patrick.net

This all appear pretty stupid when it crumbles. Oh well, keep pushing it higher for empty condos.

I'm just shocked that nearly 30% of a popular section of the city can be completely devoid of residents. Wouldn't people notice the lack of people around?

I'm guessing even the criminals are funneling their illicit gains into Vancouver housing.

I was just there this weekend for a day visit. A lot of the day was spent in the darker blue waterfront areas since there are nice parks and shopping.

Observations:
- Very heavy Chinese presence, as in the SFBA feels like white-people-central in comparison.
- A lot of wealthy 20-something Asians. They are obviously FROM Asia based on their attire and demeanor (not an attempt to disparage anyone, just a basic observation). The giveaway is usually the "designer attire from head to toe" thing, and the ridiculous number of new Mercedes cruising the streets.
- Lots of vacant condos based on how many had lights on at night. Somewhere between 1 in 4 and 1 in 10 were dark at night depending on the area. Obviously people could be out doing stuff, but it seemed like a lot of dark units. NOWHERE near the level I see when I am in China, but it was noticeable.
- Tons of properties for sale, and prices are more than enough to make the SFBA seem like a good deal.
- Good Asian food.
- Beautiful mountains and water all around, assuming that you get sufficiently far out of the downtown area to actually see it.
- TONS of condo high-rise construction going on. There were some RE agencies with kiosks in the malls so we stopped to talk to some agents for fun. We were told that most of these new condos are sold before ground is broken. "Suitcases full of cash" is an everyday occurrence there. This is from a RE agent that thought that we were actually interested in buying up there though, so who knows what the truth is.
- Local natives have a growing dislike for the growing new-money demographic that is flooding out of mainland China. It is bringing cultural shifts ("your value as a human being is directly proportional to how much money you have") that are very contrary to what people are used to there, and mainly, makes Vancouver impossible to afford to live in for people that actually have to work for a living.
- It's basically turning into a money laundering vacation resort for wealthy Chinese that sense the instability over in the homeland and are desperate to get their money out while they still can.

As far as I can tell, the SFBA is "on sale" and is in the early stages of getting hit with the same thing that Vancouver is experiencing. "Hot money" or "dumb money" or whatever you want to call it wants OUT of Asia and into somewhere else where the government can't get at it. It seems insane to us normal American folks, but it's hard to put a price on escaping political instability and protecting your assets from a government that can walk in, take all of your shit, execute you and send your family the bill for the bullet. To the wealthy over there, the prospect of losing even half of their money on a bad RE bet in America or Canada beats the hell out of losing everything if the government there decides that they don't like how they got their wealth. Besides, the west's insatiable consumer lust for baubles moved $trillions over there, and now they are going to buy us out of our homes (the ones worth living in anyway). If you want to point a finger at someone, find a mirror. That's the reality, sadly.

RE: BMWman91; Well for a 1 day visit, I am impressed with the accuracy of your observations. I lived there for 6 years (2005-2011). It is an awesome place to live and loved the heck out of it but now certifiably the most expensive city in North America. Much of what you say about the Chinese immigrant is true. Basically, if you have the funds, you can buy your way into the country. BTW, You can do much the same in the USA but the entry fee is higher.

The rich Chinese, and there are plenty of them, are pouring their cash into Canada for mainly the reason you point out....a get out of jail free card if you will in case things go south in China. They move their wives and children over to be educated in an awesome school system and so that their kids learn English with no discernible accent. They obtain citizenship and live happily ever after, all the while avoiding any income taxes as dad stays in China earning billions while the Mrs. sits at home or goes shopping. Of course, this is a generalization and have met many hard working Chinese immigrants but the stereotype holds true for many.

I believe the hood you are describing as being mostly dark at night is Coal Harbor. Extremely expensive but actually I chose not to live in this hood because like you said, it is largely devoid of life. I lived on False Creek, near the Yaletown area which is much more lively. Even so, per the occupancy map at the link, my hood was rated at 18.5% empty.

I lived in a new building and it was rather upper end. I sometimes felt like I was the only 'working stiff' residing in the building. Case in point; There were 5 units per floor. On my floor, the owners profile is as follows: Condo 1: One couple were from Iran. They did not work. They would come into town about 3 times a year, and generally only stayed for about a month each visit. Condo 2: This couple were Canadian from northern BC. They owned a metals mine. They purchased the condo so that they would have a place to stay when in town for Vancouver Canucks games. So in town for the good games, otherwise, never saw them. Condo 3: Canadian PhD Psychologist. In town every other month for a weekend to visit her mother. Condo 4: Rich Iranians who purchased their condo for their 19 year old son who went to UBC. Rarely home. Condo 5: Me. Worked my ass off. LOL. So you see, our floor was basically empty. Little wear and tear on the building as I looked at it and extremely quiet. For some reason the Chinese did not like our building. It was right on the water with spectacular views.

Anyways, in spite of the city being very expensive, I LOVED THE PLACE and miss it terribly. But in the end, I wanted to move back into a single family house. My search was futile. To buy a home worth living in would have taken upwards of 2M. I made a good salary in Van, much more than average, but even so, I simply could not compete with all the foreign cash pouring into the city. Russian, Iranian, Chinese and American were the predominant waves of rich immigrant waves that I noticed in my hood.

Anyways, decided for my career, and my desire for a SFH to relocate to the SF Bay area. Yes, SF is cheap in comparison. Even so, the tide has turned, and the market in YVR is now in decline. Perhaps for different reasons than the US down turn, but the market is going south none the less. Will people see the similarities of the US and start heading for the exits? I would and did. But like most humans, most will probably think that the down turn is simply a blip in the market. Of course, I have no crystal ball and perhaps it is just that, a speed bump, but my gut tells me that Van is in store for a substantial correction.

