Vancouver Condo Info

A week ago we had a community driven interview of Petr and Ola, creators of the instant classic Vancouver Real Estate quiz “Crackshack or Mansion?”.  You asked your questions and voted up the comments you wanted to hear answers to.  Well we’ve sent the highest rated questions on to Petr and Ola and here are their answers:

How long have they lived in Vancouver?
PETR: I have lived here since 2002 and Ola has lived here since she was about 10 years old.

Do they rent or own? (wouldn’t want to presume even the obvious!)
PETR: haha. We rent.
OLA: …one of these “special” 1950’s bungalows.

If they rent, have they been tempted to buy?
PETR: Ola had considered buying a place with her friend in about 2007. I thought the bubble was pretty much at its peak back then and strongly encouraged her to wait. A lot of her friends were getting into the housing market (or thinking about it) and I think the mob mentality almost got the best of her. It didn’t take long to convince it’s a crazy idea (to buy with a friend, and at these prices).
OLA: I shudder when I think about it now. Even if prices kept going up and interest rates stayed low, it’s insane to tie yourself down with other people like that.

Have they considered leaving Vancouver because of RE prices?
PETR: Even though we are convinced this is a bubble that will have a severe correction, the prices will probably still be too high for us. I wouldn’t pay 200,000 for most of those million dollar mansions. The city is nice but it has a lot of competition for the pretty city of the month award. The bubble will pop everywhere so the interior of BC will look pretty good.
OLA: I must admit, owning my dream home has been a fantasy since I was 8. However, my dreams are extensive and require many acres and handcrafted woodwork. It would be a trophy for career success. It would be a frivolous indulgence when I have excess cash flow. Enslaving myself to a peach-coloured 80’s built condo isn’t really a replacement for that.

(more…)

Petr and Ola are the creative duo behind Crackshack or Mansion, the online quiz that serves up very clear visual examples of lunacy in the Vancouver housing market.  They recently updated the game to a second version.  Can YOU tell the difference between a crack shack and a million dollar house in Vancouver BC?

They have agreed to do an open format interview that will let you ask the questions.  Post any questions you have for them in the comment section and vote up the ones you’d like to have answered.  I’ll  send on the top rated question comments to them and post their answers next week.  Ready?  Ask away!

Laadies aaand Gentlemen! Step right up, one and all and ride the bubbliest market in North Americaa!. The Great Vancouver Real Estate Roller Coaster is now open for bizness! Experience the thrills! The Spills! The mind-boggling economic waste of it all!

Front row seats for you only my friend, here’s your tickets:

Here’s a handy financial planning tip: Quit your job and start flipping condos.

You can not go wrong with this simple plan my friend, just look at the facts:

1. BC Jobs don’t pay well.  look at this chart, just look at it.  Our incomes have gone up, but not by as much as in Alberta or Ontario, both of whom get paid much better than us.   At least our houses cost more.

2. Your job may leave you.  Quit it before it quits you.  In January 2009 the Metro Vancouver unemployment rate was 4.9%.  Now it’s 7.8%.  See which way that’s going?  hint: it’s the opposite of house prices.  Make your own secure future in the real estate biz today!

3. The Government wants you to.  If the government didn’t want you to be speculating on real estate they wouldn’t hold interest rates at .25% and insure your mortgage with just 5% down (which the bank will give back to you in cash!) would they? It’s a pretty clear message, the only real road to riches is REAL ESTATE baby!  We can all be Donald Trump!

4. Real Estate Never Goes Down.  This is self explanatory.  Prices have risen tremendously in Vancouver which clearly means it’s a hot sector whose track record is proven.  In March 2010 the REBGV benchmark house price dropped by $455 to only $800,341.  I smell a buying opportunity!

Does this sound exciting to you?  Then YOU are the kind of financial intellect I’d like to work with!

I’m willing to offer you a very special deal for a limited time only.  Send me $15,000 and I will send to you, absolutely free, a handsome inkjet print of these words on a 8.5 x 11 inch piece of paper suitable for framing.  This will empower you to REMEMBER and BELIEVE the words so that they may bring you happiness day after day, even in the event of a completely unforeseeable market collapse.

Now go quit your job and start flipping condos.

Here’s the challenge: Can you tell the difference between a crack shack and a million dollar Vancouver mansion? PetrP created a website quiz where you can test your real estate acumen at crackshackormansion.com.  Being a consumate proffesional I only missed one.  Can you beat my score cold?

Give it a shot.

Remember the excitement of the US housing bubble?  Property values were shooting up and lenders were throwing money at anything with a pulse.  Now that the dust is clearing it seems so silly, but at the time even the ‘professionals’ seemed to think that prices would rise forever without a correction.

