There's a Crisis Brewing for Vancouver Real Estate Developers

[@nicolasbenson009]

Great video! For 2024, it’s hard to nail down specific predictions for the housing market is because it’s not yet clear how quickly or how much the Federal Reserve can bring down inflation and borrowing costs without tanking buyer demand for everything from homes to cars.

[@BridgetMiller-]

I suggest you offset your real estate and get into stocks, A recession as bad it can be, provides good buying opportunities in the markets if you’re careful and it can also create volatility giving great short time buy and sell opportunities too. This is not financial advise but get buying, cash isn’t king at all in this time!

[@tatianastarcic]

You are right! I’ve diversified my $450K portfolio across various market with the aid of an investment coach, I have been able to generate a little bit above $830k in net profit across high dividend yield stocks, ETF and bonds.

[@berniceburgos-]

That's fascinating. How can I contact your Asset-coach as my portfolio is dwindling?

[@tatianastarcic]

Certainly, there are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Melissa Terri Swayne” for about five years now, and her performance has been consistently impressive.She’s quite known in her field, look-her up.

[@Michaelparker12]

She appears to be well-educated and well-read. I just ran a Google search for her name and came across her website; thank you for sharing.

[@austinbar]

Housing prices are unlikely to decrease until there's a substantial increase in housing supply. there's a shortage of millions of housing units in Canada, and construction isn't keeping pace. The constant demand for housing, coupled with population growth, means that even a slight price drop attracts numerous buyers who quickly absorb the available supply.

[@eloign7147]

I sold a property in Q4 of 2022 and I'm waiting for a house crash to happen so I buy cheap. In the meanwhile, I've been looking at dividend stocks as an alternative., any idea if it's a good time to buy? I hear people say it's a madhouse right now.

[@rogerwheelers4322]

Home prices will come down eventually, but for now; get your money as much as you can, out of the housing market and get into the financial markets or gold. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes. If you are in cross roads or need sincere advise on the best moves to take now its best you seek a pro who knows about the financial markets.

[@joshbarney114]

I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor, seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million...

[@FabioOdelega876]

I think this is something I should do, but I've been stalling for a long time now. I don't really know which firm to work with; I feel they are all the same but it seems you’ve got it all worked out with the firm you work with so i surely wouldn’t mind a recommendation.

[@joshbarney114]

I definitely share your sentiment about these firms. Finding financial advisors like Marisa Breton Dollard who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.

[@tonylinardi3089]

Canada needs to focus on producing things other than Real Estate, it's not a healthy economy when everything revolves around housing speculation The bubble needs to burst, and foreign investors need to be controlled. Values are so overpriced that we have a generation that has lost hope of ever owning a home.

[@supermash1]

You could have said that 10 years ago - but crickets from the government. Now they're telling us that they are going to borrow billions to build a house every 5 minutes. Sure thing junior. Now that the politicians are going to get their useless butts booted out of office.

[@frankpeng2448]

The problem is, entrepreneurship is non-existient as the government policies and high taxes discourage potential investors from starting small businesses. Everyone knows that the main driver of any GDPs are small businesses. They are the main creators of jobs. When you have all these obstacles going against hard working entrepreneurs who saved up their hard earned money ready to invest, where else to invest? Real Estate. Driving up housing prices while the local economy is in taters.

[@Observer168]

You can’t compete with China in production unless you make high end goods like Canada Goose

[@olgatempel3466]

@@Observer168 Or you place tariffs on chinese products ....or you can shame Canadians into buying Canadian made products

[@Observer168]

@@olgatempel3466 Canadian products would cost 5x as much. Go support buy a Canada Goose jacket and see how much it cost.

[@PaulKatrina.]

fear a housing crash due to people buying homes above asking prices with little equity. If prices drop, affordability and potential foreclosures may arise, worsened by future layoffs and rising living costs. I want to invest more than $300k, but I'm not sure on how to mitigate risk.

[@SandraDave.]

Consider reallocating from real estate to other reliable investments like stock, crypto or precious metals . Severe recessions offer market buying opportunities with caution, as volatility can yield short-term trading prospects. Not financial advice, but it may be wise to invest, as cash isn't ideal in this period.

[@RaymondKeen.]

It's often true that people underestimate the importance of financial advisors until they feel the negative effects of emotional decision-making. I remember a few summers ago, after a tough divorce, when I needed a boost for my struggling business. I researched and found a licensed advisor who diligently helped grow my reserves despite inflation. Consequently, my reserves increased from $275k to around $750k.

[@Hectorkante]

nice! once you hit a big milestone, the next comes easier.. who is your advisor please, if you don't mind me asking?

[@RaymondKeen.]

Finding financial advisors like Melissa Terri Swayne who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.

[@ScottKindle-bk3hx]

I just looked her up on the internet and found her webpage with her credentials. I wrote her a outlining my financial objectives and planned a call with her.

[@anthonym9130]

Same in Toronto New condos not selling

[@segasys1339]

source? Toronto gets 690k immigrants a year condos will moon forever.

[@D5MDJM7738]

I've been working with condo developers for 10 years and can tell you that's true. Most developers haven't been able to sell their projects in the last 48 months. Google it and you'll find some articles

[@davidrockefeller2007]

I heard this as well.

[@anthonym9130]

@@segasys1339 Lol average income for immigrant first 5 years is 35k its more about affordability than numbers.

[@segasys1339]

@@anthonym9130 1)ikea sells bunk beds for $69 2)average immigrant only needs 69 sq ft of living space I calculate bunk beds will allow Toronto real estate to moon until at least 2040

[@AshrafulAlam-zw1xw]

170ks Realtors in Ontario. 😅😅😅😅😅. WTF.

[@NicBam]

It's the next Amway

[@yourmainful]

it u got a pulse, able to read english and can take a dump, you are able to become a realtor in less than 1 month in this mickey mouse country.

