“I grew up in two cities, Edmonton and North Vancouver. I was able to accomplish a lot while in the lower mainland, got my bachelor’s, started to work straight from graduation in a great conuslting job, got married, bought an apartment, two beautiful kids arrived to make us a family, got my Master’s degree. We thought we where set…”

“I grew up in two cities, Edmonton and North Vancouver. I left Edmonton when I was 16, and did my young adult life in Vancouver. I was able to accomplish a lot while in the lower mainland, got my bachelor’s, started to work straight from graduation in a great conuslting job, got married, bought an apartment, two beautiful kids arrived to make us a family, got my Master’s degree. We thought we where set – luckiest couple alive to be in such a gorgeous city and our careers where thriving. THEN it hit – buckled to our knees trying to pay for one child in day care while my wife returned to work, then our baby girl arrived and it was impossible to explain the logic of my wife returning to work and then just hand that money over to a child care provider. So she stayed home and we started to bleed money. Contract work was great when your fending for yourself, now with a family – contract work not so great and then it starting to not become full time anymore, cuts were happening, job not so secure anymore. Groceries, Mortgage, One Vehicle, One Income, No Benefits, No Savings – I started to have restless nights.

So I told my wife, no worries, I will start aiming higher, I have my Master’s, I’m proficient in French, I’m fluent in Spanish, it will be easy to find a job to plug some of the holes. Maybe we can even talk to the bank see if they will let us renew early to take advantage of low interest rates (HA! that was naive!) ONE YEAR AND SEVERAL APPLICATIONS LATER – nothing, nada, zilch. Meanwhile the signal was clear from my current work, contracts are dwindling you need to get out while you can.

We were down for the count. So August 2011 I applied to two jobs in Edmonton, by the end of month I was flown in for interviews, by September 2011 I had a job offer, by November 2011 we where sleeping in our rented townhome in Edmonton. Just like that in a matter of weeks Edmonton could do what I wished and hoped Vancouver could do for almost two years.

I have heard from a colleague that one of the consultants I worked with had become so desperate she took a job as a receptionist even though she has 8 years of professional work experience and a Master’s degree. What the hell is going on Vancouver?

Employers know they have a desirable city and a huge job bank from which to pick so no need to overpay… make ‘em work for pennies. Great Captalism not so great community building.

The younger generations are leaving, what will Vancouver do when it can’t draw them back?”

- bdiddy18 at Anabelle’s Blog, 11 Apr 2012

“So long Vancouver! Adieu! It’s been nice, but now I feel like a young naïve girl who’s been tricked into having sex with a pretty but vapid jock. How many smart, motivated young people must you scare out with your over-inflated prices and lack of joy before you realize that you are headed to an economic and human disaster?”

“So long Vancouver! Adieu! It’s been nice, but now I feel like a young naïve girl who’s been tricked into having sex with a pretty but vapid jock.”

…
Disappointing thing #1: The job market …
There are no jobs here, and when a good one pops up, the competition is so fierce that you have to send a singing telegram to get noticed.
…
Disappointing thing #2: The cost of living …
How many people must cram into a 1500$/month 2-bedroom apartment just to make ends meet? “Why aren’t they moving somewhere cheaper?” you ask. Well, there isn’t anything cheaper. Well, actually, there is, but the cheaper stuff is often illegal, unsafe and unhealthy.
…
Disappointing thing #3: The heart …
The city has, how can I explain it… no soul. It is as superficial and empty as the endless condo towers growing like weeds. There are good people in Vancouver who give this city some spark and light; but most times I felt no joie de vivre, no… happiness. Everyone is working so hard to maintain the appearance of being affluent that they lose their souls in the process. They lose their ability to enjoy life. And what good is a city surrounded by nature if you can’t find it in your heart to enjoy it to its fullest because you are worried about bills all the time?
…
Conclusion …
I used to love Vancouver as a tourist… but staying there made me hate it. How many smart, motivated young people must you scare out with your over-inflated prices and lack of joy before you realize that you are headed to an economic and human disaster, Vancouver?
…
- excerpts from “Don’t Move to Vancouver”: Why I Changed My Mind After 6 Months”, by Anabelle, at her blog ‘Anabelle’s Blog’, 18 Mar 2012 [Hat-tip Aldus Huxtable]

“My wife’s sister and husband are both software developers with masters degrees and they moved back to Ontario last year to raise a family as real estate prices became too much for them.”

“My wife’s sister and husband are both software developers with masters degrees and they moved back to Ontario last year to raise a family as real estate prices became too much for them.”
- George, first time poster, at VREAA 5 Apr 2012 10:02am

Vancouver Courier Letter Of The Week – “My husband has an excellent job in finance with a great salary we continue to rent little bungalows on the West Side that sell for ridiculous prices. Sadly Vancouver has become our enemy rather than our friend. Every day we discuss leaving.”

‘reality check’, in a comment on these pages, pointed us to the following letter in the Vancouver Courier, with the remark:
“There is a nice whiney letter in yesterday Courier, VREAA, stating how a poor family of 3 who deserves to live on the west side is looking at leaving the province. BOO HOO. I thought you’d enjoy reading it.”

—
Letter of the week
Vancouver Courier APRIL 6, 2012

“To the editor:

Re: “Vancouver realtors cater to wealthy offshore Chinese as middle class gets squeezed,” vancourier.com, April 3.

It’s about time that this major problem be discussed. My husband and I are increasingly frustrated with what is going on in the city and although my husband has an excellent job in finance with a great salary we continue to rent little bungalows on the West Side that sell for ridiculous prices ($2 million or more) to Chinese investor class citizens.

We watch our previous rentals get torn down so that another huge empty house can take its place. It’s heartbreaking and the fact that we have a daughter who is two years old makes the situation more frustrating because we can’t provide a stable situation-a small house, near a good school in a safe neighbourhood. We watch as our trust-fund friends buy on the East Side paying crazy prices to live in houses that need a lot of work in less than perfect neighbourhoods.

We are on our own financially, so sadly Vancouver has become our enemy rather than our friend. Every day we discuss leaving. Our job search in other parts of the nation continues because we are getting the message loud and clear- Vancouver doesn’t want us here.

Sad but true.

Rebecca Kovacs, Vancouver”

“Garassino has actively discouraged her own kids from waiting around to find out how it unfolds” – “I tell my kids to go out and seek their fortune elsewhere. You can’t do it here. These are kids that could build Vancouver. They’re educated, ambitious and entrepreneurial, and they don’t think that Vancouver represents opportunity for them.”

“It’s not that Baroldi fell flat on her face when she moved to Vancouver. She found work, made friends and started to build a new life for herself. But she also didn’t feel like she was making enough meaningful progress in her life — instead, like so many other people her age, she was just effectively treading water. Vancouver, she says, is probably a wonderful place to be 20. But, as she discovered, people’s priorities change at 30, which is part of the reason she moved back to Edmonton late last year. “As soon as people hit 30, they run into a wall,” Baroldi says. “They have different life goals. While they can be achieved in Vancouver, they can’t be achieved as easily.”
–
“For those who do need to make a living, Vancouver is just about the furthest thing from livable. That’s a direct result of the city’s turbo-charged real-estate market. It wasn’t that long ago that middle-class families could afford to buy middle-class homes in Vancouver-proper without selling their children into slavery, but those days are long gone. According to Royal LePage, the price of an average detached home reached $1,017,500 in the fourth quarter of 2011. Meanwhile, Vancouver real estate team Faith Wilson Group says the price tag on a place located on the west side of the city hit a staggering $1,656,986. The average price of a condominium, on the other hand, was $536,500 — more than $200,000 higher than the average price of a house in Edmonton.”
–
“Eventually, something’s going to have to give — that is, if it isn’t giving already. That’s the message that Sandy Garossino, a Vancouver-born (and Alberta-raised) lawyer and business owner, spent the recent Vancouver civic election trying to spread as an independent candidate. She contends that while there has been plenty of talk about the negative impact of the recently implemented and more recently rejected harmonized sales tax, it’s the city’s real-estate market that’s doing the real damage to local business. “I have two concerns: That we’re in a housing bubble, or that we’re not.”
Either way, she’s actively discouraged her own kids from waiting around to find out how it unfolds. “I tell my kids to go out and seek their fortune elsewhere,” she says. “You can’t do it here.”
In fact, Garossino thinks that this exodus of young talent is the biggest cost associated with Vancouver’s real-estate mania. “These are kids that could build Vancouver. They’re educated, ambitious and entrepreneurial, and they don’t think that Vancouver represents opportunity for them.”
–
The Vancouver Foundation, an organization which works with all communities in the city, asked a wide range of people what they thought Vancouver’s biggest problems were, and it expected to find the usual suspects — homelessness, urban poverty and a lack of affordable housing — at the top of the list. Instead, it heard something quite different from Vancouverites: They felt isolated and alienated, and that they didn’t like it.
–
- excerpts and image from ‘Paradise Found’, by Max Fawcett, avenueedmonton.com, 3 Apr 2012. The article deals with Edmontonian ex-pats returning from Vancouver, and the deleterious effects of RE prices on Vancouver communities. [Perhaps rather 'Paradise Regained'? -ed.]
—

The most profound negative effect of the speculative mania in Vancouver RE has been the severe misallocation of human capital.
- vreaa

“My wife and I both work in healthcare in Vancouver. We are currently experiencing a flood of applications from our local talent, the USA, and around the world. I know it doesn’t fit with the “message” on this blog, but this is the true reality.”

“My wife and I both work in healthcare, both here in Vancouver, PHSA and VCH. We are currently experiencing a flood of applications from our local talent, the USA (especially), and around the world. It is a very competitive hiring environment. Local nursing schools are producing far too many graduates and few have employment offers upon graduation. My wife tells me that many of our medical school graduates are also having trouble. But please, don’t take my word for it, simply look at the career websites at each of our health regions and you will see very few postings. And though we only have 4 degrees between us, we know of what we speak. My wife was recently part of a team recruiting for a new pediatrician at the Children’s, MANY applicants, hired a physician from Johns Hopkins. Hey, I know it doesn’t fit with the “message” on this blog, but this is the true reality.”
- allen at VREAA 27 Mar 2012 9:27am, responding to a post from ‘Vancouver in Rearview’ claiming that “Recruitment to Vancouver for skilled health professionals is nearly impossible.” [VREAA 27 Mar 2012].

