Canada's 'housing bubble' deemed close to bursting

[cornholio]

Sometimes I wonder if this is why China has always had issues, culturally their populace has always kept collapsing their markets throughout their history, and when I say collapse I don't mean healthy cyclical and sustainable economic activity that keeps rebounding. The behavior is ultimately destructive and will lead to eventual system collapse and stagnation. Modern economics has recently focused on bacterial growth to predict and understand our own economic growth, as there seem to be some striking similarities (believe it or not). I mean this stuff is still very raw and I doubt its very useful at this point http://www.bbc.com/news/science-environment-23623601 . Different cultures different bacteria. Crazy stuff I guess. Not even sure what my point is anymore beyond thinking of explanations such as we let our selves be infected and the end will not be a made in Canada one but a made in China one, and made in China ends have for a very long time been . And China since the early days of Confucianism has always created massive boom and bust cycles followed by long periods of stagnation as a result of what I would describe as OCD type behavior on societal level. I hope their not about to repeat the same and this time take us all with them.

Its no longer a healthy market in Vancouver or Toronto or London or Sydney or Melbourne and we will all pay for it. Unhealthy economic practices that lead to collapse are not good for anyone. There are no winners if you cant easily rebound out of it.

[ssiguy]

Again, notice the source?................The South China Morning Post. You would never get this kind of investigation from any of the local news media whether that's print or TV. Hell the local Global news has a Re Max sign in the corner.

The province and city have sacrificed the citizens for the all mighty dollar and even a recent UBC prof {I'll look yp his name as I can't recall it} said that Vancouver has become the new Cayman Islands................park your money, no questions asked.

This is not only hurting the current citizens but puts the entire city's future at risk. The current boomers who have made a fortune are cashing out and moving to the Island and the young are fleeing then entire area and many who want to come aren't as people all across the country know of Vancouver's extreme housing situation.

Even local businesses are sounding the alarm as they cannot entice skilled workers or even keep the current ones as they cannot possibly pay enough to compensate for the cost of living. Even UBC and SFU amongst others are worried and they UBC now offers subsidized housing on campus because the profs wages are not high enough to entice people with a PH'D. When the boomer profs begin to retire within the next 10 years UBC may actually have to close classes or even entire programs as getting profs under 30 will be near impossible.

With a profs or highly skilled workers salary of 120k they can {for now} afford a condo but people don't go to university for 5 to 7 years so they have the luxury of living in a shoe box.

For those who bought even 15 years ago and are over 40 then they have seen real gains but the future of a city's economic and social vitality do not rely on those over 40 but rather those currently under 30 and for them Vancouver offers no options.

[ssiguy]

Do you want to hear something really sad? ............I was talking to my financial consultant about my pension about a month ago.

Both he and his wife work full time in White Rock but live in Langley as the area is out of the question {my brother's 3 bedroom rancher with no basement and 30 years old just sold for $1.67 million to a Chinese investor who has already said he has no intention of living there}. They have 3 kids in their teens and they have saved enough for their education. He said sadly {as I could tell by his voice and expression} that he has told them that the money is there but on one proviso...........that they leave the Lower Mainland.

He and his wife know that if they stick around the area for post secondary and meet new friends and a potential partner that they are more likely to stay. He know that they have no financial future in Greater Vancouver with low paying employment and housing that will never be within reach. He wants them to make new friends and maybe a partner and get job training and connections in a place where they have a real future for themselves and if they have kids.

It's very sad when your parents don't want you to live far away but know that living away is their only option and your financial future and standard of living depend on it.

This is the kind of city that our politicians ,both municipal and provincial, have created where the citizens are considered 'collateral damage' in the rush for money and the bribes our politicians accept, and the city itself has become nothing more than a commodity.

[whatnext]

@ssiguy the UBC example is a good one. The West Side of Vancouver is closest neighbourhood to three major employment centers: UBC, YVR airport and downtown, yet local workers even the upper middle class are now priced out of it. Why, because the locusts like that it's close to the university so they can stash theit kids in a house there and it's close to the airport when they jet back to their job in China. Why else is a relatively small burg like Vancouver so well served by flights to China?

[lio45]

Originally Posted by whatnext

Look out Montreal, the real estate locusts are coming for you! Having picked Vancouver and Toronto clean of affordable housing and jacking up prices:

http://www.cjad.com/cjad-news-community/...ors-from-china-snapping-up-condos-report

I saw that as well in the paper... (the very article they're referencing.)

