Real Estate: More Naive’ Buyers ” Greater Fools “
Spot The Speculators #88 – “My girlfriend and I just put an offer on a condo by Gilmore station for 430K. It looks like we’re going to get it. We plan for this condo to be both an investment and a home for at least the next 7 years.”
“I graduated last year and got a stable government job and my gf is a chef. We’ve saved up about 50K for downpayment, and we just put an offer on a condo by Gilmore station for 430K. It looks like we’re going to get it. We plan for this condo to be both an investment and a home for at least the next 7 years.
We both grew up in Richmond, and as much as we love the place, there are inherent issues with the city. Most importantly, its housing market is based on one factor – Chinese investors.
The housing market in Vancouver is strongly influenced by investors from overseas, mainly China, Hong Kong, Taiwan. Earlier this year, policies were tightened for foreign investors, in most cases from China. Money was actually returned to them. This means that the development on River Road in Richmond by the Olympic Oval is undersold. Now housing prices are dropping like crazy in Richmond after a 5 year boom, not to mention the crawling speed of the market as well.
My company will be moving next to Brentwood mall soon, and this is one of the reason why we’ve decided to move there.
More importantly, the plan to develop and rebuild and revamp Brentwood mall is a good sign, including the three phase project – the first of which includes an ultra high rise. Needless to say, with an increase in population in the area, housing prices are expected to go up in the future.
We almost bought a similar place for 20K more last month, I’m so glad we didn’t because the prices has dropped a little. But there are not a lot of options because sellers who are not in rush simply took their property off the market.
Here are the questions I have:
Is it possible that there will be too much property for sale that dilutes the value of property as a whole in the future? For example, both Brentwood and Oakridge malls have plans for a ton of new homes in the future (both 3 stage projects).
What are other factors that might affect property value in Burnaby and in Greater Vancouver as a whole?
Finally, I’ve heard that housing in Vancouver, as long as it is close to Downtown, UBC, or Vancouver itself, will always be saturated. Can this always remain true if there is such an abundance of developers creating new condos?
Everything considered – what do you expect a 400k-ish condo in Burnaby to be worth on the market in 5-10 years?”
OMG….do some people have shit- for -brains ?
If so..where’s the lever so I can invoke ” fluussssshhhhh “
There is a saying re: the Rich..ie ” If you have to ask the price…. you can’t afford it” (?!?)
For the rest of us….there is a saying..” If you watch the pennies…..the dollars take care of themselves .”
” My company will be moving next to Brentwood mall soon, and this is one of the reason why we’ve decided to move there “.
SUGGESTION: Do some critical thinking…..do a LOT of homework…….envision some simple models. Why does this person ” feel pressure “…..where is the pressure if a balloon is deflating..there is concurrentlyy a vacuum on the inside and a strongwind on the outside…eventually an equilibrium …a balance will be achieved…..one that reflects TRUE market forces……aka “supply and demand” …… without artificial economic steroids.
Yes ..Richmond is/was very popular with Asian investors. This creates a ripple effect elsewhere. I recall in the early 1990’s an anomalistic swing..that Coquitlam prices were greater than Richmond comparables due to fears of Richmond prices. However, the author of this article above seems to assume(ass -u-me) Brentwood area Burnaby is not attached to Richmond price dynamics ?
Simple answer ? It ‘s a M-E-S-S everywhere…..no place on earth is immune. Why do people swallow the Kool-Aid so readily……they do a reasonable analysis of Richmond market….but then Fail re: the Burnaby market.
This party seems to be a fence sitter…..and at fragile tipping point whereby they could be swayed one way ……or the other. (nobody sneeze!!!)
There are numerous BLOGS out there that provide 100% FREE analysis / comments by a huge spectrum of people. Assume a worse case scenario….ie interests rates rise (one of the biggest dangers), one of them loses their jobs….what is the exit strategy etc. IF I was pursuing a condo purchase(the very thought gives me a cold sweat) I would get a more established one with a non dysfunctioanl strata council…new buildings have been speculated on…many absentee owners….do they allow proxy voting…are many of them about to go bankrupt…I just foresee a major downside in this class of condos. Decisions like this, if one guesses “wrong”, can literally ruin your life.
Conclusion: The party above is asking a lot of questions…..which is good on the one hand, but on the other they appear to have made up their mind and treading water . They appear fearful and confused (BAD)…and the only way to remedy that is to stay out of the market…do more research…then you will feel prepared and empowered to make the “right move”.