BC, economy, opinion, prices

The negative side of overpriced real estate

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55 Comments

Over at MoneySense they have a list of 4 casualties of the Vancouver real estate market.

The first one isn’t really a negative though, it’s just people jumping into the market without any conditions or clauses and taking on the risks that entails. That only affects willing participants in the market.

The other 3 points affect everyone – Empty zombie neighborhoods, high rental prices and fewer options for local food.

…land prices in the rich and productive soils of the Fraser River delta have risen and now sell in the range of $80,000 to $110,000 per acre. While prices can drop for parcels of land greater than five acres, these price increases are setting off alarm bells, especially when paired with statistics from agricultural lender Farm Credit Canada that show that any land priced above $80,000 per acre makes farming unsustainable.

Read the full article here.

 

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[…] rate falls to 48 year low –Who’s at the open house? –How is Comox? –How is Kelowna? –Danger in the bond market […]

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squeak

“Canada Mortgage and Housing Corp. said it had flagged “moderate evidence of problematic conditions” in Vancouver’s housing market thanks to soaring prices that have far outstripped underlying economic fundamentals in the region.” Oh well, then we should not really be all that concerned. I would not be too worried about the “moderate problematic conditions”. It will be just fine. Meanwhile, of course, we are living in 2 different universes: the have a house class and the rest of the riff raff. As said before, the young talented bright riff raff and the honest taxpaying working riff raff will be better off in a province whose leader understands the value the “riff raff” is to a country/province. What ever little so called “affordable housing measures/plans/wishy washy thoughts/or whatever they want to call it, is nothing but a pitiful PR attempt. I… Read more »

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funky monkey

I am riff raff 35 years old, but my friend who is ten years older than me is not because he was able to buy a house at 35.

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Bear Vancouverite

Just a report from the trenches. I have begun studying listings and going to open houses. Last weekend I went to 8 open houses in the Vancouver area, some West side and some East side, in the $1.3-1.5M range. These are either SFH or Duplex/Triplex, some new builds. Here is my report: * the open houses are usually packed. Easily 6+ parties at each one when I arrived. * I didn’t see a single group or person I would term to be a foreign buyer. In fact, at least 50-60% are caucasian. My guess was a few were downsizing from even more expensive properties. So the theory that foreign buyers are mostly in the upper end seems to hold up so far. * I spoke to some of the younger buyers (all locals). One told me they had been trying… Read more »

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Hyper-mega-Bull

>West side and some East side, in the $1.3-1.5M range. These are either SFH or Duplex/Triplex, some new builds.

thanks for sharing your experiences. i would caution that you looking at a very thin slice of the market, so broad conclusions can’t be drawn.

what i mean is that the properties you are looking at are the low end. If it’s a detached house at that price you don’t even need to set foot in it because it’s lot value and will be torn down.

as for duplexes and triplexes, HAM isn’t interested.

but your observations show that COCs are buying in some segments.

duplex and triplex aren’t a great sell in a neutral or cold market, so the demand for these tells us the market is hot and COCs are desperate for table scraps.

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bullwhip29

your post makes no sense for a variety of reasons…. you claim 50-60% of open house attendees were caucasian, so who makes up the other 40-50%? not that this matters since many buyers don’t even bother going to open houses (esp if they are planning on knocking the house down in the first place). imho open houses are phony staged events designed to generate additional buzz much like lineups outside of nightclubs. the important point is that VIP’s dont need to show up or reserve a table and always get to look at everyone else’s cards before deciding on how (or if) they want to play. young buyers can’t afford anything in this price range as they dont have the income to service a $1M mortgage buyers that are showing up to every open house with an inspector are effectively… Read more »

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Bear Vancouverite

Well the other 40-50% appeared to be South East Asian or Indian to me. I did not see a single person speaking mandarin. again, this is the “low end” of the market so it seems to fit with assumptions that the high is where HAM plays. If you don’t care for open houses then you ignore a huge potential to understand what is going on. The rest of your post suggests you’re growing too cynical and too insulated in your thinking about the market. If all of us bears think like this we’ll be left in the dust of those who pay full attention. I also don’t know what you mean by VIPs and playing at cards. Agents in these open houses are making a real attempt to sell the places and if you made an offer yours would be… Read more »

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bullwhip29

that isnt a “bungalow”, this is (and it is a teardown) https://www.locatehomes.ca/bc-real-estate-listings/vancouver/mls-V1139172/3880-Slocan-Street-Vancouver-V5R1Y5?id=261959716 in due time any older home (even if it is renovated) will be knocked down and rebuilt to max out sqft w/ added coach home. no other way to get numbers even close to making sense for mortgage holder many highly desirable properties are sold to connected buyers before it hits mls or an open house even occurs. open houses (not unlike auctions) are generally for chumps and suckers who wind up letting their emotions get the best of them and pay more in the heat of the moment (not to mention forgoing common sense due diligence). if only people would spend half the time on getting their big picture financial matters in order than they do on getting the best price on gas or milk, we’d all… Read more »

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bullwhip29

Ringer realtor: Ryan Rana exam imposter unprecedented, says official
http://www.cbc.ca/news/canada/british-columbia/real-estate-imposter-cheating-licence-1.3554433

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space889

Obviously HAM fault too right? Totally all Chinese fault since locals never cheat! Ever!

