“Usually I see 5 or 6 three bdrm rental units for rent in Vancouver or Burnaby at $1600 p.m. or less. But recently that figure has gone up to around 35 to 40.”

“I’ve been looking at 3 bdrm rental units the past year. Usually I see 5 or 6 units for rent in Vancouver or Burnaby area @ price 1600 or less. But recently that figure has gone up to around 35 to 40.
You can get decent place for 1350 to 1550 per month with around 1100 sqft.”

house burden at greaterfool.ca 17 Nov 2012 3:49am

Counterintuitive to some, the rental market will also weaken as RE prices soften and drop.
– vreaa

15 responses to ““Usually I see 5 or 6 three bdrm rental units for rent in Vancouver or Burnaby at $1600 p.m. or less. But recently that figure has gone up to around 35 to 40.”

  1. Odd. According to some realtors, $1600 is what you can easily get for your investment studio or basement suite.

  2. That is exactly what happens.

    Landlords always say “NO NO NO” rents go up due to renter demand, but that statement in and of itself is illogical when real estate prices are dropping, because carrying costs and acquisition costs drop as well, so tellme why again would rents go up ???……..the number of accidental landlords simply begging for ANYONE to help them cover their losses makes for a very grindy market, when the nervous nellies that never thought they’d be landlords start to flood the market with lowball listings, the professional landlords are at their mercy. I was a banker in the early 80’s here in Calgary and lived as well as worked thru the last major RE colllapse, and that is exactly what happened.

    Landlords are just as sleezy as realtors.

  3. Real Estate Tsunami

    In a perfect market, the cost of rental should always equal the cost of owning. That’s why “The Economist” compares the two to determine if property prices are over/under evaluated.
    My friend rents a house in Richmond for $1,500. Assessment value is 1,2 mil (Large yard, which he agreed to keep in shape).
    This house is way overvalued.

    • What?! There’s still a large yard left in Richmond? Somebody better do something about that and build another 3-4 car garage palace with a paved front “yard” and a generous 3m deep back yard, pronto!

      • Real Estate Tsunami

        It’s has an irregular shape. not good FENG SHUI.
        Another reason why the rent is so reasonable.

  4. A lot of secondary suites can stay empty until they are needed for income. With restrictions on Home Equity credit lines, you’ll see more rental supply.
    Without a rapidly growing population, and no growth in incomes, you aren’t going to see significant rent increases for a long time.

    • Real Estate Tsunami

      Agree. Also, just drive into Richmond and see the massive Condo Developments that will come on the market soon.

    • We’ll have to see about the pop growth trend. Definitely more new supply coming online in 2013.

      The only bullish thing I see is a potential for a renewed bout of foreign investment. We’ll have to see how that stands up against recent credit curbs.

      (BTW as nemesis highlighted recently the plight of those looking to land in Canada without demonstrable skills is looking emaciated. Looks like someone was reading all those vitriolic HAM comments last year and took some actual steps in response. You’ll be unlikely to get an official confirmation though.

      What has happened:
      Hold on investor immigrant applications
      Requirement to declare income for mortgage qualification
      Kenney complaining about provincial nominee program loopholes
      BC suspending “suspicious” provincial nomination applications
      Quebec getting severe pressure to curtail its nominee loopholes
      No HST rebate for houses 1mm+
      Removal of MI for 1mm+ homes

      Just saying, that’s not doing nothing.

      • Real Estate Tsunami

        Sellers who have withdrawn their listings are retrenching over the winter hoping that in spring the Asian buyers will be back.
        I believe that the next 3 to 6 months will be on of the most crucial periods in Vancouver’s RE annals.
        If the Asian buyers continue to stay away, than we could see a substantial oversupply of inventory and a significant reduction on prices.

      • “If the Asian buyers continue to stay away, than we could see a substantial oversupply of inventory and a significant reduction on prices”

        Even if they return it’s no sure thing that amount of investment can buoy Vancouver’s market overall. Curtailments in credit growth are almost surely of greater impact than direct “HAM” investment has been. Here are my quick back-of-the-envelope calcs based on some made-up but plausible numbers:

        – 4000 households directly invest “HAM” into Vancouver RE per year
        – Their average buy price is $2MM in cash (no mortgage)
        – That’s $8BB in direct investment
        – Vancouver’s growth in mortgage credit last year was 5%. That’s about $8BB increase in credit YOY.

        If credit growth stalls or drops, FDI needs to at least double to make up the shortfall. If any of those assumptions about cash purchases are to optimistic, it’s worse. We don’t have much data on FDI but I’ll take the under on my wild-ass guess.

  5. http://www.thedailybeast.com/articles/2012/11/12/vancouver-real-estate-market-unlikely-victim-of-china-slowdown.html

    Last paragraph is worth a million bucks unlike Vancouver RE. Just can’t get the image out of my head, LOL. Hope this happens soon!

  6. pricedoutfornow

    I too have been looking (casually) for a 3 bedroom rental in Vancouver. Can’t believe 1) how much supply there is 2) how long these rentals keep being advertised on craigslist month after month without being rented, often at lower and lower prices and 3) how many of these landlords, when I get the address, were wanna-be sellers in the summer, didn’t sell and now have to resort to renting out the property.

  7. Tell me about a glut in rentals. I moved back to Vancouver a few months ago because I got an awesome career opportunity (not pay wise, but responsibility wise). So, I went back into the rental hunt. Damn, I had no idea Craigslist would be flooded by all these new condos.
    I went to see a few of them because the prices were so reasonable and not that far off from the rates for traditional apartments – yet you would get modern appliances and amenities like gym, pool, sauna. The only issue I had was amateur landlords. Most of them were very keen on having me as a tenant. They would follow up after my visit. I could read the desperation in these landlords. A lot of them were gen-x.

    Luckily, the professional property management companies have realized there is now competition and you can not compete against BOSA built with plain Jane stale apartment buildings. I have noticed some luxury rental buildings on the market. I recently moved into a completely overhauled rental building with stainless steel appliances and granite counter tops. For the same price as those flipper condos. Of course the professional landlord has a higher margin because they bought a whole building (economies of scale).

    When SHTF rentals do fall. A perfect example is Phoenix. After the crash a lot of Canadians went there to pick up some investment condos for pennies on the dollar. The Canadians are able to rent out condos and houses for low prices and the Phoenix natives hate that they can not compete with the Canucks since they bought their places during the peak. The only option they have is to sell at a loss/ rent out for cheap/or leave it vacant. Each time I see all these new condo developments going up I always laugh to myself and think “wow, more rental stock”.

    • Naked Official #9000

      i drive past the OV / false creek area on 6th ave every day for work and back – i think the same thing – fucking HILARIOUS – the buildings are dark, looks like that 100 storey hotel in Pyongyang.

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