Vancouver Real Estate 'Bubble' at 30-year Peak

[red-paladin]

Originally Posted by Cypherus

Canada also has the most natural resources, but its citizens who equal the population of California alone, pay generally the highest amount of taxes compared to the whole world. As well, most citizens are priced out of many metropolitan real estate markets. There's a reason why BC = 'Bring Cash" in many common circles.

No, no we don't.

[Pinion]

Who moves TO South Africa? I don't think I've ever mentioned the country once on this forum.

[Abii]

Originally Posted by Alex Mackinnon

You're going to miss it then. Chances are you may have already missed the boat.

Missed what boat? Are you talking about my window to sell? I don't know. I've been monitoring sales in my building and this last week has been insane. All time highs in both listed and sold prices.

Originally Posted by Cypherus

Agree. It is a good time to cash out for condo's but they can continue to go up in Vancouver. Even in Surrey, one bedrooms have surpassed $400K and there is no limit in sight as to how far up they can go in the whole region. Surrey's upswing also puts demand pressure for downtown Vancouver because the price differential is getting thin (hence Vancouver condo being more valuable for relatively a bit more). Make no mistake, even if there is a crackdown on foreign ownership, most condo's here in Vancouver are bought by "Homemakers and Students" who are permanent residents, but using money from their mom and dad or brother/sister/husband offshore because Canada is a safe haven for accumulated family wealth from Chinese authorities. These condos are actually foreign owned but the title is registered to a local resident such as a Student/Homemaker. The federal Liberal government and BC NDP haven't figured that out yet. The banks, especially RBC, have known this all along, giving out 1 million plus mortgages to someone who has no income. FINTRAC also sees this because every EFT up to $50,000 US from China is recorded, but they are pretty much silent on the issue.

Yeah I thought prices would cool a tad bit after the start of the year, but in my building people suddenly started listing their units for tens of thousands more than a week before. Almost in unison. It's probably due to the assessments, but it's not like those were going to be a surprise. We all knew they were going to be out in week 1 of January. Plus, everybody was already selling way above assessments anyway. It's as if the norm is to sell X percent over what the assessment says and if a new one comes out, you adjust prices just so you can remain way above that value

Vancouver prices never cease to amaze me. At this point I've owned the unit for 2.2 years and it's gone up in value by 100k/year!!! When I bought it, I got it with the intention of selling it in 5-10 years in order to pay for my law school expenses. But now that it's up 200k in 2 years I have no intention of hanging on to it. Someone else can have fun with it. I hope it keeps up until May. Another 20-30k would be

[Alex Mackinnon]

Originally Posted by Abii

Missed what boat? Are you talking about my window to sell? I don't know. I've been monitoring sales in my building and this last week has been insane. All time highs in both listed and sold prices.



Yeah I thought prices would cool a tad bit after the start of the year, but in my building people suddenly started listing their units for tens of thousands more than a week before. Almost in unison. It's probably due to the assessments, but it's not like those were going to be a surprise. We all knew they were going to be out in week 1 of January. Plus, everybody was already selling way above assessments anyway. It's as if the norm is to sell X percent over what the assessment says and if a new one comes out, you adjust prices just so you can remain way above that value

Vancouver prices never cease to amaze me. At this point I've owned the unit for 2.2 years and it's gone up in value by 100k/year!!! When I bought it, I got it with the intention of selling it in 5-10 years in order to pay for my law school expenses. But now that it's up 200k in 2 years I have no intention of hanging on to it. Someone else can have fun with it. I hope it keeps up until May. Another 20-30k would be

I'm more saying that trying to time the market is generally a bad idea if you have something that's not super quick to sell. If that's how you're playing it, you're more likely to pile in right after the crash starts and get stuck an asset you don't want.

Right now, it looks like the values of detached houses and condos are starting to converge. To me that says bad things are right around the corner.

