“Was at a friend’s wedding last night, with a group of friends. One asked me if I am going to up-size from my current place to a bigger one. I said no, since market is crashing, and gave him most up to date stats -50% in sales compared to last year and -10% in price in last 5 months. Second friend turned around and said that there is no way it’s going to crash in Vancouver, since San Francisco never crashed. I was bit a buzzed from gin and tonic so couldn’t remember exacts stats for San Francisco. Then the first friend jokenly said that second one bought a third property not too long ago and is waiting for it to be built.
At that point I told them that lets not talk about real-state since it’s an emotional topic and I didn’t want to upset anyone, and lets enjoy the wedding.”
- SunBlaster at VCI 29 Jul 2012 10:33pm
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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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According to the NY Times, from the peak (May 2006) to May 2012, prices in SFO are down 42.9%…
http://www.nytimes.com/interactive/2011/05/31/business/economy/case-shiller-index.html#city/SF
Sorry, graph is from May 2011, not May 2012. My bad…
My friend who moved to SanFran around 08, says to me prices never really dropped there and have since risen.
According to Case Shiller data, prices in San Fran were off 46% peak to trough (May 2006 to Feb 09). In most popular US cities, the desirable inner neighborhoods saw less of a decline than outer neighborhoods.
If your friend moved in 2008, especially mid to late-2008, most of the drop would have already been out of the way.
Hard to compare SF to Van. The Bay Area’s work environment is completely different than Van’s. Oracle, Cisco, etc reside there with really good paying jobs. We’re not a Head Office city with average salaries way below SF’s. They can support higher RE prices, it’s a bit more “justified” than Vancouver’s @ $1million – what a joke!
This lack of situational awareness is part of the general financial illiteracy I referred to earlier. The U.S. housing disaster is unfolding, in technicolor, before our very eyes. What should be a valuable heads-up for Canadians is simply brushed aside or, in this case, re-conceived entirely (“San Francisco didn’t crash”). Sorry, no pity for the inevitable pain ahead…
There’s real jobs in the Bay Area with commensurately high income in many fields. Other than Manhattan, you’d actually expect housing to be expensive and remain expensive there. Less can be said for Vancouver.
Is this chart a good indicator?
http://www.jparsons.net/housingbubble/san_francisco.html
Overall SF area includes East Bay, what SunBlaster’s buddy is likely referring to is SF proper and some of the more higher end suburbs. And yes prices have stayed relatively high in those areas, though I don’t know if they’ve risen from their peaks in 2006-2007.
In real terms it looks like they’re off 15-20% from peak: 6 years of flat prices is about 13% off the bat.
People have tried predicting what the Vancouver market would do by comparing it to US markets. That’s a flawed approach, period, full stop. It didn’t work for bears in the past and it doesn’t work for bulls now. I saw a study a few years ago indicating the the city we track most closely is…Chicago.
Traditionally we move counter to Toronto. News of a boom in Toronto makes me think a Vancouver price drop is coming much more than any comparison with any other city scares/reassures me.
“Traditionally we move counter to Toronto. News of a boom in Toronto makes me think a Vancouver price drop is coming”
Looking at the Sauder real growth data, my interpretation would be that what you said was true in the 90s, and possibly as earlier as ’86, but hasn’t been terribly true since 2000.
http://cuer.sauder.ubc.ca/cma/index.html#
The volatility of the 80s and early 90s is striking.
Another difference between SFO and YVR… No golf courses or cemetaries in SFO…
Fascinating. Forgive me, Bo Xilai… but aren’t they the same thing?
No. One is open to the public to allow it to pay its respects, the other is not.
No cemetaries but there are a 1/2-dozen golf courses within SF city proper including the Olympic Country Club where the US Open was just played. Also, the NY TIMES stats for SF house prices are for the entire SF Bay Area which includes many devastated outlying suburbs… in the city of SF proper, the decline has been relatively modest (5-20% depending on the neighbourhood), and lately prices have been going up again, and some neighbourhoods, like Noe Valley, are red hot again (with all that Twitter & Facebook & Google money). I think YVR is where Miami or Las Vegas was in late 2006 standing at the edge of the proverbial cliff… Vancouver is dreadfully overpriced, and unlike the SF Bay Area, doesn’t have many high-paying jobs to support such an inflated property market; instead mostly just speculators which is not a healthy thing. Sorry to say, but Canada (esp. YVR, a city I’m really fond of, BTW) hasn’t learned a thing from the US property crash and is headed for the same disaster. Like the US, it will take you 5-6 years minimum to dig out, possibly a decade, and given the almost absurd run-up in property prices, Van is probably facing a pretty severe drop. Believe me… It’s not different in the BPOE.
Just compare price to rent / income between SF and YVR, and we get an idea of how much we need to drop in YVR. But I would say SF deserves a higher ratio because of its overall higher quality of jobs (tech, healthcare, etc).
Higher incomes mean higher price-income? I’m not following.
SFO has golf courses including the Olympic Club and Golden Gate. Most cemetaries were moved to Colma… which is a creepy place to drive through.
SFO=San Francisco International Airport. But otherwise agree, avoid Colma, do not pass GO, do not collect $200.
Wife is from San Francisco. I have lots of friends there. Rents are sky high right now. The big difference I’ve noticed is that while people there are just happy to get a place to rent in the city, here in Vancouver, people whine that they can’t afford a place here. My in-laws got evicted because their landlord wanted to charge a lot more for their place. Can’t find a 2br for under 3000 bucks in the city now. My mortgage (960K) is only 3200 a month or so on a 3br/3.4 bath on the westside!!
“Can’t find a 2br for under 3000 bucks in the city now. ”
Really where are you looking?? Even brand new units in decent buildings are easily under 3k a month.