[@silver-en7kl]

Interest rates aren’t going down until it’s too late. Look at the 10 year yield, it’s going up and that is where mortgage $$$$ come from.

[@tomacml5741]

Yup, the investor class set the mortgage rate not BoC.

[@sid.kavalu]

Great breakdown. Since we've avoided the 2008 housing correction in Canada. The next one will be devastating here.

[@markz1013]

They are doing their best to avoid this one too.

[@TheBlindandDeafLifeGuard]

The government is pulling out all the stops to keep the Banks from crashing. Open immigration up Keep supply low JT watched this for 8 years under his watch and did nothing.

[@baseline6786]

As prices only went up 150% and by 2034 another 70%

[@JohnLee-]

It is here ,unless rate go down.

[@segasys1339]

source? Don't fight the BOC/infinity immigration moon soon real estate bro.

[@skinnaj]

Great interview with Sam Cooper this week Steve.

[@Matt.k864]

Speculators ruined the Canadian housing market now the homebuyers just going to wait on the sidelines

[@jtome84-91]

Trudeau printing more money then can even be counted and bringing in 5 million people in 4 years ruined the Canadian housing market .

[@edubmf]

if you can afford an 800k house you have a good job if you have a good job just emigrate to the usa don't pay the filth nearly all your wages for the right to exist

[@GameMakerX]

no.. socialist spending beyond governments means... now government panicking by keeping interest rates high. that's manipulation.... socialists clutching their pearls.

[@gcc8584]

Canadians destroyed the Canadian housing market by voting to destroy and un-diversify the economy that originally made this a wealthy country. With no other way to build wealth, Canadians poured into real estate as it was seen as the only road to financial independence. Add zero interest rate policy to the fire and was rinse repeat for 25 years and here we are. Canadians are hopelessly obsessed with RE and can not see a way forward without it. We did this to ourselves.

[@shanenickolson644]

Foreign money laundering is what has ruined Van and Toronto.

[@Glin-z1t]

I warned that speculators would be the first to flee this market months ago. That's how it starts, my friend.

[@RainCity3rd]

well yeah... and water is wet. of course speculators are going to bail before people give up their primary residence. And investment is entirely different from where one lives.

[@DJRS2178]

​@@RainCity3rd if you can no longer afford where you live you will bail as well.... higher interest rates, inflation, higher taxes, looming job loss, stock market crash.... what could go wrong?

[@sean4060]

This is not get news for our economy since much of our GDP relies on real estate. The government is forcing a deep recession as real estate continues to slump

[@supermash1]

@@RainCity3rd "investment". You mean bald-faced greed and rampant speculation.

[@RainCity3rd]

@@DJRS2178 obviously at some point but people will do vastly more to hold onto the place they live over an investment. Most people have plenty to cut back on if they need.

[@geraldbrowne]

High net worth facades? They are usually more leveraged than average person. Wait for the illiquid moments . Vancouver high net worth can become debt burdens no one wants. = land poor!!! The more you make the more you spend. Mostly not expecting cash flow velocity to stall. The only way you know the health of the Vancouver high net worth is to look under the hood. How many high net worth individuals went broke in 2008-2011 and never recovered? The number was staggering.

[@Observer168]

The ones that held and got richer are far more staggering. Houses have more than tripled since 2008

[@NicBam]

0:40 in, and you just said, "The housing market has been unusual?" You think? Unusual is an understatement. The market, bankers, agents, brokers, etc., have all taken advantage of the artificial inflation over the last four years (due to all the money printing and foreign money purchasing residential real estate, essentially removing the asset from Canada in the droves of immigration, etc.). Every one of them has ruined this country.

[@jackwu5168]

Condo mkt is over supply. 91 units just come out for resale at Concord Brentwood

[@edubmf]

> all of a sudden you go from positive cash flow to negative cash flow so you're the patsy all along, you were telling all your friends it was easy money you didn't understand international debt at all, and in hindsight you had the understanding of a young child

[@supermash1]

Band Wagon

[@the-btc-tradingfloor2808]

💯

[@frankpeng2448]

The over leveraged investors will pay. In a way, that's a good thing. Over leveraged investors shouldn't be in the real estate market anyways. It is like buying stocks on margin.

[@martinrev8487]

A greedy young child.

[@TimBer-y3y]

You have nots all know everything. This whole thread is filled with people who never accomplished anything. Hoping for someone else to fail is no way to get ahead. Even if house prices in Vancouver are slashed in half. None of you simple minded people will own anything. You’re surfs you just don’t know it

[@bryankerr9174]

At what point will all the beautiful views in Vancouver be blocked out by one-bedroom condo towers?

[@listonshaw454]

Great analysis as always! And not all of Surrey is blue collared, maybe visit Elgin Chantrell, Morgan, white rock, ocean park...

[@DJRS2178]

Steve can see now. The cycle was over in 2021. Demand is down, mortgage applications down massively, prices trending down, supply trending up. We were in the complacency stage, anxiety is setting in, next comes panic, then capitulation. Imagine what happens when the stock market keels over this year, along with the crypto market, all while people are realizing what is happening to the real estate market.... ordained collapse of all markets. The solution, UBI - universal basic income and CBDCs

[@richardpowell1389]

Nonsense

[@aaz1992]

Not the solution we want lol

[@DJRS2178]

@@richardpowell1389 keep coping, hopefully you have a solid job as we enter a recession

[@DJRS2178]

@@aaz1992 nope but what can we do? they spend billions on ukraine, fund "projects" that are a waste, fuel the drug crisis, force us to wear masks.... they have people by the balls with debt levels at all time highs, the big squeeze is upon us and majority don't see the snake.

[@s82002]

This used to sound like conspiracy but as time goes on it’s starting to seem a little more plausible. I can’t believe I just said that😂

[@patrickw8453]

Construction sector is 8% of the labour force but only 1% of migrants entering Canada go into the construction sector. I've been in the condo market for over 20 years. We are abandoning owner occupied units and now building rental units only as well as retirement homes. Single family homes are now being replaced with multi build towns.

