Dominick Page Thoughts

Looking Back: Seventeen Years, One Thesis, and a Market Finally Reconciling With Gravity

Fri, 17 Jul 2026 21:35:10 GMT

When this blog started, back in 2008, the idea was modest: collect anecdotes. Stories from the trenches of a housing market that had, even then, begun to detach from anything a sober person could call fundamentals. “He said, she said.” “Profiting from the boom.” “Where do buyers get the money?” We built categories for them and filled those categories, over the years, with thousands of posts and something like a quarter of a million comments. The blog became, almost by accident, a diary of a mania — a slow-motion social document of what a whole city does when it convinces itself that shelter is a lottery ticket.

At the end of 2009 we broke our own rule. Instead of archiving somebody else’s story, we posted a prediction: that a real estate bear market would be Vancouver’s defining social and economic event of the coming decade. We laid it out like a play in three acts — the background stories (“Best Place On Earth,” “Running Out Of Land,” wealthy foreign buyers, “Real Estate Always Goes Up”), the stage-setting conditions (rent-to-price and income-to-price ratios at historic extremes, both suggesting housing was more than twice overvalued), and the coming action (rising supply, tightening credit, price falls, seller panic, a multi-year grind back toward fundamentals).

We gave that scenario an 80% probability. We were, as we’ve wholeheartedly admitted since, spectacularly early. This post is an attempt to ‘mark our own homework’: out loud, against the numbers as they actually stand in the summer of 2026.

First, the confession we’ve already made

There’s no dressing this up, and we won’t try. The “coming decade” we named was 2010–2019. Prices did not collapse in that window. They roughly doubled. The very crisis that should have pricked the bubble — the 2008 global financial meltdown — instead delivered a bailout Vancouver didn’t need, in the form of emergency-low interest rates in early 2009. That was the first booster shot. The COVID free-money era of 2020–2021 was the last one, and it launched prices into what we called, at the time, the stratosphere.

So the bears — us included — spent a decade and a half being early, which in market terms is indistinguishable from being wrong. We take our lumps. As we put it when the blog stirred back to life in late 2025: our bearish calls were early “by something between 6 and 15 years, depending on how you measure.” A commenter in 2018 wrote in to tell us flatly that “all the doomsayers have been proven wrong.” At the time, he had a point. Anyone who sat out the 2010s waiting for our crash paid dearly for the privilege — in rent, in anxiety, and in the corrosive “coulda-shoulda-woulda” that we warned all along was the second lesson every market participant has to learn to survive.

We say all of this first because a retrospective that only counts the hits is propaganda, not analysis.

And now, the part where the thesis holds up

Here is where it gets interesting — because getting the timing catastrophically wrong is not the same as getting the structure wrong. And on structure, the record reads very differently.

The core claim of this blog was never really “prices crash next year.” It was something more durable: that Vancouver housing was priced two to three times above the level that local incomes and rental yields could justify, that this gap was the product of a speculative mania rather than genuine scarcity, and that the reconciliation with fundamentals — whenever it came — would be the defining economic story of the city. Let’s test each piece against 2026 data.

On overvaluation. The 2026 Demographia International Housing Affordability report gives Vancouver a “median multiple” — median house price divided by median household income — that has hovered around 11 to 12 in recent years, placing it among the four least affordable major markets on earth, behind only the likes of Hong Kong and Sydney. Demographia calls anything above nine “impossibly unaffordable.” The historically-normal, genuinely-affordable multiple is three to five. In other words, the independent international benchmark now says Vancouver is roughly two-and-a-half to three times overpriced relative to income — which is, almost to the decimal, the number this blog was shouting into the void back in 2009 and 2010. National Bank’s affordability monitor tells the same story from another angle: as of early 2026, servicing a mortgage on a typical Vancouver home still eats about 82% of median household income, against a long-run norm closer to 40%. The overvaluation we described was real. It was never a hallucination of “permabears.” The metrics were always there; we just read them a decade too early on timing.

On the reconciliation, now underway. This is the headline. As of June 2026, the Real Estate Board of Greater Vancouver’s composite benchmark sits at $1,099,100 — down 6.0% year-over-year, and roughly 12% below the April 2022 peak of $1,252,800. That top-line number understates what’s happening underneath it:

– Condos have been sliding for more than four years. Rennie’s economists peg the segment at around 11% off its spring-2022 peak and still falling — “more than 48 months into this downturn.”

– The Fraser Valley — the suburban frontier where the mania spread last and hardest — now sits about 26% below its 2022 peak.

– Presale buyers who signed at peak prices are facing $100,000 to $500,000+ losses on assignment at completion, with some projects marked down 15–25% from original pricing.

– Sales hit 25-year lows in 2025, inventory has climbed to multi-year highs, over 80% of homes sold below asking, and days-on-market have stretched out. This is not a healthy, tight market taking a breather. It is a market where, as we wrote in point 29 of last December’s “33 Concepts” post, the buyers’/sellers’ indicator will “stick to the wall all the way down.”

And the West Side detached mansions — the trophy assets, the ones most freighted with 2022 optimism — are the tell. Houses selling for less in nominal dollars than they fetched in 2013, 2015, and 2016. Adjust for the roughly 28–30% of compound inflation over that decade, and a buyer who paid $4.5 million in 2016 and sold for $3.1 million in 2026 has lost something like 47% in real terms — before carrying costs. The reconciliation with fundamentals we always said would be “brutal, in all segments” is no longer a forecast. It’s a data series.

The most remarkable development of all

If you had told the 2009 version of this blog that one day the Bank of Canada itself would say, out loud, that “there is no path to affordability in Canada without home prices coming down” — we would not have believed you. The entire architecture of the bubble, as we catalogued it for seventeen years, depended on vested interests insisting the opposite: that prices must always rise, that any softening was a buying opportunity, that a “soft landing” was not only possible but assured.

Yet here we are in 2026, with the central bank conceding the quiet part, with the CMHC having earlier called for prices to fall, and with mainstream columnists writing matter-of-factly about a decade of stagnation at the top end. The narrative has flipped. That flip — the culture finally releasing housing from its grip on the collective mental space, “RE vacating social dialogue” as we phrased it in Act Three — may be the single most important thing to have “come to pass” since we started writing.

So where does that leave us — and the thesis?

The bubble did not “pop” in the cinematic sense we half-expected in 2010. There was no single 2008-style crash. Instead, after two undeserved bailouts extended the mania by fifteen years, we are now several years into exactly the kind of grinding, multi-year, sentiment-driven deflation that we described in Act Three and again in last winter’s 33 points — prices reverting toward fundamentals not in a weekend but in a long, wave-upon-wave descent. Rates have been cut (the overnight rate is down to the mid-2% range from its 2023 peak), which in any prior cycle would have relit the fire. This time it has produced only stabilization and sideways drift, not a new boom. That, more than any single price print, is the evidence that something is structurally different — that the psychological engine of “buy now or be priced out forever” has, for now, stalled.

Are we declaring victory? No. We got the timing so wrong that we forfeited the right to any victory lap, and we said as much in point 33 of the concepts post: not so fast — we could be wrong, yet again. Perhaps prices turn on a dime and rocket from stratosphere to orbit.

But the shape of what we described — overvaluation of roughly 2–3x, driven by local leveraged speculation dressed up in scarcity narratives, unwinding into a prolonged reconciliation that reshapes the city — is no longer a fringe bear fantasy. It is, increasingly, the base case of the Bank of Canada, the CMHC, and the Vancouver Sun.

To the old regulars, the bears who somehow made it through all of this: how ya doin’? Pull up a chair. After seventeen years, the beast has finally woken up. It was never going to be pretty, and it isn’t. But for the first time, the numbers are moving in the direction we always argued gravity demanded.

As ever: a home is first and foremost a place to live. If this whole long, painful cycle teaches the city that one thing, it will have been worth documenting.

— vreaa

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A note on sources: current figures in this post are drawn from the Real Estate Board of Greater Vancouver / Greater Vancouver Realtors June 2026 release, WOWA.ca’s market summary, the National Bank Housing Affordability Monitor (Q1 2026), the 2026 Demographia International Housing Affordability report, Rennie market commentary, and reporting in the Vancouver Sun and Business in Vancouver. Figures are benchmark (HPI) prices unless otherwise noted; averages differ and can be skewed by sales mix.

This Guy Gets It – “These Values Are Artificial” – Joseph Barbuto on ‘The Really Big Show’

Thu, 04 Jun 2026 00:22:40 GMT

RE Bubbles; Record debt; About 50% overpriced; Collapse inevitable; Return to 2-4x income; Bail-outs essentially impossible…

Interview with Joseph Barbuto on ‘The Really Big Show”

As we have been saying, for too long…

“Metro Vancouver’s priciest housing has stagnated for a decade” – Vancouver Sun

Sun, 03 May 2026 01:14:58 GMT

“…many houses valued in the $3 million-to-$5 million range on Vancouver’s west side, and in West Vancouver, are selling for less than they did more than 10 years ago.” – excerpt from the article by Vaughn Palmer

Examples from the article:

A mansion in the 2500-block of West 36th Avenue in Vancouver sold for $4.4 million in 2013. This year, it sold for less [than] $4.3 million.

An older dwelling on a large lot in the 2200-block of West 44th Avenue in Vancouver sold for $4.5 million in 2016. It sold for significantly less last month, at $3.1 million.

A view house in the 2100-block of Westhill Place in West Vancouver was bought for $2.8 million in 2015. It just sold for $2.5 million.

Keep in mind that, over those same 10 years, compound inflation has increased prices of consumer goods in Canada by about 28-30% (and inversely weakened our dollar buying power). Thus to break even in real terms that $4.5 million 2016 purchase on West 44th Ave should have sold for $5.8 million in 2026. Instead, it sold for $3.1 million. Thus in real terms, the 2016 buyer has lost 47% of their ‘investment’. And that does not include transfer and any mortgage carrying costs. The reconciliation with fundamentals is going to be brutal, in all segments of the market. – vreaa

“We Need Housing Prices To Come Down” – Bank of Canada(!)

Thu, 19 Mar 2026 14:30:19 GMT

The Bank of Canada just said the quiet part out loud:

There is no path to affordability in Canada without home prices coming down.

Housing is already weakening.

No one is coming to save this market. pic.twitter.com/RyaadFlB9e
— Shazi (@ShaziGoalie) March 18, 2026

Never thought we’d hear that so clearly from these guys.

As we said in the 33 point post: Affordable housing? Nothing that a good clean speculative-mania collapse cannot sort out. Once the dust clears (and it will take years), we are likely to go through a period where housing is again priced near fundamental value. This will ultimately be good for the society, and hopefully we will have learned from the entire cycle. The path getting there will be gruesome, however.

[Thanks to Shazi for the above clip. Worth following that account for examples of price reductions, some even to 2009 levels].

On the way down, do not be misled by ‘buyers’ market’ descriptors…

Sun, 08 Mar 2026 23:03:51 GMT

Sellers’ and buyers’ markets, in RE agent parlance, are defined by inventory:sales ratios. Currently there has been a surge in inventory and a very large drop in sales – but prices have only modestly softened. Already we have hopeful realtors calling this a ‘buyers’ market’. Do not be fooled – you will hear these calls all the way to the bottom – this indicator will ‘stick to the wall’ all the way down, as panicked sellers pile on the inventory and most buyers sit on their hands (remember: speculators hate falling prices). A true buyers’ market will emerge when prices approximate levels determined by fundamentals.

[above is point 29 from: Understanding the Vancouver Housing Market Crash]

Understanding the Vancouver Housing Market Crash

Mon, 15 Dec 2025 07:20:57 GMT

The following 33 concepts will help you understand what is currently going on in the Vancouver RE market. – vreaa

1. A home is simply a place to live

A home is first and foremost a place to live – that is its core purpose and ultimately its real value.

2. A home is a basic human need

It’s odd that a society obsessed with the importance of human needs such as clean air, water, food, childcare, education, and healthcare can allow a similarly basic and important human need – shelter – to become a speculative vehicle, for decades.

3. You can calculate the fair financial cost of a home

Housing’s fundamental fair-value pricing can be calculated from historical ratios of (i) local wages and (ii) rental yields. By those measures, and even taking into account recent price weakness, Vancouver homes of all types remain among the most overvalued globally, and can be argued to be roughly two to three times overpriced.

4. Some people will pay a bit more for the benefits of ownership

People may be prepared to pay for the convenience and (in some cases) pride of owning over renting, but this usually modest ‘ownership premium’ does not alone result in prices that are wildly higher than fundamentals justify.

5. Commonplace use of extreme leverage is unique to the housing market

Leverage – borrowing heavily to buy – is routine in housing. The 10-to-one or even 20-to-one leverage that is common in RE (10% down or 5% down respectively) is justifiably seen as cowboy-level risk taking in other markets. Try getting that kind of basic leverage in a margin stock account. RE is the only way in which most citizens are exposed to leveraged investing. And it works seemingly magically on the way up … a young couple’s entire net-worth may double in a year where housing prices leap 5% or 10%. But on the way down, leverage is hellish. This large leverage/deleverage phenomenon is a central factor fuelling both the virtuous and vicious stages of a bubble.

6. Unusual housing tax incentives tempt and drive buyers

Tax-free capital gains on principal residences create big incentives to buy at any cost. In a social system that aims to tax fairly across the board, why fuel speculation in homes by tempting buyers with the promise of this massive reward? And the rewards are indeed outsized – in recent years, in many parts of Vancouver, millions of dollars tax free. How long does it take an average Canadian household to save a million dollars, after tax? A lifetime? A fairer system might only shield long-term gains that match core inflation.

7. Mortgages stimulate an economy in a profound and unearned fashion

Where do mortgages come from? Answer: Banks create them out of thin air through their lending under our fractional banking system. Most people, even those amongst the most educated members of our society, are unaware of this fact. Test this by asking some of your friends. Most believe mortgages come from other people’s savings. In actual fact, they are created from almost nothing, in the process essentially expanding the money supply (and, yes, fuelling inflation). This results in an economy looking far better than its fundamentals merit, as a bubble expands. Sellers suddenly have large amounts of money to spend now, that they did not earn in any conventional sense. Of course, on the other end of the deal a buyer has promised to pay all this back, but that’s in the future.

8. Decades of unusually low interest rates misprice risk and encourage speculation

Artificially low interest rates since the late 1990s – thanks to celebrity central bankers egged on by eager politicians – made borrowing cheap and fuelled endless price growth. The cost of borrowing was mispriced; citizens could borrow and risk the capital without proportionate consequences. We experienced serial asset bubbles (tech, US housing, everything, AI). Interest rates are still low by historical standards, even though many are complaining that they are ‘too high’ compared with record lows of recent years. The current 5 year rate is ball-park 4%; the average 5 year rate from the 1950s to the present is about 8%.

9. A Speculative Mania

Speculation means buying largely for price appreciation, rather than primarily for income or use. Prices rise beyond those determined by fundamental values. Rising prices draw in more buyers, FOMO kicks in, ‘animal spirits’ take over, and pretty much everyone is dragged into the vortex. We have long maintained that everybody buying in Vancouver, over the last 20 years or so, was doing so with the conscious or unconscious expectation of continuous unrealistic price gains. This applies equally to buyers who argued that they were simply buying for use – the truth is that they would never have contemplated buying at mania prices if they thought that prices may stay flat, or (unimaginably) decrease. They bought based on the assumption of price gains. This local-buyer speculative component was a powerful force driving the market.

10. Stories that Fuelled the Vancouver Bubble

“We are running-out-of-land”, “we are the best-place-on-earth”, “rich foreigners will buy everything”, “endless immigration”. These themes in various combinations were touted widely as reasons for the astronomic prices, and reasons to expect prices to rise indefinitely. Some actual effects in all of these, but more important was the way that these narratives drove relentless buying/speculation by locals.

11. Serial undeserved and unnecessary bailouts

Vancouver RE received a bailout-shot-in-the arm in the form of very low interest rates in early 2009, when it didn’t even need it. This resulted in the second booster stage of the bubble. The ridiculously loose money of the COVID pandemic has proven to be the last booster shot, causing the 2021-2022 blowoff. We quipped at that time that all Vancouver RE prices would need to truly go into orbit would be a devastating earthquake. Price corrections thus far appear to have removed the COVID blow-off part of the bubble – but prices are still in the stratosphere.

12. Taking a second job as landlord/property manager in order to buy

Many owners became unintended landlords, buying properties with rental suites just so they could stretch to make the mortgage payments and get into the market. Thus citizens routinely got to use only a fraction of their home, and took on a second part-time job (informal property manager) to be part of all this. Many homes became de facto businesses. Is this really how we choose to live, and to spend our time?

13. Shady borrowing and lending practices further increased price pressures

One income supporting a series of mortgages. Using equity from one property to leverage the next. Fraudulent income declarations to secure larger loans. Blind-eye to the same from the lenders to compete for business.

14. No intention whatsoever to actually repay the mortgage debt

Market historians will have heard stories from a half century ago, of ‘mortgage burning parties’. This was where home owners got together with friends and celebrated finally paying off their debt. “What losers!”, thought Vancouver speculators of the last 20 years. Didn’t people know that mortgages could simply be rolled over, and finally eclipsed by the massive gains in housing prices when you sold? Why bother to pay down your debt with actual earned money, when your appreciating house value could look after all that for you? [These assumptions, of course, get very rudely destroyed when prices plunge.]

15. There is no shortage of land in Canada, only a shortage of will to use it

Aliens (both those from other countries and those from other planets) are confused – why does a country with the second largest landmass on the planet, and such a low population density, not take advantage of this useful resource? We are most certainly not ‘running out of land’.

16. Vested interests push up prices and benefit from unaffordability

Politicians with multiple properties, realtors posing as neutral experts, media dependent on developer advertising, vocal elites with massive RE ‘portfolios’, influential boomers dependent on the value of their houses for their retirements, many other examples: all have interest in keeping the market hot and prices high. Don’t expect those in positions of influence to take any real action that may make housing affordable. True affordability would have to mean that prices would fall to the vicinity of fair fundamental value levels. Witness the first public statement by the current Federal Minister of Housing (ex-Vancouver-mayor [2008-2018] Gregor Robertson): not to worry, housing prices will not come down. He happens to own multiple BC properties.

17. Realtors are almost never impartial, and show bullish bias

Realtors earn from transactions, not from getting either the buyer or the seller the best deals. Realtors want volume; and they get the most volume in an optimistic, bullish market. Witness the market pause and reduced sales of 2025. Take any opinion, advice, or forecast from anybody in the RE industry with a grain of salt the size of your head.

18. A Real Estate Bubble causes a vast misallocation of resources

A housing bubble sucks the oxygen out of other activities in the society. Talent and capital is distracted… and flows into real estate. Professionals, distracted by stories of massive gains, become condo flippers. Youth become roofers for quick cash (and F150s!) instead of studying to become nurses or engineers. Capital is diverted from innovation, industry, manufacturing. The economy becomes overdependent on activity related to RE: by many calculations this sector swells to over 20% of all of BC’s economic activity.

19. In a bubble everything to do with housing goes up in price, because it can

Prices increase at higher rates than inflation in construction, renovations, landscaping, yard care, condo maintenance fees, etc. Owners see their property values increase in leaps and bounds, and these expenses seem relatively affordable and appropriate – they are easy to ignore. In a related effect, demand for services increase, and the quality of many housing related goods and services appear to go down.

20. Housing invades mental space and defines the culture

A multi-decade housing bubble takes up a massive amount of mental space, both for those ‘in’ or ‘out’ of the market. It starts defining a culture. News anchors declare that they ‘love’ real estate. Social interaction is commonly dominated by talk of housing prices, unrealized profits, renovations. Infatuated owners spend an inordinate amount of money and time caring for or refurbishing their homes, which are now their most important ‘investments’. Renters experience chronic anxiety; they anticipate forever being disenfranchised. Sleep is affected. How much does a society suffer from all of this distraction and unproductive activity? Consider how far this is from the default: “A home is first and foremost a place to live”.

21. Owners and renters become two different classes of citizens, often on generational lines

The bubble divides the society. On paper, there emerges huge wealth inequality. Inter-generational conflict festers. Boomers’ retirement hopes (ridiculously high prices) clash with younger generations’ shot at a normal life (prices at fundamental values). Essentially the boomers are asking the youth to fund their retirements by overextending into RE and taking on massive debt for life. Discouraged young people leave town. Owners hunker down and try to protect their paper gains. Politicians express concern about social consequences with sober frowns, but affordable housing talk remains nothing more than talk.

22. Unintended (and not immediately apparent) consequences

Your family doctor, instead of working until 70 to build their retirement nest-egg, retires comfortably at 56 after cashing out by downsizing their primary residence and selling their large clinic space in 2022. Recall prominent architect Bing Thom’s comment on making more money on his Vancouver home than by working “an entire lifetime”. “This tells you something”, he said.

23. Wealth effect spending further boosts the economy

Owners track the prices of comparable properties, feel rich on paper and spend accordingly. They ignore the need to save and perhaps even build further debt against their home. This makes the economy look stronger than it actually is.

24. Bubbles always end

They are destined to end once they start. When they do start deflating, participants will invariably look for triggers and reasons. Currently they blame tariffs, land claim uncertainty, immigration slowdowns, the exposure of fraud & money-laundering, youth emigration, etc. All of these factors may contribute to a market slowdown, but they should not distract one from understanding that the underlying structure of a bubble is ultimately unsustainable, and will at some point have to collapse, even without external cause.

25. Timing the top is impossible

The market can stay irrational for a long, long time. At the end of 2009 we predicted that the bubble would pop by 2019… out by an outrageous 6 to 16 years, depending on how you calculate. And, yes, retrospectively it would have been better to have purchased in 2005… or 2001… or 1996… but retrospect is cheap. The second lesson any market participant must learn (after learning about speculative manias) is that one has to learn to get over that ‘coulda-shoulda-woulda’ feeling as painlessly as possible.

26. Vicious cycles then follow; the downward-spiral is self-reinforcing

Negative equity, forced sales, banks protecting themselves, construction grinding to a halt, jobs vanishing, incomes dropping, rents falling, prices resetting lower; rinse and repeat until all speculation is flushed from the market. When prices are falling, speculators vanish – and a market that has been based almost solely on speculation implodes.

27. Price targets are lower than most can imagine

When big bubbles burst, prices often eventually drop to below fundamental values (over 50%-off from current Vancouver prices). These price targets look impossible to all but dedicated students of market history. Prices revert to the mean. Prices drop to levels supported by fundamentals. Prices drop until all bullish sentiment is completely squeezed out. All manias end like this. In RE it can take many years. We currently have (rare) predictions from industry insiders of price drops for the coming year; of the order of 4% for Vancouver. Four percent is noise, not even a correction.

28. A market that is suffering the effects of a deflating speculative mania cannot be rescued

A popping bubble involves so many powerful self-reinforcing forces that, once underway, it will simply play itself out. Attempted rescues may alter the course somewhat, but are unlikely to change the ultimate outcome and real-price targets.

29. On the way down, do not be misled by ‘buyers’ market’ descriptors

30. In the aftermath, housing may genuinely become affordable again

Affordable housing? Nothing that a good clean speculative-mania collapse cannot sort out. Once the dust clears (and it will take years), we are likely to go through a period where housing is again priced near fundamental value. This will ultimately be good for the society, and hopefully we will have learned from the entire cycle. The path getting there will be gruesome, however.

31. The human cost of a deflating RE bubble is brutal

Bankruptcies, shattered retirement plans, vanished paper wealth, and a lot of regret. Everybody suffers, in different ways, and at different times. Broadly, bulls can be destroyed in the bust; bears were massively inconvenienced and distressed during the run up. But literally everybody suffers when living in a society weathering a bubble deflation and aftermath.

32. We should try to discourage speculative manias, especially in basic needs

In the end, this is why everything possible should be done to minimize the risk of market manias in future. Humans will always be vulnerable to ‘animal spirits’ and attracted to get-rich-quick schemes – but we could take measures to ensure that structures within the real estate markets, the financial system, the taxation system, and perhaps even education, deter rather than fuel such manias.

33. Not so fast… we could be wrong (yet again)

Perhaps Vancouver RE prices will turn on a dime and boost from stratosphere to actual orbit. But, this time, it does seem like something is genuinely ‘broken’. We will see.

– vreaa

The Beast Awakens From Its Slumber…

Sat, 29 Nov 2025 02:30:28 GMT

Awakened by lots of knocking. Clearly something is up in Vancouver – and Canadian – RE.

OK, so forgive us: our bearish calls were early by something between 6 and 15 years, depending on how you measure… but, hey!, “no one can time a top”, “the market can remain irrational for longer than you can remain solvent”, etc, etc…

Despite getting the decade a tad wrong, we are now again concerned that “For our city, this RE crash will quite likely be the defining social and economic event of the next decade“

We will put up a post soonish regarding a current understanding of the Vancouver RE market… until then, any old regular readers/posters out there ? Any bears make it through all this? How ya doin’?

“I’m surprised that everyone else is so surprised to hear anyone talk about a housing bubble” – “Canadian RE 2021 worse than U.S. bubble at 2006 peak” – David Rosenburg

Thu, 25 Mar 2021 16:08:03 GMT

“I’m surprised that everyone else is so surprised to hear anyone talk about a housing bubble…”

“Housing prices went up 17% in a year where underlying wage growth is stagnant…”

“I called the bubble in the US in 2005-2006… I was looking at price to rent ratios, I was looking at price to rent ratios… household exposure to RE… I’ve got news for you… the numbers in Canada now are worse than they were in the US 13 years ago”

[asked about colleagues who say there is a “bubble in calling bubbles in Canadian RE”] “Bubbles can go further than you think, but they don’t correct by going sideways…”

“I listen to… Stephen Poloz [BOC governor]… it’s like listening to Ben Bernanke in 2006 when he told everybody “Oh, don’t worry… house prices nationwide never go down“..

“Bubbles can last a long time, but we’re in a very unstable situation”.

excerpts from economist David Rosenberg’s Bloomberg interview, 24 March 2021

“Always the Right Time to Buy!” – Cheap Rope For Vancouver RE Buyers

Fri, 19 Jun 2020 21:24:25 GMT

As a mortgage agent, Lorina Serafico, a home-financing adviser with Scotiabank, often gets asked when is a good time to buy a home.
“If a household has the income, down payment, and the credit score to qualify for a mortgage, it is always the right time,” she said.
According to Serafico everyone needs a home, whether owned or rented.
“I consider mortgage payments as a forced savings plan,” Serafico said. “A $500,000 property you bought today will be worth $873,000 in 10 years. That’s an average of 7.45 percent annual increase, beating a medium-risk investment portfolio.” …
With more than a decade as a mortgage agent, Serafico has served numerous customers, and a number of them have started meeting with her again.
They’re usually owners of townhouses and condos, and now they’re thinking of upgrading to single-family homes.
“They like what is happening in the market. There’s more inventory; prices have stabilized; and interest rates are good,” Serafico told the Georgia Straight in a phone interview.
On March 27 this year, the Bank of Canada slashed its key interest rate—which determines bank lending rates—to its lowest level of 0.25 percent.
– excerpt from ‘Mortgage holders can seize on opportunities to upgrade’, Carlito Pablo, Georgia Straight Vancouver’s News & Entertainment Weekly, 17 June 2020

“It’s hard to make predictions, especially about the future.” – attributed to Yogi Berra.
One would think that people, especially finance professionals, had learned not to say things like “…it will be worth…”, “…7.45%…”, and “…always…”.
– vreaa

Mortgage Squeeze Anecdotes – “Two days ago my mortgage holder called and told me that, after 22 years, they would not renew my mortgage.”

Fri, 05 Jun 2020 19:37:02 GMT

“Two days ago, my mortgage holder (a Credit Union, no less) called and told me that after 22 years, I was no longer an “A-list” borrower, and they would not renew my mortgage. I have no credit cards, never late with a payment, never late with utilities, taxes, etc., etc., BUT, because of the ‘new’ mtg. rules, they could not renew my mtg. because two years ago (as a result of a series of family crises), I took a small 2nd mtg. (ridiculous rates, but I’ve met EVERY payment, etc. – the credit union wouldn’t ‘help’). My total debt is only the two mtgs. against the property and, together, they are less than 1/2 of my equity (compared to the assessed value).
My son (who is on disability) lives with me and takes care of me (as I do him), and we share our expenses with our two limited incomes. I’ll be 73 in a couple of weeks, am not well, have been isolated at “home” since the beginning of March. None of that ‘counts’.
Nor does it ‘count’ that for over 50 years, I’ve been involved in environmental and social justice issues, worked pretty much full time my whole life (never collected EI, even!), contributed to my community (have received awards), raised a family, supported many others in crisis.
In a month, I, and my son, could be homeless. I don’t even have the strength to champion my own personal needs.
To those of us that are experiencing the REALITY of the NOW – those living in corrupt care homes, or homeless, or helplessly addicted, or victims of genocide or poverty, or racism, what it’s “called” is moot.
— from commenter ‘dda’ 30 May 2020, under the article, ‘Normal Is The Problem’, by Andrew Nikiforuk, The Tyee, 30 May 2020

Also see:
A Confluence of Whammies: A Single Realtor (& Airbnb-host) with a dependent child, an elderly dependent parent, two lost tenants, and dwindling business is forced to sell their house (presumably at a loss) and take a $30,000 mortgage penalty.
TD Bank charges $30,000 mortgage penalty to woman forced to sell home due to pandemic – 1 Jun 2020, CBC News.

