A Splendid Festive Season and a Happy 2016 to All

art young 1920 capitalism gluttony crop

Enjoy, but don’t be this guy. -ed.
[cartoon by Art Young, 1920]

59 responses to “A Splendid Festive Season and a Happy 2016 to All

  1. rod_jonsson_pmd

    pffft! … http://tinyurl.com/jxx2lah … omg can’t believe disney owns the force

  2. Village Whisperer

    Merry Christmas and all the best in 2016.

  3. The housing market policy Grinch may not want y’all to have a happy Christmas, but I guess we all know Christmas means a lot more than just that.

    Which reminds me. How does Santa get into condo units exactly…?

      • rod_jonsson_pmd

        pffft! … allow myself to apologize for myself in advance … http://tinyurl.com/zljxkl2

      • Antisocial behaviour is rampant spurred by a wanton disregard of rule of law, but it will go away once the country embraces democracy following the footsteps of Iraq and Afghanistan. What an expensive learning curve for the monolingual strata!!! Where are the human rights lawyers?

      • I agree. But I think China is a long ways away from reaching democracy. First you have to ask if the Chinese even want that. In a country of 1.3 billion people, it is not a given that the populace even knows what is best for it. But then again, dictatorship in China means that the speed of development could accelerate without how shall we put it, worrying too much about the rights of individuals. So both sides has its advantages. I believe it was JFK who once wrote in one of his books about the unpreparedness of the British to deal with the Germans. Part of the issue is the culture of dictatorship vs democracy.

        Now onto more relevant points. Technically there is no human right violation as long as he is allowed to get an interpreter. People have to understand that the majority of owners in the complex speak mandarin better than english so they will vote with what they feel is best. Frankly I think this is just disrespectful but like any private enterprise, the majority will rule. Just like the Chinese signs in Richmond, I can’t wait until this news reaches china, that would be hilarious.

      • So, Brian. You have implied that the Chinese are financially illiterate. You have also said that they are incapable / uninterested in learning a second language. Now it turns out that they can’t decide for themselves on matters of government, and would find amusement in the disrespect shown by this strata. Lovely characterizations.

      • The concern is being able to understand the decisions, and being able to represent one’s interests, in a strata. Meetings being conducted in a language not expected to be understood by the general population may be a proble!. This story is easy fodder for getting upset, though, which is why I am somewhat skeptical.

      • I sympathize with the guy, but he lost some credibility when he said he was seeking financial retribution for emotional distress.

      • This just in, Santa Clause is Chinese:

  4. Happy Holidays, vreaa.

  5. P.S. Great illustration. Very apropos.

  6. … but it is just a waffferrrr? Surely sir…

    All the best.

  7. Vancouver is the LEAST Christmas looking place in North America.
    no Christmas cheer in that hole

    you get a more Christmas atmosphere in Miami

    • Then please go to Miami then! Geez…why are you still here if you hate Vancouver so much? I can understand some bitching and complain, heck I do it myself sometimes, but you take it to a whole whole whole new towering level. Why are you still here?

    • Coming from a guy who can’t stand anyone who has a different view from him on RE and why it is so expensive.

      And why is my question not a fair question to ask someone who apparently hates Vancouver so much and yet unwilling to move elsewhere?

      • Oh, I can stand different views. Just not infantile, narrow-sighted ones, like that put forth incessantly by you and your sidekick. “China” is not an investment thesis. “Limited supply” isn’t either.

      • So basically what you said is: I tolerate other views, just not yours cuz I don’t agree with it.

    • Stay close to home at this time of the year.

    • You do however get a nice chinese new year celebration whenever that is. Merry Christmas to all and Gong Hei Fat Choy for Chinese New Year, if only I remember when that is. But that’s ok, I am sure anywhere I go in Rihcmond will remind me.

  8. Many many years ago I spent December in Cairo and December 25th came and went without my noticing – what a relief. I’ve disliked this weird christian cult commercial crap most of my life. The worst is the dentist drill ear worm carols. I literally wear custom ear plugs with headphones over them, so I’m not subjected to them when shopping for groceries. What I can say with certainty is that it’s great for the rich. I don’t have any issues with other “celebrations” because they’re not in my face or drilling into my ears.
    So, that’s a plus for Vancouver. Excepting the Filipinos that have been brainwashed by the white man’s god (what’s up with that?), most Asians aren’t into the coca cola santa. In my largely Asian neighborhood there’s hardly a crapmass light – just the Portuguese contingent – descendants of the vicious colonizers, no doubt, who like the other imperialists had their white god on their side.

    • hahaha this is so funny…..

      XMas is a good excuse for my highschool buddies to make the extra efforts to get together and catch up. My family tend to travel from XMas to NY since you get a whole week or more with as few as 3 vacation days.

