In what world do the banks have to tell the government to rein in lending and squeeze profits?

The article points out that the banks aren’t so much concerned about people defaulting on their mortgages (the government owns that risk), what they’re really concerned about is mass foreclosures affecting peoples ability to pay off their credit card bills and other loans, since THOSE debts are not government insured.

So these are the big banks, why don’t they just tighten up their own lending standards? Patriotz summed the issue up nicely:

The banks are essentially facing a prisoner’s dilemma problem. They know that if the bubble continues, and collapses, they all will be worse off. But there is no incentive for any individual bank to restrict lending, because its competitors would just take the business, and thus that bank would end taking the biggest hit.

Also an agreement among the banks to restrict lending, even if it could be arrived at, could be viewed legally as a conspiracy in restraint of trade.

So the banks must appeal to a higher level to restrict lending to all of them equally.

So will Flaherty listen to the banks and tighten up mortgage lending standards and if so, what form will that take?  One point to remember is that this issue is about a national housing bubble, and I don’t believe there’s another major market in Canada that is as detached from local incomes as Vancouver.

update: Patriotz points out that Flaherty has made his decision, and somewhat sensibly decided to stick with the ‘warn them mildly and let them dig their own grave’ approach.

“In terms of Canada, we’ve been watching and monitoring carefully and we continue to do that. There are certain tools available to the government if we choose to use some or all of them. As you know, we did so in 2008, and we’re continuing to watch. Right now, there is no compelling evidence of a housing bubble in Canada. There are some signals in the market that are concerning,”

Mark Carney of the Bank of Canada feels the same way:

The central bank has no immediate worry about a housing bubble. However, Mr. Carney reiterated that households should be cautious about taking on home loans at current rates, which will inevitably rise.

“We’ve alerted to this issue, the broader issue of household debt,” Mr. Carney said. “We want to ensure people manage their affairs recognizing that the current situation with interest rates is extraordinary and extraordinary won’t persist.”

Both Mr. Carney and Mr. Flaherty have been urging consumers to act cautiously when buying homes for several months now.

-Global stock markets slide
-Vancouver prices hit January peak
-Unveiling the Fairmont Pacific Rim
-Fixed or variable rate mortgage?
-VREAA: Froogle Scott 3
-Whistler debt woes mount
-Our friend Bob in Seattle
-Canadian building permits rise
-They’re laughing with you, not at you
-Boon or bust for the Downtown East Side

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have and excellent weekend!

Room 32 of the B.C. Supreme Court in Vancouver is where dreams of owning a home go to die. It’s the main foreclosure court in the Lower Mainland, where banks and other lenders ultimately turn when homeowners can’t keep up with their mortgage payments. The homes get seized, then sold off. “There are many tears on that carpet,” says Andrew Bury, a partner at Gowlings and the top foreclosure lawyer in the city. But lately the cramped courtroom has come to represent something else entirely—the utter insanity of Canada’s red hot housing market.

Last week Bury was in court to seek approval for the sale of a one-storey foreclosed home in central Richmond for $670,000. That was already $40,000 more than the house had been valued at two months earlier. Then, as he always does, Bury asked whether any other bidders were interested in the 2,000-sq.-foot home. Ten hands shot up. What happened next left him stunned. After a secret auction, the winning couple offered a whopping $852,500. “That’s an extreme case, but it’s the kind of thing we’re seeing all the time now,” says Bury. “It’s a feeding frenzy out there.”

The article points out that we have many scary similarities to the US housing bubble and excessive household debt levels that have raised alarm from many corners.  All the same arguments have been made for why ‘it’s different this time’ from ‘wealthy foreigners’ to ‘drug money’ to that old ‘running out of land’ gem.  Meanwhile the elephant in room keeps getting bigger and bigger.  Interest rates going up just a few percentage points ( a near certainty ) will push many people into deep financial trouble.  Unfortunately as the situation down south showed us, it’s not just first time home buyers and recent purchasers that get hurt when speculative housing bubbles collapse.

