Vancouver Real Estate 'Bubble' at 30-year Peak

[rofina]

Originally Posted by nds88

BoC just cut rates by another 50 basis points. Key overnight rate went from 1.25% to 0.75%. Those on variable mortgage rates should be expecting a 1% or close to 1% cut off their payments over a course of a couple weeks. We will probably be heading to 0% overnight rates soon.

We are just high fiveing about the other rate cut, time to about this one too.

Hope it gets passed on once again. This is awesome. There goes another 2 years off the mortgage.

[vanman]

Originally Posted by whatnext

Nice to see some stratas busting illegal AirBnB scum first hand:

Vancouver strata president busts illegal Airbnb by renting condo unit, owner fined over $46,000
by Carlito Pablo on March 11th, 2020 at 4:13 PM

A Vancouver condo owner was found to have repeatedly violated her strata’s bylaws by using her unit for short-term rentals.

For these offences, Suqian Zhang was ordered by a B.C. Civil Resolution Tribunal to pay a total of $46,400.77 in fines.

The evidence against Zhang included a September 2018 booking of her unit by the strata president at the time...

...SN also recorded licensed plates of more than 60 different vehicles parked at Zhang’s parking spot between April 2018 and July 1, 2019.

Gibson said the number of different cars recorded to have parked at Zhang’s stall “over the time period is significant”.

According to Gibson, this is “inconsistent” with Zhang’s claim that there are “occasional guests”.

Zhang has claimed that only three tenants occupied her condo, “all for periods of more than 30 days”.

“The owner says that she allowed her brother, his friend and her realtor to caretake the unit while she was out of the country,” Gibson wrote....

https://www.straight.com/news/137185...ner-fined-over

Really nice to see stratas cracking down hard on this.

[nds88]

Originally Posted by rofina

We are just high fiveing about the other rate cut, time to about this one too.

Hope it gets passed on once again. This is awesome. There goes another 2 years off the mortgage.

Cheers mate

[misher]

Real estate sales in Vancouver going strong but Remax is closing down open houses with others likely soon to follow. Possibly everything will just take a pause.

VanRE apartment sales update: Yesterday was soft with 40 sales, would've expected ~70. Today was within the range of normalcy with 54 sales.

https://twitter.com/rwittstock/statu...16079151611905

[rofina]

Originally Posted by nds88

Cheers mate

Sitting pretty close to free money on my mortgage right now, assuming inflation remains where it was pre beer flu.

That being said, I lost wayyyyyy more in the equities market than I'm saving on my mortgage.

I thought 2008 was bad, this is almost comical.

[Changing City]

BC Realtors seem to think things will be slow for quite a while. "BC is facing a sudden stop in economic activity with little guidance to when things may return to normal.
Based on our scenario analysis, BC home sales and prices will likely face declines in the spring and early summer"

The change to the mortgage stress test rate that was to come into effect in April, has been postponed because interest rates have fallen. However, RBC just increased their mortgage cost by almost half a point, with a five year rate traveling from 2.95% to 3.34%.

[nds88]

Originally Posted by rofina

Sitting pretty close to free money on my mortgage right now, assuming inflation remains where it was pre beer flu.

That being said, I lost wayyyyyy more in the equities market than I'm saving on my mortgage.

I thought 2008 was bad, this is almost comical.

Perhaps a bit of foot in mouth last week -_-

I don't think last week anyone was really expecting, or fully able to comprehend, the reaction to have followed this week. As controversial as this may sound, I think the reaction to the beer flu may end up being more damaging than the beer flu itself.

Think of it this way, if rates were not cut, equities would still be down and your mortgage payment would be higher.

The learning lesson I am taking away from this is to never live on the edge and be prepared. Fortunately I have prepared myself for good times and bad times.

Hang tight. We ride together, we die together.

[misher]

Sales still going strong.

Note that I expect them to slow too. But its not happening significantly yet.

