What happens to vocal housing bulls after a RE bubble pops?

“You know the exploding rate of Foreclosures? It’s actually quite funny. With it being about the Okanagan, that is.
From about 2005 onward, I posted quite a bit on the Castanet forums (the local news site) about how Kelowna home values were wayyy too high, and that we were in for a catastrophic collapse, and that the rate of foreclosures would be one of the first signs of an impending collapse.
From the moment I started to post on their forums, I was overwhelmed by bubble deniers who openly mocked me. There was at least a 20-to-1 ratio of bubble deniers that openly refused to believe that home prices could ever crash, compared to those who said I might be right.
In fact, one of my threads (started in December of 2007) became one of the biggest ever on Castanet (5,665 posts) before someone politely asked to have all threads dealing with Real Estate deep-sixed into the smallest, deepest and least-visited part of the forum. Even though most of said threads were clearly about Kelowna, and had nothing to do with the “Economic Crisis” category they were thrown into.
In the end, the subject ended up getting as many visitors in a month as it used to get in a single day when it was in the Kelowna category of the forum, so it was painfully obvious to me how loudly money talks, especially money of the advertising variety.
What I find so amusing now is how so many of the hard-core bubble deniers have been quietly changing their tune, even up to the point of denying that they were ever bubble deniers. Yes, Dirtrider, I’m looking squarely at you. Nice for you to finally realize that things are NOT different here.
Oh, and that news article that is all over CBC.ca and other news organizations, about how the number of foreclosures in the Central Okanagan have pretty well exploded? Not a sign of it on Castanet’s front page yet as of 2012-02-15 1841hrs UTC-8. In fact, a Google search shows that the news isn’t even on the site, just on the forums.
And yet, they’ve got OMREB-authored “news articles” about increased housing starts in the North Okanagan.
Oh, yeah. Money talks, all right.”
René Kabis on at greaterfool.ca 15 Feb 2012 at 10:47 pm

“What happens to vocal housing bulls after a RE bubble pops?”
They disappear.
Worse, they tell themselves that they saw the crash coming.
No, seriously. That is what happens.
The wonders of the human psyche at work.
– vreaa

36 responses to “What happens to vocal housing bulls after a RE bubble pops?

  1. Royce McCutcheon

    Might be worth writing dedicated posts chronicling media comments from the more consistent pumpers over the years. The media will continue going to these people when the market really starts turning and they’ll be able to shift their tone/message with each interview. As public sentiment moves, it would be nice to one-stop-shop for quotes from key players. Might be the best way to actually get accountability (or perhaps influence the media to seek other voices).

  2. I hope Kelowna gets more press in the coming year, for it has a good chance of being something unheard of in post-GFC Canada: a US-style market meltdown.

  3. The same thing will happen on RET.
    ETB and jimtan (dumtan) will be telling us how they saw it coming all along, lol.

    • In fact it’s starting to happen already.

      A recent dumtan post in regards to a graph showing the FV has moved to a buyer’s market.
      “Back in the buyer’s market again?

      Not surprising. See some price resistance in the better condos. Might take a while to clear.”

      He’s not surprised??? After all the pumping he’s done the last two years?

    • You are dumb. Prices are rising as we speak. Look at the avg price for Jan. up up up. Like last year. Mainlanders keep coming and expect Koreans to flood in with HAM. Illegal money from Asia will keep prices up. You idiots here don’t know s.hit. Watch and learn losers. You guys are all renters for life hahaha

      • HaHaHaHa HaHaHaHa HaHaHaHa….oh shit that was too funny Poco. So now it is Koreans. Next it will be Martians or guys from Zimbabwe or even packs of wild dogs. HaHahahahaha!!!!

        Maybe we will buy your house on a foreclosure and then kick your sorry ass out onto the street where it belongs. Just waiting for the moment.

      • poco brother, Only fear need insult. Now you’re a market indicator.

