Most Recent Comments:
- CaptainCalamari on Vancouver RE – ‘Heaven’ At A ‘Perfect Price’
- kabloona on Canadians Owe More Than $1.5 Trillion; Up 7.4% From 2013
- Bambi on “Forget The Eights, Let’s Just Sell The Place.”
- Marco Bitran on Gord Goble in Local Newspapers – Vancouver RE ‘House Of Cards’ Will “Implode”
- 3rdRock on Canadians Owe More Than $1.5 Trillion; Up 7.4% From 2013
- Whipmaster~Kerthwhack on Hoocoodanode?
- Whipmaster~Kerthwhack! on Hoocoodanode?
- Whipmaster~Kerthwhack! on Hoocoodanode?
- Whipmaster~Kerthwhack! on Hoocoodanode?
- Whipmaster~Kerthwhack on Canadians Owe More Than $1.5 Trillion; Up 7.4% From 2013
- 3rdRock on Canadians Owe More Than $1.5 Trillion; Up 7.4% From 2013
- BlaMmO on Canadians Owe More Than $1.5 Trillion; Up 7.4% From 2013
Type of Anecdote
- 01. He Said, She Said (248)
- 02. Profiting from the Boom (446)
- 03. Changed my Life (106)
- 04. Changed my Career (39)
- 05. Where do Buyers get the money? (990)
- 06. Held my Nose and Leapt (97)
- 07. Avoiding Vancouver (377)
- 08. Overextended Buyers (1,197)
- 09. Delaying Buying (316)
- 10. Demoralized Renters? (367)
- 11. Regrets about Investing in RE (417)
- 12. Effects of Development (276)
- 13. 2010 Olympics Related (74)
- 14. Social Effects of the Boom (1,262)
- 15. Misallocation of Resources (964)
- 16. Missed The Boat? (236)
- 17. The Froogle Scott Chronicles (27)
- 18. Spot The Speculator (171)
- 19. BlastRadiusPostCards (17)
- 20. The Limitless Demand Argument For Ongoing Market Strength (70)
- 21. Vancouver RE-Verse [Found Poems] (8)
- 22. RE References In Popular Culture (44)
- 23. Jumping The Shark (1)
- 24. Policies On Housing (11)
- 25. Epigrams For The Bubble (1)
- 26. Premature Calls Of "Bottom" (3)
- 27. Seller Panic (3)
- 28. Erroneous Causation Theories For Falling Prices (7)
- 29. Bubblespeak (1)
- Uncategorized (177)
- Canadians Owe More Than $1.5 Trillion; Up 7.4% From 2013
- Vancouver RE – ‘Heaven’ At A ‘Perfect Price’
- G&M – “Canada’s housing bubble about to burst, author says”
- Bank Of Canada Induced ‘Havoc’, Plus Bits & Pieces
- In Case You Thought Our Bubble Was Due To Special Local Factors…
- Interest Rates Held Far Lower Than Necessary Cause Speculative Bubbles
- ‘A decade ago 40% of all purchasers in the States were first-timers. Today is it 27%. In Canada the number exceeds 50%, and is rising.’
- ‘Canada’s moment as an economic standout is over.’
- ‘The Extra Breadwinner In The Family’ – ‘Does your house make more than you?’
- ‘Extreme Speculation’ – “The problem is that the diversion of resources into investments that are only justified by the stream of new money and artificially low interest rates will destroy wealth at the same time as it is boosting activity.”
- “It won’t last. It just prepares the way for the bust. It forces out real businesses. And it drives out people who find themselves financially unable to live here any longer.”
- ‘Vancouver Affordable Housing Agency’ Created By The City
- Enter Inflation, Stage Right
- Average House Price In Canada Rose 7.1% YOY
- Vancouver School Trustees Threaten Risk Of Property Price Drops In Debate Concerning Rights Of Transgender High School Student
- House Painting
- Wage To House Price Ratio Is A Changin’
- No, Not Karl Marx; That Other Mark, Mark Carney – “Just as any revolution eats its children, unchecked market fundamentalism can devour the social capital essential for the long-term dynamism of capitalism itself.”
- The New Yorker – Vancouver RE As A ‘Hedge'; “Zombie Neighbourhoods”; “The rest of us better get used to being tenants”
- “On my block, there are three empty million-dollar houses. Property values are skyrocketing. It is a disaster for people who want to live in Vancouver.” – Charles Hou, retired social studies teacher
- Vancouverites have ten times the personal debt of people in the ‘debt capital of Britain’.
