Real Estate at a standstill

Social, economic and environmental issues in our ever-changing world.
User avatar
cv23
Guru
Posts: 8827
Joined: Jul 4th, 2005, 2:59 pm

Re: Real Estate at a standstill

Post by cv23 »

wrote: This is not about asking for anything to be addressed; only about accepting the "fact" that by accepted and traditional measures of housing affordability, Kelowna (and Penticton) are not considered affordable.
New times require new methods and new measures or we will just continue down the "traditional" road.
wrote: I agree that skewing of the data is inevitably worse here due to a large number of retirees and other high net worth individuals; however I don't believe this would change the data drastically to the point of making housing affordable by these measures. The majority of retirees are not rich, though some are and most people in town are also not rich and survive on their incomes.
And as has been previously pointed out drawing conclusions, forming beliefs, based on skewed or manipulated numbers is not something that should be done.
wrote: And I have to point out that there is ample other evidence of unaffordability that you don't need a calculator to see. I personally know many, many families stretched to the breaking point by housing costs, many, many people just scraping by and many more living it up off of home equity and not from their income.
As can many examples of families having excessive disposable income because of housing costs, many many people prospering and many more living off their income and not home equity. There are two sides to every coin and clearly some want to only see the negative without realizing/admitting there has to be a positive for there to be a negative.

wrote: Some suggestions here that lower income people (and this is probably half the people) should just move and the expectation that this void would just be filled by other rich people neglects to consider what the community would look like if that actually happened. Who will keep all the services running, unplug their toilets, sell them groceries and do all the other things rich people expect to be done for them?
And should the lower income expect the "rich" to give them money or should they do like most of the "rich" people did to get where they are work to amass wealth? Lots of things in life today revolve around supply and demand and both housing and services fall into that category. As supply drops prices increase until supply increases to meet demand and a balance forms or until supply exceeds demand and prices fall. The demand, and resulting prices, for housing and services will remain high in Kelowna as it is/was considered as a desirable place to live. There is no question the prices for everything in Kelowna, including services has increased and will continue to do so as long as demand exceeds supply. Sure people can move to where housing is cheaper but that is because the location is less desirable so less demand and those people will find that the wages are commensurate with the reduced demand. They will not be any further ahead just trapped at the same level in a worse location by their own lack of ambition or dedication to better themselves and there financial position.
DoDo1975
Generalissimo Postalot
Posts: 908
Joined: Apr 20th, 2006, 9:50 pm

Re: Real Estate at a standstill

Post by DoDo1975 »

cv23 wrote: Sep 22nd, 2022, 2:24 pm
wrote: This is not about asking for anything to be addressed; only about accepting the "fact" that by accepted and traditional measures of housing affordability, Kelowna (and Penticton) are not considered affordable.
New times require new methods and new measures or we will just continue down the "traditional" road.
wrote: I agree that skewing of the data is inevitably worse here due to a large number of retirees and other high net worth individuals; however I don't believe this would change the data drastically to the point of making housing affordable by these measures. The majority of retirees are not rich, though some are and most people in town are also not rich and survive on their incomes.
And as has been previously pointed out drawing conclusions, forming beliefs, based on skewed or manipulated numbers is not something that should be done.
wrote: And I have to point out that there is ample other evidence of unaffordability that you don't need a calculator to see. I personally know many, many families stretched to the breaking point by housing costs, many, many people just scraping by and many more living it up off of home equity and not from their income.
As can many examples of families having excessive disposable income because of housing costs, many many people prospering and many more living off their income and not home equity. There are two sides to every coin.

wrote: Some suggestions here that lower income people (and this is probably half the people) should just move and the expectation that this void would just be filled by other rich people neglects to consider what the community would look like if that actually happened. Who will keep all the services running, unplug their toilets, sell them groceries and do all the other things rich people expect to be done for them?
And should the lower income expect the "rich" to give them money or should they do like most of the "rich" people did to get where they are work to amass wealth? Lots of things in life today revolve around supply and demand and both housing and services fall into that category. As supply drops prices increase until supply increases to meet demand and a balance forms or until supply exceeds demand and prices fall. The demand, and resulting prices, for housing and services will remain high in Kelowna as it is/was considered as a desirable place to live. There is no question the prices for everything in Kelowna, including services has increased and will continue to do so as long as demand exceeds supply. Sure people can move to where housing is cheaper but that is because the location is less desirable so less demand and those people will find that the wages are commensurate with the reduced demand. They will not be any further ahead just trapped at the same level in a worse location by their own lack of ambition or dedication to better themselves and there financial position.
Well as interest rates crank up and remain there we will really see how many of each category there is and whether the accepted and traditional methods of calculating affordability and applying it to a market while flawed, are still valid.