RBC chief economist and senior vice-president Craig Wright said much of the debt concern centres around higher real estate costs. “Historically, if you look at the housing market, it’s always highest [in B.C.] in terms of affordability.”

The survey also notes that B.C. residents have the grimmest assessment of the economy in the country (43 per cent characterized it as good, compared to 48 per cent nationally), something Wright found a bit surprising because RBC expects the 2010 Olympics to boost B.C.’s economy into recovery mode. “It may be that [B.C.] is looking backward instead of forward.

“We expect to see B.C.’s economy grow by a solid 3.3 per cent in 2010 before moving higher to 3.4 per cent in 2011.”

Good solid growth, I’m guessing that’s why they’re sponsoring the games.

A plan to berth an 1,100-room cruise ship in North Vancouver for use as a floating hotel during the Olympic Games appears to be in serious danger of sinking.

Edmonton-based Newwest Special Projects – which has marketed the Norwegian Star to Games visitors for the past nine months – said in a statement over the weekend that sales have been disappointing while expenses have increased beyond expectations. It said it is negotiating with its partners to try to lower costs and keep the project alive.

They initial priced rooms at $1,300 a night, dropping that to $500 per night in October and recently lowering starting prices to $275 per night including free meals.  They appear to have removed their booking gateways from the internet as they work out their current problems.

VANCOUVER, British Columbia – Five blocks away from the venue for Vancouver’s Olympic opening ceremonies, four grizzled addicts huddle in the rain, injecting themselves with heroin behind a trash bin.

Welcome to Downtown Eastside. Here, life is gritty, volatile and the slightest misstep can invite brutal retaliation.

“It’s a jungle,” said Glen, a 49-year-old heroin addict who goes by the street name Trouble. “You want to get out of here.”

That’s from an article over at MSNBC, and it doesn’t really improve after that:

As Vancouver prepares for the Olympics and the descent of the world’s media, the Downtown Eastside remains a huge problem — 15 square blocks of despair, squalid rooming houses and alleys populated by thousands of addicts, the homeless, the mentally ill and the drug dealers who prey on them.

This neighborhood is the most concentrated drug and poverty ghetto in North America, with high use of heroin, cocaine and methamphetamine, according to criminologist Benedikt Fischer of Simon Fraser University. It’s also the only place in North America where drug addicts can shoot heroin into their veins at an officially sanctioned injection site.

Now why would a US news outlet want to make our city look bad?  I have a theory.  MSNBC is a joint venture between Microsoft and NBC.  I suspect that Bill Gates is jealous of our property values, particularly since the Seattle market has dropped so much, and he’s pulling some strings to make us look bad.  Everyone who lives here knows you don’t go down to Main and Hastings unless you want to score some junk or catch a hot new disease, so what’s the big deal?

Well that theory explains the yanks anyways, but what’s with the British?  They’re taking their potshots too, and we’re supposed to be on the same side!  We’re part of the commonwealth!  We’ve got the queen on our currency!

Conservative estimates now speculate that the games will cost upwards of $6bn, with little chance of a return. This titanic act of fiscal malfeasance includes a security force that was originally budgeted at $175m, but has since inflated to $900m. With more than 15,000 members, it’s the largest military presence seen in western Canada since the end of the second world war, an appropriate measure only if one imagines al-Qaida are set to descend from the slopes on C2-strapped snowboards. With a police officer on every corner and military helicopters buzzing overhead, Vancouver looks more like post-war Berlin than an Olympic wonderland.

That’s from the Guardian article Vancouver’s Olympics are heading for disaster.  You know what I think?  I think everybody is just jealous.

Thanks to G and jjss for the links!

