Category Archives: data

A note from Ben Rabidoux

Ben Rabidoux runs a blog called The Economic Analyst that features focused analysis of economics and the Canadian housing market.  He is currently in Vancouver to do a presentation with David Lepoideviv titled Vancouver Real Estate: What’s Next?

This is happening tonight Wednesday the 28th – 7:00 pm at the Westin Bayshore in downtown Vancouver.

Update: the talk was last night, you can find some participant impressions in the comments below.

We don’t normally post about events, but many readers here may be interested in this one.  Here’s a comment Ben left here yesterday:

 

Hey to the VCI crowd.

I’m enjoying my time in this beautiful city, although I’ve been looking over my shoulder a lot with the CAAMP conference in town. I keep waiting to get jumped. So far, so good.

Had the pleasure of meeting a few of the forum characters. Most casual readers of this forum have no idea how many really smart professional analysts and portfolio managers read and contribute to this site. VCI is without a doubt the top online real estate forum in the country (should also give a shout-out to House Hunt Victoria which is also very solid).

One final plug for what brings me to the city: The seminar will be tomorrow at 7pm at the Westin Bayshore and as a teaser, the staff at the Lepoidevin Group have printed (in colour) and bound the entire presentation for every person in attendance to take home. Should be a fun conversation piece if you leave it on your coffee table.

http://www.realestate2013.ca for more info.

-Ben

All aboard the poverty train.

The middle class in Vancouver is shrinking.

A widening gulf between the rich and the poor makes for a marked shift in demographics over the last 40 years.

And there’s a fascinating difference between Toronto and Vancouver when it comes to distribution of these two classes:

In Toronto high income residents have centered around transit hubs, while in Vancouver the opposite has happened and poverty has spread along the skytrain line.

And numbers from 2010 income tax returns that Ley received this week show accelerated polarization between rich and poor, especially in the Downtown Eastside.

Vancouver’s experience is opposite of Toronto when it comes to transit, Ley said, as high income residents concentrate around transit in Hogtown.

It’s a phenomenon Martin Wyant, CEO of Tri-Cities social services organization the Share Society, can see simply by looking at the increase of residents that need Share’s food bank – a 59 per cent rise since 2007.

In the suburbs, new condo developments hide the poverty, he said, but most people are forced to commute for higher paying jobs.

I guess the question is this: will the recent push to build and sell condo towers at transit hubs shift this trend up or down?

So who’s buying condos?

By now even the reader of the province know it’s a slow real estate market out there.  Not much is selling, sales to list ratio is low and prices are dropping.

..and yet, we still hear of new developments that have big opening day sales (where ‘opening day’ conveniently ignores months of marketing).

So who’s buying these new condos?

According to Bob Rennie it’s young people without any money:

Rennie Marketing registered 7,500 potential buyers before the sales launch, and he says the majority were under 28 years old. He believes it is the young demographic that is fuelling the sales of projects like the two he’s selling at Marine and Cambie. Part of MC2’s appeal is that because it’s not downtown (a 20-minute SkyTrain ride), the prices are lower. And pricing on more than half the homes was kept under $350,000, to appeal to the young demographic.

“So, we made the right decision bringing on both towers at MC2,” he reflects, sitting in a trendy coffee shop on Main Street. “We’ve released all the affordable product. There are 130 homes without parking so that we could get inventory under $300,000. We really did the research on the first-time buyer when we did Marine Gateway across the street, and 28 per cent of our buyers answered in an exit survey that they were receiving down payments from mom and dad, and grandparents.”

Full article in the Globe and Mail.

We love debt even more than Americans

Canadian consumer debt.  It’s not just growing, it’s growing faster.

Transunion has released their latest quarterly analysis and it shows Canadian household debt loads increasing 400% percent faster than inflation.

Statistics Canada pegs Canadian household market debt at an astounding 163% of disposable income.

For comparisons sake, the US housing bubble saw household debt peak in 2007 at 128% of disposable income.  By 2011 the US rate was down to 112%.

The good news? Credit card debt is actually down year over year and delinquencies across all types of debt remain low.

Transunion puts the average household non-mortgage debt at $26,768.  Do you owe more or less than that?

Higgins said the increase stands in stark contrast to encouraging signs from relatively stagnant debt growth in the prior three quarters.

He also points out that in the past five years, debt loads have increased 400 per cent more than the rate of inflation — with inflation as measured by the Consumer Price Index up nine per cent and consumer debt jumping more than 37 per cent.

“Debt’s outpacing us and continues to outpace us, so at some point in time there’s going to be a reconciliation,” Higgins said.

“Hopefully it’s not drastic and hopefully it doesn’t hit everybody, but there’s going to be a correction somehow along the way.”

Read the full article over at the CBC.

Bear vs. Bull in the Battle of Vancouver

Haven’t you always wanted to see housing market data presented as an exciting battle map?

Somewhat more exciting than your average excel sheet, VMD has started a Battle of Vancouver thread over at Vancouverpeak.com where he’s got maps showing the ups and downs of the market for condos and single family homes.

It’s interesting that you really get a sense of things changing on the periphery first.

There’s a stripe of red in the centre where prices are still up year over year. Here’s the map for Single Family Homes:

There’s a similar thing happening in Condo prices, although more areas are Year over Year negative there.  Oh, and for extra excitement on this map there’s TANKS! (each tank represents a single percent point up or down):

Click here to view the full thread on Vancouverpeak.com

..And if you have stuff to share over there, here are a few more invite codes to register for a user account:

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30v5-2sfh-6ozj
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