[@edubmf]

housing will get built speculators go bust, they sell the land at fire sale prices someone else buys it cheaper, builds cheaper housing I know you don't believe in the free market Steve, but here it comes

[@s82002]

I really hope you are correct. Unfortunately I am of the belief they are trying their best to engineer that from happening though some financial back door bailout program to keep this market propped up.

[@markz1013]

​@@s82002Exactly but it will only work for so long.

[@RainCity3rd]

exactly. Like any market, those who were taking more risk are in trouble. The big companies who have diversified cash flows and tons of money and leverage has been stocking up cash and just waiting to buy distressed land, even half completed buildings. This isnt some new thing the industry is cyclical. Those who have been in the industry 30+ years have seen this multiple times before.

[@edubmf]

@@s82002 CAD is tiny they can't prop this up. why didn't argentina "prop it up"?

[@HaydonAshurstFamily]

Fantasy

[@bonny420]

remember back in the day when people bought a rental property and the renters were mortgage helpers, NOT solely responsible for the whole mortgage taxes and insurance?

[@curtis1397]

That has never been the case, mortgages were just cheaper so rent was less. Landlords always charge enough to cover all their costs. Mortgage, property tax, etc... if they didnt then they went broke.

[@alexgardner3125]

Nobody remembers this because it was never the case.

[@donm2067]

​@@alexgardner3125oh yes it was. A Basement apartment was referred to as a mortgage helper, not a loser who has to subsidize my lifestyle.

[@donm2067]

​@@curtis1397that's why people who had CASH invested, not people with helocs. People put up 30% on a well priced unit and rented at market value, not take out a giant loan for a unit at any price and stick someone else with the bill.

[@cavelleardiel]

It used to be in law suites for actual family members. Then there were those people who lied and now it has morphed into a HAVE to have to afford a hom.

[@richyrich3285]

Steve, do you have any insights into the real estate market in Kelowna? Or anyone on KZbin that would be a good follow for this information? Thanks!

[@segasys1339]

According to my research Kelowna housing will keep mooning for several years. Buy now.

[@madJesterful]

I am not a realtor... just a guy trying to buy a house for a few years and being disgusted but here are my opinions. Kelowna is fueled from spillover from Vancouver. 1) retiree sells in GVRD (+1 net housing in vancouver) 2) retiree buys in Kelowna (-1 net housing in kelowna) we both know kelownas actual economy is pretty service sector and what happens locally comes nowhere close to compelling people to move here for work. Lets be honest. In fact as remote becomes harder to do people may have to leave. So in past years a strong sellers market in Vancouver is going to mean a strong sellers market in Kelowna. But even more so because of the effect on supply. If things are bad for sellers in Vancouver this year they will be worse for sellers in kelowna (again due to that knock on effect). Realtors in Kelowna are keen to tell you how that effect always makes "number go up" they never tell you what happens if Vancouver "number go down". This is a similar effect to what happens in Victoria and some towns on the island. Looking at Victoria+ area prices are way down year over year I know because I was looking at this time last year. Could not find anything I wanted under a million, there are not plenty of sales under 1m and many of the listings I marked sold under ask. Their market opens up earlier than in Kelowna. So far kelowna prices seem kind testing the waters and similar to last year at this time but with mortgage rates going up this week and BoC I am really curious to see what will happen.

[@scoop3894]

Interest rates normalized and real estate "investors" just figured out they are nothing more than leveraged bond holders on the wrong side of an illiquid market.

[@hersdera]

I think it's time to make it more appealing for potential buyers. Real estate can be quite the rollercoaster! the stress and uncertainty are getting to me. I think I'll cut rents to attract potential buyers and exit the market, but i'm at crossroads if to allocate the entire $680k liquidity value to my stock portfolio?

[@ScottKindle-bk3hx]

"Overall, buyers hold a lot of the cards right now, and sellers are having to give out more concessions to close a deal." All the best, buying on sale is actually one of the best ways to invest in stocks, and advisors are ideally suited for such task

[@DorathyJoy]

Until the Fed clamps down even further I think we're going to see hysteria due to rampant inflation. If you are in cross roads or need sincere advise on the best moves to take now with financial markets will be best you seek a fin-professional with fiduciary responsibilities who knows about mortgage-backed securities for proper guidance.

[@Hectorkante]

this sounds considerable! think you know any advisors i can get on the phone with? i'm in dire need of proper portfolio allocation

[@DorathyJoy]

There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’ Melissa Terri Swayne” for about five aiyears now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.

[@wc4109]

Developers will soften or stop building altogether… the only builders are the Federal Government, said they’re building 3.9 million homes by 2031… Assuming they can build that many homes…

[@RainCity3rd]

the big developers keep building. They have a huge backlog of sites, they are vertically integrated and thus need to keep people working even at much lower margins even break even. they also have lower costs being much larger than do medium and small developers though.

[@Observer168]

Government doesn’t build anything, they just give interest free loans to developers to build.

[@nickd9274]

RIP those who piled in again on rate cut hopes

[@uncubicle5993]

steve is still so busy with real-estate deals he doesn't have time to water his plants. Look behind him.

[@PatrickNovotny]

😂

[@simonjochlin7589]

This is 101 stuff, no crystal ball needed. Misalignment of incentive structures across the board for decades (not years). There is a reason cars require regularly scheduled maintenance... so that it never gets to this point. That required foresight back in 1999. Not reactions in 2020s.

[@Picklemedia]

Can you 101 me the income to housing ratio projection for 2025?

[@daveberlando4399]

Great update as always Steve....any comment on the Kelowna markets, especially all those condo projects in partial completion?

[@millionaire233]

No mention of the new Airbnb rules?