-CMHC: Homebuilding poised for a revival
-Bankers get the bonus, taxpayers take the risk
-Demographia: Vancouver ‘least affordable’ housing (pdf)
-UBC: Olympics offer no economic gains
-Toronto and Vancouver have hottest market
-2000 fewer million dollar homes in the lower mainland
-Scotia Capital thinks Canada in a housing bubble
-Don’t bite off more mortgage than you can chew
-The Desjardins affordability index
-BOC: Household debt ‘most prominent risk’
-US home sales plunge, worst drop in 40 years
-Seattle home prices hit new low
-More China bubble fears

So what are you seeing out there in the streets and lanes of Vancouver?  Post your news links, thoughts and anecdotes here and have an excellent weekend!

For those keeping track, that’s the size of two parking spots.  You can tell your grandkids about the good ol’ days when your family lived in a spacious 450sq foot condo.

John Stovell, general manager of Reliance Properties, said there’s a strong need for more affordable rental units in the downtown area.

“So many people contact us, not with a specific size they want, or specific amenities, but they tell us where they want to be in the neighbourhood and how much they can pay. So often that amount is just not achievable for anything but a very specialized product like this,” he said.

“By cutting away the non-essentials, that is the only way to get to that price-point in Vancouver,” he said.

While Metro Vancouver home sales in December tracked a pace that was nearly three times higher than sales last January, board senior economist Robin Wiebe said new listings also rose keeping the overall market in balance.

“Though [the market] is closing on the top of the balanced range, buyers are provided with a reasonable choice as the go out searching for homes,” Wiebe said in an interview.

However, Wiebe added that “it wouldn’t take much to tip [the market] over into seller’s territory.”

That is one factor that has the Conference Board putting Metro Vancouver on the list of cities it expects will see property prices rise between five and just under seven per cent along with Victoria, the Fraser Valley, Calgary, Regina, Ottawa and Halifax.

Edmonton, Saskatoon and Montreal are among the cities that the Conference Board expects will see price increases over seven per cent, with Winnipeg Toronto and Hamilton among cities that should see price increases between three and five per cent.

The Conference Board is estimating that no Canadian cities will see price decreases in 2010.

The full article can be read in the Vancouver Sun.

Vancouver not only has the least affordable housing of 28 markets measured in Canada, but of 272 metropolitan markets ranked in Ireland, the U.K., New Zealand, Australia, the U.S. and Canada, according to statistics compiled by the Winnipeg-based Frontier Centre for Public Policy.

We’re number one! We’re number one!

The numbers are calculated by dividing the median (or middle) residential house sale price from the third quarter by median annual gross household income. In Vancouver, for example, a median home price of $540,900 was divided by median household income of $58,200 to create a multiple of 9.3. The group describes as “severely unaffordable” any reading of 5.1 and over.

Not only that, it is “unprecedented in modern history,” the group said.

Ah! A brave new era!  We’ve broken records and surely now prices have nowhere to go but up!  Congratulations to everyone who took part in the contest by bidding up home prices, and a special thanks to the CMHC.  I don’t think we could have done it without your generous support!

September 2003
My wife and I, first time buyers, purchase a 1940s stucco bungalow in the Grandview area of East Vancouver for the asking price of $355,000. This is about a year and a half into the current eight-year real estate boom/bubble. The lot size is 33 x 117, just slightly smaller than standard. The MLS listing gives the square footage of the house as 1860, which later turns out to be a 20% exaggeration. The house is only about 1550 square feet, split over two levels — the main floor, and a two-bedroom, ground-level rental suite. The rental suite is tenanted — a quiet single mum with stable employment and her teenaged son, who look at us with a certain amount of trepidation when we first tour the house. They needn’t worry. We’re happy to inherit good tenants, and do not increase their rent ($560 a month, plus 40% of the utilities) for the year and a half that they continue to live in the suite.
……. We avoid a bidding war because of the listing agent’s greed. She wants to sell the house to her own clients and pocket both ends of the commission (“double-ending”). So she doesn’t have an open house. And the home owners perhaps aren’t savvy enough to demand that she have one.

