Rob is now out of time so Chan is BACK!!!
there were 319 new listings yesterday and 116 sales. A Sell/List of 36.36%. Inventory reached 9393 (of which 2498 or 26.59% were over 90s)
Filed under Daily Numbers, Uncategorized
“Rob is now out of time…”
I’d say he’s “out of touch”, too.
Welcome back to the blog Chan!!
Rats! I hate when I’m the last post before a new topic is introduced. Let me re-post this anecdotal for your amusement:
A friend of mine looked at Polygon’s Sakura development about a year and a half ago. Of course, the units were “snapped up briskly”.
Three days ago he got a call from the sales agent for Sakura saying there were “a few choice units still left”. He told her he wasn’t interested. A few hours later, he got another call from Polygon, this time from the Sales Manager, who he suspects remembers him from a previous Polygon transaction in which he bought and discharged the deal within the legal 7-day time period.
Since then, he has been getting at least a call a day from the manager. He expresses his feelings about this as, and I quote, “The woman’s been livin’ in my ass.”
I’ve told him to forward her my hotmail address so I can see the extent of units they have left. I will report back. But I ask, rhetorically, if the units have sold so well, why does she push so hard?
Just curious what message you want to express by selecting “vomitingdog” user name.
Alright! Chan is in da house!
Chan you should wait until at least 5:30pm before you total dailys, as the board is still adding data.
Rob – “I’m not calling recourse a detail in terms of something to ignore. It is, of course a detail in terms of being a constituent part.”
This type of answer is probably why people like Newcomer and others doubt your integrity. It is also why your blog attracts bears who prefer to attack you rather than reason with you. Good luck to you my friend.
Oh no, Rob is doing time? For what?
Thanks Chan – you have put a smile on my face!:))
Paul – these are yesterday’s numbers…
and I also add to the chorus… Go Chan!!
“This type of answer is probably why people like Newcomer and others doubt your integrity.”
Mr. Maxwell, are you new around here?
Vomitingdog, I think we will see evidence of desperation when they star running wall to wall ads.
I noticed today when I checked for weather and traffic, 1130 was running “news” stories on RE more often than the traffic reports.
I suspect those “news” stories were suggested by the sales department to the business editor, but that’s just me a little cynical sometimes.
ooops! i guess me being back definately causes quite a stir considering i’ve already made my first mistake! to make things clear. i meant to write: rob is out of town
thanks for the warm welcome!
And with these numbers the total inventory is now higher than y-o-y in 2007. This is the first time y-o-y inventory is higher since October, 2007.
The 2008 inventory line is shooting up very quickly.
The trend is your friend.
Welcome back. Thanks for the numbers. We junkies rely on them and our day is not complete without them.
Uh oh! Michael Campbell on the early Global TV News at 5:00 flappin’ those gums again about the RE affordability issue.
With a furrowed brow and occasional pursed lips, he intoned that house prices in Canada were, on a national level, less expensive than many other places.
He DID concede, however, that weak GDP growth in the past quarter MAY lead to a retrenchment in prices.
“But, be careful what you wish for. It may be a depression that leads to lower prices”.
Ah, such “foresight”. (He didn’t so much as “allude” to any softening in recent memory)
“The 2008 inventory line is shooting up very quickly.”
Strange, considering we ran out of land a long time ago. Perhaps the inventory will drop when richest people from all over the world will move here after they see us on TV during the Olympics.
Or maybe when all the specuvestors who have just made millions in Florida will use their gains to buy up Vancouver condos.
Or maybe when, Newsflash will partners up with Vanreal and Tqn , and crowd out all those international buyers.
Or maybe it’s just the beginning of the end.
Chan – pls post #s tomorrow as well – thx.
He’s got it “flipped” around wrong. Ironically, it may be that the higher prices (caused by easy credit and RE shilling) that leads to a depression (caused by an artificially induced house price run-up). The recent global RE bubble is what will trigger a depression. Blame the RE market for triggering the depression. If a depression/recession hits, I sure hope that the greedy RE machine (legislators/lenders/developers/marketers/agents) gets the blame it so justly deserves.
“Uh oh! Michael Campbell on the early Global TV News at 5:00 flappin’ those gums again about the RE affordability issue.
With a furrowed brow and occasional pursed lips, he intoned that house prices in Canada were, on a national level, less expensive than many other places.”
Snick, the snake may have a point, the igloos up in Inuit, do help bring the averages down.
If vomitingdog doesn’t do it for you, just call me VD.
oops meant Nunavut,
Cool Guy, be polite, nobody made anything of the fact you are “curious”, not that there is anything wrong with that.
High prices leads to the depression, which leads to lower prices. As Rob says, the cure for high prices is high prices. It’s a cure that’s about as pleasant as chemotherapy.
The inventory in the REBGV is a tiny bit lower than last year. That said… there was 166% more inventory growth this Jan compared to last year.
Full post here:
January 31, 2008 at 5:15 pm
The trend is your friend.”
Brings me to tears how consistently wrong you have been at your analysis of “trends”. Too bad you gave up though, because I hear Guiness now has a registry for “most adamantly wrong RE forecaster”.
Which forecast did I make? I always said that prices will correct. I didn’t say when. Perhaps that distinction is too challenging for you to understand.
PaulB: Thanks for the numbers. I was going with the ‘chipman area’ which as you know is distinct from the REBGV area.
AmPa “Brings me to tears how consistently wrong you have been at your analysis of “trends”. Well it beats being wrong about in life in general and economic history lessons. People who re-invent the wheel like you tend to think the are unique, does Guiness have an award for the person least likely to learn from repeated mistakes? Cause your a winner! 🙂
nice to see you still follow Vancouver.
I wonder what some of these jokers will say when the market eventually corrects….
Last year: Jan 30th 2007:
“There were 9,253active listings in my target area today, of which 3,103 or 33.54%, had been on the market at least 90 days.
0.82% of all active listings in my target area had their prices reduced today.”
It’ll probably be like the dotbomb–wherein (sorry for the $2 word) the people I know for a fact lost money went around afterwards claiming they had seen it coming all along.
have you ever considered starting your own blog?
the characters that would hang out there would be quite interesting……
…also mr maxwell i dub thee Sir Pitbull…
my impression is you rattled ol’ robs’ cage on the
mortgage info …too funny
mr. goldbug himself….!
what a hoot!
OMG a pubic humiliation :0 LMAO
Uhh, don’t feel too sorry for poor old Michael! I think right about now he’s laughing all the way to the bank!
Domus “I also have to agree with -A- that you make posts which are completely wrong”
You wish really badly they were wrong but in fact they are correct.
“the one about the subprime mortgage payment being 10 times larger was basically ridiculous, I didn;t even reply. The average increase, according to Mortgage Insider, is between 25% and 35%.”
Sorry 10 times it is. Have a look at the 60 Minutes video as to what is happening in California. No such teaser rates exist in Canada. If they did I would agree we would see the same situation when the rates reset by 10 fold.
it’s about the land!!
Yippee, just got the letter from Scotiabank, mortgage rates down from 5.15% to 4.90%.
Looks like lots more eating out, investments and maybe some more YVR RE ! 🙂
VHB: “Which forecast did I make? I always said that prices will correct.”
No, wrong again in your forecast. They won’t.
“No, wrong again in your forecast. They won’t.”
They always have, despite the difficulty in predicting exactly when they will. In any event I thought the Flat Earth Society had disbanded. Seems they still have at least one charter member.
I think Rob went to California to hang out with his newfound realtor friends down there.
Has anyone else noticed how keen Van City seems to be to get cash these days? I went to my local branch today and got 3.5% on a 30 day cashable term deposit. (This is about 1.0% higher than I expected to get).
They have also introduced a “high interest” savings account that is paying 3.75%. But it has very large fees for any withdrawal type activity ($5 per withdrawal if memory serves me correct).
Is anyone else seeing this at the other banks?
