“Would I buy in this market if I was in a “normal” situation? No. Does selling now and renting make sense for my family personally, given our current situation and lifestyle? No. Ergo, we’re staying put.”

“We love our house and location, will have paid it off entirely (and way early) in a couple of years, and will be able to put all the money we currently pay in mortgage into funding an early retirement. We’ll still have property taxes and maintenance, but it’s a helluva lot less than we’d pay to rent a similar home in our neighbourhood, and these costs can be covered completely by renting out a spare room for a few months in the summer to an international student if we want to do that (we have done it and enjoyed it in the past, so it’s familiar territory). Our family is in Van, so are both our jobs, so moving to another city makes no sense. Another reason that I am not interested in renting, besides the potential issues with crappy landlords, instability and the lousy quality of a lot of rentals I’ve seen is that we have lots of pets and fish tanks, and renting isn’t feasible for us. It’s hard enough to find rentals with just kids…try telling a landlord that you also have multiple cats, two large dogs and three 100 gallon plus tanks and watch them run screaming.
Would I buy in this market if I was in a “normal” situation? No. Does selling now and renting make sense for my family personally, given our current situation and lifestyle? No. Ergo, we’re staying put.”

RESkeptic at VREAA 17 Sep 2012 7:49am

Sounds sensible, and we agree with the logic entirely.
Bearish opinions voiced here are not to be confused with a recommendation that each and every owner sell their home.
For people where a drop in the market value of their home of 50% is less inconvenient than the hassles of renting, owning continues to make sense.
– vreaa

76 responses to ““Would I buy in this market if I was in a “normal” situation? No. Does selling now and renting make sense for my family personally, given our current situation and lifestyle? No. Ergo, we’re staying put.”

  1. The virtues of owning, and the hassles of renting, will be perceived quite differently after prices drop 50%.

    • Agreed.
      There is only a small minority of Vancouver home ownership situations where high net-worth genuinely makes the 50% drop in home price less of a hassle than selling.

      • Cranston Snord

        If it’s someone who bought pre-2001 or so and intends to live in that house for another decade, it probably wouldn’t matter, as long as they practised good financial planning and didn’t base their retirement plans on the house’s on-paper worth.

        All the good reasons to own a home have little to do with finance and investment while nearly all the wrong reasons do.

        Some of the comments in this section are tilting towards the same irrationality and vitriol that the real estate bulls and BPOE cult show. Careful people.

    • Agree, El Ninja. I think vreaa’s considering the case of the recent buyer who has paid current prices, not necessarily those who bought with lower ACB.

      On a related note, Canada Watchdog has an interesting graph showing the correlation between consumer confidence and home sales in GV/GTA: https://twitter.com/CanadaWatchdog/status/251074649268568064/photo/1

  2. Renters Revenge

    “For people where a drop in the market value of their home of 50% is less inconvenient than the hassles of renting, owning continues to make sense.”
    Tee hee! Excellent use of biting sarcasm there vreaa! 😉

  3. Renters Revenge

    Hey RESkeptic…

  4. City hall is proposing “thinnner” streets – in West End. http://www.cbc.ca/news/canada/british-columbia/story/2012/09/26/bc-vancouver-affordable-housing-report.html

    Their solution to improve affordability:

    very wide streets can give up some land that is already owned by taxpayers for both green space and housing

    Which streets in West End are “very wide”? These idiots fully believe that Vancouver has ran out of land and the only solution to affordability is something like this: http://sometimes-interesting.com/2011/06/28/kowloon-walled-city/

    Was Vancouver’s city hall always filled with geniuses like this?

    • I listened to Jeff Meggs talk about this one on BC Almanac last week. I don’t think he thinks it will do much. The idea of experimentation is good, if only to show how futile our existence really is.

      The idea of land trusts is a big deal in my view, if council adopts it wholeheartedly.

  5. going from ownership to rentership makes sense only for the very greedy who hope to buy low, sell high. I only know of one person who (used to) do this. She’s been a renter since 2008 and I doubt she’ll ever own a SFH in the city again

    • “Rentership” — great new jargon from F1. It has a nice, smug ring to it, consistent with BPOE superiority. But let’s go with it. Oh wait, ownership is the same as rentership, except you’re renting money from the bank.

