Vancouver Real Estate 'Bubble' at 30-year Peak

[chowhou]

Originally Posted by misher

This case just went to the HRT and if the speculation tax gets struck down I bet you'll suddenly be agreeing with me.

This case seems way less cut-and-dry. This woman seems like she is quite literally the definition of a satellite family member. I'd be very interested if the Human Rights Tribunal actually rules in favour of her.

[misher]

Originally Posted by chowhou

This case seems way less cut-and-dry. This woman seems like she is quite literally the definition of a satellite family member. I'd be very interested if the Human Rights Tribunal actually rules in favour of her.

It is a "speculation and vacancy tax" not a "satellite tax". She doesn't seem like a speculator and she lives in the house.

Btw for condos in Metro Van

February: 1073 units, up 41% from Feb 2019. 3756 total active listings means 29% sales:listing ratio, seller’s market territory.

https://twitter.com/rwittstock/statu...13157685284864

[Sheba]

Originally Posted by misher

It is a "speculation and vacancy tax" not a "satellite tax". She doesn't seem like a speculator and she lives in the house.

If you read up on it you'll find it includes satellite families - which this woman is.

From the article:

Startek is a Canadian citizen, a B.C. resident and has raised four children in her family home of 20 years — but she says her Canadian husband was forced to take a job in the States when a U.S. company bought up his local employer.

He pays his taxes in the United States.

As a result, the B.C. government has told her that makes her an "untaxed worldwide earner"— someone who declares less than 50% of their family income on their Canadian income tax return, making her a member of a satellite family.

[misher]

Originally Posted by Sheba

If you read up on it you'll find it includes satellite families - which this woman is.

From the article:

Yes but it’s not in the name. Plus if you marry someone foreign that makes 2x more than you that makes you a satellite family? Seems discriminatory that the act of marriage changes your status.

If we’re talking about the US they have just as many workers paying taxes here with a family back in the US so we aren’t losing anything overall that’s why we have tax treaties with the US covering this.

If he suddenly began paying taxes here and vice versa workers from the US here paid taxes to the US it wouldn’t change anything.

[nds88]

The Federal Reserve made an emergency rate cut of 50 basis points this morning due to the corona virus impact on global markets. After an initial pop upwards after the announcement, both the S&P 500 and Crude Oil prices are dumping....markets are signalling this was not good enough.

Australia cut rates yesterday and the markets are now pricing in a 90% chance of a Euro rate cut (already in negative rates). I think this primes the pump for Bank of Canada to follow. Will be interesting to see how real estate here plays out with the combination of lower rates (both global + probably going to get a domestic rate cut + stress test revision), but having the corona virus spread fear and stifling global growth and economic activity.

[misher]

Originally Posted by nds88

Will be interesting to see how real estate here plays out with the combination of lower rates (both global + probably going to get a domestic rate cut + stress test revision), but having the corona virus spread fear and stifling global growth and economic activity.

Agreed. As we head into the historically busy Spring season we are seeing massive increases in sales. Realtors are going crazy with business. Detached home sales are up 53%. If the coronavirus is having an effect we haven't seen it yet. For all I know the virus is pushing Chinese/Koreans to buy here because there home real estate markets are dead. We are below the 10 year average but supply is so low that its expected. You'd think people would be avoiding open houses but restaurants and bars are still pretty full and even Chinese in malls aren't all wearing masks.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 2,150 in February 2020, a 44.9 per cent increase from the 1,484 sales recorded in February 2019, and a 36.9 per cent increase from the 1,571 homes sold in January 2020.

Last month’s sales were 15.6 per cent below the 10-year February sales average...

For all property types, the sales-to-active listings ratio for February 2020 is 23.4 per cent. By property type, the ratio is 17.3 per cent for detached homes, 26.9 per cent for townhomes, and 28.4 per cent for apartments.

Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,020,600. This represents a 0.3 per cent increase over February 2019 and a 2.7 per cent increase over the past six months.