In the last few days, i have heard of a couple of over-list sales. One small rancher in North Van went for about $50,000 over asking, almost a million.
It ain’t over yet. Inventory trends may be interesting but they mean very very little if they aren’t followed by price drops.
Personally, I think the correction may come. I am just not as smugly self-assured as the armchair pundits on this site. Years of wrongly calling the top have learned me.
Craigy, you said: “I am just not as smugly self-assured as the armchair pundits on this site.”
We Bears post our opinions only after much reaseach and thought, hardly being “smugly self-assured” as you suggest.
“Years of wrongly calling the top have learned me.”
As everyone can see, the Bulls on this site, for the most part, have questionable writing skills. It is their hallmark. (We all can be forgiven for misspelled words, fragmented sentences, and for occasional errors in punctuation and syntax, all without sacrificing clarity.)
But a general lack of conformity to the principals of grammar is another thing. Long live the Bears, I say. We will triumph!!!
Someone mentioned to me that they saw this on the news a couple days ago. I have tried to find it on the internet with no success. If you watched this or can find the article related to it, please post.
Some mortgagees in Toronto with zero or little down can’t afford the renewal rates even if they are 1% more.
U.S. Payrolls Decline for First Time in Four Years
The U.S. economy unexpectedly lost 17,000 jobs in January for the first time in more than four years.
A HUGE drop in listings this a.m. due to de-listing at month’s end yesterday.
Should be interesting to see what develops.
Popeye, you can’t even spell research and yet you expect us to believe you have done some ! That’s irony 🙂
Snick – is this IT – the big surge? I checked out Calgary listings, yoy – they are more than double last years #s….is the tide turning?
THAT’s Randallblather? Wowiee. A David Hasselhoff wannabe rice king? Yowza.
Yes. This is the end of it.
January 30, 2008 at 3:41 pm
Somewhat off topic — Does anyone know how things are playing out in the interior? Are there sites with towards numbers, charts or blogs for, say, Kelowna and Kamloops?”
Here is an anecdotal answer for you; I have a friend WBWUCR that listed a 3 bedroom townhouse in Kamloops for $350 last Saturday. There were 6 showings and 2 offers. The second offer was accepted at asking, yesterday. The buyer was from Kelowna as the prices are still “affordable” in Kamloops by comparison. I don’t know of any websites / blogs for the interior as you inquired about.
“The buyer was from Kelowna as the prices are still ‘affordable’ in Kamloops by comparison.”
Logic like this is what happens in Vancouver too. “Prices in the my former city of residence (London, HK, whatever) are higher therefore Vancouver is a steal.” Not faulty logic as long as you know you are speculating.
“A HUGE drop in listings this a.m. due to de-listing at month’s end yesterday.”
I look at Paul B’s site and there was a modest increase, from 9947 to 9997.
I look at Paul B’s site and there was a modest increase, from 9947 to 9997.
Those are yesterdays numbers. Snick is implying there is a huge drop in listings this morning, although I’m not sure what he is talking about. Snick?
“Not faulty logic as long as you know you are speculating”
I agree, I was just pointing out things seem to still move in Kamloops as whybuywhenucanrent had asked a question about it.
Not often you see a 2 bedroom for $94,900 anymore. Mind you, I sure would pass on it.
Somebody goofed. When Fed chairman Ben Bernanke cut interest rates to 3% yesterday, the price of a new mortgage went up. How does that help the flagging housing industry?
About an hour after Bernanke made the announcement that the Fed Funds rate would be cut by 50 basis points the yield on the 30-year Treasury nudged up a tenth of a percent to 4.42%. The same thing happened to the 10 year Treasury which surged from a low of 3.28% to 3.73% in less than a week. That means that mortgageswhich are priced off long-term government bonds—will be going up, too.
Is that what Bernanke had in mind; to stick another dagger into the already-moribund real estate market?
darn K wave
The rate cuts have nothing to do with easing the terms of mortgages. They’re desperately trying to keep the financial system liquid.
“Those are yesterdays numbers. Snick is implying there is a huge drop in listings this morning, although I’m not sure what he is talking about. Snick?”
Maybe I jumped the gun…I checked BOTH a VOW site and the RealtyLink site and both were WAAAAY down.
Sorry I made a complete fool of myself. I had been drinking heavily when I made the idiotic statement that payments would have to go up 1o fold before in order for the market to tank here.
Anybody with a brain would realize this is utter stupidity on my part.
Mind you somebody like Skeptic and Aaron could possibly believe it even if they weren’t in a drunken stupor.
“Sorry I made a complete fool of myself. I had been drinking heavily when I made the idiotic statement that payments would have to go up 1o fold before in order for the market to tank here.
Mind you somebody like Skeptic and Aaron could possibly believe it even if they weren’t in a drunken stupor.”
News Flash, don’t beat yourself up, everybody makes mistakes, I actually thought your post was somewhat of an aberration. Your contribution is usually insightful, probably because of your intellectual prowess and obviously your extensive academic back ground in economics and finance.
Your contribution is usually insightful, probably because of your intellectual prowess and obviously your extensive academic back ground in economics and finance.
Snick – I didn’t say I thought you were wrong, I just didn’t know where you were getting numbers from… We’ll see how she plays out, eh?
Hey Blueskies. was that a funny one or what?
Sometimes I am utterly amazed how Tqn, Newsflash, and the other couple of dogs can get on the net and still have enough synaptic function to post.
Maybe a stupid question but I just found this site and am not sure how the dates/numbers work. the heading reads Jan 31 Wed numbers…
are these Wed numbers? posted on Thurs the 31st? Doesn’t seem to be the way the other entries work.
They aren’t Thursday’s numbers?
And honestly I’m hoping that the same thing happens in Canada with the longterm rates (ie rise instead of drop) should the Bank of Can decide to chase the Americans to the bottom.
NewsFlash – there are people who can help you with your drinking problem
Actuellement, silly moi, I think I typed in a narrower parameter with respect to the price(s).
For REBGV we are at 9881 today down from 9996. That is a minor change for the months end.
You hear it everywhere, repeated like a mantra: “rich immigrants are driving up Vancouver real estate prices.” Are rich immigrants driving up the prices in Saskatoon, Winnepeg, Regina? Are those cities some of the “best place[s] on earth”? Did they love Edmonton so much that they drove up the prices there? Now that Edmonton is dropping the rich immigrants decide Edmonton was’t so “hot” or “safe” or “stable” and move out en mass? Did rich immigrants from across the globe bid the prices up 100% in one year in Punjab, India? Is Punjab, safe and stable enough to attract rich immigrants? WAKE UP! The property bubble is/was GLOBAL and is driven by the biggest credit bubble in history.
Where is the data that proves that the Vancouver market is driven by rich immigrants? I have never seen or heard any hard numbers on foriegn buyers. If anyone has the data to PROVE that rich immigrants drive Vancouver real estate, lets have them. Otherwise, rich immigrants are as much a fiction as iraqi WMDs.
“Where is the data that proves that the Vancouver market is driven by rich immigrants? I have never seen or heard any hard numbers on foriegn buyers.”
There is no data because it’s a big lie.
I have an uncle who builds 3-4 houses every year in Vancouver. I just sold his last house and will build no more because he believes that this is the top of the market. He did the same thing at the top of the last cycle in the 1990’s and did not build for 2 years while the market corrected.
I for one and anticipating with glee the sob stories of foolish buyers on the 6:00 news when RE declines. It is true that I have no sympathy and I admit that this is due to the fact that I’m angry at myself for missing out on the boom due to bearishness.
What have I learned? That the pubic is composed of fools with limited reasoning ability who will believe mere stories and will bid up prices to unsupportable levels and take on back breaking debt because of the myths that they fervently believe in like some new religion. In short, I overestimated the intelligence of the general public. If you want to make money, assume that they are morons and invest accordingly.
