Book Review: Our Crumbling Foundation
A while back Gregor Craigie (local CBC radio host and author) reached out to discuss my take on some of the root causes of the housing crisis. We’d discussed some aspects before on his show but we had a somewhat longer conversation about some of the structural barriers I see that work against housing in Canada. Gregor said he was researching for a book, and that book – Our Crumbling Foundation: How we solve Canada’s housing crisis – was released on March 5th.
I secured an advance copy to write a review, though that didn’t quite get done before the release date. My review follows.
The book starts with a dedication that immediately spoke to me.
This book is dedicated to everyone whose life is on hold because they can’t find a home of their own.
That simple dedication captures the human cost of the housing crisis that can get easily lost behind endless headlines about spiraling costs. Housing security is a pre-requisite for nearly everything else, and countless lives are on hold in Canada due to our unaffordability crisis.
Though the book’s title promises solutions for Canada’s housing crisis, it doesn’t start out in a prescriptive way and I see that as a key strength. There are many strong opinions about what should be done about the housing crisis and I’m honestly tired of reading missive after missive on what exactly needs to happen. Craigie avoids diving right into solutions in favour of telling stories about people affected by the housing crisis, and it makes the book a much more engaging read especially for normal people that aren’t knee-deep in this issue already.
Those stories span the globe, and in fact in the first dozen chapters there isn’t even a lot of focus on Canada. In fact stories of people suffering from the housing shortage in Canada are alternated with stories of approaches in other countries that are yielding results or showing promise. That’s probably fitting given we have such a disastrous track record on housing we should probably be looking primarily at other countries that have handled it better than us. Examples range from workforce housing in London, to short term rental controls in California, to housing first to prevent homelessness in Finland, and Japan’s simplified top down zoning system that has contributed to relative housing abundance.
I particularly enjoyed the chapter on public housing in Singapore. While Singapore is often held up as a successful example of a largely decommodified housing system, I suspect few are aware of the details of how that is implemented. Through the story of a Singaporean couple moving into their first home, Craigie explains the financing and history behind the housing model where 80% of residents live in public housing. As a downpayment for their publicly built leasehold, the couple used proceeds from a compulsory savings scheme that requires all Singaporeans to contribute 20% of their salary with additional contributions from their employers; effectively amounting to a more flexible version of CPP. Ownership also comes with heavy restrictions on resale, and the carefully planned system even includes limits on how many members of each ethnic group can live in a given neighbourhood. Craigie mentions the quotas were intended to improve ethnic mixing, but can also result in “people being prohibited from buying homes in an area based on their ethnicity”. It’s difficult to argue that it hasn’t been a success for Singaporeans, but Canadians are likely to balk at the level of control.
On the housing supply side, it was fascinating to read more about the experience of both Japan and France, who have arguably both had success in promoting housing supply with very different approaches. Japan drastically simplified restrictions on housing and managed to keep housing relatively affordable even in growing cities like Tokyo by allowing the market to efficiently respond to a broad spectrum of housing needs with minimal planning obstacles. Meanwhile Paris rapidly scaled up affordable housing production with state level mandates at the municipal level, and a focus on infill housing. Interesting but less convincing is the example of Berlin’s housing co-ops, which seem to lack the scale necessary to meet housing needs (and Berlin has been struggling with bad housing ideas lately).
There’s a few minor errors in this book, though they’re generally regarding tertiary details that aren’t important to the meat of the story. Craigie states Canadian population growth at over 1% is a record high (far from it), the Vancouver Special as being invented in 1940s (actual: 1960s), and replaces arbitrage with arbitrary several times. He also describes me as a professional engineer (I am not), but these are minor quibbles easily overlooked.
What I missed a little more was a more thorough set of references. For example, in a chapter on the Quebec housing shortage Craigie states that most leases in Quebec still respect the tradition of the “moving day“. I’ve long noticed that the Quebec rental market doesn’t seem to behave like markets in the other provinces, most notably around the relationship between rental vacancy rate and rents. I would have loved to read more about the tradition or where the claim came from that most leases still abide by it, but a brief CBC story was the only given reference. However this is perhaps not a real fault of the book since of course it can’t include everything.
Craigie wraps up the book with an afterword that details some of the promising moves that have been made in Canada in recent years. Those range from the hugely ambitious First Nations led projects in Vancouver (Senakw and Jericho), abolishing of parking minimums in multiple cities, experiments with Housing First approaches and modular construction, and provincial zoning reforms in BC. Those recent moves give reason for hope, even if the task of fixing decades of deteriorating affordability is going to be monumental one.
Curiously enough, the collection of specific recommendations to address the housing crisis are found in an appendix at the end of the book, even after the afterword. They feel almost like an afterthought, and I think would have been more impactful directly after the stories. However in general I agree with the large majority of them, and in fact with the breakneck pace of housing reforms announced recently at all levels of government, many are being implemented as we speak.
Our Crumbling Foundation is first a collection of housing stories, and I think it’s important because it’s easy to forget that housing shortages play out in million different human ways especially if readers are themselves comfortably housed. Though I’m familiar with the factors and approaches he discusses, I still greatly enjoyed reading this book and can strongly recommend it. The book benefits from Craigie taking on a journalistic point of view, telling the stories without trying to impose a particular ideology onto them. Even if you don’t agree with the conclusions drawn, I believe it’s well worth your time to read.
Also the weekly numbers
| March 2024 |
Mar
2023
|
||||
|---|---|---|---|---|---|
| Wk 1 | Wk 2 | Wk 3 | Wk 4 | ||
| Sales | 44 | 162 | 590 | ||
| New Listings | 114 | 427 | 1118 | ||
| Active Listings | 2354 | 2470 | 1970 | ||
| Sales to New Listings | 39% | 38% | 53% | ||
| Sales YoY Change | — | +8% | -29% | ||
| New Lists YoY Change | — | +26% | -8% | ||
| Inventory YoY Change | +27% | 31% | +85% | ||
| Months of Inventory | |||||
March is starting out how February ended, with pretty similar sales numbers to a year ago while new listings outpace the year ago level by a healthier margin. As I’ve pointed out before though, that comparison is to a weak month for new listings a year ago, and the increase mostly just brings us back to normal levels.
Flat sales and an improvement in new listings means the overall market is somewhat weaker than a year ago, though it can’t be described as weak. Don’t forget, we are still in sellers market territory overall and likely to stay there for the next few months.
With no rate relief from the central bank and the bond market keeping fixed rates around the same level as they were a year ago, don’t expect a lot of movement in the market this spring. These market conditions are enough to nudge up prices as often happens in the spring, but it shouldn’t be by a lot, with additional inventory mostly keeping the market in a holding pattern.
The level of new listings is one of the more mysterious aspects of the market, moving up and down with seemingly little relation to any other market conditions. That could happen again and reverse the current weakness as has happened several times since the pandemic. However with mortgage delinquencies trending up (albeit from extremely low levels to merely low levels) and mortgage renewal stress hitting the peak this year and potentially next, I have a hard time believing we will have a lasting new listings drought in the near future.
Expect those delinquencies to keep climbing and a lot of breathless headlines about skyrocketing mortgage arrears. Personally I won’t be concerned about it until we’re back to where we were 10 years ago and still climbing. That’s some three times the current rate, and would still be at a historically low level. Overall I don’t see foreclosures becoming a significant factor in the market, but I do expect those headwinds to keep inventory on the upward trend in the medium term.
Suddenly cancelling the listing and taking the house off the market in response to a competitive offer is different than continuing to market the place and waiting for a better offer
New post: https://househuntvictoria.ca/2024/03/18/the-rates-tailwind/
Well yeah, shit gets real. We were going to sell back In 2012. Had a decent offer, then started thinking…What are we doing. We refused everything they wanted and they walked. We cancelled the listing Immediately. Way too much Garth Turner, we don’t read him anymore. The house has more than doubled In value since then.
Functionally that’s not different from being unwilling to accept any of the offers on hand. Objectively you either sell or you don’t.
Leo what’s the current forecast on max inventory for the year? Looks like 3,100 will be surpassed without issue.
