Canada's 'housing bubble' deemed close to bursting

[st7860]

Creating jobs. Thats what its all about! I do not care if someone buys a house and leaves it empty while paying taxes to the city lol

[st7860]

http://www.straight.com/news/456636/cond...sts-speculation-tax-real-estate-flippers
"He cited sales figures from three projects that he marketed to suggest that foreign buyers form a small portion of overall purchasers in Vancouver.

At the Independent at the corner of East Broadway and Kingsway, only three percent were offshore Asians and two percent were offshore Europeans.

Then he said that at Strathcona Village at 900 East Hastings, none of the buyers were offshore. A third project, Wall Centre Central Park, had less than three percent offshore buyers—17 Asians and 13 Europeans out of 1,009 units sold.

"I'm concerned that we are going to be sending a message to all of our foreign investors from India to Indonesia that if you tax foreign investment on housing on a Monday, you may tax foreign investment on technology, on LNG, and on manufacturing by Friday, hurting job creation," Rennie said."

http://www.theglobeandmail.com/news/brit...to-unaffordable-housing/article24560725/
"The white-hot debate over Vancouver’s sky-high housing costs will be cranked up a notch on Friday when the city’s major condo marketer urges local politicians and neighbourhood groups to allow single-family houses to be torn down and replaced with lower-cost condos and townhouses.

In his yearly speech at a development industry event, Bob Rennie will make the case that politicians and residents need to be bolder about rezoning, because the current gradual approach is limiting the supply of land for condos and townhouses, making them more expensive than they need to be.

Vancouver sees three to four houses torn down every day, and often buildings of good quality are replaced with lesser structures.

More than their parts: Vancouver homeowners, developers eager to gamble on land assemblies


“The demand is there, but the biggest culprit in affordability is no supply,” the always controversial Mr. Rennie said."

[ssiguy]

Originally Posted by st7860

Creating jobs. Thats what its all about! I do not care if someone buys a house and leaves it empty while paying taxes to the city lol

A] Buying real estate does not create any jobs.
B} The property taxes would be paid if a local bought the property.
C} It cost the city more to have empty houses due to the reallocation of funds. Libraries, schools, community centres etc are based on population. If those people are not there then that area is getting a disproportionate amount of those services than their population could support or require.
D} People who buy in these houses but do not live in them hurt local retailers as they population they are serving is not their to buy their goods. This is also true in new developments like Coal Harbour where businesses opened up to support the supposed population and ended up going belly up because so many of the units are empty. This is why Coal Harbour is a dead zone despite the number of condos.

[st7860]

Buying real estate creates jobs. It isn't an Amazon Kindle ebook with electronic delivery. Property taxes are paid if a home is empty. School taxes are paid if a homeowner doesn't have any kids. Libraries and community centres are funded by the city, not the province. The Vancouver school board is relatively unique as it does not(yet) believe in closing unneeded schools whereas other districts would. Its prudent business practice to do market research and for a retail store to scope out the area before you invest in a business.

[casper]

Originally Posted by ssiguy

A] Buying real estate does not create any jobs.
B} The property taxes would be paid if a local bought the property.
C} It cost the city more to have empty houses due to the reallocation of funds. Libraries, schools, community centres etc are based on population. If those people are not there then that area is getting a disproportionate amount of those services than their population could support or require.
D} People who buy in these houses but do not live in them hurt local retailers as they population they are serving is not their to buy their goods. This is also true in new developments like Coal Harbour where businesses opened up to support the supposed population and ended up going belly up because so many of the units are empty. This is why Coal Harbour is a dead zone despite the number of condos.

Jobs were created constructing Coal Harbour. Mostly construction jobs. Lots of short term jobs.

Once the building is built it has a strata council, an engineering study and a reserve fund that it accumulates to maintain the building. That generates jobs. There are likely other services needed to support the supposedly empty building and keep in good repair.

