Category Archives: 13. 2010 Olympics Related

The direct and indirect effects of the 2010 Olympics on Vancouver RE.

‘Vancouver City Hall: Housing Report Card 2012’; Plus Revised Version

The following ‘Vancouver City Hall: Housing Report Card 2012’ appears at VanCityBuzz 8 April 2013.
The cheekily truthpacked revised version below that is from a source that is as yet unknown to us (but was passed on via e-mail by ‘B’, 9 Apr 2013).



Olympics, Redux – “Part of the reason that people get grumpy about the games is inflated expectations: the Olympics are always mis-sold.”

“Part of the reason that people get grumpy about the games is inflated expectations: the Olympics are always mis-sold. First, host governments say that the economic benefits of the games will greatly outweigh their costs. Second, they claim that the games will inspire people to exercise more. Third, they predict intangible benefits from being in the global spotlight for a couple of weeks. The first two claims are rubbish; the third does not apply to London.” [Nor did it to Vancouver. -ed.]
– from ‘Rewards of the rings’, The Economist, 21 Jul 2012

Bob Rennie – ‘Real Estate is a Sport’; ‘No Parking’; ‘I Love My Prius’; ‘Buy-Downs’; ‘Emerging Communities’; ‘Ghost-Town’; ‘Front-Row-Seats’; ‘Condo-Watchers’; ‘69% Of Buyers Own Homes’; ‘Repatriating Money’; ‘Passive Investment?’; ‘Like Trading Baseball Cards’

Bob Rennie, Vancouver condo marketer, on the ‘Bill Good Show’, CKNW 980AM, Vancouver Radio, 9am Friday 16 Mar 2012 [hat-tip Keith] –

Bill Good:  ‘Marine Gateway’ is the first major development along the Vancouver portion of the Canada line. And 11,000 people have registered to buy one of the 414 condos that will be up for sale this weekend. It hasn’t been since ‘Woodwards’ in 2006 that a condo project has created this level of early interest. Bob Rennie, of Rennie Marketing Systems is with me in the studio. This seems.. hard to believe..

Bob Rennie:  Yeah, it’s hard to believe what we go through in Vancouver, compared to almost any other jurisdiction in North America, other than Toronto.

Good:  So, 11,000 people?

Rennie:  11,000.. but you have to look, at a certain level, that in Vancouver, real estate is a sport, everybody wants to know what’s new, so half those people are interested in what’s the latest and greatest steel refrigerator, and going to see new lay-outs, and then you’ve got a core group of real buyers that are lined up there right now,

Good:  And there’s a line-up as we speak?

Rennie:  There’s a line-up, of 60 to 100 people.. you know… everybody wants the best and the cheapest on any project, so that’s just sort of an expectation in today’s market… everybody wants the top with the views, and everybody wants the cheapest for their daughter.

Good: (laughs)

Rennie: … and that’s where you get that initial interest from.. We’ve been open now for a couple of months, and everybody has been coming down and previewing, and they understand what floor plan they want, they understand what view they want, they understand they’ll live with or without parking, because .. the whole thing that…

Good:  Where exactly is this?

Rennie: Right at the SE corner of Marine and Cambie, and it’s right on the Canada-Line… so you’re not going across the street, you’re just coming down and walking out… but it’s retail, and it’s office, and it’s residential, so it’s a new emerging community..

Good:  What’s the price range?

Rennie:  There’s two hundred homes under three ninety-nine… so, that’s the attraction, is that affordability

Good:  So, under 400 thousand, and you can get on a sky-train and be downtown in 15 to 20 minutes.

Rennie:  Yes, downtown.. and.. what is your producers name?, I’m sorry, I forget…

Good:  Jessica…

Rennie:  I was just telling Jessica, that if you look at the difference between Jessica, and Bob, 55, that at 55 we’re looking at do we let go of one car in the household… we understand the cost of insurance, and running a car, and depreciation, and payments… Whereas Jessica, and Jessica doesn’t have a car…

Good: No, she’s ahead of you… she gave up her car and walks to work..

Rennie: Jessica, and Jessica doesn’t need to drive to the local drive-in to find out what’s happening tonight, she has an iPhone, and that difference in communication, that difference in that generation, that they’re not addicted to the car the way the baby-boomer generation is.. So, as I’m telling developers, we can build without parking,.. they’re going ‘No, nobody’s going to buy without parking’.. but we’re here, so, juts over 100 units there without parking. We did the ‘Capital Residences’, downtown, the old ‘Capital Theatre’ site, with 102 units without parking… Peter Wall did the ‘Scotia Bank Centre’.. we did about 115 units there without parking. Jessica and her younger friends have no desire to own a car… not just because of the overhead but they don’t need it for lifestyle.

Good: They also know that they can get a car share program, or can rent a car for a weekend, and they seem to be satisfied with that..

Rennie: ..and the zipcars and the modo cars, they work in the city where there’s a concentration of cars to pick up… when you get into the suburbs and you say we’ll have one car for 300 condominiums, it doesn’t really work, because you don’t have a concentration… that’ll all change. But my thing is… the Mayor is looking at affordability.. you know, Telus has announced it’s building an office building… I think it’s phenomenal for the city.. but that’s going to be filled with employees that don’t want to drive an hour and a half home… so we start really having to look at these emerging neighbourhoods…

Good: So, you’re seeing a real transformation..

Rennie: Absolutely.. I think this year we’ll bring out 1800 to 2000 homes transportation oriented.. so Marine Gateway, and then we’re doing at Boundary we’re doing 3 towers later in the Fall, and then we’re just going to start previewing in Richmond, ‘The Mandarin’, which is the very first Canada-Line station. Not only that, you’ve got a million square feet of shopping and restaurants. Somebody told me, if you’re going to buy in New York, find an area that’s the least inconvenient to your lifestyle, not the most convenient, but the least inconvenient… so the fact that you’ve got restaurant shopping, dry-cleaners, not just a telephone store, but real usage downstairs.. and the transportation is the big win.

Good: Well, you talked about the cost of the car, the cost of insurance, the cost of gasoline,.. but another huge factor, downtown, is the cost of parking…

Rennie: The cost of parking but the inconvenience now of being in a car driving down Hornby, or driving down Granville, where do I turn right or where do I turn left?.. and if you hit the wrong time, you’re in your car for 20 minutes, as opposed to being on the Canada line, on your laptop, on your iPhone, and just walking 5 minutes. So, this under 35 and over 45, there’s sort of purgatory inbetween there… the different ways that we look at the vehicle..
… [commercial break] …

Good: You think you’ll come close to selling out the 400+ condos, in a weekend?

Rennie: I would think, with the level of activity, and people lining up, that we will sell 90% of it on Saturday…

Good: You just told me you gave up your big fancy car, for a Prius… Are you trying to move into a generation below you?

Rennie: I’m trying to understand.. when I turned 50, I wanted a fancy car, I’ve always promised myself I would, I still get up 4:30 and work seven days a week.. but, after 2008, I was self-conscious of a fancy car, and was only driving it once a month, I thought, let’s let it go… and, my son didn’t think I’d last with it, but they got me a Prius, and I love it

Good: And you actually drive yourself?..

Rennie: I drive myself, yes (laughs)

Good: Because the last time I saw you you were getting into a great big black Mercedes, with a driver…

Rennie: The company has a Mercedes hybrid, that my assistant, Sylvia, stays with me 7 to 7, ‘cos all my business is running from boardroom to boardroom, from developer to developer in the downtown, and, when you look at driving and you look at parking, it’s just.. I like my assistant with me… so she stays until 7 o’clock and then, after that, I’ve got my Prius, I love it..

Good: But I thought it was interesting, you’re talking about a generation, and Jessica is among that generation, she gave up her car, a year ago, she walks to work… and you’re talking about people buying on the Canada line and using the transit system and being reliant on that.. and they don’t really need a car except on occassion…

Rennie: We’re building all our new developments on affordability – Jessica -, and then, the baby boomer – Bill and Bob – and, you know, this baby-boomer generation, which is 47 to 66 years old, they don’t have as much money to play with as they thought they had, they’re not taking the risks that they used to take..

Good: Interesting..

Rennie: And, for Jessica, they have this 500sqft 1 BR with no parking on transportation, 3/4 of the building still has parking, because we can’t shift culture that fast…

Good: The baby-boomer, I suspect, is thinking of driving less.. perhaps having one car instead of two..

Rennie: They’re driving the Prius; they’re driving a hybrid, because it’s socially acceptable… you don’t have to say “I don’t want to spend $150,000 on a car, I only want to spend $32,000 on a car”, and it’s socially acceptable to be green.. and if you look at the shift with the baby-boomer, they’re protecting the money that’s left.. you know I can throw the Olympic Village into here, we’re just launching Canada House, the Arthur Erickson inspired.. on the water.. it’s 40 homes, they’re a million dollars plus, but, the homes that are selling for one point five to three point four million are ‘buy-downs’… it’s people who are selling their West-side home that foreign money happens to be buying, it’s not for the local market anymore, and then that money is being repatriated to a ‘buy-down’ in a place like the Olympic Village. Ten years ago, the West-side buyer thought “it goes Granville to Province of Alberta”, there was nothing in-between.. and now, that baby-boomer, everybody’s thought pattern has shifted.. the Olympic Village is an emerging neighbourhood, Canada Line is an emerging neighbourhood, Woodwards is an emerging very conscious mixed-use diversified community, but it’s emerging…

Good: Now, the whole Olympic Village, that was such a controversy a couple of years ago.. it has really emerged, I saw the story the other night… 65% sold now…

Rennie: We relaunched it with the receiver, February 17th of eleven, and we invented this name ‘ghost-town’.. we went out to the media and we said “it’s a ghost-town, let’s be really transparent”.. there was a perception about the Village that it was failing.. and so we thought that if we put the ‘ghost-town’ on it.. Now, I’ve always though that, that community being on the sea-wall would stabilize and it’d be okay.. and there was 472 of the 737 condominiums sold.. you go down there it’s hustling-bustling.. Terra Breads has opened, you can’t get a seat in it.. Urban Fare we expect to open before the summer.. London Drugs is coming… the community is being built out.. so now that the asset is stabilized we recommended to the receiver that we can now bring on the front building, which is two small buildings, one with 40 units, one with 20…

Good: This is the high end.