Should go well with the fixed lending rates getting a bump either this Wednesday or next in response bonds.
Sellers last minute deciding not to sell seems reasonably common in my limited experience. Happened twice during our last home search. Never know the whole story as that is filtered through the seller’s agent and then the buyer agent. But in both cases we were told that the seller had changed their mind. Both times we had pretty decent offers on houses that had been on the market for a while.
I agree with Peter, there is a bit of emotional investment by the time you have found a house you are willing to put a strong offer on. Probably not if you are buying an investment, but definitely if you are buying a home for your family.
LMAO, so by your account only the realtors on both sides are the ones that are actually SOL for doing work for no pay.
Marko said the buyers have “nothing”, which is what I was referring to as dramatic.
Rarely do potential buyers have “nothing”. They have the down-payment (or “deposit” in kiwi-ese), or an existing property.
Marko’s account made it sound like the potential buyers are now out on the street, without a penny to their name, never to have a house. If only this tragedy could have been averted by them making an offer closer to what the sellers were hoping for.
Who knows how “devastated” the buyers are. But my guess is: “tire-kicker” sellers tried to seize this moment to make a motza from their house; “tire-kicker” buyers saw a house that had been sitting on the market for a while and made a low-ball offer; after a bit of to-and-fro, it became clear to the sellers that they weren’t going to get the sum they were hoping for, so they pulled the listing; everyone walked away after a fun day of tire-kicking.
“Insider Contacts” right again 🙂
https://househuntvictoria.ca/2024/01/29/how-often-do-owners-move/#comment-111086
Month to date market activity:
Sales: 299 (up 5% compared to same day last year)
New lists: 784 (up 35%)
Inventory: 2588 (up 35%)
Really piling on these days.
The house could also burn down and long list of other things that could frustrate the contract, but for all intents purposes once the seller signs it’s a done deal in my opinion. I’ve never had a seller actually pull out in 1,000+ transactions. Two wanted to, but didn’t.
This is true and why agents will not be replaced anytime soon, in my opinion. I think a lot of private sales would struggle today for many reasons in addition including increased regulation, polarization in society, entitlement, etc. Some would thrive for sure with the middleperson (agents) removed, but that would be the minority. Maybe it is just me but I feel like working with people are become more complicated since I started 14 years ago.
+1, often I think I am completely out to lunch on HHV, but nice to hear someone actually explaining real life for once 🙂 I think most readers are probably confused as to why my conversation with the buyer’s agent was very awkward for myself. Most people are thinking what is the big deal seller decided not to sell….completely ignoring the reality of your 7 points re buyer perspective.
So, the thing about the buyer losing out because the sellers changed their minds and pulled the listing, but who cares because they can just pick one of the other 2000 houses…
Does anyone really do life that way? Then hats off to you, you are a logical and dispassionate person.
Maybe I’m just weird, but some version of this is how our house purchases have generally gone:
Drive-by narrows the list to 5. Call agent to see them. 1 or 2 have sold, 1 or 2 are no good, if we’re lucky there’s a choice between one or two that could be good.
Go see those 2 again. Debate pros and cons endlessly. In the meantime, one sells, but hey, 2 more new listings, go see those. Debate them. Maybe rinse & repeat. Maybe you & spouse not quite on the same page! Maybe the one you really want just a bit beyond your comfort range & you just “need it to drop to a more realistic level” (but that one sells)! Stall. Yes, difficult client! Arghh, now what?
And here’s a stunner: once you’re looking in a certain (upper) price bracket, guess what, it’s even HARDER to find the unicorn that actually motivates you. Could come up maybe once or twice in months of watching.
Lose all hope.
Finally, surprise, the right one comes along, everyone’s on the same page & it’s time to go ahead with the offer! And here’s what happens now, this is the interesting part, now that we’ve reached that tipping point, we LOVE that house and secretly have to have it! We’re mentally placing the furniture and hanging paintings.
Then say half the time we’ve reached this point, deal falls apart for whatever reason & it’s devastating.
Sure, we pick up the pieces & buy something else eventually, and it all works out fine. But every time we make the offer, it’s because we’ve reached that tipping point of wanting that house – badly – and if it doesn’t work, it’s terrible! It’s just not, oh, just move down to #2 or #3 on the list and move on. It’s a process, and for us it takes time. It’s a home, not one X sq. Ft. Box vs. Another X sq. Ft. Box.
Anyways – maybe the reality of the market have changed since the last time we did this. So I guess we better not do this again for a very long time!
Not exactly.
If a seller backs out of a signed contract a court will not usually order specific performance ie. they have to complete the sale anyway. A court will, however, generally grant damages and costs to the buyer. If the buyer has any losses or had to pay more for a similar home the seller will be ordered to pay these costs – along with general court costs. In addition, if the seller had a real estate agent, he or she would likely be entitled to the commission in this case as well.
These costs, plus the stress of dealing with litigation, make it generally inadvisable and unwise – and super expensive – to back out of a deal. However, seller’s remorse is a real thing. It is hard to let go a of a home in many cases because of the emotional attachment.
https://www.timescolonist.com/local-news/victoria-signals-to-province-invoice-is-in-the-mail-8455515
Apparently, the city of Victoria is going to expand it’s role into new areas without funding or a mandate to do so. I guess they solved that housing issue with the missing middle slate of candidates and now they can get back to building Victoria as a draw for the rest Canada to export it’s junkies to by building out the already well established junkie farming support industries. A quick missing middle feign to draw votes (designed and implemented to fail), doing nothing, and then jump right back on an activist agenda. Does anyone want to start making guesses how much staff will be hired and costs that will come along with it?
There can be quite a difference between units and houses. Like you I had a Samsung in a previous house and also found it to be slow to heat up, and vents were loud. Different (older) house now with a Mitsubishi, heats up quick and is dead quiet (much less airflow).
If you go back on HHV 16 years to present I’ve always pushed for a release of sales data. I’ve explained why as well, it would save me time from emailing people and I am all about efficiency.
That being said I don’t think open sales data and commissions are correlated. I am reading through hundreds of comments online and based on the comments damn it looks like a lot of places in the US area actually around 6% commission! Wow.
It sucks having to email an agent, I agree, to set you up on the live feed for the data, but pretty much any agent will. Leo was setting people up when he was licensed.
Another complete mis-read of my comment. What I was getting as is I’ve never seen a situation where 5 to 10% waiver is employed as it doesn’t make sense (the numbers are super small), but yes many times in my career I’ve waived 50% +/- if it made sense…..see how I ended my comment below “It is a business decision and sometimes 50% is better than 0%.” aka I’ll waive 50% as waiving 50% is still better than making $0.
What I am trying to say 5% to 10% makes no sense as things don’t stall out on numbers so small, 50% does. I am not saying that waiving the commission doesn’t make sense or I’ve never seen that in my career. I am saying I’ve never seen the 5 to 10% component.
Really? that’s interesting, sellers are much more willing to work with the agent on pricing once they see the agent is making an effort cutting his own commission. Maybe try that out next time if there is a 10k difference, offer to take a 2500 cut on commission and have the seller take a 2500 cut on price and see if the buyer will move up the other $5k.
Might be true, but I don’t buy it as the realtor industry, or which you are a part, have jealously protected the status quo and actively fought tooth and nail against releasing sales data.
So, sorry if I won’t take you word for it.
Your insider story is nothing I’ve ever come across in my career? 5% of a commission on a million-dollar house is $825? 10% is $1,650, let alone for a condo. Deals don’t stall out on such small gaps and if you have a $10k gap you aren’t going to the seller saying hey I’ll take $825 off if you come down $9,175. To get a stalled-out deal across using a reduction in real estate fees typically requires waiving 50% +/-, if that is something the agent wishes to try as a last attempt maneuver. I would be embarrased going to the seller with a 5% waiver proposal to try and bridge a gap.
There are many situations where it makes to waive 50% +/-…..house on market 6 months for example and you know seller will use you to buy a $2 million dollar home subsequently. Other times it doesn’t make as much sense. It is a business decision and sometimes 50% is better than 0%.
