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Geyser
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Re: Vancouver Housing Market Implodes:

Sun Aug 21, 2016 2:00 pm

reallyreal2 wrote:
I am seeing a big slowdown in sales which I think is caused by a decent sized spread in the bid and ask on the available inventory.

The question is who blinks first - sellers or buyers.  My hunch is sellers as they hold the majority of the risk - especially those holding multiple properties or those who made recent purchases with the intention of flipping.

I'm sure it all depends on whether or not their is a panicked rush for the exits. Already there are some people in the theatre mumbling the word "fire". :shock:
In fond memory of Taipan, a model of modesty, decency, dignity and tolerance. Long may we all prosper from the tremendous legacy of worldly wisdom and specialized real estate knowledge which he left in the "Arguments" thread.
 
Geyser
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Re: Vancouver Housing Market Implodes:

Sun Aug 21, 2016 2:14 pm

eyesthebye2 wrote:
reallyreal2 wrote:
I am seeing a big slowdown in sales which I think is caused by a decent sized spread in the bid and ask on the available inventory.

The question is who blinks first - sellers or buyers.  My hunch is sellers as they hold the majority of the risk - especially those holding multiple properties or those who made recent purchases with the intention of flipping.


Land owners hold the scarce resource. Money is a lot easier to find than Vancouver land.

Yes, Canada is a small country with a massive population, availability of land will always be a problem. :lol:

On a more serious note, I was recently watching a documentary on global food supplies and the amazing advances in food production, too many to list but the bottom line was that argricultural land is becoming far more productive and hence is an unreliable investment for the future. If that is true we could see our available supply of land available to developers easily double with the stroke of a government minister's pen.

Incursions on the increasingly less critical Agricutural Reserve appears inevitable. Best and highest use and all that. And then there's our huge potential for land reclamation from the sea, that's a process which has been hugely successful in other countries.

Image
 
Geyser
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Re: Vancouver Housing Market Implodes:

Sun Aug 21, 2016 2:19 pm

semven wrote:
How far do you suppose the prices will fall before the prices again attract offshore interest in spite of the tax? Couple that with the constraints we have long argued about as physical barriers constricting supply (ALR,Border,Ocean) All of these things actually increase the Asian appetite for this location.
  Dont forget the fact that this culture is noted for an "all in" mentality when it comes to gambling, and they also think in terms of generations when it comes to time horizons in their investment strategies. 
  FWIW I have reduced my exposure in terms of RE. I`m not renting though, so I`m not a Bear. More like a Raccoon, I will buy if I see an easy opportunity, but until I do I will just take a nap.
This market could resonate for a while.
I used to enjoy halibut fishing...It always amazed me how long it took the big ones to die in the hold.

Well, in 1982 the same physical barriers were in place when our home prices dropped by more than 40%. Some properties lost around 60% of their value. Tokyo has a land shortage but their homes lost 90% of their value.
In fond memory of Taipan, a model of modesty, decency, dignity and tolerance. Long may we all prosper from the tremendous legacy of worldly wisdom and specialized real estate knowledge which he left in the "Arguments" thread.
 
Geyser
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Re: Vancouver Housing Market Implodes:

Sun Aug 21, 2016 2:51 pm

Harahomes wrote:
Deleted due to double posting.
Last edited by Geyser on Sun Aug 21, 2016 2:53 pm, edited 1 time in total.
In fond memory of Taipan, a model of modesty, decency, dignity and tolerance. Long may we all prosper from the tremendous legacy of worldly wisdom and specialized real estate knowledge which he left in the "Arguments" thread.
 
Geyser
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Re: Vancouver Housing Market Implodes:

Sun Aug 21, 2016 2:52 pm

Harahomes wrote:
Geyser wrote:
Vancouver Housing Market Implodes: Average Home Price Plunges 20% In 1 Month - "The Market Is Devastated"

Oops! It looks like the message is spreading, and that message is "look out below!".

http://www.zerohedge.com/news/2016-08-18/vancouver-housing-market-implodes-average-home-price-plunges-20-1-month-market-devas

Hi Geyser
Can you show me specific examples where house prices have plunged 20%?  I have been looking around in different markets I don't see that. 
Thanks in advance

The article was quoting stats from Zolo.ca which is a Canadian Real-estate Brokerage.  It's my understanding that they use the raw data from MLS but don't apply the "Frankenumber" smoothing, masking and other mathematical manipulations.

Here's the article's quote again:

"[size=100]Zolo, a Canadian real estate brokerage, keeps track of MLS home sales in real-time and reports prices as an average rather than the “benchmark price” used by the REBGV. It currently shows a major correction underway in most Metro Vancouver markets. According to the website, the City of Vancouver currently has an average home price of $1.1 million, down 20.7% over the last 28 days and down 24.5% over the last three months. The average detached home is $2.6 million, down 7% compared to three months ago."[/size]
In fond memory of Taipan, a model of modesty, decency, dignity and tolerance. Long may we all prosper from the tremendous legacy of worldly wisdom and specialized real estate knowledge which he left in the "Arguments" thread.
 