I mean, “he” just sold his last house and will build no more. I don’t sell houses…
Interesting anecdote B-o-P. Coincidentally, when I visited the websites of the big developers (Polygon, Bosa, etc) a few years ago, each of them had upwards of half a dozen developments up for (pre-)sale. Out of curiousity, I checked them yesterday and each lists like 1 or 2. Now why aren’t they going gangbusters in this wonderful boom???
Burden of Proof, I hear you……
“Extraordinary Popular Delusions and the Madness of Crowds is a popular history of popular folly by Charles Mackay, first published in 1841. The book chronicles and vilifies its targets in three parts: “National Delusions”, “Peculiar Follies”, and “Philosophical Delusions”.
News Flash, Tqn, and Skeptic, sorry, you will have to go to school before you can understand.
Option ARMs, next chapter in U.S. housing crisis
With an Option ARM, borrowers can make a minimum monthly payment like a credit card, but if they do the principal increases.
“Burden of Proof
February 1, 2008 at 6:32 pm ”
Relax! I get it!
Blueskies, the banks have a similar product here, it’s just not widely advertised.
One of the features of the Canadian version is that if interest rates rise by more than 2% you can make the same payment but less will go toward the principle.
If the payment doesn’t cover the interest, the amount is tacked on to the mortgage.
Yes it’s a debtor’s death sentence.
“Extraordinary Popular Delusions and the Madness of Crowds is a popular history of popular folly by Charles Mackay, first published in 1841…
It’s a nice (not so little) book on herding behavior but I can’t seriously recommend it as a page-turner.
Are you Michael Randellbard?
it’s ok to be envy and angry at the world to make the comments that you have. Thanks to Rob, you have a place here that you can express your frustration. If I could sell your negativities and misery, I could buy another downtown condo 🙂
Why the heck do I need to go to school for? Taking in bunch of debt, no money for rent and grocery, and spending time on the net whining about the world? No thanks.
I like to enjoy everything that Vancouver offers, it’s the best place on earth. Hm hm, life is good.
Inventory is building. I notice stagnation. Some prices dropping $10-$20K.
I need to see CRACk though.
Uh… VHB are you going to start your site back up or you going to keep teasing us with your comments here on Robs blog?
Yes VHB I’m laughing all the way to the bank while you wallow in your ignorance and inflexibility. I think you are just schoolyard jealous. Had you listened to me instead of trashing me for the last couple years you would be very much further ahead financially but not only did you not benefit from my advice, you tried to and continue to try discredit me and by doing this you selfishly prevented board members from taking perfectly good advice which would have helped them keep up with the rising prices of homes here using real money (gold) as a hedge, so go ahead and post pictures, comments or whatever you want to but I am having the last laugh with gold up 37% in 4 months.
Here’s my assessment of your fan club. There are 2 types:
People who look to you as some kind of guru by merits of your being the creator of the board and therefore an expert on everything else so they imagine. These people are losers and always will be. “Don’t follow leaders, watch your parking meters”.
The rest are probably independent thinkers and weigh information, not the looks of handsome messengers or their personal life etc etc. and these are the ones who shrug off shallow people like you who they know would detract them from the biggest prize in life, wisdom, understanding, knowledge and how to benefit themselves and others with it.
Your motive has always been suspect to me in your anonymity. Conversely I have nothing to hide or be ashamed of which is why I don’t mind using my name nor do I feel I need to justify why or why I don’t, just like anyone else. But I posit that you are a fraud and have pulled some hurtful stunts in the past like leaving your worshippers in a lurch for your daily pablum.
somewhere a thesaurus is weeping
Yes, you’ll always have your dignity. And your thesaurus.
ashcans and unobtainable dollars! VHB the heavy judger of men, whose soul is electricity and banks!
This market is done. DONE. Mark my words, soaked in red wine. I drink to victory!!!
40 year is fully priced in. Unless there is some other trick up their sleeve, its over. DONE!!!
why don’t you research the difference between “principles” and “principals” and then you can learn me on the subject of grammar.
i too won’t have much sympathy for those that buy what they can’t afford. by and large, they are all consenting adults and have nobody to blame but themselves for their misfortune. If you want a chance to make money, you have to accept risk of losing money. placing the bulk of the blame on realtors – as many on this site seem to do – largely misses the mark there are, of course, some dishonest realtors but most people buy because they want what is being sold.
all that said, don’t you find it a bit ironic to label those who made money on real estate in the recent boom “morons” when you (presumably not a moron) missed out? if you are as intelligent as you imply, shouldn’t you have realized early on that you were badly misunderstanding the popular (i.e. moronic) sentiment?
o and anyone who feels free to mock randallbard’s photo, should have the guts to post a picture of themselves first. of course, it won’t happen, because the courage of the popinjays on this site is derived almost exclusively from their anonymity.
Just got back from Daytona Florida. 1 bdrm waterfront condo $140,000 X 1000. nice weather, better than Vancouver. How much for 600 sf condo in Yaletown?
Yeah, Vancouver is a great place to invest. The 2010 Olympics you know. Buy RE now, you will double your investment. If you are in now as a specuvestor, you may want to grow corn in your condo. Like I said, “greed & fear” are the only 2 forces that drive markets. BOO!
Oh ya, Daytona Florida is definitely same class as Vancouver. Most livable city in the world my ass, it has nothing over Daytona.
BTW, I can also sell you parcels of land in Saskatchewan for $1 an acre.
Craigy, I stand corrected. Thank you.
Canadian Mill Towns Pay For U.S. Housing Collapse
Coco’s Canadian Mill town link. The fact that it is a Washington Post artical makes it doubly interesting. It’s strange that it does not make a lot of front page news in Vancouver, it’s like this city wants to ignore where it actually gets most of it’s income. Not mentioned is the Provincial Government Royality income will drop proportionally, resulting in budge deficits, no money to pay for the convention center which probably will bring in peanuts compared to the forest industry. Probably better we loose all of Whistlers income then this! Where are those bloggers that constantly yap about what happens down south has nothing to do with the best place on earth!
Good read Coco! Thanks!
Media is too busy with local real estate hype to report that MacKenzie has 70% unemployment, retail sales are off by 50% to 75% and people may lose their homes to foreclosure because of the forestry industry.
I tried posting a link to this article twice, but WordPress is not posting it for some strange reason.
Very interesting read about Alberta’s oil patch
in the Edmonton Journal, here is the headline if you which to google it to read the article:
Pain lurks behind rosy headlines
That should be if you “wish” to read it. Need more coffee.
Bank of Canada keeps injecting 150 million into the market daily. I have not reported this for quite awhile as it would sound like ground hog day over and over again.
Remember 25 million is the norm, so our credit woes are far from over.
Thanks Coco! Also very interesting. Considering a lot of BC’s income comes from natural gas in the Ft St John area, wonder how much our provincial coffers will suffer. If I remember right it was royalities last year on Nat Gas that boosted the BC economy…not real estate! 🙂 Heres your link maybe it will work.
VHB, I followed your blog with great interest for a long time. You always had class. But what on earth did you hope to accomplish by your “outing” of Randallbard? IMHO, it was mean-spirited and (I would have thought before now) out of character.
Thanks for posting the link.
VHB should post their own photo, so we can all see who is actually talking about Michael Randallbard.
it was mean-spirited
no it is part and parcel of the ongoing 9-11 conspiracy….. watch your back
and bury your gold!
Condominiums are clearly a viable – and now financially feasible – alternative to single-detached housing
The price of gold has risen 239 percent since 2001.
If we enter into a stagflation gold is a good investment.
Some people think the price of gold falls during a recession, that is only true 50% of the time.
Comment above about gold is me.
so 50% chance of losing money on your investment?!
I think you guys are all a bunch of RE idiots…
I don’t think we will have the same meltdown as in the USA.
Because according to News Flash, payments would have to go up 10 fold.
But should that happen, there is plan B:
Aaron Best will phone the premier and ask the government to raise everybody’s wages, and this will eliminate the affordability impediment.
To be fair, Aaron posted the theory sometime ago, and I can’t remember the details.