Deposit isn’t paid by the buyer until conditions are removed so that has zero context to my story? As for a couple thousand houses to choose from….strange that people get into over ask multiple offer situations when they can just opt for one of 1,999 other properties and not get into a multipe offer bidding war.
That is kind of my point, I don’t think you really comprehend what I am trying to say in relation to the discussion. A real estate transaction is very rarely straight forward, it can be quite complex with a lot of time wasting. It’s not quite what people make it out to be just put the house up on MLS, everything is online, and hire a lawyer to review the offer and that is that.
If it was that simple mere postings would be at 20-30% market share by now.
That depends on how much commission you had to waive. My “Insider Contact” tells me that depending on the market conditions, interest on the property and his gauge of both the buyer and the seller’s willingness to negotiate, he would routinely waive 5 to 10% commission just to get the deal across the line.
So dramatic. They still have their deposit. And a couple thousand houses to choose from.
Sounds like you and the sellers wasted the buyers’ time more than they did yours.
According to people who’ve analyzed the proposed NAR agreement…
There appears to be a big loophole in this, because under the proposed NAR agreement the buyer’s commission fees can still be freely listed on other sites than the MLS. While the MLS won’t list what the buyer commission is, the listing agent’s website can show the buyers commission. So if a prospective buyer tells his agent about a house he’s found on the MLS, his agent can just browse to the seller agents page to see what the buyer commission would be.
If that’s correct, that negates your point that the “ biggest change [in USA] will be that buyer agent commission will no longer be visible on MLS”, because so what if the agent just needs to browse to the seller’s page (which is usually direct linked anyway). That would take about 30 seconds.
The agreement needs to be ratified by the DOJ, which has been listening to consumer groups. I’d be surprised if consumers groups agree with this settlement where the buyers commissions can still be posted on the internet, just not on the mls page.
That’s the thing you can’t get out…You have signed a legal and binding contract. That’s when It sinks In. You have raised your family In this house for however many years. You get cold feet. So anything the buyer wants you just say no, and hopefully they go away…Then you can cancel the listing.
To make for a level playing field, there should be a rescission period for sellers as well. I made a mistake I don’t wish to move forward.
Thing is there is no way out. I’ve had this happen twice in my career where the sellers called me after acceptance that they didn’t want to sell anymore and both times they discussed with real estate lawyers and then got back to me that they would complete as per contract even thought they didn’t want to sell. Both parties ended up buying subsequent properties with me so they weren’t upset with anything on my end (reasons were not sale price concern related) but changed their mind and the lawyers advised them there was nothing that could be done. (of course we asked buyers out and buyers said no).
So in the above scenario if the buyers accept the offer it is a done deal (assume buyers follow through and remove conditions). Whether the sellers want out or not is kind of irrelevant at that point.
Once again, applying logical theoretical concepts to real life. This is how it unfolded
Do you have appetite to come back at your last counter? “No”
How about we go back higher than your last counter to give the buyer one last chance? “No”
The sellers were unwilling to sell the home for a higher amount than what they signed off and offered to the buyers hours earlier. If I offered to waive my entire commission the outcome would have not changed.
It appears not to make sense but interesting situations like this happen every day, as I said it didn’t make my top 5 yesterday. I can’t discuss the other ones as they are still ongoing/more sensitive and this one is now in the past as listing cancellation signed, etc.
It doesn’t bother me whatsoever as I know the sellers and they are really nice people, I have the photos and everything in my cloud and I am 98% sure they will call me in 2 or 3 years to re-list the property and I’ll sell it one day, but communicating this to the other agent was certainly uncomfortable.
I am huge fan of Tesla’s online ordering but there are just so few moving parts as there are only a handful of factors at play in terms of model/colour and very limited options. I think it is going to be difficult to apply Tesla’s advancement in the way cars are sold to something like real estate transactions.
Not to mention Tesla has unlimited inventory and is a sophisticated seller with no emotions versus real estate is two emotional private parties.
Exactly…That was their way out.
I don’t know maybe if they didn’t counter and the offer was accepted then likely your sellers would have wanted to try and get out of it anyways? Sounds like they had been on the fence for awhile.
Don’t know how much the property was but if its a decent price and if you could have went back in time then you would have bridged the couple K with part of your commission and got the deal through.
Realtors: I have a fiduciary responsibility to act in your best interest.
Also realtors: I think you should bid a million over ask to get this house. It’s in your best interest.
Nothing substantial would change and nothing will change (especially in Victoria as unlike Toronto/US we aren’t at 5 to 6% gross commissions). A lot of the ideas pertaining to the real estate industry make a ton of sense in theory and I fell for that trap early in my career, for example, mere postings. I predicted in 2010 when the competition bureau made their judgement that by 2015 mere postings would have 15% market share. Why wouldn’t sellers want to save 10k or 20k on the sale of their property? Mere postings have been a complete flop, at least in Victoria, in terms of market share. Zero demand.
Yesterday I had a super busy day and the below scenario didn’t even make the top five interesting/awkward/required client counselling or problem solving situations just in the one day.
Yesterday morning I received an offer on a property I’ve had listed for a while. We’ve only had two showings, but we received a solid offer. We start negotiating it through the course of the day via DocuSign and at one point the buyers counter my seller’s counter to within a few thousand dollars. I send it over to my seller with my thoughts and the seller gets back to me and says hey Marko, this may come as a bit of a surprise but we had a chance to discuss this a bit more and we’ve decided to not to sell the property. We won’t accept or counter, please send the listing cancellation and will be in touch with you in a few years. On my end, no problem whatsoever, but it meant having to get in touch with the buyer’s agent at 9 pm on a Saturday. If the buyer had not made that one last counter and just accepted they would have had the property, now they have nothing, just a tad awkward to inform buyer’s agent.
and that wasn’t in the top 5. I don’t think people have a good idea of how real life real estate actually works.
When people say listing agent should have to show the property to people inquiring directly are completely ignoring real life….I literally had a person phone me yesterday as she walked by my sign wanting me to show my listing yesterday because it was her “only day off.” When I started my vetting over the phone it turned out she didn’t know what the list price of the home was…..lol. This wasn’t even in the top 10 of what happened yesterday.
The government banned dual agency…..the government thinks it should take two brokers. Remember, banning dual agency is not something the real estate industry wanted whatsoever, but as a result of consumer complaints.
Unless there is a common sense reason for me to be present I pass on listings where seller wants me to be present. In my opinion less than 5% of properties warrant listing agent being present. An example of that would be an acreage with barns/outbuildings/well, etc., where it might be beneficial to be on site to explain lots boundaries and things like that. Another example would be a difficult tenant situation, etc. Another example would be 20 showings booked for one day and you need to manage overlapping showings, etc. Very unique house requiring explaination, etc.
Beyond that less than 5% it is such a complete waste of time. There are agents that sell the “I’ll be present, no lockbox” in their listing presentation and then when I show up with my buyers the first question the buyer has is “why does the listing agent have to be present?” The listing agents knows this so the vast majority of time we meet them in the driveway and they say “go ahead, I’ve opened the front door, I’ll give you guys space let me know if you have any questions,” and then they sit in their car. Sure, we can ask them questions when leaving but I have a direct cellphone to every agent as well. Even better frequently it’s not the listing agent present that took the listing but someone from their office that knows nothing about the house.
Yesterday I had 8 showings and with traffic it is super difficult to arrive on time that is why I book them for 1 hr time slots overlapping. For example, I had one showing booked yesterday 1:30 pm to 2:30 pm and because we stayed longer at the house before plus worse than usual traffic we didn’t get to it until 2:10 pm. If it was listing agents present I would have had to be on the phone non-stop to adjust the schedule, or they are waiting for me for 40 minutes on a Saturday.
Currently I have 15 listings. With the exception of one I either helped the seller buy the property (most common), repeat client (I’ve done other transactions with them), or referral.
For example, I helped my clients purchase this property in 2015 – https://www.realtor.ca/real-estate/26586642/781-cecil-blogg-dr-colwood-sun-ridge
Or I helped my client purchase this property in 2018 – https://www.realtor.ca/real-estate/26473439/4113-alberg-lane-saanich-mt-doug
My client paid $1,805,000 back in 2018. Whether he paid $1.6 or $2.0 million in 2018 is irrelevant from a commission standpoint as every single scenario is a huge pay cheque.