Your banker may seem like a friendly guy, but the banks will always look after themselves – first and last. – ed.

Wow! – CMHC CEO Evan Siddall Points To Unsustainable Debt & Calls For 18% Drop In Housing Prices – [which of course would mean a lot more off]

Fri, 22 May 2020 21:14:53 GMT

According to CMHC estimates, the ratio of household debt to GDP in Canada could reach 130 per cent in the third quarter of this year, a sharp increase from around 99 per cent before the pandemic. Debt as a share of disposable income, meanwhile, could also rise precipitously to 230 per cent in the third quarter, up from 176 per cent.

Siddall said those ratios are well over a critical 80 per cent threshold, above which “the Bank for International Settlements has demonstrated that national debt intensifies the drag on GDP growth.” Such high debts risk future economic growth by “effectively converting future consumption into debt service payments,” he said, at a time when households and governments are increasingly leveraged.

Adding to real estate concerns amid COVID-19, the agency also sees housing prices plummeting in the next calendar year.

“The resulting combination of higher mortgage debt, declining housing prices and increased unemployment is cause for concern for Canada’s longer term financial stability,” Siddall said.

The CMHC sees housing prices declining between nine and 18 per cent over the next 12 months. Those estimates are loosely in line with an earlier projection by DBRS Morningstar, a credit rating agency, says which says housing prices could fall between 10 and 15 per cent by 2022.

By way of comparison, the owner of a $300,000 home at a five per cent down payment could lose around $45,000 if housing prices fell by 10 per cent, Siddall said.

He said the agency is “debating whether we should change our underwriting policies” as a result of the pandemic, potentially restricting the future lending environment as debt levels soar.

“Our support for home ownership cannot be unlimited,” he said. “It’s like blood pressure, you can have too much, [but] you need some.”

– excerpt from ‘Bloody terrifying’: COVID-19 will raise household debt levels and ‘drag on GDP growth,’ CMHC warns’, Jesse Snyder, 19 May 2020, National Post

Remarkably straight talk from the organization that has played such a large part in extending rope to participants over the last 20 years. And we’d guess that ‘18%’ is just a best guess estimate of the first step. As we’ve postulated over the years, when the bubble bursts, few are going to step in and overextend themselves to go into debt to buy assets that are falling in value yet still very overpriced by every metric. The Vancouver market has been predicated on prices that only go up, and the result has been prices that are about three times those determined by fundamental utility value. Once the drops start, we see no way of this all bottoming at 18%-off. In Vancouver, the direct and indirect economic effects of a drop of 18% in RE would alone almost definitely guarantee a larger drop.
– vreaa

Prediction: Vancouver RE Prices Will Not Crash… Unless They Crash

Fri, 15 May 2020 15:10:13 GMT

“If homeowners can just hold off selling, the Canadian housing market will emerge fine from its current “deep freeze”.
According to a recent TD Economics housing forecast update, the market is expected to gradually recover from the effects of the COVID-19 pandemic.
After an anticipated “historic” plunge in sales in the month of April 2020, a “much stronger activity” is seen next year.
A lot of that depends on whether homeowners can avoid distressed selling during this pandemic.
“Absolutely key to our forecasts is the assumption that listings mirror sales by dropping substantially in the near-term and recovering gradually thereafter,” Rishi Sondhi, an economist with TD Economics, wrote.
By holding off on selling, homeowners can do one thing for the market.
“This puts a floor on prices and sustains relatively tight-supply demand balances across most markets, allowing for the resumption of positive price growth as provincial economies are re-opened,” Sondhi explained.”
– excerpt from ‘Homeowners avoiding distressed selling key to Canadian housing market recovery: TD Economics’, Carlito Pablo, 1 May 2020, Georgia Straight

No, folks, that ‘analysis’ is not from ‘The Onion’.
Seems like the TD analysts have found a sure fire way of maintaining every bull market, forever… (it’s easy: just get sellers not to sell).
It’s remarkable that this kind of ‘analysis’ can get parroted on & on without getting called out.
Remember: Sellers aren’t competing with Buyers, they’re competing with other Sellers. How many Vancouver RE speculators (essentially each and every buyer for the last 10-15 years) are going to realize their thus-far-paper profits? We are already seeing many anecdotal examples of people who bought in 2016 or later taking losses on resales.
– vreaa

Pre-Existing Disease – COVID Economic Stress Uncovers Longstanding Vulnerability in Vancouver RE Market

Fri, 01 May 2020 18:27:49 GMT

Urban planner Andy Yan, director of the City Program at SFU, thinks the pandemic has exposed Vancouver’s economic fragility. Besides real estate, Yan explains, the economy is driven by service industries such as tourism, which has been clobbered by COVID-19. Not only do tourists help fuel short-term rentals like Airbnb, but many long-term renters work in tourism and hospitality. “If you were either counting on Airbnb or on a renter living in your secondary suite helping pay for your mortgage, and now they can’t, what do you do?” Yan asks.

Add in the fact that international travel is now very difficult, and things could get much uglier. “You have the local economy not doing well, and now you’re cut off from the global economy,” Yan says. “So it feels like it’s 1978,” when Metro Vancouver resembled what he calls Detroit by the Pacific. His summary of that era: “It wasn’t good.”

When it comes to retail and office real estate, the future looks uncertain, too, Yan reckons. It’s easy to blame Amazon, but storefront retail was already struggling before the crisis, he says. “You know how COVID takes out people with pre-existing health conditions? Well, we have pre-existing economic conditions.”

As for the office property market, Yan says that before people started staying home, 20 to 30 percent of Metro Vancouver’s labour force already worked there. “If you accelerate that and it goes into now 40 or 45, maybe even 50, how much are they going to stay at home?”

Bryan Yu, deputy chief economist with Central 1 Credit Union, also sees uncertainty ahead. “Commercial is probably a little bit problematic, especially the retail side, and even for some of the commercial product as work from home becomes much more normalized,” he says. “Will companies go back to requiring that large footprint they have now, or are they moving to a more nimble, work-from-home type of environment?”

Either way, creating a new local economy won’t be easy. Given what the pandemic has revealed about the risks of relying on global supply chains, one possible scenario is that manufacturing returns to the region. But as Yan points out, the City of Vancouver converted much of its industrial land to residential in the 1980s and ’90s. “Now where does that industrial perhaps go?” he asks. “It either goes to, say, Surrey or Abbotsford, or it goes to Calgary or Winnipeg.”

For the province as a whole, the fact that tourism, retail and other service industries dominate spells trouble in a deglobalized world, Yan warns. In food service alone, more than 120,000 B.C. workers have lost their jobs, at least temporarily, Restaurants Canada estimates. “There are these green shoots in technology or highly specialized manufacturing, but they can’t generate a mass of employment,” Yan says.

– excerpt from ‘For B.C. real estate, will COVID-19 bring down the house?’ Nick Rockel, BCBusiness, Apr 23, 2020

Apt metaphors include Biblical ‘feet of clay’ and Buffett’s “when the tide goes out you discover who has been swimming naked”.
– vreaa

COVID-19 the Pin for the Highly Debt-Leveraged Vancouver RE Bubble?

Fri, 17 Apr 2020 19:47:25 GMT

“While lockdowns, job losses and uncertainty are roiling property markets from the U.K. to Australia to Hong Kong, Canada’s situation is more precarious than most. As its oil sector shriveled in recent years, Canada’s economy became ever more driven by real estate, an industry now in a state of paralysis. Nearly one in three workers has applied for income support.
What’s more, its households are among the world’s most indebted, poorly placed to weather the storm.

“I think it is the Great Reckoning,” says Douglas Hoyes, a bankruptcy trustee in Kitchener, Ontario. “We’ve been in a period for so long where it didn’t matter what property you bought or how highly leveraged you were. Well, guess what? Now it matters.”

Since the economy began shuttering in mid-March to slow the spread of coronavirus, policy makers have raced to buttress the property market. Banks are offering mortgage holidays, including to landlords with multiple loans on investment properties.

That has raised eyebrows even within the real estate industry. “Should someone with four properties really be granted financial assistance?” asks Steve Saretsky, a Vancouver realtor. “Where exactly do we draw the line?”

The country may not have much of a choice but to prop up housing. Real estate has become Canada’s largest sector. Including residential construction, it accounted for 15% of economic output last year; energy accounted for 9%.

If it collapses, there’s not much that can pick up the slack — certainly not oil nor the seemingly unflappable consumer.

Canadians have been on a two decade spending spree since a downward shift in mortgage rates began in the 1990s. Toronto and Vancouver, the two biggest housing markets, haven’t had a major correction during that time. Housing turned into a wealth-conjuring machine. As values spiraled higher, homeowners felt richer — they spent more, borrowed more, and sent prices even higher.

That virtuous circle just popped. The City of Vancouver fears it’s heading for insolvency after it surveyed residents and found that 45% of households say they can’t pay their full mortgage next month and a quarter expect to pay less than half of their property tax bills this year.

It’s a stunning contrast to 2016, when those lucky enough to own a detached house in the west coast city watched their net worth balloon on average by more than C$1,600 ($1,130) a day without ever leaving home. In one year, the city’s properties surged in value by C$47 billion, more than double the cumulative take-home income of all its residents.

Tellingly, billboards by the consumer financial watchdog began cropping up — “Don’t use your house like an ATM” — as homeowners borrowed against those gains to fund renovations, vacations, and rental properties.

Today, Canadian households owe C$1.76 for every dollar in disposable income. In Vancouver, that spikes to more than C$2.30 — a ratio that puts the so-called supercar capital of North America on par with Iceland before the global financial crisis.

Recessions tend to be deeper and last longer when households are mired in debt — an alarming prospect for a nation that may already be experiencing its sharpest contraction on record. Canadians owe C$2.3 trillion in mortgages, credit card, and other consumer debt, about equal to the country’s GDP, which is an even higher ratio than the U.S. had before its housing bust.

“You have all of these flammable items that just need a spark, some external shock,” says Anthony Scilipoti, president of Toronto-based Veritas Investment Research Corp. “And this virus is a worst-case scenario none of us would have predicted.”

Airbnb Customers Vanish

It doesn’t take much to tip a seemingly tight market into a meltdown. If only 2% of the housing stock were to be listed for sale, it would trigger the kind of supply shock behind a 1990 crash, according to Veritas.

That’s most likely to come from investors, half of whom weren’t generating enough cash to cover the cost of owning their rental properties, Veritas found in a survey last September.

For loss-making landlords, things are about to get a lot worse: about 30% of apartment rent due April 1 went uncollected, according to estimates by CIBC Economics. That’s in line with similar estimates of U.S. rental collections.

Then there are those who invested in properties for the short-term rental market that’s all but dried up because of travel restrictions. Nearly a third of Canada’s Airbnb hosts — who jointly had 170,000 active listings in late 2019 — need the income to avoid foreclosure or eviction, Airbnb said in a letter to the Canadian government last month.

Confronting a swiftly collapsing pool of renters, more than 200 Canadian listings have exploded across Vrbo and Airbnb in recent weeks pitching themselves as isolation or quarantine havens, many offering Covid-19 discounts, according to data from Toronto-based Harmari, which analyzes online classifieds. Former Airbnb rental units have also cropped up in sales listings.

Shaky Pillars

Economists and lenders have long pointed to two pillars that have underpinned housing: a robust labor market and the biggest increase in international immigration in more than a century. Neither is holding up.

Nearly 6 million Canadians have applied for income support. Lenders had deferred nearly 600,000 mortgages, about 12% of the mortgages they hold, as of April 9. Meanwhile, immigration targets, based upon an earlier growing labor shortage, will almost certainly be scaled back.

In steps that dwarf those taken during the global financial crisis, the federal housing agency and the Bank of Canada are ready to purchase billions of dollars worth of mortgages and mortgage-backed securities to backstop the market, while lawmakers passed a historic wage bill to stem job losses.

“It’s great we have a government that says they have the fiscal firepower to do this but anyone with any math skills can calculate that my daughter’s grandchildren aren’t even going to be able to pay this off,” says Reza Sabour, a Vancouver mortgage broker. “What’s the plan after?”

– excerpted almost in toto from ‘Once Safer Than Gold, Canadian Real Estate Braces for Reckoning’, by Natalie Obiko Pearson, Bloomberg, 15 April 2020

—-

One could not have imagined that it may happen this way. The Vancouver RE market has for almost 20 years seemed to some of us to have been an ever-expanding speculative bubble on extremely precarious footing, awaiting a shock sufficient enough to deflate it. Even the 2008 financial crisis did not prove up to the task, largely (and perversely) because that crisis resulted in a bailout that we didn’t need in the form of free money. But the COVID-19 corona virus, for all its horrors and uncertainties, may finally force speculation out of this market. It has already punished Vancouver economic staples such as tourism, recreation, international education, air-bnb, construction, cruise ships, immigrants with cash… it’s hard to imagine how this body-blow could be easily overcome. As of this week there are still some voices of RE optimism regarding this being another blip from which we will inevitably recover. But it seems like the full reality of the necessary response to the pandemic is only now beginning to sink in. Its effects could take RE prices a long way back towards fundamentals determined by rental income streams and local incomes (levels far below recent sales prices). This is an outcome that a minority of us have called for and desired for a long time, but not one of us would have wanted it to come about through such an undesirable and hurtful mechanism.

Vancouver appears to have weathered the ‘first wave’ of COVID fairly well, without many citizens succumbing to the virus, and without our medical services being overwhelmed. This was very fortunate. We are now, after 4 weeks of ‘shutdown’, in the very challenging position of trying to calculate how to ‘reopen’, knowing that only a very small percentage of the population are now immune (possibly 5% or even lower). The re-emergence will have to be done carefully and in a very measured fashion. Ideally, it would require very labour intensive antibody testing, case identification, and contact tracking. We are not yet set up to do this (and an affordable quick reliable antibody test is not yet available). Germany is leading the way with reopening and we’ll doubtlessly be watching closely. Regardless, our population will be vulnerable until there is either an effective treatment, a vaccine, or ‘herd immunity’ (the last of these essentially meaning that 50-80% of the population would have had to have had the illness, with a substantial number getting very ill and a small minority [but still many thousands of citizens] dying). It is hard to imagine a way out that does not involve ongoing greatly decreased social and economic activity.
This is a daunting prospect, and we hope and trust that our city will be able to survive well, and emerge healthy at the end of it all.

We wish all readers strength and good fortune, and good health for themselves and their loved ones.
Stay safe and well; stay sane.
Find productive, nurturing things to do within the lockdown restrictions.
Keep in touch with family, friends and other fellow citizens.
This will pass, but be ready for it to take some time. Likely many months.

– vreaa

Vancouver Sun Headline – ‘Five more Metro Vancouver homeowners hosed in a falling market’

Fri, 06 Dec 2019 21:50:54 GMT

“A recent report from Central 1 Credit Union suggests a rebound in Metro Vancouver’s housing market is coming. However, at the moment there are property owners losing hundreds-of-thousands of dollars on their investments.”
There follow examples of homeowners losing money, care of @mortimer_1:
1. Burnaby. Bought $1.9M May 2016, Sold 2019 $1.495M, Loss $405K + expenses (over 21%)
2. Burnaby. Bought $3.11M 2016, Sold $2.1M 2019, Loss $1.01M + expenses (over 32.5%)
3. Vancouver Westside. Bought $2.7M Feb 2016, Sold $2M 2019, Loss $700K + expenses (over 25.9%)
4. North Vancouver. Bought $2.36M Mar 2017, Sold $2.05 2019, Loss $310K + expenses (over 13.1%)
– from David Carrigg, Vancouver Sun, 5 Dec 2019 (image: Anselm Kiefer)

Seeing terms like “homeowners hosed” and “falling market” in top-of-the-page Vancouver Sun headlines is certainly worthy of note – particularly for those of us who have been following this long enough to have endured years and years of local media entranced with rising prices. (Anybody remember the well-known local TV anchor exclaiming “I love Real Estate!” ?)
However, note that the Sun still talks about homes as “investments” – perhaps that will have to change before we’re done.
Here and elsewhere, some discussion of ‘soft landings’ that is clearly based more on hope than observation.
As noted previously, our target prices should be determined by utility value of properties, not on imagined future sale prices. Current prices are still far above those levels.
It ain’t over.
– vreaa

Vancouver RE Prices – Where is the Support?

Fri, 26 Jul 2019 22:14:26 GMT

REBGV headline detached averages have dropped from peak $1850 K to current $1486 K, about 17%.
Sleuths such as @VanREflipflops have revealed many examples of substantially higher drops.
At what price levels will support come in? and from where? and when?…
All of this currently speculative (cough, cough).
Using the price chart and other past markets as a guide, REBGV headline detached prices (real, adjusted for inflation) could drop back to support determined by prices seen in 2013 (-45% from peak), 2009 (-60%), or even 2003 (-78%).
This will still seem incredible to most, but it is the lesson from comparable speculative manias.
Are locals going to be lining up to overextend themselves into RE anytime soon? If not, prices still have a long way to drop.
– vreaa

Money Laundering & Vancouver Home Prices

Fri, 10 May 2019 16:32:17 GMT

“The cost of buying a home in B.C. increased by as much as five per cent last year due to more than $5 billion in dirty money from organized crime laundered through the province’s real estate sector, according to a new expert panel report.

Former deputy attorney general Maureen Maloney chaired the panel on money laundering, which released a report Thursday that concluded it “cautiously estimates that almost five per cent of the value of real estate transactions in the province result from money laundering investment.”

In addition, she concluded: “The estimated impact of that would be to increase housing prices by about five per cent.”

“Successfully reducing money laundering investment in B.C. real estate should have modest but observable impact on housing affordability,” read the Maloney report.”

– excerpt and image from ‘$5 billion laundered through B.C. real estate, inflating home prices: report’, Rob Shaw & Joanne Lee-Young, 9 May 2019

An extra 5% price rise last year? Gee, that’d be the difference between supernatural 7% a year housing price increases that have characterized our bubble, and… inflation (about 2%). [But we don’t think this means we can conclude that this has been a long term effect. It may have been, but we can’t be sure].
As readers of this blog know, we’ve long thought that the primary driver of the bubble has been local buyers prepared to extend debt to the gills to get in, and that those buyers have been particularly besotted by the ‘Chinese-are-coming’ story.
There has, of course, been a direct effect of foreign-buyer-demand, but this pales when compared to local speculation.
Money-laundering juice certainly could have contributed, both directly, and perhaps more importantly indirectly by further cementing the foreign-demand story.
Interesting to think that it may have been a critically important amount.
With a coming clampdown (or even threat of a clampdown) it’ll be interesting to see the effects this has on prices going forward.
Speculators (foreign and local) hate falling markets, and floor prices determined by fundamentals are far below.
– vreaa

5 Secrets to Packing A Cluttered House

Mon, 29 Apr 2019 15:26:23 -0400

It seems that when it comes time to move, there seems to be “stuff” everywhere cluttering things up and making you feel like you’ve been hoarding things for years. When this happens, your motivation to pack usually heads straight south and you stop having any enthusiasm for the task at hand. So how do you get rid of all the clutter and get it packed effectively? Here are tips that can help

1.Clean house

Before you even begin packing, you need to go through each room and create three separate sections for items: Pack, Donate, and Trash. The first goal when preparing for a move is to get rid of as much unnecessary stuff as you can so that you don’t have to pack it.

2. Use your stuff to your advantage

Do you have a lot of dresser drawers that are packed? Good, don’t empty them. Use your drawers as improvised packing boxes instead of taking things out, put them in a box, and then unpack them in your new home.

3. Free packing material

Don’t feel like you have to buy rolls of bubble wrap to protect your things. Heavy winter clothes and old sheets and comforters make great packing material for fragile items. You are going to have to pack them anyway, so you might as well use them to lighten your packing load.

4. Think small

Don’t feel like you have to pack everything into a half dozen giant boxes. Multiple smaller boxes work just as well and they are also lighter when it comes time to carry them.

5. Labels are your friend

If you’ve got a lot of stuff, then you know it will be ridiculously hard to find when it comes time to unpack. Label all of your boxes, not just with the location, but also with a box number. Then use an online app such as Sortly (https://itunes.apple.com/us/app/sortly-moving-organizing-inventory/id529353551?mt=8) to keep track of what you put in each box by the organizing number.

The post 5 Secrets to Packing A Cluttered House appeared first on Crescent Moving & Storage.

What every pet owner needs to know about moving

Mon, 15 Apr 2019 17:13:06 -0400

We all like to think of our pets as part of the family, even like our own children. And just like kids, pets get anxious and stressed out when it comes to leaving home and moving into a new place.

That’s why it’s so important to take special care of your pets so they don’t get harmed or upset during a move. Here are some things that every pet owner needs to know about making a move with their precious pet

1) Pack on overnight kit along with your own

Everyone is told to pack an overnight kit of essentials like toiletries and clothes when they’re moving. The same holds true for pets. Pack a special bag with their food, litter, and toys that will help keep them calm and relaxed when you arrive and have to unpack.

2) Put them in a kennel or with a friend

When you’re actually moving, you want to reduce the amount of stress on your pet. Do this by keeping them out of the way of the movers. Send them to a kennel for the day or have a friend watch them. This will be a lot less traumatic than having them underfoot or slipping outside during the move. When you actually take them to the new home, be sure to do so in your own car so you can make them feel comfortable.

3) Be wary of certain species or breeds

Certain animals are more susceptible to trauma during a move because they don’t deal well with change. If you have a bird, fish, a guinea pig, or a bunny, then you should spend extra time and care with transporting them so they’re not injured.

4) Take your pet’s records with you

This one is so you can have a continuous standard of care with your pet. Make sure to get all of your animals shot records and other information. It’s also a good idea if you can do some research and find a good vet in your new location before you move. Also, if your animal has tags or a microchip, be sure to get these updated with your new address and information.

5) Slowly Introduce Your Pet to Its New Home

As much as possible, get your human belongings set up in the house before your pet moves in. (Even if it’s just one room!) Once your pet arrives confine him / her to that section in order to adjust to the new surroundings. Give your fur baby lots of attention and love during this time, and introduce them to familiar objects like toys or blankets as soon as possible to keep the transition smooth. Give your pet some time to get adjusted – soon they will feel just as at home as you do

The post What every pet owner needs to know about moving appeared first on Crescent Moving & Storage.

“Psychologically, They’re Ill-Prepared” – “Canadian Chaos Looms”

Fri, 12 Apr 2019 16:45:56 GMT

While Canadian bank advocates and their skeptics exchange words, the formerly-white hot housing market is now in deep freeze. March sales in Vancouver collapsed by 31.4% year-over-year according to the local real estate board, the worst showing since 1986 and down 46% from the 10-year average for March. Prices also lurched lower, with the benchmark detached home price falling 10.5% year-over-year to C$1.44 million ($1.08 million). Things are more stable in Toronto, where March sales and benchmark prices were little changed from a year earlier, but those figures remain 40% and 14% below their respective levels from March 2017.

As the housing market sputters, the highly-leveraged Canadian consumer displays increasing signs of distress. According to the Bank for International Settlements, Canada’s household debt stands at 100.2% of GDP as of the end of September, by far the highest ratio among G7 economies (the U.K. is next at 86.5%), while the debt service ratio, or the percentage of disposable income allocated to principal and interest payments, rose to 14.9% in the fourth quarter per Statistics Canada, just shy of the 2007 peak.

That debt burden is starting to weigh on consumers. Auto loan delinquencies rose to 0.97% at year-end according to Equifax, Inc., the highest since 2009. At the same time, 36% of new auto loans in the fourth quarter were leases, the largest such share since 2007. Bill Johnston, vice president of data and analytics at Equifax Canada Co., noted that “we’re starting to see consumer behavior shift to keep the payments as low as possible.”

– excerpt from ‘”Psychologically, They’re Ill-Prepared” – Canadian Chaos Looms’, from Grant’s Interest Rate Observer, via Zero Hedge, 11 Apr 2019

A Parent’s Guide to Helping Your Child On Moving Day

Thu, 04 Apr 2019 16:58:18 -0400

Imagine this for a moment: You’re five years old and men you’ve never seen before come to your house and take away all of your belongings. Sounds like the stuff of nightmares, right? Well, many adults take moving day for granted as just something that has to be done, but for little children it can be disorienting and scary. That’s why it is important for parents to consider their young ones when it comes to planning a move. Here are 5 Essential things every parent should do before moving day.

Talk to your kids first.
Communication is always going to be key when dealing with children. Talk to your children early on about the move. Get them excited about it. Explain to them how everything will go and also emphasize this is not something to be worried or upset by. These types of reassurances will go a long way in soothing your child

Visit the new home
Another way to ease them in is to visit the new home with them. Get them interested in the house and thinking about how they can decorate their room. Also, show them around the neighborhood so they can see things that they might like to do once they move in.

Get the kids involved
If your child is actively involved in the move, then it won’t seem as scary to them. Have your child help pack up their room. If they’re too young to pack, have them decorate the boxes with their own artwork so that it looks more “fun.”

Get a babysitter
If you have young children, all of your preparation may still go out the door when they see the moving men on the day of the move. That’s why it’s a good idea to get a babysitter that day so they won’t be around to see all their stuff being taken off. Also, this is a great idea so you don’t have to worry about them getting in the way or getting hurt.

Pack a special bag
Finally, be sure to set aside a special bag for your child. This should have some of their favorite clothes, PJs, toiletries, and also their favorite toy (or toys). Be sure to pack a special stuffed animal to help them as a security blanket. This bag will help may the first night in the new home go smoothly.

And remember – kids pick up cues from mom and dad. If you are stressed out – your kids are going to be stressed out too. Keep your moving day as stress free as possible by hiring professional movers.

The post A Parent’s Guide to Helping Your Child On Moving Day appeared first on Crescent Moving & Storage.

Keeping Up With Other Bubbles – Australia Suddenly Not Running Out Of Land Anymore – “Aussie House Prices Could Halve”

Fri, 22 Feb 2019 22:12:18 GMT

It was supposed to be different there, too

House prices in Sydney and Melbourne could fall by up to 25 per cent this year alone and “there’s a chance they could fall by half” in the coming “property bloodbath”, an economist has warned.
LF Economics founder Lindsay David, who has been warning of the looming property crash for the past five years, said in a report today the recent house price falls were just the beginning.
CoreLogic data for January showed Sydney and Melbourne prices were now 12.3 per cent and 8.7 per cent down from their respective peaks in July and November 2017, with Melbourne falling at “the fastest rate ever seen”.
“We think there’s a chance property prices could fall by half in Sydney and Melbourne over the long run,” David said.
“I wouldn’t be surprised by falls of at least 40 per cent. When all hell breaks loose you’ve only got so many buyers out there.”

His base case of 20 per cent falls in calendar 2019 is significantly more bearish than other experts. AMP Capital is tipping total peak-to-trough falls of 25 per cent in Sydney and Melbourne, while UBS is tipping 25 per cent with a “rising risk of 30 per cent”.
David bases his forecasts largely on the “debt accelerator”, which is strongly correlated with house price growth six months forward. Latest data indicates the debt accelerator is “falling sharply” in Sydney and Melbourne.
If that happens, Sydney and Melbourne “will suffer peak-to-trough falls never experienced before, outside of the 1890s depression and real estate collapse”.

– excerpt and image from ‘Property bloodbath’: Aussie house prices ‘could halve’, Frank Chung, news.com by way of New Zealand Herald, 20 Feb 2019

Watershed? or Dam-Collapsing? – Mainstream Media Quoting Vancouver RE Bear-Tweets, and Predicting Shrinking Realtor Numbers – “What they’re used to is not what real estate is typically like.”

Fri, 08 Feb 2019 20:16:02 GMT

“Warning: Some viewers may find the following footage distressing…”

“There’s a cottage industry emerging on Twitter, with various accounts and followers seeming to take delight in the financial woes besetting Metro Vancouver homeowners hoping to sell their homes, or selling their homes at crushing losses. … Here’s a look at five examples highlighted on Twitter of homes in Vancouver and West Vancouver where the owners took a bath, or are at least one foot away from a nasty fiscal scolding…”
– from ‘Five examples of Metro Vancouver homeowners losing big in a plunging market’, David Carrigg, Vancouver Sun, 7 Feb 2019

Now you notice? -ed.

