Zerohedge: “Vancouver Housing Market Implodes”; “Devastated”; “Slammed Shut”; “About To Get Very Ugly”

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“Three weeks ago, when we looked at the long-overdue sudden change in the Vancouver housing market, long a receptacle for Chinese hot and laundered money, we found that as a result of the implementation of the 15% property tax implemented by British Columbia (something we recommended over a month earlier), that the Vancouver housing bubble has burst.

We concluded this based on anecdotal evidence by local real estate professionals: “As a new dawn breaks in Metro Vancouver’s real estate market, realty companies and real estate boards are reporting the first anecdotes of deals falling through as foreign buyers forfeited deposits on binding deals rather than pay the new tax. Worse, if only for the unprecedented local housing bubble, and certainly better for potential local homeowners who were locked out from the massively overpriced market, they report evidence of local buyers withdrawing offers in expectation that the market will soften.”

Less than a month later, there is also hard evidence to confirm this assessment. According to Global News, evidence from realtors and MLS data is showing the Vancouver real estate market is in the midst of a major slow down, with prices dropping and sales plummeting.

While August is typically one of the slowest months for real estate transactions, MLS sales data from the first two weeks of the month shows what many have been hoping for during the last few years of escalating prices. According to realtor Brent Eilers, using MLS listing data, there were only three home sales in West Vancouver between Aug. 1 and 14 this year, compared to 52 during the same period last year. That’s a decrease of 94%.”

Global News obtained MLS sales data from several key Metro Vancouver markets and found the number of homes sold during the first two weeks of August in Greater Vancouver dropped by 85% on average. Richmond experienced a 96% drop in the number of sales and Burnaby North fell by 95%. Vancouver’s West Side, West Vancouver, and Coquitlam also took major hits.

It appears that the Vancouver housing market has slammed shut.

Which is hardly a surprise: virtually everyone saw it coming, the only question was when. Eilers says he’s been warning of a real estate slow-down for at least a year due to the region’s unsustainable and unsupportable prices. West Vancouver, where he does a large part of his business, had a benchmark detached home price of almost $3.4 million in July according to the Real Estate Board of Greater Vancouver.

“The market in West Van is up 450 per cent since 2001. So is everyone making 600 per cent more income than they were so they can pay their taxes and buy their houses? Of course not. So how is this inflation been financed? By off-shore money and record debt.” Precisely what we said at the start of the year when we first heard horror stories about Chinese buyers paying cash, sight unseen, for any and every local luxury, and not so luxury home.

It appears that it is not just the 15% luxury tax implemented on on July 25 that has burst the bubble: according to Eilers sales were dropping even before the tax. According to the data, July was another slow month in West Vancouver with only 44 sales, down from 80 in 2015. June saw 74 sales, also down from 102 the year before.

The pattern has left the market “devastated”, Eilers adds.

While it may be too early to make a definitive conclusion, after all while earlier this month, the REBGV released its statistics for the month of July, saying the data showed the market had slowed down to “normal levels”, there was still no official August data available, and thus no actual indication of the slowdown. Fortunately for buyers, real-time data proves otherwise.

Zolo, a Canadian real estate brokerage, keeps track of MLS home sales in real-time and reports prices as an average rather than the “benchmark price” used by the REBGV. It currently shows a major correction underway in most Metro Vancouver markets. According to the website, the City of Vancouver currently has an average home price of $1.1 million, down 20.7% over the last 28 days and down 24.5% over the last three months. The average detached home is $2.6 million, down 7% compared to three months ago.

If the bubble has indeed burst, things are about to get very ugly. Eilers says that in the 1980 housing crash, prices dropped by 40 to 60% within a year and took six years to recover. “So your $2 million house became $800,000 in five months. There’s a lot of economists and a lot of wise people that believe that our financial structure is much closer to that structure from a corrections’ point of view,” Eilers explained.

One thing, however, appears certain: the foreign money influx has stopped. Zolo’s CEO says the foreign buyer tax has certainly stopped speculative buyers. This has caused many other buyers to take on a “wait and see” approach, which has essentially frozen the market.

News of the foreign buyer tax has spread to China, where Chinese real estate website Juwai now promotes other Canadian cities as foreign capital destinations. The website used to promote Vancouver as one of the best places for wealthy Chinese to invest, but has now switched to publicizing Calgary and Alberta due to the tax.

Which means that while one bubble is bursting, another is about to start, even if it is smack in the middle of Canada’s bleeding oil patch.

That said, this is good news for ordinary Vancouver residents. NDP MLA David Eby says the tax has caused a lot of people to hit the pause button on buying homes, but all those people might come back into the market in September. Despite his reservations on how the tax was implemented – he would have preferred an incrementally-increasing tax – he says a market slow down is good news.

