5833 replies to this topic

[Nparker]

The one true luxury product is Customs House and it’s aberaging $1,500 per square foot, I think? ...

Averaging meets aberration. A Freudian slip perhaps?

[VicHockeyFan]

No, I'm complaining that most young middle-income earners and families only have the option to rent places where the rent is ridiculous and they have no money leftover to save for downpayment to buy a home. Yes, the things you listed are great for people who want the luxury downtown lifestyle, and that is fine. The problem is that the only developments going up right now are catered toward luxury downtown lifestyles. Everyone keeps saying that it's just supply and demand, and I'm trying to say it's not as simple as that. Just because someone is living in an expensive downtown condo does not mean that person wanted to live in one. In an economy with less than 1% vacancy rates, renters do not get to be picky. They live where they can find a place.

 

Developer builds a downtown condo and advertises the units as modern and trendy. Investors see an opportunity to make some cash and buy the units to rent out. Renters move in because there is no other option, even if the rent is too high and the space is too small. Other developers say, "Oh look, that trendy downtown condo sold out and is fully occupied. I guess what the market wants is trendy downtown condos. I'll build some of those, too." Then the cycle keeps going and no one anywhere along the line asks the people actually occupying the units what they want.

 

The last time I was looking for a rental, I was faced with a Hobson's choice: sign a lease on this tiny, overpriced downtown condo or don't have a place to live.

 

You can't just throw a sack of moldy bread at people who are starving and then declare that moldy bread is what the market wants because people fight each other for it.

 

Homecrier, you do realize that 97%* (*usual) of North America has lower housing prices than us, right?  Just move somewhere better.

[rjag]

And if you get your way and house prices drop 25-30% you do realise you will have put several thousand homeowners underwater and in jeopardy of losing their homes....

[LeoVictoria]

 

September also saw the highest median price for a single-family-dwelling, and an average that was second in line only to June of this year.

 

Foreign buyers behind 5.1% of Victoria's September real-estate purchases

https://victoria.cit...tate-purchases/

 

 

Where did all these numbers come from?   It doesn't match with the data released by the province (https://catalogue.da...r-tax-data-2017 )

 

In september there were 968 transactions in the Capital regional district, not 640 like in the article (954 residential)

4.96% went to foreign buyers in September, not 5.1%

It says foreign buyers were 2% in 2015 but the data wasn't tracked (at least publicly) until June 2016.  I assume this is from a different data source?

Edited by LeoVictoria, 02 November 2017 - 09:03 PM.

[LeoVictoria]

Where did all these numbers come from?   It doesn't match with the data released by the province (https://catalogue.da...r-tax-data-2017 )

 

In september there were 968 transactions in the Capital regional district, not 640 like in the article (954 residential)

4.96% went to foreign buyers in September, not 5.1%

It says foreign buyers were 2% in 2015 but the data wasn't tracked (at least publicly) until June 2016.  I assume this is from a different data source?

 

Ok I understand where you got the 640, that was the sales in September.  This isn't directly comparable to this data though, as foreign buyers are based on land title data, not sales data.  In other words, the counts for foreign buyers is when the title changes hands (closing) not when the sale is reported by the VREB (unconditional offer).

The 5%/5.1% discrepancy is likely due to someone at the globe and mail incorrectly using the residential transactions total for Victoria instead of all transactions.   

Edited by LeoVictoria, 02 November 2017 - 09:56 PM.

[Mike K.]

Interesting, so the data the public has access to is literally ...meaningless?

 

Why is the VREB reporting offers and not titles changes hands?

[LeoVictoria]

Interesting, so the data the public has access to is literally ...meaningless?

Why is the VREB reporting offers and not titles changes hands?

Not meaningless just different. They report unconditional contracts because that represents current sales. Titles changing hands doesn’t happen unil a month or several after the sale which would make it difficult to report timely sales.

Here’s the other issue though. When the VREB says 640 sales for September, that doesn’t even mean there were 640 offers that went unconditional that month.
Some of those 640 sales happened in August or earlier but weren’t reported until September.
Some September sales weren’t reported on Oct 1 when the stats are compiled so they aren’t included.
Some sales from previous months collapsed so they were subtracted from the total.

Edited by LeoVictoria, 03 November 2017 - 06:19 AM.

[Mike K.]

Gotcha, thank you.

[tjv]

Makes sense, but it also brings into question how many sales are happening without realtors?  I know in one case a friend sold their house to their tenant and another friend bought a house from another friend.  In both cases there weren't realtors

 

Around my parents house in Oak Bay there are people knocking on doors asking if they are interested in selling.  I did that a few years ago for a house and property I liked and we were both in pretty serious negotiations, but couldn't come to terms, again without realtors

Edited by tjv, 03 November 2017 - 07:05 AM.

