RE In The Minds Of Vancouver Authors – “People everywhere are taking out second mortgages on their homes in the hopes of accomplishing what Mother Nature has not, and here, biology at work! How extraordinary!”

In the CBC ‘Canada Writes’ 2011-2012 Creative Non-Fiction competition, the winning entry came from Toronto; two the three runners up from were from Vancouver. The entries are only 1200 – 1500 words in length. Both Vancouver authors referenced RE in their stories: One deals in part with a construction site injury; the other mentions people taking HELOCs to pay for fertility therapies.
Co-incidence? We think not! In RE speculative manias, the subject of RE is mentioned in popular culture more often than in typical times. – vreaa

“The call comes on a Monday morning. Your son’s boss. An accident, he says. He fell.” …
“The job site is closed down. Notices taped to a rented fence. You peer through the wire, your husband silent beside you. The roof soars above you, shiny, corrugated, supported by massive dark red beams. You squint, hoping to make out the corrugation that caught his boot, but it’s late in the day, the light dim.
You stare up and up. The roof so high.
Neither of you speak.
The skylight opening, cut that day, covered with flimsy sheets of plywood, the kind that flex and bow when pressed hard by something solid like a young man’s body. You stare up at it, the square of light too bright for you.
Forty feet. A concrete floor.
The wind shifts and hits your face. Your husband takes your hand and together you walk back to the car.”

– excerpts from ‘After, and Before’, Judy McFarlane, Vancouver.

“People everywhere are taking out second mortgages on their homes in the hopes of accomplishing what Mother Nature has not, and here, biology at work! How extraordinary!”
– excerpt from

35 responses to “RE In The Minds Of Vancouver Authors – “People everywhere are taking out second mortgages on their homes in the hopes of accomplishing what Mother Nature has not, and here, biology at work! How extraordinary!”

  1. None, still, more varied and deep than the Vancouver real estate blogosphere.

  2. Meanwhile… back in the realm of NonFiction…

    [G&M] – Why house prices aren’t coming back

    …”Numbers don’t lie – especially about Canada’s overheated housing sector. Increases in home prices in recent years have not been matched by underlying increases in fundamentals. The market is due for a severe correction.

    One particularly telling statistic is housing investment as a share of GDP. This ratio has steadily climbed toward a record high over the past two years. It is now more than 7 per cent of GDP versus a 50-year average of 5.8 per cent and previous peaks of about 7.26 per cent in the late 1970s and 7.18 per cent in the late 1980s. After residential housing investment as a percentage of GDP peaked in the previous two cycles, the housing market crashed within a few years.”

    http://tinyurl.com/arysfcm

    • [G&M] – Canada’s Housing Hangover: RE Boom Meet Dot.Com Crash

      …”Housing market, meet the stock market.

      You two have a lot in common, though plenty of people believe you’re worlds apart. They think the housing market is a very smart place to invest, while stocks are treacherous. They’re half right. Stocks do have a nasty side, but so does residential real estate.

      We may be seeing it emerge in the latest resale housing numbers. Sales across Canada fell 12 per cent on a year-over-year basis in November, and prices dipped almost 1 per cent. Vancouver sales were down 29 per cent, and prices fell 1.7 per cent; Toronto sales fell 16 per cent, while prices moved 1.6 per cent higher.”….

      http://tinyurl.com/b3gwyqq

    • Thanks. Compare G&M articles with what V.Sun is printing. Remarkable.

    • Good article. I like how the guy states, to paraphrase:

      there is a correlation between house prices and demographic shifts, and there is a correlation between demographic shifts and lowering interest rates

      I’ll use my crayon to draw in the third line and make it a triangle. I like triangles.

    • Glad you brought that article to our attention, Nem. George is certainly one of the more bearish economists around. You might recall he produced a chart of Canadian housing prices as a percentage of GDP that was featured on this site back in February 17 2012.

      https://vreaa.wordpress.com/2012/02/17/youve-got-a-bubble-canada-article-47-bloomberg-canada-housing-poised-for-severe-drop/

      The chart is surely one of the most damning visuals available on where we now stand in this country and it is quite clear where we are headed next. See the following link for yourself for a refresher.

  3. Hah even the story’s comments reference RE:

    Rafina
    2012/07/15
    at 8:15 AM ET
    I love this short story!
    It’s light and quick. It keeps you wanting to read more. this writer does not linger forever on details we only need if we are selling a house. Do you know what I mean. Bravo!

  4. tunnel vision

  5. Cyril Tourneur

    “Horkheimer and Adorno (1976) argued that the very idea of culture has developed into a viable industry, which develops in congruence with economic trends. Specifically, they observe that mass production of goods is a means of needs satisfaction which consequently allows centralized powers control and manipulation of the individual. The multiplicity of preferences available to consumers cultivates a belief that each and every need can be satisfied by a specific product, creating a reliance of the consumer on the producer to recognize and tend to personal needs through their product. This places the producer, or rather the corporation, in a position of influence over the consumer. Mass production of products translates into mass production of ideas, making culture merely an industry which promotes the ideologies of those in command of it. Horkheimer and Adorner (1976) describe this branding of ideas through consumerism as the culture industry. The process by which this occurs is characterized by several factors, all of which reveal that the individual is not enabled, but rather striped of power, while the ruling few become more empowered.”
    http://www.colorado.edu/communication/meta-discourses/Papers/App_Papers/Barr-culture.htm

    • Roger: You can’t sell a product without first making people feel bad.