“A lot of people have said to me quietly that they hope there is a substantial housing crash.”

Well, it appears they got what they wanted. Now the only question is what happens once Vancouver “corrects” by 30%, 40% or more – will the Chinese buyers stay away permanently or, like a good S&P500 algos, simply BTFD. We will have the answer in a few months.

– from Vancouver Housing Market Implodes: Average Home Price Plunges 20% In 1 Month – “The Market Is Devastated”, Zerohedge, 19 Aug 2016

As the article says: “If the bubble has indeed burst, things are about to get very ugly.” – vreaa

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116 responses to “Zerohedge: “Vancouver Housing Market Implodes”; “Devastated”; “Slammed Shut”; “About To Get Very Ugly”

  1. I hope it’s right, but my fear is that the realtor isn’t pulling their data in the correct way. In ~2012, as the market slowed, one or two realtors were pulling data that showed the market to be collapsing (as seen here). However, it was just slowing, and they were pulling data the wrong way.

    Timeline below is rough, but this is my understanding if how it works:
    Day 1: Offer is accepted (“contract date”)
    Day 10: Subjects are removed
    Day 12: Sale is reported to REBGV board
    Day 15: REBGV records the sale (“reporting date”)
    Day 60-90: Ownership transfers to buyer, Province records the sale. (“sale date”).

    The issue with a realtor a few years ago is that they were searching for “contract date” in the current month, and finding almost nothing. The incorrect realtor was convinced that the market was collapsing, but the reports at the REBGV of that sale having taken place doesn’t show up for a couple of weeks.

    PaulB’s numbers showed sales continuing, albeit at a slower pace. The other realtor was convinced that PaulB was wrong, and the debate lasted for a couple of months, until PaulB was proved right.

    The realtor should have been looking for “reporting date” of sales, as that’s the newest info.

    All that said, I hope the news is right this time that the market’s grinding to a halt!

  2. I love this type of reporting, good job Zolo. While I don’t think anyone is arguing that the market has slowed or not, but a 30% decline? Wow, only Zolo could make this shit up.

    Question, say if your sales in march had 30% SFH 30% townhome and 40% condo, and right now your sales are about 10% SFH, 20% townhome and 70% condo, what would that do to your average prices? Is there a reason why we use a system similar to how we measure CPI to measure the market so to get a basket of representative prices for each category. But, you know, whatever makes the numbers look good. I wish there was a 30% drop in westside SFH prices, that would make me very happy cause then I could actually afford one.

  3. Oh, Briiiiian! Space889!

    It’s happening, yo.

    • Yo… let’s talk when we are in your stratosphere. 50% to 75% off of November 2015 prices dude. Good luck with that, I have actual sold listings of benchmark Single Family Homes from Burnaby, Vancouver East, West and Richmond from last november ready for you just in case you are wondering. To give you an idea when your prediction might come true, you pretty much have to hope that a typical detached home in the prime of North Burnaby goes back to about 700K.

      • Btw, that is at the top end of your prediction, your bottom end goes to about half of that, so 350K. So you are looking at 08 prices and 03 prices respectively.

      • Point is, the decline may well have started. It has a long way to go. Sure, maybe there’ll be a dead-cat bounce or two, but make no mistake, Vancouver RE is toast.

        Having adamantly claimed that buyers were pounding at the gates, and would continue to do so unabated, you’ve already been partially disproven. It’s only going to get more painful for you as the data roll in over the coming months and years.

      • Ha? When did I say that the market would go up in a straight line???? Buyers always come and go but in the end the long term trend is that there will be continued foreign capital in Vancouver. I’d like to know how I have been disproved? The government finally figured out that there have been a ton of foreign money and are trying to stop it. If anything they have finally listened to people like me cause that is what we have been saying all along.

        Back when you made your predictions, I told you mine which was that in 3 years (your time frame btw) your single family home price would be higher than what it was at the time. So far, despite of all this, I am far more right than you have.

        At this point I am not sure why government wants to step in other than to quell the anger of the commoners. Your economy is dependent on foreign money, just let them all come in and fund your service economy. If you wanted a productive economy you should have stopped the IIP 20 years ago when your auditors figured out it was going to cause a disconnect between housing prices and incomes. Guess what we have today.

      • The squealing has begun.

        Here’s another prediction. As this bubble unwinds, you and other bulls will find ways to revise your historical position, shift blame, claim foresight, or otherwise dodge responsibility for your mistaken analysis. Either that, or you’ll disappear from this blog, tail between your legs, never to be heard from again.