    • going from ownership to rentership makes sense only for the very greedy who hope to buy low, sell high.

      Those greedy bastards! Good people always buy high and only sell to buy even higher, right?
      In Vancouver, they do it like Ali G.

    • Royce McCutcheon

      @F1. Your point does not hold (at a minimum) for anyone who isn’t residing in the property they intend to inhabit for many decades – i.e. anyone on the so-called “property ladder” that hasn’t reached the long-term rung they want to be on. The “property ladder” concept needs steadily increasing prices to build equity that will allow levering up to a better/bigger place. If this is not happening and people need to address changed housing needs they may need to sell and rent. Say someone has a growing family, selling and renting may be the only way to get access to more bedrooms while still staying in the same neighborhood, keeping kids in the same school, preserving established access to day care, etc. YOU can believe that’s a poor personal financial choice, but calling greed seems pretty misplaced. And what I’m describing is increasingly not a rare situation by the way.

      Also, you can call a lot of things greedy. Maybe someone selling off and then renting is motivated by “greed” (i.e. a desire to make profit). How are they any more or less greedy than people who sought to make a profit as the market ran up? They’re not. But did you describe those other folks as being solely motivated by greed?

      • Ralph Cramdown

        Good greed = pays his real estate commissions, land transfer taxes and sundry closing costs like a good little boy — it keeps the economy going, doncha know?.
        Bad greed = expects his landlord to subsidize his lifestyle.

    • ” I only know of one person who (used to) do this”

      Sounds to me like said renter is speculating, in a way, if I can be so bold as to expand the use of the term.

    • I went from ownership to rentership last year and it’s true, I’ll likely never own a SFH in this city again. This whole rentership thing makes too much sense!

      • I’m rather fond of Rentership™ myself, RR… But I’ve always wondered… Ownership… Rentership™… is there anything even remotely comparable to the “GoodShip…”…

        [NoteToEd: Youth. Ontology. HollyWoodHistoriography. Seriously, when xiào no longer requires my presence/prescience on these shores… It will all reduce to an Airstream International CCD in the desert…]

      • At the risk of overstating the obvious, it’s all all about the waning frames of that clip and what it means to be human…. To be alive. To survive the ‘BubblePop’. Don’t worry. We will laugh. Most of us. Even the afflicted. And we’ll make something better…

        Well. That’s the plan. TeeHee!

      • “This whole rentership thing makes too much sense”!

        until it doesn’t

    • F1 – it is a very far fetched generalization that “going from ownership to rentership makes sense only for the very greedy who hope to buy low, sell high.”
      Lots of other situations when it makes very perfect financial and planning sense and it has nothing to do with the greed. For example in a situation with the declining property market, people owning small part of their home (having built no much equity, less than 20-30%) might want ot sell now as long as it is still feasible, so if the market drops more than that they would avoid the situation when they own more than 100% to their bank. When their next refinancing comes along with the new property assessment number, their mortgage conditions are going to be re-evaluated and with no or negative equity they are not going to get any good rate. This is only one example of the overstretched situation every responsible person has to try to avoid especially if there are kids and lots of other financial obligations besides the home. When people talk about the quality of life and how being a home owner contributes to a better QOL, they forget that being an overstretched homeowner may affect the QOL negatively when other sides of life are under-financed or sacrificed due to parents working tow jobs, no vacations taken, no money for the hockey or simply mom and dad stressed over the money matters all the time.

  6. If the poster is truly content with their circumstances, then why would he/she spend time following this website? Or is this a professional interest?

    • OP here. I follow this blog because I’ve lived in Vancouver all my life and think that the housing bubble has been both destructive and insane for the city. In the interest of full disclosure, I’m not a realtor (I hate the breed), nor do I make money off the housing market in any way shape or form. We don’t have a HELOC at all – I hate debt and think they are just asking for trouble.

      My post wasn’t intended to say that everyone should buy, nor that everyone should sell and rent. Just that there are different situations out there and for some people (although not the majority) renting is less hassle than owning when all factors are considered. For us, that will hold true even after a 50% drop in the price because we will not have a mortgage or debt.

