When do you think the Vancouver housing bubble will explode and come crashing down ?

[MaxVerstappen33]

12 hours ago, Naslund said:

 

 

 

 

My buddy who is a realtor told me that there is never a bad time to buy. So whether it increases or decrease substantially would not matter as long as you manage your Finance and intend to live there?

 

 

 

 

 

 

 

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Realtors always say that. Clearly when you see a chart that is a carbon copy  of all the great financial bubbles of all time, its  probably not an ideal time to buy. But these bubbles are very  powerful and people get caught  up in them.

 

[dyuester]

http://vancouversun.com/business/real-estate/b-c-liberals-must-pull-off-balancing-act-on-real-estate-observers 

 

"The Real Estate Board of Greater Vancouver released data Friday showing that home sales tumbled by 26 per cent in August compared to the same period last year. Despite the drop in sales, the board reported the composite benchmark price for all residential properties in Metro Vancouver had jumped more than 30 per cent since August 2015, to about $933,000."

 

[trek]

Excellent. Reduce foreign investment, keep the prices going up. Works for me.

[DonLever]

A realtor (Steve Sarestsky)  disputes the Real Estate Board figures.

 

From CKNW:

 

“For a condo and town homes it’s still a sellers’ market but for the detached market look at how many sales there are and look at how many active listings there are, you can just see that right away in the price reductions.”

Sarestsky looked at four markets — East and West Vancouver, Richmond and Burnaby.

 

He says across Metro Vancouver, detached houses were down 57 per cent compared to 2015.

They were down 46 per cent when you compare the typical average sales for the month of August between 2010 and 2014.

He adds that data released by the board can be biased.

“The Real Estate Board what they release every month is processed sales, which basically means that some of the deals that were done, some of them go as far back as May. What’s important to look at is the date that both parties agree to a purchase contract.”

He says it’s a buyers’ market — detached homes are seeing price reductions of over $100,000 and many are sitting on the market over 100 days.

[Harvey Spector]

Steve Sarestsky is correct. In regards to detached single family homes across the largest areas we are in a buyer's market. The REBGV reports numbers across all of Metro Vancouver and combines detached, attached and condos into one number. The sales to active listings ratio, which is basically the key indicator of the state of the housing market, was reported by the REBGV to be 29.3%. That indicates a seller's market. Basically anything above 20% is a seller's market, anything below 12% is a buyer's market, and anything in between, 12%-20%, is a balanced market. The ratio is determined by the number of sales that month divided by the number of active listings. 

 

However, as Steve pointed out, if you break it down to detached single family homes and you use the largest areas, then the ratio tells a different story:

 

Sales to active listings ratio in August 2016 for detached single family homes:

 

North Vancouver - 31%

Surrey - 13%

Vancouver East - 13%

Vancouver West - 10%

Burnaby - 10%

West Vancouver - 8%

Richmond - 7.5%

 

So as you can see in only one area, North Vancouver, are we actually in a seller's market in regards to detached homes. In Surrey and Vancouver East we are on the cusp of a buyer's market, and in Vancouver West, Burnaby, West Vancouver and Richmomd we are definitely in a buyer's market. Also, although the ratio in North Vancouver is still quite high at 31%, it was actually at 94% in March, so it is in free fall like all the other areas. 

 

So to summarize, in regards to detached single family homes across Metro Vancouver as of today we are in a buyer's market. In regards to condos and townhouses we are still in a seller's market, where the sales to active listings ratio is 53%, and we are still getting multiple offers and sale prices above ask on the condo and townhouse side. However, even on the condo and townhouse side sales are still down 15% from July and the sales to active listings ratio is down from 59% to 53%. 

[Naslund]

On ‎2016‎-‎09‎-‎04 at 9:13 AM, LolClarkson said:

 

 

Realtors always say that. Clearly when you see a chart that is a carbon copy  of all the great financial bubbles of all time, its  probably not an ideal time to buy. But these bubbles are very  powerful and people get caught  up in them.

 

Yes I always laugh inside when he says that but I understand as they need to sell themselves. What I meant was why would owners be concerned about property value dropped if they intend to live there and not to sell. I would hate it as an owner having a property increase as I would have to pay more property tax.

 

[Naslund]

On ‎2016‎-‎09‎-‎04 at 9:12 AM, Warhippy said:

I find it amusing that according to builders, real estate agencies and the government as of 3 months ago that foreign ownership was not an issue

 

Now though it is accounting for thousands of lost jobs, millions or more in lost revenue and the preciptious plunge and stagnation of home sales and prices.