      • No different from all the bears keep revising the goalposts about how they are right all along for the past 8 to 10 years, and how renters are still getting ahead of homeowners, and how they will eventually get to laugh in those pathetic homeowners faces after the crash at their misfortune, ruined lives, and stupidity.

        yet, when that story about 30 something millennials who “retired” by not buying a house, and did investments instead, it was crickets on VCI, rather than applause about how it validates all is right by the bears. Maybe the fact that couple was Chinese, those VCI bears just can’t bring themselves to cheer a Chinese couple.

      • Dude, I am so hurt.. you forgot that I learned how to shift positions from the best..

        What I will do is, continue to claim that I was right despite of the reality of the facts, claim that everyone else are ignorant.. and claim that somehow in the future I will be proven right.. I just need a 20 to 30 year horizon for my predictions…. you might know where I learned that from… his name starts with El…..

      • First off, I speak only for myself. So don’t put me in with the VCI people, or anyone else.

        Second, I have never changed my position. Not once. I have consistently said that Vancouver is about 2/3 overvalued, and that the correction, when all is said and done, will be of roughly that magnitude. And I said it would occur within 3 years. Not 10 or 20.

        Until recently, you said the market was “just getting started”, among countless other claims of this sort. The idea that detached house prices could come down was, in your view, preposterous. Now it seems to be “well, sure, sales have slowed and, yeah, prices could go down, but…”

        You can keep putting your hands to your ears, like children. Or you can show some humility and admit your self-contradictions. Learn something from this. Grow.

      • I claimed that it was not possible for detached housing to have a correction? Really? Seriously, where was that? I have however denied that detached house could crash, especially to your magnitude, there is a difference between the two learn. I’d like to know where have I flip flopped on this fact. You are right, you have never denied the 2/3 estimate, the issue is exactly that. You have kept that number up from like 2014 to 2015 to 2016. I am sorry, but a 2/3 crash from 2014 is a lot different from a 2/3 crash of 2016. The market has gone up about 40 to 50 percent already.

        Oh, btw, you said 1 to 3 years. I like how you conveniently left out the 1 out of it. Maybe I should go drag that post out for you.

        I like the quote about putting my hands to my ears.. cute. Talk to me when your predictions, any one of them become correct. Learn not to count your chickens before they hatch, they teach that in grade school.

      • So much anger. Very telling.

        I said 2-3 years, and you know it. Which is the same as “within 3 years”.

        Anyway, have you been reduced to disputing differences of a year or two? Lame. This has been a multi-year phenomenon in the making, and it will be in the unmaking. The point is that the market is going to implode. Nobody knows if it will be 2 months from now, or a year from now. Just that it is very likely.

      • See that’s my issue with you. It’s not so much that what you predict can’t happen, it is that it’s useless to the average Joe. You would have told the average Joe, dont’ buy a place in 2008, and now it’s 2016. So even if the average Joe is patient enough to wait for a crash that happens in say another 2 years, he would have waited a decade for a crash that at best might be able to bring him back to 2008 levels. How do you face that average Joe who have waited for 10 years for a prediction that would have put him in the same place as he was a decade earlier?

      • As I’ve said, I speak only for myself. I’m not answerable to the average Joe. But in the spirit of discussion, I’ll address your question.

        In 2008 I would have counseled the average Joe to invest in a diversified portfolio of equities and fixed income, and not a house. From then until now, he would have done comparably well, if not better, than he would have in Vancouver RE (with greater flexibility, and fewer headaches, to boot).

        He wouldn’t be in the “same place”, as you suggest. You forget the opportunity cost of putting most or all of your eggs in the RE basket.

      • Still don’t see how you are ahead. In 2009 march which was the lowest point of the stock market, I could have bought a bungalow in North Burnaby for about 600K. That same one would cost between 1.7 to 2 right now. My family, so not me, but family members bought a detached home a little bit after that time, so they paid a little bit more for it but it’s not that much off for comparison. I had an investment portfolio that started around 2007, needless to say it went down during the crash, the portfolio was doing pretty much what you suggested and would have by 2009 march, same period, approximately an equal amount of down payment for that bungalow which would sit around 120K. So looking at my portfolio and taking an apple to apple comparison up to until 2015 where I put it into hedge mode so that doesn’t really count, the portfolio ran far worse than what that detached house ran even in 2015. That’s not even taking into account of the massive increase in the prices from last year. So I think I have done just about as well as what an average Joe could do in investing because I am actually quite disciplined. But the issue that you have is two folds

        1. Average Joe usually diversify their risk into money market funds that don’t perform the same as market. Very few people can capture the complete upswing from the market.

        2. The discipline factor, average Joe cannot be disciplined enough to put away money into something unless they are forced to.

        I just don’t see how your advice, even if it is correct can be useful to an average Joe in 2008.

  4. So aside from this 15% foreign tax, has anything else that has fundamentally changed the appeal of Vancouver for the Chinese, or factors that stopped causing Chinese wanting to pull their $$ out? I don’t think so.