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semven
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Re: Vancouver Housing Market Implodes:

Sun Aug 21, 2016 6:41 pm

Geyser wrote:
semven wrote:
How far do you suppose the prices will fall before the prices again attract offshore interest in spite of the tax? Couple that with the constraints we have long argued about as physical barriers constricting supply (ALR,Border,Ocean) All of these things actually increase the Asian appetite for this location.
  Dont forget the fact that this culture is noted for an "all in" mentality when it comes to gambling, and they also think in terms of generations when it comes to time horizons in their investment strategies. 
  FWIW I have reduced my exposure in terms of RE. I`m not renting though, so I`m not a Bear. More like a Raccoon, I will buy if I see an easy opportunity, but until I do I will just take a nap.
This market could resonate for a while.
I used to enjoy halibut fishing...It always amazed me how long it took the big ones to die in the hold.

Well, in 1982 the same physical barriers were in place when our home prices dropped by more than 40%. Some properties lost around 60% of their value. Tokyo has a land shortage but their homes lost 90% of their value.

In 1982 Globalization hadnt yet taken hold....The Chinese didnt have a rapidly expanding number of millionaires wanting to hide money.....The downturn was due to domestic financial pressures with domestic appetitie for local supply.

You know this Geyser

 
Geyser
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Re: Vancouver Housing Market Implodes:

Mon Aug 22, 2016 1:00 am

semven wrote:
Geyser wrote:
semven wrote:
How far do you suppose the prices will fall before the prices again attract offshore interest in spite of the tax? Couple that with the constraints we have long argued about as physical barriers constricting supply (ALR,Border,Ocean) All of these things actually increase the Asian appetite for this location.
  Dont forget the fact that this culture is noted for an "all in" mentality when it comes to gambling, and they also think in terms of generations when it comes to time horizons in their investment strategies. 
  FWIW I have reduced my exposure in terms of RE. I`m not renting though, so I`m not a Bear. More like a Raccoon, I will buy if I see an easy opportunity, but until I do I will just take a nap.
This market could resonate for a while.
I used to enjoy halibut fishing...It always amazed me how long it took the big ones to die in the hold.

Well, in 1982 the same physical barriers were in place when our home prices dropped by more than 40%. Some properties lost around 60% of their value. Tokyo has a land shortage but their homes lost 90% of their value.

In 1982 Globalization hadnt yet taken hold....The Chinese didnt have a rapidly expanding number of millionaires wanting to hide money.....The downturn was due to domestic financial pressures with domestic appetitie for local supply.

You know this Geyser



Yes, I do know that. No two bubbles are ever exactly the same, the 1982 collapse was directly related to inability to borrow due to ridiculously high interest rates, this bust wil be at least partly due to the massive and irresponsible borrowing encouraged by ridiculously low interest rates. History might not be repeating itself but it certainly rhymes.
In fond memory of Taipan, a model of modesty, decency, dignity and tolerance. Long may we all prosper from the tremendous legacy of worldly wisdom and specialized real estate knowledge which he left in the "Arguments" thread.
 
tdma800
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Re: Vancouver Housing Market Implodes:

Wed Aug 24, 2016 10:31 am

Things are diffenret here and its a new normal. This isn't Japan. It isnt well known among the average population that Japan isnt that accepting of outsiders, even those that speak the language perfectly.
 
VanBullBear
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Re: Vancouver Housing Market Implodes:

Fri Aug 26, 2016 7:59 am

It's hilarious how we have so many permanent bulls who think prices can go up forever...
EVERY MARKET CYCLES.

The market is designed as a negative feedback loop, if there is too much demand against the supply the price increases. The increases will dampen the demand because it filters out the buyers who are not willing to pay until the market is balanced again. The same goes for price going down (the market will find more buyers). What perma-bulls fail to realize that this process takes time. This isn't the stock market where you can place a market order and have your position filled in a matter of seconds - it can take months to do the transaction.

Just because the prices have been going up for years it does not mean it can go on doing so forever. - THE REAL ESTATE MARKET CYCLE IS INHERENTLY SLOW.
Nobody knows when the market will go o it's down cycle (correction) but it WILL happen sooner or later, and it usually happens after hysteria.
 
Geyser
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Re: Vancouver Housing Market Implodes:

Fri Aug 26, 2016 3:28 pm

VanBullBear wrote:
It's hilarious how we have so many permanent bulls who think prices can go up forever...
EVERY MARKET CYCLES.

The market is designed as a negative feedback loop, if there is too much demand against the supply the price increases. The increases will dampen the demand because it filters out the buyers who are not willing to pay until the market is balanced again. The same goes for price going down (the market will find more buyers). What perma-bulls fail to realize that this process takes time. This isn't the stock market where you can place a market order and have your position filled in a matter of seconds - it can take months to do the transaction.

