- from The Province, 14 Nov 2011
Most Recent Comments:
- kabloona on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- James on “I had a work colleague approach me today to ask about buying a condo in New West. She had no idea about the economics of ownership and real estate.”
- Brian on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- investigativezim.com on Consequences, Intended and Otherwise
- Nemesis on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- dumpster diver on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- Joe at Kits on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- YVR Housing Analyst (@YVRHousing) on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- tedeastside on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- Nemesis on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- an observer on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- ex-kitsie on “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
Type of Anecdote
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- 20. The Limitless Demand Argument For Ongoing Market Strength (70)
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- 22. RE References In Popular Culture (41)
- 23. Jumping The Shark (1)
- 24. Policies On Housing (10)
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- Uncategorized (176)
Blogroll
- 01 Vancouver Condo Info
- 02 AmericaCanada [retired, no archive]
- 03 Housing Analysis
- 04 RealEstateTalks BC
- 05 Vancouver RE and then some
- 06 Whispers from the Village on the Edge of the Rainforest
- 07 Greater Fool
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- 10 YatterMatters
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- 14 Landlord Rescue
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- 17 Hoodsurf [retired Jun 2011]
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- 20 North American Economics
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Latest Anecdotes:
- “The bank encouraged her to take the equity in her home to purchase another home. She bought a 2nd home at the peak.”
- “Let’s remember how we got here” – Looser and Looser CMHC Limits
- Don’t Worry, I’m Sure Somebody Will Sort This All Out – “Policymakers now know better and will be a lot more proactive in preventing a collapse.”
- “Things have changed, we are not doing that type of mortgage. We are not interested at all.”
- “We are noticing our target type of housing in price decline, albeit slow, as our money increases in value, slowly as well but outpacing housing.”
- Renter Buys In West Van – “For a few hundred more per month, you could own the place. Which is what I will be doing as my offer for a place down the street has been accepted. There is some value in staying in one place.”
- A Bed in the Bathroom, Why Not? [Let Us Count The Reasons...]
- “My husband and kids are pretty happy in our rental house within cycling distance of work that we could never have afforded otherwise. We’re doin’ pretty dang well, thank you, for median income earners in this expensive city.”
- “I Wish Them Bad Luck.” – Jim Flaherty, on those who wish to profit from Canadian RE price drops
- “We asked why he doesn’t just rent the whole house. He said he can’t, it wouldn’t cover his mortgage – he’ll get more to rent it out as two suites. These new landlords are hilarious, thinking that rent will cover their mortgage!”
- “My neighbours, in their late 60s, just put their house on the market. They had said they would die in that house, but now they are worried that with the housing market going south they may be losing a lot of equity and they better sell now before it gets worse.”
- Chat Thread
- Taking A Break
- “My best guess: this property is now an ‘investment hold’ and will be built ‘when prices recover’. Good luck on that!”
- Man Loses $745,000 Vancouver Condo Deposit
- Graphic – Degrees of Housing Overvaluation in Canada
- The Rare Individual With A Negative Ownership Premium
- Advice Regarding Renting In Vancouver, Please – “Unfortunately, the Vancouver rental stock is absolutely atrocious. It just seems like every landlord is looking for someone to pay 100% of their mortgage on a crappy place through rental income.”
- “I just visited Manhattan for a week, and happened to snap some real estate ads on both the Upper West and Upper East sides of the island. Compare to Vancouver. It simply doesn’t compute.”
- Ben Rabidoux In Vancouver Next Week
- “The mortgage company told me they were calling in my 40-year, 0-down mortgage. I have paid nearly sixty thousand dollars towards it, but, nearly five years in, I have yet to touch the principal.”
- ‘Vancouver City Hall: Housing Report Card 2012′; Plus Revised Version
- “My folks find themselves at 65 still owing half the value of their home and recreation property to the bank. After almost 30 years of ownership in the BPOE and a number of boom markets, they have very little to show for it.”
- “Rent for $2,200 a month or buy and have a mortgage of $4,310 per month. Why would anyone buy?”
- “They were talking about two couples they knew who had recently bought a lot and planned to each build a house on it and live as neighbours.”
- Greater Vancouver Home Builders’ Association Annual First-Time Buyer Seminar Attendance Plummets
- Mom and Pop Get It Wrong In All Markets, Time And Again
- The average British Columbian homeowner is not going to pay off their mortgage by the time they retire.
- “He’s sold all his properties except his current one, which is now for sale. He explained that the market’s currently in crash mode, worst that he’s ever seen.”
- “One of my old high school buddies finally got her mother to sell the family home in Kitsilano – sold for over $1M, monies realized after debt paid off $185K.”
- “I know someone who just declared bankruptcy because her condo was assessed at $150k and she bought it presale north of $250k in 2005 or 2006.”
