Monthly Archives: February 2011

‘The Province’ Runs ‘Greater Vancouver Home Builders’ Association’ Advertisement As News Item

The Province ran the announcement ‘First-time buyer seminar‘ as a ‘news’ item, 27 Feb 2011. Seems like an ad to us. We hope no innocent FTBs see the ‘article’, or the seminar itself, as anything other. Excerpts follow. [hat-tip joycer at vancouvercondo.info]

“The Greater Vancouver Home Builders’ Association is once again offering a seminar aimed at helping first-time homebuyers sort through the often overwhelming process of making the jump into home ownership.”

“The presenting sponsor is the provincial Homeowner Protection Office, branch of BC Housing, and corporate sponsors are The Vancouver Sun, The Province, Canada Mortgage and Housing Corporation, Real Estate Board of Greater Vancouver, Genworth Financial Canada, Scotiabank, Travelers Guarantee, Sheraton Vancouver Guildford Hotel, Shaw Cablesystems, CKNW, Rock 101, AM 730 and 99.3 the FOX.”

Maclean’s – “Plenty of speculation that Vancouver’s hot housing market is in bubble territory”

Maclean’s 23 Feb 2011 article highlights BCs vulnerable personal debt situation.
Excerpts:

‘Canada’s Worst Spenders’
British Columbia has been Canada’s real estate debt champion since at least 1999

There’s been plenty of speculation that Vancouver’s hot housing market is in bubble territory, and as interest rates rise, that view is going to be put to the test. A new Toronto-Dominion Bank report says that one in 10 British Columbia households could find themselves scrambling to pay their bills if the Bank of Canada ups rates, as TD predicts it will—up to three per cent by the end of 2012.
The province has been Canada’s real estate debt champion since at least 1999, and it is the only one where the average savings rate is negative, according to TD.
Vancouver in particular seems to most resemble the housing run-up seen in the U.S. Two weeks ago, Robert Shiller, an economist at Yale University who correctly forecast the U.S. housing bust and helped develop the influential Standard and Poor’s Case-Shiller real estate index, likened the B.C. capital to San Francisco, one of the areas worst hit by the slump in the States.

“I’ve calculated it very carefully. It will be well worth the wait (even if it takes 5 years) when I buy that nearly new foreclosed detached home for cash.”

mattymatt at vancouvercondo.info February 24th, 2011 at 9:22 am“My wife makes the average income of about $52,000 a year and I own a machine shop in Richmond, my take home is about $110,000. In 2008 we thought the market was going to tank, so we sold (“Big mistake”) our paid-off condo in Richmond, banked some of the money and invested the rest. For a 1-1/2 years we rented a top floor of a Vancouver “shit” house in the neighborhood of 20th and Fraser (bigger mistake). It also had a “basement” which was rented out.
LIVING IN VANCOUVER IS NOT GREAT! : Traffic and commuting back to Richmond. Expensive rent for really old and shitty place! Assholes in basement suite…No parking everywhere… and the list goes on and on.
So, as of January, we moved to Queensborough New West and are renting a nice 2 bdr top floor 1300 sqft condo for about the same price as the home in Vancouver. Even better, my Brother in-law is staying with us and pays us a-little rent. We can enjoy our money instead of throw it into high mortgage payments, taxes and (“strata” – cause even with our combined wage and money saved, to buy a “detached house” for 800k + is retarded!).
I’ve calculated it very carefully. It will be well worth the wait (even if it takes 5 years) when I buy that nearly new foreclosed detached home for cash.
The longer Vancouver RE market goes up, the bigger the crash. I can’t believe people (especially first time home buyers) with average incomes are still foolishly buying!”

Three Strikes; We’re Outta Here – “If you like shoebox living or eighteen renters in your basement, by all means, make Vancouver your home.”

Angie at VREAA 26 February 2011 at 3:09 pm“After living and working abroad for a few years my husband (Scottish Nationality) and I moved back to Vancouver, my home town to start our family. After 1 year of living here we packed our bags for Ottawa and a decent wage and cost of living average. We bought a house and had 3 kids and lived the good life. We decided to move back to the West Coast to be closer to family and see if maybe things have changed. Instead of getting better things are just getting worse. It is only when you see how life is lived elsewhere that you can appreciate how wrong things are here. Vancouver is my home but there is only so much hype one can take, if you like shoebox living or eighteen renters in your basement by all means make vancouver your home, but after three failed attempts at finding balance in Vancouver I am happy to say I am making the right decision by leaving for good!!!”

Avoiding Vancouver – “Out-of-towners have been offered the job but all declined when they learned about RE values here.” … “My kids are looking to relocate. My family’s 150 years in Vancouver is likely to end with this generation.”

5th generation Vancouver at VREAA 22 Feb 2011 3:00pm“I also know of many professionals (Professors, doctors, many teachers, planners, engineers) who have decided to leave the city and even the country because of the RE costs and many jobs that can’t be filled. I have been approached five times over the last year for a certain $120,000 a year job in Vancouver and have learned that most of my colleagues in similar positions have also been headhunted. A few out-of-towners have been offered the job but all declined when they learned about RE values here. The rest of us turned down the offer because the cost to relocate to Vancouver from Maple Ridge/Langley/Coquitlam was too high and commuting for 2 hours a day was not on.
But my biggest concern involves my children who are now young adults in arts jobs. They have woken up to the fact that they will never be able to afford anything beyond a small condo in Surrey. So, my family’s legacy of helping this city for over 150 years, being involved in coaching, volunteering, and leaders in the community is likely to end with this generation. The kids are looking to relocate to New Zealand, Montreal or somewhere in the US.”

Home Offered For Sale and For Rent Simultaneously

From ’29’ at VREAA 21 Feb 2011 9:47am-
1494 West 40th Ave, Vancouver (40th & Granville)
3175 sqft home; 6905 sqft lot
Listed for rent on craiglist: $4,300 x12 = $51,600 p.a. “prefer long term lease”
Listed for sale MLS V859209: Sales price $1,288,000
Cap rate: 4% [High for a west side SFH, many renting at 2% cap rates. -ed.]

http://postimage.org/image/782rwdpg/
http://postimage.org/image/78mmcjms/

’29’ adds: “I came across sellers, to fool buyers, arranged with their tenants to rent at higher than market rents with a written promise to return the excess rents collected plus a bonus when the house was sold.”

“I know a number of cases of underused houses purchased by asian buyers.”

900kCrackHouse at vancouvercondo.info February 15th, 2011 at 8:43 am“I know a number of cases of underused houses purchased by asian buyers:
1) My friends apartment was just purchased by foreign buyers and he was kicked out for “renovations”
2) I know a 20 year old university student who’s rich aunt from Asia just bought him a house in North Burnaby. He manages the tenants and when he can afford to pay the 70% mortgage, he gets the house. Oh, and I should mention they own two more houses in Burnaby, one of them a $1 million dollar house occupied only by the Aunt’s 18 year old kid.
3) Huge house in Fraser Heights in Surrey occupied by a 90 year old Grandma. The 18 year old daughter used to live there, but she wanted to live close to UBC so they bought her a condo out there.”

What do you do when you’re the investor owner of an ‘underused house’ and the price starts steadily dropping, month after month? Along with ‘local speculator’, and ‘boomer’ supply, ‘foreign investor’ supply will all start coming into the market at the same time. These groups of investors are largely momentum players, and they’ll start leaving when prices start heading the wrong way. -vreaa