‘Are Canadians the New Chinese?’
“So the Christmas season is upon us. It’s time to build a fire in the fireplace, brew up some mulled wine and spend time with the family. A good conversation starter at this time of year might be last night’s Christmas party or upcoming vacation plans.
But if you’ve had enough sugar and spice and everything nice and feel like ruffling some turkey feathers then try dropping the following comment into conversation:
“I welcome Chinese investment in Vancouver real estate”
Mouths will fall open, the music will stop with an exaggerated record scratch and the fire in the fireplace will be mysteriously snuffed out.
These words are guaranteed to start a raucous debate, especially if the booze is flowing. The soaring price of Vancouver real estate is the topic on everyone’s mind. Unfortunately speculation is plentiful, with little concrete fact—just open a newspaper or scroll the Vancouver Real Estate Anecdote Archive for the latest horror stories and heated opinions.
Is Vancouver’s housing bubble about to burst? Is there even a bubble? If so, what’s behind it? Etc. It has our heads spinning and our wallets quivering in fear.
Some feel that the Chinese are to blame for the hefty price tags on Vancouver homes. Recent economic prosperity in China has led to the emergence of a huge class of ‘new rich’ and they are buying up Canadian real estate, sight unseen, to the chagrin of many.
And yet, Canadians are doing the exact same thing in the States, in places like Las Vegas, Florida and Arizona. The economic fallout from the sub-prime mortgage crisis combined with the overall tightening of US credit markets has led to a dramatic drop in real estate prices. The bottom line: American real estate is an accessible and potentially lucrative investment and many Canadians are already taking advantage of the opportunity.
If a house is for sale, whether it be in Arizona or Vancouver, and somebody has the money to buy it, should it matter where they come from?”
- Cam Good, local real estate salesman, post at The Key marketing group website, 16 Dec 2011 [hat-tip Gord]
We’re touched by the VREAA mention. But “horror stories”? We haven’t even started running the ‘horror stories’ yet; they, unfortunately, come later.
And they will be that much more horrific given the heights from which prices have to fall. And just one factor that promoted those price heights was the shameless pumping of real estate by local RE hucksters. And self-anointed poster-boy for local RE promoters would be….?
Anyway, that sub-plot aside, let’s look at the current advice Cam is giving:
If you’re Chinese, invest in Vancouver; if you’re a Vancouverite, invest in… Arizona.
Why the inconsistency? With the love for Vancouver, why bother with Arizona?
Is Vancouver in a bubble or is it not? Cam scorns those who ask, but he doesn’t answer the question.
The rest of us all know the answer.
- vreaa
Most Recent Comments:
- 604x on “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.”
- Molasses on “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.”
- James on “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.”
- Nemesis on “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.”
- 4SlicesofCheese on “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.”
- LadyInWaiting on “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.”
- LadyInWaiting on “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.”
- bailinginbc on “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.”
- Real Estate Tsunami on “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.”
- Real Estate Tsunami on “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.”
- LadyInWaiting on “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.”
- Nemesis on “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.”
Type of Anecdote
- 01. He Said, She Said (247)
- 02. Profiting from the Boom (441)
- 03. Changed my Life (103)
- 04. Changed my Career (38)
- 05. Where do Buyers get the money? (958)
- 06. Held my Nose and Leapt (96)
- 07. Avoiding Vancouver (375)
- 08. Overextended Buyers (1183)
- 09. Delaying Buying (315)
- 10. Demoralized Renters? (362)
- 11. Regrets about Investing in RE (417)
- 12. Effects of Development (274)
- 13. 2010 Olympics Related (74)
- 14. Social Effects of the Boom (1256)
- 15. Misallocation of Resources (958)
- 16. Missed The Boat? (236)
- 17. The Froogle Scott Chronicles (27)
- 18. Spot The Speculator (171)
- 19. BlastRadiusPostCards (17)
- 20. The Limitless Demand Argument For Ongoing Market Strength (70)
- 21. Vancouver RE-Verse [Found Poems] (8)
- 22. RE References In Popular Culture (41)
- 23. Jumping The Shark (1)
- 24. Policies On Housing (10)
- 25. Epigrams For The Bubble (1)
- 26. Premature Calls Of "Bottom" (3)
- 27. Seller Panic (3)
- 28. Erroneous Causation Theories For Falling Prices (7)
- 29. Bubblespeak (1)
- 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
- 08 Canada Bubble
- 09 Rob Chipman's blog
- 10 YatterMatters
- 11 condohype [retired; archives available]
- 12 vancouver (un)real estate
- 13 Agent Will's Stats [retired]
- 14 Landlord Rescue
- 15 The Economic Analyst
- 16 Canadian Housing Price Charts
- 17 Hoodsurf [retired Jun 2011]
- 18 World Housing Bubble
- 19 Vancouver Price Drop
- 20 North American Economics
-
Latest Anecdotes:
- “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%.
