REVscene - Vancouver Automotive Forum


Welcome to the REVscene Automotive Forum forums.

Registration is Free!You are currently viewing our boards as a guest which gives you limited access to view most discussions and access our other features. By joining our free community you will have access to post topics, communicate privately with other members (PM), respond to polls, upload content and access many other special features. Registration is fast, simple and absolutely free so please, join our community today! The banners on the left side and below do not show for registered users!

If you have any problems with the registration process or your account login, please contact contact us.


Go Back   REVscene Automotive Forum > Automotive Chat > REVscene Nation: Beyond The GVRD > Island Off-Topic

Island Off-Topic "Must you always talk about cars?" Not in here.
For other things in life..

Reply
 
Thread Tools
Old 07-04-2008, 10:47 AM   #1
Where's my RS Christmas Lobster?!
 
Darb 2k's Avatar
 
Join Date: Apr 2005
Location: victoria
Posts: 846
Thanked 0 Times in 0 Posts
Real Estate Downturn?

Saw this posted a work. Interesting.

Thoughts?

Came across this site which you may want to check out if you are thinking of buying (or selling) real estate in the next while.

http://www.greaterfool.ca/ (MP Garth Turner's book site)

Here's a Victoria-specific letter and response I found interesting:

Hello Garth,
It’s been many years since we last spoke about the time you returned
to government, but I wanted you to know how well received Greater
Fool is out here in Lotus Land. Well, at least by me. I hadn’t
finished the first chapter when I called down to Bolen Books and had
them set aside additional copies for each person in a group I meet
with to discuss investments. You’ve put into clear language what I’ve
been trying to tell people for some time now. Hopefully with your
background to back it up, the words will carry further and with more
weight. I’m even hoping that after reading her copy my mom will be
able to shake herself out of her lifelong fixation on her house.

The sad thing is there are many who will grudgingly admit that what
is happening in the US *might* happen to the rest of Canada, but
*surely* won’t happen here in Victoria. This has added gasoline to
many people’s desire to buy, even in the face of increasing
inventories and stagnant sales.

The unfortunate quandary for people like myself is that for a mid-
thirties, recently divorced, working stiff it looks like *all* the
options are poor ones at this point. Affording a traditional mortgage
on a single self-employed income is prohibitive, renting anything
affordable has far too many restrictions (no pets, no gardens, etc),
the new mortgage options seem to have more downsides than ups for the
person paying the bill, and it’s looking to get worse as costs
continue to increase across the board due to Olympic Inflation while
wages lag.

Thank you for your time, and all the advice over the years.
Cheers,
Scott

--

Yes, delusional thought seems to be a by-product of living in
Victoria. Granted, it is a jewel, with lots of cultural stimulation,
an enviable climate, wondrous geography, a quaint way of life,
government stability and memorable architecture. All that supports
local real estate and has resulted in a premium for houses located in
the region.

However, you must remember that affordability levels have plunged as
prices increased, and with the inevitable economic downturn gripping
the national economy, this problem will be exacerbated. The second
major concern is that Victoria’s relatively small population demands
a sizeable net inflow of people in order to sustain real estate
values. Those people – buying homes worth an average of over $600,000
– need to dispose of real estate in other regions, usually Ontario,
before they can buy over-priced digs on the island. But the market is
falling apart back East, and the disintegration will only pick up
speed over the next year. Conclusion: Victoria prices now have just
one direction in which to travel. And anyone buying in the next 12
months will, unfortunately, regret it. The phrase, ‘greater fool’
charges to mind.


From: http://www.greaterfool.ca/2008/04/12...nt-into-heloc/
Advertisement
Darb 2k is offline   Reply With Quote
Old 07-04-2008, 11:21 AM   #2
Even when im right, revscene.net is still right!
 
Join Date: Apr 2004
Location: Da Island mon!
Posts: 1,310
Thanked 1 Time in 1 Post
The stupidity has to end at some point... you need six figures of income to buy anything that you could raise a family in, and I dont think the median income in Victoria is anywhere near that.

Watch high end condo prices and the more expensive houses with no good reason for being expensive (Bear Mountain), they'll be the first hit.
__________________
2002 GMC Envoy SLT - Mmm... Heated leather.
2000 Chevrolet Cavalier Z24 - The built, bottled, and extremely obnoxious race car err lawn ornament.
2003 Saturn Ion-2 Sedan - Wife's daily driver.
1965 Chevrolet Nova SS - BBC powered gasser in the making.
1963 Acadian Beaumont Convertible - My silver on red baby.
ostampflee is offline   Reply With Quote
Old 07-04-2008, 11:28 AM   #3
Where's my RS Christmas Lobster?!
 