But I do remember it was as complex and hard to understand as Rob’s theory on how cash flow negative was a good thing.
when in doubt…flail
people will think you are deep and profound….
If Vancouver buyers have been paying 10 or 11 multiples of household income for a shoe box or a crack house in your neighbourhood, according to your theory do prices have to go up to 100 or 110 multiples of household income before affordability becomes a problem?
Aaron, would you then phone Gordon?
Fitch Concerned about Borrowers ‘Walking Away’
Via Housing Wire: Fitch Places $139 Billion of Subprime RMBS on Negative Watch, Cites ‘Walk Aways’
It’s worth noting some of the language in Fitch’s press statement — because it’s the first time any of the rating agencies have lended credence to the idea that borrowers are walking away from their homes [emphasis added]:
In Fitch’s opinion the contraction in the mortgage markets has contributed to an acceleration and deepening of home price declines, and has eliminated the option to sell or refinance a home to avoid foreclosure for many borrowers. Additionally, the apparent willingness of borrowers to ‘walk away’ from mortgage debt has contributed to extraordinarily high levels of early default, which is particularly noticeable in the 2007 vintage mortgages. As Fitch has described in recent research reports, this behavior appears to be largely attributable to the use of high risk mortgage products such as ‘piggy-back’ second liens and stated-income documentation programs, which in many instances were poorly underwritten and susceptible to borrower/broker fraud.
A combination of falling prices (with millions of homeowners upside down on their homes), and changing social norms, could lead to staggering losses for lenders and investors.
Things are very good for real estate in Vancouver
1.have a very good and strong econmy in Vancouver and in BC
2. if lumber industry collapses that is ok because we grow more marijuana
3.We have no problems with real estate prices and they certainly will go alot higher because
4.many people like to move here and bring their US dollar
5,CMHC lend mortage money only to peolpe who read and write….not like in US where they giving mortgages to most
5.Vancouver apprasers do a good job and they have no reason to make price higher than should be
6.Olypympic debt should not be more than 2 billion dollars
7.not have job loss….we need more construction workers to build more buildings because more people move here because Vancouver truly is probably best place to live in south west BC
8.Credit Top theory is false because they still take my credit card
9. Banks will lend you money because Vancouver
10) Vancouver is the best place on earth. Politicians say so.
“Vancouver truly is probably best place to live in south west BC”
I have truly seen it all! (Note the smiling people admist the packing boxes?) UNBELIEVEABLE!
I don’t think that VHB is actually posting verse Randallbard.
Imposter is amongst us.
Soon opening many brances in Victoria, Vancouver and Kelowna.
Are you stressed out about your mortgage payments?
Do you have little or no equity in your home?
Have you had trouble trying to sell your house?
Is your home sinking under the waves of the real estate crash?
What if you could live payment free for up to 8 months or more and walk away without owing a penny?
Friendly service, multi lingual
Tqn, News Flash, Skeptic, just to show what a nice guy I am, I am inviting you to send your Resume.
“BTW, I can also sell you parcels of land in Saskatchewan for $1 an acre.”
I’ll take 100,000 acres, please. Seriously.
Snick – think we see some negative headlines in the local press when Jan #s come out? Or too early yet?
On Pauls Blog – 14% increase in listings YOY, 2% increase in sales YOY, maybe some crack?
News from the UK
UK: The Return of Negative Equity
From the Daily Mail: The return of negative equity:
Thousands Credit ratings agency Experian have drawn up a map showing which areas of the country are most at risk from a fall in prices.
It found that in some parts of Britain, the average mortgage debt is more than 90 per cent of local property prices.
This leaves owners vulnerable to negative equity …
The financial regulator, the Financial Services Authority, has warned tmore than a million families are in danger of losing their homes in the next 18 months.
Negative equity limits mobility, prevents homeowners from selling, refinancing, or borrowing from their homes in case of an emergency. So it shouldn’t be a surprise that negative equity is also highly correlated with foreclosures.
Also in the UK, the WSJ reports: Citigroup Cuts Off Some U.K. Credit Cards
In a sign of more consumers losing access to loans, Citigroup Inc. has told some 161,000 credit-card customers in the U.K. that they can use their cards until the first week of March and then they’ll no longer be able to tap the New York bank for credit.
I am proud to say that we Canadian have been much more responsible than our American or British cousins: never have we taken 90% mortgages over here, never have people borrowed heavily on credit cards. Canada is different !
never have people borrowed heavily on credit cards. Canada is different !
we are probably bigger credit whores than our Am/Brit cousins……
February 2, 2008 at 5:19 pm
Snick – think we see some negative headlines in the local press when Jan #s come out? Or too early yet?”
With Global TV and Friends, the NEWS will be VERY OLD when they get around to reporting it.
Even Bill Good and the Gang over at CTV will continue to report on “Vancouver’s Hot RE Market” for some time to come.
On a happy note, though, their reportage is all very similar to the Time Magazine cover stories.
And, we know what happens then…
Snick – too true. Snick, I may disagree with you, the trend/numbers over the next short while may be enough to get this on the front of the news – nothing sells like bad news. We’ll see – but I do think this spring the cracks may be wide and frequent, thereby making even the most obtuse observer wake up and take a closer look.
Strataman – thanks for the yoy numbers, interesting….still, we need to see a wider divergence than this to see if the trend is strong enough to trump psychology – would you mind updating this from time to time?
I don’t think we will see much “bad news” in the media until YOY goes negative. A poor spring sales season plus negative YOY could lead to bad news headlines in the summer.
On the other hand, thinking cynically, maybe the newspapers will wait much longer since they don’t want to displease their advertisers.
Vancouver, the best place to purchase RE. Whach your investment grow and retire a multi millionair.
Although I knew it was coming (as many others), I never wanted to see it. Well, it’s here now, and better get over with it sooner than later. Phew!
Hope this time people do learn something from it, yet so far I am bearish about that, too.
-A- Credit Repair,
my resume, it’s a short one but do you know how to read? 🙂
Off to Stanley park for a long walk, then go for dim sum – Vancouver, the best place on earth!
good find on the credit article!
i think this is just starting, next up are car loans/leases….
One needs the “best crack on earth” to call this place the “best place on earth” under current conditions.
Once the pipe dream effects wear off, and the reality sets in, many will have time for some really long walks, then go have some “whatever” at the “Soup Kitchen”.
Phew! I’ve already lost my appetite for today.
This is to acknowledge receipt of your resume, your previous training in toiletbrushology and your completion of the advanced security guard training is a definite asset.
To enhance your chances at securing a position with us ,may I suggest you enroll in –A-‘s School of Business.
For only $10,000.00 non refundable fee, you can get your diploma in Bad Debt Collections, which is a prestigious diploma recognized anywhere in the entire Metro Vancouver Area.
Many of our graduates move on to more advanced accreditations such as Jurock’s intense 1 day Real Estate course.
Seems to me that inventory is increasing at a rate of about 100/day. At this rate we should be at about 12,000 by the start of March, which is when things will start to get really interesting…
Sales will pick up so I doubt inventory will keep increasing like this. I predict a bear year though.
buy a car instead of RE!
how bears really travel
That should be if you “wish” to read it. Need more coffee.
Forget coffee, try these
I just bought a pack of their Foosh Energy Mints last week at 7 Eleven and they pack quite a punch.
The driving force behind the RE downfall will be HELOC’s…. Using your false equity to purchase Hummers and swimming pools. The overspending of simple minded individuals is astounding. This foolish overextending of ones credit will truly be the one sure way to ruin….
By the time Vancouver starts to crash, the banks will be moving quickly to cut HELOCS for depreciating properties. Because we will come late to the crash, it will be all the more sudden and severe. I think it will happen so quickly that the media will be caught offguard and miss the story. They will just report the after-affects…crying and moaning.
What about Thurs and Fri numbers?