    As for this 15% tax, uhm…seriously? You think this will stop foreign $$ when most of the foreign $$ actually comes from local PRs / immigrants who aren’t covered by the tax?

    And even if most of foreign $$ came from actual foreigners and covered by the tax, you honest believe all those tax lawyers & accountants would simply stand by and say “yep, good tax to stop foreign money. I’m totally not going to step up, use my brain to find a way around it, and charge exorbitant but still cheaper than the tax fees for the service?” Seriously? All those tax lawyers & accountants are not going to help those foreigners out of the goodness of their heart and public benefits??

    Lastly, if you have $5M to spend on a Vancouver house and want to get the $$ out of China. A 15% extra tax or $750K is not motivation enough for you to say maybe $30K, $50K to find a way to avoid that hit? That all rich people are like El Ninja, who despite having almost absolute conviction that Vancouver Housing prices is going to drop, is simply to lazy & risk averse to find a way to profit from it? Even though it would be the simplest, quickest $2M or $3M per transaction s/he would ever make?

  5. Btw El Ninja, even if this 15% tax is the start of Van house price decline, it doesn’t mean you are right. You were arguing about housing prices too out of whack with the fundamentals, not because gov’t will prick it. So if the house price decline is due to this tax, it doesn’t mean you are right, just that you got lucky that something else made your prediction to come true. Not that it really matters to you I guess. As long as you get to say you are right?

  6. Personally I think the current situation is caused by the suddenness of this tax and that it is affected retroactively. Once the dust settles in a few months, and the aforementioned tax lawyers & accountants figure out ways to get around the 15% tax, I think it is probably going to be back to biz as usual or close to usual.

    • I didn’t claim that the tax was to blame.

      The bursting of the Vancouver RE bubble will be due to the fact it is a… bubble. And all bubbles burst.

      It will implode under its own weight. The tax is secondary.

    • It’s ok, bears are so desperate for good news that they are going to be all over this. Just like 08 or 12, start of the collapse.. oh wait….

      • Big difference between now and ’08. Back then we weren’t at all wall on interest rates, household debt, and homeownership rates.

      • Oh it’s different this time? Where have I heard that before… I could have swore some people in 2012 said that too…

      • Funny you point to history, when you clearly haven’t studied it. Why not do some reading on the subject? You might learn something about bubbles, economics, and human nature.

      • And btw, Vancouver RE in ’08 was already overvalued. It has only become more so since. Prices will revert to 2003-04 levels in real terms.

      • And when was the last time in history that you have seen such outflow of capital from an economy like what you have seen from China? And Van Re was overheated in 2008? i guess we missed the 50 to 100K millionaires that have landed here since then. Guess that should have zero effect on prices.

  7. Reading the comments here from perma-bulls Brian and ilk, as well as those on the Vancouver Sun and various other sites, there is so much anger, bitterness, sarcasm, and denial–and we are only at the early stages of what will be a long, painful grind back to reality. At its deepest depths, I predict riots in the streets. Serious prediction.

    • Not that different than the bears are they? Besides, we have to see if this slowing down is actually the start of what the bears consider to be a crash, cause you know… there have been fakes before.

    • you would make a very good clown. is the rent check ready?

      • Hey everyone, it’s trailer park Fred! Here to dispense useful advice, like “always keep a can of Raid on the kitchen table”.

  8. 1917 22nd Ave E – built in 1910 – has been sitting for sale @ $1.5M for months. Price just squeaked down by $35K. A 3684 sq/ft lot sitting at a T -it’s still overpriced by a quarter mil.

    When the price drops more realistically the bears will grunt and point at the sky.

  9. 1948 Templeton – 104 years old; tiny 2,500 sq/ft lot. Renoflated. Listed at almost $700K over last assessed. More bears ready to grunt and point.

  10. 2458 Triumph – bought 3 years ago for $814K – renoflated to $1.699M. Fantasy footage includes the head thumper attic. Good value – not. Grunt.

  11. Still, rates hovering below 2.5% for a 5-year fixed term mortgage has to account for something.

    The government invoking B20 guideline clarifications may also be causing some near-term impedances.

    Also, the market had to slow down and that necessarily means lower sales. It had to happen one way or another. Do not confuse catalyst with cause.

    Getting to -30% (detached prices 18 months ago) is going to suck. There is no good way to get there but for lower sales volumes, even if spread over the next 5 years. Way lower sales volumes. And if you think k the price point is lower still, I can’t imagine.

  12. Interesting times. I see quite a few houses like Arnie Carnegie points out, where they are priced 50% or more above last year’s assessed value. It goes to show that when you take all the SFH’s on the east side, and you kick out the ones on major streets, the tear downs, and the way overpriced, how much do you have left. Sales volume is falling, but real supply has yet to appear. It will take some time for this to play out.