“The softening housing market could lead to tough times for some realtors, especially those who have recently entered the profession, said the president of the Fraser Valley real estate board. “I think it’s going to be tougher for the more-inexperienced realtors, those who are three or four years in,” said John Barbisan. “What they’re used to is not what real estate is typically like.” The 35-year veteran said agents will be forced to be more like “consultants than auctioneers” as they help to connect buyers and sellers. …
According to the council, there were 25,987 licensed real estate professionals in B.C. as of Dec. 31 — a 36-person drop from Sept. 30, although still slightly higher than June 30. The dramatic increase in the number of licensees — from about 21,000 in 2012 to 26,000 in 2018 — seems to be slowing.”
– from ‘Sales slump could signal tough times ahead for B.C. realtors’, Glenda Luymes, Vancouver Sun, 8 Feb 2019

We can recall when BC Realtors crossed the 10,000 mark. Seems a fair bet we’ll go back below that number once all is shaken out. -ed.

“Within artistic communities in Vancouver it’s hard to spend more than 15 minutes at a social gathering without talking about the cost of rent or knowing of someone who is being evicted.”

Fri, 01 Feb 2019 20:16:09 GMT

Ian Wallace, Construction Site (Olympic Village) III, 2011. Photolaminate and acrylic on canvas, 183 x 244 cm.

“When you’re in Vancouver, within artistic communities, it’s hard to spend more than 15 minutes at a social gathering without talking about the cost of rent or knowing of someone who is being evicted,” says Am Johal, director of community engagement at Simon Fraser University’s Vancity Office of Community Engagement.

In my day-to-day in Vancouver, I find myself preoccupied with constant reminders of my own impermanence. Exiting my beloved Mount Pleasant rental apartment, I’m hit by a thud of anxiety each time I see a development notice erected in my neighbourhood. I pass by so many of my once-favourite galleries (and former places of employment), now repurposed or left empty. Friends and artists leave. Those of us who remain spend most of our time defending the choice to stay. Our defence often sounds optimistic, perhaps naive: staying here and making art is important, too.

In this five-part series, I intend to think through how the housing crisis is having an impact not only on the production of art in Vancouver, but also on art’s responsive and changing communities. Issues of unaffordability, including high rent and inaccessible housing, go beyond dwindling supplies of accessible gallery, home, institutional and studio spaces. Complicating these issues is that artists and art centres are often themselves gentrifying elements within a city, a phenomenon already long-acknowledged and in-process in Vancouver. If we know well by now that unaffordability generates and exacerbates inequality generally, it feels necessary to emphasize that it also generates and exacerbates inequality, and tension, including class stratification, within artistic communities, too. It can be a contradictory conversation or, at least, a circular one. But if we acknowledge the role of the arts in gentrification, we should be looking deeper at what this disparity of opportunity in culture comprises. If the art community is asked to navigate, evade or compromise an ever-tightening commercial grip, we should really be talking about who in that community is benefiting, and suffering, most from unaffordability.

– image and excerpt from Who Has the Right to Art?, Alison Sinkewicz, Canadian Art, 31 Jan 2019.

Macleans Wakes Up – ‘This is how Canada’s housing correction begins’ – “We’re not ready for what happens next”

Fri, 11 Jan 2019 19:14:29 GMT

Kirk Marsh first noticed the mood start to turn in Vancouver’s housing market a year ago. As a real estate investor who buys homes and condos then fixes them up for resale, Marsh has an excellent vantage point on the market. Since giving up his old job in tech three years ago to flip real estate—“Sitting at a desk was killing me,” he says—Marsh has bought and sold six detached homes and condominiums across the B.C. Lower Mainland. “It’s not like TV shows where you see them making $100,000 or more each time, it’s just not like that,” he says. But he’s done well, always able to find buyers and come out ahead.

Or that’s how it used to be. “Today, everything has stalled,” he says.

While visiting open houses over the past year looking for his next flip, Marsh watched the frothing crowds and bidding wars steadily dwindle away. “There’s just nobody showing up at the open houses now,” he says. “Especially downtown. Usually you’d see a group of very aggressive people coming out.” But he’s also keenly aware of the slowdown because he’s trying to unload a renovated two-bedroom condo in New Westminster, just east of Vancouver. The unit, with an asking price of $569,000, had been sitting on the market for two months as of mid-December, with almost no interest.

– excerpt and image from ‘This is how Canada’s housing correction begins’ by Jason Kirby, Maclean’s, 3 Jan 2019

The whole article is worth the read, and nails many things…
Pretty much what we’ve been warning of on these pages for …oooh… more than a decade.
You can only tell who’s been swimming naked when the tide goes out (and that includes entire countries).
Regarding Kirk, starting flipping three years ago was extremely late to the Lower Mainland party and he should count himself very fortunate if he gets out alive.
– vreaa

Vancouver Detached – Sales Down, Prices Down

Fri, 07 Dec 2018 18:57:55 GMT

“Sales volumes are incredibly weak with buyers looking for steep discounts and many sellers still unrealistic with their asking prices. However, sellers who need to sell for whatever reason are increasingly having to lower their prices. There is often a rhetoric that “sellers simply won’t sell” if they don’t get their price, and while this may be true the reality is there are still sellers who absolutely need to move on, such as estate sales, divorces or job relocation. These sellers are ultimately setting the benchmark lower.”
– charts and quote from Realtor Steve Saretsky

Classic dynamic for a declining market.
Will crucial technical price supports hold?
Will buyers “rush in” to “snap up ‘bargains'” ??
Fundamental supports are f-a-r below. -ed.

Bloomberg Calls Vancouver ‘The City That Had Too Much Money’

Sun, 21 Oct 2018 22:50:50 GMT

Known abroad primarily for its stunning Pacific Coast setting and athletic lifestyle, the city has since become one of the world’s largest sluices for questionable funds moving from Asia into Western economies. One academic terms the process “the Vancouver model”: a seamy mingling of clean and dirty cash in casinos, real estate, and luxury goods made possible by historic ties to China and by Canada’s lax record of fighting financial crime.

It’s a product of one of the largest financial flows of the 21st century: The money being frenetically shuffled by millions of wealthy Chinese into safe assets abroad, in defiance of their country’s capital controls. Since mid-2014, capital flight from China may have totaled as much as $800 billion, according to estimates from the Institute of International Finance.

In Vancouver, the tidal wave has wrought a dramatic economic, demographic, and physical transformation. Alberni Street, a formerly dowdy downtown thoroughfare, has in the past decade welcomed a two-level Prada boutique with a black marble facade, one of the largest Rolex showrooms in North America, and a 62-story tower with a five-star Shangri-La hotel. All have Mandarin-speaking staff. In May, Rolls-Royce chose Vancouver to unveil its first sport utility vehicle, which starts at more than $300,000, hosting a Champagne reception at its sleek new local dealership in an upmarket neighborhood about two miles south of Alberni. Six sold on the first day—bound, perhaps, for the “car condo,” a kind of luxe garage with customizable suites that’s being built in a majority-Asian suburb. The units start at more than C$800,000, and the first batch recently sold out.

Much of the money coming in has been legitimately earned, if sometimes extricated by gray-market means. But officials say that a substantial proportion is the proceeds of corruption or crime, including the illegal sale of opiates such as fentanyl. With public anger rising over astronomical housing prices and an economy distorted by wealthy outsiders, British Columbia’s left-leaning government—elected last year on a platform focused on calming the real estate market—is building a global laboratory for policies meant to restrain the arrival of Chinese money. The province is hiking taxes, toughening transparency rules, and tightening oversight of casinos and financial institutions.

Change will be difficult and fraught. Vancouver has been closely connected to Asia since the late 19th century, when the first Chinese laborers arrived to help build the trans-Canada railway, and the city is proud of its record of integrating immigrants. Also, beyond real estate, Vancouver’s economic base is shallow. It’s not the business capital of western Canada—that’s Calgary—and it has few major corporate headquarters or large-scale manufacturing operations. “Asian capital has kept this economy alive, end of story,” says Ron Shon, a Chinese-Canadian venture capitalist who arrived as a teenager in the late 1960s. “You can see it in every aspect of our lives.”

The money is arriving so fast, and in such volume, though, that standing by is no longer an option. Vancouver was perhaps the first major Western city to experience the full force of Chinese capital. Soon, it could be the first to learn what happens when you try to stop it.

– excerpt and image from ‘The City That Had Too Much Money’, Matthew Campbell & Natalie Obiko Pearson, Bloomberg, 20 Oct 2018

“Our family loves Vancouver, but we’re leaving because the struggle to live here is simply too hard”

Fri, 28 Sep 2018 17:30:43 GMT

Lee Abrahams and her two daughters in the living area of her tiny suite. [image: Vancouver Sun]

“In the Fraser Valley, about an hour and a half or so from Vancouver, my husband and I live in a tiny home. We occupy 400 square feet with two young children and three pets, and pay a low rent to our family for occupying their property. My husband commutes more than two hours to work, each way, five days a week. He is in a company that treats him wonderfully, but his income is low, as is the same for just about everyone trying to get by in Vancouver and its surrounding areas.

I am a writer and cannot work full time out of the home because the cost of daycare far outweighs anything I could earn despite my extensive resume. I hail from New York City and when people ask me how on earth I was able to afford living in Manhattan, it’s hard not to laugh.

“Easier than I can afford living here,” I tell them. That usually elicits quiet shock. It leaves me speechless, too.

I came here five years ago from my loud and proud city to study at Simon Fraser University. At the time, housing had yet to become the full crisis it is today. I didn’t intend to stay long term, but it seemed like a good place to start over as a single mother. I went to school full time, worked two jobs and had a childcare arrangement with a lovely family that I was able to afford.

That time was a blur. I barely saw my daughter, and I assured myself that it was all for a good cause. I made decent money, was working toward my degree, and not too long after I met my now-husband. I stayed because I worked hard to be here and just as we were considering a house, things went wildly out of control.

We were priced out of the market. My husband’s parents were looking for a house, and it was not uncommon for them to be outbid by well over $100,000 of the asking price. Nine exhausting months later, and through word of mouth, they found a seller with enough property for us to share. My husband and I have been stuck in a weird in-between since finding this property with his parents.

We range from having a great savings nest, to having it completely drained once tragedy or car repairs are needed. Or my husband gets sick and loses hundreds of dollars just from getting the flu. Thus begins the tumultuous climb to paying down the credit cards we needed to rely on, paying double bills from the month we fell behind, and then — four months later — finally having savings again. Rinse and repeat.

Despite the market slowing down, prices are still significantly higher than incomes can afford. In Maple Ridge, the cheapest area of Metro Vancouver, incomes still have to be at least $121,780 a year to afford a house. And housing and low incomes aren’t the only challenges we and others face. We are incredibly fortunate to live with a low cost of housing, but it comes at great sacrifice.”

– excerpts and image from ‘Our family loves Vancouver, but we’re leaving because the struggle to live here is simply too hard’, Lee Abrahams, Vancouver Sun, 22 Sep, 2018

Tendency Towards Corruption Is Inevitable – How Do We Minimize Its Existence?

Fri, 14 Sep 2018 18:24:31 GMT

cartoon by Cheney

Hard Earned Home Savings? Hardly.

Fri, 08 Jun 2018 20:31:49 GMT

– image care of long-time reader and very occasional contributor ‘westsidefrank’

A tip for home-owners contesting proposed new taxes: Make almost any argument you want, but do not claim that any profits that you have accrued by virtue of owning Vancouver RE are ‘Hard Earned’. This insults people who work hard, and at the same time insults anybody with a modicum of intelligence. Hundreds of thousands, sometimes millions, tax free? As Bing Thom the architect once said “I have done pretty well in my business, but I made more money from sitting on my Vancouver property than I made by working an entire lifetime. That tells you something.”
[BTW, it looks like somebody has graffitied onto that sign, under the “Angry?” question, something along the lines of: “Yeah, because I can’t afford to live in a mansion like you!”]
– vreaa

“You know your real estate is in bad shape when there is a game app that displays Vancouver’s Science World and teaches you how to be a money hungry real estate developer.”

Sun, 20 May 2018 22:47:47 GMT

“You know your real estate is in bad shape when there is a game app that displays Science World and teaches you how to be a money hungry real estate developer: #vanRe #vanpoli”
– tweet from Brette A. Mullins @BretteMullins 3:27 PM – 18 May 2018

“It’s sinking in that Vancouver is sinking” – “Westside prices have fallen 17% from 2016 & 11% this year; sales volumes down by 80%; 3 years worth of >$3 Million inventory”

Sat, 05 May 2018 22:42:34 GMT

First, a Toronto Story: “The home sold for 25 per cent less than what John had paid just five months earlier, a loss of $500,000”
“The house in Toronto was the type of property highly coveted by those in the city: fully detached on a sprawling lot, recently renovated and adorned with granite countertops, hardwood floors and a solarium. John, who asked that his name not be used for reasons that will become obvious, knew he had to make an offer. He figured he could rent it out, and if the payments didn’t cover the mortgage costs, no matter. Back in early 2017, home prices in Toronto were on an unstoppable tear, surging double-digits every month. The house would surely be worth more in no time. The home was on the market for only a few days when John’s offer was accepted. He bid nearly $1.9 million, about $360,000 more than the list price. Then everything fell apart.
John, a real estate agent, thought he had financing lined up. But the bank declined to lend him the money. John had recently formed his own brokerage, and the bank was treating self-employed individuals with far more caution in an overheated market. He consulted two lawyers, who told him that if he walked away from the deal, he could be sued. John decided he had no choice but to take a mortgage from a private lender that carried a hefty 12 per cent interest rate. He knew there was no way he could afford the payments and listed the property as soon as he took ownership.
But there was another problem. During the closing period, the Ontario government introduced the Fair Housing Plan, which included a 15 per cent tax on non-resident buyers. The plan released the air from the housing market, and prices took a nosedive. John’s investment property sat on the market for 27 agonizing days before a buyer could be found. The home sold for 25 per cent less than what John had paid just five months earlier, leading to hundreds of thousands of dollars in losses [ballpark $500,000 -ed.]. “I was so greedy,” he says now. “I will not play the game like that again.” Painful as it was, he looks back at the debacle as a learning experience. He even purchased some books about real estate investment on Amazon to learn how to do it properly.
John’s tale of misfortune isn’t exactly unique. Hundreds of Greater Toronto Area residents were caught when the housing market took an abrupt dive last year after a long run of booming activity. Home sales plummeted 32 per cent from the peak, and prices cratered by 10 to more than 30 per cent in the suburbs, depending on the municipality.”
– image and excerpt from ‘The people who bought at the peak of Toronto’s real estate bubble, and then lost hundreds of thousands within months’, Joe Castaldo, Maclean’s, 4 May 2018 [hat-tip El Ninja]

Second, some Vancouver market facts from Garth Turner: “On the Westside prices have fallen 17% from 2016 and 11% this year while sales volumes have evaporated 80%”
“Detached home sales are crashing hard. What everyone wanted two years ago sits idle and unloved. Transactions are down by a third to the lowest level ever for an April.
In West Van sales are off by half. Incredible. Only 30-odd deals. Another spring record. Sales in Richmond have been sliced almost 60%.
Over six thousand listings materialized across the province in a single day. The meme is spreading. This ship’s going down.
Overall, sales are reduced an astonishing 62% from 2016. The lowest number in 30 years.
The average sale price has declined 6% from last year, 8% from 2017 – and this is just the start.
Two Aprils ago $3.5 billion was spent on housing in Vancouver. This April that fell to $1.35 billion. That’s $2 billion less spent in a single month. If you think there will not be economic implications, you’re wrong.
On the Westside prices have fallen 17% from 2016 and 11% this year while sales volumes have evaporated 80%. There is three years’ worth of inventory for houses valued at $3 million or more – the ones the NDP has targeted for a special punitive tax.
Over 90% of the houses now selling are going for less than asking. Two years ago, almost all were over ask. In April there were as many price reductions on detached houses as there were sales. Yes, it’s sinking in, that Van is sinking.”
– excerpt from ‘The big shed’, Garth Turner, 2 May 2018 [hat-tip El Ninja]

If a serious market correction were to commence, this is pretty much what it would look like. The beginning of a lengthy, drawn out correction process… Watch as wave after wave of ‘Johns’ sell at lower and lower prices. It’ll take years to play out.
Ultimate target: The return of Vancouver RE prices to those determined by the utility of property in our economy.
– vreaa

The Carrion Have The Carcass – “I’ve lived in Vancouver since 1968; my wife was born here; we are about to leave; this town has priced us out. All that is left are the investors and the very rich visitors.”

Mon, 23 Apr 2018 06:19:38 GMT

“I have lived in Vancouver since 1968 and my wife was born here, as was her mother, and now we are about to leave because this town, and I call it a town, because it not a real city, has priced us out. The things that made Vancouver great have been hollowed out, sold off or torn away and unfortunately all that is left are the investors and the very rich visitors. The carrion have the carcass.”
– Johnny Lee, at VREAA, 22 April 2018 [image from The Vancouver Sun]

All Time High, And Climbing… $251 Billion Personal Debt Borrowed Against Canadian Homes

Sun, 22 Apr 2018 20:04:05 GMT

Canadian real estate related debt tapering? That would be ridiculous! Filings obtained from the Office of the Superintendent of Financial Institutions (OSFI) show, after a brief decline in January, the balance of loans secured by residential real estate hit a new high in February. More interesting is the segment of loans being used for personal consumption, is growing at the fastest pace in years…
Loans secured by real estate hit a new all-time high in February. The total balance of loans secured with real estate racked up to $283.65 billion, up 0.77% from the month before. This represents a 7.79% increase compared to the same month last year. It almost looked like Canadians were reeling that debt in January, with a tiny decline. Instead it made a monster move, more than making up the ground lost the month before…
The total of loans secured with residential real estate for non-business purposes spiked in February. The outstanding balance reached $251.64 billion, a 0.77% increase from the month before. This represented a 6.83% climb compared to the same month last year. This brings the total to an all-time high. … The annual rate of 6.83% is the fastest rate of growth since… well, since banks started reporting these numbers on their balance sheets. Apparently higher rates aren’t slowing borrowers down.
– chart and text from ‘Congrats! Canadians Just Set A New Record For Borrowing Against Their Homes’, Daniel Wong, Better Dwelling, 18 April 2018

When Canadian RE goes down, it will have weights around its ankles. -ed.

“I asked a group of young people how many of them thought they’d be in Vancouver in two years, and 17 out of 18 said that they would be moving.” – Mayoral Candidate Shauna Sylvester

Sat, 07 Apr 2018 17:46:56 GMT

“I was in a session the other day with a group of young people, and I asked them how many of them thought they’d be in Vancouver in two years, and 17 out of 18 said that they would be moving. They were tired of being evicted, they couldn’t find affordable housing. My daughter, Rowan, who is 23, can’t live in Vancouver because she can’t find an affordable rental.” [Goes on to discuss her ideas about housing policy]
– Shauna Sylvester, Independent candidate for Mayor of Vancouver, from interview posted on youtube, Vancouver Sun, 5 Apr 2018

Off-The-Charts Unaffordable – Greater Vancouver Price-To-Income Ratio 28 (average home price: $1,071,800, median one-person income: $38,164)

Mon, 02 Apr 2018 15:27:45 GMT

A recent report from Zoocasa shows that even the least expensive cities in the country can require a major financial commitment for solo buyers. Experts say individuals shouldn’t be spending more than three times their annual income on a home. But according to Zoocasa’s report, the average buyer would have little choice but to break that rule.

“Overall, even in the least housing expensive markets, home ownership is a significant expense for single people in Canada,” Zoocasa CEO Lauren Haw said. “Our report found that a single homebuyer would need to spend a minimum of four times their annual income to be able to afford a home on in their own.”

“Though we expected to see Vancouver and Toronto up at the top of the most unaffordable regions list, we were surprised to see just how high the price-to-income ratio was in these cities,” said Haw. “This demonstrates that home ownership in Canada’s major urban areas on a single income would be very difficult, if not impossible by measures of affordability.”

– BNN, 30 Mar 2018

Keep in mind that a ratio of 5 (yes, five) is historically seen as ‘severely unaffordable’. – ed.

Conflicts of Interest – BC MLAs Heavily Invested In RE Making Laws About RE

Thu, 15 Mar 2018 06:38:58 GMT

Premier John Horgan and Finance Minister Carole James say the government is still working out the details of a new speculation tax on B.C. properties.

It’s a discussion their colleagues in the legislature will be keenly interested in, as many of them own two or more homes in the province.

Horgan said the government has delivered on its promise to put in place a speculation tax. But the announcement has sparked concern from owners of vacation homes who fear a hefty tax bill.

“We haven’t laid out the details,” Horgan said. “Now we’re making sure the minister of finance, with the assistance of British Columbians, will be able to fine tune that so we realize the objectives of the tax and also go forward in a way that makes sense to people.”

The February budget included a speculation tax that will be effective for the 2018 tax year. The government said the tax would initially apply in Metro Vancouver, the Fraser Valley, the Capital and Nanaimo Regional Districts, and the municipalities of Kelowna and West Kelowna.

The tax was to target properties owned by people who don’t pay income tax in the province. It will be $5 per $1,000 of assessed value this year and in 2019 will rise to $20 per $1,000 assessed value.

That means that someone with a $1-million property covered by the tax would be looking at a $5,000 tax bill for 2018 and $20,000 in 2019.

“This tax will target foreign and domestic speculators who own residential property in B.C., but don’t pay taxes here, including those who leave their units sitting vacant,” materials released with the budget said.

—-

The tax is a bold measure, [Carole James] said. “We want to get speculation out of the market. We know it’s a problem in our housing market. We know we have to address it. We know British Columbians expect us to address it. It was ignored by the previous government. We’re acting on it.”

That action could affect dozens of the province’s 87 MLAs and their families based on their public financial disclosure statements. The statements also give a window into how complicated many people’s real estate dealings are.

Horgan, for example, has a one-third interest in an investment property in Victoria. As long as it’s rented for the long-term he’ll be exempt from the speculation tax, but not if it’s sitting empty.

James owns not just the home she lives in, but she is also the joint owner with a family member of a second home in Victoria. Presumably that home is her relative’s principal residence, which would make it exempt.

But what about out-of-town MLAs who use the allowances — from $12,000 to $19,000 a year — provided for housing in the capital to help buy second homes? On the NDP side they include Bruce Ralston, Selina Robinson, Ravi Kahlon and Rachna Singh.

Shane Simpson and Scott Fraser each disclose owning a half share in a Victoria home and principal residences elsewhere. Fraser also owns an investment property in Parksville. Leonard Krog has an investment property in Victoria and a recreational property at Black Creek.

Claire Trevena owns a second home in Victoria and an investment property on Quadra Island. Spencer Chandra Herbert owns a second home in Victoria, but also has an investment property in Vancouver and a 50-per-cent interest in a recreational property in West Vancouver.

Michelle Mungall owns a second home in Victoria, two investment properties in Nelson and a third in Castlegar. All three investment properties are outside the regions where the new tax is to apply.

David Eby, by the way, owns a home in Victoria, but not in Vancouver where the constituency he represents is.

On the Liberal side, MLAs owning a second home in Victoria include Marvin Hunt, John Yap, Mike Bernier, Ralph Sultan and Jordan Sturdy.

“There’s no consideration around ‘special’ for one group or another,” James said when asked how the new tax may affect MLAs with second homes in Victoria. “We’re going to look at all of the questions and issues that have come forward and we’re going to make the decisions and bring the implementation forward.”

Among the Greens, Andrew Weaver owns a recreational property in Parksville and two investment properties in Victoria. Sonia Furstenau’s spouse has an investment property in Victoria.

Several MLAs also have recreational properties. Cabinet minister Judy Darcy has a recreational property on Mayne Island, which is included in the areas where the tax will apply. NDP MLA Janet Routledge owns a recreational property on Mayne Island and a timeshare in Whistler.

Peter Milobar shares with family members a cabin on Shuswap Lake. Greg Kyllo and spouse have a 50-per-cent interest in a recreational property at Silver Star in Vernon.

Others hold investment properties that are likely rented out. Bob D’Eith’s spouse has an investment property in Langley. Raj Chouhan’s spouse has a one-third interest in a Burnaby property. Teresa Wat owns an investment condo in Vancouver. Norm Letnick’s spouse has an investment property in Kelowna. Mike de Jong has an ownership interest in half a dozen investment properties in Abbotsford.

And then there are the oddities, situations where it’s unclear what would count as a principal residence and what wouldn’t. Michael Lee lists ownership as a trustee for a family member on a house in Vancouver (other than his residence), as does his spouse. His spouse also has a one-seventeenth interest in agricultural property in Langley.

Anne Kang and her spouse each own residential properties in Burnaby. Katrina Chen co-owns a residence in Vancouver with family and has a second home in Burnaby with her spouse. Ian Paton owns a home in Delta while his spouse owns one in Abbotsford.

George Heyman has a house in Vancouver, but with his spouse has a second house in Vancouver and a recreational property at an unspecified location in B.C.

Other properties are unlikely to be affected. Katrine Conroy has grazing land in the Kootenays, for example. John Rustad owns a wood lot license and four other pieces of rural property.

Several MLAs have interests in properties that are clearly out of reach of the tax. Doug Clovechok has an investment property in Calgary. Tracy Redies owns investment properties in Saskatoon and Virginia. Rick Glumac’s spouse has an investment property in Denver. Mike Farnworth has an investment property in the United Kingdom. Jagrup Brar has interests in properties in Alberta and India and Harry Bains has land in India.

– from ‘Many MLAs Have Personal Interest in Speculation Tax Hit’, Andrew MacLeod, The Tyee, 12 Mar 2018

File Under Tags: ‘Tolerant Vancouver Renter’ and ‘YouGottaBeKiddinMe’

Sun, 11 Mar 2018 16:52:27 GMT

“I’m an international student. When I moved here I asked for advice about the best place for me to live. I needed something close to my lab at VGH and also near to UBC, and Kitsilano sounded great. I was told to search on Craigslist, even though I’d heard it could be a bit sketchy. I thought, ‘How bad could it be’?

“The first apartments I viewed didn’t work out. They were closets downtown, or rooms separated in half by curtains. Then I found this house that seemed almost too good to be true. It was a great location, and the ad said that there were a few international people staying there. I never had a chance to Skype with the landlady, but we talked over Facebook Messenger. She seemed nice, and said that I’d have to pay a deposit right then. I did.

“When I got there, I found that there were more than 10 people living in the house. It was the smallest place on the street, and it didn’t look like it could hold so many tenants, but somehow it did. I think there was supposed to be five bedrooms, but the landlady had made plywood or fake walls, and then pushed a lot of people in a big basement. During one month I was there, we had 14 people staying. It was cramped, but I’d paid my deposit so I thought I’d stick it out.

“The first few weeks were okay. Everyone there was really nice. No one locked the doors, and people didn’t steal from each other. It was quite hippie, but nice. The landlady wasn’t around a lot, and that was cool. But then it started getting weird.

“She started moving more and more of her stuff into the house, even though she didn’t live there. She kept taking things from us. At one point, we had a washing machine and a dryer, and then all of a sudden it vanished. We got a new one that we paid for, but she told us we couldn’t have it because the neighbours were complaining. I have a suspicion she took it and sold it.

“She kept pushing more and more people into the house until it didn’t feel safe. Out of nowhere, six new international people would suddenly show up. Some would just stay in a van on the front yard, and she would charge $500 a week just for the sake of having them somewhere. Every now and again, a random person would wander in, and when we asked them who they were, they said they were there to view a room. The landlady wouldn’t say they were coming round, and after we tried to call her, she’d tell us to show them the house even though we didn’t know which room they were meant to be seeing.

“What pushed me over my limit was when she started doing odd renovations and spray painting everything. I’d go down and look at the basement, and the whole place would suddenly be bright pink, and the door would be sprayed gold. Then half the bathroom would be silver. It was just so strange.

“I found out she wasn’t technically the landlord, but was acting as a property manager. The weird thing was that I paid rent to her 16-year-old son. He would meet me on a street with two big dogs, and I would give him an envelope of money. She didn’t want to have any electronic transfers or any documentation of the rent. I don’t think she wanted the money to be able to be traced. We didn’t know who owned the place, but it looked like she handed over the rent to a guy who would randomly pull up in a van about once a month.

“I was there for five months. I definitely stayed too long, but it was tough because everything else I saw wasn’t even a room—it was a wardrobe with a curtain—or it would be really far away from my work. It was hard to find something.

“I was glad when I finally left. I haven’t been by the house since, but it’s tempting to walk past and see if it’s still standing.”