 

I cannot get my head around people who back track.

 

This is literally nothing.  As was stated 30% only brings us about 18 months or so back in time.  A true crash is when we wake up and have lost 50% of the total value of our homes.  This is just a gently falling leaf.  If home prices can increase by almost 30% over a single calendar year in some places or 50% over a series of years there is little to truly worry about

 

Unless of course your entire economy is based upon real estate sales and taxation.  In which case, well hey...I bet you wish it was the non issue you pretended it was for over 16 years right?

So true.  I would be interested to know what the true property value should be without foreign content.  Overall I am more concerned over the economic state in Canada than some rant by builders/ RE agencies in Vancouver.

[Harvey Spector]

21 minutes ago, Naslund said:

Yes I always laugh inside when he says that but I understand as they need to sell themselves. What I meant was why would owners be concerned about property value dropped if they intend to live there and not to sell. I would hate it as an owner having a property increase as I would have to pay more property tax.

 

Because for the last 10 years people have been using their homes as there own personal piggy bank. So when prices go up they run to the bank and refinance their homes and take out the equity to fund their lavish lifestyles. The average income in Vancouver is $43,000. How you do think these average people have been funding their lifestyles, trips every year, cars, furniture, clothes, going out to fancy dinners. What do you think has spurred this robust economy for the last 10 years?  

 

Rising prices have allowed people to live above their means and spend, spend and then spend some more. When prices come down, the party is effectively over.  Their equity in their homes will be gone.  People will hunker down and go into savings mode. It happens during every recession. When people's houses go up in value they feel rich so they spend. When their houses go down in value they feel poor so they cut back and start saving. 

 

I keep saying if the market tanks we will go into recession with high unemployment.  This will happen because when people stop spending the economy will come to a complete halt. People will then lose their jobs and we will be in recession. It's a vicious cycle but something that is inevitable with a market crash. We will see what happens over the next 6 months as things could change and this all could be just a blip in the market, but right now it's not looking so good. 

 

[MaxVerstappen33]

20 hours ago, DonLever said:

A realtor (Steve Sarestsky)  disputes the Real Estate Board figures.

 

From CKNW:

 

“For a condo and town homes it’s still a sellers’ market but for the detached market look at how many sales there are and look at how many active listings there are, you can just see that right away in the price reductions.”

Sarestsky looked at four markets — East and West Vancouver, Richmond and Burnaby.

 

He says across Metro Vancouver, detached houses were down 57 per cent compared to 2015.

They were down 46 per cent when you compare the typical average sales for the month of August between 2010 and 2014.

He adds that data released by the board can be biased.

“The Real Estate Board what they release every month is processed sales, which basically means that some of the deals that were done, some of them go as far back as May. What’s important to look at is the date that both parties agree to a purchase contract.”

He says it’s a buyers’ market — detached homes are seeing price reductions of over $100,000 and many are sitting on the market over 100 days.

Interesting

 

There will be a tug of war with the data as time goes on

[MaxVerstappen33]

18 hours ago, Harvey Spector said:

Steve Sarestsky is correct. In regards to detached single family homes across the largest areas we are in a buyer's market. The REBGV reports numbers across all of Metro Vancouver and combines detached, attached and condos into one number. The sales to active listings ratio, which is basically the key indicator of the state of the housing market, was reported by the REBGV to be 29.3%. That indicates a seller's market. Basically anything above 20% is a seller's market, anything below 12% is a buyer's market, and anything in between, 12%-20%, is a balanced market. The ratio is determined by the number of sales that month divided by the number of active listings. 

 

However, as Steve pointed out, if you break it down to detached single family homes and you use the largest areas, then the ratio tells a different story:

 

Sales to active listings ratio in August 2016 for detached single family homes:

 

North Vancouver - 31%

Surrey - 13%

Vancouver East - 13%

Vancouver West - 10%

Burnaby - 10%

West Vancouver - 8%

Richmond - 7.5%

 

So as you can see in only one area, North Vancouver, are we actually in a seller's market in regards to detached homes. In Surrey and Vancouver East we are on the cusp of a buyer's market, and in Vancouver West, Burnaby, West Vancouver and Richmomd we are definitely in a buyer's market. Also, although the ratio in North Vancouver is still quite high at 31%, it was actually at 94% in March, so it is in free fall like all the other areas. 