Rennie: This is the high end… front-row seats right on the sea-wall.. starting tomorrow, Saturday, for two weeks it’s open to the public, after that it’s by appointment… You know, this one million to seven million dollar inventory really isn’t an open-house inventory.. but there’s a lot of real estate sport condo watchers and Olympic Village condo watchers, and where did Sidney Crosby speak condo watchers.. sleep.. condo watchers that’s where our Olympic team stayed was in Canada (House)..

Good: So where is the market for that.. is that a local market.. off-shore market, or both..

Rennie: it… we can tongue-in-cheek say it’s not.. it’s not off-shore… it is a local market..

Good: People downsizing?

Rennie: People downsizing.. they’re selling their West-side homes and they’re repatriating that money.. which is breathtaking (laughs).. to other jurisdictions, such as the Olympic Village. And, the Olympic Village, I needed 2.5 to 3 years to sell it, stabilize it, and earn the brand back.. when we bring on a Marine gateway, you go down, you put 10% down, and within a year you’ll have a 25% deposit and 33 months from now you’ll pay for it. So Bill and Georgie can figure out do we need it to live in?, do we put the kids in it?, are we going to spend more and more time on the coast?, do we just keep it as a passive investment?

Good: He’s trying to sell me!

Rennie: ..but I can’t get you ahead of the line!.. But you’ve got that 33 months to figure it out… But if you buy at the Olympic Village, within 60 days I want all your money. So you have to have been selling your home or selling your home (sic). Stats, if you’d like them, Bill, is that 69% of all homes sold in Greater Vancouver, are to people that already own a home. The other 31% are to first time buyers.

Good: So there’s still a first time buyer market?

Rennie: There’s still a..

Good: There has to be.. doesn’t there?

Rennie: But I think the deception, after my recent address, putting the numbers together.. I think the part we have to understand, is that this first time buyer, when we say we’re the most expensive place to live, is based on incomes, but the 69% of buyers already own a home, it’s an equity play, they’re just trading baseball cards.. But the 31%, I’m trying to understand.. so, I’m putting the figures together.. of the over 55 year population that owns their homes clear title, and that 55 to 74 year old, when they’re selling their home, they’re helping the kids and the grand-children… they’ve… (my stats guys) and I were joking the other day that we’re gonna make t-shirts that say “My grandparents bought a home in 1978, and alls I got was a lousy one bedroom condominium”… because that money is being repatriated down to help the kids..

Good: OK, we’re almost out of time..

Transcribed here, for the record. -ed.


It’s Official: No Longer “Best Place On Earth” – “Best Place on Earth” was a “broader brand” used only in B.C. “to help motivate British Columbians.”

In April 2007, VANOC CEO John Furlong (left) and then Premier Gordon Campbell unveiled licence plate naming B.C. ‘The Best Place on Earth.’

“BC No Longer Calls Self ‘Best Place on Earth’.
The boast is vanishing from official branding. Where did it go, and why?

The “Best Place on Earth” and the sunshine-and-mountains logo (is it setting or rising?), was launched in 2005 and registered with Industry Canada’s Canadian Intellectual Property Office the following year. It appeared on ICBC’s Vancouver 2010 Winter Olympics licence plates in 2007, replacing the traditional “Beautiful” above a photograph of Mount Garibaldi and the VANOC inukshuk logo.
But something funny happened on the way to the biggest show on Earth. When Campbell put on his salesman-in-chief hat and attended the Beijing Olympics in 2008, he called British Columbia “Canada’s Pacific Gateway” instead of the “Best Place on Earth.” With a pinch of sarcasm, I asked him, why? If B.C. is really the best place anywhere, why not tell the world?
First the world has to find B.C. on the map, he said.
Jobs, Tourism and Innovation minister Pat Bell offered few hints about the slogan’s fate when he was grilled by NDP critic Spencer Chandra Herbert in a May 5 budget estimates debate.
“Yes, I am proud of the province and I think it’s the best place on earth, but it was probably not the best way to attract people from other parts of the world who think their little section of the world was the best place on earth,” Chandra Herbert said to Bell. “I’m just wondering: is ‘best place on earth’ shelved for now, and we’re now not going to see that anymore, and we’ll see ‘Super, natural B.C.’ in its place?
Bell answered that “Best Place on Earth” was a “broader brand” used only in B.C. “to help motivate British Columbians.”

Since Premier Christy Clark’s March swearing-in, the bold advertising slogan of the Gordon Campbell era has slowly and quietly disappeared from government websites and letterhead. You can still find it if you look, but blink and it could be gone.
How could a province with a misery-filled neighbourhood like the Downtown Eastside and a nation-leading child poverty rate ever call itself best-on-Earth in the first place? How did the politicians and bureaucrats decide to deep-six the slogan?
The decision, I am told, was not even of the “back-of-the-napkin” variety, because no scrap of paper was used to record it.

– Bob Mackin,, 4 Oct 2011
[hat-tip Nemesis]

So, now we understand. We have always been puzzled by the claim, this explains all.
The slogan was not an actual claim that BC was the “Best Place on Earth”, it was used “only in B.C., to help motivate British Columbians.”
So, citizens of BC, how does it feel to have been treated all these years like children; like the second to last team in the local Under-7 hockey league?
The real problem is that many folks lapped it up. And, relevant to us here, it helped push them to reach for that much more debt, so they could overextend even further to buy that much more unaffordable ‘BPOE’ real estate.
“C’mon, you can do it, you can do it… Bid another $75K beyond your means! You can do it! Stretch, stretch…!”
– vreaa

UPDATE: More on this story from Doug Ward, Vanc Sun, 7 Oct 2011
“My initial reaction is ‘hurray,'” said Peter Williams, director of Simon Fraser University’s Centre for Tourism Policy and Research, about the slogan’s demise.
“It was presumptuous. If it was meant to endear people to us, it probably wasn’t going to do that given that a lot of other people live in other parts of the world that are pretty nice. And probably quite competitive to B.C. in many senses.”

[Off with his head! -ed.]
Government communications director Greer said the slogan was aimed at British Columbians and not for a global market. “It was more of in-province pride thing.”
[See: appropriate for 6 year olds, above. -ed.]
“Canada Starts Here” is also the brand used in the marketing of Clark’s new jobs strategy.
[Actually, wouldn’t it be just as accurate to say “Canada Ends Here” ? -ed.]
B.C.’s tourism brand continues to be the venerable “Super Natural British Columbia.”
SFU’s Williams said the “Super Natural British Columbia” brand has gone through “many reincarnations but it’s held up pretty well and I thought this ‘Best Place On Earth’ was creating some confusion in the marketplace that we didn’t really need.”

[Whereas “Super Natural British Columbia” was a big hit with visiting goblins, gremlins, elves and apparitions. -ed.]

Steak = Overpriced Condo; Sizzle = Vancouver ‘Safety’ : “The broader asset is Vancouver.”

Voice over: Tuesday Bob Rennie launches the sale of the section called ‘Sails’… Bigger units, bigger views, bigger prices… from half a million up to two million dollars.
Reporter: How do you go about doing something like this when there is such financial turmoil?
Rennie: You know… we can start… we’re talking about the asset called ‘The Village’, but the broader asset is Vancouver… If you want to take money out of volatile markets, Vancouver is looked at as a very safe place to put money.
– excerpted from Global TV ‘News’ piece on RE selling in Surrey and the Olympic Village, 24 Sep 2011 [hat-tip Greenhorn]

“The broader asset is Vancouver” – Bob Rennie, Rennie Marketing Systems, Global TV ‘News’ (2011)
“Don’t Sell the Steak — Sell the Sizzle!” – Elmer Wheeler, Marketing Expert, ‘Tested Sentences That Sell’ (1937)

People are poor at assessing ‘safety’ when it comes to investments.
Assets that have shown apparent strength because of massive speculative momentum, are actually the least-safe place to attempt to invest.
Vancouver RE will look safe until it doesn’t, and demand will then quickly disappear.
We’ll find out what it’s like to participate in the downside of volatility.
Steaks will once again become steaks.
– vreaa

Olympic Village Update – A Waggish Resident Expresses Their Frustration

– Seen posted in one of the Olympic Village buildings. Photo from ‘zerodown’, via e-mail to VREAA, 6 Sep 2011.