      If I were in a more normal situation (needed a mortgage), I would absolutely not buy into this market.

  7. “If the poster is truly content with their circumstances, then why would he/she spend time following this website”?

    many ousted ex-Vancouverites follow our real estate blogs. Most were forced out due to unaffordability. This particular poster has his own personal interest in hoping for a GV real estate crash; he left a lot of money on the table by selling in 2007 rather than 2011. They all have an emotional connection in wishing for a crash…envy, jealousy, pride, etc.

    • Those outside the Vancouver RE ownership circle have certainly not cornered the market on the 7 deadly sins.
      For instance, how about this for ‘Greed’ -> Overextending to the utmost to buy Vancouver RE, at any point through this speculative mania, on the premise that the purchased home would continue to increase at a steady 7%-10% a year ad infinitum (and thus multiplying one’s 10% downpayment many times). Show of hands, please.

      • vreaa,

        not much more than fear and greed drives human behavior. Fear of being homeless might drive a lot of sales, fear or being priced out forever is also a big motivator. How about fear of not having a secure environment to raise your family? I’d say greed is pretty far down the list of what is motivating the buyer.

      • Having a “secure environment to raise your family” is a multifaceted concept. It’s not only about having a place to live. It’s also about having adequate discretionary funds to deal with unexpected challenges – downturns in the economy, employment changes, illness, relationship changes, etc. And it’s also arguably about having the confidence that comes with knowing you can weather such a storm.
        In Vancouver in recent years, many have equated “secure” futures with owning a home (as you have). Our concern is that many have overreached financially in order to obtain ownership, and in the process put their futures at risk from another perspective, namely the financial one.
        As you know, we now expect an end to the speculative mania and a very significant drawdown in prices (we respect the fact that you disagree with that prediction; we’ll see who turns out to be correct). As prices drop, we expect many who thought they were creating a “secure environment to raise their family” will find out that they have actually put their family’s security in jeopardy. They will run into financial challenges and be far worse off than if they hadn’t overreached to buy in the first place.
        This is not a pleasant state of affairs, but it is what happens when a community becomes gripped by a mania.

    • Royce McCutcheon

      @F1: People are people. You are completely capable of noting that envy, jealousy, pride, etc. will all be on equal display from home owners if/when the market turns, no? I mean, even if you don’t think the market will turn, you’re not going to honestly try to refute that idea are you? Or is choosing to rent somehow a character flaw, something that indicates a greater propensity for these traits?

      I’ve had a couple friends forced to sell due to personal circumstance lately. One broke even and the other realized only a small gain on their sales (both values calculated before factoring in closing costs though *sigh*). At multiple times, both of these people told me I was “lucky” to not be owning right now, wishing they’d not bought. I didn’t say much but did note to them that it wasn’t luck. That I have been choosing to rent. That provoked some good conversation. Anyways, I don’t see how you can’t characterize the sentiments they expressed as envious, etc.

      • F1 is not really trying to make a point. All he is doing is throwing around some ad hominems.

    • “he left a lot of money on the table by selling in 2007 rather than 2011”

      I did some math with a friend who exited in 2008. An opportune time, as it turns out, to have invested a small windfall in either stock or bond markets. The fellow is miles ahead having sold in 2008, mostly because the property he had has not appreciated in nominal terms.

      This does not apply for specific properties in a few specific neighbourhoods. But I can tell you that for some people who have been renting since 2008, they are better off, even without nominal price drops.

      Sorry to break the bad news.

  8. This anecdote suggests REskeptic did not HELOC, which is amazing in light of the temptation. I cannot cruise the web without finding numerous ads from Canadian Banks suggesting ways to slash HELOC rates. Personally, i’m surrounded by many people (Victoria) who did just that, at the ‘top’, summer/winter 2011, effectively selling the house back to themselves. This is the ‘hidden’ housing conundrum facing many Canadians, and to which we have the bankers and main stream media to thank.

  9. My folks are in the same boat. They bought in the mid 80’s for cheap (~$150K) and now their Burnaby house is probably worth $800K. They paid it off long ago and have a healthy amount saved for retirement which will probably be in 5 years (they are mid 50s).