- Downside Weights On The Vancouver RE Market – “One of the older guys (over 60) mention to the guy beside him that he and his wife were thinking about selling their family home, and renting, in order to get some of the money that was locked up in the house.”
- “My buddy was looking to upgrade to a house in the Coquitlam area. With 200k extra for a home, that’s half of lifetime saving between him and his wife.”
- “I was walking in the Fraser neighborhood yesterday, I noticed that the population, on average, seem to be composed of workers. I belong to the top 5 percent in terms of income. Nevertheless, I cannot afford any of the houses for sale in that neighbourhood.”
- “Vancouver is an urban resort whose value mostly resides in its real estate and not much else.”
- “Rogers Communications is expanding into RE; aiming to relaunch website; providing critical data that can help potential buyers assess the value of a property from the comfort of their home computer.”
- I’m only 50 and I can just about retire if I want to, all because of a single simple decision – “When prices rebounded to their former highs, then rocketed another 30% higher to what I considered to be totally unsustainable levels, I decided that only a fool would pass up a second opportunity to harvest such a massive non-taxable capital gain, and in 2011 I sold my place.”
- The Vacant Lot of Versailles, Richmond.
- “I don’t think that most people think things are going to crash, just that there is going to be a slight correction, but it was amazing to me how sentiment has changed, and the fact Vancouver RE is too high was just understood.”
- “The ‘investor’ who purchased our house put it up for sale two months later, in January 1981, but the bubble had burst.”
- For A City To Have That Kind Of Vacancy, It’s Like Cancer – “Downtown, the vacant unit rate is so high that it’s as though there were 35 towers at 20 storeys apiece – all empty.”
Follow vreaa on twitter
- "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… 1 day ago
VREAArchives
- May 2013
- April 2013
- March 2013
- February 2013
- January 2013
- December 2012
- November 2012
- October 2012
- September 2012
- August 2012
- July 2012
- June 2012
- May 2012
- April 2012
- March 2012
- February 2012
- January 2012
- December 2011
- November 2011
- October 2011
- September 2011
- August 2011
- July 2011
- June 2011
- May 2011
- April 2011
- March 2011
- February 2011
- January 2011
- December 2010
- November 2010
- October 2010
- September 2010
- August 2010
- July 2010
- June 2010
- May 2010
- April 2010
- March 2010
- February 2010
- January 2010
- December 2009
- November 2009
- October 2009
- September 2009
- August 2009
- June 2009
- May 2009
- April 2009
- March 2009
- February 2009
- January 2009
- October 2008
- September 2008
- July 2008
- June 2008
- May 2008
- April 2008
- March 2008
- February 2008
Tags
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
Ship. Rat[s]. Sinking.
PS – Re: “the heights from which prices have to fall” – there is absolutely no truth to the persistent rumours that Mr. Good’s next Sikorsky charter was in imminent danger of an assisted JesusNut ‘failure’.
And for those of you who aren’t familiar with the peculiarities of rotary ‘winged’ aircraft…
http://en.wikipedia.org/wiki/Jesus_nut
(Gulp)
Thanks for the education.
oh my oh my — laughing out loud — brevity is the soul of wit!
Cam Good is puke.
Cam Good is NOT puke. Please don’t give puke a bad name by putting them in the same group as Cam Good. Cam Good is a profiteering scumbag.
I don’t hold it against him that he is getting rich. But the fact that he is doing it at the expense of other peoples’ misery. He’s just a raper and pillager in a fancy suit, and ads in media but has no better sense of ethics than an email scammer.
I have no doubt that he would tear down the last Brazilian rain forest if he could make a tidy profit. Sadly like many business sociopaths he will never see past his own subjective wants and greed.
Absolutely Cam. Because investing in a market that is at or near its low, where good money can be made from rental income, is just like investing in a market that is at or near its high, where money is lost every month through negative cash flow.