Are the buy/sell figures for all residential properties in Vancouver proper – meaning including all houses and condos? If so, is it worth looking at the two independently to identify trends? I ask because a realtor friend of mine was saying the majority of new properties for sale these days are condos and that houses on the west side of Vancouver are still very hard to find and sell quickly. He also said single family house prices are up around 5% over the past 4 months on the west side.
Goinggoinggone: PaulB’s site has some good detailed stats for the GVREB.
(I don’t know if it’s kosher to advertise another realtor’s site on this realtor’s site– Rob/Aaron/Chan can delete this link if they like)
Went by a couple of home opens today, lots of traffic and a couple of fresh ‘sold’ signs in my neighbourhood.
Will be very interesting to see how the spring shakes out. February/March really seems to be the litmus test for where prices are trending.
Well in light of new evidence……
I guess the bulls will be happy to know the housing recession is over in California; Sales have picked up dramatically, and prices are heading up again.
Looks like we can expect the same up here , since this is The California of the North.
If the market goes up one more year this is the longest RE expansion in the history of the lower mainland, and also the largest by price. One more reason to be wary to enter the market at this point. The longest the expansion, the larger the correction.
I almost hope for one more up year……..the explosion will be louder.
“I ask because a realtor friend of mine was saying the majority of new properties for sale these days are condos and that houses on the west side of Vancouver are still very hard to find and sell quickly.”
A realtor who is a friend or a friend who is a realtor?
Just look up the house listings for Vancouver West. There’s product out there to buy if you’re willing to pay the asking price.
Coventree says it will likely wind up operations
CMHC – Housing starts to fall slightly in 2008
Ryanair is the Westjet or Jet Blue of Europe….
(Airlines and air courier companies are a good indicator of what is starting to happen in the economy as traveling and shipping costs are the first thing companies and/or consumers cut back on)
Irish airline Ryanair Holdings PLC warned that its profits could fall by up to 50% next fiscal year due to high fuel costs and pressure on ticket prices from waning consumer demand.
Europe’s largest budget airline posted a slightly lower profit for its third quarter ended Dec. 31 and a weaker load factor for January.
Ozzie Jurock is currently selling a course charging $797.00 on how to get into the market and make some money. Does anybody know where I can spend $797.00 on a course on how to get OUT of the market and SAVE some money?
I was just teasing, the situation is getting worse by th minute dowen south.
February 3, 2008 at 10:15 pm
Well in light of new evidence……
I guess the bulls will be happy to know the housing recession is over in California; Sales have picked up dramatically, and prices are heading up again.”
Bubble bursts in Elk Grove
City may become yardstick for measuring region’s recession
“A lot of people in Elk Grove are in over their heads with financial obligations,” said John Wallace, a strip-mall developer with several properties in the city. “They aren’t spending like they used to.”
The downturn calls into question just how strong the boom really was.”
You have quite a creative mind, thank you for the good laugh. You should find some good use for it.
Your school training is quite advanced for me, so I will pass on your offer. By the way, I drop by your website and read your biography, your master degree in toiletlickology is quite impressive.
Have we got the stat for Jan yet, anyone?
“fresh ’sold’ signs in my neighbourhood.”
I noticed the same thing, with higher price of course.
If the projected figures for RyanAir rattles you, check out the observed figures for the Baltic Dry Index which tracks bids on global shipping:
Capacity constraints on shipping are nowhere near being hit, meaning a big slowdown in global trade is in the cards.
RyanAir doesn’t rattle me, but I do like watching the airline industry in general as it is economically sensitive.
Interesting graph though. Thanks
The new $3.1 trillion U.S. budget revealed today. The highest spending since WWII.
(Bush did take into consideration that the deficit would rise due to the U.S. economic slowdown)
“I noticed the same thing, with higher price of course.”
‘During upturns in real estate cycles, optimistic psychology takes a hold of the market and this induces more and more people to adopt optimistic beliefs and expectations. People start to believe that what is happening now will continue to happen, and thus they come to see less risk than actually exists in the market. As a consequence, people eventually become excessively optimistic about the future, which causes them to pay too much money and incur too much debt for real estate, and take bigger risks than they should be taking.’
For trends that started out excessively optimistic and then turned negative, one just has to look at the U.S. housing market, but negativity will never happen here, we are different.
Ok, I am late to this post but I just had to comment on that Randballard post. That is just sad. I doubt his intentions are pure. Money can’t buy you everything and will not make you happy. A lesson lost on most of the folks reading this blog.
Hey Rob, strike up the band..it is kumbaya time once again!
Fed Says U.S. Banks Are Tightening Lending Standards (Update1)
By Scott Lanman
Feb. 4 (Bloomberg) — More banks made it tougher for companies and households to get loans in the past three months, particularly in real estate, while a majority said demand weakened for home mortgages, a Federal Reserve survey showed.
Most banks expect more delinquencies and losses this year, assuming “economic activity progresses in line with consensus forecasts,” according to January’s quarterly survey of senior loan officers. About 80 percent of U.S. banks raised standards on commercial-property loans, a record since the survey first asked the question in 1990, the Fed said.
Craigy said he thinks a correction is coming; he just doesn’t know when. Is that all it takes to earn the bull label these days? 🙂
Nice to see that you’re still in good health and posting. I had to delete that post with the pic. If its not accurate its bad karma, and if it is accurate, well I think its still bad karma…thanks though! 🙂
“The longest the expansion, the larger the correction”. The average price graph from the Board doesn’t seem to support that theory, but that, of course, is just local.
Rob, we have had this conversation before. I invite you to look at the Sauder graphs on real (and nominal) house prives in vancouver for the past 25 years. You will see what I mean: this is huge and I would cash now if I was a owner/investor. There is no way you will get this trenbd going much longer (meaning more years, rather than months).
Who said immigration is still strong? Here are some recent data from the latest Census!
Back-to-back declines in newcomers to Vancouver CMA
The number of recent immigrants who chose to settle in the census metropolitan area (CMA) of Vancouver has declined for two consecutive censuses.
Between 2001 and 2006, an estimated number of 151,700 newcomers, or 13.7% of all new arrivals in Canada, chose to live in the Vancouver metropolitan area.
This was a decrease from the 169,600 individuals who arrived in Vancouver between 1996 and 2001 and well below the 189,700 who arrived during the early part of the 1990s.
Vancouver was the only metropolitan area of the three largest that experienced a decline in new arrivals during the past five years. Both Toronto and Montréal recorded increases.
The main factor in the back-to-back intercensal decline was a slowdown in immigration arriving in Vancouver from the Hong Kong Special Administrative Region, which has been the source of many newcomers in the late 1980s and early 1990s.
As China develops and Hong Kong booms, more and more asian people will choose to stay home and prosper there. Just like Europe stopped sending people over here, so will China in the near future. Anyone bearish RE ?
This is it prices have finally fallen off the cliff! Trout lake SFH for $1. What is the YOY decline on that!
In case the link doesn’t work: MLS #V686341
It’s so easy to say. I would sell all gold bullions if I was the investors cuz it’s also bubble…Problem is, I got nothing to sell! and I got nothing to lose if it’s not bubble. Words are cheap!
do you know why so many people lose money with bubbles? It is called greed: they are reluctant to cash in and leave the market with the winnings. It is human nature and it will happen again soon……you are clearly an example.
You consider yourself cautious: you wait and see if you can make some more by delaying the exit. Until it hits you in the eyes.
Investors and speculators aside, would you thinks the homeowners will be selling their houses and sending their families to rental places just because they read what you posted here. I am not an example for you to use; because I dont care whether there would be a crash or a continued run up. I see the market as is.
Given what you said, Have you put you own place on the market for sale already, IF you have a place to call you own? and how many of your friends and relatives have you advised?
tqn, the way I see it, if you’d put investors and speculators aside, there would be no bubble and this blog would not exist…
I do what I think is best for myself, but I keep it to myself. I am sure people are not that interested in my personal situation, but for what is worth most of my money is not in RE (especially Vancouver RE!) at the moment.