- ‘How badly would you be hurt in a housing market price correction?’ [The Globe and Mail]
- A Veterinarian’s Dilemma – “Living in a 300-square-foot closet, moving to northern B.C. or renting for life.”
- Vanc RE, No change – “..really mildish weather that’s very livable..”
- “No problemo. 69 per cent of the condo tower is pretty stable.”
- Still Dead
- BC Premier: “I think the market’s good, it’s a buyers market. I want to make sure I get in before prices start to rise.”
- “You’ll have to pry my cell-phone from my cold, dead hand….” [Off-topic, but irresistible]
- Mayor Robertson Selling His House
- “Nothing Wrong Here!”
- “We spoke to a friend of ours yesterday. Even though she has purchased a house, she wants to keep (and rent out) the condo she’s living in, because she thinks prices will only go up.”
- Families With Children Leave Vancouver – “We bought a townhouse in Port Moody in 2006, sold it in 2011 and bought a house. We couldn’t have done that in Vancouver. Absolutely not.”
- The Economist on Land Taxes – “Taxes on immovable property are the most growth-friendly of all major taxes.”
- “It’s kinda funny that 3 unrelated Irish blokes all said that this mess in Vancouver/Canada RE is unfolding EXACTLY like the mess did in Ireland, one headline at a time.”
- “I was really fortunate with how things worked out for me in real estate. I definitely took chances when I bought a few presale condos to flip back in 2004, but I was adamant at the time that there was room to grow for Vancouver.”
- Making Sense Of It All
- “I have been contacted by two of my realtor friends in the past week both proclaiming that the market is turning and that this is a good time to buy.”
- Trump on Vancouver – “Your people, they go to New York, they go all over the world, and they speak so highly.”
- ‘Canadians obsessed with real estate, poll suggests’ – “Just as many people reported talking about real estate on a regular basis as they did about hockey.”
- ‘Doomed’? – “Home prices in Canada are now double what they were in the 1970s in real terms. Historically, over the very long term, real home prices tend to be flat.”
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A 6.7 Richter earthquake occurred off the west coast of Vancouver Island today at 12:41pm, felt in Vancouver. Buildings swayed “from Fraser Valley to Campbell River.”
“I was watching the U.S. Open Tennis downstairs and while sitting on my couch I felt it beginning to move back and forth…. It didn’t frighten me… but it took my attention off the tennis match for a few minutes.” [David Dickinson, Courtney]
– CBC News, 9 Sept 2011
12,000 Jobs lost in BC last month.
– News 1130, 9 Sep 2011
The Richmond RE market has very definitely softened year over year:
#Sales: 2011-8 (2010-8) : % Change
Detached : 95 (124) : -23%
Attached : 69 (84) : -17%
Apartments: 96 (127) : -24%
New Listings 2011-8 (2010-8) : % Change
Detached : 251 (165) : +52%
Attached : 165 (125) : +32%
Apartments: 244 (205) : +19%
– via VMD, vancouvercondo.info 9 Sep 2011
‘The Province’ quoted David Madani’s ongoing sensible (but conservative) prediction of a Canadian housing price correction of 25%.
– The Province, 9 Sep 2011
“I made the move when the market was sleeping. I own my home free and clear. It’s taken a long time, but I do know where I came from and how I got here.”
This from craigslist: ‘British Properties (North Shore)’, 2011-06-20, 8:02AM PDT [hat-tip ‘B’] –
“I’ve been here [in the British properties] for 30 years…. I used to live in Langley, but after high school I worked at a garage repairing cars and pumping gas. I saved a little, opened up a semi-successful firm of my own, went bankrupt through no fault but my own, happened to start-up again, scrimping and saving all the while raising two children (one of whom passed away rather early) and made the move when the market was sleeping. I own my home free and clear. It’s taken a long time, but I do know where I came from and how I got here. Sure it’s just a modest house with a fairly nice view.
So [for some to say] that the Chinese are taking over British Properties without ever living here, really pisses me off. But hey, you’re entitled to your opinion. Just take it from someone who actually lives up here. And know, I’m not some twisted rich snob who looks down on the rest of you, I’m just a regular guy who happend to one day find himself living somewhere else. I’ve earned it. So has anyone who owns their own home, be that on the North Shore, in Langley, Surrey, Coquitlam or Delta.
And by the way, I’m a second generation Canadian. And proud of it.”
