“Some buyers acquire multiple homes, one to live in and others for investment. They made their money in a variety of businesses, including mining, stainless steel manufacturing and real estate. About 10 percent of them speak English.”

Anecdote extracted from ‘Chinese Spreading Wealth Make Vancouver Homes Pricier Than NYC’, by Hui-yong Yu and Christopher Donville, 17 May 2011, at bloomberg.com : “Winnie Chung, a Royal Pacific agent represented buyers or sellers in C$285 million of home sales in 2009 and 2010 combined. Chung employs eight full-time assistants and travels to China twice a year to meet potential clients. Some buyers acquire multiple homes, one to live in and others for investment, said Chung, the broker. Her clients made their money in a variety of businesses, she said, including mining, stainless steel manufacturing and real estate. About 10 percent of them speak English, she said.”

Westside Realtor – “Our office has done 50 sales this year, which is pretty incredible. Half of those sales are from mainland China.”

Anecdote extracted from ‘Chinese Spreading Wealth Make Vancouver Homes Pricier Than NYC’, by Hui-yong Yu and Christopher Donville, 17 May 2011, at bloomberg.com : “Our office has done 50 sales this year, which is pretty incredible,” said Vancouver realtor Tom Gradecak at his office in Point Grey, where he has one colleague who speaks Mandarin and Cantonese and is hiring a second. “Half of those sales are from mainland China.” One Chinese buyer paid C$1.7 million in March for a five- bedroom, three-bath house that the previous owners had completely renovated in 2003, C$150,000 more than the asking price, said Gradecak. The buyer plans to tear it down and build anew. “There’s more value in the land,” he said. “We’re seeing a lot of empty nesters cashing out.”

“I hope the government can do something to control the price so younger generations can buy.”

Anecdote and opinion extracted from ‘Chinese Spreading Wealth Make Vancouver Homes Pricier Than NYC’, by Hui-yong Yu and Christopher Donville, 17 May 2011, at bloomberg.com : “Cecilia Huang, a Canada resident since 2003, also is concerned about rising prices. “I hope the government can do something to control the price” so younger generations can buy, said Huang, who paid almost C$1 million for a condo in the Westside’s Kitsilano neighborhood two months ago so her daughter, now aged 6, could attend school nearby. She couldn’t afford a house and prefers apartment living because she doesn’t like yard maintenance. She also likes the views from her sixth-floor condo.”

Fueling a market by buying into it while at the same time hoping it moderates. Vancouver RE participants are overwhelmed and confused by the market action. – vreaa

Ladner On Bloomberg – “This makes it all the more difficult for people who are already struggling to get into the market or businesses who can’t hire people to come here because of the high housing prices. There are a lot of people who are really frustrated.”

Opinion extracted from ‘Chinese Spreading Wealth Make Vancouver Homes Pricier Than NYC’, by Hui-yong Yu and Christopher Donville, 17 May 2011, at bloomberg.com : “This makes it all the more difficult for people who are already struggling to get into the market or businesses who can’t hire people to come here because of the high housing prices,” said Peter Ladner, a former Vancouver city councillor and a columnist for the Business in Vancouver weekly newspaper. “There are a lot of people who are really frustrated.” Unlike London or New York, “we don’t have enough jobs with high incomes to justify” the home prices, said Ladner. He noted Australia has placed restrictions on foreign home ownership. The British Columbia government also could consider an increase in property transfer taxes for foreigners, he said.

PostCardsFromTheBlastRadius #8 – The Okanagan Bust – ‘Tuscany Villas’, Shields Down!

We..Are..The..Borg!
Lower your shields and surrender your Deposits!
We will add your biological and technological distinctiveness to our own! Your culture will adapt to service us!
Resistance..Is..Futile!

Arriving at first light,  I chanced upon ‘TuscanyVillas’ on one of those rare moments when its Shields were down!

[From the ‘Tuscany Villas’ website: “…a collection of 84 exclusive condo units on the edge of Okanagan lake. The location means unobstructed views of the specatcular [sic] landscape.” … “Construction of this West Kelowna landmark is underway. Register today to become a Tuscany Villas insider.” … “Now is a great time to buy; with all indicators showing an end to the recent pricing and sales reductions, this is the perfect time to buy into your future home or investment property.” – ed.]

‘Nemesis’ doesn’t know whether those concrete columns and embellishm​ents are structural – or merely ‘decorativ​e’ – but it did remind him of the Revelstoke Dam’s Hydro-Power-Generation Hardware…

Why ‘Tuscan’?.. Holy Moley! Hey! Way up there at the top… Are those miniature Etruscan Arches? Was our Developer a student of Architectural History, or did he just spontaneously decide to Embellish? … or perhaps his inspiration flowed from a stay at the Vegas ‘Venetian’?
——

Postscript: On retiring, a mere stones throw away from ‘TuscanyVillas’, we note something even more disturbing than the Borg Presence… this lonely, incomplete (or possibly abandoned) private home.  ‘Fortress at Monte Cassino’?…

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Photos and commentary for the ‘BlastRadius’ series by ‘Nemesis’.
[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

Manufacturing Exclusivity – “Purchase these hot condos prior to everyone else.”

Posted by SethM at RE Talks 10 May 10:13pm, who also offers to pass the opportunity on to other readers: “If anyone wants my VIP status to buy a unit, PM me. Sounds like a good deal.”

Similarly, this on craigslist 10 May 2011 4:05pm –

“There are 30 units to be released in the Compass building. They will be pre-sold prior to being made available to the public on May 28th.
Units start from $345,900.
Call Chris Kozaryn at Sutton West Coast to get the oportunity [sic] to purchase these hot condos prior to everyone else.”

Yes, you and that small intimate band of close friends who read craigslist, can ‘purchase before everybody else’. This is the attempt at creation of a ‘virtual line-up’ for this product, in the hope that a buzz ensues. In actual fact, anybody with the money can have one, guaranteed. Or, more to the point, anybody with the loan.
There will never ever be a shortage of condos in Vancouver. Never. Ever.
Fly into Hong Kong, look out the window. Fly into Vancouver, look out the window (“I am visiting rural farmlands?”).
– vreaa

PostCardsFromTheBlastRadius #7 – The Okanagan Bust – The AtlantisVernon! – AddamsFamilyValues or Keeping Up With The Munsters?

Remember them? Well, GuessWhat!
One StunninglySpooky! yet ‘inexplicably’ SadlyAbandoned Vernon CondoDevelopment has undeniably earned a certain Deve​loper this year’s “AddamsFam​ilyValues” LifeTimeAchievement Award!
As you will shortly see, when it comes to ‘Keeping Up With the Munsters!’, a crucial and heretofore​ neglected OkanaganNicheMarket has – FINALLY! – in a single stroke of PureMarketingGenius!, been ‘redoubtably’ facilitated.
Pity it didn’t ‘quite’ work out quite as planned… Let’s have a look, shall we!?

Well… First things first. ‘Nemesis’ cannot tell a lie (at least not convincingly). Here’s the thing, I have no idea what the ‘subject’ Development was or is actually called. And it’s certainly not for lack of trying. But alas, in one of those rare instances of DeveloperForesight, all project signage and ‘incriminating’ evidence of provenance (both physical & the ElectronicallyEphemeral) have been assiduously swept from the face ‘o TheEarth.
Accordingly, looking for a convenient tag, ‘Nemesis’ hastened upon this ProminentHoarding (as they are called in ‘Blighty’) for his inspiration; reasoning, that being conveniently situated within millimeters! YesMillimeters! of the SpookyCondoSiteBoundary it was ‘fair game’.
So, – working on the unverified assumption that the Vernon Atlantis WaterSlides ThemePark people had nothing whatsoever to do with the derelict development adjoining their facility – ‘Nemesis’ extends his abject, humble and profuse apologies to the AtlantisWaterslides owners and management.
There. Done.

Yikes! DoubleYike​s!!
Let’s see now, how did that jingle go?… Ah yes!
Here it is!
DearReaders, click on that for a little SitComNostalgia/‘MoodMusic’, start snapping your fingers and try substituting Nem’s lyric instead (with apologies to Will Van Dyke)…
“They’​re creepy and they’re kooky, Mysterious and spooky, They’re all together ooky, The ‘Lantis ‘Condomies’. T​he Site’s a mausoleum… Where people come to see ’em… They really are a scream… The ‘Lantis Travesty. Neat. Sweet. Petite! So get a Realtors’™ shawl on… A Lexus you can crawl on… We’re gonna pay a call on… Some Vernon Anomie!“

Well now – no mistaking that message! Let’s try another avenue of approach…

OOOPS! Maybe not this way either. Hmmm… I’ve GotIt! Let’s ‘sneak’ around the back!

Yikes, again! There’s more of them! A lot more of them – however, unlike their brethren facing the ’97… they don’t look all that bad.
Quite salvageable, really – wouldn’t you agree?
But do let’s CarryOn – with our site circumnavigation…

And there it is!
In the parlance of PropertyPimps everywhere, ‘that’ would be TheView.
Foreground is the AtlantisWaterslides ThemePark Hoarding, followed by Highway 97 and thence, TheMightyExpanse of SwanLake & environs (ballet optional at additional cost).

Wait! There’s more!
Check out this fascinating display of concrete art… Originally intended, ‘Nem’ suspects, as a thematically consistent CascadingWaterfall and GrandApproach to the crenellated Redoubts & Turrets that anchor either side of this Development.
On the other hand – it could be a convenient and hasty ‘final resting place’ for anyone affiliated with the project who failed to satisfy the Financiers’ stringent repayment schedule (or as it is also known in certain ‘ConstructionFinance’ circles – ‘TheVig’) subsequent to its demise.

And as we step back to, “take it all in”… and prior to waving goodbye…
Wait!!! Wait just one darn minute!!! What’s that???
The music??? The laughter??? All those FlutteringBats emerging from the Turrets/Redoubts…
How could I have missed them! Yes!
Them.
TheMunsters!

Go on then, DearReaders! – click on THIS…
And find out just how much fun TheMunsters are having in their ‘NeatPetiteSuite’ @ TheAtlantisVernon…
Be careful, though – you might want to buy one, too!!!
Muhaawhahahamuhahahaha…

—–
Photos and commentary for the ‘BlastRadius’ series by ‘Nemesis’.
[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

PostCardsFromTheBlastRadius #6 – The Okanagan Bust – “WhaddoWeCall It?… ‘Indigo’!”

Have you ever wondered just how it is that the ‘Creatives’ (or in ‘budget’ cases, the Developer’s SiliconeAugmented BFF) choose a ProjectMoniker? ‘Nemesis’ certainly has. My favourite working theory is that somewhere, buried deep within their Id (or, if you prefer, their repressed/unrecovered childhood memories) lurks a Movie!… A GrandMetaNarrative of such NaughtyPossibilities that it’s synaptic persistence is eternally assured – and unpredictable as to exactly how and/or when it ‘surfaces’. For example, once upon a time in the HollyWood of ‘yore’ – a rather taboo subject was addressed… and, appropriately enough, entitled – Mandingo!
Now, it’s certainly catchy! Let’s see, three syllables – easy on the ears, not too difficult to pronounce…
The screenwriter’s teaser for the production: “Expect the savage. The sensual. The shocking. The sad. The powerful. The shameful. Expect all that the motion picture screen has never dared to show before. Expect the truth. Now you are ready for ‘Mandingo’.”
Hmm? Bit racy though, eh what!?? And a questionable array of Subtext… Bondage! Slavery! Infidelity! UnBRidledNakedPassion!!! So maybe, ‘Mandingo’ isn’t quite what we’re looking for …
Hmmm…

Bingo!!!! We call it, “Indigo!!!” Doesn’t mean a damn thing – won’t offend anyone and sounds OhSoAuCurrent!!!!… DoneDeal!!!!

And so it was, ‘Done’ – or at least the FlutteringPennants! Now here’s a Ontological Conundrum to tease your InnerExistentialist!:
“In the absence of human observation/cognition do a development’s LonelyFlutteringPennants signify ‘actual’ existence or merely an illusion of actuality?”

Well, I tell a lie… The Developer of this Osoyoos project did actually put together a presentation centre, of sorts…

Indeed – no expense was spared as regards signage/typographical branding! Just check out that ‘g’!!!!

Unfortunately, signage & a shack or two, here and there… is as far as ‘Indigo’ ever got. Indeed, the PresentationCentre has sadly become yet another case of abandonment. And now – all that remains are the memories… and fluttering, tattered awnings and plywood decking strewn with shattered glass.

OHyES!!! And these two, lonely, abandoned ATCO trailers… which Nemesis presumes were intended to create the illusion of ACTIVITY… or at least, imminent construction!

