‘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.)”

“Why should I stay here and pay exorbitant RE prices when I can move to Oregon, make more money with my qualifications, enjoy a better climate, pay less taxes and buy a beautiful home for 500K?”

As markets reach extremes, more and more people become aware of the resultant disparities. Even though most of us prefer to stay put, the benefits of making a move start crossing thresholds that cause some people to take action. This from Peter Pan at greaterfool.ca on 21 Nov 2009 at 1:41 am -

“I’m looking to get the hell out of Vancouver and move to the US… Why should I stay here and pay exorbitant RE prices when I can move to Oregon, make more money with my qualifications, enjoy a better climate, pay less taxes and buy a beautiful home for 500K?”

“They were beginning to get freaked out by the prospect of losing their jobs while trying to pay their mortgages.”

This from logic at vancouvercondo.info 16 Nov 2009 3:53 pm -

“I was sitting in the Starbucks on the corner of Denman and Davie this morning, doing a bit of work and listening to a group of 4 construction tradesmen at the table behind me talking about all the layoffs in the places they work, and stating that they were beginning to get “freaked out” by the prospect of losing their jobs while trying to pay their mortgages. They were most worried by the fact that it’s not just the new hires being let go, but also people with “seniority”. I felt sorry for them, as they genuinely sounded worried, and seemed like nice enough guys.”

 

“Yes, the interest rates will rise, but my salary will also increase. If I’m laid off, or my mortgage skyrockets, I’ll work my ass off to keep it all together.”

Vancouver RE currently demonstrates historically record high price-to-rent ratios. Despite this, very, very low interest rates continue to make buying look attractive, especially if one only considers monthly payments. This illustrative example from Beth (2009 Nov 13, 20:27) in the comments section of the 12 Nov 2009 ‘Vancouver RE market bounces back’ article in the Georgia Straight, by Charlie Smith -

“My rent was $975 a month for a crappy, 35 year old one bedroom that didn’t have insuite laundry or anything, and where the landlord would knock twice then enter my suite without advance notice for non-emergencies, once even while I was on the toilet. Now, my mortgage is the same for a 12 year old one bedroom with laundry, fireplace, dishwasher. This includes maintenance fee. And I can have a pet. And no landlord can come in because he feels like it. Yes, the interest rates will rise, but my salary will also increase. If I’m laid off, or my mortgage skyrockets, I’ll work my ass off to keep it all together. I am confident in my ability to make it work. Downpayment? Some people work two jobs and weekends for years and years and years to save up for one; others inherit it when a loved one passes away; others borrow money interest-free from family, and others have it handed to them by well-to-do parents who would rather their kids have a condo than live in a dump run by a slumlord. Do you blame them? It’s not really anyone’s business where a downpayment comes from. It’s not a crime to have a downpayment.”

“The real story is how many jobs in hi-tech did this real estate boom kill? How many startups never bothered?”

Home owners have experienced paper and emotional gains from rising RE prices, and the construction industry has obviously experienced a period of boom. What is less obvious is that, for many, real estate prices have made Vancouver a less attractive city in which to live and work. Business have left Vancouver, or avoided it in the first place. Recent job cuts have people talking about this effect -

This from other ted at vancouvercondo.info 9th Nov 2009 11:11 pm -

“Let’s face it Kodak Canada is what is left of Creo. The [major] job cuts were in 2002 and 2003. There is almost nothing left there now. I don’t think I know anyone left working there, maybe a few. It won’t make a difference. The real story is how many jobs in hi-tech did this real estate boom kill? How many startups never bothered? How many real jobs vanished or were never created? The damage is done. Seriously, crash or no crash I can’t see myself moving back to Vancouver.”

This from patriotzed at vancouvercondo.info 10th Nov 2009 4:49 am -

“I took a high-tech management program from SFU back in the late 80’s when it looked like Vancouver had a real future in high tech. Our focus companies were Glenayre and Creo. For a metro to be a growth centre for high tech, it must be attractive to professional families. Vancouver was in the 80’s and 90’s and that’s the major reason why capital and workers were attracted here for the many startups. Make the metro unattractive, and you kill high tech. Housing in Seattle is a good deal cheaper than in Vancouver, and it is and has always been a major high tech hub – why on earth would anyone locate here instead of there, except to employ a few peons who couldn’t get H1B’s? Inside Canada look at Ottawa, or Waterloo, which are even cheaper. If housing gets down to and stays at 80’s real prices, high tech may get going again, but it looks like we’ve slipped back 20 years or more.”