Sept 19 Market Update

Weekly stats update courtesy of the VREB via Marko Juras.

September 2016
Sept
 2015
Wk 1 Wk 2 Wk 3 Wk 4
Unconditional Sales 104  241 422
704
New Listings 108 363 621
962
Active Listings 2011 2061  2079
3478
Sales to New Listings  96% 66%  68%
73%
Sales Projection 732 767
Months of Inventory

4.94

Inventory slowly creeping up but we’ll have to wait a few more weeks to see whether this is anything of significance.   Normally at this time of year, inventory decreases, so it seems we’re bouncing around near the bottom of what can be sustained as inventory.

Currently we are on track to exceed last year’s sales numbers by about 10% or so which will probably be just barely short of the September record set in 2009 when the market was roaring back from the collapse of the financial crisis.   Despite seasonal slowdowns that are visible by fewer lawn signs, I don’t see too many signs of a change in the market yet.

By the way, the province appointed a new superintendent of real estate to take over the previously self-regulated (i.e. not regulated) Real Estate Council.   While it might take a couple months, I suspect Mr. Noseworthy will be eager to show action on this front well before the provincial election with additional regulatory restrictions on the industry.   As we’ve seen in Vancouver, those are the real wildcard that can sweep the legs out from under any market no matter how hot.

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195 thoughts on “Sept 19 Market Update

  1. I suppose the way to explain the market is that it is still hot relative to past years but it is cooler than it was back in April and May of this year.

    This is for all properties in all areas. There are some areas that are more volatile than others with incredible month to month price swings of as much as 20%. These areas tend to be neighborhoods of low sales activity and high prices that are predominately marketed using delayed offers.

    Depending on what type of property and where you own the factors will be somewhat different.

  2. Not since 2007 have we had a year of such low months of inventory and low days-on-market. Yet prices have remained stable due to the increase in new listings that have come to market during the year.

    The months of inventory for most of this year was under 2 months. This morning it stands at 2.59 for all types and all areas which is the second highest MOI since January when it was 4.0. The DOM is similar, for most of the year it has remained under 16 days. Well below that of January when it was 35 days. Currently it stands at the third highest for the year at 17.

    The big surprise has been the sudden increase in sales and new listings this year that peaked in April and May and have decelerated steeply since then. And today we are back to historical norms after experiencing a bubble in demand and supply that lasted for about 6 months. The rise was one of the strongest in the last decade but so has been the decline.

    On the way up prices typically increase rapidly when market factors are accelerating but when market factors are decelerating, prices tend to moderate lower over a longer period.

    And that seems to be what is happening

    Month Sale Price, Median all properties and all areas
    Jan $454,250
    Feb $491,500
    Mar $509,500
    Apr $536,000
    May $505,000
    Jun $505,500
    Jul $508,500
    Aug $489,900
    Sep $511,000

  3. “So looks like September will be 2nd strongest ever on record in terms of sales and active inventory will be lowest ever recorded.”

    2nd strongest for SFH’s in the core or GV ? Sales are still down more than 40% from May, the market is still cooling no matter how you pump it.

  4. Dear Marko:

    That was very helpful to know about Derby. Actual sale prices, time line and visible demand are equally important to me as just statistics. So thank you for posting.

  5. “I stopped by 1508 Derby over the weekend and it was busy. Property also went 55k over asking unconditionally @ $805,000. Purchased in 2012 for $556,500.”

    Wow, the suckers are still out there. Looks like flood potential off the peak of the hill.

  6. So looks like September will be 2nd strongest ever on record in terms of sales and active inventory will be lowest ever recorded.

    I stopped by 1508 Derby over the weekend and it was busy. Property also went 55k over asking unconditionally @ $805,000. Purchased in 2012 for $556,500.

  7. I’m not really sure but imagine it’s self declared citizenship by buyers. Marko is there any verification for that data?

    Government provided stats so I don’t know the details.

  8. Mon Sept 26, 2016:

    Sept Sept
    2016 2015

    Net Unconditional Sales: 608 704
    New Listings: 844 962
    Active Listings: 2,060 3,478

    Please Note

    Left Column: stats so far this month
    Right Column: stats for the entire month from last year

  9. I’m not really sure but imagine it’s self declared citizenship by buyers. Marko is there any verification for that data?

  10. Leo S
    That bar graph you showed earlier showing the foreign sales being 3% in Victoria, does that include students buying homes for their parents? How is that number derived?
    Thanks.

  11. Calgary prices are down, perhaps Zolo is not as reliable as some sources but homes sitting on the market for months and condo sales are as low as in 2003

    Oh sure. I don’t doubt Calgary prices are down. I just get annoyed at people presenting data badly.

    Like I said change will happen in the most buoyant of markets and Victoria is no different.

    We just had declining prices from 2010 to 2013. Of course it can and will happen again. It’s just not incredibly likely in the immediate future given current market conditions.

  12. ICYMI, the foreigners are “pissed off”. If your praying for a blip, best say a few Hail Mary’s, they’re outta here.

    “Vancouver has been losing local and overseas buyers all year,” Matthew Moore, president of the Americas for Juwai.com, said. “The shift is towards cities with similar appeal but lower entry prices.”

    He now says his wife has an American client who wants to sell his downtown penthouse because “he doesn’t feel welcome.”

    “He brought a tech company up here from Silicon Valley… and moved a bunch of employees up here, and he’s basically saying that he’s out of here. He wants to sell his penthouse and likely move his business back down south.”

    “West Vancouver realtor Brent Eilers says he too has witnessed a “dramatic drop.”

    According to Eilers, he has a waterfront property currently listed that has seen a little interest from offshore buyers. Had it been listed in May, he said, buyers would be bidding at over the asking price. Now, they’re asking how much under the asking price they could get it for.

    “Foreign buyers are pissed off right now.”

    http://globalnews.ca/news/2943992/goodbye-vancouver-foreign-buyers-now-flooding-seattle-and-toronto-real-estate-markets/

  13. Mako: should have read not familiar enough rather. The rapid escalation of prices in the last few years have left me with a bit of concern.

  14. Markos:

    At the right price I would consider buying two or three investment properties. I am just familiar enough with the Victoria market and I have divested the properties in Toronto finally.

  15. When we lived in Calgary a few years ago the thought was real estate would go up, up, up look at the new stats: https://www.zolo.ca/calgary-real-estate/southwest-calgary/trends

    As much as I appreciate Zolo adding to the conversation, they are highlighting noise and hiding trends. Their headline number is that average price went down 19% in one month. Does that mean anything at all? Nope. Average price went from $528,000 in January to $453,000 one month later. Few months later it was back to $540,000. In other words, this is meaningless noise, and highlighting it means their “trends” page should actually be called “Mistaking noise for trends”

  16. 10-20% price decrease as is being reported is a mild correction at best

    10-20% in a couple months is definitely not a mild correction. Let’s see where it stops before calling it mild.

    in a down season no less. I know you guys say that there’s no ‘down season’ in hot markets, but people only have so much time on their hands. Fall is busy. Seasonality is real.

    Seasonality is definitely real, but there isn’t really any seasonality in prices that I’ve noticed. Prices don’t generally go down in the fall / winter.

    the 30% rise year over year in Van would have killed the market dead. It didn’t

    Huge difference between a tax of 15% and a price increase of 15%. Tax of 15% suddenly applied means the government is moving against foreign buying and won’t hesitate to torpedo more deals if it doesn’t work. That’s a deterrent. 15% price increase means a hot market that people want to jump into. That’s fuel to the fire. Completely opposite effects on investor sentiment.

    The shock is from the uncertainty. Once a predictable market is established again, there’s no reason why things wouldn’t pick up

    Possible, but there is plenty of reasons why it wouldn’t pick up that quickly, the main one being that it seems to have been driven quite largely by foreign buying. Unless that comes back in spite of the tax, it might very well drop significantly more.

  17. The irony is “Bear Mountain” was a mountain bike paradise. If the developer was truly passionate about the place the could have kept a trail corridor which would have doubled as a nature corridor. Probably wouldn’t have needed to blow up the sacred Cave. The profitability didn’t mater anyway since he blew it all into bankruptcy and scandal. Golf is dying too. No golf pics on the front page of that marketing site. Oops.

  18. Ecooasis? Wow what marketing BS! Those lovely pics of nature jogs and mountain biking aren’t happening on BM. In fact you will most likely need to drive to those activities. Along with the thousands of others trying to drive off the mountain. Man there needs to be an emergency regional transportation summit now. In the last 20 years traffic has gotten 10x as bad and our population has barely grown. We even widened the highway during that time. The Mackenzie overpass will make a tiny dent in the problem. Building high rises on mountain tops on the other side of a major artery pinch point that is already clogged is crazy….

  19. JD/AG
    Pent up demand is a salesman cliche. If you can’t see the Vancouver chart as parabolic with a $300K drop as not a bubble begining to self destruct then you are either an agent or in complete denial.

    Victoria only went up from Vancouvers massive last gasp of foreign money and media driven FOMO. It’s obvious it’s subsided huge and will continue to decline. Foreigners are going elsewhere to safer places.

  20. Some more info on Bear Mountain. 2038 Troon Court, listed a couple of years back for $1,048,000. No idea what it sold for…now listed for 1.4 million. Meanwhile the long stalled condo at the end of the street is going to finally be completed. Ecooasis is calling it Elevate Landing…

    http://www.victoriabcrealestate.com/feature_sheets/346879.pdf

    https://www.realtor.ca/Residential/Single-Family/17398651/2038-Troon-Crt-Victoria-British-Columbia-V9B6R6

    https://bearmountain.ca/elevate-landing-page/

  21. JD – there’s a big difference between paying a market price that’s 15% higher, and paying a tax of 15% in excess of the market price. The tax is money lost – sell the property immediately and you’ll never get it back.

