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jimtan
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CMHC - rents up, vacancy down!

Tue Oct 02, 2012 8:47 am

"The average national price for a two-bedroom rental in new and existing buildings rose to $887 in April 2012 from $864 a year earlier, according to the latest report from CMHC. The vacancy rate, meanwhile, slipped to 2.3 per cent from 2.5 per cent."

http://www.theglobeandmail.com/globe-in ... le4580893/

Stay tuned for detail report
 
vanpro
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Re: CMHC - rents up, vacancy down!

Tue Oct 02, 2012 8:54 am

This is from the CMHC Spring, 2012 Rental Market report for CMA's (doesn't included sub-area breakdown which is only in their Fall report that comes out every Nov.) - this story is from April/12....
 
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Re: CMHC - rents up, vacancy down!

Tue Oct 02, 2012 9:36 am

The BC report is located here. But the information is so old, the next semi annual report is due soon.
 
jimtan
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Re: CMHC - rents up, vacancy down!

Tue Oct 02, 2012 10:46 am

This is from the CMHC Spring, 2012 Rental Market report for CMA's (doesn't included sub-area breakdown which is only in their Fall report that comes out every Nov.) - this story is from April/12....
You're right. Just wanted to remind some people that vacancy is nowhere close to States levels in 2008. Or, even now in 2012.

Let's look at the Fall report. Will it be much worse?
 
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jesse1
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Re: CMHC - rents up, vacancy down!

Tue Oct 02, 2012 10:59 am

Expect further rental rate increase but, the thing is, increasing rents at or a bit above inflation will take over a decade to catch up. That's a long time for prices to remain flat. It will take even longer if prices revert to increasing at 5% per year or whatever the "experts" think they appreciate at. Of course things could catch up in a shorter time.

Rents are important, but one shouldn't lose sight of how distorted prices are right now.
There is no shame in overpaying
 
vanpro
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Re: CMHC - rents up, vacancy down!

Tue Oct 02, 2012 11:46 am

Expect further rental rate increase but, the thing is, increasing rents at or a bit above inflation will take over a decade to catch up. That's a long time for prices to remain flat. It will take even longer if prices revert to increasing at 5% per year or whatever the "experts" think they appreciate at. Of course things could catch up in a shorter time.

Rents are important, but one shouldn't lose sight of how distorted prices are right now.
Gotta agree with you on that point!!
 
jimtan
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Re: CMHC - rents up, vacancy down!

Wed Oct 03, 2012 8:39 pm

Expect further rental rate increase but, the thing is, increasing rents at or a bit above inflation will take over a decade to catch up. That's a long time for prices to remain flat. It will take even longer if prices revert to increasing at 5% per year or whatever the "experts" think they appreciate at. Of course things could catch up in a shorter time.

Rents are important, but one shouldn't lose sight of how distorted prices are right now.
Gotta agree with you on that point!!
Yeah! It's unbelievable how long prices have been distorted.


:mrgreen:
 
jimtan
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Re: CMHC - rents up, vacancy down!

Tue Oct 09, 2012 12:32 pm

The rental vacancy rate is important. A high vacancy rate allows newcomers the choice of Not Buying. They can rent until they are ready to buy, which may be never.

In the States, there was a huge vacancy rate before the crash. It allowed four years of Not Buying. Even so, we can see rental rates firming up in good areas and for good properties. Certainly, it's a good time for savvy investors as the 30-Year mortgage rate stabilizes at 3.5%. Quantitative easing works!

Unfortunately, Canada and Vancouver do not have the luxury of a large vacancy rate. In fact, a rate of 1% for Vancouver city means that there is no meaningful vacancy. