You're assuming that they are only holding 1 property and they bought with straight cash. Drop in the bucket it may be for the ultra rich but not for the regular rich coming from the mainland (the majority with less than $10M net worth). A lot of home buyers from China in Vancouver are speculating investors. They buy for $1m and try to sell it couple months down the road for $1.2m. They may even hold a year, rent it out and see what happens.

When they need the cash to cover their highly leveraged positions, they'll sell the shirt of their backs to make sure they don't go bankrupt or even worse, harassed by loan sharks that will genuinely threaten their family's life. This happens quite often with the ultra rich too. When the party is over, its really over no matter how rich you are.

Mr. Market gives and Mr. Market takes. What kind of bubble do you live in to think Vancouver will not see some sort of correction some day? You're thinking, yeah but its been steadily growing for the past couple months. For me, its been exactly the same price since my money is in USD/HKD. To me a $1.2m property today is more or less the same as a $1m property 1 year ago just due to exchange rates. You may look at that 20% gain as something but to foreign investors, its a loss.

QFT!

The money they parked here in Vancouver RE was illegitimate in the first place. It makes no sense to cash out and repatriate that money as that would defeat their initial purpose. If anything, if shit hits the fan in China, they will cash out their assets in China, and jump ship to one of their investment destinations (for ex., Vancouver).

All over the Dunbar / Southlands area there are sooooooo many empty houses that have been empty for 1+ year(s).

My ex-girlfriend sold a property 7 years ago in Southlands for just around 1 million I think, now properties on the same +/- 1-2 blocks with the same approximate lots are selling for near 3 million!

6203 DUNBAR ST, Vancouver, British Columbia V6N1X3 - V1122994 | Realtor.ca

I can't believe how many 4-5 million dollar properties there near Dunbar. Damn!

That's the problem. Its fine when they are throwing new money at each other and everyone around is happy but what happens when they stop throwing even more new money around and are suddenly strapped for cash? You guys gotta remember that this is basically the first time China (not HK) has seen this type of crash in the stock market. Money has been growing out of trees for the past 20-30 year there and they'll throw majority of their money/or max leverage their position when it seems even easier to make in the stock market. People are greedy by nature. They want more and will find the easiest way to make even more because most of their success came naturally with China's growth over the years.

But what do I know...

NKC ONE knows what's up with business in China. Are people panicking in China? Have you purchased property in YVR yet?

Keep in mind that approximately 30% of the investors in the Chinese stock market are illiterate... so they are buying stocks based on whatever their friends say.

Inb4 Charles in Charge blames the illuminati, zionist who control the United States for waging an economic war on China

NKC ONE thanks for your posts, very enlightening! Revscene is awesome for this.

I won't claim to know all the ins and outs of doing business in China but I have business there and I know a lot of people who do. When you're in Asia, business usually isn't the main source of income. You find every opportunity to use your leverage and exponentially grow your wealth. Works great when the timing is right but greed usually takes over before its too late.

I'm actually in YVR right now so I don't physically know if they're panicking there. From experience, I just know a lot of people are going to either kill themselves or go completely broke. Whether China discloses this info is for another thread by CIC. I was one of them back in the 2008 crash in HK. Big noob I was back then. Same noob this time around lol. I pulled out the majority of my position 6 months ago to prepare for a house purchase. Left a bit in the market to gamble on extremely volatile stocks based purely on tips. In 6 months i made about a 75% return on paper. Fun times until couple days ago where I sold it all for roughly a 15% loss on my original investment. There goes my GT3 money. I actually feel quite relieved because I would've been down roughly 60-70% today.

I have to also comment on paper gains. A lot of these China investors see their paper gains as real gains. They leverage even more with their gains or recklessly buy a whole bunch of reckless shit. Most of their gains on paper are probably spent and now they have to pick up the bill for what they owe on margin.

It's mostly straight cash for them to buy because they're not really able to get a mortgage here due to lack of credit history and excessive amounts of cash.

You have to keep into consideration the RE run-up is a consequence of a capital drain in China. The main reason is the rich folks/officials moving their money OUT of china, through underground brokers and other shady methods, trying to keep the money as far away from the Communist Party as possible. The intent is to ensure there is enough money for "forced retirement" for themselves & family in the event shit hits the fan (getting busted for corruption or other things) That money is either money they don't need, or bribes they have collected.