    As an investor, this completely changes the equation when buying a property.

    Personally I think that Vancouver is in for a major fall in real estate values over the next few years. 20-30%, probably more when adjusted for inflation.

    However, I don’t see that translating over to a drop in the market in Victoria. There is too much pent up demand here, too much internal immigration from within Canada. And as the statistics over the last few days have shown, there has been very little foreign buying here anyway.

  22. Hawk, if that were true then the 30% rise year over year in Van would have killed the market dead. It didn’t. The sales numbers for August may appear shocking but it’s not having nearly as much effect on the prices, and it hasn’t caused a meltdown or caused a huge panic. Bubbles are made of mentality, not fundamentals. August was a blip, in my opinion. The shock is from the uncertainty. Once a predictable market is established again, there’s no reason why things wouldn’t pick up. As foreign friends remind me, it’s still cheap compared to other places. If the US raises rates and we stay at ours (possible) then we get even cheaper globally.

    I’d add that your man Saretsky has called a 10-20% reduction in prices. Right in line with a 15% tax. Rational response, good proof of no bubble.

  23. JD , 15% is a big deal to foreigners who despise tax or exposing their personal business / shell companies connections to CRA. Policy changes have huge impacts on a flipper/ greed real estate obsessed society.

  24. I went to a couple of open houses today and was surprised to see no one else there unlike a few months ago were there were almost mob scenes at some places. Has any one else noticed less buyers about?

    Given you are planning on being buried in the back yard of your Rockland home what is the motivation beind going to open houses?

  25. caveat,

    No chance they do that. Cherry picking individual municipalities would be problematic on so many levels.

    I generally have no issue with the tax but it should have been done either federally or provincially. I think the suit against is frivolous as the legislation is not fundamentally prohibitive.

    I think all of it is a blip. 15% is not much in the grand scheme and it has not cause mass panic; no bubble burst behaviour. 10-20% price decrease as is being reported is a mild correction at best, in a down season no less. I know you guys say that there’s no ‘down season’ in hot markets, but people only have so much time on their hands. Fall is busy. Seasonality is real.

    Everyone here argues in circles because there’s too many terms too vaguely defined. Too many markets. Too many subjective metrics. Too much subjective product. I can look at the numbers and assume we have a perfect market out there with plenty of choice which always responds rationally to inputs and outputs. (Hint: We don’t). I can also look anecdotally around where I live and see that we’ve now reached a point where there’s huge real local demand for housing, and where family-appropriate houses in the core are mostly out of reach for even double income professionals. Basically, there’s a bunch of shit for a lot of money. It doesn’t mean that you can draw the conclusion that land prices will come back down because of slower sales.

    UBCM has issued a rather frank directive to munis in BC – find space for housing. You’re gonna see a tipping point soon where the need for affordable housing will trump the NIMBY SFH crowd. Maybe it will include federal housing strategy money, we’ll see. But, rowhouse, townhouse and 3br condo will be more prevalent here in the coming years. There’s already a huge shift to purpose built rental. Victoria is on fire at the moment. It’s running out of land regionally. Housing prices will only rise for the time being.

  26. I went to a couple of open houses today and was surprised to see no one else there unlike a few months ago were there were almost mob scenes at some places. Has any one else noticed less buyers about?

  27. JD – I think they could either change the community charter to let any municipality do the tax or they could write a provision that only applied in a list of communities.

  28. “I haven’t heard anything more on Mayor Helps’ request to Premier Clark to extend the foreign buyers tax to Victoria.”

    It’s a change to the Community Charter (Vancouver has its own) so to apply it to Victoria would mean that you’d have to apply it province-wide.

  29. “I have a 5-year mortgage coming up for renewal and I am going with a different lender for the next 5 years….I must have had to provide at least 30 plus documents so far. This is despite having a credit score of over 800, the condo is cash flow positive, and I have a solid income.”

    You could always throw them the “don’t you know who I am ?” line. 😉

  30. “Saretsky estimates detached prices in Vancouver are down 10-20%…”

    When that happens here, the cardiac ward will need more beds for the perma-bulls while agents go into denial/ass covering mode saying it only brings us back 5 years so no need to worry, just a blip etc.

    Bank watchdog is beefing up capital requirements for mortgage insurers

    “Canada’s top financial regulator is beefing up capital requirements for mortgage insurers to make sure they are adequately accounting for the creditworthiness of borrowers and fast-rising real estate markets.

    The Office of the Superintendent of Financial Institutions published a draft advisory for public consultation Friday that would force mortgage insurers to incorporate additional risk attributes when determining how much money to set aside to cover the loan, including the borrower’s credit score, outstanding loan balance, and the amount of time left to fully repay the mortgage.

    A noteworthy addition is a supplemental capital requirement for cities with “house valuation concerns,” said Jason Mercer, an analyst at Moody’s Investors Service who published an in-depth look at the residential mortgage market in June. He said boosting the amount of capital to be held against mortgages in hot real estate pockets with high price-to-income ratios mirrors measures introduced earlier for the mortgage portfolios of the country’s banks.”

    http://business.financialpost.com/personal-finance/mortgages-real-estate/watchdog-tightens-rules-to-help-mortgage-insurance-industry-weather-severe-but-plausible-losses

  31. Bach to real estate for a moment; are we reporting house sales when they go into contract or when they close. people are throwing numbers out there without defining what they mean by sales.

    We report when contracts go unconditional, not when they close.

  32. I mean 25% foreign buyers in Richmond is a lot considering that’s only what’s reported. I think the 15% tax has broken a form of underground currency there judging from the meteoric crash in volume of sales….

  33. -Hmm… mortgage broker commissions are generally the same for variable mortgages as they are for fixed.

    I stand corrected. Thought the lenders would throw in a couple of extra points on the fixed. They must make a lot more on the fixed mortgage penalties alone.

  34. LeoS, I bet that rise in foreign buyers in Victoria is significant and might signal things to come. I haven’t heard anything more on Mayor Helps’ request to Premier Clark to extend the foreign buyers tax to Victoria. My guess is that Premier Clark will slow play it to gather the revenue.

  35. Holy sh*t! That bar graph says it all. What happened to foreign buyers are only 3% of the market and hardly have an effect. I guess you really can’t trust what “they” say can you….

  36. Variable rate mortgages require qualifying under the benchmark rate, which at 4.64% is almost twice that of the most competitive 5 yr fixed.

    What do you think is the percentage of your clients that wouldn’t qualify under the benchmark rate but do get a fixed term?

  37. Just shy of 4% is a bit higher than I was expecting in Victoria, but sounds about right. So much for the idea that foreign buyers would flock to Victoria. If there was any hint of that happening the tax would immediately be extended.
    In that sense I retract some of my earlier statements about it being stupid to apply the tax to existing contracts. It may not be fair, but it was damn effective as a shock and awe tactic and to avoid demand just shifting to another city.

    http://www.theglobeandmail.com/news/british-columbia/data-show-drop-in-bc-foreign-property-buyers-since-targeted-tax/article32000190/

  38. @ Marko
    Variable vs fixed is just like real estate commissions, your average Joe just don’t take 10 minutes to think things through. Mortgage brokers make more commission on fixed mortgages (Mike, correct me if I am wrong); therefore, they pedal the 5 year fixed when clearly statistically and logically the 5-year variable makes so much more sense.

    Just like REALTORS® pedal that you’ll get top dollar for your home if you pay 6%100k+3%balance.

    -Hmm… mortgage broker commissions are generally the same for variable mortgages as they are for fixed. The reason it seems fixed rate mortgages are peddled more is that it’s a lot easier to qualify a borrower under a fixed rate. Under a fixed rate the borrower qualifies at the actual interest rate they will pay. Variable rate mortgages require qualifying under the benchmark rate, which at 4.64% is almost twice that of the most competitive 5 yr fixed.

  39. @cs, Trump isn’t in charge of “running” the economy (maybe ruining it though)
    “Just four months ago, Donald Trump said he had ‘great respect’ for Janet Yellen, and warned raising rates ‘would be a disaster’ ”
    http://blogs.wsj.com/economics/2016/09/12/donald-trumps-shifting-words-on-interest-rates-and-janet-yellen/

    Trump: “I am a low interest-rate person. If we raise interest rates and if the dollar starts getting too strong, we’re going to have some very major problems.”

    Trump lives in the land of “today’s emotions” only, because he doesn’t have the capacity to think about the past or future.

  40. Funny how we didn’t get nearly as much discussion about our own election here 🙂 The US is just more interesting. Better real estate crashes, better elections.

  41. @ Marko Juras

    “Sell in Oak Bay while the market is high and buy 20 acres out in Sooke`

    Never miss a chance to generate some sales, eh, Marko.

  42. I have a 5-year mortgage coming up for renewal and I am going with a different lender for the next 5 years….I must have had to provide at least 30 plus documents so far. This is despite having a credit score of over 800, the condo is cash flow positive, and I have a solid income.

    Next time try to apply under your Croatian passport.. Might be easier 🙂

  43. @ Vicbot:

    “cs, now Victoria real estate and Trump are connected?”

    Oh, has it only just dawned on you that that is what I said in my first comment on this thread, i.e., at 12.32 yesterday. And I explained the connection: interest rates. Why? because (a) Trump has stated that interest rates “have to rise,” and (b) because Trump’s industrial policy would be inflationary and inflation would cause interest rates to rise.

    If you’re going to comment on what others have said, do try to pay attention to what it is that they’ve actually said, instead ranting on about votes for Hillary’s rotting corpse and other such like nonsense.