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

Another Article On Olympic Village Owner Litigation

From ‘A $1.8-million Olympic Village dream turns sour’, by Gary Mason, G&M, 25 Mar 2011
“Helen Lee and her husband bought a place in Vancouver’s Olympic Village back in 2007, when it was still being built.
A gold-medal sales pitch compelled the couple to fork out $1.8-million for an 11th-floor, 1,475-square-foot condo with expansive mountain and water views.
“It was going to be our dream home,” Ms. Lee remembers.
Four years later, the couple’s dream has officially turned into a nightmare.
The Lees are among more than 60 condo owners at the Village who have filed a class-action lawsuit demanding their money back.
“One of our bathroom doors opens out into the hallway,” Ms. Lee told me. “I have two children who run back and forth in front of it and they have been hit by the door. Our floors are wrecked. We’ve had no heat for two months. The flex space we were promised is half the size.”
The Lees would love to find a way to get their money back. They, like most of the others involved in the lawsuit, bought at the top of the market.
Personally, I [Gary Mason] can muster some sympathy for the owners. When you fork out $1.8-million for a condo you expect it to be built to the highest standards.”

The buyer deserves to get a condo at the specifications promised in the original deal.
If they are compensated, they should be compensated for an amount that reflects the physical deficiencies NOT an amount that reflects the plunge in market price.
If the market price of these condos had gone UP by 30% since their purchase, the only thing we’d be hearing from them is cooing about what bright investors they are. The buyers should bear the full brunt of the price change risk.
The OV examples are just a small taste of the kind of bickering we’ll hear for years after the broad market plunges. -vreaa

Michael Geller, Opinion – “While Vancouver prices are high by Canadian and North American standards, as evidenced by a recent photo essay on the most expensive streets in the world, they are still less than some European and Asian cities.”

Very occasionally we will headline the opinion of a local commentator, for the record. Hat-tip to jesse for alerting us to this recent comment on the Olympic Village and the Vancouver market by Michael Geller at 21 March 2011 3:39pm. Geller describes himself as “a Vancouver based architect, planner, real estate consultant and property developer with four decades’ experience in the public, private and institutional sectors.”

We’d characterize Geller’s outlook as “sunny and clear, with unexplained brief patches of drizzle”. He’s a complacent bull, he is not warning of an overheated market. He sees $700/sqft as a fair price for a condo in Vancouver. Comparisons of local pricing with “the most expensive streets in the world”, and the presence of mainland Chinese buyers, have soothed his concerns that prices may have gotten too high. At the same time he sees some westside/Richmond SFH lot prices as “outrageous”, and he notes the poor quality of construction (“the construction quality is not any worse than what one has come to expect in the Vancouver market”).
He plays the very tired and very wrong “stopped clock” card (roulette-betting version) and, in a rearview fashion, points to past price appreciation as a reason to not be bearish (“anyone who followed [Garth Turner’s] advice in the past has probably missed out on some significant property appreciation”). Both of those arguments are classic bull-blinkers during bubbles. Michael Geller is not warning of a bubble; in fact, the headlined quote classifies him as a bubble-denier. -vreaa

Here’s the recent comment from Michael Geller, in full, for the record:
I will offer a few thoughts on OV and the housing market as a whole.
I do not think anyone should attempt to generalize about the Vcr real estate market based on what happened at OV. The fact that prices were reduced by 30%in this project is not a reflection of a drop in the market. It is a reflection of the overly aggressive pricing for this development when it first went on sale, and in May 2010 when it was re-launched.
I think it is fair to say that most developers and real estate analysts in Vancouver always considered this project to be over-priced, given the location (it’s not yet Coal Harbour, or even the North Shore of False Creek); the general site and building designs which reduce the number of units with views and result in many contorted layouts, and the overall standard of finishes. I would also add that given the extent of exterior walls, which are included in the floor space calcualations, the effective interior area is often less than for a comparable unit in a more conventional building form.
That being said, I do believe that many of the units are now much more fairly priced. Indeed, I did encourage a friend of mine to purchase a penthouse unit at what I thought was a very attractive price.
As for concerns about construction quality, while there have been problems, including water pouring out of at least one light fixture, and problems with the heating system, I am told by people in the industry that the construction quality is not any worse than what one has come to expect in the Vancouver market. I understand that some of the green features have ‘bugs’ that need to be worked out, but this happens with many innovations. One day, they should offer increased livability and other benefits.
There is no doubt that some of the finishes are below the standard one might expect for a $1000 a sq.ft. plus product, but they are in line with $700 a sq.ft. product.
As for the unit layouts, there is no doubt that many of the plans are quite odd, and not always as furnishable as they should be. As to why this is, I too would like to hear from the marketing team, since this is something they usually go over with the developer and architects. (Sadly, too many architects are more concerned with the overall look and appearance of a building, than whether a bedroom is properly dimensioned to accommodate the required furniture.)
It is my view that the plans were not as good as they should have been because of the very large number of units being built at once; the many different unit types resulting from the many, non-standardized building forms; and the shortage of time due to the rush to get permits issued and construction underway.
(As an aside, I have spent weeks trying to perfect 3 unit types for a small project I am doing in W.Van, and am still fretting about certain details!)
But is the OV signaling a potential drop in the Vancouver market? No. Is the Vancouver market going to drop? Well, some of us have thought prices were too high for quite a long time. But now that many buyers are coming here from Mainland China, prices have remained high, especially in certain areas. (Personally, I find the prices being paid for West Side Vancouver and Richmond single family lots outrageous.) And to some degree, this indirectly influences the prices being asked for other properties.
While Vancouver prices are high by Canadian and North American standards, as evidenced by a recent photo essay on the most expensive streets in the world, they are still less than some European and Asian cities.
Two final thoughts. In my opinion, the adverse publicity resulting from the lawsuits from disatisfied purchasers has to be having some effect on the current sales program. How can it not? At the same time, I too find it hard to be too sympathetic towards someone who probably devoted less time purchasing a very expensive apartment than they would devote towards the purchase of a new car.
In this regard, I would urge future purchasers to review the floor layouts and unit outlooks carefully, both in the daytime, and at night.
Finally, as for Garth Turner….well, he has been predicting significant corrections in the market for a long, long, time. One day, he’ll be right, of course, just like the person who keeps betting on the same number on a roulette table. But in the meanwhile, anyone who followed his advice in the past has probably missed out on some significant property appreciation, especially in Vancouver.”

‘Nobody Loves You When You’re Down 30% And Out’ – “This is not my fault. All I did is I just paid one point three million for this unit”

From Olympic Village Lawsuit‘, 16 Mar 2011,
“A lawsuit by a group of very unhappy condo owners.”

“Water dripping from the ceiling into toilets, or through light fixtures…”

“This owner’s apartment was without heat for 4 months after the heat and cooling system in the ceiling ruptured.”

Owner One voice over: “This is not my fault. All I did is… I just paid one point three million for this unit.”
Announcer: “That’s right, one point three million. He and owners have had enough.”

Owner Two (Mary Fines) “It’s not what we bought. [No, you bought something selling for about 50% more than it’s selling for now. -ed.] We’ve been lied to.”

“Lawyers say that it’s a first for Vancouver real estate, so many people, 62, wanting out of so many buildings, 5 in total.”
“It’s not just shoddy construction, like windows leaking when it rains…”

“…it’s about master bedrooms with no room for a queen-size bed…”

“The lawyers say, as owners of the land, and the lender, the City of Vancouver has an obligation to step in and fix these problems, or give the owners their money back.”
[Lawyer for Plaintiffs, Bryan Baynham]: “The product isn’t there. They were promised world class luxury and they got delivered something far far less.”

“The lawyer representing Marketer Bob Rennie suspects the recent price reductions of unsold condos may have something to do with this civil suit:
[Lawyer for Marketer, George Macintosh]“The arguments which are advanced officially… right?.. are.. are just attempts… right?… to get a complaint, when really what they’re upset about is the market price has changed.” [Agreed. -ed.]

“While the lawyers were talking today, Bob Rennie the marketer, mayor Gregor Robertson, and city staff, declined to comment or were unavailable to do so.” [Now that’s newsworthy… -ed.]

Owners love real estate when it goes up, but ruthlessly lose feeling for it when it becomes a leaking, cash-bleeding, price-dropping albatross. Expect more litigation in coming years. – vreaa

Spot The Speculators #28 – Olympic Village Speculations Gone Sour

Early buyers are being sued for trying to back out of their commitments to purchase at the Olympic Village [Globe and Mail, 20 Feb 2011].
Examples, from the article –

1. Port Coquitlam resident Cordelia Lins and her husband had put down $50,090 in May of 2008 for a unit they originally agreed to buy for $500,900. Problems with records make it difficult to determine the assessed value. Ms. Lin said she couldn’t say anything about the lawsuit because she was “in negotiations.”

2. Vancouver resident Gee Lim, who paid the largest deposit for a unit he originally agreed to buy for $1.4-million, did not answer his phone. He originally agreed to buy his unit in April 2008. Last July, the province’s land-assessment authority valued that unit at only $1.172-million.

3. Tian Qi, who has no phone listing at the Richmond address provided in the suit, had agreed to pay $516,000 for his unit in the Kayak building that is now being marketed. It was assessed at $504,000 by B.C. Assessment Authority last July. He put down his deposit in April 2008.

Frances Bula On CBC – “This is a city where we’ve built our economy, and many of us have built our personal lives, on speculating on real estate. Even our own houses, we pay crazy prices for them, in the expectation that prices are going to rise, not because our incomes can in any way cover them.”

