The ‘cry wolf’ club

There are a few organizations that have raised a public alarm over the state of the Canadian housing market, with particular focus on Toronto and Vancouver:

The IMF, The Bank of Canada, The Canadian Mortgage and Housing Corporation, The Office of the Superintendent of Financial Institutions, Most of the big banks, The OECD, and more.

It seems that everyone is freaking out about the Canadian housing market.

Despite industry assurances that the hottest housing markets in Canada, particularly Vancouver, will always remain hot, and that it is physically impossible for prices to decline in this miracle economy, Canadians are now becoming aware that those assurances have just been another load of industry hype. And a larger share of them are starting to grapple with a new reality – a reality in an over-leveraged, inflated housing market where prices have come to rest on the edge of a cliff.

In Vancouver’s once white-hot commercial real estate market, the hunt is now on for Chinese buyers as big institutional investors are trying to unload.

And yet, despite years of warnings here we are near record high house prices. If you bought a few years back and sold a month ago, you’ve done quite well.

So it seems we’re now entering another down phase, with reports of softening sales and prices, especially at the high end. The warnings are getting louder, but of course there are always people who propose that this market is different and will never truly crash.

Sometimes the number of warnings and lack of crash almost seems to prove it – Just like the boy who cried wolf, we start to get desensitized to all the warnings.  Unfortunately for some of the villagers we all know how that story ends.

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UBC in Crisis Mode
Guest

People never learn. There are trillions dollars have yet to leave China, and price will never go down, like this one just sold:

4038 W 39th Ave, asking $5,380,000.

Boombust
Guest
Boombust

Don’t be so stupid. RE markets are determined by the locals. Recent stats re: high Canadian debt levels along with the highest ever home ownership rates have this market sputtering on fumes.

It’s a BUBBLE, Bub, and they all pop eventually. Give your head a shake and get a check up from the neck up.

Nom Nom Nom
Guest
Nom Nom Nom

Nice alliteration!

Bbbbb
Guest
Bbbbb

You get the Naive award for the day OR the troll award. Pick one.

david
Guest
david

Some people learn.
Others…well, best of luck with everything, sport.

bullwhip29
Guest
bullwhip29

just driving around, 3-4 teardowns in west richmond had sold stickers slapped on them them in last 2-3 days. if you are not tax exempt then doing the teardown and rebuild is clearly cheaper (by maybe a couple hundred grand) than buying newly built.

Diadora
Guest
Diadora

Maybe, but I have know many locals that had purchase because they see mainland chinese buying and they use their present house to get the loan, hoping to flip later. Heaven help these people if or when RE goes down.

Its_the_ALR_stupid
Guest
Its_the_ALR_stupid

There seem to be a lot of opinions about how much the market is about to decline.

So I suggest a poll. How much do VCI-ers think the market will go down? For consistency,I recommend comparing REBGV benchmark numbers for detached, attached, and condos.

My peak-to-trough predictions:
Condo: Down 10%
Attached/Townhouse: Down 15%
Detached: Down 20%

david
Guest
david

An objective, economics-based guess is -50% or more.
A weed-infused, math-ignorant, realtor-coached, ADD-afflicted, recency-biased guess
is +30%.

bullwhip29
Guest
bullwhip29

maybe differing opinions but wisespread message is that at least a correction is upon us. imho too many have hopped onto the bear bandwagon all at once. can’t be this simple. if it is krusty’s intention to do a 180 post election then this is another buying opportunity. when everyone thinks all is back to normal (maybe sometime in 2018) it will be time to cash in.

YVR
Guest
YVR

Condo: Down 70%
Attached/Townhouse: Down 75%
Detached: Down 80%

ostritch
Member
ostritch

Wow. That didn’t even happen in the US unless you are talking about Detroit and even then?!

SuperHomeRich Vancouver Home Owner
Guest
SuperHomeRich Vancouver Home Owner

It will be up 110 % in 2017 summer.

Shut It Down Already
Guest
Shut It Down Already

Search the archives. You’ll find dozens of posts like this which go back years.

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName

‘You’ll find dozens of posts like this [from past] years.”
Not relevant.

david
Guest
david

An article in yesterdays G&M had the premise that Vancouver could learn lessons from Seattle in dealing with the lack of affordable rental units.

This is the very first sentence of the article : “Seattle rents have shot upwards in the last few years, as the economy has boomed and new people have flooded to the city to work at Amazon, Microsfot and a plethora of other tech companies. ”

Pretty succinct description of Seattle’s issue. A strong economy, driven by substantial, growing, wealth generating companies, bringing in lots of new people.

Vancouver? Ummm….what does a top dog walker make?