Full report:
https://www.rebgv.org/market-watch/m...uary-2020.html

[Changing City]

Originally Posted by misher

Agreed. As we head into the historically busy Spring season we are seeing massive increases in sales. Realtors are going crazy with business. Detached home sales are up 53%. If the coronavirus is having an effect we haven't seen it yet. For all I know the virus is pushing Chinese/Koreans to buy here because there home real estate markets are dead. We are below the 10 year average but supply is so low that its expected.

Bullshit. We're not seeing a 'massive increase in sales'. We're seeing more than last winter, which had some of the lowest sales results on record, but we're still well below the 10 year average, and even lower than the 20 year average.

The reason the sales to listing ratio is higher is because there are 20% fewer homes on the market than a year ago. The '53% increase' in sales of detached is because there were 685 sold, up from 448 in February a year ago - one of the lowest monthly numbers on record. The detached home benchmark price is still lower than a year ago.

[whatnext]

Boo hoo the new flu is making some realtors blue:

Global property deals stall as coronavirus keeps China money at home
-Chinese buyers spent US$13.4 billion on US homes in 2019, the most from any foreign country even as purchases plunged amid trade war
-Property agents are facing the same problems from Singapore to Vancouver with hundreds of millions of Chinese effectively quarantined

Bloomberg
Published: 11:39am, 3 Mar, 2020

...Elsewhere, from Vancouver to Singapore, property agents are facing the same problems as their counterparts in US that rely on Chinese buyers: With hundreds of millions of Chinese effectively quarantined, it is hard to sell real estate.

“People were planning to do open houses in early February and obviously the turnout wasn’t as good,” said Jerry Huang, an agent in Vancouver. “Many investors aren’t planning to come at all, just to follow rules.”...

https://www.scmp.com/business/articl...ina-money-home

[rofina]

Originally Posted by nds88

The Federal Reserve made an emergency rate cut of 50 basis points this morning due to the corona virus impact on global markets. After an initial pop upwards after the announcement, both the S&P 500 and Crude Oil prices are dumping....markets are signalling this was not good enough.

Australia cut rates yesterday and the markets are now pricing in a 90% chance of a Euro rate cut (already in negative rates). I think this primes the pump for Bank of Canada to follow. Will be interesting to see how real estate here plays out with the combination of lower rates (both global + probably going to get a domestic rate cut + stress test revision), but having the corona virus spread fear and stifling global growth and economic activity.

Yup.
Stoked to see where my variable goes from here.

[misher]

Originally Posted by whatnext

Boo hoo the new flu is making some realtors blue:

Global property deals stall as coronavirus keeps China money at home
-Chinese buyers spent US$13.4 billion on US homes in 2019, the most from any foreign country even as purchases plunged amid trade war
-Property agents are facing the same problems from Singapore to Vancouver with hundreds of millions of Chinese effectively quarantined

Bloomberg
Published: 11:39am, 3 Mar, 2020

...Elsewhere, from Vancouver to Singapore, property agents are facing the same problems as their counterparts in US that rely on Chinese buyers: With hundreds of millions of Chinese effectively quarantined, it is hard to sell real estate.

“People were planning to do open houses in early February and obviously the turnout wasn’t as good,” said Jerry Huang, an agent in Vancouver. “Many investors aren’t planning to come at all, just to follow rules.”...

https://www.scmp.com/business/articl...ina-money-home

One concern this article raises is our reliance on Chinese materials which is really going to hit our manufacturing.

But this also applies to developments which are slowing in 2020. In 2017-2019 we began building at the pace we require to keepup with immigration so a decrease is worrisome. We could be looking a upcoming crisis in 2-3 years if we reduce development.

On top of that, the company is searching for alternatives to Chinese building materials such as granite counter-tops for the Gramercy project, which could boost costs by as much as 30 per cent.