  44. Bach to real estate for a moment; are we reporting house sales when they go into contract or when they close. people are throwing numbers out there without defining what they mean by sales.

  45. But still, let’s not think of unpleasant things like a real estate crash or a Trump Presidency, which would amount to the same thing. After all, nothing worse than WW3 can possible happen if Hillary gets the chance to go after that evil Putin monster.

    Yes, best to plan for the worse. Sell in Oak Bay while the market is high and buy 20 acres out in Sooke so you can grow your own food when everything collapses.

  46. cs, now Victoria real estate and Trump are connected? Trump supporters always seem to make these connections between unrelated things and timeframes – losing all historical context.

    eg., Uranium One was approved by Canadian gov’t & US agencies before Hillary ever signed off on it, and at the time the US was trying to form stronger ties to Russia.

    If we’re competing on a “who is worse” basis, Trump’s actions are both dangerous to international treaties & illegal: He actively encourages Putin to invade Baltic States & hack US servers, and illegally takes donations for his “charitable foundation” to settle his legal problems. (See Washington Post)

  47. The professionals giving him a 40% chance are missing this trend?

    We seem to be arguing about the meaning of “quite likely”, which seems pointless.

    Incidentally, Vicbot, did you know that Hillary had what some present called a Hitlerite meltdown after her poor performance with Trump in the Commander-in-Chief forum, throwing a glass of water at one staffer’s head and referring to another as a brain-dead buffalo. Not very nice, really.

    But still, let’s not think of unpleasant things like a real estate crash or a Trump Presidency, which would amount to the same thing. After all, nothing worse than WW3 can possible happen if Hillary gets the chance to go after that evil Putin monster.

  48. There are many polls, suggesting a wide range of possible results. The professionals now give Trump’s a better than 40% chance of winning. Given the trend for Trump has been up for weeks now, a Trump win looks quite likely.

    So what you are saying is because Trump is improving in the polls for weeks now the trend will continue and he will quite likely win? The professionals giving him a 40% chance are missing this trend?

    I guess we can apply the same logic to the real estate market in Victoria…..it trended upwards this year so it can only go up next year.

    Trump supporter logic summarized in this video in 15 seconds.

    https://youtu.be/-ULEL8qwoII?t=2m34s

  49. if you think any guy that bullies, and disrespects and insults all people – including women and minorities – has any balls or human decency to run a country better than Hillary, then that says a lot about you.

    I only disputed your contention that Trump would be worse than a rotting corpse. Does that really make me so bad?

    Anyhow, why’s Hillary so great. She’s for North American Union. Is everyone on board for that? Open borders from here to Chiapas?

    Um, well yes, I suppose they are, since ten or twenty million Mexican and Americans fleeing Mexicans flowing into Canada would do wonders for RE prices in Victoria, although it would surely have a negative impact on wages.

    Oh, and Hillary, as President of United North Amerika, will no doubt be glad to sell off our resources to the Russians or anyone else for a suitable kickback, just the way she traded 20% of US Uranium production to the Russian state owned RosAtom for a kickback of 150 million to the Foundation. The foundation, incidentally, donates all of 5.7% of its revenue to charity, mostly for AIDS drugs of questionable effectiveness, while funding the Clinton lifestyle to the extent of over $50 million just for executive jets.

    Still Hillary is not Trump, that’s true.

  50. A poll came out this morning showing Clinton up 6% over Trump. Realistically Trump has a 25% chance which is not my definition of “quite likely.”

    There are many polls, suggesting a wide range of possible results. The professionals now give Trump’s a better than 40% chance of winning. Given the trend for Trump has been up for weeks now, a Trump win looks quite likely.

    But who knows. Maybe Trump will be assassinated by a real estate agent.

  51. Any chance of getting back to the real estate market and not the American election? Seriously, does anyone have a feel for the market in Bear Mountain

    Bear Mountain is pretty hot if you ask me….you have brand new 2,900 sq/ft homes on 7,000 sq/ft lot selling for a million. You can find something close in the core areas like Oaklands for $1.1 to $1.2 and I would gladly pay the extra 200k to be in the core.

    Some of the re-sales have been Oak Bayish type increases too.

    Just last week 2171 Spirit Ridge Dr sold for $2,125,000. It was purchased in 2010 for $1,485,000 and I thought that was an impressive number back then.

  52. Overall I’m quite impressed with the governments regulatory directions recently on credit quality. They have been tightening regs on CMHC and lenders for 8 years now.

    I have a 5-year mortgage coming up for renewal and I am going with a different lender for the next 5 years….I must have had to provide at least 30 plus documents so far. This is despite having a credit score of over 800, the condo is cash flow positive, and I have a solid income.

  53. More regulatory tightening. http://business.financialpost.com/personal-finance/mortgages-real-estate/watchdog-tightens-rules-to-help-mortgage-insurance-industry-weather-severe-but-plausible-losses

    Overall I’m quite impressed with the governments regulatory directions recently on credit quality. They have been tightening regs on CMHC and lenders for 8 years now.

    The massive gaping hole they don’t seem to have addressed is fraud and money laundering to foreign buyers. Unfortunately that hole may be big enough to make the other efforts insignificant.

  54. Bear mountain is fine if you work in Langford. Victoria? No way. But I’m one of those supposedly nonexistent people that care about walkability/bikeability and will not under any circumstance waste my time commuting in rush hour in a car.

  55. Barrister,
    Last time I looked around the BM listings there are still million dollar places with the best of views that are still for sale from almost 2 years ago. That tells me the local sentiment when I see that. The crawl will always put a lid on that area, especially with more lots opening up in many areas.

  56. Dear Hawk:

    I was up there four years ago when I was house hunting and boring was exactly my take on the project and a bit overpriced considering the location. But different strokes for different folks. I was wondering if it is selling at the moment though. When I looked at it there seemed to be a forest of for sale signs everywhere you looked.

    I live in Rockland and there have been a few new listings around my place but they also seem to be selling very quickly. on the other hand there have been a few that have been on the market for months on end and in a couple of cases for a few years.

  57. Correct me if I’m wrong but Oak Bay listings have doubled from a week ago and SE listings got a small pop as well.

    Barrister,
    Bear Mountain has a major PGA golf tournament getting world wide exposure this weekend. If this can’t get it going then nothing will. Maybe go put in a low ball bid before Sunday and see what happens. It’s a tainted project with a trail of bankruptcies and every house looks the same no matter how big. Boring.

  58. Any chance of getting back to the real estate market and not the American election? Seriously, does anyone have a feel for the market in Bear Mountain

  59. I read that if Trump had taken his inheritance and invested it in the S&P 500, he would be considerably richer than he is now. So much for the great businessman. All that leverage and all those deals, yet he still can’t beat an unleveraged investment in the stock market.

  60. My favorite Trump interview from earlier this year was went Trump said his dad gave hime a “small load of $1 million,” or inflation adjusted about $8,000,000 in 2016 dollars.

    Trumps accomlishment in life has been being born rich and staying rich.

  61. Caveat, it’s known as cognitive dissonance. You want me to be a bear so everything you read must be read in a bearish manner.

    I don’t know how you can read my comments as being bearish when I say that our market is stable relative to the current Vancouver market volatility. I’ve also talked about where to buy and what to buy if you want to cash in on appreciation and how to be aware of not paying over market value . Sure I may be more orientated towards protecting buyers but sellers have an entire industry supporting them.

    I think sellers are quite safe.

  62. CS, if you think any guy that bullies, and disrespects and insults all people – including women and minorities – has any balls or human decency to run a country better than Hillary, then that says a lot about you.

  63. My point was simply that (a) Trump will quite likely win, and (b) if Trump wins the residential RE boom may end quite soon.

    A poll came out this morning showing Clinton up 6% over Trump. Realistically Trump has a 25% chance which is not my definition of “quite likely.”

  64. Correction

    Foreign Nationals – $1,425,463
    CND/Permanent Res – $1,235,353 (A 15% difference?)

    Out of town buyers typically will pay 2 or 3% more than a local buyer not 15%. Just because they are unfamiliar with the areas and prices. The reason why it isn’t more is because the asking prices are set by most of the agents at a few percentages over market value to encourage offers.

    Other things that make a buyer pay more for a home include:
    -staging
    -recently completed renovations
    -new construction

    You will pay a premium over market value for these things. A premium that disappears the moment you drag a chair across the hardwood floors or nail a picture into the wall. But they are not cumulative in nature either which means by doing everything on the list that improves the price you’ll not get 8 to 12% more for the property.

  65. “97 per cent drop in the number of foreign buyers in Metro Vancouver after the tax came into effect.”
    http://www.timescolonist.com/news/b-c/near-collapse-in-foreign-buying-of-metro-vancouver-real-estate-1.2349072

    Something else that might have an effect is the extradition treaty Canada is negotiating with China:
    “The top-level Trudeau adviser overseeing a possible extradition treaty with China told the previous government that China’s so-called “economic fugitives” don’t belong on Canadian soil … China has mounted a vigorous international campaign to hunt down alleged economic criminals on foreign soil it says have absconded with millions of dollars of assets” http://www.cbc.ca/news/politics/china-security-adviser-economic-fugitive-1.3771481

    (lots of that cash is in Vancouver, as reported by lawyer Christine Duhaime, and G&M, SCMP, etc)

    In the Pundits article Leo S posted, David Eby also said, “people who were claiming that international buyers are only three to five per cent of the market hanging their heads in shame”

    How ironic that the heads of TREB and OREA are now saying that a foreign buyer tax would be “a knee-jerk reaction to a problem which we do not fully understand.”

