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3 years for a return to fundamentals eh. |
Hey 444...is this your blog? Book and Weblog ? Authored by Garth Turner ? Greater Fool ? Authored by Garth Turner ? The Troubled Future of Real Estate This guy is a realist on real estate, but its nice that he's calling real estate boards out for their bullshit. Spoiler alert! They lie. |
I like Garth Turner but although I agree that condos are going to tank, I don't agree with the amount of % decline for SFH as he is projecting. Plus he caters to people who are old or with families... if you are young, take more risks instead of ETF's and preferred! Not saying shove it all into individual stocks/gold but allocate more of your % into risk. |
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i do like the amount of information he gets re: real estate and all the BS that goes with it, he is a great source for up to date information |
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unless you have hundreds of thousands of dollars, etfs are the best way to go - most of us don't have the time or the expertise to invest wisely in individual stocks - i feel i have hte latter, but not the former, hence i only invest in longer term investments, mostly through ETFs - if i didn't work for a living, i'd be in a different situation, but i enjoy utilizing my free time to do fun stuff, not review financials and read articles all the time |
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just give it time here, people in the US didn't think they could see a bubble either, now our mindset is that US housing is 'cheap' - it's not cheap, it's about long term normal... Canada is just out of whack, hindsight is 20/20 and we will sit back in a couple of years and say 'oh ya, why would anyone spend over a million bucks on a 50's build shit hole in east van? it's worth maybe $300-400K at most' long term, real estate is valued based on income, both personal income and rental income (those two usually move lock step - have we not noticed that personal incomes aren't moving in Vancouver, nor are rental prices, yet housing prices have gone up ever since 2003 - 2003, the year rates started coming down and the government eased up on lending requirements... am i the only one seeing this?!) |
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Official statistics don't capture the class of immigrants who don't work but bring over millions in cash. It's not just the Chinese, the Saudis are here too especially if you spend time downtown - the number of covered up women with kids is plainly evident. Of course, drug dealers who prefer to rent newer buildings can easily keep the condo market afloat too. My building was heavily invested by first-time homeowners who rented their suites out to dubious tenants. Posted via RS Mobile |
And now we're talking rentals..and that's now where I can speak to. In my mind, the worst thing that happened to the condo market was the investor class. You can have a person that puts down their %5-20%(more the 5ers) and buys into a box. They say yay! no more renting! Living next to trash. Then they meet their neighbor. He is either a drug dealer(Van) or a drug user(surrey) We rent out our townhouse. Guess who lives in the block behind? A Bacon. Why? What has Gridlock railed against on rs(and others)? Amateur frigging landlords that don't get it. Oh he looks delightful! look! He brought a pocket full of cash...so rent won't be an issue. Joy. The rental market is softening out here in the 'burbs. Don't quite know why yet. Everyone going out to Surrey? Mom's basement? Maybe the other way...Vancouver is getting cheaper so they are going in. It has been getting a bit more difficult to rent out stuff. So quality of person is down a smidge, as is rent. |
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if you think about it, consider arizona, las vegas, florida after the downturn - they are what people think vancouver is today, with investors buying up all the property and affecting the price - does not happen. prices in those places tanked, something like 50%+ of sales were to investors out of state (huge number were canadian, including myself) - guess what, prices stabalized, but the real ramp up in prices (from HUGELY below long term average, and hugely below cost to rebuild) was driven by locals who now have the confidence and ability to buy properties again. look at california - prices are really high there, it's locals. the number of investors in the US are decreasing relative to locals as prices go up and yields have become unattractive, risk adjusted - this is the case for me. as for drug dealer renters, and i am by no means an expert, but drug dealing is like any business, as is being a gangster - the top 'executives' make all the money, they'll be the flash ones in nice houses paying for everything in cash (until they go to jail or get killed) - but all the drug pusher foot soldiers still live at home with their mum's because they make no money. drug dealers won't ever have any material effect on the rental market. again, 99% of the attraction in news articles/media, 1% of reality |