    They like the house, have made many renovations and upgrades over the years to suit their needs and are very well rooted in the community. They never really considered their house anything more than a house so whatever the market has done or will do in the future doesn’t really matter to them as they never had any plans for the imagined gains anyway.

    They agree the market is overpriced and doomed to drop a large amount but they still have no interest to get out.

    • Indeed, there are many people in the same situation who are being glibly dismissed here. The smart buyer buys a home, not an investment.

      As to the joys rentership, many here seem to be too young to recall the uproar in the early ’90’s when older apartment building were being torn down to make way for condos, with the attendant media tales of granny turned out onto the street, When you own you home outright, it’s your decision when you move not the whim of a landlord who might renovict you. While the last five years have obviously not been a prudent time to buy, that doesn’t mean it is never a prudent time to buy.

      • Cranston Snord

        “The smart buyer buys a home, not an investment.”

        I like that phrase a lot.

      • Ralph Cramdown

        “The smart buyer buys a home, not an investment.”

        I completely disagree. All the way up the boom, agents will tell you it’s not just a home, it’s a great investment. At the apparent top, they’ll say you shouldn’t think of it as an investment, but a home. Well guess what: If it’s going to be the biggest purchase I make in my life, with an opportunity cost to match, it’s an investment. If I’m not thinking ahead to the eventual buyer when it comes time for me, my estate or my heirs to sell, I’m an idiot. If I buy the place with a roof that’s far more costly to maintain than normal, the place next to the train tracks or the place in a terrible school district, I’m an idiot, regardless of whether these issues bother me personally. If I jump in near a market top without regard to fundamentals because I just got married or my family just outgrew current digs, I’m an idiot.

        The smart buyer buys an investment that he’d be happy to call home.

  10. @Renters Revenge I don’t think (I hope) that @vreaa is being bitingly sarcastic when he says that there is a small minority of homeowners where a 50% drop in RE prices matters less than the hassles of renting. The key is that it really is a small minority and that most people who think that they are in that minority probably will change their mind once the drop happens.

    • Renters Revenge

      I may have misread the sarcasm levels…I apologize if I coloured veraa’s comments the wrong way.
      However, what really is the “hassle” of renting? I’ve rented and I’ve owned, and I can say that in many ways renting is much LESS hassle than owning. Especially when you factor in the current market conditions and the hassles of opportunity cost and capital risk. It is not rational in any way for anyone to hold on through a 50% correction, if that’s what you think is coming.

      • The major hassle of renting is the risk of being asked (no matter how kindly) to move. For some, it is worth almost any amount of money to avoid this possibility. This is part of what we consider the ‘ownership premium’ (how much more you’d pay to own rather than rent). For some people the premium is low (even negative), for others, high.

      • But is “ownership premium” normal? There are also risks associated with owning, and investors wouldn’t buy RE unless they could make a profit (the difference between rent and the cost of ownership).

      • For some, ownership increases utility, and that merits a (modestly) higher price than that calculated purely on the basis of rental costs.

      • Wiley commenter “freako” used to opine an owner’s premium is a renter’s discount. Therefore, an investor…(fill in the rest)

      • I wrote about the owner’s premium here http://housing-analysis.blogspot.ca/2009/01/ownership-premium.html
        Also check out the comments.

        My recommendation: if you understand one thing tonight, it would be that the “ownership premium” AKA “consumer surplus” cannot justify permanently high market prices.

      • Agree completely re your comment about ownership premium not justifying Vancouver’s prices.
        The ownership premium has nothing to do with the speculative component to prices (where homes have been priced as financial instruments rather than for their utility as accommodation).
        The concept of ‘ownership premium’ applies most clearly in completely normal market conditions. Some people will pay something more each month for use of a home that is theirs rather than it being rented (it may have more utility to them: they can make changes without asking permission; they cannot be asked to move; etc).
        In Vancouver today, in our opinion, more than 50% of the price of a home is the result of the prior speculative run-up. Any sane ‘ownership premium’ pales in comparison.

