Leverage Turns Bad – ‘Vancouver homebuyers lost almost 50 per cent on their down payments in 1 year’ – Global News

“Once considered Canada’s hottest locale for real estate, home values in Vancouver took a beating over the course of a year, with the average home price dropping from over $1.1 million in February 2016 to $995,583 a year later. …
Zoocasa calculated the loss (or gain) of return by taking the year-over-year change in average home prices and then dividing it by the down payment buyers would have had to make in February 2016.
By this measure, Vancouverites lost 49 per cent of the return on their down payments.”

– excerpt and image from ‘Vancouver homebuyers lost almost 50 per cent on their down payments in 1 year’, Jesse Ferreras, Global News, 28 March 2017

Yeah, it’s called ‘leverage’ – bliss on the way up, a real bummer on the way down.
Along with other factors such as no capital taxes on primary residences, it’s why RE speculating has, superficially, seemed like such a no-brainer in Vancouver for the last 17 years.
But it is on the descent where the piper gets paid… the ‘virtuous’ cycle turns ‘vicious’.
It’s noteworthy that the downside of leverage is now getting headline news.
At the time of posting, the only comment on the Global site was from a realtor complaining that the article was too negative, and suggesting that it’d be preposterous to suggest that there was high risk in RE. If this market crashes the way it very well could, many are going to be surprised. If a 10% swoon costs you 50% of your ‘investment’, what will a 30% drop cost you? Or a 50% drop? Not pretty.
– vreaa

115 responses to “Leverage Turns Bad – ‘Vancouver homebuyers lost almost 50 per cent on their down payments in 1 year’ – Global News

  1. change in average price is due to change in “mix” – ie more condos, look at indivdual price changes to have realistic conclusion

  2. Very astute Tom.

    If anyone concludes that money has been lost in Real Estate, their conclusion is “unrealistic”.

    Everybody who knows anything knows that you can’t lose money in real estate. Not even when it is dropping in value.

  3. PS Look at all the little red arrows:


    Every red arrow is:

    -one property
    -currently for sale
    -currently losing value
    -in the owner’s opinion

    No averages, no mix, no algorithm, no skew, no spin, no REBGV.

    Just an owner who certified an asset to be worth a given amount, and then CORRECTED HIMSELF because it was not actually worth as much as he had claimed.

    What would a realtor call that? A Reverse Bidding War?

    “When it rains, you get wet.”
    -Neil McCauley

      • Ralph Cramdown

        I’m prepared to testify about scorecard irregularities if granted immunity.

      • rod_jonsson_pmd

        yes, all of this perhaps … depending on how much corp propaganda you’re willing to let stick … otoh have you taken a good look at what the competition been doing? … they still aren’t done falling apart … he’s actually pulling away … i’m open to it if/when something better presents … until then, ivanka 2024

  4. Here we go again, pull out that calculation of your favorite trajectory 65.49% and have a laugh at it. Tell the readers, vreaa, how have you missed it since 2008.

    • Actually, I’ve missed it from well before 2008.. yeah, I’ve been bearish that long. And my bearishness is all still on the record here for anyone to see.
      Yes, comical, and very wrong. We’ve established that before.

      That all said… Vancouver is now even more over-dependent on the economics of RE than it was a decade ago. Bears would argue that the inevitable has simply been delayed, and that the consequences of the unavoidable crash will now be even more profound. (Look at the article above… a possible mere 10% pullback and already we have pain and hand-wringing and denial and protestation.)

      Alternatively, of course, Vanc RE could continue up at 7%-15%+ p.a. … forever!

      • what pain? people need secured shelters for their families; do you think they care much about the fluctuation? have you seen any fire sales lately? or people are just scrambling to find a place in a super low inventory market? and don’t let the current numbers of detached homes fools you – try to take out all those block sales for rezoning, what have you left!
        you people have to stop distorting the current stage of the market – i wonder how many prospective buyers left out of the market because of false hope you people put in blogs like this.

      • Denial: the first stage of the grieving process.

      • sense of entitlement: big back yard with white fence for all !

      • Ralph Cramdown

        Fred’s right about feeling no pain, but for the wrong reasons. People change their minds — about the reasons for their past actions — to avoid pain and self-loathing. “Great investment, going up” becomes “my family’s home, for the long term.” Stock market amateurs do the same thing; “gonna pop tomorrow” becomes “I’m in it for the long term, I like it even more at $8 than I did at $12.” “I knew this car burned a lot of gas when I bought it, but it’s SOO worth it.” “Yeah, they do, but big booty is in these days.” “I didn’t vote for that clown, and I don’t know anyone who did.”

        It’s amazing, really.

  5. This infographic is a bucket of slop cheerfully regurgitated by a clueless reporter for the delectation of hungry bears. He should go back to writing about snowboarders in Whistler.