52
@Rebgv
apartment sales again today. Even I'm surprised. 852 sales MTD. By tomorrow we will have eclipsed March 2019's sales total. We'll see what next week brings.

https://twitter.com/rwittstock/statu...20562781323265

[rofina]

Originally Posted by misher

Sales still going strong.

Note that I expect them to slow too. But its not happening significantly yet.



https://twitter.com/rwittstock/statu...20562781323265

This goes to show how comically bad 2019 was, if during this pandemic we can still beat 2019 sales volume.

[rofina]

Originally Posted by nds88

Perhaps a bit of foot in mouth last week -_-

I don't think last week anyone was really expecting, or fully able to comprehend, the reaction to have followed this week. As controversial as this may sound, I think the reaction to the beer flu may end up being more damaging than the beer flu itself.

Think of it this way, if rates were not cut, equities would still be down and your mortgage payment would be higher.

The learning lesson I am taking away from this is to never live on the edge and be prepared. Fortunately I have prepared myself for good times and bad times.

Hang tight. We ride together, we die together.

I hear you internet friend! I hope this underscores the importance of a rainy day fund to those who do not have one.

That being said, I agree. Some hope out there though as China and now Japan get back to normal, and BC cases are no longer doubling.

here is to all of us, and a positive outcome given the dire circumstances.

[whatnext]

An article from today's NY Times shows exactly why taxes targetting satellite families were needed:

...After she gave birth to Lily in China in 2013, her husband sponsored her and her daughter to emigrate to Canada. But she said things quickly soured, with her husband often away. While in China, he rented out several properties there, becoming prosperous and buying two homes in Vancouver.

Many astronaut families reside in Richmond, a city near Vancouver’s airport with a large Chinese-speaking population, rows of large houses and sprawling shopping malls with signs in Chinese.

On a recent afternoon at a food court there, Ms. Ye, the woman who divorced her husband, lamented the sacrifices the astronaut lifestyle had entailed for her and her daughter Lily, 6, who sat quietly drawing in a coloring book.

Despite his wealth, she said when he was in Vancouver he worked in low-end jobs as a waiter or in a supermarket in order to earn just enough money to maintain his permanent residency status. Taking low-skilled jobs to keep residency status is not uncommon among astronaut families when the breadwinner can’t find more lucrative work. 

After her husband blamed her for not giving birth to a son, the two divorced. She has no long-term interest in staying in Vancouver.

“The only reason I stay in Canada is for my daughter. As soon as she receives her Canadian citizenship, I’ll go back to China,” she said....

https://www.nytimes.com/2020/03/21/w...mmigrants.html

[cornholio]

Originally Posted by nds88

Perhaps a bit of foot in mouth last week -_-

I don't think last week anyone was really expecting, or fully able to comprehend, the reaction to have followed this week. As controversial as this may sound, I think the reaction to the beer flu may end up being more damaging than the beer flu itself.

Think of it this way, if rates were not cut, equities would still be down and your mortgage payment would be higher.

The learning lesson I am taking away from this is to never live on the edge and be prepared. Fortunately I have prepared myself for good times and bad times.

Hang tight. We ride together, we die together.

It s obvious this was going to happen but its easy for me to say as I live in a country well ahead of Canada in preparation where everything went into protection mode quite a while ago. As for the reaction causing more harm? You don't comprehend what we are up against. In all probability it will be nearly 2 years before the world is back to normal including Canada. No reaction would mean over 2 plus million deaths in Canada before this fall as all hospital capacity would be exceeded by hundreds if not thousands of percent by peak sometime around summer. Your best case scenario now is that the reaction was not too late and active case loads will be brought down to a manageable level quick (hospital capacity will be exceeded in the coming weeks and everything now is about getting active cases back down then). After we are talking about possible 2 years of various restrictions and rolling localized quarantines with only a few possible exits out of this global state, the preferred one being a eventual vaccine which probably 2 years away if there are no complications... Following all this the world will be a fundamentally changed place.

