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Vancouver Off-Topic / Current EventsThe off-topic forum for Vancouver, funnies, non-auto centered discussions, WORK SAFE. While the rules are more relaxed here, there are still rules. Please refer to sticky thread in this forum.
I see several possibility (for people to only sink 20-30% of their after tax income on housing:
1) RS folks are all ballers that rank in massive amount of dough
2) they bought before prices skyrocketed
3) they are not buying $1M properties (ie. single detached homes). Instead, they are buying duplexes, town homes, apartments, etc. Out in Surrey, it is still entirely possible to spend only $150k-ish on a 500-ish square fee 1 bedroom suite.
ur exactly right in Vancouver.
1) not likely unless you own your own successful business (this place is built for small business owners, not employees)
2) yup
3) and yup.
That's why the rent vs. own costs are so interesting, if you're renting at more than 3x% of take home pay, you're living above your means, yet this somehow doesn't apply for owned real estate - i find that odd.
Been house shopping for the past 5 months. Flying back from HK every month or so looking at houses and putting down offers. Seeing asking prices $300k-$400k over 2014 assessment and still getting sold. Getting outbid by fuckers going $100k-$200k over asking price with zero subjects.
This is really getting stupid for a place that practically doesn't have an economy and sustainability. I love everything about Vancouver but damn, its really getting played out and its quite obvious which group is doing this.
Even with a $2m budget (after build) I can't find anything I like with a good sized land in Richmond. I just can't afford to play this crazy game. Wife and I decided to wait it out and watch the market adjust. We're willing to wait another 3-5 years if that's what it takes. I'm in no rush to buy a place, just in a rush to move back for my kid so he gets a "normal" education.
The second one is over your budget but you may be able to talk then down to 2M. Those are just two of the many new builds I drive by every day that have been on the market for 6+ months.
You'd think that if investors are just parking their money here, they'd be snatched up ASAP regardless of location no?
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"Damn fine car Dodge... Ran over me wife with a Dodge!", Zeke
The second one is over your budget but you may be able to talk then down to 2M. Those are just two of the many new builds I drive by every day that have been on the market for 6+ months.
You'd think that if investors are just parking their money here, they'd be snatched up ASAP regardless of location no?
Man what was the architect thinking, the second house is literally a box. I can design a better house in The Sims.
NKC is going custom, no house will change his mind. He just need a good chunk of land.
Thanks guys...and yes it has to be in Richmond, preferably in the Seafair area. Its where my wife and I grew up and we'd love to raise our kids there. I'm looking to build so a tear-down is fine but land has to be a minimum of 8000sqft. I'd have to allocate about $800k +/-$100k for the build.
I've seen about 50+ houses in the past couple months and have put down offers on 5. I feel a lot of urgency when I'm there as if this is the last chance to buy a house. I don't like that feeling and I know its overpriced. I have property elsewhere and definitely not house horny. Just want to move my family and dogs back to retire. I'll have to admit that I can't afford a house in Richmond, definitely not at these prices.
^How about Steveson area? There is a lot in that area which hasnt been listed..8000+sq ft lot tear down. If you are interested let me know and I'll pass the message.
^How about Steveson area? There is a lot in that area which hasnt been listed..8000+sq ft lot tear down. If you are interested let me know and I'll pass the message.
Shameless plug, what do you guy think of this company my friends and I started? We plan to use tech to streamline the process of making offers so buyers can get a rebate on the buyer agent commission.
The second one is over your budget but you may be able to talk then down to 2M. Those are just two of the many new builds I drive by every day that have been on the market for 6+ months.
You'd think that if investors are just parking their money here, they'd be snatched up ASAP regardless of location no?
LOL... The house next to the first one is now trying to rent it out. There's a big for rent sign out front. A little background info, it used to be a big lot. It was subdivided and two modern Vancouver Special size houses were put up.
Someone moved into one of them, I have a feeling it was the builder/investor. Boom or bust, there's always someone left holding the bag.