Interesting, as we have two different health care ‘insiders’ describing very different recruitment conditions. Perhaps they are looking at different subgroups within the field?
—
With regard to allen’s comment on “message”: At VREAA we welcome any form of personal anecdote pertaining to Vancouver RE, regardless of what ‘message’ it may seem to project.
Even though we are personally very bearish regarding Vancouver RE, we hold our opinion because of the available data, including accumulated anecdotes.
So, we invite you to submit any personal stories that shed light on what is happening in the market, regardless of your opinion regarding future market direction. In fact, we come across so few ‘bullish’ stories, we’d particularly like to hear any of those.
- vreaa

“Recruitment to Vancouver for skilled health professionals is nearly impossible. I’m leaving, too.”

“I work for/with a large health organization in the lower mainland. Here is the bottom line:
Recruitment to Vancouver for skilled health professionals is nearly impossible. For very skilled, technical, health professions, out-of-city recruitment just doesn’t happen. If they don’t already live here, they aren’t coming. They can make more money ($5-$7/hour more, depending on the profession) in Alberta, with housing costs way lower to live in Edmonton or Calgary. For people with families and/or student loans, Vancouver is a non-starter. Our pay here is relatively low compared to other jurisdictions, and our cost of living is enormous. Plus, our employment scene really isn’t that great here for spouses – yes, there are jobs, but the professional ranks here are pretty thin. We don’t build stuff in Vancouver – in fact, I don’t know *what* it is we actually do here!
Yes, Vancouver is a pretty city with water and trees and mountains, but guess what – you can’t eat the scenery and more young families (the ones you want to recruit for the long haul) do the math and say ‘better value elsewhere’.
I’m leaving too – just got back from a weekend in Seattle and my wife and I said “and why do we stay in Vancouver?” We have five university degrees (three Bachelors, two Masters, one PhD in progress – in health sciences and engineering, in case you were wondering) and we can’t wait to pull the pin to move to a place where we can have a house of our own and be around people that do more than just talk about real estate.
As an aside, the bigger problem with real estate in this city is that it has turned the culture into one where everyone wants to be rich, without actually doing anything. Go to a city where people care about actually doing real work, creating value, building things….wow – what a difference in energy! More than anything, that is what Vancouver lacks, and unless that attitude changes, Vancouver will be condemned to also-ran economic status and will continue its status as an economic and cultural backwater.”
- ‘Vancouver in the Rearview’ at VREAA 25 Mar 2012 12:01pm

“I graduated from high school in this city in 1980 and out of the 300 members of my grad class no more than 25 of them now own a house in the neighborhood we grew up in. We are not all stupid and lazy.”

“I graduated from high school in this city in 1980 and out of the 300 or so members of my grad class I would say that no more than 20 or 25 of them now own a house in the neighborhood we grew up in.
We are not all stupid and lazy.
The laughable irony is that at the 30th high school reunion that almost all of the people present came from other areas of the Lower Mainland for the reunion.
One guy I know from my class who is a lawyer mentioned to me one day that he could never afford the house he grew up in, and his father now retired was a blue collar tradesman.
For him to ever get near the old neighborhood, well, someone’s gotta die first.
In fact that is exactly how some of my classmates are now moving back to the area they grew up in, but none of them will admit to that.
It’s just a big coincidence that they move back a few months after someone kicks off.
The guts of the middle class in this city have been ripped right out of it.
I know at least 18 people who have left Vancouver simply because they realized at some point that they were NEVER going to own a house here, and spending the rest of their lives in a over mortgaged rabbit hutch was not acceptable.
Many of them are now in Alberta.
I have read that 55,000 people under the age of 45 have left Vancouver.
Vancouver is the most over rated city on earth.
Like a Hollywood movie set where the street scene looks real, if you step behind the facade of the Vancouver illusion then things here are really quite ugly.
There are a lot of serious social problems in this city that no one wants to admit exist because the Vancouver illusion must be maintained at all costs.”
- John H at greaterfool.ca 23 Mar 2012 11:05pm

“Ryan and Laura Cain wanted three children. Despite having great jobs, the surgeon and physiotherapist say they couldn’t afford to stay in Vancouver.”

Announcer1: “The high cost of real estate in this province isn’t just an annoyance anymore, it’s life altering, quite literally” …
Announcer2: “Ryan and Laura Cain always knew that they wanted three children, but the decision to raise a family came with a compromise. Despite having great jobs, the surgeon and physiotherapist say they couldn’t afford to stay in Vancouver.”

Laura Cain: “We’re lucky enough that my husband’s work allowed us to actually move out of Vancouver because the housing was so expensive here and now in Cranbrook and there housing prices (are) much more affordable.”

Dr Ryan Cain: “You know, as a young surgeon starting out here the cost of living is something to consider. In the Kootenays its a little bit different and I’d certainly say you get a lot more for your dollar.”
—

Dr Paul Kershaw, UBC Early Learning Partnership : “You may be making six figures and still be having a mortgage of $600K for 700sqft and then you’re thinking about how do I have a couple of kids on my balcony?”

Announcer: “According to StatsCan, BC has the lowest fertility rate in the country, with more women giving birth over forty than any other province. In Canada they are also having fewer children than in other major Canadian cities.”

Kershaw: “Incomes have stalled for young families… they’ve actually dipped in BC.. and people have to pay for housing prices in BC that has gone up 149%”

- from Global TV News, 21 Mar 2012

[hat-tip Liggsie, Greenhorn, others]

Comment:
The speculative mania in housing is applying pressure on sensible people to leave Vancouver; this is bad for our city.
- vreaa

Video:

“What has changed are expectations. They feel that the proximity to a really good Ethiopian restaurant should be the natural order of things.”

‘The Vancouver real estate market continues to soar.’

“When I moved to Vancouver 36 years ago, I blanched at the cost of housing. Buying a home inside the city was impossible.
It was marginally less so when my wife and I got married. But the houses we looked at came with big prices and small promise.
We had a family to raise. We moved to the suburbs.
We rented for eight years, raising our three kids in that time. It was only with the help of my in-laws that we could afford our first house, and then only after cashing in all our assets, including all our RRSPs. Then we borrowed big from the bank.
Ours was a typical middle-class story, and still is: help from the parents, an outward move, a mortgage.
And then as now, Vancouver’s real estate was unaffordable. Nothing in that regard has changed.”

“What has changed are expectations. There are those who feel that the lack of cheap housing in Vancouver is an abomination. They feel that the convenience of a short commute or the proximity to a really good Ethiopian restaurant should be the natural order of things.
That feeling is often expressed in tandem with a loathing for the suburbs, and for the cultural vacuum that, for them, the suburbs represent.
What has also changed is that these feelings have been politicized. They are now an Issue; witness the Mayor’s Task Force on Housing Affordability. And as an Issue, reasons that are ostensibly sociological in nature have been made to propel it.
Such as:
Affordable housing makes for healthier neighbourhoods. Affordable housing makes for more diversity. Affordable housing provides housing for middle-class families with children.
These reasons, it should be said, are also urban-centric.
That is, they continue to make the distinction between urban and suburban, as if the “real” city stops at the Vancouver border and the rest is overflow.”

“But that doesn’t apply any more, especially here. More than three-quarters of Metro Vancouver’s population growth is now taking place outside of Vancouver proper, and with that population growth has come more jobs and businesses than Vancouver has been able to produce lately.
It has also rejuvenated once-moribund suburban neighbourhoods. Even in my own neighbourhood in Delta, scores of young families have moved in, bought old-stock housing and updated it. Those young families have also brought with them more cosmopolitan tastes. The suburbs are filling up, and feeling less and less suburban with each passing year.
Conversely, in many respects, the city of Vancouver is feeling more and more like the suburbs. There’s been a steady conversion of industrial land into housing. The major growth in the downtown core has been in condominium construction. And the central political issue preoccupying Vancouverites is not jobs or taxes. It’s housing — the tension between densification and affordability. Vancouver has become its own bedroom community.”

“Vancouver, of course, will always be the centre of things in the Metro area. It has history and critical mass on its side.
And by its very nature, it is going to attract people who want to come here and live in the city.
But should that be a concern of government? Should there even be a task force? And can it have any effect on affordability?
I doubt it: without government subsidies, the market will propel any kind of property here into the stratosphere.”

“But task force member Michael Geller, who is both a developer and an adjunct professor with Simon Fraser University’s Centre for Sustainable Community Development, believes the task force could usher in a greater selection of housing types than what Vancouver has now.
“One of the more affordable forms of housing being built in Toronto, for example,” Geller said, “is stacked townhomes — a two-storey townhouse being built above another.”
Those Toronto townhouses, Geller said, start at $309,000. In Vancouver, Geller admits, they would be much more.
“There’s nothing that this task force can do to make Vancouver as inexpensive as Toronto or Edmonton. But I do believe it will mean changes in the processing of building permits, and in the wording of zoning bylaws that ultimately will lead to increased competition and more affordable housing choices.”
It would also mean densification.
Geller thinks there is an appetite for it; I’m not so sure.
University of B.C. professor Tsur Somerville, director of UBC’s Centre for Urban Economics and Real Estate, agreed with Geller that the task force could give rise to new forms of housing.
“But I haven’t seen anything,” Somerville said, “that won’t anger the neighbourhoods of the city that don’t want densification.”
As for affordability:
“The only thing that’s going to make housing in Vancouver cheaper,” he said, “is a collapse in housing prices.”
Hands up, you well-meaning social engineers, who want that.”

- this is the entire article from ‘McMartin: Affordable housing in Vancouver? Why bother?’, ‘Short commutes and easy access to an Ethiopian restaurant are not the natural order of things’, Peter McMartin, Vancouver Sun, 22 Mar 2012 [hat-tip space889]
—
This is yet another ‘straw-man’ opinion/column/argument.
To re-iterate: No credible critic or commentator that we are aware of is asking for anything for nothing.
People are pointing to the outrageous prices that are the product of a massive speculative mania in housing, and are saying that they aren’t prepared to overextend themselves for the ‘luxury’ of owning in this city.
They are not asking for free or cheap accommodation.
They are pointing to the dire social consequences of a housing bubble; to people leaving the city; to important professions avoiding it in the first place; to the social fabric being sorely tested by the misallocation of human resources that comes with a giant speculative mania.
It is not that ‘expectations’ have changed, it is that prices have ballooned disproportionately to any underlying fundamentals. Sommerville wasn’t making a serious prediction when he is quoted as saying that “a collapse in housing prices” would make housing in Vancouver cheaper, but this quip will turn out to be correct. What “social-engineers” may want is beside the point, what we’re going to get is a housing price implosion, regardless of policy.
By the way, we’d guess that the price:income housing ratios in Vancouver were very substantially lower for Peter McMartin 36 years ago, the ones he baulked at, than they are today. Exact numbers for 1976, anybody? We do know that the ratio has doubled in ten years, from 5.4 in 2001 to 11 in 2011 (source: BMO, 2011).
And the bit about “Ethiopian Restaurants” is an insult to all of those who have serious concerns about the Vancouver housing situation: It aims to make anybody with criticism of price levels appear elitist, and irrelevant, and silly; as if concern about housing prices is equivalent to wanting access to esoteric things like fancy exotic restaurants.
- vreaa
—

- BMO, 2011

- theeconomicanalyst.com
—

Afterimage:

‘Sun columnist Pete McMartin gets a mud-pack at a spa. And loves it.’
- Vancouver Sun, 5 Jan 2010, the third item that comes up when you google: “peter mcmartin” vancouver.