Read the whole first installment at the VREAA site.

-The newest winter Olympic event: Foreclosure
-The Cecil’s brass pole to be replaced with a glass tower
-Listings start to grow again
-Canada #9 on ‘quality of life’ index
-Canada #6 for ‘best opportunity for capitol appreciation’
-Update on Canadian credit – not good news
-Toronto commercial real estate sinks
-Global housing bubble comparision
-Getting harder to get an Uncle Sam mortgage
-Landlords getting hosed
-The global debt bomb

So what are you seeing out there?  Post your news links, thoughts and anecdotes here and have an excellent weekend!

Millions in the United States are homeless as a result of the subprime mortgage debacle, which had the effect of vastly inflating both the seeming buying power of consumers and seeming value of houses.

In short, Americans were getting credit at rates so low that they could buy way more house than they could afford if credit charges increased, which they did.

We don’t have a subprime problem here, so we won’t have a real-estate bubble, we are told.

In fact, just this week, Bank of Canada officials were assuring everyone that steep increases in house prices are the “natural” consequence of pent up demand during the recent trough, which also had the effect of suppressing prices so that surging prices now appear to be surging faster than they are.

Now, I’m no expert and I’m inclined to believe what the experts tell me.

But I also hear opinions of people in the property racket who aren’t so sure. And their concern is not so much that Winnipeg house prices have climbed 78 per cent in the past four years, as the new reassessment reveals. Or that there are stories about house hunters sleeping in the streets of Vancouver in hopes of snapping up a $1-million house that we would pay no more than $350,000 for.

No, their concern is that low interest rates and long-term amortization periods are making it easy to get into the market — maybe too easy. But more concerning is that all this demand is being insured by the Canadian Mortgage and Housing Corp.

ahh, yes, the good old CMHC.  So what could be the problem of the CMHC insuring demand for Canadian houses?

As the financial crisis started to hit in 2008, the federal government increased the ceiling of mortgage insurance CMHC can have outstanding — from $350 billion to $450 billion, and then $600 billion.

The move is widely regarded as a key measure that helped prevent the kind of credit crunch that so hurt the United States. And just about everyone who has commented on the changes, including Liberal finance critic and former bank president John McCallum, are cool with that.

But my sources wonder if CMHC, which insured 920,000 housing units in 2008, 350,000 more than it intended, according to the Globe and Mail, was in a position to ramp up its due diligence as fast as it ramped up its underwriting.

It’s a good question because, if there is a bubble, Canadian taxpayers will be on the hook for all the paper.

The full article can be found here and is a good read.

“While low interest rates were a principal factor driving home-buying activity, no one can discount the value that Canadians place in owning a home,” says Polzler.

Because of the increase in first-timer interest, the real estate industry was able to shrug off initial forecasts of a totally bleak year.

By the time the year-end national tally is complete — something that should come in the next week or so — 465,000 homes will likely have changed hands in 2009 in Canada, a seven-per-cent increase over 2008, predicts a Re/Max report.

“Some of the greatest percentage gains were reported in Western Canadian markets in 2009, demonstrating the higher the peak, the lower the valley,” says Elton Ash, executive vice-president of Re/Max of Western Canada.

“That said, the recession barely registered on year-over-year activity in most major centres — and the economic fundamentals in place going forward ideally positions the 10 provinces and the sector overall for further growth.”

“While low interest rates were a principal factor driving home-buying activity, no one can discount the value that Canadians place in owning a home,” says Polzler.

Because of the increase in first-timer interest, the real estate industry was able to shrug off initial forecasts of a totally bleak year.

By the time the year-end national tally is complete — something that should come in the next week or so — 465,000 homes will likely have changed hands in 2009 in Canada, a seven-per-cent increase over 2008, predicts a Re/Max report.

“Some of the greatest percentage gains were reported in Western Canadian markets in 2009, demonstrating the higher the peak, the lower the valley,” says Elton Ash, executive vice-president of Re/Max of Western Canada.

