Foreclosures in Vancouver

[Cosmo]

Global news tonight (TV) was showing a Vancouver Condo that was, in essence, a distress sale.

As the realtor showed the news reporter the apartment, he advised the viewing audience that - last year - the owner purchased the place for $700K. Today the asking price had dropped to $499K.

(that's a drop of 28% for those keeping score at home, a final sale will be lower than that)

The owner couldn’t sell the place so he walked away from it. Fully furnished - just up and left it all.

The news then seguewayed into the fast rising foreclosures that are hitting hard in the Lower Mainland.

They were talking to a finance lawyer who stated that with the way the layoffs in the job market had hit, that with the way the OVER-EXTENDED are being hit, and with the 40 year, zero down mortgage folk collapsing... that this has resulted in foreclosures being up 150%!!!

The realtor commented that this is just the tip of the iceburg when you factor in how many people are in deep water.

(What a negative prick... doesn't this guy read this board????)

See the feature here...

http://canwest.a.mms.mavenapps.net/...8e60a971d5a69e38&maven_referralObject=3265700

 

[InTheBum]

What goes up...must eventually come down...

Funny, I recall everyone on this board saying that the cost of homes in Vancouver will just continue to rise, rise, and rise. I'm glad to be a renter in this environment and will probably buy a place when I think the bottom has hit...which we aren't even close to folks!

I feel sorry for people that bought in the last year or two and will have neighbours moving in next door soon enough, paying much much less than they did.

I told my family members to sell this summer, and get a smaller place, but they didn't listen and now their net worth is down probably 200 to 300k.


For anyone owning property, you better hope Obama is "The One", or the great olde US of A, is going to drag everyone down, much much further.

I'm expecting a very drastic simulus package by Obama and his Team come late Jan or Feb. Which will include massive Infrastructure spending and possibly lower mortgage rates/refinancing, to those who qualify (ie. still work and can possibly pay their future bills).

 

[ctctct]

do you think price in DT, around yaletown would drop to 200-300k?

 

[InTheBum]

do you think price in DT, around yaletown would drop to 200-300k?

No one really knows...but I wouldn't be surprised to see a 700k (off it's high) condo in DT hit 400k. 40% reduction is more than reasonable to expect...

 

[87112]

I watched that video and man 700k for a place so small and ordinary. 499k still seems 50-100k too much to me. Count me in as someone who in 2006,2007 didnt see the coming. All I heard was how rockin Vancouver home scene was. Factor in all the talk of Vancouver being world's best city to live and the amount of immigrants and I thought good times was here to stay.

 

[ctctct]

so who is at fault for our "housing meltdown" in canada if there weren't subprime loans in canada as in US? Job loss? financial institutions have tightened credit? or people?

 

[FunSugarDaddy]

While things were's quite so loose as they were in the States, you could still buy a house here for next to no money down. Amortization rates were pushed back from 25 years to 40 and if you had CMHC insurance you're downpayment was negligible.

Meaning of course the guy who bought for 700K and walked away from it, hasn't really lost anything, cause he never brought anything to the table to begin with, other than his credit rating.

I imagine it's the insurance company who losses the most, as they were the one's insuring the loan. Don't be surprised to see their rates increase.

 

[mclovin76]

or the banks not lending any money unless you got a 25 percent downpayment.

 

[FunSugarDaddy]

Maybe but ....

or the banks not lending any money unless you got a 25 percent downpayment.

Why would the banks take that position if they required that anything less than that be insured?

 

[InTheBum]

While things were's quite so loose as they were in the States, you could still buy a house here for next to no money down. Amortization rates were pushed back from 25 years to 40 and if you had CMHC insurance you're downpayment was negligible.

Meaning of course the guy who bought for 700K and walked away from it, hasn't really lost anything, cause he never brought anything to the table to begin with, other than his credit rating.

I imagine it's the insurance company who losses the most, as they were the one's insuring the loan. Don't be surprised to see their rates increase.

I wouldn't say he lost anything...he must of made several payments...approximately 1 yr and possibly a small downpayment. He likely lost his job and didn't expect the market here to bounce back anytime soon.

My question is...when this person walks, does he have to leave the country and never come back? What are his legal penalties if tracked down in Canada?

 

[FunSugarDaddy]

I wouldn't say he lost anything...he must of made several payments...approximately 1 yr and possibly a small downpayment. He likely lost his job and didn't expect the market here to bounce back anytime soon.

My question is...when this person walks, does he have to leave the country and never come back? What are his legal penalties if tracked down in Canada?

His legal penalties would be he possibly would get petitioned into bankrupcy. I'm not an expert in this field but what would happen if they pushed him hard enough is he would likely contact a trustee in bankrupcy who would provide him with a course of action.

Often bankrupcy isn't the only option and there could potentially be a debt settlement, whereby the partied owed the money can if they choose accept pennies on the dollar.

Again I'm not overly familar with this process by my guess is it would be CMHC or whoever insured the debt that would be the party taking action. I would also imagine since all real estate purchases who have less than 25% down would have to pay into this that they would have some sort of allowance for some % of these people defaulting.

But I would certainly welcome posts from those who are more familar with the process than I am, as much of this is essentially an educated guess.
I know people who have gone bankrupt, and negotiated settlement agreements, but real estate wasn't involved.

Leaving the country simply to avoid this issue would be a drastic move.