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Old 09-28-2016, 12:58 PM   #21
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People just need to learn to live with more condos.
There are honestly some solutions to the space crunch aspect of things if people are willing to start thinking outside the box when it comes to things like remote workspaces, etc. For a lot of office jobs, there's no reason why employees need to come into the office and the only reason they're doing so is because managers are still stuck in the past when it comes to supervising employees, holding meetings, etc.

My job is a perfect example of this. I could literally do this job from anywhere in the world and the service I deliver to my clients would be as good or better than it is now. Starting next week I get to work from home two days a week but it's totally silly that they won't let me do all of my work from home if I felt I could do it from there.
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Old 09-28-2016, 01:22 PM   #22
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If I had a dollar for every time I had to sleep with a landlord for a place to stay I'd have like ...

... $24
So after the first 12 month lease was up, you signed up for another 12 months? Did you at least negotiate a percentage on the video rights the 2nd time around?
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Old 09-28-2016, 01:26 PM   #23
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So after the first 12 month lease was up, you signed up for another 12 months? Did you at least negotiate a percentage on the video rights the 2nd time around?
It was actually 12 two month leases.
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Old 09-28-2016, 10:02 PM   #24
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It looks like Vancouver is now going to implement a requirement that people renting out their places on Airbnb have a business licence, in addition to taxing empty properties.

I've been pretty bullish on Vancouver real estate to date, thinking that it will just continually rise (albeit at a slower rate than the panic-induced last 18 months). But the combination of the foreign buyer's tax, Airbnb restrictions, vacant property tax, and the spectre of inevitable interest rate increases now has me thinking there's a perfect storm brewing.

I still don't think the bubble is going to burst, but it could deflate a bit in the next couple of years or so. A big interest rate hike though and things would get ugly pretty quick.
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Old 09-29-2016, 08:49 AM   #25
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It looks like Vancouver is now going to implement a requirement that people renting out their places on Airbnb have a business licence, in addition to taxing empty properties.

I've been pretty bullish on Vancouver real estate to date, thinking that it will just continually rise (albeit at a slower rate than the panic-induced last 18 months). But the combination of the foreign buyer's tax, Airbnb restrictions, vacant property tax, and the spectre of inevitable interest rate increases now has me thinking there's a perfect storm brewing.

I still don't think the bubble is going to burst, but it could deflate a bit in the next couple of years or so. A big interest rate hike though and things would get ugly pretty quick.
Honestly, looking at the various factors, how could it not burst? Even without the new taxes, just the extra scrutiny banks should be doing in that market could send that market tumbling. I don't think a 40-50% drop
is out of the question.
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Old 09-29-2016, 09:31 AM   #26
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Honestly, looking at the various factors, how could it not burst? Even without the new taxes, just the extra scrutiny banks should be doing in that market could send that market tumbling. I don't think a 40-50% drop
is out of the question.
It's interesting. In most housing markets, houses are homes: places for people to live. In Vancouver, the feeling has long been that houses are commodities.

If the latter is true (or largely true) then the housing market here should react the same way any commodity market reacts to bad news or uncertainty: people start to abandon the commodity in search of better, safer places to put their money.

I think any initial drops in the non-luxury market will be buoyed up in the short term by the large number of people living here who (still) are waiting to buy in, looking for a home. But for investors, it'll be much more a case of wait-and-see.

So, yeah, if it really is more of a commodity market full of investors rather than homeowners (if we distinguish "house" from "home"), then a pretty substantial drop could be coming, and the provincial and city governments keep poking it towards that ledge. I still think it'll be the interest rate that gives it the final kick though.
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Old 09-29-2016, 10:10 AM   #27
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Originally Posted by Fighting Banana Slug View Post
Honestly, looking at the various factors, how could it not burst? Even without the new taxes, just the extra scrutiny banks should be doing in that market could send that market tumbling. I don't think a 40-50% drop
is out of the question.
How many bad loans are out there for you to throw out a 40-50% drop?
Despite the latest click bait news article, this is the least of Vancouver's housing problems.
In actual practice, most banks are very particular on the requirements needed for foreign purchasers.
Every foreign buyer I've ever worked with has had to supply 2 years of tax assessments, pay stubs, and all the other items every local buyer has to. In addition to being at max 65% loan value.
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Old 09-29-2016, 10:12 AM   #28
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Has a drop that significant in a single market ever even happened?

A lot would have to go wrong for that to happen.
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Old 09-29-2016, 10:28 AM   #29
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My belief is it will take a catastrophic natural disaster to pop the bubble.
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Old 09-29-2016, 10:50 AM   #30
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How many bad loans are out there for you to throw out a 40-50% drop?
Despite the latest click bait news article, this is the least of Vancouver's housing problems.
In actual practice, most banks are very particular on the requirements needed for foreign purchasers.
Every foreign buyer I've ever worked with has had to supply 2 years of tax assessments, pay stubs, and all the other items every local buyer has to. In addition to being at max 65% loan value.
To be clear, I am not an expert in the Vancouver market or anything, and I am throwing out 40-50%, not as an exact prediction, but more as a counter to a "soft" adjustment of 5-10%. I think it could be much more serious than that.