      Other than that, it can be chore, with all the obligatory secret Santa, gifts, etc, etc. Personally I think most people are dread XMas and find it a chore more than anything else, except the shopaholics….

  9. Some requirements for a well working democracy:
    1 – An educated and engaged populace
    2 – Check and balances that prevents subversion of people who are elected by special interest groups
    3 – Tolerance for minority
    4 – Rational, fact based, and bias free expert opinions & media
    5 – Incentive for people with proper skills, experiences, drive to help others to run, without extensive existing wealth or backing from special interest groups.

    Without those, a democracy is likely to fail over the long run. Just look at US political system dominated by career politicians bought and paid for by special interest groups, and an electorate that’s more interested in Kim K than all the issues that is going around just in their country. As well, forcing democracy on people who never want it or is not ready for it just spells disaster as demonstrated by US efforts to spread the democracy love in ME. Democracy has to come from within, from the very people it will represent.

    btw, looks at Taiwan, a lot of Taiwaneses I know don’t think Taiwan’s democracy system is really working, nor do they believe Taiwan as a whole is ready for democracy right now. As for China, many believes democracy or some form of meritocracy based democracy will come to be in the future, not as of right now, there are too man other much much bigger problems to tackle and realistically, it will be 100+ years before China as a whole is ready for democracy.

    There is also a good % of population who believes democracy will not work in China period, due to the last 2000 years where China ALWAYS plunge into decades to century long civil war when the central gov’t is weak.

    It’s not so much that Chinese don’t know they want it, it is more that they know what do NOT work given the history and culture. You will be hard pressed to find Chinese who believes China should be split up, or have their region declare independence. But at the same time, the amount of inter-regionals animosity and riverlry is unbelievable. North vs South, Interior vs Coast vs Sichuan, Northeastern 3 provinces vs rest of China, etc, etc, etc….

  10. I see lots of people have a lot of spare time on christmas eve. First of all, I love El Ninja’s assertion that I said chinese people can’t decide. How many democracies in the world actually have populaces that are fit to run a democracy. I bet you not as much as you think. Just think about the whole transportation plebiscite here, no one voted for it because it would cost money, seriously, that’s how educated we are as a population? Or better yet, the HST was voted down by voters who would benefit the most from it being implemented. So yes, forget about China, even in the western world we have a lot of voters who don’t know what is best for themselves. I believe like Space democracy in China would bring chaos frankly and don’t want it for China. A lot of chinese also don’t want it. So there will always be money that will flow out of china as a result of this, you are seeing the tip of the iceberg frankly.

    Secondly. The only investment thesis that El Ninja has put down is the fact that we should all just invest in the market index funds and forget about it. But if you think real estate is overinflated, doesn’t that also apply to stocks? So, you think one asset class is overinflated by low rates, but another is properly valued because as you so eloquently put it, the investors in the stock market are “forward looking”. Oh I guess market crashes never happen then right? Here is news for you, every investment is speculation except arbitrages. Investors always bet on something as part of the investment idea, the professionals hedge away all the other risks associated with it. For example, if I was a professional trader on vancouver real estate, I would long Vancouver Detached and short attached. This is to bet that foreign money will have more of an effect on Vancouver Real Estate than local money. So the fact that you are putting money into the index funds is just as speculative as someone else putting money into real estate. Just that you feel historically in a 30 year window you have been more right on your speculation. So I don’t see how your investment thesis isn’t narrow sighted and infantile because I guarantee you everyone on this board has had someone at some point say the exact same thesis to us. The difference is that those who actually know how to play the markets properly understand what they are betting on and how to hedge away the rest whereas you just blindly go with what as I have described every CFP proclaims everyday. Notice how I focus on one segment of the real estate market and you categorize everything the same.

  11. Btw, one more note for El Ninja, what would have been your investment thesis for someone deciding whether to buy the Google IPO years ago. Would your thesis have caused you to buy it?

  12. 9 Heatmaps showing Vancouver housing prices by housing type and YoY price increases.


  13. “But if you think real estate is overinflated, doesn’t that also apply to stocks?” Hmmmm . . . well, no, not at present, or at least not nearly to the same degree as to local real estate of all kinds.
    Do you have another question?

  14. space889 and Brian: I wouldn’t be so smug. You underestimate people. Yes, they can engage in herd behavior at times (witness Vancouver RE) but over time they are quite capable of judging what is in their interests, and what is not. The key is that they possess the democratic institutions through which to express and enforce their will. The little piece of paper that is a college diploma is not necessary.