So if you think this is something that will go away some time soon, like this year. It wont. How will it effect housing prices? I have no idea, everything happening now in our globalized world is unprecedented and there are many more surprises that will happen this year as a result. The market is different now in pretty much every way imaginable then one month ago and its not going back.

[misher]

Originally Posted by cornholio

It s obvious this was going to happen but its easy for me to say as I live in a country well ahead of Canada in preparation where everything went into protection mode quite a while ago. As for the reaction causing more harm? You don't comprehend what we are up against. In all probability it will be nearly 2 years before the world is back to normal including Canada. No reaction would mean over 2 plus million deaths in Canada before this fall as all hospital capacity would be exceeded by hundreds if not thousands of percent by peak sometime around summer. Your best case scenario now is that the reaction was not too late and active case loads will be brought down to a manageable level quick (hospital capacity will be exceeded in the coming weeks and everything now is about getting active cases back down then). After we are talking about possible 2 years of various restrictions and rolling localized quarantines with only a few possible exits out of this global state, the preferred one being a eventual vaccine which probably 2 years away if there are no complications... Following all this the world will be a fundamentally changed place.

So if you think this is something that will go away some time soon, like this year. It wont. How will it effect housing prices? I have no idea, everything happening now in our globalized world is unprecedented and there are many more surprises that will happen this year as a result. The market is different now in pretty much every way imaginable then one month ago and its not going back.

Prices "should" decline. But the thing with increasing population and high development costs is that when prices decline but costs don't, no supply is created and demand will just catchup pushing prices high enough again to create more supply. So long-term (5-10 years) real estate is still a good investment. Many commercial transactions are happening now because developers plan for prices 5 years from now not 2 months from now. The math is there for prices to be crazy high again.

[cornholio]

Originally Posted by misher

Prices "should" decline. But the thing with increasing population and high development costs is that when prices decline but costs don't, no supply is created and demand will just catchup pushing prices high enough again to create more supply. So long-term (5-10 years) real estate is still a good investment. Many commercial transactions are happening now because developers plan for prices 5 years from now not 2 months from now. The math is there for prices to be crazy high again.

Population growth its self doesn't drive prices. Demand outstripping supply does. You can have population growth without demand outstripping supply. You can also have demand outstripping supply without population growth. But in the long run supply is always pressured to meet demand and at some point will..some point can be far away though. As for what will happen in the next month who knows. What will happen in 2 years is a guess for everyone on this planet right now. The world is going through a fundamental change right now and it will come out different in many ways and we just dont know which ways.

[nds88]

Originally Posted by cornholio

It s obvious this was going to happen but its easy for me to say as I live in a country well ahead of Canada in preparation where everything went into protection mode quite a while ago. As for the reaction causing more harm? You don't comprehend what we are up against. In all probability it will be nearly 2 years before the world is back to normal including Canada. No reaction would mean over 2 plus million deaths in Canada before this fall as all hospital capacity would be exceeded by hundreds if not thousands of percent by peak sometime around summer. Your best case scenario now is that the reaction was not too late and active case loads will be brought down to a manageable level quick (hospital capacity will be exceeded in the coming weeks and everything now is about getting active cases back down then). After we are talking about possible 2 years of various restrictions and rolling localized quarantines with only a few possible exits out of this global state, the preferred one being a eventual vaccine which probably 2 years away if there are no complications... Following all this the world will be a fundamentally changed place.

So if you think this is something that will go away some time soon, like this year. It wont. How will it effect housing prices? I have no idea, everything happening now in our globalized world is unprecedented and there are many more surprises that will happen this year as a result. The market is different now in pretty much every way imaginable then one month ago and its not going back.

I don't know which Country you are in, but watching other countries' reaction is not entirely something to rely on for us to mimic. Taiwan was able to quickly contain the spread. China was able to shut down a metro area of 60+ million people and literally barricaded apartment doors shut. I think Japan was able to put in quick action too. These countries are authoritarian countries (except Japan, but they are a collectivist culture). European countries are not authoritarian, but their culture does not emphasize liberty to the degree we do in North America.

