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Lead out in cuffs posted:Isn't there also the issue of selling the property in the first place? I mean, wasn't part of the problem in the US housing crisis that there simply wasn't enough liquidity in the market for the banks to unload the properties at any price, let alone a fair one? In this regard, I think the fact we've priced so many people out of ownership might be our saving grace. I'm not educated about the markets in the rest of the country, but at least in Calgary, we have people paying so much for rent that they'd jump at buying a "distressed" property for a decent fraction of its current value.
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Mar 1, 2014 09:21
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PT6A posted:In this regard, I think the fact we've priced so many people out of ownership might be our saving grace. I'm not educated about the markets in the rest of the country, but at least in Calgary, we have people paying so much for rent that they'd jump at buying a "distressed" property for a decent fraction of its current value. As the current ownership rate is 70% this will be less of a saving grace than you might think. Most people that can and want to own already do. They may want a larger place or a detached house, but they would need to sell their current place in that collapsed environment.
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Mar 1, 2014 19:05
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Getting a mortgage during the collapse might be a tad difficult so you'd better have some substantial cash saved. Also most people are not contrarian.
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Mar 1, 2014 19:08
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iv46vi posted:Getting a mortgage during the collapse might be a tad difficult so you'd better have some substantial cash saved. Also most people are not contrarian. This was one of the problems in the US Housing Collapse. Anyone who could fog a mirror had been able to get a mortgage so those that wanted a house already had one. The number of prudent "not buying, price is too high" people were a drop in the bucket and even then found themselves either subjected to much harsher scrutiny for lending or facing delusional sellers unwilling to accept that their home isn't worth what they dreamed it would be (or owe on it). Finally, nobody wants to try and catch a falling knife.
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Mar 1, 2014 19:36
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PT6A posted:In this regard, I think the fact we've priced so many people out of ownership might be our saving grace. I'm not educated about the markets in the rest of the country, but at least in Calgary, we have people paying so much for rent that they'd jump at buying a "distressed" property for a decent fraction of its current value. I don't have anything to back up this claim, but I was under the assumption that a lot of houses that went under in the US were basically bundled together and sold at auction. People who were already millionaires got some pretty sweet deals, buying up like a dozen houses at once for only 100k per house. These were private auctions too, so even if some schlub could come in to these auctions, you needed a million just to make a starting bid. I imagine canada will do the same thing, rigging the system so only the rich can continue to be rich.
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Mar 2, 2014 09:16
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Freakazoid_ posted:I don't have anything to back up this claim, but I was under the assumption that a lot of houses that went under in the US were basically bundled together and sold at auction. People who were already millionaires got some pretty sweet deals, buying up like a dozen houses at once for only 100k per house. These were private auctions too, so even if some schlub could come in to these auctions, you needed a million just to make a starting bid. "I don't know what actually happened, but here's what I think happened, and I assume that the same thing will happen in Canada"
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Mar 2, 2014 09:39
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Pimco, worlds largest bond fund, predicting housing drop of up to 30% this year.
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Mar 3, 2014 23:17
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Meh. I'll believe it when I see it.
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Mar 4, 2014 03:05
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The obvious flaw with that article is that it treats the Canadian housing market as a whole, while clearly there are some very meaningful differences between cities. The Toronto and Vancouver markets are, in any realistic estimation, greatly overvalued compared to the markets in the rest of the country, and those markets probably make up a great portion of the Canadian housing market by any metric, but I don't think the situation is quite as dire as presented, if you're looking at the value of your property in most other areas of the country.
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Mar 4, 2014 08:31
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http://www.bnn.ca/News/2014/02/27/Mortgage-insurer-CMHC-primes-market-for-announcement.aspx Everyone knows reinhart and rogoff are loving clowns. Here's more evidence. Oh and guess what's the best predictor of a financial crisis? Rapid credit growth.
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Mar 4, 2014 13:06
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That's not even what the article says though is it? It says they are expecting a 10 to 20% decline in real terms in the next 3-5 years. You make it sound like a bubble pop, they make it sound like a relatively more ordered return to normal. In fact, if you take out the Globe perspective and just read the guys report, the salient bits of which are linked in Garth Turner's blog post today, it doesn't sound like a US collapse at all... quote:Pimco said.....
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Mar 4, 2014 16:41
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Saltin posted:That's not even what the article says though is it? It says they are expecting a 10 to 20% decline in real terms in the next 3-5 years. You make it sound like a bubble pop, they make it sound like a relatively more ordered return to normal. In fact, if you take out the Globe perspective and just read the guys report, the salient bits of which are linked in Garth Turner's blog post today, it doesn't sound like a US collapse at all... The US housing collapse started in 2006 and, depending on the market, may still be on going. It likely will look similar, just without taking the world economy with it.
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Mar 4, 2014 17:53
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ocrumsprug posted:It likely will look similar That's one of an unknowable set of possible futures. This is something no one can credibly prognosticate. The only thing I'm willing to say with certainty is that the next 10 years in Canadian housing will look nothing like the previous 10.