When it comes to deducing what mainstream commentators really think about the Vancouver real estate market, television clips and radio interviews can be far more telling than newspaper articles. The carefully phrased, edited, and re-edited written word, doesn’t reveal as much as the verbal nuances, body-language, facial expression, and less censored content that often emerges in interview.  Frances Bula is a contributor to The Globe & Mail, a city columnist for Vancouver Magazine, and a blogger  with focus on city affairs (‘State of Vancouver’). We are unaware of her writing anything, anywhere, that explicitly identifies a RE speculation problem broadly amongst Vancouverites. Here, however, she identifies such a problem, in a radio interview:

Frances Bula: “Yeah, I mean, one of the things I’ve always found fascinating about this project is that in a way it’s symbolic of Vancouver and all of us… uhm, you know, this is a city that in a way we’ve built our economy and many of us have built our personal lives, in a way, on speculating on real estate… even our own houses, we pay crazy prices for them, in the expectation that prices are going to rise, not because our incomes can in any way cover them [laughing, and laughter from others] so we have a whole city that’s kinda gotten caught up in this because really what happened there [at the Olympic Village] is that everyone thought the real estate market would just keep going up and up, that the market could bear all the different things they were doing… making it green, building beautiful things around it, and so on, and, we were all caught out.” – CBC Radio, ‘The Early Edition’, 17 Feb 2011, interview with Kathryn Gretsinger, about the Olympic Village sales plan.

Almost every Vancouver RE purchase has a speculative component, even if it is most often coated in a veneer of wholesome innocence. The willingness of locals to borrow vast sums of money, and to use that money to bid up RE prices, has driven our bubble. As Bula implies (and as we have long argued) stratospheric prices would not have been paid by people who didn’t expect ongoing limitless price appreciation. This speculation, by all buyers, is a far, far more important engine to our bubble than other commonly touted phenomena, such as, for instance, foreign money.
See the ‘Spot The Speculator’ sidebar category for numerous relevant examples.
Q: What happens to speculative demand when prices start dropping?
A: It evaporates.
Q: What happens to speculative holdings when prices start dropping?
A: They become supply.

Thanks to Froogle Scott for alerting us to this clip. As Froogle writes, via e-mail: “Frances Bula sounds like she harbours quite a bit of bearish sentiment, and doesn’t exclude herself from what has gone on with Van RE. And given her professional background, she’s obviously someone who’s very knowledgeable about Vancouver, past and present. A member of the MSM who isn’t willing to be a purveyor of the Kool-Aid?”
Those of you who don’t yet know Froogle’s own story, take a look here.

Post-Olympic Sentiment Low-Point – “Canada investigates mass sled dog slaughter”

Covered all over the local press, but internationally, too. Here it is from 31 Jan 2011
Excerpt: “Police are investigating the slaughter of 100 husky dogs used during the 2010 Winter Olympics to pull tourist sleds in the Canadian ski resort of Whistler, authorities said Monday. The grisly killings were reportedly carried out by one worker over two days in April 2010 with a shotgun and a knife, with reports of injured dogs crawling out of a mass grave. Local media said the dogs were killed because business slumped in the two months following the Games and they were no longer needed by tourism companies Outdoor Adventures and Howling Dogs, which sell dog-sled rides to tourists.”

Olympian Marketing Task – “I’ve set a target of selling 100 units by June. Everything is now on the table. It has become a do-right or die effort.”

‘Marketing specialist’ Bob Rennie’s quotes extracted from the Vancouver Sun 29 Nov 2010
“It has become a do-right or die effort. The village has only one last opportunity to be successfully marketed if it is to escape its vexing image as a troubled neighbourhood.”
“The word ‘Olympic’ is a really, really expensive word. It is wrought with controversy. It can be seen as a weakness. But it can also be seen as a strength.”
“When someone gets into a taxi at the airport and says “take me to the Olympic village” everyone knows where that is. It’s not the same when someone says the name of a residential building downtown.”
“That’s the strength in this project. It is the only Olympic village. But we have to get this one right.”
“We will begin to market about 150 units in two to three waterfront buildings. Half of the condos, which average 1,000 square feet, will be under$1 million, and the other 50 per cent will be over $1 million. I’ve set a target of selling 100 units by June. It will take upwards of three years to sell all of the 473 remaining units in the village.”
“Everything is now on the table. These will be price-competitive to what is out on the market.”

Regarding the structure in the image above, from Wikipedia:
“The Temple of Olympian Zeus (Greek: Ναὸς τοῦ Ὀλυμπίου Διός, Naos tou Olympiou Dios), also known as the Olympieion, is a colossal ruined temple in the centre of the Greek capital Athens that was dedicated to Zeus, king of the Olympian gods. Construction began in the 6th century BC during the rule of the Athenian tyrants, who envisaged building the greatest temple in the ancient world, but it was not completed until the reign of the Roman Emperor Hadrian in the 2nd century AD some 638 years after the project had begun. During the Roman periods it was renowned as the largest temple in Greece and housed one of the largest cult statues in the ancient world.
The temple’s glory was short-lived, as it fell into disuse after being pillaged in a barbarian invasion in the 3rd century AD. It was probably never repaired and was reduced to ruins thereafter. In the centuries after the fall of the Roman Empire, the temple was extensively quarried for building materials to supply building projects elsewhere in the city. Despite this, substantial remains remain visible today and it continues to be a major tourist attraction.”

“Short of real estate prices rising substantially, it’s probably going to be a tough road ahead.”

GlobalBC TV clip [19 Nov 2010] on prospective taxpayer losses from the Olympic Village [archived at youtube by GreenhornRET]. Final statement –
“Short of real estate prices rising substantially, it’s probably going to be a tough road ahead.. for the City, and for taxpayers.”

This doesn’t just apply to the Olympic Village, but to our entire RE market, and to our economy. We’ve become completely dependent on an ongoing RE boom. -vreaa

The End Of The Implausible Happy-Ending Scenario – “Real estate prices would rise 40 per cent quickly, condo prices would increase, and cost overruns would be covered.”

From an article in The Province [19 Nov 2010] on the implications of the developer for the Olympic Village going into receivership.
After laying out the likely money losing outcomes, the article ends with these flippant statements:
“There is a fourth scenario, however implausible, with a happy ending.
Real estate prices would rise 40 per cent quickly, condo prices would increase and cost overruns would be covered.
“Everyone would go away happy,” said [UBC real estate professor] Tsur Somerville.

(sarcasm/) Why is this so implausible? (/sarcasm)
Hasn’t our entire economy, for the last 10 years, been completely dependent on just such an implausible ongoing RE-price-rise bailout?
Where would we be without the 100%, 200%, 200+% RE price rises?
What will happen to Vancouver if/when RE prices don’t “rise x% quickly”.
We guess we’ll find out.
– vreaa

“These were supposed to be the ‘greenest Games ever’. What a joke.”

We seem to be world leaders in the area of self deception. -vreaa

Buses For Games Not Green, by Bob Mackin, 24h News Vancouver, 10 Nov 2010 [excerpts] – “More than 1,000 buses from around North America used at the 2010 Winter Olympics and Paralympics were driven a combined 5.1 million kilometres to and from Vancouver. British Columbia Passenger Transportation Branch temporary licence records obtained by 24 hours via Freedom of Information show that VANOC charter bus contractor Gameday Management Group of Orlando, Fla., formed a mostly diesel, mostly American fleet to shuttle athletes, sponsors, dignitaries, media, workers and spectators in February and March.
Numerous companies still owed their final payments await the results of this week’s mediation between VANOC and Gameday, which claims it’s owed $10 million. Taxpayers bailed out VANOC for at least $80 million and could be on the hook for more.
Using the list of companies and their addresses, 24 hours measured the round-trip distances using Google Maps and found the 1,112 buses went 5,106,618.2 km, or a total of 127 trips around the equator.
The documents do not show how far the buses went while in the city during the Games.
“These were supposed to be the ‘greenest Games ever’,” said Olympic critic and Five Ring Circus author Chris Shaw. “What a joke.”

“Update on an Olympic Village rental condo, where the asking rent is decreasing.”

El Magnifico at VREAA 31 Oct 2010 1.12pm“Update on a rental property I posted some time ago. Rents are decreasing as well…
I have been following this 1BR 630 sq.ft. condo in the Olympic village. It has been for rent since at least early August 2 for $1750! (I even sent them an email early September to tell them that there was no way they were going to find a fool that would pay $1750 per month for that). After sitting empty for 3 months, they finally followed my advice and decreased their price to $1,650 which is still very expensive considering the size, location and bad publicity around the OV…
I’m wondering how long it will take them to find a tenant and how much it will have cost them to wait with their overpriced condo sitting empty…
Here is the link:

OV Developers On Best Behaviour

“The tax payer has to be paid back fully before we make any profits or before we even get our money back…”
[Interviewer: Is that a guarantee?] “That is something that we are striving (cough) striving towards, and it’s something that doesn’t have to be done now, we have two and a half years to reach that goal.”Malek Brothers, Global TV, 7 Oct 2010
[These guys sure look like they’ve been pulled up in front of the school principal, don’t they?]