Holding cash in a bank account is a mentally unsafe thing to do because there is this minute fear that the Canadian government will freeze their bank accounts or take their money. I think we all know Chinese people love RE like fat kids in a candy store, so they look at Vancouver RE and see "for 10m RMB I'm buying a nice 2000sq apartment or a nice landed house in Vancouver". Then they end up buying the property under a family member or a close relative's name.

Having said that, there might be the oddball that would repatriate their ill-gotten gains by selling their house. However, I doubt that's a majority. I would tend to think RE prices stabilize (don't grow) for a while and transaction volume drops, but I don't see the higher end of the market selling at discount because they're willing to "ride it out". There's also real estate developers willing to pay extra 30% to buy the block, and then there are people outgrowing their condo/townhouse, kids moving out etc.

Money never existed.
Do your research, this is called "fiat currency"

Money you're talking about is nothing physical. They never existed. It's all data in your bank's computer.

Anyways, that was quick. Selling knock offs will only get you so far.

I really hope this comes true... It's sad when I have to now look at 2 bedrooms CONDO in Vancouver selling for $1m.

If money is handed over to someone who is uncapable, it will be a recipe for disaster. It's just a matter of time.
Big money should only be handled by someone who knows how to use it properly.

This is exactly why majority of lottery winners get in shit after becoming a multi-millionaire all the sudden.
Normally, they will just end up where they came from, or end up even worse.

shanghai ordered just buy back, the index jumped just now. let's see if it will continue.

i don't play china shit. USA is enough for me.

anyway, what goes up must come down. it's just a natural cycle.

http://www.macrobusiness.com.au/wp-c...sandmanias.gif


you guys are all hoping china crash will somehow make our real estate cheaper.

trust me, if our real estate is cheaper, it means we're also crashing. and you're still not gonna be able to afford it cuz you lost your job LOL.


who knows, when the stars align, that's when crashes happen.

bubbles...
chinese local govt debt
chinese real estate
chinese everything.

if they all crash, and greece is fucked and leaves the EU. it could trigger a global recession again.

remember prices are dictated by human action. if everyone just sat at home with their hands up their asses, the markets would be flat.

people have to put up bids/asks, and people have to fill those bids/asks for the market to move.

you have to ask yourself who are those people filling those bid/asks as the market goes down. and why they are doing it.
they all have their own insane reasons to buy or sell at a certain price.

it's only when the majority of people all coincidentally sell at the same time for different reasons does the market crash.


reasons don't matter. that's a historical fact that will be pegged on afterwards. there will be a billion reasons. reasons are lagging indicators.

if you wanna make money, reasons don't matter. just act as it's happening and follow the strength. direction strength is easy to see. but the reasons behind it... leave that up to the economists and nerds to write in the history books.

like surfing, you don't try to predict how far the wave will go. you just ride it out and if its a bunk wave, you ditch it and wait for the next one.
trying to predict where the wave will go is impossible. that's not a game you play if you're trying to make money. just ride it for what it's worth. it's a handout, you take what it gives u then you leave.

Chinese investors pay in cash but a lot of them take out a small mortgage to build credit in Canada. They put 50-80% downpayment.

Anyway the market reversed, so who knows if it was a blip or a dead cat bounce. But Im sure it scared a lot of Chinese investors and gave them a taste of capitalism.

Slightly off topic but there was this one thing you have to watch out for if you are buying a home from a foreign investor... something to do with taxes and the CRA. If they have numerous properties it's ok but if it's their only property you have to make sure they have a reserve for some kind of tax.

Can't agree more, especially with the statement about crashing and losing jobs. Like anything in the world, it's only desirable when its not affordable. If anyone could afford housing, prices would be quite flat and low for the longest time.

I'm closer to HK so I'll give my POV about how people will suddenly not be able to afford housing even if it crashed 50%. Let's say you're looking to buy but can't really afford it. You got money saved up but month after month, the price continues to rise. You're a smart logical person that knows markets are cyclical, what goes up must come down. Eventually, you'll be able to afford something that you want just as long as you keep working hard. So what do you do with the money that's sitting around? You don't just let millions (hkd) sit in the bank right? How can you when everything pays shit interest these days. So like every middle aged women, grandmother and their maid, you invest in the stock market because easy money right? Everyone is talking about making money and you look like a fool sitting on the sidelines with bundles of cash sitting in the bank. You could hit the right tips and make 10%-50% a day. On paper, you start making good money. Good enough to even say fuck it to the 9-5. Then one day, bam, Mr. Market wants his money back. You've spent some of that paper gain and bought a car, a nice watch, rented a better place, started wearing brand name shit and the list goes on. Let's say you didnt buy all that crap and continued to snowball that money to make more money. Let's even go as far as leveraging your cash/stock position with a 100%+ margin account and start maxing that out.