In the real world what is far more important is that my client is happy with the services provided on the purchase so he or she calls me to sell the property in 6, 9, 15, or 25 years later and part of the client being happy is negotiating the best possible price (lower commission), re-negotiating after inspection when it makes senses(also lowers my commission), etc.
If you put ethics/morals/etc., aside, even from a purely business standpoint it makes sense to obtain the best possible price for your buyer. You many sacrifice a few hundred dollars on the purchase but you make it up in 10s of thousands via re-sale of the property, referrals from that client, etc. It’s a very easy business calculation, imo, to represent the best interest including the best possible price for your buyer.
Do you want to think that over? The more the buyer offers, the more likely they get the sale, right?
Because any sale puts a big fat cheque in the realtor’s pocket?
Absolutely we need a judgment like that here.
The current status quo, where we have an essentially fixed, percentage based fee, that applies to both buyer and seller where neither party involved in the transaction can functionally opt out is basically an added tax on home sales designed to line the pockets of the real estate industry.
Add to this a ruling that all MLS listings and sales data must be publicly posted and viewable nationwide.
Or professional appraisers.
I’m not as negative on buyer’s agents. I have known hundreds of buyers agents and most are fairly incorruptible. My opinion is that what is happening in the excited states of America is not going to be a positive for home owners. Having said this, I would expect someone else to step in and fill the void, and to provide a service, for a set fee, to assist buyers in their purchase, similar to what Chartered Surveyors do in parts of the Commonwealth countries that do not have buyer’s agents.
…Is In It for the money. The agent Is probably sick and tired of driving these buyers all over town looking at one affordable shanty after the other.
When markets are hot, realtors have to work 3 times as hard to make a sale. When they have a “live one” on the line they have little motivation to recommend they put in a “reasonable “ offer that will probably be outbid. Your neighbors have only themselves to blame. Real estate appreciation is not a guarantee, it’s best not to buy when markets are hot. They better check prices up Island first, Covid prices were even crazier.
Buyer’s agent has no clue what the market will do and what the market price is when things are super hot. That is how things get super hot, what is market price today is not market price next week so you have to pay the premium today just like the stock market. Their issue is that they bought something they couldn’t’ afford, had they passed the stress test properly and maintained their financial position their renewal cashflows would be pretty similar to what they originally got stress tested at. This is 100% buyer issue, no realtor would have saved them.
Yes, but in the real word buyer’s agents are paid a % of the selling price, so what incentive do they have to get the buyer to reduce their offer?
My neighbors bought their house during Covid. They were out of town buyers and wanted to live in Victoria and ended up paying over market value. Now with the interest rate increase, they fear that they won’t be able to make the monthly mortgage payment when the mortgage renews in six months. After speaking with several realtors they expect to take a 15 percent loss when they have to sell. Their intention now is to leave Victoria and move up island where the prices are lower.
I would think that if they had had a “good” buyer’s agent, they would have been informed that the home was over priced before they purchased it.
And that’s what I think will happen without a buyer’s agent. More people will end up over paying for real estate. As the system is set up for buyers to over pay as they won’t have anyone looking after their interest. This is especially true for first time buyers and out of town buyers who need someone, with experience and the education, to guide them in an unfamiliar market place.
You can do that now in a round about way. Email the listing agent to view the house, if you like it then work out a cash back commission structure with a buyer’s agent for the offer, agree on one offer and up to x counters for $xx amount.
Man , true that
https://househuntvictoria.ca/2024/03/11/book-review-our-crumbling-foundation/#comment-112815
Similar to COVID, you are right fear is a powerful thing. But also similar to COVID, reality is not what you’re afraid of.
Barrister , I agree it shouldn’t take 2 brokers to sell a house , but buyers do want someone to hold they’re hand , fear is a powerful thing
Maybe just ban buyers commissions. Arrange to see houses yourself and if you find one just hire the agent to draw up the offer. Everything is online these days. Would mean the listing agent would actually have to do work to earn their commission by showing the house instead of just having a lock box.
It’s a potential huge shake up in the US. Lots of agents on r/Realtors are freaking out right now. If nothing else NAR fees will go up to pay for the settlement.
The biggest change will be that buyer agent commission will no longer be visible on MLS. This will could result in requirements for an upfront agreement with the buyer on commission, which many agents already do. It won’t be able to be part of the purchase price and baked into the financing since it doesn’t come from the seller, so I can see lots of buyers negotiating this down. That’s going to be a big expense for first time buyers. Agents who can’t justify value or do this part time might be culled.
Canada is a bit different. We have much better disclosures ( and lower fees, who’s paying 6%!) in BC and throughout Canada so we’ll see if we follow suit here.
Seems like “Armageddon” has arrived for RE agents in USA .. “ a mass exodus of brokers from the industry — potentially half of the 2 million or so agents in America”
NAR has settled and agreed to big changes in USA for RE agents. Now buyer’s agents commissions will not be allowed to be disclosed on listings, and so many sellers may be paying $0 buyer’s commission. So now you see a house for $800k and want to see it, and the buyer’s agent won’t know if his commission is $0 or something more than that. So the savvy buyers agent needs to have an agreement for the buyer to pay him or risk working for free. Seems simple for the seller to decide to offer $0 buyer’s commission, expecting that it’s up to the buyer to pay his agent.
https://www.cnn.com/2024/03/15/economy/nar-realtor-commissions-settlement/index.html
“prohibits agents’ compensation from being included on listings placed on local centralized listing portals known as multiple listing services”
“real estate commissions are expected to fall 25% to 50%”
“Miller said the settlement could lead to a mass exodus of brokers from the industry — potentially half of the 2 million or so agents in America”
Ideally yes, but such is life ;).
I’ll most likely be jumping on the MURB bandwagon.
There’s lots to review. If you don’t have an agent, you should review with a lawyer. Even if it’s all boiler plate the agent or lawyer can clarify and answer questions.
Marko specifically said there were 20 pages of conditions on the offer for his mere posting seller, so I really don’t know what the issue is then. There are only three choices the seller has: review himself, get a lawyer to review or don’t do a mere posting and have a realtor advise.
And what would the lawyer even review? Granted when we bought unrepresented we had our lawyer review our offer before we sent it but just because I wanted a second set of eyes, having never sent an offer before. The vast majority of regular CPSs are so standard there’s not much there. With the standard forms and clauses there’s only like 5 things to understand. This feels like something that technology could handle 90% of the cases without a lawyer.
With good exposure it’s basically an economic no-brainer now.
Re. flat fee listings, we’ve successfully used:
https://www.forsalebyowner.ca/fsbo-mls-pricing
It is $549 and they provide all the documents you need. Have a lawyer review prior to accepting an offer.
Not for everyone but works for some.
While I agree in principal, in practice it simply doesn’t work like that.
I would say 90% to 95% of offers I receive are open for such a short period that there isn’t enough time for a lawyer review. Unfortunately, this behaviour on the part of buyer’s agents does not change with mere postings. No buyer’s agent is going to send an offer Friday afternoon left open until Tuesday so the seller has enough time seek out legal review.
Sure you could add a subject to seller’s lawyer review condition but that right away changes the mood of the buyer as they know if they offer on a non-mere posting 99% chance there is no subject to seller’s lawyer review.
Culturally here law firms that do real estate conveyancing just aren’t setup in such a manner that you phone them, immediately speak to a lawyer, send him or the PDF, and they get back to you. Reason being is it is so rare and then a lot of lawyer don’t know how to charge accordingly, etc.
Of the thousands of offers I’ve seen in my career, I’ve seen subject to lawyer review less than five times in my career unless something super complex like land assembly or buyer wants lawyer to review pre-sale disclosure statement.
Sounds like a house one would want to keep forever 😉
While not a solution for everyone, we added PV last year and will be near net-zero including 25K km per year. So we can certainly take the edge off of new demand, and ideally store excess renewables for use during winter (like pumping water back into dams).