[@ericzimmer]

Why are construction costs so high? And what can Canada or BC do to fix this? Or at least can I vote for?

[@milhouse8166]

A lot of people don't realize when real estate goes up, everything goes up. Contractors need a place to live, products need a place to be sold from. It's all connected.

[@stormforge68]

There’s also a lack of blue collar construction workers. Not enough people want to work in trades. Consider how many trades people will retire in the next 5+ years, and you have a recipe of even higher construction costs.

[@milhouse8166]

@@stormforge68 it's not lack of workers. It's moreso land prices materials, permits, etc. You want construction workers to work for minimum wage? ☠️ Get a clue and don't be so anti-human

[@stormforge68]

@@milhouse8166 When my electrician comes to my place and charges me over $270 for a half hr troubleshoot and repair, I fail to see where he’s making minimum wage. Same with the plumber I had to call to do some work. All independent, reputable trades I deal with have a minimum charge out rate plus time on job site rate. So no, skilled trades make good money and not minimum wage as you suggest. And if you google “shortage of skilled trade workers in Canada,” you’ll see very clearly that I’m correct. If skill trades retire and there are no new replacements, labour cost goes up. Developers and builders will bid on existing trades and jack up labour costs. This in turn allows trades to charge and make more money. I know I’m right coz I’ve talked to a builder, and he’s complaining how much more he has to pay trades compared to a couple of years ago. Big developers building condos soak up excess trades, and builders have to compete for scraps. So again no, trades don’t make minimum wage. Maybe trades make minimum wage where you live, but not where I live. So someone needs to get a clue and get his facts straight before bashing someone as anti-human. 🙄

[@quinn-wf3kk]

No more Chinese real estate investment!!

[@pizzazzsnudge7800]

American investors play a more significant part in driving up Canadian housing prices (even in BC) than Chinese. Just not as easy to blame people you can’t identify visually. But I agree all forign investment should be curtailed, access to housing should be a human right not a way for rich to get even richer as a middle man producing nothing of value.

[@quinn-wf3kk]

@@pizzazzsnudge7800 What bothers me is that there doesn't appear to be reciprocity. Not sure I can just buy a place in China albeit I can in the US. Gosh I didn't know American investors are driving up the prices though. Thanks.

[@pizzazzsnudge7800]

@@quinn-wf3kk I have no idea if we could buy property in China, I haven't heard anything about not being able to but not sure. I think its completely valid to be upset that any foreigners are able to buy up Canadian housing as investments. If someone is going to move here and live in the house then great but to just own and sit empty or to own so many places at once, imo they are getting rich off of a basic human right, imagine if private industry or rich individuals could buy up all the fresh water or electricity supply and then sell it to us at twice the price as a middle man. Anyway my point was that its a policy problem and and also a rich American neighbors problem and yes a smaller percentage of other foreigners too but all I ever hear is people jumping to blame rich Asians when its just a part of a bigger issue. People and corporations are being greedy but our capitalist system encourages that, we need strong policy changes at all levels of government, city, prov. and federal.

[@AndreasConrad-p2e]

quite the insight. Thanks. Can you say a word on vacant multi family 4 story walk ups? Never in my past 30 years in vancouver have i seen so many boarded up building just sitting there. With the housing crisis in full steam why would these buildings not be occupied to the day they are torn down?

[@Observer168]

It’s because it’s nearly impossible to evict them

[@mandrews1245]

Because not everyone's lease ends at the same time. So it takes months if not years until all the tenants are out. Then it usually takes a few years to go thru the city, provincial and environmental planning boards to get approval for building a new structure.

[@cyalexwang1421]

VanRE only goes up right Steve?

[@darlingdear2687]

The next federal government needs to curb immigration and create incentives for Canadian families to grow (like universal daycare) , get rid of carbon and other idiotic taxes and cut all the idiotic liberal spending programs (like 4B on digitalizing private business), deflating government bureaucracy and corruption.

[@ADobbin1]

where I live in small city ontario I'm seeing a lot of more expensive houses going on the market and then sitting for months. One I saw 8 months ago for 800k, it sold and now its back on the market.

[@martinrev8487]

Luxury is really taking a hit. I think there is much further to go (even without a crash), especially in the Condo (tor/Van) market as so much luxury was built the past 10 years. So few can afford this stuff with the real economy floundering. My goal is to get a place at the Shagra La in Toronto during the next RE panic (hoping for at minimum, a 1990s opportunity). I've been watching the market for half a year now (Shang), nothing but price cuts and re-listings after failed sales attempts.

[@mandrews1245]

@@martinrev8487 Just remember in hard times prices go down, but Condo fees skyrocket!

[@landlice48]

As a past landlord of many rental properties, there’s not a chance for property investors to even want tenants unless their are vastly improved conditions for landlords. Sadly, many tenants damaged our townhouses and often if they moved, they took our appliances. Too many failed to pay their rent in a timely manner and some res=fused to move out. Nope, there’s no chance investors want to risk their capital on this.

[@shelbzillathrilla]

Did you get a real job and leave feudalism behind?

[@psrandz]

Salty? ​@@shelbzillathrilla

[@brianpereira7483]

The 1990 japan numbers dont lie, just takes time

[@OffTheBeatenPath_]

You forgot inflation

[@Observer168]

Canada is nothing like Japan

[@Observer168]

Time is ticking for all of us as well. You can’t wait forever to buy a home

[@andrewcrook2240]

Same story in TO! Im telling ppl divest your mortgages. Downsize if needed. You do NOT want a mortgage going into 2025+ investimg in RE is a smart as inveatin in RE in 2007 right now. Same for stocks. Get liquide ppl get cash, get ready for deals.

[@alvc22]

How does one find out if a development project is getting foreclosed or litigated?

[@Picklemedia]

Don't worry Christia Freeland will fix unaffordability with our money

[@justadildeau]

She will free up the cash in your bank account

[@shabnemafzal4934]

😂

[@ducatidude4483]

😂 it's like the plot to a bad comedy.