    Bubbles burst on credit tightening. Nothing of the sort here, in fact if the Canadian economy continues it’s current disastrous performance outside of B.C., a quarter point rate cut is possible. If housing dives too quickly, the government still has a few other levers, cut down payment to zero, lengthen amortization from 25 years to 30 or even 40. With people living longer, 25 years is out of date anyways.

    Volume has taken a downturn – seasonally, year to year, month to month and in reaction to the tax. Supply is not yet increasing on the east side of Vancouver, and pricing is so far all over the place. Stay tuned.

    • Keith: Do you work for the real estate board? Serious question. If not, you could earn a tidy living doing crisis management for them.

      Unfortunately, while it is nicely crafted, your “nothing-to-see-here” write-up doesn’t withstand scrutiny.

      For one, sales began declining well in advance of the tax.

      For another, bubbles can (and have) burst without credit tightening. The Canadian RE disaster of the 90s, for example, occurred in a dropping-rate environment. To name but one instance. Fact is, bubbles burst for any number of reasons.

      Canadian credit is running on fumes. Sure, there may be another interest rate cut in the short term. But with prices so far above economic fundamentals, household debt at staggering levels, homeownership rates at record highs, and incomes stagnant, there’s only so much a cut can achieve. And as the U.S. raises rates this year and beyond, Canada is sure to follow, if history is any guide.

      • All I have said is it will take time stay tuned. Prices can temporarily rise even when volume initially falls. US 2008 took about 6 months to play out. This tax is a violation of our trade agreements and there are more surprises to come

      • Uhm…wasn’t there a lot of interest rate hikes before the crash? Once the crash started, cutting rates even dramatically might not reverse its course. So it could still be that the raising rates earlier started the turn and by the time the turn is evident and in full force, cutting rates no longer helped.

        Anyways, with current situation, RE mentality in this Vancouver is pretty much like religious cult among locals. All I can see this tax is making the locals go “BOOYA! I don’t have to compete with those dirty Chinese locust scums anymore! I’m going to stomp on those moron homeowners faces & twist their balls & make them pay! I’m going to get my Van West SFH at 75% off for $600K to $800K! Yah!”. Without sustained higher mortgage rates and/or mass unemployment, I don’t see much change to this market once this tax mess plays itself out. I bet you in 2017, there will be lots of services that specializes in helping foreigners avoid the tax, especially those $3M+ properties. The province is likely to turn a blind eye as long as they get their cut of $1B+ or whatever number they had in mind, and prices appear to be stable. After next election, who knows?

      • Serious answer. I work in retail.

    • We’ll have to see August’s data. One month is not enough to call a crash though. It’s probably nothing.

    • Hong Kong sales volume collapsed to half after the 15% tax was introduced. This lasted for about 6 monthes to a year before they kept on going up. It is expected that sales volume will collapse right after this.

  13. Some thoughts on the new tax. It is wrong on a number of levels.

    First, any increase to the cost of a good in a limited-supply market will help to raise its cost, as sellers exercise their pricing power. In this sense, the tax is counterproductive.

    Second, it’s not clear that foreign money is the driving force behind this bubble and, even if it were, it’s not clear that penalizing foreigners over locals is fair or appropriate.

    Third, how exactly was the tax conceived? Why 15%? Why not 5%, or 30%? Why now, and not sooner or later? Will the tax be repealed if the market declines to some acceptable level? How will we define that moment? If the market crashes, will the tax be replaced by a subsidy? This tinkering is totally arbitrary and political.

    Fourth, healthy markets and economies require stable rules. Changing the rules mid-game, with no notice or time to adjust, is going to hurt the city’s reputation and long-term growth.

    Fifth, if a tax was going to be introduced, it should have been introduced province-wide. The bubble extends well beyond Vancouver. And regardless, singling out one political jurisdiction is unfair and will lead to unintended consequences as capital flows elsewhere.

    HAVING SAID THAT, where was the corresponding outcry when the government engaged in all manner of interferences in the other direction? Home renovation credits, taxpayer-backed mortgage insurance, capital gains exemptions, property tax deferrals, loosening lending requirements, people raiding their RRSP for down payments… the list is long.

    • Just like McDonald’s big mac asses give advise on healthy eating.

    • Yep, i agree with those. They had hard numbers showing that 1 billion dollars from foreign investments flew into Vancouver Housing market in 5 weeks. So they extrapolated (which may not be accurate) that it would be 10 billion per year. This is inline with most estimates of “foreign” money. But what this doesn’t capture is the domestic foreign money, ie. domestic buyer foreign money. The 10 billion is just from the foreign foreign money, so foreign buyer and foreign money. The domestic market is far larger.