Cheers, and hope you enjoyed your day visit in Vancouver!

Ray Charles could've saw this coming.

bmwman91 says

- It's basically turning into a money laundering vacation resort for wealthy Chinese that sense the instability over in the homeland and are desperate to get their money out while they still can.

a way for illegally smuggled currency put offshore without the need to trigger bank investigations and regulations.

bmwman91 says

The real kicker here is that the US can't deny wealthy foreigners the ability to buy RE.

Of course you can, it as the practice of US DEA and IRS to confiscate foreign owned US property from the South Americans who have been found dealing in the narcotics trade.

Smuggled currency from Asia is no different.

BEIJING—China welcomed a Canadian court's decision to extradite Lai Changxing, the nation's most-wanted fugitive, even as lawyers and rights activists expressed doubt that he would get a fair trial in his homeland for his alleged role in a multibillion dollar smuggling operation.

Canada's Federal Court on Thursday upheld the deportation of Mr. Lai— who has been fighting extradition from the country for 12 years—calling him a "common criminal," and dismissing his argument that he could be tortured or executed once he arrived back in China, according to the Associated Press.

Read that again... MULTIBILLION !!

Let me rephrase...
The US could enact a law that bars foreigners from buying RE entirely. They won't because the US Dollar has to look like it is actually worth something in order to retain its reserve currency status. If the US refused to let foreigners buy RE here, after paying them piles and piles of Dollars for their industries' goods, it would probably start to trigger doubt in the value of the US Dollar.

bmwman91 says

They won't because the US Dollar has to look like it is actually worth something in order to retain its reserve currency status.

they are however welcomed to buying our products and services ...
should help our exports. it would be the same to retain it as reserve currency status.

The areas where I would expect the most "density" seem to have the most empty condos.

I won't predict the future of the market there, but I could see a big correction.

Goran_K says

I'm just shocked that nearly 30% of a popular section of the city can be completely devoid of residents. Wouldn't people notice the lack of people around?

you obviously dont see the contradiction in your statement here.

it's POPULAR and UNINHABITED????

The Original Bankster says

you obviously dont see the contradiction in your statement here.

it's POPULAR and UNINHABITED????

Well, I meant popular as in it's Waterfront property with lots of commercial shopping, amenities close by, and you can rarely find properties on the market that aren't in the 7 digit range.

But according to the data, 10 to 25% of the condos are empty.

I don't know any cities that fit into that mold.

Goran_K says

The Original Bankster says

you obviously dont see the contradiction in your statement here.

it's POPULAR and UNINHABITED????

Well, I meant popular as in it's Waterfront property with lots of commercial shopping, amenities close by, and you can rarely find properties on the market that aren't in the 7 digit range.

But according to the data, 10 to 25% of the condos are empty.

I don't know any cities that fit into that mold.

Yeah, that is the way I read it.

The demand for living in Vancouver could easily fill the city several times over...only if the people could actually afford to live there.

Exactly. That's this researcher's point. So many people want to live in the city, and actually pay taxes, and become full-time residents.

But it seems like large portions of the city are turning into 2nd or 3rd homes for wealthy tourist who want to launder money, or just have a place to stay when they visit 2-3 times a year.

Is this a bad thing? What are the effects? I'm sort of interested in the answer myself.

he means DESIRABLE not POPULAR.

Okay Grammar Queen. Can we get back on topic?

problem is if the prices drop to below a certain level, it will invite in people that would make the neighborhood image into something that some perceive as undesirable. It's no longer white, elite, education, monied, etc. Second that happens then the actual white elite leave the area, further bringing down prices and prestige. Detroit once had some very nice white elite areas that are today completely abandoned.

The Original Bankster says

he means DESIRABLE non POPULAR.

These terms are not mutually exclusive, and both apply to Vancouver.

But the price rises in Vancouver aren't being driven by whites. By all accounts it's foreign money (from Asia) that is driving prices.

The Original Bankster says

problem is if the prices drop to below a certain level, it will invite in people that would make the neighborhood image into something that some perceive as undesirable. It's no longer white, elite, education, monied, etc. Second that happens then the actual white elite leave the area, further bringing down prices and prestige. Detroit once had some very nice white elite areas that are today completely abandoned.

Totally true, but I think that a "better" balance can could be struck between the price and demand that would not result in such a high vacancy rate, but would also still be expensive enough to keep out the "undesirables."

I always favor long term trends over short term trends. Vancouver is due for a correction.

robertoaribas says

Goran_K says

I always favor long term trends over short term trends. Vancouver is due for a correction.

to hell with a correction, I want vancouver to plummet so far in price, i can sell one of my cheap properties in phoenix, and buy 2 there! ok, I will settle for one there! I think I'd love living in vancouver for a while...

they have these funny grey things in the sky that block out the sun most of the time, and these wierd round little things that fall and make your head wet, but I think I could get used to it!

chemtrails?

robertoaribas says

to hell with a correction, I want vancouver to plummet so far in price, i can sell one of my cheap properties in phoenix, and buy 2 there! ok, I will settle for one there! I think I'd love living in vancouver for a while...

they have these funny grey things in the sky that block out the sun most of the time, and these wierd round little things that fall and make your head wet, but I think I could get used to it!

Roberto, you'd give up the sunny desert for rain clouds, and misty foggy mornings?

Ok.. so let's say I think Canada's home prices (particularly Vancouver) are finally going to stop dropping? What's the smart money play here?

short Canadian REITs? BEI?
lenders? HCG?

See I can't live in extreme places like the Pacific Northwest, or the Desert.

I need to live in a place where I can access each of those in very little time, but for the most part, I prefer 70s - 80s, Sunny, 90% of the time.

I do like good beer, and chinese food though.