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Vancouver Property - How do I short it?

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Vancouver Property - How do I short it?

Overvalued, and betting on low rates forever

===================================

 

Items:

+ Valued at something like 7x Income

+ The "fourth most expensive" property in North America

 

Two Views (from Howe Street):

Garth Turner : Stay Away :: http://howestreet.com/audiovideo/index.php...ediaplayer/1296

Michael Levy : Buy it ! .... :: http://howestreet.com/audiovideo/index.php...ediaplayer/1299

 

I didnt especially rate Garth's podcasts before, but this one is very good.

I have to say that I agree with almost every word.

 

Michael Levy, normally a sensible guy, let's me down. He must be long V. property.

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I didnt especially rate Garth's podcasts before, but this one is very good.

I have to say that I agree with almost every word.

 

The TRAP HAS BEEN SET (in Canadian Real Estate):

Canada confounds people: more than 7x income, vs. 5x at the top in the US

 

"The only asset people buy, based upon peer pressure."

Cheryl King (Economist of Merrill Lynch, Ca.) is talking about 10% growth (she's clearly an idiot, he thinks)

Her predecessor, David Wo, called it well - was negative but accurate.

 

"WE KNOW what the future holds.

 

tn1248330246002689800.jpg

It's going to hold higher interest rate, higher inflation and higher taxes.

Anyone who isn't preparing for the, just isn't paying attention.

You dont prepare for the future by buying assets, like real estate (whose value is)

based upon borrowed money at historically low interest rates."

 

Garth Turner thought that, as a Conservartive MP, he should stay in touch with his constituents and serve them as an honest, responsive legislator. What a rube.’

Review of ‘Sheeple’ by Andrew Cohen, Globe and Mail

 

On Jan. 23, 2006, Garth Turner returned to Parliament as a Conservative. Less than nine months later, he was expelled from the caucus, stripped of his party affiliation, thrown out of his office and forced to sit as an Independent.

 

The reason, he says, was his blog. He just couldn’t stop writing about Ottawa – about a mean, mercurial prime minister, about his circle of humourless acolytes, about a regime of broken promises and false hopes.

 

Behold, then, Sheeple, Turner’s tale of his short, sour season as a Conservative in the 39th Parliament. In this minor saga – with the emphasis on minor – the maverick in cowboy boots takes on the party establishment in jackboots. It doesn’t turn out well for Turner.

 

= = = = = =

LINKS:

Garth Turner's Book Blog :: http://www.garth.ca/weblog/

GT's Real Estate Blog ..... :: http://www.greaterfool.ca/

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THIS makes me angry - but it should be read by anyone thinking of buying now

 

Somebody please hit this guy with one of the bricks he mis-sold !

 

lereah.jpg

 

A few months before the US housing market started a sickening slide which would last more than four years, David Lereah published his life’s work. As chief economist for the National Association of Realtors, Lereah was a media darling, jetted around the country in luxury, made a fat association salary and bought a massive McMansion.

 

His book, “Why the Real Estate Boom will not Bust,” predicted an endless appreciation for American real estate, just as he did in nonstop TV interviews, even as the historic slide in sales and prices started. In 2007 he was still pumping. “It appears we have established a bottom,” he said. And then the bottom fell out.

 

These days Lereah is unemployed, admits he “spun” for his former employer and has apparently given up trying to sell his house. And while a mini-boom has erupted in some markets as vulture buyers fight over homes selling for 50% of their value three years ago, most observers think US real estate will not bottom for another year or two. It’s ended up being the greatest destroyer of middle class wealth in modern history.

 

Lereah came to mind today as I read the latest news release from the Canadian Real Estate Association. While realtors always say they lust for a ‘balanced’ market, it seems they just can’t resist trying to turn stability into a circus. Like now.

 

“Potential buyers who moved to the sidelines late last year when economic uncertainty peaked,” says CREA president Dale Ripplinger, “are returning to the housing market now that the worst of the recession may be behind us.” Meanwhile Re/Max executive spokesguy Michael Polzler says, “recent buyers had been lucky to snap up some of the best real estate deals in years.” And adds LePage’s Phil Soper: “We believe this improvement represents a sustainable change across the country.”

 

There you have it, from the trio of media housing experts: The recession is virtually over. Today’s buyers are scoring bargains. And the housing rebound is going to last. The inevitable result, then: Higher prices.

 

Along with politically-engineered cheap mortgage rates, this is why a lot of young couples are buying. Because the Canadian clones of David Lereah are telling them it’s more than safe – it’s smart.

 

/more: http://www.greaterfool.ca/2009/07/14/peak-house/

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I was in Vancouver and Victoria this past May visiting friends. I lived in both Van/Vic from 1994 to 2002. It wasn’t until I left that property prices went crazy, up til then nobody talked about property. I honestly cannot remember a single serious conversation about property either when I studying or working there. I am now living in Dublin (2004-present).

 

During my 2-week visit in May I was absolutely gob-smacked by the psychology over there. It was like someone had rewound the tape back to Dublin circa 2004. Everyone, and I know a lot of people from diverse backgrounds, was singing the same tune – buy now, dead money, not making more land, Vancouver Olympics etc etc… And of course (some) of those who’d already bought had that all too familiar smug factor. The only word to describe it is ‘surreal’

 

As for shorting, I’ve been thinking about it since I got back. No idea though.

 

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...not making more land, Vancouver Olympics etc etc…

 

A great deal of mal-investment gets driven by fantasies surrounding the Olympics.

 

I agree that this looks like a great short. But how?

 

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Vancouver Property - How do I short it?

Overvalued, and betting on low rates forever

===================================

 

Items:

+ Valued at something like 7x Income

+ The "fourth most expensive" property in North America

 

 

Michael Levy, normally a sensible guy, let's me down. He must be long V. property.

 

I heard it too yesterday and funnily enough this morning it struck me how unreal his opinions were. it made me think the guy was insane and I needed to get on the opposite side of the trade. I had a quick search for Canadian REITs but many of them have followed the stock market down already.

 

They have had a bounce though (with the general market) and potential ones might be Canadian Real Estate Investment Trust (REF.UN) and Boardwalk (BEI.UN)

 

http://canreit.com/

http://www.creit.ca/

 

Not very Vancouver specific though

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