I read this today about Vancouver BC, and though it was worth a lazy post.
A finance professor by the name of Pavlov comments on the frothiness of it all. That name rings a bell for sure, and something else seems really familiar as well...
Comments or thoughts on our friendly neighbors to the north???
This past week, hundreds of people spent days in line ahead of the Saturday pre-sale for a new condo development on the waterfront in the False Creek (Vancouver BC) area.
Those who couldn't commit to camping out themselves hired somebody to do the waiting for them.
Chris Malkin and his team camped out for a week, representing out-of-town buyers and those who didn't have the time to stand in line.
Malkin, who says he has clients from Victoria, Seattle, and even mainland China, described the condo-buying frenzy as "fun, exciting, but insane."
With the average detached Vancouver house now costing more than $1.9 million, condo prices—and competition—are also expected to increase.
Andrey Pavlov, a professor of finance at Simon Fraser University, said that housing and the industries associated with it could account for up to 25 per cent of the provincial economy.
If his estimates are correct, that would make housing B.C.'s largest industry, beating out other areas such as tourism and natural resources.
Eric Tang, one of the condo customers, said he's looking to downsize, but also wants to make a smart financial move.
When asked if he thinks condos are a good investment, he glanced at the line and said, "I hope so. Otherwise, I wouldn't be here."
Has been this way in Vancouver for some time now. It was getting crazy in 06 (bought a principal res this year...bad idea)/07/08, died down significantly in 09 (when I ended up buying a rental condo), and then picked up the pace again.
Condo-wise, buying in 06/07-ish and after commissions, I'm seeing alot of barely break evens (case in point, my own principal residence that I sold before moving - that said, I paid less on PIT than renting an equivalent).
Buying in 2009, and it's 30% gains to today. (Caution: Sample size = 1 on this statistic... :))
Have heard Toronto is similar (lineups and so on) - funniest was seeing people pay other people to line up to buy a home...truly crazy.
This said - something alot of folks don't realize is just how land constricted Vancouver (downtown especially) is - it's not like so many cities in the US where you just continue to build outwards. In Vancouver, you hit the water or the mountains - the only way to add more people is to build upwards, hence the huge prevalence of condominums recently.
My random $0.02 for the day :)
Thanks for the post.
I have a friend living up there, and he keeps me up to date on the RE goings on. This doesn't surprise me, but still a questionable thing happening in our area--and in Canada too.
Best to you!