Which, considering the shoreline, pastoral views, and beautiful ‘shrubbery’/foliage… bulldozing the site and pouring concrete would have been a genuine shame/spoiler (if handled indelicately – as these things so often are). So, perhaps ‘failure to proceed’ isn’t such a great loss/shame, after all…

Well, There it is! The only thing built on the site. This is the obverse view of the ProudProject Signage. DearReaders will note the presence of secondary signage courtesy of CBRE notifying other, more adventurous Developers of a ‘NewOpportunity’ to acquire same… With, best ‘o all!, a ‘NewPrice!’…

And this is what that sign must have looked like as it beckoned the WineBesotted, GoldChain wearing Throngs to the GrandOpening CockTailSoiree..

Meanwhile – back at the ‘site’ perimeter, we see yet more signage… advertising the availability of a pristine and ready to go Waterfront acreage just BEGGING for some entrepreneurial genius to resurrect TheDream!… And you will note that this particular Terrifying&Pityless ProtoRealtor of OgoPogo’s name is…: ‘Hack’…? Sometimes, MotherNatu​re can be cruelly funny. At least ‘Hack’ is not a scribbler/journo!

So, next time out.. Nem suggests they go with Racy! With Taboo! With Controversial!!!! What if they had called it “Mandingo!”… and what a TagLine, eh? “The Primeval Rhythm of Life!”…
I suppose we’ll never know. 😉

Photos and commentary for the ‘BlastRadius’ series by ‘Nemesis’.
[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

—–

[Advisory: Readers who don’t ‘get’ Nem or are perturbed by his riffs should simply skip these posts. Having said that, Nothing that Nem says should disturb one more than a glance at the market. – vreaa]

PostCardsFromTheBlastRadius #5 – The Okanagan Bust – CrewMan#6 – WhenTheWriterDoesn’tGiveYouAName… & “NewRules!” for ‘NowSelling’…

I’ll bet you thought Nemesis was kidding when he told you there was a development in the HillBillyRiviera that proudly boasted “Lavish” not “Luxury” ‘ResidentialCondos (is there any other kind?) in its promotional signage.  Well, “Ha! Ha! I say to to you!”  Because here it is.  Atypically, the Developer and or their marketing team neglected to ‘name’ this project – opting instead merely to refer to it by its street address.  Now, Nemesis doesn’t know much about the business of property development – but when it comes to ‘story development’???  Let’s just say that if a writer doesn’t think it’s worth assigning a name to a character; that character is normatively ‘toast’ well before the conclusion of ‘ActOne’.  As in the fabled ‘CrewMan#6‘ of any early StarTrek episode (see also Sam RockWell in GalaxyQuest!)…

In the splendid tradition of BillMaher’s, “NewRules” (and the EponymousCondoHype! of YVR BloggingHall ‘O Fame) – Nemesis proposes a ‘NewRule’ of his own for developer’s project signage…  1. When you’ve been flogging it for more than 3 months… all references to “NowSelling” must be eradicated.

Oh yes, 240 WadeWest, to the best of Nemesis’ occasionally faulty recollection, has been in ‘NowSelling!’ mode for well over 2 years…

Now, “Don’tTouchThatDial!”  DearReaders… for a VREAA/Nemesis RoyalConnubialDoubleHeader! is coming to a certain ExistentialistsEssential&Quintessential YVR RE BlogNearYou!… ThisFriday!…
FeaturePresentation: ” ‘RegalRidge’ Meets Harry&TheEricksons!”  And!  A BonusTreat (or is that TrickOrTreat?) FollowUp, Boyz ‘N Girlz with Sunday’s FeaturePresentation:  “TheAtlantisVernon! – AddamsFamilyValues or KeepingUpWithTheMunsters?”  So,StayTuned!

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Photos and commentary for the ‘BlastRadius’ series by ‘Nemesis’.
[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

[Readers (including ‘Fred’) who are perturbed, flabberghasted, demoralized, infuriated, or overwhelmed by Nemesis’ ‘BlastRadius Series’, are, of course, welcome to simply skip these posts.
We will point out, however, that, in extraordinary times, people are driven to produce extraordinary things. And, also, that it is not unusual for that which is closest to the truth to come disguised in words of bizarre jest. – vreaa]

PostCardsFromTheBlastRadius #4 – The Okanagan Bust – TheColossusOfWestBank & TheTerrifying&Pityless ProtoRealtors™ of OgoPogo!

Observed from a distance… at first glance I thought – perchance – Tosh! mere EarthWorks… but upon careful reflection… I realized. Realized the astonishing Truth!… It was a BurialMound! ‘THE’ BurialMound!… of the fabled Terrifying&Pityless ProtoRealtors™ of OgoPogo!

And what!?? Yes! What?… was that strange edifice on the distant horizon????

And then… I saw them… Faded HieroGlyphs of the fearsome ProtoRealtors of OgoPogo!…
If I wasn’t worried before, I was certainly WORRIED now. What next, I speculated… what next?

Fluff! Fluff? WTF?….
Standing upon… the ThreshHold of AncientRuins? Ruins of a LostCivilization? ‘Nemesis’ momentaril​y reflected, “To what bestial purpose?” – and then.. TheGrandStartle!
Yes! Startled! by the sound of distant drums!!!
And then they came!

Chanting!​ Gyrating! Naked!
The Terrifying&Pityless ProtoRealt​ors of OgoPogo!!!​… together with their sacrificial offerings to TheGreatSerpentOfTheLake.
Untold legions of captive FTB’s! Bound&Marinaded!
How they screamed!.. Begged for mercy!…
Frantically Struggling and Straining to free themselves from the DebtBondage of onerous PSA’s & 0Down VR ClosedMortgages… With obligatory HELOCS!
WhatSavagery!
But – Alas, ToNoAvail.​..
TheHorror. TheHorror. TheHorror.

A gruesome spectacle ensued… of such blood-curdling malevolent, hideous violence that even today, sometimes in the darkest recesses of night… Nemesis still awakens in a cold sweat..,
The victims’ screams echoing… echoing…
Altogether, more terrifying than ANYTHING you could possibly imagine! Anything.
TheFluff. TheFluff. TheFluff… of ‘stuff’…
Whey will they learn?

And now, a brief ‘homage’ to the RealArtistes of TheColossusOfWestBank…
‘primitiveWannabe’ Banksies…
You know who you are…
Keep Spraying. For truly, it is ‘Opus Dei’…

More seriously, all this was the prelude to a failed BluffTop housing development…. and the Ruins were apparently the ‘staging’ for what must surely have been the GrandestOfTheGrand of ExtravagantPreSales Offerings…
All Brought to you by ExciteHomes. The Principals of ExciteHomes are gone now and out of respect for their sorrow/shame, ‘Nemesis’ will not reveal (albeit he does know) their current whereabouts/circumstances… But RestAssured, VREAA readers… it is a CautionaryTale of the UtMostMagnitude!…

Ah… Some of you were wondering about Nemesis’ veracity… re: TheDrums… the ThunderousBeatingDrums of OgoPogo!
Well, here they are. And, Yes – They’re Toxic.
and, apart from the GrandStaging… these are all that remain…
‘Nemesis’, having neglected to come equipped with HAZMAT gear did NOT venture too closely…
Ergo, for the time being – at least – the contents of TheDrums of the Terrifying&PityLess ProtoRealtors of OgoPogo shall go unremarked…

And so, our tale concludes… But, TruthBeTold – TheColossus is (Sacreligiously & CockPosterously!) ACTUALLY situated adjacent to the GenuineArticle…
A real – sacred – burial ground.
Shameless.
Well, Boyz&Girlz…
It all ends like this. If you’re lucky, your loved ones (& others you never knew were ‘loved ones’) will remember you fondly…
So… please strive for excellence and try to FightTheGoodFight!
In between, have some Fun… and do what you can…
—–

Photos and commentary for the ‘BlastRadius’ series by ‘Nemesis’.
[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

Cam Good in the Vancouver Sun – “If you suffer from real estate impotence, stop feeling sorry for yourself, pick up the phone to call a realtor or a mortgage broker. Real estate is the best investment you’ll ever make.”

Excerpts from ‘The new real estate protectionism is misguided’ by Cam Good, Vancouver Sun 21 Apr 2011. Mr Good is president of a real estate sales and marketing company. –
“In the last two months, we’ve sold over 700 condos in Toronto. Sixty per cent went to Mainland Chinese buyers. In meccas like Richmond, 98 per cent of the hundreds of homes we’ve sold are to buyers who are Chinese.” …
“Buyers from Mainland China are a driving force in our real estate market. The staggering truth is we’ve seen just the tip of the iceberg.” …
“A recent story in the Wall Street Journal reported that Chinese are “stampeding to Vancouver and Toronto, two of Canada’s hottest markets.” For that, we should be grateful. Chinese have made owning real estate in Canada more rewarding than any of us expected and they have made our society distinctly richer by bringing their values and culture to Canada and sharing them with us.” …
“But instead of gratitude, I see growing fear and resentment that foreign buyers are inflating prices and pricing “us” and “our children” out of the market. I recently hosted a helicopter tour of White Rock for a select group of Chinese realtors. In response to the media coverage of that event, my office was inundated with emails from people who think this will cause a Chinese takeover.” …
“Let’s look at what this global trend is doing to benefit us: It’s driving demand and creating a real estate industry that is the envy of the entire world. Our land, homes and businesses have become more valuable and Chinese investment is a big reason we weathered the global economic storm as well as we did.” …
“If you suffer from real estate impotence, don’t blame Chinese people. Besides, getting all worked up about it will only make it worse. Have a glass of wine. Relax. Stop feeling sorry for yourself and pick up the phone to call a realtor or a mortgage broker, either of whom will be more than happy to show you how easy it can be to get your real estate groove on.
Real estate is the best investment you’ll ever make, but don’t take my word for it. Ask any of the 70 per cent of Canadians who are already owners. Or a Chinese person.”

The fact of this article, and its contents, preserved here for the record.  – vreaa

PostCardsFromTheBlastRadius #3 – The Okanagan Bust – “Life Revolves Around You!”

From the WebSite:
“Welcome to Centre Point, where Life & Style are perfectly in sync.”
[NemNote: When you allow that the developer’s market timing was apparently rather less than ‘in sync’ with condo-newbie appetites – it’s just as well that they got the ‘Life&Style’ thing right. Nemesis wonders though, which elements of life are ‘synchronous/analagous’ with/to vinyl extrusions and particle board? The Coprological?]
“Located in Kelowna’s ‘picturesque’ South Glenmore, this idyllic setting means you don’t have to compromise location for convenience.”
“Only moments from everywhere you want to be, but away from what you leave behind – never before has there been an address that offers it all.” [unlike, say – Buckingham Palace?]
“A true urban [!?] retreat. Centre Point brings new, affordable and ‘luxurious’ rental apartment living to the centre of Kelowna.”
[‘Nem’Note: Do WagCondoCopyWriters/Hypers contest amongst themselves to see who can weave the most glaring oxymorons and cliche into ‘ThePitch’?]


Have a close look at that signage, Boyz ‘n Girlz – you’ll notice that the rental offer is, in fact, a recent vinyl ‘appliqué’ – the obvious intent, to camouflage (or mask, if you prefer) the development’s quasi-mystical transubstantiation from ‘ownership’ to ‘rental’. What will they think of next!?

For a development purportedly nearing completion and with a projected tenant occupancy timeline of ‘June-ish’… there was an astonishing dearth of visible activity on the CentrePoint site. But never mind, as the wind generated opening and closing of the unsecured double-glazed UPVC balcony doors more than made up for all that with some delightful – if random – melodies remniscent of the haunting Japanese ‘Shakuhachi’.

Photos and commentary for the ‘BlastRadius’ series by ‘Nemesis’.
[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

“It is impossible to get honest information on the RE market. Even the analyses coming from a reputable university are manipulated by people who have vested interests in that industry.”

