provincial government is committed to using all possible means to keep RE prices high. Whatever this “external study” comes back with, that will not change.

UBC in Crisis Mode
Guest
UBC in Crisis Mode
YLTNboomerang
Member

So why do you think they are selling it partially finished? Possible reasons I can think of:
1. Builder is going under
2. Builder is frightened the market is turning and wants out before any further investment
3. Original buyer bailed for whatever reason, perhaps worried market is turning on a flip.

On a different note regarding “no foreign ownership issue here” topic, check out the comments page of the realtor’s website including where his client is from, not a lot of lower mainlanders:

http://gloryhomes.ca/testimonials.php?lang=en

16 our of 19 testimonials are from offshore buyers for those who don’t want to see for themselves

patriotz
Member

According to the first two Chinese language testimonials I translated, the buyers are immigrants (including “William from Beijing” who immigrated in 2006). Anyone with the time to translate them all is welcome to make a tally.

YLTNboomerang
Member

By immigrated you mean came over, bought a house, then went back to China to earn an income right? She signed it Cindy(from Guangzhou)not Cindy (from Vancouver).

VanRant
Member
VanRant

Just had dinner with a mid level big 5 banker and she said this year will be a very bad year for Vancouver Real Estate cause the Chinese government is now blocking all money from
China that is destine for the off-shore Real Estate Markets.

wwww
Guest
wwww

They were always attempting to block the money and the money always came through.

Shut It Down Already
Guest
Shut It Down Already

You’d think somebody with access to some of the pertinent market data would understand that the majority of purchases are LOCALS.

tedeastside
Member
tedeastside

UBC its worth it, this house is only a 5 minute walk from Mcdonalds

talk about convenient

wwwww
Guest
wwwww
bestplaceonearth
Guest
bestplaceonearth

just had brunch with a friend, who is on the top management level of one of the big five banks. he said, if you think the van RE price is to expensive now, you haven’t seen any thing yet.
take it for what it is worth.
the phrase “buy now or be priced out forever” is so true.

Whistler or Bust?
Guest

That is hilarious. You are taking advice from someone who has a vested interest in the bubble continuing to inflate.

The top is in.

Turist
Guest
Turist

The asshole is troll, a spacefuck 5-cent- party buddy. Top management level level of one of the big five banks, brunch… Shitload of crap, what a delusional moron…

Shut It Down Already
Guest
Shut It Down Already

Brave man calling the top when interest rates might yet go lower and inventory is at its lowest in a decade. Do you genuinely believe it or are you just being argumentative?

Whistler or Bust?
Guest

As I posed here a week or so ago. I think between now and the next 3-6 months will mark a very long term top for Vancouver RE. I base this on several things but mainly that the dirty Asian Money (I am trademarking that by the way – no more HAM. DAM is the new lexicon) Is drying up faster than people think. This market has to be able to stand on its own fundamentals and I think we passed that in 2005. When it pops it’s going to be far worse than ever the most ardent bear can imagine. I am more convinced of it with each passing day.

So no SIDA I am not being argumentative.

YLTNboomerang
Member

So you were in Toronto having lunch?

vangrl
Member
vangrl
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