The government gets taxes from all of these properties. This all happens regardless of who owns the property. Without anyone using the service. Sounds like we are a head.

I don't think the number of absentee home owners is all that great.

[whatnext]

Originally Posted by casper

Yes, I do. If you talk to small business owners you discover they are regularly cold called by immigration lawyer and business brokers that want to arrange the sale of their company to an immigrant.

Since this is a class of immigrates that are nominated by the province, they set the rules and they are about to change them. Generally the requirements in the past require the business to have been pre-existing for a certain number of years, employee a certain number of full time employees, there needs to be a commitment to continue to employee that number + 3 etc. new jobs for Canadians. July is when the new updated rules are to be announced. Who know how they will change. http://www.welcomebc.ca/Immigrate/About-the-BC-PNP/Investing-in-B-C.aspx

The investment threshold outside of the lower mainland is lower that in Vancouver, one of the reasons for a fair bit of interest on the island.

The reason someone would pull some of there money out of China to invest in Canada is to hedge there bets and security. The government of China has a pretty poor reputation historically for recognising personal property rights.

Am I surprised that some of this people buy a local business here and then go back to China to continue to run their business over there? No, I am not.

If your intent was to paint a rosy picture of this program you failed miserably. All you did was reinforce the phony and ephemeral nature of the business created to cater to the immigrant investor program. Think about it: these businesses exist solely to gain a Canadian passport. They don't have to turn a profit. Indeed you admit it yourself, the owner goes back to China to run their real business. In the meantime, what about the local businesses that now have to compete and earn a living with someone who doesn't care if they make a profit? There are hundreds of these zombie businesses out there which exist solely as passport getters, they get sold from one immigrant investor to the next, soldiering on merely to gain Canadian citizenship.

[st7860]

Originally Posted by casper

Yes, I do. If you talk to small business owners you discover they are regularly cold called by immigration lawyer and business brokers that want to arrange the sale of their company to an immigrant.

Since this is a class of immigrates that are nominated by the province, they set the rules and they are about to change them. Generally the requirements in the past require the business to have been pre-existing for a certain number of years, employee a certain number of full time employees, there needs to be a commitment to continue to employee that number + 3 etc. new jobs for Canadians. July is when the new updated rules are to be announced. Who know how they will change. http://www.welcomebc.ca/Immigrate/About-the-BC-PNP/Investing-in-B-C.aspx

The investment threshold outside of the lower mainland is lower that in Vancouver, one of the reasons for a fair bit of interest on the island.

The reason someone would pull some of there money out of China to invest in Canada is to hedge there bets and security. The government of China has a pretty poor reputation historically for recognising personal property rights.

Am I surprised that some of this people buy a local business here and then go back to China to continue to run their business over there? No, I am not.

The other person definitely knows little about Canadian programs, since you weren't even talking about the immigrant investor program lol

[st7860]

Originally Posted by casper

Jobs were created constructing Coal Harbour. Mostly construction jobs. Lots of short term jobs.

Once the building is built it has a strata council, an engineering study and a reserve fund that it accumulates to maintain the building. That generates jobs. There are likely other services needed to support the supposedly empty building and keep in good repair.

The government gets taxes from all of these properties. This all happens regardless of who owns the property. Without anyone using the service. Sounds like we are a head.

I don't think the number of absentee home owners is all that great.

Construction jobs have a decent rate of pay for what they are as well, in many cases over $20 an hour. Yes, the government gets taxes for not providing services on an empty home so it shouldn't matter. Also what you didn't mention that is in Vancouver homes over 10 years old or so do not pay their fair share of the water they use since there is no metering.

[st7860]

Originally Posted by sunsetmountainland

I did not want to go on to say this but it is truly incredible how slow and ignorant ssiguy is. His last post really shows how to say nicely uneducated he really is. I am really sorry but your last post on this topic was one of the most stupid!Honestly you have a lot of really stupid things to say. Your mind does not seem to understand facts. That as well as reasonable arguments.