“If money can be made on a house sale, whether it be in Arizona or Vancouver, it doesn’t matter whether they have the money to buy it, or where they come from”
Let foreigners buy, fine with me. But let’s ensure that government revenue is collected in the form of a Land Value Tax, not via income and consumption taxes.
“LVT is a tax almost impossible to avoid, while money can income can be moved offshore, land is pretty solidly in one place. As it only taxes value of the land not improvements it should be easier to assess than a property tax that relies on the full value of the land plus improvements. That’s important as for any property tax to be fair, even in it’s own terms, the valuations need to remain up to date. As it charges for the full rental value of the land whether the land is developed or not it encourages efficient use of land, discourages speculation and empty sites and provides a natural impetus for regeneration and against sprawl.”
http://brightgreenscotland.org/index.php/2010/04/why-we-should-be-talking-about-land-value-tax/
In Vancouver, you can do everything right when buying a house and still get burned: http://benry.net/2011/07/26/a-fire-story/
“Unfortunately, speculation is rampant…” By George! He’s hit the nail right on the head!
What surprises me the most is that Scam Good reads VREAA!
We knew that already. One of his ass-istents commented here in the past. And I suspect that certain regular commenters may be affiliated with him too.
By ass-istents who were you referring to? I don’t actually think He reads VREAA. Either way, most of the ‘news’ that is put out there by Cam via the media is a ‘chicken-before-the-egg’ type scenario.
I would be happy to answer any specific questions you have about real numbers behind the scenes though.
So apparently one section of the cambie corrider has been sold out!
The block south of Queen Park has a big sold out sign on it when I was passing by this morning.
Queen Elizabeth Park I meant.
Hey VREAA, a new report links high house prices as the top reason new immigrants have declining health in Vancouver:
http://blogs.vancouversun.com/2012/01/07/why-is-vancouver-bad-for-immigrants-health/
I feel a cough coming on…
I think that high house prices are also a reason why more people seem irritated and unpleasant recently.
Loon -> Great find, thanks for the link. Will headline.
Anecdote alert! (In the Vancouver Sun, none-the-less):
http://www.vancouversun.com/technology/Laptop+hobos+face+crackdown/5959499/story.html
“‘Laptop hobos” may soon pay more for the privilege of Wi-Fi as cafés begin to crack down on users who overstay their welcome.
Free Wi-Fi has become the norm in café culture — even MacDonald’s started offering it this year — but like any real estate bubble, this one may be about to burst.”
EG -> Thanks. Example of RE referenced in other context. Will headline.
don’t know cam good but in the end, of course responsibility is the buyer’s. he sees a market and is facilitating supply to demand for a fee. it’s a service; whether a good one, or worth the price is a separate matter. if successful, he will have competition and that will improve the service.
meanwhile elsewhere, check out what you can get for about $3M in Carmel Valley CA. area is bpoe-worthy.
http://www.jamesburgearthstation.com/
after the fallout, similar situations in vcr and bc will arise on a smaller scale.
Cool array!… But I like mine better [agreed, it's overkill if all you really want is the PlayBoyChannel].
http://tinyurl.com/6nroukm
hahahaha
Was thinking to contract out farmland for grow ops. Build quality good enough for 5 megaton hit – it’s no van special. Structure probably good for a few hundred years.
With a deck like that you can probably discriminate wookie porn. Giggity.
interesting little blurb about comparing US and Vancouver prices and monthly costs.
“Home ownership affordability in the US versus Vancouver: very different stories”
http://blogs.vancouversun.com/2011/12/13/home-ownership-affordability-in-the-us-versus-vancouver-very-different-stories/
If it wasn’t “Chinese” investment it would be something else. BC just needs an excuse to gamble. Cam is the messenger, not the problem.
One passing anecdote, friend has flipped a few condos in Vancouver, now renting in Toronto. Has presales coming due Jan 17, needs to sell because cannot afford neg carry costs on it.
But funny part is her attitude to owning. She is from Vancouver originally and says she cannot bring herself to rent in Vancouver, with her family there. Renting to her would be like a failure. She would rather live at home than rent. For personal reasons she prefers to live away from parents. So in some bizarre fit of logic the only way she can opt for renting is to leave the city. She’s about 24 years old.
Social pressures and bubbles? Yes.
is your friend Asian?
I have a friend in the same situation… they are renting in a different city, but would live at parent’s house or at a condo she owns if she lived in Vancouver.