“About a year ago someone bought the house and did a total reno. Then the house went on sale for months with no takers. Then off the market. Then on sale again. Now they are tearing it down. No attempt to salvage anything.”

“Talked to an old friend in Burnaby today. About a year ago someone bought the house next door and spent several months doing a total reno. Then the house went on sale for months with no takers. Then it went off the market. Then it went on sale again.
And now they are tearing it down. No attempt to salvage anything. Remember in decades past you could drive around the city and go to the demo sales where they spent a week or two selling off the fixtures and stuff first.
This is wholesale destruction of wealth. Question is who took or will take the hit – the previous owner, the builders, or the next owner, or some combination of the above.
It’s doesn’t get any crazier than this.”

patriotz at VCI 29 Jun 2012 1:01pm

“Wholesale destruction of wealth”, agreed.
Part of the terrible misallocation of resources that is part of a speculative mania.
It should be obvious to all that this is bad for our society.
– vreaa

15 responses to ““About a year ago someone bought the house and did a total reno. Then the house went on sale for months with no takers. Then off the market. Then on sale again. Now they are tearing it down. No attempt to salvage anything.”

  1. Village Whisperer

    But… But… GreatChina says developer is doing “a great service to community”?

  2. It indicates to me the reno quality was so poor it wasn’t worth salvaging.

  3. it is so easy to make money flipping houses… buy and reno and sell… I hear on radio ads, (cknw) some shill yapping about how easy it is to make money flipping and Vancouver is prime area… HMMMM are there still that many suckers out there??

    • No, no . . . as you can see from this example: buy, demolish, rebuild, and sell. That will be the way to true wealth in Vancouver in the days ahead.

  4. Perhaps the property owners’ introductory economic studies unduly featured Schumpeter? [BadumpBadump… CymbalSplash]….

  5. Anyone got a copy of today’s Province handy? Article in Money about a HELOC addict who feels the rug just got yanked out from under her. I can’t find it online with a quick search, but it’s out there and deserves a mention here. With a line or two of text you will find it, Google it with the exact sentence inside quotes.

    • too much debt

      is this it?

      http://www.theprovince.com/business/Living+within+your+means/6874827/story.html

      Q: We’ve always used our line of credit to pay our bills and credit cards. We’d then refinance our mort-gage to pay off our line of credit.

      We’ve never had trouble making our mortgage payments so we were a little surprised when the bank told us we don’t qualify for our usual refinancing. Now we’re not sure what to do because our credit line is maxed and it’s only a matter of time before we can’t afford the payments. Help!

      A: Over the last number of years, interest rates have been low for lines of credit and mortgages. During this time property values in many regions increased, giving homeowners access to a lot of “artificial” equity.

      The federal government became concerned about the increase in mortgage debt and has tightened up borrowing rules for certain types of mortgages a number of times since 2008. The most recent change, which takes effect July 9, reduces equity takeouts from 85 per cent to 80 per cent.

      This means anyone with a mortgage insured by Canada Mortgage and Housing Corp. cannot owe more than 80 per cent of the value of their home when they refinance their mortgage. This change will affect countless people who have been relying on their home as a money tree.

      To deal with your debt situation more effectively, I would suggest:

      ? Create a budget. Living beyond your means by relying on credit is not sustain-able.

      ? Track your expenses to find out exactly what you’re spending and start reducing where you can right away. You need to balance your budget, which means not spending more than you earn.

      ? Prioritize your debt payments. Essential payments are typically at the top of the list such as your mortgage and car payment.

      If you don’t have enough money to make all of your payments, start seeking help to consider other debt consolidation options. There are a number of debt consolidation options our credit counsellors discuss with clients every day. These include loans, mortgage refinancing when possible, credit counselling repayment programs, settlements and consumer proposals.

      If clients have assets they can sell it may be worth cashing in some investments. They may also be able to use their home to generate a little extra income.

      Above all, get help sooner than later. You’ll have more options and you won’t need to worry because you’ll have a realistic plan that helps you manage.

      Read more: http://www.theprovince.com/business/Living+within+your+means/6874827/story.html#ixzz1zby1bMAN

      • Priceless.
        I’m both frowning and laughing at the same time. Gotta love the “paying off” these guys were doing with serial debt-steps.
        Thanks to Alex and TMDebt… will have to headline, natch.

      • Alexcanuck

        Yeah, that’s it.
        Now we’re not sure what to do because our credit line is maxed and it’s only a matter of time before we can’t afford the payments. Help!
        Whocouldanode!

      • Oh my.

        Can’t say even He who taketh away didn’t give some advanced warning.

        PS here’s a favourite statue of mine. Not sure the title, but I thought “consoling bear” might be appropriate.

        Points to anyone who knows where this is.

      • What’s funny is their shock at suddenly not being able to roll their debts into their HELOC anymore. They just assumed they’d be able to do that forever. No doubt the ol’ HELOC paid for more than a few vacations and new cars. I love how they are now getting advice like, “Create a budget. Prioritize the paying down of debt. Identify areas where you can cut spending.” Like these are new ideas they need to start looking at. I’m LOLing, but at the same time, dreading the macro-effects of this forced deleveraging as it plays out over the next decade or so. Multiply these idiots by many hundreds of thousands of households across the country (yes, it really is that bad, I know people financing their fast lifestyle exactly the same way). It’s going to be a miserable, grinding recession methinks. I hope I’m wrong.

      • Jesse – is the consoling bear near the library at King Edward & Knight street?

      • Absinthe, you own the podium!

  6. In the crazy market that’s been, it was the buyer who absorbed the financial hit. Those days are over, though I suspect the owner of this house hasn’t discovered that yet.

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