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bullwhip29

chinese economic “miracle” largely the result of a closely connected few cutting any and all corners to get ahead and showing no regard whatsoever for standard laws, the environment and basic common sense. now that their homeland has been more or less reduced to a toxic waste dump in more ways than one, they (along with their spoiled rotten “don’t give a shit” offspring) are jumping ship and setting up shop in our neck of the woods and bringing along with them all their bad habits and toxic way of thinking. and all the backlash? why is this so hard to understand?

http://www.rcerm.eu/images/china-pollution4.jpg

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Nom Nom Nom

Sure they do, just not apparently as uniformly as HAM…

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bullwhip29

it is the gang banger in-your-face way they go about things that puts so many people off.

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bullwhip29

Globe and Mail: CMHC warns of ‘problematic conditions’ in frothy Vancouver housing market
http://license.icopyright.net/user/viewFreeUse.act?fuid=MjIzOTQxMzg%3D

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Zero Down Forty

This is like McDonald’s warning about the rate of cholesterol.

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Hyper-mega-Bull

DNA test ties two Richmond men to deer kill

Xiaojing Guo and Yong Li pleaded guilty to possession of dead wildlife and illegal hunting

http://www.richmond-news.com/news/dna-test-ties-two-richmond-men-to-deer-kill-1.2240291

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Hyper-mega-Bull

mainlanders love hunting and hate rules. this is just the tip of the iceberg.

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space889

So when immigrants adopts local hobbies you get pissed off too? There is no pleasing you people.

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HAMster

Kelowna overall rental vacancy rate sits at 0.7 percent, and the rate for three or more bedrooms is at 0 percent.

http://www.cbc.ca/news/canada/british-columbia/kelowna-rental-vacancies-1.3554304?cmp=rss

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southseacompany

“Vancouver housing market slows down in sales, but still sees strong price growth”, am730

http://www.am730.ca/syn/112/177230/vancouver-housing-market-slows-down-in-sales-but-still-sees-strong-price-growth

“The Conference Board of Canada says the time between February and March saw an increase in sales almost a third of the Metro housing markets across Canada. However, sales appear to be slowing in not only Toronto, but also in Vancouver.”

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patriotz

Christy Clark’s salary being topped up by donations to BC Liberal Party

Premier Christy Clark is paid tens of thousands of dollars each year by the BC Liberal Party – an income that is drawn from coffers infused by donor contributions and is in addition to the nearly $200,000 she earns annually as the head of government.

I have never heard before of any Canadian premier having their salary topped up by their party. Keep in mind taxpayers are paying most of this top up due to the credits for political donations.

Premier Christy Clark is paid tens of thousands of dollars each year by the BC Liberal Party – an income that is drawn from coffers infused by donor contributions and is in addition to the nearly $200,000 she earns annually as the head of government.

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Best place on meth

I can’t believe this corrupt piece of garbage is not in prison, her chinese friends have taught her well.

She must hate Eby for continuously exposing her corruption after defeating her in Point Grey.

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space889

Right, it is all HAM fault that local voters voted her back into power despite worse scandals than NDP.

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elvince

It was the case for Jean Charest in Quebec. He was paid 50k$/year by the QLP. But he is widely regarded as the most corrupt premier Quebec has ever had, so it’s not exactly a surprise that he and Christy are doing the same thing.

He had to give up his “income supplement” when it made the news. Not sure Chrsity will give up hers.

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southseacompany

“Lower interest rates could be the new normal: Bank of Canada”, Global news

http://globalnews.ca/news/2663240/lower-interest-rates-may-be-the-new-normal-bank-of-canada/

“Poloz told a Wall Street audience Tuesday that the fate of neutral rates – the levels he said will prevail once the world economy recovers – remain unknown, but they will almost certainly be lower than previously thought.”

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vangrl

This 1000 Sf.t Condo in Marpole was just listed for $946,800 a month ago. It had been listed for over 120 days. Did it sell and is now being flipped for a 40% profit in one month? or de-listed and re-listed at a 40% premium? Don’t think it was ever lived in by looking at old listing photos
https://www.locatehomes.ca/bc-real-estate-listings/vancouver/mls-R2062312/1005-8555-Granville-Street-Vancouver-V6P4Z9?id=262083939

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wwwww

I can’t answer your questions, but a few months ago all units in that building were typically listed at $1000 per square foot so it’s original price was in-line with the market and would have attracted offers if I was to guess.