    Ignorance is bliss for TREB.

  66. Crazy considering that the dead and rotten corpse of Hilary would be 10x better president than Donald.

    I’ve heard of people holding their noses while voting for a less than ideal candidate, but voting for a rotting corpse. Wow!

    Not that I would disagree with anyone who says that Trump is an appalling candidate, almost as appalling as Hillary, in fact. My point was simply that (a) Trump will quite likely win, and (b) if Trump wins the residential RE boom may end quite soon. Americans, it seems, have a choice between Hillary and continued near zero interest rates to prevent outright depression plus continuation of the Neocon drive to smash Russia before it’s too late, or Trump and rising interest rates, the repatriation of US manufacturing and the reconstruction of national infrastructure.

  67. ?v=1469673365

    Conservative Outfitters seems like a credible source. ‘Specially with the Drudge rotating beacon.

  68. “Foreign Nationals – $1,425,463
    CND/Permanent Res – $1,235,353 (A 1.5% difference)”

    15% difference actually.
    Whoops.

  69. “@ BMan:

    Because he’s “confident in what certain currencies are about to do”.

    He’s “got to run” though, so there’s no time for him elaborate on his prediction.”

    One could make way more on currencies than Victoria houses if one was so certain.

  70. I am neither a bear or a bull and since I plan on being buried in my backyard I dont have a dog in this fight.

    But, Marko and Jack, and all others that are throwing stats out there can you please clarify what point are you using for sales. Are you counting the date houses are going into contract or are you using the date of closing.

    This is very significant if you are trying to measure the impact of the Vancouver tax. There would often be a month or two of delay between entering into contract and actual closing. If it is closing then the August sales numbers would reflect mostly houses that were put into contract in July before the new tax. In that case one would have to look at the September numbers to see the first signs of a impact.

    Further, the Vancouver purchase numbers would be more meaningful if we knew whether they were SFH or condos. The numbers would also be more meaningful if we had a breakdown of million plus Vancouver purchases. For example if half the Vancouver buyers were for a million plus then this would represent a very significant portion of the upper end sales. What they are buying is almost as important as how many are buying. For example in July 2016 there was 86 Vancouver buyers and if half were a million plus then this would be a pretty significant percentage of the million plus homes sold. I am not saying that it was half, rather the fact is it would help to get a feel for how much money is actually been spent by people from Vancouver.

  71. @ BMan:

    Because he’s “confident in what certain currencies are about to do”.

    He’s “got to run” though, so there’s no time for him elaborate on his prediction.

  72. Just Jack
    “If you just want to be a contrarian troll then …”

    Says the fellow who has been a downer on the market since Douglas was a governor and not a street

  73. “You seem to want to use a year over year comparison…..”

    Yes, because 30 years of statistics strongly support seasonality.

    This time last year things were already hot too.

    Sept 2010 – 395 Sales
    2011 – 458
    2012 – 419
    2013 – 487
    2014 – 565
    2015 – 704
    2016 – 750 (approx)

  74. @Michael – why would you expect more foreign buyers? They seem to like cities. Hence, foreign demand has now shifted to Seattle and not Victoria. Or are you anticipating Seattleites cashing out and retiring here? I’m curious.

  75. August 1st-Sept 22nd, 2015 – 58 Vancouver buyers
    August 1st-current, 2016 – 74 Vancouver buyers

    Surprising that Van buyers are up that much over last summer (post-tax). I expect them to keep rising next year, along with foreign buyers.

  76. “Barrister, the bulls loved to use Vancouver price effect as”rippling across the water” all the way up, but when the shoe is now on the other foot, there apparently won’t even be a single ripple. Faulty logic if you ask me.”

    Very true. Now we are hearing that it’s only the high end* of the market crumbling in Vancouver, which will have no effect here. 8 months ago, it was Vancouverites cashing out their high end properties and moving their boatloads of cash over here.

    *See, for example:

  77. “A potential 50 to 60 percent drop in sales to Vancouverites by the end of the month. OUCH!”

    Who ever accused a salesman of cherry picking his numbers ? 😉

    Barrister, the bulls loved to use Vancouver price effect as”rippling across the water” all the way up, but when the shoe is now on the other foot, there apparently won’t even be a single ripple. Faulty logic if you ask me.

  78. You seem to want to use a year over year comparison which no one is using to show the effect of the tax. They are all using a month to month comparison showing July pre-tax and August after tax of the same year.

    What the year over year conveniently misses is the increase in Vancouver buyers in the spring.

    Month Sales, Number of Vancouver buyers 2016
    Jan 28
    Feb 31
    Mar 76
    Apr 89
    May 79
    Jun 83
    Jul 86 -pre-tax
    Aug 53 – after tax
    Sep 21 projected at 35 for September

    A potential 50 to 60 percent drop in sales to Vancouverites by the end of the month. OUCH!

  79. @ Bman

    “Winter is coming”– John Snow

    Sorry could not resist (no idea where the market is going since my wife is using my crystal ball for a paper weight).

  80. “Probably will be the case in coming months but is not the case currently.

    August 1st-Sept 22nd, 2015 – 58 Vancouver buyers
    August 1st-current, 2016 – 74 Vancouver buyers”

    How many are SFH’s verus condos ? These could be the tail end of those who sold by end of July and have taken a month or two of hunting here.

    How many people left Victoria to move to Vancouver or up island ? I’m sure the VREB might not want us to know that stat.

  81. “In a cooling market, is it typical for the low end to crack first? I would think it would be.”

    I believe it would Bman. Think of all the landlords who bought a year or so ago and now see the possibility of losing out on that easy $100K or so and decide to hell with the landlord thing, I want the cash. They would be the first to flood the market with the low enders.

  82. While there are fewer Vancouverites buying properties in Victoria since the tax was implemented it has not been a game changer for Victoria.

    Probably will be the case in coming months but is not the case currently.

    August 1st-Sept 22nd, 2015 – 58 Vancouver buyers
    August 1st-current, 2016 – 74 Vancouver buyers

  83. The deferred offer or blind auction is still being trotted out by mostly the same Victoria and Oak Bay agencies.

    As a prospective purchaser there isn’t much you can do. You could try a bully bid at slightly above market value price before the day of the auction with a time clause for the owner to accept the bid or you can put your best bid in at the time of the auction and never counter.

    But you should never get caught up in the back and forth action of an auction. You will either not get the property or pay way too much over market value. Either way you look at it, bidding and counter offering on a blind auction is too costly on your emotional health.

    https://youtu.be/QALu_tj1skU

  84. “Because Vancouver buyers never had any significant impact on our prices in the first place except to scare Victorians into paying more.”

    Which is why it’s a game changer of the local market psyche due to the false hype by the media and real estate industry that fueled the FOMO movement. The industry lied and still are to create sales or they don’t eat, as they’re not out to look after your well being.

    AG, I imagine as an ex-financial advisor you would guide all your clients into an over valued stock with thin bids and asks on declining volumes when the parent company is tanking due to new industry rules that have only just begun.

  85. Foreign Nationals – $1,425,463
    CND/Permanent Res – $1,235,353 (A 1.5% difference)

    Out of town buyers typically will pay 2 or 3% more than a local buyer. Just because they are unfamiliar with the areas and prices.

    I wasn’t getting at that angle……I was getting at the angle that the media has been reporting that the foreigners are buying up the $2 – $10 million plus properties which can’t be the case if the average this close. Obviously a fair share of CNDs is buying the mansions too given the close average.

  86. Of course if Donald Trump (now leading in most polls, while Hillary wilts, literally) wins in the US

    Most credible sources still have Hillary in a very strong position?

  87. “Where’s all the massive bidding wars and packs of high end cars looping the blocks at every open house we all heard on here daily? Long gone…”

    The last open house I went to was on Saturday, and I found it oddly quiet given the relatively low price. The main floor was a bit of a dump and rented out, but it had a nice illegal basement suite that was also rented out. I expected there to be a wave of amateur investors in attendance, as that was the case last year (around the same time), when I attended an open house for a mega dump, gut job of a house on that same street and it had 4 offers on it that day.

    My single anecdote (and just keeping an eye on what is selling through the listings I get), confirms for me that the low end has cooled off. Gone are the nasty bidding wars and absurd over-payments for complete junk. To me, it feels akin to late summer, when that first chill of autumn air moves in after the sun goes down. Your first instinct is to deny it, but the nights keep getting cooler, and you know that summer’s end is near.

    In a cooling market, is it typical for the low end to crack first? I would think it would be.

  88. While there are fewer Vancouverites buying properties in Victoria since the tax was implemented it has not been a game changer for Victoria.

    Because Vancouver buyers never had any significant impact on our prices in the first place except to scare Victorians into paying more.

  89. Governments will be extremely cautious about any action that might undermine the RE market. Residential construction currently accounts for around 6% of GDP. Canada’s GDP shrank 0.4% during the quarter to June 30. So a slump in house prices and, therefore, home construction would send the economy into recession or depression. What that means is ever lower interest rates forever, or at least until oil prices pick up. It also means ordinary folks having to borrow a million or two for a clapped out shack in Oak Bay. That’s the price of continued prosperity.

    Of course if Donald Trump (now leading in most polls, while Hillary wilts, literally) wins in the US, interest rates will rise anyway, and Justin Trudeau will be approving pipelines in all directions to ensure the greatest quantity of bitumen gets to market to offset the impact of a housing crash.

  90. Foreign Nationals – $1,425,463
    CND/Permanent Res – $1,235,353 (A 1.5% difference)

    Out of town buyers typically will pay 2 or 3% more than a local buyer. Just because they are unfamiliar with the areas and prices. The reason why it isn’t more is because the asking prices are set by most of the agents at a few percentages over market value to encourage offers.