The legacy of the ‘Stanley Cup Finals and Vancouver Riots of 2011′ may well end up being the ensuing social debate. We’ll here collect links to representative opinions, and other articles of interest. [This post will be updated with further readings; Please post suggested links, quotes or subjects in the comments. -ed. ]
Theories of Causation (not mutually exclusive):
2. Widespread Deep-Seated Societal Problems
– Adrian Mack and Miranda Nelson, Georgia Straight
– Froogle Scott
5. Bad Parenting
6. Mob Mentality/Madness of Crowds
– Chronicle Herald
7. Poor Planning by Authorities
– Calgary Herald
8. The Inherent Violence of Hockey Itself
Other subjects of interest:
Concerns About The City’s Reputation
“.. a huge black eye for the city of Vancouver” – James O’Brien, online hockey writer, NBC Sports
Comparison with the Olympics:
– Not So Different: Christie Blatchford
Comparison with G20 T.O.
– Different: Toronto Standard
VPD response, Globe and Mail.
Police Chief acknowledged mistakes, 17 Jun 2011, Nat.Post
“Mayor Gregor Robertson was a little naive. He wanted these live events. He wanted a great big fun city.” – Leo Knight, former Vancouver city cop and RCMP, chief operating officer Palladin Security.
Debating the blame, 21 Jun 2011, G&M
The Effect of Social Media
– Globe and Mail, ParsonsBlog
– “…the massive online reaction to the Vancouver riots is unprecedented and as groundbreaking as WikiLeaks.” – Christopher Schneider, a UBC sociologist
“For reasons I can’t really explain, I went from being a spectator to becoming part of the mob mentality that swept through many members of the crowd.”- Nathan Kotylak (pictured above)
“A UBC student photographed leaving Black & Lee Tuxedos with a piece of clothing in her hands has been called out online by one UBC donor, who is threatening to pull his annual donation if she isn’t expelled.” – Vancouver Sun, 19 Jun 2011
“Alex Prochazka, 20, a professional mountain biker, was photographed during the riots with a T-shirt emblazoned with the name of a sponsor. He has since lost multiple sponsorship deals and told The Sun, “I didn’t go there for the riot, I went for the hockey game and got caught up in the hysteria of it afterwards.” – Vancouver Sun, 20 Jun 2011
Backlash Against Social Media and Public Outings
“The online forums have gotten pretty ugly. It enables a whole dark side of our psyche to go public … it’s too bad and I hope it turns around quickly.” – Mayor Gregor Robertson
“I don’t think we want to live in a society that turns social media into a form of crowdsourced surveillance.” – Alexandra Samuel, Harvard Business Review
– Georgia Straight
The “Citizens’ Wall”
Healing? Penance? Purification? Blaming?
“Mayor Gregor Robertson says the city has been in touch with merchants and asked them not to throw the plywood away, while archival staff consider ways to save what he calls “these pieces of history.” – G&M 19 Jun 2011 [This just 4 days after the riots themselves. An attempt to instantly manufacture a palatable history. -ed.]
Notice How Nobody Is Talking About The Hockey Result
“I would like to congratulate the Boston Bruins on a game well played for the Stanley Cup.” – local Canuck fan
– ‘Ballad of Brock Anton’
– ‘You Gotta Be Here’
The Froogle Scott Chronicles: Mortgaging Our Souls In Paradise – Part 9c: So You Want to Buy a House and Fix It Up? Thirty Suggestions for Survival
Part 9c: So You Want to Buy a House and Fix It Up? Thirty Suggestions for Survival
[30 suggestions over 10 sub parts, starting with Part 9a. -ed.]
8. Water — the enemy
Remember this mantra: Water is a house’s worst enemy. — Tom Silva, This Old House
Vancouver was carved out of a temperate rainforest. The forest is gone, but the rain is still here. It’s what keeps everything green and allows the remaining trees to grow large, but it also represents a constant assault on the integrity of houses. The frequency and duration of rain in Vancouver is the real problem for houses and wood-frame condos, rather than the total amount of rainfall. Instead of intermittent cloudbursts that dump a lot of water in a short time before the sun reappears, drying out everything, rain in Vancouver tends to be an all-day or all-week affair. Drizzly, misty, fine rain alternating with overcast skies means that buildings can stay damp for long periods of time, which coupled with mild temperatures is exactly what promotes mould growth and rot.
One way of looking at a house is as a water-resisting structure, or perhaps more accurately, a water-management system. Most of us would think first about the roof, but in some ways roofs aren’t the main problem. They’re specifically designed to resist and shed water, and if properly built and maintained, do their job well. Problems that do arise tend to be with roof penetrations for vents, chimneys, or skylights, and improperly installed or poorly maintained flashing and caulking. But everything’s exposed, so finding and fixing problems is usually straightforward.