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"Damn fine car Dodge... Ran over me wife with a Dodge!", Zeke
VANCOUVER -- Vancouver is behind other locales around the world in controlling skyrocketing house prices that are being affected by wealthy foreign buyers snapping up local properties, a University of B.C. professor says.
David Ley, a UBC geography professor, said cities such as Hong Kong, Singapore and London have already taken measures to restrict foreign ownership, such as stamp duties — or a transaction tax — in the Asian countries specifically to target non-local investment, and a capital-gains tax on foreign investments in the UK.
In Australia, overseas buyers will face jail time if they purchase homes illegally, and in the state of Victoria they will also be subject to a new tax equal to about three per cent of the purchase price.
The city of Vancouver, meanwhile, has announced plans to create a database of empty houses and condos to determine how much vacant properties contribute to the city’s affordability crisis.
“We aren’t really doing much of anything here at present, which puts us out of phase with most other cities,” Ley said. “As soon as any national group is mentioned, developers and the government say this is a xenophobic problem and we’re not paying attention to it. We need to know more about the investment. Is it coming from the region, the rest of Canada or outside Canada? We know there’s a high level of investment from outside Canada.”
The B.C. and federal governments had little to say about whether they would consider similar measures to what is happening elsewhere. The federal government said it does not speculate on possible policy decisions, while the B.C. government wanted more information to determine which ministry would be responsible.
In Australia, where overseas buyers are only allowed to purchase newly built homes and need the permission of the Foreign Investment Review Board, Prime Minister Tony Abbott announced this week that foreigners buying houses in that country will face jail time if they purchase homes illegally. The move is aimed at tightening scrutiny on overseas buyers at a time when record-low interest rates are driving up Sydney property prices five times faster than wages.
Approved overseas purchases of Australian homes more than doubled to A$34.7 billion ($32.9 billion in Canadian currency) in the year ended in June, mostly to Chinese buyers. House prices in Sydney ranked third among the least-affordable major metropolitan housing markets worldwide, after Hong Kong and Vancouver, according to a report in January by Demographia.
Ley noted Vancouver can likely expect more foreign investment, given Canada’s plunging Canadian dollar. This will continue to drive up the market, he notes, while putting homes even further out of reach of local buyers.
Buyers continued to snatch up homes in Metro Vancouver last month, and realtors are warning that the region’s real estate demand is outpacing the supply.
The number of all types of residential property sales last month was up 37 per cent over April 2014 to 4,179, according to the Real Estate Board of Greater Vancouver. Meanwhile, the number of new listings was down 0.9 per cent compared to a year earlier.
A total of 12,436 greater Vancouver homes are listed for sale on the Multiple Listing Service, down 0.5 per cent from March’s numbers and 19.8 per cent since April 2014.
Ley noted said it will be up to all three levels of government to bring in new regulations, which could mean similar measures to those in London and Hong, or possibly eliminating the property transfer tax for local buyers. Parts of Canada, such as Saskatchewan and P.E.I., already keep tabs on foreign ownership in the Agricultural Land Reserve, he added, and questions if this might be something that can be done on an urban basis.
“What you will be told, from the provincial government, and probably the feds, they are very keen to be part of the global market and don’t want to turn investment away,” Ley said.
Premier Christy Clark had said in February that when the province balances its budget and starts “making a dent on our debt,” it will start knocking down the property transfer tax because “it’s a drain on our economy.”
“Its one thing we can do to try to increase affordability,” she said at the time. “We’re not quite in a position to be able to do that yet but it is absolutely part of our long-term plan to get rid of it because it’s not good for affordability in B.C.”
Ley noted that the measures likely wouldn’t have a significant impact on the economy, noting that despite the limits in Hong Kong, for example, demand for property remains high. “The most likely thing to happen will be a cooling off what is a really hot housing market.”