    Other things that make a buyer pay more for a home include:
    -staging
    -recently completed renovations
    -new construction

    You will pay a premium over market value for these things. A premium that disappears the moment you drag a chair across the hardwood floors or nail a picture into the wall. But they are not cumulative in nature either which means by doing everything on the list that improves the price you’ll not get 8 to 12% more for the property.

  91. I wonder how many times you’ve said that over the past few years

    It’s becoming increasingly clear that the foreign buyer tax definitely is a game changer. In Vancouver.

  92. I am surprised at how low the spread in terms of average price purchase is between foreign nationals and permanent residence is in Vancouver. I thought it would be bigger with all the media reports of foreigners buying in the 5 to 10-million-dollar market.

    Foreign Nationals – $1,425,463
    CND/Permanent Res – $1,235,353

  93. These numbers are absolutely bonkers. Govnt data out today : From June 10 – Aug 1, gov. says 25% of buyers/sellers in Richmond were foreign, 24% in Burnaby, 15.5% in Vancouver.

  94. “There’s no doubt that the tax is gong to have a major impact on high end Vancouver sales, but it’s not going to have much effect here.”

    But the bulls said they were all coming here by the boat loads. What will Tony Joe do now ? There’s always seniors from Ontario I guess. 😉

    The only reason Victoria went stupid this past year is because of foreigners flooding billions more than usual which caused the “sell out now to move to Victoria” hype show pumped up by the media every night on the news, or in the local rag, causing the FOMO to lose their minds. Damn right it will have an effect here once reality sets in. Right now the bulls are in denial mode.

    Where’s all the massive bidding wars and packs of high end cars looping the blocks at every open house we all heard on here daily ? Long gone, because the big money is leaving BC by a billion per month that drove this bloated pig. Money launderers and tax evaders don’t like to be scrutinized of their business if you’re a foreigner. This is a game changer.

  95. If you want to add something positive to the conversation caveat then do so.

    If you just want to be a contrarian troll then …

  96. Understood about living close to an ambulance dispatch 🙂 But another big factor is access to regular heart health services & cancer care. With new procedures & drugs developed in the last 10 years, people are living longer at home, and they need regular (sometimes monthly) visits to hospitals and care facilities, and that’s why they tend to like living in population centres with those services.

    I’ve seen people living 10-15 years longer than they otherwise would have (and very active, productive members of society) just because of the recent progress made in heart, stroke, and cancer care.

  97. ” You’re in one of the only cities in Canada that built houses with only two bedrooms on the main floor and under 1,000 square feet”

    Seriously Jack are you trying to make us believe that you have never left Victoria? What about Vancouver, Edmonton, Calgary, Saskatoon, Winnipeg, Toronto, ….., all with thousands of post war bungalows with 2 BR main floors and less than 1000 sq ft.

    “The lack of walk-ability is not much of a concern to most of us..”

    Yes, ignore all those posters that go on at length about how important walkability is and the premium paid for walkable neighbourhoods.

    “as we are a nation of car owners.”

    Owning a car is not at all incompatible with desiring a walkable neighbourhood. Maybe the walkable neighbourhood lets the family of four easily meet their needs with one car rather than needing two, or save money by only using the car for weekends and major errands

  98. So… outside of Vancouver, foreign nationals accounted for 3.6% of sales before the tax and 1.7% after.

    There’s no doubt that the tax is gong to have a major impact on high end Vancouver sales, but it’s not going to have much effect here.

  99. The lack of walk-ability is not much of a concern to most of us as we are a nation of car owners. If you are disabled it is of major concern but I bet most of you don’t shop at the nearest grocery store. You get in your trucks and cars and drive to one across town or even to Langford.

    One of the things that I hear the more senior of our society say is that they moved to be closer to a hospital. But you shouldn’t move closer to the hospital you should move closer to the ambulance dispatch. Because you could live across the street from the hospital but no doctor is rushing over to your home from the emergency room. You’ll have to wait for that ambulance.

  100. There seems to be enough inventory both active and new listings being added to keep median prices from increasing. The number of listings may seem low relative to previous years but it seems adequate to keep median prices from rising.

    While some may be disappointed by the quality of housing, that is nothing new. Victoria has always had crappy houses built by handymen and some bad builders. You’re in one of the only cities in Canada that built houses with only two bedrooms on the main floor and under 1,000 square feet which by Canadian standards and bank regulations is sub standard. Years ago lenders had to have any mortgage on a house with less than 850 square feet on the main floor insured because they were considered riskier loans.

    The median or average family is not buying their first house to day with a small down payment as in the past. So is it fair to compare a family buying a home today with a $200,000 down payment to a family 15 years ago using a $25,000 down payment? The price to income ratio is going to be completely different but yet both families are paying similar monthly mortgage payments. However, that means the potential pool of prospective buyers that can buy a house today is also smaller. Every time prices increase that pool of potential house buyers gets smaller.

    Low down payment first time buyers are restricted to the condominium market and that puts a cap on condo prices. You can’t get blood from a stone. Most just can not financially afford to pay more. I suspect that inability to pay more has now moved into the detached housing markets and that’s another reason why median prices have remained flat for the last six months.

    The condo and the detached house market are sub markets and mostly do not compete with each other. Except when you look at new condo prices versus old starter homes in the same areas having around the same floor area. Today a new 940 square foot condo in the core will set you back around $400,000 but a starter house costs $520,000. That is suggestive of a market driven not by first time buyers but by investor/speculators buying up land. Most of whom are not in the market for a long term but short term profits. The difference also may give an indication of how much the detached housing market might be over priced today or how under priced condominiums are? Although I suspect it is the former.

  101. @Bingo:

    The hotel might not want to have a grocery store or local pub competing with its overpriced everything. Wonder if there is a covenant that prevents a plaza development?

  102. @barrister
    Some people just want something shiny and new with a warranty. See how many dodge grand cavarans are driving around? Compare a 3 year old Dodge to a decade old Honda. The Dodge will have all the bells and whistles, the Honda will be free of rattles.

    I can’t get beyond the lack of walkability at BM. There are other issues, but that is the biggest for me. Currently I can walk to liquor, groceries, coffee, drugstore etc. BM you have the golf course/resort and its limited amenities. Everything else is a drive down the hill.

    One of my friends lives in a golf course community in the US. Way more amenities. Of course it has been around longer.BM is still young.

    Can you legally drive golf carts around the neighborhood at BM? At my friend’s we hop in his cart to go get beer at the neighborhood store. Completely legitimate. They don’t want to make you walk or drive your car for your tee time.

  103. @Just Jack:

    You have a pretty good point about the size of the inventory for SFH in the million and up range.
    In James Bay, Fairfield, Rockland, Oak Bay and Fernwood surprisingly there are only a handful listed under 950K. There is a fair number over a million. How many families salaries can support a million plus purchase here in Victoria? That was a serious question since I have no idea.

    By the way, according to Stats Canada, the median retirement age in Canada is now 61.8. At the same time people are living a bit longer. We have had a lot of house sales in the last couple of years. I am wondering if some of the low inventory is simply because there are more younger retiree’s whose houses will not be on the market again for another 15 or twenty years.

    My impression is that a fair number of houses that were rental properties have been bought by people who plan to use them as primary residences. That source of inventory may have been exhausted at this point.

  104. I looked at a number of house at Bear Mountain and was not overwhelmed by the quality of construction. What surprised me though is that the developer had not bothered to build a small local plaza or any meaningful community center like a library. Everything required you to drive down the hill. I think they missed a real opportunity to create a village center with the feel of a real small town about it. Personally I felt a sense of cold isolation up there. Unlike some people here, I am not an expert on construction techniques but I saw too many flaws in the finishing work.

    I have not been there for about four years; does anyone know how these houses are holding up.

  105. Vancouver is going to count AirBnB units as vacant for the purpose of their new tax. http://www.cbc.ca/beta/news/canada/british-columbia/vancouver-airbnb-empty-homes-tax-1.3771725

    Great, finally someone is doing something about it (control AirBnBs in Vancouver), hopefully the rules will come to Victoria soon. Just checked, there are about 300 (entire) apartments on AirBnB between $75 and $150/night alone, not sure where the business comes from for Victoria AirBnB in Winter?

  106. Houses on BM remind me of Chrysler vehicles…they arguably look good on the outside, but their build quality underneath is terrible.

    So AG, you may not be far off in your guess. They were hiring anyone off the street to build those things…

  107. confidence in what certain currencies are about to do

    I too have discovered a truly remarkable crystal ball which this comment section is too small to contain.

  108. Wow. 10,000 on BM. That will screw us all. We need the train now…. So glad I’ll have to Goose. Driving through the tail end of the crawl is crazy. Mackenzie is backed up for miles. With BM and Royal Bay and all the other developments on the other side of that the train should be a huge priority…. Too bad sewage has taken all the money.

  109. I find the idea of a train emotionally appealing but I wonder how practical it actually is. Unlike Toronto
    and New York, Victoria does not seem to have many jobs concentrated right downtown. Perhaps a better solution would be to move some of the provincial government jobs to Langford or even Nanaimo.

    A lot of the jobs seem to be up in Saanich. But maybe someone has some actual numbers for that.

  110. Could you explain this no brainer? I’m curious why you are so confide tin that prediction.

    Starts with confidence in what certain currencies are about to do. I’d expalin more but I have to run.

  111. It’s a nobrainer that prices will start heating up again over the next several months.

    Simply because it’s the opposite of what JJ predicted?

    Sounds like there is plenty of inventory in the million+ range.

    How many SFH in greater vic below 600K? A handful and most in the western communities?