  14. Christine Duhaime ~1MDB

    No doubt that all real estate transactions would be completed through the use of shell companies.

  15. 2773 23RD AVE E – This sales strategy is surfacing periodically. Buy the scraper for $1.4M – plus you’re on the hook with the builder for the full monty – house + laneway @ $200/sq.ft = $676K. Don’t look for any change from $2.1M – likely to escalate well north of that.

    There’s a property just a stone’s throw from there owned by a former builder who made his living throwing up those ugly pastel peach Van Specs that weather so gracelessly. He bought the property about 8 years ago from a FSBO. Not only did he pay full ask, but the owner upped the price 3 times during negotiation. The house had been in the same hands for over a 100 years and wasn’t going cheap.

    The new owner set about building his swan song on this location that so entranced him with its sweeping view. Even with his professional building background the new house cost him three lesser properties to build. That’s the value of location with a view.

    So, by now, that location came up for sale once in over 110 years. Unless one of his kids flogs it when he croaks, don’t make plans to bid on it any time soon.

    Yet this property is considered part of “the market”. In the market it’s the poop that floats and keeps resurfacing. Anything good is quickly gone. The rest is mostly a soiled deck of shuffled deeds by renoflators, lipstick flippers, and spec builders.

  16. a 33% drop will bring us back to2015, and a 50% drop to 2014 !?

    2015Q4 – Vancouver sees strongest rise in luxury residential prices, recording price growth of 24.5% in 2015

    12-month change (2015 June – 2016 June)

    • Nope. To get back to 2015 levels for Metro Vancouver detached, it’s a 28% decline. To get back to 2014, it’s 38%. To get back to 2004 (which is where this market is going, in real terms), it’s 69%.

      According to the REBGV, if you trust their statistics.

      • hmm .. thanks for sharing the number.

      • Here is one example picked randomly. But I won’t hold my breadth for a 68% drop to return to 2005 level.
        The hordes of foreign buyers will gladly pay 15%, 30% or even 50% stamp duty surcharge and outbid the locals for that pot of gold (..oops, I mean “land”).. Btw those locals with down-payments and cash “borrowed” from siblings-parents-relatives abroad are surrogate homeowners, ’cause they are already asking how to remit the money after selling the properties without being hassled by CRA. Also,travelers flying out of Canada could carry any amount of cash without filing in form E677.

        3627 West 10th Avenue
        2005 $599k
        2016 $2.195m

  17. “Fitch Ratings-New York-22 August 2016: A new tax meant to slow home price growth in Vancouver will likely be effective in tamping down buyer activity, Fitch Ratings says. However, the recent decline in the number of sales suggests that the city’s market may have already begun to cool and is increasingly vulnerable to price declines if there is a rise in the unemployment rate.”

    “Fitch currently estimates home prices to be more than 20% overvalued nationally in Canada when compared to growth in long-term economic fundamentals, leaving markets increasingly exposed to downside risk. “
    http://tinyurl.com/h6bajrh

  18. at the end of the rainbow …

    http://tinyurl.com/h92a95n
    Dysfunction rules the roost in developed-world credit markets, contend Citigroup Inc. analysts.

  19. If indeed house prices are not dented by the new 15% levy, then we can expect more feet dragging until the election with lots of promises from all sides.

  20. 4866 Moss St – this frothy little 3,267 sq.ft. west facing crap property is for sale for the 7th time since 1991 – terrible feng shui (It sold yearly in ’01, ’02, ’03) – this time with a repellent new snout house. It has to be a snout house because there is no lane, ergo no garage or laneway house; and you have to leave your garbage bins prominently displayed in the front yard. Lovely.

    The footage of this excrescence is given as 2,420 sq.ft. whereas the maximum permissible .7 FSR is 2,287 – a case of creative calculation.

    The inglorious prairie dog basement windows offer views of the bottom of a fence and people’s feet. No wonder there are so many unhappy renters in Vancouver.

    This dismal deal is yours for $2.199M = $673/sq.ft. for pride of ownership. Don’t forget to add taxes and the cost of appliances.

  21. The winds they are a shiftin’…

    “The Multiple Listing Service data obtained by Postmedia News … suggests that the region’s previously ultrahot market for single-family houses has frozen solid. Some luxury homeowners have already slashed their asking prices in order to quickly escape dangerous market conditions.”

    “The detached market has just fallen off,” said realtor Steve Saretsky. “It’s crazy. It’s actually scary.”

    http://vancouversun.com/news/local-news/summer-slump-metro-vancouver-house-sales-plummet-after-offshore-tax-introduced

    • Yep, I don’t dispute the stats on volume. Though the average price stats are skewed because most of the transactions are on the lower end of the market. Caution on your enthusiasm though, you better hope you are right this time. Cause if a 15% tax can’t bring down this market that’s saying something about its staying power.