    Such a system is terribly lacking in China, and you can’t say it wouldn’t work, because it’s never been tried. There is nothing inherently incompatible in the Chinese people or their culture that precludes them from engaging in a western-style democracy. The massive Chinese diaspora seems quite functional and participatory in the various democracies in which they have settled.

    Canada is extremely fortunate in this regard. So is the U.S., by the way, which you wrongly exemplified as undemocratic. The country has its faults, but you should note that power is more decentralized there than in Canada, and there are more checks and balances.

    Re: investing. I have only mentioned index funds in passing. My relevant thesis to this blog is: don’t invest in Vancouver RE at this time. I’ve given my reasons, and there are many. Knowing what not to invest in is every bit as powerful as knowing what to invest in.

    Canis has it right re: Stocks vs. RE.

  15. China Proposes A Fix For Its Crashing Housing Market: “Transplant” 100 Million Farmers Into Its Cities
    source: http://tinyurl.com/nkal5uo

    Furthermore, as we have also shown before, when it comes to household wealth, in China real estate is of far greater importance for the perception of wealth than the stock market – in fact, as a percentage of relative wealth, for Chinese residents the real estate market is the equivalent to the stock market for Americans.

  16. My family and I had a wonderful Christmas.
    Happy New Year to all

  17. @Canis, what is the mean P/E ratio for the S&P historically and what is it today? Does that not say the market is over valued by the rationale that most of the bears have been presenting on this board. I am not saying I personally think it is. I just find it amusing that people here keep on talking about how bad we are compared to historical averages when in fact if you do want to tallk stocks and you want to examine a time frame greater than say 20 years then you will realize that S&P’s PE ratio is actually quite absurd in terms of its historic average. But… it is not when in context of the last decade or so.

    @El Ninja, two points. One, I can understand your point of view on China and you are right, I can’t say it won’t work because it has not been tried recently. Actually, it has kind of been tried after the qing dynasty collapsed and the country fell into chaos. Anyone with any knowledge of Chinese history would agree with Space that China has fallen into chaos whenever there has not been a strong central government. What most chinese people say is that as long as the country stay out of the way of people making money and people’s personal interests, people could care less if it is a democratically elected government. The uproar over the tiananmen square massacre and the falungong incidents is more from the west, if you poll the average chinese person most of them do not care too much about either incidents and view them more as distractions than issues. So in this regard, I do not see a strong desire or benefit of democracy in China and prefer a strong central government to keep order and maintain the peace.

    Secondly, I never disagreed with you that there are risks in the market. Remember that I am the one who dislike the attached market in Vancouver because of my analysis. You keep on bringing this as an investment problem which I fundamentally disagree. I do not see this as an issue of investment but rather a place to live. From that regard, the nature of what you and I are examining is very different. For investments, I have no upside risk. If I passed on the google ipo then I could just say, oh well, do not have to ever touch it then. But for a place to live there is significant upside risk. Let me frame the issue this way. Take someone like me for example, suppose my problem is that I have to get a single family home in Vancouver and my time frame was from 2010 to say 2020 (hell I or my wife can’t wait forever). What do you suppose my decision should have been? Because if by the year 2020 I don’t get one then it affects everything in my life. This is why unlike you, most people can’t view this as a pure investment. Because they can’t simply say, oh well, just never get one. From this regard, the bet has to be right one way or the other and has to be within a right timeframe because your significant other is likely wanting to settle down at some point and not everyone will simply move away from here because let’s face it, there are a lot of pluses in this market despite of its price. You never addresses this upside risk in your analysis because your idea is, if you wait long enough then it will go down far enough. To most people in Vancouver, this isn’t practical. They can’t wait 20 years for the market to crash because their life will be severely affected by then.

  18. Is the S&P 500’s P/E ratio 3 or 4 times its historical average?

    If someone anywhere in the world with capital to invest saw a city full of people who think about real estate the way you do, the temptation to speculate in that city’s real estate market would be pretty irresistible.

    • Is Vancouver price indices at 3 to 4 times historical average? According to teranet, we are running at about double on every metric that you see. S&P P/E ratio and the shiller PE ratios are running about 1.5 times the historical mean. So.. are we really that much off?

      The other thing that people here should realize is that there isn’t much investment from the rest of the world in Vancouver Real Estate. Even the chinese aren’t here to invest in our property. This has been way overblown by the media. This is their home, just like any other rich person, they may have several homes around the world, this happens to be one of them. They need a place to live for their wife and kids who attend school here. They aren’t here to flip houses. As one associate of mine once so eloquently laughed off our media reports that they are here to invest, chinese business people have much easier avenues to make money than investing in Vancouver Real Estate. The returns here, though impressive, are not anything compared to what they are used to in China.