As for speculators and flippers: if you take them out of the picture, the question is whether there is enough original demand to support the market over here.
In the US, as soon as speculators left, the market turned big time. Maybe we have stronger demand or undersupply: hard to believe if you look at immigration for the past 5 years and/or the amount of building going on.
Yes, I will keep my money in places other than Van RE for the the foreseable future. If you ask me, it is safer.
This is it prices have finally fallen off the cliff! Trout lake SFH for $1. What is the YOY decline on that!
LOL! Multiple offers and it sells for $1.20
Thanks. I’m not sure I still follow you. I think that you’re saying the longer the expansionary period, the longer the period of correction that follows. Is that accurate? If so, I know it looks obvious to you, but it doesn’t look so obvious to me. What am I missing? At what point do you say a correction begins and ends?
I have, however, added a link to the graphs you’ve cited – should have done so long ago. They’re a good source of graphic information. (Thank you, Royal LePage, for collecting years and years of data and sharing it with Sauder).
Seller says, “$1 for sure! Oh, BTW you have to assume my mortgage as well.”
Or maybe it’s an error, or a good ol’ bait and switch.
I believe the smart investor money is out…. And at a huge profit. I just don’t believe there is any where for the market to go but down. Even the RE professionals predict only single digit increases. The market is changing even as we speak. You can tell when someone has all there money tied up in RE as they are very aggressive when talking about the market correcting… Its sad really. Tqn- He sounds like someone who has a lot tied up in RE maybe a HELOC… Possibly teetering on bancruptcy if things go sour…
Hey….that $1 listing is Snick’s house. Going to 50 cents by year end.
“Thanks. I’m not sure I still follow you. I think that you’re saying the longer the expansionary period, the longer the period of correction that follows. Is that accurate? If so, I know it looks obvious to you, but it doesn’t look so obvious to me. What am I missing? At what point do you say a correction begins and ends?”
Rob, nothing new under the sun: I repeat what I have been saying for the past 18 months. The housing cycle has been long on the way up, it will probably be long on the way down. If I could short RE in Vancouver I would certainly do it: any suggestions on how?
The timing, as always, is anybody’s guess. I don’t know it, you don;t know it. As price growth slows down, may short term profiteers will think twice before moving in. Then it is up to real demand and real supply: will they substain growth? I think not, and I think the market will tank, like in the past 25 years has inevitably happened after long runs up.
Thanks for the link to Sauder…….
What a local financial advisor is recommending:
“For those of you who are contemplating selling your investment grade real estate holdings, this may be an opportune time, as the real estate market is still extremely buoyant in the Greater Vancouver area and the spill over from the United States has not quite hit us yet, but it surely will.”
Larry Jacobson is a Senior Partner in the venerable financial planning/investment counselling firm of Macdonald, Shymko and Company. He has been giving advice in the area of investment management and portfolio design for 33 years. He can be reached at 604-687-7966.
February 4, 2008 at 3:31 pm
If it’s an error, the listing agent should have noticed and have it fixed by now!
If it’s bait and switch, the MLS should put an end to this nonsense.
Of course, if it’s real, then it’s a sign we have negative equity properties in Vancouver. But it can’t be; Vancouver’s different.
Rob, I doubt that was VHB posting.
I don’t think he’d stoop that low as to post Randallbards cross gender photo link.
May the real VHB please stand up?
No, I am Spartacus!!!
Mind you that picture uesd for Randalbard reminds me of that porn director for VIVID :P!
Rob sisnce interest rates are dropping does that mean that the market is starting to heat up?
Can you tell us what you see right now?
Over at Mohican there is a beautiful graph relating price changes to months of inventory: according to this graph, the Fraser Valley is already in flat YOY appreciation nominally (dropping in real terms).
Check it out:
Fraser Valley January Stats out
So much for MOM price increases
Only variable mortgage rates have dropped. Longer term mortgage rates really have not changed that much over the last few months.
Mortgage rates are updated every week here:
An interesting article from the NY times:
” “For those sellers who’ve decided to wait until spring to get what they think their house is worth, the spring they’re waiting for is a very long time off,” Mr. Otteau said. “Unless you have the ability to wait this out for five years, waiting is a losing game.”
Mr. Hughes of Rutgers relies on a different set of numbers than Mr. Otteau cites, but both concluded that house prices in the region would drop by at least 15 percent in the current correction, despite the recent decline in interest rates.
Although the local job market has not been battered by widespread layoffs as it was in the early 1990s, Mr. Hughes said he believed the housing market would suffer more this time because of the reckless lending practices that allowed so many people to buy homes with little or no money down.
“I think the excesses of the subprime lending and extraordinarily low interest rates, as well as all those other exotic loans, really helped inflate the bubble,” Mr. Hughes said. “The correction from that and the fallout from the credit meltdown globally probably portends a more severe correction.”
Of course, Vancouver would never see any such thing: cities like NY and London were clearly overpriced…..and they did not get as much immigration!
re: the $1 Eastside house
appraised at $611,000
standard lot size
Thanks. I’m not sure I still follow you. I think that you’re saying the longer the expansionary period, the longer the period of correction that follows.”
Rob, I thinks he MEANS that the local RE market is like an “overblown balloon” so to speak. The more air that is forced into it, the LOUDER the pop will sound when it does indeed go “Pop!”
Now, in the case of a RE agent who doesn’t subsrcribe to the “bubble theory”, it is sort of like…the more blustery he/she becomes in denying there IS a bubble, the stupider they will look when it has finished running its course.
Mortgage money comes from 2 distinct sides of the vault, which is why what coco told you is true.
I’ve been pretty consistent in saying mortgages are cheap now, and rates really haven’t moved much either way. So no, I don’t see lower interest rates heating up the market. We’re still selling, and still getting offers, and the phone is still ringing.
Mind you, you didn’t ask about mortgage rates specifically anyway, did you? So, are cheaper rates in the economy in general heating things up? Again, I don’t see it, but CB rate cuts are said to take effect slowly (often after the recesion has cured itself, leading only to more inflation). Anyway, no fallout from that yet.
“I repeat what I have been saying for the past 18 months. The housing cycle has been long on the way up, it will probably be long on the way down”.
OK. If you use “probably” then I’m with you. But when you say “the longer it goes up the longer it goes down” followed by “look at the Sauder graphs [and you] will see what I mean” it sounds a littlemore like an immutable law and a little less like an educated guess. In fact, its arguable, based on both of Sauder’s graphs, to say that the length of the run up ahs no bearing on the length of the correction. You point to a similar thing in the New York Times article- an 8 year run upof 145% followed by a 4 year drop of 9%, and another 6-8 years to recover the peak. Did the correction end after 4 years and a 9% drop? Or was it after 14 years and in real terms? Makes it tough to figure out the cycles, and makes it even tougher to treat them like laws. Throw in inflation and it makes it even tougher. There’s too many things in the mix.
One thing for certain: an 18% drop (your NYT article “fears” that much) won’t solve the problems that many buyers face.
However, 145% up (1980-88), 9% down, (recover the 9% by ’98), 135% up (1998-2006), sounds pretty damn good to me. Do the math. Buy and hold. Factor in the leverage. What’s the return? Even better, buy in 1980, extract your downpayment in 1985, and the rest is found money, right? The $100,000 house you bought in 1980 is worth, in 2006, what? Somewhere north of $500,000? (And you got your original capital out early, btw).
This could be the very best time to buy or sell.
Disbelief said ” Tqn- He sounds like someone who has a lot tied up in RE”
I wish, truly.
“maybe a HELOC…”
the answer is no beside a Visa and a MC for convenience.
Thank you for your concern. Hope that sastified your curiousity.
Rob, as for renters…..I don’t think good renter are easy to come by these days because the affordability bar has been lowered so low that the left over people that couldn’t buy have poor credit and so on.
Rob, hows your consistancy with timely paying tenants?
Does my thought make sence that theres more dead beat renters out there now more than ever?