El Magnifico at VREAA 15 April 2011 3:21am. Excerpts – “I had a very interested conversation yesterday with the “boss” of Tsur Summerville (the RE guru at UBC). I asked a few questions about the RE market in Vancouver and his views are interesting:
– He [the “boss”] genuinely doesn’t believe that a RE crash will happen in Vancouver. He definitely thinks that the RE won’t go up anymore but he said we can expect a slight correction (maybe 5-10%) and then a flat market for years (basically until salaries/economy catch up)
– He acknowledges that there has been a massive inflow of mainland Chinese buyers in Vancouver but also told me there are no serious studies conducted regarding their impact on the market (like say % of transactions made by mainland Chinese). He said such a study won’t be conducted because it is too politically sensitive…
– The most interesting thing he said is that Tsur is definitely aware that the RE market in Vancouver is in bubble territory. He issued a few statements about that and got some heat back from the RE industry (who by the way finance most of his research). So anything that comes out of his office is being made not to offend the RE industry at large, and his sponsors… It is sad that it is impossible to get honest and genuine information on the RE market. Even the analyses coming from a reputable university are manipulated by people who have vested interests in that industry…“

PostCardsFromTheBlastRadius #2 – The Okanagan Bust – ‘The Conservatory’ Becomes ‘The Reformatory’

TheConservatory!  Look On My Works, Ye Mighty and Despair!
Kathy[Michaels]@Kelowna.com: “If there’s ever been a project that highlights the inherent risks of putting money down on something that doesn’t yet exist, it’s The Conservatory in Glenmore. Developers broke ground for the 99-unit luxury residential condominium nearly [nine] years ago…  It sat for several years as a big, yawning hole in the ground, the subject of neighbourhood jokes… Shortly after ground broke in October 2002, work came to a halt and it took until 2005 before financing issues were resolved and crews headed back to the site again [albeit, only temporarily!]. Further exacerbating the issue was that there was no means to recoup costs from investors who purchased their suites at a cost of  $240 a square foot. The most developers could increase prices was by 27 per cent, but by the time the property went into receivership, the costs were more in the range of  $470 and $550 a square foot…”

Quick, call CentralCasting! All we need are a few emaciated ‘Rent-A-Refugees’ and we can ‘wrap’ that Bosnian MovieOfTheWeek under budget/ahead of schedule! Just imagine the LineProducer’sBonus we’ll score on that one, Boyz ‘n Girlz!

Alternatively, given TheConservatory’s resemblance to the kind of ‘WorkersParadise’ housing so ubiquitous in the former SovietUnion/EastBlox – perhaps we could resuscitate SCTV’s inimitable CCCP TV and gift it this lovely ‘new’ OkaNaganProduktionComplex!

Nix the foregoing!!!  Because: Bingo!…  Nem’s had another epiphany!.. Here’s the thing, with all the recent controversy regarding the cost/location/siting of a new regional provincial correctional facility – why not ReBrand ‘TheConservatory’ as…
TheReformatory!
After all, they already have a secure perimeter and more than enough ‘luxury suites’ to accomodate hundreds of new guests! Best of all, harness those very same ‘new guests’ to complete the project and you’ve got a vocational rehabilitation programme at ‘pennies on the dollar’!…
A ‘WinWin’ all around! – for BC Taxpayers and Provincial ‘GuestWorkers’ incentivized to finish their lodgings before Winter’s chill arrives!

Of passing interest, an actual ‘CrimeScene’ adjacent to TheReformatory’s SecurePerimeter.

Cleaned out and ironically emblematic of the TheReformatory’s financial woes – a petty cash box most likely taken from one of numerous abandoned ‘Atco’ construction offices/trailers nearby.  Further proof, if any were needed, that the villain who does his ‘RE Homework’ first needn’t waste time forcing entry to unproductive venues.  ‘Nemesis’ neglected to bring his CSI toolkit on this occasion – so instead, notified on-site security who were demonstrably pleased to finally have something to ‘observe & report’ besides the sado-masochistic exhibitionism of self-flagellating RemorsefulRealtors™.

Now as CrimeScenes go, this ain’t just any old Reformatory – nope, it’s a Reformatory with a view!… Albeit, this PrisonersPanorama features a vanquished pastoral idyll.  Where once orchards predominated – sadly, now rise the HousingTractsOfTheDamned™.
‘Nemesis’ is feeling biblical…  nay, not CrefloDollar ‘ProsperityGospel’ Biblical [aside to audience: google that one, cause I swear you can’t make up/write s**t like that]!  But OldTestament, CharltonHeston, CecilBDeMille – WrathfulBiblical!…  Accordingly, time for a little apropos Jeremiah…
Prophecy Of Jeremias (Jeremiah) 6:4-5 [Douay-Rheims]
[4] Prepare ye war against her: arise, and let us go up at midday: woe unto us, for the day is declined, for the shadows of the evening are grown longer. [5] Arise, and let us go up in the night, and destroy her houses.

Sometime soon, in the not terribly distant future, Nemesis ‘prophecies’ that authentic indigenes (aka FirstNations) will doubtless refer in passing to all this as, “The ‘hallowed burial grounds’ of a greedy, foolish and primitive people.”.. Speculative fiction or prescient forecast? We’ll see… 😉

What’s worse, this view to the hills from The Conservatory, or the reverse? Thanks to Nemesis, for illustrating the desolation of a housing collapse,  already commenced in our periphery. -ed.

Photos and commentary for the ‘BlastRadius’ series by ‘Nemesis’.
[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

Mindless Consumption – “Spending money we don’t have, on things we don’t need, to create impressions that won’t last, on people we don’t care about.”

“Having your entire financial worth wrapped up in a house and living on its nominal value is a risky situation. But in a way, [this] is only following cultural norms. Homes today fulfill much more than a need for shelter. They are physical representations of our tastes and the lives we lead — or wish we led. Last year, Los Angeles Times columnist Meghan Daum chronicled a lifetime of housing lust in a memoir whose title sums up a common attitude: ‘Life Would Be Perfect if I Lived in That House’. “Few things in this world are capable of eliciting such urgent, even painful yearning,” she writes. – from ‘Housing: Real insanity’, Canadian Business magazine, April 25, 2011

“We are being persuaded to spend money we don’t have, on things we don’t need, to create impressions that won’t last, on people we don’t care about.” —Tim Jackson, economist, from talk at TED.com

Canadian Business Mag: ‘Housing: Real insanity’ – On Renters And Owners

The article by Joe Castalado at canadianbusiness.com 25 Apr 2011 is an absolute must read for anybody with even a vague interest in Vancouver RE. It is a multifaceted article, and we have/will highlight various bits and pieces of it elsewhere. It is headlined here to archive its presence in the chronology and to encourage all to take a look.

We also take the opportunity here to highlight excerpts that summarize well the renter/owner discussion:

“Canada has a long history of embracing property ownership (it was once a requirement to vote), and government policy continues to support it. “It’s a virtuous circle,” says Phil Soper, CEO of Royal LePage. “Governments have been elected over the years for putting forward policies that encourage home ownership, and people have in turn viewed it as good policy.”

Politically, it makes sense for governments to cater to homeowners, a powerful voting lobby. But part of the logic behind supporting ownership is that it’s [good] for society. The prevailing wisdom is that homeowners vote and volunteer more than renters. They’re more engaged with their communities. They’re even healthier. In short, property ownership makes better citizens.

The evidence for this is dubious. William Rohe, director of the Center for Urban and Regional Studies at the University of North Carolina at Chapel Hill, summarized the existing research a few years ago for a Harvard University housing journal. He found that homeowners have higher self-esteem than renters, but pointed out that the original studies may not have adequately controlled for other contributing factors. Numerous studies also show that homeowners participate more in volunteer organizations and political activities. It’s still unclear, wrote Rohe, whether ownership actually leads to this behaviour. Yet another purported benefit of ownership is that it fosters better education for children. Again, the evidence is weak. A paper in the journal Real Estate Economics published in 2008 examined much of the literature using more sophisticated analytical techniques. It found that children of American homeowners scored no better on math and reading tests than renters’ kids, nor did they have lower high-school dropout rates.

Grace Bucchianeri, a professor of real estate at the Wharton School of Business, found the societal benefits of home ownership to be similarly overblown when she examined data collected from 600 women in Ohio. She found little evidence to support the idea that owners participate in civic and community activities any more than renters, and after controlling for factors such as income, housing quality and health, she concluded that owners were no happier. In fact, they spent less time on leisure activities and socializing with friends than their renting counterparts. When you look beneath our assumptions, Bucchianeri writes in her 2009 study, “the intuitive link between home ownership and well-being breaks down.

As for the renter’s fear of losing out financially, that too is exaggerated. Today, the average home-price-to-rent ratio is at its highest level on record, which means renting may actually be more affordable than paying a mortgage. Furthermore, a 2007 study from the UBC Centre for Urban Economics and Real Estate found that over the past three decades, renters could have beat homeowners’ financial results. The study examined the theoretical returns of buying versus renting in nine Canadian cities. In four of them, renters who invested wisely could accumulate 24% more wealth than homeowners, and match it in three others.
…
Considering the inconclusive research, it might be time to rethink the degree to which governments support homeownership. David Hulchanski, an associate director of research at Cities Centre at the University of Toronto, for one, argues that our current system punishes renters. … Housing policy should stop blindly favouring ownership, Hulchanski argues. Eliminating the capital-gains tax exemption on home sales would be one way to free up some cash. “That’s billions that could be used on rental or social housing, and we rebalance the system,” he says. He knows the prospects of that are next to zero, however. “Even the NDP is silent on it.”

“The home across the street recently listed at $1.8M and sold at $2.5M is —wait for it— back on the market today with a fresh price of $2.88M.”

Siddelly at greaterfool.ca 7 Apr 2011 11:44pm – “If you thought Point Grey RE could get any weirder, it appears there are now signs of a flipping frenzy occurring. As my step-mom awaits her check for her recent sale at 11th and Camosun for 2.5 million, the home across the street which was cited in moms listing as being recently listed at 1.8 and sold at 2.5 is-wait for it- back on the market today with a fresh price of 2.88 million and offers to be taken shortly apparently. The ad states that they can build you your dream home which sells by the way, for over 5 million. Up up and away!”

Vancouver city staff consulted foreign government over bylaw

From Vancouver Sun, 8 April 2011– “City engineer Peter Judd admitted that Vancouver city staff consulted with the Chinese government over a proposed bylaw that would prevent Falun Gong protesters from erecting billboards and huts in front of its Granville Street consulate, [Vancouver City] council was told Thursday.” … “City manager Penny Ballem said the city entered into a “confidential agreement” with the Chinese consulate in order to get feedback on the proposed bylaw.”
“Clive Ansley, a lawyer representing the Falun Gong, said it was “disgraceful and indefensible” that Vancouver consulted with the Chinese government over “the extent to which Canadians’ freedom of expression should be curtailed. “They are representatives of a foreign government and the issue we are discussing here is the Charter of Rights and Freedoms and how it applies in Canada and the right to free political expression on the part of Canadians,” Ansley said. “No foreign government has any legitimate input with respect to these issues.”

This issue is relevant to RE in Vancouver because it highlights the lack of clarity that many in positions of power have regarding appropriate boundaries, inappropriate influence, and conflicts of interest. Who do our civil servants serve? Recall that the provincial premier received >50% of her campaign contributions from the real estate industry. – vreaa

Spot The Speculator #33 – House $650K; Rental $585K; Debt $995K; 450% Of Net Worth In RE

Anecdote extracted from ‘Two properties, one complex problem’, Financial Post, 1 Apr 2011 [hat-tip SM]-
“In British Columbia, a couple we’ll call Harry, 36, and Felicia, 33, have a 15-month-old daughter and a complex problem. Their total combined monthly take-home income, $7,594, plus $400 of rental income, adds up to $7,994 per month. It covers current expenses, but for the future, income gains will have to come from Harry’s job.
Felicia, recently diagnosed with a neurological condition, is on long-term disability that pays her $2,394 a month after tax. Harry, an architect, works four days a week for monthly take-home income of $5,200. Their combined income services mortgages of $606,000 on their house and $384,000 for a rental property. Those two mortgages with associated property taxes take $5,420 out of their monthly take-home income. Property taxes take another $509. That’s a whopping 74% of after-tax income. ”
“Harry and Felicia have just $20,000 in RRSPs or other financial assets, not including $2,400 in a registered education savings plan. Expenses eat up total after-tax income with almost nothing left for little extras.”

Assets
House $ 650,000
Rental property $585,000
RRSPs 20,000
RESP 2,400
Car 10,000
TOTAL $1,267,400

Liabilities
House mortgage $606,000
Rental mortgage 384,000
Student loan 4,680
TOTAL $994,680

Net Worth $272,720

This, people, is why the Vancouver RE market is so very, very ill.
Harry and Felicia have 450% of their net worth in RE (yes, 450%, not a typo).
If RE drops just 20%, they are wiped out.
When RE drops 50%, they will have a negative net worth of $345K.
($618K drop in value of RE – $273K current net worth).
They are relatively young, but this setback will colour their financial health for decades to come.
Again, we see rabid speculation in the guise of normality.
There are many in this kind of situation, and only a very small percentage will be able to lighten up before the market crashes.
– vreaa

PostCardsFromTheBlastRadius #1 – The Okanagan Bust – “Life Beyond Expectations”

‘Nemesis’, one of our regular and eloquent contributors, offers these images from the Interior, with his own inimitable commentary.
The first of a series of occasional photo-essays.
Coming soon, to a city near you. -vreaa

Lucaya. Look On My Works, Ye Mighty and Despair!
An abandoned residential, prime water-front property development adjacent to Kelowna’s SkyeTower, which same – in a frantic endeavour to stave off imminent receivership – last year infamously reduced ask on remaining inventory by more than 40% (to the existential consternation of prior/pre-sale contract purchasers).