“All my doctor colleagues think I’m nuts to continue renting, but quite frankly, if I get a big fat mortgage and a nice fancy “doctor house”, I won’t be able to retire.”

This personal account from Tina, a doctor making $350K pa living in Vancouver Westside in a $3Million house that she and her husband rent for $4K per month (as featured by Garth Turner at greaterfool.ca 16 Mar 2012):
“I had anger and bitterness towards the unaffordable market. Last year, I was one of those “house horny” individuals looking to get into the market. After losing out on 4 bidding wars and building up a hatred for lying, arrogant RE agents on the Westside, my husband and I decided to stop looking. It was ruining our lives! I didn’t know who was on the other side of the bidding wars but whether or not it was an Asian immigrant with a million cash or some other crazy westsider like me, it didn’t matter. Thank goodness we found greaterfool.ca. For those who comment on the fact that prices are not dropping, maybe they need to see the daily “red sheet” for the Westside that I still receive every day.
As a physician that earns approx $350k per year, this rent is affordable and still allows us to save, invest and be able to retire in 25 years. But the discrepancy in what I can rent compared to what it would cost me to buy the same house is huge! Of course all my doctor colleagues think I’m nuts to continue renting, but quite frankly Garth, if I get a big fat mortgage and a nice fancy “doctor house” as I like to call it, I won’t be able to retire….”

And the following in the comment section from another MD:
“My wife and I are happily in a similar situation. Only one other colleague that I know of in my age cohort is renting. Numerous others have large mortgages. Our department is having a very hard time recruiting because new MDs cannot afford housing in Vancouver.”
- Burnt Norton, greaterfool.ca, 16 Mar 2012 10:05pm
–

Sensible doctors can’t buy “doctor-houses” in Vancouver.
Vancouverites may not realize this, but this is a problem.
There is pressure on doctors to simply move to places where they can buy accommodations of a standard commensurate with their earning ability.
(And don’t anyone volunteer that they could easily buy a townhome in East Van with that kind of income. That is entirely missing the point.)
- vreaa

Tale Of Two Characters – Van East and Frank Lloyd Wright

In relation to a post regarding the sale of the above Van East SFH for $1.45M, commenters were debating what constitutes a ‘character’ home. The example below care of ‘FML Listings‘ (a Toronto RE blog). We’d say this was a character home:

Thomas H. Gale House, Oak Park(West Chicago), Illinois
Architect: Frank Lloyd Wright
Built: 1892
Asking price: $1,295,000
HOUSE HISTORY: Wright’s design for this house was derived from the more expensive residence he had designed earlier in 1892 for Robert Emmond of LaGrange, Illinois. This home and its twin, the Robert Parker house, were built later that same year by Realtor Thomas Gale.
The Gale and Parker Houses are of interest for what they reveal about Wright’s development as an architect. Their irregular composition, consisting of octagonal bays joined to a rectangular core, the whole covered by high-pitched roofs with octagonal dormers, reflect the style of design of Wright’s first teacher, Joseph Silsbee. The influence of Louis Sullivan, especially his philosophy of “geometric simplification”, is seen in the taut masses of these houses, made clear when contrasted with the more ample rounded forms of true Queen Anne designs so popular at that time.
The Thomas Gale house has been completely restored and updated. A new ‘off footprint’ addition include an expanded kitchen and master bathroom, each designed to blend into Wright’s original design.
–

There you have it.
Frank Lloyd Wright in Chicago: $1.3M
Van East SFH: $1.45M
- vreaa

Out-migration – “It’s simply not worth it to pay a million dollars for a dump to live in the rain and act like the only thing in the world is Canucks games, hating Americans, doing the grind and Starbucks.”

“Just about any professional with ambition considers moving to the US at some point based on my experience.”
- Airedales at VREAA 11 Mar 2012 7:08pm

“That’s what I did. BA, B.Sc MBA, UBC. Old friends from high school went right down to the USA became surgeons and live in real world class cities (NYC) and aren’t coming back. They only people left in BC, are slum lords or at literally the same job for 20 years selling appliances in a department store and getting older. Others teach at the same BC high school they went to and their kids are now going to. Some went to Toronto and rest went to Europe. It’s simply not worth it to pay a million dollars for a dump to live in the rain act like the only thing in the world is Canucks games, hating Americans, doing the grind and Starbucks. Most of the time you can’t even see the so called scenery. I bought years ago and sold all my properties.”
- Ed at VREAA 11 Mar 2012 9:29pm

“We live in Vancouver and frequent Seattle often. We look at real estate at times when we travel there. We see median prices nearly triple here in Vancouver over what they are in Seattle. It just doesn’t make any sense.”

“We live in Vancouver and frequent Seattle often. We look at real estate at times when we travel there. Although the median price may show $320,000 in Seattle you would be hard pressed to find anything for that price there unless it were a dump. Surely this figure is comprised of the many studio and one bedroom sales and is not a sole reflection of single family home prices only. To get a decent single family home anywhere in Seattle in a decent neighbourhood would easily cost upward of $500,000-$600,000.

Besides the numbers the graphs comparing Vancouver to Seattle are very concerning to us. We were lucky and sold our downtown Vancouver condo a year ago this March 15th. We took a $17,000 hit after fees. But we felt blessed to get out even though we lost a little cash on the deal. We look around now and it seems like nothing is selling downtown – nothing. We know the real estate downturn has arrived.

If we could find viable jobs in Seattle we would quickly move there. Compared to Vancouver the prices of real estate are much less there and so are the prices for most goods, services, and entertainment. Our quality of life would benefit in ways we cannot imagine here. Aside from the lack of a widespread rail system Seattle as a city is top notch and the people are great too. But getting around in a car is much easier in Seattle than in Vancouver. Tit for tat. I hear they are working on a comprehensive citywide rail system right now and also maybe even getting high speed rail connecting Seattle to Portland. But they are also building a trolly system too such as the one they have in Amsterdam. As an example they are building a brand new waterfront and it looks like it is going to be unlike anything anyone has ever seen. We enjoy living in Vancouver but this city is getting just too expensive for everything. My point is Seattle seems like it is putting money into its services and parks and we just keep building glass towers without care to how it affects living everyday.

Why pay more here when we could potentially live in a sister city that has so much more to offer? Seattle also has its amazing restaurants, we find it to have nicer and better shopping, without a doubt a better art and music scene, large parks, and bohemian culture. Not to mention it is a beautiful skyline and the architecture is not monotones. Overall we love it there and we would venture to say it is actually a much nicer city than Vancouver especially when you take a tour of it on foot.

So when we see median prices nearly triple here in Vancouver over what they are in Seattle then we know we are going to get nailed here in a crunch. It just doesn’t make any sense and most anyone of our friends would agree living in Seattle is a nicer experience in general. Personally we think all the hype as being the Best Place on Earth is nothing more than a ploy to make us all feel good about the ridiculous debt levels we now somehow stumbled upon. Anyone who believes it is the Best Place on Earth here needs to travel more frequently. You do not even need to get off the continent to know differently. All you need to do is drive two and one half hours South.”

- JoeJoe Bee at greaterfool.ca 9 Mar 2012 at 10:14pm

—
Funny I just had a conversation with a co-worker about this same topic and came to the exact same conclusion. Seattle and to add Portland have way more going for them than Vancouver. They have a soul….a vibe…sense of community which you can feel. Vancouver although now much more diverse lost this decades ago…

- vanlocal at greaterfool.ca 9 Mar 2012 11:50pm

What Would You Pay For This House?

“This three-bedroom Craftsman was built in 1922 and retains its original hardwood floors and crown molding. The living room has a wood-burning brick fireplace.
The dining room features original hutches and shelves.
The kitchen, which opens onto a back deck, was completely renovated with the addition of new wooden cabinets and floors, lighting fixtures and stainless-steel appliances.
The master bedroom is on the main level; there are two bedrooms upstairs, where there’s also a family room that opens to a balcony.
Behind the house, there’s a sitting area with a pergola, a few garden beds and a concrete patio.”

Reveal:
The house is on the market in Seattle for $499K.
- ‘What You Get for … $499,000.’, New York Times, 29 Feb 2012; Photos
[hat-tip Vesta]

More on the property:

SIZE: 2,460 square feet
PRICE PER SQUARE FOOT: $202.85
SETTING: This house is in the North Admiral neighborhood in the western part of Seattle on a small peninsula between Elliott Bay and the Puget Sound. The architecture includes Tudors, Dutch Colonials, Victorians and Craftsmans; more contemporary houses dot nearby bluffs and have better views of the city skyline, the bay and the sound.
Three blocks away is the neighborhood’s commercial strip, California Avenue, which has bars, banks, cafes, restaurants, grocers and the Admiral Theater, a 1942 Art Deco movie theater and concert hall. Several parks are within a mile, including the 53-acre Schmitz Preserve Park with its old growth forest and walking paths, Alki Beach Park and Hamilton Viewpoint, which overlooks Elliott Bay and the city skyline.
The house is five and a half miles from downtown.
INSIDE: The two-story house was built in 1922 and renovated within the last four years. It has retained the original hardwood floors, crown molding, and built-in hutches in the dining room. On the first floor, there’s a living room with a wood-burning brick fireplace, a formal dining room, a kitchen and a master bedroom. The kitchen, which opens onto a back deck, was completely renovated with the addition of wooden cabinets and floors, lighting fixtures and stainless-steel appliances. The carpeted second floor has two bedrooms and a family room that opens to a balcony. One of the house’s dormers was finished with drywall and shelves to make a small playroom.
OUTDOOR SPACE: There’s a small fenced-in front yard. Behind the house is a sitting area with a pergola, a few garden beds and a concrete patio.