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Bear Vancouverite

I know one case where the exact same size condos with a North view in that exact development is renting for around $2800/mo. Makes the sale price rather expensive.

However, my understanding now is that developers are needing to charge around $1100-1300/sq ft to make money on new builds due to the cost of buying the land. Homeowners are reluctant/scared to sell for fear of being priced out, and this has driven prices even higher.

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Comox?

What do you guys think of the Comox Valley? Has all the stuff that millennials and retirees love (ocean, mountains, golfing, farms, etc.) and it’s kind of hit a critical mass. Houses are still dirt cheap there.

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funky monkey

Comox is beautiful you have to be an outdoorsy type of person though.

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Guest

Jobs?

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Starving Artist

Every time I think of anywhere on the island, I always come back to dealing with the ferries, and that puts a damper on my enthusiasm.

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paulb

New
313
Sold
159

TI:8424

http://www.paulboenisch.com

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Starving Artist

We’ve had enough and are leaving Vancouver next year. One possibility is Kelowna, does anyone have stats on that housing market? Can’t find any charts on the OMREB site, found this graph up to 2011 for the region:
http://www.pcrealty.ca/2012/02/history-of-central-okanagan-real-estate-values/

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queue2

If you want something fairly decent, Kelowna can get pricey.

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Starving Artist

Yes, that seems to be the case. Just curious if prices are still flat from 08-09 or what the trend is now, especially as it seems like there was a lot of Alberta money in that area.

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Newcomer (N)

Why Kelowna? I’m thinking of getting out of Dodge too, but Kelowna would be low on my list as it’s pretty pricey for what you get. I think Victoria is a better deal.

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Starving Artist

The weather, mostly. I really dislike grey/rainy winters.

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Pricedoutfornow

Ugh, don’t go to kelowna if you dislike grey winters. Grew up there, was depressed every winter as it is socked in with lake cloud from oct-mar. Nobody mentions this but completely true. Just ask a local. Dismal weather. Sure no rain but you wont see the sun either.

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Starving Artist

Thanks for that, I’ve been looking into the climate normals and was quite surprised as I thought it was super sunny in Kelowna (they kind of play up that reputation) – another reason to avoid lakes. Was surprised to find out Victoria has higher “% of possible daylight hours” at 44% compared to Kelowna at 40% (same as Vancouver!). Kamloops is also up at 44% and is looking rather interesting, will have to give it a look this summer. It’s rather pretty and has an airport.
http://climate.weather.gc.ca/climate_normals

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Starving Artist

I’ve been looking at Victoria, but it’s not much cheaper than Vancouver, plus you’re stuck on an island. Doesn’t seem like a win, even with the better weather.

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bullwhip29

HAM is buying up golf courses, vineyards, farmland and prime RE all over the province now (not just in gr vanc)

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bullwhip29

what $20M/acre looks like…
http://nationalpostnews.files.wordpress.com/2014/07/morstad_vancouverhouse7.jpg

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Hyper-mega-Bull

Real estate loophole lets wealthy buyers save millions in taxes

http://bc.ctvnews.ca/real-estate-loophole-lets-wealthy-buyers-save-millions-in-taxes-1.2874603

there is no rule that HAM can’t circumvent.

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space889

Why is HAM fault for following perfectly legal rules? If it is allowed why shouldn’t people taking advantage of it?

It is like saying rich people are cheating in their taxes for using RRSP and income splitting to pay less tax.

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Combat roach

Now I better understand some of our regular posters even they are told many times to see a doctor. Stupidity continues…

http://vancouver.24hrs.ca/2016/04/25/do-asian-men-avoid-help-for-depression

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Dr Oetker

Speaking of seeing a doctor;

Behind the online comments: the psychology of internet trolls
http://www.theguardian.com/media-network/media-network-blog/2014/sep/18/psychology-internet-trolls-pewdiepie-youtube-mary-beard

“trolls are more likely to display noxious personality characteristics, that is, traits that impair one’s ability to build relations and function in a civilised or pro-social way”

“by attracting readers’ attention, upsetting people, sparking heated debates, and even gaining approval from others, trolls can feel important, perhaps much more than they are in their real lives.”

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bullwhip29

it all makes sense now…
http://www.pof.com/member1307432.htm

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wwwww

You can tell it’s him because he has a paragraph of rhetorical questions.at the end

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Best place on meth

Aww, he’s really lonely.

That might explain his frequent references to massage parlours.

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space889

What a surprise, racists and bullies don’t like people who call them out and projects their inner inadequacy and hate onto others and pretend they are victims.

Seriously, I haven’t seen a group of more bitter and depressed group of people than most bears on this site. Normal people don’t need to resort to racist and hate filled remarks in their discussions.

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