[@marieaupecle8929]

She will be in jail before you know it.

[@Joe-mz6dc]

@marieaupecle8929 Sure. Keep us posted.

[@rosswatson9144]

The problem is people see the absurdity of the pricing from a Canadian perspective instead of looking overseas to countries like Japan and China Singapore and Korea we’re considering the footprint of a Vancouver house. The prices are still very reasonable, and a great investment opportunity.

[@jadejackson1509]

I wonder if increasing capital gains tax on housing sales in corporations reduced the math for investors on short term housing changed the math for investors. In the 80s and 90s we saw this exact same thing. Skyrocketing prices, rising inflation, interest rates increased, housing dropped more than 25%, for the next 5 years prices were relatively flat before correcting but still 15 years later the total gains were only about 6% annually and weren't beating the stock market, nominally prices may be up in 5 years, but in real prices housing will be going down for another 5 years. Investors have no interest in buying these products that aren't going to keep increasing in value when they're already overvalued and don't make sense. The condo market will lose value and as such the single family homes will start to slow down, if you can't sell your condo, and can't make any profit from your condo, then you can't pay 1.5 million for a home. In 3 years single family homes, adjusted for inflation, will be worth less than they are today. Just as they are lower than they were in feb 22. Housing is going sideways. Infact it's down. And if the market is sideways for 5 years with 3% inflation that is a major reduction in real value. All while the stock market continues to beat the housing market and while mortgage rates are huge. Ya ya, mass immigrations, but you can only buy so many houses with uber, and when those student numbers start to drive up, or a recession hits stronger and crushes the slumlords ability to extract wealth from these poor international students. The current shift is to look at housing starts. The market isn't going to continue going up in the short and medium term, and buying property for the next 5 years is a mistake. You'd be far better off taking that downpayment and plopping it in the market or a gic for 3 years and then buying, prices will be the same (or lower) and you can in the meantime get 5%+ interest rather than paying huge amounts in transfer costs, to a realtor, in interest payments, etc etc.

[@SS-mz9oz]

Lot of East Indians in Van building those duplexes, they can build for cheap as their experienced and make a good return with good margins. Probably building for less then $300 psf.

[@jamietoro8373]

First time i watch your video very informative about Vancouver real estate.

[@antonburdin9756]

Either home owners are losing some equity (land value in particular), or we are all dealing with inflation (wage-price spiral), or some combination of both (stagflation), there are no other ways around to fix affordability.

[@supermash1]

Stagflation doesn't "fix affordability" fyi.

[@antonburdin9756]

@@supermash1 , how would you call situation, when relative price of real estate is decreasing while disposable income of those who are still working is rising?

[@guitarpicker7464]

Even the "high net worth" will be subject to massive increases in "property tax" ... 30, 40, 50,000 /yr in property tax will bring "equity" to the property market.

[@AlexSuperTramp-]

there should be an income limit for rent control. I’m renting downtown for 1400 a month while saving close to 20,000 a month due to high income. My LL is getting absolutely hosed

[@HaydonAshurstFamily]

Appreciate your objectivity. I’m an LL renting to long term tenants. My net income is literally 1/2 what it would be if I were getting market rents. And if i had any leverage I’d be completely screwed. Many LLs w long term tenants are selling to extricate themselves from this situation

[@AP-wq9dv]

If you are paying $1400 a month downtown you are living a dump. No matter what your savings are. An average 1 bedroom is $2600 downtown

[@AlexSuperTramp-]

@@AP-wq9dv it’s called rent control, that’s the point of my comment

[@proudcanadian1837]

It starts in the condo and pre sake. Let's see what comes as the cracks continue to grow....

[@sketchin6993]

This means things are working. Developers who bought land with intention to build luxury condos funded by flippers who would sell to money launders will go bankrupt. Then developers who will build affordable condos for the working population will buy the land at a discount and presale to people who will intend to live in the condos. If flippers try to come back into the market, that just means taxes need to be raised further to flush them out.

[@HaydonAshurstFamily]

Fantasy. Lol

[@alwaysthinking2175]

there are so many builders in the vancouver market that need to buy and keep going.

[@ivanandreevich8568]

Steve, can you make a video on the presale market? Why isn't there a massive collapse in that space?

[@katherineridley6028]

Who moves to a a vast country to move into a box

[@shanehall8909]

Thanks for telling us the real story out there Steve. You seem to be one of the few realtors we can trust.

[@Picklemedia]

He must have had a near-death experience because he wasn't talking like this even a year ago

[@successfullguy]

Nice to hear a realistic take on things

[@ashp4251]

As in many other countries, non residents should not be allowed to buy here. Speculation and investing should not be allowed for something as essential as housing.

[@windatar6351]

We need a crash, but more then that we also need to make sure that there isn't corporations ready to buy the houses once the market crashes. Banks need to let these toxic loans default, but the government needs to put in a ban for corporations and hedgefunds and investors from buying up the units for peanuts once it happens. Housing needs to get back realistic prices, 2 million homes need to go back to being 400k homes, 500k condos need to drop back to 50k units. When this happens rents will also drop, 3k a month for a one bedroom needs to go back to 400 dollars a month like it was 25 years ago. A lot of people are going to hurt, but the market will even out over the course of a few years and once the dust settles Canada will be much stronger then it was before. We'll also get affordable homes in the hands of Canadians. Cheaper housing will also create a new PROPER child boom since it will be less expensive to have kids. Next we need to cut immigration down to nothing. We need to let the market heal, to do that we need to either have a net 0 immigration policey or even a negative population cap. To offset the pain, we need massive canadian investment into alberta and our energy sector and resource extraction in the western provinces, and we need the eastern provinces to bring ALL its industry back to canada to get productivity up.