[whatnext]

Originally Posted by Alex Mackinnon

I'm more saying that trying to time the market is generally a bad idea if you have something that's not super quick to sell. If that's how you're playing it, you're more likely to pile in right after the crash starts and get stuck an asset you don't want.

Right now, it looks like the values of detached houses and condos are starting to converge. To me that says bad things are right around the corner.

Detached houses have stalled. Basically they’re only going to buyers who can spirit money out of China or the odd local millionaire . Condos have a way to go before they get there, though townhouses are closing in. The province needs to give cities more zoning power to control what gets built and what rax rates apply depending on assessment.

[rofina]

Originally Posted by whatnext

Detached houses have stalled. Basically they’re only going to buyers who can spirit money out of China or the odd local millionaire . Condos have a way to go before they get there, though townhouses are closing in. The province needs to give cities more zoning power to control what gets built and what rax rates apply depending on assessment.

Yes - interesting divergence.

The strata market seems to be picking up all the slack.

For locals it could set up some interesting buying opportunities.

One more strong year for condo, and weak year for SFH and I'm taking the plunge hopefully in the fall.

[Alex Mackinnon]

Home sales lowest since great recession.

Good timing, since there's a record amount of construction ongoing. Isn't this what makes a crash? Exuberant highs followed by a hangover?

[misher]

Originally Posted by Alex Mackinnon

Home sales lowest since great recession.

Good timing, since there's a record amount of construction ongoing. Isn't this what makes a crash? Exuberant highs followed by a hangover?

Housing starts are way down. Hope it’s a blip or we’re going to have another crisis in a decade.

https://business.financialpost.com/p...s-in-september

I don’t like what the government is doing it’s too unstable and risky. Sharp declines are dangerous.

[Vin]

Remember fear of the doom and gloom in 2008? Housing sales numbers started dwindling and prices even tumbled for many areas. Lasted for about a year or two. This time round, if most people believe that many of the properties are held by speculators, there is no way people will let go of them at discounted prices. They would just wait for the opportunity to resell. As for newer condos, it seems that many are still selling like hot cakes. Therefore I don't believe that a crash will happen here.

The government made a knee-jerk reaction to what's happening here due to the voices of the people, but it only serves to increase the government coffers: most ordinary folks still can't afford SFHs pretty much anywhere in Vancouver.

Well, at least we are getting a lot more modular housing: so it does benefit certain segment of the society.

[misher]

Originally Posted by Vin

Remember fear of the doom and gloom in 2008? Housing sales numbers started dwindling and prices even tumbled for many areas. Lasted for about a year or two. This time round, if most people believe that many of the properties are held by speculators, there is no way people will let go of them at discounted prices. They would just wait for the opportunity to resell. As for newer condos, it seems that many are still selling like hot cakes. Therefore I don't believe that a crash will happen here.

The government made a knee-jerk reaction to what's happening here due to the voices of the people, but it only serves to increase the government coffers: most ordinary folks still can't afford SFHs pretty much anywhere in Vancouver.

Well, at least we are getting a lot more modular housing: so it does benefit certain segment of the society.

Is it bad if I call modular housing luxury modular housing? I feel like we’re building housing that looks awesome but will only house a minority instead of building housing that looks worse but will house the majority?

A comparison is do you take a few homeless out to fine dining or give them all a happy meal.

[logan5]

I thought the benefit of modular housing was that it is cheap to build. The happy meal of housing. What’s cheaper than modular housing?

[misher]

Originally Posted by logan5

I thought the benefit of modular housing was that it is cheap to build. The happy meal of housing. What’s cheaper than modular housing?

For one, instead of 220sqft modular housing, 110sqft modular housing. Or putting 2-4 bunks in each unit.

We’re housing people in standards better than a university dormitory and in return we pay extra, we don’t have enough to build for everyone so we just house a minority and pat ourselves in the back for the luxury we’ve put them in.

[MIPS]

Originally Posted by logan5

I thought the benefit of modular housing was that it is cheap to build. The happy meal of housing. What’s cheaper than modular housing?