      • You are conflating three categories that need to be kept distinct for discussion to be constructive:
        1. “This is their home”
        2. “Just like any other rich person, they may have several homes [more accurately, pieces of residential real estate] around the world, this happens to be one of them”
        3. “They need a place to live for their wife and kids who attend school here.”
        We might reasonably ask whether so many people in categories two and three would be **buying** houses here if speculation in that market had not been so rewarding in recent years. I have rented places in the US that people had bought for their children to live in during university years but then clearly felt stuck with because the market collapsed before their children were done with them. These purchases initially had been regarded as convenient for their offspring and and also as opportunities for speculation. Things didn’t work out as planned.

        “They aren’t here to flip houses.” Well, somebody sure is.

        If, historically, markets are stable when average residential real estate properties are priced at 3-4 times average annual salaries, then Vancouver real estate is much more overpriced than the S&P 500.

        I do appreciate your remarks, though, because, you know, like most others on this blog, I have never actually met a Chinese person or a rich person.

      • Err.. first of all, Vancouver has always been more expensive historically than the so called 3 to 4 times average that you are talking about. Again, most indices indicate that we are running at about double the historical means for this market. Remember, one report came out and said that whereas real estate prices have appreciated 64% in the last decade, incomes have only appreciated 36%, this is for greater vancouver. So from this scale, I don’t see how off we actually are from the s&p. I still don’t get where your we are 3 to 4 times above historical means come from.

        Second of all, how can you say there are three categories when in fact all three are related. Why you couldn’t do all three? Is it such a stretch to believe that rich people have second homes? Use the following criteria and tell me how many cities in the western world could a rich chinese person find them.

        1. Ease of integration, so little language barrier.
        2. Clean air and water to escape the chinese cancer factory.
        3. Good education system.
        4. Non-extradition treaty with China.

        Finally, why do you believe that renting is such a good alternative? Renting is only good to cultures that value freedom over stability. For any cultures that value stability over freedom renting is a terrible choice. Truth is, we are all renting something, whether it’s money or space. Some people feel it is more stable to rent money, who are you to say that it is the wrong decision?

        But you know, you can keep on believing like El Ninja that somehow our local incomes could have propelled the market to its current valuations. I’d like to hear your explanation on how we could have achieved our current valuations using local incomes especially given that our richest areas are reporting some of the lowest incomes. Cause seriously, you really could support the 3 million dollar house with 25K a year of income.

  19. Recently, I told my kids that Ottawa was one of the coldest capitals in the world and that if they relocated it here, property values in Ottawa would plummet there and double in Vancouver. My 9 yr. old asked how the capital was chosen. Had to look it up. Turns out the capital used to be perambulatory until it was chosen by the pirate queen Victoria to placate British and French interests and keep the Yanks at bay. I once spent a couple of winter weeks in Ottawa. Skated on the Rideau Canal into the driving sleet. OMFG. What would Canada be like if the capital was moved?
    I also spent a winter in Moscow. OMFG. Great for defeating Napoleon and Hitler, but to live there by choice?
    I have a question I’d like to throw out. When I look at houses for sale, new or used, I automatically calculate the square foot cost of the entire amount – the irreducible metric. That gives me the clearest picture of what “old timers” cost and what is the cost to build new. But I have never seen a detached house advertised with this square foot cost of the entire property. Why is that?
    It’s offensive – this peculiar term “old timer,” like it’s some piece of crap not worthy of an actual build date – not worthy of saving. The house we’re in was built in 1913. Eleven years ago it’s value (with the garage) was assessed at 25K. Ten years later it was 28K. This year it’s 38K. Twenty years from now it will still be standing. I suspect agents do this to beat down the ask of the sellers. But it scares away new buyers and attracts builders with the ready cash. Another house bites the dust.
    I’m also curious to know how many agents there are per listed detached property. I suspect it’s in the neighborhood of at least 50 to 1, but it could be 100 or more. Anybody know?

    • I actually have some of the info that you are looking for.

      1. The reason why the numbers are not presented this way is because it is not uniformally presentable. For example, say if you had a 2000 sq ft home sitting on a 7000 sq ft lot, how do you want this number presented? As a total sale price divided by 2000 sq ft? But what if your lot actually allows you to build a 4000 sq ft house. Then you are not maximizing the potential of the land. For me, a more accurate representation is the way the government does it which is land and building separated. The land value shows me the potential of the land and the building value is well.. usually not worth very much if it is older than say 50 years. The funniest thing of all this is that the Old Timer buildings that you are talking about are much better built than what they build today. I would much rather do a studs out reno than a rebuild. But many people also rebuild to take advantage of the additional square footage they are allowed. Vancouver are now allowed to build 0.7 times lot size.