- Sturdy, With Views – “Calling Froogle Scott!… Is Dr. Scott ‘In The House’?” [Not In This One, Certainly]
- “She said the market was dead in Victoria and that it would remain so for a very long time. I asked how she knew. Her answer was fascinating and should scare the pants off the real estate crowd.”
- Kits Notes – “I’m pretty sure that this is the first 3+ bedroom property of any type that I’ve seen in the 5 years I’ve lived here that is priced below $700K.”
- “A beautiful Belfast home, in the equivalent of 1st Shaughnessy, bought at their RE peak in 2007 for £3.5 million, has now sold for £800K, almost 80%-off. The market didn’t suffer any significant economic shocks. Rates & unemployment didn’t skyrocket. They didn’t build more land. Sentiment just changed and the prices fell and fell.”
- “Two family members of hers are trapped, underwater, in condos on the East Side.”
- “Interprovincial migration is not saying good things about BC’s economy.”
- Vancouver RE: Not As Expensive Provided You Don’t Think – “It’s clear that our perception of affordability has been coloured by living on a continent where housing is unusually inexpensive.”
- More Undisclosed RE Industry Insiders Publicized As Clients – “In 1995, Allan and Karin Hoegg were mortgage-free. But no more. Today their Vancouver home is a valuable source of income as they plan for full retirement.”
- Rumor that some OV units will be reduced by 20%.
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Anecdotes Banks Bears blogs British Columbia Bubble Bulls buyers Canada Capitulation China CMHC Construction Debt Economy Employment Fear Foreign buyers Fundamentals Government Housing Interest Rates Landlords Life Media Mortgage brokers Okanagan Olympics Ownership Prediction Real Estate Realtors Relationships Rent Retirement RE_ATM sellers Sentiment Speculators Toronto US Vancouver Victoria Visual Anecdote Whistler
Awesome, I feel like cooking up a HAM.
IF the problem with Vancouver real estate is HAM and IF HAM is mostly the investor class of immigrants, then restrictions on foreign ownership won’t help.
Vreaa, not sure if you have seen this article: “Buy diapers or pay the mortgage?”
Below are a few gems from the article:
“Right around the time most of us are changing our first diapers, we’re also buying our first house. Mortgage payments, property taxes, home maintenance and other home-ownership costs swallow 48 per cent of a typical family’s pretax annual income.”
“Owning a home turned out to be an even bigger shock. It wasn’t the mortgage payments, which were about equal to what we had been paying in rent. It was the maintenance costs. Our house was close to 90 years old and our big green monster of a furnace soon conked out. A new one set us back $4,000. Then our roof leaked and we had to hire a contractor to reshingle. That set us back another $5,000. We put most of these repairs on our credit card and home equity line of credit.”
“No matter what your priorities are, don’t feel guilty about accomplishing them slowly. “To some degree your 30s are a time of debt accumulation rather than asset accumulation, and as long as it’s good debt – like a house or a reasonable car loan – that’s okay,” says Scott Ellison, a certified financial planner in Halifax.”
I’m in my 30′s and have no debt, I’m renting and I contribute to my RRSP. After reading that article, I feel like I’m a weirdo. I should call my bank and get myself into debt, I’ll probably feel better…
Here is the link to the article: http://www.theglobeandmail.com/globe-investor/personal-finance/retirement-rrsps/buy-diapers-or-pay-the-mortgage/article2234118/page1/
These guys got off cheap. For us it was 11k for a new roof and 7k for a new furnace.
wow. if the sampling was done properly. if ham is a bona fide inflow of real capital, that should not be a -ve. however, if everyone just went on a credit binge, that is most definitely a very big -ve. how much of ham is derived from real capital formation vs credit out of thin air? chanos seems to think he knows. anyway, it is hard to see how any measures taken at a civic level could have prevented this. just about anything you do has unintended consequences.
This poll is worthless.
The majority of the population in this province is asian now and they dont even know what the province is, let alone reading it.
It definitely shows the view of the whites left in Vancouver, but in no way can that be seen as a majority view.
“The majority of the population in this province is asian ”
Sorry to be pedantic, but while this may be true of some municipalities in the lower mainland, for the province as a whole this statement is not even close to being correct.
http://en.wikipedia.org/wiki/Demographics_of_British_Columbia
lol youre a fuckin idiot
Paradox,
Are you suggesting that the Chief of the VPD doesn’t know what the Province is simply because he is asian?
Race card! LOL
A better question: Can the City of Vancouver put restrictions on foreign ownership?