Darb 2k's Avatar
 
Join Date: Apr 2005
Location: victoria
Posts: 846
Thanked 0 Times in 0 Posts
I hope so. Gives us Low-Mid class people some hope of buying.

Listings have increased greatly over the last month.
Darb 2k is offline   Reply With Quote
Old 07-04-2008, 11:38 AM   #4
My dinner reheated before my turbo spooled
 
Hickman's Avatar
 
Join Date: Dec 2003
Location: Parksville
Posts: 1,732
Thanked 0 Times in 0 Posts
yeah i her about this as well. i hear ruffly taht houses will be droping 15-20 K in the next 8 monthes.
__________________
Jay
2002 Mazda Protege 5
1987 Mazda Rx-7 TII (Sold :( )

Quote:
Originally Posted by ChrisStang View Post
Meh, if my car comes back not on fire after my wife drives it, I consider it a good day.
Quote:
Originally Posted by Super WOP View Post
Heavy is the opposite of light.

I'll get you some crayon and paper and draw it out for you if its too complex.
Hickman is offline   Reply With Quote
Old 07-04-2008, 12:54 PM   #5
Head Mod yo
 
Victoria SiR's Avatar
 
Join Date: Feb 2000
Location: 250
Posts: 8,803
Thanked 7 Times in 4 Posts
Pretty much the main reason I have been waiting.
Victoria SiR is offline   Reply With Quote
Old 07-04-2008, 01:04 PM   #6
My dinner reheated before my turbo spooled
 
Hickman's Avatar
 
Join Date: Dec 2003
Location: Parksville
Posts: 1,732
Thanked 0 Times in 0 Posts
Quote:
Originally Posted by Super WOP View Post
Pretty much the main reason I have been waiting.
/agree

10 char....
__________________
Jay
2002 Mazda Protege 5
1987 Mazda Rx-7 TII (Sold :( )

Quote:
Originally Posted by ChrisStang View Post
Meh, if my car comes back not on fire after my wife drives it, I consider it a good day.
Quote:
Originally Posted by Super WOP View Post
Heavy is the opposite of light.

I'll get you some crayon and paper and draw it out for you if its too complex.
Hickman is offline   Reply With Quote
Old 07-04-2008, 01:59 PM   #7
Sick motherfucker mod
 
rental_metard's Avatar
 
Join Date: Mar 2002
Location: Victoria
Posts: 9,084
Thanked 56 Times in 40 Posts
I'm hoping for it. Some houses here i saw were way too expensive for their size / local. Their was a house for 700k like two blocks from $$$$$$$$. Fuck that.
__________________
Quote:
Originally posted by stevo911_
In this part of the world, the italian, the darkie, and the perv have total control.... scary eh?
rental_metard is offline   Reply With Quote
Old 07-04-2008, 02:46 PM   #8
I subscribe to the Fight Club ONLY
 
MidnightMechanic's Avatar
 
Join Date: Mar 2002
Location: The Lab, in VI
Posts: 7,043
Thanked 0 Times in 0 Posts
Its already happening. A friend of mine's parents had their house up, just dropped the price $20k to get more interest. It will turn into a buyer's market in no time.
__________________
ANDO

"Some people like to have sex, some people like to get drunk and pass out of the couch. To-mato tom-ato." Slammedcivicsi
MidnightMechanic is offline   Reply With Quote
Old 07-04-2008, 02:49 PM   #9
RS controls my life!
 
Vette Dood's Avatar
 
Join Date: Aug 2002
Location: Victoria
Posts: 738
Thanked 26 Times in 12 Posts
If you look at the housing market historically (in Victoria) over the last 40 years, there is a very clear trend with how the market changes. There has been almost the exact same trend 3 times now. Property value maintains a constant value for 7 to 10 years, then over the course of 3 to 5 years it will double in value. Towards the end of the doubling period there is a small dip of 5 to 10% before it flattens out and repeats itself on teh same cycle. If you look at the pricing in the market, we are just coming to the peak of that doubling phase. If you look at the properties on the market, it is a good indicator that that hump is being crossed and there will be a downward shift over the next 12months. There is more property currently on the market then there has been in like 7 years. Every month there is less being sold. The Victoria Real Estate Board has very good published statisics if you want to take a look for yourself. While no one can predict the future, I would say the likely hook of atleast a 2 to 3% drop is high, and a good change of a few more points beyond that. In a market where a house will run you 500 large, 3% is a nice size of change. For those that think your average starter home is going to drop down $200k, I have news for you... people are going to still expect to pay over $400k if not more for a starter home, but I feel there is still a bit of time before the market is just right to buy in. Another indicator is new condo developments. There are several in the city (Dockside Green, Reflections..) that can't continue development do to lack of pre-sales. This is a great indicator of the bottom side of the market going down, and that will suck in all the other prices. For anyone holding out in a 50% reduction in housing prices, good luck - it won't happen. If you want to save your self $25 - $30k I'd bank on buying in Q4 2008 / Q1 2009.