“That said, the recession barely registered on year-over-year activity in most major centres — and the economic fundamentals in place going forward ideally positions the 10 provinces and the sector overall for further growth.”

The higher the peak, the lower the valley?

“I’ll guarantee it won’t hurt our values. I’ll guarantee it will maintain our values. The frightening part is if values go up too much. We don’t have financial sector head office jobs, no manufacturing. If we are basing things on local incomes, how does housing keep up with local incomes if we have a shortage? We have to be very careful on the affordability side.”

This is a very generous offer.  If anyone has the financial resources to ‘guarantee’ that your condo won’t drop in value it’s Bob Rennie.  This could be exactly what anyone who fears the fallout of a housing bubble needs to get them to buy property in Vancouver.  After all, many people are leery of buying in a market where prices are near record highs and there are no ‘financial sector head office jobs’ and ‘no manufacturing’, particularly when that city has a history of volatility in house prices and has seen market crashes of up to 50% in the past.  Watching people in cities around the world go into foreclosure or make mortgage payments that are far beyond the current value of their property doesn’t exactly instill confidence either, even if it IS different here.

I’m not sure exactly what the contract on this deal would look like but I imagine that you’d ‘lock in’ your purchase price and it would be held on record for any future point you decide to sell.  If the market goes up, you’ve made free money.  If the market goes down, I’m guessing Bob Rennie would write you a cheque to cover the difference between your purchase price and the price you were able to sell for.

Nah, that’s just silly… he’d probably have an employee write you the cheque.

I’m not sure if there are any catches, but with a deal like that how could you possibly go wrong?

-Canadian house sales reach record high in December
-Vancouver new house prices down 2.8% YOY
-New highrises won’t spoil view of north shore
-BabyBoomer demographic impact charts
-Graph: Peaked in Seattle
-Global leverage, house prices and consumption
-Canadians more cautious about debt than Americans
-One in every 7.5 US houses behind or in foreclosure

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

Metro Vancouver homeowners desperate to rent their properties to Olympic Games visitors have scaled back their golden expectations.

An abundance of Games-time accommodation rental options has forced asking prices down and increased the likelihood that many properties won’t attract any Olympic renters.

“Don’t base your food budget on the prospect of renting your home,” said Mark Szekely, site administrator for listing service rent2010.net. “It’s still a realistic possibility but if you’re outside downtown Vancouver or Whistler, you might not find a renter. It’s an oversupplied market.”

Anyone out there subletting their owned or rented house or apartment for the games (or trying to)?

http://www.bankofcanada.ca/en/speeches/2010/sp110110.html

This speech reminds us several times that rate policy is to be used to control inflation, and that housing is only one factor of many that affect inflation. Unfortunately the speech glosses over that housing is the sole factor affecting inflation currently, and how low rates have contributed to housing being the sole factor driving inflation.

“As Canada’s economic growth moves towards its potential, it is expected that a robust housing market, supported by exceptionally low interest rates, will continue to work as an important engine pulling the Canadian economy out of recession. This has implications for monetary policy, which, as I’ve said, aims to achieve the Bank’s inflation target of 2 per cent over the medium term. It’s important to remember that this target is symmetrical; that is, we are equally concerned about whether inflation is above target or below target – as we expect it to be until 2011. The revival of the housing market is one factor that is helping us to achieve our inflation target, and it is a powerful means through which monetary stimulus affects the economy. Of course, we need to keep a close eye on the housing market, along with all other sectors of the Canadian economy, to ensure that we are providing the right amount of monetary stimulus. In setting monetary policy, we view housing – or the exchange rate, the energy sector, the auto industry, or any other factor – through the prism of our inflation target.”