      • The comment about South Korean immigration puzzled me, because I was aware they have the lowest birthrate in the world, so I did some checking. Currently, Korea is sponsoring foreigners to come to Korea. The workforce is dwindling and they are repatriating Korean nationals living in China. Many welcome this opportunity to return to Korea. If you want to bring technical and industrial skills to Korea, their policy of ethnicity is weakening in favor of more immigrants. Foreigners account for about 1.6 mil people and is expected to grow. So, my friend, your claims are quite the reverse.

        source: presstvmobile

  4. But it’s still worth sticking around the forums; while many “bulls” will be keeping silent more than a few will be reading. You owe it to them to spread the news.

  5. ETB @ RET is the biggest bull in the RE world. I just want to see her posts after the crash. What a cherry picker she is. If you are reading this ETB, post some comments here because Ozzie won’t let the bears in except for Taipan.

  6. Um, they get blogs dedicated to them?

    Of course, the really bullish ones (you know, real estate agents that own three investment condos, etc.) are so broke that they can’t even afford internet connections, so they go silent.

    • It is the true believers I feel most sorry for. Those are the folks who walk the talk so to speak and buy their own lines. At least they cannot be faulted for lying to others if they truly believe the hype and lose thier shirts in real estate along with everyone else.

      No, it is the bare faced liars I cannot stand. Like bank economists who assure us everything is OK while they quietly list and sell their own property at the top.

      And it is the realtors who disgust me. Those who guiltlessly lead younger people into making a huge financial mistake while they secretly dispose of their own spec bets and get out of the market. They are manipulators whose only ambition is to earn one more commission before the party ends.

      In our hearts we know who the real rats are though. The BS bulls and big talkers are smart enough to make it look like they were right whether the market rises or falls. They will NEVER apologize for being wrong or admit they made a mistake……so where do they go?

      Well they become Repo men, collections agents and auctioneers. They make you miserable all over again. It is the same people you know.

      • There is a difference between a person believing the hype and not caring if it’s true or false. A nice essay on BS- http://tinyurl.com/bxtbyg

      • That was a good chuckly nonymouse. It was just a matter of time before someone tried to dissect the various aspects of bullshit into their component parts! For me, I will stick with lumping all the liars together.

  7. I used to post on the that same Castanet forum – and many an argument with the aforementioned “Dirtrider”.

    It was a frustrating debate. Most people in Kelowna wouldn’t believe that prices could go down, and this was while the housing market was already tanking right before their eyes.

    Last year there were already numerous condo developments that were 40-50% off their pre-sale prices, yet people were still in denial. Have an aqquaintance whose waterfront condo was bought for 680k in 2007 and is now worth about 350k (the identical unit 4 floors up just sold for 370). They want to move to a house, but can’t, because they can’t afford to sell.

    People are finally starting to take notice, but the average person still can’t see the writing on the wall. They think prices have been flat and will remain flat, but prices are already off about 20%. Inventory rising. Sales numbers stagnant or dropping.

    The same argument about Canada’s “sound” banking system is always the fallback, but as foreclosures spike then that sentiment might finally change.

    When the general sentiment finally reverses course Kelowna could easily be Vegas North.

    • You got that right Jay. Crea meanwhile keeps insisting this is a balanced market. Prices are flat suggesting that equal numbers of buyers and sellers are in the market. Too funny, man. More like it is balanced on a kinifes edge and this is the calm before the storm.

      You know that when you look at a bubble chart. Right at the top there is a place where you can see calm. Just as the market is slowly rolling over there is perfect balance. Nothing is happening at all.

      That is the Wiley E Cyote moment.

  8. Told-you-so-in-2007

    Speaking of the “Wiley E Coyote” moment: on the international scene, news of this baby is really starting to get rolling, isn’t it?

    “Canada Housing Poised for ‘Severe’ Drop”

    • Some quotes from that article:

      Canada may be on the cusp of a “severe” housing correction as real estate investment surges above a tipping point relative to economic output, according to George Athanassakos, professor of finance at the Richard Ivey School of Business.
      “Eventually, everything boils down to demand and supply,” Athanassakos said in a telephone interview from Western University in London, Ontario. “Whenever this ratio goes over 7 percent, it signifies overinvestment in housing and two or three years later, we have a severe correction.”