All sounds very reasonable, by Vancouver standards.
Houses like these will likely sell for even less at Seattle’s bottom, perhaps below $400K.
In Vancouver? Definitely far below the $1.5+M that such a property would now be asking on the West-side.
$500K would represent 66% off. Hmmm. That could never happen, surely?
- vreaa

Laughing Stock – “Inquiring minds seeing new data on Vancouver’s massively overpriced real estate just might be seeking new comparisons to other places.”

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

Intense Disillusionment – “This place is a dump. Absolutely. I can’t wait to go back to California. I don’t think I will ever come to live here, even if RE crashed by 60%. The grass is greener on the other side, really.”

“I am back in Vancouver from California today to take care of some more moving out business.
It feels like the permafrost here, pouring rain, traffic jams everywhere you go, and the teachers are on strike…Hahaaa!
I am supposed to be here for a week but I feel like going back tomorrow.
This place looks and feels like the @hole of the world on a rainy day. And it rains forever.
Moving to California seems to be going smoothly, got my social insurance number, had to get my drivers licence and found a nice rental house with swimming pool for $2000 / month. Car insurance is about 35% cheaper than what I pay here and private healthcare insurance costs me $430/month for a family of 4. I have yet to try it to see how efficient it is compared to the 6 month wait for a CT scan in BC.
Like it or not, sunshine brings a completely new dimension to quality of life. I only regret that I did not leave before.
This place is a dump. Absolutely.
I can’t wait to go back to California. I don’t think I will ever come to live here, even if RE crashed by 60%. The grass is greener on the other side, really.”
…
“Real estate is still expensive here, I agree. But here is a house about 1 mile from where I live selling for $1.3m.”

7209 Sanderling Ct, Carlsbad, CA 92011, 3700sqft SFH, $1.38M

“Compare that with almost any house in Vancouver selling for $1.5m.
And the saddest part is that the idiocy and pain will continue in Vancouver for a long time until the city is completely stripped of its character (whatever is left) and middle class. Those things don’t happen overnight, it takes time for people to notice it on a daily basis.”
- paradox at VCI 2 Mar 2012 5:29pm & 8:13pm

“Dude, the economic freak show is now a big *part* of the city’s character. Come to Vancouver to see 18 year olds racing Maseratis and welfare moms living in 2 million dollar shacks. The guy collecting pop cans is a millionaire. It rains all the time and people say its great. Both newspapers and the main tv channel assure us this is paradise, and you should be happy paying a lifetime’s worth of earnings or even more to live in a coffin with a kitchenette. And people walk around repeating this shit like they have brain-slugs attached to their heads. BPOE!”
- rp1 at VCI 2 Mar 2012 11:18pm

—-

Some strong words. These posts recorded here because they do reflect the degree of disillusionment that some are experiencing.
We’d agree that there are many fine places to live, but we also believe that Vancouver is still one of those fine places.
Vancouver RE is, however, very, very overvalued, and this is crippling the city. We are locked in a speculative mania. Housing would have to drop 50%-66% for it to be even vaguely competitively priced, when compared to viable alternatives. And even after such drops it would still carry a ‘Vancouver premium’.
Until prices revert, osmotic pressure will force many sensible folks away.
This pressure is profoundly deleterious for Vancouver and the area.
Take a look at this post at Mike Shedlock’s very popular US-based ‘Global Economic Analyst’ blog, comparing East Van $900K SFHs with what the same gets you in Ireland. It’s beyond bizarre. As Mish says “It is indeed “different” in Canada.” (We’ll headline his article later).
- vreaa

Vancouverite In Ontario – “My part-time, contract job (1 day per week) pays an annual income almost equal to the average annual income in BC and my house costs one fifth of the average Vancouver home price.”

“We used to live in Vancouver. Moved back to Ontario a few years ago. My part-time, contract job (1 day per week) pays an annual income almost equal to the average annual income in BC and my house costs one fifth of the average Vancouver home price. A similar job in BC would pay me 1/2 of what I earn in Ontario! We have a beautiful century home just north of Toronto that doesn’t require repairs. When home owners spend an average of 90% of their pre-tax income on their primary dwelling, it’s only a matter of time before the cracks appear – and that’s not even factoring in a marginal rise in interest rates and other inflationary pressures. Using intuition alone, I don’t know how this “system of wealth” can continue in Vancouver. Maybe its time to make money the old fashioned way and actually invest in retirement plans. There’s a reason why the feds are strongly encouraging Canadians to reduce their debt burdens.”
- paul at VREAA 23 Feb 2012 6:14am

“A high Canadian dollar and an extremely high cost of housing combine to make me less competitive than my counterparts in the US. Housing prices must come down to ensure that Canada is still competitive on the international stage.”

“My concern about this continuing decrease in the US house market is that it appears to be setting them up for an increase in business. My job here in Canada could very well be done by an American faciliy within our own company, and now the US is releasing information that only seems to confirm that their economy is starting to finally grow again. A high Canadian dollar and an extremely high cost of living (housing) combine to make me less competitive against my counterparts in the US. They can agree to take lower compensation and still have a nicer house (better standard of living) than I… my productivity levels are comparable or better when comparing apples to apples, but I get less bang for my buck. Housing prices must come down to ensure that Canada is still competitive on the international stage.”
- Burbs Boy at VCI 29 Feb 2012 12:34pm

Opinion; Food For Thought – “The people of this region have a near infinite capacity for diminished expectations. Personally, I’m planning to move because I want something better.”

“It may not end.  The people of this region have a near infinite capacity for diminished expectations.  They seem to always do what they are told and accept what they are given, and no matter how ridiculous it is.  They will pay more and more for less and less.  Today it’s $700k for an old basement on a busy road in hookertown.  Tomorrow it could be $1 million dollars for a tent and a license to beg in the rain.  It’s the best place on earth you know.

That’s the true value of Vancouver: chumps.  There is an inexhaustible supply of fools who will never look elsewhere and the media apparatus to direct them.  Pay $10 for a hot dog?  Lineups for days.  Why not $100?  Limited time only.  Buy now.  These people will pay anything and do anything, regardless of whether it makes sense, and that’s why Vancouver is so valuable.  It’s not the land, or the scenery, or the climate, and it’s certainly not the standard of living.  It’s the people.

You can argue from simple mathematics that eventually this must end.  The population will be unable to pay for it.  This is true, but don’t ignore the fact that so many 60 year olds have 40 year mortgages.  When the general population can wield sums of money that they have no hope of repaying the integrity of the system is lost.  Money doesn’t mean anything in Vancouver, and under current policies Canada is sure to follow.  We have socialized credit and destroyed capitalism.  Newcomers don’t own anything in Vancouver and won’t get the opportunity.  It’s like a communist country, which is maybe why HAM finds it so appealing.

As for options, with the precedent established and the trend so firmly in place, there is no reason to bet on a reversal.  In 2008 this new system cracked and the authorities handed out gobs of money to favoured groups until it was fixed and the transformation could continue.  They invited corrupt CPC officials to immigrate and launder an unprecedented amount of money through Canada.  Anyone betting on an ounce of fairness or responsibility was badly burned.

That’s it as far as I’m concerned.  The social structure in Canada is ossifying and the economic structure is in decline.  Our neighbours to the south have once again shown the way, by restoring balance to their system after only a few crazy years.  Despite this enormous cost (or actually, because of it) sensible investment opportunities exist in the United States.  That country is dynamic again.  The fact that an American dollar today buys twice as much food, twice as much house, and twice as much gas is a harbinger of things to come.  Canadians foolishly think they are better off, but Canada is going nowhere.  Trade your Canadian dollars at par while you can, and move to the US to enjoy the standard of living you expect and get the opportunities that everyone deserves.

The worst thing you could do in life isn’t buying a $700k Vancouver basement suite, it’s sitting around waiting for that to change.  It may not change, or if it does, it may take too long, or you may not like it anymore.  So you better have a plan in motion.

Personally, planning to move because I want something better, full stop.  Vancouver is just crap with a zero on the end, and Canada is grossly overrated too.  I’m 50% out of Canadian assets because I don’t think our dollar is worth what the world says it is.  I see China imploding instead of leading the world.  Their model of over-investment is near an end.  I think the next great invention will come from the United States, and the next bull market will be born there.  They have so many small companies working on the next big thing, you have no idea.  If you want opportunity, it’s there.  They have nice houses for $100,000.  Buy one and get on with life.  It doesn’t have to be perfect.  It’s as close to economic freedom as you are ever likely to get.  I am astounded that people on this website could be offered this and somehow turn it down.

Real estate and credit bubbles were the last decade, so why is Canada still mired in it?  Who even gives a shit?  In the greater world, nobody.  And nor should they care.  And nor should you.”

- rp1 at VREAA 26 Feb 2012 1:37am

Vancouver’s Too Expensive For Entrepreneurs – “Last night during a meeting we realized that of five, only two of us aren’t thinking about leaving the city in the next year or two.”

“Over the past year I began working with a loose group of consultants; there are five of us who work together in complementary ways. We’ve taken steps towards forming a more formal business together, but last night during a meeting realized that of five, only two aren’t thinking about leaving the city in the next year or two. Vancouver’s too expensive to be an entrepreneur and have a family, and we all want other things – like retirement funds, or the ability to travel and take vacations, etc.”
- Absinthe at VREAA 20 Feb 2012 11:37am

“Comparing Vancouver to NY is about the most preposterous claim I have heard in this lifetime and the next.”

“This is hilarious! As a New Yorker (professional) now at my firms offices in Toronto (till the summer) and having been to Vancouver numerous times, let me say comparing Vancouver to NY is about the most preposterous claim I have heard in this lifetime and the next. I mean despite the weather Vancity ain’t even half of what Seattle is. And trust me no way Calgary (which I also know well) even at its worst is anything approaching the abysmal city of Cleveland. Frankly, Toronto is the only city that has some semblance of NY flair, power and commercial/corporate muscle in Canada, but Montreal is truly Canada’s only international city even with the horrible weather and all. And really they have to pay better in Vancouver — I mean how can you have such house prices on the MacDonald’s salary they pay out there!? That is just criminal!”
- comment by ‘Demrep’ Feb 2012, in response to ‘The real problem with Vancouver’s outrageous house prices’, Maclean’s, 1 Jun 2011

Mayor’s ‘Housing Affordability Task Force’ – “Vancouver must be a city where our children can afford to live and raise their families.”