[Mike K.]

And pre-sale purchases are also not tracked by the VREB.

[lanforod]

Right, so then my understanding is the better numbers would be the title transfers, as those should capture all sales, regardless of pre-sale, personal/FSBO etc. You just have to be aware that for title transfers, the actual sale likely occurred 1-4 months earlier.

[FirstTimeHomeCrier]

And if you get your way and house prices drop 25-30% you do realise you will have put several thousand homeowners underwater and in jeopardy of losing their homes....

 

I never said I wanted house prices to drop 25-30%. And I might be missing something, but I don't know how lower housing prices would make current owners lose their homes.

[FirstTimeHomeCrier]

Homecrier, you do realize that 97%* (*usual) of North America has lower housing prices than us, right?  Just move somewhere better.

 

I'd rather stay here and try to make my city a better place for all residents.

[rjag]

I never said I wanted house prices to drop 25-30%. And I might be missing something, but I don't know how lower housing prices would make current owners lose their homes.

 

When your property loses value and is worth less than the mortgage its called being underwater. Its not a problem until you go to renew your mortgage and the bank advises you to come up with the cash difference to reduce the mortgage. 

 

http://www.investope...er-mortgage.asp

 

And in Canada you cant just walk away from your home, the bank will follow you. In some States you get whats called 'jingle mail' where you can walk away from the house and the bank cant chase you for the difference. I believe Alberta has a similar option for some types of mortgages but not BC

 

http://www.investope...jingle-mail.asp

 

Not sure how you can claim you dont want home prices to drop. Thats part of your whole mantra of affordability is to kill the real estate market and deny anyone the right to use property as an investment vehicle

[MarkoJ]

When your property loses value and is worth less than the mortgage its called being underwater. Its not a problem until you go to renew your mortgage and the bank advises you to come up with the cash difference to reduce the mortgage. 

 

http://www.investope...er-mortgage.asp

 

 

If you are making regular mortgage payments and are underwater what incentive does the bank have to put you under? If you aren't making mortgage payments I totally get it but wouldn't the bank be better off to continue collecting payments until the market recovers?

 

Also, currently with interest rates so low principal repayment happens quite quickly; therefore, to be under water after 5 years would require the market to drop by down payment+principal repayment.

[LeoVictoria]

Makes sense, but it also brings into question how many sales are happening without realtors?  I know in one case a friend sold their house to their tenant and another friend bought a house from another friend.  In both cases there weren't realtors

 

Around my parents house in Oak Bay there are people knocking on doors asking if they are interested in selling.  I did that a few years ago for a house and property I liked and we were both in pretty serious negotiations, but couldn't come to terms, again without realtors

 

Those sales will show up in the province's numbers, as the title still changes hands.   

[FirstTimeHomeCrier]

Not sure how you can claim you dont want home prices to drop. Thats part of your whole mantra of affordability is to kill the real estate market and deny anyone the right to use property as an investment vehicle

 

What I want is:

 

• Prohibitive taxes on the sale of investment properties (properties that are not the owner's primary residence and properties sold within the first few years of purchase)
• Incentives for property developers to build homes that are actually affordable and suitable for families
• Housing prices for new developments based on the actual costs of materials and labour (including a salary for the developers), not based on what people have been willing to pay for condos lately

I don't think any of these would cause current homeowners much grief. Even if you are unlucky enough to need to move within the first few years of occupancy, you're not going to lose money. You just make slightly less profit.

Edited by FirstTimeHomeCrier, 03 November 2017 - 11:51 AM.

[nerka]

I never said I wanted house prices to drop 25-30%. And I might be missing something, but I don't know how lower housing prices would make current owners lose their homes.

Lower prices won't make people lose their homes. That is scare mongering. As long as you meet your payments you won't lose your home.

 

What lower prices will do is:

1) increase bankruptcies as people can no longer sell into a rising market when their financial situation goes bad

2) trap some people in their homes as they will owe more than they can sell for

3) probably cause a bit of an economic downturn as spending driven by equity extraction will slow

4) reduce real estate as a constant topic of discussion

 

I'd like to see home prices fall, but I'd like to see it play out gradually over several years with inflation doing most of the work.  A sudden sharp fall in prices would do too much economic damage.

[Mike K.]

"Incentives for property developers to build homes that are actually affordable and suitable for families"

 

How would this be applied?

[FirstTimeHomeCrier]

 

I'd like to see home prices fall, but I'd like to see it play out gradually over several years with inflation doing most of the work.  A sudden sharp fall in prices would do too much economic damage.

 

That's also what I want. I don't know why rjag thinks I want prices to instantly drop 30%.