Also, I don't think the foreign buyer issues are the only problem. As has been discussed in these threads, there seems to be a major disconnect between the earning power of Vancouverites and the prices that exist now. I just don't see it as sustainable. Full stop. Attached is a link to the crazy increases the detached housing prices have seen in just a few months. Could the market correction simply give back that 20% or so? Perhaps, but I would hazard a guess that it could be more than that.

The whole point of major corrections is that most people can't believe such a thing could happen, and yet it happens repeatedly, historically.

http://globalnews.ca/news/2531266/on...-situation-is/
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Old 09-29-2016, 11:03 AM   #31
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Has a drop that significant in a single market ever even happened?

A lot would have to go wrong for that to happen.
Happens all the time, London dropped 40 percent last time it popped, when housing bubbles go they really go as the people involved generally have no experience of markets and have literally all their assets in the house, when they see it start to disappear the panicked attempt to save some of their money is intense.

Bubbles don't need any market conditions or precipitating factors to crater, they both rise and fall on nothing more than optimism, right now I don't know anyone who has any confidance in the market, everyone's waiting for the crash to come, that, in and of itself, is the reason we'll have a crash.

The 'good' news is that the market tends to bounce back fairly quickly particularly if their isn't a rise in interest rates.
If you have a couple of hundred thousand it's the perfect time to buy, ironically.
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Old 09-29-2016, 08:59 PM   #32
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The Chinese do have impact on the Vancouver market but it's understated the impact this will have on local Vancouverites who are just getting by on high mortgage payments due to the price they purchased their home at, hoping to ride it out for a few years and flip.

The banks know this though so I don't see them raising interest rates because it would screw a lot of people and Canada at large to have hundreds of thousands of Canadians unable to meet mortgage payments.

I'm actually not sure what happens from here because interest rates can't go any lower but my feeling is that the banks can't raise them either due to the impact.
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Old 10-03-2016, 09:23 AM   #33
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Government closing the tax loophole.....

https://ca.finance.yahoo.com/news/re...121522744.html

My inlaws close on the sale of their house today. Probably a good thing!
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Old 10-03-2016, 01:05 PM   #34
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Government closing the tax loophole.....

https://ca.finance.yahoo.com/news/re...121522744.html

My inlaws close on the sale of their house today. Probably a good thing!
Interesting for sure. If the Feds make an example out of a few people by seizing properties, this could make a huge impact.
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Old 10-03-2016, 02:52 PM   #35
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It was actually 12 two month leases.
Musician ???

What do you call a musician who just broke up with his girlfriend...


Homeless....
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Old 10-03-2016, 03:07 PM   #36
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Robertson blames the federal and provincial governments but the biggest obstacle to housing affordability is zoning.

Also, looking at single family homes as the barometer for housing affordability leads to some pretty backwards thinking - if Vancouver housing is to get more affordable, it means replacing single-family with multi-family to increase overall supply.
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Old 10-03-2016, 05:59 PM   #37
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Vancouverite here. I have no delusions about how unaffordable and risky this market is.

Natural disaster? Not going to burst the bubble. Look at San Francisco, LA after their major earthquakes. I'm thinking only a nuclear contamination event could decrease property values.

Limit foreign ownership? Going to take out the high end, but now they're moving onto the condo market. Condos are cheaper than houses so the 15% tax is easier to swallow. Local news is reporting this.

Bubble burst? There are lots of locals here who currently rent and want to own (i.e. unfulfilled demand). If prices do drop, locals will enter the buyer's market.

With all these new taxes, municipalities and the province are adding that revenue (ostensibly from foreign buyers) into their budgets. If the taxes have their intended effect and the foreigners go away; they'll have to raise taxes to make up for the shortfall in their budget.

Don't believe me? When's the last time your property taxes went down because a social issue was addressed?
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Old 10-03-2016, 09:02 PM   #38
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For context, I am obviously not a Vancouver real estate guru and frankly I'm not a huge fan of living in a city, but I could not believe our trip to Vancouver this month. We were there for a wedding in North Vancouver and found an Airbnb not too far from the venue. The owners lived in the house and were using the Airbnb option to help with the mortgage. I would guess the house was in the 1.3-1.5 million range and definitely needed some work, but was on a nice lot. They also had another tenant in the basement. The owners had a young family and apparently stayed with their parents when the house was rented out. I really could not believe that people would see this as a realistic option, but I guess it is not uncommon.

One of the couples were renting a basement suite down the street and it was likely a $2 million home. Again, fairly nice house, but not overly big on a nice lot. The owners were also a young family and couldn't afford the mortgage without tenants. The shocking part to me was can you imagine a property in Calgary worth $2 million that would have tenants? My guess is most properties worth over $1.5 million in Calgary probably almost fully paid for or have very small mortgages.

Anyways, it was a really eye opening experience and tough to imagine making a go of it there.
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Old 10-04-2016, 08:23 AM   #39
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That's a big part of it, we are not talking about mansions here or really, even nice houses. A below average to barely livable house is going for over $1 million. Most streets are now jammed packed with cars as most houses have two if not three or 4 families living in them. It is not pretty and glamorous by any means.
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Old 10-04-2016, 08:43 AM   #40
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My guess is most properties worth over $1.5 million in Calgary probably almost fully paid for or have very small mortgages.

I think you underestimate the amount of people that live their life according to "So what do you want your monthly payment to be?"
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