[@Observer168]

Go to Manitoba, Alberta or Saskatchewan if you want a cheap home

[@martinrev8487]

@@Observer168 There are some beautiful properties in the nicer neighbourhoods of Winnipeg and St.John's NL for just over 1M. Assuming you're not tethered to a job location and not I need of fashionable tor/van city stuff you could do well looking there.

[@Observer168]

@@martinrev8487you can buy a brand new detached townhouse for 500k in Winnipeg.

[@Observer168]

@@martinrev8487 $394,900 1288 Fernbank Avenue Winnipeg, Manitoba R2V5E4

[@mandrews1245]

@@martinrev8487 -- Who has $1 million for a home? Certainly not any number of the single men and women who are marrying later in life, or single parents. You need 2 wage earners and probably the in-laws living with you to afford $1 million... Where will a young family ever get the downpayment?

[@abcdefghijk8223]

It always cracks me up that developers are like. Ok, I just won't build then, I understand but no one would ever say that about any other business. Oh I'll just stop working then! Like these developers will not make any money then, ok, but that's kind of the point of a business.

[@martinrev8487]

They will just hold bonds at the "risk free" rate until their is a better use for their money. If this goes on long enough jobs will be slashed. Hint - more unemployment will facilitate a further decline in RE prices. This could get really ugly.

[@mkultra2242]

I read through a lot of the comments and overwhelmingly I see a message that housing is too expensive in Vancouver (Canada in general) and that a crash is inevitable in the coming months/years. This may prove to be true, however I don't see this happening. Honestly I was on this same bandwagon for many years and stood in disbelief as housing just became more and more unaffordable. Surely a crash was just around the corner? It never happened, and I don't see it happening now, or at least not to the scale that some pundits are calling for. The reason is simple - DEMAND. Vancouver isn't some small town in the middle of nowhere. It's a city that given the chance most Canadians would be happy to move to. What's stopping them? The cost of living is crazy high. Personally I think the real issue isn't the high housing and rental prices, it's the fact that wages have not increased to anyway near the level of inflation for the past couple of decades. This means more borrowing for the standard citizen to afford what they used to be able to without incurring debt. It means a lowering of living standard for most people. I last got an increase nearly 2 years ago and feel privileged hahahaha. But that raise didn't actually compensate for all my rising costs and resulted in very little net gain once taxes came into play.

[@Observer168]

The value of money always goes down. Assets will always hold value as currency becomes worthless.

[@martinrev8487]

Property taxes, interest rates (what your buyer need to be a buyer), insurance and maintenance costs are a helluva drug. Gotta look at the carry as well. PS homes deteriorate over time.

[@Observer168]

@@martinrev8487small price to pay when the asset goes up hundreds of thousands a year in value, especially detached homes in Vancouver or Toronto

[@jgalt5002]

@@martinrev8487assets aren’t only real estate

[@silverfox1234]

Why would they not be able to hit presale targets? Are investors the only people looking for condos or is it a combination of regular people looking for a primary residence fighting for units against investors? I was under the impression that we have a shortage, so why would the developer not be able to hit his target? Lastly, if the prices are to high, they will give discounts in order to sell the units. So i think this is policy chang is a good thing and ur hearing complaints from investors wanting to play monopoly with the housing market.

[@RainCity3rd]

investors were buying most places. People than need to actually live in the place dont have 600k+ for a one bedroom.

[@Observer168]

You don’t need 600k… just the 20% down payment and qualify for the rest. 100k salary would qualify for 450k.

[@dennishoule2570]

Who can afford million dollar houses

[@connarvangrant6141]

You’d be surprised. A lot

[@abcdefghijk8223]

I get it doesn't "pencil in" for investors. But it does if you get a 20% discount :)

[@mikep4869]

It sounds like supply will be very tight in 3-4 years. Best buy something now and wait.

[@veeo987]

If that's the case, it could mean a crash in the land market. Then if that happens, it might become cheaper to build your own house in some areas in Canada.

[@geggs1]

It won’t ever crash. Way too much money on the sidelines just waiting for any kind of dip.

[@maxamillion8384]

Hello Steve Big developers are in a liquidity crunch i know 2 of the largest both are scrambling for cash

[@chriswiens9706]

Condo's are going to DIE! No one wants to pay through the roof in interest for a tiny box. Many developers are making these places with low quality materials and trying to puke them out for the cheapest price possible. I've heard horror stories of new builds. Major flooding in brand new condo buildings.

[@dman9416]

Nope

[@Observer168]

Just look at Hong Kong, Singapore and Tokyo. High density is the future

[@chriswiens9706]

@@dman9416 nope what? lol more context?

[@breeve12]

Why was condo sales data only beginning to be collected in 2017? 🤣

[@geraldbrowne]

The math doesn’t work when you can only borrow 3X to 4X vs income . Buy houses are still priced for 5X to 9X at low single digit interest rates. Money velocity has stalled

[@Picklemedia]

Solution: Muh Putin Pinting Plan?

[@segasys1339]

Source? The BOC has a ton of arrows in its quiver to boost money velocity. I wouldn't worry about it. Real estate will moon indefinitely.

[@geraldbrowne]

Do a lien search on new builds or plans in vancouver city hall permits . 😅It’s epic. Explain the quiver of tools except to try to control CAD devaluation. But you can’t keep buying your own junk bonds and putting off the reckoning day. That’s how Venezuela landed. BOC has used the interest rate tool, QE tool which they reversed. With the fiscal spending by JT Macklem has zero moves that won’t negatively affect economy. GDP is barely over 1% . No bond market bankrolls a stagflation economy without usury rates. If Macklem moves in June without FED watch the CAD decline into mid 60’s. Then watch the inflation rate move up.

[@ontariorob1400]

Good insight.

[@dreamingof777]

Only a crisis for a select few. Sounds like a opportunity for many.