      Canada’s housing market is booming as historically-low interest rates fuel purchases, driving up home prices and adding to record household debt. Canada’s ratio of housing investment to GDP has averaged 5.8 percent over the last 50 years and is currently at about 7 percent, based on Statistics Canada figures as of the third quarter of 2011, Athanassakos said.
      “We have experienced bubbles and busts before in Canada, it’s nothing new,” Athanassakos said. “I don’t know why this time would be different.”

      Glad to see that this finance professor has more professional integrity than our UBC Tsur…

      • Makaya, gratitude is life’s shortest lived experienced. You cannot inculcate integrity in some. People came here to work hard and live a productive life. One successful businessman who started a factory here in the 80’s, sold it 20 years later to international conglomerate. He has passed his retirement age and his sons have their careers. Whenever he visited my dad, we talked about the housing madness, he shook his head.

    • Thanks told-you-so! The chart suggests we are headed for a 1983 moment in Canadian real estate (that is bad). But it is convincing. It does not even begin to address the fact that this time it will be happening during a global slowdown though as EVERYONE else is trying to deleverage at the same time. Chinese banks included. That means it will be really, really bad. The folks who have been calling for 50% price declines might just be proven correct. Hell, plenty of cities in the US saw those drops and more. Are we more special or immune than Americans? Don’t think so.

      Hope the editor makes the Bloomberg article todays anecdote.

  9. Just going to leave this here. I think someone believing this is more scary then the pumpers whose job depends on it.

    formula1 | 15 February 2012 at 2:28 pm |

    we don’t have a step up property ladder at the moment, it’s step down.
    This is why we have so many angry people – everyone is being displaced by the top 30% of our market which is being bought in cash by first time buyers who don’t need the traditional property ladder.
    It’s difficult to make property ladder work under this scenario – but impossible if you don’t take any steps at all.

  10. “Do they read Bloomberg in Asia? Maybe we should fly someone over to buy up all the copies. Dang, it’s on the net.” – Office of the Premier.

    4000 listings over $1mil from Bowen to Abbotsford, or 30% of CMHC total equity.

    I’m getting that weird jingly feeling that bone pickers get.

    • Told-you-so-in-2007

      “Do they read Bloomberg in Asia? Maybe we should fly someone over to buy up all the copies. Dang, it’s on the net.” – Office of the Premier.

      Bwahahahaha! No, no one reads Bloomberg. 😉


      Seriously, though, Farmer makes a great point about the fact that this deleveraging cycle is a global one. What will be the driver that pulls us out of this one? The cheap credit hands have been played.

      • Wait til US citizens start camping out in front of Fort Knox. We’ll know if they open the doors for a look see. But I fear they’ll find an echo chamber.

        In The Wizard of Oz (ounces), the facade of Emerald City was a metaphor for the greenback, and in the book, Dorothy’s slippers were silver.

  11. CanuckDownUnder

    We are so lucky to have archives like this (thanks vreaa!) because all these vocal pumpers will disappear or change their tune and most people will either not notice or just not care.

    It’s amazing how abrupt these changes can be, just last week my favourite Aussie pumper Dr Wilson (I’d say he’s our local Tsur except he’s not an “impartial” academic but the talking head of the media-owned property data provider so you know what you’re getting) managed to explain how both rate cuts and rate holds were good for the housing market in a span of days. No doubt rate rises are also good for the housing market.

  12. I love Kelowna. But over the past decade they’ve developed the delusion that they’re basically the Second Coming of California…

    …and now, seemingly, the are. But for all the wrong reasons.

  13. Holy Crap. I never thought one of my anecdotes would make it onto this site…

    Too bad the formatting of the original post wasn’t preserved, though. It would have made for easier reading.

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