Domus, I’m genuinely curious about your investment strategy, which you appear to imply is doing just fine at the moment. Care to share details (in general terms, nothing private) ?
If you’re investing in the stock market, I don’t see how you can be managing risk any better than people investing in RE. There’s lots of volatility in the markets at the moment (and bubbles in some markets). Ditto for commodities/currencies, etc.
The only low risk investments people seem to mention here are GIC’s which do what – about 4% and change ?
Have you read reports elsewhere about the ‘true’ rate of inflation, which some speculate is between 10-15% in North America ? Obviously governments manipulate the data to achieve their stated goals of 2% but we all see price increases.
How does a 4% GIC create a ‘real’ return if inflation is 10% ?
Am I on the wrong track here, have you got some hitherto unmentioned investment vehicle with low/no risk and high returns ?
We have added two excellent renters to the stock by selling at the (peak?). We think/hope. BTW our new landlords (we knew them before we sold) keep talking about selling. They hate the thought of moving,but also see this as a market peak, with far more downside risk than upside opportunity. Renting certainly does suck in that sense! We may yet post here looking for a place. Good renters are hard to find, and have some bargaining power.
Numbers please. Pretty please.
the world invest and speculate in everything. What is fun without them investors and speculators? We cant blame them for making money and we dont.
You dont invest in RE, so you invested $4,000 on a scooter and speculated that it saved you gas. How is that working out?
There has been some talk here about what real rents are. We pay 900 + ~ 100 util. for 900 ft. newish bright comfy ground level in nice Bby neighborhood. Does that sound right? Great tenants are as golden to landlords as great landlords are to tenants. Crappy ones deserve crappy ones. Either direction.
February 4, 2008 at 7:53 pm
Rob, as for renters…..I don’t think good renter are easy to come by these days because the affordability bar has been lowered so low that the left over people that couldn’t buy have poor credit and so on.
Your so full of it ! Lots of us prefer to rent dumbnuts, and as for my landlords they think we are wonder full. Begged for us to renew our lease (which we did). In fact the one thing they mentioned when they came over is that they wish they could keep the place they own!!! half as good as we do. They are kinda dirty my wife doesn’t like visiting for long.
Ymatter numbers – thanks – what I take from the data (data mining?!:)) is that sales are slightly down and NEW listings a quite a bit UP – if this trend continues…IF IF IF – but I find this telling. Yes I do.
Gosh. If there are no numbers soon, I’ll have to post a picture of Randallbaboon topless in his IROC.
Forewarned is forearmed.
I’m in Van to move out of my property, closes in early March.
I have a couple very good tenants I’d give I high recommendation to. If you have a house or condo and need folks, drop me a line (whybuywhenucanrent[at]yahoo[dot]ca). Mostly UBC grad students, 20s and 30s, some singles some couples. They’ll need a place for April 1.
Two weeks ago when I accepted an offer on my house, I predicted that I had sold at the top of the market. I suspect I was wrong, wouldn’t be surprised to see the Vancouver West Side bump up another 10% this year for good houses or good building lots. Oh well.
Remember, Buy Low and Sell High.
When I bought in 1999 there were good houses on 50′ lots in Point Grey selling for $500K + change, $399K for a lot-value house. They’d sit on the market for months and months without any serious offers.
Buy Low and Sell High.
breaks my heart to hear someone would sell their property, and in Vancouver West of all places.
No, for RE the mantra is not “Buy Low and Sell High”. But rather:
“Buy and never sell, Never!”. Until, of course, you can see you are on the home stretch to the grave.
re-read the NY times article. Look at the graph and ADD inflation.
Ah, remember that inflation (CPI) was above 5% in many years of the 90s. After you have done the sums, come back and let me know.
RE investments return a real long-term interest of just below 3 % (in the most optimistic view). If you don;t believe me (but we had this conversation before) just check professor Shiller’s data.
….Skeptic, just read your post. I don’t want to discuss my personal financial details. In general, there are plenty of things on the stock market which did not lose at all in the past 6 months and are likely to perform even better in the foreseeable future.
Have a look at food and agriculture stocks’ performance since last August (the credit crisis start)…..it beat RE by a factor of 2 and is much more liquid.
I am a bad market timer, but I am not too bad at spotting long term opportunities (at least until now…cross fingers). RE in Vancouver is close to suicidal right now.
thanks for the reply.
Just seen this on BNN, lowest since 911. Not looking good down south. I feel a cold coming on??
January U.S. retail sales flat too.
I think your assuming people on the blog only invest in GIC’s. Stock market returns have been more lucrative than Vancouver real estate returns, it really depends on your investment knowledge, when you sell and locking in your profits.
I would assume many who have GIC’s have made healthy returns on the stock market and locked in profits, that does not mean they had their money invested in a GIC’s the entire time period the real estate market was rising.
Also some may have sold their homes more recently and put the money in a GIC. They have already locked in profits. Unless the economy keeps ticking along full throttle and house prices keep rising above a GIC return, that would be their only downside.
CIBC World Markets warned that more mortgage-related writedowns in a slowing U.S. economy will likely send stock markets down further.
“The tandem of falling (U.S.) housing prices and rising default rates should trigger as much as another US$30 billion to $50 billion in asset writedowns by North American banks over the next quarter, which, together with a visibly struggling U.S. economy could be a catalyst for another five per cent correction,” said chief strategist Jeff Rubin.
Numbers!! We want numbers! Enough opinions, where’s the numbers?
Ding! Ding! Ding! Stock market’s off to a great start this morning!
Tqn, if you’re not invested in real estate, looking to purchase real estate, employed as a realtor or married to one, then why on earth are you wasting your time in a forum like this?
February 4, 2008 at 11:23 pm
“Buy and never sell, Never!”. Until, of course, you can see you are on the home stretch to the grave.
Why not cash out and enjoy life (well before the home stretch)?
Don’t drink the cool-aid, don’t take the happy pills and hope for a miracle. The States IS entering a nasty recession, Canada WILL follow, excesses of the past few years WILL correct, overleveraged businesses and individuals WILL pay the price. Vancouver R.E. sure looks like a local bubble ready to pop, superimposed on a massive worldwide credit bubble. Look, up there in the sky! It’s a giant needle!
But alex, I saw on the National last night that Canada had effectively decoupled from the US.
At least, this is what second-year geology students in Alberta thought…”the commodities boom is going to continue for another 20 years at least”.
Good luck with that – I can see why you are in geology and not finance.
BTW alex is me, just one of me.
jan 08 benchmark sfh $742490
dec 07 $730399
jan 07 $641596
exactly! Cash it now…..
prediction: (bear warning)
Feb/08 – Mar/08 Metro Van housing prices down MoM.
the first of 120 consecutive monthly drops…..
until April 2018….
ala Riverside Cali….29 consecutive months price drop and no end in sight….. 🙂
on an up note:
Investors with experience with residential-mortgage assets have been buyers, paying in the “mid-teens to low 30” cents on the dollar for the senior-most, or super-senior, classes of CDOs comprised of low-rated asset-backed bonds,
hmm could the actual assets be worth the same?
You’re faced with two options: sell and cash out, or hold, mortgage for what the proeprty will carry, and retain the title. Both have pros and cons, and once again, I think it boils down to risk tolerance and personal preference.
Buy a place 10 years ago for $100,000. Now its worth $200,000. Say you out 25% down. After 10 years you’ve got about $20,000 mortgage paid off by your tenants, so your equity is the original $25,000, the $20,000 paydown, and the $100,000 increase in value. Sell, pay off the mortgage and you’ve got $120,000 taxable and the original $25,000, right?
If you’ve raised rents during the 10 years you already have free cash flow. If you need cash you can mortgage the property more. How much is determined by you. You can go as high as rent covers, or incur a negative cash flow to offset income tax (to varying degrees, deending how you hold the properties). You won’t end up with the same $120,000 in your hand. Much of that will stay in the property. But, you likely won’t have a capital gains tax bill, and you’ll retain the property.
