Canada's 'housing bubble' deemed close to bursting

[geotag277]

Originally Posted by MonctonRad

I just finished reading an article in the NY Times about China trying to re-establish a "silk road" trading corridor overland to Europe via rail through Kazakhstan and was taken by this ancient Kazakh proverb quoted in the article about some Kazakh discomfort with the Chinese ambitions. I though the quote germane to the discussion here regarding Chinese influence on the Vancouver housing market:

That's an interesting quote from Kazakhstan. I wonder how ancient it really is?

They have another one too, this one even more absurd:

"To be the captive of the Chinese is a tight noose — with the Russians, it is a wide, open road."

http://www.eurasianet.org/node/79336

Russia has been meddling in Kazakhstan for centuries. It seems highly unlike these "ancient" quotes were organically disseminated within Kazakhstan, especially in light of repeated propaganda, strategic importance, and modern "cold wars".

Interesting how Kazakhstan prefers Russia even after things like this.

What has China ever done to Kazakhstan?

[Pinion]

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[casper]

Originally Posted by Pinion

Sweet deal on a four bedroom 700 sq foot income property for well under average price:



Not a bubble, folks.

Oh, it is cute, in a trailer park sort of way.

[GreaterMontréal]

how in the world , why did you let that happen

[lio45]

Seems kind of low for a Vancouver property with a standard-sized lot; must be in an awfully bad neighborhood. Anyway, the house is irrelevant. That exact house on a $3 million piece of land would be worth $3 million, just like Pinion's dad's old house.

[Doady]

If you want to buy a 700sqft single family detached house in Manhattan it would probably cost over $1.3 million as well. I don't understand what that example is supposed to prove.

[Skygazer]

Originally Posted by Doady

If you want to buy a 700sqft single family detached house in Manhattan it would probably cost over $1.3 million as well. I don't understand what that example is supposed to prove.

Vancouver isn't Manhattan. Or San Francisco, London, Paris, Tokyo, or any other big global cities with these kinds of prices that people often compare it to. It's a perfectly nice city but it's not even remotely in the same league as these other ones on any level (population/size, amenities, economy, arts/culture, history, etc) and there's no logical reason for it to have such a crazy housing market and especially for the prices to have gone up so sharply so suddenly in the past few years.

[whatnext]

Originally Posted by Doady

If you want to buy a 700sqft single family detached house in Manhattan it would probably cost over $1.3 million as well. I don't understand what that example is supposed to prove.

What does that prove, other than that you apparently have never been to Manhattan?

[geotag277]

Originally Posted by Skygazer

Vancouver isn't Manhattan. Or San Francisco, London, Paris, Tokyo, or any other big global cities with these kinds of prices that people often compare it to. It's a perfectly nice city but it's not even remotely in the same league as these other ones on any level (population/size, amenities, economy, arts/culture, history, etc) and there's no logical reason for it to have such a crazy housing market and especially for the prices to have gone up so sharply so suddenly in the past few years.

Calgary isn't Manhattan, San Francisco, London, Paris, or Tokyo either, and see my example here:

http://www.skyscraperpage.com/forum/showpost.php?p=8027279&postcount=7811

The fact is every city has land which is expensive, especially cities over 2 million. Vancouver used to be a Canadian leader in urban development, now they are the city of screaming NIMBYs blocking multi-family development. Any land worth over one million outside of maybe West Vancouver and Point Grey should have been rezoned and redeveloped. that process should have started decades ago.

Amazing how far Vancouver used to be ahead on multifamily, and now places like Calgary are putting it to shame.

[Doady]

Originally Posted by Skygazer

Vancouver isn't Manhattan. Or San Francisco, London, Paris, Tokyo, or any other big global cities with these kinds of prices that people often compare it to. It's a perfectly nice city but it's not even remotely in the same league as these other ones on any level (population/size, amenities, economy, arts/culture, history, etc) and there's no logical reason for it to have such a crazy housing market and especially for the prices to have gone up so sharply so suddenly in the past few years.

There is no way you can say no house anywhere in Vancouver area should be worth as much as a similar size house anywhere in New York, London, Paris, Tokyo area. You can't say $1.35 million is too much unless you know that exact location. Same with Toronto, Montreal, or any other city. That's why there is such thing as bid-rent curve.

Every city has expensive land and cheap land. The problem is not the expensive land, but the lack of cheap land. That example posted by casper doesn't say anything.

If people want to buy a single family detached house in a central city in metropolitan area of 2+ million people, possibly beside subway or elevated rail, then they can reasonably expect it to be cheap like some new fringe subdivision? Give me a break.

It was an example of a house in the suburbs like Surrey or Langley or something, it might be more convincing. To buy any size detached house in a central city is not an affordable option in many large metropolitan areas, unless it's Detroit or something like that.

[240glt]

To buy any size detached house in a central city is not an affordable option in many large metropolitan areas, unless it's Detroit or something like that.

All depends on the amount of land available.

Edmonton has large swaths of vacant land in & around its core. The cheapest single family houses in the city are right next to downtown

[Skygazer]

Originally Posted by Doady

There is no way you can say no house anywhere in Vancouver area should be worth as much as a similar size house anywhere in New York, London, Paris, Tokyo area. You can't say $1.35 million is too much unless you know that exact location. Same with Toronto, Montreal, or any other city. That's why there is such thing as bid-rent curve.

Every city has expensive land and cheap land. The problem is not the expensive land, but the lack of cheap land. That example posted by casper doesn't say anything.

If people want to buy a single family detached house in a central city in metropolitan area of 2+ million people, possibly beside subway or elevated rail, then they can reasonably expect it to be cheap like some new fringe subdivision? Give me a break.