      2. There are a ton of realtors in Vancouver. But most of them aren’t serious realtors. The really serious ones are only about 10 to 20 percent of all realtors. There are a few good ones and the rest are well, questionable. I think the latest numbers is about 12000 realtors in Vancouver. My guess is that there is about 4000 full time ones, the rest are just guys with a license more for personal use.

      • “Studs out reno” are words that sound good, thrill renovators, and massively fatten their wallets. I’d caution against it if the house is old enough to have lath and plaster – this artisan product is irreplaceable and infinitely superior to drywall – well worth the pains to maintain or restore. It is stronger, sound-deadening, and has character. If you ever see the old scratch marks and horse hair of old plaster, you’ll not waste it with a studs out reno.
        I’d also caution against a .7 build-out of a lot – you’re getting a big expensive basement and losing the more valuable space you’d be allowed above ground with a .6 build. Is above ground space worth more than basement space? Absolutely. How much more? To me, there is no comparison. It’s like the difference between a house on a busy street or a quiet one. I wouldn’t live on a traffic street, and I wouldn’t live in a basement. The difference between the .7 and .6 is not a simple percentage of lot size, but subject to a curious formula (in the schedules) that favour small lots. This is partially why larger lots have a smaller per foot cost than smaller lots.
        Builders love basements. They are very profitable. They’ll tell you it’s a great place for rentals and ideal for the mechanicals. a) nobody wants to live in a basement and b) you shouldn’t have mechanicals. You should go electric and have tankless water heaters with the provision for future solar panels. This way you avoid the frightening furnaces/boilers and hideous headspace robbing duct work, so you have superior space to use or rent out. The air will be cleaner too. People are misled into thinking that heating will be cheaper. When you factor in the yearly maintenance visit from the furnace man (oh joy), and the filters to be changed every three months (oh joy), this perceived cost advantage starts to vaporize. Also, electric is simple to zone which lowers the cost. Why heat the whole house when you are sleeping? Not to mention that furnaces, esp. the high-efficiency ones, are noisy. I hate them. They are scary and nasty and they take up a lot of valuable space. And they’re a greater cash outlay than electric. Would you want to sleep next to one. And what of the potential of carbon monoxide? It’s a quality of life issue. It’s curious how people will toss money away on a luxury car and then live in an inferior environment to possibly save a few bucks on heating. You can go to a hardware store and buy oil-filled electic heaters: plug and play. It’s that simple. The furnace man should go the way of the dodo.
        And I always calculate the square foot lot cost of a property regardless of any improvements.

      • That’s some good info about house constructions. Just curious, does the electric heater & water system cost more than the existing furnance system? I see that most of the new builds – duplex, townhouses, etc are all still using the furnance & water tank system.

      • This is pretty interesting what you have there. I have always hated radiant heating because seriously who thought it was a good idea to introduce more water into the house than is needed. However, I will reserve judgment on the rest of your post there. I believe in maximizing the square footage, Vancouver lacks density as it is.

  20. Ottawa is a “compromise capital” chosen to not upset the interests in Toronto or Montreal. Washington D.C. is the capital of the U.S.A. not the competitors New York and Philadelphia. George Washington owned a lot of land on the Potomac river. Canberra is the capital of Australia, another compromise capital.

  21. pffft! … capitals will be scarce, please keep safe and use sparingly … http://tinyurl.com/o3bp8xu

  22. When you compute the costs of electric (and the future addition of photovoltaics) vs gas furnaces and boilers, there are so many variables. The current practice of running hot water pipes under floors (radiant heat) is a massive improvement over those hideous air ducts and plenums. However, the old polybutylene pipes have a history of failure – leaks – the newer Pex ones are purportedly ok. A leak in a pipe under your floor is not something to bring joy to your heart. Ever notice all those flood and restoration trucks? Water is your enemy.
    How can anyone possibly know the long term durability of these materials? Look at OSB. It’s even code approved for multi-story construction. Do builders use it? Rarely. That garbage can pass a factory inspection, but put it out on a real world construction site and see how it holds up.
    So, regardless of cost, do you want to own a gas-fired furnace and a utility room. If electric was in fact more expensive, wouldn’t it be worth the cost?
    Lay people, in the sense of the construction industry, are intimidated by so-called experts – whether it’s the city building department, or contractors. If they’re that knowledgeable and you’re such an idiot, then what about the leaky condo crisis? An engineer’s report (available at public libraries), called this ongoing event the biggest man-made financial disaster after the atomic bombing of Hiroshima. It ruined people’s lives.

    • Thanks for the info…much appreciate it. I too have doubts about the radiant heating and the durability of water pipes.

