Mike Shedlock, blogger at ‘Global Economic Trend Analysis’ [3 Mar 2012 2:16pm], consistently rated one of the top financial blogs in the US, writes: “Inquiring minds seeing new data on Vancouver’s massively overpriced real estate just might be seeking new comparisons to other places. First, Let’s take a look at what $890,000+- will buy in Vancouver:”
2119 East 3rd Ave, Vancouver
MLS® Number V934050
Listing Price: $899,500
Description: “This 1 ? story home has been extensively renovated over the last few years. The spacious kitchen has birch cabinets and Soapstone counters and opens to a 20×12′ deck. On this level are 2 B/Rs and a modern 4pce bath. Upstairs has an office/den area, a 4pce bath and a big master B/R with a W/I closet and 12×8 view deck. The bsmt has a 1 B/R suite rented at $960 P.M. and the attached garage has been converted to a workshop with French doors opening to the fenced garden, with B/I bench, a patio and a kid’s sandbox.”
Mish comments “That creative listing puts a new meaning to the the word “upstairs”. Is the number of stories listed at “1?” really in question?”, and then gives two other similar Vancouver examples, one with touted “amazing views”, before continuing:
“With those bargain listings in hand, let’s consider a single property sale that just took place in Ireland. The previous price for the Sandhouse Hotel located in Donegal, Ireland sold at auction was $6 million.”
“Paul Diver has purchased a spectacular 55 bedroom hotel overlooking the Donegal coastline for a mere $860,000, down from the $6 million price the original owners sought for the Sandhouse Hotel three years ago.”– msnbc.com 2 Mar 2012
“There you have it: “amazing views” in Vancouver for $899,000 vs. “amazing views” in Donegal for $860,000.
It is indeed “different” in Canada.” (- Mish)
—
A comparison to make even Vancouver bears feel sheepish.
– vreaa
Vancouver Real Estate Anecdote Archive 
Looks like someone slapped some paint on the Overlook.
Oh Sammy, that hotel is just ghastly. So yellow!
Yes my love, and too close to the beach. All those pigeons and seagulls!
Oh, you agree poopy. Please, don’t buy it then.
Anything for you my sweet dove. We will stay in Vancouver instead.
I love you Sammy.
Oh Look! a rundown shack…..and only 2 million this week.
Sigh.This really is the BPOE
It’s bright yellow so customers can find it in the hazy mist that undoubtedly fills the air the other 364 days of the year other than the one the photographer snapped this on.
But can you ski and golf on the same day in Ireland? No?
Well there you have it, crack shack for $1 mil please.
I’m amazed that while the world is starting to laugh at Vancouver, so few here seem even to know or care that what’s happening is both laughable and (not too strong a word) tragic.
An argument I just made on another thread about why I do see what’s happening as tragic (but not inevitable) has been put “in moderation” for some reason — it had no obscenities in it and while strongly worded was not in my view intemperate. Wish the Fred Filters would not frustrate others! Host, I know there’s not much you can do about this.
[Vesta: Your comment now out of ‘mod’, of course. As you say ‘Fred Filters’; no way around this, sorry. Any regular posters whose comments go into mod queue please understand this, they’ll be released as soon as noticed. -ed.]
It’s tragic but makes for fascinating observance of the human condition.
A little perspective fills my lungs yet I skim over stories of civil wars looking for the “human interest” and interior design pablum in the Homes section of the Sun.
As a human myself I see limited hypocrisy.
“observance of the human condition…As a human myself I see limited hypocrisy.” Quote of the day. After years in advertising I became jaded to the ‘shock and soothe’ endorphin tactics propelling commerce.
This blog is a refreshing salon, similar to the cafes of Vienna or Prague, patrons discussing the social paradigms.
Vienna. Best place to live. Ever. Voted by those who know.
“The spacious kitchen has birch cabinets and Soapstone counters and opens to a 20×12′ deck… French doors opening to the fenced garden, with B/I bench, a patio and a kid’s sandbox” etc.
These Realtors know how to polish a turd, I’ll given em that.
Not that I can afford either, but I would gladly take that hotel any day. And then have every single person I know live there with me, or something crazy like that.
last place on earth you can finance $1M crackshacks. so, when in rome …
80% off for Van is unlikely. Anyone hoping 50% off for a sfh is dreaming. Condos, are a different story. A 50% correction across the board would put us in a deep recession and basically put many out if a job.
Yes, a crash will be very painful.
Not sure how that conclusion becomes the premise for believing that a crash is impossible, though.
Yeah, it’s not like that’s happened in the US…and the PIIG nations, oh wait…and Japan…omg and China. :0
Ha. Good one Sterling.
The thing is, a 50% price decline is not just likely, it is a high probability over a period of say five years. Prices are extreme to say the least but that is only one consideration. As we now know, most of the buying and selling is being done by locals and not so-called hot Asian money.
As this has occurred, families and younger people have been driven out of the market due to it lack of affordability. Vancouver is turning very grey as a result. It is basically an old folks home now…..
and guess what?
Old folks sell to fund retirements. They sell to escape high property tax. They sell due to poor health or to fund their children’s business’s or educations. And they sell to capitalize on opportunity or better yet, to avoid the pain of losing out when markets fall. That same group that has held out for better prices will just as surely be the ones to drive up a surplus on the market and cause a serious price decline. Just look at all the signs sprouting on Granville lately. This spring is going to a huge bust.
Lucky them. They get to list into a falling market and do so during a recession that is a near certainty as an outcome of our credit excess.
Idiots.
A 50% correction would be worse than recessionary, think D word. Nobody is cheering for this. Unfortunately, fundamentals indicate a 60-70% across the board decline is more likely than not.
