Low Retirement Savings + High Homeownership = RE Sales

53% of Canadians plan to keep working ‘after retirement’.
A further 29% ‘said they were not sure if they would work after retirement’.

Almost half of today’s 50-59 year olds have less than $100,000 saved for retirement.
“The retirement landscape is shifting as baby boomers reach traditional retirement age with a smaller nest egg than they expected to have.” – Christina Kramer, executive vice-president, retail distribution and channel strategy at CIBC.
– from a national online survey (n=805; 5-8 July 2012), conducted last month for CIBC by Leger Marketing. As reported in Globe and Mail 20 Aug 2012, and numerous other news outlets.

Bank of Nova Scotia economist Adrienne Warren says that when the latest census figures come out next month she expects us to be in the elite company — depending on your view — of countries with more than 70% of households owning their own homes. Based on the 2006 census, we were at 68.4%. … Interestingly enough, the United States is believed to have cracked that 70% threshold before the bottom fell out of its housing market. … “The government is saying you should not be a homeowner if you cannot afford it,” said Benjamin Tal, deputy chief economist at CIBC World Markets Inc.
– from ‘Home ownership in Canada reaching new heights’, Financial Post, 17 Aug 2012

A large number of underfunded homeowner boomers will be heading for retirement with their only substantial asset falling in value. This will add to supply and plunge RE prices further.
– vreaa

18 responses to “Low Retirement Savings + High Homeownership = RE Sales

  1. Mr. Brett Carels

    Im enjoying your emails thoroughly. I’m curious though, why are you putting in the effort to run the blog? What is your motivation?

    • he wants harmony!

    • Change can only come with awareness and knowledge. To save people before they put a noose on their necks.

    • Perhaps it is to provide evidence that, should a bubble turn bust and the inevitable caws of “nobody saw this coming” start gaining volume, it’s a simple 19 character rebuttal.

      For those looking for more hilarity, google searches for pundits’ previous statements and predictions are made simple. Think of it as a framework for a copycat version of In Our Time (not least because of the bullfighting references 😉 ).

    • I actually disagree that “Change (in RE – my comment) can only come with awareness and knowledge.” It is going to come anyways because of the fundamentals detachment from the RE prices – i.e. there is no customer base to support these RE prices – The ownership rates are to high and the salaries are to low. So strictly saying any talks/blogs should have very negligible influence on the bubble behavior comp. to the economy of the process.
      It would have been interesting to read the answer from the host himself:(

  2. I can’t speak for the host, but I imagine that providing a contrasting view point to the constant Pro-RE propaganda we are bombarded with in Vancouver is a large factor.

    Once you awaken to the fact that developers run this city, it becomes pretty satisfying to expose the players for whom they are.

  3. Would also add, if retirement age workers do not retire they are occupying valuable jobs and therefore inhibiting younger workers from advancement opportunity. Those younger workers, needing more income to pay for the cost of living look elsewhere for work, ie out of city/province/country.

  4. this site is ‘social media’. Traffic here builds a statistical profile that can be leveraged by data gathering companies. We come to this site for the same reason a person may want to observe a Hanging. Vreaa understands this and has decided to sell ‘hotdogs’. We enjoy the hotdog while we discuss the colour, texture, and fabric of the hangman’s rope, how nicely it fits around the neck (or doesn’t). We observe the condition of the doctor brought in to pronounce the death certificate. Is the doc drunk, sober, … will something spectacular happen at the critical time when the trap door opens? We watch. Some of us are interested in that rope, how many times does it get recycled before a we see a new one?

    • i thought we wanted a shrubbery (?)

    • I wonder how many HAMs were outbidding each other for the rope? Is the rope near a hospice? Can you rent out the rope?

    • My goodness you have put a lot of detailed thought into a hanging, a slight fetish perhaps ?

      I would disagree with the hotdog selling, unless he/she/it is selling the data for commercial value. I would prefer to look at VREAA as a recorder or timecapsule of the folly that has become Van RE.

  5. This site is a labour of fascination, but, at the same time, it isn’t really a labour.
    When the most extravagant carnival visits your town, how can you not stare in amazement?
    And, yes, the idea of a chronology; a time capsule; an evidence trail — for the inevitable ‘hoocoodanode?’ moments to come. (Well, ‘ucoodanode’, we all did.)

    And, BTW, there is no commercial activity component to the site, and no ‘data mining’ going on that we are aware of (other than the fact that there is a record of all the comments). The host is wordpress.com, and vreaa actually pays a small annual fee to keep ads off the site (it should be ad free to readers, let me know if it’s not).

    Ironically (given that its arrival has been anticipated for years), as the spec mania implodes, we foresee that it’ll get a lot less fascinating to watch, and sadder, and distressing to follow. We intend to continue to record the anecdotes, for the anticipated full story arc.

    • Thanks VREAA for this platform. Before internet no form of media could have really capture the people’s sentiment/news/facts/opinions/struggles/judgments etc while we rode the real estate roller coaster up and down.

  6. The HAMs were out in force tonight at Garth’s big event. Baby HAMs that is, the ones you see in the line-ups. Hard to figure how they understood what was being said when they could barely articulate a question. Most stunning was the realization by one questioner that you might have to pay taxes on rental income. Stunning ignorance.

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