The marginal home buyer can’t muster much of a bid these days, and who could blame him? When is this going to start hitting the balance sheets of lenders?
Vancouver home sales activity fell again in May as buyers continued to sit on the sidelines, the city’s real estate board said Tuesday.
Residential sales in the region totalled 2,228 last month, an 18.5 per cent drop from the same month a year earlier, Greater Vancouver Realtors said. Sales levels are 30.5 per cent below the 10-year seasonal average.
I don’t know if it’s related, but Costco in Ancaster was empty today at 5:30pm. No waiting in line at the checkout like we’re used to.
Houses, nobody is going to reduce their price unless it’s a forced sale. Most home owners -can’t- reduce price, they’ll go broke. But if nothing is bought because nobody can get a mortgage, and nothing sells because nobody has $1.2 million cash…
I keep track of my little town’s zoning administrator hearings, design review hearings and planning commission hearings. These dockets are usually filled with all sizes of residential projects. In the last year, I have seen more hearings canceled for lack of items more than ever in my 35 year experience with the city. The average resident of my high-end upper, upper, middle class community is tapped out. Gasoline prices > $5.00/gal. Multiple utility increases, sales tax increases, property tax increases, high interest rates, etc. Everyone is pinching pennies.
The only projects being processed are several massive 7-story tall multi family apartment buildings. Why? Because State Law now forbids the city to enforce height limits, or require traffic studies or anything. The State now dictates how overloaded a tiny town’s infrastructure gets. Hint, there are few structures in town >2-story. Yeah the visual impact will essentially destroy the town.
But none of those projects can get funding … unless it’s coming from ChiCom or Cartel oligarchs looking to launder some money. So, most likely these applicants are simply mining entitlements, hoping to bid up the price of otherwise mediocre properties.
So much for the State expanding the number of housing units.
Going to hit the income statements first, it’s the accountant in me, can’t help it. Loans to developers have skyrocketed in the last two years, and they are going sour at an increasing rate. The loan loss provisions in the latest quarter of bank earnings were way understated, I think the BoC may already be taking measures to protect the big banks, aka, Laurentian Elite.