“Give me strength and stop me from stabbing them both with my fork.”

It is often lonely to be a contrarian. Bears who see the Canadian RE bubble for what it is are emotionally depleted and extremely frustrated. This bear exhaustion is sometimes taken by contrarians to be a sign of a market top. To be fair to the bullish argument, however, is to note that some bears in Vancouver have been exhausted for years.

This from Jonas at greaterfool.ca 30 Nov 2009 at 12:06 am -

“I was at a dinner party and a stupid couple that recently bought were there. Someone other than me had the sense to ask  “What if the rates go up?”. (There is a god, I thought.) Then the morons actually said they think that rates will go down from here, and stay down for years. Give me strength and stop me from stabbing them both with my fork. I attempted to explain that rates were basically zero and Carney has already alluded to the plan that he will begin to raise rates at some point in the summer, but why fricking bother? About half of the people thought that prices will continue to rise as the economy continues to grow. I tried to explain that rates are historically low, will not go lower, and that incomes are flat to down, and that employment is down and getting worse. I asked them where they thought house prices would be when the variable rate is 5% and rising, and the fricking dumba$$ actually said higher. I swear to god it’s like living in a bad zombie movie. They are every where, stupid people without a brain that God gave a gnat. These will all be the same people with their hands out when the shit hits the fan, and [every] last one of them with a surprised stupid look on their faces will collectively say “Wow, huh… I didn’t see that one comin’”

“A ’single family dwelling’ in Vancouver will more than likely have at least 2 households, I’ve personally seen 4 per house.”

This from bgard at greaterfool.ca on 22 Nov 2009 at 2:08 pm -

“I own a very similar house [to recently featured 265 East 24th Ave], probably in the same neighbourhood. In fact when I first saw the picture I thought it was my house. Even have a similar colour scheme…though mine is much nicer. Nicest house on crack alley as my wife likes to say. But on to the meat. My taxes (on an assessed value of 700K) are 5,000/year. Hydro and Gas are 3,000/year, for the 3 households that live here, same as in the example. Plus 1,000 for insurance. A ’single family dwelling’ in Vancouver will more than likely have at least 2 households, I’ve personally seen 4 per house. So you have to factor that in to the overall cost of RE. And taxes never go down. I’ve owned for 12 years and seen my assessments drop twice, last March (when assessments were done at mid dip) and from about ’98 to ’00. I have always paid more each year.”

Herb adds at 5:56 pm that in Ottawa, a 475K house has annual taxes of $6,140 and utilities of $5,200.

‘Real Life’ – “This week I heard this…..”

This intense concentration of anecdotes breaks all records for efficiency of story telling on VREAA. Please send your own observations. Here’s Real Life at vancouvercondo.info 21 Nov 10:43 am -

“This week I heard this:

1. Hotel in Whistler – “last year was bad, this year is worse” (Global TV)
2. Fitness Centre in Fraser Valley – closing after 12 years (friend works there)
3. Condo back on market for -20% than paid 18 months ago (FTB friend)
4. Hours cut by 50% (friend that is an electrician)
5. Renegotiated rent (friend had landlord reduce rent from $1250 to $1050 in Chilliwack – for 1 year old 4 bedroom house.)”

“My wife, young daughter and I are quite content to rent a place for $1,450 a month that would easily list for $700,000 (and probably go into a bidding war to sell for more).”

This from Contrarian in Vancouver, on greaterfool.ca, 20 Nov 2009 11:54 am -

“I live in Vancouver. My wife, young daughter and I are quite content to rent a place for $1,450 a month that would easily list for $700,000 (and probably go into a bidding war to sell for more). Our landlord arranges for the lawn to be cut, landscaping taken care of, and immediately takes care of any repairs. Got to admit, he’s great…kinda makes me feel like I’ve got it too easy. We’ve got a couple hundred thousand sitting on the sidelines in safer investments earning a little interest (aside from our RRSPs which are very diversely invested, life insurance and no debt).  I’m a 40 year old investment advisor with a contrarian and value based philosophy. As I tell my older clients when recommending laddered GICs as part of their portfolio, it’s not just paying 3.35%, you’re getting 103.35% as you know you’ll get your money back. Can’t say that about many investments these days – especially real estate. Heck, the cap rate’s got to be close to that but the risk is huge (oh wait, I forgot real estate only goes up!! – Hasn’t anybody looked at a graph of real estate in Vancouver for the last 40 years?) Luckily for me most of my clients are much older and have no debt. Bad for them is that their kids (in their 50s) can’t say the same, and of course it gets downright worrisome when grandkids (who are in their 20s and 30s) situations are brought up.  Meanwhile the plan for my family is that we’ll keep socking away into our RRSPs, keep building our down payment and in a few years when the @#!$ is really hitting the fan, pick up a pretty nice place and pay it off in less than 10 years. (Hopefully the banks won’t have a problem accepting a 30-40% down payment then! lol).”