      As for construction, I have seen 4 to even 6 level condos around Cambie that are built with what looks like mostly particle boards. All drenched in the rainy weeks and then 1 day of sunshine and have that Tyco paper glued/taped over it. Can’t imagine how well those would hold up, or how quickly the mold would come.

      I think in Vancouver, we are at a point where cost consideration and “green” requirements are overriding common sense and actual cost/benefits analysis.

      • I’ve got some random comments on building standards, heating, and the like…

        OSB: years ago I dealt with a residential siding installer who hated OSB– he found that the nails holding his siding in the OSB would tend to pop out a bit, leading to rattly or saggy-looking siding. So while the builder saved a couple of bucks on sheathing, the siding installer upped his price to add more rainscreen set-offs. Beware unprofessional siding jobs, which will end up sagging/rattling.

        Water exposure during construction: not as big of a deal as one might expect– every building here is exposed to water while it’s being built. Once the siding’s on, the wall dries out, before the drywall seals up the inside. Beware: as the wood dries out and shrinks, nails can pop out a bit (particularly noticeable on interior drywall).

        Leaky condos: what a disaster that was. Building codes required the wall to be sealed up inside & out. Great idea, in theory– no water or vapour going in, none going out! In practice, it was terrible. Walls are never perfectly sealed, stucco can crack (breaking the seal), caulking cracks, workers don’t do a perfect job, etc… And once the water’s in, it doesn’t get out, and allows mould to grow. Now that rainscreens are required, it’s much better– water can hit the outer surface, and if it gets through, it’s in the airgap, where air circulates to dry it out. The inner wall cavity is unlikely to get wet, let alone have moisture in it. Builders can still screw it up, mind you, but it takes a pretty egregious screwup to end up with water in the inner wall cavity now.

        Hot water heated floors: I have them in my current house (built 1993) and I love the hot water heated floors. The floors are warm, and the house is consistently warm. I have no idea how long the tubes will last, though, and I don’t imagine a leak will be fun. Another benefit: by embedding the pex pipes in concrete, the floors become very heavy, which is great for sound-deadening. My basement tenant has to turn his music up to ear-splitting levels for me to hear the any noise.

        Gas vs. electric: natural gas is cheaper than conventional electricity, per unit of heat that you get out of it. Roof-mounted solar power is still a long way from being viable in Vancouver– we just don’t get enough light, and Hydro’s electricity is too cheap. The payback period, even with the current ultra-low interest rates, is about 15-20 years. (How long will the panels last? How about the AC inverter? What if you need repairs? When your roof needs replacing, it’s going to be extra-expensive!)

        Electric heat pumps: basically an air conditioner that makes the outside air colder (by taking the heat out of it), and “pumps” that heat into the house– these can get 10 times the amount of heat energy out of it than the electricity that you put into it. And they can provide cooling in the summer. Generally requires that you have a central ducted heating system. If I was to build my own house, this is what I’d have.

        My neighbours’ new house has heated floors in the basement, and a ducted heat pump/air conditioner for the main floor and top floors. The air conditioner/heat pump is located under the outside basement stairs, feeding hot/cold fluid to an air handler located ***in the attic***! So there was no need to waste square footage for the mechanicals. Also, no ductwork is visible: the skinny ducts run down the walls (between the studs).

      • @ M

        re OSB
        water exposure is always an issue; i still see attic, crawl spaces etc that never fully dry out and wind up covered in a black mold

        re leaky condos
        this issue is still ongoing; now many highrises have issues too; imho certain bldg materials just shouldnt be used here regardless of the method of installation; even if installed by the book, homes are still subject to an onslaught of water; i betcha the flat roofed “westcoast” style homes which are all the rage now will have major issues in the not too distant future; and no one seems to talk about all the windows and glass that many properties are outfitted with. major $$$ to fix and replace after the fact not to mention the lack of energy efficiency. hey, but as long as it looks good, nothing seems to faze people nowadays

        re hot water heated floors
        imho these are a nightmare for two reasons; eventually there will be a water issue; the repair bill will be substantial if not financially crippling (since what repair doesnt cost an arm and a leg nowadays?); second problem is the monthly overhead; i know many people who routinely fork out several hundred every month for gas; imagine what the tab would be if it actually got cold here?

        re gas vs elec
        while gas might seem cheaper, i found the opposite to be true in real world application as there is no instant on/off with hot water radiant heat and it seems pretty much everybody has either hardwood or laminate flooring; yes, solar is a far fetched fantasy for vancouverites; never gonna happen in my lifetime

        in the coming yrs many homeowners will have no choice but to re-focus on the costs to operate and maintain an “appropriate” sized home properly as prices for pretty much everything are on the rise (and in some case going thru the roof) VS putting so much emphasis on the cosmetic nonsense and owning the biggest house on the block.