One small repercussion of those times is now making itself clear: in the excitement some people forgot to keep track of the records.  At least one delinquent borrower has seen their $460,000 mortgage debt disappear, because the mortgage company was unable to prove they owned the loan.

Here in Canada the CMHC doesn’t seem to be heeding the ‘pumping money into the lower end of the market’ lesson from the US, but I doubt we’ll see this particular mistake made here.  I bet everyone’s keeping immaculate records.

An anonymous reader posted this link in the weekends free-for-all post: Wells Fargo bank is suing itself in Florida court over a mortgage foreclosure case.

In this particular case, Wells Fargo holds the first and second mortgages on a condominium, according to Sarasota, Fla., attorney Dan McKillop, who represents the condo owner.

As holder of the first, Wells Fargo is suing all other lien holders, including the holder of the second, which is itself.

“The primary reason is to clear title and ownership interest in a property to prepare it for sale,” Waetke said in an email exchange. “So it really is not Wells Fargo vs. Wells Fargo.”

Yet court documents clearly label “Wells Fargo Bank NA” as the plaintiff and “Wells Fargo Bank NA” as a defendant.

Wells Fargo hired Florida Default Law Group., P.L., of Tampa, Fla., to file the lawsuit against itself.

And then Wells Fargo hired another Tampa law firm — Kass, Shuler, Solomon, Spector, Foyle & Singer P.A. — to defend itself against its own lawsuit, according to court documents.

Wells Fargo’s defense lawyers even filed an answer to their client’s own complaint.

“Defendant admits that it is the owner and holder of a mortgage encumbering the subject real property,” the answer reads. “All other allegations of the complaint are denied.”

This is even dumber than the lending practices that led to this foreclosure mess, yet this is what the court record says. I learned about this from “The Consumer Warning Network” Web site, which posted an article by Angie Moreschi titled, “Have The Banks Gone Crazy?”

“We’ve apparently reached the perfect storm for complete and utter idiocy by some banks trying to foreclose on homes,” Moreschi wrote.

McKillop, the condo owner’s attorney, told me he thinks Wells Fargo doesn’t know what it’s doing, and that its lawyers figure it is all billable hours to them.

There are a lot of quotes in the media these days from local developers and politicians with variations on the theme ‘nobody saw the Vancouver housing bust coming‘.  This is surprising when you consider how many blogs we have out there dedicated to the concept that Vancouver house prices got way out of hand and are in for the mother of all corrections.

But lets not blame the experts too much, perhaps the extent of their research was a Google search for the term ‘Vancouver house prices‘ which yields this reassuring CBC article as the first result: Vancouver house prices expected to rise 9 percent in 2008.  If you’re expecting a 9 percent increase in house prices, I suppose a 15% drop from market peak could really catch you off guard.

So this is my ‘told you so‘ moment.  Not that the real estate market would see a sharp correction.  Nope, I certainly wasn’t the only one to predict that. Most of the long-time readers here at vancouvercondo.info made the same prediction, as did many other local bloggers, so that’s no unique feat.  I do believe however, that I was the only one to correctly call the Vancouver Bubble Blog Bubble at the beginning of 2007.  Here’s the updated version of that chart along with my count of local bubble blogs:

1. March 2005: Vancouver Housing Blog – the original, closed in Feb 2007
2. Nov 2005: Rob Chipmans – gets a half point for being moderately bearish
3. June 2006: VancouverCondo.Info – Hey that’s us right here!
4. Oct 2006: Vancouver Unrealestate – Looks to be closing down January 2009
5. Dec 2006: BC Housing -Uncertainbuyer closed down end of 2008
6. Jan 2007: Financial Planning and Personal Sanity -now Housing Analysis
7. March 2007: Condohype – Still disowning the lifestyle
8. Dec 2007: North Vancouver Homes – stats and housing market data
9. Feb 2008: Vancouver Real Estate Anecdote Archive – just as the title says
10. Jan 2008: Fishy Real Estate – FishRE closed down the blog in 2008 Q3
11. Feb 2008: Coco News – shared economic news stories, closed 2008 Q3
12. Feb 2008: Vancouver Housing Crash – last post September 2008

Have I missed your favorite Vancouver housing market blog?  Add it to the Wiki!

Our good huckstersfriends at Royal Lepage have issued a press release titled, “Correction, not crash for Canadian real estate market in 2009; Average house prices forecast to fall 3.0 per cent”

You can find the reassuring news here.

Up next, why Joe the Used Car Salesman says it’s a great time to buy a car.

-ReductiMat