[Note to ChristianVultures: Lucaya is conveniently located mere steps from Kelowna’s legendary, Charismatic Christian ‘Living Faith Miracle Centre (Mending Lives – Giving Purpose)’ – where Pastor Tracy Weekes together with her husband, ‘Apostle’ Everton Weekes rapturously promise their acolytes, ‘[a] fullness of intimate worship, where they can encounter God’s awesome presence and his healing touch’. Or as former TeleEvangelist Jim Bakker once remarked to his ‘shy/reluctant’ (but fetching) personal assistant, “When you help the Shepherd, you’re helping the sheep”.]

Lucaya’s derelict ‘Presentation Centre’.

Broken glass and unclaimed telephone directories litter the entrance.

Lucaya’s Deliciously Ironic LogLine: “Life Beyond Expectations”

Lucaya’s unfinished foundations – a forest of rebar and pre-stressed concrete monoliths – finds new life as combined ‘canvas’ and ‘gallery’ for aspirant local ‘Banksies’.

Lucaya ‘Tagged’.

Kinetic sculpture a la Lucaya.

[Images Ⓒ​2011 ‘Nemesis’ – All Rights Reserved]

DTES Shipping Container Apartments – $85K; 320sqft

Excerpts from ‘Shipping containers to be Vancouver housing’, CBC 5 Apr 2011 –
“Vancouver will soon see a new type of social housing for disadvantaged women — an apartment complex made out of shipping containers.
The structure — the first of its kind in Canada — will occupy a currently empty lot at Jackson Avenue and Alexander Street in the Downtown Eastside.
Vancouver city councillor Kerry Jang supports the project, as long as the units are liveable. “This is an issue I’ve been very concerned about [is] liveability. I mean, as soon as you say the word ‘container,’ people think you’re just warehousing people.”
Despite the concept, residents won’t feel boxed in, said project supervisor James Weldon. [haha -ed.]

Commenters point out that similar conversions have been done for $10K per unit, and surmise that the $85K must include land value. But perhaps not. Is the city selling or leasing the land on which they are built?

A quick search for ‘$85K, Florida’ came up with this, the first RE hit, we’re sure there are hundreds of other examples:
12 Sep 2010: 1216 Oregon St, Orlando, FL 3280, $85K

Yes, a short sale/foreclosure, but, you get the idea.
We in Vancouver are so brainwashed by $1M, $1.5M, $3M handles on RE that $85K for a 320sqft pre-fab unit in the DTES starts sounding like a deal.
Everything in Vancouver and vicinity is screamingly overvalued. – vreaa

Spot The Speculator #31 – “My neighbours (late 60s, early 70s) have decided the way to fund retirement is to go into the RE development business.”

vancouverite at vancouvercondo.info March 22nd, 2011 at 9:37 am– “My neighbours (late 60s, early 70s) have no retirement plan other than the government so have decided the way to fund the rest of their lives is to go into the development business because, as they say, real estate only goes up. They HELOCed the hell out of the teardown they’ve been living in for 30 years (never had the money to maintain or fix up) and purchased a house down the block for $1.5M ($150,000 over asking and they were the only offer). They were in a panic to get the money before March 18th because they needed the full 95% of assessed value of their own house to be able to do their deal. They are expecting to sell the development for over $3M when it’s completed – the lot they bought is 33′ x 120′ half a block in from a busy street on the west-side. I see a world of pain in their future – they were scrambling to find cash to pay for liability insurance on the development site.”

Such a profoundly illustrative story it is hard to know where to start:
– Many are relying on RE for their retirement funds.
– Many believe that RE is the way to quick wealth. This couple are aiming to get ball-park 50% return over less than a year (assuming about $750K cost of build). That kind of return only comes with high risk, but the risk appears to be invisible to Vancouver RE players.
– Local speculators are buying westside properties.
– Banks are forwarding large HELOCs for dodgy projects.
– HELOCs are fuelling RE speculation.
– At least some of the pre-18-March demand was mortgage deadline related.
– Current sentiment includes urgency.

Fundamentals – “When would you buy?”

We haven’t mentioned the actual word  ‘fundamentals’ here for a while, probably because they seem so, well, passé for Vancouver. But the concept remains alive and well, if a little dormant, in the minds of the few remaining prospective buyers who see the market as bizarrely overvalued. Sometimes such folks are asked: “When would you buy?”
On a recent thread, ‘matt’ pointed us all to a 2008 NYTimes article on this very subject, a useful reminder in these frothy times. It’s worth the re-read, if just to keep oneself in touch with the reality of the extra-Vancouver universe: ‘As Home Prices Drop Low Enough, a Committed Renter Decides to Buy’, by David Leonhardt, NYTimes, 28 May 2008. A few excerpts: –

“One of the big lies of the real estate business is the idea that renting a home is tantamount to throwing money away. It’s a useful fiction for real estate agents, because they make vastly bigger commissions on house sales than rentals. But the comparison isn’t nearly so straightforward for the rest of us. Renting involves one obvious, recurring cost that can never be recouped: the monthly rent check. Buying, on the other hand, involves multiple expenses, some of which aren’t so obvious. On top of closing costs, there are repairs, property taxes, mortgage principal and mortgage interest. When you own, you also lose the ability to invest your down payment elsewhere, like the stock market.”

“Over the last several years, I’ve come to like a simple, back-of-the-envelope way to compare the costs of renting and owning. You find two similar houses, one for sale and the other for rent, and divide the sale price by the annual rent. You can call the result the rent ratio.
It’s the real estate market’s version of a price-earnings ratio — a measure of how expensive an asset is, relative to the underlying economic fundamentals. Like a P/E ratio, the rent ratio provides something of a reality check.
Throughout the 1970s, ’80s and ’90s, the average rent ratio in the US hovered between 10 and 14. [In the mid 2000’s] it broke through that historical range and hit almost 19 by the time the housing market peaked [in the US], in 2006.
And while home prices — and rent ratios — have always been higher on the coasts, they reached whole new levels recently. In the Washington area, the ratio went above 20. In Boston, New York, Los Angeles and south Florida, it topped 25. In Northern California, it approached 35, higher than it had been in any city, at any point on record.
In concrete terms, a rent ratio above 20 means that the monthly costs of ownership well exceed the cost of renting.”

“The question facing my wife and me was whether we were entering the market before the correction had gone far enough. I really didn’t know what the answer would be. So as we looked at houses, I started calculating rent ratios. In the neighbourhoods where we were looking, two-bedroom condominiums were selling for $400,000 and being rented for about $2,100 a month, which makes for a rent ratio of 16. Four-bedroom houses were selling for $700,000 and being rented for almost $4,000, which makes for a rent ratio of 15. No matter the price range, pretty much every apples-to-apples comparison produced a similar ratio. Historically, this is still a bit high.”
—

Using similar calculations, ‘rent ratios’ [sales_price/annual_rent] for SFHs in Vancouver are currently commonly in the 40-42 range. -vreaa

Animal Spirits, Primitive Superstitions – “Address numbers could hold key to fortune”

From CBC news article (online and video), 9 Mar 2011 [hat-tip Nemesis] –

“Leah Hendry now with how changing your house number, could help you get lucky. An increasing number of Vancouver homeowners are changing the numbers in their property addresses — to attract either good luck or Chinese homebuyers. For $676 you can apply to change your address.”

“The number four may seem innocuous, but for some cultures the word sounds similar to the word for death. “In Chinese, it is pronounced as sssss, and the Chinese [word for] death is zssss,” said Vancouver realtor Alec Zhang. “That is why people do not like the four.” A number ending in four is especially avoided, he said.”

Linda Wener had her home on the market for five weeks before it sold for well below her asking price. Her house number was 3364. “I just never even thought of it,” said Wener. “Somebody said it was ‘bad.’ I said, ‘It’s what it is.'”

The number could have been a factor in how the sale went. “If you keep this number, it may reduce your house value by two, three, even five per cent. If you can change the number to 3468 or 3466, that would be a perfect number for Chinese buyers. “

Vancouver realtor Wayne Hamill says spending $676 to change his house number was a good investment. “8s tend to get a little more attention than houses that don’t, they get a lot more attention than houses with 4s in them”

“We’ve had 8 (address change requests) just in the first week of March.” [That’s gotta be a good sign! -ed.]
—

Comment: We’ll call this what it is: Primitive superstition; magical thinking; false belief.
Just the kind of lunacy one would expect to make the news and alter behaviour when the herd is running crazy. Animal spirits are pulsing.
Next up: Exorcise your basement. -vreaa

“A home inspector who is having TONS of work in White Rock recently, whereas he barely ever made it out there before. Asian buyers, Higher end of the market, $1MM+.”

Devore at vancouvercondo.info February 28th, 2011 at 5:33 pm– “Had lunch with friends today, ran into a home inspector who joined us. Is having TONS of work in White Rock recently, for Asian buyers, whereas he barely ever made it out there before. Higher end of the market, $1MM+, not the stuff for us regular riff raff. After the RE rules changes in China, I wouldn’t be at all surprised HAM [‘Hot Asian Money’ -ed.] is pouring into wherever it is allowed to, including the nicer areas of LML. Anyways, never meets the buyers, maybe the realtor or the son (driving around in a Porsche of course). Meanwhile, the lower end of the market, and outlying areas (not Van, Richmond or White Rock apparently) is quiet at best.”

Young Siblings Buy UBC Condo; With Help From Petroleum Engineer Dad

“Siblings Bayan, 21, and Roya, 18, Bennett grew up in Qatar, Thailand, Venezuela, and Canada. The nomads have alighted at UBC to continue their post-secondary education—Bayan, his third year of biomedical engineering; Roya, her second year of an arts degree. Uninterested in cramped (mono-sex) student residences, they opted for a condo in the campus’s new village.
The Bennetts looked at 10 other places around town, including a spot kitty-corner to the fraternity houses, before settling on an 856-square-foot condo in the Pacific Spirit development. 5928 Birney Avenue; $655,000. [$765 per sqft; land is leased]
They liked the water feature out front and generous patio in the back. With financial assistance from their father, a petroleum engineer, the siblings moved in at the end of July. With classes in full swing, Bayan and Roya haven’t had time to decorate the two-bedroom, two-bath unit. “It’s still kind of a mess.”
– from ‘UBC’s South Campus: A residential neighborhood is springing up in the heart of the UBC campus’, 1 Oct 2010, Vancouver Magazine

52% Backed By Real Estate – Analysis Of Contributions To Campaign Of Christy Clark, New Leader of the BC Liberals

Who influences our political leaders?

Here follows the results of an analysis of the sources of campaign donations to Christy Clark, new leader of the BC Liberal Party.
(Thanks to ‘Nemesis’ [at VREAA 27 Feb 2011] for the list [pdf here].)

Methodology:
Each source was researched online, and classified by industry type, as best as possible based on available information.
Results were analyzed by number of contributors, and by dollar amounts.
Businesses classified as real estate related were developers, contractors, construction, property managers, realtors, and RE marketers.
A minority of sources (21 of 147) could not be reliably classified (for instance numbered or named corporations with no online presence, or individuals whose industry affiliations could not be ascertained) and they are classified accordingly.

Results:
Total contributions: $513,200*
Total number of contributors: 147*
[*For the sake of this analysis, we have removed the single line item ’55 donations under $250′ and the $5,840 that they contributed.]

Contributors & contributions by group:

A. Contributor known to be affiliated primarily with RE related industry:
(i) Number: 46/147
(ii) Dollar amount: $267,250

B. Contributor known to be affiliated primarily with industry that is not RE related:
(i) Number: 80/147
(ii) Dollar amount: $212,300

C. Contributors where industry affiliation cannot be ascertained:
(i) Number: 21/147
(ii) Dollar amount: $33,650

Percentage of known industry affiliated contributions coming from contributors with known RE affiliation:  55.7% ($267,250 of $479,550)

Percentage of all contributions coming from contributors with known RE industry affiliation:  52.1% ($267,250 of $513,200)

Comment:
We anticipated that the RE-affiliated portion would be large, but 52% is substantially larger than we expected, very much more than the percentage of our GDP made up by directly RE-related industry (20-22%, we believe).
Powerful vested interests means ongoing misallocation of resources.
The provincial and municipal governments will likely continue to do everything possible to perpetuate the speculative mania in Vancouver’s housing markets.
-vreaa

“I know a number of cases of underused houses purchased by asian buyers.”

