investor alert!

Investor alert! Looking for a great tax write-off? Think that you might need some capital losses to offset those smoking capital gains of the last few years?

Take a look at this one! It's really quite adorable, and is already tenanted at 1100 skins a month! There is no grub problem in the lawn, the skunks are taking care of that for you! Who needs nematodes?

Now, I know you may be thinking what a great deal this is, and may just skip some of the more rudimentary calculations (like; what will it cost me, and how much income do I need to support the purchase?), so I've done them for you (courtesy of canadamortgage.com) :

The Bottom Line

% Down Payment 5 %
Mortgage TERM : 5 Yr - 6.23%
Down Payment $ 28,950
First Mortgage Amount $ 550,050
Insurance Fee ( 3.25 % of mortgage ) $ 17,877
Total Mortgage Amount $ 567,927
Monthly Mortgage Payment $ 3,715
Monthly Property Taxes $ 212
Monthly Condo Fees $ 0
Monthly Heating Costs $ 0
TOTAL Monthly Payment $ 3,927
Household Income Required $ 160,288

Well, maybe you'll call in the bulldozers and build some hideous 2500 square foot monster in inappropriate colours, with inappropriate materials and attention to detail, etc. That will cost you only $312,000 - odd dollars. You are going to have to sell that monster for very close to a million bucks just to make it worth your while. You might even break even. It will only cost you about $24K to carry it while the new "house" is being built.

So, what if you can sell it for $979k (that gives you a $100k buffer for commissions, permits, PTT, GST, cost over-runs, etc.)? Who will buy it?

Well, maybe someone who bought some piece of junk 20 years ago, and sold it for $489 K, and is trading up (as if). Here's their bottom line:

% Down Payment 50 %
Mortgage TERM : 5 Yr - 6.23%
Down Payment $ 489,500
First Mortgage Amount $ 489,500
Insurance Fee ( 0 % of mortgage ) $ 0
Total Mortgage Amount $ 489,500
Monthly Mortgage Payment $ 3,202
Monthly Property Taxes $ 212
Monthly Condo Fees $ 0
Monthly Heating Costs $ 0
TOTAL Monthly Payment $ 3,414
Household Income Required $ 128,026

That's not too bad I guess. Quite a bit above median wage, but who's asking for documentation? Let's just hope the market keeps rising.

Oh, and what's with the agents who can't take a level photo'?

EDIT:

I forgot to mention that the blurb said: Offer to be presented on July 26th 2007 if there is any. Phone first.

I won't go into the grammar, but today is the 26th, so you may have missed your chance. This place was probably snapped up by someone who sleeps with an oven.

better than a condo

Today I did something that I have not done for some time - I did an RE search of all of E. Vancouver for SFH $400k or less. I got 4 hits and thought cool. Well, maybe not.

All of the four were on lots of dubious size. One was a wreck perched on an alley down at the bottom of Commercial Drive, and while the lot is a fairly normal size, they expect a quarter million shiboobles for a 1/3 "undivided interest" in the lot - that your shack will share with two other shacks. I've seen this "undivided interest" before, and don't know what it is, but I will bet that it is not in any buyer's interest to get involved.

The one featured here is on a 26' x 63' lot, and is proclaimed as a great holding property.

Here's the blurb:

Fantastic opportunity. Come & look at this 2 bedroom starter home. Close to skyt rain. Much better than a condominium. Create your own little dream home here. Bu ilt-in alarm, 2 skylights, well looked after. Nice garden area, fully fenced for your kids & pets. Great holding property.

All this for $349k.

OK, so it's not very big (700 sq. feet). We know that the photographer did not take the shot from the middle of the room, but was dizzily perched on the arm of the sofa, and up against the wall. That's a teensy-tiny living room, but still bigger than what you would get in a CONdo for a like price. Is it just me, or does that doorway look kind of narrow? Like, about 2 1/2 feet narrow.

It would appear that the agent was still woozy from taking the living room shot when she took this drunken pic'. Maybe the angle is what makes the place look so big.

The feature list elicits questions.

Features: Security System
Embedded oven

Er, where is the oven embedded? Is it like one of those Van City mixer mortgages, but you have to sleep with the oven? Is it embedded in the back yard, where it fell from a passing aircraft? Is the embedded oven a feature of the security system - as in - no one can steal your oven? Is the stove floating around somewhere, moaning in it's disembodiment from the oven?

There is a good point though - it is better than a CONdo - 700 square feet, and a garden, and it's only forty five minutes to downtown by bus (actually, it's not far from the 29th Ave. skyt rain).

Maybe next week I'll do a search for $450k or less.

addendum:

I think I may have found out about the embedded oven.