Some of the new condo towers were up to 86% Chinese-bought, apparently.

Normally what happens in Montreal tends to spill over to Sherbrooke to a degree (especially in the case of investors pushed away by falling Mtl cap rates) so I'm finding it awesome that we're finally starting to be showing on the Chinese's radar.

[csbvan]

Originally Posted by lio45

I saw that as well in the paper... (the very article they're referencing.)

Some of the new condo towers were up to 86% Chinese-bought, apparently.

Normally what happens in Montreal tends to spill over to Sherbrooke to a degree (especially in the case of investors pushed away by falling Mtl cap rates) so I'm finding it awesome that we're finally starting to be showing on the Chinese's radar.

Hardly surprising. First it was Vancouver, then Toronto...why wouldn't the affordability crisis not hit Montreal next? It's not as though the governments at any level in Canada have attempted to slow this process down.

[casper]

Originally Posted by ssiguy

....
This is not only hurting the current citizens but puts the entire city's future at risk. The current boomers who have made a fortune are cashing out and moving to the Island and the young are fleeing then entire area and many who want to come aren't as people all across the country know of Vancouver's extreme housing situation.

.....

Even local businesses are sounding the alarm as they cannot entice skilled workers or even keep the current ones as they cannot possibly pay enough to compensate for the cost of living. Even UBC and SFU amongst others are worried and they UBC now offers subsidized housing on campus because the profs wages are not high enough to entice people with a PH'D. When the boomer profs begin to retire within the next 10 years UBC may actually have to close classes or even entire programs as getting profs under 30 will be near impossible.

With a profs or highly skilled workers salary of 120k they can {for now} afford a condo but people don't go to university for 5 to 7 years so they have the luxury of living in a shoe box.

It is hard to find a place in Victoria now. Many single family homes sell in bidding wars and with no conditions on the offer. It is quite different from when I moved here.

As for UBC that is a problem they have had for many years. There location is one that is surrounded by some of the most expensive property in Vancouver. They were doing subsidized housing 10 years ago and likely even long before that.

In Victoria, I know many of the tech companies are having a hard time finding spilled staff. I think this is going to cause a boom on the Island. It is a positive from that perspective.

[eternallyme]

Originally Posted by casper

It is hard to find a place in Victoria now. Many single family homes sell in bidding wars and with no conditions on the offer. It is quite different from when I moved here.

As for UBC that is a problem they have had for many years. There location is one that is surrounded by some of the most expensive property in Vancouver. They were doing subsidized housing 10 years ago and likely even long before that.

In Victoria, I know many of the tech companies are having a hard time finding spilled staff. I think this is going to cause a boom on the Island. It is a positive from that perspective.

I think if the market could set tuition rates, UBC would have the highest tuition in North America easily - probably over $60,000 a year.

How far out from Vancouver would you have to live in order to find housing near the Canadian average? 3 hours? 4 hours?

[casper]

Originally Posted by eternallyme

I think if the market could set tuition rates, UBC would have the highest tuition in North America easily - probably over $60,000 a year.

How far out from Vancouver would you have to live in order to find housing near the Canadian average? 3 hours? 4 hours?

Average house price in Canada is half-million.
http://www.canadiangrocer.com/top-stories/cokes-namesake-sodas-see-declines-in-key-markets-64203

I have not been looking. Others can probably tell you where one can find property for that value.

[Berklon]

Originally Posted by casper

Average house price in Canada is half-million.
http://www.canadiangrocer.com/top-stories/cokes-namesake-sodas-see-declines-in-key-markets-64203

I have not been looking. Others can probably tell you where one can find property for that value.

I'm assuming you've pasted the wrong link?

[giallo]

You can buy a newly-built house for $500,000 in between Abbotsford and Chilliwack (around an hour and a half outside of Vancouver proper).

[ssiguy]

Another consequence of Vancouver's sky high prices is that it makes urban planning very difficult. Vancouver and imperial wizards like Gordon Price tell the proletariats that they should live near where they work. What an insulting suggestion.

Is UBC, SFU, the community colleges, province, or feds going to triple their wages so people can live in the city.................I'm not holding my breath.

This, backed up with Vancouver's poor transportation infrastructure, is why the city has the 2nd longest commute in NA behind only L.A. yet doesn't even crack the top 20 in population on the continent.

