Is it me or is the Westside getting creamed?

[gse36]

another bailer.. 3963 w22nd.. 33x122. asking 1.78M paid 1.805M in feb 2012! never lived in

mainlander as well. these are just like stocks tot hem. they buy to speculate. right now market going sideways, may as well get out what you can and invest elsewhere or deleverage.

[nsguy]

403 West 19th
Original ask was $2,288,000 in June last year, then was terminated in Oct last year, then Re listed for $2,488,000 in May this year, and now reduced to $2,388,000. Land was purchased for $1,322,000 in March last year.

[Warren12]

403 West 19th
Original ask was $2,288,000 in June last year, then was terminated in Oct last year, then Re listed for $2,488,000 in May this year, and now reduced to $2,388,000. Land was purchased for $1,322,000 in March last year.

Hmmm so the original selling price was pre-contstruction. Should be interesting to see where it lands. I pass this place on my commute every day. Maybe it will drop to my six-figure price range.

[gse36]

Hmmm so the original selling price was pre-contstruction. Should be interesting to see where it lands. I pass this place on my commute every day. Maybe it will drop to my six-figure price range.

house looks pretty bad! you like that style?

[bcj]

It seems like the market for $2M+ sfh in this area is no more (if it ever actually existed outside of a developer's imagination). The following listings have been sitting quite a while

1) http://www.realtor.ca/propertyDetails.a ... -348003399 @2M reduced from 2.2M
- not a new build, but comparable
2) http://www.realtor.ca/propertyDetails.a ... 1112547396 @2.5M
3) http://www.realtor.ca/propertyDetails.a ... 1607910940 @2.35M reduced from ~2,5M
4) http://www.realtor.ca/propertyDetails.a ... 2068193445 @2M reduced from ~2.2M

#3 was sold as a teardown for 1.5 - 1.6M early in 2011. After some early reductions it has sat at 2.35 for a long time. Funny because it's quite comparable to #4 which has been sitting at $2M for a long time. Big air pocket under the market when the price insensitive foreigners take a pass.

[Warren12]

Hmmm so the original selling price was pre-contstruction. Should be interesting to see where it lands. I pass this place on my commute every day. Maybe it will drop to my six-figure price range.

house looks pretty bad! you like that style?

Whats wrong with it? My impression comes from a real-life ride by every day, not the pictures online.

[gse36]

Hmmm so the original selling price was pre-contstruction. Should be interesting to see where it lands. I pass this place on my commute every day. Maybe it will drop to my six-figure price range.

house looks pretty bad! you like that style?

Whats wrong with it? My impression comes from a real-life ride by every day, not the pictures online.

personal preference i guess. sorta a sore thumb. inside and out. feels much like a townhouse. interior is townhouse grade.

unless they changed that thing since i last toured it... not really my cup of tea. esp for the price!

but yeah, for 6 figures, i guess could live with it .. or tear it down and build sth proper

[robert james]

Sam may be the guy in the know on this one.. http://www.samwyatt.com/Blog.php/july-m ... te-to-sell

[jesse1]

Sam had some astute and well-presented comments that should not be wholly unfamiliar to regular lurkers on this forum.

High MOI means price drops.
Westside is overbought and investment from foreign capital sources was a reason for this.
If you want to sell, lower the price.

I didn't see anything in there to be censured, just the straight goods on the situation.

[Taipan]

Well you’ve been hearing it from me for ages. No market runs up like this without crashing. Cause too much finance, interest rates too low, and terms that were too long.

A few of the uber bulls continue to deny the precipice they have now fallen over forecasting drops of up to 15%. After which it will continue to quickly regain that previous high and keep going up.

Of course only delusional people would believe that rubbish. A correction of similar proportions to 2008 and then a rebound upwards.

The F.I.T fuel has been taken away from the fire. Seems that nasty nasty Garth Turner had the audacity to pick the phone up and had a talk to Sam Wyatt.


“This market is collapsing.” Not every day that you hear those words sliding out of a real estate agent, since most know only six words: ‘It’s a great time to buy.’ Not for Sam Wyatt. This, he’s telling the denizens of Vancouver’s flush Westside, is the time to bail.

He’s right, of course. Supply is overwhelming demand, and the victim will be price. The stats don’t lie. The average number of detached listings in the hood over the last three years was 589. In the darkest days following the GFC, when panic cause a wave of selling, active listings never exceeded 1053. But today there are almost 1,100 houses for sale. Says Wyatt, “This is a very serious situation.”

As you may know, there’s now a 10-month supply of houses for sale in what was the hottest market in the land a year ago. Below five months is a seller’s market. Between five and eight is that mythical ‘balanced’ territory. Above that, barbarians storm the gate.

As Wyatt told me last night, “I see this moving towards a 40% drop in prices, perhaps even 50%. The smart money is getting out now, but well down the road we’ll be seeing a massive buying opportunity.”

Now who could have imagined that before it happened. Qalifications in real estate valuation would have tipped you off long before the realtors saw it unfold before them.

Many bulls, think that real estate is liquid. And yes they are partly correct but only in a rapidly rising market. When the market peaks and starts to fall it is one of the least liquid forms of all assets.