I thought we had limits and checks/balances on government powers. Yes, it makes complete sense to not allow anyone into the country that has corona symptoms. If you are not a Canadian citizen, we can shut close the border to you. However, this was quoted in the National Post:

Trudeau said the government would also mandate that airlines would have to do a basic health assessment of anyone travelling, including citizens, and anyone who might have the virus will not be allowed to travel to Canada.

“Anyone who has symptoms will not be able to come to Canada.”

That's messed up. We have a constitution that says: 6. (1) Every citizen of Canada has the right to enter, remain in and leave Canada.

Trudeau doesn't need to go out and get toilet paper, he just used the constitution as it.

Likewise with new measures in place. A $1,000 fine for being closer than 6 feet from another person. Forcing businesses to close over night. Not allowing X number of people to your house.

I'm not saying I don't agree with strict measures and I think it makes perfect logical sense for people not to congregate in groups or go out for non essential purposes. My concern is the amount of power and seemingly arbitrary actions that can be put in place overnight. After this is over, the powers in place will realize what they can get away with and at what threshold level. This will set us up for a lot of freedoms being stripped away, new taxes implemented and used corruptly, and arbitrary rules/regulations being in place.

This was an interesting article that popped up in my feed https://cyprus-mail.com/2020/03/16/r...-at-all-times/

[spaceprobe]

Originally Posted by nds88

I don't know which Country you are in, but watching other countries' reaction is not entirely something to rely on for us to mimic. Taiwan was able to quickly contain the spread. China was able to shut down a metro area of 60+ million people and literally barricaded apartment doors shut. I think Japan was able to put in quick action too. These countries are authoritarian countries (except Japan, but they are a collectivist culture). European countries are not authoritarian, but their culture does not emphasize liberty to the degree we do in North America.

I thought we had limits and checks/balances on government powers. Yes, it makes complete sense to not allow anyone into the country that has corona symptoms. If you are not a Canadian citizen, we can shut close the border to you. However, this was quoted in the National Post:

Trudeau said the government would also mandate that airlines would have to do a basic health assessment of anyone travelling, including citizens, and anyone who might have the virus will not be allowed to travel to Canada.

“Anyone who has symptoms will not be able to come to Canada.”

That's messed up. We have a constitution that says: 6. (1) Every citizen of Canada has the right to enter, remain in and leave Canada.

Trudeau doesn't need to go out and get toilet paper, he just used the constitution as it.

Likewise with new measures in place. A $1,000 fine for being closer than 6 feet from another person. Forcing businesses to close over night. Not allowing X number of people to your house.

I'm not saying I don't agree with strict measures and I think it makes perfect logical sense for people not to congregate in groups or go out for non essential purposes. My concern is the amount of power and seemingly arbitrary actions that can be put in place overnight. After this is over, the powers in place will realize what they can get away with and at what threshold level. This will set us up for a lot of freedoms being stripped away, new taxes implemented and used corruptly, and arbitrary rules/regulations being in place.

This was an interesting article that popped up in my feed https://cyprus-mail.com/2020/03/16/r...-at-all-times/

"Every citizen of Canada has the right to enter, remain in and leave Canada." Yes, but no one has an obligation to physically bring you to canada. Airlines don't have to let you on their planes. If you can get to the border without the help of a commercial enterprise (ie. drive or walk), then customs will let you through, and quarantine you for 14 days.

ps. measures such as those you quoted, and even more drastic ones, were implemented during the world wars.

[whatnext]

Originally Posted by spaceprobe

"Every citizen of Canada has the right to enter, remain in and leave Canada." Yes, but no one has an obligation to physically bring you to canada. Airlines don't have to let you on their planes. If you can get to the border without the help of a commercial enterprise (ie. drive or walk), then customs will let you through, and quarantine you for 14 days.

ps. measures such as those you quoted, and even more drastic ones, were implemented during the world wars.