    The originator of this bucket is a slime-producing company that was resurrected by a hyper-aggressive Kevin O’Leary wannabe after it was shut down by original owner Rogers.

    A PR coordinator for this Toronto business, aka bs artist, calls the graph simplistic, though simple-minded would be more accurate. She should go back to posting about food.

    There are credible people you could quote, like Jurock, or Davidoff, or Somerville. Even Cohodes, at least, is entertaining – love his chickens. But this report is rubbish, even for gullible bears grasping at straws.

    • When you don’t like the argument, shoot the messenger.

      • The messenger should have the intelligence to know the rights and wrongs before spreading false info.

      • “False”.

        Please provide evidence.

      • go back and read all the charts and graphs you bears have made up; or your own calculation that Brain has shot it down many times. want more evidence: you.

      • “Charts and graphs” have shown actual historical data if I recall. Please specify which ones were false. You can’t? Right, didn’t think so.

      • i would rather look at the dogs running freely around trout lake. it’s time for your to hand over the rent cheque.

      • If you can’t take the heat, get out of the kitchen.

      • why would i want to take the heat in the kitchen, while i can sit at the table, being served with good foods/drinks? all i have to do is to enjoy the foods, the drink, my company; i always leave a handsome tip if i am served well. anything else?

  6. Speaking of hungry bears that like to eat slop …

  7. 42-6511 Chambord Place: Has a great porn picture above the fireplace.

  8. 117 E 28th: one-of-a-kind location with spectacular views of dumpsters. Endless entertainment 7 days a week from your neighbour: Joe’s Bottle and Paint Depot. Save time taking back your empties. All this on an easy to care for 3,422sq/ft lot. Yours for the piddling price of $2.89M.

  9. Ralph Cramdown

    OK Canada, we get it. Not all Canadian homeowners want to sell out to wealthy ‘offshore’ investors. And frankly, with that new 15% tax, not all ‘offshore’ investors want to buy your whole house.

    So we just bought your water heaters and your furnaces. Please continue sending your monthly cheques c/o the Foreign Affairs Department in Ottawa. And don’t forget the GST+PST!

    Nyuk nyuk nyuk

  10. If confirmation biases were airplanes, this blog would be an airport.

    Settle down everyone. Compose yourselves.

    Place your bets and show some deference to the other gamblers.

    All of us have taken massive risks…because the risk of missing out is a risk too.

    While we wait for the next round to play out, let’s agree on the rules.

    Rule 1. It’s your money
    Rule 2. Do what you want with it
    Rule 3. If you achieve your goals, you win

    Does anyone disagree?

    My goal, for me, is to not expose my personal net worth and my marriage to simultaneous and permanent devastation by making a heavily leveraged long play in an asset class that *I* consider to have an extremely uncertain future.

    I also do not make million-dollar leveraged bets on pork belly futures or the superbowl. I just don’t know enough about any of these subjects to see them as worth the risk of all that I have and most of what I will ever have.

    I am certainly taking a risk by not taking that risk, as I have acknowledged above. But I judge the risk that I am taking to be the lesser of the two risks by an order of magnitude.

    I also judge it to be the only risk that is reasonable and responsible for me to indulge in, given my circumstances.

    I’d rather have enough money to live and still be married.

    If that infuriates you, see Rules 1-3.

  11. Fascinating. Whenever you hear the word “tranche”, protect your nuts, and your wallet. The banksters are out for blood.

  12. 535 11th Ave E: Turkey. Bought in 2012 for $965K. Scraped and duplexed. Half of this faux heritage now listed at $2.15M = $732K over last assessed.

  13. Honest question guys: if Vancouver does do a “housing reset”, is that going to mean lower house values for incumbent properties? I admit I’m not seeing it, really.

  14. There’s a big difference between being wrong for the right reasons (bears) and right for the wrong reasons (bulls).

    • You mean wanting a good SFH in a desirable neighborhood without having to work hard ever, or having any luck?

    • my oh my, no wonder you are where you are. If you are wrong, you are just wrong! i hope you just finished grade 12, and not yet a parent.

    • As Vancouver’s RE market crumbles, bulls losing their minds.

      I am waiting for a cogent bull case following recent market developments. Please, do share.

    • I thought this blog was dead. Wow.. come back from vacation to find a flourishing war just the way I like. And off of the top you have mr. Ninja running his mouth off. Tell me Ninja, do markets never correct? The right question is.. do bulls even need to explain what has gone on lately cause guess what Mr. I am right.. I still can’t find a detached home on the west side on a decent lot for under 2 million. So your correction has done shit all for the locals. Btw, if that does happen, that hasn’t even signaled a crash, that would signal that we are now only pricing out oh I don’t know… 95% of the market rather than 100%. To signal a crash, a westside detached would be at 1 million. Btw, here is one other thing, you are almost a year and half into your prediction, so 6 month to 18 monthes to go before the final verdict my friend. You better hope I can find that detached house for 1 million 18 monthes from now or else your so called logic is kind of you know.. useless.