Bottom line: there are two ways to withdraw equity from investment property – sale and mortgage. Personally, I side with the “don’t let go of the property” group. However, as I said to WBWYCR, you can’t lose selling at a profit. All that happens is that you need to go find a new opportunity (unless you’re at the end of the wealth building cycle); even if WBWYCR feels he’s sold too early, he’s still ok.
“Stock market returns have been more lucrative than Vancouver real estate returns, it really depends on your investment knowledge”
Which stock markets? Which returns? And how do you calculate them? A lot of properties purchased on a break even basis in the Lower Mainland over the past 4 years are probably giving triple digit returns.
If you say that ceertain stocks have returned very well, then sure, I agree. I’ve had some big winners (but also some losers). But if you go that way you need to include the leverage side of real estate, I think.
I project returns based on an assumed annual appreciation rate of 5% nominal. You can prove that its only been 3% real all you want – I won’t and haven’t argued. The point is that at 50% mortgaged you’d be getting 6% real terms. That’s pretty conservative investing and a pretty good return. It doesn’t take into account tax advantages or free cash flow, and it doesn’t take into account asset inflation or profit taking (which are far from uncommon).
Lots of good renters out there. I find 10 or so every month. In slow markets I need to find more like 15. I’m not having trouble renting unless a) I push too hard, b) the property is inferior c) the property is in a brand ne dvelopment (lots of “micro-supply”/competition) or a combination of the first two.
Shelter is a necessity for both good and bad tenants in up or down markets. (And btw, for all the bad press tenants get, remember: unless we moved from mum’s basement into our first purchased property, we all rented at some time). In my experience the vast majority of tenants are good.
> February 4, 2008 at 11:23 pm
> breaks my heart to hear someone would sell
> their property, and in Vancouver West of all places.
> No, for RE the mantra is not “Buy Low and Sell
> High”. But rather:
I’m selling largely for personal reasons, not market-peak issues.
But part of it is that I don’t plan to return to Vancouver for at least 5 years, and I figure a serious bear market will be back in force by 2013, and I can pick up a place like this for less than I’m selling today. Combine that with the carrying costs of expenses over rent, and the hassle of 5 yrs of property maintenance, and you have me pulling up stakes.
Again, great tenants up for grabs. Need someone to fill that condo you’re holding for a year then flipping? That house you’re holding ’til The Grave? Drop me a line at whybuywhenucanrent/yahoo/ca
Hi Rob — any reason why you are “holding back” lstings/sales info for the past few days…? Understand if it is time contraints….we appreciate what you provide for us, just wanted to let you know we are waiting to be updated! 😉
what i’m hearing from you is the smart money getting out…… good on ya!
I really don’t understand how you could have big losers in a stock market that was in a bull run for so long. Either your broker is making bad recommendations or your not doing your homework on what your investing in.
As a realtor you can pick a house that will appreciate faster and sell quicker, and investors do similar only with stocks.
watching the market:
Not holding them back, really (that would require a desire on my part, I think); I’m just really busy.
Here’s one problem: I didn’t say I had big losers. I said I’ve had big winners, and some losers as well. That means not every stock has appreciated. That’s not a news flash.
Additionally, some stocks are speculative. The might return huge amounts, or they might be de-listed. (That’s a huge, and under-recognized dif between stocks and real estate, btw).
CIBC closed at 71.64 yesterday. 52 week high was 107.45. Its been as low as $59.90. That’s a 44% drop. CPR was as low as 57.30, from a 52 week high of 91.00. Cameco is close to a 52 week low, down 45%. I’m not saying everything is down, but plenty is. Were we not getting panicked calls from our brokers just two weeks ago? Did not someone post here (twice) “This is not a drill?”
The idea that you can pick a house that will appreciate faster and sell quicker the same way you can with a stock is simply not true. According to my broker, the majority of stocks on the TSE declined in value last year. A minority increased, yet the index went up. The relation is reversed for real estate.
I am curious how the economic slowdown will affect our markets. So far we have been very resilient to any negative news coming out of the US. We had another market bust today after more economic news pointing towards recession in the US. Are we going to have drop after drop like this as the negative news pours in? I though the consensus was the US is in recession?
exactly! Cash it now…..”
-A- might have you qualified for his financial training school 🙂
As domus pointed out with the NYT article yesterday, there is no longer a consensus that the US is going into recession. Lo and behold, this morning Michael Campbell made use of the same subject matter.
When you say “market bust” I’m guessing that you’re talking about the stock market, right? Both the Dow and TSX are down today.
Petrobank went up 2500% in three years. Ooops and only I said triple digit returns. Less work than flipping houses, better profits.
Rim, Apple, Potash Corp. to name a few.
“According to my broker, the majority of stocks on the TSE declined in value last year.”
No, it actually was split. Sounds like your broker is covering their bad recommendations by saying the majority of stocks declined.
*note, I do not recommend buying the above stocks in current market conditions.
Even I said “got cash” last year.
“Ooops and only I said triple digit returns. Less work than flipping houses, better profits.”
First, I said I had some big wins.
Second, I never said all real estate is a better investment that some stocks. That would be foolish. In fact, I’ve never said real estate is better than the stock market. I’ve simply said that bought wisely, and held long term, its an excellent investment (and that’s true).
Third, I don’t recommend flipping houses. Where that’s coming from I don’t know. Whether picking the right stock is less work, however, than flipping houses is debateable. How do you pick the right stock?
I’ll contact my broker and get to the bottom of your last point.
Bottom line, real estate investing and stock market investing are very different. The stock market and the real estate market are very different. Comparing the two through statements like “Stock market returns have been more lucrative than Vancouver real estate returns,” is a pretty tough thing to actually pull off.
You admit, I think, that success in the stock market “really depends on your investment knowledge”. Did double digit returns on real estate (factor in leverage and they become triple digit) depend on specialized knowledge? Or did someone simply have to buy? Its obvious that the two markets are completely different and very difficult to compare on the surface.
Rob- Yes I mean stock market. What did Campbell say?
He said that the fears of recession in the US may be overblown and they may dodge it. I don’t think that was his opinion – I think he was reporting on what people are starting to say, and we’ve seen the same stuff in other areas (check domus’ link from the NYT, for example).
Flipping houses doesn’t refer to you. Since I have renovated in the past and impressed a realtor with the transformation; they wanted me to buy places through them, fix them up and let them sell it. I declined. Good deal for the realtor.
How do you pick the right stock?
Management track record
Total sales – capitalization/market value
Really? Its that simple? What numbers did Petrobank have? What were the future prospects? What did you find out about the management team?
And how did that compare to RIM?
Or the Potash company of Saskatchwan? (Wouldn’t you have liked to be working for those guys?)
Stock market: hard to pick big winners, wide variation in the performance of stocks, easy to liquidate, hard to mortgage, requires special knowledge, returns can be unbelievable, but the asset purchased can completely disappear.
Real estate: hard to liquidate, easy to mortgage, does not require special knowledge, all real estate in the market performs in a similar fashion, returns are conservative, but traditionally are improved by leverage, and the asset never disappears.
My conclusion: very tough to compare the stock market and the real estate market. There are more differences than similarities.
Your conclusion (I think): “Stock market returns have been more lucrative than Vancouver real estate returns”
You’ve also said “As a realtor you can pick a house that will appreciate faster and sell quicker, and investors do similar only with stocks”. If you’re implying that some properties will go up 2700%, like petrobank, while others lose value, you’re wrong. In real estate the playing field is much more level.
It seems you take umbridge with these 3 words – “this could be”.
Unfortunately, crystal balls that declare 100% certainty are a commodity unafforable to me. Others seem to have cornered the market? Delivering catagorical pontifications on the ups and downs of Real Estate in Vancouver is something better left to them. Making BLUESKY decisions for someone’s financial welfare is beyond the mandate. I merely quibble, equivocate or waffle while they make up their own mind based on provided historical fact. .>)
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