900kCrackHouse at vancouvercondo.info February 15th, 2011 at 8:43 am – “I know a number of cases of underused houses purchased by asian buyers:
1) My friends apartment was just purchased by foreign buyers and he was kicked out for “renovations”
2) I know a 20 year old university student who’s rich aunt from Asia just bought him a house in North Burnaby. He manages the tenants and when he can afford to pay the 70% mortgage, he gets the house. Oh, and I should mention they own two more houses in Burnaby, one of them a $1 million dollar house occupied only by the Aunt’s 18 year old kid.
3) Huge house in Fraser Heights in Surrey occupied by a 90 year old Grandma. The 18 year old daughter used to live there, but she wanted to live close to UBC so they bought her a condo out there.”

What do you do when you’re the investor owner of an ‘underused house’ and the price starts steadily dropping, month after month? Along with ‘local speculator’, and ‘boomer’ supply, ‘foreign investor’ supply will all start coming into the market at the same time. These groups of investors are largely momentum players, and they’ll start leaving when prices start heading the wrong way. -vreaa



$695K (35%) Over Ask Dunbar Tear-Down; 52×130 For $2,683,000

calguy asked today at VREAA: “Can someone confirm a sale recently, last week in Dunbar. A bungalow at 4035 west 28th was listed at 1.9 million and sold for 2.6!!! I thought I saw it somewhere but can’t remember where. It was listed as a building lot. A shame as it looked like a nice home for a reno. I remember when these homes were 1 million and we thought that was expensive then!”

4035 28th Ave W
3,057 sqft house; 52×130 lot; MLS V869100
Listed 10 Feb 2011: Ask price $1,988,000
Sold 19 Feb 2011: Sale price $2,683,000
$695k [35%] over ask.

Near private schools. Fairly solid house, by Vancouver standards, but clearly bought as a tear-down. It was advertised as “An excellent holding property or build your dream home.” It’s hard to imagine anybody sinking $2.7M into RE so they could live in this modest house. More likely they will spend another $1M on top of that to rebuild. So, we could use this sales price as rough lot value for this area. And, arguably, as another example of misallocation of resources (a perfectly usable home is destroyed).
As frequent readers know, we often cite the possibility of 50% off in the crash. Here we’ll make an exception and say that we wouldn’t be at all surprised if lots this size change hands for a lot less than $1M in Dunbar in future years. That’d be a drop of more than 63%.
It would be interesting to know if this house was purchased by a SFH developer or end-user. Anybody know more? -vreaa

“I’m one of these guys that just left Vancouver for London, UK. The prospect of not being able to afford anything despite my $100K/year salary finally turned me off.”

El Magnifico at VREAA 15 Feb 2011 4:03 pm –
“I’m one of these guys that just left Vancouver for London, UK. I really loved the 5 years I spend in Vancouver, but the prospect of not being able to afford anything despite my $100/year salary finally turned me off. My company offered me a 6-month mission with expat package in London, which I accepted despite the fact that my wife was pregnant (she just delivered last Friday!). I arrived in London on January 14 and I truly love it. My local boss offered me to stay in London after my mission, on a local contract… I thought about it, discussed with my wife and we decided it was the best option for us. London is expensive too (although groceries are much cheaper), but I’ll be paid 30% more here than in Vancouver. My standard of living is and will be better than in Vancouver and I will be able to afford something here in the foreseeable future. Job opportunities are limitless here, unlike tiny Vancouver…
After spending a month here and looking back, I just think Vancouver is so outrageously expensive. From Groceries to housing, shopping, restaurants, etc., everything is overprice with most often questionable quality/service. In Vancouver, I find I’m getting ripped off all day long (don’t get me started on Banking or worse mobile phone). Things are expensive too here, but I find I do get value for what I pay. And I just love so much going to Museum… for free!
Vancouver is good but certainly not the “best place on earth” (how pretentious!!!), and there are lots of amazing places around the world that are more worth it than Vancouver.”

Burnaby Condo Presale Lineup – More Shameless RE Promotion Presented As ‘News’ By Global TV

Last week the helicopters, this week the paid-for line-up. The crazy swirling circus music is reaching fever pitch. -vreaa

In brief:
A condo development is going on sale in Burnaby this coming weekend (19 Feb 2011). A line-up commenced Wednesday 16 Feb. Online ads had appeared in the days before, offering to pay individuals to stand/sit/sleep in this line-up. Global TV covered this line-up as news. ‘Alex’ published an open letter to Global TV accusing them of knowingly airing commercial promotional material as ‘news’.

In more depth:
The “Sovereign” by Bosa Properties, corner of Kingsway & Willingdon, in Burnaby.
45 stories, 202 units, starting at $260K.
Construction scheduled to be complete by 2014.

A craigslist ad appeared on 13 Feb 2011 [hat-tip greaterfool.ca] –
“PEOPLE NEEDED TO LINE UP FOR NEW CONDO PROJECT
Date: 2011-02-13, 4:06PM PST
Just as the title says, we need people to hold spots and line up for a new condo project located in Burnaby (Kingsway/Willingdon Ave). Line up may start as early as weds/thurs night. Grand opening is Saturday February 19, 2011.
Warm beverages and washrooms will be provided by the developer.
Shifts are determined on how long you would like to stay. (preferably 8hours+)
Get paid cash quickly for sitting in a line up!
E-mail me your phone number + e-mail for more details. job-syk6p-2212992997@craigslist.org”

’29’ at VREAA told us of other online ads offering to pay people to line up:
“need help to line up, tonight, urgent, contact
Shirley 7788633870” [link]
“urgently required, night shift persons, 7, 8pm – 6am
contact 6047159389” [link]
“Builders Assoc CNY Meetup, Feb 19, Bonsor Community Centre, 6550 Bonsor Ave, 27:30-22:00 hours, 6048888888” [link]
[It remains unclear to us whether the parties advertising for people to line-up were prospective buyers, realtors, or parties directly or indirectly interested in creating a media buzz. -ed.]

29, offered further info, in a series of comments at VREAA 16 Feb 2011 – “One can earn $100 lining up during the day and $120 night. 1 guy said he made $1000 to line up 3 days for a friend. Naturally hiring ad for this role is in Chinese. A few genuine buyers. Most are flippers.
Latest. Prospective buyers must produce IDs and register in person; they will then get a number like in a doctor’s waiting room. Further more they cannot transfer their option to purchase to a 3rd party. If that is true, kudos to the sales organizer to bring in some sanity to this fracas.”

[Photos sourced here.]

Global TV covered the line-up as news, 16 Feb 2011

“Remember when people were actually lining up to buy apartments in buildings that hadn’t even been built yet? Well, it’s happening again today despite what is supposed to be a slower condo market in the lower mainland. People camping out for a shot at a pre-sale in Burnaby for a new tower that won’t be completed for years.”

[Note project name prominence for the Global piece. -ed.]

“This building, you know, very good at 450, houses they go for 1 million, one point four, you know, that’s very good (laughs).” – Person in line-up:

“Metrotown is a very strong area in terms of transportation routes, it’s got a lot of infrastructure in place, as well as it’s at a critical mass in retail as well as housing, so I can see that as being attractive for buyers.” – Cameron Muir, BCREA [Introduced just as an ‘economist’ by the voice over. -ed.]

Announcer: “…and as an investment.”
Interviewer: “Are you going to live in this building?”
Guy in line-up: “Uhm…I have no idea right now..because that depends how the economy goes.. because it’s completed three years later… who knows, hey?”

Jen, somebody who works nearby, as quoted by Garth Turner, at greaterfool.ca 16 Feb 2011 –“When I went to work Tuesday morning I noticed a bunch of people at the empty lot and wondered what was up.  Through the morning, the crowd/lineup grew.  At noon, I noticed the porta-potty in a parking lot behind an adjacent building.  An hour later it was gone (I kinda wonder if we should call the employment standards people – after all, I think it was in the job offer).  The line grew by 50% from what was there at 9:30, so at 2:45 when I left, the lineup stretched beyond the length of the adjacent building.  By 4, they were erecting tents (like very nice party tents –  fully enclosed) for the people in the lineup exposed to the rain. When I went back to work at 8 there were flood lights for the people now in the tents.  And alas, when I left at 10, the floodlights were extinguished, but several police cruisers were in attendance.” “A co-worker went out and spoke to the people in the lineup at lunch.  When asked what they were in the lineup for, the first two people in line didn’t know.  A little further down the line, someone said they were waiting to buy a condo.  When asked if one of them were going to buy a condo, the guy said no, but his friend beside him was going to buy one.  Asked if they were getting paid to stand in line….answer…no!  Upon leaving the project with a loud comment from my co-worker  “hope you guys are getting paid well for this”,  the answer from one “not bad, not bad”.

Alex, at greaterfool.ca 16 Feb 2011 11:22pm, posted a letter that he has sent to Global BC TV –
“Regarding your item on the evening news tonite where you gushed over the line-up for that condo development in Burnaby: Are you aware there was an advertisement on craigslist this week offering to PAY people to stand in that line? That’s right – either the developer or the marketing company created a FAKE lineup. And here you are covering it as “news.” How reprehensible is that? Only as reprehensible as your coverage last week of that trumped-up helicopter tour over White Rock, where you wrongly intimated that mainland Chinese were flocking to the area when in fact it was simply a desperate marketing measure of a failing condo tower.
Now, I am aware that the local real estate mob (and I use that word knowingly) pays what must be a handsome fee to advertise on your station. In fact, most of your segments tonite were “sponsored” either by Re/Max or a mortgage broker. Coincidence? Hardly.
So tell me: In this climate, where Canadian families have maxed their credit, where real estate prices are some of the highest in the world, where the income to household debt-servicing ratio is in excess of TEN (an all-time record, by a long shot), where even the governor of the Bank of Canada has begged Canadians to STOP SPENDING, and where mortgage restrictions are continuously being initiated to stop the obvious insanity created in part by mainstream media lies, are you knowingly committing fraud? Because this spot tonight, along with the White Rock piece last week, most definitely weren’t “news.”
If you have even an ounce of shame, you’ll at least admit to me in a reply that you were either: A) Duped beyond all reason, or B) Lying and committing fraud. So, Global, which is it?”

Brian at greaterfool.ca 17 Feb 2011 3:48am – “I heard from someone that knows someone that works for the developer that they have no knowledge of anyone being paid to stand in the lineup….I find that very hard to believe.”

Peter Pan at greaterfool.ca 17 Feb 2011 3:56am – “A journalist from the Vancouver Sun asked me to provide him with the Craigslist ad… I told him it was pulled soon after appearing on this website…”

Burnaby Boy at greaterfool.ca 17 Feb 2011 4:31am– “As of midnight the line ups of people at the Burnaby condo development have all gone as have the tents and security guards. I guess getting on the six o’clock news did the trick.”

Supersogs, at vancouvercondo.info 16 Feb 2011 11:47 am, reprinted a note from Bosa regarding the line-up.. they have changed to a system of “a sequential list of interested parties”: “While we knew that the interest in Sovereign was very healthy, we were surprised to find last night that over 125 clients had elected to begin lining up for our sales event this Saturday. While we anticipated that there would likely be a line-up, we could not have anticipated that it would begin forming so soon, and as a result have elected to modify our plans for the coming days.” [Where did the tents come from? -ed.]

—

UPDATES:

1. Bosa announces, on the day of the sales, 19 Feb 2011, that the project is “100% Sold out”:
“We’re thrilled to announce that
Sovereign by Bosa Properties is 100% sold out!
On behalf of Bosa Properties, we would like to extend our gratitude and appreciation to all of our new homeowners and everyone who came out to see us at the Sales Centre throughout the past weeks.”

2. Flip attempts appear within hours on craigslist:
“Date: 2011-02-19, 8:06PM PST
Reply to: hous-ue4zb-2224133573_at_craigslist.org
Any body [sic -ed.] who is interested in an assignment please contact me.
I have 3 units ready for signing
2 one bedrooms
1 studio
Adding $25k assignment to original pre open day price. (first 80 units)
If you are interested – you need to be quick cause these will be signed over on monday or tuesday (no assignment fees if done in the next few days)
SOLD OUT BUILDING ( in one day)
Basa http://www.bosaproperties.com/sovereign/
Email with phone number and cash needs to be ready.
Thanks
PostingID: 2224133573”

3. Follow up breathless infomercial from Global. Archived by Greenhorn at youtube: Condo Boom in Vancouver
Including great quotes:
“We are still remembering the two years ago, the economic crisis.. you know.. people don’t have a lot of confidence.. those monetary products… but, as a real estate, you’re buying something” – Sunny Lee, Royal Pacific Realty
“And a quick footnote to the story, if you were interested in buying a condo at The Sovereign… it is now Sold Out.” – Announcer (with, arguably, ‘told-you-so’ delivery)

Speculating With Vancouver SFHs – “He invites investors to either to buy the properties at a certain price, or join him to build where investors are either guaranteed 20% return, or 50% profit.”