I can go through Craigslist or even a new sales lot and find any number of RV's with arguably more square footage and better amenities than what the market currently offers for less than $250000.
Modular Housing is great on paper only when it's built cheap and sold at "market rate" where it shuts out the target population it is designed to serve.
It's like calling it "LoW-Income Housing" and the starting prices are $300K.

[Vin]

Originally Posted by logan5

I thought the benefit of modular housing was that it is cheap to build. The happy meal of housing. What’s cheaper than modular housing?

You still need funding from the provincial government. Guess where the BC governemnt gets the bulk of its revenue from? BTW each unit for the modular housing costs upwards of $100,000. They are not exactly "cheap".

Originally Posted by MIPS

I can go through Craigslist or even a new sales lot and find any number of RV's with arguably more square footage and better amenities than what the market currently offers for less than $250000.
Modular Housing is great on paper only when it's built cheap and sold at "market rate" where it shuts out the target population it is designed to serve.
It's like calling it "LoW-Income Housing" and the starting prices are $300K.

Not sure if our homeless or affordable housing population would want to live in an RV park in some far-flung municipality from Vancouver's city centre. Somebody can try to convince them maybe?

[misher]

Originally Posted by MIPS

I can go through Craigslist or even a new sales lot and find any number of RV's with arguably more square footage and better amenities than what the market currently offers for less than $250000.
Modular Housing is great on paper only when it's built cheap and sold at "market rate" where it shuts out the target population it is designed to serve.
It's like calling it "LoW-Income Housing" and the starting prices are $300K.

Exactly, we should have been using repurposed used RV's or even shipping containers. Something that costs us less than $100k a unit, and would last longer than a few years.

Note that its called "temporary" modular housing and I think they only mean it to be up for a few years....I'm wondering what our losses will be at the end, will we recycle and get back most of the cost or are we out the full cost?

[Vin]

Originally Posted by misher

Is it bad if I call modular housing luxury modular housing? I feel like we’re building housing that looks awesome but will only house a minority instead of building housing that looks worse but will house the majority?

A comparison is do you take a few homeless out to fine dining or give them all a happy meal.

You are right. This city is built for for the extreme ends of the wealth ladder. Perhaps then the City planners can either win the hearts of those with money or those NGOs with a conscience (respectively, revenue and political points secured). The silent middle class is somehow forgotten and pushed further into the suburbs.

[ssiguy]

Vancouver will have a large housing collapse because, wait for it, it`s not different here. Things have changed greatly since 2008. In 2008 interest rates were falling, the government introduced 40 year mortgages, getting a CHMC loan was simply, money was flying out of China at a dizzying pace, prices were half what they are now, Vancouver was one of Canada`s fastest growing cities, and you had all levels of government doing everything in their power to rejuvenate the housing market to pull the country/province out of recession.

Today is quite different Mortgages are harder to get and now can be had for a maximum of 25 years and have higher downpayment requirements, have higher interest rates, a CMHC stress test, China has introduced extreme measures to halt the flight of capitol fleeing the country, Vancouver is now one of Canada`s slowest growing metros, prices have soared well beyond even the upper middle class, an empty housing tax, a foreign buyers tax, and a public who are fed up with foreign buyers, outrageous prices, non-existent rentals, historic building demolitions, empty neighbourhoods, tax evasion, renovictions, and seeing their friends and family leave the city for greener pastures outside metro and even the province.


Also, when you have housing based on speculation like in Vancouver where prices have become totally detached from basic economics and local wages, housing is at the whim of........speculation. Housing in Vancouver is far less a commodity than it is a stock........something you buy not for it`s values but for potential returns. The problem is that stocks are at the whim of public perseption. It takes very little, as we are now witnessing, that the`buy now or you will never buy` has turned quickly into `sell now or you will never sell`. Stocks, like housing, however can fall MUCH faster than they appreciate for the simply reason that increasing prices requires more money and falling prices requires less.