      • Who knows? Didn’t say it would or wouldn’t. Human stupidity is limitless, and the future is unknowable. What I have said is that, based on history and the fundamental economics of Vancouver, a significant correction in the near to medium term is more likely than not.

  22. Mingpao has a weird tale on this one.
    JinFang Li has sole ownership of the said property. In 2013 April 16, she applied to the City of Vancouver a permit to renovate the property to be occupied eventually by her and her daughter. An agreement is said to be in place between her and her estranged husband, Dong, who is to foot the renovation bills and to supervise the renovation project

    Then in 2014 June, a self-employed contractor Zao passing himself as the legal representative of the property owner, together with the estranged husband, both approached building professionals to obtained a City’s permit to demolish the existing house and to build a new two-storey detached family home in its place. Hence, the City, the architect, the builder and the demolition parties are all dragged in to this case. Meanwhile, the owner Li sojourned in China till September last year. She only found out in February this year of the City’s role in granting a permit without due diligence. The old house has been demolished, and the construction of a new house has barely begun. It sounds like a domestic vendetta gone wild

  23. Who’s more credible – the geriatric agent Eilers in West Van who has no listings, or young agent Saretsky who has one condo listing in Coquitlam?

    The first is happy to get a few listings before he goes into the care home. The latter grew up with a real estate mommy, who is still in the business, and is playing the media game – building his profile.

    It’s a trick question.

    • As usual, Arnie, you dismiss the messenger rather than address the message.

      If you think the Sun is cherry-picking quotes due to some anti-RE editorial bias, you’ve not been paying attention. The paper is clearly a shill for the industry. That’s what makes any negative reporting so significant.

      Quoting one realtor is no different than you posting about a single listing, is it?

      Ah, but forget the realtors. We have market statistics. How are they looking?

    • Steve Saretsky makes me laugh, an agent wannabe to be honest. But I think the stats do say that the market is cooling and volume significantly dropped after the tax. I talked to a few of my contacts in the industry, volume is dead in the detached side because it was mostly foreign money (anyone who thinks locals could actually afford a detached home has to be a bit delusional). Anything under 700K is still selling alive and well because foreigners don’t operate much in that segment.

      Though my contacts did tell me that they are working on work arounds for this issue. Demand will still be there eventually but they need to find a way for their clients to not pay this ridiculous tax.

      Poor people always hinder progress, do people really believe that Vancouver could have built all its mansions and glittering downtown skyline on locals incomes and just debt leverage? This city is built on foreign capital. Like many of my friends in tech, you don’t come to Vancouver to make money.

      • Yeah, I would say an 85% drop qualifies as “cooling”. Lol.

        So, you’re pinning your hopes on tax-evasion? Great. Sounds wise.

        As for “poor people always hinder progress”, what an asinine remark. Not surprising, though, given the source.

      • I am sorry, did I miss the 85% drop in price? Or was that volume? What happened to Hong Kong after the 15% tax went in? Just curious, did it affect volume more or price? What I would be interested in seeing is what do the list / sales ratio looks like. Cause you know, we were way ahead of what a normal market would look like.

        Correction on the tax evasion part, this isn’t tax evasion. By the letter of the law as long as the property is in the hands of a citizen or immigrant then it is tax exempt.

        As for the so called “asinine” remark, why, would you rather have the Vancouver 20 years ago? Sorry, I would much rather have the city the way it is today. Is it much more expensive? Absolutely. But we have much better restaurants, transit, shops, etc. None of this would be possible without foreign money.

  24. Aldus Huxtable

    Now all we need are court jesters in Robson Square.

  25. 915 23rd Ave E is the perfect property – perfectly consistent – repulsive inside and out: listed by Matt Scalena, an agent that supposedly has a legal background, but has no compunction about promoting an illegal house. He actually puts CAPS on the fact that there are FIVE suites generating $8,000/mo. The square footage is a lie as well.

    There’s consistency to the list price – exactly $800,000 over last assessed. Who would want to get involved with this cesspool of real estate? Not an honest person. Only slimeballs need apply. An utterly repulsive scenario. Criminally shameful.

  26. 4346 James St – a tarted up 86-year-old with the “open concept” couch in the kitchen aesthetic on a 2,805 mini lot with no laneway and a rare shared driveway. Hideous.

    Last sold in 2012 for $1.215M – now yours for the execrable price of $1.999M.

  27. 279 19th Ave E for sale – one of a curious pair of mutant twins on skinny bitch lots. 285 19th Ave E sold in Feb. 2013 for $1.365M.
    279 sold two months later for $1.259M – $106K less.
    Now yours for $2.149M just 3 and-a-half years later – an $890K bump.