      • I personally wouldn’t use OSB as a building material, and I’d pay substantially less for a building that was built with OSB.

        That said, if a crawlspace or attic is consistently moist enough to allow black mould to grow, whoever owns the place needs to sort out the source of the moisture– whether it’s a persistent roof leak (combined with insufficient ventilation), an exterior wall leak (especially in non-rainscreened walls), or excessively moist interior air ducted into the attic (major problem with grow-op or former grow-op buildings). OSB will rot quickest, but plywood will also rot.

        Flat roofs: My problem is with the lack of overhanging eaves– it allows that much more exposure of the wall to water, increasing the risk of problems within the wall. I’ve got nothing in particular against flat roofs, and the Barrett report found almost no roofs to be causing leaky condos.

        Instant-On/Off: I hear you about the lack of instant on/off with hot water heat. I’ve got to leave my heat on at a constant temperature 24/7. If it cools down, it takes hours to heat back up. The boiler shut off when I was on vacation recently, and I tell you it took a solid day or two for the place to feel warm again.

        Gas vs electric: my heating bill for a maximum-size 20-year-old house (fireplaces + floor heat) is $80-150/month, and the boiler is an ancient inefficient unit. My biggest-ever bill was $170. At $0.11/kWh, a single electric space heater will cost $120/month if it’s running all the time– and that’s not nearly enough heat to keep an entire house warm (I tested this out recently when the floor heater failed!)

        Appropriately-sized houses: unfortunately, the current madness for real estate means that every lot will be built out to the maximum extent possible, as everything is based almost exclusively on lot value. Hopefully this will change.

  23. SCMP: Vancouver’s hot housing market, spurred on by the seemingly endless supply of Chinese money, was the topic that gained the most interest among our insightful and provocative commentaries.

  24. I appreciate these latest contributions. M’s neighbor’s heat pump under the stairs and air handler in the attic with skinny ducts sounds interesting – and complicated. Do these ducts somehow go through the floor plates? Are these ducts carrying fluid or air? Is the basement floor also heated by this heat pump? Seriously, my brain is starting to hurt.
    M says his gas bill is lower than electric, but Bullwhip suggests that in his/her real world the latter is cheaper. Whoever is correct, one must keep in mind the capital outlay of these two approaches. The basic price of a gas furnace and ductwork or boiler and Pex is north of 10K. An electrical installation is probably 10% of that, so that from the get-go you’ve got 9K plus to pay for heat. Add to that number the cost of yearly happy visits by the maintenance guy @ $200. plus; the filters @ $20.; duct cleaning; extra tissues because your family will be blowing their noses all the time from the dusty air; the 100K loss when your radiant leaks; the difficulty in keeping tenants willing to live beside these fire-breathing noisy beasts; the sued into the poorhouse because your tenants died of carbon monoxide poisoning …
    I do like the idea of this exterior heat pump and air handler in the attic though, but I suspect the cost is high and that it entails a lot of drilling, routing, and, well, weird stuff. I also like concrete floors, and concrete houses – with or without radiant. Think about it: houses are built like pianos or guitars – a wood frame with a wood covering – designed to resonate. They are noisy. The big difference is that houses are essentially plastic bags inside – call them vapor barriers if you wish.
    Tesla does not pursue gas technology. They understand that it’s all about electric. And with a house you don’t need the pricey lithium battery back – you’re on the grid. To save serious energy $, I think the best approach is to have exterior insulated automated shutters. As a bonus, they provide security, darkness, and blessed quiet.
    And quiet is priceless.

    • The neighbour’s system has the air cond module out back, with insulated pipes carrying hot/cold fluid to the attic-mounted air handler. The skinny ducts start at the attic, come down an interior wall (2nd floor), pass through the floor plate, and are then diffused at the main floor’s ceiling, or ducted further down an interior wall at the main floor. Here’s an image of a conventional basement-installed forced air system: https://wwwtoolguy.files.wordpress.com/2010/11/gravitywell.jpg
      Imagine that system upside down (“furnace” and trunk duct in the attic, with ducts going down through the walls), and it’s basically what my neighbours have. I don’t know if their basement floors are heated by the heat pump or not. Their system is definitely a “premium” system, and was not chosen for low-cost; instead, it was probably chosen for either low energy cost or maximizing usable square footage.