      • Interesting shift of narrative, Brian. Now the definition of “crash” is that you, personally, need to be able to afford a house on the west side. Never mind actual statistics, this is all about your individual financial situation. If it’s weak, as I expect it is, then the market hasn’t crashed because you are still priced out. It’s “heads I win, tails you lose”. Love it.

        And we’ve gone from “Vancouver is undervalued on a global basis” (due to Chinese wealth, geographic constraints, etc.) to “well, of course markets correct”. You can’t make this stuff up! As the downturn deepens, I can’t wait to hear what rationalizations come next.

      • Ninja, do you really want me to point out a couple of obvious points while being jetlagged?

        1. I am not just any buyer, I am a pretty typical buyer of westside detached. Like I am not even looking at any particular neighbourhoods, about 70% of the sub areas work for me. So if this correction ain’t doing much for me what does that say about this correction of yours? Also.. I’d like to see any benchmark statistics to say this is a crash. Because there is not a person, not one that I have talked to on the ground who is actually buying who sees this as anything helpful to them. The only thing they see is that we are not longer going straight line up. God knows what will happen next.

        2. Refresh memory time. Our bet was simple, that detached prices will be in your case 50 to 75 percent lower and my case higher. That was november of 2015. I can pull out a ton of examples of properties in most areas where prices are higher than that point. So.. no, you are still wrong with regards of that. And your time frame expires november of next year which was the upper bound of your prediction.

        Btw, if your so called crash still can’t find me a detached on the west side for say under 1 million what type of crash is it? This isn’t like I am looking in kerrisdale or pg or dunbar, this is the whole west side which is one half of vancouver proper!

    • If I have a choice being being right and being lucky, I will take lucky every time.

      Since I wasn’t lucky on this go-around, (i.e. being a bull who thinks that it’s sustainable for a house to cost 100 years’ income, and bets his family’s money accordingly,) I will have to settle for right.

      • Sure, in hindsight, who wouldn’t take lucky? But when it comes to appraising the future, luck doesn’t cut it. One needs a framework grounded in study and logic.

      • I actually hope you are right… I don’t know how old you are… but if you are right say 20 years from now… what difference does it make? Take vreaa… even if vreaa is right…. it’s useless because prices have to hit 2003 for it to actually make a difference. Vreaa could have bought in 08 and to even reach that point we would need a massive crash… But of course like Ninja said, you could always.. umm… leave this city like he did… there are other great cities around. I for one think San Fran is a great place. Have you considered there? I heard it is significantly cheaper than here… oh.. .wait…

  15. Got that.

    It goes like this:

    All asset classes since the beginning of time have reverted to fundamental value.

    Fundamentals of residential RE include revenue potential and the ability of locals to purchase it.

    When residential RE costs 100 local incomes, it has become detached from fundamentals.

    It is only reasonable to expect one outcome.

    Bulls disagree with this analysis but I have never seen one present a cohesive argument.

    They want it to be true but they can never explain how it could possibly be true.

    • Simple question number 1, according to stats can, vancouver proper has 48000 detached properties and even if we create more we are basically subdividing existing properties. Vancouver’s current population is 600K, if said population goes to 800K with no increase to the number of detached properties do you expect said price to go up or down?

      Question 2. Vancouver has 600K people, over the course of 20 years, said 600K people now comprise of a much higher percentage of millionaires based on foreign incomes not tracked by local government, do you expect said detached properties to go up or down?

      Simple question number 3, most major chinese cities (Shanghai, beijing, hongkong) feature ratios much worse than Vancouver’s. Don’t believe me, ask anyone who has tried to buy a place in Shanghai or Beijing or Hong Kong (where they recently sold a property at 4500 CAD per sq ft ), so how did they get there?

      I love your use of the word local. Cause god knows that we have priced out about 99% of occupations in Vancouver from buying yet the prices still can’t come down without a foreign buyer’s tax. It’s all local incomes right?

  16. I love this title. So misleading. So if one month my portfolio trades mostly penny stocks vs blue chip stocks my average price per share would be the same? Similarly if one month attached made up most of the volume and the other month detached made up most of the volume what would you expect to see from the average price? Is there a reason why we use benchmark pricing rather than average?

    • We use benchmark pricing because every time a realtor, mortgage broker, banker, or homeowner looks at the average price, shit runs down his leg.

      • Really? I am a homeowner and I don’t see any feces running down my leg. =) Funny enough, I am both a owner and a buyer so I straddle the fence both ways. I can tell you from me as a buyer that this hasn’t really helped me that much, it just hasn’t made my situation worse than before. But you know, what do I know, I am only a typical west side detached buyer.