The recent ‘Richmond Review’ article about a ‘miffed’ Richmond seller who’s former property was immediately put on the market as a flip, stated:
“The company behind the deals, New Land Strategies Corp. [owned by Ze Yu Wu], 703-6081 No. 3 Rd., has upwards of 10 similar Richmond properties currently available.”

unicas at RE Talks has this to add 15 Feb 2011 9:28pm–
“I wanted to post about this guy before this article came out. And he is not alone. This is how he works. He has full page ads on cheap free Chinese newspaper that are mostly read by mainlanders. On this ads, there are about 10-12 properties, mostly in richmond, some in vancouverWest . He put specifics why these properties are good investment, including big lot, close to good school etc. On the ad, the guy offers $5K tips to lead about properties fitting into such specifications that someone wants to sell. He invites investors either to buy the properties at a certain price, or join him to build where investors are either guaranteed 20% return, or 50% profit. Investors will have 50% of title of the property. For each of such joint investment, the cash requirement is around $500K. Apparently some of those properties have been taken, he would put a taken flag on the ad, like realtors put sold sign.
There are other chinese groups doing the same thing. Only difference is percentage of payout to investors. And there are ready buyers for such houses. As I mentioned in another thread, most builders are asked about the houses they build in Richmond before completion.
Many parts of richmond is like construction site now, with many house being built. It is crazy, like gold rush.”

“This is what it’s like dealing with newbie landlords.”

Canayjun at greaterfool.ca 12 Feb 2011 4:47pm – “The numerous first time landlords, that arose from the enormous level of spec buying in past two years, are an interesting bunch. They have no clue what they are doing. The four I have negotiated a lease with recently, all believed they were going to buy in and flip the property for a quick profit of $20,000 to $50,000.

None of them knows how to be a landlord. One gave back the damage deposit, not mine, the previous tenant’s, (minus $200), then tallied up the costs to repair the damage (which totalled $600). He was informed by his realtor (who did a market evaluation for him), that he rented us the condo far below market value. I thought it was a good deal. And apparently it was a good deal. Good for us.

Another newbie landlord didn’t know how to fill out the rental agreement forms. I had to do it for them. Another landlord thought they could store whatever they wanted in our back yard, after we moved in. We actually got into arguments over it. They didn’t understand that the house and yard was now ours, not theirs.

Another landlord increased the rent by the allowable amount in BC, then threatened to kick us out if we didn’t sign another one year lease–totally illegal. When he realized he couldn’t kick us out for not signing another lease, he offered to reduce the rent to its original amount if we signed another lease.

Another landlord thought he would store dump trucks on the unused/unoccupied portion of the property on our current acreage rental. I already shut down the dump truck storage (30 trucks) that was beside us on the neighbours property by complaining to city hall. So our landlord thought he could move in 50 dump trucks and store them on the other side of us to make some money. Never going to happen.

Another landlord deposited our rent cheque into the wrong bank account, apparently he has several bank accounts, and then demanded another rent cheque to cover the “missing” rent from August. It took five hours to make him understand he wasn’t missing any rent.

This is what it’s like dealing with newbie landlords.

It’s so much better to rent through a management company. On high end properties they are very, very willing to fix things quickly. And we are currently renting three high end properties.

But these are all minor worries really. My two big worries are if they are going to sell at lease renewal time and whether they might end up in foreclosure.
In reality, my worst case scenario is having to move before I want to, and even that is not the end of the world.”

Global BC TV Shameless Helicopter RE Infomercial – ‘Waterfront’; ‘Good School’; ‘Chinese Buyers’ A ‘Powerful Force’; Metro Vancouver RE ‘Cheap’

The US has ‘Helicopter Ben’, here in Vancouver, we have ‘Helicopter Cam’, as in ‘Cam Good’, local condo peddler, who took local realtors who have mainland China marketing connections on a promotional helicopter flight over White Rock. Somehow a Global TV crew happened to come along for the ride.
This all came just one week after tincup, on an earlier thread at VREAA, had presciently commented: “I think the next anecdote will be that rich asians are rappelling down at night from black helicopters with duffle bags of cash, signing a few docs and then zooming away in jet packs.” [1 Feb 2011] Well, the helicopters weren’t black, but the gist and the intention of the story were precisely as tincup predicted. The Global piece has been very extensively discussed at other sites, but we feel we’d be remiss to not document it here. It reads like a shameless infomercial. Possibly it’ll mark some kind of ‘high point’ in the fever.  Here follows visual and quote excerpts from ‘Chinese Buyers Flock To White Rock’, Global BC TV network, 9 Feb 2011 [thanks to Greenhorn for the video archive] –

“Could this be a sign of the times?
While Chinese buyers have long been a powerful force in places like Richmond, it looks like they are now casting their investment nets even wider.”

“These aren’t your average group of helicopter riders. They are on a mission – To find property for their clients back in mainland China.”

“For five thousand bucks today ‘The Key’, a real estate marketing group, invited Vancouver’s top mainland China realtors to sell their clients on White Rock”.

“White Rock is a very good location.” – Realtor voice over

“I like the area. And I like the school. And also the environment here.” – Lui Wei

“Waterfront view, you know, actually, yes, very good school, a lot of Chinese, they’re looking for, good school for their kids.” – Chris Chan

“In Vancouver, freehold land, you own it forever. But in China, it’s not freehold, they are leasehold, … just like the condominium in UBC, you have to return the land to whoever owns it. This is a new concept to them, and they like real estate here.” – Chris Chan

“Finally for mainland Chinese, metro Vancouver is what Phoenix or Arizona is to Canadians right now… Cheap. Today’s trip netted the marketing group about a half dozen sales.” – Voice over

—-

ADDENDUM:
Further information from unicas at RE Talks 10 Feb 2011 – “From a translation of a Sing Tao article: The same company that invites those chinese realtors on helicopter tour to white rock is setting up display centre in downtown beijing. The centre will open in March to sell Avra, a 17 story condo project. The centre will employ 6 people. Over 50 of the 117 are already sold in Beijing, before the centre opens. Big draw to the Chinese, Semiahmoo which offers the IB course.  Of all the real estate sales in the city of White Rock for the past 6 months, 75% are by the mainland buyers.”

“He said that his agent told him that the Chinese government is telling their people they should invest in Vancouver.”

ams at VREAA 8 Feb 2011 9:24am – “I was at a birthday part on the weekend, one of the people is putting up his condo for sale because he wants to move to a different neighborhood. We got talking about real estate and he said that his agent told him that the Chinese government is telling their people they should invest in Vancouver and that investing in Vancouver is an authorized investment. I pushed back on that idea and said that China instructing their citizens was pretty far fetched.”

We’d agree, the idea that the Chinese government is encouraging citizens to buy up Vancouver is a bit of a leap. This is another interesting anecdote as a record of what locals are telling themselves as they peddle RE to one another, and as they overextend themselves further into RE.
Would the above “move to a different neighbourhood” involve an increased exposure to RE? It usually does, particularly when the protagonist is speaking that kind of bull. -vreaa

B.C.’s household debt-to-income ratio is 160 per cent; B.C. is the only province with negative savings rate

From a report from TD Economics, cited in the Vancouver Sun 9 Feb 2011 –

B.C. households are the most vulnerable in Canada to interest rate hikes or an economic downturn. B.C.’s household debt-to-income ratio is 160 per cent, far above the Canadian average of 127 per cent. B.C. is also the only province to have a negative savings rate, as every available dollar is directed toward mortgage and other debt or living costs.

Higher interest rates over the next few years threaten to leave as many as one in ten households in B.C. in a position of financial stress. The 10-per-cent figure is based on TD’s projection of gradual rate hikes from the current one per cent to three per cent by the end of 2012.

“On the plus side, rapidly-appreciating home prices in the province has left the debt-to-asset ratio — a metric of household leverage — below the Canadian average.”

Spot The Speculator #27 – “She is a lawyer and is quite set financially and probably did this flip for a bit of fun: well, she got ~150k clear.”

Anonimi at VREAA 8 Feb 2011 10:42pm – “My aunt bought a condo in UBC south campus three years ago (pre-sell) – she is a lawyer and is quite set financially and probably did this for a bit of fun: well, she flipped and got ~150k clear (tax not inc;): for all you race profilers out there – the condo is almost 100% chinese, the creame de la creame of mainland China.”

Story of a local speculator flipping a presale for a profit of (150K – taxes/costs), and, it seems, for the pleasure of the diversion. Reminds us of the statement from Tracie McTavish, president of Rennie Marketing Systems, “Real estate is like a sport here.” … Extreme condo flipping. -vreaa

Is Vancouver A Fringe Of The China Property Bubble? – “It sounds like a criminal or insane or whatever you want to call it, a total misallocation of capital.”

Possibly. If so, what are the implications? Could run up even further, could blow up in a spectacular fashion. See this interview with Jim Chanos, currently short China, from FT.com, 1 Feb 2011.

Quotes:
“China is in a very major property bubble”
“70% of their GDP is in fixed asset investment.” … [and this is NOT from infrastructure development. For instance, high speed rail is only 2% of that 70%.]
“At the peak of the bubble in the US, fixed asset investment was 16-18% of GDP, of which 6% was property.”
[The bubble is affecting tier 2 and tier 3 cities as much as Beijing and Shanghai.]
“Prices relative to incomes are in nose-bleed territories by Western standards.”
“A lot of the property that is being built is not affordable by about 99% of the Chinese population”.
[Interviewer: “So it sounds like a criminal or insane or whatever you want to call it, a total misallocation of capital.”]
“One of the bull cases is that this will deflate gently, and that the Chinese economy will seamlessly move to a consumer-led burgeoning middle-class economy… The problem is that consumers are less and less of this economy, as the property bubble has gone on.”
“Anytime you take something that is 70% of your economy and rein it in, history tells us that usually the risks are to the downside… but, who knows, they might do it.”
“The Chinese bankers do see problems, you can see it in their pronouncements.”
“The Western investor is getting a lot of opportunities to buy into this boom, and we’re taking the other side of that trade.”

“There are lots of things that people say about China that, when you examine the data, falls apart”.

Flip Attempt – Potential $233K Profit In 4 Months

Crash at vancouvercondo.info 2 Feb 2011 4:19pm –
“Here’s an attempted flip:
4842 Victory Street Burnaby MLS #V861597 Sold Sep22/2010 for $655,000 now listed for $888,000. House is a teardown or in need of major renovation. Was an estate sale originally in 2010 I think.”

That’s a potential profit of $233K in 4 months. And if we take into account the forced leverage that comes with RE speculation, calculate at a 10% downpayment, that’s a return of 350%. See why a housing bubble looks so great on the way up? It’s like gambling! It’s like crack cocaine! – vreaa

Disillusion Row, Numbers 1-12

All of the following  anecdotes are from a single recent thread at vancouvercondo.info. They are archived here as a record of some of the sentiment being expressed at this juncture. Our housing bubble is at the very least profoundly distracting. Worse, it is scaring away human capital and putting our local economy at risk of implosion. -vreaa

1. JordanClark January 24th, 2011 at 3:56 am–
“This market is insane, the longer it goes on the worse off everyone here will be in the long run. The prices just flat out don’t make sense, there is no justification and people need to realize huge debt comes with real risks. People who got in at the right time might be better off but they do so to the detriment of the younger generations, who will be relied on to pick up the economic torch some day. What will happen when they aren’t there or still up to their eye balls in debt? We’ve been waiting for years and have pretty much given up on greater Vancouver. The market here will collapse some day, but that whole process will probably take many more years, people here are extremely stubborn about the eternal value of real estate and will take nothing before reducing prices. My kids start school this year, we need to be in a home with a yard, and stability. The condo life sucks. Luckily I’m a dual citizen so I’m in the process of sponsoring my wife and moving down to Washington State. I wish this was an easier option for more Canadians/Vancouverites because I think it would offer great relief to so many other families. We’ll buy a nice 3-4 year old house, 4-5 bedrooms, 2500+ sqft, nice 8000+ sqft yard, on a nice cul-de-sac within a few blocks of school for maybe $300k. From saving all these years we can put 50-75% down, pay it off in 10-15 years while still making significant retirement contributions. I’ll be able to retire in my 40s. Adios Vancouver.”