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We don't know if it's 1% or 99% because no one actually collects statistics on RE purchaser demographics. But, the odds are that it's more than 1% of the RE market. On the other hand, your typical foot soldier drug dealer makes enough money to survive: rent on a new condo, lease payment for that Range Rover, money for 40s of Grey Goose, meals at Cactus/Joey, etc. They can't save their money, so they spend it all toys and lifestyle. I used to work for one of the chains and I would see it all of the time in my neighbourhood. Posted via RS Mobile |
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You saw one, maybe two guys that were actually in industry. You saw 30 guys that like to LOOK like they are in the industry. It's Vancouver...looking the part IS the part. |
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Pick of the week. REALTOR.ca -Property Details V998455 Bit of a fixer, but listed at a steal. Tell me realtors of the land, tell me that now is the time to buy Vancouver houses. Edit...looked into it further, and this is down the road for 75k more, so I don't know what kind of crack the owners of house #1 are smoking. http://www.realtor.ca/propertyDetail...Key=1302252640 |
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I hate the ppl in this city sometimes for their stupidity, but they will cry as they're in mortgages (not houses) they can't afford |
Why? As an investor, I prefer having sheep around. I have plenty of patience. Do you guys check the foreclosure list that is posted at BC Law courts every morning? The 2 listings are not that insane though.. it is in Mt Pleasant.. A "hipster" / desirable/ switching to high density area of Van West. I would say too bad the first one is short 8 foot width. It will be insane if people will fix it up, they should tear down for high density... What is insane is places in East Van.. Rupert etc asking for the same price. Quote:
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And no crying...they'll get bailed man. Sales numbers are down. We're being told that this is "cyclical" or "returning to normal" but prices are remaining at their levels. I don't know about you all, but if things aren't selling as much, isn't the next reality to sell for less when that happens? My prediction, based on a bunch of hunch is that what I'm noticing now, which is a lot of sales in my area of detached homes represents that last push. People wanting out soon, are getting out now. People that have been waiting see the low interest as their reason to jump in. Here in New West, we're a bit of a value proposition, so people come out a little further to make affording it possible. That's my theory anyway. |
OH and PS. Was driving down Marine tonight past the Marine Gateway project by the Canada Line. Totally smelled like hot sweaty trash, so congrats to the fine folks that bought into Rennie's concrete wetdream there. That's alright, just ask the guys in New West that bought condos next to train tracks how well moving them went :) |
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The second property is 56x65, wider than normal, but quite shallow (and less area than a standard lot). I bought a POS house on a 32x122 lot near Langara in May 2012 for just under $1M... :okay: I'm in the process of building a new house (around $600K), so the finished product will cost me $1.6M in total. This will be my primary residence though. |
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**edit, sorry and yes. I didn't get into the specifics on finding a comp for the first house. I just saw a house of similar style and bedroom count. Obviously you get more land on the first deal, which is the value driver. |
With Bernanke and BoC's indication.. it will look like cheap credit will be around till 2014.. I say 2015 because that's election year.. I am sure the PC would only worry about the bubble after that (or burst it if other parties get into power). So looks like there is still 2 years to play. |
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I bought a a house 33x99 in the collingwood area in 09 for under $600 in 2009 and i was complaining it was too much :lol Quote:
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There are so many variables.. like if you want a coach house etc? Quote:
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Go look at open houses in Vancouver West and Vancouver East, and you'll notice a huge difference in quality of materials, style, and expectations. For example, west side houses will have 10' ceilings on the main floor, theatre rooms and wet bars in the basement, and rentable basement suites will be an afterthought. A house on the east side won't have the super high ceilings, and the basements are almost always built with 1 legal 2-br suite, and another not-so-legal suite. With that said, you would never build a "basic" house in the west side. My house is on the borderline, just west of Main, so it would pale in comparison to a west side house. However, it would probably be one of the nicer east side houses. If you could categorize Vancouver houses as basic, custom, and luxury, I would put myself in the middle category. PM me if you want more details. Edit: I don't think your 33x99 lot qualifies for a laneway house - which would cost an extra 100-200K. And 10 years ago, you could probably build a brand new 3-level house for $300k. Sadly, construction costs have risen... |
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