 

So to summarize, in regards to detached single family homes across Metro Vancouver as of today we are in a buyer's market. In regards to condos and townhouses we are still in a seller's market, where the sales to active listings ratio is 53%, and we are still getting multiple offers and sale prices above ask on the condo and townhouse side. However, even on the condo and townhouse side sales are still down 15% from July and the sales to active listings ratio is down from 59% to 53%. 

 

 

 

 

Take what the sell side says with a grain of salt. What they call a buyers market right now is what some call catching a falling knife

 

 

[taxi]

12 hours ago, Harvey Spector said:

Because for the last 10 years people have been using their homes as there own personal piggy bank. So when prices go up they run to the bank and refinance their homes and take out the equity to fund their lavish lifestyles. The average income in Vancouver is $43,000. How you do think these average people have been funding their lifestyles, trips every year, cars, furniture, clothes, going out to fancy dinners. What do you think has spurred this robust economy for the last 10 years?  

 

Rising prices have allowed people to live above their means and spend, spend and then spend some more. When prices come down, the party is effectively over.  Their equity in their homes will be gone.  People will hunker down and go into savings mode. It happens during every recession. When people's houses go up in value they feel rich so they spend. When their houses go down in value they feel poor so they cut back and start saving. 

 

I keep saying if the market tanks we will go into recession with high unemployment.  This will happen because when people stop spending the economy will come to a complete halt. People will then lose their jobs and we will be in recession. It's a vicious cycle but something that is inevitable with a market crash. We will see what happens over the next 6 months as things could change and this all could be just a blip in the market, but right now it's not looking so good. 

 

Fewer empty homes and more home affordability could also have a positive effect on the economy that could far outweigh any downturn caused by depressed prices. Having a middle class family work and live in Vancouver is going to have a far greater positive effect than a few families using equity to spend in a very short term way. 

 

A 40% reduction in home prices might not have the negative effect you're predicting. With the low dollar, Vancouver has a very good opportunity to stimulate other industries. A major issue holding this back is the cost of housing and capital.

[taxi]

On 9/4/2016 at 9:12 AM, Warhippy said:

I find it amusing that according to builders, real estate agencies and the government as of 3 months ago that foreign ownership was not an issue

 

Now though it is accounting for thousands of lost jobs, millions or more in lost revenue and the preciptious plunge and stagnation of home sales and prices.

 

I cannot get my head around people who back track.

 

This is literally nothing.  As was stated 30% only brings us about 18 months or so back in time.  A true crash is when we wake up and have lost 50% of the total value of our homes.  This is just a gently falling leaf.  If home prices can increase by almost 30% over a single calendar year in some places or 50% over a series of years there is little to truly worry about

 

Unless of course your entire economy is based upon real estate sales and taxation.  In which case, well hey...I bet you wish it was the non issue you pretended it was for over 16 years right?

The back tracking is quite funny.

 

That being said, the tax may not be the main factor here. It's a global phenomenon right now. Sales have come to a halt globally. There's no way to spin this positively. The government has put our economic fate entirely at the mercy of  external factors that cannot be controlled. NYC, Hong Kong, London, San Francisco, Vancouver, etc...all of these markets are frozen.

[Warhippy]

15 minutes ago, taxi said:

The back tracking is quite funny.

 

That being said, the tax may not be the main factor here. It's a global phenomenon right now. Sales have come to a halt globally. There's no way to spin this positively. The government has put our economic fate entirely at the mercy of  external factors that cannot be controlled. NYC, Hong Kong, London, San Francisco, Vancouver, etc...all of these markets are frozen.

Sadly though and truthfully told,  a number of people I know in the industry are being contacted by clients or buyers and are now searching the entire lower mainland as well as Tofino, Victoria and Sooke and the entire Okanagan

 

For the price of a 100' lot in vancouver the option of buying a 5 acre orchard in the south okanagan is available, or a home on lands end in Tofino where prices are still climbing and due to location are by and large insulated from major losses which will be experienced in the major cities should a correction or crash happen.

 

The backtracking is amusing without a doubt, but the fact that they just pushed this problem in to what was the affordable areas of the province.

 

Is not

 

Without province wide protection it's kicking the can down the road for the next person to deal with

[taxi]

2 minutes ago, Warhippy said:

Sadly though and truthfully told,  a number of people I know in the industry are being contacted by clients or buyers and are now searching the entire lower mainland as well as Tofino, Victoria and Sooke and the entire Okanagan

 

For the price of a 100' lot in vancouver the option of buying a 5 acre orchard in the south okanagan is available, or a home on lands end in Tofino where prices are still climbing and due to location are by and large insulated from major losses which will be experienced in the major cities should a correction or crash happen.