Yes, it is a bit primitive, but there isn't much room for a kitchen in this converted double-wide. It comes with the over-bed sprinkler system to keep you safe.

Breakfast in bed every day, and, saves on heating bills.

update

There is an update to this story over at The Republic.

Find more here,here, and follow the links.

It really isn't about hippy-dippy "New World Travellers" and such, but at the same time, it is. There is some wild reading to be had, and I encourage you to follow it. It is most interesting in the larger context.

I think that we, as a society, are at one of those "forks in the road", and we need to decide how to go forward - as everything that we believe comes into question. Make your own conclusions.

curbed

Not much to say for me these days, so I thought I'd drag out the curb thang agin.

I wrote about this place back in November. This is what became of the funky little cob house, and the de facto park that had grown on the lot over the last 20 years, or more. The place is done now, and doesn't look too bad (the fences and ladders are gone. At least it "fits" into it's surroundings.

I wonder if that chimney is for a wood-burning fireplace (I thought that that was not allowed in the city any more), or is just an architectural "feature".

I don't know if these homes are full of suites, or not, but the front place looks quite big. I don't like strata though. Why not just subdivide the lot?

You will see the tiny cob house that used to be there below. I think that it would have been very cool if the developer had built something along that line - just much bigger. Building materials are cheap, and it is very flame resistant to boot. It reminds me of some of Gaudi's buildings in Barcelona.

the tenant

Well, that last post was a sleeper...

Van-City Slumlords is a new blog taking on specuvestors(?) who are trying for ridiculous amounts of rent. The blogger is choked. Understandably.

I don't have much trouble with my tenancy. I have lived in the house for 7 1/2 years, and have had only 2 rent increases (in line with the RTA). Management changed a couple of years ago, and the accountant now collecting the rent tried to raise it by about 13% last winter. I told him that he had a choice between not raising the rent, and keeping us, or having to make some hefty modernizations, and good luck that the new tenants don't turn it into a grow-op. He didn't raise the rent.

I am lucky though, I have been here quite a while, so the rent was reasonable in the first place. I am glad that he didn't call my bluff though, because by all accounts, trying to rent right now is a nightmare. Amateur LL's trying to cover ridiculous mortgages with ridiculous rents on ridiculous hamster cages with ridiculous terms, and other pieces of like shite. I definitely would not buy anything. I would leave town - much as I do really like it here.

I really think that with the squeezing of tenants to cover just a part of the mortgage, the game is well nigh over. Idiots may be "happy" enough to drop 70% of take-home pay on their own abode, but there is no way on earth that people are going to pay that kind of money to rent a hell-hole. The buck stops with the tenant. That is the margin.

Check this blog out (link in sidebar). It's full of vitriol and foul language, but is a good measure of what is going to happen. At least that's what I think. The blog has video, and links that show that this is not just a local phenomenon either.

Let them eat cake indeed.

cartoon culture & funny money

I think that I might know what part of the problem is. A big part.

We do not value money, or what it represents.

What the fletch am I talking about?

Think about it - what do you think of when you think of the coins in your pocket? Dollars? Dinero? Monedas? Loons? No, you most probably think of them as loonies and toonies (or would that more properly be two-nies?). Yes, that's right - cartoon money! And when the banks will give someone like me $600G's at 4.2% (that was a couple of years ago), money is too easy to get. But it's not really. It's easy to get "credit" - which is just a polite term for debt - but the "real" money to pay that debt back, is not so easy to come by.

Our national currency reduced to a joke. How sad a mind-set is that? There are jokes to be had, but... I saw Ric Mercer Talking to Americans, and he talked to them about loonies and toonies (or is that more properly tunies?), and that we are to have a new, five dollar coin - to be dubbed The Woody. The Americans congratulated Canada on getting it's first woody. Ha!

I have little against coins (I still pick up pennies) - they are probably worth more intrinsically than notes, and cost more to produce. It's funny though, because notes were originally introduced to lighten the burden of carrying gold and silver around. That's a whole other discussion in the offing.

Anyhow, I always call my coins Loons and Doubloons. I just think it's more classy. A five dollar coin ought to be called a ducat, and we could call the $8 coin a deux-quatre (doo-catra).

I was just looking for some Loony Tunes imagery, and made some astounding discoveries. You can get loony tunes cheques, wallets, and Hasbro games cheques - including Monopoly cheques! For real. That is unflagging ridiculous.

Am I on to something, or what?

I will leave you with these disturbing images;


Our National Currency?





Warner punishes Canada by reducing the currency to a cartoon. The cheques (or "checks" in the US - there are no balances) are for real. You can get them yourself!
Don't forget your handsome checkbook (sic) wallet!