Given climate change and future outlook for more frequent heat domes swayed us to go with heat pump with AC capacity.
Heat Pumps are not a scam but they are not perfect.
We switched from a 24 year old Natural Gas furnace this past June to a ducted Heat Pump (Samsung). Total cost with blown-in insulation into attic and mandatory energy audits was $21,195 (including taxes). We got $14,550 back in rebates. So our total cost was $6,645.
The Heat Pump is great in regards to BC Hydro costs. It’s cheaper than our Nat Gas furnace to run and now we have Air Conditioning for the 10 or so days a year when needed.
My main complaints with it are the noise from vents and the time that it runs. It is louder out of our existing ducting (apparently new homes with new ducting are quieter). But it also runs longer to heat up the house (70s box rectangle floorplan). For example the Nat Gas furnace would take about 20 mins to increase heat in the house by 1 degree. The heat pump takes an hour to heat an additional 1 degree. So if you love white noise you’ll love it. If like me you prefer quiet then no bueno. It is still cheaper than Nat Gas though so very energy efficient. Also the filters for it are stupid big (21 x 21 x 6 inches). So a 3 pack comes in a large box that you need to store somewhere and they are very wasteful as every 3-6 months they need to be replaced and chucked in the landfill.
We looked into just getting a new Nat Gas furnace and even with the now gone Fortis BC rebates it would have cost about $5,000 – $6,000 for a high efficiency model so we went with the Heat Pump and AC (the wife also reeeaaallllyyy wanted AC).
I am not sure how that prevents people from using mere posting? People should have a lawyer review the offers anyways, there is always a risk of relying on a realtor to review offers instead of a lawyer (not that lawyers catch everything every time), especially complex ones.
Why not increase to $1,500?
There is actually a super long list of things that have been introduced over the years that make selling privately more and more daunting. This is one of many examples where a lot of home owners might not be even aware. If you owner built your home 9 years ago and you go sell you probably aren’t thinking you might be selling illegally if you don’t have the notice to the buyer prior to them giving you an offer.
Owner-built homes may not be sold without providing the
Owner Builder Disclosure Notice to the prospective purchaser.
The Owner Builder Disclosure Notice must be provided to a
prospective purchaser prior to entering into a Purchase and
Sale Agreement.
BC Housing is advised by the Land Title Office whenever the
title of an owner-built home is transferred and enforcement
action is pursued if the sale is illegal (which may include
compliance orders, monetary penalties, court injunctions, or
convictions under the Act).
Rescission period, for example, and all the legislation just compounds on itself. For example, how does an unconditional offer rescission period + time clause (another offer being bumped) function? Government decided that rescission period was not to include weekends, time clause includes weekends, etc. I just dealt with such a scenario recently.
It’s has created for a situation where my mere posting clients are receiving PDF offers with 20+ pages whereas is use to be 8 pages.
Also, as of Jan 1st, 2024 I now have to collect notice of multiple offers on mere postings and I doubt my mere posting sellers will be putting together such a notice for all the buyers’ agents so I don’t even know how that is going to work to keep everything legit on my end. I increased the mere posting fee last week to $1,199 upfront (from $999) but I might simply be legislated out of offering mere postings in the first place.
In my opinion the government should exempt private sellers from things like the rescission period but such is not the case, applies to private sellers too. I was trying to explain the rescission period to an agent in Croatia the other day and he was like so let me get this straight, buyer willingly wants to write a unconditional offer, seller wants willingly to accept an unconditional offer, but the government stepped in to prevent such from being truly binding for three business days?
It is kind of like new home construction things just pile on every year.
A lot of agents complain about more and more forms….as I do too….but it’s pretty good job security.
Odd, my mom works in housekeeping at Uvic and complains non-stop about how they can’t find reliable workers. Pay is better than hotels.
Such as?
Yes I know, which is why I sad the lawsuits that “got” filed in Canada.
Separate note, spoke to the manager of a popular restaurant downtown that I frequent last night and he told me now he has too many applications for jobs. Complete 180 turn from 2022.
Similar lawsuit already filed in Canada. We don’t have any rules on commissions as far as I am aware other than the cooperating broker commission has to be $1 minimum. I guess they could change that from $1 to $0. Also article mentions commission rates of 5 to 6%…well in BC we are closer to 3%.
I listed a couple of mere postings this week and I see a problem in that the government has just piled on so much regulation that is becoming increasing more difficult and intimidating for a private seller not navigate the process of selling a home on their own.
BC Hydro has a call for proposals out – google it. We burn approximately 4 millions tons of biomass in slash piles every year. Diverting a proportion of that into power plants would generate a lot of electricity, improve air quality and reduce forest fire risk. Wind will be part of the answer. BC’s hydroelectric reservoirs are some of the world’s biggest “batteries” so they let us include intermittent sources like wind into our grid. Beyond that I expect small to medium hydro from private producers. BC Hydro doesn’t have anything big on the books for new hydroelectric, though not for lack of good sites. They could build “Site E” on the Peace. That might be the least damaging for the environment since the Peace is already triple dammed at this point.
Last year we imported over 20% net of our electricity almost all of it from coal or gas powered plants. Site C might, running at full capacity, be able to power about 900k cars (but only if they were all parked beside the damn). We are planning to convert 3 Million cars to electric over the next decade. Add into that heating for all new houses as electric and where do you think the power is going to come from. (before some idiot says wind and solar please do the numbers).
How many more damns are on the drawing board right now? I think the province deserves a more thoughtful and realistic approach to this problem. More input from engineers and less from politicians might be a good start.
https://www.nytimes.com/2024/03/15/realestate/national-association-realtors-commission-settlement.html
Interested to see what the ruling would be on the same lawsuits that got filed in Canada.
“With a ducted system the noise is almost non-existent indoors”
Indoors, yes, but ask your neighbors….. A number of lawsuits in the UK just now which turn on that very issue.
Hey Frank, respectfully think you might want to double check that rate. Parroting what Rodger has already stated with the credit line portion of the RBC hoeline plan being prime (currently 7.2%) + spread. Also have noticed RBC can change the available credit pretty willy-nilly….
I have four access panels to reach the Important areas of the attic (two on each end). Number one Is the dryer vent…It vents through the roof. Its a solid 4″ galvanized ducting that I completely remove and take It down to garage to clean thoroughly with a chimney sweep annually. It Is so Important to do this…I have seen dryers catch on fire. Number two Is my wood stove chimney flu, just to check It out from time to time. Numbers three and four are just there In case I need to crawl around and check shit out.
Max , good job getting the heat out of the attic helps a heep to keep the house cooler in the summer . I have done a fan on wall switch in the past
It’s the RBC Homeline plan, I got it years ago. It allows me to access any type of mortgage I want. The best rates, any combination of terms, etc…. I can access the balance whenever I want by going to the teller. One reason I don’t want to sell the property. It’s an investment property, the tenants pay the mortgage and then some. I also confirmed today that I can renegotiate the one year fixed term in 6 months without penalty. Technically a 6 month mortgage.
This was before the windows were cut out. My Wife didn’t want the kids falling out.
Attic Insulation Is key. I have a fink truss system and I actually finished the centre of my attic. R-28 on the webs, followed by 6 mil poly and 1/2″ drywall. I Installed 5/8 plywood on top of the bottom chords, followed by cheap laminate flooring. The rest of the attic has the existing 24″ of blown In Insulation.I then cut In two 3′ x 3′ windows on each gable, creating a 50′ wind tunnel. I even built a steep flight of stairs In one of the kids rooms to access the area…It was originally a fort for the kids. Now Its just a wind tunnel and It works great In the summer. Obviously I shut the windows In the winter.
Is this rate for HELOC or VRM?
Line of credits are Prime+. How did you get 1.89% for a HELOC?
Dad , same boat don’t really mind the few hot days we get . But in a pickle I can always add the ac unit to my gas furnace for not a bunch of money to give me the the cold air if I ever felt the need
Given climate change and more frequent heat domes we decided that heat pump AC will be one more important in the future
“ Girard said the [Quebec] government will soon start a “comprehensive review” of its spending with the aim of returning to a balanced budget on schedule.”