Another thing to keep in mind is that waiting to save that few extra thousand may end up burning you on interest rates. No one can predict the rates, but there are a lot of people floating variable rate mortgages. There are also alot of talk and fear rates are going to go up. This is starting to cause a shift from variable to fixed rates. One thing you can count on is the banks taking advantage of the demand and bumping the rates up of a fixed rate mortgage. Some lenders are already trending this way.

My best bet at this point is to watch the market like a hawk, have all your ducks in a row to get your mortgage. Wait as long as you can, and then get a pre-approval and a rate hold on a fixed rate mortgage before it bumps. Hopefully your lender will guarentee it for 120days, then start to move on houing. That gives you 4 months at todays rates to find a house and for the market to shift a bit further.

Those are my thoughts and plan at this point.

Last edited by Vette Dood; 07-04-2008 at 02:49 PM.
Vette Dood is offline   Reply With Quote
Old 07-04-2008, 03:07 PM   #10
RS.net, helping ugly ppl have sex since 2001
 
Great68's Avatar
 
Join Date: Mar 2002
Location: Victoria
Posts: 8,500
Thanked 2,593 Times in 845 Posts
Well, Phase 3 of Dockside Green has been put on hold because they haven't sold all the units from Phase 2 yet.

That's not a good sign, the whole Dockside Green site is supposed to be 10 phases, 1000 units when all done, and they're having trouble selling their 250th unit.

Of course, $350K for 600sq ft is a freaking rip off, even for the location and all the frilly "Green" things that place has to offer. These condos are no "starter homes".

I guess it only appeals to the trendy urban greenie weenie, latte sipping, beret wearing, haiku writing motherfuckers.

I didn't buy right when I moved here because I bet on prices dropping. I'm happy it might be actually happening.
__________________
1968 Mustang Coupe
2008.5 Mazdaspeed 3
1997 GMC Sonoma ZR2

A vehicle for all occasions

Last edited by Great68; 07-04-2008 at 03:28 PM.
Great68 is online now   Reply With Quote
Old 07-04-2008, 03:50 PM   #11
Rs has made me the man i am today!
 
sixthgear's Avatar
 
Join Date: Apr 2001
Location: Victoria
Posts: 3,336
Thanked 2 Times in 2 Posts
prices come down, rates go up. Best to see if you come out ahead with this "down turn". Personally, we are still going forward with building a new house. Our house may "drop" 15-20K, but it is still way higher than what we paid for it.
__________________
*2003 White Ford F350SD XLT Crew Cab Diesel
*1972 Ford Gran Torino Sport (351C)
sixthgear is offline   Reply With Quote
Old 07-04-2008, 03:54 PM   #12
Head Mod yo
 
Victoria SiR's Avatar
 
Join Date: Feb 2000
Location: 250
Posts: 8,803
Thanked 7 Times in 4 Posts
If rates aren't in the equation the situation changes.
Victoria SiR is offline   Reply With Quote
Old 07-04-2008, 04:12 PM   #13
I subscribe to the Fight Club ONLY
 
Enraged's Avatar
 
Join Date: Jan 2002
Location: Victoria, BC
Posts: 7,111
Thanked 15 Times in 8 Posts
historically, variable rate mortgages cost less, but there is, obviously, a risk. I'm looking at buying in Q1 2009, so I have been watching all of the listings on mls. more and more are being relisted at lower prices.

it's good to see there are like-minded people in Victoria who realize that $300k for a 650 sqft 1 bedroom condo is not a good deal...
__________________
88 Toyota Supra Turbo.... maybe ready to drive soon.
05 Subaru Legacy GT - for sale
04 Volvo V70R
Enraged is offline   Reply With Quote
Old 07-04-2008, 04:16 PM   #14
RS controls my life!
 