– whole story from Renters of Vancouver: “I paid rent to her 16-year-old son”, Kate Wilson, Georgia Straight, 10 Mar 2018

Vancouver “an international housing-affordability basket case” with “RE bubble risk the worst in the world” – Maclean’s

Thu, 08 Feb 2018 15:03:32 GMT

“It was such a lovely picture that the City of Vancouver managed to paint of itself over the 10 years that Gregor “Happy Planet” Robertson was mayor that it’s no wonder so many people believed it. A thriving and happily multicultural Pacific metropolis of bike lanes and balmy weather. Diversity and eco-density and backyard chickens, high-tech startups, and the ski slopes on the mountains just across Burrard Inlet.

Now, with Robertson on his way out, and his Vision Vancouver party a ruined brand, whoever comes out on top in the October civic elections will be left to deal with what’s become of the place. Vancouver is now a kind of free trade zone for gangland money launderers, absentee offshore real-estate speculators, Chinese princelings on the lam and globe-trotting tax frauds. Metro Vancouver is an international housing-affordability basket case and the epicentre of Canada’s fentanyl overdose crisis. Over the past decade, homelessness has doubled, at least 4,000 people are sleeping rough in the streets, and there are now 70 homeless camps across the region. …

For now, the job of sorting everything out has fallen mostly to David Eby, B.C.’s 41-year-old Justice Minister and Attorney-General. Two months ago, in a speech at a conference co-hosted by Transparency International Canada and the International Centre for Criminal Law Reform, Eby described Vancouver and British Columbia in the most accurately unflattering terms.

“We knew there was something strange going on, but, my God, we had no idea it was this big,” Eby said. British Columbia had become reduced to “a jurisdiction where the rules do not apply to white collar crime, fraud, tax evasion and money laundering, where even if the rules do apply, enforcement is absent.”

Over the past 10 years, the B.C. Securities Commission had collected less than two per cent of more than a half a billion dollars in fines levied against a rogue’s gallery of fraudsters, swindlers and ripoff artists. Among the beneficiaries of the previous Liberal government’s opaque “Advantage B.C.” head-office tax shelter scheme: PacNet, a collection agency the U.S. Treasury Department had listed as a transnational criminal organization with a sordid track record in money laundering and mail fraud, and China Poly Group, a shady Chinese state-owned enterprise with a payroll of 76,000, intimate ties to the People’s Liberation Army, and a portfolio that ranges from real estate development to arms and explosives and art exhibits. Advantage B.C. is now shuttered.

Among the sleazier aspects of the Liberal legacy was a peculiar toleration for dirty money being laundering through B.C.’s licensed casinos. Provincial officials were aware of the nastiness as far back as 2009. In January of that year, the Integrated Illegal Gaming Enforcement Team (IIGET) conducted a threat assessment focusing on organized crime in licensed casinos and asked the Crown-owned B.C. Lottery Corporation for expanded powers to tackle the problem. Six months later, the IIGET unit was disbanded because of “funding pressure.”

Last September, Eby appointed former RCMP deputy commissioner Peter German, an authority on money laundering, to come up with a series of recommendations on how to cut the flood of dirty money into B.C.’s casinos, Metro Vancouver’s overheated real estate market and “other areas of B.C.’s economy.” German’s report is due next month.

In the meantime, Eby has instituted a simple rule change aimed at preventing drug money from being loaned out by underground “banks” to visiting high-stakes gamblers. The change was recommended to the Liberal government in 2016 in a report by MNP LLP, a national accounting, tax and consulting firm. The Liberal government kept the report secret. Among its findings: over the course of a single month—July 2015—Richmond’s River Rock Casino accepted $13.5 million in $20 bills from mostly “high roller Asian VIP clients,” in transactions that sometimes exceeded $500,000.

The MNP LLP rule change that the Liberals ignored, but which Eby has put in place: You will no longer be able to drive your Lamborghini from your $10 million Point Grey mansion across the Oak Street Bridge to Richmond, stroll into the government-licensed River RockCasino and buy your chips with a half a million dollars in $20 bills stuffed into a duffel bag, then cash out on the same day.

It’s a start.

Last month, Vancouver showed up as the third most unaffordable city on Demographia’s list of 92 cities around the world, behind Hong Kong and Sydney. When it comes to cities undergoing a deterioration in housing affordability, Vancouver ends up the worst. Demographia classifies a property market with median home prices five times the median income to be “severely unaffordable.” In little more than 10 years, Vancouver’s housing affordability predicament worsened from a home price multiple of 5.3 to 12.6 by last year.

Andy Yan, an urban analyst with Simon Fraser University’s city program, has been tracking the deterioration in Metro Vancouver’s housing affordability for several years. In 2014, 28 per cent of detached homes in Metro Vancouver were valued in excess of $1 million. In 2016, the percentage had jumped to 43 per cent. As of July 1 last year, 73 per cent of detached houses in Metro Vancouver were assessed at $1 million or more. The 15-per-cent foreign-buyers’ tax imposed by the B.C. government in 2016 as a sop to public outrage caused only a slight pause. Within weeks, the upward climb in house prices resumed.

Back in 2011, when the average price of a Vancouver home was roughly 11 times the average household income, Mark Carney, who was the Governor of the Bank of Canada at the time, warned in a speech to the Vancouver Board of Trade that Vancouver real estate was taking on characteristics of financial asset markets that become trapped in “the classic market emotions of greed and fear—greed among speculators and investors—and fear among households that getting a foot on the property ladder is a now-or-never proposition.”

The greed and the fear took hold, compounded by a real estate spending spree of billions of dollars’ worth of capital spirited out of China by a variety of illegal, semi-legal and circuitous routes around Beijing’s currency controls.

The disastrous federal immigrant investor program contributed to this state of affairs by effectively selling Canadian citizenship to millionaire investors, mostly from China. The federal program was shuttered after assessments determined that the millionaires were contributing less to the federal treasury in tax returns than refugees. But the Quebec immigrant investor program continues in the form of a type of racket. Quebec skims an $800,000 interest-free loan from the investors as soon as they arrive. Most of them never settle in Quebec. Roughly half of the Quebec immigrant investors (28,000) have moved to Metro Vancouver, another 22,000 established residence in Ontario and elsewhere. Only 6,000 have stayed in Quebec.

A South China Morning Post analysis last December concluded that only about half of the primary breadwinners of immigrant-investor households remain in Canada after they settle their spouses and children here.

Meanwhile, detached houses and condominiums in Vancouver have become assets in a shadowlands protected by Canada’s lax money control policies. The British-registered charity Tax Justice Network, in its most recent Financial Secrecy Index, pegs Canada’s financial system as even less transparent than the setup in Russia or China.

Something is clearly rotten in Metro Vancouver’s property market. Household incomes reported to the Canada Revenue Agency in Metro Vancouver’s swankiest neighbourhoods are equivalent to incomes reported in the deeply impoverished Downtown Eastside. The disconnect between declared income and apparent housing wealth persists across Metro Vancouver “until you get out to the distant suburbs,” Eby says.

Two years ago, when the average detached home price within Vancouver city limits had soared to $1.4 million, the South China Morning Post crunched some numbers tallied up by the mathematician Jens von Bergmann at the Vancouver data firm MountainMath Software. What the data showed was that one in 10 Vancouver households were reporting a household income that was less than the amount required just for property taxes, mortgage payments, utilities and so on. That’s 24,960 households claiming to earn less in a year than they were spending on accommodation.

Another confounding figure: an almost equal number of homes within Vancouver city limits were empty last year. City of Vancouver staff identified 25,497 homes either vacant or occupied temporarily or by foreign residents. Of those, 21,820 homes were empty, year round. Mayor Robertson’s remedy was to apply an empty homes’ tax of one per cent of the home’s value. The program cost $4.7 million to set up and an additional $1.5 million in annual operating expenses.

It’s gotten so that it is practically impossible to determine how much of Metro Vancouver’s real estate is owned by Canadians, or even by local residents. A recent Transparency International study found that because of the presence of shell companies, numbered companies, trusts and proxy owners (students, spouses) listed as title holders, it is impossible to know who, exactly, owns about half of Vancouver’s pricier homes.

Last month, Statistics Canada released data showing that roughly five per cent of residential properties in Metro Vancouver appear to be directly foreign owned, but that figure may reflect only “the tip of the iceberg,” according to Haig McCarrell, director of StatsCan’s Canadian Housing Statistics Program. SFU’s Andy Yan crunched StatsCan’s numbers to discover that one in five of Metro Vancouver condos valued at $1.5 million or more (a typical three-bedroom condo lists at about $1.62 million) are foreign owned.

Among the items Vancouver housing activists want to see at the top of David Eby’s to-do list is the closing of the “bare trust loophole,” a tax dodge that Ontario outlawed in the 1980s. The loophole obscures the actual owners of a property and facilitates the evasion of various federal and provincial taxes.

On Feb. 20, B.C.’s New Democrats will unveil their first provincial budget in 17 years. The Union of B.C. Municipalities has put forward 32 proposals to address homelessness and clear up the housing horror show—mainly steep speculation taxes and investments in rental housing (Metro Vancouver’s rental vacancy rate currently stands at one per cent). There’s high hopes for the new $15.9-billion federal “co-investment fund” that Ottawa announced last year. Green Party leader Andrew Weaver wants B.C. to take a page from New Zealand’s playbook and ban foreign ownership of real estate outright.

Whatever B.C.’s new government does, deflating Metro Vancouver’s obscenely bloated real estate bubble should be expected to provoke stiff, big-money resistance. Vancouver’s real estate “bubble risk” is the worst in the world, according to the Global Real Estate Bubble Index compiled by the Swiss bank UBS. But at some point, Metro Vancouver’s property bubble is just going to have to burst.

And when that happens, there will be hell to pay.”

– from ‘The battle to clean up B.C.’, Terry Glavin, Maclean’s, 7 Feb 2018 [hat-tip El Ninja]

In our years of Vancouver RE Bubble-watching, we can’t recall a more adamant mainstream article… With this degree of shrill realization reaching voices like Maclean’s, the end has to be in sight. – vreaa

Vancouver Economy Over-Dependent On Debt Spending

Fri, 12 Jan 2018 18:32:10 GMT

When a mortgage is issued, money is injected into the economy from… nowhere.
Most people don’t realize this. Most think that mortgages come from money that originated in the real economy that is actually deposited in the bank, but that is most definitely not where mortgages come from. This ignorance is very widespread… poll intelligent people you know… you will find that most do not understand that commercial banks have the power to create new money. (A recent survey of UK Members of Parliament showed that the majority of them (85% !!) did not understand the source of mortgages… stunning information).

If somebody borrows $2 Million from a Canadian bank to buy a $4 Million Vancouver home, that $2 Million is created from nowhere. Nobody earned that money; the economy gets an artificial boost unrelated to any actual economic productivity within our society.

Vancouver has seemed to do well economically over the last 15+ years, largely because of the issuance of new debt. Vancouver has ‘imported’ money… from foreign sources, yes, but also from fresh air (and the latter source is greater and more important).

RE and closely related economic activity makes up 25% of BC’s GDP (2016). Construction is by far the largest new job generator in BC. Our economy has become highly dependent on an ever expanding RE sector (and ever increasing prices).

There were $38.4 Billion mortgage loan approvals in BC in 2010 on new and existing residential properties. (At 4.7 Million population this is $8,170 per capita per annum). We’d imagine more recent figures are considerably higher.*
BC has a GDP of $250 Billion (2015), so GDP per capita is $53,250.
Some of the newly issued mortgage debt must lead to the retiring of some old mortgage debt (when a sale completes) but we do not have figures regarding net new mortgage debt, which would be interesting (any readers have that?). That figure would represent the actual amount of newly created money released into the society from mortgages.*
When one considers that the ‘new money’, now in the hands of the seller, can then be used to be invested back into local RE (and leveraged again with more mortgage debt), one starts seeing how the RE ponzi can expand so malignantly.

Furthermore, if even a fraction of the new money is spent in other areas of the local economy, this makes our economy even more dependent on RE debt issuance. Add to this the ‘wealth effect’ of RE owners saving less and spending more because they believe their home is worth more and more, and one sees how dependence on RE price-expansion can spread deeply and broadly into an economy.

We don’t see any evidence that any real economic engines supporting Vancouver RE prices have fundamentally changed. There has not been growth in non-RE local economic activity anywhere near commensurate with the increases in RE prices. All evidence is that RE prices are still in a speculative bubble, fueled by debt.

This last year has seen a stalling in detached home prices and a 25% blow-off in attached prices.
If prices blink and lenders pull in their horns (with or without rising interest rates), the superficially virtuous cycle of a speculative debt-fueled bubble will implode, prices will plummet, mortgage debt will remain, and the cycle will become very vicious.

With Vancouver’s economy so overdependent on RE, we expect the inevitable reconciliation to lead to a deep local recession and many consequent adverse stresses on our society. Let’s hope we can weather the storm.

– vreaa

*PS: we’d welcome any updated figures from readers, especially info re net new money from mortgages.
Chart above from Ben Rabidoux.

hat-tip to El Ninja for links to these images:

Vancouver City Councillors Wake Up To ‘Fierce Speculative Demand’ – “There is significant evidence speculative investment has the biggest impact on housing costs in the city.”

Sat, 02 Dec 2017 19:29:47 GMT

“Speculative investment, the purchase of property based on anticipated price growth, has the biggest impact on housing costs in the city, according to Dan Garrison, a senior planner for the City of Vancouver. Some councillors feel this problem isn’t adequately addressed in the Housing Vancouver Strategy.

“There is significant evidence of speculative investment in our housing market that is driving housing costs,” Garrison said.
Gil Kelley, general manager, planning, urban design and sustainability for the City of Vancouver, said a lot of it has to do with excessive amounts of local and global capital from small and large investors looking to shelter their money and grow their equity.
“Vancouver is a very attractive city [as] a safe harbour for both B.C. residents and foreign investors,” Kelley said. “That coupled with low interest rates make for a pretty fierce speculative demand.”

– excerpt from ‘Vancouver to curb “fierce” demand by local and foreign housing speculators’, Thinkpol, 29 Nov 2017

Amen.
As we’ve been saying for… oooh… the last decade.
Solution to Vancouver Housing Conundrum:
Price crash to the point that all speculative interest is flushed out;
property prices then return to actual utility values as determined by actual ready money in our economy.
Problem solved.
– vreaa

The Dance Around Foreign Ownership of Vancouver RE

Mon, 27 Nov 2017 16:15:39 GMT

“..the City of Vancouver wants to collaborate with the provincial and federal governments to explore the viability of “restricting property ownership by non-permanent residents.”

That line appears in Vancouver’s 10-year housing strategy released Thursday, a comprehensive plan seeking to address all elements of the city’s housing crisis.

Upon learning the city’s new housing strategy proposes looking at restricting foreign ownership, Andy Yan told Postmedia: “It’s interesting … It’s the admission that you have a problem. As with many things in life, that’s the first step.”

“This does mark a bit of a sea change,” said Yan, now the director of Simon Fraser University’s City Program. “From the accusations that observers and critics are racists, to the realization that Vancouver does indeed sit in this global marketplace for residential real estate, through which local incomes can’t compete.”

The idea to investigate foreign ownership restrictions is one of a number of “tax and financial regulations to limit the commodification of housing and land for speculative investment” proposed in the city’s report, along with ideas like introducing a speculation and flipping tax, reforming federal and provincial tax regulations and seeking to “close loopholes.”

These proposals are designated as “high” priority in the city report, to be addressed in the first year of the 10-year plan.

Dan Garrison, Vancouver’s assistant director of housing policy, said Friday: “Our thinking on that has evolved in the last number of years … Whether it’s foreign ownership or investment from other sources, certainly that piece around investment driving housing costs is something that’s really ramped up in the public mind in the last couple of years.”

The city report raises the idea of investigating the examples of Australia and New Zealand, two countries where foreign ownership has been a red-button issue, that have both taken steps to limit foreign ownership.

B.C. Finance Minister Carole James is “reviewing the tax system and evaluating existing and proposed housing tax measures,” including the role of speculation in B.C.’s housing market, as part of the planning for the 2018 budget, James said Friday in an emailed statement.

“However,” James said, “a ban on foreign ownership of homes is not being considered as part of Budget 2018 planning. British Columbians are proud to welcome thousands of newcomers each year who help strengthen our province.”

– excerpt from ‘Sea change’: Vancouver considers ‘restricting property ownership by non-permanent residents’, Dan Fumano, Vancouver Sun 25 Nov 2017

Information From Outside The Vancouver RE Bubble – U.S. Senator Lives In (don’t laugh) $500K Home

Tue, 07 Nov 2017 16:02:16 GMT

The story ‘Rand Paul is tackled from behind and ATTACKED by his Democrat-voting doctor neighbor while mowing the lawn at his home in exclusive Kentucky gated community’ [Daily Mail, 4 Nov 2017] is weird from a number of perspectives, but, viewing it from the epicentre of the Vancouver RE cult, one truly bizarre piece of info leaped out at us… Rand Paul is a US senator, and his “exclusive Kentucky gated community home” (photo above) “is worth around $500,000”. Surely this cannot be correct! Somebody must have dropped a zero. Embarrassing.

“The Position Remains Unfilled”

Tue, 07 Nov 2017 14:53:28 GMT

“I have spent time in New York, London, San Francisco, Boston, as well as worked and interviewed in each. I also have discussed the experiences of multiple friends who used to live here and who now live in these places. Forget not being in the same ballpark. Vancouver isn’t even playing the same sport. All of those cities have far, far more opportunities than here – and far better compensation. The only thing Vancouver shares with them is high real estate prices.

Most people who have worked with executive search firms or are attempting to staff a mid-to-senior-level positions with non-local talent are having a devil of a time doing so. The most recent story I heard was at a friend’s company, where they were trying to staff a VP vacancy. The assessment of the outside international executive search team was that the proposed salary – based on the desired skill-set, the size of the organization, and the cost of living here – was around half a million short of where it needed to be. Yet the company simply didn’t have the ability to go higher. Thus, the position remains unfilled. I’ll grant you that there can be some alchemy that goes into the numbers used in these executive searches, but I have heard this same sort of shortfall in multiple other instances now.

You take a growing number of stories like those, stories about being unable to hire bar staff at $18/ hour, and everything in between – and you’re left with a failing community. The moment sharks start circling and making an actual concerted movement to entice young locals away – showing them just how much better they can do – this goes from being a gradually escalating problem to a full blown crisis in the private and public sector.”

– Royce McCutcheon, commenting at VREAA, 6 Nov 2017

Jessica Barrett – ‘I Left Vancouver Because Vancouver Left Me’ – “Like Living On An Abandoned Film Set.”

Mon, 30 Oct 2017 16:51:47 GMT

“I was, by many standards, the definition of success in Vancouver. I had a permanent, full-time job at the top of my field as senior editor of Vancouver Magazine, I had a rich network of professional connections, a solid group of close friends, and stable, albeit cramped and expensive, rental housing. Yet my entire life felt like a struggle. …

I quickly found the city I’d returned to had changed — and not just in the way that condo towers had supplanted even more vacant lots, old houses or beloved music venues. The tone had turned hostile. Property values, ever the stuff of shock and awe, had begun to skyrocket, defying even the most bullish predictions. Then the “million dollar line” moved out of Vancouver, erasing the division between east and west on the affordability scale. The revelation gave rise to a #donthave1million social media campaign which, for about a minute, became something of a millennial rallying cry. The response from the city’s powerbrokers — developers, newspaper columnists, etc. — was by and large blunt and cruel: if young people couldn’t afford it here, they should just leave. I shot back with a column detailing the absurdity of a city that is simply OK with the fact that its young cannot afford to live there and mused about whether it was time for me to leave for more welcoming pastures. …

My year away had opened my eyes to the fact that other cities also offered the uber-modern urban experience that Vancouver — ever narcissistic in its examinations — likes to think it has a lock on. …

This time, finding a place for my newly formed family of three —my boyfriend, me and his dog — was defeating and degrading. My place didn’t allow pets so staying put wasn’t an option. It took us four months to find a dog-friendly apartment in our price range with a reasonable amount of space (i.e. more than 450 square feet). In the two years since my last search, the rental market seemed to have gone completely insane. Half the listings we came across were scams, and apartments in once-affordable areas of the city, like the West End, or Main Street, were going for nearly $2,000 a month. Landlords seemed to demand everything just short of a claim on your firstborn child to consider you a serious contender. One woman refused us because I wouldn’t hand over my unredacted bank statements as proof of income to a total stranger.

While we searched we sublet, put our stuff in storage and lived out of boxes and slept on blowup air mattresses in bare rooms. My boyfriend started looking for work as a graphic designer and found the average pay in Vancouver to be $10,000 to $15,000 less than the same kind of work in Calgary, which, it bears noting, was in the middle of a recession at the time. Meanwhile, I had started my new job, which I loved, but the stress and instability of our housing situation made it difficult to focus on the demands of this new, high-stress position. …

My own collapse came when my partner declared that, although he did not wish to end our relationship, he couldn’t stay in Vancouver. I couldn’t fault him for a single reason he gave. We had finally landed in a 600 square foot coach house behind a mansion in Shaughnessy. It had a fancy address but the place itself was falling apart. The windows, which had been painted shut when we moved in, were now wedged open and wouldn’t close; the dishwasher (a major luxury we were excited to have) had broken and become a mildew factory, the door would only close when locked and would only lock if I heaved on it with my entire body weight. The heater in the bedroom buzzed so loud that I had to wear earplugs while I slept and we didn’t have a smoke detector. There was no storage, no place to put a kitchen table and nowhere else for us to go. For this, we paid $1,700 a month to a woman worth millions who clearly didn’t need the rent. It was obvious we were paying her to be onsite security for the winter months she spent in California.

The neighbourhood itself was like living on an abandoned film set. Aside from our landlord, we only ever saw construction workers, landscapers, and on occasion, the squatters who lived in the empty mansion across the street — just a line on someone’s investment sheet somewhere.”

– excerpts and photo from ‘I Left Vancouver Because Vancouver Left Me’, Jessica Barrett, The Tyee, 30 Oct 2017 [hat-tip Keith]

The whole Tyee piece is a must read.
Even for those of us familiar with all of the themes, this is a gutting story. The city really is hollowing itself out.
Greed and influence seem to have taken an even firmer grip of the reins and all momentum now is towards more and more and more of the same.
Perhaps a phoenix will rise out of the aftermath of a massive price crash.
Perhaps, later, Jessica and her family will come back. But I suspect she won’t, even if Vancouver miraculously becomes more hospitable, because she will have built a good life in Calgary (and Calgary will be the better for it).
– vreaa

“I’ve thought since early 2010 that Vancouver housing was in a bubble, and have refused to buy a house for this reason. I’ve felt that the risk of mean-reversion was far higher than the risk of missing the upside.”

Sun, 29 Oct 2017 07:49:37 GMT

“It’s all a speculative bubble. End of story. This includes housing prices in Vancouver (and elsewhere in Canada), as well as The Everything Bubble.

Any fool can lease a high end car. It doesn’t make you rich. It makes you fake – you live in a world of make-believe, which has been working out fine so far. But, all the wealth effect of rising housing prices here can be reversed in a heartbeat.

All bubbles mean-revert. Always. And the results are phenomenally painful, especially to the late-comers who thought the party would go on forever.

I’ve thought since early 2010 that Vancouver housing was in a bubble, and have refused to buy a house for this reason. I’ve felt that the risk of mean-reversion was far higher than the risk of missing the upside. Of course, I didn’t foresee interest rates staying at emergency levels for so long, and more stupidly, being actually lowered in 2015. I don’t really feel badly for having not bought, as it’s impossible to time the market and we could easily have been buying right at the peak at any time in the last 7 years. But, emotionally, I very much want to buy a house, so that my kids can grow up with better stability (my 7 year old is already living in her third rental house). Not that owning a house is a sign of stability, and our family’s/our marriage’s stability have not really been impacted by renting, but moving frequently is a huge drain of time and money. (and our credit scores are 832/850, with six figure investments/retirement savings, so we could buy if it made sense).

Now that Canadian (and Vancouver) real estate appears to have peaked and to be dropping though, I’m questioning if I even want to buy in the Lower Mainland in the foreseeable future. That would be buying into a declining asset class, which could even drop below the mean and stay there long term, due to upcoming structural demographic problems. I know this is considered impossible by the vast majority of Canadians, but if they would read about (1) asset bubbles, and (2) Japan’s economic situation for the last 20 years, a few might understand what I’m talking about.

My opinion is that, while both overseas buyers and local speculators have been absolutely desperate to get into the Vancouver housing casino game, that solid and sustained drops in prices here will have an ice water effect on their FOMO. I think that, like speculators everywhere, they will not want to actually lose money, and will do their very best to get their money out if at all possible. Those who can’t will ride it down. As it drops, the flood of speculative/store-of-value foreign “investors” will run, not walk, away from Vancouver and into safer markets in other countries.

Although I’m a 3th generation Canadian, born in Vancouver, I have lived in 4 other countries, and I understand there’s nothing magical about Vancouver. There are many special places around the world. Our ease of money laundering, ease of bypassing inconvenient and toothless taxation laws, and perceived strong laws and banking system have made us a magnet for all kinds of stolen money worldwide, money that in fairness should be helping to increase living standards in the countries of origin, not enriching a lucky corrupt few who managed to smuggle it out.

Please don’t see this as racist or against any particular ethnic or country group – I’m strongly opposed to corruption worldwide, and while I’m under no illusions, one of the things I love about Canada (and most of the other developed countries) is that levels of corruption are far lower here. You can be pretty sure that the police will help you when you need them, (without incentive payments), and not let you get away with things you shouldn’t, just because you’re rich. I welcome productive, honestly-earned foreign investment in Canada, and welcome productive, committed immigrants.

All those flashy cars bought for cash, top end clothing and jewellery being bought, dollars splashed around by young “rich” people? Well, when the money comes from dubious sources from one’s parents, it’s easy come, easy go. Or, it’s fake – the truly rich would not need to mortgage their purchases of Vancouver property, or lease those high end cars. But then, the truly rich don’t feel the need to buy such flashy excess.

Additionally, I am horrified at the massive expansion of credit and therefore debtload of all levels, worldwide – individuals, households, corporations, municipal and provincial governments. It is unprecedented and shocking — and unrepayable.

I see the result as nothing short of total economic collapse. The party simply can’t go on forever. “You can’t cure debt with more debt”. And, you can’t really inflate your way out of it, when trillions of QE mysteriously has not resulted in more than very minimal inflation. No matter how governments worldwide may try, I can’t see any way to avoid collapse, deflation, and depression. This is a terrible future vision, and I’m very saddened for the fate of my young children, and their possible children and so on. I worry so much that they won’t have health care when they need it, and that their safety will be at risk from desperate idiots who didn’t have the forethought to plan ahead and not consume beyond what they could afford. I worry about what we’re going to do when faced with seeing neighbours’ children going hungry – I can’t stand to see children hungry, but I can’t possibly feed them all.

It comes at a very bad time already, with climate change (yes, eventually the naysayers will have to admit it’s happening, whether they ever admit to the anthropogenic aspect of it or not) becoming an existential threat to populations worldwide. All it will take is one epidemic virus, with no money left to fight it, to devastate a large swath of humanity (not to mention the huge damage that so many billions of humans have already caused to every other form of life on this planet).

I’m sorry to be such a doom-and-gloomer, but I wish I could see a way forward for humanity that didn’t have this outcome. Yes, humans are incredibly adaptable and clever, especially in coming up with insane financial weapons of mass destruction (like CDOs, CDS, derivatives, rehypothecation, and all the other things that keep me up at night). These are nothing more than clever ways to transfer money from large numbers of middle class people/taxpayers to a small set of people who know how to play the game very well.

I’m not left wing, nor right wing, just somewhere in the middle like most Canadians, but I’m appalled at what we are doing to ourselves by taking on unrepayable debt just to keep up with the Joneses, to pretend we have lifestyles which we haven’t actually earned. This debt is merely pulling demand from the future, and it won’t be there when we need it – in the future, we can’t rely on the “consumer” to support our GDP growth or increasing quality of life. (and, nor is infinite growth in a finite world a real solution either)

Sadly, I can only see a return to a much more hand-to-mouth existence for much of the population of the developed world, and an even worse existence for the bulk of the world’s already poor and starving populations. The can can only be kicked down the road for so long. We just can’t extend and pretend forever, as much as our politicians don’t want to admit. I sure hope I’m wrong though.”

– ‘JCH’, commenting at VREAA, 28 Oct 2017

Many thanks, JCH. – vreaa

“It is very difficult to live here.”

Sun, 22 Oct 2017 17:54:13 GMT

“Famously liveable and famously unaffordable.”

