Fa-fa-fa-friday!
Let’s do that news round up and open topic thing, here are a few recent links to kick off the chat:
– brutally slow sales in March
So what are you seeing out there? Post your news links, thoughts and anecdotes in the comments below and have an excellent weekend!
[…] Mortgage rules to blame […]
[…] not just Vancouver, sales are falling across the nation marking the first March decline since the […]
“In midst of slow home sales, B.C. Real Estate Association shines spotlight on impact of tighter mortgage rules”, Georgia Straight
“And once again, the BCREA has pointed the finger at a federal mortgage policy as a major contributing factor. The B-20 test, introduced last year by the Office of the Superintendent of Financial Institutions, requires lenders to test a borrower’s ability to repay a mortgage if interest rates were 200 basis points above the agreed-upon rate.”
Trudeau government plans to increase foreign student intake. Presently at 600,000.
To what? A million??
The little twat son of a duck farmer makes ZH.
“Almost exactly two years ago, at the peak of the Vancouver housing bubble which was the result of an unprecedented money-laundering funds flow by Chinese oligarchs and tycoons into the Western Canadian real estate market”.
“Meanwhile, business as usual continues as China’s wealthiest can’t wait to transfer their savings offshore, even as Beijing, now facing its first current account deficit in modern history, is desperate to open up its own corrupt and crony capital markets to yield-starved foreign investors who in turn will make sure that Ding Chen ends up buying many more Bugattis before he too is mysteriously found deceased of a “heroin overdose” in the boot of some (super)car himself.”
Ya gotta love reading ZH if just for the literary content …
Tell me again how you don’t immerse yourself in extreme right-wing propaganda…
Welcome to Cedar Walk by Polygon, a picturesque and walkable parkside community steps from an abundance of shops and services. Nestled at the gateway to the UBC campus, Cedar Walk is surrounded by a stunning natural setting and all that a great university has to offer. Great elementary and secondary schools are also nearby.
Not sure who is buying these new condos at UBC, priced $1200 /square foot. Many of them sold lately.
For example:
2019-Mar-22 Listed $1,158,800 MLS # R2352398
They all sold at exactly asking price, so isn’t this just the sales being registered from completion of the building?
“Big Housing Bust to Come”, Nasdaq
https://www.nasdaq.com/article/big-housing-bust-to-come-cm1128112
“How does a big global housing meltdown sound? Crappy. Well, that is exactly one of the things that the IMF is currently warning investors about. Americans will already be well aware of the several month downturn in real estate, but what is likely much less well understood is that many markets around the world, including emerging markets, look at risk of a major housing bust. One of the big worries of the IMF is that a real estate downturn will spark a banking crisis in overseas markets that could then bubble over to the rest of the world.”
“Sovereign Debt, Slowing Growth, and a Housing Bust Top the IMF’s Worry List”, Barron’s
“Boom-bust patterns in house prices preceded more than two-thirds of the nearly 50 systemic banking crises in recent decades. In 30% of advanced and emerging markets, housing prices are at risk for declines at a similar magnitude to 2007 in the U.S.”
“The housing bust and why it’s likely to continue”, ABC Australia
https://www.abc.net.au/news/2019-04-15/why-the-housing-bust-is-likely-to-continue/11002296
“Australian housing prices have been unwinding at a serious clip now for close to a year and a half, led by the cities that kicked off the boom, Sydney and Melbourne.”
“The problem now is that the fundamentals driving the slide cannot easily be altered. An interest rate cut may ease the pain but won’t cure the affliction. That’s because the housing market is being undermined by two potent forces; much tighter credit conditions and a looming supply glut.”
“Canadian home sales fall for sixth month in first March decline since the recession”, Financial Post
“Canada’s once-hot housing market has softened since the start of last year, as tighter mortgage rules and five interest rate hikes from the Bank of Canada since July 2017 have curbed buyer spending power.”
“Edmonton home sales and selling prices suffer five-year March lows, first quarter real estate statistics show”, Edmonton Journal
““We were expecting the market to be moving but it continues to be slow, a lot of which is driven by external factors that are beyond our control where federal policy is continuing to have a negative effect in Alberta,” association chairman Michael Brodrick said Wednesday.”
All the foreign buyers left Edmonton, too!
“Why house prices are unlikely to rise any time soon”, MacLeans’s
https://www.macleans.ca/economy/realestateeconomy/canada-real-estate-market-spring-outlook/
“Last January, the government imposed a new mortgage stress test. Uninsured borrowers must now qualify at the Bank of Canada’s five-year benchmark rate, or at their current rate plus an additional two per cent. The changes had an instant effect on sales, one that is likely to continue this spring. Prices in February fell for Vancouver, Edmonton and Calgary, marking Calgary’s 10th month of drops, with Edmonton in negative territory since the summer of 2017. “
3867 INVERNESS ST, 1.450, 1.328, 1.120, -23%
435 37TH AVE E, 1.546, 1.449, 1.189, -23%
436 55TH AVE E, 1.350, 1.050, 950K, -30%
8367 VICTORIA DR, 1.092, 999K, 970K, -11%
4015 BOUNDARY RD, 1.426, 1.500, 1.199, -16%
1316 20TH AVE E, 1.562, 1.499, 1.300, -17%
Engineers of the Soul: Ideology in Xi Jinping’s China by John Garnaut
John Garnaut, one of the top journalists covering China before he joined the Australian government, first as a speech writer for Prime Minister Malcolm Turnbull and then as a China policy advisor.