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Mar 4, 2014 17:59
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Saltin posted:That's not even what the article says though is it? It says they are expecting a 10 to 20% decline in real terms in the next 3-5 years. You make it sound like a bubble pop, they make it sound like a relatively more ordered return to normal. In fact, if you take out the Globe perspective and just read the guys report, the salient bits of which are linked in Garth Turner's blog post today, it doesn't sound like a US collapse at all... The article has changed since I posted it. If you note the URL, that was the original headline.
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Mar 4, 2014 18:06
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Lexicon posted:That's one of an unknowable set of possible futures. This is something no one can credibly prognosticate. Yeah, I would be the last one to present my prognostications as anything worth paying much mind to. I thought it was insane in Vancouver in 2006. I was more just stating that a 30% decline over 3-5 years, like the report indicates, would probably look exactly like the what happened in the US.
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Mar 4, 2014 18:13
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They also say a 10-20% real drop (inferred to be versus nominal). Incorporating 2% inflation over the 5-year period means we could see nominal movements of anywhere from 0 to -10%. If it's the former, there will be a lot of idiots that don't see a correction at all (because I didn't lose anything amirite). That said, a housing correction has been predicted on and off at various times by many different observers, and none of them have been right yet. These guys are more credible than some but they may also have a vested interest due to short interest in CMBOs or other securities and seeking to generate a favourable movement. Any time someone whose primary job is to make money from the market says something directional I take it with a very large grain of salt. What's the forecast history of the people quoted in the article? Are they historically bearish or bullish? How is PIMCO invested in the housing market and how might they benefit from a correction? A few things to ask before taking their commentary at face value.
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Mar 4, 2014 18:57
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ocrumsprug posted:I was more just stating that a 30% decline over 3-5 years, like the report indicates, would probably look exactly like the what happened in the US. They aren't calling a 30% decline over 3-5 years, Kalenn just described why, but even if they were, that is a gradual unwinding compared to what happened in the US, which was decidedly a loving pop.
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Mar 4, 2014 19:00
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Kalenn Istarion posted:What's the forecast history of the people quoted in the article? Are they historically bearish or bullish? How is PIMCO invested in the housing market and how might they benefit from a correction? A few things to ask before taking their commentary at face value. No idea if they have taken a short position, but they did reduce the exposure to Canada of a 250billion fund they manage by 50%, so they put some money where their mouth is. I agree with you completely though - when it comes to equities there are even some "analysts" I generally do the exact opposite of, because they say one thing and do the exact opposite too.
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Mar 4, 2014 19:03
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Kalenn Istarion posted:Any time someone whose primary job is to make money from the market says something directional I take it with a very large grain of salt. This is, of course, exceedingly wise as a general principle.
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Mar 4, 2014 20:59
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My 1970s North Vancouver condo had a $10,000 per unit special assessment for new pipes (leaks all over every few months) and now everyone's trying to sell and no one can. It's a trendy area close to the ocean and downtown but new 500 sq foot condos go for $300,000 and anyone who bought in the last five years spent more than that. I paid $230k in 2005 and would be lucky to get my money back right now. Luckily I can afford to stay put, but I seem to be in the minority. My wife's friend is selling a few kms to the west in arguably the most desirable neighbourhood and can't get a bite: http://www.chantalvignola.com/Featured_Listings.php/Details/212 ($549k for 960 sq feet in a 1970s building)
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Mar 5, 2014 02:25
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This is because Canada stopped the whole "buy a visa" program. Vancouver needs its rich chinese investors!
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Mar 5, 2014 02:49
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Baronjutter posted:This is because Canada stopped the whole "buy a visa" program. Vancouver needs its rich chinese investors! It's interesting how it pushed everyone to overspend though - my building is 99% white, with the only visible minority household being black. No rentals allowed, so no investors.
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Mar 5, 2014 03:03
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leidend posted:No rentals allowed, so no investors. The condo below the one I rent was bought by an investor. It's empty. Has been for over a year. Kerrisdale.
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Mar 5, 2014 03:50
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What's the rental vacancy rate like in Vancouver? In Calgary it's still ridiculously low. I can't see a decent place staying empty for long, as long as the owner doesn't want some completely ridiculous amount of rent. Has the overheated real estate market in Vancouver created a glut of rental properties or something, or are they just asking for too much rent?
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Mar 5, 2014 03:57
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PT6A posted:What's the rental vacancy rate like in Vancouver? In Calgary it's still ridiculously low. I can't see a decent place staying empty for long, as long as the owner doesn't want some completely ridiculous amount of rent. Has the overheated real estate market in Vancouver created a glut of rental properties or something, or are they just asking for too much rent? The official rate is quite low, however the official rate apparently doesn't include privately owned condo and house rentals. The real rate is unknown.
