The Financial Post publishes an article titled ‘Why we’re in trouble if housing craters’, by Tim Shufeldt, FP, 23 Feb 2012.
The ensuing comments:
“Real estate prices in Canada have to come down, because it’s not different here…” – Rafinator
“It’s bad enough that the market can create bubbles on its own. It’s much worse when the government creates bubbles.” – NewWorldPartDotOrg
“Housing bubble is there in Canada and will collapse soon.” – Nickk
“In my experience, many foreclosures are the result of divorces and not just job losses while prices rise since two houses are now needed instead of one.” – Green is the Colour
“As was the case in the United States, certain of Canada’s real estate markets are becoming increasingly less affordable by average families. As shown in this article, out of 35 major real estate markets in Canada, only 9 are considered affordable with 6 being considered severely unaffordable when measured in terms of median price to median household income.” – Georgiaorwell84
“It’s too late….we’ve already passed the point of no return a long time ago. Everyone who’s in debt may as well borrow the rest of their margin and throw a big party. Go out with a big bang…….” – TOC
“Tell us something we don’t know.” – Mithan
—
That’s it. That’s all the comments.
At FP, not some loonie bear blog.
We know what’s up folks.
All it’s going to take is a price move to the down-side, a decent shove, and we’re off down the bobsled run.
Everybody, out of the pool!
– vreaa
Vancouver Real Estate Anecdote Archive 
The FP IS a looney blog, part of a newspaper that I like to call The Notional Past, “Harkening back to a mythical time that never was”
See the writer’s latest, title in link says it all: http://business.financialpost.com/2012/03/02/why-is-canada-keeping-out-chinas-rich/
No one wants to know that the greyhound psycho and the butcher of Mao Jomar Lanot were born in the same village. Allah is looking the other way.
I think this year is just the beginning and will more likely affect condos, new construction, and some suburbs. East Van is picking up some steam as sales are strong again. Bidding wars continue and sales are up significantly over last month. Richmond sales are down significantly, and the average price from the peak is off about 100k. This has been a long frustrating wait.
East Van will be like one of those islands in the Pacific where they still find soldiers fighting WWII. Let them have their joy, such a long, long wait.
Outraged by a building envelope failure and ensuing SpecialAssessment in their leaky RichmondCondo… Toshira Mifune banishes partner Lee Marvin from their ‘love nest’ and subjects to him to an involuntary, punishing taste of BC weather….
Looks like the ‘garden suite’ with 1.5 baths and custom granite countertops… nice.
What? You mean blogs about real estate are redundant now……that I can get all this good information right out of the mainstream press? Holy Cats. I might just get a newspaper subscription (not likely).
The thing is, the papers don’t give us the straight goods. They only offer the usual pablum that has been predigested for us. The assumption in news rooms seems to be that typical readers can’t make sense of data and charts.
Can you? Well then here is the latest housing market release from Corelogic, a California company that analyzes broad swaths of data including home prices. The latest report is a doozy. Even more Americans are falling into negative equity today than just last quarter. Foreclosures are expected to rise.
If this is also our future too then we had better pay attention. Says Corelogic:
” ….Negative equity data shows that 11.1 million, or 22.8 percent, of all residential properties with a mortgage were in negative equity at the end of the fourth quarter of 2011. This is up from 10.7 million properties, 22.1 percent, in the third quarter of 2011. An additional 2.5 million borrowers had less than five percent equity, referred to as near-negative equity, in the fourth quarter”.
http://www.corelogic.com/about-us/news/corelogic-reports-negative-equity-increase-in-q4-2011.aspx
Things seem to be worsening. Now check out the chart for an eye opener. What it shows you in essence is that virtually every State has homes in negative equity. Some of the percentages are mind numbing. In Nevada for example, fully 61% of all mortgaged homes are underwater. Yeah, its that bad.
So while we may “know”, I do not think most here are really prepared nor understand what a housing correction will mean to them in real terms. Real estate is risky. Is it worth waiting to be one of the economic casualties though?
Gleaned from the Corelogic article, immediate defaults would come from those related to the housing sector itself due to the loss of income component.
Yup, the report is a wake up call. What I see when looking at how the US bubble burst is a glimpse into our own future. It is still an unwritten future of course and none can know the extent of the damage this country might endure. By the looks of it though we are skating on thin ice.
The whole negative equity issue shows us that no city or State escaped unscathed. If anyone wants to say that “it’s different here” where bubbles are concerned then just hand them the neg-equity chart and invite them to shut up.
Of the 11 million underwater homes, 7 million have an average negative equity of 50,000 dollars. The other 4 million homeowners are averaging 85,000 in negative equity. Big numbers to some. If you don’t have savings though, do not bankrupt or can’t get a short sale you are trapped in your debt.
And that is just where 11 million American homeowners find themselves today. Case-Shiller numbers meanwhile confirm that home prices are still falling so this clearly has a long way to go before home price appreciation kicks in again.
It is easy to see why a serious correction run a decade or longer.
I can’t believe it’s come to this. Contrarian wisdom has spoken, Vancouver is the new Monaco. Get ready for another 20% boost in 2012!
You may be right about further increases, but it’s still far from Monaco.
In Monaco, you will be lucky if you can get a tiny studio under $1 million. Vancouver has a long way to go.
hahahahaha, mon ami, so naive. There is No income tax in Monaco, No capital gains tax, No wealth tax, and No property tax. Please do come again and visit our shops and boutiques. Deo Juvante!
I think you missed the intended sarcasm. Please see the following:
https://vreaa.wordpress.com/2010/09/11/five-charts-predicting-future-vancouver-housing-prices-with-the-aid-of-technical-analysis/
Not an easy problem to solve, reading the National Post.
What a strangely written FP article though. It is cobbled together from the bank of Canada quarterly review articles, but fails to mention that, instead repeatedly referring to “the report”. It feels like the subject was so scary and unbelievable that the poor fellow lost the ability to communicate. The paucity of comments may have been due to the inability of readers to make it through the article.