2. Vancouverite January 24th, 2011 at 7:03 am–
“Count me among those who have had enough. I was born and raised in Vancouver. I am at the very top of my very high earning profession here, like my husband. We own a SFH on the west side (it is respectable by Vancouver standards but pretty modest by the standards of any other city) and we are almost mortgage-free. While we would like to buy a bigger house since our kids are getting older, we won’t. This bubble is certain to burst sooner or later and we work way too hard to throw our money away competing with buyers who are up to their ears in temporarily cheap debt. We know how long it takes to save $100K. Although our extended families are here, we are actually giving serious thought to moving elsewhere in Canada or even to another country. We could sell our house today and buy a nicer house in a nicer neighborhood mortgage-free, with lots of cash left over for savings. There would be some initial sacrifice professionally, but we’d probably earn more in the long run. Even if we didn’t, we don’t really care if it means a better life for our kids. Which brings me to my biggest concern, Vancouver’s future. There is almost no significant business left here that is not connected to real estate in some way. Why would you bother trying to make a better widget when you could make more money more easily by developing, constructing, or marketing $1m townhouses? Even if you wanted to make a better widget, why would you do it in Vancouver, where it is difficult to attract professional talent because of the exorbitant cost of living? When this real estate bubble collapses, and it will, I think it is going to be disastrous for this city, which has put all its eggs and then some into one basket, and for its people, many of whom depend upon rising home equity for their spending and have forgotten what actual work and business looks like. I think I might like my family to be somewhere else.”

3. LY January 24th, 2011 at 7:12 am –
“I rented for 5 years in Richmond waiting for house prices to correct. Everytime its about to go down, the gov’t will intervene. As long as mortgage terms in Canada are lax and rich immigrant’s money continue to flow in, I don’t see any sizable correction in housing prices especially in bubbly vancouver. I gave up on Vancouver, move to Toronto and bought a house. Adios Vancouver too.”

4. pricedoutfornow January 24th, 2011 at 9:04 am –
“How has RE affected me? Well, for one, I have a whole pile of cash that could potentially be used for a healthy downpayment, if prices were what they were in 2001. If I were to drop that on a downpayment today, it wouldn’t get me very far. Plus the cost of carrying the mortgage would make my living costs go up by over $1000 a month (more when interest rates rise!). For another thing, every family gathering with my SO ends with questions from the inlaws as to why I haven’t bought yet, why am I throwing money away on rent. No matter how often I explain I’m actually SAVING money, they just harp on about how “Real estate always goes up.” Talk about zombies. I do wish I had a dog though, which would be a million times easier if I had a house with a yard. I can’t wait for this bubble to pop.”

5. Vansanity January 24th, 2011 at 9:09 am–
“My inlaws saw that piece on CBC and they called up in a panic, “oh my God prices are going up again, what are you waiting for?” I told them, hey, if you want to buy us a place for $1M I won’t stop you. In other words, put your money where your mouth is, cuz I have, that’s why it’s in the bank.
My wife and I ideally would like to have a place in East Van or Burnaby but we refuse to live “house poor” as some of our friends and family do. I haven’t convinced my wife to move away, but the longer this goes we might eventually take off and move to sunnier pastures. You know the saying the grass is always greener, well when it comes to real estate and money and Vancouver to the rest of the world, it might be true.”

6. VancouverFiveOh January 24th, 2011 at 11:32 am–
“I have been bearish since 2006. I’m a logic and math type and that has served me well in my profession but perhaps not so much when it comes to housing. I could have flipped a bunch of west side homes by now, right?
Count me among those who are seriously considering leaving Vancouver. I was born and raised here but am tired of this city and it’s “best place on earth” attitude. I’m also tired of the rain. Today sucks.”

7. Dan in Calgary January 24th, 2011 at 11:45 am–
“I was born in Vancouver, left and moved back in 1975. I spent more than 30 years of my adult life in Vancouver, leaving for Calgary in 2007. Vancouver’s rain was an irritation to be tolerated as long as the city had charm, class and a friendly, laid-back kind of atmosphere, with a small enough population that one could actually enjoy what Vancouver offers. But that all changed, particularly beginning when the Olympic hype started. Then the rain became intolerable. Today Vancouver is mere hype.”

8. /dev/null January 24th, 2011 at 11:56 am–
[In response to “Let’s poll how many would have said: I wish I bought a property a few years ago.“]
“I almost did but I’m glad I waited. Instead we both moved to part-time work – me to finish my degree and my wife to spend more time with our kids. With a mortgage we couldn’t/wouldn’t have done that. Now we can actually afford a house instead of that condo we were looking at, despite the run-up in prices. So we chose to invest in increasing my employment income (and raising our kids) versus real estate. So far I’m happy with the decision. Don’t assume that bears are just sitting around with their life on hold because they haven’t yet purchased a home.”

9. exWestEnder January 24th, 2011 at 1:46 pm–
“We moved to Paris (France) to see if it could possibly hold a candle to The Best Place on Earth. My partner got a transfer to the Paris office in Sept 2008. We moved in November, and man, we were we ever grateful that, as renters, we did NOT have to sell in that particular RE market. So now we’re enjoying all those French clichés: 7 weeks vacation, job security, cheap wine, amazing food, and a city where Lotsa Stuff Happens. … If our wanderlust fizzles and the Van property market ever returns to earth, we can come back knowing we already have a generous down payment….if we want to buy. On the other hand, when I remember the rain I might opt for putting it towards a farmhouse in the south of France instead….”

10. Patiently Waiting January 24th, 2011 at 1:59 pm–
“I have almost a million reasons to cheer for high real estate prices. They are the dollars my parents house is “worth”. I will inherit the house which my parents own outright. But I remain a bear because I hate what’s happening to this city culturally, feel sad for families who are struggling because of this, regret what this is doing to the economy (and my chances of getting decent work), want to see every real estate agent and mortgage broker humbled in a serious way, and logically know this can’t go on.”

11. painted turtle January 24th, 2011 at 3:05 pm–
“The real estate mania had a great positive influence on our lives. When we moved to Vancouver in 2005, as a 35 year old professional couple with 2 kids, we did not question our future: 1) Find good/secure jobs 2)Buy a house with a yard and be in debt for ever. This was supposed to be the way to happiness. Well… by the time we both had a full time job, house prices were too high. So we looked for a great rental solution (took some time). Now the kids are old enough they do not really need a yard anymore. We realized that since we are renting, we are making more money than needed. We could both put a break on our workloads and spend more time on hobbies we first thought would have to wait for retirement age. We can take care of our health, spend time with our teenage kids, take extended vacations, live a slow life. We also save money, and can look for ethical investments rather than being obsessed with ROI. We are now exploring exciting career moves/education we could have never thought of before. Somehow, it feels like being in my mid 20′s. By the time house prices will go down, our kids will be grown up, and the need for a house will have vanished. Anyway, mobility/freedom is our lifestyle, and I am happy we did not give up on that. So I would like to thank everybody who bought a house in the last six years for preventing us from entering a system we do not believe in, especially since we were about to be lured into making a wrong step. People who confuse wealth for happiness might no understand us, but fortunately, not everybody must have the same philosophy of life.”

12. YLTNboomerang January 24th, 2011 at 6:57 pm–
“I’m born and raised Vancouver and have had the opportunity to live for a few years in Germany/Belgium/Switzerland/US. I’ve been back for about 6 years now and have been a renter since selling in 2007. Does the irrationality make me want to give up and buy? NO WAY! I learned my lesson once already during the dot.com boom when I thought “maybe things are different now and the old style valuations no longer hold?”. Well, the result of that thinking lost me a fair amount on the market. I see the market today (more than ever) as a bubble and thus will never buy here until things come back in line with fundamentals. We’re happy renting and likely will do so when we move to Calgary in two years due to a planned advancement. I’ll keep an eye on Vancouver real estate and who knows, I could maybe even buy a place for retirement in the future if prices normalize.”

—
…and one bystander:

1. Best place on meth January 24th, 2011 at 11:06 am–
“I have no intention of ever buying real estate in Vancouver. I am however enjoying watching this one-industry city commit greed induced suicide. This Ponzi scheme is mere entertainment from my viewpoint.”

Extra! Extra! Read All About It! – Pablum From ‘The Vancouver Sun’ Lulls Locals

What motivates ‘The Vancouver Sun’ to print an article like: ‘Real estate market calm expected to follow hectic 2010 in Metro Vancouver; Home sales forecast to increase modestly across B.C. as prices stabilize‘, 27 Jan 2011?
It contains no ‘news’ or analysis whatsoever. It consists of hopeful statements regarding price direction from a family who have recently purchased a home, and reassurances of stable markets and price increases from BCREA, CMHC, UBC’s Land Economics department, and a realtor. There is no mention whatsoever of any downside risk.
The only conceivable purpose of this article appears to be to lull current owners and potential buyers into believing that the Vancouver real estate market is stable, cosy, and benign. It’s an advertisment dressed up as a newspaper article. -vreaa
[hat-tip to Mr. Poppinfresh at VREAA for pointing out the importance of non-articles such as this one.]

“Carrie and Mike McDougall — with their daughter Kylie, 3, and son Colton, 4 — moved to British Columbia from Alberta recently and bought a new house in Maple Ridge. They were comfortable with the price they paid and are expecting prices will go up in the next year, as are experts across Metro Vancouver.”
“Hopefully, it was a good time to purchase,” McDougall said in an interview.

Other excerpts:

“There will be a much more gradual increase in consumer demand and less volatility. There will be more stable market conditions this year.” – Cameron Muir, chief economist for the B.C. Real Estate Association

“We’re calling for a three-percent price increase in 2011.”– Robyn Adamache, senior market analyst for Metro Vancouver with Canada Mortgage and Housing Corp.

“[I’m] seeing an uptick in buyers who believe interest rates are heading north. [I] believe there will be a modest increase in both pricing and demand this year.” – Ron Antalek, a realtor with ReMax Ridge Meadows Realty.

Tsur Somerville, director of the centre for urban economics and real estate at the University of B.C.’s Sauder School of Business, said he doesn’t like forecasting the future, but nevertheless believes that 2011’s real estate picture will be largely determined by the speed of the recovery and the Bank of Canada’s action on interest rates.

“As frustrating as it may be” on the Wrong Side of the Bubble, the Bearish Position Remains Right

blammo at VREAA yesterday [24 Jan 2011] taunted the Vancouver RE bear ‘Choir’ for having been wrong for so long –
“I often wonder if more people have been hurt by bear blogs (selling too soon/not buying), than will benefit from them due to future market corrections.”

This is a familiar and expected criticism. We acknowledged to blammo that it has indeed felt silly being wrong for so long, but pointed out that this is simply what happens in bubbles. Bears look silly until they suddenly look right. It is easy to point out that anybody could have made a fortune flipping condos or westside lots, but we know that all markets are made up with an almost infinite number of coulda-shoulda-woulda situations, in retrospect.

Despite being wrong for this long, our outlook remains the same. And, no, this is not out of stubbornness, or out of insanity, but quite simply because there is no information out there that causes us to change our view. The vast chasm between Vancouver RE pricing and fundamentals remains astonishing. In fact, we see even more downside for the market as it goes from very overextended to uber-overextended. Fifty percent price drops become even more likely.

David Rosenberg, by coincidence, has some relevant comments in his ‘Breakfast with Dave’ missive today [25 Jan 2010]. He is, of course, talking about the currently overextended stock market, but the principles are very similar:
“As frustrating as it may be to have been focused on risk-adjusted returns as opposed to gross nominal returns, to have been managing the downside risks and preserving capital rather than chase a mostly speculative run, it is more advantageous to be positioned tactically to take advantage of any corrections or price dislocations that occur over the near- or intermediate-term that are part and parcel of all markets, especially ones that have over-run the inherent fundamentals.”