Yep that's what people forget. You might have a right to enter Canada, but not to get on a plane if you might infect many others.

Just another consequence of "casual Canadians" who ping-pong back and forth between countries depending on what helps them best. If you decide to make your money offshore, why should you expect Canada to bring you back here?

[misher]

Originally Posted by nds88

I don't know which Country you are in, but watching other countries' reaction is not entirely something to rely on for us to mimic. Taiwan was able to quickly contain the spread. China was able to shut down a metro area of 60+ million people and literally barricaded apartment doors shut. I think Japan was able to put in quick action too. These countries are authoritarian countries (except Japan, but they are a collectivist culture). European countries are not authoritarian, but their culture does not emphasize liberty to the degree we do in North America.

I thought we had limits and checks/balances on government powers. Yes, it makes complete sense to not allow anyone into the country that has corona symptoms. If you are not a Canadian citizen, we can shut close the border to you. However, this was quoted in the National Post:

Trudeau said the government would also mandate that airlines would have to do a basic health assessment of anyone travelling, including citizens, and anyone who might have the virus will not be allowed to travel to Canada.

“Anyone who has symptoms will not be able to come to Canada.”

That's messed up. We have a constitution that says: 6. (1) Every citizen of Canada has the right to enter, remain in and leave Canada.

Trudeau doesn't need to go out and get toilet paper, he just used the constitution as it.

Likewise with new measures in place. A $1,000 fine for being closer than 6 feet from another person. Forcing businesses to close over night. Not allowing X number of people to your house.

I'm not saying I don't agree with strict measures and I think it makes perfect logical sense for people not to congregate in groups or go out for non essential purposes. My concern is the amount of power and seemingly arbitrary actions that can be put in place overnight. After this is over, the powers in place will realize what they can get away with and at what threshold level. This will set us up for a lot of freedoms being stripped away, new taxes implemented and used corruptly, and arbitrary rules/regulations being in place.

This was an interesting article that popped up in my feed https://cyprus-mail.com/2020/03/16/r...-at-all-times/

I kind of agree but also I kind of disagree. Our constitution never really envisioned the world of 100-200 years in the future. I know the original drafters of the Charter are horrified with what the courts have done with it. And most of the stuff passed was never meant for a crisis. Sometimes parts need to be suspended for a brief duration.

However, its also true that governments, including our own nations, often use a crisis to justify "temporary" measures that they don't revoke after the crisis is over. Income tax being an obvious one. People came and settled Canada partly to get away from taxes so taxes would not have been acceptable to voters had there not been a crisis to justify them.

To bring this topic back to real estate, its very weird that each province has different taxes on real estate.

[jlousa]

Just wrapped up a conference call with Benjamin Tal and they are expecting a huge slow down on rental construction and banks hesitant to lend. The reasoning given is that with travel shutdown Canada is looking at taking in 450,000 less immigrants over the next little period. The lack of immigrants will reduce the demand for additional housing.
I also thought it was an overlooked item in the housing shortage, tackling demand was never looked at as seriously as tackling supply, demand is easier to control and faster.

[misher]

Originally Posted by jlousa

Just wrapped up a conference call with Benjamin Tal and they are expecting a huge slow down on rental construction and banks hesitant to lend. The reasoning given is that with travel shutdown Canada is looking at taking in 450,000 less immigrants over the next little period. The lack of immigrants will reduce the demand for additional housing.
I also thought it was an overlooked item in the housing shortage, tackling demand was never looked at as seriously as tackling supply, demand is easier to control and faster.

The Vancouver mindset:

Any attempt to reduce immigration/refugee intake=bad.

Any attack on homeowners/developers/investors/foreigners/the rich=good

So we only focus on ways to make people want to own housing less.

Its like saying we have a classroom shortage, lets cut down on how many people go to university instead of increasing the size of universities.