Canada's 'housing bubble' deemed close to bursting

[ssiguy]

News story from Vancouver that a real estate agent is going to Shanghai to sell Vancouver real estate and not even bother marketing them in Vancouver. He knows, as well as everyone else, that homes are no longer viable for even the wealthy in Vancouver and only the Chinese money launderers can afford a house in the city.

What a sad and pathetic state of affairs when even real estate agents write-off the locals as potential buyers in their own city.

[geotag277]

Originally Posted by WhipperSnapper

Tiny in Calgary?!? Where do you think all the developers are from in Calgary? Where do you think they get the hundreds of millions to have multiple projects on the go in numerous cities and for each one they grossly overpaid? Who is dominating the national rental market right now? You think this about some end users. There's nothing shocking or to be proudful about all the development in Calgary during 35 dollar oil. Back to end user, what may shock you are the dozens of rental listings that come up when those "sold out in a day" Calgary buildings get their occupancy permits.

It's far from being just Chinese as well.

I'm sorry, I thought we were talking about the domestic mortgage sales industry. I'm not sure what the actual developer origins have to do with anything, where they are getting funded, or what rental suites have to do with the discussion.

Bottom line, Canadian domestic mortgage legislation should be protecting Canadians from over-leveraging themselves and by extension, the domestic banking industry. Any talk regarding foreign investment is a wholly separate conversation, which is my only point here.

[giallo]

Originally Posted by ssiguy

News story from Vancouver that a real estate agent is going to Shanghai to sell Vancouver real estate and not even bother marketing them in Vancouver. He knows, as well as everyone else, that homes are no longer viable for even the wealthy in Vancouver and only the Chinese money launderers can afford a house in the city.

What a sad and pathetic state of affairs when even real estate agents write-off the locals as potential buyers in their own city.

I have a lot of friends in real estate in Vancouver, and they sell to locals frequently.

Typical, weekly hyperbolic post from ssiguy.

[geotag277]

Originally Posted by giallo

I have a lot of friends in real estate in Vancouver, and they sell to locals frequently.

Typical, weekly hyperbolic post from ssiguy.

Reminds me of that article whatnext posted recently, in which he was indignant that a foreign investor was willing to pay 500k over list price for a property, yet in the article itself it mentioned a local buyer was involved in the bidding war and was willing to spend 200k over list price. Of course that piece of information was never mentioned by whatnext.

[Danny D Oh]

Do the foreign investors mortgage their purchases through Canadian banks?

Does the CMHC back their mortgages?

[whatnext]

Originally Posted by giallo

I have a lot of friends in real estate in Vancouver, and they sell to locals frequently.

Typical, weekly hyperbolic post from ssiguy.

No offense, but given that you're posting from Shanghai you;re not exactly unbiased are you. Can't bite the hand etc...

Ask your realtor friends what kind of property they're selling to locals and where.

[whatnext]

Originally Posted by flar

This new rule will protect a few people from buying a home they can't afford. But won't it just make things easier for foreign buyers with lots of cash? That will have the consequence of making it even harder for younger people to get into the housing market.

Exactly. While well intentioned, all this change does is knock more locals out of the market while doing nothing to stem price inflation caused by offshore buyers.

[giallo]

Originally Posted by whatnext

No offense, but given that you're posting from Shanghai you;re not exactly unbiased are you. Can't bite the hand etc...

Ask your realtor friends what kind of property they're selling to locals and where.

West Van (houses), Burnaby/New West (condos and houses), and downtown (condos).

Not sure what living in Shanghai has to do with anything. I'm not a Chinese national, nor do I feel any need to defend Chinese buyers. Not my world.

For what it's worth, I've never seen any ads selling Vancouver real estate out here. I see tons of ads from agencies offering services to Canadian citizenship, but that's about it.


sidenote: I'm not claiming there aren't Chinese buyers in Vancouver. Of course there are. My previous comment was based on ssiguy's overly-dramatic and obviously false statement.

[Stryker]

Originally Posted by giallo

Not sure what living in Shanghai has to do with anything. I'm not a Chinese national, nor do I feel any need to defend Chinese buyers. Not my world.

My point is more than a few reasons you might be biased to seeing as so apparent.

If you compare vancouver prices etc to east asia things are not that extreme in value, the point is that this is a common mistake people make about van.

The rest of the contitent have unlimited room to grow, which is something you don't see in asia.

Regardless the point isn't that 100 percent of buyers in vancouver are chinese.


The point is that foreign buyers are more actively involved in the more direct speculative nature of the market.

When you have the excess cash(corruption money) it's very easy to overpay for things and in the process reenforce a bubble.

[ssiguy]

For the "local" buyers of homes in Vancouver, local also means ex-Chinese who now live here.

[geotag277]

Average real estate prices in Sherbrooke are up 62% year over year?

http://www.cbc.ca/news/business/crea-housing-november-1.3365671

In other news, Lio is officially retired.

[lio45]

Originally Posted by geotag277

Average real estate prices in Sherbrooke are up 62% year over year?

http://www.cbc.ca/news/business/crea-housing-november-1.3365671

In other news, Lio is officially retired.

LOL, that has to be a typo. Prices have already been quite high for a few years now, I'd even say unreasonably high (looking at the cap rates) for at least a couple years, no way the average building has jumped +62% over its already super-inflated 2014 level. I keep my finger on the pulse of the Sherbrooke market, I can tell you asking prices are definitely high now (by my own cap rate standards) but not really much more than of late (the last couple years).

Or else, it's just an accident of the data -- a few major high-end condo projects came online since last year, so yes, maybe the average transaction price did jump +62%, but that's totally different from seeing real estate in general rise +62%.