  28. 5251 St Catherine – 80 year-old nothing East West house on a 3,234 sq/ft lot – no suite – not even a kitchen hood over the stove. Cleaned up and painted shiny white. Yours for $1.379M = $426.00 sq/ft land value.

  29. 3185 3rd Ave – builder buys a scraper in 2008 for $518K and beavers away. Sells the new spec house 9 months later during a drop in the market for just $848K to a clever bunny. No profit. Sad builder.
    4 years 4 months later bunny sells for $1.18M = $332K profit plus getting to live in a brand new property.
    Now listed at $1.988M – a tidy suspiciously auspicious vault of $808K in just 3 years 3 months. That’s $20.72K up every single month since September 2013.
    High production value on the vid of the property – a nothing generic slab-on-grade spec house.

  30. British Columbia offering debut Masala bonds at 6.68-6.73%
    http://tinyurl.com/zklcaus

  31. 3278 47th Ave – a brand new mutant of a house on a puny 2,127 sq/ft lot for $1.638M – plus taxes and appliances. No garage. A shocking deal. You’re pushing $800/square. Melissa Wu is scraping the barrel with this one. Footage of the house is a lie. Nothing new here.

  32. 1878 Nassau Drive – great views of a church parking lot and the endless traffic of Argyle Drive. Overpriced by over a million.

  33. #Meanwhile,BackInTokyo…

    • [LAT] – So that’s why Chinese buyers snapped up the troubled Malibu Golf Club site

      …”The 650-acre site in the Santa Monica Mountains was put in receivership after its previous owner, Malibu Associates, defaulted on a $47-million loan it had obtained from U.S. Bank to help pay for a massive makeover. Malibu Associates was founded in 2005 by Dick Fuld, the former head of Lehman Bros.

      “We had lots of offers, some with higher prices, but with lots of contingencies,” said Bill Hoffman, chief executive of Trigild, a San Diego property management company appointed by the court to handle the sale. “The Chinese company showed they had the cash and they could perform quickly.”

      Not much is known about Shinhan Golden Faith International Development, a Hong Kong-based holding company with shareholders in mainland China, South Korea, Taiwan and Thailand, according to the Panama Papers database.”….

      http://www.latimes.com/business/la-fi-china-malibu-golf-20160901-snap-story.html

  34. VREB has a message for bothe the bears and the bulls
    Metro Vancouver home sales in August dropped 26%
    whereas benchmark price for all residential properties was $933,100, a 31.4% jump compared to August 2015
    http://tinyurl.com/z67vzn4

  35. 7248 Knight St: “Build your dream house!” The agent had a big chuckle over this line.
    All the amenities: gas station; Rotten Ronnies; 7/11; 24 hr/day semi-trailers.
    It would be better to live near the chicken processing plant, or rendering plant.
    Yours for $1.1M.
    If you can handle living in this environment you belong in the Octagon.

  36. Trust the banksters, not.

    The banksters do heavy lifting? Of their pens to cut themselves cheques.

    They almost brought down the world economy in 2008.

    Maybe the new cyber currencies will help cut them out of the cash loop.

    Rulers of old sucked up to the church – still do to a lesser extent. The banksters have their ears now.

    The great R. Buckminster Fuller had bigger visions of the future; Jacque Fresco has carried that baton. Now, the founder of Zeitgeist, Peter Joseph carries on.

    Trust the banksters, not.

  37. “Benchmark” prices are obfuscating sharp declines.

    REBGV and Muir are like deer in the headlights.

    http://vancouversun.com/business/real-estate/mixed-messages-in-vancouver-real-estate

    (btw, can’t believe my eyes… finally, finally a semblance of balanced reporting from MSM).

  38. gist of an article appearing this weekend ~

    On 2017 July 01, OECD’s Common Reporting Standard (CRS) to come into effect in Canada.
    CRA will exchange automatically with 100 other countries on financial information of non-residents with investments, real assets and bank accounts in Canada.
    Thus, next year 2017 will be dubbed as the first “streaking” year for the global wealthy tax dodgers.

    Three categories of people most affected by this global tax rules:
    1) parents of international students who purchased real estate here, and some mothers living with their kids here as non-residents.
    2) tax dodgers who put their assets under the names of relatives. i.e.:
    A wealthy man’s father is the owner of a Canadian company in name; and since the latter is a Chinese citizen and a Canadian non-resident, the latter pays no tax to CRA. Under the new global tax rules (CRS), CRA will pass on all personal and financial information about him to the Chinese Revenue Agency.
    3) people holding assets in Canada and outside of China, as legal representatives or through offshore entities.

    ……………………………………………..
    Common Reporting Standard to come into effect in Canada on July 1, 2017
    http://tinyurl.com/z5ydabh

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