Good question. Perhaps through provincial act or law on behalf on the municipality? The city could effectively restrict foreign ownership through it’s property tax structure making SFHs with land extremely expensive for non-residents to purchase but the passing of laws preventing foreigners from buying re-sale homes is likely a provincial issue. In most countries it’s the federal government that controls foreign investment. Here’s a link discussing the new Australian restrictions on foreign ownership:
http://www.chinaconnections.com.au/Blogs/Tightening-of-restrictions-on-foreign-investment-in-real-estate-Australias-new-regulatory-framework.html
Yes but council can only advocate for this. When it gets down to it, it’s far from clear that council has the ability to do much, too many legal restrictions set up in the muni act.
The only way this gets play is if it becomes provincial issue and right now there isn’t much dialogue except in the media. I figure the only way it gets play is if the NDP make it a class issue, run a strong business-focused candidates in Van West ridings, and press the issue. If Clark is running in Vancouver Pt. Grey at the next election it’s definitely an issue there.
But I wouldn’t get my hopes up. It’s important that all options are discussed, which they aren’t now.
One other thing I’ve noticed. @pladner on twitter is starting to bring up the foreign investor thing again but only points to anecdotes. I know I might be a bit prollie here, but hey Peter welcome to the club of powerlessness! I know people living in social housing unable to move away from a drug-dealing neighbour because if they move they give up their subsidy. Or the middle class family who bought an SFH and could soon find themselves in negative equity. Listen, I sympathize with having property not being occupied by contributing citizens, I am highly skeptical that alleviating foreign ownership of westside properties, which to be frank looks to be a relatively isolated issue region-wide, is going to ease the pain of my retired friend and soon-to-be insolvent neighbour.
Let’s make both foreign investment and CMHC more expensive. One will be good cover for the other. I don’t know which is the cover and which is the culprit, but I can guess.
Good questions, except that it will be a bunch of fuss and do nothing. Considering that it is immigrant money that is responsible for a lot of these crazy purchases, that is not considered foreign as they are canadian resident.
Absolutely Julian. This is a key point, that through various means immigrants can maintain residency but not necessarily physically occupy a dwelling. This has gone on for donkey’s years (since the early-’90s at least for anyone old enough to remember). Some friends of mine who grew up on west side were astronaut families during that time. There were stories of westside neighbours becoming upset with a property that was unoccupied and the grounds became unkempt. This is not unique to Vancouver either, it happens all over.
The only thing foreign ownership restrictions can do IMO is take the sheen off the “endless foreign money” argument. That might be enough to scare away some dumb money (remember how sales dropped off in Richmond after the Japanese tsunami?) and get things a bit more normal. But to think that we can structure some regulation to prevent absentee ownership is highly questionable, not least because a few “established” folks can take extended vacations or sabbaticals from time to time.
Given that Austrailian restrictions on foreign ownership seem to be having the desired effect of moderating SFH prices in Australia, I’m led to believe that restricting hot money is exactly the way to go. China has it’s own restrictions to prevent speculators from buying multiple properties in order to restrict available supply and push up prices. The Chinese government recognizes the growing unrest in its citizens who are unable to afford homes despite their intentions to provide social stabiity for its workers.
SFH’s shouid simply not be a speculative asset class for fast foreign money. There is a role for regulation in all market-based economies which should be pretty obvious for anybody who hasn’t been in a coma for the past few years. The GVRD has a serious problem of affordability for people who have to work for a living. In the extreme, if everyone working in the GVRD is renting from non-working/non-resident foreign owners I would think that social unrest will be the inevitable outcome. It’s not like history hasn’t provided a realistic precedent.
Jesse, you write: “The only thing foreign ownership restrictions can do IMO is take the sheen off the “endless foreign money” argument.”
Surely that’s a bit pessimistic? In other countries, haven’t restrictions actually preserved housing stock for inhabitants of all classes?
Jesse, you also write: “@pladner on twitter is starting to bring up the foreign investor thing again but only points to anecdotes. I know I might be a bit prollie here, but hey Peter welcome to the club of powerlessness! I know people living in social housing unable to move away from a drug-dealing neighbour because if they move they give up their subsidy. Or the middle class family who bought an SFH and could soon find themselves in negative equity. Listen, I sympathize with having property not being occupied by contributing citizens, I am highly skeptical that alleviating foreign ownership of westside properties, which to be frank looks to be a relatively isolated issue region-wide, is going to ease the pain of my retired friend and soon-to-be insolvent neighbour.”
I too think of course the focus mustn’t be only on west-siders no matter what’s happening there. However, Peter Ladner should get credit for having had the guts to stand up and say something publicly, under his own name, about what’s happening, and he’s now one of the people leading a battle that may result in help for both your friend and neighbour. Also, even given that the west side is full of very fortunate people who often have the power to advocate for themselves while other Greater Mainland denizens don’t, how “isolated” an issue is it if involves the entire west side of Vancouver? Finally, I was myself for years the unfortunate neighbour of drug-addicted grifters — on the west side; it happens there too — and also a witness to what a lack of community there can do to the Vancouver community as a whole.