As housing becomes pricier, Vancouverites are growing more sensitive about foreign influences, wanting to know what their politicians are doing to protect local interests.
The answer, to date, is pretty much nothing.
This, even as Australia’s prime minister has just announced plans to jail foreigners who purchase homes in contravention of that country’s stiff foreign investment rules on property purchases.
Closer to home, former B.C. cabinet minister and co-chair of Vancouver Mayor Gregor Robertson’s 2012 task force on affordable housing, Olga Ilich, says local politicians may not be able to act — even if they wanted to.
(The mixed feelings about action derive from the fact that many of their constituents benefit from and favour foreign property buying.)
Says Ilich: “I don’t think the city can do much without the help of the provincial or federal government, and I don’t think they will step into this willingly, for what they will see as a very localized problem.
“I also don’t think too many politicians want to be accused of racism, which also comes up from time to time.”
During last fall’s municipal election, the idea of taxing vacant properties was raised but subsequently dismissed by Non-Partisan Association mayoral candidate Kirk LaPointe, who said such a strategy would be impossible to enforce.
The city’s Affordable Housing Agency is now “in the early stages” of studying the extent of the problem, says city spokesman Jason Watson.
Bank of Canada Governor Stephen Poloz, during a 2013 visit to Vancouver, told The Vancouver Sun’s editorial board that nothing can be done about foreign ownership; Canada is an open market governed by forces of supply and demand.
The Charter of Rights also may restrict action to limit foreign house buying since coverage extends to anyone stepping on Canadian soil.
Meanwhile, the Charter does nothing to protect rights of locals denied a chance to purchase certain properties marketed exclusively to foreigners.
This happened recently in a sale of $30 million worth of Vancouver property, handled by CBRE Group, a commercial industrial and retail property marketer.
The company announced the sale, noting, “the owners had stipulated to not expose the portfolio to the local Canadian market; as such, we arranged an international marketing campaign and brought the portfolio on the road show.”
The portfolio, says CBRE Group, sold to a foreigner who paid $5 million above market price.
Of course, such stories only increase local anxiety about offshore buyers inflating local property prices.
A 2012 Vancouver Foundation survey by Sentis Market Research revealed that 52 per cent of people think there is “too much foreign ownership of real estate here”.
Among young people, aged 25 to 34 — big first-time homebuyers — 61 per cent held that view.
Among all respondents, 54 per cent agreed that “Vancouver is becoming a resort town for the wealthy”.
I have personally noticed people growing grumpier as prices continue to escalate.
A friend last month buying a Vancouver condominium was annoyed to confront, at the last moment, a competing foreign bidder. As a result, she had to boost her offer by $25,000.
Another friend, living in a detached home in Point Grey, had stern words for a realtor who left him a flyer about strong demand for older homes like his. He wrote the realtor: “I am appalled and disgusted by a marketing tactic that can only add to the toll of destruction in Vancouver’s obscene housing market.”
Directly opposite my Kitsilano property is a neglected-looking vacant lot with an unsightly front yard covered in gravel.
Vancouverites lately have heard about all sorts of property restrictions and taxes being imposed by governments in other hot residential markets, such as Australia’s.
Singapore, Sydney and London have imposed foreign buying restrictions. So, why not here?
It is time for a Vancouver task force to:
• Document the extent of foreign influence here;
• examine the effectiveness of limitations imposed elsewhere;
Interest rates have been low for a long long time, and it's of course a major reason.
But the 20-30% increase in prices since the start of Jan THIS YEAR is not mostly due to low interest rates. it's due to foreign money, and our currency decreasing.
You want a tear down in east van, try $1 million at least.
Anywhere on west side is $2 million just for land. Prices going up on the west side by 30% since January.
low interest rates don't matter when you are competing with people paying cash with no subjects and paying over listing. How many locals have $2 million cash sitting around?
Wasn't the rate cut in January? Would that not have brought higher prices since January?