The speech then reiterates a previous comment from Mark Carney, that the BoC should not be managing the risk of financial institutions:

“An array of supervisory and regulatory instruments can be used by the government to restrain a buildup of systemic risks. These include capital requirements for institutions, leverage ratios, loan-to-value ratios, terms and conditions for mortgage insurance, and a variety of other measures. These instruments can be targeted to risks to the entire financial system that stem from particular markets or institutions.

Using these instruments to safeguard the whole financial system – not just individual institutions – is the essence of the macroprudential approach. Macroprudential supervision is one of several concepts in a current global initiative to strengthen supervision and regulation in the wake of the global financial crisis. In Canada, a system-wide, or macroprudential, approach is the shared responsibility of the Department of Finance and all of the federal financial regulatory authorities, including of course the Bank of Canada, the Office of the Superintendent of Financial Institutions, and the Canada Deposit Insurance Corporation. Ultimately, it is the Minister of Finance who is responsible for the sound stewardship of the financial system.”

Now Carney has officially passed the buck to Flaherty to cool the housing bubble. What remains to be seen is how Carney will reach target inflation
without housing being the sole factor if Flaherty does implement the proposed changes to cool the housing market. The BoC had predicted GDP growth to return to normal by now, yet the numbers are far less than predicted.

Oh, lastly this wonderful quote:

“Using the current path of household indebtedness, and alternative assumptions about how quickly interest rates may increase, the simulation generates a scenario indicating that, by the middle of 2012, almost one in ten Canadian households would have a debt-service ratio that makes them vulnerable to economic shocks.”

In 2 years if the BoC does nothing, 1 in 10 of us are in trouble. Thus why the BoC is taking the opportunity to pass the buck now.

-taylor192

Finance Minister Jim Flaherty has also mused about such measures, including raising the minimum down payment requirement above five per cent, or reducing the maximum length a house can be amortized from the current 35 years.

Reuters points out the interest choice of David Wolf to make this announcement, his opinion on the matter seems to have shifted dramatically:

Wolf, a former chief economist in Canada for Banc of America Securities-Merrill Lynch, was appointed as adviser at the central bank in April 2009.

When he was still in the private sector, in September 2008, Wolf had warned that the Canadian housing market was headed for a U.S.-style meltdown due to household finances that were in worse shape than in the United States or United Kingdom.

At that time he said his bank feared “it may simply be a matter of time” before home prices start plunging.

At some point in the near future stimulus measures will recede and rates will start to inch back up to historically normal levels.  How are you preparing for higher rates?  If you hold a mortgage are you locking in or are you counting on the low rates of today continuing for a lot longer?  If you’ve got cash, where are you sticking it?  Do you hold equities in markets that will be negatively affected by higher rates?

Are you profit taking, loss cutting or bet making?  It’s time to get ready for the end of free money.

“If you’re somebody in a situation that you have only five per cent down and you’re stretching to get in the market with a 35-year amortization, I think that would be a very precarious situation right now,” said BMO Capital market economist Robert Kavcic.

Conversely, he said, “if you’re sitting on a pile of cash and looking to move into the real estate market, it would almost be a no-brainer to just wait for lower prices.”

Mr. Kavcic isn’t the only one in that article that thinks buying right now would be a mistake:

“It’s absolutely not debatable that housing prices cannot rise faster than incomes over the long term,” said Will Strange, professor of real estate and urban economics at the Rotman School of Management.

Sooner or later, incomes have to rise, or home prices fall, for balance to be attained.

Many analysts argue that home prices are not yet out of line with the incomes it takes to pay for them, Strange said. Yet with the job market still weak, and unlikely to drive new employment and higher wages, odds are that if something’s got to give, it will be prices.

“If I didn’t personally have most of my wealth tied up in housing, this would not be the time that I would choose to jump in,” Strange cautioned.

Now keep in mind these comments refer to the national Canadian real estate market where house price increases are starting to outpace incomes in many cities.  Here in Vancouver things are different: house prices have been outpacing incomes for years.