  17. We also use the HPI so-called “benchmark” because SAME PROPERTY stats are a complete mindfuck to everyone who is personally or professionally invested in the myth of “real estate can never be overpriced.”

    Isn’t it weird how the benchmark can keep going up while SAME PROPERTY prices are falling off a cliff.


    That’s a hell of a lot of red arrows (and evaporating paper wealth) for a market that’s not correcting.

  18. “Realtycheck” is garbage that was set up a few months ago by a Jesus freak theology student hoping to make money setting up websites – no doubt just as full of crap as this one. He’s sticking his stupid little up and down arrows based on list prices – a meaningless endeavour. Check assessed values instead.

    I’ve never prognosticated and don’t particularly care about benchmark prices; and average prices are too skewed to be taken seriously. I don’t even put much store in generalizations by neighbourhood. I look at property house by house: topography, orientation, proximity, rezoning upside …

    And I don’t look at real estate as an “asset class” unless it’s in a REIT. My take on where the Van market is going is that, even if you took out the Chinese contribution entirely, the market would continue to rise just from the Punjabi sector, not to mention the Vietnamese, Filipino, Russians. I spent a few months in India. Try and buy property there.

    My interest is only in single detached properties. If I look at multi-units, it’s pretty much to say WTF.

    If you want a deal on property, check out Manitoba.

    Immigrants to Canada are part of the MTV generation – Montreal, Toronto, Vancouver. Of those, Vancouver is preferred. The supply of detatched houses is diminishing. Demand is increasing. Ergo.

    • I do a similar assessment to yours but I use it on prime areas instead. But that is highly subjective because we have established that you and mine standards are very different.

    • Why would list price not be indicative of market direction.

      What can you possibly mean by that.

      Thousands of people a month listing and then dropping their prices by 5, 10, 15+ %. Letting their properties languish without interest, dropping the price, then watching them languish some more before dropping the price again.

      This is the worst possible behavior for a seller as it shows that you are an amateur and/or have admitted to overstating the value of your asset.

      It’s the worst thing possible for your realtor because it takes him more time and work to get paid.

      Nobody wants to be in the position of dropping their price incrementally and yet my realty check is showing exactly that.

      You think that’s not indicative of market direction?

      • 2013 Honda Accord dealer serviced no accidents $18795

        Look around the room. If you can’t tell who the sucker is, it’s you.

      • Err.. isn’t it kind of obvious that sold data is more important than list data?

      • Sold price and sale to list ratio are all that matter to me. List price means nothing, it’s just numbers. Some sellers try to price high hoping to bait a buyer, or price low to attract multiple offers, what do you make a market direction out of that?

    • Annie doesn’t understand that the price of any asset already reflects estimations of future supply and demand. That’s what a price is: the discounted value of future cash flows an asset will generate.

      His financial innocence aside, Arnie’s “MTV generation” is a wonderful candidate for Vreaa’s bubble jargon compendium. As if those three cities have emerged out of nowhere as novel additions to the Canadian map.

  19. Most sellers are guided by a realtor. Realtors advise you on a list price that will get it sold in a timely manner and possibly trigger a bidding war.

    Overpricing, getting no interest, then slowly incrementing down the price month after month is an admission of failure by realtor and seller.

    It also means less income to the realtor because it takes more time and work to sell a given property and the delay of his payday. He is taking a cut in pay and looking like an idiot to his client and his peers.

    Seeing this happen to *most* properties on the market indicates that *most* realtors are being surprised by how little buyers are willing to pay. And/or by how few buyers are available.

    If a realtor advised me on a price, we sat by the telephone for 30 days without receiving any interest, then the realtor advised me to drop the price 10% and try again, I would call them a rank amateur and tell them to get off my goddam land before I complained to their “professional” association.

    Making sure that never happens is basically their main job, and here we are watching it happen to thousands of properties.

    That, my friend, is a bellwether.

    • Ok, so take this scenario. You have five agents bidding for a property, one says he can get about 10% higher than the others. Are you likely to use him? Smart money says you have to evaluate what he says properly before deciding but we all know that home owners are not all geniuses. So the guy who says he can get the most gets the listing. Now can he actually get that price? Highly unlikely but it will sit on the market. As for why this didn’t happen last year, simple, all properties were deliberately underpriced to create bidding wars. Bidding wars still happen but not to the ferociousness of before, so that strategy is less used now. Hence why you see your map of red.

      What is a better system you ask. Just do this, compare the sale price to the assessed price. Assessment prices are using July 2016 prices which pretty much everyone agrees was the top. So if a place sells 10% below then it has fallen 10% if it sells above then it has gone above the peak. That’s the system I use.

  20. And anyway that website catalogs attempts to sell over the years.

    If thousands of properties are being listed for progressively less — month after month and year after year — you need to have a pretty big personal Reality Distortion Field to consider that entire dataset irrelevant.