“Vancouver Mayor Gregor Robertson has drawn deeply on all sectors of the housing industry to represent his new “housing affordability task force” in the hope of finding realistic solutions to the city’s housing problems.
From developers and builders to academics, housing finance groups and operators of not-for-profit housing, the 14 members will assist the mayor and co-chair Olga Ilich to try to find new ways to soften the effects of the city’s systemic housing affordability crisis.
They will prepare an interim report by March 12, which will then be opened for public consultation. A final report is due June 30.
Robertson said Vancouver faced extraordinary challenges in creating affordable housing and he wanted the task force to look at ways to both protect existing housing and to create more. The city has a 10-year housing and homeless strategy of creating 38,000 new affordable homes, including 5,000 new purpose-built rentals and 20,000 new housing units.
Over the years, successive councils have grappled with the seemingly intractable problem of stimulating affordable housing without destabilizing the existing stock.”
…
“The 14 members will help mayor and co-chair find new ways to soften the effects of the city’s affordability crisis.”
In addition to Ilich and Robertson, the task force includes:
Alan Boniface — Principal, DIALOG & Urban Land Institute B.C. Chairman
Nathan Edelson — Senior Partner, 42 Street Consulting
Leonard George — Director, Economic Development, Tsleil-Waututh Nation
Marg Gordon — CEO, B.C. Apartment Owners & Managers Association
Mark Guslits — architect, principal, Mark Guslits & Associates Inc.
Colleen Hardwick — founder and CEO, New City Ventures
Howard Johnson — CEO, Baptist Housing
Kenneth Kwan — Chairman, Building Committee, SUCCESS
Michael Lewis — Executive Director, Canadian Centre for Community Renewal
Eric Martin — VP, Bosa Development Corp.
Karen O’Shannacery — Executive Director, Lookout Society
Al Poettcker — President & CEO, UBC Properties Trust
Peter Simpson — President & CEO, Greater Vancouver Home Builders Association
Bradford Tone — President, Tone Management
“The members of the Housing Affordability Task Force bring a broad and diverse array of experience, leadership, and vision to our work on the pressing challenge of affordability,” Robertson said in an emailed statement.
“Vancouver must be a city where our children can afford to live and raise their families. This is not a simple challenge but it is one that we have to address — and I believe this task force has the ideas and expertise to provide new affordability solutions for Vancouver.”
- from ‘Vancouver appoints ‘housing affordability task force’, Vancouver Sun, 6 Feb 2012
—

“Foxes To Design New Henhouse?” – Actually, such criticism would be too easy, too glib, and, we would hope, incorrect. Not everybody on the task force is a developer. Still, interesting that people trying to solve the problem should come from “all sectors of the housing industry“. Isn’t there a possibility that some important solutions may involve steps that are not in the best interests of “the housing industry”, and that those would be avoided by this task force?

Having said that, we’re sure that there are members of this task force who are well-meaning, and have a genuine desire to attempt to ‘solve’ the housing ‘problem’ that faces Vancouver. We’ll be genuinely interested to see what they come up with.
Forgive us our jadedness, but we’d expect their ‘final report’ to include:
1. Opening and final statements regarding the importance of ‘affordable housing’ to Vancouver, our futures, our communities, our children, etc.
2. Suggestions for projects that involve small and/or low quality units at lower prices, but essentially still at ‘market prices’ for what they are. As per the ‘two parking spot’ bachelor suites released last year.
3. Projects that benefit “the housing industry” at the expense of tax-payers.
4. Absolutely no mention of the real cause of the housing crisis in Vancouver, namely the massive speculative mania driven by overextended locals high on cheap debt.
5. No plans that would risk ‘destabilizing’ current housing prices.

Regular readers know that we believe that Vancouver is in the grips of a very large bubble in housing, and that prices are at levels 2 to 3 times those supported by fundamental values. The speculative mania so distorts the market that any current talk of trying to make changes to improve ‘housing affordability’ is rendered trivial and cosmetic. Once the bubble bursts and prices drop 50%-66%, the whole ‘affordability’ picture will look very different. Thereafter there will still be a need for sensible housing policy for the city and the region, and perhaps a task force will be helpful at that point. Until then attempts to address ‘affordability’ are rearranging the proverbial deck chairs on the proverbial Titanic.
- vreaa

“My wife and I could never buy into a life of servitude to a bank. We just aren’t built to borrow money and don’t consider life as a one track job in order to buy a building.”

“For our family it’s been about enjoying life. My wife and I could never buy into a life of servitude to a bank. It’s not in our DNA. We just aren’t built to borrow money and don’t consider life as a one track job in order to buy a building. We travel and explore BC and paid the university education for two kids. When we first moved to the LM from the Okanagan, we stopped at Haro and Jervis for several years (when a one bedroom was $400/m) and watched the tone of the city change from a cultural oasis to a financial oasis. I almost bought a suite for $90k, but the spirit changed. We wanted out. Now we live on a five acre farm near Golden Ears for $900 a month. We do lots of care taking and the owner keeps the rent low. Fresh eggs, beautiful scenery, and slow paced neighbors who are more interested in gardening than real estate. We’ve saved enough to buy a house for cash near Merritt and have our RRSP’s topped up.
I can appreciate that some folk want to acquire, however that need is at the jeopardy of a full rounded community with contributions from all walks of life. There’s some wonderful people in Vancouver, friendly, but there is a shift in attitude. It’s more about ‘stuff’ now. I don’t know, it might become a haven for the world’s rich, but at what expense to the people who were raised here? It’s like the pipeline up north—we pay carbon tax while the government and corporations pump our fossil fuels to Asia. There’s an underlying hypocrisy in many aspects of Vancouver and British Columbia’s growth. I don’t think the government made good decisions about sustainable living for the citizens of BC. I do believe their priority has been a tax base and many other aspects of culture and affordable living have been secondary. I know some real estate agents and I hold them personally responsible for jacking up prices at every turn. They were born to sell anything for a profit, and I am afraid they are now influencing public policy.
Can Vancouver survive an era of personal gain and self gratification? The same attitude didn’t prepare another glamor town very well, Las Vegas was hit very hard and it still hasn’t recovered from 2008. Two more years and our family is out. We are taking our design and manufacturing business as well. Freight on board out of Merritt is cheaper than expanding into a commercial site here.
Will be back to visit.”
- debtless in poco at VREAA 7 Feb 2012 9:25am

Talk of life without debt, fresh eggs, beautiful scenery, slow pace, neighbours, community.
Freaks!
- vreaa

Avoiding Vancouver, Recent Stories

“As a home owner in Vancouver, I never could save for retirement. We sold and moved to the best big city for a family – Ottawa. Wow, we’ve not regretted that move.
Bottomline, we listen to our gut… we felt the times are changing, RE is not where we should be.
In Ottawa we rent.
At no cost, we evicted the squirrels, have a new stove, water system, and a few more “details” and my kids love the acres to play !!!
I max out my TSFA, RRSP, RESP (for 3 kids) + more because I don’t believe in home ownership (for now).”
- Carp at greaterfool.ca 27 Jan 2012 12:54am

“Finally, after years of waiting for some sanity and affordability to no avail, I am moving next month to California.
Got the E2 visa today.
I never thought it will come to this, but I see no opportunity here other than selling real estate to rich Chinese.
I am confident fundamentals will eventually prevail, but I cannot live on the expectative for ever.
I mostly agree with the bear argument, yet the reality is that for the last 10 years it has been so wrong. Ant that is a very long time.
I only hope bears will eventually be right for the sake of the new generations. I am out of here. Good luck.”
- paradox at vancouvercondo.info 26 Jan 2012 11:35am

“Just had another ex-Vancouverite who got hired here in Calgary. She was living with her husband in his parents house in East Vancouver because of the unaffordability and they wanted to save money. She also was blunt and said her husband will make about 50K more working in Alberta compared to Vancouver!”
- calguy at VREAA 2 Feb 2012 6:57pm

“My wife and I have decided to take our $750,000 deposit money and seek fairer value — and potentially better jobs — elsewhere in Canada when we begin our search to return from Europe come the spring. So chalk three more (including our son) up to the number of people who are deterred from coming to Vancouver. A shame, cos I grew up on the North Shore, partly. But needs must!”
- Craig Sterling [not his real name] at VREAA 23 Jan 2012 6:33am

“Sky-high Vancouver housing prices were one of the reasons why my son, a young engineer, and his wife chose to move to Montreal, where they were able to buy a townhouse for half what they’d have to pay here.”

“In fact, sky-high Vancouver housing prices were one of the reasons why my son, a young engineer, and his wife chose to move to Montreal, where they were able to buy a townhouse for half what they’d have to pay here.
They miss Vancouver terribly, and we miss them and our little granddaughter. But we realize the vast distance separating us is the penalty we pay for living in Lotusland, and my son pays for having a real job.”
- from ‘We need to look at a greater variety of housing options’, Jon Ferry, The Province, 27 Jan 2012
Hat-tip to Patiently Waiting, at vancouvercondo.info 27 Jan 2012 2:44pm, who also adds:
“A smug Boomer newspaper columnist is suddenly concerned about housing affordability. Why?
He’s only concerned now that it affects him personally.”

Leaving Vancouver, Again – “Came back for what was supposed to be career advancement. Didn’t pan out. My old company in Switzerland called and wanted to know if I would move back there to work for them. Immediate 100% increase in salary, 6 weeks holiday again, living in truly the best place on earth, etc.”