-Royal LePage: Home prices to jump 7.2% in 2010
-Canada to surpass US residential mortgage debt in 2010
-Happy times for interest rates cant last
-Fasten your seatbelts homebuyers
-TD: who wants 5% back on your 5% down?
-Bottom line may trump social housing agenda
-US Apartment vacancy rate at 30 year high
-BCs leading economists predict 2010

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

The REBGV December 2009 stats are out and the average Vancouver House price has reached a mind-boggling $952,927 despite less than peak population growth rates.

Don sent in the information above – this chart shows Vancouver average house prices from 1977 to 2009 superimposed on a graph of the BC population growth in percent from BC Stats.  The $300k price point correlates to 3% population growth.

One thing to keep in mind is that some divergence is only natural: one percent population growth in 2009 represents more people than 1% in 1977 because we’re starting with a larger base population.  It’s still interesting to see the correlation between population growth and house prices.  There was actually very high population growth in the late 70s and early 90s that relates to those housing booms.  By the middle of the 90s this growth had real house prices nearly back up to what they were in 1981,

You can see the correlation between the housing market decline in the mid nineties and the drop in population growth.  We’ve never recovered that high rate of population growth (as high as 3% in the mid nineties).  We seem to have peaked at 1.7% in 2008.  It will be interesting to see what BC and Vancouver population growth does going forward – will ‘everyone want to live here’ or will we see a a decline in population growth with fewer infrastructure project jobs and less construction?

This year — unlike in January of 2009 when the system was turned on its ear by political interference — it’s fairly easy to figure out if you’ll win or lose when your tax bill comes out in July.

Let me illustrate with an example that, on the surface, looks scary: Say your assessment notice shows a 15-per-cent increase in the value of your home or business. What to do?

First, don’t panic. Take a moment to read this column, check our website and figure out what this really means.

You’ll find a 15-per-cent increase is no big deal if your home is in New Denver, Kitimat or Clearwater, or your business is in Peachland, Sparwood or Smithers. Because in these places the average assessment — not just yours — is up about 15 per cent. So the impact will be nil. Any hit on your tax bill in July will be due solely to increased municipal spending.

Phew!  But it’s a different story if you own property in a major urban center.

However, if this hypothetical 15-per-cent increase is for property in most urban centres — almost all of the Lower Mainland, the Capital Region or the Okanagan — then now might be a good time to panic. Because the average in these places hovers just a few points above or below zero. And if you have a significantly higher-than-average change in value, you get a bigger tax bill.

It’s how the change in your assessed value compares to the average for other properties in your community — not the absolute value of your assessment — that matters to your tax bill.

Well, I guess we’ll just have to hope that Vancouver City Council doesn’t want to raise any more tax money in the near future.  You can check the assessment online here if you haven’t received any mail yet.

UPDATE: Don and Larry point out that the REBGV stats package PDF for December is now available online.

Speaking of Dubai, here’s a dubious but interesting theory: The Skyscraper Index proposes that the nation with the worlds tallest building suffers an economic downturn sometime around its opening.  The worlds tallest building is now opening in Dubai, where some property values have dropped in half over the last year as their debt ridden economy falters.  Previous record breaking buildings have been the Empire State Building (US Great Depression), Sears Tower (70’s stagflation) and the Petronas tower in Kuala Lumpur (East Asian global financial crisis).

The next record breaking building is set to be the Shanghai Tower which is scheduled to open in 2014.

-Time for Canada to take away the housing punchbowl
-How big a mortgage can you carry?
-Its different in Seattle
-Nice home, wheres the rest of it?
-From Boom to Bust, how Ireland did the noughties
-USA: 10 years, no gain in house prices
-Renters win as vacancy rates rise
-Chinese RE bubble may lead to US style slump
-Five bubbles set to burst in 2010

So what are you seeing out there? Any predictions for the new year? Resolutions? Post your thoughts, news links and anecdotes here and have a great weekend and an excellent new year!