Vancouver Real Estate: bubble or no bubble?

[trilinearmipmap]

Two relatives are buying into the hot lower mainland real estate market. To me it brings back memories of Nortel 5 or 6 years ago. Just wanted to post a poll to see what people think.

[AndyL]

Big bubble, literally - Everyone knows vancouver is going to slide into the ocean once the big one hits... Calgary will soon be oceanfront property :mrgreen:

[Willow]

the prices has gone consistently higher and higher every year. my house has gone up 40% in the last few years. i would consider purchasing real estate in vancouver a good investment, with the olympics coming soon they are investing a lot of money on new business and amenities in the city.

[Samw]

Some articles on Real Estate bubble:

Spike in housing prices raises risk of bubble
http://www.canada.com/vancouversun/news/business/story.html?id=ca90ba85-e8ab-4f35-879f-72f60c806871&k=42447

Housing bubble warning for hot Vancouver market
http://www.cbc.ca/bc/story/bc_housing-bubble20060404.html

Booms, Busts, and Where Opportunities Occur
http://finance.yahoo.com/columnist/article/richricher/3413

Japanese Housing bubble pops and prices slide for 17 straight years losing about 80%
http://www.investmentu.com/IUEL/2005/20050328.html

Other Bubbles to remember:
http://www.businessweek.com/2000/00_17/b3678084.htm
On Jan 3, 2000, CMGI closed at $163.22. Today, CMGI is $1.48.

[aquanot]

It's largely due to the hype created by the media looking for or creating a story which is fueled by gready people in the ''unrealestate ''business and ''investors''. It's kind of funny how the media doesn't do a story on what a rippoff it is. I know a builder that makes 200 thou. from a single house .I was even shown the paper work to prove it. I think I'll wait for the 50% off sale when interest rates go up a few % only problem is if it happens , I'll be out off a job.

[EmilyB]

Not just Alberta is boasting at least a ten year economic boom...:biggrin:

[Bartman]

It's the buyers' fault here. Developers from Toronto and elsewhere are bringing their projects here to sell because they can't sell in their own market. West Coasters seem to be buying anything. People are lining up to spend $200K-$600K in the new Woodwards building and it's in the middle of the poorest postal code in Canada. It can't continue. The lunatics have to run out of money eventually. :2gunfire: :grab:

[Willow]

Actually, I think there is no shortage of such people.
- Xtasia.

[StirCrazy]

I have 3 Friends that are in the real estate business here, and my mom manages two offices in Alberta, they have all been looking at this and they say the bubble will not pop, you might see a plateau in about 4 to 6 years but not a drop, now like anything there are things that could happen that would change this so like the stock market it is always a gamble. one thing going for us is the government knows the average Canadian family has 60 to 80% of there after tax income tied up in there house so they will not let interest rates go to high like in the late 70's.

Steve

[wetcoast]

I am in the process of getting ready to move back to the West Coast from Winnipeg Manitoba. I left in 2001 for a job out here, and the winters have started to get to me. Since then I have been able to purchase a house (100k) and live very comfortably in a mid 80s job. I have just started to look and find that housing is 3-4x the amount I Currently pay and wonder how are everyone else doing it and getting by? I am out of debt, with the exception of the mortgage, and don't understand people are to keep ends meet, let alone purchase aquarium related stuff, let alone raise a child like I am thinking about in the near future..

If I was to purchase a house at $300,000 (it would be something meager and a fixer upper no doubt I would assume) - at a 25 year term, that would equal out to about 1850 as a mortgage payment at current 5% rates. Thats 500 dollars per month towards my principal and 1250 on interest alone!

While I do not want to rent, I see no other choice - I will be throwing my money away at interest all together, when I could potentially invest that money and hope to get a return on it.

What is the average income that someone requires to actually live now?

Confused, about trying to make potential ends meet.

[Doug]

Its the same out here also, but our prices are lagging behind because of where they started. Its hard to believe the market will crap out like before. To many people, have to much invested.

He,he. I remember my friends locking in @ 18.75% for 5 yrs. just before it jumped to around 21%. They were so happy but soon after, down she went. We got 12.75% not long after. :smile:

[SeaHorse_Fanatic]

Dave,

There are no fixer uppers for $300,000 in the Lower Mainland anymore. If you head much farther out, away from the Vancouver/Burnaby/Richmond core, then you might find something in the Valley. A crappy place around here is $400,000+ now.

People are crazy. They lined up all night for a chance to buy one of 8 townhouses/condos up in Port Moody at over $400,000. Those who bought just grabbed the closest one & they sold all 8 units in 15 minutes.

Imagine having to make a life-altering decision in under 15 minutes & tying up your wages for the next 25 years that quickly. "Honey, who cares if its ugly, lets buy it now & worry about it for the next quarter century later." Crazy.

Anthony

[wetcoast]

What is the average price for rentals out there again?
I'm still trying to figure out how people are making ends meet with a hefty 50k/y income

[SeaHorse_Fanatic]

Rentals will range from $900-1800/month depending on area & size for a suite-small home. Housing prices, including rentals, are nuts.

[trilinearmipmap]

OK my plan is to resurrect this thread annually for the next two or three years and see what the outcome is.

[midgetwaiter]

If I was to purchase a house at $300,000 (it would be something meager and a fixer upper no doubt I would assume) - at a 25 year term, that would equal out to about 1850 as a mortgage payment at current 5% rates. Thats 500 dollars per month towards my principal and 1250 on interest alone!

While I do not want to rent, I see no other choice - I will be throwing my money away at interest all together, when I could potentially invest that money and hope to get a return on it.


My brother just got moved by his company to Calgary from just outside London Ont. He was looking at moving from a nice $145k house to a $300k crack den. I drove around with him for days, it was just depressing but we got really lucky and found a nice place that just went on the market and hadn't recived much attenton yet.

He's a very well paid engineer type, it was just the timing that left him with out any money to make a large down payment so he would have been looking at a silly mortgage payment like you describe.

I don't have any real estate experience to speak of but I think any time you get in a situation where real estate is all anyone talks about anymore leads to bubble behavior. It might be a protracted bubble but you can't make money out of thin air like that without there being concequences.

[Invigor]

..SASKATCHEWAN RULES!

:drinking:

however, I don't see housing prices going down anytime soon. the average house since last summer has increased about $40000 in...10 months...and that's here!