But see Sam has the right idea.

Vancouver's real estate market is getting and is going to get hit from both ends. So, now that you are thoroughly depressed, here is the bright light: IF YOU SELL NOW, YOU WILL STILL BE SELLING NEAR THE TOP OF THE MARKET. If you plan to sell, you will need to price BELOW the most recent comparable sales prices. If you don't do this, your listing will stagnate. I am pleased that this methodology has produced 4 sales in the last 30 days for my clients in a market were most homes are not selling. In one case we had a multiple offer with a significant over asking result and in another we negotiated a full asking price sale. Do visit my web site to view recent sales.

And now its happening! There is lots of pain out there. For the innocent i feel sorry - some of us have tried to warn them. As for the greedy - well they will take no notice, smug in their own misguided self belief, and they deserve whats coming!

[jesse1]

"And now its happening!"

[Taipan]

We do not like to think of ourselves as potentially irrational herd animals (that will be the Jones’s). We seek narrative frameworks that purport to explain our good fortune, ideally in ways that flatter. Reinhardt and Rogoff called it the This Time It's Different syndrome as each age sought to deflect warnings by arguing we're smarter now, better organised, or living in a different world. Just as the sellers of an overpriced home will convince themselves that it was their interior decorating skills not an inflating bubble that got them the good deal.

Of course warnings may keep coming, and almost by definition, from the fringes. When assessing risks that challenge consensus, people are more likely to defer to authority, which generally sees itself as the representative of the consensus. Furthermore, as a species with strong attachments to group affirmation, being wrong in a consensus is often a safer option than being right but facing social shaming, or especially if found to be wrong later.

Sound familiar around these parts. Those who dare speak up get ridiculed.

Far better to say: “Look, don't blame me, nobody saw this coming, even the experts got it wrong!”

But even if we can appreciate a warning, the inertia of the status quo generally ensures acting on such warnings is difficult. In general we chose the easiest path in the short-term, and the easiest path is the one we are familiar and adaptive with. We would rather put off a hard and high consequence decision now, even if it meant much higher consequences some time in the future. However, if each step on the path of least resistance is a step further from where we ideally should be, the risks associated with doing anything rise as the divergence is so much wider. Eventually one's bluff may be called, but not yet, and hopefully on somebody else’s watch.

The consensus can often be correct and the marginal voices may be deluded. The point for the risk manager is to try and step through cognitive and social blind-spots by first recognising them. This is particularly true if the risks (probability times impact) considered are very high.

Unfortunately, it is very clear that we have learned almost nothing general about risk management as a societal practice arising from the financial crisis. We have merely adopted a new consensus, with a questionable acknowledgement that we will not let this type of crisis happen again. However, the argument in this following report is that we are facing growing real-time, severe, civilisation transforming risks without any risk management. David Korowicz 'Trade-Off: Financial System Supply-Chain Cross-Contagion: a study in global systemic collapse."

Sound familiar round these parts. Herd behaviour, and This Time It's Different syndrome as each age sought to deflect warnings by arguing we're smarter now, better organised, or living in a different world.

Nah just a massive bubble. Or as Sam warns - drop your prices now and get out. It will only get worse from here!

[tdma800]

http://www.cbc.ca/news/canada/story/201 ... stors.html
Canada’s stable government and banking system and the relatively low prices draw investors, he said, pointing out that while condos in downtown Toronto can sell for $800 per square foot, in Beijing, the price is $2,000 per square foot and in Hong Kong it's double that.

Moreover, to control prices, the Chinese government allows each family there to bank finance only two properties — one to live in and one to invest in — and buyers must pay 100 per cent cash for anything above the two-property limit, Ma said.

Not only are prices in Canada more affordable, homes and condos are a better value proposition, since they come ready to move into, unlike in China, where buyers get a concrete shell they have to pay to finish, he said.

[vanpro]

From tdma's article above, Cameron Muir, chief economist for the BC Real Estate Association, calls this foreign buyer "theory" an urban "myth":

"No Canadian statistics

Unlike in the U.S., the Canadian government does not keep track of the number of properties bought by non-residents.

"I'd love to have those numbers but we don't keep them. You'd have to ask the government of Canada why not," said Cameron Muir, chief economist of the British Columbia Real Estate Association.

However, through analysis and digging up proxies, he said only about two per cent of home sales in Metro Vancouver are to non-resident buyers.

"This idea that we have this rampant foreign ownership going on and this horde of Chinese investors coming over is a little bit of an urban myth."

[tdma800]

http://www.cbc.ca/news/canada/story/201 ... stors.html
Foreign students drive market
As more people get exposure to Canada as an offshoot of globalization, the overseas investor market will rise, Hlinka said. As an instructor at George Brown College in Toronto, he has seen an explosion in the number of foreign students.

“When their parents come to visit, they get an idea of what real estate costs here, and they can’t believe how cheap it is. They want to buy because they think it’s a bargain.”

In addition to China, investors pouring money into real estate are flocking to Canada from the Middle East, Korea, Russia, India and the Philippines as well, said Tony Ma, who owns HomeLife Landmark Realty in Markham.