Real estate values could very well be totally flat, and the average transaction price could still be up +62% due to the luxurious nature of most of the properties that just got added to the market.

[sunsetmountainland]

Originally Posted by ssiguy

For the "local" buyers of homes in Vancouver, local also means ex-Chinese who now live here.

Now since we all know you do not like Chinese! Yes local means Hong Kong and mainland China expats! Tons whom have been living in Vancouver before you moved here or were born!

[sunsetmountainland]

Originally Posted by Stryker

My point is more than a few reasons you might be biased to seeing as so apparent.

If you compare vancouver prices etc to east asia things are not that extreme in value, the point is that this is a common mistake people make about van.

The rest of the contitent have unlimited room to grow, which is something you don't see in asia.

Regardless the point isn't that 100 percent of buyers in vancouver are chinese.


The point is that foreign buyers are more actively involved in the more direct speculative nature of the market.

When you have the excess cash(corruption money) it's very easy to overpay for things and in the process reenforce a bubble.

Speculative is your word! Your last sentence is speculative.

The nature of the Vancouver market is supply vs demand! It always has been always will be. Vancouver has limited geography it is not like most North American cities that can sprawl forever.

It will always go up! This bubble you are waiting for is not going to happen. When the market goes down people put there money in Vancouver real estate when the market goes up more people put there money in Vancouver real estate because the economy is good.

Like I told Leo, he could make some money but he declined to invest in Vancouver because of fear?

[Procrastinational]

Originally Posted by sunsetmountainland

It will always go up! This bubble you are waiting for is not going to happen.

Bubble? What bubble?

It's different this time.

It's supply and demand.

No... Probably not...


http://www.adrianspitters.com/familywealthadvisor/time-different-housing-bubble/

If it walks like a duck, swims like a duck, and quacks like a duck, it's probably a duck.

[geotag277]

Comparing single family detached houses in Vancouver to the entire USA housing market just makes you look ridiculous. Why not compare apples to apples, such as Vancouver single family detached housing with something like San Francisco inner city single family detached housing? You might as well compare Vancouver housing with Amazon stock, which is currently worth 7x as much as it was at the peak of the tech bubble, or Apple, which is worth more than 10x as much. Cherry picking examples and all.

[whatnext]

Originally Posted by geotag277

Reminds me of that article whatnext posted recently, in which he was indignant that a foreign investor was willing to pay 500k over list price for a property, yet in the article itself it mentioned a local buyer was involved in the bidding war and was willing to spend 200k over list price. Of course that piece of information was never mentioned by whatnext.

Your point being...? The local didn't get it as the offshore money will almost always have deeper pockets. You seem to invest an awful lot of time in trying to refute facts about offshore owners. What's your skin in the game?

[sunsetmountainland]

Originally Posted by Procrastinational

Bubble? What bubble?

It's different this time.

It's supply and demand.

No... Probably not...


http://www.adrianspitters.com/familywealthadvisor/time-different-housing-bubble/

If it walks like a duck, swims like a duck, and quacks like a duck, it's probably a duck.

Outside of what geotag277 has already posted! The article you are using is, well from march 24th 2012! Now Adrian Spitters from Assante weath management in Abbotsford. He has a good farming background. From his website

Having gone through a poorly executed farm transition experience with my father’s estate, 17 years ago, I know all too well the result of not having a proper transition plan in place. In my family it led to family discord due to unequal treatment among family members and the bankruptcy of my brother who inherited the farm.

Today, I work as a Senior Wealth Advisor with Assante Capital Management Ltd., a leading Canadian Wealth Management firm with extensive experience in family farm and business transition. From my office in Abbotsford British Columbia, I work with business and farm families in the surrounding communities of Langley, Aldergrove, Mission, Chilliwack, Surrey and White Rock. In my work with Assante, I provide wealth advisory services to family enterprises. This includes helping them grow, protect and preserve their family assets, wealth and legacy.

http://www.assante.com/advisors/aspitters/
The only thing in your whole post that made sense was

If it walks like a duck, swims like a duck, and quacks like a duck, it's probably a duck.

Unfortunately for you that last sentence does not say much for your debate!

Now lets look at the year 2015 perhaps read an article from Laurence D. Fink, head of the world’s biggest asset manager.

Gold’s traditional role as a store of wealth has been usurped by contemporary art and apartments in cities such as New York and London, according to Laurence D. Fink, head of the world’s biggest asset manager.

“The two greatest stores of wealth internationally today is contemporary art….. and I don’t mean that as a joke, I mean that as a serious asset class,” said Fink. “And two, the other store of wealth today is apartments in Manhattan, apartments in Vancouver, in London.”

http://www.bloomberg.com/news/articles/2...t-top-gold-as-stores-of-wealth-says-fink

[sunsetmountainland]

Originally Posted by whatnext

Your point being...? The local didn't get it as the offshore money will almost always have deeper pockets. You seem to invest an awful lot of time in trying to refute facts about offshore owners. What's your skin in the game?

Now read the post above first. Take a deep breath and relax. Off shore investors are not always going to have deeper pockets, how do you know?

Do you have facts to back up your statement? I would like to hear them? Now what do you have against offshore owners? What's your skin in the game?

[lio45]

Originally Posted by sunsetmountainland

Off shore investors are not always going to have deeper pockets, how do you know?

Basic statistics.

If I'm selling something very sought after at auction and the auction is restricted to the people of my hometown, the price it'll end up reaching is likely (on average, averaged over a large number of such auctions) significantly lower than the price it would have reached had the auction been open to all citizens of this province, which is likely significantly lower than the price it would have reached had the auction been open to all citizens of this country, which is significantly lower than the price it would have reached had the auction been open to everyone in the world.

So yes, on average, if something's restricted to locals, it'll fetch a statistically lower price.