Just because the prices have been going up for years it does not mean it can go on doing so forever. - THE REAL ESTATE MARKET CYCLE IS INHERENTLY SLOW.
Nobody knows when the market will go o it's down cycle (correction) but it WILL happen sooner or later, and it usually happens after hysteria.

Agreed, however it's interesting to note that two of Vancouver's previous home price collapses were sudden and spectacular. I'm thinking a slow leak might be less disruptive but that kind of correction can take decades so it might be less damaging to just take one big hit and a decade or two of zero growth. As you say, nobody knows when the down cycle will begin but there are some interesting signs that at least in the SFH market it may have already started. Time will tell.
In fond memory of Taipan, a model of modesty, decency, dignity and tolerance. Long may we all prosper from the tremendous legacy of worldly wisdom and specialized real estate knowledge which he left in the "Arguments" thread.
 
tdma800
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Re: Vancouver Housing Market Implodes:

Sun Aug 28, 2016 8:59 am

Probably not funny however so many temporary residents assume sales and cost can't move to the moon for all time. Things are different here. Its a new normal.   Things have been doing it for a while and that means its posssible to do it a long time with rapid movements
 
reallyreal2
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Re: Vancouver Housing Market Implodes:

Fri Sep 02, 2016 6:58 pm

Geyser wrote:
VanBullBear wrote:
It's hilarious how we have so many permanent bulls who think prices can go up forever...
EVERY MARKET CYCLES.

The market is designed as a negative feedback loop, if there is too much demand against the supply the price increases. The increases will dampen the demand because it filters out the buyers who are not willing to pay until the market is balanced again. The same goes for price going down (the market will find more buyers). What perma-bulls fail to realize that this process takes time. This isn't the stock market where you can place a market order and have your position filled in a matter of seconds - it can take months to do the transaction.

Just because the prices have been going up for years it does not mean it can go on doing so forever. - THE REAL ESTATE MARKET CYCLE IS INHERENTLY SLOW.
Nobody knows when the market will go o it's down cycle (correction) but it WILL happen sooner or later, and it usually happens after hysteria.

Agreed, however it's interesting to note that two of Vancouver's previous home price collapses were sudden and spectacular. I'm thinking a slow leak might be less disruptive but that kind of correction can take decades so it might be less damaging to just take one big hit and a decade or two of zero growth. As you say, nobody knows when the down cycle will begin but there are some interesting signs that at least in the SFH market it may have already started. Time will tell.


Some people assume the market only goes up.

Other think that silly factors like lack of land, immigration, livability etc are the reason are RE is sky high. Well nothing has changed this past month but we are down 20% in a month!

So did we find new land? Immigrants stopped? Livability down?

What happened?
 
eyesthebye2
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Re: Vancouver Housing Market Implodes:

Fri Sep 02, 2016 7:57 pm

Huh?
I checked the data
E Van up .4%
Van W up .7%

20% might be sales volume, but i dont see much cheaper sales prices
 
danny
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Re: Vancouver Housing Market Implodes:

Sat Sep 03, 2016 3:55 am

It's almost like REBGV wrote this directly to Garth and Geyser :

“In aggregate, we continue to see an imbalance between supply and demand in most communities. However, we’re also seeing fewer detached sales in the highest price points and fewer detached home sales relative to all residential sales,” Morrison said.

“This is causing average sale prices to show a decline in recent months, while benchmark home prices remain virtually unchanged from July.”

But but, I want a 20% discount on this specific house because Garth and Geyser told me prices are down 20%.

Look I know sales are softening along with prices, but please just quit being so dishonest with the sensationalism.
 
Geyser
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Re: Vancouver Housing Market Implodes:

Sat Sep 03, 2016 3:17 pm

I'm assuming that the last two posters didn't read my post on this subject yesterday, so here it is again:

pm

[size=150][font=Arial, Helvetica, sans-serif]Here is some more information and some very interesting MLS numbers and charts posted by another very well established local realtor. I read this guy's blog regularly, mostly because it has valid information and he very rarely triggers my BS radar. He seems to be a sincere straight-shooter who avoids industry "spin".

http://www.yattermatters.com/2016/09/government-fiddle-burns-vancouver-real-estate/#more-40325

It's worth following the link for the full post, but here's a teaser:


"In July 2016 the average price for a Vancouver detached was recorded at $1,764,682. In less than a month (post Tax proclamation), the average price gain over the year of approximately $300,000 has been wiped out. August 2016`s average price for a detached home flat lined at $1,470,265 to settle below August 2015`s average price of $1,474,475."[/font][/size]

[font=Arial, Helvetica, sans-serif]Which part of "my" post did you find "dishonest"?[/font]
In fond memory of Taipan, a model of modesty, decency, dignity and tolerance. Long may we all prosper from the tremendous legacy of worldly wisdom and specialized real estate knowledge which he left in the "Arguments" thread.

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