The challenge for us is that Xi’s project of total ideological control does not stop at China’s borders. It is packaged to travel with Chinese students, tourists, migrants and especially money. It flows through the channels of the Chinese language internet, pushes into all the world’s major media and cultural spaces and generally keeps pace with and even anticipates China’s increasingly global interests.
5028 PINE CRES, 2018 assessment 3.405, listed 2.980, sold 2.840, -17% to assessed value.
642 52ND AVE W, 2.726, 2.750, 2.400, -12%
1826 12 AVE W, 2.536, 2.679, 1.875, -26%
6091 WILLOW ST, 3.088, 2.988, 2.580, -16%
4411 4TH AVE W, 7.149, 6.599, 5.300, -26% (-37% from 2017 assessed)
6453 MACDONALD ST, 3.878, 3.788, 3.100, -20%
Forgot this one:
1849 30TH AVE W, 3.756, 2.998, 2.800, -25%
It’s the spring edition of “WEAR EEBEE?”
On a side note, is it weird that I’m looking forward to Peter German’s newest money laundering report more than the new Avengers movie?
No, not weird.
I’m fucking sick of all the superhero/comic book/animated shit in theaters all the time now.
It’s all by one company now. Disney now owns Marvel who own basically alll the superheroes including X men.
Batman, Superman, WW the other side.
March 2019 Market Insights – Real Estate Board of Greater Vancouver
https://youtu.be/XMuPT8fCkQc
Do you agree with her statement (too many policy changes only put buyer on the sideline temporarily).
Totally disagree. Yes the new policies are having an effect, but they’re just amplifying weakness that was starting to creep in before the policy changes anyways. These multi-decade lows on sales volumes are a measurement of buyer fear, and I feel it’s enough fear that the buyers aren’t going to come back in time to prop up the extremely precarious valuations. Once some horror stories from highly motivated sellers begin to permeate market sentiment, there will be a self-perpetuating downward spiral that won’t stop we hit some sort of utilitarian valuations in most metros. The only hope for sellers is if the market stays inflated long enough that buyers assume the money-printing machine still works and the FOMO’s come back in. It’s not a very likely outcome this late in the credit cycle however.
Can’t believe I’m going to agree with you here.
The psychology could take this market down. Pressure your MLAs to keep up the pressure. Don’t let up.
@Bubble I guess the REBGV had to settle for Ashley Smith for that bit of propaganda because the y couldn’t find Bagdad Bob. Certainly intended for the dumb of the dumbest. I mean, lets look at the big picture before we stray entirely from reality: There are clear indications that the turning of the RE tide is a global thing…Australia, the UK, Europe, and warnings emerging in the US. HAM which had driven our bubble to the utmost limits of insanity is not only DEAD, but is now scrambling to get the hell out. Desperate boomers will be the next to cash out while they still can. Locals who bought at the peak are buried in debt and stretched to the limit. Local incomes are a fraction of what would be required support a million$ mortgage. Oh, and what about… Read more »
“Do you agree with her statement (too many policy changes only put buyer on the sideline temporarily).”
I agree with this statement. Most “buyers” will eventually buy but at a fraction of the price.
16,000 total inventory by end of April is what’s needed.
Why?
More inventory is obviously better. Once we hit 20000 there is no turning back. Next spring for we should be there.
14,342 TI on Friday. So for 16k we’d need 1,648 more listings. 16 days left in April means an average of 103 more listings than solds+expiries per day. Not going to happen at current pace, but if the fabled “rush to the exits” starts before the end of month then anything is possible.
Dad, are you still expecting this little dip in prices to reverse?
Should I buy now or be priced out forever???
CBC talks about how money laundering through Vancouver Real Estates
https://www.youtube.com/watch?v=t-wm-rI0uho
We need a public inquiry now.
We need police investigations and charges laid. Do you think HAM cares about political and finger pointing spin?
Certainly not, they have no sense of shame or social responsibility whatsoever.
Cry me a fucking river…
Developer admits he’s ‘desperate’ as multimillion-dollar West Vancouver home prices tumble
“Geller, who has worked in the real estate industry for 45 years, said this market is the worst he’s ever seen — and that includes downturns in the early 1980s and the 2008 financial crisis.
Between June 2015 and June 2016, home prices in West Vancouver and Vancouver’s westside rose by 37.8 and 36.4 per cent, respectively…….
