Vancouver Property Petitition
May 21st 2015, 10:02 pm
#166
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,682
Re: Vancouver Property Petitition
It's a big bubble. Look at all the UK and US as examples where it couldn't possibly happen. Don't forget, people thought they were too expensive 10 yrs ago but affordability was much much better. In 10 years the debt levels of Canadians has increased a crazy amount and the ceiling is closing in.
Can't you smell the change in the air? Smells lovely 
Patience is all you need.
Patience is all you need.
* I can give you numbers and sources but you will have to wait until I get home
May 21st 2015, 10:32 pm
#167
Beep
Joined: Jan 2009
Location: Here
Posts: 8,311
Re: Vancouver Property Petitition
I know I am turning into a crusty old git these days but to me the millenials' angst seems, at least partly, to be the result of an unreasonable level of expectation.
When we first were married we would have loved to buy a detached home in Hampsted. We couldn't afford one. What we could afford was to rent a one bedroom flat in South London that was already occupied by an interesting selection of wildlife, where we had to shove newspaper in the gaps in the window frames to keep the winter winds out, where we had to walk along a common landing to get to our bathroom.
The incentive to save was strong.
When we eventually saved enough we managed to buy a maisonette in a converted Edwardian house in Hanwell. It had a builders yard out the back, was on a busy road, and across the road was a DIY warehouse. It was grimy and needed at lot of TLC. But it was what we could afford.
Subsequent moves were to better houses in better areas but you start with what you can afford.
Many younger people these days seem to think they should be able to start with a 3,000 sf single family home with stainless steel appliances and granite countertops. Most of them can't afford one but most would be able to afford a condo in Coquitlam for $138,000 or in Vancouver Eastside for $198,000 (if the air is too thin out in Coquitlam). But it is easier to whinge.
When we first were married we would have loved to buy a detached home in Hampsted. We couldn't afford one. What we could afford was to rent a one bedroom flat in South London that was already occupied by an interesting selection of wildlife, where we had to shove newspaper in the gaps in the window frames to keep the winter winds out, where we had to walk along a common landing to get to our bathroom.
The incentive to save was strong.
When we eventually saved enough we managed to buy a maisonette in a converted Edwardian house in Hanwell. It had a builders yard out the back, was on a busy road, and across the road was a DIY warehouse. It was grimy and needed at lot of TLC. But it was what we could afford.
Subsequent moves were to better houses in better areas but you start with what you can afford.
Many younger people these days seem to think they should be able to start with a 3,000 sf single family home with stainless steel appliances and granite countertops. Most of them can't afford one but most would be able to afford a condo in Coquitlam for $138,000 or in Vancouver Eastside for $198,000 (if the air is too thin out in Coquitlam). But it is easier to whinge.
Kids expect to immediately own the same home and car as their parents. They also expect to keep up with their acquaintances whether it requires a huge level of debt to do so.
The Canadian dream of home ownership is weird.
May 21st 2015, 10:40 pm
#168
Beep
Joined: Jan 2009
Location: Here
Posts: 8,311
Re: Vancouver Property Petitition
Whilst I hate to bring this thread down to the level of facts, debt really isn't a problem in the Canadian economy. You can make a good argument that Canada in under-leveraged right now. Overall debt to GDP in Canada is amongst the lowest of developed countries. Less than the UK for example. And, whilst household debt to GDP is higher than the UK it is way less than other western countries like The Netherlands or Denmark*. No one is predicting that particular bit of sky will fall on Europe.
I fully believe Vancouver house prices will be less in two years time than they are today. I'm not in the market to buy so i have no horse in the race. I just find it incredible people are striving to buy in today's market.
May 21st 2015, 11:38 pm
#169
Account Closed
Joined: Jan 2006
Posts: 0
Re: Vancouver Property Petitition
When you have young people who grow up in expensive housing places where they know they will never own anything, the incentive to save isn't there, and that is an issue, why save for something you will never have the income to buy anything.
Some young people also don't have the income to save much if anything. Hard to save when rent eats 50% or more or more for some folks.
Rents are just as affordable in Vancouver region, and its also not feasible to live in Maple Ridge or Coquitlam if your job is in Vancouver, can take 2+ hours to commute on transit, and we need to get rid of the commuting lifestyle and not encourage people to live far from work.
Affordability also varies by individuals, what one considers affordable another may not.