    What if one were to stretch that to 700K and exclude the western communities? Probably about as dire.

  112. Micheal what do you mean by opposite. Are you saying the months of inventory is going to decline over the next few months?

    Because here are the monthly base numbers to compare with at a later time.

    Month Months of Inventory
    Jan 4.47
    Feb 3.16
    Mar 2.27
    Apr 2.03
    May 1.81
    Jun 1.91
    Jul 2.24
    Aug 2.35

    And the median prices

    Month Sale Price, Median
    Jan $451,200
    Feb $490,000
    Mar $500,500
    Apr $520,000
    May $503,900
    Jun $500,000
    Jul $499,000
    Aug $483,500

  113. Now the trend will be to build inventory over the next several months and then prices will begin to moderate lower.

    As per usual, I’ll predict the opposite of Jack. It’s a nobrainer that prices will start heating up again over the next several months.

  114. As prices continue to increase fewer people can afford to buy. And that has been happening since the volume of sales peaked in May. And while some of the declining sales may be attributable to the season we have seen some remarkable drops in sales volumes just recently. More so than any other time in the last decade.

    For example last year from peak sales to August the volume of sales declined 20 percent. This year the decline from peak sales to August was 33%. And this month the drop will be even more from peak sales closer to a 45% drop and by the end of the year the fall in sale volumes could be as much as 65% from peak. That would be amazing and probably a record.

    As for new listings they also tend to decline at this time of year. Last year from peak listings to August the drop was 35% in new listings. This year the drop has been 31%. The level of new listings in September is likely to be similar to most years in the range of 900 to 1000. That might bring our months of inventory to the third highest of the year. Only in January and February were the months of inventory higher.

    So when people say there isn’t anything to buy that’s not exactly true what they are saying is that there is less to buy in their price range. Because when you get over a million there are 351 current listings but only 69 properties sold for over a million last month. You just have to walk into your boss’s office. Look her dead in they eye and tell her you can’t afford a million dollar home on your wages and then demand that 20 percent increase in your salary or you’ll quit and get a better one.

    Let us know what happens?

  115. @ 8Gate – lowest 5 year variable right now is 1.99%. Why would I complicate my life with interest rate parlor tricks to lose flexibility on my option to lock in and pay a higher overall interest rate?

    The cash back prepayment suggestion also seems dubious at best. It sounds like the sort of thing that folks do to either qualify for a mortgage they can’t afford or are coaxed into by a mortgage broker out for higher commissions on more expensive loans.

  116. I’m with Marko on variable vs fixed. Right now the gotcha is rates. Variable aren’t cheap enough. The spread has usually been a lot higher. To me that means the banks think there’s a greater chance of a drop than a rise in rates. If they thought BoC was going to raise rates and continue raising them, they’d want to temp more people into a closed term variable.

    Also on fixed vs variable. Fixed is nice for planning your finances, but if you plan on moving the penalties on a closed term fixed rate are nuts. I don’t know where I’ll be in the next 5 years. I can swallow 3 months interest penalty. Fixed penalties vary, but I’ve never seen any that low (unless you only have 3 months left in your term).

    Yes, you can possibly port your mortgage, but there are many instances where that won’t work and the timelines tend to be tight (I don’t want to be forced into another property).

    I have always been variable (both opened and closed). So far it has been cheaper. It’d take a lot of rate increases to eat up the amount I’ve saved by going variable. But I’m young and can stomach the risk. Some people like a predictable bill month in and month out. Fair enough. Every BoC drop I’ve kept my payments the same and watched my amortisation drop.

  117. “I thought that new inventory coming to market in the subdivision for the next 20 years would keep price gains on re-sales subdued.”

    Gotcha, I was surprised too but it will be short lived. With Bear Mountain announcing today they want 10,000 more people living there in the next 10 years you have to imagine the gridlock is only going to get worse and eventually turn people off of Victoria. Not putting in rapid transit on the train tracks is archaic thinking but this city wants it both ways.

    As Jack mentioned, the road system is in the dark ages and is not able to able to handle the increased density. Road rage is inevitable as bikers control main thorough fares like Shelbourne and speed freaks in cars think they can drive 70K in 40K zones. One over pass at McKenzie is not going to do anything though it is long over due.

  118. Thanks Leo. That graph is a good example why the often given advice “just get into the market” is bad advice. The usual logic given, that you are in the market so you will rise and fall with it.

    If your goal is a SFH and you bought a condo, your buying power is decreasing. We sold our starter condo during a contraction in prices between condos and houses (condos were hot for a short period during a lull in building). We lucked out and made some money on the condo. In hindsight had we stretched ourselves and bought a SFH we would be ahead equity-wise. Well.. had we been brave enough to stretch ourselves and buy in a decent area, which I don’t think we had the fortitude to do considering the crack shacks we would have looked at.

    It’s a similar situation between Saanich East and OB. If OB is your goal then the price to upgrade is widening. Good luck moving up from Langford to OB (despite any gains the western community has had). That Westhills appreciation is mind blowing. From what I’ve seen in mini-lot house prices they tend to mimic condos. A good hunk of depreciation the first few years. Who wants to buy your used hardiplank and laminate box on a tiny lot when they can buy a brand new hardiplank and laminate box with a full warranty on a different but no less desirable tiny lot?

  119. I would skip the variable mortgage in this environment and do a short term Mortgage (1 or 2 Years). The rates are better and it is effectively the same outcome as variable and technically more flexible (no penalty if broken on (bi) annual maturity.
    If you are worried about rates rising here is a strategy
    Let’s say a 5 year mortgage best rate is 2.44%. Do this mortgage at 3.44% and get 1% cash back (all the banks can do this) and lump sum it as a prepayment back into your mortgage. If you keep your payments the same, you are effectively paying your mortgage based on a rate that is a full percentage point higher than they are now.
    The real benefit is your effective rate on this 5 year fixed mortgage is 2.25% after you take into consideration the lump sum payment and the principle pay down.

  120. Speaking of traffic, Langford has a good idea with subsidized Greenline bus service for commuters into town:
    http://www.timescolonist.com/news/local/langford-to-launch-subsidized-commuter-bus-service-to-victoria-1.2347965

    A while ago when I did some eco research, this was identified as one of the most favourable ideas to solving commuter problems – free (or almost free) bus or train service with coffee, snacks, and amenities on board – it can cost less than building new roads.

  121. Interesting how a Toronto real estate lawyer says emphatically that a foreign buyer tax would be “devastating”, but not surprisingly TREB says there’s not enough data.

    Personally I think the data is already there (sitting with lawyers & banks), but the real estate board just isn’t too keen on anyone officially collecting it. They want to make the party last as long as possible.

    http://www.cbc.ca/news/canada/toronto/tax-on-foreign-homebuyers-would-be-horrible-toronto-real-estate-lawyer-warns-1.3771404
    “A Toronto real estate lawyer warns introducing a tax on foreign homebuyers would be devastating for the Toronto housing market …”if we had a slump in the market the default rate in mortgages across the board would be horrible,” Aaron said.

    JJ, agree that bike lanes along major arteries has seriously increased congestion, idling times, & pollution.

  122. How many would still be buyers if the market bottom falls out like Van ? I bet most would suddenly turn to wait and see’ers.

    Some would for sure, but there are also young couples looking to start families, for example, that just want to find the right place and are not trying to time the market.

    Right now I am not seeing the trajectory to the market falling out. I think there is enough pent up demand to take us until the new year. For the market to fall out we need some sort of spook shock like the Vancouver market experienced with the foreign tax. Without a shock we need a substantially inventory build from the current historically low levels which I can’t really see taking place until the spring, if it happens.

  123. Langford home prices have been steadily rising while median prices in the city have stagnated. As I have said in past posts the Westshore is a substitute for the city. As prices in the city become too expensive those that were contemplating buying in the city substitute the Westshore.

    And that will become more prevalent as the new interchange is built and rush hour commuting times drop substantially. It only takes 18 minutes to get to Langford from the city in non rush hour. The only reason why we have a rush hour at all is because the 13 cities and towns are not interested in reducing commuting times. And the way that I see it, most of their individual road improvements have led to increasing the commuting times by narrowing the streets, “traffic calming” and adding bike lanes along major arterial roads. And that’s why we are close to gridlock with such a heightened level of road rage in such a small city.

    Our entire road system is from the dark ages. I recently had a look at the traffic monitoring office at the public works yard. It consists of a shack, one person in overalls looking at a monochrome screen with only a few mounted cameras at key intersections. After seeing this relic of the past I am surprised that anyone gets to work on time. If the different municipalities co-operated we could be doing a vastly better job of reducing commuter times but there is no point in Victoria spending any money to make peoples’ lives easier because commuters don’t vote in that city.

  124. Variable vs fixed is just like real estate commissions, your average Joe just don’t take 10 minutes to think things through. Mortgage brokers make more commission on fixed mortgages (Mike, correct me if I am wrong); therefore, they pedal the 5 year fixed when clearly statistically and logically the 5-year variable makes so much more sense.

    Just like REALTORS® pedal that you’ll get top dollar for your home if you pay 6%100k+3%balance.

  125. Took 6 years to make 50K ? What’s so amazing about that ?

    I thought that new inventory coming to market in the subdivision for the next 20 years would keep price gains on re-sales subdued.

    Uplands isn’t growing and is actually way cheaper than the Westhills on a $ per sq/ft of lot size basis 🙂

  126. @ Marko – I did a ton of analysis on this before I bought as well.