Madashell
Guest
Madashell

“In many ways, China remains one of the greatest ongoing threats to Canada’s national security and Canadian industry,” the report says.
The Chinese government and Asian criminal gangs have been working together in drug smuggling, nuclear espionage and other criminal activities that constitute a grave threat to Canadian security, a secret study by federal law-enforcement and intelligence analysts says.
http://www.theglobeandmail.com/news/national/china-set-up-crime-web-in-canada-report-says/article4163320/
Wonder if Baby Trudeau ever read Canada’s intel report in between the photo ops

david
Guest
david

Too busy training. He’s an accomplished boxer, you know.

Diadora
Guest
Diadora

What the hell is Canada doing by opening the door wide to this group of immigrants and investors. It was proven most lied on their immigration applicants and too of them use our real estates to hide and launder their dirty money gained from lying. cheating and corruption! And they are a security risk too as pointed out by Canada’s intelligence.

Billybonger
Guest
Billybonger

September starts tomorrow.

Listing fall as month end expires kick in,what happens next?

Will Oracle panic and lost his place, stay with the in laws and lick his wounds!

Or will a wave of immigrants come and buy up this town of ours?

Should be interesting.

Will we finally see a surge in listings….??

Bbbbb
Guest
Bbbbb

I think your going to be wrong. 8K party coming in a few days.

Shut It Down Already
Guest
Shut It Down Already

We won’t see 8K again this year.

bullwhip29
Guest
bullwhip29

Coquihalla anniversary plaque cost $65,000
https://www.biv.com/article/2016/8/coquihalla-anniversary-plaque-cost-65000/

“The plaque, unveiled May 25 at the Britton Creek rest area, names Premier Christy Clark and Transport Minister Todd Stone, but none of those who were originally involved in the project.”

MarKoz
Member
Active Member

The motivation behind Vancouver’s foreign tax is pure political survival.
http://www.theglobeandmail.com/news/british-columbia/the-motivation-behind-vancouvers-foreign-tax-is-pure-political-survival/article31628911/
The number of homes bought by people living abroad was an inconsequential fraction of the total, the real-estate association insisted. British Columbians with mean annual family incomes of $60,000, we were expected to believe, were behind the unprecedented feeding frenzy we were witnessing: Average Joes and Janes bidding hundreds of thousands more than asking for teardowns suddenly worth $2-million or more.

YVR
Guest
YVR

For the most part everything a government does is about political survival. They do not make policy to not get elected (intentionaly).

paulb
Member
Active Member

New
117

Sold
127

TI:9190

http://www.paulboenisch.com

MarKoz
Member
Active Member

Despite all the predictions of doom in the housing market the sales to new lists ratio has been remarkably bullish.

YVR
Guest
YVR

Sales down 70% is bullish? Average prices down 20% is bullish? Listings will flood in mid September.

IloveING
Guest
IloveING

A 108% sales to list ratio with record low inventory isn’t bullish? What exactly would it take to change your opinion?

yvr2zrh
Member

Most of the statistics this month will be difficult to draw final conclusions from. Listings are usually lower in August – as are sales – but both are down significantly. In isolation it is a strong market indicator but generally the main market strength indicator is just pure sales volumes. Then – sales to active listings drive price pressures.

Boombust
Guest
Boombust

Are you nuts?Increases in inventory can (and will) happen “just like that”.

Shut It Down Already
Guest
Shut It Down Already

Average prices are not down 20%. Average price of a very low volume of sales is. There’s a huge difference.

patriotz
Member

There is no difference at all, because you only have a price if you have a sale. That’s the data set that you’re taking the average of.

MarKoz
Member
Active Member

YVR, I have been on this blog and others like it since 2004. Like the X-Files, “I want to believe”. I hope and pray for a correction, but all the statistics and reasonable arguments for a correction have never lead to one before. I hope you are right , but after 12 years of being wrong, I am not holding my breath.

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName

I’m like Markoz in having followed this blog and others like it since 2006. I hope and pray for a correction, but all the statistics and reasonable arguments for a correction ahve never lead to one before. I hope you are right, but I think its not improbable that instead of a fast deflation, it will take a long time, many years.. So for me, at my stage in life, I’m wondering whether I should try to settle somewhere else for potentially higher pay, more affordable housing, and more highly valued cash.

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName

However of course I don’t want to leave my friends and the beauty of this area behind.

Its_the_ALR_stupid
Guest
Its_the_ALR_stupid

It really comes down to whether you want to buy a condo or a detached house. If you want a condo, you need to accept that they will always be somewhat more expensive than other parts of Canada, but not outrageously so. They are constantly making more so they will never be totally unaffordable.