It's a lot harder to get the income necessary even compared to 10 years ago, unless in a high demand high paying field.
Some young people also don't have the income to save much if anything. Hard to save when rent eats 50% or more or more for some folks.
Rents are just as affordable in Vancouver region, and its also not feasible to live in Maple Ridge or Coquitlam if your job is in Vancouver, can take 2+ hours to commute on transit, and we need to get rid of the commuting lifestyle and not encourage people to live far from work.
Affordability also varies by individuals, what one considers affordable another may not.
It's a lot harder to get the income necessary even compared to 10 years ago, unless in a high demand high paying field.
May 22nd 2015, 12:49 am
#170
BE Forum Addict
Joined: Feb 2013
Location: BC, Canada
Posts: 3,874
Re: Vancouver Property Petitition
I know I am turning into a crusty old git these days but to me the millenials' angst seems, at least partly, to be the result of an unreasonable level of expectation.
When we first were married we would have loved to buy a detached home in Hampsted. We couldn't afford one. What we could afford was to rent a one bedroom flat in South London that was already occupied by an interesting selection of wildlife, where we had to shove newspaper in the gaps in the window frames to keep the winter winds out, where we had to walk along a common landing to get to our bathroom.
The incentive to save was strong.
When we eventually saved enough we managed to buy a maisonette in a converted Edwardian house in Hanwell. It had a builders yard out the back, was on a busy road, and across the road was a DIY warehouse. It was grimy and needed at lot of TLC. But it was what we could afford.
Subsequent moves were to better houses in better areas but you start with what you can afford.
Many younger people these days seem to think they should be able to start with a 3,000 sf single family home with stainless steel appliances and granite countertops. Most of them can't afford one but most would be able to afford a condo in Coquitlam for $138,000 or in Vancouver Eastside for $198,000 (if the air is too thin out in Coquitlam). But it is easier to whinge.
When we first were married we would have loved to buy a detached home in Hampsted. We couldn't afford one. What we could afford was to rent a one bedroom flat in South London that was already occupied by an interesting selection of wildlife, where we had to shove newspaper in the gaps in the window frames to keep the winter winds out, where we had to walk along a common landing to get to our bathroom.
The incentive to save was strong.
When we eventually saved enough we managed to buy a maisonette in a converted Edwardian house in Hanwell. It had a builders yard out the back, was on a busy road, and across the road was a DIY warehouse. It was grimy and needed at lot of TLC. But it was what we could afford.
Subsequent moves were to better houses in better areas but you start with what you can afford.
Many younger people these days seem to think they should be able to start with a 3,000 sf single family home with stainless steel appliances and granite countertops. Most of them can't afford one but most would be able to afford a condo in Coquitlam for $138,000 or in Vancouver Eastside for $198,000 (if the air is too thin out in Coquitlam). But it is easier to whinge.
I agree!
Our daughter is 41, and hers was the first generation to be told in high school that they could not expect to be in one job all their lives as their parents and grandparents had been, that they must be prepared to change careers, and even re-train if necessary. Financial analysts also pointed out that her generation would be the first generation who would not do better than their parents. It might just have been her school ......... but the counsellors and career teachers made sure that the girls also understood this aspect of their lives.
My personal experience is as follows, although some of you may not wish to read it
We have lived in Vancouver since 1968, and owned a house since 1972 .... the same house. We bought a house where the mortgage and living costs could be handled on only 1 salary, so I was not compelled to work.
We did look at moving in 1977, but found that house prices had increased slightly in those 5 years, and that we actually preferred to stay in this neighbourhood.
So we negotiated a new higher mortgage and spent $50,000 on adding a 2 room extension and changing the inside. We could still manage that mortgage and living normally on only one salary, although I continued to work. My salary paid daycare costs, private school, and extra-special holidays every 2 or 3 years (most holidays were camping trips)
We've also lived through a melt-down that most of you will not even know about.
In the late 1970s and early 1980s, people bought houses for more than they could afford, so had huge mortgages. Then came the recession, and mortgage interest rates climbed and climbed.
In about 1982/3, we locked in our mortgage for 2 years at 13% interest ......... and still the rates climbed, until they reached 21%
People literally walked away from their houses, just let the banks and mortgage companies take them back. That is not hearsay or urban myth ......... one guy did it with a house across the street from us. It went back on the market for far less than he had paid for it.