[misher]

Chartered accountant faces hearing for alleged illegal condo marketing scheme
Vasant Patel is alleged to have lied to mutual fund regulators who investigated his role in the Murrayville House condo marketing scheme

https://www.tricitynews.com/chartere...eme-1.24089590

[misher]

Interestingly enough, if you correct for inflation Vancouver real estate stayed stable until interest rates were cut down to 0.5% in 2015. The recent cut from 1.75 to 1.25 should have a big impact given historical examples.

[nds88]

Originally Posted by rofina

Yup.
Stoked to see where my variable goes from here.

Bank of Canada just cut rates by 0.5% from 1.75% to 1.25%. Hope our variables go down soon

[rofina]

Originally Posted by nds88

Bank of Canada just cut rates by 0.5% from 1.75% to 1.25%. Hope our variables go down soon

Seen that! Should be a good bit more going to principal instead of interest.

[misher]

Another example of why you shouldn't be a landlord in Vancouver. A half months deposit is ridiculously low.

North Van landlord barred from serving eviction while tenant in jail
A North Vancouver landlord says he can’t understand why B.C.’s Residential Tenancy Office refused to let him formally evict his tenant after the man trashed his basement suite during a standoff with police last month and ended up in jail.

Jason Rivero says the decision makes even less sense now that his tenant, Alexander Dinu Tanasescu, 37, is banned by conditions of his bail from contacting Rivero or setting foot on the block where he lives.

Rivero said he was also outraged after reading in a newspaper article that lawyers at one of his tenant’s prior court appearances were careful to make sure Rivero wouldn’t catch wind of Tanasescu’s legal issues, including a conviction for manslaughter in 2013 after he killed a fellow inmate in jail...

But Rivero said his ordeal was just beginning. The furnished suite was mostly destroyed and his family had to spend three weeks in a hotel while their home was cleaned of teargas residue, he said...

“I acknowledge the landlord made efforts to serve the tenant in person and that the landlord was unable to do so given the circumstances. However, this does not change the service requirements,” wrote the tenancy branch arbitrator.

https://www.vancourier.com/north-van...ail-1.24090359

[nds88]

Originally Posted by misher

Another example of why you shouldn't be a landlord in Vancouver. A half months deposit is ridiculously low.

It's been several years since I had to do a full eviction, bailiff and all. But if I recall correctly, I was unable to get a hold of my tenant at all. We ended up serving notices via taping on the door or some forms required mailing to the mailbox. I never had to physically serve her anything. We still got the court approval for the bailiff. I'm pretty sure this was the case, since she was surprised that that bailiff showed up one morning and then she finally was ready to talk to me.

If this is still the case, then the landlord should be able to just tape notices/mail documents without the tenant needing to be physically served, since the law assumes notice is served X number of days after the applicable serving method.

[rofina]

How about the tenants that cancel last months cheque and stay in the whole month anyway? Worse they get is a forfeit of a damage deposit, which automatically gets them 50% ahead.

[s211]

Originally Posted by rofina

How about the tenants that cancel last months cheque and stay in the whole month anyway? Worse they get is a forfeit of a damage deposit, which automatically gets them 50% ahead.

Can delinquent tenants be reported to credit agencies?

[whatnext]

What was that one of our forumers was saying about West van demographics?

Douglas Todd: Housing bubbles bursting in Metro Vancouver's investor-driven neighbourhoods
Opinion: The people who used to invest heavily in West Vancouver real estate “have homes all over the world,” says realtor Nicole Lee. Many have now moved on, leery of B.C.'s targeted taxes.

DOUGLAS TODD Updated: March 4, 2020

“Forget Canada. We’ll go somewhere else.”

That’s what West Vancouver realtor Nicole Lee says many rich clients from Asia are telling her now that B.C. has brought in a foreign-buyers tax on housing, along with a speculation and vacancy tax.

The veteran realtor maintains Victoria’s “artificial measures” are hurting the detached luxury housing market in West Van, where she says many investors from Asia, specifically China, had been busily buying properties and, to fit their trans-Pacific lifestyle, leaving them empty for much of the year...