“For nearly 40 years from his vantage point at the top of the Empire Landmark Hotel, Yunus Khan has watched Vancouver grow up. “You would barely recognise it,” he says of the city as it looked when he took his first job at the hotel, doing maintenance. Beyond the 42nd-storey window, the jagged silhouette of the North Shore mountains, the lush surprise of Stanley Park, and the cobalt passage of Burrard Inlet are just about the only landmarks that remain unchanged.

“These are all new,” Khan says, indicating a cluster of condo towers and the ultra-modern Sheraton Vancouver Wall Centre further south. Construction cranes rise around them. “Any older building you see now, it’s going. They break it down, make a high rise.”

What the view from the Empire Landmark offers is perspective: on the Canadian city’s past, present, and future. But not for much longer. The hotel, a downtown Brutalist icon from the 1970s, closes for good on 30 September. It will be demolished to make way for a proposed luxury condo development.

Khan plans to retire. He won’t miss the 60-mile round trip commute from the outer suburbs, or the frantic pace of life downtown. “Vancouver used to be a small town, easy,” he says. Now, you see all these tall buildings with the glass, it looks a bit more beautiful. But it is very difficult to live here.”

– image and text from ”We stand to wipe out a whole era’: how the 1970s could vanish from Vancouver’, Tyler Stiem, The Guardian, 27 Sept 2017 [hat-tip The (indestructible) Auteur]

And from the comments below the same piece:
‘I have visited Vancouver at least every decade and loved the place up until last year when I found that the downtown/Gastown area was being overtaken by gold-plated glass festooned high end shops a la Rodeo Drive. FFS. Oh, and there is a new Trump Tower as well. The Seattle waterfront area is going the same way, albeit without the Trump Tower. I see a pattern of homogenization of our cities. Screw that. Vive le difference. – TeeJayzed Addy

“We want young people to buy Real Estate.” – Vancouver’s Mayor

Sat, 14 Oct 2017 18:31:39 GMT

Saturn devouring his children – Goya

“In a statement released on Friday, Robertson says the proposed policy, which he intends to put in place by the end of the year, will give priority to local residents for sales of new homes in multi-family developments as part of the city’s new 10-year housing strategy. The city defines local residents as people who live and work in Metro Vancouver and whose permanent address and place of work is in the region, regardless of citizenship.

“My priority as mayor is to deliver new housing supply that is first and foremost for people who live and work in Vancouver, and this motion aims to give local residents the first opportunity to purchase a new home,” said Robertson. “In Vancouver’s red-hot housing market, local employers are crunched to retain talent, whether they’re doctors, tech workers, retailers, firefighters, teachers or nurses. I regularly hear stories about people who work in Vancouver, but are forced to move elsewhere in the region because they can’t find a place to live. At a time when we are seeing record levels of housing construction, local residents should be able to get the first shot at purchasing a home in new developments.”

“Vancouver’s Housing Vancouver strategy seeks to dramatically increase the supply of new housing, but it needs to be the right supply — homes that are affordable for people who live and work in Vancouver,” said Robertson. “We want young people and families to put down roots in the city. This motion will support that by helping make sure people who live and work here get the first opportunity to buy into new developments in Vancouver.”

– from ‘Vancouver’s mayor makes move to give locals first crack at condo pre-sales’, Scott Brown, Vancouver Sun 6 Oct 2017

Allowing our young to be first in line to buy preposterously overpriced RE, using large mortgages, will make them miserable, indentured wage slaves for life.
This will not solve Vancouver’s housing challenges, but will further impoverish our social environment.
The only ‘solution’ will be a bursting of the bubble, with a very large price crash, and a flushing out of all speculation in the market.
Such a price correction will return all properties to utility value, which is healthy.
Understandably, such a crash will never be facilitated by any incumbent government, at any level, and of any stripe.
Until then, expect many levels of government to continue to play ‘re-arrange the deckchairs on the Titanic’ with ineffectual policy tweaks (such as the one the mayor describes above).
– vreaa

“Vancouver RE Balloon Pricked; Median Price Detached Home Down >$500,000 to $1.7 million; Prices Need To Be Slashed”

Sat, 07 Oct 2017 22:17:06 GMT

Strong signs are appearing that Metro Vancouver’s real-estate balloon has indeed been pricked by China’s heightened capital controls.
Demand for multi-million dollar dwellings in Metro Vancouver is falling. “All the high-end stuff is sluggish,” says Vancouver realtor-analyst Steve Saretsky.
Sales volumes and prices on detached houses are especially dropping on the west side of Vancouver, in Richmond and in West Vancouver, where Mainland Chinese buyers had been active buying and building mansions.
Real Estate Association of Greater Vancouver figures show the median price of a detached home is down more than $500,000 since February, to $1.7 million.
Veteran Canadian real-estate data analyst Stephen Punwasi also has little doubt “Chinese capital is having a tougher time getting out of China” since leaders introduced tighter controls in January.
“Vancouver locals selling $3 million bungalows are going to have trouble finding an alternative to foreign urban land buyers, so prices need to be slashed,” Punwasi said.
– from ‘Is China bursting Vancouver’s housing bubble?’, Douglas Todd, 6 Oct 2017 [hat-tip to ‘The (indefatigable) Auteur’]

Pretty strong stuff for the Vancouver Sun.
This must give speculators (all buyers) pause.
23% down in 6 months? Gee.
Will anybody buy at these prices if they anticipate/fear future flat or decreased prices? We’d guess not, but we’ll have to wait and see how many “bargain hunters” step up to “buy the dip”.
Please see the last post for our discussion of why this is arguably an important juncture.
– vreaa

PS and BTW: The Auteur also kindly referenced a G&M article on how the BC NDP has essentially been petrified when it comes to promised housing action; in this regard we’d say this: No government can legislate or plan BC out of a gigantic speculative bubble in housing prices. There is no way to do that. Prices have become way too far removed from those determined by simple utility. The only way out is by a price crash (with no bailouts or any other silliness). That will solve the problem for a generation.

Detached Price Trend Remains Up, For Now. Speculators Hold Their Breath?

Wed, 04 Oct 2017 15:15:11 GMT

“Detached homes made up 30 per cent of all sales in September and represented 62 per cent [5,869] of all the homes listed for sale on the MLS® [9,466]. This dynamic has slowed the pace of upward pressure that we’ve seen on detached home prices in our market over the last few years.”
The sales-to-active listings ratio for September 2017 for detached homes is 14.6 per cent …
The benchmark price for detached properties is $1,617,300. This represents a 2.9 per cent increase from September 2016.
– from the REBGV Sept 2017 stats package

“Average prices in British Columbia are forecast to grow 2.2 per cent this year and remain unchanged in 2018, CREA said.”
– from ‘CREA cuts 2017/2018 outlook for home sales in Canada’, G&M, 15 Sep 2017

To reiterate, from our last post:
In a market that has come to expect 7% growth p.a. (with peaks to 25% p.a. being seen as normal) a substantial period of flat price growth will feel odd; almost like a contraction.
The eternal question for Vancouver RE is: “Will people be willing to step up and buy if prices are not rising?”
This is the essence of our longstanding belief that “all buyers are speculators” — we believe that people buy at these price levels not for utility, but largely for anticipated price growth. We believe they certainly would not be buying without anticipated price growth.

So, what will happen to Vancouver RE prices if prices stop rising? What happens if the speculative component of buying disappears?
We believe that this will result in prices dropping to a level that reflects the value of the utility of the property, and that currently such values are far, far below asking prices.

It’s too early to say, but it does seem that prices in some sectors of the market have stagnated.
Talk at the corner of Rumour & Grapevine is of $3M, $4M, $4M+ – ask-price homes getting no interest whatsoever, and being removed from market. Also of condos over $1M getting little interest. If the supply of eager buyers is limitless, why is this happening?
Perhaps that house isn’t ‘worth’ $4.5M if there is no longer a chance of it being ‘worth’ $5.5M next year. Perhaps its actually ‘worth’ closer to $1.5M (a price that would already value it richly for its actual utility), or even (preposterously!) $1M if we consider local incomes and historic norms. [This argument can be scaled for all levels of the market].

– vreaa

“Am I Buying This Home To Use It, Or For Anticipated Price Growth?”

Sat, 16 Sep 2017 16:17:08 GMT

Gambling chit or home?

“Paradise, meet purgatory: Average Metro earner reaps $72,000 a year, pays $1.4 million for a home”
– headline from The Province, 14 Sep 2017 [hat-tip to brian]

In a market that has come to expect 7% growth p.a. (with peaks to 25% p.a. being seen as normal) a substantial period of flat price growth will feel odd; almost like a contraction.
The eternal question for Vancouver RE is: “Will people be willing to step up and buy if prices are not rising?”
This is the essence of our longstanding belief that “all buyers are speculators” — we believe that people buy at these price levels not for utility, but largely for anticipated price growth. We believe they certainly would not be buying without anticipated price growth.

– vreaa

Postscript anecdote:
“I’ve started my active research in the detached market in my area. Inquired today about a detached 3br house in Langley (BC) nice neighbourhood, south-facing yard. Last Saturday we missed the open house, so I called the following Wednesday and inquired if they had taken any offers. “They listed after the long weekend and were going to take offers on the Tuesday but received no offers.” To which I replied “So do you think we could offer below asking, if we were interested?” He replied “Oh yea, definitely.”
– from PupPatrol 09.15.17 at 6:04 pm at greaterfool.com

“I’d been brainwashed by this market into thinking that paying for a million-dollar home means getting a total dump” … “When housing is so unaffordable that you drive out people who hold up the fabric of society, what’s going to happen?”

Tue, 29 Aug 2017 17:54:06 GMT

“Vancouver has become a hotel.” – Bing Thom, architect

“A family from England’s Midlands region arrived in Vancouver last July. The professional couple came here for work and set about looking for a house to purchase for their family of four.
After viewing a series of overpriced properties on the city’s east side, they plan to give it three more months. If they still can’t find anything, they consider Ontario.
K. Singh says her family lived well in England; both she and her husband make white-collar salaries. But in Vancouver, they have had to adjust their standard of living. Another family – friends of theirs who moved from England at the same time – have already returned.
“I had heard rumours. I wasn’t entirely surprised, but I was taken aback by the intensity of the situation, really,” Ms. Singh says. “I didn’t think it would be this bad. Some of our friends decided to go to Australia and they didn’t have the same battle.
“We are ordinary working people. All our taxes are paid – all kosher. When you do that, you don’t usually have a huge amount of money to begin with. We suffered a hit because of Brexit and the pound fell drastically.
“I worry about where society is going, because when it gets to that level [of unaffordability] and you drive out the people who hold up the fabric of society, what’s going to happen?”.
…
Ms. Singh says her family is too large for a condo and she has friends and family that want to visit from England, so she needs a house, but nothing fancy. She doesn’t think that’s a tall order.
“You’ve got two sets of people in this world,” she says. “There are the people who want to get what they can for themselves – nothing will ever be enough for them.
“I fall into the second bracket: you just want to pay the bills, have a bit for a rainy day, live comfortably with family, and have friends and family to come and stay.
“That’s not too much to ask, is it?”

—

Daina Lawrence found an east-side house for her young family after eight weeks of searching.
“After we went through the process, I realized that I’d been sort of brainwashed by this market into thinking that paying for a million-dollar home means getting a total dump,” Ms. Lawrence says. “I came to think of that as normal – which is brutal in hindsight.”

– two anecdotes from ‘Mouldy mini-mansions, pricey average homes: Vancouver house hunting is a wild ride’, Kery Gold, G&M, 25 Aug 2017 [hat-tip The Auteur]

Stoking The Housing Boom – “B.C. should close the bare-trust loophole for owning properties. Former Liberal finance minister Mike de Jong promised to get rid of it, but he reneged.”

Thu, 10 Aug 2017 06:07:13 GMT

The phenomenal popularity of Canada’s new 10-year visas is a key factor behind the latest housing booms in Vancouver and Toronto, say immigration specialists.
“I often travel to China, where I see the great pride many take in investing their money in Canada” — particularly by taking advantage of 10-year visas to buy real estate, said George Lee, a Burnaby immigration lawyer.
In 2015, Canadian immigration officials issued 390,000 10-year, multiple-entry visas to residents of Mainland China, the largest cohort, with another 162,000 going to people from India.
The former Conservative government began offering the 10-year visas in February 2014. As a result, in that first year, the number of travel visas handed to Chinese nationals tripled to 337,000.
Lee says the visas, which allow people to travel freely to Canada each year and stay for at least six months at a time, have sparked an explosion in foreign travel and property speculation in Canada, particularly from China.
The multiple-entry visas have caused a migration “chain reaction,” Lee said, which often leads to international students becoming proxies for offshore real-estate investors.
…
Hyman is particularly concerned about how a diverse range of real-estate speculators in B.C. use various means to obscure the legal ownership of property.
A multiple-entry visa offers “many people exactly what they want,” said Hyman.
“They want to be seen as tourists. They want to be off the radar of the Canada Revenue Agency,” including by being able to claim they’re not residents of Canada for income tax purposes.
The multiple-entry visa gives wealthy foreign nationals increasing opportunities to use their low-income-earning offspring and others as proxies, sometimes called “nominees,” to buy Canadian property on their behalf, according to Lee and Hyman.
Many wealthy foreign nationals employ their international-student children as channels for investing in real estate, they say, noting there are 130,000 foreign students in B.C., 51,000 of whom are from Mainland China.
“Some people are transferring their wealth to their dependents and then relinquishing their permanent resident status in Canada. They’re applying instead for 10-year visitors’ visas,” Hyman said.
He is particularly aware of foreign nationals, as well as domestic Canadians, using “bare trusts” and other loopholes to purchase properties and avoid paying taxes in B.C.
His worries echo a Transparency International report that says stronger tax enforcement is desperately needed in Canada and especially for Metro Vancouver, where governments can’t identify the owners of almost half the region’s 100 most valuable homes.
“B.C. is losing tens of billions of dollars in unpaid taxes related to property,” said Hyman.
Too many dubious ways exist — the immigration lawyer said — for real estate investors to obscure their identities and avoid paying Canadian income taxes, B.C.’s 15-per cent foreign buyers tax, B.C.’s property transfer tax or capital gains tax on real-estate profits.
To combat exploitation of Metro Vancouver’s housing market, Hyman said, one of the first things the new NDP government of B.C. should do is close the bare-trust loophole for owning properties.
Former B.C. Liberal finance minister Mike de Jong promised in October, 2015, to get rid of the loophole, said Hymen, but he reneged.
The Ontario government is far ahead of B.C. on this regulation, Hyman said. It closed the loophole in 1983.

– from ‘New 10-year visas stoke housing booms in Vancouver and Toronto’, Douglas Todd, Vancouver Sun, 6 Aug 2017

Housing accounted for the bulk of Canada’s economic growth last year. Brace for the end of the boom.

Tue, 01 Aug 2017 15:12:52 GMT

“Canada’s long housing boom has drawn thousands into the sector, from realtors and home stagers to construction workers, and a looming slowdown threatens to trigger an exodus that could wipe out many of those jobs and force the economy to shift down.

While housing has long been the main engine of Canadian growth, economists say a drop in home sales has already started to weigh on the economy and if price declines follow, consumer spending and jobs will suffer.

“To a lot of people, it is a get-rich-quick scheme,” Toronto realtor David Fleming said about the real estate market. “But history shows when the market turns, half of the agents leave.”

Realtors’ ranks in Canada’s largest city and hottest housing market have surged 77 percent since 2008 to more than 48,000 – nearly 10 times the pace of Canadian job growth. Nationwide, that number has risen 26.9 percent.

By comparison, there are over 13,500 realtors in Chicago, according to the Chicago Association of Realtors.

With Canadian home construction jobs rising at nearly the same pace as real estate jobs, housing has become the top driver of employment and economic growth, accounting for the bulk of Canada’s economic growth last year.

As the nearly one million housing sector jobs now far outstrip those in oil and gas extraction and mining combined and approach the size of the manufacturing sector, economists brace for a painful reckoning if the housing slowdown turns into a long correction.

More than half of the analysts polled by Reuters in May said a sharp housing correction was somewhat or very likely in Toronto and Vancouver, but unlikely nationally.

Recent data showed nation-wide home resales fell 6.7 percent in June, the largest monthly drop since 2010 and the third straight monthly decline as sales in Toronto tumbled, and sales are expected to slow further as interest rates rise.

While most housing bears have been focusing on how much home prices could drop, economists are also trying to work out how badly a resulting decline in consumer spending and housing jobs could hurt the broad economy. …

Veteran realtors who have seen the industry swell with inexperienced agents have no doubts that a slowdown will decimate their ranks.

“It is definitely overpopulated,” said Shawn Zigelstein, a realtor in the York Region, north of Toronto. “A downturn will weed out of some of those agents who got into the business for the wrong reasons.”

Already, many realtors are struggling in the crowded market. Nearly half of Toronto’s licensed realtors did fewer than two deals last year, according to Brian Torry, general manager at Bosley Real Estate in Toronto. Less than a third did five or more transactions.

“It is a tough industry to break into,” said Jared Gardner, 38, who got his real estate license last year and works in the Toronto area.

Fleming believes many agents are already making less than minimum wage once license, membership and brokerage fees are paid, and it can only get tougher if sales continue to dry up.”

– from ‘In Canada, a nation of realtors braces for the end of the boom’, Reuters, 1 Aug 2017

Mispricing of risk (too cheap money) has caused severe misallocation of resources, with speculators chasing hot sectors and being rewarded for risky behaviour. This has resulted in a ballooning of RE and related activities. Our economy has become overdependent on a concentration of activity, in an unsustainable fashion.
This phenomenon has been clear to some people for many years, yet it has been allowed to continue, encouraged even, because those with any control over monetary policy, the importing of money, or mortgage rates suffer conflicts of interest. The herd has been encouraged to run faster and faster, in one direction, and the imbalance has become more and more extreme.
This will all end. Laws of physics apply here as much as laws of economics – Canada can’t become a giant perpetual motion machine, with most of us doing nothing but selling houses to each other. Once the superficially ‘virtuous’ cycle, fueled by speculation, turns in the opposite direction, and becomes ‘vicious’, this sector collapse, and there will be all sorts of knock-on effects.
There will be great damage, but there will be good consequences, too:
The seemingly intractable housing ‘crisis’, that we now hear about constantly, will greatly benefit from a crash in prices. Housing that is priced close to those prices determined by fundamentals (the actual utility of the property) is healthy for an economy and a society.
– vreaa

Miloon Kothari, Former UN Investigator, Reviewing Vancouver Housing Crisis – “Hyper-speculation. Casino Capitalism. Gentrification. Collusion. Corruption. Criminal Investigations. A Lottery Which Reduces A Social Resource Like Housing To A Commodity.”

Tue, 20 Jun 2017 15:45:32 GMT

“Overall, I’m actually quite shocked on several fronts. One is that the housing crisis that I observed in 2007, 10 years ago, has become worse on virtually every level, whether you look at the level of homelessness, densification of poverty, the crisis of rental housing and the lack of housing options for low-income people. So that’s been quite surprising. These adverse housing and living conditions are partly fed by the hyper-speculation and gentrification you see all across the city.
I’m also quite disturbed by the fact that the city government, instead of playing the role of protecting housing options that lower-income people have, has been either through acts of commission or omission actually abetting this whole process. The kind of gentrification that you see happening in the Downtown Eastside, and that you see now in Chinatown is also being done through a process of rezoning, through the development of condominium buildings that drive up land values for adjacent areas. There doesn’t seem to be a commensurate attempt to increase the housing options for lower-income and modest-income people. You either see a shortage of shelters or inadequate conditions in shelters, a complete reduction in the number of single resident occupancy units, or the type of decrepit situation that you see at the Balmoral.
I don’t know what the logic is there, but [it’s] similar to the logic in other cities, where municipalities, in collusion with developers, deliberately let a particular area deteriorate and then it becomes an emergency. And then, when renovations happen, those properties don’t ever go back to the people who lived there before…”
—
“There’s no reason why the gentrification that is happening in the Downtown Eastside or Chinatown should be allowed. An entire area could be zoned off from this speculation to protect the low-income people living there. It has to be a political choice. It requires leadership at the political level. One can’t rely on the planners without the political sanctioning of such a policy. If you are doing rezoning, it could be limited to developing social housing for those most in need, not for the rich. A few token units for seniors and low-income people are insufficient. So I don’t see the city doing an adequate job in trying to stem that tide of gentrification.
The only conclusion you can reach is that there has to be collusion between the city machinery, developers, and obviously homeowners are de facto part of that too. That is who is benefiting from this system as it is. And it’s hurting the vast majority of the people who live here. We’re talking about millions and millions of dollars being made in this corrupt structure. People should be thoroughly embarrassed by this. If this were a similar situation in other countries, there would be investigations and hard questions being asked. Why are interest rates so low? Why are the banks being downgraded for being overexposed in the housing market? There should even be criminal investigations related to the real estate sector. The story of the unbridled real estate market in Vancouver is casino capitalism as its worst — a lottery which reduces a social resource like housing to a commodity.”

– from ‘Vancouver Housing Crisis ‘Worse on Virtually Every Level,’ Says Former UN Investigator’, an excellent interview with Miloon Kothari by Am Johal, The Tyee, 20 June 2017

‘Flip Vancouver’ Speculator Invite Flyer

Tue, 20 Jun 2017 06:20:51 GMT

– flyer targeting local RE speculators, found downtown June 2017, archived for the record [thanks to Westside Frank]

“Local Speculators Are Cashing In While We Blame Foreigners” and Other Truths – Geoff Dembicki, The Tyee

Mon, 19 Jun 2017 16:58:06 GMT

You’ve heard it a million times. The reason so few of us can afford Vancouver is because there aren’t enough new homes being built. This is the version of reality that real estate industry leaders and their political allies want us to believe.
But an investigation of the industry by The Tyee has revealed reality to be much more complex. Over the past six months I spoke at length with financial analysts, economists, industry consultants, realtors and many others to learn the true causes of Vancouver’s housing crisis and who is profiting from it. They were in broad agreement that real estate is at the centre of a massive realignment between our society’s rich and poor — and one that few leaders in the industry seem willing to publicly acknowledge. Here are the key takeaways from those conversations.

1. The industry no longer sells homes — it sells investments

Real estate has historically been a local industry. The people who buy and sell a city’s homes tended to live in that city. Yet that all began to change a decade or so ago. And one of the major reasons for it is a big shift in our global financial system. It’s a complicated subject. But what you need to know is that the global capital investors use to invest in things is growing much faster than the actual economy. There is so much capital, investors don’t know what to do with it all. Desperate for quick financial returns, many investors are pouring this capital into real estate, turning local markets into global investment opportunities. One of the results, according to trackers such as Bain & Company, is “skyrocketing home prices.”

2. Wealthy people are profiting from the housing crisis

The explosion of global capital coincided with an explosion of global wealth. Worldwide, the number of people worth $30 million or more has grown 60 per cent in the last 10 years. These elites have a different relationship to real estate than regular people. High housing prices aren’t a hindrance to the ultra-rich. The pricier homes become, the more desirable they are as a marker of social status. That’s why one top investor not long ago compared Vancouver condos to contemporary art. Rich people are less likely than the rest of us to live in the homes they purchase. A poll done by the group Knight Frank suggested the most popular reason rich people acquire real estate “is as an investment to sell in the future.” Which means they profit when prices rise.

3. Rapidly rising house prices are deepening class divides

Unaffordable homes are not just a drag on people’s incomes. The housing crisis is doing lasting damage to social mobility. If you are hoping to improve your income, your best bet these days is to live in — or relocate to — a large, globally connected city. Over 90 per cent of new jobs in Canada over the past several years were created in just three such cities: Vancouver, Toronto and Montreal. And of those, Vancouver has Canada’s fastest growing economy. But housing is so pricey that those opportunities are denied to many people. One real estate economist worries that “we are driving a very large wedge between the lowest income earners and the highest income earners.”

4. Industry leaders are convinced the middle class is dying

The real estate industry is aware social mobility is declining. Its leaders know there is huge demand for cheaper homes. But they prefer to profit from income inequality rather than doing anything about it. That’s one takeaway from a major real estate industry trends report produced by PwC and the Urban Land Institute. “The middle class has been hollowing out,” it concluded. With land prices going up in big cities, the industry is increasingly focused on building luxury homes for wealthy people. Not everyone thinks it’s a wise strategy. “Time will tell if that’s going to come back to haunt us,” said one CEO. “Not everybody makes $75,000 to $100,000 a year.”

5. Your intimate data is being used to drive home sales

Even if you don’t earn much money, you can still be valuable to the real estate industry as a source of data. It’s likely not news to you that almost everything you do online — and off — is tracked and sold to advertisers. But what is new is that the real estate industry is now trying to get in on the action. Companies are creating technology that mines public records and notifies realtors when a potential client gives birth, declares bankruptcy or files for divorce. Industry forecaster Swanepoel predicts “this technology will be huge.” But at what cost to privacy? Or our right to control our identities? “I don’t think anybody has the answer,” said one observer.

6. Political leaders aren’t telling the full story about housing

What we can be certain of is that politicians aren’t telling the full story about the true causes of unaffordability. British Columbia Premier Christy Clark has argued “the only way to really solve” the housing crisis is to build more condos. And during the provincial election, her BC Liberals took any chance they could to blame the red tape and protesters they claim are standing in the way. Yet the majority of new condo units are sold to speculators. More supply isn’t helping locals. The market does what it knows best: maximizing profits. Which is why industry insiders like Richard Wozny argue the “only group at fault are politicians” — those who know what the problem is but refuse to fix it.

7. Local speculators are cashing in while we blame foreigners

The most substantial step the BC Liberals took towards fixing Vancouver’s housing crisis was the 15 per cent Foreign Buyers Tax. At first the tax seemed to work: home sales and prices fell. But prices are once again rising. And this time transactions involving overseas buyers are at relative lows. “Everything we see suggests that there is a whole lot more domestic investment activity in the real estate sector than foreign investment,” said the head of Canada Mortgage and Housing Corp. Foreign money is a big cause of crazy home prices. But so are Canada’s historically low interest rates, which make it “almost stupid to not buy property,” argued the site Better Dwelling.

8. Income inequality is causing a boom in luxury retail

Real estate has become a zero-sum game in Vancouver. Those at the top are doing better than ever, while everyone else struggles. It’s a fair assessment of our wider economy. Recent data from Stats Canada showed that average Canadian incomes have stopped increasing. Yet the ranks of the ultra-rich in Canada are growing faster than in the U.S. — between 2006 and 2016, the number of people worth over $30 million rose 50 per cent in this country. These elites want to flaunt their wealth. And the boom of luxury retailers across the country is happy to oblige them. “High-end retail will prosper as the high-end population does well,” noted one real estate analyst.

9. People within the industry want serious solutions

What the May provincial election showed is that people across the province, but particularly in urban regions, want serious change. They are sick of being priced out of their cities. They’re fed up with an economy that privileges the wealthy. And they’re tired of being lied to. The NDP-Green coalition now has an opportunity to make things better. Leaders of the two parties promised housing policies that “will have an impact,” local realtor Steve Saretsky told The Tyee. He is one of many people within the real estate industry who supports solutions to our current housing crisis. “A lot of realtors I’ve spoken with want some sanity to the market,” he noted. “They know it isn’t sustainable.”

– text and image from ‘Nine Things the Real Estate Industry Doesn’t Want You to Know’, Geoff Dembicki, 19 Jun 2017 [an article important enough that we are archiving it here in its entirety] (hat-tip to Keith)

Longtime readers of this blog will be familiar with many of these factors.
A very good article and hats off to Geoff Dembicki for pursuing.
The potential future for our city is that it will either increasingly look more and more like a gated airport/casino, or it will suffer a massive RE price crash.
– vreaa

“Nuthin’ That A Good Ol’ 75%+ Price Crash Won’t Fix…” – BOC Governor Stephen Poloz *

Sat, 17 Jun 2017 15:04:50 GMT

(Yeah, the font is too small to read exactly, but, you get the idea.)