  21. Funny how aggregate stats were God’s word on the way up, and now that prices are crumbling, suddenly it’s all house by house.

    • Crumbling??? Are you buying? Try a one or two bedroom unit. While you’re at it, try to get a mortgage approval these days. Bears are just so ignorance, yet so arrogant at best.

      • wharrgarbl

        Aah yes.

        Mortgage approvals are more difficult to come by therefore prices will go up!

        Permabull logic at its’ finest.

      • “Mortgage approvals are more difficult to come by therefore prices will go up!”

        oh boy, another ignorance assumption from the bear. why don’t you try to apply for a mortgage and see how much paperwork the bank demands from you these days.

    • Really? was that so? cause Arnie loves his single house analysis and I focus on specific areas (matter of fact, you accused me of being too specific and not broad enough). So which bulls were you talking about then?

  22. 106 350 5th Ave E: renoflipping a turd. Bought just over 2 months ago for $391K – listed at $499K. Last assessed at $306K. This tubular brown is staged – rare at this price level. Watch out for leaky condo syndrome. And no, you don’t get to keep the furniture. A dozen years ago you could buy here for $60-70K. With BCIT/Emily Carr/St Pauls going in, expect this area to become a renovating renoflipping beaver sanctuary.

  23. 405 1128 Quebec: bought 8 years ago for $535K – assessed at $934K. Maintenance fee: $691/mo. Offered at $1.385M.

    • [Guardian] – Is Vancouver lonelier than most cities or just better about addressing it?

      …”It has long been rated as one of the world’s most liveable cities. But beyond its dazzling skyline and ocean views, Vancouver has for years struggled with an issue that’s rarely featured in any global ranking: loneliness…

      …About 25% of those polled said they felt lonely at times, while one in three said they found it hard to make new friends in the city. One man confided that since moving to Vancouver seven years ago for work, he had never once been asked to go out for a beer.”…


    • [NYT] – My Vancouver: An Ever-Unfolding Story – For the author, this gleaming, complex city in British Columbia is “a rolling, improvisatory work in progress.”

      …”It’s noteworthy that on only two occasions has the city found itself on the brink of a sports championship: Game 7 of the Stanley Cup playoffs in both cases, in 1994 against the New York Rangers and in 2011 against the Boston Bruins. Both times, on losing, Vancouver descended into manic violence with stores looted and cars burned. There’s a troublingly adolescent quality to these disturbances, which I theorize are less likely to occur in cities that are soberly aware of their own capacity for self-harm. In Vancouver — where cyclists wear helmets and nobody carries a concealed weapon — I’ve often wondered if in our youthfulness we also lack the maturity to see our own hypocrisies. A city smugly in the downward facing dog.

      As if to illustrate this point, when asked about working with an authoritarian regime on returning from a trip to China, our mayor managed only this glib reply: “You can question how worthwhile democracy is in a lot of countries right now.”

      I don’t know what he meant. Maybe the suggestion is that only with the reach and power of the government that threatened to execute his girlfriend’s mother could a politician fix the dire problems of Vancouver’s Downtown Eastside, which has the lowest per capita income in North America, where an estimated half of the resident population is thought to be drug users, where homelessness and addiction can be seen on every corner, in every alley.

      Or perhaps what’s being alluded to is that more political authority is required to solve Vancouver’s other vexing problem: that real estate is inflating far past the ability of typical local incomes to support ownership, that we are pricing out our artists and our young people. Interesting, on this score, that a good part of the money flowing into our city and bubbling our real estate prices is coming from people trying to escape countries where leaders have exactly that kind of power.”…

      • Re Gregor Robertson’s comment: The elite don’t want democracy, and with good reason. In a democratic society, the many will vote to tax the income and assets of the few. When the income and wealth inequality is as great as it is in Vancouver and in B.C., there’s a lot to lose.

        You may have noticed the strategy of the right wing politicians; make people feel disempowered like their vote doesn’t count, and pit working people against each other – union vs non union, urban vs rural, environmentalist vs people working in the resource sector. Voter turnout is dismal and working people are divided. Protect what you have, and protect your opportunity to accumulate even more.

      • Thanks (as always) to ‘The Auteur’ — the NYT article is an interesting read; amongst other things, it expresses the confusion that many feel about Vancouver… the city is changing and elusive. A bit like the Trump presidency.. there is so much to say but where to start?
        And the comments are worth the read — much of it sounds like the debate at one or another of our city’s RE blogs… interesting to see that in the NYT.

      • rod_jonsson_pmd

        money fleeing a totalitarian regime a big miss … lending standards don’t exist in the western sense … these are funds obtained from gaming (or defrauding) the largest credit expansion in history … it is no less legitimate than what wall street and dc do … but let’s not mis-characterize the nature and inclinations of the escapees … there are many signals credit high tide has passed … brexit might be the 1st … trump the most prominent so far … sovereign yields all spiking … -ve rate insanity probably marked the top

  24. Thumbs up to Auteur – thanks for sharing.

    The author shouldn’t have written that Vancouver descended into manic violence when their sports teams lost. A small number of rioting drunk yobbos are not representative of this city. The redoubtable Froogle had interesting comments about the rioters. The bit on addicts on every corner of the DTES was also a bit overly dramatic.