Spot The (Disappearing) Speculator #19 – Bob Rennie: “I’ve Lost The Speculative Buyer”

Local condo salesman Bob Rennie describes how speculators have deserted the market for the Olympic Village condos, The Province, 8 Oct 2010
“We have a huge problem with the Olympic Village that it’s not for speculators, it’s for a community of homeowners. I’ve lost that buyer who says, ‘I’ll buy it today and over the next two or three years I’ll figure out whether I’m a passive investor or whether mom lives in it or whether we live in it and sell our house.’ ”

What Mr Rennie is saying is that when people stop buying Vancouver RE simply for the reason that they believe that prices are going up indefinitely, he (and by inference the whole market) has a problem. An interesting observation. One that local RE bears have been singing from the roof-tops for years.

We’ve previously described how almost ALL Vancouver RE purchases over the last 5 years (or more) have had a speculative component woven into them. People have only paid higher and higher prices under the assumption that prices would continue on their upward trajectory, regardless of their value by any fundamental measure. That is the very essence of speculation.

Well, speculation in Vancouver RE is now over, for perhaps a decade or two. Volume is down and prices are going to drop from these giddy heights. When that starts happening, prices will drop further and further, possibly on increasing volume, as weak speculative hands exit the market. These players will rush for the exits as the only factor that kept them in the market, namely rising prices, disappears. Price drops will beget price drops. At 25% off, we may get a bounce, but when we eventually get below that level, the drop will be even more precipitous.

We’ve seen speculative evaporation in the periphery, and now in the ridiculously overpriced Olympic Village condos mentioned above. But speculation will soon leave ALL areas of the market. We think that the most devastating aspect of this process will be when COVERT speculation disappears, meaning that those innocent looking first-time-buyers and move-uppers, who in recent years were merrily signing their lives away with background expectations of price increases, will freeze their buying intentions when they realize that the market has reversed.

What will prices be when people are buying homes without the expectation of price gains?
What will prices be when people are buying homes as shelter (+ modest ownership premium) and not as ‘investment’ (read: speculative) vehicles?
Certainly far lower than they are today.

“I rent in a building that shares some of the LEED technology that the OV uses – ‘what a hunk a junk’ is all I can say.”

YLTNBoomerang at 4 Oct 2010 9.31 am“I rent in a building that was completed about two years ago and also shares some of the LEED technology that the OV uses – what a hunk a junk is all I can say. What is interesting is that it seems that the building is significantly occupied by renters and we all discuss how lousy the construction is and that we would never buy here. The lack of owner occupier’s has also led to poor upkeep where it seems that a lot of people who live here just don’t care about the strata rules or taking care of the common areas. I’m not saying renters are slobs or trash the place but the truth is that when you don’t own, you treat the place more like a hotel than a place that eats up 60% of your take-home (myself included). I pay a lot for rent, I’m not going to wear kid-gloves when I interface with the building, if something breaks from shoddy construction or maintenance I am going to complain to the landlord!”

Olympic Village Fiasco – News Video Archive

Greenhorn (aka SethM), a regular poster at RE Talks, has done a marvelous job of collecting an archive of video news clips regarding the Olympic Village, at youtube. As the story unfolds, we see it interpreted step-by-step by the local news channels. The village will quite likely prove to be representative of the entire Vancouver market. Common themes of arrogance and overconfidence running into the brick wall of reality. Some memorable moments:

“The athletes will move in; they’ll move out; and the consumer will move into their condos, so that there is no cost to the city or the province.”Bob Rennie, Marketer, September 2008

“There is more than sufficient security to back those loans up.”Shahram Malek, Millenium Properties, 7 Nov 2008

“I am confident that this is a very good deal for the taxpayers… there will be no risk to the taxpayers.”Peter Ladner, ex Mayoral Candidate for NPA, 10 Nov 2008

“Welcome to your new digs, John.”Gregor Robertson, Mayor, at key-to-the-village handover to John Furlong, VANOC, Nov 2009

“I feel good about it. I think that everybody will make money.”Bob Rennie, Marketer, 16 May 2010

“My clients thought they were buying a very high end unit and they don’t believe Millenium is delivering anything near what they promised. … Once a purchaser loses faith in a building, they just don’t want to be there.”Bryan Baynham, Lawyer, 26 Jun 2010

“It’s absolutely normal. We have no concerns.”Penny Ballem, Vancouver City Manager, 26 Jun 2010, regarding people trying to get out of presale contracts.

“A sterile environment, it feels like a science-fiction film.”Visitor, 2 Sep 2010

“Promises were made around having a social legacy to the Olympics… Now that the circus has left town, a different story is emerging.”Am Johal, Community Coalition, 2 Sep 2010

“If I have to include the HST portion that’s been added to.. on top of GST, or we’re looking at a couple of months, uh… we’re looking at a couple of years maintenance fees, we’re going to announce those incentives sort of mid-September that what will stimulate people to buy.”Bob Rennie, Marketer, 2 Sep 2010

“It’s like a ghost town. … They were telling me.. look at the benefit you’re going to get, you are going to make so much money.”Mario Loscerbo, Mario’s Gelati,  a nearby business that endured years of construction inconvenience, 30 Sep 2010

“It’s awfully quiet.”CTV News, 30 Sep 2010

Spot The Speculator #17 – “Inability to meet loan payment… The company owns almost 200 pieces of real estate. Many of the B.C. holdings are encumbered by large mortgages.”

From ‘City goes after assets of Games developer’, Globe and Mail, 30 Sep 2010“Councillor Geoff Meggs said the inability of developers Peter and Shahram Malek to use other assets they own to meet their loan payment was a “red flag” for the city. … Sources say it’s not clear the exact value is of Millennium’s holdings or of the Maleks personally. That means no one knows at this point whether there is enough security to cover any shortfalls at the village if sales of the residential units never generate enough money to cover the construction loan and the price of the city’s land. … Land records show that the company owns almost 200 pieces of real estate, while Shahram Malek has 15 different properties listed under his name. The Malek family, which ran a construction business in Iran before coming to Canada in the 1980s, also has holdings in Europe and the Middle East. However, many of its B.C. holdings are encumbered by large mortgages and, in some cases, more than one lender is involved.”

HST Fit – “I am so pissed, I cannot put my thoughts into words.”

“I am so pissed, I cannot put my thoughts into words.”Bob Rennie, Vancouver condo marketer, on the marketing uncertainty generated by Premier Gordon Campbell’s announcement this week that the HST would go to a referendum on Sept. 24, 2011 [Globe and Mail, 16 Sep 2010].

Remember when Bob Rennie was un-pissed enough to put his thoughts into these words: “EVERYTHING IS GOING TO BE ALRIGHT” ? That was back in Sept 2009 when markets were storming back and Vancouver RE looked bullet-proof:

Rennie is trying to sell lots of condos, including >400 in the Olympic Village, in the face of a stalling RE market.

When bubbles burst, people re-write history; they retrospectively come up with ’causes’ for an implosion. They do this because it’s far easier for them to tell themselves that something extraneous, something unpredictable, caused a crash, rather than to admit that they were foolish enough to not recognize a classic and irrational market bubble that had been staring them in the face for years. They’d rather see themselves as surprised than gullible. (And, even better, indignantly blame somebody else at the same time.) Witness locals who now preach that our housing price drop in 2008-2009 was caused by the Sept-Nov 2008 global economic meltdown. [It wasn’t – The Vancouver housing market topped in the summer of 2008, months BEFORE the financial meltdown. Perversely, the global free-money emergency financial bailout RESCUED our RE market… Temporarily, anyway.]

Bubbles don’t need ANYTHING to pop them, they eventually, always, inevitably, collapse under their own weight, as ours is now proceeding to do. Like forest fires, they roar deliriously, then run out of fuel.

The HST is serving as a very convenient scapegoat for current poor sales, and it’s a fair bet that it’ll be pointed to in future as something that brought down the market. But in the grand scheme of things it’s essentially irrelevant. The real problem for this debt-fueled speculative-bubble market is in its very fabric, and that flaw is way, way bigger than the HST.

Renting In The Olympic Village Ghost Town

Allen Roberts lives in a rented condo at the Olympic Village. Many units remain empty.

From The Province, 8 Sep 2010“It’s weird,” said Heather Eddy, who recently moved into a sixth-floor rental unit at West 1st and Columbia with her boyfriend, Allen Roberts, 30, an engineering student at Simon Fraser University. “It’s almost like living in a futuristic police state. All you see are police cars driving around and people on bicycles.” Eddy, a 24-year-old pastry chef, said she believes the village was opened too early. “It’s very much like a ghost town,” she added. “I’m scared to walk down the streets at night.” The couple, however, said they love their 850-square-foot apartment with its high windows and top-end appliances.

The realtor said “You can’t believe but there was not a single call for this house for 30 days”.

Patsan at 4 Jun 2010 11 p.m.

“My family are renting a house on the West Side and in January my amateur landlord put the house for sale as “financial conditions changed”. My family kindly agreed to show the house once a week to potential buyers. At the beginning showings were active and once we had seven parties to wander around. By the end of April there were one or two viewers per week. In May – zilch – nothing – no showings and no call from the realtor for four weeks. Yesterday I inadvertently bumped into the guy in downtown and asked him what’s going on. The realtor said “you can’t believe but there was not a single call for this house for 30 days”. I told him that there is no reason for dejection because it is different here and maybe all the potential buyers are flocking to Johannesburg to snap some properties during FIFA World Cup and then will be back home. To say that he was stunned is to say nothing.” [haha, cute joke -ed.]

A Realtor’s Review – “And there is the problem. This Olympic Village, Millennium Water, whatever you want to call it, is completely unaffordable.”