Massive and risky home loans are increasing in number across Metro Vancouver, while mortgage fraud cases are also on the rise, connected to the growth of so-called “shadow banking,” a Postmedia investigation shows.
The trend of increasingly risky loans underlying Metro Vancouver’s high home prices is illustrated by Bank of Canada figures that show the rapid growth since 2014 of large mortgages made to people with relatively low incomes.
This is a growing danger for Vancouver’s real estate market, because under new tighter lending standards introduced for banks in fall 2016, the Bank of Canada says that many of these big mortgages can no longer be insured, and won’t be issued again by federally regulated lenders.
As a result of the tighter federal lending rules, borrowers trying to buy million-dollar-plus properties in Vancouver’s market are increasingly taking out dangerous loans from shadow bankers in a fast-growing and poorly regulated financial market.
There is also evidence of growing links between shadow banks and traditional banks, according to the Bank of Canada’s June 2017 report, as people borrow large amounts from shadow lenders to use as down payments in order to qualify for lower-interest loans from federally regulated banks.
“Price increases in Vancouver and Toronto have an element of speculation to them,” Bank of Canada Governor Stephen Poloz said last week, while issuing the bank’s biannual financial system review. The review showed “riskier characteristics are increasingly evident” in new mortgages.
A December 2016 Bank of Canada report estimates shadow lenders now account for $1.1 trillion in debt — about half as much as the traditional banking sector — and that over the past decade “these new players have become more important and have changed the face of the Canadian mortgage market … (as) tightening bank regulation can lead to migration of activity from the traditional banking sector to the shadow banking sector.”
…
Postmedia’s review of over 30 regulatory or civil court cases shows a trend of allegations that home buyers and real estate professionals are involved in deceptive mortgage applications that include exaggerating the incomes of borrowers, forged documents of home ownership used by multiple borrowers to obtain mortgages, phoney claims of offshore assets used to back home loans, falsely inflated collateral accepted by subprime lenders to fund real estate development loans, and falsified CRA tax return documents.
For Hilliard MacBeth, an Alberta-based author and wealth manager, the Bank of Canada loan risk statistics and the related growth of shadow banking in Vancouver and Toronto herald a crisis.
“These properties in Vancouver are so expensive that you need people either laundering money or loan fraud or people borrowing such large amounts of money that should never be allowed, in order to keep it going,” MacBeth said. “If everyone is reporting their incomes honestly in Vancouver, there is no way that housing prices can stay where they are.”
– image and excerpts from ‘Risky mortgages, shadow bankers threaten Vancouver housing market’s stability’, Sam Cooper, Vancouver Sun, 16 Jun 2017 [hat-tip to The Auteur; and hats-off to Sam Cooper for pursuing this]
—
(* The author has exercised their right to poetic license in the writing of the title of this post.)
But, seriously now folks, notice how none of the mainstream players and commentators consider the option of a price crash as a solution to most of Vancouver’s housing problems.
A price crash, a real price crash, would flush out all speculators and all appetite for speculation for about two decades, perhaps even three. The price of accommodation in our fair city would drop to fair fundamental values (perhaps lower for a brief period). All housing would be used, as there would be no pie-in-the-sky jackpot for those who wanted to hold ‘units’ like poker chips. Lending would tighten to the point that one would have to be able to support a purchase with demonstrated income (novel idea!).
Sure, people would get hurt, but people are hurtin’ now, and who is to say who should be hurtin’ and who shouldn’t?
Real estate and related activity would drop from, what?.. its current inflated 30% of the economy to a more historically normal less than 10%. Kids would go to classes rather than smoking weed while tacking cheap shingles to roofs without harnesses. We’d be able to talk about things other than RE at BBQs (I know this may be difficult, but we can do it!). Our minds (and behaviours) would stop being blown and distorted by stories of professionals making more money via their modest house than that saved and invested from an entire 40 year career of honest earnings.
Homes would become homes again.
Vancouver would never be cheap, or ‘free’.. nobody’s expecting that. But ‘honest’ prices, determined by those who actually want to use properties and are prepared to fund them from their own actual funds, would be a very good thing for the longer term health of the city.
– vreaa

Reconsidering High-Rises – “These people do not want a neighbourhood. They want a locked gate, a gated community in the sky.”

Fri, 16 Jun 2017 04:59:30 GMT

How many times should we say it? Don’t build residential towers. Don’t make or let people live in them, least of all families. They are antisocial, high-maintenance, disempowering, unnecessary, mostly ugly, and they can never be truly safe. No tower is fireproof. No fire engine can reach up 20 storeys, period.
Towers are again raising their heads across the urban landscape, creatures of egotistical architects, greedy developers and priapic mayors. We gasp at their magnificence, their extravagance, their sheer height. Yet like Grenfell they are alien creatures in a British city. They do not converse with their context, they thumb their noses at it.
…
There is no need to build high at all. The developers’ cry, that cities must build high to “survive”, is self-serving rubbish, the more absurd when their towers are left half-empty. The principal reserve of residential space in British cities is derelict land and the under-occupation of existing houses. Unless we wish to build at the squalid densities of Mumbai and Hong Kong, high buildings require space round them and extensive ground servicing.
Hence the most “crowded” parts of London are not around towers but in eight-storey Victorian terraces. The boulevards of central Paris have treble London’s residential density without towers. Westminster council’s aborted Paddington Pole, at some 60 storeys, had fewer housing units than the high-density street housing suggested by its opponents. The tall blocks wanted by Boris Johnson for Clerkenwell’s Mount Pleasant estate are at a lower density than the low-rise town houses proposed by the consultants Create Streets.
Besides, people are entitled to the city they want. When in the 1980s Liverpool’s Militant movement asked Everton’s inhabitants what should be done with their towers, the reply was pull them down and give us back the streets. It was done.
Today’s surge in tower building – some 400 are in the pipeline of London’s uncontrolled property market – is driven by a quite different demand. It is from high-income migratory couples and foreign buy-to-leave investors. These people do not want a neighbourhood. Their social life is dispersed. They want a locked gate, a concierge and a pied-à-terre with a view. They want a gated community in the sky. When I moved from a tower flat to a street flat, I encountered a completely different city, exchanging what amounted to a self-catering hotel for a community of neighbours.

– image and excerpt from ‘The lesson from Grenfell is simple: stop building residential towers’, Simon Jenkins, The Guardian, 15 Jun 2017

Wake Up Canada! – Countries By Population Density

Tue, 13 Jun 2017 03:50:18 GMT

The red square on the map above represents the amount of space it would take to provide every household in Canada with a 66ftx122ft lot (which is twice the size of a standard Vancouver lot).

Population density (people per square km):

Monaco 18,589
Singapore 7,797
Hong Kong 6,644
Taiwan 650
South Korea 513
Netherlands 412
India 401
Israel 394
Philippines 347
Japan 335
United Kingdom 268
Germany 232
Nigeria 208
Italy 201
China 144
Denmark 134
France 123
Portugal 112
Jordan 111
Austria 105
Turkey 102
Egypt 93
Spain 92
Iraq 85
Greece 82
Morocco 77
Croatia 74
Mexico 63
Yemen 54
Iran 49
South Africa 43
United States 33
Canada 4 (yes, four — not a typo)

C’mon people! Open your eyes! Think!
– vreaa

Fun Facts:
Did you know that Vancouver Island is bigger than Belgium?
If the entire population of Canada moved to Vancouver Island, the population density there would be 1,145 people per square km.
If the entire population of Canada moved to the island of Newfoundland, the population density there would be identical to that of Japan (330 people per square km) and less than that of the Philippines, Israel, India, the Netherlands and South Korea.

The amount of space it would take to provide every person on the planet with a standard Vancouver size lot.

Low Interest Rates, Foreign Capital, Local Speculation

Mon, 12 Jun 2017 14:06:46 GMT

“Here, in a nutshell, is what Saretsky has learned. The reason most Vancouverites can’t afford a home is because of three related trends. The first thing you need to know is that low interest rates make it easier than ever to borrow money and invest in real estate. The second is that buyers from China and elsewhere are investing in the market at record levels. The third is that as real estate prices across the city skyrocket, a surge of domestic speculators — including first-time buyers worried they’ll miss their chance to buy a home — is causing prices to go even higher.
Or in Saretsky’s words: “I would boil it down to low interest rates creating an easy credit environment, slash foreign capital coming in and distorting the market, and ultimately, as prices went up, it fuelled a fear-of-missing-out speculation.”
– from ‘A Realtor’s Revolt – Why Steve Saretsky is exposing the truth about Vancouver’s real estate industry’, Geoff Dembicki, The Tyee, 12 Jun 2017

Gee, this guy sounds like us.
Note how he correctly classifies first-time buyers as domestic speculators.
All buyers here are speculators, have been for many years. – vreaa

Unstoppable?

Sat, 03 Jun 2017 22:13:58 GMT

May 2017 – REBGV New Average Sale Price Highs:
Detached $1,831,000
Attached $859,000
Apartments $657,000

Vulnerable

Wed, 31 May 2017 15:19:44 GMT

– image from ‘Lamborghini collides with fire hydrant at downtown Vancouver intersection’, by Harrison Mooney, Vancouver Sun, 30 May 2017

What has this got to do with Vancouver RE? you might ask.
An excellent question, dear readers.
Ok, so the references are oblique, and we don’t fully understand them ourselves.
And, while we’re talking about elusive understanding, we don’t understand why anybody would spend a gazillion dollars to buy (lease?? test drive???) a car that is shorter than a fire-hydrant is tall…
I mean, think about it.. the fire-hydrants are looking DOWN on you when you drive past lying down in that thing…
Nostalgia for go-karts may have something to do with it.
We’ve never understood the appeal of these cars.. their engines sound like sewing machines..
Anyway, believe it or not, but this incident became a full article in what’s left of our city’s only newspaper.
Slow news day?
Back to possible RE associations:
Going too fast. Hubris. Unexpected obstacles. Superficially powerful but actually very fragile. Look at me I’ve got lots of money. Vulnerable. Walk away from deposit.
– ed.

Toronto Bursting? – “People need to ask themselves very carefully, “Why am I buying this house?”

Sat, 27 May 2017 05:41:49 GMT

During the first two weeks in May, according to preliminary data from Toronto Real Estate Board, home listings surged 47% from the same period last year even as sales plunged 16%. The average selling price dropped 3.3% from April – and this, after a 33% year-over-year spike in home prices in March and a 25% surge in April. Something is happening to Toronto’s blistering house price bubble.
—
It comes after Bank of Canada Governor Stephen Poloz warned in April that home prices are in “an unsustainable zone,” that the market “has divorced itself from any fundamentals that we can identify,” that there was “no fundamental story that we could tell to justify that kind of inflation rate in housing prices,” and that “It’s time we remind folks that prices of houses can go down as well as up. People need to ask themselves very carefully, ‘Why am I buying this house?”’
—
“We are seeing people who paid those crazy prices over the last few months walking away from their deposits,” Carissa Turnbull, a Royal LePage broker in the Toronto suburb of Oakville, told Bloomberg. She said they didn’t get a single visitor to an open house over the weekend. “They don’t want to close anymore.”
“Definitely a perception change occurred from Home Capital,” Shubha Dasgupta, owner of Toronto-based mortgage brokerage Capital Lending Centre, told Bloomberg.
“In less than one week we went from having 40 or 50 people coming to an open house to now, when you are lucky to get five people,” Case Feenstra, an agent at Royal LePage Real Estate Services Loretta Phinney in Mississauga, Ontario, told Bloomberg. “Everyone went into hibernation.”
—
In Canada, the theory has spread that real estate values can never-ever go down in any significant way – on the theory that they always go up – because they didn’t take a big hit during the Financial Crisis, and because the prior declines have been forgotten. So optimism about rising home prices had been huge. Now weekly polling data by Nanos Research for Bloomberg is showing the first signs of second thoughts. Two weeks ago, the share of people saying home prices would rise in the next six months was a record 50.1%. The following week, it dropped to 47.7%. In the most recent poll, it dropped to 46%.
But those who are able to sell at what appears to be the very tippy-top of the market are not complaining. Bloomberg cites business school professor Michael Hartmann who put his north Toronto home up for sale on May 17 sold it on May 22 for C$1.65 million, C$10,000 above asking price. He and his wife are planning to rent and see.

– from ‘All Heck Breaks Loose in Toronto’s House Price Bubble’, Wolf Richter, 24 May 2017

Prices haven’t started to drop yet, so can’t really say… But, could be.
I particularly like the BOC Governor’s suggested question from April: “People need to ask themselves very carefully, “Why am I buying this house?”
Exactly! Regular readers here will know we’ve been discussing this point for years.. If even part of the answer is “because the price will go up”, the buyer is a speculator.
– vreaa

An Economic Boom “In All The Wrong Places”

Wed, 24 May 2017 15:30:06 GMT

The Bank of Canada is keeping its key interest rate unchanged at 0.5 per cent as it weighs the clashing forces of falling inflation and a surprising burst of economic growth.
But the central bank warned Wednesday that both factors may be temporary.
The torrid growth in the first quarter – now on a pace to hit 4.7 per cent annual rate – will be followed by “some moderation” in the April-to-June quarter, the bank said in a statement. In April, the bank had forecast 3.8 per cent GDP growth in the first quarter.
—
Wednesday’s decision marked the 15th consecutive time since July 2015 that the central bank has left its key rate unchanged. Most economists don’t expect the bank to begin raising rates until at least early 2018.
—
“The main message is that the bank now clearly sees the balance leaning more to the side of raising rates, rather than cutting them,” Bank of Montreal chief economist Douglas Porter said.
—
The bank also acknowledged the hot Ontario and B.C. housing markets, noting that recent government efforts to stop speculation and risky borrowing “have yet to have a substantial cooling effect.”
—
“The Bank of Canada sees an economic boom in all the wrong places,” CIBC economist Avery Shenfeld said in a research note.
– from Bank of Canada holds rates amid boom ‘in all the wrong places’, G&M, 24 May 2017

Three-quarters of Canadian mortgage holders would be unable to manage a modest increase in interest rates.
Three. Quarters.
– El Ninja, on VREAA, citing this Vancouver Sun report

I’ll just leave this here:
An economic analysis released on May 4 by the Desjardins Group predicted that the central bank may increase its benchmark rate by 0.5 percent per year starting in 2019, bringing it to about 2.5 percent by 2021. According to the Desjardins paper, that could mean a two-percent increase in variable and five-year fixed mortgages.
“It will make it even more unaffordable to buy a property,” Kadi said about the prospect of higher interest rates.”
– BlaMmO, on VREAA, citing this Georgia Straight article

—-

Cheap money plus good story leads to housing bubbles.
Looks great on the way up, everybody loves it, especially the banks and the politicians. And owners, RE ‘investors’, Home Depot, kids with new trucks drywalling, [any poor value local item dependent on wealth effects].
‘Wealth’ is created out of thin air with every mortgage created. (Free money!)
Bonus extra level of juice if you’re importing some of the downpayments.
However, all pretty much a ponzi, and when you run out of air, what then?
The whole process in reverse really, really sucks.
– vreaa

A Few Charts

Fri, 12 May 2017 04:38:23 GMT

– from mybudget360.com

Sometimes charts say it all.
– ed.

A Reader’s Perspective

Thu, 04 May 2017 17:36:16 GMT

This via email from a reader, who prefers to keep their name out of it, so here shared anonymously:

“I like reading your blog. Thanks for the perspectives.

The perspective that the Vanc prices are a “bubble” and “will crash”, implies that “it is all froth, no substance”, and there are no fundamentals behind what is happening.

I like reading your articles. However, l remain unconvinced about lack of fundamentals. Such as:
Globalization (ie sort of free movement of capital, people, products, information).
Low interest rates (ie:prices are about selling mortgage payments).
Low Canadian dollar make Cdn “cheap” (tanked to support oil exports).
Vancouver is a safe haven for rich people (ie: income tax evasion, no extradition, free education & health care as no income taxes).
BCLiberals and Fed’s are wealth managers for corporations/real estate & construction industry/etc. (ie: bought and rewarded by).
Property ownership is a right (ie owners and buyers can sell/buy how they like; just like for your car/used computer/etc).
Vancouver and area is a nice place to live. (for many reasons, not perfect, but nice). Some net 50,000 people moving here per year creates demand for housing.
Declining inventory of detached homes relative to all inventory (gobbled up for condos/etc).
Prices will not crash and stay low; rather they will fluctuate, but generally will follow inflation as minimum.
Vanc is not some industry dependent town that booms and busts; it has it’s own appeal/demand.

Not to say there are not issues. There are:
Stalled incomes.
Tax unfairness.
Public policies not in Cdn public interest.
Hijacked democracy.
Unaffordable housing.
Other sectors crushed by unaffordable housing.
And many others too in education, infrastructure, congestion, cultural.

Our governments can/should be doing more:
Buying up land in advance of transportation development (that is then allocated to public housing at cost, like how Whistler does; keeps cost lower).
Advancing mortgage money at Provincial rates.
Builds are done at cost, and exclude developers who add 20% profit to cost.
Rules to keep this housing in “affordable housing pool” (not allowed to be sold for “market”; see Whistler model, or Coop model?).

As a taxpayer – l am not in favour of subsidies. One taxpayer paying another kind of taxpayer. Not fair. And then tax payers are subsidizing the profits to banks, land developers, developers, speculators, etc. Not fair.

We need to shake off the concept that the free market solves social policies. The evidence is they don’t. The free market (made up of banks, developers, real estate industry, construction industry) can never ever sell housing that is affordable – not when their goal is “what the market will bear” or “sell to the highest bidder”, and maximize profits. Only a controlled gov’t intervention, at zero cost to the tax payer is fair to both taxpayer and those in need of affordable housing.

That there will be a crash? I don’t think so. Not permanent. Too many rich people/corporations depend on prices where they are. So does the gov’t who is both the silent partner (makes money) and wealth managers for these industries.

I think looking at what is “fair” for the most people, and “good” for all constituents, would be a more compelling perspective to effect helpful change on affordability. My two cents.

Regards.”

Thanks for these thoughts, Anonymous Reader.
I have many thoughts, but I’ll share just one:
Market participants (whoever they are) “depending on prices where they are” have never prevented market crashes.
– vreaa

“B.C.’s economy relies on the selling off of real estate instead of actual jobs. It’s reached the point where we don’t have much to sell, other than the land itself.” – filmmaker Charles Wilkinson

Sun, 30 Apr 2017 15:33:23 GMT

Vancouver’s real estate market has attracted angry commentary from a wide variety of sources lately, and not just citizen activist groups rallying for affordable housing.

A couple of weeks ago, U.S. economist Michael Hudson sold out the Rio Theatre to talk about the city’s gone-sideways housing situation, which he compared to “a feudal society.”

Mother Jones magazine has a feature story about Vancouver in its current issue, Hedge City Blues: What happens when global elites invade your town?, which cautions that Seattle is next.

This week, local filmmaker Charles Wilkinson is releasing his film on Vancouver’s crisis, No Fixed Address, which opens May 2 at Toronto’s Hot Docs festival. The film will also screen at Vancouver’s DOXA Documentary Film Festival on May 6.

And in an unusual twist, a member of the region’s development community is incensed enough that he too is weighing in on our spectacular failure to regulate big foreign money.

Consultant Richard Wozny has been a key player in Vancouver’s development industry for 33 years and he just wrote a report: Low Incomes and High House Prices in Metro Vancouver. Mr. Wozny has, as he puts it, worked endlessly to make wealthy developers wealthier. Now nearing retirement, he says he wants “to give something back to society – a little knowledge the public should find useful.”

Mr. Wozny, whose company, Site Economics, has done the financial analysis and strategy for more than $120-billion worth of large-scale residential towers, shopping malls, suburban subdivisions and industrial parks, says he’s analyzed the financial feasibility of projects for all the major developers in Western Canada and the three levels of government.

He’s seen unprecedented financial windfalls in the Lower Mainland’s real estate market. Now Mr. Wozny wants to speak out on behalf of the losers: those residents who rely on their incomes to afford them a place in the property market, be it owning or renting.

He’s studied the situation and has come to several conclusions: that more supply is nothing but fuel for the unaffordability crisis; that house values that are wildly disproportionate to incomes indicate a high level of tax evasion; that government is failing to institute fair tax regulation to ensure infrastructure needs are met; and that all this “growth” is simply not paying for itself.

The result is that a basic necessity – housing – has become a low-risk profit-making tool.

“What would we think of someone who hoarded food? Why is real estate any different?” asks Mr. Wozny. Analyzing data from the Real Estate Board of Greater Vancouver and the Canada Revenue Agency, he found an odd inverse relationship between incomes and housing; the higher the house price, the lower the declared income; the lower the house price, the higher the income. In Vancouver, Richmond, West Vancouver and Burnaby, houses are routinely priced between $1.5-million and $3-million. However, taxpayers report “unusually low taxable median family incomes, well below the regional average.”

Richmond and Vancouver, says his report, are among the highest income-to-house price ratios in the world.

Meanwhile, in Port Moody, Coquitlam, Port Coquitlam, Langley and Maple Ridge, house prices are well below the regional average and reported incomes well above.

If tax returns are a guide, the suburbs are now the high-income earning areas of the region shouldering the greatest tax burden. Those closest to the central core appear to be scraping by with little income, despite their high-cost housing.

The only conclusion to reach is that incomes are not being reported, says Mr. Wozny. A segment of the population is effectively subsidizing a group that refuses to pay its taxes.

He makes the case that a home’s value is due almost entirely to its location within the city. It may provide shelter, but it is the roads and sidewalks, proximity to schools and amenities that determines its worth. The city, and public infrastructure, creates its value. But what of the buyers who capitalize on that value without putting anything back in?

“Over the past 30 years, private residential real estate has become more of an economic ‘free rider,’ enjoying speculative, low-risk increases in value generated by public investment, but avoiding making adequate contributions to the public realm which supports it,” he writes.

Because the majority of our infrastructure was built before 1990, we are continually drawing on that value with massive new developments. Government should be tapping the “vast fortunes being made in real estate” to ensure equal access to public infrastructure,” he says, echoing Mr. Hudson’s argument for far heftier taxes on speculative buying.

“The growth has not paid for itself. Much of the infrastructure is relatively dated and paid for by a generation that was far more generous, and we are drawing down on that, compromising the quality of life without growing the infrastructure. We are creating congestion, whether it’s traffic, or at the hospitals or universities, whatever. There is plenty of money in private growth, so the growth should at least pay for itself. Why should government and the people in the middle foot the bill?

“Somebody doesn’t spend $4-million on your house alone. It’s the region they are buying, not the house. It’s the community that makes it special. It wouldn’t be worth anything if the community were to decay. That’s what we don’t understand.

“Obviously something terrible is happening – the money flooding in is not a sign of a healthy functioning capitalist market.

“The only group at fault are politicians who want growth without having to pay the requisite cost.”

Another group might also be at fault: the general population.

Mr. Wilkinson, whose film will screen in Vancouver at Simon Fraser University on May 6, says a challenge he faced during the filmmaking was the general apathy of average people. He edited down discussion about big inflows of foreign money and corruption because the topic got the thumbs down from a mixed-demographic group he uses for feedback.

“Audiences don’t relate to it, they don’t get it,” says Mr. Wilkinson. “We had a bunch of stuff about corruption and money laundering and people kept saying, ‘I don’t get it. How does money laundering work?’

“Where we struggle with it is that people will often say, ‘So what? That’s just free money into our system, and money is good, right? Who cares if [buyers] are from another country or whoever comes here with $1-billion. It trickles down, right?’

“But they can’t get it in without breaking the law, which affects you,” Mr. Wilkinson says. “And there are people who say, ‘I don’t care if my community is disintegrating. I want to retire in Hawaii with an RV.’ I get that there are people like that and they are making a conscious choice.

“That’s the key focus of the show, for me, is the sense of community that I’ve always felt in Vancouver, and I see it’s under such assault.

“It’s been very frustrating.”

Instead of steering the viewer toward any conclusion, Mr. Wilkinson presents the facts of Vancouver’s affordability crisis in such a way that people can make up their own minds, according to their values. He includes interviews with David Suzuki, Bob Rennie, Raymond Wong, Seth Klein and Sandy Garossino, who is quoted saying: “We manufacture and export condominiums.”

Mr. Wilkinson became something of a media magnet when promoting the film in Toronto recently, because Toronto has entered the speculative frenzy that Vancouver has endured for years.

Toronto, he says, is even more vulnerable than Vancouver, because of its rich history of diverse ethnic communities. They will be crushed under the weight of gentrification, much the way Vancouver is losing its Chinatown.

B.C.’s economy, says Mr. Wilkinson, relies on the selling off of real estate instead of actual jobs, as a result of government inaction.

“It’s reached the point where we don’t have much to sell, other than the land itself. So when the Premier crows about how she’s created all these jobs, in a bizarre and macabre way, she has – by failing to impose any restriction on the real estate market. And of course it’s unsustainable, because there are no jobs anywhere else. When you drive past all these communities in northern B.C., everything is boarded up. Resources are simply gone.

“Jobs here are building speculative housing units.”

He wonders where this selling off of real estate to the highest bidder will eventually get us. Every time a home is sold for millions of dollars to a speculator, that home is likely forever lost to the local income-earner.

“Let’s assume everybody sells out and gets rich. What’s the plan – to build another city? But where am I going to go? This is my home,” Mr. Wilkinson says.

“I don’t feel the government really cares much about my interests, or anybody else I know, so everybody devolves into, ‘every man for himself.’ And that’s the antithesis of community.

“We’re Canadian. We weren’t supposed to be like this.”

– from ‘Housing talk gets louder and angrier in Vancouver’, Kerry Gold, G&M, 28 Apr 2017 [Whole article copied here, for the record. Hat-tip to The Auteur]

Strong feelings about RE are becoming more and more mainstream.
The ‘Anger’ factor is noteworthy. Extreme wealth inequality breeds anger. This is very, very bad for a society.
The mention of the ‘general population’ as a causative factor is good.
And don’t forget the banks allowing leverage with their mortgages, creating money from nowhere, fueling the speculation. Who needs to import money when you can create it from nowhere?
– vreaa

‘Poor’ Parenting – B.C. Liberal Housing Minister Rich Coleman – “My advice to my teens, start saving for the down payment.”

Mon, 24 Apr 2017 14:18:50 GMT

Under the B.C. Liberals, who are actually quite conservative, the gap between the super-rich and the rest of us has become a yawning chasm. For most, it has become harder to make ends meet. This demands fundamental change, not a softer tone. …

… B.C. Liberal Housing Minister Rich Coleman is laissez-faire about it: “My advice to my teens, start saving for the down payment. That is your future if you can build up that equity.”
With million-dollar homes, stagnant or declining wages and big student loans – good luck, kids.

Last week, Premier Christy Clark built on this train of thought at the leaders’ debate. “You know what you need to be able to afford a house? You need a job,” she said. Yet, unemployment is up everywhere but the Lower Mainland and Vancouver Island.

– from ‘Anger Brewing in unaffordable BC’, Garth Mullins, 24 hrs Vancouver, 23 April 2017 (with quote augmented based on Frances Bula tweet)

Meanwhile, who would benefit from the fruits of all that hard work?….

From Jan 2016:

Surging real estate values added $2.3 million to B.C. cabinet ministers’ personal wealth this year alone, as the government says coming measures to ease housing affordability won’t include any that lower prices.

One minister saw her four properties jump $765,000, more than five times a minister’s salary. Another saw gains on a portfolio of eight homes. On average, ministers made $103,000 – more than an MLA’s salary, according to a review of public records by CTV News.

It’s natural for those ministers to welcome their own wealth boost, but they have to realize how their eye-popping gains translate into tremendous hardship for young people trying to get into the notorious Vancouver property market, said UBC professor Paul Kershaw.

“We can’t start with the presumption that housing price increases are a good thing. Housing prices that have outpaced incomes is remarkably bad news. It’s turned Vancouver into a generational ghost town,” Kershaw said, referring to how hard it is for young people to buy in neighbourhoods where they grew up.

– from ‘Surging real estate makes $2.3M for B.C. cabinet as affordability worsens’, Jon Woodward, CTV Vancouver, 25 Jan 2016

Goya’s ‘Saturn Devouring His Son’ (1819-1823):

The Value Of The Dirt? – “In condo crazy Vancouver, downtown’s last gas station for sale”

Sat, 15 Apr 2017 15:35:31 GMT

“If you look at the value of the dirt, there’s just no possible way that just having a stand-alone gas station makes any kind of sense financially,” Tsur Somerville, director of the University of British Columbia’s Centre for Urban Economics and Real Estate, told CTV Vancouver.

Downtown Vancouver’s second last gas station was recently sold to a development company for a staggering $72 million. That sale prompted the owners of Downtown Vancouver’s last gas station, an Esso located at the intersection of Burrard and Davie Street, to put their property on the market too.

And while that may be good news for condominium developers, Stephen Regan, executive director of the West End Business Improvement Association, says that selling the station will come with consequences.

“Losing a gas station, and possible the last gas station in downtown, is going to have some significant impacts, I think, for locals and for visitors,” he said.

– from ‘In condo crazy Vancouver, downtown’s last gas station for sale’, CTV, 14 April 2017

The fact of the last fuel station in downtown Vancouver, here for the record.
BTW: If we were to make all decisions about what’s important in Vancouver based on the “value of the dirt”, where would that lead?
If we were to make all decisions about what we do with our lives based on maximizing income per time unit, where would that lead?
In a related sense, how does one measure success?
– vreaa

Spot The Speculator – “I can’t imagine a bubble bursting where over six months you see a decrease of 30 or 40 percent”

Sat, 08 Apr 2017 14:12:10 GMT

“Living in cramped spaces is everyday life for many families. Because of the high cost of housing, many have to make do with whatever they can afford.
In Vancouver, city staff estimated that more than 8,000 families with at least one parent and a child were living in a studio or a one-bedroom apartment in 2011.