[GreaterMontréal]

the median resale value of single family homes in Quebec is $233,000, Montréal $295,000

[csbvan]

Originally Posted by ssiguy

Another consequence of Vancouver's sky high prices is that it makes urban planning very difficult. Vancouver and imperial wizards like Gordon Price tell the proletariats that they should live near where they work. What an insulting suggestion.

Is UBC, SFU, the community colleges, province, or feds going to triple their wages so people can live in the city.................I'm not holding my breath.

This, backed up with Vancouver's poor transportation infrastructure, is why the city has the 2nd longest commute in NA behind only L.A. yet doesn't even crack the top 20 in population on the continent.

2nd longest commutes? Don't tell me you're referring to the endlessly discredited TomTom report. Also Vancouver has excellent transit for a city its size by North American standards. As in one of the best. Most Canadian cities do fairly well for their size when it comes to transit.

[casper]

Originally Posted by Berklon

I'm assuming you've pasted the wrong link?

Yes, that was the wrong link. This is the correct one: http://www.cbc.ca/news/business/house-prices-february-1.3491831

[casper]

Originally Posted by ssiguy

Another consequence of Vancouver's sky high prices is that it makes urban planning very difficult. Vancouver and imperial wizards like Gordon Price tell the proletariats that they should live near where they work. What an insulting suggestion.

Is UBC, SFU, the community colleges, province, or feds going to triple their wages so people can live in the city.................I'm not holding my breath.

This, backed up with Vancouver's poor transportation infrastructure, is why the city has the 2nd longest commute in NA behind only L.A. yet doesn't even crack the top 20 in population on the continent.

What UBC is doing is building housing that they rent out to their staff.

I would not be surprised in the long-term to see UBC and SFU who have large tracks of undeveloped land setup their own non-profit housing authorities that build family friendly housing that are leased out to employees. The reason for the high cost in housing is not the cost of the building or its maintenance it is the cost of land.

[kwoldtimer]

Originally Posted by GreaterMontréal

the median resale value of single family homes in Quebec is $233,000, Montréal $295,000

The market in K-W has perked up this year after a fairly quiet 2015. The median for SFH is about $355,000.

If anyone is interested, I've always loved this 1880s beauty that's just come on the market - completely restored/renovated (won a heritage award), five bedrooms, 2.5 bathrooms, 3200 sq ft on 50X119ft lot in Downtown Kitchener. Asking $699,000! If I weren't moving to Ottawa, I'd be seriously considering it, although it's much more house than I need.

[mistercorporate]

Originally Posted by kwoldtimer

The market in K-W has perked up this year after a fairly quiet 2015. The median for SFH is about $355,000.

If anyone is interested, I've always loved this 1880s beauty that's just come on the market - completely restored/renovated (won a heritage award), five bedrooms, 2.5 bathrooms, 3200 sq ft on 50X119ft lot in Downtown Kitchener. Asking $699,000! If I weren't moving to Ottawa, I'd be seriously considering it, although it's much more house than I need.

Thats a stunner of a home. But in all honesty i would never buy a house on less than one acre of a lot, it just seems tragic to see such a classic building in cookie cutter suburbia. Either a beautiful legacy acreage or cheap condo/townhome.

[urbandreamer]

The Chinese investors have discovered Hamilton. Just as Toronto's creative class flees Toronto for cheaper apartments and homes in the Hammer.

[kwoldtimer]

Originally Posted by mistercorporate

Thats a stunner of a home. But in all honesty i would never buy a house on less than one acre of a lot, it just seems tragic to see such a classic building in cookie cutter suburbia. Either a beautiful legacy acreage or cheap condo/townhome.

An acre residential lot in Downtown Kitchener would be a rarity. It is a bit to close to the big (also beautiful) craftsman beside it, but the stretch that this house is on is miles from "cookie cutter suburbia". The area is full of century homes, many now renovated. There were also many of the mansions of local old money, although most of them have long since been torn down (!) to make way for the Civic District, among other things. Actually, when I think of the homes across the street (long gone and the land still empty), they would probably have been on lots of an acres or more.

I guess what surprises me most is the asking price of $699,000. Unless there is a big problem with the structure, that seems very, very low for that house, at least to me. You could easily pay more for a large house with far less character out in what are indeed the "cookie cutter suburbs" of K-W.