..unlike the BC government which announced plans for increased spending, runaway deficits and no plans to cutback spending…like the e-car rebate giveaway.
https://www.fraserinstitute.org/blogs/bc-government-projects-massive-debt-accumulation-and-british-columbians-will-pay-the-price#:~:text=After%20nearly%20two%20decades%20of,higher%20than%20in%202016%2F17.
“ According to the 2024 [BC] budget, high spending growth will continue and fuel deficits over the next three years, putting immense pressure on provincial finances. Planned budget deficits in 2024/25 ($7.9 billion) and 2025/26 ($7.8 billion) are now more than double the estimates provided in last year’s budget. The increases in the deficit come despite expected revenue increases of $1.8 billion in 2024/25 and $615 million in 2025/26 compared to the 2023 budget.
I feel like this would be a nice to have for the 3 or 4 days a year that it is uncomfortably hot, but the average daytime high is like 23 or 24 in Victoria during the hottest months, depending of course, on where you live.
I just leave the windows open from about June to late September. The fresh air is lovely.
I’ll say that since Fortis ditched the ridiculous rebates, it probably no longer makes sense to switch to gas. At some point in the future, I might even install a mini split heat pump when there are some decent DIY options on the market and then I’ll keep gas as backup heat and for hot water.
If you have existing ducting in your house, installing a heat pump is cheap with the grants (4k) w/10 year warranty for a brand new system. If you’re south facing the cooling is invaluable. With a ducted system the noise is almost non-existent indoors compared to a furnace. And with a little thoughtful placement you don’t hear the outdoor unit ether. Not a scam for our household. Get multiple quotes as always given the variation between vendors.
The number of downtown condominiums for sale has been consistent since the start of the year with around 160 condos for sale within a half mile radius of the downtown core. This represents 60 percent of all condos for sale in Victoria City proper.
Based on the last 90 days about 22 condos sell per month downtown at a median price of $543,500. The typical condo being a 2011 built unit of some 740 square which is about $735 per finished square foot. The average rent for a downtown condo, based on 84 units on Craigslist for lease, is $2,315 per month which would be around $3.15 per rentable floor area or a Gross Rent Multiplier close to 20. ie $543,500 divided by ($2,315 x 12 months) = GRM of 20 +/-.
20 is a good GRM. I’ve seen the GRM go as high as 24 in very hot markets and as low as 12 during a housing recession.
.
Renewed my RBC homeline line of credit mortgage last night. Went from 1.89% to a one year 6.49%. The advisor mentioned that I could probably renew it again in 6 months with no penalty. I went down in person twice to do this, each time I had a great conversation with very interesting people. We had a good discussion, giving each other our perspective on a host of topics. I highly recommend meeting in person. The open variable rate was 9%.
We had a heat pump installed last year and total cost after rebate was just over $5,000. This was a conversion from oil so was eligable for the full grant.
Average monthly electric bill for heat and AC has been about $65 (over 12 months, with house at 19 degrees during day and 18 at night) on a 1950’s, 2500 sq foot home.
Add in the benefit of not burning fossil fuels and its no brainer. Naural gas applainces are now found to have negative health effects. I find electric baseboards heat to be a very dry heat as well as a safety hazard for young children, inconvenient for furniture placement and just plain ugly and expensive.
One negative of heat pump versus natural gas and baseboards is it can take longer to raise the temperature during very cold periods (several weeks this winter).
A few years ago, Fortis gave you $2,000 to switch from oil heat to gas. So for $2,500 after rebates, you could get yourself a nice low maintenance, high efficiency gas furnace. For reference, annual heating cost with oil was about $2,200 to $2,800 per year, while gas is about $800 to $1,000 depending on market price and year-to-year seasonal variations, and of course, there is the ever increasing carbon tax.
That was a way better deal imo than a $15k heat pump, even with all the pandemic era rebates. Plus I don’t have to worry about the compressor blowing out, or random venting of refrigerant into the atmosphere in the middle of winter.
if you consider that you are buying an air conditioning system as well for the same price it makes lot more sense.
Heat pumps are a scam. Doubtful you recognize any real savings even with the grants. I looked into it, was still going to cost us $10k out of pocket after grants. That $10k is far better invested than spent on a mini split. I like the idea that if a baseboard breaks I can fix it myself and have done so. Good luck trying to get a tech to come fix your heat pump.
There’s a very interesting line of study that looks at the “time cost of money” and relates how much extra you would have to work at your job to make the money needed to pay someone else to do various life tasks. This calculation requires recognizing the added tax on work income that is not incurred when doing something yourself.
There’s lots of small, daily tasks and small size home renos that undoubtedly are better done by most people themselves rather than hiring it out. (This applies mostly for tasks that people don’t absolutely hate: as if you like your work more than say “doing home renos” then you might be incentivized to work more at your job to be able to pay someone else do those reno tasks that you hate.)
There’s also cases where it saves money to pay out to someone else. As an example, since the pandemic, my hourly income is high enough now that even though I don’t hate shopping for groceries I’ve found that grocery delivery is a great deal: it saves me more than an hour per week, eliminates driving to the big box stores and costs me perhaps $30 extra on a $200 order and for that I save 1.5 hours on the weekend of driving and shopping.
On the other hand when we moved last the moving company wanted to charge a sum in addition to trucks and equipment that was equivalent to $75/hour x 3 workers (Ie 225/hr for labour) for work that 2 people could do in the same time. On principle I couldn’t make myself pay that just to avoid a little bit of heavy lifting.
This discussion of the time cost of money is all somewhat separate from what sparked the original discussion which is why people don’t want to buy run down homes and extensively renovate these themselves.
That seems to be a separate case as many homes of this sort require extensive work, including gutting, electrical, improved foundations, walls, flooring upgrades, roofing etc.
Most people are not skilled in these tasks and unless they have a low hourly wage and lots of free time (which means they likely can’t afford to buy this home anyways), it’s unlikely that there are many people outside the skilled trades who can perform this work competitively. The economists of home building and construction are what they are for a reason.
Well if they were really cutting back on expenses they wouldn’t have a record deficit would they? Window dressing IMHO.
https://www.cbc.ca/news/canada/montreal/quebec-budget-2024-2025-1.7139641
But Quebec has the cheapest electricity in the country which is an incentive in itself:
Here is the average total cost of electricity by province, based on a monthly consumption of 1,000kWh:
Alberta 25.8¢/kWh
British Columbia 11.4¢/kWh
Manitoba 10.2¢/kWh
New Brunswick 13.9¢/kWh
Newfoundland & Labrador 14.8¢/kWh
Nova Scotia 18.3¢/kWh
Northwest Territories 41.0¢/kWh
Nunavut 35.4¢/kWh
Ontario 14.1¢/kWh
Prince Edward Island 18.4¢/kWh
Quebec 7.8¢/kWh
Saskatchewan 19.9¢/kWh
Yukon Territory 18.7¢/kWh
Canada Average 19.2¢/kWh
Here’s hoping… the beginning of the end for e-car rebates?
Impressive to see a government acknowledge that having a big deficit means they need to cut back on expenses. And so Quebec announces the the end for electric car rebates (at least by 2027). Of course here in BC we have $6 billion deficits per year and still seem to have plenty of money for giveaways for e-cars or subsidies for “middle income” homebuyers (incomes up to $180k/year) .
https://ca.finance.yahoo.com/news/canadas-top-electric-vehicle-market-to-sunset-rebates-over-next-few-years-172707724.html
“ Quebec’s subsidies of up to $7K will wind down and end in 2027”
Thurston, I wouldn’t say they were happy. Maybe less grumpy. In the days before rain screen protection, It was also less costly. Traditional stucco created an air pocket when it was hung to the wire mesh which allowed the moisture to dry out. Acrylic or synthetic stucco without rain screening was one of several causes of leaky condominiums.
Acrylic stucco back then was a proven product in dryer climates such as Arizona, it just didn’t work well in our wet climate.
The dealt difference drops once you get into 1990s 2”x6” homes with decent insulation. I’ve always liked the combo of baseboards and a gas fireplace and just crank the fireplace with the interior doors open.