Ryan Chahl, a 29-year-old entrepreneur, is thinking about settling down. He wants to provide adequate housing for his future family.
“I’m kind of looking for a home that could potentially support a family,” Chahl told the Georgia Straight in a phone interview.
That means a three-bedroom house “with some room to grow”.
“I’m trying to plan for the future and think ahead,” Chahl said.

For now, his plan doesn’t include selling the Port Moody condo he bought four years ago. “It’s an asset that I can grow equity in,” he said about the two-bedroom property where he lives on his own, and which he intends to rent out eventually.
He used to live with his parents before he purchased his apartment with a five-percent down payment.

Chahl’s challenge is how to secure a new mortgage.
Aimal Pamir, who was his mortgage broker for his condo purchase, has advised him that because he is self-employed, it’s not going to be easy.
According to the Real Estate Board of Greater Vancouver, the federal Office of the Superintendent of Financial Institutions requires from individuals working for themselves a minimum down payment of 35 percent of the purchase price to qualify for a loan.

In 2016, Chahl set up his own consulting and project-management firm. Chahl related that his business is doing well, giving him the confidence to approach a major bank for a mortgage.
“It’s kind of been the vehicle for me to start making those heavy savings that are required to be able to buy a home in Vancouver or near Vancouver, at least,” he said.
Getting the bank to approve a mortgage will likely take a bit of time.
Like the more than 400,000 self-employed people in B.C., Chahl has to prove that his business is viable. According to him, banks typically require three years’ proof of income. If he wants to make a purchase in six months to a year, he said that he may have to produce a 50-percent down payment.

Chahl holds a business-administration degree from SFU. For him, the housing market isn’t just a game in which he wants to make a quick buck.
“It’s something that I’m investing in, going in long-term with the kind of goal of seeing those assets appreciate long-term, not kind of flip them in a year or two,” he said.
Chahl expects home prices to gradually decline, which is generally in line with the latest projections by the Canadian Real Estate Association (CREA). According to the CREA forecast issued on March 15, home prices in B.C. will shrink by more than five percent in 2017.

Chahl is not worried that the property market has risen so fast that it can only head for a crash. In September last year, Swiss bank UBS reported that Vancouver is number one on its global list of cities with the highest bubble risk.
“Over the next year, maybe two, you’re going to see a decrease in prices, but I can’t imagine…a bubble bursting where over six months you see a decrease of 30 or 40 percent,” he said.

As in his first purchase, his realtor and older brother, Adam Chahl, is around to help him acquire a second property. “Adam, being who he is, I have absolutely no issues trusting him,” he said.
Chahl said he’s happy with the way things are going for him.
His long-time girlfriend lives in a neighbouring city 10 minutes away from his condo. There are lots of trails nearby where they can hike and walk her three dogs.
Chahl can see the two of them growing a family together in the future: “That’s the plan.”

– image and entire article from ‘Home search: Millennial in the market to buy second property’, Carlito Pablo, Georgia Straight, April 5th, 2017

—-

For 10 years or more, the vast majority of Vancouver RE sales have been at least partly based on the belief that there would be ongoing outsized price gains.
The buyer above is convincing himself that he’s an investor, and that he’s purchasing for his own future sensible use, but actually he’s speculating.
He’s assuming there may be modest price decreases in the short term and then.. off to the races again. Why else buy two properties?
It’s interesting to hear him state the possible risks but then dismiss them.
The family RE professional is another bubble feature.
Buying even vaguely near the top of a bubble can take thirty years or more from which to recover, in real terms.
Perhaps this guy will be lucky and fortuitously-timed price drops will cause him to reconsider.
Timing can be… tricky. Luck helps.

PS: Yeah, we know the standard response: “But, he just needs a place for him and his family to live!” — That’s the argument that has fueled this bubble all this while: Locals overextending themselves into mortgages which in rational times would be seen as preposterously & laughably oversized, pushing prices higher and higher in doing so, completely unsupported by any real economic fundamentals, all the while convincing themselves they are prudent citizens motivated by wholesome values. If and when you take the expected unrealistic price gains out of this equation, there will be fresh air under this market.

– vreaa

Leverage Turns Bad – ‘Vancouver homebuyers lost almost 50 per cent on their down payments in 1 year’ – Global News

Wed, 29 Mar 2017 03:53:21 GMT

“Once considered Canada’s hottest locale for real estate, home values in Vancouver took a beating over the course of a year, with the average home price dropping from over $1.1 million in February 2016 to $995,583 a year later. …
Zoocasa calculated the loss (or gain) of return by taking the year-over-year change in average home prices and then dividing it by the down payment buyers would have had to make in February 2016.
By this measure, Vancouverites lost 49 per cent of the return on their down payments.”
– excerpt and image from ‘Vancouver homebuyers lost almost 50 per cent on their down payments in 1 year’, Jesse Ferreras, Global News, 28 March 2017

Yeah, it’s called ‘leverage’ – bliss on the way up, a real bummer on the way down.
Along with other factors such as no capital taxes on primary residences, it’s why RE speculating has, superficially, seemed like such a no-brainer in Vancouver for the last 17 years.
But it is on the descent where the piper gets paid… the ‘virtuous’ cycle turns ‘vicious’.
It’s noteworthy that the downside of leverage is now getting headline news.
At the time of posting, the only comment on the Global site was from a realtor complaining that the article was too negative, and suggesting that it’d be preposterous to suggest that there was high risk in RE. If this market crashes the way it very well could, many are going to be surprised. If a 10% swoon costs you 50% of your ‘investment’, what will a 30% drop cost you? Or a 50% drop? Not pretty.
– vreaa

‘Game Changer’ BC Court Ruling Extends Capital Gains Tax Risk To Buyers And Realtors

Sun, 26 Mar 2017 17:37:30 GMT

A B.C. Supreme Court ruling will send shock waves through the arm of the Canadian real-estate market that is powered by foreign capital, say immigration lawyers.
The ruling targets a weakness in Canadian laws that often leads foreign owners of real estate in cites such as Metro Vancouver and Toronto to claim they are “residents of Canada for tax purposes” when they are not.

The landmark B.C. decision requires notary public Tony Liu to pay his client more than $600,000 because Liu failed to adequately determine whether the Vancouver house his client was buying for $5.5 million had been owned by a tax resident of Canada.
As a result, the Canada Revenue Agency did not get paid, at the time of the sale, the 25 per cent capital gains tax it charges non-resident sellers of Canadian property on any profit they make on the sale.
So the CRA later demanded the buyer pay the $600,000 in tax. The buyer, in turn, sued Liu, arguing Liu failed to discover the seller was not a tax resident of Canada.

The CRA considers people who don’t live in the country at least six months a year and don’t pay income taxes here to be foreign property investors and speculators and thus subject to capital gains taxes.
Three Canadian immigration lawyers said the CRA tax-residency rule is often not enforced, even in over-heated housing markets in Vancouver and Toronto that are in part fuelled by offshore money.

The complex ruling published this month by B.C. Supreme Court Justice Kenneth Affleck strikes to the heart of a gaping hole in Canadian tax, immigration and property-transfer law, say the immigration lawyers.
The B.C. decision is a stark warning to real estate agents, notaries and lawyers who fail to ensure that sellers of properties are truly tax residents of Canada, said David Lesperance, a tax and immigration lawyer based in Toronto.
“This truly is a game changer,” said Vancouver immigration lawyer Richard Kurland.
“It’s a precedent. Real estate agents can now get a knock on the door from the taxman, asking for the (capital gains) taxes that should have been collected by Ottawa, because the agent failed to make adequate inquiries.”

Sam Hyman, a Vancouver immigration lawyer, said the judge’s decision alerts purchasers to “the dire consequences” of making offers on properties sold by people who may be trying to avoid capital gains tax by falsely declaring they are tax residents of Canada.
Many buyers and their agents, Hyman said, are not being diligent in making sure the seller is a physical or tax resident of Canada, while others are being “cavalier” or “engaging in wilful blindness” about it.

– from ‘House buyer beware: Landmark B.C. court ruling will shake real-estate industry’, Douglas Todd, Vancouver Sun, 25 March 2017

Crucial Question: Will People Be As Eager To Buy Homes If Prices Are Flat Or Dropping?

Wed, 15 Feb 2017 16:20:44 GMT

The average price of a Canadian home sold in January was $470,253, just 0.2 per cent more than the same month a year earlier.
The Canadian Real Estate Association reported Wednesday that sales were down by 1.3 per cent during the month, to the second-lowest monthly level since the fall of 2015.
New government rules designed to crack down on speculation in the mortgage market came into effect in October and January’s numbers suggest they appear to be working.
“Canadian homebuyers face some challenges this year, including new mortgage rules that make it harder to qualify for a mortgage and regulatory changes that will push up mortgage financing costs,” CREA president Cliff Iverson said in a release.
“It will take some time to gauge the extent to which these challenges will weigh on home buyers in different housing markets across Canada.”
– ‘Average Canadian house price barely increased in past 12 months’, CBC 15 Feb 2017

Longtime (and long-suffering) readers will recall that our premise has always been that, in markets such as Vancouver, people have overextended themselves to buy homes at prices far above fundamental value because they anticipate ongoing outsized future price increases. This is why we have called all buyers ‘speculators’. A significant price stall or pullback will test this hypothesis. Will buyers still be eager to overextend with the prospect of ‘barely increasing’ prices in future?
Speculators are almost all momentum buyers; they hate assets that are falling in price.
– vreaa

A Real Estate Economy – “Real estate inflation in the Lower Mainland in 2016 is greater than the entire provincial GDP — the actual goods and services produced by all British Columbians”

Thu, 02 Feb 2017 06:50:30 GMT

Whether we like it or not, B.C. has basically become a real estate economy. The BC Assessment office recently released numbers for 2017 showing that property values ballooned by a staggering $332 billion — 25 per cent — last year. This figure is more than five times the economic value of all goods-producing industries in 2015 combined and nearly double the size of our entire service sector that same year.
Not surprisingly, 90 per cent of the increased values from last year’s property gold rush were in the urban land bubble in the Lower Mainland, which increased by $298 billion in 2016. Real estate inflation within this tiny area, representing just two per cent of B.C.’s land area, eclipsed the entire provincial GDP — the actual goods and services produced by all British Columbians in 2015.
But is this real estate wealth actually real?
– excerpt and image from ‘We’ve Let Vancouver Become a Playground for Plutocrats’, Mitchell Anderson, The Tyee, 31 Jan 2017

No commentary required. – vreaa

Eight of the Top Ten Donors to the BC Liberal Party are RE Industries

Wed, 18 Jan 2017 16:18:17 GMT

– from The Vancouver Sun, 17 Jan 2017

This requires no commentary. – vreaa

CTV Headline: ‘All hell is going to break loose in Vancouver’: Ex-trader’s real estate forecast

Sun, 01 Jan 2017 01:44:10 GMT

“A man who made millions as a short seller on Wall Street by betting against the odds has turned his sights from the U.S. economy to Vancouver real estate.
Former trader Marc Cohodes spent decades betting against housing “bubbles” before they burst. Now he has his eye, and his money, on the local housing market, and he has a warning to homeowners and first-time buyers.
“It’s going to blow to complete and utter smithereens,” Cohodes predicts.
“I think the market probably topped in the spring of ’16 and I think all hell is going to break loose in Vancouver in 2017.”
Cohodes is so confident in his prediction that he’s betting against one of Canada’s biggest alternative mortgage lenders, forecasting a housing crash similar to the one south of the border in 2008.
“I witnessed some of the U.S. housing fiasco here, and I said to myself, if I ever see it again, I should speak out louder than I did,” he told CTV’s Sarah MacDonald.
So this time he’s speaking out, and his predictions are drastic.
Cohodes, who is now retired from trading, predicts that all of Metro Vancouver’s multimillion-dollar homes will see their value plummet by as much as 50 to 80 per cent.”
– CTV News, 30 Dec 2016

This happens regularly — Somebody from ‘the outside’, with knowledge of markets, takes a look at Vancouver RE and sees how much of a bubble it is… they rant about it for an article or two… then nothing proceeds to change. Robert Shiller called Vancouver the ‘bubbliest city’, what?.. 10 years ago? And we’ve regularly seen traders like Cohodes try to find ways to short our RE.
One of these days, one of these guys is going to get the timing right.
[Implied comment/joke about the challenges of timing markets intended].

RE matters aside, have a really good 2017, everybody. – vreaa

Vancouver Sun Headline: “Vancouver real estate prices face double-digit drop in 2017: LePage”

Fri, 23 Dec 2016 14:30:32 GMT

“The forecast for a double-digit price drop in Vancouver’s housing market makes for a nice or nasty surprise for 2017, depending on where you are on the property ladder, but experts say it still won’t make the city affordable.
Royal LePage CEO Phil Soper said prices are headed for double-digit decline in 2017 as buyers drop out of the market.
“Home prices had got so out of whack with the growth in underlying wages and salaries that there had to be a correction,” said Soper. “And it’ll happen in 2017.”
– ‘above the fold’ front page headline in The Vancouver Sun, 22 Dec 2016

A realtor citing fundamentals. Times are indeed changing. – vreaa

CTV Vancouver Uses ‘Prices Plunging’ In News Headline

Fri, 09 Dec 2016 14:42:33 GMT

Sober hosts

Listing prices for detached homes appear to be falling as Vancouver’s real estate market faces what an expert calls “significant headwinds.”
Data released Friday showed that those looking to buy a single family detached home in the city last month forked over about $1.5 million in Metro Vancouver, but recent listings suggest that the benchmark is falling.
CTV News found a number of East Vancouver homes priced under then $1 million mark during a search of MLS listings on Monday, including one that sold for $560,000 below the initial asking price.
That home, located in Renfrew Heights, was initially listed at $1.36 million in August, but sold for $800,000 in mid-November.
Sutton West Coast realtor David Hutchinson has been tracking plunging prices and found several detached homes listed below $1 million, some of which had been recently renovated.
“If you want to sell, you have to be priced sharply, and you see a lot of price drops,” Hutchinson told CTV.

– from ‘Prices plunging: Houses selling well below asking, some under $1M’, Penny Daflos, 5 Dec 2016

Sales have slowed and prices are beginning to soften. Fundamentals remain shockingly poor, and there are ‘headwinds’ like rising mortgage rates and financing restrictions. 2017 will tell whether this is the beginning of the crash we’ve expected for years. – vreaa

Young Canadians And Homes – “What happens if we all decide we can’t afford this shit?”

Mon, 28 Nov 2016 18:31:41 GMT

VICE: People often choose buying over renting because there is stability and community for family life. What changes when we stop buying houses?

Milevsky: We suddenly lose the stickiness of our labour force. It’s very important for Canada to have more than just high wages keeping us here. The last thing we want is to be a commodity labour market. What’s stopped us from doing that is the connections we’ve had to our community. If the younger generation sees housing as unaffordable and uninteresting they’re more likely to move internationally.
People may lose their anchor to a particular geographic location. I want my neighbourhood park to be clean and green and well maintained. If I just live their temporarily, do we lose our interest in the environment beyond our immediate needs? There’s also the transient nature of politicking. Who are your constituents if communities change?

Kershaw: If you opt out of home ownership, you opt out of the most secure opportunity for starting families and to have your kids in the same school, childcare, and community. Home ownership has also been a route to get access to the ground and playing outside. Renting in bigger cities is not having the kind of stock suitable for families. Big cities aren’t losing 20 somethings, it’s when the biological clock starts ticking you see a bit more of an exodus.
If renting is going to become a common practise for adults, systems such as childcare need to be improved. I’d like my child to be in the same childcare space for a few years. I don’t want to move around from neighbourhood to neighbourhood because I’m being evicted because my landlord can make more on other renters. We need to think about how renting can create that kind of security.

– from ‘What Happens if Young People Never Buy Homes?’, Samantha Power, Vice, November 27, 2016

Vancouver Home Buyers Will Require About 27% More Income To Qualify For Mortgage On Average Priced Home

Tue, 22 Nov 2016 05:31:50 GMT

Finance Minister Bill Morneau introduced tighter new mortgage regulations last month, requiring a “stress” test for borrowers of Canada’s most common mortgage, the five-year fixed-rate.
It requires borrowers to qualify for loans at the Bank of Canada’s posted rate, which is about two percentage points higher than current offered rates.
Of course, most people aren’t going to see a pay raise of 20 per cent or more this fall, so the likely outcome of the new mortgage rules will be a decline in home sales (something the Finance Department itself predicted) and slowing or declining house prices.
…
In Toronto, you’ll need nearly 25 per cent more income (an extra $29,000 or so) than before to afford an average house, while in Vancouver you’ll need 27 per cent more — an extra $33,000 in income.

– from Canadians Will Need 20% More Income To Buy That House They Wanted, Huffington Post, 21 Nov 2016

Fortunately, in Vancouver there is no relationship between income and housing prices. So this new rule is unlikely to have any effect. -ed.

Selling What’s Left of Our Soul – Vancouver Seeking More Corporate Labels

Fri, 18 Nov 2016 17:42:02 GMT

“Vancouver has launched a new initiative to develop an inventory of its assets – everything from buildings and cars to its awards programs and even its website – that could make good candidates for sponsorship and naming rights.
The Vancouver consultant is being asked to look at the policies in other cities and then “develop the criteria to identify all marketable components (i.e. programs and facilities) associated with those assets and determine the type of sponsorships that can be leveraged, such as naming rights for a facility.” In addition, it will need to explain why some assets are not appropriate for naming rights or sponsorships.
The final report is supposed to “provide the City with realistic revenue projections and return on investment based on various sponsorship/agreement terms (e.g. 5, 10, 15, 20 years)” and “suggest how the city can maximize the market value of these assets or potential revenues via targeted sponsorships and bundling.”

– from ‘Vancouver to develop list of assets eligible for sponsorship, naming rights’, Frances Bula, G&M, 18 Nov 2016

“I went to Berlin because it was a place where you could afford to have space and time, which was a tricky thing in Vancouver. Time to work on my art because I wasn’t on this insane anxiety of the financial pressure of the city.”

Fri, 04 Nov 2016 04:45:29 GMT

“Berlin and Vancouver are very, very different cities. Just culturally, it’s extremely different. I went to Berlin because I was making music and art consecutively and it was a place where you could afford to have space and time, which was a tricky thing in Vancouver, and continues to be a very tricky thing as an artist. So Berlin allowed me time, more than anything. Time to work on my art because I wasn’t on this insane anxiety of the financial pressure of the city. So, the working is different. In Berlin you have to be quite self-motivated, because you can easily just go down a hole and not work, because of the lack of pressure to pay your bills. I still love Vancouver deeply and it’s where I’m from, but at the moment Berlin is where I call home.”
– Artist Jeremy Shaw, winner of the 2016 Sobey Award, in interview with Canadian Art magazine 1 Nov 2016

Where Life Is Absurd, We Need Art – “Why I pranked Torontonians with fake condo signs”

Fri, 28 Oct 2016 13:26:28 GMT

It was a mock proposal so realistic that, for a moment, Toronto collectively gasped – was Old City Hall really being turned into a condo? The artists behind the stunt, self-identified ‘urban interventionists’ known only as Glo’erm and Tuggy, intended to spark outrage when they erected a fake public notice last week. They wanted people to be angry – so angry that they started caring about how this city is developing.

—

“In the real estate frenzy this city is experiencing, it feels like nothing is too sacred not to be considered for development. Our faux proposals featuring Toronto’s most beloved buildings address our concern that the development proposal process in this city is broken. How many of us are meaningfully included in the shaping of Toronto?”
– Daniel Rotsztain

– from The Globe and Mail, 27 Oct 2016

We’re Number One! – Vancouver RE ‘Overvalued Since 2007’ – UBS 2016 Housing Bubbles Report

Tue, 27 Sep 2016 16:42:45 GMT

Vancouver and London came first and second on the 2016 list of cities most at risk of real estate bubbles. Bubble risk was also evident in Stockholm, Sydney, Munich and Hong Kong: house prices in these six cities have increased by nearly 50% on average since 2011. The average price rise in other financial centers has been less than 15%.

Who is to blame for this latest global bubble? Why your friendly, local central banker of course.

As the WSJ summarizes, loose monetary policy at global central banks is a key driver behind rising prices, the report claims. Low interest rates have pushed investors to hunt for returns in tangible assets, “so it is hardly any wonder that housing markets are again overheating,” according to report authors Claudio Saputelli and Matthias Holzhey. …

Meanwhile, Vancouver house prices have been significantly overvalued since 2007, according to UBS. The culprit there is not so much the BOC as the PBOC: until recently Vancouver served as the primary offshore target for Chinese money launderers, which neither the financial crisis nor weakening commodity prices managed to dent. However, this bubble now appears to have finally burst after the provincial government of British Columbia introduced a 15% transfer tax on foreign home buyers in August, leading to a crash in the most expensive local housing segments.

– from Zerohedge, 27 Sep 2016

Vancouver RE, ‘Overvalued since 2007’. Care of weak monetary policy, and strong local narrative. – vreaa

Vancouver’s Housing Market Not Crashing, Just Frozen, Says Realtor

Mon, 12 Sep 2016 15:23:28 GMT

“We need to recognize that living in a great place may just be more expensive than some people want it to be.” [6:30]
For this and lots of similar material, watch the Video from BNN 12 Sept 2016

The headline reminds us of Stevie Smith’s ‘Not Waving but Drowning‘. -vreaa

“You Have No Idea How Angry I Am” – “A generation of people has been screwed. It’s so obvious. Everyone I work with is so angry. A select group of people have profited from this”; “I am very angry at the system.”

Sat, 10 Sep 2016 17:24:09 GMT

“A Vancouver accountant told The Globe that she and her colleagues see questionable real-estate transactions all the time, which they believe have contributed to skyrocketing prices. “This has become a huge mess. You have no idea how angry I am,” says Corina Ciortan. “A generation of people has been screwed. It’s so obvious. Everyone I work with is so angry because there is a select group of people who have profited from this.”

One of the Vancouver homes Mr. Gu flipped sat vacant for three years, in a city where many people can’t find a place to live.

Ottawa says it is studying the issue, and B.C. has brought in a tax on foreigners who buy residential real estate in Vancouver. But those who see firsthand how real estate is traded like stocks and bonds say this isn’t nearly enough. “We have governments that are not doing their job,” argues Mr. Lazos, who acquired his inside knowledge while working for Jun Gang Gu, also known as Kenny Gu, a former civil servant originally from Nanjing, near Shanghai.
Mr. Gu came to Canada in 2009 under Ottawa’s now-defunct immigrant-investor program, which gave permanent residency to applicants who agreed to lend a significant amount of money to the federal government. He started out here as a developer, but the documents show that his business evolved to buying homes – using other people’s money– and then flipping them. His deals are financed with investor money from China and mortgages issued to those investors by Canadian banks.
—
In addition to holes in the tax system, speculators like Mr. Gu also rely heavily on Canadian financial institutions to give their clients multimillion-dollar loans. “They are using this money temporarily – to make more money – instead of using their own money,” Mr. Lazos says. “Then prices go up. We are making the bank richer and the Canadians poorer.”
—
Mr. Lazos says that his whistle-blowing will be worth it only if it jolts Ottawa and B.C. into action. And his reasons, at least in part, lie close to home: “I hate the fact that for my daughter and my grandchildren, there is no way they can own a house in this city.”

– from ‘Out of the Shadows’, Kathy Tomlinson, G&M, 10 Sep 2016

Average Vancouver Detached Price Loses Last 12 Months’ Worth of Gains In One Month.

Wed, 07 Sep 2016 04:57:38 GMT

“As was largely expected, the first official data since the bursting of the Vancouver housing bubble following the 15% luxury real estate tax, was ugly: on one hand, the number of Vancouver home sales fell 26% from a year earlier, and tumbled by 23% comparted to July, to
2,489 transactions. Detached properties were hit hardest as sales dropped 45% from a year earlier. Transactions of attached homes such as town-houses dipped 25% and apartment sales were down 10%. On the other, prices likewise slumped, with the average price of detached Vancouver properties crashing 17% in just one month, and already down 0.6% on the year, to C$1.47 million in August, the lowest price since September 2015.

What is worse, is that what was until now a mostly regional housing bubble, is starting to spread in the form of a hit to Canadian consumer confidence. As Bloomberg reports, “a shifting real estate market in Vancouver led Canada’s consumer confidence index lower for a second week.” According to the BBG Nanos telephone poll shows, the share of respondents who see local real estate prices falling has almost doubled in the last two weeks, rising to 22.5% in the latest survey, up from previous readings of 20.5% and 12%. Conversely, the share of those who see higher prices fell to below 40 percent for the first time since April.”

– from ‘Vancouver Housing Bubble Burst Sends Local Consumer Sentiment Crashing Most In Three Years’, Zerohedge, 6 Sept 2016

Zerohedge: “Vancouver Housing Market Implodes”; “Devastated”; “Slammed Shut”; “About To Get Very Ugly”

Fri, 19 Aug 2016 15:56:27 GMT

“Three weeks ago, when we looked at the long-overdue sudden change in the Vancouver housing market, long a receptacle for Chinese hot and laundered money, we found that as a result of the implementation of the 15% property tax implemented by British Columbia (something we recommended over a month earlier), that the Vancouver housing bubble has burst.

We concluded this based on anecdotal evidence by local real estate professionals: “As a new dawn breaks in Metro Vancouver’s real estate market, realty companies and real estate boards are reporting the first anecdotes of deals falling through as foreign buyers forfeited deposits on binding deals rather than pay the new tax. Worse, if only for the unprecedented local housing bubble, and certainly better for potential local homeowners who were locked out from the massively overpriced market, they report evidence of local buyers withdrawing offers in expectation that the market will soften.”

Less than a month later, there is also hard evidence to confirm this assessment. According to Global News, evidence from realtors and MLS data is showing the Vancouver real estate market is in the midst of a major slow down, with prices dropping and sales plummeting.

While August is typically one of the slowest months for real estate transactions, MLS sales data from the first two weeks of the month shows what many have been hoping for during the last few years of escalating prices. According to realtor Brent Eilers, using MLS listing data, there were only three home sales in West Vancouver between Aug. 1 and 14 this year, compared to 52 during the same period last year. That’s a decrease of 94%.”

Global News obtained MLS sales data from several key Metro Vancouver markets and found the number of homes sold during the first two weeks of August in Greater Vancouver dropped by 85% on average. Richmond experienced a 96% drop in the number of sales and Burnaby North fell by 95%. Vancouver’s West Side, West Vancouver, and Coquitlam also took major hits.

It appears that the Vancouver housing market has slammed shut.

Which is hardly a surprise: virtually everyone saw it coming, the only question was when. Eilers says he’s been warning of a real estate slow-down for at least a year due to the region’s unsustainable and unsupportable prices. West Vancouver, where he does a large part of his business, had a benchmark detached home price of almost $3.4 million in July according to the Real Estate Board of Greater Vancouver.

“The market in West Van is up 450 per cent since 2001. So is everyone making 600 per cent more income than they were so they can pay their taxes and buy their houses? Of course not. So how is this inflation been financed? By off-shore money and record debt.” Precisely what we said at the start of the year when we first heard horror stories about Chinese buyers paying cash, sight unseen, for any and every local luxury, and not so luxury home.

It appears that it is not just the 15% luxury tax implemented on on July 25 that has burst the bubble: according to Eilers sales were dropping even before the tax. According to the data, July was another slow month in West Vancouver with only 44 sales, down from 80 in 2015. June saw 74 sales, also down from 102 the year before.

The pattern has left the market “devastated”, Eilers adds.

While it may be too early to make a definitive conclusion, after all while earlier this month, the REBGV released its statistics for the month of July, saying the data showed the market had slowed down to “normal levels”, there was still no official August data available, and thus no actual indication of the slowdown. Fortunately for buyers, real-time data proves otherwise.

Zolo, a Canadian real estate brokerage, keeps track of MLS home sales in real-time and reports prices as an average rather than the “benchmark price” used by the REBGV. It currently shows a major correction underway in most Metro Vancouver markets. According to the website, the City of Vancouver currently has an average home price of $1.1 million, down 20.7% over the last 28 days and down 24.5% over the last three months. The average detached home is $2.6 million, down 7% compared to three months ago.

If the bubble has indeed burst, things are about to get very ugly. Eilers says that in the 1980 housing crash, prices dropped by 40 to 60% within a year and took six years to recover. “So your $2 million house became $800,000 in five months. There’s a lot of economists and a lot of wise people that believe that our financial structure is much closer to that structure from a corrections’ point of view,” Eilers explained.