Soprovich said buyers from Mainland China were a big presence in the West Vancouver market in 2015 and 2016, but tighter capital flow restrictions brought in by the Chinese government, and the decision to introduce the foreign buyer tax and then increase it from 15 to 20 per cent, have basically “put the brakes on foreign investors.”
Gelled and his ilk can’t be too smart if they thought the house party would’ve continued indefinitely. This Chinese money would be the most fickle of any.
Geller still expects to America’s a 5% profit so he’s not exactly losing his shirt. And soprovich says people are now buying houses to actually live in. What a concept. The NDP has been successful in reigning in this crazy housing market.
Make a 5% profit. spell check malfunction.
Doubt it. He’s going to lose IMO.
Yup the places are not selling at the 5% profit price. Clearly he will have to cut prices by more than that to sell. More the longer he waits.
He should just rent them while he waits! Real estate always cash flows doesn’t it?
“The NDP has been successful in reigning in this crazy housing market”
Nothing to do with the NDP other than the token 5% increase of the foreign buyer tax.
Soprovich said buyers from Mainland China were a big presence in the West Vancouver market in 2015 and 2016, but tighter capital flow restrictions brought in by the Chinese government, and the decision to introduce the foreign buyer tax and then increase it from 15 to 20 per cent
On the one hand, we have this guy saying “this market is the worst he’s ever seen — and that includes downturns in the early 1980s and the 2008 financial crisis.”
On the other hand we have price plots like the one shown in this article that was posted here just a little while ago, which show how we’ve barely begun reversing the future-harming madness of the last 15 years:
https://wolfstreet.com/2019/04/12/the-most-splendid-housing-bubbles-in-canada-deflate-march-update/
I swear, people like Geller need that eyes-propped-open Clockwork Orange treatment, watching videos of price plots, stories of young people abandoning the region, etc.
He could end up feeling ill every time he tried to say the words “world class” or “hard earned equity”, or if he tried referring to young people being the ones who are acting “entitled”.
Geller makes the world a worse place… and he should feel bad.
People like Geller will help prices correct. He is one of the “must sell” sellers who will have to take what ever the market will pay. Probably leveraged to the tits with a high interest private lender. He was late to the game and will help with the first big leg down this spring.
A reminder that favorite locust “students” didn’t throw a towel yet. How adorable and inspiring.
“Chinese tycoon’s son complains about B.C. taxes on purchase of $5M supercar”
China’s Union Pay credit cards have been the subject of increasing scrutiny as a conduit for money out of the mainland. China has an annual cash export limit of US$50,000, and Union Pay says it enforces an annual overseas cash withdrawal limit of 100,000 yuan (US$14,880).
The son of the duck farmer is outraged that he has to pay any taxes at all in our country.
I wonder what he’s paying for insurance?
It should be at least 1.5 million a year considering he’s going to crash the car in the very near future.
I hope ICBC won’t insure that thing.
Summary: “When sales were low in February, people blamed the snow. People thought that spring would be different. March did bring a warmest day in 123 years, and was one of the driest on record, but still real estate sales remained very cold. The REBGV blames government intervention, but as I discussed in a previous blog post, this is just part of the equation. We are very late in a credit cycle, and it will probably unfold as it has in other credit cycles. ”
Full post here: https://canreinvest.wordpress.com/2019/04/13/down-down-vancouver-real-estate-trend-in-march/
April just may end up adding 2K to inventory…..
Sorry everyone, but the spring market has been cancelled this year!
Drive safely!
What I’m really digging is that trend line that is parallel to my favourite year – 2008. (Thinking to myself while muttering “thou shall not extrapolate, thou shall not extrapolate, thou shall not extrapolate”)
Actually this is the spring market. Get used to it for about 5 to 10 years.
Unlikely.
The Most Splendid Housing Bubbles in Canada Deflate
https://wolfstreet.com/2019/04/12/the-most-splendid-housing-bubbles-in-canada-deflate-march-update/
Between 2002 and 2018, San Francisco prices increased 120% while Vancouver prices increased 320%.
I wonder why such a massive discrepancy.
Tougher money laundering laws in the US as opposed to our non existent ones?
Yes but San Francisco does not have the high paying tech jobs like Hootsuite. Oh wait Hootsuite doesn’t pay its workers I forgot. We do have more mountains.
Hootsuite pays its workers. There was a period when they had unpaid internships.
It’s because San Francisco is a sanctuary city and Vancouver isn’t, of course.
Winnipeg is also up there because of all the foreign buyers and convenient flights to China.
Winnipeg is up where?
What is the cost of a house in Winnipeg compared to Vancouver?
You clearly didn’t read the link.
“I wonder why such a massive discrepancy.”
Perhaps because San Francisco had a proper housing crash in 2008, while Vancouver did not?
New
157
Price Change
92
Sold
78
TI:14352