There you have it. That is why sensible managers of their own funds have not bought into the Vancouver RE market for the last 3, 5 or even 7 years. They have seen how much our RE market has ‘over-run the inherent fundamentals’, and have decided not to participate in a ‘speculative run’ with a significant portion of their own net worth. This is not to be confused with risk aversion. All good investors and speculators have to take risk. But the ones who do well through their investing lifetimes are the ones who take calculated risks, when the odds are on their side. Pointing out that people have made money in Vancouver RE in the last 5 years is like pointing out that a cowboy walked up to a roulette table, put all of his money on a number, and his number came up. And then another cowboy did the same thing, and another. Does this change the way one approaches roulette? Do you line up with the cowboys? No. Sensible people avoid roulette altogether as, over the long term, you can be assured of losing.
Yes, it is ‘frustrating’ for bears as the RE run continues, but memories of this frustration will pale into insignificance when compared with the relentless and ongoing pain of being on the wrong side of the bubble collapse. That collapse has the potential to wipe out many, and to severely impede the financial health of even more for decades. Not to mention the broader adverse effects on our society, that we will all be forced to sustain.
Until the price drops commence, we’ll admit we look foolish. But we fully expect that to be a temporary position.
-vreaa

“Units here are worth $1 million. We put our life savings into this. I’m very angry and upset. If I had known it was going to be a hospice, I wouldn’t buy it for half the price.”

Excerpts from ‘Angry Asian UBC condo owners to protest ‘bad luck’ hospice‘, The Province, 12 Jan 2011 –
“Dozens of angry Asian residents of a posh, University of B.C., highrise building aim to stage a placard-waving protest rally to protest a 15-bed hospice being planned next door. “We cannot have dying people in our backyard,” said rally organizer Janet Fan, Wednesday “It’s a cultural taboo to us and we cannot be close to so many dying people. It’s like you open your door and step into a graveyard.”  Fan lives on the 17th floor at Promontory, at 2688 West Mall, near Thunderbird Stadium. …
Fan said 80 per cent of the residents of her 18-storey building are Asian and are strongly opposed. “Units here are worth $1 million,” she added. “We put our life savings into this.” She said residents are worried the hospice will have a negative impact on their property values. …
Qing Lin, who bought a Promontory apartment for $900,000 almost a year ago, said she and her seven year old daughter will have nightmares if the hospice goes ahead. “We believe that people dying outside will bring us bad luck,” she added. “I’m very angry and upset. If I had known it was going to be a hospice, I wouldn’t buy it for half the price.” …
Sharon Wu, chairwoman of the University Neighborhood Association said 60 residents came to a UNA board meeting Tuesday. “The UNA respects cultural beliefs,” she said. “UBC is planning to address the concerns of the residents. It’s a very emotional and sensitive issue.”

UPDATE: 13 Jan 2011 Global BC news clip on this issue archived at youtube by GreenhornRET, ‘Ghosts To Decrease Real Estate Values’:

UPDATE2: Image of Promontory owners with petitions:

“Think about how fortunate many have been to have been involved in RE in the last decade. I mean everyone: realtors, builders, plumbers, electricians, mortgage brokers, inspectors, etc… you name it. Not a bad gig. Many people/families have enjoyed good employment.”

thinktom (a Vancouver realtor) at RE Talks 7 Jan 2011 4:33pm –
“I’ve got a million [regrets about the RE market]. I remember in 2000/2001 watching the market start to move.
I went to see Ozzy Jurock speak in 2001. He said if anyone has balls, they’ll buy 5 condos right now and they’ll be rich in a few years.
I didn’t buy 5. But I bought 1.
My mother and I purchased at 1277 Nelson for $158k a year later I think. Concrete 1 bed w views. Rented it out furnished for a few years and did well. I loved that building and watched 2 beds go for $250k. I shoulda’ bought every unit in the place as they came up.
I know a house near Commercial/12th. Got pulled off the market and sold privately….. for $225k.
I bought a house at Fraser/23rd for $389k. Sold for $815k. I should have bought 5.
I sold some clients in SOMA Lofts. The D plan was a one bed plus den but I told my clients they could easily turn the den into another bedroom. They made a killing. 2 of those D plans sat on the market for a long time. The TH’s were also $315 and wouldn’t sell. *sniff* *sob*
West end was giving away condos for years. SO close to the beach and yet the prices were lower than almost any city in the world with that kind of location.
But even in 2003, people were talking ‘bubble’. I had a client that sold his East Van house for $289k due to ‘the bubble’. He stubbornly refused to ever buy back in as well, convinced it was still coming. Maybe it is???
I never should have sold anything I’ve ever bought and should been renting ’em all ever since.
I prefer to think about how fortunate many have been to have been involved in RE in the last decade. I mean everyone, not just the realtors. I’m talking builders, plumbers, electricians, mortgage brokers, inspectors, etc… you name it. Not a bad gig and many people/families have enjoyed good employment.
Of course, hindsight is 20/20 for all this stuff. I remember the Google IPO. I thought ‘I’ll drop $10-15k. What the hell I thought. I really like google and use it all the time’ My financial advisor (a serious pro) thought it was overvalued at $105. So I didn’t *sob*”

Comment:
1. Yes, hindsight is 20:20. The past is the past. You could make an infinitely long list of prior investments/speculations that we can now see would have done well. Look at a long term chart of any market whatsoever and they leap out at you. ‘Regrets’ don’t really mean much.
2. The ‘gig’ that employed and enriched a minority sector of our society has been based on the spending into the economy of vast, vast amounts of borrowed money. It has been the result of a debt fueled binge. We have not yet begun to really pay for this artificial boom.
-vreaa

Jay Bryan, Montreal Gazette – “Homes are resistant to big drops in value. … It’s hard to find a reputable analyst who predicts anything other than mild fluctuations in housing over the coming year or two.”

Excerpts from ‘No solid basis for scary speculation’ by Jay Bryan, Montreal Gazette, 30 Dec 2010 –
“One of the biggest business stories of 2010 was one that never happened: the disastrous Canadian housing bubble and crash that never came to pass.
Of course, we know this now. Canada’s hot housing market has settled down without any serious slump in either prices or sales. It’s hard to find a reputable analyst who predicts anything other than mild fluctuations in housing over the coming year or two.” …
“The roots of bubble hysteria are understandable. After the terrible experience of the U.S., it made sense that many would be hypersensitive to any evidence that something equally disastrous could happen here. What’s not so understandable was that journalists working for some of the best newspapers in North America would give credence to such a hare-brained idea without finding any evidence that it was actually happening.” …
“As investors become more or less optimistic, the price of an asset -stocks, commodities or real estate -constantly moves up and down. Sometimes it’s too high and ripe for a fall -but that’s not a bubble. And unlike stocks or commodities, homes are an asset that’s resistant to big drops in value. Many owners are perfectly willing to wait if they don’t get a satisfactory price.”

It’s worth taking a look at the entire article.
Our comments:
Complacency comes before a fall.
Labeling concerns about a bubble in the Canadian RE market as “hare-brained” and “hysteria” are examples of bull hubris.
A home is by no means “an asset that’s resistant to big drops in value”.
How can anyone seriously write that while witnessing so many examples of housing prices plummeting around the globe?
It reminds one of the ‘scientist’ centuries ago writing that nothing heavier than air would ever be able to fly (while birds settled on his windowsill).
And folks, when “It’s hard to find a reputable analyst who predicts anything other than mild fluctuations in housing over the coming year or two” – Run for the hills! This kind of market complacency always, always, predicts coming volatility. The evidence is overwhelming that the moves will be to the downside.
-vreaa

[Some of Jay Bryan’s passages from this article will also be archived in the ‘What Bubble?’ and ‘Bull Hubris‘ sidebars.]

[Update 2 Jan 2011: For an excellent and comprehensive dissection of the Jay Bryan article, see ‘Who’s the ‘hare-brained’ one? More hot air from perma-bull Jay Bryan‘ by Ben at financialinsights.com.]

“I grew up in this town and am old enough to remember when False Creek still had pulp mills surrounding it… Vancouver just gets uglier and more soul-less with every passing year”

interested at VREAA 30 Dec 2010 4:49pm – “I grew up in this town and am old enough to remember when False Creek still had pulp mills surrounding it and working class people raised 4 kids in their East Side AND West Side bungalows. I’ve always hated the hubris of “the best place on earth” and see it as yet another bid to bragging rights for ex-pat Ontarians and Albertans. I’ve also lived in San Francisco, Oakland, Berkeley, Montreal, Toronto, London England and Glasgow and can decidedly attest that Vancouver is not the best place on earth. It may not even be the Best Place in Canada. In fact, Vancouver just gets uglier and more soul-less with every passing year, given the relentless tear-down culture here.”

Spot The Speculators #22 – “The realtor himself owns four, rented out, and plans to sell and retire with the equity a few years from now.”

anonymous at VREAA 22 Dec 2010 at 9.35pm – “I was told by a realtor dealing primarily with the Chinese segment [of the market] that many of the purchases are investment properties bought by people already here, using their first home’s equity as leverage to get a downpayment AND mortgage. As for overseas purchasers, they put down 40% cash and the rest is a mortgage from a Canadian bank. In fact, he told me many take out mortgages here with the favourable rates, and invest them in China and pocket the difference in interest!
The realtor himself owns four, rented out, and plans to sell and retire with the equity a few years from now.”

[Cavalier speculation by locals is rife and has been the major engine for this bubble. A large number of owners have “plans to sell and retire with the equity a few years from now”. Only a very small percentage will realize their dreams. -vreaa]

“I don’t see a price bubble”

“I don’t see a price bubble and I don’t see that we need the mortgage criteria tightened as is suggested in some quarters” – Helmut Pastrick, chief economist of Central 1 Credit Union, Financial Post, 19 Dec 2010

[Quote also archived in the ‘What Bubble?’ side-bar]

Central 1 Credit Union is the umbrella organization for credit unions in British Columbia and Ontario. Member financial institutions have nearly three million customers and hold about $70-billion in assets, the lion’s share of which are in British Columbia, home to some of Canada’s most expensive housing markets.

“In Vancouver there is no economic engine driving the local economy other than Real Estate. An economist at one of the local business schools said it’s like watching a game of Kerplunk.”

‘Fool me once…’ at greaterfool.ca 20 Dec 2010 1:10am – “I have spent all of my 50 years here in Vancouver. … This was a beautiful spot to grow up and raise a family. Was being the operative word. There is no economic engine driving the local economy other than anything related to Real Estate. This includes construction as well. Most of the local activity is supported by this sector. An economist at one of the local business schools said it’s like watching a game of Kerplunk, all the balls are still in play, but there’s only one stick left to hold them up. The stick is going to come out at some point of the game.”

Stealth Speculators & Shadow Inventory – “I am an owner who is again thinking of selling. A 10-30% hit I could handle. Any greater than that and I will regret not cashing out.”

There has been much discussion this week about debt, and about the likely effects of probable upcoming stricter mortgage criteria and rising interest rates on the Canadian housing market. Those are obviously important factors, and a tightening of finance may well be the precipitant that finally breaks this hardy camel’s back.

But, when it comes to the main engine that will accelerate a crash; the factor that will turn a shallow pullback into a dizzying plunge; we have long been most impressed by the effect of ‘shadow’ inventory. We believe that there are many Vancouver owners who are ‘stealth’ speculators, meaning that they have bought or are holding properties purely because prices have been rising. We suspect that a very large number of these properties, including personal residences, will come into the market in attempts at locking in profits or minimizing losses. With dropping prices, the reason for holding will disappear. Waves of inventory will cause prices to drop well beyond that which the consensus deems possible. There is the very real possibility that the selling will reach panic intensity.

Bulls who currently point to apparent unlimited demand and limited supply are not taking into account the dynamic nature of both supply and demand. When prices start their decline in earnest, both will change profoundly. This can happen very quickly.
Speculative demand (largely local) will disappear. Why buy a cash flow negative property in a price dropping environment? Why overextend to pay 10 times your annual income for a home that is dropping in price?
Supply will become plentiful. It will only take a small percentage of owners, perhaps just 4-6%, to decide to try and cash in at the same time for the market to crash.
Only a very small percentage of bubble participants get out with profits.

‘vancouverowner’ [RE Talks 14 Dec 2010 10:21pm] writes –

“As an owner sitting on a significant cushion (greater than 50%), I am again thinking of selling. I’m comfortable and my payments are virtually nil (tenants in the basement) but a capital gains hit will annoy me (at the least!) if we get hit as hard as the States has (and they look like they are in for another leg down). 10-30% I can handle. Any greater than that and I will regret not cashing out.”

This anecdote is extremely valuable as, we believe, it reflects the kind of thinking that is going on in the minds of many Vancouver owners. Some are getting wind of the possibility of price pullbacks, they are considering the possible effects of such pullbacks, and they are weighing their strategies. Do I wait or sell? If I don’t sell, at what point would I sell? How much of my paper profit could I stand to watch disappear? If we get to 30% off, how do I know it won’t hit 50%, 60% off? Shall I stay or shall I go?
Note that this owner is not somebody who is distressed. They are comfortable from the financing perspective. But they have a speculative component to their reason for holding their property, and that makes them a potential seller in the face of a downturn.
There are no karma points for riding markets up and down.
-vreaa