Thanks for the humor though!

It's a mystery why that individual doesn't go off on all those 'foreigners' bidding up waterfront property in his declared city, and just goes after those in Vancouver lol

[lio45]

Originally Posted by caltrane74

... according to the survey, which only looked at a portion of domestic owners and excluded foreign owners, corporate investors and Canadians who own condos in Vancouver or Toronto but live outside those cities.

... not only did they look at domestic owners, non-corporate ones (nearly everyone who's active in real estate beyond only a tiny handful of properties uses corporations for holding their assets), and people who live in the city in the first place, but even then, they looked only at a portion of those?

I'd want to say "not even worth the paper it's printed on", but let's be modern... that BS survey is a total misuse of computer screen pixels for anyone looking at it.

[st7860]

http://www.benefitscanada.com/investment...l-keep-toronto-real-estate-vibrant-67195
Canada is the Switzerland for educated affluent foreigners looking for a stable country they can call home, added Mizrahi, whose company is currently building the largest condo in Toronto at one of the city’s most coveted locations, the southwest Bloor-Yonge corner.

Canada currently accepts 250,000 permanent residents every year, about a quarter of whom end up in Toronto.

“Many cities would scream for the kind of growth we have in Toronto,” said Jennifer Keesmaat, chief planner at the City of Toronto, speaking at the same event.

[lio45]

Originally Posted by st7860

I do not care if someone buys a house and leaves it empty while paying taxes to the city lol

In fact, you should.

If that house is occupied by a Vancouver family, not only will they ALSO obviously be paying their property taxes to the city, but in addition to that they'll also live in Vancouver, earn in Vancouver, spend in Vancouver.

If that house is instead empty, while the insane rise in prices drives more and more families out of Vancouver, it's not really a gain for anyone except people who make money on these transactions. Now, yes, that's still a lot of people -- but it's not like there's no downside, like you seem to say.

[someone123]

Originally Posted by lio45

If that house is instead empty, while the insane rise in prices drives more and more families out of Vancouver, it's not really a gain for anyone except people who make money on these transactions. Now, yes, that's still a lot of people -- but it's not like there's no downside, like you seem to say.

BC's premier suggested that this is merely a kind of zero-sum trade-off, where some people are better off because their house values went up, and others are worse off by the same amount because they can't buy, so it's all just a wash and nothing can or should be done.

I guess I'm preaching to the choir here, but for older people we are talking about free windfall returns they never expected and for younger locals the consequence is not being able to afford anything more than a small apartment, ever, unless something changes.

It's also a big problem for businesses trying to attract talent. They can't afford to pay a $40k/year salary premium so that employees can afford housing comparable to what they'd be able to get in other Canadian cities. Because of this, they just don't get as much talent and they tend not to grow as much.

[st7860]

Originally Posted by lio45

In fact, you should.

If that house is occupied by a Vancouver family, not only will they ALSO obviously be paying their property taxes to the city, but in addition to that they'll also live in Vancouver, earn in Vancouver, spend in Vancouver.

If that house is instead empty, while the insane rise in prices drives more and more families out of Vancouver, it's not really a gain for anyone except people who make money on these transactions. Now, yes, that's still a lot of people -- but it's not like there's no downside, like you seem to say.

Basically you would prefer the Federal Government make more than the Municipal Government.

There are plenty of places for families in Vancouver if you look around.

[st7860]

Originally Posted by someone123

BC's premier suggested that this is merely a kind of zero-sum trade-off, where some people are better off because their house values went up, and others are worse off by the same amount because they can't buy, so it's all just a wash and nothing can or should be done.

I guess I'm preaching to the choir here, but for older people we are talking about free windfall returns they never expected and for younger locals the consequence is not being able to afford anything more than a small apartment, ever, unless something changes.