It was an example of a house in the suburbs like Surrey or Langley or something, it might be more convincing. To buy any size detached house in a central city is not an affordable option in many large metropolitan areas, unless it's Detroit or something like that.

I never said nor implied that "no house anywhere in the Vancouver area" should ever be as expensive as one in a major global city, nor that a detached house near the core of a major metro area should be "cheap".

What I did say, and will continue to say, is that Vancouver is not a major global city on par with NYC, SF, London, Paris, etc. and people should not be referring to the prices in those places when trying to argue that things aren't completely out of whack in Vancouver, because they're in two completely different leagues.

[ssiguy]

Vancouver's prices have little to do with available land and everything to do with Chinese money and the different cities willing to bend over backwards to try to get their piece of the pie. All Vancouver and area had to do to keep the real estate at bay for decades was to disallow any housing destruction without replacements being of higher density..........all of a sudden the people who buy these homes would actually have to live in them and the shack you see above would be selling for less than half the current price.

Vancouver has gone out of it's way to make housing as expensive as humanely possible to keep the Chinese money flowing and the needs of the people who actually live here has always been considered completely irrelevant.

[mistercorporate]

Originally Posted by Doady

If you want to buy a 700sqft single family detached house in Manhattan it would probably cost over $1.3 million as well. I don't understand what that example is supposed to prove.

A detached house in Manhattan?? Try more like $13-130 million depending on the intersection, lol..

[whatnext]

From today's Financial Post:

Foreigners are banned from buying property in New Zealand — Canada should do the same
Diane Francis: Canada must close loopholes, end secrecy, and ban foreign ownership of real estate

As of January 1, foreigners are banned from buying property in New Zealand because of soaring real estate prices. Canada should have done the same years ago.

But Canadian governments remain clueless. Last month, the Canada Mortgage and Housing Corporation claimed misleadingly that “non-residents” own a small portion of housing – a mere 3.4 percent in Toronto and 4.8 percent in Vancouver.

That statement underscores the incompetence of the country and its principal lender...

..This flood of hidden dirty money from offshore is widespread so how can a federal government agency state that foreign ownership is minuscule? Worse, how many billions has the CMHC loaned to “owners” hiding behind fronts that are not entitled to mortgages subsidized by Canadian taxpayers?

Secrecy facilitates money laundering and has contributed mostly to excessive real estate prices and the fact that Canadian consumer debt is the highest in the world, representing a grave economic risk.

Canada is a hot money haven because cash deposits or questionable wire transfers — that cannot be deposited into banks without verifying the source of funds – flow through real estate brokers, developers, and law firms then are deposited into banks for payment.

An example surfaced last May, after a prolonged probe by the Law Society of British Columbia, when a West Vancouver lawyer was found guilty of professional misconduct for allowing $26 million from unknown sources to flow through his trust account even though he did no legal work to earn the money...

http://business.financialpost.com/person...in-new-zealand-canada-should-do-the-same

[rbt]

Originally Posted by whatnext

..This flood of hidden dirty money from offshore is widespread so how can a federal government agency state that foreign ownership is minuscule? Worse, how many billions has the CMHC loaned to “owners” hiding behind fronts that are not entitled to mortgages subsidized by Canadian taxpayers?

If the federal government couldn't track it for the statistics, how do they expect the federal government to prevent it?

The feds have said the %age of purchases they can prevent via enforcement (the ones they know about).

[LeftCoaster]

Originally Posted by geotag277

The fact is every city has land which is expensive, especially cities over 2 million. Vancouver used to be a Canadian leader in urban development, now they are the city of screaming NIMBYs blocking multi-family development. Any land worth over one million outside of maybe West Vancouver and Point Grey should have been rezoned and redeveloped. that process should have started decades ago.

Amazing how far Vancouver used to be ahead on multifamily, and now places like Calgary are putting it to shame.

Calgary is putting Vancouver to shame on Multifamily?

I only have the Dec 2015 stats since that is all that's available for free on CMHC but Vancouver had 21,131 multifamily dwellings U/C to Calgary's 9,136. That gap has only widened since then, so not sure exactly what you're talking about.

Also, NIMBYs have always been a huge part of Vancouver's development scene. The tallest densest developments have all occurred in the last 10 years, and the buildings are just getting taller and denser on average, so once again I've no idea what you are talking about.

[geotag277]

Originally Posted by LeftCoaster

Calgary is putting Vancouver to shame on Multifamily?

I only have the Dec 2015 stats since that is all that's available for free on CMHC but Vancouver had 21,131 multifamily dwellings U/C to Calgary's 9,136. That gap has only widened since then, so not sure exactly what you're talking about.

Also, NIMBYs have always been a huge part of Vancouver's development scene. The tallest densest developments have all occurred in the last 10 years, and the buildings are just getting taller and denser on average, so once again I've no idea what you are talking about.

For a city of 2.5 million that number is embarrassing, especially considering Vancouver's unique land constraints. Calgary is known as a ridiculous sprawling city, so the fact our per capita density numbers are in line with Vancouver should be flabbergasting to Vancouver residents.

Building tall towers downtown is nice, but it doesn't really indicate anything special is going on. Trump Tower and Shangri La are not a sustainable urban strategy. Vancouver's development outside of downtown is pathetic.

I can guarantee once Calgary hits 2.5 million it will have more multi-family than Vancouver does today. As a city grows it's multi family needs to accelerate. Vancouver is falling on it's 🞵🞵🞵.

[ssiguy]

Vancouver is building tons of condos strictly to the Chinese to launder their money and then flip to another Chinese "investor".

I usually think Dianne Francis is a glorified mouthpiece but she is absolutely right on this one and thankfully she has never been one to hold things back and she calls a spade a spade.

[Pinion]

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