So the RE crashes with all the stars aligned and Mr. Got It All Figured Out is broke, has amassed new debt, and can't even hold his job anymore but yet he was right all along about the RE market crashing. He saw it, waited for it but couldn't take advantage of it. At the same time, no one else is interested in buying anymore because it could drop more or are in a similar situation. So at the end of the day, he still can't get a place and is close to broke. This shit happens about once every 10 years in HK, its ridiculous how short people's memories are and fall back into the same trap. I was one of those suckers this time around too but I held myself back on how much to play.

We've been hammered with the idea of making our money work for us and grow more money by itself. What we kind of forget is that opportunity has its risks to achieve those returns. People are always going to be greedy and chase more. Instead of that $1m house, I want that $3m house. I can get a couple supercars and live the dream. YOLO right?

I can tell you that the majority of Vancouverites will not be able to afford housing no matter what happens, unless mommy and daddy pays for the downpayment and serves as guarantor. Income is low here and the chill factor basically breeds laziness. Business opportunities suck and taxes are high. I know a lot of you guys are frustrated as hell watching your beloved city get bought out piece by piece, I am too. I knew straight out of college that I couldn't make my dreams happen if I stayed and worked here. I left, made some good money and I'm one of the A-holes coming here to buy things up, once again I'm sorry for that. I took my risk working and eventually building a business elsewhere and if I failed, I don't see how my position would be different than if I stayed and worked here.

Sorry for the long post.

So do I buy now or later in Vancouver?

The heart wants what the heart wants. If you can afford it now and is comfortable with the chance of market fluctuations then go for it.


On another note, I just glanced at one of my more heavily invested stock that I sold couple days ago go from $0.40 to $0.78 today. I'm a pretty big dumbass when it comes to this shit and probably most shit too. This just ain't my game.:okay:

I'm still skeptical that the China market will continue its glory. Seems like a try hard to recover with tremendous government force.

^
dont buy now & dont buy later, build a time machine & go back in time to buy :troll:

im hoping this market crash can help me make a bit of money on this side of the pound

...
No one's losing their shit anywhere in China.
Other than arm-chair "business men" (closet "fu-er dai") and chumps.
This "crash" is meaningless.


The Chinese market has a free-float value of about 33% GDP... Most developed economies are over 100% GDP.
Less than 15% of household income is in the market.
China is very far from reliant on the stock market, unlike other developed nations.
Increases in share value do little to increase consumption in China, and decreases in share value do even less to decrease consumption.

So not only does this have little to no effect over in China, it sure as hell isn't going to change anything in Vancouver.

And side-bar, one point that a lot of people tend to glance over in terms of Vancouver RE, is that while Chinese people (arguably) may have driven up prices. It's locals who keep them high. For every 1 Chinese guy I've heard buy property in Vancouver, I've heard of 9 locals buy property in Vancouver (under the insanely wrong notion that "If we don't buy NOW, we'll never be able to buy"). This fear that they'll be priced out of their hometown is what's driving people to spend obscene amounts of money on a condo or house. This fear is nothing but fear, and when the market crashes; the Chinese guy is gonna be fine, but the locals are going to be fucked.

Read more about it since yesterday.

China's stock market has gained 110% in value this year, lost 30% in the last couple of days, then the western mainstream media calls it a crash. Lol

I wish the media would publish what you just said instead of "foreign investors drive up market" to trick people into keeping our real estate driven economy flying out of control. Its fucking propaganda, and its making people racist. Horribly irresponsible journalism.

I think people mistaken/confuse foreign investment with actual Chinese-Canadian residents who buy property lol

It's true the price is driven up, but that's due to demand and supply... and rich people all over the place (not all of them chinese)

lol so true
If you're in an industry that revolves around manufactured goods in some way...lol

Like this?

People leveraging their debt based on the value of their home, and using that to buy a luxury car. It's absolutely insane!



source:Luxury car sales in B.C. nearly 50 per cent above the national average - British Columbia - CBC News