Vette Dood's Avatar
 
Join Date: Aug 2002
Location: Victoria
Posts: 738
Thanked 26 Times in 12 Posts
In my opinion, rates are always in the equation. Even if I had enough money to flat out buy a house I wouldn't. Id spread it across 20% down on as many houses I could that had a 2bdrm suite, mortage 80%, double rent the property and have the two suites pay off the mortgage for you. Thats just one option though.. with the market topping off, and lots of money to play around it may be more cost effective to use the large sum of cash to invest else ware for a 'lower' risk investment, but a higher return then would be payed in mortgage rates. Then either rent a full house or put 20% down to cover the mortgage and pay the interest rates on the principal. There are good reasons why investors don't think property is a good / safe investment and would rather rent then pay a mortgage and invest money into something with higher / safer return. There are plenty of places that are moderate risk to dump money into with 12% dividends, I don't think property is going to get that kind of pace anymore.

Last edited by Vette Dood; 07-04-2008 at 04:23 PM.
Vette Dood is offline   Reply With Quote
Old 07-04-2008, 04:19 PM   #15
RS.net, helping ugly ppl have sex since 2001
 
Great68's Avatar
 
Join Date: Mar 2002
Location: Victoria
Posts: 8,500
Thanked 2,593 Times in 845 Posts
Quote:
Originally Posted by Enraged View Post
it's good to see there are like-minded people in Victoria who realize that $300k for a 650 sqft 1 bedroom condo is not a good deal...
You couldn't even fit a queen sized bed in the Master Bedroom of a typical suite at Dockside.

And if only people could see how shitty these things were actually built (Like I have), they'd be running away...
__________________
1968 Mustang Coupe
2008.5 Mazdaspeed 3
1997 GMC Sonoma ZR2

A vehicle for all occasions
Great68 is online now   Reply With Quote
Old 07-04-2008, 05:22 PM   #16
Sick motherfucker mod
 
rental_metard's Avatar
 
Join Date: Mar 2002
Location: Victoria
Posts: 9,084
Thanked 56 Times in 40 Posts
Quote:
Originally Posted by Great68 View Post
I guess it only appeals to the trendy urban greenie weenie, latte sipping, beret wearing, haiku writing motherfuckers.
dottie ?
__________________
Quote:
Originally posted by stevo911_
In this part of the world, the italian, the darkie, and the perv have total control.... scary eh?
rental_metard is offline   Reply With Quote
Old 07-04-2008, 05:34 PM   #17
Rs has made me the man i am today!
 
sixthgear's Avatar
 
Join Date: Apr 2001
Location: Victoria
Posts: 3,336
Thanked 2 Times in 2 Posts
Quote:
Originally Posted by Super WOP View Post
If rates aren't in the equation the situation changes.
Yes, if you paying for it 100% up front then interest rates are not in the equation. Sadly, 99% of buyers aren't in the situation to pay for a new place all at once. A small change in the rate can sometimes be the difference between someone affording a place and not affording it. Personally though, if you can't take a change in the rate, you shouldn't be looking at a place worth that much.
__________________
*2003 White Ford F350SD XLT Crew Cab Diesel
*1972 Ford Gran Torino Sport (351C)
sixthgear is offline   Reply With Quote
Old 07-04-2008, 05:59 PM   #18
RS controls my life!
 
Vette Dood's Avatar
 
Join Date: Aug 2002
Location: Victoria
Posts: 738
Thanked 26 Times in 12 Posts
Quote:
Originally Posted by sixthgear View Post
if you can't take a change in the rate, you shouldn't be looking at a place worth that much.
Example: USA
Vette Dood is offline   Reply With Quote
Old 07-04-2008, 06:12 PM   #19
RS Veteran
 
TouringTeg's Avatar
 
Join Date: Nov 2001
Location: An Island
Posts: 13,365
Thanked 3,077 Times in 682 Posts
I don't think there is anyway rates can stay as low as they are. Interest rates will need to be rasied to slow down the inflation rate. With gas and food prices skyrocketing and a slowing economy worldwide there aren't as many buyers. I agree that we aren't going to see anything crazy like houses under 300k. Victoria is still very desirable and boomers are looking to retire somewhere nice.