“I did the whole ‘go-away-and-make-money’ thing. Saved over $1 million in 5 years working abroad. Had a fantastic client situation, was making amazing money. Came back for what was supposed to be career advancement. Didn’t pan out. Making 65% less, doing same job, working longer hours. Real Estate also went way way up and now – So – even though I could get “something” it just makes no financial sense to own. Renting a penthouse downtown for a 1.5% cap rate.
So – now looking to go back on the world circuit. Vancouver is nice – but if you have a choice of where to be – there is no reason people should make a professional career here . . period.
I have a very deep skill-set from my experiences abroad that are just not available from others in the local market – however – the local market won’t pay for it.
People are leaving all the time but Vancouver as a city will not progress and attract any outside talent because if they are mobile, the amount that would have to be paid to be here is so high that nobody will pay.”
- ZRH2YVR at VREAA 10 December 2011 1:08 pm

“Today I got the call I thought would come one day. It took almost 5 years of being in Vancouver – however – My old company/client in Switzerland called and wanted to know if I would move back there to work for them. Immediate 100% increase in salary, 6 weeks holiday again, living in truly the best place on earth, no street people begging from me on my walk in every day, 50 world class cities within 2 hours flying, 30 ski resorts within 3 hour drive, perfectly on-time and clean and spacious public transit, unbelievable career potential, international Global 100 company. Um – – – – let me think about it . . Absolutely no weekend working. Or – – – slaving it out here waiting for the market to crash while working 70 hours a week trying to get ahead…”
- ZRH2YVR at VREAA 27 Dec 2012 10:35pm

We hear this news with mixed feelings: Almost definitely good for you, ZRH2YVR; but not good for Vancouver.
We wish you all the best in all future endeavours.
Many thanks for all of your posts on these pages.
The pressure on sensible folks to leave is not good for our town.
- vreaa

“The two top tech companies could not find anyone to fill the position. The number one reason given by the numerous Canadian & US-based candidates for withdrawing was the cost of living in Vancouver.”

“Heard two interesting Vancouver anecdotes recently. Two top tech companies (one bio, one IT) were recruiting for certain specialist legal skill sets. Given that very few people meet the criteria the jobs were advertised across North America. Both companies were offering very attractive salaries and both were prepared to pay for relocation etc.
In both cases, despite interviewing numerous Canadian & US-based candidates, the companies could not find anyone to fill the position. The number one reason given by candidates for withdrawing…the cost of living in Vancouver was just too high.”
- Bally at VREAA 26 Jan 2012 6:16pm

Anybody not troubled by stories such as this really doesn’t care about the future of this city. – vreaa

“I left Vancouver in 2005. When I go back to visit, the conversation usually turns to RE with snooty relatives boasting about their $1M houses.”

“I left Vancouver in 2005. Sure glad I did. When I go back to visit family, the conversation usually turns to RE with snooty relatives boasting about their one million dollar houses. I can’t wait for the housing bubble to pop and humble these folks. It will be a tough fall to reality for Vancouver.”
- Uh Oh Canada at greaterfool.ca 6 Jan 2012 10:37pm

“Vancouver, this sounds pretty stressful to us. We have decided to leave you and move to Texas where my salary would be double and our living expenses would be less than half.”

“Dear Vancouver,
Happy new year!
I’ve lived here most of my life, I’m 32, married now and about the right age to buy a home and start a family.
My wife and I have been saving up for a nice 2 bedroom apartment for several years. We’ve looked at the prices and it seems too risky in terms of ending up “house poor”. We’ve been waiting and waiting for anything to change in Vancouver, but nothing has happened!
At the current state of things, after doing some calculations we envisioned a situation where we would be both forced to work (dual income) and drop our future children into daycare in order to make ends meet. Most likely we will make the payments just fine but without any retirement savings no extras for vacation, etc. Vancouver, this sounds pretty stressful to us.
So after much deliberation, we decided to leave you and move to Texas where my salary would be double and our living expenses would be less than half.
In Texas we would be able to afford a large home and still save plenty for vacation/retirement/etc and this is on only one income!!
My commute is only a 5 minute drive, the people are so friendly, it feels like the same level of friendliness as being at church everywhere I go.
The weather is great, I don’t see any junkies, at worst there is a homeless person with a sign by the highway asking for change.
I thank you Vancouver for your past accomplishments, your scenery, your skytrain lines and abundance of sushi restaurants.
Unfortunately at this time I will not be needing your services and wish you farewell.
Sincerely,
A former Vancouver resident (for more than 28 years!)”
- from formervancouverresident at vancouvercondo.info 1 Jan 2012 10:22am

“Sold a 1940′s small house in Victoria in 2011 and took a year off to travel. Now in sunny Florida, where I could buy 4 similar houses for what we got for the Victoria place.”

“Sold a 1940′s small house in Victoria in March last year and took a year off to travel. Currently I’m in sunny Florida on the gulf coast, I could buy 4 similar houses here for what we got for the Victoria place. Also cost of living here is so much less, and I spent the day on a beautiful white sand beach watching dolphins play. A lot of people in BC are delusional.”
- Beagle at greaterfool.ca 9 Jan 2012 8:17pm

“I’m running out of patience with the bubble in the city. If it does not pop soon I’ll move on to another city or country.”

“I’m running out of patience with the bubble in the city. If it does not pop soon I’ll move on to another city or country. So plans do revolve around the housing market for most – either counting on real estate for retirement, or deciding to stay/leave. And that dependence grows as one gets older, has kids and thinks about school districts.”
- 604x at vancouvercondo.info 15 Jan 2012 at 6:22pm

Succinct.
Can’t the bubbleheads see how bad this is for our town?
- vreaa

House ‘A’ and House ‘B’

House ‘A’
2,000 sqft SFH, on 3,920 sqft lot
Built 1910
“..elegant living room with hardwood floors and two all-brick fireplaces with mantles. The kitchen is gorgeous with the cabinets and built-in breakfast bar. Other features include a wood fence and covered front porch. The bedrooms are outstanding with their sleek hardwood floors and baseboard trim. The bathrooms have shower-tub combinations, while one has a pedestal sink and another has a sink in the lovely wooden vanity. .. Great location to community parks, schools, restaurants…”
—

House ‘B’
2,136 sqft SFH, on 3,716 sqft lot
Built circa 1910
“..lovely home has been renovated. New paint, newer kitchen, bathrooms, wiring, plumbing, new roof, windows, water tank. Beautiful front and backyard. Steps to top schools.”
—

The reveal:
The first property is 1112 North 34th Street, Richmond VA, on the market for $130,000 ($65 per sqft)
The second property is 3043 Crown Street, Vancouver BC, on the market for $1,878,000 ($879 per sqft)
[hat-tip Ralph Cramdown for the idea for this particular comparison]

Yes, we know that Richmond VA isn’t Vancouver BC, but then $130,000 is a lot, lot, lot less than $1,878,000.
Ninety-three percent less, to be precise.
Buy 14 houses in Richmond for the price of the one in Vancouver, and still have change.
- vreaa

“40 years old, married with two young kids. Leaving for Victoria and a mortgage free life. Now I can focus on building a retirement portfolio and not having the bulk of my wealth tied up in my house.”

“I am leaving as well. 40 years old, married with two young kids. Leaving for Victoria and a mortgage free life. Now I can focus on building a retirement portfolio and not having the bulk of my wealth tied up in my house. Thank you Vancouver Realestate its been great, but I am out! I feel like I won the lottery.”
- 2muchdebt at VREAA 14 Jan 2012 12:44pm

“I’m leaving. There is no scope for even holding the line in Vancouver. I am not having my living standards degraded incrementally until I am living like a college student, which is about the best that could be hoped for here.”

“It certainly is over for me- I’m leaving! There is no scope for even holding the line in Vancouver.
I am one of the most versatile and competent people you could probably ever get to work for you in nearly any type of business, and have watched all the work move farther and farther out towards the valley since around 1998. I have also watched the quality of jobs deteriorate to the point a large proportion of jobs on offer are contract, part time or consultant, for about half what similar work would pay in other regions of Canada.
The obsession with RE has poisoned Vancouver- it has been a tremendous misallocation of resources, there was a link recently on one of the sites that indicated there are roughly 40 more business licenses in Vancouver than there were in ~1997…this doesn’t bode well for anybody. The idea that wealth is created only via real estate investment or other get-rich-quick schemes has driven investment away from business. What’s more many businesses that might well do OK in Vancouver can’t survive because the businesses that support THEM aren’t here. Warehousing and jobbers have fled the Vancouver area over the last decade, as an example.
The constant war on automobiles here has made it complicated and costly to operate a car, and I’d remind you, the people in those cars are going to work, who do we think pays for everything? The AirCare fiasco has had one primary achievement, it’s taken away basic transportation from single mothers in the LM.
I will be moving out of province, to a city I frankly detest, but that I have familial ties to that offers me about twice the income, twice the space, half the red tape and niggling issues, virtually no crime or street people or rain and I’ll visit BC as a tourist next time. 21 years is enough, I am not having my living standards degraded incrementally until I am living like a college student, which is about the best that could be hoped for here.
I’ll miss my beach, but little else, unfortunately. Most of the things I consider the good stuff about Vancouver haven’t actually existed here for many years.”
- whiteshoes at VREAA 3 Jan 2012 3:20pm

“Metro Vancouver’s inflated housing prices are hard on the health of everyone, immigrant and non-immigrant.”

“Men who immigrate to Vancouver are twice as likely to report poor health compared to males who choose Toronto.
Female immigrants are 1.5 times more inclined to struggle with their health in Vancouver compared to women who end up in Ontario’s largest city.
The figures are not much better for immigrant males who choose Vancouver instead of Montreal.
The StatsCan longitudinal study suggested the findings about Vancouver needed further research. Yet, after consulting with noted Vancouver immigration specialist Richard Kurland, we have come up with four possible reasons why Vancouver is unusually rough on immigrants’ physical and mental health.
The first reason is actually hinted at in the report, written by StatsCan official Edward Ng, as well as Kevin Pottie and Denise Spitzer, both of the University of Ottawa.
It relates to housing. The report inadvertently linked the two by cryptically reporting “declining health” among new immigrants “who were not satisfied with their housing, and who lived in Vancouver.”
Although the statisticians didn’t draw a direct connection, Kurland is among those who recognize that Metro Vancouver’s inflated housing prices are hard on the health of everyone, immigrant and non-immigrant.
“Housing is always a Vancouver problem,” he said.
It’s not hard to imagine how expensive housing can lead to cramped living, extended families being forced to tensely live together and long commutes to work.”
- from ‘Why is Vancouver so bad for immigrants’ health?’, by Douglas Todd, Vancouver Sun, 7 Jan 2011[hat-tip Loon]

The described relationship is an association, rather than a proven causative link.
Regardless, it is of note to see a mainstream local article even suggesting that “inflated housing prices” may be linked to “poor health”. The article suggests possible mechanisms of (1) cramped living (with physical and mental health risks) and (2) long commutes. Other factors possibly making the link causative would be the long term psychological stress of financial overcommitment to housing.
- vreaa

“I am not buying cheap crap for a tonne of money. Sorry, you have underestimated me.”