...An interactive Postmedia News chart of B.C. Assessment valuations of detached homes across more than 160 Metro neighbourhoods (see above) shows that in one year average prices plummeted by up to 25 per cent in tony West Van communities such as Chartwell, Upper Caulfield, Queens, Dundarave and the British Properties.

Other neighbourhoods in Metro experienced equally dramatic one-year price plunges in detached homes, especially Vancouver’s costly Shaughnessy, the University of B.C.’s super-expensive Endowment Lands and some medium-valued neighbourhoods in Richmond.

Across Metro assessments this year went down by an average of about 11 per cent...

...West Van’s Lee — whose realtor’s website features a neighbourhood map in both English and Chinese — predicted there will be about five years of “teeter-totter” prices before her region of the North Shore again sees big jumps. The people who used to invest heavily in West Van “have homes all over the world,” Lee said. Now many have moved on, even though they liked West Van’s good schools and new Asian supermarkets.

Asked how her buyers dealt with heavy traffic congestion on the Lion’s Gate Bridge, Lee said most didn’t care, since many live much of the year out of the country. “And a lot of them don’t work nine-to-five.”...

Veteran city Coun. Craig Cameron said West Van’s housing prices had been driven up by a “massive speculation frenzy” that began about five years ago, which has left an estimated 10 per cent of dwellings empty....

https://vancouversun.com/opinion/col...neighbourhoods

[rofina]

Originally Posted by whatnext

What was that one of our forumers was saying about West van demographics?

Douglas Todd: Housing bubbles bursting in Metro Vancouver's investor-driven neighbourhoods
Opinion: The people who used to invest heavily in West Vancouver real estate “have homes all over the world,” says realtor Nicole Lee. Many have now moved on, leery of B.C.'s targeted taxes.

DOUGLAS TODD Updated: March 4, 2020

“Forget Canada. We’ll go somewhere else.”

That’s what West Vancouver realtor Nicole Lee says many rich clients from Asia are telling her now that B.C. has brought in a foreign-buyers tax on housing, along with a speculation and vacancy tax.

The veteran realtor maintains Victoria’s “artificial measures” are hurting the detached luxury housing market in West Van, where she says many investors from Asia, specifically China, had been busily buying properties and, to fit their trans-Pacific lifestyle, leaving them empty for much of the year...

...An interactive Postmedia News chart of B.C. Assessment valuations of detached homes across more than 160 Metro neighbourhoods (see above) shows that in one year average prices plummeted by up to 25 per cent in tony West Van communities such as Chartwell, Upper Caulfield, Queens, Dundarave and the British Properties.

Other neighbourhoods in Metro experienced equally dramatic one-year price plunges in detached homes, especially Vancouver’s costly Shaughnessy, the University of B.C.’s super-expensive Endowment Lands and some medium-valued neighbourhoods in Richmond.

Across Metro assessments this year went down by an average of about 11 per cent...

...West Van’s Lee — whose realtor’s website features a neighbourhood map in both English and Chinese — predicted there will be about five years of “teeter-totter” prices before her region of the North Shore again sees big jumps. The people who used to invest heavily in West Van “have homes all over the world,” Lee said. Now many have moved on, even though they liked West Van’s good schools and new Asian supermarkets.

Asked how her buyers dealt with heavy traffic congestion on the Lion’s Gate Bridge, Lee said most didn’t care, since many live much of the year out of the country. “And a lot of them don’t work nine-to-five.”...

Veteran city Coun. Craig Cameron said West Van’s housing prices had been driven up by a “massive speculation frenzy” that began about five years ago, which has left an estimated 10 per cent of dwellings empty....

https://vancouversun.com/opinion/col...neighbourhoods

I'm glad this makes a very specific distinction that is often lost around here - investor driven neighborhoods. As in, not all of Vancouver is driven on momentum and speculation.

The market resurgence you are seeing now is end user, locals looking to buy whats affordable to live in, and that's one and 2 bedroom condos.

Its only at West Van, UBC, Point Grey levels can we start to talk about global capital. There isn't enough people in Canada to afford the houses in the BP's alone. How many Canadians can afford $20 million + homes?