I wouldn't be betting on your side, but I have a real nice property that I would be willing to sell you at March 2022 prices if you are interested.
rustled
Buddha of the Board
Posts: 17570
Joined: Dec 26th, 2010, 12:47 pm

Re: Real Estate at a standstill

Post by rustled »

DoDo1975 wrote: Sep 22nd, 2022, 2:21 pm
rustled wrote: Sep 22nd, 2022, 1:58 pm This is nothing new, here. What's new is the need to talk about it as though it's something new.
Rustled, I have read your posts for a long time and usually agree with what you say and the way you say it; but here I think you are just plain wrong.

See the graphs I posted on page 51.
viewtopic.php?f=31&t=91426&p=3063997&hi ... h#p3063997

The green line represents affordability in Kelowna based on prevailing rates for the last 50 years.

I moved to Penticton in 1988 and have been in the valley off and on since then.

Note that when updated for the rate hikes of the last couple months, that green line would be above the purple line on the right.

This is most assuredly something new.
Thank you for your kindness. I may indeed be wrong. However, it seems to me this is only "new" if one insists on only looking at the Okanagan or, as your graphs represent, only Kelowna.

It seems to me this has most certainly happened elsewhere.

Again, when one lives where more people want to live, one benefits from living where more people want to live - and it costs more.
...do some internal evaluation; Are you aiming to tell the truth or just "win"? Are you aiming to inform or to promote a narrative? Have you checked your facts or are you just accepting what you are told? Ad Nausica
DoDo1975
Generalissimo Postalot
Posts: 908
Joined: Apr 20th, 2006, 9:50 pm

Re: Real Estate at a standstill

Post by DoDo1975 »

rustled wrote: Sep 22nd, 2022, 2:42 pm Thank you for your kindness. I may indeed be wrong. However, it seems to me this is only "new" if one insists on only looking at the Okanagan or, as your graphs represent, only Kelowna.

It seems to me this has most certainly happened elsewhere.

Again, when one lives where more people want to live, one benefits from living where more people want to live - and it costs more.
I am sure it has elsewhere over history. Monaco, Manhattan, London, San Francisco a bunch of others. Vancouver and Toronto are way worse; but arguably since we haven't seen a prolonged rate tightening cycle in 20+ years the question of whether or not the levels in those places are sustainable remains to be answered.

But again that doesn't change the fact that currently RE in Kelowna is considered by traditional and accepted methods and definitions to be unaffordable. That was the question that this tangent went off on; not whether it is sustainable (don't think it is); not whether the the definitions and methods have flaws (they do); not whether there are some valid reasons behind it (there are some); and not whether the government should do something about it (please don't bail it out).
rustled
Buddha of the Board
Posts: 17570
Joined: Dec 26th, 2010, 12:47 pm

Re: Real Estate at a standstill

Post by rustled »

DoDo1975 wrote: Sep 22nd, 2022, 3:05 pm
rustled wrote: Sep 22nd, 2022, 2:42 pm Thank you for your kindness. I may indeed be wrong. However, it seems to me this is only "new" if one insists on only looking at the Okanagan or, as your graphs represent, only Kelowna.

It seems to me this has most certainly happened elsewhere.

Again, when one lives where more people want to live, one benefits from living where more people want to live - and it costs more.
I am sure it has elsewhere over history. Monaco, Manhattan, London, San Francisco a bunch of others. Vancouver and Toronto are way worse; but arguably since we haven't seen a prolonged rate tightening cycle in 20+ years the question of whether or not the levels in those places are sustainable remains to be answered.

But again that doesn't change the fact that currently RE in Kelowna is considered by traditional and accepted methods and definitions to be unaffordable. That was the question that this tangent went off on; not whether it is sustainable (don't think it is); not whether the the definitions and methods have flaws (they do); not whether there are some valid reasons behind it (there are some); and not whether the government should do something about it (please don't bail it out).
The next question would be, what does it matter that it is considered by those definitions "unaffordable"?

It seems to me there's an intention behind labelling Kelowna real estate "unaffordable". What is labelling real estate in Kelowna "unaffordable" intended to accomplish? Does it, in fact, accomplish anything useful?

It seems to me it is intended as more than simply a statement of fact, e.g. "When we benefit from living somewhere more people want to live, it costs us more to live where more people want to live".