 

The backtracking is amusing without a doubt, but the fact that they just pushed this problem in to what was the affordable areas of the province.

 

Is not

 

Without province wide protection it's kicking the can down the road for the next person to deal with

This may be a bit of a myth. Everyone assumed that foreign investment would just switch to other targets after the tax, but things seem to pretty stable in Victoria:

 

http://www.timescolonist.com/business/victoria-housing-market-stable-cmhc-1.2311843

 

Could be more evidence for the downturn being caused by external factors and not the tax. Victoria saw the same huge jump at the beginning of 2016 that Vancouver saw, but things have now leveled off there too:

 

http://househuntvictoria.ca/

 

It could be evidence for the money just being gone, as opposed to moving elsewhere. The Chinese government has finally closed the leak.

[MaxVerstappen33]

28 minutes ago, taxi said:

The back tracking is quite funny.

 

That being said, the tax may not be the main factor here. It's a global phenomenon right now. Sales have come to a halt globally. There's no way to spin this positively. The government has put our economic fate entirely at the mercy of  external factors that cannot be controlled. NYC, Hong Kong, London, San Francisco, Vancouver, etc...all of these markets are frozen.

The people in the FIRE economy ( finance, insurance and real estate) want to blame the tax for the bubble party coming to an end. But that's not what did it. These pyramids of speculation just exhaust themselves eventually. They are still in the denial stage.

[MaxVerstappen33]

12 minutes ago, taxi said:

This may be a bit of a myth. Everyone assumed that foreign investment would just switch to other targets after the tax, but things seem to pretty stable in Victoria:

 

http://www.timescolonist.com/business/victoria-housing-market-stable-cmhc-1.2311843

 

Could be more evidence for the downturn being caused by external factors and not the tax. Victoria saw the same huge jump at the beginning of 2016 that Vancouver saw, but things have now leveled off there too:

 

http://househuntvictoria.ca/

 

It could be evidence for the money just being gone, as opposed to moving elsewhere. The Chinese government has finally closed the leak.

The market is rank with local speculators who are just as culpable for it all. There was tough legislation in 2014 that curbed lots of Chinese money. That didn't put a dent in prices.

[Realtor Rod]

30 minutes ago, taxi said:

This may be a bit of a myth. Everyone assumed that foreign investment would just switch to other targets after the tax, but things seem to pretty stable in Victoria:

 

http://www.timescolonist.com/business/victoria-housing-market-stable-cmhc-1.2311843

 

Could be more evidence for the downturn being caused by external factors and not the tax. Victoria saw the same huge jump at the beginning of 2016 that Vancouver saw, but things have now leveled off there too:

 

http://househuntvictoria.ca/

 

It could be evidence for the money just being gone, as opposed to moving elsewhere. The Chinese government has finally closed the leak.

Its the same here in Abbotsford. Just nice steady work. Still multiple offers, but also price reductions etc. 

[Realtor Rod]

24 minutes ago, LolClarkson said:

The people in the FIRE economy ( finance, insurance and real estate) want to blame the tax for the bubble party coming to an end. But that's not what did it. These pyramids of speculation just exhaust themselves eventually. They are still in the denial stage.

Supply and demand...

[taxi]

51 minutes ago, LolClarkson said:

The market is rank with local speculators who are just as culpable for it all. There was tough legislation in 2014 that curbed lots of Chinese money. That didn't put a dent in prices.

Speculation from locals can only take the market so high, as the locals only have so much money. I do agree this was a major problem and a major reason for the increased prices up to 2014. Beyond that a driving factor has been the foreign investment. My point about the local legislation being unable to curb foreign investment is pretty spot on, hence the downturn globally. The main driving factors curbing foreign investment right now are crack downs from the Chinese government. The "tough legislation" in 2014 and the new tax are largely for show. 

[MaxVerstappen33]

On 2016-05-31 at 6:02 AM, Hugor Hill said:

Looking at graphs alone is like using technical analysis to evaluate stocks. It doesn't work. We got to look at the causes and reasons behind the numbers.

 

Canada and Australia and much of Asia didn't crash because we didn't have messed up mortgage practices like the US. 

 

As long as Vancouver stays amongst the favourite destinations for international investors to park their money, the real estate market will remain strong.