    My take on it is this: Most variable mortgages can be paid out at any time for 3 months interest. Why not pay the variable rate as long as you can and then lock in when it makes sense to? (i.e. rates start increasing) Worst case, you pay less up front and then maximize the number of years your fixed rate shelters you from higher rates (you need to pay attention for this to work though). Best case, you pay the variable mortgage out and save 20% on interest payments for the life of your mortgage.

  127. “I’ve never had a book of buyers as big as I have right now. All the people left over from getting outbid in the spring+new clients. Inventory is non-existent.”

    How many would still be buyers if the market bottom falls out like Van ? I bet most would suddenly turn to wait and see’ers.

  128. “1292 Parkdale Creek sold yesterday for $540,000 – purchased brand new for $432k+GST.

    I find that more amazing than the Uplands teardowns going up 50-70%.”

    Took 6 years to make 50K ? What’s so amazing about that ?

  129. Mike and his little green arrows leave out the fact the S&P is 25% over valued with earnings on a decline. Not to forget the junk bond bubble that’s fricking scary and highest since 2008. Never mind, just keep buying Vic real estate, where prices never go down, just like Vancouver right ? 😉

  130. You laugh but your 5 year fixed is coming up for re-finance, what then? You are screwed just like your neighbour, but you bought an extra year.

    Exactly. The only safety you can possibly create is one of your own design: Consider not buying if you can’t handle interest rates at 2-3% higher than they are now.
    Made a mistake going with the 5 year the first time, won’t happen again.

  131. Never thought I was ever see price appreciation in the Westhills.

    1292 Parkdale Creek sold yesterday for $540,000 – purchased brand new for $432k+GST.

    I find that more amazing than the Uplands teardowns going up 50-70%.

  132. are the lower core detached house sales a reflection of lower available inventory than prior years

    I’ve never had a book of buyers as big as I have right now. All the people left over from getting outbid in the spring+new clients. Inventory is non-existent.

  133. I would strongly advise that you consider a five year mortgage at this point. Interest rates have nowhere to go but up. it is possible for them to stay basically flat but they really cant go any lower. The likelihood is that they will increase and possibly by a whole point or even two in the next couple of years.If you are planning in staying in the same house for a while the small extra cost of a five year fixed may end up being cheaper over the long run. Certainly it will give you some peace of mind not having to worry about a rate increase.

    I consider myself somewhat intelligent and I have never been able to grasp the “peace of mind,” or “security” of the 5 year mortgage.

    Let’s say you go with a 5 year fixed and your neighbour goes with a 5 year variable. Fairly safe to conclude that nothing will happen in the next year. In year two maybe BOC raises rates twice by a quarter and now you are even with your neighbour. Year three BOC goes up another full point and another point in year 4. Your neighbour is no longer able to make mortgage payments and folds. You laugh but your 5 year fixed is coming up for re-finance, what then? You are screwed just like your neighbour, but you bought an extra year.

  134. particularly the gorge area will start to see some real price increases

    It already did in the last 12 months. It is disappointing what 700k buys in the area these days, especially any of the street running perpendicular off the gorge.

  135. Definitely seems like the risks to the global economy is heating up…. So the question is, what to do with extra cash? Hang on to it, invest it in the markets, or pay down the mortgage?

    RE and equities are fine choices.

    Below is where we were back at the start of this year. Things looked risky 40 years ago too, yet recall how well Vic RE performed (up 160%) the decade following the mid-80s oil crash.

  136. particularly the gorge area will start to see some real price increases

    Agreed. No reason it won’t be at the same level as similarly proximate places to downtown. Especially the gorge being a lot more useful for recreation than any other oceanfront

  137. Getting away from Oak Bay, I have noticed a real price explosion in Fernwood and James Bay over the last couple of years. I tend to agree that over the next number of years that Esquimalt and particularly the gorge area will start to see some real price increases. On the other hand people who live by their crytal ball often end up eating glass.

  138. RE: Condos

    Generally speaking houses are a depreciating asset in some ways like cars but at a slower rate.
    ( yes, there are some exceptions when the cost of material and labour suddenly accelerates).
    But eventually the mechanical parts of houses do wear out and need replacement.

    It is the land under the house that really goes up. Condos simply sit on less land and therefore their increase tends to be slower on average.

  139. I’m thinking prices will keep trending upwards or at least stay stable so long as the HHV byline reads ‘the market is currently ludicrously hot’.

    In case anyone is wondering, it says that when the residential months of inventory is below 2. Since 1996 that has only happened on the following occasions:
    March 2004
    March and April of 2005
    March, April, May, June, July, and August of 2016

    So while it seems almost exaggerated to have “ludicrously hot” displayed month after month, it really is quite rare and has never happened for this long.

  140. We might still hit my prediction of 1.99% 5 year fixed loans yet.

    Quite possibly. Remember when the minister of finance flipped out about 3.99% saying it was irresponsibly low?

    my block of Armstrong cheddar keeps getting smaller and more expensive.

    On the other hand I saw cauliflower for 99c/lb.

  141. @Dasmo

    You are correct there has been inflation in all financial assets including housing. However, the CPI remain stubbornly low. Welcome to the world of low interest rates, QE and the creation of bubbles.

  142. @Curious Cat

    Don’t you know that most posters here are retired and have worked for 40 years haha. Hence the conversation around highly priced homes in WASPy areas in Victoria.

    On a more serious note, the probability of another decade of low interest rates seems high. Getting a variable rate mortgage would not be such a bad idea if succumb to that belief. It might shave 0.50% off your current rate.

    Would really like to see more affordable prices for young families in Victoria, but in the current economic environment; the odds are of that happening is small. If OB/Fairfield keeps at this level, there will be gains in other core areas such as Saanich West, Esquimalt, Vicwest, etc… So if you are looking at an income property those would be good areas to consider.

  143. I agree rates will remain low for a while. We might still hit my prediction of 1.99% 5 year fixed loans yet. However, I’m not sure I would agree we have low inflation when houses cost 30% more in just three months and my block of Armstrong cheddar keeps getting smaller and more expensive.

  144. Personally, I’m thinking prices will keep trending upwards or at least stay stable so long as the HHV byline reads ‘the market is currently ludicrously hot’. Exhibit A is the MOI numbers for last year – 5 months of inventory this time of year, etc.; recall that last summer was strong too in terms of sales and price appreciation – and then prices really shot up just a few months later.

    So yeah, I reckon any sort of current seasonal slowdown we’re seeing now means pretty much feck all.

    Note – I don’t think this is a good thing or a bad thing. I’m not an investor, and don’t really want housing to be totally unafordable here (too late maybe), but I also don’t think the sky will fall if there’s a wholesale shift to condos and apartment dwellings, as in most of Europe, over the next 20 years or so.

  145. @Leo S

    I agree with you, lower for longer. We have low inflation with little to know growth. A growing debt with low productivity is a recipe for deflation. The question is do we land in to a recession within the next year or two with an uptick in unemployment, which would most likely lead to a correction in housing. Or do we somehow avoid a recession with central bank disruption and fuel housing more. Either way the next logical in central bank policy is negative rates in Canada and the US, and helicopter money in Japan.

  146. It’d be interesting to see some comparisons between SFH, attached and condos. Has the heat in the home market put a big spread between SFH and other properties types

    Some stuff here: https://househuntvictoria.ca/2016/07/08/how-many-skyboxes-for-a-dirtbox/
    Appreciation in the price of the median SFH has been outpacing that of the median condo for as long as we have data. Could be due to the trend of building bigger houses but smaller condos. Could be because there’s a limited supply of land for SFHs but condos are almost limitless. Anyway it’s happening.

  147. Interest rates have nowhere to go but up. it is possible for them to stay basically flat but they really cant go any lower. The likelihood is that they will increase and possibly by a whole point or even two in the next couple of years

    That’s what everyone said 5 years ago. Then they went down some more. They can certainly go lower. The BoC expects low rates for a long time http://business.financialpost.com/news/economy/expect-lower-interest-rates-for-some-time-to-come-bank-of-canada-signals

    Personally I think we’re in for another decade of low rates. Any attempt to raise rates will throw this fragile economy off it’s axis.

    @CuriousCat – thanks for the info.

  148. Barrister,
    Don’t forget there is an auto loan bubble right now where anyone can drive a nice car these days. Paper profits as a measurement of real wealth can be fleeting when debt levels are at the extreme. Just ask Vancouver west siders who are taking it on the chin for 26% off.

  149. AG:

    Interesting to know about Japan. I am going to try reading a bit about their economy; it sounds like something is dreadfully wrong there.

  150. “Americans commonly get 30 year fixed terms (the rate remains the same for thirty years) and I have wondered why we cant. Does anybody know.”

    Because the US has a liquid 30 year bond market where banks can hedge their risk.

    Separately, mortgage rates can certainly go lower. Doesn’t mean that they will of course. But in Japan you can get a 10 year fixed mortgage at less than 0.5%.

  151. Hawk:
    it is possible that I hit Three Point at the wrong time but the booking person has said that they have been flooded with new clients in the last year when I asked her about it. When we first moved here about four years ago I noticed that there were not a lot of luxury cars compared to LA but I seem to have noticed a lot more in the last year. Far from scientific and I might be imagining it. But it seems to confirm the article that Victoria is the third most affluent city in Canada. (which is why I mentioned it in the first place).

    By the way is someone here familiar with Sidney. I looked up there as well four years ago; have prices shot up there as well?

  152. Agreed, the Oak Bay obsession thing is getting a bit lame. Either you can afford to over pay and get ripped off or you can’t. How’s Saanich East SFH looking Jack ? Are listings increasing there?

    Barrister, are you talking 3 Point for your car or the local garage? The latter has been much tougher the last few years as all the smaller guys get shut down. 3 weeks sounds pretty extreme.