If you’re buying a house, one thing to be cautious about is a roof with insufficient overhang — the part of the roof that extends beyond the house wall. Overhangs are important because they prevent water from rain and roof runoff saturating house walls and potentially working its way into the house. Deep overhangs are best. Anything less than a foot won’t be that effective, and even a foot isn’t that much. A roof with little or no overhang may once have had one, but poor maintenance of the roof allowed the edges to rot, and instead of repairing the damage, someone doing a quick roofing job just buzzed away the rot with a saw and re-roofed what was left. Be cautious about buying a house with a compromised or missing roof overhang. In subsequent years water may have penetrated the walls, and rot may have spread through the sheathing and framing. At the very least, rebuilding a roof overhang should be one of the first things you do.
Less straightforward are problems associated with water penetration through walls, through concrete foundations, and around windows and doors — the elements that along with the roof make up the building envelope. One of the veteran house builders who worked on our reno maintained that flawed building envelope design was at the root of the leaky condo crisis. A number of years ago, the BC building code and the Vancouver building by-law were amended to require that all new construction incorporate a vapour barrier on the inside of exterior walls — typically a layer of heavy poly between the drywall and the studs and insulation. The idea was to improve heat retention and energy efficiency, and protect the cavities of exterior walls from condensation, by preventing water vapour from warm interiors meeting cold exterior air inside the wall. However, no change was made to the code regarding the outside of exterior walls. A typical assembly remained wood siding or stucco over a single layer of black building paper over plywood or OSB sheathing. The result was that any water that made its way into a wall from outside, because of a leak, or wind-driven rain, or was present in the wall framing materials during the construction process, now became trapped behind the vapour barrier. Walls could no longer dry to the inside, and given the Vancouver climate, drying to the outside might not happen for days at a time. The veteran builder likened the results to “leaving wet salad in a polythene bag.” It’s why the exterior walls of thirty-year-old condos might be rotting, whereas wood-frame apartment buildings built in the 1940s or 1950s, or hundred-year-old houses, with plenty of air movement through walls that can dry to both the inside and the outside, might be virtually rot-free. (Although being dry because of draftiness isn’t really a solution.)
Once government and industry realized the problem, they came up with the response: the rainscreen, the missing half of the wall assembly equation. A rainscreen is a drainage and air drying layer immediately beneath the exterior siding that cuts off the passageway for water, and drains any buildup to ground. Drainage mat against concrete foundation walls is another development that serves the same purpose — cut off the seepage of water through the foundation and move it to ground. Several other factors contributed to condos rotting in coastal BC, including California-style architecture (flat roofs, no roof overhangs, architectural adornment) inappropriate for the climate. And I’ve omitted some of the more esoteric building science details, because I don’t yet fully understand them. However, sealing up the inside of exterior walls without considering the outside was probably the most egregious of various design issues.
If you’re house hunting, be alert for signs that water is causing problems for a structure. Check the exterior closely for spongy-looking areas, flaking or bubbling paint, or crumbling stucco. Understand that vinyl siding may be have been installed over the original wood or stucco siding, covering up evidence of rot. In preparation for a sale, a house may have been freshly painted, hiding signs of water incursion. Inside, look for water staining on walls, dark, discoloured bottom corners, and tiny black dots of mould. Again, take into consideration a recent paint job. Pay special attention to the basement or lowest level of the house. Spend lots of time there. Breathe in deeply while walking throughout. Does it smell musty or damp? Trust your nose. Put your hands on the walls, especially below the foundation line, where drywall may cover concrete. Does the drywall feel firm and dry, or damp with a hint of softness? If the basement is unfinished, look for white powdery marks on the concrete. This is efflorescence, the salts left from water that has seeped through the foundation and evaporated. It’s not critical if you intend to leave a basement unfinished, but a problem if you intend to finish a basement, potentially trapping moisture that had previously been able to evaporate. If possible, tour a house during a rainy period, when any signs of water incursion are likely to be most noticeable. One of the reasons the peak house selling season is during the months of good weather is that the various symptoms associated with a leaky building envelope are going to be much less noticeable. Lastly, make sure that as part of a thorough home inspection, the inspector goes over the house with a moisture meter.
If it becomes apparent that a house has been losing the battle with water? Flee.
[Further resources/reading, general]
“Weathering the storm”, The Vancouver Courier, no date.
[Further resources/reading, advanced]
“Understanding Vapor Barriers”. Building Science Corporation, 24 Oct, 2006.