Whatever , one of the big reasons acrylic stucco become so popular in the mid 80s was the weight . U have to be a muscleman to trowel on cement stucco , guys where happy to work with acrylic cause it was light and fast
Ya electric baseboards are cheap and easy but have to the most expensive heat u can have in a 2000 sq house .
People hate a on electric baseboards, but over and over again people don’t factor in maintenance.
I had South Island Mechanical come by (had to book two months in advance) my place to service my surface to air heatpump. $300 and that is with a large discount the building has with South Island. Unit is suppose to be serviced once a year.
My average hydro bill is between $40 and $45 or less than $300 a year in hydro. If I had baseboards maybe my bill would be $60 to $70, but I wouldn’t have to spend $300 a year on maintenance. Not to mention, how much is the heatpump going to cost to replace when it craps out?
Obviously on a house you save a bit more, but I’ve been to a lot of inspections over the years with failed compressors and all sorts of crap.
Seeing all sorts of other issues with these fancier more energey efficient systems. For example, in the old Dockside buildings there are no longer parts available for the air handling units, etc., I know people that have had to use space heaters. With a baseboard will pretty much never crap out, you don’t have to worry about expensive replacement costs if it does crap out, no maintenance, you aren’t reliant on a highly skilled tradespeople to help you if there is a problem, you won’t have issue with lack of parts, etc.
Obviously heatpump > electric baseboard but I don’t think it is a huge delta different when you factor in all the other factors, imo.
As I said the year 1980 is arbitrary.
Traditional stucco, is a mixture of cement and sand that is troweled onto a wire mesh on a home in a process called knuckling. In contrast, synthetic stucco is applied in layers. Foam insulation board is attached to the house’s plywood or gypsum sheathing with an adhesive. Then a cement-based base coat is spread on the board, and fiberglass mesh is embedded in it. Finally, a decorative finish coat is spread on top. This type of stucco has been around since the 1960’s but became popular in the 1980’s housing boom.
Silent floor trusses or engineered “I” joists allowed for larger floor spans as they have superior strength and are perfectly straight. The draw back to them is if there is a fire as this type of product fails quickly. I have spoken with the battalion fire chiefs for both Victoria and Langford about engineered joists and it is a safety concern for fireman as the floor may collapse during a fire.
A few of my friends that work at bigger local construction companies note there have been layoffs, but of employees that don’t show up to work multiple times per week. My friends that know their trade all have their full-time jobs + fully booked with side jobs as much as they want to work.
Also, if there are all these migrant workers here that don’t speak any English like various people on HHV noted wouldn’t those construction companies just let them go first so they don’t have to pay for their accommodation which in Victoria is ridiculously expensive?
As for quotes, I am seeing them come in daily on a 10 unit townhome project and not really seeing substantial movement since peak. Maybe 5% but that isn’t much given how much everything went up in the last few years.
80s and 90s houses seemed to be for the most part heated with electric baseboard . Perfectly fine back then but bloody expensive today
You just have to keep them at 15 psi. Its from the 1960’s, solid cast aluminum…The thing Is worth $600. They don’t make them like that anymore. Its good for canning anything…Jams, peach’s, pears, squirrels.
acrylic stucco would have been the 1990’s…Maybe late 1980’s (leaky condo problem). Same thing for poly B …Late 1980’s early 1990’s. Early 1980’s were all copper plumbing and copper wiring. You got me on the r-value. I heat my house with a woodstove so I don’t really care. I often open my door mid winter It gets so hot.
You missed this part…
Then….
Are saying OSB Is better? Sheathing, TJI joists?
LOL. If we have a sizable earthquake or hurricane, your Insurance policy Is going to be just as good as mine…worthless.
I too have a pressure canner for salmon and other low acid foods, but it is electric and can be programmed easily. Seems less likely to explode. Highly recommend.
The year 1980 is somewhat arbitrary, but ‘newer’ homes built since then have a lot more in common than ‘older’ homes because of changing trends, style, and construction materials. By the ’80s, builders had figured out how to build a mostly modern home. Houses built since 1980 generally have benefited from better construction techniques, energy efficiency standards, code requirements, and safety standards– by these measures, newer homes are superior to older homes.
The few things come to mind about 1980’s homes are acrylic stucco over wood framing known for hidden water damage issues and Polybutylene plumbing that is known to become brittle or damaged when exposed to chlorine (Municipal Water).
Generally, newer homes are more comfortable (energy efficient), safer, less prone to earthquake/wind damage, and need less expensive updating and repairs. Newer homes tend to be larger with open floor plans and larger storage and closet areas.
1980’s houses, the trusses were manufactured to span exterior wall to exterior wall. You can literally rip out every Interior wall on the upper level and have one great big room If you want. The lower level generally has one load bearing wall down the middle to pickup the upper level floor joists. They are constructed with Douglas fir Including the sheathing, copper plumbing, copper wiring, 200 amp panel, 8″ concrete wall on 16″ concrete footings. They are built like a brick shit house.
My Wife can make a loaf of bread for 35 cents. Its a machine that does everything for you except putting It In the oven. We also have an All American pressure caner for my wild caught salmon.
My point was that those are parts of life that many people choose to outsource. Neither condemning nor condoning.
Agreed. Probably why after many years as a thrifty student I still think breakfast cereal is a totally viable dinner when family is away.
All those things are called part of life…Especially walking your dog.
For sure. However that is not usually the only other thing competing for time given the average 20 plus hours a week spent online on entertainment.
Spending some of this time online learning to invest or getting an education could also have better ROI than real world home management stuff like cooking, gardening or fixing up your home.
But you become what you do. If your practice is to fix up things/cook be self-reliant than this continues long past the financial need to do so. If you develop the habit of eating out and spending your time on social media that becomes pretty comfortable and chances are you’ll continue. In both cases you’d probably be happy, but the first one will help you save and invest and get ahead if that is a goal.
As a bonus, my husband is in very good physical shape because he keeps busy doing physical tasks every day. Our family friend is 83 and he works on his house/yard every day and is in amazing shape. No gym needed.
What was I supposed to do? Sit there and rock the cradle? I had more productive things to do, I became obsessed with It. My Wife loved It In the end and It only took a year. I think Its called nesting.
My kids were young, one was an infant the other was three. Mom was there for them, Dad was busy going over every sq/Inch of the house and making It as new. It took me a year…2600 sq/ft.
I don’t disagree with you, and I totally respect self reliance. On the other hand as you have pointed out before, life is a time limited opportunity. I’m certainly capable of repainting my house exterior, and if money was tight I would. But given the choice I get better ROI spending my precious summer weekends doing fun things with my kids.
Knowledge, youth, full of piss and vinegar. Get home from work, have dinner and work until you crash…Weekends are the most productive. I’m glad I did It when I did, I don’t think I’d have It In me now.
The best thing about ownership is waiting for someone to come a fix a minor problem then charge a ridiculous fee for their precious time. Best to become more self reliant, some things are not that difficult. My Grandfather built our cottage in 1950 with simple hand tools (no electricity), people were far more capable in the past. Most people are pretty useless now thanks to technology.
DIY home repair or any home management task (like cooking) has had pretty incredible ROI given the cost to hire out many things and the fact that you are paying in after tax dollars for your primary residence. And you can listen to podcasts while you do these things.
The average Canadian spends more than 20 hours a week online for personal use for which they are not remunerated. A lot of it is on social media, streaming, and games.
And there is a very real cost of SFH ownership right there. If you enjoy home maintenance/home repair great. If you don’t then it is very expensive in terms of opportunity cost.
Absolutely there is a thriving DIY culture. However, I still think more and more people are paying people to do things that used to be considered pretty easy to do yourself: walking your dog, grooming your dog, fixing your bike, cooking most of your meals, simplish car fixes (fluids and brakes), cleaning your house, gardening/landscaping.
Partly a cultural shift and maybe just a symptom of affluence. If you have the money why not pay someone else to do any task that you don’t actually enjoy doing yourself.