I'm still not convinced on foreign money. Like I said above, I drive by a lot of properties that have been on the market for months. I've even seen a few up in Edgemont that've been on the market for at least a year. If foreigners are just parking their money, these would've been picked up in no time.
If these foreigners were actual investors, then they'd understand the concept of buy low sell high. Which is why places like LA and Florida are attracting the attention of foreign investors at the moment.
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"Damn fine car Dodge... Ran over me wife with a Dodge!", Zeke
Wasn't the rate cut in January? Would that not have brought higher prices since January?
I'm still not convinced on foreign money. Like I said above, I drive by a lot of properties that have been on the market for months. I've even seen a few up in Edgemont that've been on the market for at least a year. If foreigners are just parking their money, these would've been picked up in no time.
If these foreigners were actual investors, then they'd understand the concept of buy low sell high. Which is why places like LA and Florida are attracting the attention of foreign investors at the moment.
i just used january as a base, i could have said september, as prices have been going up since sept 2014. . .. well technically 2008
Investing is not their main priority. They want to move their money outside of China. And most of these people are no longer "foreigners". Many have become permanent residences in the last few years. But the source of the money is still not from Canada.
The government doesn't want to collect the data, but from people in real estate from land titles offices, landcor, bc assessment, colliers etc, realtors, developers you would see that a lot of the buyers are not local.
I honestly don't understand how people can say it's not foreign money. Almost everyone I know says foreign money plays a huge role. It's a trickle down effect.
I'm not even saying it's a bad thing, as I think it's a good thing. I just want restrictions so it doesn't get out of hand or taxes so that we can capitalize on it better.
So Australia, Singapore and all these other cities have data showing that chinese money is affecting their real estate, so they put restrictions for foreign investment.
Australian politicians are willing to fine and jail people for illegal foreign home purchases. Yet our politicians are to pussy to do anything.
Australia will jail foreigners who purchase homes illegally as the government seeks to slow a surge in house prices, Prime Minister Tony Abbott said.
Sentences may stretch to three years and fines to A$637,500 ($607,000) for illicit buyers, with penalties also on third parties knowingly complicit in violations, Prime Minister Tony Abbott said Saturday in Sydney. The steps are needed to give the public confidence that foreign-investment rules on property purchases are being enforced, he said.
The penalties will tighten scrutiny on overseas buyers at a time when record-low interest rates are driving up Sydney property prices five times faster than wages. A company owned by Chinese billionaire Hui Ka Yan's Evergrande Real Estate Group Ltd. -- which illegally bought a A$39 million mansion overlooking Sydney Harbour -- has sold the site to an Australian citizen, Treasurer Joe Hockey's office said Friday.
"What we want to do is ensure that illegal foreign investment is not unnecessarily driving up prices," Abbott said. "If you don't play by the rules there will be a tough penalty regime in place, and those penalties will be enforced."
Overseas buyers are only allowed to purchase newly built homes in Australia and need the permission of the Foreign Investment Review Board. Approved overseas purchases of Australian homes more than doubled to A$34.7 billion in the year ended June, with China overtaking the U.S. as the biggest source of capital, the board said in its annual report Thursday.
Least-Affordable
Sydney ranked third among the least-affordable major metropolitan housing markets worldwide, after Hong Kong and Vancouver, according to a report in January by Demographia.
Melbourne placed sixth in the report, ahead of London in seventh place. New York ranked 15th, tied with the Western Australian capital of Perth and just behind Adelaide.
In Victoria state, foreigners buying houses will pay a new tax equivalent to 3 percent of the purchase price, the Age newspaper reported Saturday. The measures will raise about A$279 million over four years, the newspaper quoted state Treasurer Tim Pallas as saying ahead of his first budget on Tuesday.
Risks to Australia's economy from property speculation and household debt will be one of the main issues studied by an International Monetary Fund team visiting the country next month, the Australian Financial Review quoted the fund's local mission chief as saying today.