It seems to me the objective of applying the "unaffordable" label to Kelowna real estate is to help pave the way for an intervention of some sort.
...do some internal evaluation; Are you aiming to tell the truth or just "win"? Are you aiming to inform or to promote a narrative? Have you checked your facts or are you just accepting what you are told? Ad Nausica
User avatar
cv23
Guru
Posts: 8827
Joined: Jul 4th, 2005, 2:59 pm

Re: Real Estate at a standstill

Post by cv23 »

DoDo1975 wrote: Sep 22nd, 2022, 2:31 pm I wouldn't be betting on your side, but I have a real nice property that I would be willing to sell you at March 2022 prices if you are interested.
How about at March 2002 prices? How about at your purchase price? And no if why not?
One would think that someone so totally concerned about "affordability" would be only interested in a purchasers level of "affordability" not market prices in any way, or is it more about that everyone else should do as I say not as I do?
DoDo1975
Generalissimo Postalot
Posts: 908
Joined: Apr 20th, 2006, 9:50 pm

Re: Real Estate at a standstill

Post by DoDo1975 »

cv23 wrote: Sep 22nd, 2022, 3:18 pm
DoDo1975 wrote: Sep 22nd, 2022, 2:31 pm I wouldn't be betting on your side, but I have a real nice property that I would be willing to sell you at March 2022 prices if you are interested.
How about at March 2002 prices? How about at your purchase price? And no if why not?
One would think that someone so totally concerned about "affordability" would be only interested in a purchasers level of "affordability" not market prices in any way, or is it more about that everyone else should do as I say not as I do?
Are you attempting to imply that stating as fact that RE in Kelowna is considered unaffordable means that someone is a raging socialist? All the realtors will tell you the same thing, so will the economists and the banks. Are they all raging socialists?

RE is really unaffordable; that's not a good thing and I won't vote Trudeau, Singh or whomever the greens put up.

Did I just blow your mind.
User avatar
cv23
Guru
Posts: 8827
Joined: Jul 4th, 2005, 2:59 pm

Re: Real Estate at a standstill

Post by cv23 »

DoDo1975 wrote: Sep 22nd, 2022, 3:26 pm
cv23 wrote: Sep 22nd, 2022, 3:18 pm
How about at March 2002 prices? How about at your purchase price? And no if why not?
One would think that someone so totally concerned about "affordability" would be only interested in a purchasers level of "affordability" not market prices in any way, or is it more about that everyone else should do as I say not as I do?
Are you attempting to imply that stating as fact that RE in Kelowna is considered unaffordable means that someone is a raging socialist? All the realtors will tell you the same thing, so will the economists and the banks. Are they all raging socialists?

RE is really unaffordable; that's not a good thing and I won't vote Trudeau, Singh or whomever the greens put up.

Did I just blow your mind.
So I take that is a "no" to the sale and no explanation is necessary as the complete deflection says it all.

Here we are right back hearing the same old song that "RE is unaffordable" because some can't afford it and now because some say it is "unaffordable". That is just as much an opinion and holds equally as much validity as those who say "RE is affordable because there are sales", because some realtors say it is and the banks are still lending money for real estate purchases.
Rather than making a blanket and false statement as "RE is really unaffordable" a far more accurate statement would have been "Some RE is unaffordable to some people".

One thing to note is who is the one who brought socialism into the discussion and is suggesting that those who think real estate is "unaffordable" are socialists. I just mentioned someone "so totally concerned about affordability" and was not the one who attempted to equate "affordability" concerns with socialism or being a socialist.
BC Landlord
Lord of the Board
Posts: 3592
Joined: Jul 15th, 2019, 2:18 pm

Re: Real Estate at a standstill

Post by BC Landlord »

DoDo1975 wrote: Sep 22nd, 2022, 12:36 pm I will provide an accepted method, of which there are many; but they are all similar. Kelowna does not come close to meeting the threshold any which way you slice it.

There are many different methods to calculate affordability of a market, but pretty much all of them use a measure of income and a measure of prices.
Just repeatedly pushing this nonsense won't advance your argument. There is no such thing as "affordability of a market". Affordability applies to individuals or households ONLY. However, some would use all kinds of statistical gymnastics to support their narrative, mostly for personal or political reasons.
DoDo1975
Generalissimo Postalot
Posts: 908
Joined: Apr 20th, 2006, 9:50 pm

Re: Real Estate at a standstill

Post by DoDo1975 »

BC Landlord wrote: Sep 22nd, 2022, 8:17 pm
DoDo1975 wrote: Sep 22nd, 2022, 12:36 pm I will provide an accepted method, of which there are many; but they are all similar. Kelowna does not come close to meeting the threshold any which way you slice it.

There are many different methods to calculate affordability of a market, but pretty much all of them use a measure of income and a measure of prices.
Just repeatedly pushing this nonsense won't advance your argument. There is no such thing as "affordability of a market". Affordability applies to individuals or households only. However, some would use all kinds of statistical gymnastics to support their narrative, mostly for personal or political reasons.
And yet every major bank, economist and realtor trade group as well as all levels of government use such measures. I guess they haven't been schooled by a small time landlord yet.

I will let them know to attend your next economics lecture. Where do you teach, the University of Phoenix?
Mazdatruck
Board Meister
Posts: 457
Joined: Nov 20th, 2018, 1:46 pm

Re: Real Estate at a standstill

Post by Mazdatruck »

Houses were "afforable" because interest rates were so low.