It's also a big problem for businesses trying to attract talent. They can't afford to pay a $40k/year salary premium so that employees can afford housing comparable to what they'd be able to get in other Canadian cities. Because of this, they just don't get as much talent and they tend not to grow as much.

Many or most of those seniors enjoying a windfall are likely Canadians in every sense of the word as well.

[sunsetmountainland]

Originally Posted by someone123

BC's premier suggested that this is merely a kind of zero-sum trade-off, where some people are better off because their house values went up, and others are worse off by the same amount because they can't buy, so it's all just a wash and nothing can or should be done.

I guess I'm preaching to the choir here, but for older people we are talking about free windfall returns they never expected and for younger locals the consequence is not being able to afford anything more than a small apartment, ever, unless something changes.

It's also a big problem for businesses trying to attract talent. They can't afford to pay a $40k/year salary premium so that employees can afford housing comparable to what they'd be able to get in other Canadian cities. Because of this, they just don't get as much talent and they tend not to grow as much.

Since I would be classified as a older person. I would suggest your free windfall on returns idea is more of a mute point. Since as a younger person I planned to make more money as an older person. I did not see myself as a younger person able to afford a house in Vancouver so I bought in Nanaimo.
I purchased while the market was low.
I worked hard as well as used equity to purchase in Vancouver. If you are young you should not be expected to get things handed to you.
I will also note that some of the older persons will pass on there fortune to their young.

As for business like the high tech industry or film industry they seem to be doing very well in Vancouver.

Also in North Vancouver the manufacturing industry will be thriving with Seaspans building coast guard ships.


http://globalnews.ca/video/1999905/t...tro-vancouver/

Also the conference board of Canada has suggested Toronto Vancouver and Halifax will record the fastest growth in Canada this year

http://www.conferenceboard.ca/press/news...conomic_fortune_for_canadian_cities.aspx

[lio45]

Originally Posted by someone123

I guess I'm preaching to the choir here, but...

If I may be a little rude to some... the way I see it, you're preaching to a mix of choir and stones.

It's also a big problem for businesses trying to attract talent. They can't afford to pay a $40k/year salary premium so that employees can afford housing comparable to what they'd be able to get in other Canadian cities. Because of this, they just don't get as much talent and they tend not to grow as much.

I have a few examples within my circles of family/friends of people who "fled" the West Coast because the wages-to-property-prices ratios were just horrible...

I think I said it on this board already but not too long ago (around last fall, IIRC) one of my close friends came back to Montreal when his postdoc came up for renewal in California. By his own admission, he would've liked to stay there, but financially, it made zero sense. He's now making about as much but in Montreal, where the same money goes really further.

Apparently you're supposed to accept to have a hard time making ends meet and/or live in a crappy, tiny apartment as the trade-off for... a generally nicer climate, the Pacific and some mountains nearby...?

Sorry, I'll pass. You guys are lucky that many still accept this -- I don't expect it to last forever. Things don't tend to stay undervalued or overvalued forever.

[st7860]

I expect things to last as its been known for a long time that here isn't a place to have a huge salary. Money isn't everything you know.

An hour away from Vancouver homes are half the price. - "14629 60TH AV, Sullivan Station, Surrey, $529,900.00 8 year old 2148 ft"

Yes, you got things right. The climate, ocean, mountains, and recreation is a large draw for people.


Where else can you get a view like this yet live close to amenities?

[lio45]

Originally Posted by st7860

Money isn't everything you know.

Yes, but it helps.

In the case of my friend the big nail in the coffin was the realization that with the California position, owning a house on that salary would come at a cost of a 1h+ commute every morning and evening. He didn't want to accept that.

FYI, you don't choose a career path into academia like he did if you're a "money is everything" type.

[lio45]

Originally Posted by st7860

An hour away from Vancouver homes are half the price.

You added that part to your post while I was typing mine... interesting that we both were speaking of the same thing without knowing it. (Accepting to settle for being "an hour away", or not.)