      • Very good points on this thread. I do think that another point to make about the “hassle” of renting and the decision whether or not to sell and wait in a rental while the market corrects is that your starting point matters. What I mean is that if you are already a homeowner, in addition to the “hassle” factor and other lifestyle decisions, you also need to factor in the significant transaction costs inherent in selling a home.

  11. The typical homeowners, like the OP, doesn’t account for the large amount of interest income he would have earned year after year if he cashed out. That alone would pay for 50-70% of rent. Also, he saves money from not having to pay property tax and strata fees (for multi-family). That’s really just another way of comparing renting a place from the landlord vs. renting money from the bank.

    But what do I know… RE in vancouver can only go up and the naked renters can never own a SFH anymore. We will continue to live in smaller and smaller boxes until we can’t fit into those boxes anymore.

    • Please, not interest. Eligible Canadian dividends, that’s how you earn and pay taxes like a boss (or like Mitt Romney).

  12. File this one under WhoKoodaNode!? or CautionaryTales that arrived too late to be of use to anyone other than EconomicHistorians…

    But first… Your Quote ‘O TheDay!

    “It’s like the way other people collect watches.” – Anne Stevenson-Yang, co-founder of the research firm J Capital group

    [WaPo] – As China’s economy slows, real estate bubble looms

    BEIJING — Sitting on the floor of his apartment surrounded by the toys of his 1-year-old son, Guo Hui tallied the homes he and his wife had acquired over the years.

    There was this place, located in a compound a half hour from downtown Beijing. There was a second apartment to the north, a third place near the site of the 2008 Olympics — and a fourth home close to the Forbidden City that was given to him by his parents.

    Guo gestured to the wall behind his couch. His neighbor? He owns six apartments in this compound alone. Guo’s friends, too, all own at least two homes each.

    “There is definitely a bubble,” said Guo, whose homes have tripled in value in roughly a decade.

    As home prices have skyrocketed, many Chinese households have gone all in on real estate by pouring years of savings into buying as many homes as they can.”…

    http://tinyurl.com/9z82cjy

    • If you have a better idea what to do with capital in China I’d like to hear it! 🙂

      • Fair enough, however this makes sense only if they used their own money or at least very cheap money (or stolen). Maybe it’s the case in the article mentioned by Nem. But for many (most?) in China, borrowing has not been that cheap and speculators need rapid appreciation of real estate to make money.This has worked fine for a decade, but it will eventually blow up spectacularly.

      • Dr. J, I vote for further easing by the PBOC and increased NationalExpenditure ResponsiblePersonalInvestment in ChinaAllGirlMilitia PrecisionMarching&DrillTeams… [NoteToEd: I’m quite certain this is an ExportBoostingNoBrainer. NoteToSelf: I surrender. Please.]

      • Not exactly the most appropriate fatigues in a century more known for its officially-sanctioned mufti (unless they only attack at sunset or are embedded on Cathay Pacific flights.)

        Hate to get all “macro”, Nemesis, but further easing is exactly what is unlikely to happen in the medium term. China needs higher, not lower, real rates to rebalance. It’s seemingly bass-ackwards, but for some reason The People feel richer when their savings accounts have high interest rates.

    • And here’s the Globe’s ‘take’… [YVR Schadenfreude is best expressed by Torontonians]…

      “That hiss you hear may be the sound of Vancouver’s housing market.” – Michael Babad

      [G&M] – Vancouver Homes Sales Plunge More than 30%

      …”Residential property sales in the city plunged 32.5 per cent in September from a year earlier, to 1,516 transactions, the Real Estate Board of Greater Vancouver said today. Sales were down more than 8 per cent from August, the group said, and almost 42 per cent below the 10-year average of 2,597 for the month of September. Vancouver has been a major concern among economists. New listings fell 6.3 per cent from a year earlier, while the number of listings stood about 14 per cent above year-earlier levels.”…

      http://tinyurl.com/9a7j3to

      • My concern is “dramatic” headlines and changes like these might lead the Federal government to reconsider its recent rule changes (as it appears they are taking the fall). I expect the pressure to do so will be substantial.

