Vancouver Condo Info

Bored of real estate? Let’s talk about this website instead!

First off, we heard you on some of the issues browsing this site on an ipad. It was unusable, but now should be much better. We fixed a bug that would not let you vote or view hidden comments on mobile devices. One thing still missing are time stamps and comment numbers, but we’ll go with ‘functional’ for now.

And speaking of hidden comments, it would appear that some people are personally offended by the community voting system in place here. For those of you new to the site, here’s how it works: instead of active moderation each comment can be voted up or down, one vote per reader. Highly rated comments are highlighted and comments with a total negative vote below -8 are hidden. Those comments can be unhidden to read and then voted back up if you want.

When the brilliant Vancouver Real Estate Anecdote Archive went on hiatus someone was unhappy with their recommendation of this site and has been posting this comment around:

I am strongly opposed to the recommendation by Vreaa to move to VCI (Vancouver Condo Info) to post commentary as it is just a hack site of sheep speaking to the same tune as one another and offering little in the way of genuine creative commentary on the Vancouver Real Estate situation. I will admit I have posted there once or twice but I really don’t consider it a useful or intelligent venue for discussion as its focus is popularity centric and voting counts for more than honest dialogue. The conclusion I have come to after only a few brief visits is that you must fall in line with your peers for validity or be cast out and down-voted into oblivion. That is self defeating in my opinion and does not represent true democracy (unless mobs of one-dimensional sheep are considered to be democratic all of a sudden) and it does nothing to foster genuine debtates or discussion. VCI gets my veto. Two very big THUMBS DOWN for that site. I encourage readers to move on to “The Greater Fool” or other open discussion forums that welcome more varied opinion and have a host with an actual personality.

On this site that comment currently has 20 up votes and 15 down votes. I don’t know about you, but I find that a bit ironic

So we obviously can’t please everyone, but our goal is to please the majority of the visitors to this site.

With that in mind (and the recent spate of crap-flooding trolls) it’s poll time!

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Any other thoughts on this site, compliments or complaints? Leave ‘em in the comment section below!

There’s another one of those semantics question articles in the Financial Post:

Canadian Housing: Bursting bubble or gentle landing?

Here’s one chunk of that article with a few asides that always seem to be missed:

Lewandowski believes Canada will not suffer a U.S.-style housing crash simply because policymakers had the benefit of watching it happen next door.

“What we experienced here in the U.S. with housing markets and regulators goes directly to the attitude and changes the minister of finance has made in Canada. A regulator who is being proactive is taking Step One in making sure the housing market doesn’t find itself in a bubble,” Lewandowski said.

So often it seems that ‘bubble’ is used as if it refers to the collapse in prices. It doesn’t. The ‘bubble’ is the inflation of prices beyond reason. By the time the collapse comes the damage is already baked in, falling prices are a correction of the problem, not the problem itself.

Both Bank of Canada Governor Mark Carney and Finance Minister Jim Flaherty have been on the march against a housing bubble for years, aware how low rates and loose lending standards in the United States ignited a boom and bust there.

Well, Carney and Flaherty have definitely been ‘warning’ of consumer debt levels for a while, but government policies like following the US into 40 year zero down mortgages didn’t help to prevent a housing bubble.

The central bank has held rates low since the global financial crisis because growth remains tepid and global woes weigh on Canada’s export market, and Canadians can find a five-year mortgage rate below 3%.

Meanwhile in the states you can lock in to a 30 year mortgage for 3.35%. In fact, while house prices in the US were correcting, interest rates were falling as well.

But the government’s gradual tightening of rules for borrowers — a firm admission that the market was hotter than anyone was comfortable with — has taken some steam out of the market, and economists, like Carney, seem to believe a soft landing may be at hand.

“We’re encouraged by the fact the level of housing starts has come down to slightly below demographic demand, as we see right now, there’s still more adjustments to go,” he said in testimony to Parliament last week. “We’re encouraged by the evolution of house prices in a number of markets. We’re on the path to a balanced evolution of the household sector and we all have to continue to be vigilant.”