This excerpted from an article by local realtor Will Wertheim at 17 May 2010 2:51 pm

“Today I attended a Realtor review of the Millennium Water development.” … “Mr. Bob Rennie, the King of All Condos, spoke to the crowd. Those who expected a rousing and uplifting speech would be shocked by what he said. It was far more somber, realistic, and tempered with hope rather than wishes.” …  “After the speech we went in groups of twenty to visit the showhomes. … You have a group of realtors, people who sell for a living, people who know their product, and the reactions you get from them will pretty much determine the results. We started in the lowest priced home which was $595k for just about 600 square feet. No view. Reaction? Astonishment at the price. We moved on to another and another. Prices being bandied about were up to 1.X million. Reaction? Astonishment at the gall. We moved into a 2.1m unit and at over $1400/sq.ft. the reaction became muted. It was an impressive suite. We get into the Erickson designed buildings and the prices were $2.Xm and just under $4m, I think. The reaction was much more appreciative. The suites were large and well designed. The views were fantastic and the prices were reflective of the quality and the location. And there is the problem. This Olympic Village, Millennium Water, whatever you want to call it, is completely unaffordable.”

[Note that Will Wertheim finds this development overpriced in terms of the current market, which many of us believe is itself already very, very overpriced. -vreaa]

Field Report From ‘Millennium Water’ – “Vancouver’s Ground Zero For Irrational Exuberance” – “So why, in your opinion, does this place come at a $700,000 premium?”

crashcow at 15 May 2010 6:13 pm

“With the weather so nice today, I decided to checkout my first open house in a long time to get a feel for what’s happening in the trenches. And not just any open house, and entire open village. Little did I know how much of a treat it would end up being. On the way to Millenium Water, I passed by an abnormal quantity of For Sale signs. I kept asking myself how Rennie is going to pull off a 474 condo sale when inventory is exploding and sales are faltering. But soon after I walked into the gates of the Olympic Village, I knew I had stepped into a dream world of magic.

If Vancouver ever had a ground zero for Irrational Exuberance, Millennium Water is it. And if Bob Rennie is ever the King of anything, it’s hype. The man has carefully orchestrated a circus of clowns, bands, tents, treasure hunts and euphoria. When bands are cheering on lined up speculators and the King himself is handing everyone cookies, what is being witnessed is the last “hurrah” of a heavily inflated market. I lined up to view a condo and couldn’t help but overhearing what the herd was chanting. One of my favourites was, “I don’t know if I like this area, but I love the wave pattern on the wall.”

I followed the crowd into a staged 1 bed, 2-den condo at slightly over 1,000 sq. feet. I overheard some lady asking an agent the price and he replied with a straight face: “One-point-three-million.” The lady’s jaw dropped, she shook her head, and moved on. I couldn’t contain myself and had to keep the conversation going.

– Me: “The miracles of record low interest rates. So that’s roughly $1,200 per sq. ft?”
– Agent: “Yes, but I’m also selling units down the street for $500 per sq. ft”
– Me: “So why, in your opinion, does this place come at a $700,000 premium?”
– Agent: “It’s an opportunity to be a part of this famous community and the proximity to the water.”
– Me: “Not only are you asking for an outrageous premium, you’re doing it at a time when there are over 18,000 units on the market, CHMC rules are tightening and mortgage rates are climbing.”
– Agent: “You should then really consider the units we have listed down the street.”

So I followed the yellow brick road down the street and into another Rennie building called “The Maynard’s Block.” And sure enough, studios were priced at half a million. Buy now, or be priced out forever. “

“For 8 years I have managed 14 condo properties in Vancouver. All of the investors suddenly listed their properties this last month.”

Strataman at 15 Mar 2010 9:09 pm

“For 8 years I have managed 14 condo properties in Vancouver, all owned by investors who are somewhat more well off than me!  All of the four investors suddenly listed their properties this last month. They all know each other (thus my management contract) yet not ONE listed during the 2008 downturn.”

Update 2 Apr 2010 8:29 am -“As a sideline for almost 8 years I have managed 14 properties for long term investors in Yaletown looking after the rental agreements. They are four independent investors, every one of them is now listed, never before have they listed even one. These people have lots of room to move with over 50% equity in all of them. They have said they will be out of the market by July 1st, and I know they can do it. Their competitors have little room to move, these people have already indicated they have missed the top but are not worried, they quadrupled their investment even if they drop 10 % from this months prices.” and more at 8:59 am “Okay I should admit there is a downside to my comment # 5. I am one of the tenants arggghhh! And as they pretty well covered my rent ( I pay net $400.00 for a 1 bedroom in a really upscale condo…) I am faced with the ridiculous possibility of having to pay $1500.00 a month!!!!! if some newbee investor buys this place. Arggghh stress city!”

“I have heard from a few realtors that it has been slow on the buyers’ side since the Olympics.”

junius at 9 Mar 2010 12:56 am – “I have heard from a few realtors that it has been slow on the buyers side since the Olympics. I had thought it would stay hot until the April 19 rule change. However it looks like most of the buyers have dried up before the party ended. Only 5 more weeks to go. [until changes in mortgage qualification requirements].”

Olympic Consumer Spending – “Canadians themselves were the high rollers for total spending, representing 78.4 per cent of all transactions.”

Canadians opened their wallets for Vancouver’s Olympics, Vancouver Sun, 4 Mar 2010

“We saw a big surge in spending after Canadian athletes won their gold medals,” said Santo Ligotti, a spokesman for Moneris. Moneris processes about 40 per cent of electronic transactions in Canada, including those of Visa, MasterCard and American Express.

Canadians themselves were the high rollers for total spending, representing 78.4 per cent of all transactions.

Post Olympic Job Losses – “The show’s host had to ask her several times how many people were hired who will now be out of work. After much dodging she finally came up with a ballpark figure. Over 50,000”

bestplaceonmeth at 2 Mar 2010 at 5:31 pm“I was listening to a spokesperson from Adecco Employment Services on CBC this morning, they’re the ones who hired people for the Olympics. The show’s host had to ask her several times how many people were hired who will now be out of work. After much dodging she finally came up with a ballpark figure.”Over 50,000″ was her answer.”

Olympic Visitor, Foreign Buyer? Part 6: “I know of one condo sale to a couple from San Jose. I’m going to assume we’ll see a mini-wave of these kinds of purchases, but the effect will be minimal.”

raventalk at RE Talks 2 Mar 2010 9:17 am“Those of us living at 1155 Seymour were flooded with pre-Olympic requests to list our condos and I know of one sale to a couple from San Jose. I’m going to assume we’ll see a mini-wave of these kinds of purchases, but the effect will be minimal.”

Olympic Visitor, Foreign Buyer? Part 5: “Aspac Developments says it sold $31.8 million in high-end units to people visiting Vancouver for the two-week duration of the Games.”

One $22.3M sale, and five or six others averaging $1.5M. “Sold $31.8 Million in high-end units” sounds more impressive than “Sold seven units”.  Is this the beginning or end of something? -vreaa

This from ‘2010 visitors buy $32M in Vancouver real estate’ by Darcy Wintonyk,, 1 Mar 2010, 3:11 pm“Aspac Developments says it sold $31.8 million in high-end units to people visiting Vancouver for the two-week duration of the Games. The penthouse at Three Harbour Green alone, within spitting distance to the International Broadcast Centre and nestled on the shores of Coal Harbour, sold for $22.3 million. A spokesperson for the developer said the warm weather helped showcase Vancouver’s natural beauty and showcase it to the world.”

This pertinent comment from Anonymous at 1 Mar 2010 at 5:12 pm – “Friends and fellow citizens, that article is bullshit. The suites downtown in Coal Harbour, and several at the Wesbrook at the University of British Columbia, were being advertised overseas to Asian buyers only….not olympic visitors. The wealthy asians that purchased these homes use these residences as secondary when they visit canada but many have their children living in them and attending university. How do I know this? My client was part of the team responsible for building the tower at UBC. He told me that not one single advertisement was pushed in north america.”

Vancouverites In ‘The Guardian’ – “It may be expensive to live here; housing is very expensive. It took HARD WORK to buy a house, but we did it. We will continue to make sacrifices so we can live here.” … “I am an immigrant to Canada, and I am lucky enough to live in Vancouver because I bought here before it became a world-class city.”

A somewhat lukewarm review of the Vancouver 2010 Olympic Games in ‘The Guardian’ drew comments from individuals living in Vancouver who, not surprisingly, managed to mention real estate prices:

hhcu at 1 Mar 2010 6:26 pm“Vancouver with a mild climate is one of the most desirable cities to live in Canada. Housing prices are the highest in Canada. That is one of the many reasons that we have homeless people. That sounds a bit dismissive, but we also are a city of immigrants, the majority start out working at the basic minimum wage and the majority, if not all, are not homeless. I am an immigrant to Canada, and I am lucky enough to live in Vancouver because I bought here before it became a world-class city. I have lived in and traveled to many so called world-class cities and am always happy to come home to Vancouver, even in the rain which sweetens the air and makes the trees grow, at least a foot a year. The Closing Ceremony was belittled. Who cares! Even the poorest (here often bus drivers “let” some of the destitute gratis on the buses) can take a (wheelchair friendly) 99 bus out to the university forest and see a real working beaver dam, the “organizing committee” being the beavers themselves. No wonder this hardworking little animal is venerated here. Now we have the Para-Olympians to look forward to. As for the bill? It is a heck of a good party.”