How many can afford the monthly payments on a $2M mortgage? You need to bring a small fortune, an inheritance maybe, or proceeds from the sale of another property. And what happens to those when prices start falling?
The property penciled in as a notional asset on the balance sheet gets transferred in red ink to the liability column. Asset produces positive cash flow or it never was. Better question, who would spend $2M on an intangible key fob in a high tax environment? A flipper or an self aggrandizing intellectual.
Sterling,
Japan had a 2 year bull run with a 600% increase. The US was about 6 years. Canada is at 10 years. China has not crashed yet, exception of one northern city of Ordos.
why search so far abroad?
Buy this 20 unit motel in Nelson, BC on 2.75 acres with seperate owner’s home for 1.2Million. Check the view on the lake too.
http://canada.businessesforsale.com/canadian/Great-Priced-Motel-And-Home-In-Nelson-BC-For-Sale.aspx
We could do this all day long (and some of you probably will). What’s the point? The value is in the land not the house.
That looks reasonable, with tourist numbers out of Calgary and rvs doing the triangle route. However, I’ll wait til next winter before diving in. Let’s say $399k after this all plays out, maybe less.
The hotel reminds me of the movie “The Shining”…and no I dont want the flipper/crack shack either…but if ur a renter I rather be near a beach 😀
A sandbox? Really, it’s come down to that?
Just thinking… maybe it should read “litter box” as that’s the more likely use.
Yes, I loved that “selling point” too.
There’s absolutely no comparison between those properties. I’m pretty sure that East Van house doesn’t require 50 employees to be paid on time every month.
you must be related to f1. btw, i should disclose that i am attracted to him for his west side detached and family values
Absolutely no comparison. One is cashflow and a writedown. I will give it to you, that East Van petunia shack would look cute when the sun clears neighbors between 1 and 3:00pm.
lol over the ridgeline of the pink/beige/grey stucco monster box with the stone and wrought iron gate wrapping around what were once shared front yards for families to enjoy, etc.
“The bsmt has a 1 B/R suite rented at $960 P.M. ”
Market rate for homestay / foreign students ready to switch to PR-lane in a year or two.
I was looking for info on Toronto’s mad crash in the 90s, when Vancouver was spared the madness. I didn’t have much luck yet, but this “joke” popped up.
“Help needed, rental disaster
I have a client from middle east that have investment property here in toronto. I have rented him condo out to some new to canada immigrants for a lease. Everything fine for first 8 months but 2 days ago i get call about expansive damages to the condo from the board/management.
What happened was that the renters wanted to grow vegetables in the livivng room and put down soil and were watering it. It has now gone through the floor and there is lots of damage they say over 150K? Is it possible and what to tell my client? I am in process to make claim but the renters are not even legal in canada and insurance may not cover.
Any advice will be helpful to me. ”
http://urbantoronto.ca/forum/showthread.php/17805-Help-needed-rental-disaster
A little reminder of why an ETF is a better way to fill out your portfolio with the real estate sector.
Not a fair comparison. The hotel is clearly worth alot more than 890k. Buying a house in distress at an auction is completely different than a regular sale. My parents, who understand how bank auctions and foreclosures work, bought a house in palm springs for 700k. It had sold for 4.5 million 3 years earlier and at the time of purchase was worth in the 2 million dollar range.
yes, this is correct. so, when the distress auctions don’t happen, people won’t be picking up eastvan crackshacks formerly listed 3yrs earlier at $890k for $150k.
If you go on Google Street View you will see that this “crack-shack” sits on a substantial, fenced in, corner lot suitable for a 3 or 4 story condo building with perhaps 30 or more suits. Given the location to Downtown and the nice park and mountain view, the price doesn’t seem all that crazy.
yes, i think you make a very compelling argument. i will relay this message to all post-bubble citizens of the planet (i.e. pretty much everywhere except canada) – that it is different here. i am now most reassured they will stop laughing.
You mean it comes with a 30 unit apartment as well? Ah, well then the price may be not that crazy after all.
pure bubble rationalization
It’s not a corner lot, it’s 3 houses east of the corner, on the north side of the road.
But you’re right, it does have a fence! That’s gotta add an extra $100k for sure.
Knowing Mish, I’m sure he found some way to blame this on the unions. 😉
If you actually look on Google street view you will see that the block consists almost entirely of apartment buildings containing about 50 units each. The subject crack shack really does occupy the far north-eastern corner of a fairly large fenced-in corner lot which probably used to be occupied by two other crack shacks.
FWIW, I anticipate a major correction in prices and believe that some current property prices are more than a bit nutty, however, providing misleading information and hyperbole doesn’t help the bear arguments, leave the distortions to the bulls.
BTW Murdoch, the north side of the road is the side closest to the north shore mountains, it’s a park – no houses. Go to street view and you’ll see an old red Volvo parked in the drive, that’s the subject property.
By all means let’s debate the value of the crack shack’s lot but let’s talk about the large corner lot it occupies. It looks like it could accommodate a fairly substantial condo building and I would guess the earlier guess of fifty suites is a bit low.
Doesn’t matter the size of the lot. Value may be in the land, but if it’s condos, the developer needs 60% presale and the condo market is now in decline. Who’s going to build it? The land becomes a liability. With currency devaluation, we might be back on the gold standard before a fifty unit spread is built. The functional value is in the residence as it stands, unless there’s margin to rebuild a larger rental. At $850k, it’s spec or an expensive shotgun shack. That sound is the trap door on a money pit.
All well and good, but the previous owners fixed it up like a mini barbie play house (as much as it could be) and the realtor is touting it for its livability. If its value is land for an apartment block that only increases the sense of distortion of the ad.
this house at 2119 east 3rd ave just sold in bidding war, above asking at 940K. So it looks like more than 1 person thought this home was a better deal than the hotel in Donegal