      • “I expect the pressure to do so will be substantial”

        Vancouver’s performance, however poor, will be unlikely to significantly affect federal policy. If the federal government steps in to “bail out” Vancouver the rest of the country will be asking some tough questions about whether Vancouver is deserving of such a bailout at a time of supposed national austerity.

        As of now most of the country save Vancouver is putting along quite nicely. I would expect continued and increased lending crimps through next summer at least.

      • I think it would be very difficult to specifically target Vancouver alone in any “bailout” scenario. Besides, that’s a job for CMHC. I was more referring to an easing of the recently changed mortgage rules.

      • And the “benchmark” has dropped too. You know that when the made-up-so-that-it-hides-reality measuring stick goes negative, that the real mean/median/mode/whatever is going to be a doozy of a negative number. Particularly on an annualized basis.

        People are going to be in deep water… if they aren’t already.

    • I think the point is YVR housing doesn’t score very high on the list of priorities when the feds are setting fiscal policy. Therefore, even if prices crater in Vancouver it is unlikely that the government would do anything differently.

      I don’t see them loosening CMHC rules anytime soon…I think they want the worst of the housing crash to be over before the next election. Sucks to be a speccer in Vancouver. Or a UHS. Or a mortgage broker. My heart bleeds.

      • My guess is that they saw this crash coming (anyone living in Realityland did) and decided to give the sled a nudge down the hill with their revised CMHC rules.

        I would actually bet that they might be heartened by this development and might take the opportunity to tighten things further in order to speed along the inevitable. The shrewd political calculation will be “now that things are bad for unwise homeowners, making them worse won’t make things any worse for us.”

        Stick a fork in it, it’s cooked.

  13. Just found this:

    http://www.cbc.ca/news/business/story/2012/10/02/vancouver-housing-plunge.html

    …which is no surprise. But some of the comments (and sub-comments) are interesting. E.g., from Sethik44 at 1:46 pm ET:

    “Well how about the responsible ones that (sic) bought homes at the higher market price, that will now lose money as the market settles?.. .I bought a house for $700,000.00 that now will only be able to sell at $600,000.00.

    The new rules simply screw over anyone who bought before they were implemented.”

    • Agreed. This person has every right to be bitter. Government intervention has driven the market up and down, and as a result it is impossible to separate prices paid from political policy.

      • I disagree. They have no real right to be bitter. They have had full information. In fact, much more information than anyone in the history of the world.

        And no one said that to live in the lower mainland. It’s a big country. There are lots of opportunities in much more sane markets.

        And if, for some odd reason, they were totally locked into living in the land of perpetual rain, they did not need to buy. There are other options available.

        No, I don’t feel sorry for them. Although I feel even less sorry for the small- and large-scale speculators. Unfortunately most of the latter will end up off scott free, because that’s how this world works. The real pain will be carried by the person in that post and others like them.

    • “Well how about the responsible ones that (sic) bought homes at the higher market price”
      Fixed.
      Perhaps the lesson is that your government doesn’t always have your best interests in mind.

      • Agree with that. The government wanted to avoid (or at least to postpone) the recession in Canada and they succeeded in transferring of the cost of the stimulus to the “responsible ones that (sic) bought homes at the higher market price”.

  14. Check out the front page of Huffingtonpost.ca right now:

    “What goes up…

    (massive font) MUST COME DOWN”

    (picture of downtown Vancouver)

    “Vancouver Home Sales PLUNGE…”

    We’re in full blown panic mode now. I bet in a month or two everyone and their dog will be saying about how they saw this coming a long time ago and it was common knowledge Vancouver was overvaluded and and and…

  15. The OP is simply pointing out that owning in Vancouver makes sense for them. If they are near to paying off the mortgage then it is likely that the home was purchased some time ago and the decision to buy was made with the best information available at the time. Perhaps it was purchased when the price to rent numbers were much more in favor of buying. By going about their lives, paying on the mortgage they have (through no fault or plan of their own) found themselves with an asset that has increased in value beyond the fundamentals.