      Nick: Why not?

      Roger: Because it’s a substitution game. You have to remind them that they’re missing something from their lives. Everyone’s missing something, right?

      Nick: I guess.

      Roger: Trust me. And when they’re feeling sufficiently incomplete, you convince them your product is the only thing that can fill the void. So instead of taking steps to deal with their lives, instead of working to root out the real reason for their misery, they go out and buy a stupid looking pair of cargo pants.

      http://www.imdb.com/title/tt0299117/quotes?qt=qt0193234

    • Real Estate Tsunami

      I always wondered why I should pay for wearing a Nike tea shirt.
      I am a walking advertisement board, so they should pay me.

  6. What do you think, VREAA? Are we witnessing the beginning of something that will turn out to be far bigger/more significant/longer lasting than a regular cyclical downturn in real estate? This quote in the G&M is stunning:

    “But while cyclical ups and downs in the housing market are to be expected, my forecast is not simply for a cyclical downturn. Rather, I see a long-term fall in home prices that will not be reversed when the economy picks up.

    The key factor is demographics.”

    http://www.theglobeandmail.com/globe-investor/why-housing-prices-arent-coming-back/article6929120/

    • The guy has made a damn good case for selling and renting for the next decade if you ask me. The big question on any sane persons mind would naturally be….”but where do I put all that money in the meantime”?

    • It is possible that we see a bear market in RE that is more severe than almost anybody has anticipated, with prices eventually grinding down to real prices that represent 80%-off the peak. Imagine how devastating that would be for our city. It would represent a return to very long term inflation-only growth trend lines. We don’t weigh the probability of that outcome as very high, about the same probability as a trough at less than 30%-off!!
      Far more likely we bottom in the 50%-66%-off range.

      • Great contrast here today. George would be at the polar opposite ends of what our local Vancouver “experts” are saying. Just goes to show that economics is more art than science at times and we probably have to discount both exteme views to some extent.

    • IllustriousEd, et al… I just couldn’t resist this… but, apparently… things are rapidly spinning out of control in LuLuLemon LotusLand…

      [G&M] – LuluLemon Shares Droop On DownGrade

      …”Shares in Lululemon Inc. are down more than 5 per cent this morning after Credit Suisse downgraded the stock on worries about sluggish comparable-store sales growth and pressure on margins amid discounting of products sold online. Credit Suisse lowered its rating to “neutral” from “outperform” and cut its price target to $80 (U.S.) from $86.”…

      http://tinyurl.com/bgj9c5b

      • Hmmm…. I wonder, were the CrediSuisse analysts a tad concerned about the Chairman’s LoveAffair with YVR RE…. ???

        [skitsilano . ca] – Lululemon Founder Chip Wilson stays close to his retail roots with $37 Million home in Kitsilano

        …”If you head west from Lululemon’s offices along Cornwall Avenue you’ll eventually find yourself on Point Grey Road. Continue along until your find 3085 Point Grey Road (pictured under construction) and you’ll be in front of the most expensive home in Vancouver. According to BC Assessment rolls, the mansion was assessed at $37.2 million and is registered to a numbered company with Chip Wilson listed as the sole director.”….

        http://tinyurl.com/aavd2wh

      • Yikes! I almost forgot… A BC Assessment “LuLuOoops” moment… from last year’s CAD37.2M to…

        …”3085 POINT GREY RD VANCOUVER V6K 1A7 $35,168,000 Non-Manualized Structures 09-200-002630058090000 Building Unfinished”…

        Hmmmm… Where is Dr. J when you really need him? All right, then… Let’s see… you just push the number button thingies and then the “=” button… Right?

        Ah, there it is… that would be 5.46% decline. Never mind, a paltry CAD2M here or there is hardly the sort of thing likely to exercise a man brandishing StretchyPants…

      • No need for apologizing about not resisting the urge to post the LuluLemon stock weakness, Nem…
        Interesting, and by no means irrelevant. Thanks.

  7. Hey gang, check this out:

  8. Back to this post subject – a story telling about a construction site accident when the boy fell. I feel that there is a deeper connection than the casual mind boggling side of the RE bubble – the construction site accidents are probably well on the rise now caused by the unqualified younger people attracted there, unable to find any decent paying jobs elsewhere or swayed from the post-secondary studies and a proper life planning by the quick bucks avail. there and supervised by the amateur developers without the proper trade and safety education and with the very temporary attitude toward their occupation. The story pretty much sounds as a guilty verdict to this damn RE boom for what it has done to a younger generation.

  9. The burning question for me is if listings in the Lower Mainland top 30,000 this year. Could they even go higher to say… 35,000? And if you believe they will, when will it occur?

    In 2011 listings crested over 25,000 on around Sept 22. In 2012 total listings went over 28,000 on around July 1.