Detached houses, on the other hand, will never be affordable again because we have basically stopped increasing the supply. So in my opinion the upcoming price drop over next 12 to 24 months might be your last chance to get in before they go even higher.

I\'m With Stupid
Guest
I\'m With Stupid

“We have basically stopped increasing supply”
Is that even true? Does anyone have stats for this, I still see many houses turned into two smaller houses, plus Surrey etc.

Ulsterman
Member

CNTOAGN & MarKoz, wow, I didn’t think anyone else went back THAT far. Isn’t it maddening to watch you financially illiterate friends make a million bucks in equity in 10 years while you analyze why this doesn’t make sense? I thought real estate was peaking in 2004 when condos were exploding in price. I do laugh as I watch New Bears feel confident that “NOW the top is in because of __insert good financial reason__” Folks, been there, done that – don’t be too sure this is it.

Super Rich Chinese Houses owner
Guest
Super Rich Chinese Houses owner

At least 10000 yrs.

I\'m With Stupid
Guest
I\'m With Stupid

I’m in the works of capitulating, never thought I would end up paying 800/sq ft, but here we are.

ostritch
Member
ostritch

Shhhhh.

Bbbbb
Guest
Bbbbb

8K party coming soon.

Many listings expiring Sept 1.

rockerguy
Member
rockerguy

The ratio of New Listings to Sales is higher than any previous August in my dataset (back to 2012). But, during the last half of August, this ratio took a dive back to 2015 levels.

Looking at individual statistics, the flow of new listings in the last seven days of August was slightly lower than that same period in past years. And the flow of sales in the last seven days of August was also slightly lower than normal.

It’s not reasonable to say everything has gone back to normal with only a week or two of sales beating new listings.

Whistler or Bust?
Guest
Whistler or Bust?
YVR
Guest
YVR

Even more shocking is a Michael Phelps with a current net worth of $70 million CAD buys a $3 million CAD house as his principal residence. Here in Vancouver postal workers own $3 million houses.

david
Guest
david

Yes but Michael Phelps doesn’t have the job security of a Canadian postal worker.

rockerguy
Member
rockerguy

And of course, Michael Phelps’ house has a swimming pool.

bullwhip29
Guest
bullwhip29

MACLEAN’S: Trudeau’s China problem starts at home
http://www.macleans.ca/economy/trudeaus-china-problem-starts-at-home/

Best place on meth
Guest
Best place on meth

One country after another is backing away from china as they realize what kind of nasty people they’re dealing with.

Not our little son of a communist though.

When Justin lies down with dogs, we’re all going to wake up with fleas.

Bear Vancouverite
Guest
Bear Vancouverite

BPOM, I’m wondering what party you voted for? I voted Cons because I felt Trudeau would open the floodgates to immigration, and I also wanted to keep the TFSA higher. sadly my fears of Trudeau and immigration are proving to be quite well founded.

Best place on meth
Guest
Best place on meth

Green.

I won’t vote Con and both the Libs and NDP in Van East put up chinese candidates who refused to criticize china.

And seriously, fuck Jenny Kwan.

Boombust
Guest
Boombust

You ACTUALLY voted for that psychopath, Harper? Unbelievable.

Sellnoworbepricedin4evah
Guest
Sellnoworbepricedin4evah

Lol. Harper ain’t got nothing on baby Trudeau and his constant narcissist photo ops. When he lived here (as a drama teacher who never bothered to show up to school he taught at) he was already sociopath x 10. Ohhhhh I miss the days when he couldn’t get into the ” it club” of the day and would stand on the street yelling “don’t you know who I am?). Lol. Douche.
The masses don’t of course know those tidbits.

david
Guest
david

Trudeau’s stint as PM….and it could be a long one, judging by the continued frenzied adulation….will be called the “how did I look?” years. Versus “see what I did”.

bullwhip29
Guest
bullwhip29

Feedback received by the City of Vancouver reveals anti-Asian racism persists in real-estate debate
http://www.straight.com/news/767491/feedback-received-city-vancouver-reveals-anti-asian-racism-persists-real-estate-debate

Best place on meth
Guest
Best place on meth

The only problem with the feedback is that people keep referring to “Asians”.

There is no issue with “Asians”, only with mainland chinese.

Pathetic also that facts are interpreted as racist, such as:

“The majority don’t give a hoot about Canada, don’t assimilate, don’t look after their property, and many don’t even pay income taxes.”

These are well documented defiencies of the locust invaders, but many others were missed that it would take me all day to list.

Shut It Down Already
Guest
Shut It Down Already

Got some hard facts and stats to back up your assertions then? Thought not.