ProudCanuck2010 at 1 Mar 2010 7:15 pm – “I am a proud Canadian, that has also lived abroad in Tokyo, and have travelled to many cities in the world, and I work in tourism/hospitality, and I have experienced racism, challenges with language, and also warm hospitality from my hosts where I visited. So I speak from experience when I say that Vancouver qualifies as a World-Class City. I chose to live in Vancouver for it’s beauty, weather, people, culture, and diversity and have called this home for 15 years after my travels abroad because it what it offers. BC residents are the healthiest in Canada, we get to look at those beautiful mountains, whenever the clouds lift, and we wait patiently and happily for those days, and live in the most liveable city in the world. And in my job, I speak with visitors EVERYDAY of how they fall in love with our city, and our province, and can’t wait to come back. It’s on the list of “Things to do before I die” for many. It may be expensive to live here, and housing, admittedly is very expensive. But we worked hard to buy a house, and it took a few years, but we did it. But it took HARD WORK, and we will continue to make sacrifices so we can live here. We could have moved to a city and found a job where it wasn’t so expensive, but we want to live HERE, and that is the price you pay. I imagine if I chose to live in other “World-Class Cities”, it would not be any different. New York? Tokyo? The same! Viva la Vancouver! It rocks!”

“A local realtor passes and says: “Every time those cameras click real estate goes up $100”

Eric at 27 Feb 2010 bemoans the fact that fine weather for part of the Olympic Games may have given visitors an artificially rosy view of Vancouver –

“Instead of 4°C and raining sideways, we got the once-in-five-years treat of a sunny, warm February. I was really hoping for the rain, really and truly, because anything else was bound to add to the silliness that is Vancouver real estate. So, there I am watching a week of stunning sunrises from the Cambie bridge, surrounded by hundreds of visitors at 6am, who flocked up the span with cameras in hand. A local realtor passes and says: “Every time those cameras click real estate goes up $100″. Sigh. March Madness is around the corner. … And THEN the bloody cherry trees started blooming.”

Overstretched; Living In Debt… And We Haven’t Even Started To Crash Yet.

pricedoutfornow at 26 Feb 2010 9:43 am“I went to an Olympic event yesterday and happened to hear some people behind me talking. They were from Nova Scotia, the person said “We’re never going to do this again, so we’re spending like there’s no tomorrow, really racking up the credit card! But it’s a once in a lifetime opportunity, so why not?”

Vansanity at 26 Feb 2010 10:33 am – “I know tons of people doing exactly that! They’re partying hard and the common theme amongst them is that they’re not going to worry about what their credit card statement looks like until its all over! It should be interesting to see the debt figures come up a few months from now. Also, I know someone who recently bought a home and is now $700k (+) in debt. His family income is somewhere around $100-125k per year. Couple kids, $3,000-$4,000 per month on house costs. Financial stress, mental stress, physical stress… sounds like a great plan. I should mention that they both came close to losing their jobs sometime ago. I’m so happy I’m not living “house poor”. We’re planning our vacations for the year, looking at 4-6 weeks away, Europe, Hawaii and Jamaica, few trips to Vegas in between to maintain the tans. It’s really rough being a renter.”

Update: Vancouver IS the best place on earth; Everybody WILL want to move here: “The gods are on our side when it comes to real estate. The Vancouver boom is not over. It is just starting.”

Vancouver did indeed look glorious, on cue, for at least part of the Olympic fortnight. This causes the following reassertion of the theory that overwhelming demand will drive our RE prices forever upwards. These foreign buyers would have to be oblivious to pricing levels as defined by fundamentals, and they certainly wouldn’t want to be in need of local jobs to support their RE habits. -vreaa

Vancouver Rocks at 27 Feb 2010 1:32 pm

“The gods parted the skies and released unseen sunshine for 10 straight days rather than the usual rain and fog. And the cherry blossoms all came out. This despite the negative nellie bears that were wishing and hoping for terrible weather. Over a quarter million visitors were taken aback by the beauty, and many commented right on cue “Oh, everyone will want to move here.” Obviously, the gods are on our side when it comes to real estate. Looking forward to another 10% pop this Spring, which will make an increase of over 30% in the last year and a half. Hmmmmm….waiting for a 15% “correction” after a 30% increase took place is just a waste of time and rent….. The Vancouver boom is not over. It is just starting. All it will take is a couple of thousand visitors to buy, and the already low inventory will be eliminated. Sorry bears, but Vancouver will continue to go up and you will continue to be left behind…”

Olympic Visitor, Foreign Buyer? Part 4: “Those opening ceremonies – that should add $25 a square foot to what I can get at the village.”

The author of the article cited below was unsure as to whether Bob Rennie was really kidding or not with that statement. -vreaa

Excerpts from ‘Banking on the Games afterglow’, by Frances Bula, The Globe and Mail, 22 Feb 2010

“The reality is that many are hoping there’s an element of truth in Mr. Rennie’s humour. Among them are brothers Peter and Shahram Malek who run Millennium Developments and who pledged $70-million of their assets to keep the athletes village project going when their financing started to collapse at the beginning of the recession. Another group is the City of Vancouver, which is owed almost $200-million for the land and was forced to loan the Maleks $800-million for their construction refinancing. Both are depending on a healthy real-estate market to recoup the village’s $1-billion cost. It would be a relief if the reflected glory from the Olympics would make a difference once the athletes go home.”

“Certainly the village, after a year of rocky news coverage, has been basking in the Olympic glow. A recent New York Times Magazine essay on the Games by Liberal Leader Michael Ignatieff was accompanied by a picture worthy of an architecture magazine. The site looked like a modernist marvel on the water. Television shots frequently highlight it. Media outlets report that athletes love it.”

“The problem with Millennium is their costs,” says Cameron McNeill, another major development marketer who points out that the village was built at the peak of prices for labour and materials. “Will the market bear the $1,100 a square foot they need? I think that’s stretching it. I think it’s going to be extremely difficult for them to recoup their costs.” Mr. McNeill, the head of MAC Marketing Solutions, is selling a building across the street from the village, the James. He’s pricing it in the $700-a-square-foot range. That’s the average price Mr. Rennie got for the first 250 village condos before the crash. It means the remaining 500 condos have to sell for much more on average for the project to break even.”

“We are a brand society and Vancouver doesn’t have a lot of legendary addresses,” Mr. Rennie says.

Olympic Visitor, Foreign Buyer? Part 3: MSNBC RE Coverage: “Warning: Don’t count on bargains because Vancouver’s home values have recovered and already are back at 2008’s peak levels.”

This from raventalk at RE Talks 22 Feb 2010 11:25 am“Watching the Olympics last night on CNBC and there was a ten minute feature on Vancouver real estate. The gist of it was Vancouver is a great bargain compared to other “world class cities.” This coming from a real estate agent from New York who is visiting the Olympics and now is looking at buying since “prices seem stable here (Vancouver.)” Also found this link on”

‘Northern exposure’, by Jennifer Alsever, contributor, Business/RE section,, 21 Feb 2010“Are you becoming enamored with Vancouver’s Olympic glory? Or maybe you’d rather stroll down Robson Street for the closing ceremonies rather than watch it on TV. Here’s a look at what’s for sale in Canada’s third-largest city. Warning: Don’t count on bargains because Vancouver’s home values have recovered and already are back at 2008’s peak levels. All prices are in Canadian dollars.”

Olympic Visitor, Foreign Buyer? Part 2: “CBC spoke to a realtor who had four phone calls since the Games started. One party was American, interested in purchasing a property in Vancouver.”

Stories of visitors to the Olympics buying RE in Vancouver. Or not. -vreaa

pricedoutfornow at 21 Feb 2010 11:24 pm“CBC radio reported today that realtors are bored, sitting at home, watching TV during the Olympics. Apparently international visitors are too busy enjoying the games to think of investing in real estate. Who woulda thought??? Though they did point out one realtor who had an amazing FOUR phone calls since the games started. This realtor revealed that one party was American, interested in purchasing a property in Vancouver. I bet the Americans slammed down the phone after hearing the price of condos in our fair city.”

Olympic Visitor, Foreign Buyer? Part 1: “I was talking to a Swedish flight attendant at the Irish House last night. She was considering buying a condo in downtown Vancouver.”

Vancouver is looking glorious again today. Despite this, we don’t think there are going to be many Olympic visitors who decide to become foreign buyers of Vancouver RE. Our prices are simply too preposterously high, and those who live in other cities will be more aware of that than locals. We are, however, interested in any evidence that may prove us wrong. So far, we’ve had to be satisfied with the following insubstantial anecdotal snippet. Please send your stories, if there are any. -vreaa

This from vantownsucks at 19 Feb 2010 10:02 am“I was talking to a Swedish flight attendant at the Irish House last night and, I’m not kidding, she was considering buying a condo in downtown Vancouver. She said she loves Vancouver. I was shocked I must say.”

Olympic Village Not Up To European Construction Standards – “The walls are as thin as curtains.”

Olympic visitors are puzzled. Those familiar with bricks and mortar find our construction practices odd. And some are labouring under the delusion that we have dry summers. -vreaa

‘Athletes and coaches slam Olympic Village accommodation’,, 12 Feb 2010

“Disgruntled athletes and coaches staying at the Olympic Village in Vancouver have hit out at what they say is shoddy accommodation and a lack of basic comforts.”
“The walls of the rooms are so thin that the athletes are struggling to fall asleep.”
“Ski jumping trainer Werner Schuster compared the Olympic Village with a boy scout camp.”
“The walls are as thin as curtains.”
“The Village is good for summer. But now in winter with this weather it’s a problem. The German team have especially bought heaters to dry their things which are always getting wet due to the relentless sleet.”