We did/do. No question that sweat equity is not only a real thing that is quantifiable both in what it would otherwise cost to hire someone to do, but also when contractors are hard to find it is good to be able to get things done.
In terms of time for this, if you work full-time there are evenings and weekends. Not for everyone, but it is a real way to get ahead for those who don’t have extra money.
My husband still does lots of DIY. Doesn’t need to, but enjoys learning things and the reward of fixing/improving. We have lots of friends/relatives who do the same, so maybe it is a generational thing.
I think if you don’t have a good skill set or interest in DIY it is often better to just buy a newer house because finding and supervising contractors can be expensive and stressful. This probably means not living in the core areas of Victoria unless it is a new strata unit.
Abbey started from $1.425>$1.349>$1.258>$1.149>$1.249. If you look closer to the floor plan, you can tell the suite is illegal finished and the whole floor plan doesn’t make sense from an investment perspective. For buyers don’t need rental income, it’s a bit of work to convert the suite kitchen back to garage. The buildings value part of the assessment is definitely over assessed.
983 Abbey original list price was 1.425 last summer, all this information is available on HouseSigma
You either pay yourself to do it, or you pay someone else to do it. That’s pretty much it. There is also a third option of doing nothing, assuming the issues with the house are purely cosmetic.
I have done most of the work on my current house myself, and you need to have some basic skills, common sense, and at least some experience doing that type of work. There’s lots of good free advice and instruction on the internet on how to do things like tiling, drywalling, mudding and taping, etc. but there is still a learning curve and it takes a few tries before you get good at it. There is also lots of bad advice. And overkill, especially from the pros.
The time commitment can be significant. I’ve spent many evenings and weekends toiling away. It helps if you enjoy doing the work, but even if you do, it gets repetitive, can be mind-numbingly boring (e.g., tiling) and physically demanding.
You also need a bunch of tools, so there is a one time cost there.
Hard to say if its worth it in the end.
likely will have a condo built right behind.
Abbey looks like a nice place or for the same price you could buy 2620 Belmont.
Which one is the better value for the money?
I think they started at $1.35 and dropped all the way down to 1.15 and still no takers. Or maybe they were trying to get a bidding war at 1.15 and couldn’t get it. I was surprised given that it was suited.
Too late to edit my comment. I searched this website and Abbey was listed at 1.15 as mentioned in November 6, 14 and Jan 8th. Interesting that they relisted higher at 1.249
They must have been trying to sell that one for a while. The outdoor pictures are from July or August based on the flora. My japanese maple is just sticks at the moment, I would get no leaves on the bamboo until May, and my daisies don’t bloom until August. Did they drop the price on this relist?
That was me.
983 Abbey Rd is back on. I can’t remember who was chatting on that one a few months ago, but it’s back up.
So no one does weekend DIY projects anymore? Most people I know do small diy projects at home regardless of day job.
https://www.youtube.com/watch?v=HLU0UOt9RoA
Interesting video on housing that everyone might want to check out.
I don’t find the argument that people can save money by “fixing up their own house” through sweat equity to be convincing.
How exactly would the “do it yourself” approach defy the economics of house renovation?
Anyone who can afford to buy a place, even an old home that needs extensive renovations, must now have a good job bringing in a solid income. That person can’t work for free on their home without incurring a cost in lost wages or time.
Further, the vast majority of people don’t have the skills to renovate a home, and those who do can likely get paid a high wage in the labour market for those skills.
I can see some people who work in construction or the skilled trades doing this, but it’s not going to be a common practice.
Just to clarify for folks here , pads and rotors are disc brakes , unlike drum brakes
How often are people replacing their brakes. Of the 4 cars I had that were standard transmission I dont think I ever needed to replace the pads or rotors even after 6 or 7 years with average Victorian yearly mileage of about 10 -12K. Of all the other vehicles I have owned I can only remember replacing the brake pads on a Ford at about 90K. If you don’t ride the brakes you should be able to go a long time without having to replace pads or rotors.
Gosing, lol ya I wish but both will do your back in , don’t know if I would recommend them as a longterm profession
Sorry disc brake man. You lose. Thurston can build a house and rebuild a motor! Probably at the same time.
Don’t do pads and rotors? That’s easily 1k+ saved depending on the vehicle for like 2 hours of work tops
Ya the old cars were easy to work on . I don’t do anything on our new car. There’s 2 things I can do is build a house and rebuild a motor , after that I’m useless
Not from my perspective. The internet has transformed DIY – not much you can’t learn about on youtube or other sites.
Ya, an acquaintance I have in Vancouver who has an electrical company has been happy that things have slowed down enough to layoff his “deadweight” guys that he only kept on the payroll to keep site managers happy seeing the trade onsite.
As middle-aged Millenials my partner and I do a bit of both. For most of our renovations we’ve done the demo, painting, flooring, and assembly/install of some cabinets and most appliances. We built a deck and a shed with the help of a carpenter friend. Re-sealed the concrete ourselves. Built our own garden beds etc. I’ve even done a bit of electrical like installing new bathroom fan or wiring in the new dishwasher. However, for more difficult or critical pieces such as fixing and shaping old plaster ceilings, drywall mudding and sanding or building a new retaining wall or foundation work, we’ve left it to professionals. Even then, the amount of supervision these “professionals” need to end up with a quality final result is a bit embarrassing (for them) sometimes.
I do brakes (disc) myself, imo that is one of the biggiest money savers someone with minimal mechanical ability can do.
There’s been a cultural shift away from DIY in general. Broad generalization, but folks today are more likely to “hire the expert” rather than do it themselves compared to a generation or two ago.
Part of the shift away from DIY is due to technology . I could DIY a lot fixing my 1981 Mazda GLC, wouldn’t be confident fixing a lot on my current vehicle
” I am a little surprised at the shift away from sweat equity and fixing up an older place.”
The issue here is debt servicing costs. You’re going to chuck in $300+k on down payment to have an empty house while you renovate. If you’re doing it by yourself it takes a long time. If you’re paying someone else it makes it too expensive. All the while the clock ticks your money away to interest expense. Not to mention that there’s a chance your value actually decreases if Tiff cant get that inflation under control. So yeah not surprising at all. I think its all those boomers hanging onto their piece of craps hoping to extract the sweet sweet gainz out of the millenials who will pay for their irresponsible decades sitting on a line of credit.
Disagree, framing and carpentry has come down about~ 5% in the last couple of months.
I find myself agreeing with Patriotz, lot prices have to come down. But if lot prices do come down it will be because we are in a recession with high unemployment.
If the lack of affordability is the disease then the cure is a recession.
If the disease doesn’t kill you, the cure will.
That implies that labour and houses are getting cheaper (by the rate of inflation). If there is no recession, I think Leo has it pegged with the market sliding sideways for a while until affordability returns. I think the consensus here is that new single family housing is not going to get much cheaper. If you look at the pressure on land for multi unit buildings combined with the ever increasing building standards and expectations that is probably true. I am a little surprised at the shift away from sweat equity and fixing up an older place. Houses that need a bit of work seem to sit on the market forever these days. I completely get that the cost of labour has destroyed the economics of buying a fixer upper and paying going rates to bring the house up to an acceptable standard then flip it. That doesn’t mean there isn’t an opportunity for an individual to move in and do their own work while living there to achieve their dream of home ownership. Maybe people just aren’t as naïve as I was about how much work it is…..
Yep something has to give , as the economics are out of whack . We are 2 years into this inflation thing and the cost of labour, land and houses has not moved
Or lot prices, which are determined by what builders are willing to pay.
Or labour prices go down which is happening now for some trades.
House prices will have to start going up to make projects viable . Saw a piece where developers are going ahead with rezoning but just aren’t starting projects
general economic cycle, lots of immigrant workers on job sites now so the supply is higher.. etc.
Silly question VicREanalyst but what are people thinking that is indicative of? The costs associated with building houses are too high to be as profitable as developers would like?
Hearing increasing slowdown in trades from insider contacts, I think the trend is all but confirmed now, especiallyin carpentry and framing. Marko, you still seeing things busy as ever on your end?
An excellent and thoughtful review. Another book for my list. Thanks for that, Leo.