Best place on meth
Guest
Best place on meth

I would answer that if someone else asked.

But then nobody else would ask such a stupid question.

Tim
Guest
Tim

To be fair, what evidence there is to support your screed applies to the 1% capital flight people, not immigrahts in China generally.

And ““The majority don’t give a hoot about Canada, don’t assimilate, don’t look after their property, and many don’t even pay income taxes.”

Applies well to a whole lot of white 1%r landlords and arbutus club snobs just as well. I’d say most.

Best place on meth
Guest
Best place on meth

I’m not sure what your question is exactly.

The immigrants from china that have been flooding into Canada are the 1%.

They are scumbags.

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName

Yeah, that’s a key point I don’t think the typical person in the rest of Canada gets.

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName

about Vancouver immigration I mean.

Chinabuyeverything
Guest
Chinabuyeverything

No one dislikes the money laundering mainlanders more than the legitimate mainlanders.

Diadora
Guest
Diadora

Proves HAMs are parasites and low lives that are hated and should be banned. deported back to their homeland where ever it may be.

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName

The problem is for years everyone has been taught to say “Asian” in order to be polite when referring to people from China rather than saying “Chinese”, even though “Asian” is a very general word and “Chinese” a very specific word. So now we have to TAKE BACK the words “Asian” and “Canadian of Asian descent” to mean any of a huge diversity of people, and we have to REINVIGORATE the word “Chinese” and put it back in play to mean a NATIONALITY and not a person from any of several Asian countries..

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName
It was considered more polite to say “Asian” rather than “Chinese” by the way because at one point in time many Canadians with other ancestories were not familiar enough with the variety of Asian cultures to tell the difference between one emanating from China and other ones, so people would say “Chinese” when they actually meant to refer to person connected to an entirely different kind of Asian culture. But that time is long past. We live in a different world, partly because of the internet and partly because people travel so much and partly because Canada as it happens is very multicultural so people learn about each other from a young age. SO the TIME is past to use the word “Asian” in those cases where you know that you’re referring to someone who identifies as being from Mainland… Read more »
bullwhip29
Guest
bullwhip29
bullwhip29
Guest
bullwhip29
bullwhip29
Guest
bullwhip29

Vancouver student housing crunch hits harder than stack of textbooks
http://www.news1130.com/2016/08/31/vancouver-student-housing-crunch-hits-harder-than-stack-of-textbooks/

>>> I rent three, my husband gonna rent three…

Newcomer
Member
Newcomer

“Garousian says last year he could find a two bedroom apartment for $1,600, but this year, he considers it lucky to find a one bedroom for that price.”

Garousian is clearly a moron, as I just found 481 for that price or less of Craig’s List. This media game only encourages landlords to ask for higher rents. In the long term, they will not get them but it can make things difficult for students in the next month.

Sellnoworbepricedin4evah
Guest
Sellnoworbepricedin4evah

Correct.

bullwhip29
Guest
bullwhip29

actually if you search for 1BR only in Vanc there arent that many

YLTNboomerang
Member

This is interesting as 1 BR’s are the speculators unit of choice. The issue isn’t that there are not any 1 BR’s but that there are a huge number of empty 1 BR’s that are not being rented for two reasons:
1. Easier to flip quick if nobody is renting
2. Keep in new condition

If the city of Vancouver ever gets off its ass and puts in the empty house tax there is going to be too much student housing!

CanNeverThinkOfAGoodName
Member
CanNeverThinkOfAGoodName

They’ll be distracted by money problems when they’re supposed to be studying.

Patiently Waiting
Member
Patiently Waiting

All they need to do is rent out their living room couch on Airbnb. Small-time landlords will have tenants doing this and not even realize it. Meanwhile, try that in a properly managed building and you’ll get yourself evicted.

Newcomer
Member
Newcomer

Detached Housing Market Takes Heavy Blow in August
http://www.vancitycondoguide.com/detached-housing-market-august/

LS in Arbutus
Guest
LS in Arbutus

I am wondering if the lack of listings is, in part, because people aren’t getting top dollar for their houses and so are taking it off and will try again later….. ha ha ha ha…… a friend’s parents had their place listed and didn’t get what they thought was enough (this was when the market was HOT) so they took it off the market. Anyhow… interested to see what September brings.

Newcomer
Member
Newcomer

That is exactly what is happening.

Its_the_ALR_stupid
Guest
Its_the_ALR_stupid

People remember the last correction in 2009 when prices recovered all of their losses within a year. It wasn’t that long ago, so they’re taking their listings off the market to wait out the recovery.

I don’t know if it will work or not, but that’s definitely what most of them are thinking.