    Sales to active listings ratio is up to 47% – a big bump over February. There’s downward pressure on prices at a 12% ratio. Doesn’t look like that’s going to happen.

    Listings are down, sales are down, land assemblies are proliferating. Detached houses are disappearing.

    • Vancouver’s riots involved hundreds if not thousands of residents. They were an utter disgrace. And the DTES? An unmitigated human disaster. Give us a break.

      • Well, many were waiting for it for like 20 years? Their shot at glory & infamy. There were whispers of a riot before game 7 even started, and a lot of people were just itching at the opportunity. And yet, the riot didn’t really amount to much. Yeah, there is property damage and such, but really, compared to other riots around the world, it was rank amateur – both the protestors and the police.

      • DTES is a bottomless barrel thank to the work of mayor moonbeam. Since you are an astute renter and super smart in armchair economic subjects, you should run for office and make a difference in the community.
        Trout lake is so beautiful and peaceful in the early morning hours.

      • “Compared to other riots around the world it was rank amateur”

        What a moronic statement.

        “Amateur”? Is rioting a professional occupation with various levels of skill and ability?

        Also, protests around the world are often over legitimate political or human rights grievances. Vancouver’s riot was over a lost hockey game.

      • NoteToIllustriousEd: “My bad.” Still, how often is one afforded the opportunity to put a headline like “Cow Vigilantes” to good use?…

    • “professional occupation with various levels of skill and ability” why don’t you ask the 4/20 and the occupy 99% crowd and see how they respond.

    • We are an interesting city. I do agree with most bears that we do take ourselves slightly too seriously on the world stage. In reality, our status isn’t that high on the world stage with the exception of one very important market, Asia. To just about everyone else we are like Seattle or Portland. But…. we have 104 direct flights to China. And no one can claim that record from us.

      We fly direct to just about every first line chinese city, Beijing, Shanghai, Xiamen, Hong Kong, Guangzhou, Shenyang, Nanjing, ZhengZhou(I dont’ even know where that is), Hangzhou, Chengdu, Xian, Qingdao (what is this city doing on this list?). No major western city, not New York, not San Fran, not Chicago, not Paris, London, Berlin, etc. No one can claim this exhaustive list of direct transportation to China like we can. Hell, we are even looking at a direct line to Tianjin which is only one hour from Beijing (why do you need a direct flight there?) and apparently Dalian is coming online at some point in the future.

      Begs the question where we hitched our economic wagon to eh? Is it any wonder why all of a sudden we are being more connected than ever to China now that we have little potato (remember big potato was the guy who opened us up to China in the first place) basically approving every economic tie we can get our hands on with that one country. He is in power for another what, four years? Watch as we are drawn ever closer to the red dragon.

  25. @ Brian

    104 flights by July 25. That’s a good observation – not conjecture. According to BIV, YVR is expecting a 48% increase in flights to China within 18 months.

    Bears can wag their tails all they want at “experts from afar” but, barring a major earthquake, if you want to own property here, you better have deep pockets.

  26. 2135 22nd Ave W: last assessed at $5.371M – listed at $6.988M. Right in the middle of the area formerly known as the Asthma Flats. Living big, on a bog.

  27. 1750 57th Ave W: on a busy street bordering a bog and just blocks away from 7984 Beechwood, where the aquifer was pierced a year ago and has been spilling millions of gallons ever since. Asking $4.998M – at least a million too much.

  28. Sorry, that’s 7084 Beechwood – place should be a tourist attraction – big pipes everywhere. Everyone in this area is shitting bricks; wishing they lived somewhere else.

  29. Flights to China = prices going up forever!

    Thanks for the investment tip, guys.

    • i know it sucked right! the more people come here, more demand. it does not take an arm-chair economic degree to figure it out. you might need to order more cheques as you will be writing them to your landlord for a long long time. dont you just hate people with lot of money!
      oppss, traffic by-law just arrived. gotta move my rv.

    • You are welcome and when we have direct flights to every provincial city you know which direction the prices will go. It’s great to have a PM who is basically bought by the chinese government eh?

      • Trudeau is a dimwit who should have remained a part-time drama teacher.

        Last I checked we also had a lot of flights to the U.S. — a vastly richer country than China, and with far deeper geographic, economic, and cultural ties to Canada. Yet, how many Americans are rushing to buy Vancouver RE? A handful, maybe? They’re irrelevant to the market landscape.