“Well, I have been sitting tight for many years. Other provinces looking better day by day.
I am very patient, but now researching what I can get out of other provinces as this one is fcked.
I have been fighting to keep every penny in my pocket, whether shopping or renting or using a car. It has paid off for me. I am not “united way” to the realtors or the industry. I live by the motto, if they want too much, they get nothing, in other words, if you want to do a business deal with me, you better have something to bring to the table.
I am not buying cheap crap for a tonne of money, sorry, you have underestimated me. Yeah, I dont look like a hawtie, but guess what, I have something to my name and you (RE) aint getting a penny of it.
Eat that!”
- squeaky at vancouvercondo.info 31 Dec 2011 7:44pm

“I had a chance encounter with a Vancouver RE agent who caters to Chinese investors. Turns out she is here in the Phoenix area looking for investment properties for her clients.”

“Had a chance encounter with a Vancouver RE agent (who caters to Chinese investors) this morning. Turns out she is here in the Phoenix area looking for investment properties for her clients.
As well, she already has a few of her own places she rents out as vacation properties.
Didn’t have a chance to ask her what she thought of the Vancouver market – but it was interesting to see her down here on behalf of her clients.
The going rate for a vacation rental Oct-Apr is about $ 2200-2500 a month, and about half that the rest of the year. This is for homes with less than $ 150K into them (if bought within the last year or so).”
- Snowboid at greaterfool.ca 28 Dec 2011 12:01am

Wow, look at those fundamentals.
That’s roughly an average of $1860 p.m rent (less expenses) for $150K.
What would that cost you in Vancouver?
And the US hasn’t yet bottomed.
- vreaa

Extirpated Biologist – “In conservation biology, when a species can no longer survive in its home territory, it is referred to as “extirpated”.

From the ‘Introduce Yourself To The Forum’ thread at RE Talks, a post by ‘extirpated’, 22 Mar 2011 7:55pm-

1) Age / Location / Occupation
“38, born and raised in Richmond BC (to Polish immigrants) forced out of my home province by rising real estate prices and the desire to live in my own house. Conservation biologist – turned – artist”

2) What real estate do you own?
“2 houses, which are not in BC”

3) What’s your view on the market going forward? Buyer or seller? Which parts of the market?
“I don’t think I’ll ever be able to afford to live in BC again”

4) Anything else?
“In conservation biology, when a species can no longer survive in its home territory, it is referred to as “extirpated”.

Returning Expat Finds Vancouver Pricing “Nuts” – “I found the prices incredible – more expensive per square foot than central London!”

“Hi – for what it’s worth, I’m a Canadian citizen who moved to Europe at the age of 15 with his parents and I’m now looking to come back (with wife and child) to YVR. I grew up in West Van and I found the prices incredible when I paid a visit in April 11 – more expensive per square foot than central London!
If Europe’s experience is anything to go by, you *might* see 15%-20% drop (mostly in marginal areas) over the next 18 months followed by a subsequent slow decline of 2-5% per year. But of course, the Canadian economy is in nothing like the same mess as the US/UK, so… maybe not.
Can anyone recommend decent areas without nuts pricing on the North Shore, or am I just being totally ignorant?
With thanks –
Craig Sterling”
- Craig at VREAA 21 Dec 2011 4:18am

We’d recommend many areas, but only after prices collapse. Sometime later this decade; perhaps in a few years time. Prices will end up dropping over 50% by the trough; across the board. No sector will be immune, despite what the various cheerleaders tell you.
And even after the 50%+ drop, Vancouver RE will still be richly priced by both global and Canadian standards. – vreaa

“Sounds idyllic, living in a smaller centre with your cashed-in RE wealth but it’s not for anyone who is going to get older and require the care of a health care specialist.”

“My parents left a bigger city for a smaller town in retirement, and took their own parents with them (who were in their 80s). They soon realized that this was a big mistake, because health care in the smaller centres is just not adequate. Sure, you can see a family doctor no problem, but when Grandpa has a heart attack and needs to see a cardiologist regularly, or Grandma is going blind and needs an ophthalmologist, suddenly it becomes clear that driving 2 hours over snowy mountains to get them the care they need is just not feasible. Sounds idyllic, living in a smaller centre with your cashed-in RE wealth but it’s not for anyone who is going to get older and require the care of a health care specialist. And I sure hope my parents leave their smaller city before they get too old (which they are now seriously considering, giving their experiences with my grandparents).”
- pricedoutfornow at VREAA 25 Nov 2011 10:43am

People Moving To Vancouver

“10-12 health care professionals in my office arriving to Vancouver in the past two years from Vancouver Island, Alberta, UK, Australia, and Denmark. Far more arriving than leaving in my line of work – others might have different experience.”
- eyesthebye at RETalks 20 Oct 2011 8:49am

“I met a couple of people last night who had recently moved here. One was from Montreal, one Australia. Both in their early 20s. Neither of them are what you would call skilled, one a labourer and the other just got a job at a sandwich joint downtown; but they were both set on spending some time in Vancouver.
I asked them both what brought them here, the Montrealer said he wanted to stay in Canada and the winters back home were a bit much. He had been here 2 months and he said he already met some great friends and thinks Vancouver is one of the friendliest big cities he has ever been to (he recently travelled Australia for a year and Europe for 6 months).
The Aussi had originally planned to head around Canada for a year spending 3-4 months in a few cities, but after 2 weeks in Vancouver she is looking for an apartment and plans to spend her full year here.
Neither of these people will replace the people in the prior anecdote that are leaving, and they may not even be permanent, but I was pretty surprised to hear how highly they spoke of Vancouver compared to their hometowns of Montreal and Sidney.”
- davers at VREAA 9 Dec 2011 12:26pm

“We know a young married couple that is moving to Vancouver from Victoria. He’s an IT manager, she works in admin. They have been checking out condos in Vancouver. They think renting is a waste of money so they are looking to buy.”
- Victoria Gal at VREAA 11 Dec 2011 12:00am

“Three of my friends are leaving the city, all are professionals making decent money, two of them are leaving the country, one of them is moving to another province. There is a good chance I’ll be leaving in the first half of 2012, and I’ll be selling my property when I leave.”

“Three of my friends are leaving the city. One has already left in the spring, another has left just 2 weeks ago and third is leaving in about 1 month. All 3 are professionals making decent money, 2 of them are leaving the country, one of them is moving to another province. I guess one good thing is that they create job openings for other professionals. There is a good chance I’ll be leaving the country also in the first half of 2012, and i’ll be selling my property when i leave. Not sure how this compares to overall vancouver immigration statistics but I just wanted to throw these anecdotes out there.”
- RENoob at RETalks 19 Oct 2011 3:22pm

“No offense but who cares? People leave cities all the time and more people move in. End of story.”
- vanreal at RE Talks Oct 19, 2011 3:30 pm

Anecdotes about fine young skilled educated professionals leaving are vastly over-represented by sour renters.
Anecdotes about fine young skilled educated professionals arriving are vastly under-represented by sour renters.
- eyesthebye Oct 20, 2011 6:21 am

We look to post both sorts of anecdotes here — but it’s the former type that appear in abundance. We’d like to post more of the latter, please send along any stories of “fine young skilled educated professionals arriving” (and their circumstances), and we’ll post them. – vreaa

Tsur Somerville – “My friend went up to Mayor Robertson and said, ‘Look, you can’t have the city more affordable AND the most wonderful, greatest place to live in at the same time. Those things are fundamentally incompatible.’ “

“And my friend went up to [Mayor] Robertson and said, ‘Look, you can’t have the city more affordable AND the most wonderful, greatest place to live in at the same time. Those things are fundamentally incompatible. All those things you’re going to do to make it the most wonderful, greatest, hippest place to be are all going to make it more expensive.’” …
“You want to promote Vancouver as a world-class city, and then you say to the world, don’t come here? It seems a little contradictory, don’t you think?”
- Tsur Somerville, UBC’s Sauder School of Business, as quoted in ‘We all want affordable housing – somewhere else’, Pete McMartin, Vancouver Sun 8 Dec 2011.

Further excerpts from the same article:

“Affordable housing is hot these days. Everyone wants it: no one knows how to get it. Robertson promised a task force on it. Some want a restriction on foreign ownership. They put the blame for rising prices at the well-shod feet of wealthy immigrants.
Statistical evidence propelling that argument is slim. Because transactions are often done through intermediaries, it’s hard to track foreign ownership sales. But the anecdotal evidence is eye-popping, and has a lot of people convinced foreign buyers are the main levers pushing up of house prices.
Somerville isn’t so sure. They may be a factor on Vancouver’s west side, he’d allow, but not in Surrey or Coquitlam.
…
Affordability means different things to different people.
One, if you own a house, you find yourself on the other side of the coin. You want house prices to rise. At the very least, you don’t want them to fall.
Two, it depends on who you want affordable housing for.
“To me,” Somerville said, “for someone wanting to live on the West Side but ending up in Burnaby because they can’t afford to buy on the West Side doesn’t strike me as a problem. But for a single mom who can’t find a decent place to raise her children, that’s a problem.”
—

Overall a pretty good piece. It brings some discussion of the contradictions inherent to the ‘affordability’ discussion into the mainstream press.
Somerville makes a good point with the promote/afford paradox comments, and we also agree with his comment regarding foreign buyers only affecting a relatively small sector of the market directly (and, we would add, the whole market indirectly).
We’d disagree with the Westside/Burnaby comment. Yes, we agree that the single mom in need of a decent place is a pressing problem, but so is the displaced professional. We believe that inflation of the market has had deleterious, albeit different, social effects at all price levels. For instance, there are many stories of overinflation of Westside (or Eastside) prices having caused surgeons and professors and business executives to avoid Vancouver: professionals who would have happily settled in Vancouver in moderately expensive homes have returned to Alberta, or the US; or left for Halifax or Ottawa; or not come here in the first place. You have to compare what they get here with what they get elsewhere: It’s not enough to say “Why not move to Burnaby, or White Rock ? – you can afford that”.
Finally, good for Pete McMartin to note that “if you own a house, you find yourself on the other side of the coin”. For those who would like to see policy changes that genuinely make housing broadly more ‘affordable’, this is a massive challenge: the vested interest of all Vancouver homeowners in ongoing excessively high home prices.
- vreaa

Short Film – “What Vancouver Means To Me”

Excerpts:

“Josh. This is me. I live in a basement suite in Vancouver, British Columbia. It’s actually connected to my parents’ house, but I have a separate entrance. And I’m looking for a new place on craigslist. Lots of people move to Vancouver to live in basement suites and small apartments. I don’t really know many people who were actually born here.”