Fortunately for us, the mortgage rates began to drop as the economy began to improve, and was at 12% when it was time for us to renew.
Will that happen again??
I don't know.
I do know that Canada was sheltered from the worst of the recession a few years ago that hit the US and UK very hard ..... because the Governor of the Bank of Canada refused to allow the banks to offer the fantastic mortgage lending policies of those other countries. Mark Carney is now the Governor of the Bank of England.
Will the current Governor of the Bank of Canada follow Carney's lead if a recession seems to be deepening? Who knows!
May 22nd 2015, 1:06 am
#171
Account Closed
Joined: Jan 2006
Posts: 0
Re: Vancouver Property Petitition
I agree!
Our daughter is 41, and hers was the first generation to be told in high school that they could not expect to be in one job all their lives as their parents and grandparents had been, that they must be prepared to change careers, and even re-train if necessary. Financial analysts also pointed out that her generation would be the first generation who would not do better than their parents. It might just have been her school ......... but the counsellors and career teachers made sure that the girls also understood this aspect of their lives.!
Wish we had career teachers and counselor in my high school. They got rid of those types of services by the time I got to high school. I didn't go to HS in Canada though, and I was in HS in the dark era of California education where it was not good overall, and lots of overcrowding and funding issues.
Only advice I got from any teacher in HS was, you don't have the grades for college, so you need to go into the workforce and do what you can to find a job and that is what I have done ever since.
I was never an academic, and never will be, and with colleges so competitive, its hard to re-train when your so far behind academic wise.
May 22nd 2015, 1:15 am
#172
Account Closed
Joined: Jan 2006
Posts: 0
Re: Vancouver Property Petitition
I agree!
Our daughter is 41, and hers was the first generation to be told in high school that they could not expect to be in one job all their lives as their parents and grandparents had been, that they must be prepared to change careers, and even re-train if necessary. Financial analysts also pointed out that her generation would be the first generation who would not do better than their parents. It might just have been her school ......... but the counsellors and career teachers made sure that the girls also understood this aspect of their lives.
My personal experience is as follows, although some of you may not wish to read it
We have lived in Vancouver since 1968, and owned a house since 1972 .... the same house. We bought a house where the mortgage and living costs could be handled on only 1 salary, so I was not compelled to work.
We did look at moving in 1977, but found that house prices had increased slightly in those 5 years, and that we actually preferred to stay in this neighbourhood.
So we negotiated a new higher mortgage and spent $50,000 on adding a 2 room extension and changing the inside. We could still manage that mortgage and living normally on only one salary, although I continued to work. My salary paid daycare costs, private school, and extra-special holidays every 2 or 3 years (most holidays were camping trips)
We've also lived through a melt-down that most of you will not even know about.
In the late 1970s and early 1980s, people bought houses for more than they could afford, so had huge mortgages. Then came the recession, and mortgage interest rates climbed and climbed.
In about 1982/3, we locked in our mortgage for 2 years at 13% interest ......... and still the rates climbed, until they reached 21%
People literally walked away from their houses, just let the banks and mortgage companies take them back. That is not hearsay or urban myth ......... one guy did it with a house across the street from us. It went back on the market for far less than he had paid for it.
Fortunately for us, the mortgage rates began to drop as the economy began to improve, and was at 12% when it was time for us to renew.
Will that happen again??
I don't know.
I do know that Canada was sheltered from the worst of the recession a few years ago that hit the US and UK very hard ..... because the Governor of the Bank of Canada refused to allow the banks to offer the fantastic mortgage lending policies of those other countries. Mark Carney is now the Governor of the Bank of England.
Will the current Governor of the Bank of Canada follow Carney's lead if a recession seems to be deepening? Who knows!
I know my great grandmother had to sell her house in '85, no clue why but we lived in the upstairs part, and had to move when she had to sell.
She always just said she had to sell and didn't have a choice, never did learn why she had to sell.
She bought her house in the 40's with her husband who died in the early 70's.
My dad bought in California right before the recession, bought for 600,000 and some change, everything collapsed and value went down into the high 300,000's but has now rebounded and while not worth what they paid, they are above water again, but they are not on the market so it doesn't matter, but close to 1/2 his neighborhood was foreclosed on during that time frame.
House next door sat empty for almost 2 years before it was auctioned off.