        Let me guess, you’ll respond by saying that the Chinese are eager to export their capital and the American’s aren’t. Well, how sustainable is an economy from which capital is fleeing? Not very, I imagine. Where does that leave your investment “thesis”? Never mind the fact that Vancouver RE is not driven solely or even significantly by the Chinese, but by local buyers whose incomes are low and stagnant, and whose borrowing capacity is tapped out.

      • Trudeau is a dimwit, agreed.

        So you say we have a lot of direct flights to the US… hmm.. I must be mistaken, but did we have an explosion of americans in our demographics over the last thirty years. Cause I must have missed the part where a whack load of rich US people immigrated here. I don’t believe that we are projected to have 1.2 million americans in Vancouver in 2031. Of course, I could stand to be corrected. You know, given that we are so culturally similar, we should see a ton of american people here in the future right? Stats Can are way out to lunch with their projections…

        Now onto your second point… so you say we are not significantly driven by chinese money right? Interesting… I guess that’s why all of a sudden Chinese agents are doing a lot more deals in real estate in the last ten years… so much so that the three fastest growing brokerages are all chinese. In fact, most of the agents in these brokerages can barely speak English. It must be the locals, they just love to learn a second language from their agents. That’s why these assholes who barely speak a word of english is able to displace a lot of local agents in the last few years.

        Also, given that banks use the 5:1 lending ratio for incomes. And given that the average property in Vancouver is what 900K now with the average family income of 70K. Napkin math tells me the down payment should be what… 900K – 70K * 5 or about 550K. So say if we get the richer variety so incomes of 100K, what you are telling me is that we have a lot of locals with downpayments of 300 to 400K just sitting around… Yeah… I know.. it makes a ton of sense to me too…

      • You don’t get how bubbles work. People who would otherwise never borrow so much money do so on the expectation of higher prices.

      • Look, I am not stupid enough to think that none of it is happening here. After all, attached prices are also rising. The difference between you and I is who is the major driver and who is the minor driver.

        Believe me when I say this. I have personal experience dealing with these banks, they are tight to their 5:1 ratios. It’s not like I can borrow more, they won’t let me! Like I am talking about big five banks. So it’s not a matter of me borrowing more than what I can afford, it’s a matter of banks really cracking down on how much you can borrow. Rule of thumb, minimum 20% down 5:1 ratio on income. So with those numbers, a person making 250K with 1 million down cannot buy more than 2.25 mil. If the property has a suite then maybe we are looking at 2.4 million. Now, we would both agree that a local who can make those numbers work is pretty wealthy here. But as I have demonstrated, that only scratches the surface of a detached westside place. So… I can’t see how the numbers reflect that locals can actually leverage so much to bring us to where we are today. The banks simply don’t allow this much leverage in practice. You are looking at some pretty large down payments being put down here. I just can’t see how many locals have that type of down payment you would need.

      • Big 5 banks not the only source of funds. Smaller lenders, ‘bank of mom’, lines of credit, unreported rental income, etc. all adding fuel to the fire.

      • True, however, most data analysis shows that the big five dominate the mortgage lending market. So yes while there may be some smaller lenders in the market but they are the minority. The bank of mom and dad is a well discussed topic except that their helocs are also income tested as well. Its essentially taking a mortgage on your own house. In reality, what has been happening is a lot of down payment help from sellers who sold in the market to their kids, but that money isn’t leverage. In reality, the leverage used in the vancouver market is still tied to income which you yourself said is low, so again, if that is the case, how can you even get here without an external source of funds. If indeed unreported income from rent is supporting the market then that is actually a fundamentally positive development because there is income to support the prices, but I doubt that is what is happening because there is no way rents can support these payments. Most local housing experts now understand the foreign fund (not foreign buyer) phenomenon and accept it as a major driving factor, this wasn’t so a few years ago.

      • Btw, I should also add, while the smaller lenders may lend a bit more than the big banks but you are not talking about significantly more money, I think you might be in the range of say 20 to 30% but that hardly puts a dent. That’s like saying a 70K couple used to qualify for 350K now they qualify for 450K. Big difference in today’s market.

  30. 3186 10th Ave W: clueless builders. Clearly men who have never cooked a meal, or done a single load of laundry. The brand new laundry area is depressing. Doing laundry sucks as it is, but to do it in this windowless cubicle is penance.

    Builders trying to be flash; manifesting as stupid.

  31. 101 977 8th Ave W: a shocker – a heritage-look 2bdr strata with a stiff $900/mo. maintenance fee. Bought for the insane price of $1.4M 9 years ago – listed for the mind-blowing price of almost $3M.

    • You can tell Arnie is a transplant to Vancouver because he writes “8th Avenue West” instead of the locally-used, “West 8th Avenue”. Transplants are desperate to rationalize their commitment to their deteriorating adopted city, and to prove their local chops. Hence Arnie’s bullishness and faux market reporting.