Ok, we’ll continue to be vigilant then.

Hey! You made it to the end of another week, let’s do our regular end of the week news round up and open topic discussion thread for the weekend. Here are a few recent links to kick off the chat:

-Lowest April sales since 2001
-Highlights from the REBGV news release
-Realtor Hunger Index
-Inventory Graph updated
-Down by skid row gets cooler
-More Media plants
-When snowbirds attack
-Weather always slows real estate
-Coastal sales/listings 2011-2013

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

BC goes to the polls again May 14 so I took another look at the parties’ platforms to see what they have to say about one of BC’s major economic issues – the housing bubble.

I thought the BC Liberals might be on to something when I saw a section called “Building a Safe, Clean, Healthy and Affordable B.C.” However by “affordable” they don’t mean consumer and RE prices being in line with BC wages. Actually they are talking about taxes, which they correctly state are among the lowest in Canada. But since this is hardly making BC affordable for the average person today, I don’t see what it has to do with making BC affordable going forward.

“Over 1 million low-income British Columbians pay absolutely no income tax today in British Columbia— an increase of 400,000 since our government was elected.” Um, is a big increase in the number of low-income people paying no income tax a good thing or a bad thing? Want to think that over?

“The (forest) industry has been hit by unforeseeable impacts – the pine beetle epidemic, the U.S. housing crash.” The US housing crash was unforeseeable! Now you should just forget about what you thought Paul Krugman, Nouriel Roubini, Peter Schiff and others said. It was only in your imagination.

What the Liberals actually say about housing is that they spent some money on low-income units. Yawn.

BC Liberal platform

On to the NDP. “We’ve seen deep cuts to programs and services that help at-risk children, income assistance rules that claw back modest earnings, and an ongoing crisis in affordable housing.” Aha! The NDP recognizes that housing is too expensive!

Well no. What they mean is that they think there isn’t enough non-profit and co-op housing and they will build more. Which isn’t a bad thing, but it misses the main issue.

“Strengthen and rebalance the Residential Tenancy Act and Manufactured Home Act to better protect tenants and landlords.” Sounds nice, but how do you better protect both sides at the same time?

BC NDP platform

The BC Green Party has basically copied and pasted their housing policy from the previous election, including this gem: “Mandate that BC Housing purchase existing units of market housing that are in current or stalled projects to provide an immediate and expanding pool of permanent below market and market rental housing.” They want to use your tax dollars to bail out developers!

I also think they are confusing the issues by titling the section “Homelessness and Housing Affordability”. These are distinct problems with distinct solutions.

The Greens say more about housing than the other parties but they can’t bring themselves to say that RE prices are simply too high. Their platform starts off by saying that BC needs more voices like Elizabeth May – who I think has actually talked about Canada’s housing bubble. So if she can do it, why can’t they?

BC Green Party platform

And what does the BC Conservative platform say about housing? Nothing. I like that. As Mom said, if you can’t say something good, don’t say anything at all.

BC Conservative platform

When it comes to getting out of debt, Canadians have the best intentions.

But habits are hard to break.

PWC ran a survey last year where 64% of the people intended to cut their debt levels.

Unfortunately the follow up this year shows that only 23% had any success in doing so, 26% reporting that they were ‘completely unsuccessful’.

Noting that the current debt-to-income ratio sits at more than 160 per cent, the consulting firm called the trend to higher debt levels “unsustainable” for consumers.

“Similar with any diet, saying you’ll cut back and make better choices is one thing, while actually doing it is quite another,” said John MacKinlay, a national financial services consultant at PwC.

“We advise Canadians to take a hard look at their discretionary spending and prepare to make some tough choices on where to trim the fat.”

Read the full article here.

Johnny O pointed out this CBC feature on ‘the Monarchs of Money‘.