  153. Barrister, I think we’re in the same boat – very shocked at what’s happened with prices and concerned that it’s driven by speculation, and how that affects local families. Appreciate your point of view.

  154. The blog is called house hunt Victoria, not condo hunt or duplex hunt. ( ͡° ͜ʖ ͡°)

    I’m not in the market either, but I’m curious what’s going on as a whole. It’d be interesting to see some comparisons between SFH, attached and condos. Has the heat in the home market put a big spread between SFH and other properties types like it did in Vancouver making it difficult to move up the ladder from one type to another?

  155. LeoS:

    Regarding mortgage renewals First shopping around is really important but make sure that you are comparing the same terms including the ability to pay down early.

    I would strongly advise that you consider a five year mortgage at this point. Interest rates have nowhere to go but up. it is possible for them to stay basically flat but they really cant go any lower. The likelihood is that they will increase and possibly by a whole point or even two in the next couple of years.If you are planning in staying in the same house for a while the small extra cost of a five year fixed may end up being cheaper over the long run. Certainly it will give you some peace of mind not having to worry about a rate increase.

    Americans commonly get 30 year fixed terms (the rate remains the same for thirty years) and I have wondered why we cant. Does anybody know.

  156. Curious Cat:

    Since you seem to have some difficulty in actually being accurate about what you read let me help you out a bit. I was not complaining about either the length of time to service the car or the cost of the Upland lots. I bought three years ago and am not in the market for a lot so I really dont care and since I am retired and dont drive a lot any delay in servicing my twelve year old car is a matter of indifference.

    But you are correct that I am not wild about the fact that so many homes seem to just be a speculators playground. I am also rather shocked that modest homes should be going for a million dollars. Virtually every home in Fairfield is now a million dollars; this was a great neighbourhood for average people a few years ago and now is virtually unaffordable.

    Since I live in Rockland this is the neighbourhood I know. Love to know about the rest of the city and what is going on in the market there. Perhaps you could consider being informative without attacking others.

  157. Hey Just Jack,
    How about duplexes? Nobody ever talks about duplexes here. Would you be able to tell us how duplexes have performed during this run-up vs. their single family counterparts…in, say, Victoria and Saanich East?

    I too am tired of the focus on Oak Bay.

  158. I would like to talk about other areas than Oak Bay. But it seems that all the bulls live there or want to live there and to them that is the entire real estate market.

    There are a lot of interesting things happening in other places. If you want to know something specific about your hood – just ask. I’d love to talk about some other place.

    Three weeks into the month and only 11 house sales in Oak Bay. Only 2 sold to Vancouverites. Meanwhile in the rest of Greater Victoria/world there have been 433 sales.

  159. LeoS, a couple blog posts back the topic of mortgage renewals came up and you were wondering about that as you hadn’t gone through one yet. I just went through my first mortgage renewal in 10 years (thanks to moving twice and doing a couple blend and extends) and you may find my experience interesting.

    First, my mortgage is with BMO. The renewal date is Feb 1/2017. I was expecting a call beforehand, but was REALLY surprised when I received a call from BMO in early July! Because I was currently in a 2 year mortgage, he first quoted me 2 year rate. Their posted rate of 2.99% (at the time) with a discount of 0.9 = 2.09%. I asked him what his 5 year fixed offer was: 2.54%. Their website had a 5 year rate of 2.49% but he said that had many restrictions and was not a conventional mtg with the normal paydown options. I asked about the 5 year variable and he offered prime minus 0.35% (2.35%). The earliest I could renew my mortgage without penalty was in August, so I informed the representative that it would be idiocy for me to pay a penalty to renew with him that day, and at the risk of losing the “awesome offer”, he could call me back in August. We set a date for a callback.

    A month later he called back when scheduled, and though the 2 year posted rate for BMO had increased to 3.19%, he simply increased the discount to 1.1% and I still got the 2.09% rate. I said lock it in, kept my payments the same, I didn’t have to sign anything, or go anywhere, the new documents came in the mail last week (mortgage came into effect Sept 1) and I stuck them in my filing cabinet. Surprisingly painless!

    My bestfriend who is building a house has been actively shopping around looking for a mortgage and thought my rate was so good, I gave her the name and number of the guy I spoke with and he quoted her the posted rates (3.19%). When she told him he gave me 2.09%, he told her that long-standing customers get preferential rates and if she wanted to know whether she would receive a discount, she would need to submit an application and credit check. She wasn’t quite ready to do that so she declined. So that’s my story, hope it helps!

  160. In the last few months, I have noticed that this blog seems to only be concerned with SFHs in Oak Bay and immediate surrounding areas, and all the discussion revolves around this million dollar house, or that 2 million dollar house which went over ask. The population and numbers of homes in Saanich (east and west) FAR exceeds those in Victoria, so why the laser focus? (I guess we could rename this blog househuntoakbay.ca?) Also, it appears that everyone who comments on this blog is now like the RedFlagDeals crowd on the Personal Finance Forums (where it’s a running joke that everyone makes $150k/yr income).

    Yes I’m talking about you Barrister, complaining about a 3 week wait to get your Mercedes serviced, or that the million dollar house across the street is looking a little shabby and how HARD it is to find a good knockdown for 750-850.

    Is no one else going to say anything? Really??

  161. @Nan

    I agree that the uplands have gone through the roof. I was looking at knockdowns there about three years ago and they were selling from 750 to 850. But if you want a high end home on a big lot ( alrge home were all the other houses have not been turned into apartments like Rockland) that is still close to town where else can you look?

  162. Does anyone have any thoughts on the 2 listings that popped up across the road from each other on Uplands road for $2.6MM a piece? The lists on those look insane considering the last house on that street went for like $1.3mm last year and for a little over an extra million you can get 2x the house (brand new no less) on 2x the lot one block over? Seems folks are aiming for Westside Vancouver prices in there!

  163. Wether the deposit was the down payment or not , how can anyone have a smidgen of sympathy. She’s the poster girl for excess lending in a bubble market that was in decline when she decided to plunk down all this “cobbled” money.

    China and Australia have no problem taxing foreigners, why should we ? Oh right, we’re Canadian and have to be politically correct.

  164. 617 sold very quickly; so fast that one wonders how they had time to even get all the offers in. Bought ny Mark Imoff, the real estate agent. Should we be expecting a quick flip??

  165. 617 St. Charles went for $1,050,000, 100k over ask. Assess was $784 but has some renovations. Quick sale too!

  166. The 10 percent was the deposit not the down payment.

    I see that now. Where was she going to get the rest of the money from if she had to borrow from family and friends the first 10%?

    Probably not the best person in terms of optics to be the face of the law suite.

  167. The 10 percent was the deposit not the down payment.

    They’re not arguing that is she not at personal fault for not mitigating her loss by making her offer subject to financing. She would have been told by her agent that a non conditional offer would be gambling that she could get financing. She knowingly put her non refundable deposit at risk.

    The argument is that BC and/or Vancouver does not have the right to tax non Canadians differently than Canadians. It’s a discriminatory tax. Again something that I had mentioned before on this blog.

  168. 109 house sales in the core so far this month. Last month we had 144 by this time. A year ago we had 118 by this time in September.

    This is pretty much what I thought would happen as I speculated that the increase in sale volumes where itinerant Alberta oil workers returning home and that wave of buyers would end and we would return to previous sale volumes.

    Now the trend will be to build inventory over the next several months and then prices will begin to moderate lower.

  169. I always thought 35% to 50% down payment was required by banks for foreign. RBC had a 35% program that I know a lot of foreign buyers used and that is the lowest downpayment I ever heard of.

    The 10% down student just doesn’t add up. How did CMHC approve her application? (credit score, debt service guidelines, etc.)

    Makes no sense. She must not be a student (has a work permit) and has a job.

  170. Good questions about the university student – I see she just finished university, but don’t you have to have verified income to pay the mortgage, and what would those monthly payments be?

    Paying a $500k mortgage fresh out of school? “Cobbling together” a downpayment? Sorry I’ve seen too many of these fake sob stories to buy it. That’s supposed to be the “lead plaintiff”? Gimme a break.

    Ultimately it’s the bank’s fault for giving her the mortgage in the first place. Maybe taxpayers should launch a lawsuit against the banks.

  171. “she cobbled together a 10 per cent deposit on a $560,000 townhouse in Langley by borrowing from her parents and friends in China.”

    Are you allowed to borrow a down payment? I thought the point was that it was not borrowed.”

    LeoS,

    I thought you had to have minimum 35% down and in some cases 50% down to get a mortgage plus a years gauranteed payments in the bank ? Are they bending rules for foreign students just to get the sales commission ?

  172. You can give it to AG so he can give to a guy who takes 3% no matter what, then when you hopefully make your 2% you have lost 1%. If you lose 5% then you’re down 8%.

  173. “she cobbled together a 10 per cent deposit on a $560,000 townhouse in Langley by borrowing from her parents and friends in China.”

    Are you allowed to borrow a down payment? I thought the point was that it was not borrowed.

  174. Definitely seems like the risks to the global economy is heating up…. So the question is, what to do with extra cash? Hang on to it, invest it in the markets, or pay down the mortgage?

  175. I swore they told us over and over that we had the most conservative banks in the world.

    Canada flagged for worrying levels of credit and the threat it poses to country’s banks

    “The Bank for International Settlements, a global banking body, is warning that Canada has one of the highest credit-to-GDP ratios in the developed world and that the “unusually” elevated level poses a risk to the country’s banking system.”

    http://business.financialpost.com/investing/canada-flagged-for-worrying-levels-of-credit-and-the-threat-it-poses-to-countrys-banks?__lsa=ce5c-97ee

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