Here - print some of these up, and buy a couple of CONdo's, or get that address in Shaughnessy.





I wonder if that disc, offered by these Warner execs, is a copy of Matrix?

Hope you liked our show!

Disclaimer:
I have modified and used these images for entertainment and illustrative effect only. My use of them is under the Fair Use Policy - as described by Wikipedia. I have no affiliation with Warner Brothers, and they have not endorsed, n'or agreed with the content of this article or site.

collapsing?

OK, this is anecdotal, but I wonder if it is a sign of the beginning of the end.

My "neighbour", whose property I have written about here, here, and here (and maybe a few other places), told me today that his deal to sell his house had collapsed. It seems that the RE agent (he is also an agent) who was going to buy his place for $795K, has backed out of the deal because the person that was supposed to buy her place (another realtor perhaps?), couldn't sell their place (and so on).

The price point is in the high "low end", so I wonder if this is a sign of shaky knees in the market. Finally.

I must say that I do have a certain schadenfreude about it, as I and my family have been living in a construction zone for the past 9 months. Flat tires, noise, damage to my (rented) property, etc. It is unlike me to have those types of emotions, but...

It will be interesting to see if he can flog it without losing too much money. I will keep you up to date (whether you are interested, or not), and will probably feature the monster in the curb appall series.

ADDENDUM:

So, the BoC hiked rates by a quarter point today, and the reaction was interesting. I don't know if it was a reaction, or just the normal inscrutability of the markets, but the Dow was down, TSX was down, and the dollar was down a half cent. I don't know about oil. It was interesting to me that the dollar actually went down.

The BoC is kind of stuck - with over a quarter million jobs lost in the Ontario and Quebec manufacturing sectors in the last three years (some 39,000* jobs lost just in June), while the West continues to be smoking hot. Alberta is hot on oil and gas, and BC is hot in ...construction (those Microsoft jobs are meaningless in my HO).

The housing market in the US is still in the process of shaking itself out, and I think that it is starting here.

I wonder if rates will rise again in September. I'm not sure that they will, because the East is kinda hurting, and receives more attention in these things than does the West. It's further interesting that the East has lost so much with rates low - that should have dinged the dollar a while ago, no? (presuming that it was the high dollar hurting exports)

I have a feeling that things are about to get really interesting. The bankruptcy rate is double what it was a couple of years ago, and it won't be just mortgage rates going up. How about all those HELOC's, LOC's, credit cards, etc. being hiked too.

Gotta go and pay off my credit card, and look for the best plan for my cash.



*working from memory - it might have been 31,000 jobs lost in June.

I grabbed the picture from this blog - red guy blue state - who grabbed it from somewhere else. The red guy is blogging on RE in the US, and is worth perusing.

I like the "Doh!" take on Munch's The Scream, which I have used somewhere here before.

a lighter side

I've been doing the curb appall/appeal series for a bit now, and it's been fun, but it is starting to depress me. Maybe I'm already depressed. Maybe I'm just tired and brain-dead.

Anyhow, laughter is the best medicine (or so it is said), and it's always more fun to laugh at one's self. ulsterman provided the link (over at vancouvercondo.info) to Rick Mercer's take on Vancouver being pronounced one of the top cities to live in in the world. I am embedding the video here for some comic relief.

The woman who paid $585k seems a bit embarrassed to admit it, and she ought to be IMHO.

Gotta love Mercer and his way of getting people to laugh at themselves (or make fools of themselves...). Enjoy.

curb appeal - humble houses

I reckon it's time to move the San Andreas Champagne engagement ring love shack grow-op down on it's way into the memory hole, and good riddance.

Call me crazy, but I have always liked this little house near Trout Lake. Nothing ostentatious about it, just a simple little house with some character, on a fairly quiet street. It's the kind of place that I would be willing to pay $250k for, plus another $50k, plus some sweat, to fix it up and live in it.

But alas, I'm sure that it will be bull-dozed, and some hideous Vancouver Specious will take it's place. That monster will have a bunch of suites in it, and the area will start on a slow decline.

It's all about "eco-density" (TM - Sam Sullivan). There's not much ecological friendliness in sending hundreds (if not thousands) of these houses to the land-fill, and bringing in machinery to tear things apart, and more machinery to haul it away, and more machinery to make it look "pretty" again.

There will be trees and shrubs and hedges torn out, and the yards will be paved with concrete. Painters will dump their paints and solvents down the sewers, and the streets will be littered with screws and nails that will find their way into our tires.

I'm sure that a lot of people would be glad to get a place like this for 300 - 350K$, but the more voracious have their eyes on it as a vehicle of profit, and they will build some junk on it.

I really hope that this madness ends soon.