One thing, however, appears certain: the foreign money influx has stopped. Zolo’s CEO says the foreign buyer tax has certainly stopped speculative buyers. This has caused many other buyers to take on a “wait and see” approach, which has essentially frozen the market.

News of the foreign buyer tax has spread to China, where Chinese real estate website Juwai now promotes other Canadian cities as foreign capital destinations. The website used to promote Vancouver as one of the best places for wealthy Chinese to invest, but has now switched to publicizing Calgary and Alberta due to the tax.

Which means that while one bubble is bursting, another is about to start, even if it is smack in the middle of Canada’s bleeding oil patch.

That said, this is good news for ordinary Vancouver residents. NDP MLA David Eby says the tax has caused a lot of people to hit the pause button on buying homes, but all those people might come back into the market in September. Despite his reservations on how the tax was implemented – he would have preferred an incrementally-increasing tax – he says a market slow down is good news.

“A lot of people have said to me quietly that they hope there is a substantial housing crash.”

Well, it appears they got what they wanted. Now the only question is what happens once Vancouver “corrects” by 30%, 40% or more – will the Chinese buyers stay away permanently or, like a good S&P500 algos, simply BTFD. We will have the answer in a few months.

– from Vancouver Housing Market Implodes: Average Home Price Plunges 20% In 1 Month – “The Market Is Devastated”, Zerohedge, 19 Aug 2016

As the article says: “If the bubble has indeed burst, things are about to get very ugly.” – vreaa

15% Tax on Foreign Buyers – Enough to Change the Narrative?

Fri, 05 Aug 2016 17:04:47 GMT

The important thing is not the direct effects of the tax itself, it is the effect that this may have on the story that locals are telling themselves about Vancouver RE.

From what I informally overhear, many people are talking about the effects of this tax.
If enough people believe that this will lead to dropping prices, drops will occur.
Local owners intending to sell will hurry to realize paper gains; Local prospective buyers will evaporate (see Spot the Speculator).

Speculators abhor falling prices.
Momentum speculators (off-shore and local) will withdraw.
Locals intending to buy far, far above wage or rent determined fundamental values will stay away if they can no longer be ‘certain’ of future price gains.

A market like Vancouver RE circa 2016 (25% gains in the last year!!) is dependent on ever rising prices to suck in new buyers.
Once it is seen, or believed, that Vancouver RE prices can drop substantially, at what level will prices stop falling?
[50% of uber-astronomically-overvalued is still substantially over-priced.]

– vreaa

Analyst on Global – “Sheer insanity…You’re pricing local, hardworking people out of the market… It’s fueled by a money laundering bubble that politicians, in cahoots with the real estate industry, don’t want to end.”

Wed, 06 Jul 2016 13:55:05 GMT

Speaking on Global BC News Morning, Cohodes made it clear that he has no personal stake in the Vancouver real estate market.
Cohodes said he wants to speak out about the housing market in Vancouver because he feels strongly “people are being taken advantage of.”
…
The Greater Vancouver real estate board says the benchmark price of a detached home in Vancouver hit $1.56 million in June, which is up 38.7 per cent in one year.
“I think it’s a money laundering-induced market,” said Cohodes. “Where the local politicians, or the BC Liberals, are kept or in cahoots with the real estate brokers, developers, lawyers, that angle. And they have sought Chinese money to keep the market propped up and it won’t last.”
“China has capital controls on and Vancouver has become the money laundering mecca of either the world or North America and something is going to change and change drastically.”
Cohodes said if the provincial government doesn’t step in to change the market, they’re going to be voted out.
“This is sheer insanity,” he said. “What’s going on is you’re pricing local, hardworking people out of the market and as I’ve said before, the housing market in Vancouver resembles the Vancouver stock exchange and penny stocks many years ago and that didn’t end well at all.”
Finance Minister Mike de Jong has said he does not believe Vancouver is in a real estate bubble, to which Cohodes said “he’s full of more crap than a Christmas turkey.”
“The market is ridiculously high and Christy Clark goes and takes real estate people over to China.”
“They have the records,” said Cohodes,” they just don’t want people to really know or they don’t want people to know the truth.”
In a statement to Global News, de Jong said:
We continue to work with both local governments and the federal government to address issues in Vancouver’s real estate sector, particularly to help bring new supply of homes to the market at affordable prices, and acting on concerns about regulation and enforcement. The premier announced last week that the province will end self-regulation of the real estate industry, and further steps aimed at helping make homes more affordable for the middle class will follow in the near future.
Cohodes said he has solutions to fix what the “issues are” but B.C. politicians don’t want to “take the medicine because their livelihoods depend on this.”
According to Cohodes, people who buy in this market will only become “debt servants for the rest of their lives.” He said when Vancouver’s market does tank or collapse, people are going to lose a generation of savings and equity.
“It’s fueled by a money laundering bubble that politicians don’t want to end.”
“At some point, bubbles burst.”
– from ‘Vancouver’s real estate is ‘fuelled by a money laundering bubble’: Market analyst’, Amy Judd, Global News, 5 July 2016

Trudeau States The Paradox: “The inflated housing market must be stabilized, but any action must not completely devalue those people whose retirements and equity are tied to their homes.”

Sun, 19 Jun 2016 20:51:56 GMT

Prime Minister Justin Trudeau says his government is concerned about the ballooning cost of housing in Vancouver and Toronto but it wants to be certain any action it takes doesn’t make the problem worse.

Speaking Friday morning on CBC Radio in Vancouver, Trudeau said any solutions will require collaboration between all levels of government, as well as academics and stakeholders.

He said overseas money is playing a role in fuelling superheated markets such as Vancouver, where the average price of a single-family detached home is $1.5 million.

But Trudeau cautioned that any federal measures to cap soaring house prices could backfire elsewhere in the country.

He said officials are examining Australia’s decision to tax homes owned by foreigners, but warns federal levers to curb offshore ownership in Vancouver or Toronto have the potential to harm other regions of the country where overseas investment can be beneficial.

Trudeau was scheduled to attend several events in Vancouver on Friday, including a roundtable on housing affordability attended by industry experts and several Metro Vancouver Liberal members of Parliament.

“How do we make sure we are helping people (in Vancouver) in exactly the right and targeted way,” Trudeau said. “That is where the kind of collaboration we haven’t had for 10 years between the federal government and different orders of government is so important to work on together.”

Most Vancouver homeowners know the inflated housing market must be stabilized, because the current trajectory “doesn’t have any good outcomes,” he added.

But any action must not completely devalue those people whose retirements and equity are tied to their homes, he said.

“We just have to make sure we are keeping people protected in how we stabilize it.”

– from ‘Trudeau warns housing solution in Vancouver could hurt markets elsewhere’, Vancouver Sun, June 17, 2016

It’s going to be interesting watching Trudeau and his surrogates try to land a B52 on a sail-boat.
In a Bubble, it is beyond the powers of government to orchestrate either ‘stability’, or a ‘soft landing’. -ed.

Question: “Why should a condo in Vancouver cost more than a condo in Toronto (or any other big city in Canada)?”

Sat, 18 Jun 2016 14:25:18 GMT

Correct Answer: “No good reason.” (full marks plus bonus)

Alternative Answer: “It’s a Bubble, Stupid.” (full marks, but no bonus due to unnecessary impoliteness)

Incorrect Answers: “Supply and Demand”, “Everybody Wants One (or two or three)”, “The Views”, “Only Insiders Will Be Able To Live Here”, “Because Downsizers Are Richer Here”, “We Are Running Out Of… Fresh Air?”

Points Further Deducted For Any Answer Qualified With: “Last Year I Made More Money In RE Than In My Last 20 Years Working As A (xyz)” or “What Else Are You Going To Do With Your Money?”

Back of the Class: “(anything involving the words ‘Property Ladder’ or ‘Bullet-Proof’)”, “I’ll Get Rich, Rich I Tell You!! (manic laughter)”

—
Obliquely related story:

Major condo developers in Vancouver are shutting out average buyers by selling their most affordable new units privately – to clients of select realtors and “family and friends” – before their advertised sale dates, The Globe and Mail has learned.
—
Eager buyers camp out in lineups for hours or days before the sales events. Thousands also sign up online to get “VIP” access, only to find out on opening day they had no chance. Several have said they were then invited to buy something more expensive.
—
Mr. Rennie said developers advertise to the public as a sort of fallback policy. If the insiders who get first dibs do not buy enough units, they can sell what is left to the next tier of interested buyers.
—
Toronto realtor Andrew la Fleur said condos are selling out to insiders in that hot market, too. He said he is one of the few agents whose clients get first crack at properties before the public. He estimates 95 per cent to 100 per cent of new condos are sold to insiders that way. “I think the public is just unfortunately misinformed or uneducated,” Mr. la Fleur said. “Those of us in the industry can see this coming a mile away and we know how to get our clients in at an opportune time.”
However, he said he does not think most units in Toronto will be flipped, because condo prices are not increasing in that city like they are in Vancouver.
– from ‘Vancouver developers shutting out regular buyers with insider condo sales’, Kathy Tomlinson, G&M, 17 Jun 2016 [hat-tip 3rdRock]

The average price of a single-family detached home in the Greater Vancouver area has increased as much in the past five months as it did from 1981 to 2005.

Thu, 16 Jun 2016 20:59:33 GMT

So profound, it deserves to be said again:
“The average price of a single-family detached home in the Greater Vancouver area has increased as much in the past five months as it did from 1981 to 2005.”
– from ‘World Out Of Whack! Which of these crazy real estate markets will be the first to bust?’, Zerohedge, 16 Jun 2016

For Those Who Have Lost All Perspective, Think On This

Wed, 15 Jun 2016 14:18:43 GMT

After surviving a serious illness and divorce, Denise Franklin was more than ready to start over. With a $25,000 budget, she approached architect Henry Yorke Mann to help her build a home fit for a fresh start in rural British Columbia. Mann saved money by severely restricting the size and material cost. Designing the 280-square-foot space in a mandala shape, Mann gave this home all the essentials and more. Franklin loves nature, and it was important that the home feel connected to the outdoors. A front porch reaches out into her front yard and vegetable garden. Mann used all natural and local materials — no synthetic or plastic materials were used in any part of the home. Durable, insulated metal roofing keeps the home well protected from the elements.
– from ‘Tiny B.C. cabin — at 280 sq. ft. — provides more than enough space to start a new life, and garden’, National Post, 14 Jun 2016

“Watch The Money Go Round, Watch The Money Go Round, Got It Wrapped Up Tight, Got It Safe And Sound….”

Wed, 01 Jun 2016 05:36:39 GMT

Watch The Money Go Round

“Given the rogue nature of the industry in this province, I’m not surprised someone calling for more transparency and professionalism would be considered a threat. In a sector that often seems unregulated, it has never been easier to make gobs of cash – legally or illegally. Few want to jeopardize the dynamics that are allowing many to get filthy rich very quickly.”
– from ‘Oversight of British Columbia’s housing market is a sham’, Gary Mason, G&M, 31 May 2016

“Representatives of two real estate companies are traveling with the B.C. Premier on a trade mission to Asia, raising questions about the optics of the perceived partnership at a time when many are calling for an end to foreign real estate investment.
The B.C. government lists more than 60 companies taking part in the trade mission to Korea, Japan and the Philippines as part of the province’s strategy to create more international trading partners.
Listed among those companies are two real estate brokerages Nu Stream Realty and Sutton West Coast Realty.”
“It’s bad optics,” said University of British Columbia business professor Tsur Somerville.
“At a time when people in the Lower Mainland are very concerned about the extent to which foreign capital is driving up prices here and contributing to affordability options, it seems a little bit politically dicey to take [brokerage] firms … along on a trip to Asia.”
– from ‘B.C. real estate companies join Christy Clark on trade mission to Asia’, CBC, 28 May 2016 [hat-tip 3rdRock]

How to Pack Up Your Kitchen Pantry When Moving

Mon, 09 May 2016 16:55:08 -0400

The kitchen has always been a scary place when it comes to packing up for a move. Between the heavy pots and pans, the fragile glasses and dishes, and the sharp cutlery, packing up items can be a nightmare. This goes the same for the pantry itself since you’re packing up items that may expire Continue Reading »

Original Article was found here: How to Pack Up Your Kitchen Pantry When Moving



How to Pack Up Your Kitchen Pantry When Moving

Mon, 09 May 2016 16:54:59 -0400

The kitchen has always been a scary place when it comes to packing up for a move. Between the heavy pots and pans, the fragile glasses and dishes, and the sharp cutlery, packing up items can be a nightmare. This goes the same for the pantry itself since you’re packing up items that may expire Continue Reading »

Original Article was found here: How to Pack Up Your Kitchen Pantry When Moving



How to Pack Up Your Kitchen Pantry When Moving

Mon, 09 May 2016 20:54:00 GMT

The kitchen has always been a scary place when it comes to packing up for a move. Between the heavy pots and pans, the fragile glasses and dishes, and the sharp cutlery, packing up items can be a nightmare. This goes the same for the pantry itself since you’re packing up items that may expire Continue Reading »

Original Article was found here: How to Pack Up Your Kitchen Pantry When Moving

Sponsored: 64% off Code Black Drone with HD Camera

Wed, 04 May 2016 18:04:45 GMT

Our #1 Best-Selling Drone--Meet the Dark Night of the Sky!

Vested Interests Rule, Okay? – Any Change In The Vancouver Housing Market Will Not Be Coming From Government Policy

Tue, 03 May 2016 16:31:28 GMT

The interests of BC Liberal Party donors who fund Premier Christy Clark’s salary top-up appear to be determining the government’s response to the housing affordability crisis in the province, says NDP critic David Eby.
A lot of BC Liberal donations come from wealthy people in the real estate industry, and the party’s person in charge of keeping them flowing is himself a top marketer of condo developments, Bob Rennie.
A recent City of Vancouver study found that roughly 12.5 per cent of condos in the city are empty, Eby said. And yet the government has declined to take steps to discourage owners from allowing condos or other homes to sit empty.
Asked Eby, “Why would [Clark] rush to put an additional tax on international investors holding these condos empty if she’s getting major donations from luxury condo builders who want this to continue?”
Clark confirmed this week that she has personally received in total more than $300,000 from the BC Liberal Party in annual stipends since she became leader in 2011.
—
Elections BC’s database of political contributions shows many people and companies involved in the real estate industry gave the BC Liberals donations in the tens of thousands of dollars in 2015, the most recent year for which figures are available.
Names appearing near the top of the list, each having given at least $50,000 during the year, include the Aquilini family, Bosa Properties Inc., Concord Pacific, Developments Corp. Inc., Shape Properties, and developers Rick Ilich and Peter Redekop.
The fundraising chair for the Liberals is condo marketer Rennie, whom The Tyee recently reported gave the party $73,500 in 2015.
“Bob Rennie’s a great example,” Eby said. “Here’s a guy who is one of the most famous condominium sales agents in North America who is running the fundraising for the Premier who refuses to put a tax on speculative investors driving up the prices of condos in Metro Vancouver.”
People can’t help but ask questions about Rennie’s involvement in the party and how it might affect Clark’s policy choices, said Eby. “Why is she refusing to act? Is it because the chair of her fundraising committee is a condo salesman? That is a legitimate question in my mind and one we should all be asking.”
—
– from ‘Clark’s Pay from Donors Too Tied to Real Estate Moguls’, Andrew MacLeod, TheTyee.ca, 2 May 2016

“Who is going to drive our buses and make art?”

Mon, 02 May 2016 14:09:20 GMT

Gayle Swain shared the story of her outof-the-ordinary Vancouver-born parents while sitting at a sidewalk table with four friends at Wicked Café, at Seventh and Hemlock. One of those friends was born in B.C., in Port Alberni, while two are immigrants, from Britain and the U.S.
The foursome had mixed feelings about what is happening to this fast-changing city, where relatively few have deep roots.
Even though they valued how the world’s cultures peacefully coexist in the city, they also regretted how in-migration has been a factor in the city’s fast-rising housing prices and in the way neighbourhoods are becoming “construction zones.”
When a flashy sports car interrupted their conversation by roaring down Hemlock, the friends also commented on how traffic in the city was becoming increasingly “aggressive” and “crazy.”
—

Justin Fung is among the Vancouver-born who are struggling with whether they should become more mobile.
Fung has a solid career in Vancouver’s high-tech industry. But he believes he could get more out of his salary if he moved to the Seattle or San Francisco areas.
Fung, his wife (also born in Vancouver) and young daughter squeeze into a small condo in Vancouver. “There’s no space to yourself.”
He believes the family could afford to live in a larger home, even a detached one, in the U.S.’s West Coast high-tech regions.
Many of Fung’s ethnic Chinese and Caucasian friends with children have already moved to the suburbs or other cities.
“But some are already coming back to Vancouver. They miss the city and there’s a long commute,” he said. “I feel frustrated at where this city is going.”
The key reason Fung’s family is trying to stay close to the west side of Vancouver is to be near his inlaws and parents, who immigrated to Canada from Hong Kong in the 1970s.
Fung attended Eric Hamber Secondary School, where he said the student population in the 1990s became 95 per cent Asian, most with roots in Hong Kong and Taiwan.
“There was a kind of cultural exchange when I was attending high school in Vancouver. But I think that’s largely missing now,” he said, adding: “There’s a general negativity” about Metro’s in-migration trends.
“I’m very pro-immigrant for the right kind of people, for those with skills who will bring innovation,” Fung said.
But, echoing the findings of UBC geographers and others, Fung regrets how the federal government has welcomed many “wealthy people who drive up housing prices and treat this as a resort town.”
When Fung visits his parents on the west side of Vancouver, he notices many of the neighbouring houses are empty. It’s leading, he said, to a “hollowing out” of the city’s culture.
—

Lorne Korman, a psychologist, is among the 16 per cent of Metro Vancouver’s population who have arrived from other Canadian provinces or territories. He was raised in Montreal and has worked in Toronto.
He finds Metro Vancouver’s inhabitants are “less connected” than Quebeckers and more “laidback” than Torontonians. “In Montreal, we knew all our neighbours. We’d always be having a cup of coffee or glass of wine with them,” said Korman, who came to B.C. a decade ago with his Chinese-Canadian wife.
Living in Richmond and working in Vancouver, he has found residents of the growing metropolis tend to be “friendly on the outside. But you can never quite know what’s happening underneath. They’re polite, they make eye contact, but they’re harder to get to know.”
Given the city’s high mobility rate, Korman isn’t surprised a Vancouver Foundation study discovered that “loneliness” is a leading anxiety of city residents.
Even though Metro has a reputation as a “Lotus Land” of nature lovers and yoga practitioners, Korman said he’s found it surprisingly right wing.
“The B.C. Liberals aren’t really liberals.” He thinks the predominance of right-wing politicians is due to an exaggerated individualism among the relatively transient population.
The clinical psychologist says residents have allowed B.C. politicians to cut mental-health services to the marrow, unlike in Ontario. Too many people in Metro Vancouver, he says, “have a let-them-eat-cake kind of attitude. People without a voice are being neglected.”
With house prices and rents soaring in part because of wealthy newcomers, Korman wonders about the future of community and the middle and lower classes. “Who is going to drive our buses and make art?”
He finds Metro Vancouver has a “surreal” quality. As he cycles each day to his Broadway office from Richmond, he notices how many grand-looking new houses are, despite appearances, vacant.
“Their sprinklers go on in the rain.”
—

– from ‘In mobile Metro Vancouver, third-generation locals are hard to find’, Douglas Todd, Vancouver Sun, May 1, 2016

How to Pack Up and Move Your Home Office

Tue, 19 Apr 2016 14:28:12 -0400

For many people, a home office isn’t just a place to store all the paperwork that goes with owning a house, nor is it a junk room for dumping all the stuff that doesn’t fit anywhere else. The new home offices are just that—fully functional offices that people use on a daily basis as they Continue Reading »

Original Article was found here: How to Pack Up and Move Your Home Office



How to Pack Up and Move Your Home Office

Tue, 19 Apr 2016 14:26:46 -0400

For many people, a home office isn’t just a place to store all the paperwork that goes with owning a house, nor is it a junk room for dumping all the stuff that doesn’t fit anywhere else. The new home offices are just that—fully functional offices that people use on a daily basis as they Continue Reading »

Original Article was found here: How to Pack Up and Move Your Home Office



Crescent Moving & Storage — How to Pack Up and Move Your Home Office

Tue, 19 Apr 2016 18:26:08 GMT

via Crescent Moving & Storage http://crescentmovingstorage.tumblr.com/

How to Pack Up and Move Your Home Office

Tue, 19 Apr 2016 18:26:00 GMT

For many people, a home office isn’t just a place to store all the paperwork that goes with owning a house, nor is it a junk room for dumping all the stuff that doesn’t fit anywhere else. The new home offices are just that—fully functional offices that people use on a daily basis as they Continue Reading »

Original Article was found here: How to Pack Up and Move Your Home Office

Ease Your Children Into Moving to a New Home

Mon, 11 Apr 2016 22:30:06 -0400

When a family moves into a new home, it can be a major transition. Whether that home is across town or across the country, there are many changes that a family must get used to including new neighbors, stores, communities, and, especially, schools. While adults are usually very good about changing and being able to Continue Reading »

Original Article was found here: Ease Your Children Into Moving to a New Home



Ease Your Children Into Moving to a New Home

Mon, 11 Apr 2016 22:29:17 -0400

When a family moves into a new home, it can be a major transition. Whether that home is across town or across the country, there are many changes that a family must get used to including new neighbors, stores, communities, and, especially, schools. While adults are usually very good about changing and being able to Continue Reading »

Original Article was found here: Ease Your Children Into Moving to a New Home



Ease Your Children Into Moving to a New Home

Tue, 12 Apr 2016 02:29:00 GMT

When a family moves into a new home, it can be a major transition. Whether that home is across town or across the country, there are many changes that a family must get used to including new neighbors, stores, communities, and, especially, schools. While adults are usually very good about changing and being able to Continue Reading »

Original Article was found here: Ease Your Children Into Moving to a New Home

Home sales hit record 5,000 in March in Vancouver area

Mon, 04 Apr 2016 15:40:59 -0400

For the first time in the Vancouver area, more than 5,000 homes have sold in a single month. A total of 5,173 residential properties were sold in the region in March, marking a 27.4-per-cent increase over March 2015 and a 24-per-cent increase over February 2016, according to the Real Estate Board of Greater Vancouver. “March […]

from http://www.vancouversun.com/business/affordability/home+sales+record+march+vancouver+area/11828954/story.html



Home sales hit record 5,000 in March in Vancouver area

Mon, 04 Apr 2016 15:39:38 -0400
Home sales hit record 5,000 in March in Vancouver area:
For the first time in the Vancouver area, more than 5,000 homes have sold in a single month. A total of 5,173 residential properties were sold in the region in March, marking a 27.4-per-cent increase over March 2015 and a 24-per-cent increase over February 2016, according to the Real Estate Board of Greater Vancouver. “March […]
from



Home sales hit record 5,000 in March in Vancouver area

Mon, 04 Apr 2016 19:39:00 GMT

For the first time in the Vancouver area, more than 5,000 homes have sold in a single month. A total of 5,173 residential properties were sold in the region in March, marking a 27.4-per-cent increase over March 2015 and a 24-per-cent increase over February 2016, according to the Real Estate Board of Greater Vancouver. “March […]

from http://www.vancouversun.com/business/affordability/home+sales+record+march+vancouver+area/11828954/story.html

CMHC tracks apartment turnover in Vancouver's hot rental markets

Tue, 29 Mar 2016 23:15:04 -0400

Results from Canada Mortgage and Housing Corp.’s first-ever rental turnover survey in Metro Vancouver points to a migration of rental demand from the pricier centre to less-expensive suburbs.

from http://www.vancouversun.com/business/real-estate/cmhc+tracks+apartment+turnover+vancouver+rental/11816534/story.html



CMHC tracks apartment turnover in Vancouver's hot rental markets

Tue, 29 Mar 2016 23:13:57 -0400
CMHC tracks apartment turnover in Vancouver's hot rental markets:
Results from Canada Mortgage and Housing Corp.’s first-ever rental turnover survey in Metro Vancouver points to a migration of rental demand from the pricier centre to less-expensive suburbs.
from



CMHC tracks apartment turnover in Vancouver's hot rental markets

Wed, 30 Mar 2016 03:13:00 GMT

Results from Canada Mortgage and Housing Corp.’s first-ever rental turnover survey in Metro Vancouver points to a migration of rental demand from the pricier centre to less-expensive suburbs.

from http://www.vancouversun.com/business/real-estate/cmhc+tracks+apartment+turnover+vancouver+rental/11816534/story.html

Barbara Yaffe: Seniors ready to retire still facing large personal debts

Tue, 29 Mar 2016 18:15:01 -0400

Vancouver-area seniors tend to be viewed as equity-rich fat cats with paid-off homes to finance their post-employment years. As the myth goes, these folks sell their West Side homes for millions, then relocate to stylish condos or retreats in Sechelt or Qualicum Beach while having enough left over to dole out downpayments on housing for their children.

from http://www.vancouversun.com/business/real-estate/barbara+yaffe+seniors+ready+retire+still+facing/11816061/story.html



Barbara Yaffe: Seniors ready to retire still facing large personal debts

Tue, 29 Mar 2016 18:14:11 -0400
Barbara Yaffe: Seniors ready to retire still facing large personal debts:
Vancouver-area seniors tend to be viewed as equity-rich fat cats with paid-off homes to finance their post-employment years. As the myth goes, these folks sell their West Side homes for millions, then relocate to stylish condos or retreats in Sechelt or Qualicum Beach while having enough left over to dole out downpayments on housing for their children.
from



Barbara Yaffe: Seniors ready to retire still facing large personal debts

Tue, 29 Mar 2016 22:13:00 GMT

Vancouver-area seniors tend to be viewed as equity-rich fat cats with paid-off homes to finance their post-employment years. As the myth goes, these folks sell their West Side homes for millions, then relocate to stylish condos or retreats in Sechelt or Qualicum Beach while having enough left over to dole out downpayments on housing for their children.

from http://www.vancouversun.com/business/real-estate/barbara+yaffe+seniors+ready+retire+still+facing/11816061/story.html

English Tudor heritage home from 1922 could face wrecking ball in Vancouver

Mon, 28 Mar 2016 22:42:41 -0400

Vancouver’s heritage homes seem to be disappearing as rapidly as the original forest they replaced.

from http://www.vancouversun.com/business/real-estate/english+tudor+heritage+home+from+1922+could+face/11814131/story.html



English Tudor heritage home from 1922 could face wrecking ball in Vancouver

Mon, 28 Mar 2016 22:41:18 -0400
English Tudor heritage home from 1922 could face wrecking ball in Vancouver:
Vancouver’s heritage homes seem to be disappearing as rapidly as the original forest they replaced.
from



English Tudor heritage home from 1922 could face wrecking ball in Vancouver

Tue, 29 Mar 2016 02:41:00 GMT

Vancouver’s heritage homes seem to be disappearing as rapidly as the original forest they replaced.

from http://www.vancouversun.com/business/real-estate/english+tudor+heritage+home+from+1922+could+face/11814131/story.html

Airbnb's popularity has cities around the world on edge

Fri, 25 Mar 2016 14:54:11 -0400

Across North America, city governments and neighbourhood activists are worried that the exploding popularly of Airbnb is hurting neighbourhoods and putting a strain on rental housing stock, as landlords choose the lucrative option of short-term rentals over long-term tenants.

from http://www.vancouversun.com/business/real-estate/airbnb+popularity+cities+around+world+edge/11809016/story.html



Airbnb's popularity has cities around the world on edge

Fri, 25 Mar 2016 14:53:28 -0400
Airbnb's popularity has cities around the world on edge:
Across North America, city governments and neighbourhood activists are worried that the exploding popularly of Airbnb is hurting neighbourhoods and putting a strain on rental housing stock, as landlords choose the lucrative option of short-term rentals over long-term tenants.
from



Airbnb's popularity has cities around the world on edge

Fri, 25 Mar 2016 18:53:00 GMT

Across North America, city governments and neighbourhood activists are worried that the exploding popularly of Airbnb is hurting neighbourhoods and putting a strain on rental housing stock, as landlords choose the lucrative option of short-term rentals over long-term tenants.

from http://www.vancouversun.com/business/real-estate/airbnb+popularity+cities+around+world+edge/11809016/story.html

Chinese investors buy one-third of Vancouver homes: National Bank estimate

Wed, 23 Mar 2016 15:43:02 -0400

Buyers from China comprised about one-third of purchases of Vancouver’s hot housing market in 2015, according to “back of the envelope calculations” by National Bank of Canada. Chinese investors spent about $12.7 billion on real estate in Vancouver in 2015, or 33 percent of its $38.5 billion in total sales, according to a note […]

from http://www.vancouversun.com/business/bc2035/chinese+investors+third+vancouver+homes+national+bank/11804486/story.html