If you had access to credit/leverage/downpayment/parental help there was virtually no limit to affordability. The example I posted that was placed on Canada's biggest financial discussion forums showed this, people were given huge mortgages with very little income or meaningful employment to back it up. Everything was afforable to them.

If you didn't have access to credit/leverage there was no way in unless you saved for 15 years and wanted to move to Estevan. Nothing was afforable.

Now that interest rates are high the people who said everything was afforable and are living in over leveraged houses will be asking for welfare checks from Daddy Trudeau within 24 months.

Reading through pages and pages of this discussion is painful. It's not even a debate but self-labeled landlords and real estate bulls keep the lie going because they feed their families with those lies. They HAVE TO lie otherwise it's like financial suicide. It's just a circle though it's not a debate. You're talking to a wind-up real estate doll.

Moving on...

https://betterdwelling.com/canada-is-he ... xford-econ
Oxford Economics warned investors to prepare for a hard landing for Canada’s economy. The research firm attributes the coming shock to high debt loads, elevated inflation, and rising rates. The resulting shock is forecast to lower home prices around 30% from the peak.
Already at -30% from peak in some places in BC!
BC Landlord
Lord of the Board
Posts: 3592
Joined: Jul 15th, 2019, 2:18 pm

Re: Real Estate at a standstill

Post by BC Landlord »

DoDo1975 wrote: Sep 22nd, 2022, 8:46 pm
BC Landlord wrote: Sep 22nd, 2022, 8:17 pm
Just repeatedly pushing this nonsense won't advance your argument. There is no such thing as "affordability of a market". Affordability applies to individuals or households only. However, some would use all kinds of statistical gymnastics to support their narrative, mostly for personal or political reasons.
And yet every major bank, economist and realtor trade group as well as all levels of government use such measures. I guess they haven't been schooled by a small time landlord yet.

I will let them know to attend your next economics lecture. Where do you teach, the University of Phoenix?
And you are making it all up. In reality, no "major bank, economist and realtor trade group" use such bogus metrics. Politicians, maybe.
DoDo1975
Generalissimo Postalot
Posts: 908
Joined: Apr 20th, 2006, 9:50 pm

Re: Real Estate at a standstill

Post by DoDo1975 »

BC Landlord wrote: Sep 22nd, 2022, 9:19 pm]
And you are making it all up. In reality, no "major bank, economist and realtor trade group" use such bogus metrics. Politicians, maybe.
Is this a mic drop, or a booya. Not sure.

http://www.rbc.com/newsroom/reports/rbc ... ility.html
http://download.remax.ca/PR/REMAX2022Ho ... yIndex.pdf

To argue that the measures are flawed is one thing, but to claim the concept of market affordability doesn't even exist. Sorry, that's bananas.
BC Landlord
Lord of the Board
Posts: 3592
Joined: Jul 15th, 2019, 2:18 pm

Re: Real Estate at a standstill

Post by BC Landlord »

DoDo1975 wrote: Sep 22nd, 2022, 9:26 pm
BC Landlord wrote: Sep 22nd, 2022, 9:19 pm]
And you are making it all up. In reality, no "major bank, economist and realtor trade group" use such bogus metrics. Politicians, maybe.
Is this a mic drop, or a booya. Not sure.

http://www.rbc.com/newsroom/reports/rbc ... ility.html
http://download.remax.ca/PR/REMAX2022Ho ... yIndex.pdf

To argue that the measures are flawed is one thing, but to claim the concept of market affordability doesn't even exist. Sorry, that's bananas.
Nowhere in your links you provided it refers to "market affordability" at a first glance. Where did you come up with that from? I am not going to dig 15 pages deep into your links to find what you meant. Give me a gist.
DoDo1975
Generalissimo Postalot
Posts: 908
Joined: Apr 20th, 2006, 9:50 pm

Re: Real Estate at a standstill

Post by DoDo1975 »

BC Landlord wrote: Sep 22nd, 2022, 9:37 pm
DoDo1975 wrote: Sep 22nd, 2022, 9:26 pm
Is this a mic drop, or a booya. Not sure.

http://www.rbc.com/newsroom/reports/rbc ... ility.html
http://download.remax.ca/PR/REMAX2022Ho ... yIndex.pdf

To argue that the measures are flawed is one thing, but to claim the concept of market affordability doesn't even exist. Sorry, that's bananas.
Nowhere in your links you provided it refers to "market affordability". Where did you come up with that from? I am not going to dig 15 pages deep to find what you meant. Give me a gist.

*bleep* you think the entire articles are about. Admit you are wrong instead of trying to backpedal out by finding a technicality.

I feel like I am arguing with my 12 year old about wearing a crop top.

Return to “Social Concerns”