The Decline of Vancouver.

Its going to take a generation for prices to normalize. Interest rates have begun their long steady grind upwards which could take a decade. Add in people locking in mortgages for 5 years at a time, the current crop of people locked out of the housing market due to these stupid prices are in purgatory.

Those that didn't sell 6 months ago missed out on a lottery. But i get it, its a hassle to sell and cash out then have to find a new place and deal with the unknowns.

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WTF! we dont need more measures to access cheap money! What a contradiction - force people to qualify at higher rates limiting the amount you can borrow, and then now this - helping poor people who cant save enough for a down payment to get in the market.

And us the taxpayer is flipping the bill for the interest free loan. Unbelievably stupid.

this^^^

http://www.cbc.ca/news/canada/british-columbia/interest-free-home-loans-bc-1.3897832

the problem has been a combo of no control on foreign ownership and the banks/gov fucking with the lending rules and this is just more fucking with the lending rules

we still haven't sold moms condo … I think a new price is in order

helping poor people who cant save enough for a down payment to get in the market.

Household combined income of under $150k isn't exactly "poor" people - that means buddy making 6 figures with a stay at home wife who blew all his money on truck and toy payments for the past bunch of years can now get my taxpayer dollars to help him out of a completely foreseeable housing crisis.

Also, must be a BC resident for 1 year… (so all the albertans who fled their precious oil market and moved to BC when it shit the bed can qualify to borrow taxpayer money here actually making it less affordable for long time residents of communities across the province).

This doesn't really help the poor out - yes, the poorer demographic might qualify to borrow the 5% or $37.5k for a down payment, but without a good paying job will likely not qualify for an actual mortgage. I know this because I don't have a particularly high income and qualifying for a regular mortgage was difficult so I had to learn to be better with money, scrimp and save for years to come up with a 20% down payment to get out of regular CMHC requirement. 35% actually, because I bought raw land but that was my own choice really.

I'll just pretend I quoted all today's post and say ^^^this x1000.

Free money? I thought money was virtually free at 2.35%, but at zero % it really is free. In fact unless we have deflation, they are paying you to take their money. But only to those who want to buy into a bubble. This is going to end in tears. But when, I don't know. So many cans getting kicked down the road, it's impossible to know where it will end.

House is for sale. Looks like I'm going to get an offer written on it after client gets back from Xmas break according to the realtor. I'll believe it when I see it, but really, what do you do next? Stocks are at all time highs for no good reason, so won't be putting it there. Rents are at all time highs, so if the can keeps getting kicked for another 3 years, there's $75K in rent gone while waiting for a correction. If it takes another 5 years that's $150K in rent for a townhouse around here. Unless you own actual physical gold, you may lose it in a financial crisis, and you can't sell large quantities of physical without melting it down first. GIC's are negative accounting for inflation. It's no wonder people are piling into stocks and real estate as there's nowhere else to protect your wealth, but at some point both are going to crater. 1 year? 5 years? If it takes 5 years, it could go up another 40%, and then just reverse 30% and you just lost $150K in rent during that period for no good reason. Same theory for stocks. Stay out and wait for the correction that doesn't come until dow 25,000 and it goes back to 21,000.

I strongly believe that shit's going to get ugly at some point, but I still wonder if buying a townhouse instead of renting may be the best choice if I manage to sell the house. This makes me think that the majority of people who don't think it's going to get ugly will think buying a TH is the best choice especially with free money. Ok, stream of consciousness typing has revealed… buy a townhouse; they are about to go up, up, up. To the moon, baby!

From CBC today. Oh the ironing…

Why would the government give out loans for down payments? Isn't the fundamental point of a down payment to prove (to yourself, and to the bank) that you will be able to pay your mortgage?

Why? So the government can throw your hard-earned tax dollars at developers while exploiting the riskiest, sketchiest class of homebuyers after whom you will eventually have to pick up the cost of default.

I thot the DP was so the lender could see you have some skin in the game and are capable of having skin in a game?

when it was minimum 10% down 25yr amortization I thot that was pretty good

I think low/no money down and 40yr amortization was bad for the order of things

having said that I did get the longest amortization (30 or 35?) I could get 6 yrs ago

Why would the government give out loans for down payments? Isn't the fundamental point of a down payment to prove (to yourself, and to the bank) that you will be able to pay your mortgage?

They would be better off copying Fannie Mae / Freddie Mac.

Incredible!

Give people five years of interest free loan that they can start making payments on right at the time they'll be due for a renewal.

At least there will be more AirBNB listings on the market now…

It's been fucked up since 2009. Rode my bike past this fenced in area a while ago and wondered what was up.

http://www.cknw.com/2016/07/26/little-mountain-rezoning-approved-after-nearly-a-decade/

Seems like we aren't the only people who think the down-payment loan policy from the government is a terrible idea: http://globalnews.ca/news/3130685/terrible-policy-b-c-housing-incentives-widely-panned-by-experts/

An election is coming up, and the BC Liberals are in full-on slime mode.

The program will benefit some first-time homebuyers who would not otherwise be able to afford a down payment, the economists said. But much of the benefit will flow directly from taxpayers to the real estate industry and people who already own property. The Urban Development Institute, a developer lobby group, is an enthusiastic supporter of the policy.

http://www.metronews.ca/news/vancouver/2016/12/15/bcs-interest-free-loan-to-homebuyers-offers-much-risk-few-reward.html

This whole interest free, payment free loan for five years sounds really bad. Like Sub-prime lending in the USA bad.

What is the interest rate the BC Libs charge after the five year grace period? What's the five year mortgage rate right now?

How many more eggs can we fit in this basket? Oh I forgot LNG will be a provincial windfall when it's up and running in 2018…

I would think most would roll it into their mortgage at the first renewal.

its nice to know that banks think of those of us who cant afford mortgages in the LM as "bottom of the barrel, and lousy risk"…

cant say im surprized those, banks have always been for people who have money not those that actualy you know need to borrow…