“Rent is expensive in the city. Real Estate is also expensive. My ex-girlfriend’s boss just bought a new place downtown. I bet it’s really nice.”

“Vancouver is currently listed as one of the three most liveable cities in the world. I’m starting to think I wouldn’t mind trying the other two.”

What Vancouver Means to Me by Lewis Bennet and Mark Boucher

Bravo. A movie about bitter-sweet love. – vreaa
[Thanks to 'E.G.' for letting us all know about this.]

Sandy Garossino – “We need a thorough and rigorous analysis of our housing market, the causes of its extreme condition, the risks it poses for our long-term economic sustainability, and a study of the levers and mechanisms available to government to modulate those risks.”

From a post by Sandy Garossino, independent candidate for city council in the recent civic elections, at her blog votesandy.ca 28 Nov 2011. The entire post is a must read for those concerned about Vancouver housing. Some excerpts below for our chronological archive. -

“Relative to household income, our property values are now among the most severely unaffordable in the world. Relative to income, Vancouver’s property values are 56% higher than New York’s, and 31% higher than London’s.
In its November, 2011 report on the Canadian housing market, RBC notes that 94% of average household income is required to cover the ownership costs of a 2 storey detached home in Vancouver.
This development is new and unprecedented.”
…

…
“Excesses in the housing sector can generate key vulnerabilities in the financial system and the economy as a whole.
Rather than stimulating productivity and competitiveness through business investment, cheap credit has been used to bid up the price of houses.
Vancouver residential real estate values began to detach from their historical relative values to the rest of the Canadian market sometime around 2006, when volatility began to get very choppy.”
…
“Many see Vancouver in a housing bubble, and it may well be. Others however, such as celebrated architect Gregory Henriquez, think our prices still have far to go to reach that point. Amazingly, Henriquez says that Vancouver is still under-priced. He is not looking at local economic conditions, however, but at the international forces in play. Viewed globally, Henriquez says that our market has become the “safety-deposit box for the world.”
…
“… circumstances militate against Vancouver being able to compete in the global marketplace for the best and the brightest talent needed to drive the knowledge and creative economies that will sustain cities in the future.
Our universities are losing key talent and find themselves unable to attract replacements or build on what we have. Our business sector cannot recruit, our local merchants are caught in a fight for an ever-dwindling supply of disposable incomes, and attitudes are hardening against even modest tax increases necessary to maintain our basic infrastructure.”
…
“Many Vancouverites seem unaware of the strange drama unfolding in many of our neighbourhoods.
The west side of the city is shedding residents almost daily as international buyers purchase more and more housing stock. These homes often sit empty or are re-cycled into the market and re-sold at significant gains within months to other international purchasers.
The west side real estate market is behaving exactly like a secondary market in financial instruments rather than a shelter market. Often the commodity is not actually used or consumed, but only traded. This trait allows valuations to inflate so long as the market is supported by global buyers, completely independently of local economic conditions.
During the recent civic election I was twice approached by people who reported that their homes were the only ones occupied on their block.”
…
“Yet Mark Carney’s sobering warning last summer seems to have fallen on deaf ears. To hear local developers, urbanists and planners discuss this issue, you would think our market is within the normal range, and people concerned about the speculative spree fueled by interest rates and global capital influx are alarmists and potentially xenophobic.” [Well put. - vreaa]
…
“The theory currently dominating the discourse on our housing market points to natural or systemic causes for our pricing: our limited land base pressured by in-migration. According to this view, the cure for this market is to build more housing—ie. condominiums.
Yet in-migration is occurring at historically normal rates and we didn’t grow mountains and a southern frontier overnight.”
…
“Conclusion: It is time to take off the rose-coloured glasses and face some hard truths. We need a thorough and rigorous analysis of our housing market, the causes of its extreme condition, the risks it poses for our long-term economic sustainability, and a study of the levers and mechanisms available to government to modulate those risks.”
…

Great article. As we’ve said before, Garossino is to be applauded for publicly articulating the ‘hard truths’.
We agree with Garossino’s analysis in many respects.
The hope that there are ‘levers and mechanisms’ to ‘modulate the risks’ the market imposes, is similar to the hope for a ‘soft landing’ after a speculative mania. Some tweaking could alter the flight path, but who is going to be stepping in to buy very overpriced RE that has started a downward price trajectory?
- vreaa
[hat-tip Makaya.]

—

ADDENDUM 6 Dec 2011 8:20am

This comment posted to Sandy Garossino’s site:

Sandy,

Many thanks for this thoughtful and eloquent article.
We’ve headlined, excerpted, and commented on it in our chronological archives.

You are one of the few public figures speaking out on these issues, and we commend you for that. To point out these truths is brave; the thoughts are deeply unpopular in many quarters. As a consequence, most local  discussion of these issues has been done ‘underground’, in anonymous online forums. Some individuals, such as Gord Goble and Peter Ladner, have spoken out publicly, and you are a welcome continuation of that move.

We agree with your concerns about the multitudinous deleterious consequences of the massive misallocation of resources that comes with a speculative mania in housing. The optimist in us wishes you well with your endeavours to alter policy for the better. The realist is concerned that the only path forward for the speculative mania is a crash.

Judging by historically valid underlying fundamentals such as incomes and rent levels, Vancouver RE market prices are 2 to 3 times fair value, perhaps even more.
You see the speculative mania for what it is, and you are suggesting we attempt to orchestrate a ‘soft landing’ (no mean feat, if it is possible at all).
That suggestion itself creates a massive dilemma:
Given that there is such a large difference between the market price of properties, and their fundamental values, who do we hope to be buying these properties at perhaps slightly reduced but still massively elevated prices in the coming years?
Wouldn’t any such buyers be risking financial suicide?
Isn’t the only credible resolution a marked drop in prices, and then a recovery from the rubble?
Aren’t band-aid solutions on the way down simply going to put even more locals at dire financial risk?

Keep up the good work,
vreaa
(vancouver real estate anecdote archivist)

“In Victoria a 100 year old, 2bd 1 ba, 700 sqft. POS house that needs asbestos remediation in a dodgy neighbourhood costs $400K. That same $400K in Seattle buys me a 5 year old, 4bd 2.5 ba, 2000 sqft. house in a very desirable neighbourhood.”

“I live in Victoria, which is only 3/4 as stupidly expensive as Vancouver. My wife and I are both dual citizens and have lived and worked in both countries. We have family in Victoria, Vancouver and Seattle. How we decide where to settle has less to do with being near in-laws or love of country and more with where we can do the best for our own little family and get the most value for our money.
Here in Vic, I can buy a 100 year old, 2bd 1 ba, 700 sq. ft. POS house that needs asbestos remediation in a neighbourhood I wouldn’t want my wife walking around after dark for $400,000. That same $400,000 in Seattle buys me a 5 year old, 4bd 2.5 ba, 2000 sq. ft. house in a very desirable neighbourhood with some of the best public schools in Washington state.
I lived in the States before, during and after the bubble. When that sucker burst it was ugly and has created a permanent underclass of bubble buyers. If that were to happen here it might make real estate less expensive but I’m not sure people are prepared for the inevitable economic and political fallout. The cheaper house prices will be a wafer-thin silver lining on an otherwise very dark storm cloud that will hang over this region for many years. I’d rather not live through that again.
I don’t think any price drop would get me to stay. Mind you, I’m in a different situation than most as the border is not an obstacle and we’ve got family all over, but I would still encourage those who don’t have US citizenship to explore their options and keep an open mind when considering where to settle.”
- ‘nobody you know’ at VREAA 3 Dec 2011 10:09am [A follow up to 'We Came; We Saw; We're Leaving' statement by 'nobody you know' 2 Dec 2011.]

CBC – “Canadian housing bubble about to burst.”

CBC cited the recent ‘The Economist’ article, and interviewed David Madani of Capital Economics, 30 Nov 2011.
Podcast available at this link.
Hat-tip to ‘VanAddict’ who also writes:
“My husband and I left Vancouver due to high housing prices. We now live in the Waterloo region, about an hour northwest of Toronto. I listen to CBC radio on a regular basis. I recently heard a couple of pod-casts that made me think of your blog. The housing bubble is a big concern for all of Canada, including the Waterloo region. We are homeowners as well, so we could very well be affected when the bubble bursts. Luckily, we aren’t overextended like some people.”

Request To Readers From Edmonton Journalist Max Fawcett

Max Fawcett, an Edmonton journalist, writes: “I’m working on a story for an Edmonton magazine about educated/middle class people leaving Vancouver for Edmonton. Do you know anybody like this? Have you run into anyone like this in the course of your online travels?”
Any readers who can help Max with his request, please contact him at maxfawcett@gmail.com
[Max's own story about his leaving Vancouver was featured at VREAA 14 May 2010.]

We Came; We Saw; We’re Leaving – “Vancouver is “nice”. I was sent here by my firm 6 months ago for a permanent transfer. My wife and I are leaving. It’s just not nice enough.”

“Vancouver is nice. That’s it. It’s “nice”. I was sent here by my firm 6 months ago for a permanent transfer. My wife and I (we’re just under 30) are leaving. It’s just not nice enough.”
- RayRay at VREAA 1 Dec 2011 7:13pm

“Similar situation here … moved permanently but have started considering other options. Not asking for “free lunch” or “entitlements”, I will gladly pay for housing and a city premium, but YVR is off the charts. Have colleagues and friends with similar background in other cities and I can easily compare what value/cost you can get for your money.
People have completely lost perspective of the insane prices or what it takes to generate that kind of money. Prices are raised 100,000 – 200,000 without thought. Or crappy, expensive shoebox condos that would buy a house with acreage 30 mins. south are sold out. Insane, really.”
- Clipper at VREAA 1 Dec 2011 10:11pm

“I was in Seattle a couple of times last month. If you like city life and the west coast check it out. Nice houses in nice parts of town are half the cost of Vancouver or less. Hell, you can get a nice house in an inexpensive suburb for $250,000 easy. I’m seriously considering it as I could be mortgage free in my 40s if I go back to the States.”
- nobody you know at VREAA 1 Dec 2011 10:33pm

“People have completely lost perspective of the insane prices or what it takes to generate that kind of money.” (Amen)
RayRay, Clipper, nobodyyouknow -> How much would prices have to drop for you guys to consider staying? – vreaa