Central Bankers pulled the global economy back from the brink of a debt laden collapse by printing money.

Where does this lead and who benefits?

Quietly, without much public fuss or discussion, a new ruling class has risen in the richer nations.

These men and women are unelected and tend to shun the publicity hogged by the politicians with whom they co-exist.

They are the world’s central bankers. Every six weeks or so, they gather in Basel, Switzerland, for secret discussions and, to an extent at least, they act in concert.

The decisions that emerge from those meetings affect the entire world. And yet the broad public has a dim understanding, if any, of the job they do.

In fact, these individuals now wield at least as much influence over the lives of ordinary citizens as prime ministers and presidents.

Read the full article over at the CBC.

Some people express a lack of faith in current house prices by delaying buying or moving to better economic climates.

Others might make a friendly wager with a co-worker that house prices will be lower in 2014 than they are in 2013.

But how confident are you that a market correction will occur not just in Vancouver, but all across Canada?

And even if the national market corrected sharply do you think that would have much impact on our banks or would CMHC insurance protect them from any dramatic losses?

Do you really think a housing market crash would have as much effect on our economy as it did in the USA?

Would you be willing to bet 95% of your assets on the likelyhood of such an occurrence?

Vijai Mohan has made an all-in bet against Canada.

The founder of a small San Francisco-based hedge fund called Hyphen Partners LP has staked 95 per cent of his investors’ assets on a wager that the country’s housing market and banking sector are about to come apart at the seams. Mr. Mohan has amassed large short positions on Canadian bank shares and the loonie, betting their values will fall sharply.

“Canada faces two risks,” said Mr. Mohan in an interview. “Very few people are looking at those risks simultaneously. That collectively presents a lot of opportunity” – for someone looking to profit from Canada’s misfortunes.

Read the full article over at the Globe and Mail.

Hey, It’s the end of another work week in the province formerly known as the best place on earth!

Let’s do our regular end of the week news round up and open topic discussion thread for the weekend.

Here are a few recent links to kick off the chat:

-Inventory chart updated
-Found a clue!
-Bidding wars in a slump?
-Historical price/rent to ’84
-EA closing vancouver studios
-Loophole for the PTT
-The Hong Kong tax treaty
-Canada vs US fundamentals
-Ready for the next global slowdown?
-Island foreclosures
-Silverstoned

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

Frances Bula has a good summary of the current state of debt on the Olympic Village.

The City of Vancouver hasn’t made it terribly easy to find out where we are in terms of paying for that mess, but with a little sleuthing it would appear we’re actually making good progress to pay off the $750 million construction loan the city took out.

Just $300 million left to pay on that debt.

Both Mr. Meggs and city manager Penny Ballem say it’s impossible to predict whether the remaining 181 condos (as of Dec. 31, 2012) and transferred Millennium properties will do more than cover the last $300-million of the outstanding debt (that figure was $462-million at the end of 2011).

If so, the remaining $171-million the city expected to get from Millennium for the land will never materialize.

So the city may never see any money for the land the Olympic Village was constructed on but hey, look at that beaver!

If you’ve made money by flipping condos or selling assignments for presales projects you probably already know that’s income.

If not the Canada Revenue Agency would like to remind you:

“We do from time to time target some sectors more closely than others,” he said. “We look at the real estate market in general. Of course, [there is more focus], it’s a hot market.”

Thats Sam Papadopoulous, senior public affairs advisor-manager with CRA’s Ontario region quoted in this Financial Post article.

“If you keep [assigning property] then it is not capital gains, that’s trade and that’s income,” said Mr. Papadopoulous, adding you do it a “couple of times” and it’s income. “Of course, that’s part of [what they are investigating].”

“We live in the information technology age,” said Mr. Papadopoulous, who wouldn’t get into how CRA is tracking down the tax evaders. “We are putting our resources to work and following the trail where we can.”

Read the full article over at the Financial Post.