      Gas costs: some people can get an inaccurate impression of gas costs based on shitty old buildings. I once rented an ancient east van house, and the gas company warned me that the natural gas bills for the house would peak at over $600/month. The first week I was there, the furnace was on pretty much constantly, and the place still felt cold. Occasionally the furnace would shut off, for about a minute or two, before it kicked back on. The problem was crappy insulation in the walls, and horribly leaky ancient wood-framed windows that were letting air blow around the glass. I put some of that plastic shrink-wrap stuff over the windows, and from there the house’s winter heating bills were about $150-200/month. And that’s with a 50-year-old low-efficiency furnace. If it had electric heat, that wouldn’t solve the house’s problems of leaky single-pane windows and no insulation.

      Electric costs: most buildings with electric heat are newer condos– each suite has relatively little exposure to outside walls (i.e. 3/4 of a condo’s walls are interior), so there’s less opportunity for heat to escape. Recent construction means walls are decently insulated, and windows are double-paned. The space/cost of installing a forced-air furnace doesn’t make sense for a condo. But the economics are different for an entire house.

      Maintenance: I’ve never known anybody that actually pays a technician for annual maintenance on furnaces, let alone routine duct cleanings. I certainly haven’t, my parents haven’t, my in-laws haven’t, and it hasn’t happened in any of my rentals, either. In my experience, maintenance people are called in when there’s a problem (generally a rare experience). Furnace filters (BUY THE GOOD ONES) take 30 seconds to replace, once a year.

      Installation of furnace vs electric: there’s a reason why pretty much all houses have furnaces. They aren’t that expensive up-front to install, and electric is much more expensive than you’ve estimated. In-floor heat is a “premium” option, and is more expensive; it’s not chosen for cost reasons.

      Dust: forced-air heaters don’t actually create dust. They just circulate your house’s air past a hot heat exchanger, to make the air warm. Thanks to the filter, they actually *reduce* the amount of dust in your house’s air, by filtering it out.

      Carbon monoxide: poisonings are extremely rare, generally resulting from a cracked heat exchanger (very rare), or blocked exhaust pipe (also very rare). Protect yourself from liability/injury by installing a couple of CO detectors. If people were frequently dying from CO poisoning due to furnaces, it would be on the news.

      The shitty rental I mentioned earlier had a faulty furnace– blocked exhaust. The windows in the house constantly fogged up due to water vapor in the exhaust gases. I brought a gas detector from work, and nothing dangerous was present in the air. Called the landlord, who had somebody service the furnace the next day, and the windows stopped fogging up.

      As much as stucco is vilified [for not being suitable for our wet weather], it’s a great building material for helping to stop outside sound from coming in. With wood or vinyl siding, you’ll hear every last sound from outside.

  25. It is true that forced air furnaces do not create dust, but they do swirl it around – query forced air with dust and allergies. Good point that you should buy quality filters and change them regularly. I resent spending that money however. It also sucks sitting near air grills – because they blow.
    Glad you stated you and yours have not paid for furnace maintenance. Our old furnace pooched a couple of years ago, and we were forced to spend the better part of 6K on a new one. Subsequent years, the installation company has been sending “discounted” offers to “adjust” this unit – that this keeps the warranty intact – $200. plus tax. I’ve ignored this offer, but have been a little concerned because I’m not sure about these things. Your comment alleviated these concerns.
    Re. air to air heat exchangers: what I’m happiest about them is that my neighbor does not have one. Query heat pumps and noise and see what comes up. People complain that not only is their yard rendered unusable, but that this particular noise penetrates even triple glazed windows. I am hyper sensitive to noise – when we sit down to eat, even the fridge is always turned off until we’re done. Which is also why I find all these “open concept” kitchen/living rooms horrific. Give me quiet. The sooner I can buy a thermoelectric fridge the better. The old days of ice boxes were quiet.
    I used to live in a century plus house that had a cupboard with thick slate shelves. There was no insulation between the cupboard doors and the exterior wall; so when you opened those doors it was seriously chilly in there. It kept perishables brilliantly during cooler weather. The cupboard stood about 3′ off the ground and was maybe 7′ high – totally within the ORZ (optimum reach zone). Its depth was just over a foot. I miss that thing. It was wonderful. It seems to me it could be replicated – you should have it facing north – and improved by the addition of an exterior mounted compressor.
    Back to gas vs electric – clearly, the latter is the superior distributed system. It’s the trolley bus vs diesel. If this were Winterpeg or Iqaluit, it would be a dire necessity to focus on squeezing every penny from every joule. But it’s not. Better to wear a fleece than suffer a furnace.
    And stucco – stucco is good, though it sounds odd if you say it a few times. It’s crazy hard work though. What amazes me is what it takes to get to that finish coat on a wall plus the paint. Think – working in layers – from the outside in: paint, finish coat, scratch coat, rough coat, wire, house wrap, plywood, studs, insulation, polyethylene, drywall, tape, mud, sanding, primer, paint.

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