9. Find a good home inspector
While learning the basics about a house’s systems is a good idea for any home buyer or homeowner, most people don’t have the time or the inclination to truly delve into the hundreds of details that these systems represent. And even if you do learn a lot from books, or other sources, it’s not the same as years of experience gained scrutinizing the inner workings of hundreds of houses. For that kind of expertise you need a good home inspector, or some other kind of knowledgeable construction industry professional.
During the height of the bidding war frenzy that gripped the Vancouver real estate market in the mid 2000s (with sporadic outbreaks ongoing), it was common to hear of people putting in over-asking offers without any subjects. In a more normal market, a typical subject would be the requirement of passing a home inspection. Incredibly, during this abnormal market, formulating a competitive bid might require that you waive the right to look closely at the most expensive thing you were ever likely to buy. Step in to a massive financial commitment, and do it blind. Foregoing a home inspection is risky behaviour, to put it mildly. It’s rolling the dice, with ten of thousands of dollars, or more, potentially riding on the outcome. In the subsequent years, some of these buyers will have discovered they’ve been burned. Basement walls full of mould, foundations crumbling, whole sections of house frame or roofs rotted out, failing building envelopes, plumbing and wiring systems at the end of their lives, plugged or non-existent drainage, even major structural deficiencies associated with unpermitted work. Big dollars to fix, and after spending those dollars, the house still looks the same on the surface. The stove is still harvest gold, the toilet’s still blue (which may be cool, depending on your aesthetic, but doesn’t do much for resale value), and 1970s paneling still prevails. You don’t feel any closer to achieving your vision for the house, but a big chunk of your budget is already spent. A good home inspection can save you a lot of grief by alerting you to expensive liabilities in advance, allowing you to make a more informed purchase decision, or avoid some purchases altogether.
Unfortunately, the story that’s been emerging in the last couple of years is that there are a lot of incompetent or even unethical inspectors operating. In Ontario, what regulation there has been of inspectors is toothless. British Columbia has only recently started qualifying and licensing inspectors (as of 31 March 2009), which means that previously anyone could hang out their shingle and call themselves a home inspector. And the barrier to entry may still not be that high.
Generally speaking, you shouldn’t use an inspector recommended by a realtor. Either the listing realtor, or the buyer’s realtor. Realtors on both ends of a sale only make money when they close a deal. Deals get closed when subjects such as home inspections are removed from offers to purchase. Home inspectors who find lots of problems with houses are themselves a problem for realtors who want to close deals and get paid their commission. As a buyer, if the problems are legitimate, those are the inspectors you want. Some realtors may be inclined to recommend a ‘realtor-friendly’ inspector with a reputation for passing houses that another inspector might fail. You need to ask yourself which inspector is likely to best serve your interests.
That said, when I asked a realtor during our house hunting in 2003 about a well-known local home inspector, he was scathing. In this realtor’s opinion, this inspector manufactured reasons for failing houses in order to generate additional business for himself. According to the realtor, he’d fail two or three houses, collecting his inspection fee on each one, before finally passing a house for a client.
As well, realtors who are interested in repeat business, good word of mouth, or surviving as realtors once a real estate boom has run its course, know better than to make a quick and easy sale by foisting a piece of junk on an unsuspecting buyer. You need to know whether the realtor you’re dealing with is ethical, or a quick-buck artist who’ll be closing up shop once the easy money is gone.
It’s hard to know where the truth lies. Do your homework. The time and effort required to find a competent, ethical home inspector is time and effort very well spent. And do it early, well in advance of any offer to purchase. Rushing to find an inspector while the clock is ticking on an offer makes it less likely you’ll find a good one.
Inspecting a House: A Guide for Buyers, Owners, and Renovators, by Alan Carson and Robert Dunlop. Toronto: Stoddart, 1999.
The Holmes Inspection: Everything You Need to Know before You Buy or Sell your Home, by Mike Holmes. Toronto: Collins, 2008.
“Think you’re safe from problems when you buy a new home? Think again”, CBC Marketplace, 9 Jan, 2009
“Can you trust your home inspector?”, CBC Marketplace, 8 Jan, 2010
“Homeowners out thousands despite warranty”, CBC News, 16 Nov, 2010.
Coming soon: Part 9d: So You Want to Buy a House and Fix It Up? Thirty Suggestions for Survival – Suggestions 10 – 13.
Part 9 subsections are posted every Tuesday and Friday.
Read them all before you dig up the foundations. -ed.