Visual Group Anecdote – 50% of Construction Jobs Will Disappear

Employment growth in BC over the last decade has been solely related to the housing bubble and the closely associated Olympic construction projects. At one point in 2008, the number of individuals involved in construction represented 250% of what one would expect under more normal market conditions. This chart is from the indispensible local RE blog, Housing Analysis, run by bloggers jesse and mohican. In a 7 Feb 2010 post, they predict that, with “the continued completion of construction projects through the spring and summer”, the number of construction jobs will drop from current 200K to the 2001 levels (100K), very rapidly. We agree with this outlook. -vreaa


No Such Thing As Bad Publicity? – Associated Press, Sports Illustrated, and The Guardian Preview the Olympics

Winter Olympic rings in Vancouver harbour

The story of the Vancouver RE boom and the fantasy of Olympic glory have long been attached at the hip. We thus continue to monitor Games sentiment. Three major international news publications, MSNBC (Associated press), Sports Illustrated, and The Guardian, are currently running remarkably bleak articles on Vancouver and the 2010 Games. -vreaa

From ‘Vancouver’s Olympics Head For Disaster’ by Douglas Haddow, The Guardian 31 Jan 2010

“Just days before the opening ceremony, Vancouver is gripped by dread. Not the typical attitude for a host city, but understandable when you consider that everything that could go wrong, is in the process of going wrong. … In the mid-2000s the games were originally slated to cost a pittance of $660m and bring in a profit of $10bn. This ludicrous projection was made before the market crash – an event that the Vancouver’s Olympic committee failed to anticipate. … Conservative estimates now speculate that the games will cost upwards of $6bn, with little chance of a return. This titanic act of fiscal malfeasance includes a security force that was originally budgeted at $175m, but has since inflated to $900m. With more than 15,000 members, it’s the largest military presence seen in western Canada since the end of the second world war, an appropriate measure only if one imagines al-Qaida are set to descend from the slopes on C2-strapped snowboards. With a police officer on every corner and military helicopters buzzing overhead, Vancouver looks more like post-war Berlin than an Olympic wonderland. … This manic mix of hype and gloom is a byproduct of the games’ utter pointlessness. … It will be the best chance yet for the Olympics to be derailed and exposed as what they are: a corrupt relic of the 20th century that does little more than gut city coffers and line the pockets of developers and investors.”

From ‘As Olympics Near, People Are Dreading Games’ by Dave Zirin, Sports Illustrated, 25 Jan 2010

“The International Olympic Committee has leased every sign and billboard in town to broadcast Olympic joy, but they can’t purchase people’s faces. It’s clear that the 2010 Winter Games has made the mood in the bucolic coastal city decidedly overcast. … I spoke to Charles, a bus driver, whose good cheer diminished when I asked him about the games. “I just can’t believe I wanted this a year ago,” he said. “I voted for it in the plebiscite. But now, yes. I’m disillusioned.”… A sports reporter from the Globe and Mail said to me, “The optics of cuts in city services alongside Olympic cost overruns are to put it mildly, not good.” … Bringing together a myriad of issues, Vancouver residents have put out an open call for a week of anti-game actions. … Expect a tent city, expect picket signs, expect aggressive direct actions. Tellingly, according to the latest polls, 40 percent of British Columbia residents support the aims of the protesters.”

Image: East Hastings Street

[Photo caption] ‘Welcome to Downtown Eastside. Here, life is gritty, volatile and the slightest misstep can invite brutal retaliation.’

From ‘Canada’s Olympic City Has Notorious Skid Row’, Associated Press, at msnbc 30 Jan 2010

Happy Smiling Buildings? – Subtle Signs Of A Distorted Vancouver RE Market In An Olympic Children’s Book

Imagine that you are an artist illustrating a children’s book. The story involves three magical, animated creatures adventuring around British Columbia in preparation for a big sporting event. You decide to portray some creatures and objects as having human emotions, by giving them smiley faces. The story is set in places of great natural beauty: the seas, the beaches, the forests, the slopes, the campgrounds. The creatures (a ‘sea-bear’, a ‘sasquatch’ and an ‘animal garden spirit’) are rooted in folklore that reveres nature. The year is 2010, the world is preoccupied with the environment. . It would be natural for you to animate the mountains, trees, oceans, islands… right? Well, yes, maybe you would, if all else were equal. If, however, you were living in a society obsessed with its profoundly over-inflated real estate market, you’d be moved to animate the buildings. Yes, the buildings. See below for the animated entity scorecard. Trees 1; Highrise Buildings 27. Subtle point? Perhaps. But a preposterously distorted real estate market does effect a society in innumerable subtle ways. -vreaa

From ‘Miga, Quatchi and/et Sumi’: ‘The Story of the Vancouver 2010 Mascots’ by MEOMI (Vicki Wong and Michael Murphy) –

Entities With Smiley Faces Scorecard:
Seaweed 7
Starfish 1
Octopus 1
Mushrooms 7
Bridges 2
Trees 1
Highrise Buildings 27

Excerpt – “The glass buildings of Vancouver shimmered with light…”

“Over the last year I’ve talked to many investors who’ve consistently told me they’d be selling their extra properties after the Olympics.”

In a bubble, everybody assumes that they’ll be able to sell near a top. Less than 3% of participants will get to do so. -vreaa

This from eyesthebye at RE Talks 25 Jan 2010 7:10pm

“Over the year leading up to the Olympics I’ve talked to many “investors” who’ve consistently told me they’d be selling their extra properties after the Olympics. With the wave of listings the first 3 weeks of this year, are we seeing the effects of this investment strategy now?”

Olympic Cruise Ship Hotel: Room Prices Dropping: US$1,300 … $US$585 … US$275

How can we create a temporary hotel? Let’s park a cruise ship, rent out the rooms, and make a killing. Oooops. -vreaa

These excerpts from the Vancouver Sun 23 Jan 2010

“Cruise ship hotel cuts prices further. Operators of the Norwegian Star cruise ship hotel to berth in North Vancouver during the 2010 Olympics have slashed the cost of a basic room from $585 US a night to just $275 a night — and the price may go even lower. The latest discount comes less than three months after a marketing change saw the entry-level room price drop from about $1,300 US a night to less than $600. “We’re seeing brisk sales now, but we have a lot of rooms to fill and want to make sure the ship is as full as possible,” Newwest Special Projects representative Tamara Castellano said in an interview. “The more people on board, the better the atmosphere.” [where, in the Newwest offices? -ed.]

“There is just a heck of a lot of properties out there, so, after the Olympics, there will be a lot of people who haven’t made their bonanza, that are all going to be coming into the unfurnished market, and we will see a huge glut, I think, come March 2010.”

Nicholas Meyer of ‘Downtown Suites’, 24 Oct 2009 (transcribed excerpt from youtube video) –

“The main issue that concerns us as a rental management company is the amount of product that is now on the market, as so many people are now renting their suites out. We have got the Olympics coming in just a couple of months from now and everybody is hoping to cash in on the bandwagon and make a fortune. …. It isn’t necessarily going to be such a fantastic cash cow. “

“There is just a heck of a lot of properties out there, so, after the Olympics, there will be a lot of people who haven’t made their bonanza, that are all going to be coming into the unfurnished market, and we will see a huge glut, I think, come March of next year. [2010] Thousands of units are still completing but the positive side of this is we are keeping the rents at a stable level “

Bob Rennie Tells Chinese Customers Vancouver Prices Will Keep Rising

These excerpts from ‘Vancouver property still good buy for post-Olympic era’ at 17 Jan 2010

“Bob Rennie, principle of Rennie Marketing Systems, Canada and USA, told Xinhua in an exclusive interview that Vancouver properties would conservatively rise 4 to 4.5 percent in 2010, which would present an ideal opportunity for investors.”

“Vancouver is going to face a shortfall of apartment units following its hosting of next month’s Winter Olympics Games, said the realtor known as the city’s “CondoKing”

“Rennie predicted by the first quarter of 2011 the shortfall in apartment units would be noticeable in downtown Vancouver as there were very few major sites left to develop. Also, with a lot of “money on the sidelines” earning low interest, this coupled with a low supply of available properties, would put pressure on the market”

“Regardless, Rennie said Vancouver was still an affordable city by world standards and a good investment. “The unique thing about Vancouver is nobody builds rental towers (anymore). For the offshore investor properties are easy to rent out as there is no rental stock.” Unlike China where real estate speculation is rampant, Rennie added in Vancouver it was “more passive speculation” with investors buying for the long term. “Every market has people who want to jump in and jump out, but there is something unique about Vancouver that once people get their name on title they tend to hold and that’s what maintained prices. And a very low vacancy rate has maintained prices on property prices.” With Chinese-Canadians about 300,000 of the city’s 2.2 million population Rennie said Asian investors were increasingly an important factor to the market, accounting for about 25 percent of the overall sales. “With the amount of money being made in China, and with the acceptance of China to Vancouver, we have to be in the top two places on the planet for China to look at, to move money to. We see it happening right now, it’s happening a lot. It used to just happen in the luxury market, now it’s happening in all the market.”