    My guess is yes, listings will absolutely exceed 30,000 total on any given day in 2013 and it could happen as soon as May 15. Also looking at the charts from 2011 and 12 those peak numbers were only sustained for a few days at the the most. Will this years chart of peak listings look as flat as the overall market predictions cameron and tsur are betting on?

    As the US economic data keeps streaming in watch the bond market continue to react and the popular myth of “the government will never let interest rates go up to screw me out of my house” go right out the window. A quarter or two of bond rate adjustments and the MSM will have everyone either rushing to re-fi and for those who wont qualify listing at any price.

    the velocity of fecal storms in the next 6-9 months in the major Canadian real estate markets will make Sandy look like a summer squall.

    • Real Estate Tsunami

      Hi Bob,
      I’ve already been on record on this blog a few weeks ago.
      28,000 listings by May 31!
      We will take no prisoners!

    • I don’t know how many listings we will see, Bob, but I do know the number of foreclosures will be on the rise, perhaps sharply. That is a very normal part of any market that is highly leveraged but showing signs of softening with declining sales levels.

      In essence, during a rising or bubbly market, almost anyone who is running into trouble making payments is able to get out with little damage. A strong market clears them. When the numbers of sales drop though that same group of troubled homeowners cannot find a bid and instead their property ends up languishing until no options remain and the foreclosure process deals with them.

      It is very predictable actually. At any given time there is always a percentage of homeowners on the edge. A weak market exposes these problems very quickly.

      A second outcome is that the numbers of bankruptcies also jump in tandem. We will be reading about both rising bankruptcies and foreclosures by summer. These kinds of headline stories are incidentally sentiment killers in a falling market and tend to further reduce sales as the bloom is already coming off the rose.

      Our friends Tsur and Mr Muir are completely unaware of this phenomenon as they were not around as adults last time it happened. They cannot model the impacts of sentiment in a decline and so have no idea of how potent “mood” is to real estate. There is no question though that the sentiment that drove up prices in the first place is an emotion that will vanish as the stories of lost homes become the front page stories during the coming year.

      Would any of you jump to buy a house if those figures doubled or trebled?

      • What I recall very clearly during the early Eighties when we last witnessed a very significant jump in foreclosures and bankruptcies was that there was a swift reaction from buyers to begin underbidding the market.

        The event brought out the vulture in even noble people and selling just got tougher for everyone. I exoect a rapid drop in prices as this unfolds. There is little to no possibility of a soft landing for Vancouver therefore as the level of leverage is high coming off a period of exceptionally overpriced housing.

        The only event that can prevent a negative outcome now is strong spring sales and that seems pretty unlikely to me.

  10. It’s funny how we can read an article in the G&M telling us that prices aren’t going anywhere but down based on solid facts, then we have the Victoria paper giving out editorials stating it’s time to load up now with zero facts other than “it’s a nice place to live” via an agent’s opinion. I love this quote at the end:

    “This short-term blip in house prices is likely just a footnote for most capital region homeowners, who are in for the long haul. For others, who are eager for a chance to own a home in Victoria, it could be an indication that this is the time to get into the market.”

    What trash journalism, as it tries to give logic to the US market crash and that high prices in Victoria are out of reach for most, then weaves back to “Victoria is more stable”. But then again this is the same rag that defends Christy Clark’s classless bimbo MILF ways so we should not be surprised.

    http://www.timescolonist.com/opinion/editorials/editorial-ups-and-downs-in-real-estate-1.39426

    • Nelson Chaney: All I know is that this violates every canon of respectable broadcasting.
      Frank Hackett: We’re not a respectable network. We’re a whorehouse network, and we have to take whatever we can get.
      Nelson Chaney: Well, I don’t want any part of it. I don’t fancy myself the president of a whorehouse.
      Frank Hackett: That’s very commendable of you, Nelson. Now sit down. Your indignation is duly noted; you can always resign tomorrow.

    • Diana Christensen: I watched your 6 o’clock news today; it’s straight tabloid. You had a minute and a half of that lady riding a bike naked in Central Park; on the other hand, you had less than a minute of hard national and international news. It was all sex, scandal, brutal crime, sports, children with incurable diseases, and lost puppies. So, I don’t think I’ll listen to any protestations of high standards of journalism when you’re right down on the streets soliciting audiences like the rest of us. Look, all I’m saying is if you’re going to hustle, at least do it right.

      • One of the top stories on CTV 6 o’ clock news last night was about a lost puppy. It was the second time they reported about this particular dog after reporting he/she was missing the night before. Last night they were updating us that a second dog was brought in to try to sniff out the location of the lost dog. This was one of the top three stories headlined at the opening of the broadcast at 6pm. You can’t make this up!

  11. Howard Beale: You’re beginning to believe the illusions we’re spinning here, you’re beginning to believe that the tube is reality and your own lives are unreal. You do. Why, whatever the tube tells you: you dress like the tube, you eat like the tube, you raise your children like the tube, you even think like the tube. This is mass madness, you maniacs. In God’s name, you people are the real thing, WE are the illusion.

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