  32. Back to the fabulous East Side – 3369 23 Ave E – a blech Van Spec built in 2011. The lot with scraper went for $608K. Just listed by a no name agent – the only listing in his hot little hands – for $2.638M. That’s a West Side price – $772K over last asessed.

    Curious interior – busy busy baroque – ornate window treatments; repellent kitchen and laundry. There’s a little piecework sewing factory set-up – guessing Viet owners.

    A monstrous ask – but pickings are so slim. Once you strip away the land assemblies, scrapers, and busy streets – it’s a take it or leave it scenario. Many will want this ugly beast, but that price … omg.

    • [ColonialTimes] – Number of Greater Victoria real estate agents nearly matches listings

      …” The number of listings in Greater Victoria’s hot property market has dropped to the point where there is almost one real estate agent for every listing.

      At the end of March, there were 1,556 active listings and 1,353 licensed agents, according to the Victoria Real Estate Board. Victoria is in the midst of a sellers’ market where prices are climbing and listings numbers are shrinking. There are plenty of buyers, but not enough homes for sale.

      A decade ago, there were 3,079 listings in March, nearly double what we see today. Real estate agent numbers fluctuate but were close to today’s figure, at 1,310 in 2007.

      Other numbers have changed.

      Last month, the benchmark price, which tracks the price of a typical home in the area, for a single-family home in the core was $790,100.

      A decade ago, it was $542,504.

      There were 929 properties sold through the Victoria Real Estate Board last month, a drop of 17.1 per cent from 1,121 sales in the same month last year.

      “We are working really hard for the fewer transactions that are out there,” said Real Estate Board president Ara Balabanian. “It is still a very active market. There have been times when it has been far less active than this.”

      The low number of listings “implies that there are a lot of realtors who do not have a listing on the go at this time,” he said.”…


      • Add to that the Pareto Principle and you’ve got a posse of dildoes with no listings. And no prospect of getting any beyond conning granny out of her house. That’s a good name for a brokerage: Posse of Dildoes.

        The bimbo that “sold” my neighbour’s house hasn’t had another listing in over two years. She got lucky that he handed her the listing because she was a “friend”. She screwed him by sliding in a one year contract in the hottest market ever. Then she promptly flaked off to Cancun. When she came back all tanned she set to beating him down on price. A blond-hair-flipping Mercedes-driving con.

      • Not only is Arnie an antisemite, he displays a regressive attitude toward women. Lovely.

  33. Anyone know why Ninja is so demented?

  34. I haven’t checked the market in 5 years as I was doing more school and working. Holy crap it’s the craziest bubble I’ve ever seen and it’s not just on detached housing the renting market is completely and utterly retarded.

    Got to be thankful my family owns a couple of houses in the area because otherwise my calculation is that to be even semi-comfortable you have to be making $75k + /year and as a young couple $120k + and that’s a handful of people I know around my age in that category. I have a friend whose an engineer with his own business making north of $350k/year and he could barely afford a 3 bedroom on a smallish parcel of land.

    Not only that the economy for even mid-level jobs is shrinking and companies are paying less than they were 5 years ago. I laughed when I heard the NDP leader say he would get renters back $400/year… that’s barely a blip. Semi-decent living space seems to be $1400+/month now which is insane. When I was last renting a few years back I had 700 sqf for $750/month. That same space now is $1400/month and wages have shrunk. That’s insane and completely unsustainable. The exodus of 30 somethings will start to be massive once they realize they have to put 60%+ of their money (on average) into housing. The brain drain will be crazy.

    • [TheHill] – Does mass immigration drive up home prices: One study says ‘absolutely’

      …”Looking back at the last three decades, University of British Columbia professor David Ley states that the correlation between immigration and home prices is very tight and not only in Vancouver but in Canada’s other major cities as well—Around three-quarters of all Canada’s 300,000 annual immigrant-intake goes to just three of the country’s metropolitan areas: Toronto, Montreal, and Vancouver. In his 2010 book on the subject, Millionaire Migrants, Professor Ley found that the connection was “unusually decisive” with a “positive correlation coefficient of 0.94 between Vancouver house prices and net international migration.”

      …As he explains in his book, in their “desire to soothe frictions over immigration”, Vancouver’s real estate industry clandestinely created an economic think-tank, the Laurier Institute, to “study” the immigration-impacts on housing. Falsely billed as “independent”, the think-tank published a series of reports which “found” that it wasn’t foreigners, but internal Canadian migrants, who were to blame for pushing up prices.

      That conclusion, says Ley, was bogus and even among real estate brokers, he writes, the reports elicited laughter.

      Looking back at the data, Ley found that the made-in-Canada argument was “conclusively denied by the wage-home price mismatch during this period.”

      “Despite dramatically rising house prices”, he writes, “real median family income in metropolitan Vancouver actually fell by 3 percent between 1990 and 2000.”…


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