That sound you heard between the rumbles of thunder and the shofar blasts this week was the collective sigh of Vancouver residential property owners looking at the August sales figures.
Yes, in this, the most overvalued, frothiest, most bubblicious real estate market in Canada, sales in August were up more than 50 per cent over last year.
The consensus seems to be that Vancouverites who are already willing to spend upward of 70 per cent of their household income to keep a roof over their heads are in a buying mood again. They’ve figured out how to navigate or have found creative ways around the stricter lending rules and are jumping in before Finance Minister Jim Flaherty clamps down even harder.
But with Vancouver home prices still hovering at double the national average, you have to wonder: Who is buying?
Popular wisdom is that foreign money is fuelling the market: wealthy Chinese investors parking their cash in the relative security of $2-million or $3-million Vancouver homes and driving up prices.
The degree to which foreign buyers are fanning the market is a continuing debate. In any case, the theory fails to explain why the fixer-upper bungalow up the street from me in East Vancouver is listed at $930,000.
No, something else is going on here. Who are the buyers? I have a few ideas:
1) Slumlords. As is the case everywhere else in the city, property values have risen dramatically, even in Vancouver’s least desirable neighbourhoods. Owners of SROs, flophouses and falling-down vermin-infested tenements are cashing out of the slum business and investing in only marginally better-maintained condominiums. And the good news is that they’re holding onto the cash that the Residential Tenancy Branch has ordered them to pay to tenants they housed in deplorable conditions for decades. That’s found money: They can use it to increase their down payment and reduce mortgage costs.
2) Vampires. The estimated life span of a vampire in good health is 800 to 1,000 years. This affords gainfully employed vampires who manage to avoid frivolous spending the opportunity to save enough money for a 25-per-cent down payment on a single family home in Vancouver by the time they reach 400 years of age. Vampires have the added advantage of being able to attend overnight open houses hosted by vampire real estate agents, which is why so many mortals find themselves out-bid by dawn.
3) Goalies. Well, one goalie.
4) Former high-school chemistry teachers now cooking crystal meth. If Breaking Bad’s Walter White has taught us anything, it’s that a career in the production and distribution of crystal methamphetamine not only can be lucrative, but empowering. Real estate investment in Vancouver requires a stomach for risk, and the confidence and feeling of invulnerability that comes with having to murder your competitors in cold blood can serve you well.
5) Transit police officers. A transit police officer who pulls even a moderate amount of overtime can earn an income well into the six figures. In addition, transit police officers have the opportunity to scan the lower mainland real estate market in real time on a daily basis, particularly high-value properties close to transit. They also appear to have ample time to stand around on Skytrain platforms and discuss the merits of various available properties with their colleagues.
6) Real Housewives. But not real housewives.
7) Granite countertop/stainless steel appliance fetishists. These are the rarely-talked-about drivers of the Vancouver real estate market, known by insiders as “Rennies.” They are known to drive up the price of condominium projects by bidding against each other where ample granite surfaces and high-end appliances are on offer. So great is their influence that condo-marketers can often presell entire buildings with little more than a photograph of a glass of Chardonnay sweating on a granite counter top bathed in the reflected light of a gleaming refrigerator.
8) News aggregater website entrepreneurs. As masters of click-bait with little or no journalism training, these shrewd business people have amassed fortunes by simply reorganizing and repurposing content provided by actual news outlets, turning fractions of pennies into millions of dollars. They tend to snatch up properties with coffee shops at street level to avoid overhead.
9) Oprah. Because she can afford to buy a home wherever she likes, even in Vancouver.