[misher]

Originally Posted by ssiguy

Vancouver will have a large housing collapse because, wait for it, it`s not different here. Things have changed greatly since 2008. In 2008 interest rates were falling, the government introduced 40 year mortgages, getting a CHMC loan was simply, money was flying out of China at a dizzying pace, prices were half what they are now, Vancouver was one of Canada`s fastest growing cities, and you had all levels of government doing everything in their power to rejuvenate the housing market to pull the country/province out of recession.

Today is quite different Mortgages are harder to get and now can be had for a maximum of 25 years and have higher downpayment requirements, have higher interest rates, a CMHC stress test, China has introduced extreme measures to halt the flight of capitol fleeing the country, Vancouver is now one of Canada`s slowest growing metros, prices have soared well beyond even the upper middle class, an empty housing tax, a foreign buyers tax, and a public who are fed up with foreign buyers, outrageous prices, non-existent rentals, historic building demolitions, empty neighbourhoods, tax evasion, renovictions, and seeing their friends and family leave the city for greener pastures outside metro and even the province.


Also, when you have housing based on speculation like in Vancouver where prices have become totally detached from basic economics and local wages, housing is at the whim of........speculation. Housing in Vancouver is far less a commodity than it is a stock........something you buy not for it`s values but for potential returns. The problem is that stocks are at the whim of public perseption. It takes very little, as we are now witnessing, that the`buy now or you will never buy` has turned quickly into `sell now or you will never sell`. Stocks, like housing, however can fall MUCH faster than they appreciate for the simply reason that increasing prices requires more money and falling prices requires less.

I have a theory that Vancouver real estate is propped up by the rest of Canada thus no matter what we do to raise taxes and make ownership unattractive this will be mitigated. An example is how prices of wheat go up when rice prices go up. As long as Toronto real estate stays high and rest of BC/Canada is up we will be up no matter how low demand goes.

[MIPS]

Originally Posted by Vin

Not sure if our homeless or affordable housing population would want to live in an RV park in some far-flung municipality from Vancouver's city centre. Somebody can try to convince them maybe?

City has been pretty leniant about RV parking on city streets as long as you keep the place clean and move every few days. I don't consider living just off Terminal Avenue far-flung either and given how many campers are already parked in that area, so do a lot of other people.

[Alex Mackinnon]

Originally Posted by misher

Is it bad if I call modular housing luxury modular housing? I feel like we’re building housing that looks awesome but will only house a minority instead of building housing that looks worse but will house the majority?

A comparison is do you take a few homeless out to fine dining or give them all a happy meal.

Originally Posted by misher

Exactly, we should have been using repurposed used RV's or even shipping containers. Something that costs us less than $100k a unit, and would last longer than a few years.

Note that its called "temporary" modular housing and I think they only mean it to be up for a few years....I'm wondering what our losses will be at the end, will we recycle and get back most of the cost or are we out the full cost?

So you want people to live in things that aren't designed for permanent human inhabitation? That sounds real cheap and efficient.

If you've ever used a temporary seacan office, they're drafty as all hell. I've had one office that couldn't get above -2 °C when it was -35 °C outside at the mine I was working at because the heating couldn't keep up. RVs similarly aren't known for being warm places to live. They are however known for not having sewage hookups, or power.

Dorms in a university generally don't have a kitchen, although some recent ones have bathrooms. The thing to consider is that dorms generally have a cafeteria. Do you really want to have to provide a cafeteria for grown ass adults or do you just want them to cook for themselves. The alternative is having a bunch of poor people eating fast food all the time, which more expensive and a huge liability for the healthcare system which society also pays for.

I have to say your idea of "luxury" is quite perverse. 220 sq.ft. is about as small of a space as you can fit a bathroom, kitchenette and bed in. People living in subsidized housing should live in buildings that meet the building code, not some halfassed shanty. Did you grow-up living a cardboard box or something, resentful of people living in slightly better cardboard boxes?