    There is then the opportunity to realize some of these gains with the hope to repurchase the asset when its value is closer to the fundamentals. There is a significant cost to moving and significant uncertainty on predicting the top and predicting the bottom. Although one may eventually be able to look back on this and see that the market declined 50% it will likely require selling in a very specific month and buying back when you have confidence that the market has indeed bottomed. Missing both dates by a relatively small amount may make the actual realized gain on the cycle of selling, renting and buying much less.

    I think this is a great time to cash out of the Vancouver market and take your cash to another “cheaper” market and rent for a bit. Then you can see if you really like it and choose if and when to become a homeowner again. There are many livable places in Canada and the world where the realized gain from a property in Vancouver buys you a house outright.

    Unfortunately for me I am going the opposite direction. I sold my house in Calgary this spring and I am renting in the Vancouver area. If prices don’t fall significantly I won’t buy.

    • UBCghettodweller

      “There are many livable places in Canada and the world ”

      Not from the perspective of many of the Vancouverites I’ve talked to. Most can’t conceptualize living anywhere else. Every other city in Canada is too cold, too cultureless, a shithole suburban wasteland, or too french. Never, ever, in any other Canadian city I’ve lived in (including Montreal) have I found such elitism, exceptionalism and arrogance. Let them rot in the financially ruining dump that is Vancouver. At least they’ll have the ocean, mountains and yogapants-bum… Then again, most of my contact is with 20-somethings who bizarrely haven’t travelled much or lived anywhere outside of the Lower Mainland. This is the only city where I’ve seen no young people feel no need to see the world. I blame the mind altering spores that grow in the soil around here.

      • “Never, ever, in any other Canadian city I’ve lived in (including Montreal) have I found such elitism, exceptionalism and arrogance.”

        It’s thoroughly befuddling. It mainly affects those who were born there, but some others also catch the disease. And, when examined, the claims all falter.

      • You are so right. I grew up in Van but have lived in Chicago, San Fran, NYC, an Edmonton, all fine places to live. Vancouver probably ranks just above Edmonton. The people here are exactly as you describe.

  16. Humorous article. As if he has a choice at this point in time. Buy? How? You need to sell first, and that will be a problem, unless you’re willing to take a 30% haircut.

    Funny, sounds alot like a defense mechanism justifying its huge losses, as if something could be done about it.

  17. CTV news reported on the stats and in the story they mentioned that sellers are not willing to budge much….this is going to get interesting!

  18. If you miss the top and have to sell at a discount, then this has to be factored into the decision to sell. People with significant equity can look at what is going on with some amount of indifference because they have ridden the wave higher and as property values come down they should only go to level that a sensible pre-bubble buyer could have expected. The unrealized potential gain is most easily achieved when moving from the bubble to a less bubbly place. Waiting out the bubble has taken a long time in Vancouver.

  19. I don’t get this. In today’s report:
    http://www.theprovince.com/touch/business/story.html?id=7332688

    The president of the Real Estate Board said the following:
    “Buyers think that they’ll get a better deal tomorrow so there’s no urgency to buy, and sellers aren’t moving on prices in any significant amount.”

    So that assumes the present drop in sales action is entirely a psychological battle. However he then says:

    “There’s been a clear reduction in buyer demand in the three months since the federal government eliminated the availability of a 30-year amortization on government insured mortgages,” said Klein in a statement. “This makes homes less affordable for the people of the region.”

    Which implies there is an actual economic reason that buying is not going on. i.e. people cannot afford homes at the present price point. It’s not psychological. It’s bloody real. People cannot buy at this price point because they “can’t afford it”. Not because they “think” prices are going down.

    As such prices WILL go down. The only paychological resistance to that is from the sellers who believe they don’t have to drop their prices to a new and real economic reality.

    2 cents.

    • UBCghettodweller

      Wow. Doublespeak.

      I really need to leave basic science where you can’t just bullshit around. Either you say “A” is supported by the data and how you think the system works, or you say “B” is supported by the data and how you think the system works. You can’t waffle about…. Well actually you can, and then you don’t publish papers and you’re out of job.

      Evidently the business world has stopped being the meritocracy the capitalists said it once was. Not that the nepotism in academic science is much better.

  20. Fuck, I have “Waterfront Cities of the World” about Vancouver running in the background and one half of that is about real estate. WTF is wrong with this city?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s