“I’m single and have a salary that is in the high five-figures, which puts me up in the top 20% of households in Vancouver, yet I can’t afford to purchase a SFH in East Vancouver.”

This from oneangryslav2 at vancouvercondo.info 18 Nov 2009 11:42 am -

“Please let us in on the secret. How is it that people can afford million dollar homes? I still don’t get it. I’m single and have a salary that is in the high five-figures, which puts me up in the top 20% of households in Vancouver, yet I can’t afford to purchase a SFH in East Vancouver.”

“It is annoying to see almost all our friends have moved to their new houses recently. Our hearts sink every time we hear mainstream media telling us next year housing price will continue to go up.”

The real estate boom has shut out some prudent citizens who would, under more normal circumstances, be homeowners. Some feel despair, others great inconvenience. Some gain solace from local and national real estate blogs, in the following case, from Garth Turner’s greaterfool.ca. This post by ‘Mom Society’ at greaterfool.ca 16 Nov 2009 10:33 pm appears to be an update and elaboration from the same poster whose earlier thoughts are archived at VREAA 7 Nov 2009 -

“We desperately want to buy a place with a yard as we have an 18 months old son and he needs a place to play. Although our annual income is around $15,000 more than average, we still find we can not afford anything with a yard, even in Surrey. It is annoying to see almost all our friends have moved to their new houses recently. Our hearts sink every time we hear mainstream media telling us next year housing price will continue to go up. Actually we don’t care if your [Garth Turner's] prediction would be accurate, no one has crystal ball. At least your blog gives us hope in this raining winter, give us a hope to allow us still dream we may have a home with yard in the future. Thank you. If we are belonging to middle class or working class, I feel [we are not alone in] our sadness.”

“We dare not dream to buy a home in Vancouver. We feel shame to be poor and working poor.”

This brief yet poignant personal story about the feeling of being left behind by this RE bubble. From ‘Mom in Vancouver’ at greaterfool.ca on Nov 07, 2009 at 1.48 am -

“We dare not dream to buy a home in Vancouver, actually we can not afford anything with a yard for a kid to play in, in Surrey, or Maple Ridge, although I worked for several years as a full time programmer. We feel shame to be poor and working poor.”

“I keep trying to tell my wife that Vancouver is a city living on credit and home equity loans, the music will stop soon. She doesn’t buy it anymore.”

This account of RE related spousal discussion from DaMann at vancouvercondo.info Nov 6th, 2009 at 12:01 pm -

“I really don’t get this silliness. My wife says “I don’t care what anyone says, there is no recession in Vancouver”. All she comments about is the wealthy cars, and stupid prices of RE. I keep trying to tell her that Vancouver is a city living on credit and home equity loans, the music will stop soon. She doesn’t buy it anymore. She IS starting to believe it’s different here. Shit, so am I!!!??!?!? EVERYTHING is defying all logic and reason. Sure, I know people are buying places based on variable rates of 2% but even at that, I still can’t fathom how ( or why) people are buying and getting $700k mortgages on $100k household incomes. Man I can’t wait for rates to go up!”

“Her partner seems to be doing well in therapy/personal growth work, but they sure can’t afford a house!”

So, who is buying? This from Ginger at greaterfool.ca on Nov 5 at 12:07 pm -

“I think the new-agish health industry is big (in Vancouver), my sister used to be a yoga teacher there, but after being away for a few years, was unable to get back into it because of saturation in the market. Her income from waitressing has gone down too. Her partner seems to be doing well in therapy/personal growth work, but they sure can’t afford a house! And these are 2 people with university degrees. I guess the beauty and climate make it worthwhile.”

“We are holding our breath and keeping our happy little family of three in a 1 bedroom 560sqft condo in Kits”

This from ‘family of sardines in Vancouver’ quoted on Garth Turner’s greaterfool.ca blog, October 29th, 2009 -

“We are holding our breath and keeping our happy little family of three in a 1 bedroom 560sqft condo in Kits (that crazy Realtors have priced at $400,000) and waiting for the day when the cash we’ve saved up will be worth something a wee bit larger. While the Realtors keep telling us to fear the rising interest rates, the math doesn’t work – how do you justify bidding up an already overpriced home by another $200,000? I’ll keep working on the down payment, take a raise in interest rates, forget the bidding war increase, and possibly have a more reasonable price instead – thank you very much!”