[@c.s.4845]

So what your saying is there is a commercial lending crisis due to defaults and bankrupties in the commercial lending space and we are going to see some major bank failures. Inflation is up mortgages have just gone up more , not down like the government has said. They can not control inflation and interest rates are going to stay high, lot of people will not be able to refinance in the next 6-18 months.

[@mandrews1245]

That is exactly what will be happening! I went thru this in the 70's and so far this looks like it is going to be much much worse. This time there will be a housing crises, a market drop, a food shortage, high gas prices, higher energy prices, bank closures and inflation. All of this at the same time, while the gov't continues to restrict travel, censor media freedom and ushers in a CBDC. Let's just hope it doesn't turn into deflation.

[@Warrengraff-ym2yj]

That's how you know Vancouver real estate has been grossly overvalued for a long time. What serious investor would buy a property producing a few hundred dollars positive cashflow during "good times" (during a decade of historically low interest rates btw)? A few hundred dollars cashflow during dirt cheap rates... Think about that! It's a joke. It's all in hopes of speculation of higher prices, that's not how you buy a property for investment, that's disgustingly overvalued and it's not investing imo it's simply leveraged gambling. Canadian real estate is basically a game of hot potato fueled by massive debt which is encouraged by the collusion of banks and fishy government institutions like the CMHC. Oh and don't forget overseas black money looking for a place to park. How can any rational person say this is a healthy market, where the local industries can't afford to support their workers to live in the city where they work? The demand is all coming from newly created cash from debt, investor speculation and international black money. That's why I call Vancouver a fake city, it's not a city built on a solid foundation of a real economy or a natural community.

[@citizenprotection]

But can’t you just put a renter in and they pay your mortgage down? You are building equity with your property. 20 years you have a cash flow property. Do that 5-6 times and you are set either you can sell your paid off condo or keep collecting rent. Please let me know your thoughts.

[@DJRS2178]

That's because they aren't investors, they don't know anything, they just got lucky or heard others doing it and bought the top of the cycle. Notice how the narrative was immigration and supply shortage? Well the immigration topic is over and now people are seeing inventory go up. All cycles collapse no matter what people say. Time is undefeated.

[@RainCity3rd]

@@citizenprotection people were willing to do it because the last nearly 30 years it generally worked. More and more people saw and heard people making easy money. Of course we only hear about the good examples not the ones that dont go well. And even with the good examples we only hear the positives as in i made x in x number of years no one mentioned all the costs. It would be like taking to a coffee shop owner and only hearing about the revenue side of the business. We had ever greedier and more ignorant amateurs jumping in that just kept the entire scheme going. Those who got in made tons. Even getting in 2017 peaks. But eventually someone is going to be caught out when things go the other way. Nothing can go up forever, its just super hard to predict when to get out. What we dont want to have happen is everyone realize at the same time this is a terrible investment, we need people to slowly realize and sell over time. Real estate has only one real positive quality and that is easy leverage. Otherwise it is liquid, very expensive to hold, to transact and very expensive so stuck not being very diversified. it is also taxed unfavorably and now even more so.

[@ML-vk8ev]

Criminal money laundering capital of the world

[@oleksandrchopyk632]

Just food for thought. It would be interesting if you explored the impact of union labor. Wondering how come nobody is talking about an average of 30% increase. Workers don't see those gains. Then where does it go? 😂

[@dontmissaday]

its a bubble

[@jinxytulip4808]

Raise the rates

[@CJ-le6pe]

Investors shifting to AB. CGY specifically. Mkt on 🔥

[@MustyBastard]

In Edmonton finally after 12 years my house is actually worth more than I paid for it ~~

[@m.b5777]

The political cost of not increasing housing supply is massive. The government will fund rental buildings themselves with cheap financing . They will increase the housing supply one way or the other And immigration will be capped for the foreseeable future.

[@h.a.sparky984]

Steve should be the houding minster, when pierre is pm.

[@thebigdumbmac]

lol I was telling all my friends during 2008 that Ty would be stupid to buy a property because prices have to crash……most of them are millionaires now. But at least maybe I was right. Should have bought back then…..still kicking myself. Never made a good financial decision in my life!

[@Observer168]

You’re not the only one…. Tons are priced out because they thought things would crash

[@averageperson2177]

Time to start making better financial decisions; you can do it. the more you do it; the more chances some decisions will pay out over time.

[@lamcnulty6640]

Time horizons for investors and buyers must shift. There continues to be imminent pain and one should prepare for rates being higher for longer and perhaps even a US recession in the next two years. We're seeing $2 mil half duplexes in the Mount Pleasant/Riley Park move quickly. Wondering what you think of this asset class given, as you say, the single family home above $2 mil plus renos continues to squeeze out all but the very high net worth individuals. Should families scale down. Europeans have been doing it forever.

[@luckycharm8888]

Its about time homes are treated as shelters for families, homes are not investment that can be treated like stock commodities! Its about to time to have a market correction and if there will be a crashed then let it be, home prices that is mortgages needs to reflect its real value based on average worker living in the community that will be able to pay base on percentage of their income that they can afford!

[@averageperson2177]

That isn’t reality and won’t ever be for desirable areas where the demand heavily outweighs the supply. Even Edmonton is about to leave that affordable reality within the decade.

[@Blakpepa]

The only way this market will correct it self is if the interest rate keeps going up and construction is limited to purpose built rentals. The BoC should be steady raising these rates instead if playing these games. The government also needs to do what other countries do which is ban foreign home ownership and development. In the GTA single family homes are just going up and condos remain a joke with these sky rocketing maintenance fees

[@frankpeng2448]

That's what you get when you have a premier who thinks the supplier of housing are criminals. Now we have investors shying away, developers going broke and potential landlords are pulling out of the rental market due to over regulation. The housing supply is stalling, shrinking in some area and not growing but demand keeps rising. The real estate price will continue to go higher and rent will keep going higher. Simple economics. Supply and demand.