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Mar 5, 2014 04:19
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PT6A posted:What's the rental vacancy rate like in Vancouver? In Calgary it's still ridiculously low. I can't see a decent place staying empty for long, as long as the owner doesn't want some completely ridiculous amount of rent. Has the overheated real estate market in Vancouver created a glut of rental properties or something, or are they just asking for too much rent? There's virtually nothing because rent prices are closer to real market value and no one can afford to buy because we don't have high paying jobs like Calgary. I bought because trying to find a decent place to rent is super stressful. My area is forcing huge amounts of rental units on new condos, like this one: http://www.nsnews.com/news/15-storey-tower-proposed-for-keith-road-1.862687 quote:If approved, the project will include 52 condos and 41 rental suites, which must remain rental for the building's lifespan. ductonius posted:The condo below the one I rent was bought by an investor. It's empty. Has been for over a year. Kerrisdale. Kerrisdale is its own crazy beast. Things aren't quite that heated here. UnfortunateSexFart fucked around with this message at 04:27 on Mar 5, 2014 |
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Mar 5, 2014 04:22
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PT6A posted:What's the rental vacancy rate like in Vancouver? In Calgary it's still ridiculously low. I can't see a decent place staying empty for long, as long as the owner doesn't want some completely ridiculous amount of rent. Has the overheated real estate market in Vancouver created a glut of rental properties or something, or are they just asking for too much rent? You would not believe the bullshit. My disabled mother is trying to find a 2 bedroom place for her and my brother right now and everything under $1000 is basically a 500 sqft hellhole that someone slapped together out of plywood and spit in their crawlspace. She went and looked at one yesterday that had the washer and dryer outside in a mud floored shack. Former full basement suites have been subdivided into two or three separate units which are then rented at the same rate the entire basement was previously. There's no shortage of places to rent, there's just a shortage of people who can afford to rent them without hotbunking. It's made worse due to zero enforcement against blatantly illegal suites by the city, so landlords can all but get away with murder here right now.
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Mar 5, 2014 04:53
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Watching shows like Income Property is probably at fault for some of that pricing. I can't stop laughing in horror when I see Scott McGillivray tell someone they can rent out their one-bedroom basement suite with microkitchen for $900. (My one-bed apartment in a large complex is that much.) The worst one I saw the other week had the couple charge and get enough income off their single-occupancy basement suite to pay the entire mortgage payment with several hundred dollars in profit. They were literally charging this poor bastard more than the entire house to live in the basement while they occupied the upstairs.
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Mar 5, 2014 05:03
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Blade_of_tyshalle posted:Watching shows like Income Property This loving country.
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Mar 5, 2014 07:04
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Wasn't there a vancouver version of that show? Keep pumping the market up. As far as I'm concerned, it'll just make the collapse hurt that much more.
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Mar 5, 2014 07:33
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Cultural Imperial posted:Wasn't there a vancouver version of that show? Flip that house or whatever, there's still radio ads for going to the hosts seminars on selling real-estate too, real snake-oil stuff
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Mar 5, 2014 07:39
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Lexicon posted:This is, of course, exceedingly wise as a general principle. My favourite is Eric Sprott's bull calls on gold. He still gets BNN airtime for this which just blows my mind. He's probably one of he largest single holder of gold stocks in Canada, so he's got his money where his mouth is but you can hardly call his pumping altruistic and objective.
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Mar 5, 2014 08:27
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Rental enforcement is so lovely in this country. I wonder if it has to do with urban Canada generally getting poo poo on by suburban and rural populations. Even though there are more urban Canadians in terms of numbers, we don't let permanent residents or people on visas vote, so they're barely regarded as being people.
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Mar 5, 2014 14:04
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Lexicon posted:That's one of an unknowable set of possible futures. This is something no one can credibly prognosticate. Thomas Friedman's account spotted
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Mar 5, 2014 14:37
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One third of Canadians would engage in a "bidding war " for a house. Keep buying you loving retards. http://m.theglobeandmail.com/globe-...?service=mobile
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Mar 5, 2014 18:04
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Cultural Imperial posted:One third of Canadians would engage in a "bidding war " for a house. Keep buying you loving retards. With what money? They're poorer than they think.
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Mar 5, 2014 18:38
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With debt! But it's good debt because investments. Just like government infrastructure spending, you go into debt and buy buy buy when rates are low then you profit later as your investment reaps massive yields. Buying households isn't like household finances!
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Mar 5, 2014 18:39
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Hey the bank pre-approved me for 500k, there's no reason I shouldn't use this money! True story, a couple of friends who make about 80k together, already have a car loan, consumer debt in the five figures and a baby on the way got pre-approved for something ridiculous like 500k. They were reasonable and only spent ~250 on the house.
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Mar 5, 2014 21:10
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FrozenVent posted:Hey the bank pre-approved me for 500k, there's no reason I shouldn't use this money! That's some loving bullshit compared to my experience in getting pre approved for a 400k mortgage in seattle. And motherfuckers say there is no sub prime in Canada.
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Mar 5, 2014 21:45
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I got about 300k approved yet even with no debts or other major costs that would absolutely cripple me.
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Mar 5, 2014 21:47
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