Sellnoworbepricedin4evah
Guest
Sellnoworbepricedin4evah

It won’t work. Take a look at Canada’s gdp. Gonna get ugly.

Whistler or Bust?
Guest
Whistler or Bust?

Same story of a couple I know in South Surrey

ostritch
Member
ostritch

I think what they are doing fits the meme: bears make money, bulls make money, pigs get slaughtered

SuperHomeRich Vancouver Home Owner
Guest
SuperHomeRich Vancouver Home Owner

My trough-to- peak predictions in 2017 January
Condo: up 30%
Attached/Townhouse: Up 25%
Detached: Up 30%
My trough-to- peak predictions in 2027 January
Condo Average Price : 1500000 USD.
Attached/Townhouse Average Price:5000000 USD
Detached Average Price: 10000000 above.
Never late to be a home owner in Vancouver.

southseacompany
Member
southseacompany

“Vancouver-region home sales expected to fall in wake of tax on foreign buyers”, Globe & Mail
http://www.theglobeandmail.com/real-estate/vancouver/vancouver-region-real-estate-sales-down-in-wake-of-tax-on-foreign-buyers/article31656246/

“Vancouver’s housing market could be in for a shock on Friday when the Greater Vancouver Real Estate Board reports on housing sales data for August, offering the first official glimpse of the effects of British Columbia’s new tax on foreign home buyers.”

“Early numbers from the real estate board released in the middle of the month showed a sharp drop in housing sales in the region in the wake of the provincial government’s Aug. 2 introduction of a 15-per-cent land transfer tax on foreign buyers.’

southseacompany
Member
southseacompany

“Fitch Ratings: Housing downturn the biggest concern for Canadian banks”, BNN video

http://www.bnn.ca/video/fitch-ratings-housing-downturn-the-biggest-concern-for-canadian-banks~940401

“Canada’s big five banks have proven their resiliency, with all of them beating Q3 earnings expectations. Fitch Ratings Senior Director Doriana Gamboa tells BNN why she sees housing as the biggest concern for banks and gives her outlook for energy loan loss provisions.”

Bbbbb
Guest
Bbbbb

That’s why Ttudeau and McCallum are going to significantly increase immigration and double foreign student numbers to 800,000

Patiently Waiting
Member
Patiently Waiting

Resident owners win condo battle in Toronto
http://www.cbc.ca/news/canada/toronto/owners-battle-rental-companies-for-condo-board-control-1.3743645

“Neither WhiteHall nor Red Maple own suites in the building. Instead, they lease the units from their owners then turn around and rent them on sites like Expedia.ca and Booking.com.”

space889
Member
space889

Hence need for much more landlord protection and actual punishment with teeth for landlords to use against this kind of tenants.

Openhousemassacare
Guest
Openhousemassacare
Best place on meth
Guest
Best place on meth

Good, now if we could see 5000 realtor jobs lost as well, along with thousands of mortgage brokers and other parasites.

Fucking whiners.

Slava
Guest
Slava

Bingo!

space889
Member
space889

And you aren’t a whiner? Always bitching Chinese this, Chinese that, not fair you can’t buy a house cheap?

Do you work for government or crown Corp or other public institutions? If you do, you are pretty much a parasite at the taxpayers teat.

mls watch
Guest
mls watch

They can relocate. Some places in the region have a shortage because Vancouver was attracting too many workers.

MarKoz
Member
Active Member

Another great article by Josh Gordon:
http://www.theglobeandmail.com/report-on-business/rob-commentary/toronto-dont-let-vancouvers-housing-crisis-become-yours/article31644646/comments/

That’s a preliminary list [of spurious arguments the RE industry will use]. There will undoubtedly be much more obfuscation from those with a vested interest in the status quo. They have money at stake and will throw it around to have the provincial government listen. And they will be persistent, repeating endlessly the same misleading or disproved claims.

Yet, 82 per cent of Vancouverites say the foreign-buyer tax was long overdue. Don’t let the Ontario government lead you into the same crisis Vancouver now faces.

Openhousemassacare
Guest
Openhousemassacare

CUNT Christy Clark won’t run in Vancouver in next provincial election

http://www.straight.com/news/769761/premier-christy-clark-wont-run-vancouver-next-provincial-election

bullwhip29
Guest
bullwhip29

Clark’s Medal of Good Citizenship Cloaked in Secrecy
http://thetyee.ca/News/2016/08/31/Christy-Clark-Good-Citizenship-Medal-Cloak/

Openhousemassacare
Guest
Openhousemassacare

CUNT Christy is an epitome of corruption

bullwhip29
Guest
bullwhip29
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