[@mikesmith-nj1ij]

Let's punish home builders even more by increasing the capital gains tax. I learned to watch what people do, not listen to what they say. It's hard not to conclude that the federal government wants less housing, not more.... Because every action they take eliminates incentives!

[@AshrafulAlam-zw1xw]

It's not simple like that. There is more than supply demand issues. RE market in Canada is a spongy scam. Do you know who controls it?

[@sean4060]

I don’t see how rent can go up if less and less people want to be landlords. Who wants to be a landlord these days. We essentially have no property rights anymore in practice. In theory we do but in practice, we don’t. I’m ready to slowly liquidate my assets here and move to the USA. Definitely to a red state. Probably Florida.

[@DJRS2178]

Completely backwards. Demand is going down, if it wasn't, prices would be going up with the current "low supply". There is no shortage of housing. We are at peak cranes in the sky. Look around, developments everywhere. 0% rates had investors/speculators buying up the supply in previous years all the way to the top of the cycle in 2021. Then came the airbnb craze, more supply bought up during covid. Then they raised rates at the fastest rate in history. This signaled the top. Now you wait and watch as those that are over their heads in debt decide to unload second and third properties. Supply is already increasing. Sales volume decreasing. The gov is also changing short term rental rules, so those that thought they had a new business in airbnb have to sell their units because they can't afford them without the premiums airbnb offers. Rates are remaining high as people are squeezed for longer. We haven't even seen much for job loss yet. When that begins, combined with higher interest rates, higher taxes and inflation we will see some people be forced sellers of their home they can no longer afford.

[@DJRS2178]

@@sean4060 inventory in Florida is sky rocketing, so you will have lots to choose from, but you better research the surge in insurance premiums...

[@ethimself5064]

I though Landlords could apply for special exemptions for raising rents in BC

[@glengarbera7367]

A large portion of the Canadian public was led into believing real estate was a easy way to make money. The government encouraged this by keeping interest rates artificially low for decades, fostering the belief that home prices never go down. As someone who saw his parents' real estate empire collapse in the 1980s and 1990s, I knew these hard times would come back. I was thinking our housing market would collapse in 2009 as it did in 🇺🇸. Thank god I was talked out of selling by my 2 children who didn't want to move to a different school.

[@Observer168]

Prices have tripled since 2009

[@glengarbera7367]

@Observer168 and I was going to sell and rent in 2009 until prices dropped. Thank god my 2 kids, 9 and 7, were smarter than me.

[@001sander2]

Investors were actually resellers. The ensuing asset inflation has crushed labour and productivity.

[@alwaysthinking2175]

if the debt market is bad, the equity market is worse.

[@CoconutPatel]

Fold like a cheap lawn chair 👌🏼🤣 love it. I think you're right Steve.

[@AndreInThe416]

Need experienced people to comment. Went into a condo building when parking lot was 80%+ empty few years ago. That's a red flag. You think many people don't know it? Prices will reset.

[@martinrev8487]

Finally! My doom predictions (based on Austrian economic theory that was inevitable with a lag) that Steve could not believe in 2021 are coming to be. It's gonna get beyond ugly. Get more gold, Steve. Nothing else is safe.

[@segasys1339]

lol

[@sedchff123]

Bitcoin

[@segasys1339]

source?@@sedchff123

[@Observer168]

You could end up waiting another 10 years for a crash.

[@robertwaldner3470]

Gold and silver is always good to have

[@JohnSchuetz-js7lk]

Hard to believe so many are leveraged.

[@Joe-mz6dc]

No it's not. Look how many took the safe and effective and still can't figure out they got duped. Take a look around you man.

[@geraldbrowne]

Steve is right on about the cleansing

[@segasys1339]

Please bro there will be no cleanse. Some way somehow the feds will keep pumping housing.

[@marekzmazur2077]

i’m wondering do the numbers in fact not make sense anymore or are developers just used to making certain margins and they can’t make those margins anymore so they don’t build?

[@antonburdin9756]

Arbitrary immigration targets are simultaneously increasing demand and suppressing wage growth. There are better ways to control immigration. I would suggest demand based approach with some guard rails in place. For instance, I would require all educational institutions to provide housing for international student (at least 50%). Businesses should be required to provide accommodation to all temporary/seasonal workers on top of the minimum wage. In order to hire foreigners employers should be required to prove that they are paying enough to afford housing in the region (market cost of accommodation is less than 30% of salary). Accommodation for refugees should be secured before bringing them to the country from around the globe. No accommodation = no permits. It would limit demand and prevent wage suppression.

[@g-wagonsg-wagon3693]

They get free housing in hotels and free cell phones and a government monthly wage they don't need a job we pay for them and they laugh at us going to work in the morning

[@rosemagazine]

one company defaults can pull 10 other companies to that level of default.

[@martinrev8487]

Very underrated comment. I'd upvote this 100 times if I could.

[@Peter-sz1sn]

Great analysis, as always!

[@mrriesen9004]

So basically the market on the Left Coast can't sustain itself when investors have to pay for the money they borrow, pity.

[@Observer168]

Why aren’t people looking in Winnipeg? Brand new town homes for under 500k $394,900 1288 Fernbank Avenue Winnipeg, Manitoba R2V5E4

[@mandrews1245]

Why? Because of the limited job market. Also the Millennials and Gen X's don't think of Winnipeg as a "happening" place. In fact, they think of it as boring.

[@Observer168]

@@mandrews1245 it’s great for people that want a more slow paced lifestyle. It’s also a easy way to own a home

[@chriswiens9706]

I think we've hit the ceiling in terms of prices for condos/townhouses/etc. There is NO WAY that prices can keep going up. People cannot afford it.

[@Observer168]

That’s like saying there’s no way the value of money can go any lower.

[@chriswiens9706]

@@Observer168 Good point but even with the state of any country/inflation things can change. Our Canadian dollar is going to decrease in value compared to the USD. So yes, the value of our money can actually decrease.