May 22nd 2015, 2:56 am
#173
Account Closed
Joined: Jan 2006
Posts: 0
Re: Vancouver Property Petitition
Up 11.6% in Squamish over the last 12 months.
Squamish home prices spike 11.6%
Getting to a point nothing is affordable, rent or buying.
"The benchmark price for a residential home in Squamish is now $436,700. That’s a composite, reflecting a typical single-family house at $570,000, a townhouse at $372,800 and an apartment at $272,900."
Squamish home prices spike 11.6%
Getting to a point nothing is affordable, rent or buying.
"The benchmark price for a residential home in Squamish is now $436,700. That’s a composite, reflecting a typical single-family house at $570,000, a townhouse at $372,800 and an apartment at $272,900."
May 22nd 2015, 4:19 am
#174
BE Forum Addict
Joined: Feb 2013
Location: BC, Canada
Posts: 3,874
Re: Vancouver Property Petitition
To me, it is not only the fact that house prices are rising, but that mortgage rates are so low, and thus people are taking out mortgages to the limit that they can afford NOW
If the mortgage interest rises even 1%, many of them will be "up the creek without a paddle" ........
...... just as so many were when the mortgage rates went as high as 21%
We had friends who bought a 4 or 5 bedroom house on 14th Avenue out on Point Grey in 1964 from the owner. I have no idea what the price was, but I do know that the mortgage offered by that owner was 3% over 25 years.
Needless to say, the owner wanted to re-negotiate in the early 1980s when mortgage interest rates were so high ....... our friend refused, insisted they keep to the 25 year contract.
If the mortgage interest rises even 1%, many of them will be "up the creek without a paddle" ........
...... just as so many were when the mortgage rates went as high as 21%
We had friends who bought a 4 or 5 bedroom house on 14th Avenue out on Point Grey in 1964 from the owner. I have no idea what the price was, but I do know that the mortgage offered by that owner was 3% over 25 years.
Needless to say, the owner wanted to re-negotiate in the early 1980s when mortgage interest rates were so high ....... our friend refused, insisted they keep to the 25 year contract.
May 22nd 2015, 4:36 pm
#177
Yo
Joined: Nov 2012
Location: UK
Posts: 24,474
Re: Vancouver Property Petitition
It's not about where Vancouver is on the world's stage (as we would agree on that) but it's attractiveness to other Canadians wanting to escape the colder provinces and the pool of Asian investment money. There may be small corrections (10%) but beyond that there is external property money that will prop up prices. If you're expecting a 20-25% bubble pop! probably not going to happen. That's my crystal ball reading.
May 22nd 2015, 5:57 pm
#178
Beep
Joined: Jan 2009
Location: Here
Posts: 8,311
Re: Vancouver Property Petitition
Well, that seems to have been 2008, and the whole of California and the US suffered falls because of the financial crisis.
It's not about where Vancouver is on the world's stage (as we would agree on that) but it's attractiveness to other Canadians wanting to escape the colder provinces and the pool of Asian investment money. There may be small corrections (10%) but beyond that there is external property money that will prop up prices. If you're expecting a 20-25% bubble pop! probably not going to happen. That's my crystal ball reading.
It's not about where Vancouver is on the world's stage (as we would agree on that) but it's attractiveness to other Canadians wanting to escape the colder provinces and the pool of Asian investment money. There may be small corrections (10%) but beyond that there is external property money that will prop up prices. If you're expecting a 20-25% bubble pop! probably not going to happen. That's my crystal ball reading.
So i'm curious how Vancouver is different other than the bubble has lasted longer.
May 22nd 2015, 6:25 pm
#179
Binned by Muderators
Joined: Jul 2007
Location: White Rock BC
Posts: 11,682
Re: Vancouver Property Petitition
Considering average prices in San Fransisco are now 20% higher than they were before the 2008 crash, then if that is what happens when a bubble bursts I say bring it on.
May 22nd 2015, 6:49 pm
#180
Yo
Joined: Nov 2012
Location: UK
Posts: 24,474
Re: Vancouver Property Petitition
It's a curious market, to be sure, but perhaps it's underlying factors are different from other property markets. It doesn't seem to be a bubble, more like a perpetually overbought market. San Francisco is now closely aligned with tech industry, and there are plenty of other great Californian (let alone US) investment opportunities. Canada is really only Toronto and Vancouver for international investment, and Vancouver has residential/resort appeal too.