We bought our condo in Q4 07 and are happy. We plan on keeping it and renting it out and buying again. We were considering buying again earlier this year but it was clear prices were going to start coming down.
TouringTeg is offline   Reply With Quote
Old 07-04-2008, 06:37 PM   #20
Head Mod yo
 
Victoria SiR's Avatar
 
Join Date: Feb 2000
Location: 250
Posts: 8,803
Thanked 7 Times in 4 Posts
Quote:
Originally Posted by sixthgear View Post
Yes, if you paying for it 100% up front then interest rates are not in the equation. Sadly, 99% of first time buyers aren't in the situation to pay for a new place all at once. A small change in the rate can sometimes be the difference between someone affording a place and not affording it. Personally though, if you can't take a change in the rate, you shouldn't be looking at a place worth that much.
Fixed for accuracy.
Victoria SiR is offline   Reply With Quote
Old 07-04-2008, 06:40 PM   #21
Rs has made me the man i am today!
 
sixthgear's Avatar
 
Join Date: Apr 2001
Location: Victoria
Posts: 3,336
Thanked 2 Times in 2 Posts
Quote:
Originally Posted by Super WOP View Post
Fixed for accuracy.
Not really. I am a 3rd time buyer and I don't have 100% to put down.
__________________
*2003 White Ford F350SD XLT Crew Cab Diesel
*1972 Ford Gran Torino Sport (351C)
sixthgear is offline   Reply With Quote
Old 07-04-2008, 07:29 PM   #22
dustinb
Guest
 
Posts: n/a
I bought my house when I was 22. 8 years later it's worth ... 4 times more. And guess what, when I bought it for $130,000, it was just as tough as it is now to get money. Banks were WAY less likely to give money out to people, and interest rates were significantly higher. We couldn't get over $150,000 from the banks, and my wife and I both had very good income and a large down payment. So even if prices drop (especially because of economy), then interest rates are going to go up and banks aren't going to give money out.

On another note, but I want houses to stay as expensive as possible. It's not that I don't want you guys to get houses, but equity is king and it really has given me financial freedom. However, I can also see not wanting to get into a $400,000 mortage. Especially if the markets do crash and interest rates go through the roof.
  Reply With Quote
Old 07-04-2008, 07:44 PM   #23
I answer every Emotion with an emoticon
 
Black SC2's Avatar
 
Join Date: Dec 2003
Location: Langvista
Posts: 7,936
Thanked 73 Times in 19 Posts
This may be weak advice, but it helped her ladyship and I a tonne when it came to purchasing our house; get something with a mortgage helper in it. Having the rental income allowed us to get into a house size/ locale that we otherwise couldn't afford, and will also help us ride out potential rough times ahead. There seems to be a fair bit of land zoned as R2, so if you're looking around, keep those areas in mind. Illegal suites can be more trouble than they're worth, and you can't claim the potential rental income when it comes to shopping for a mortgage.
__________________
Time flies like an arrow. Fruit flies like a banana.
Black SC2 is offline   Reply With Quote
Old 07-04-2008, 10:08 PM   #24
RS.net, helping ugly ppl have sex since 2001
 
Great68's Avatar
 
Join Date: Mar 2002
Location: Victoria
Posts: 8,500
Thanked 2,593 Times in 845 Posts
Quote:
Originally Posted by Black SC2 View Post
This may be weak advice, but it helped her ladyship and I a tonne when it came to purchasing our house; get something with a mortgage helper in it. Having the rental income allowed us to get into a house size/ locale that we otherwise couldn't afford, and will also help us ride out potential rough times ahead. There seems to be a fair bit of land zoned as R2, so if you're looking around, keep those areas in mind. Illegal suites can be more trouble than they're worth, and you can't claim the potential rental income when it comes to shopping for a mortgage.
Werd.

Mortgage helpers helped my cousin buy a $550K house as his first home. Granted the house needs A LOT of work, but he's a journeyman carpenterso for him it's easy. Houses with legal suites already built into them are hard to find though. I know when I was looking for a place to rent only a few of them turned out to be fully legal.
__________________
1968 Mustang Coupe
2008.5 Mazdaspeed 3
1997 GMC Sonoma ZR2

A vehicle for all occasions
Great68 is online now   Reply With Quote
Old 07-05-2008, 02:56 AM   #25
I answer every Emotion with an emoticon
 
Nightwalker's Avatar
 
Join Date: Sep 2002
Location: Van Isle
Posts: 7,653
Thanked 443 Times in 188 Posts
Good time for this thread, I have an appointment with my loan officer to discuss this on Tuesday. I'm looking now but probably won't be after anything till 4th quarter, or 1st quarter 09.
__________________
Quote:
Originally Posted by MajinHurricane View Post
who would ban me? lol. Look at my post count.
Nightwalker is offline   Reply With Quote
Reply

Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are Off



All times are GMT -8. The time now is 09:22 AM.


Powered by vBulletin® Version 3.8.7
Copyright ©2000 - 2017, vBulletin Solutions, Inc.
SEO by vBSEO ©2011, Crawlability, Inc.
Revscene.net cannot be held accountable for the actions of its members nor does the opinions of the members represent that of Revscene.net