They'll also consider whether the issue should be dealt with using monetary policy or government regulation of loan-to- value ratios, bank capital requirements or risk weightings, the paper quoted the IMF's James Daniel as saying.
Price Gains
House prices increased 15 percent in Sydney and 11 percent in Melbourne over the 12 months to April 30, according to data from CoreLogic RP Data. The median dwelling price in Sydney was A$732,500, the data showed.
Under the new law, individual buyers found guilty of breaching foreign investment rules will face penalties of A$127,500 or three years imprisonment. A higher A$637,500 fine will apply to companies.
Third parties who assist investors in breaching the rules will face fines of A$42,500 for individuals and A$212,500 for companies, according to an e-mailed statement from the prime minister's office.
The government plans to introduce legislation on the measures later this year and ensure the changes are enacted on Dec. 1.
'A Fair Go'
"What we want to do is to maximize the opportunities for Australians to buy a home at the best possible price," Abbott said. "We want people to be absolutely confident that local people are getting a fair go."
Abbott declined to comment on a report in the Australian newspaper today saying the government would introduce changes to pension payments so that a reduced rate of pension growth only applied to wealthier Australians. "I'm just not going to engage in pre-budget speculation," he said.
The budget, due May 12, "will be measured, responsible, and fair," he said. "It's a budget that will be good for jobs, growth, and opportunity."
The Daily Telegraph newspaper this week reported that that some members of the government were considering calling an early election the week after the election, even as they trail the opposition Labor party in opinion polls.
"When the public elected us they intended us to govern for three years," Abbott said, when asked about the article. "That's what we intend to do."
i just used january as a base, i could have said september, as prices have been going up since sept 2014. . .. well technically 2008
Investing is not their main priority. They want to move their money outside of China. And most of these people are no longer "foreigners". Many have become permanent residences in the last few years. But the source of the money is still not from Canada.
The government doesn't want to collect the data, but from people in real estate from land titles offices, landcor, bc assessment, colliers etc, realtors, developers you would see that a lot of the buyers are not local.
I honestly don't understand how people can say it's not foreign money. Almost everyone I know says foreign money plays a huge role. It's a trickle down effect.
I'm not even saying it's a bad thing, as I think it's a good thing. I just want restrictions so it doesn't get out of hand or taxes so that we can capitalize on it better.
Weren't rates also cut in 2008 to help deal with the global credit crisis?
Guess what I'm trying to say is what I see is different from what I hear. What I hear from news, media, friends and coworkers is bidding wars and foreign money. They're just here to park their money in real assets, etc... what I see is the same "For Sale" signs day in and day out. There's a lot of properties they can park their money in and they can probably get a deal on it because it's been on the market for so long. I bet the guy on Westview was expecting some rich Chinese guy to buy his new build right away but it's still there.
I'm not for or against real estate, I view it like I would view any investment. I give the same warnings for all investments. Know what you're getting into and don't throw all your eggs in one basket. Back in 2008, people could've bought any stock and it would've turned into gold. Right now, you have to be pickier and more careful. I think the same applies for RE right now, the party isn't quite over yet but proceed with caution.
__________________
"Damn fine car Dodge... Ran over me wife with a Dodge!", Zeke
Last edited by !LittleDragon; 05-05-2015 at 10:06 PM.
^ I think there are also many who are hoping to cash in on this foreign money, and have their homes listed for exorbitant amounts hoping for that 1 right buyer--it only takes 1. The foreign buyers are not stupid and looking to park their money just anywhere. When you have the cash on hand, you have choices and options, and obviously you would still want value.
ie. 25% off on a house asking for 2M that's really only worth 1.5M isn't really much of a deal at all, its an inflated asking price. Also if it's been on the market for so long, you have to wonder why, and are the sellers actually keen on selling or just fishing for the right buyer and cashing in big.
$2 mill and you can't find a house in Richmond for 4 people?! How much space do you need, half the market in Richmond is for sure just under or around the $1-mill marker.
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