There is nothing that will be worse for Vancouver than a widespread attitude of “Well, what can be done? Probably nothing.” That’s not how other jurisdictions have reacted. What’s that quote about how the best way for evil to triumph is for good men to do nothing? You and this website have already done a lot and I hope will encourage readers to do more.
“Surely that’s a bit pessimistic? In other countries, haven’t restrictions actually preserved housing stock for inhabitants of all classes?”
I haven’t seen much data for this. Complaints about high prices in these areas continue even after the restrictions were introduced.
” he’s now one of the people leading a battle that may result in help for both your friend and neighbour”
It may, or it may not. If the data show the “foreign ownership” problem is relatively isolated to a few specific neighbourhoods, then it’s time for some deep introspection. If the isolation of the problem does turn out to be true, then folks like Ladner will be chasing a symptom of a larger problem with relatively little impact on a per capita basis. As for his assistance for others in the city, he has a voting record on council that can be perused. No doubt he sees the problems of quality of social housing and all this, and took steps to help ameliorate them. I have heard nothing from Ladner on the possibility that cheap credit and high levels of debt might have a little something to do with the problems we’re facing. I don’t know the man personally but he has children who are approaching home-buying age. Now, apparently, it’s personal, never mind the likes of VHB and others have been sounding the horn for over 5 years now.
Others have decided to tackle deep affordability issues head-on instead of concentrating their efforts on more affluent areas. I agree that cheaper prices on the west side will help alleviate problems east of Ontario St. but to be frank they are not at the top of my personal triage list. What is for sure is that we need someone who is willing to unturn every rock to look for solutions without preconceived biases what is at the root of Vancouver’s current and past ills.
But yes I appreciate Ladner’s efforts. He seems like someone who has a lot to add to the conversation and I’m sure has more influence than a lowly anonymous blogger like myself.
” What’s that quote about how the best way for evil to triumph is for good men to do nothing? You and this website have already done a lot and I hope will encourage readers to do more.”
I hope so too.
“You may think your actions are meaningless and that they won’t help, but that is no excuse, you must still act.”
- Mohandas Karamchand Gandhi
Hope Mr F is listening.
Jesse, re: your saying “a lowly anonymous blogger like myself” — no, no!
Your blog may prove mightier than the bulldozer! THe Gandhi quote above is inspiring, thanks for posting it.
Vesta, I should mention Florida has significant property tax premiums for foreign owners. It didn’t stop their prices from increasing then subsequently cratering. Taxation of foreign owners is one option but for many that’s not a major concern. Hot foreign money is still being invested in certain (affluent) parts of Florida, as it is in other affluent parts of the US despite the national numbers showing big drops (drops by no means homogeneous BTW). I think that’s part of the underlying issue here, that as the world becomes more affluent the “best” land gets usurped because of orders of magnitudes difference in earnings power wielded by the “creme”.
I get that. I’m not confident that this is a city-wide problem and some zoning changes can help. We should remember too that a lot of the money in some of the country’s most affluent areas is local. Scrape the surface and one uncovers lot combining for mansions for local magnates. One hopes these folks spend most of their time here, or I might start calling them “foreign”! (In terms of their earnings compared to the median, they might as well have come from Mars…)
Interesting info! I hear you. One does feel as though one’s been shot to another planet, doesn’t one? Well, let’s just hope that some day more of the “last” will be “first” somehow.
Yeah I guess another day means one less day to Deliverance.
I think you are right – fighting income inequality has been a losing battle for the 99% until something more basic takes place. I suppose this is why the jasmine revolution and the occupy movement is all about. I guess the great thing about Canada is that it’s a big country and there’s lots of other great cities for Vancouverites to relocate to.
people need to start contacting the politicians continually about the ownership rules on housing – i personally checked the immigration stats and recent housing price increases because I thought it was immigration driving the housing inflation bus. But it doesn’t fully add up, so much of it must be foreign ownership. If you check some of the international blogs, you will see that it is foreign ownership, because the housing prices never really went down in Canada and there is so much ‘free’ in our Country – and it is not confined to West Van – ave prices in my white rock neighbourhood went up 23% in the last year. We are looking long term and realizing that our kids will not be able to afford to live here (rent right now is even more expensive than owning)…so we better move somewhere cheaper now and hope to hold the family together in the future – however, the same phenomenon is starting to happen in Calgary and everywhere else we look. I get more despairing by the day and regret having listened to Flaherty and Carney…
How many years will it take to get a mortgage decision to
be made?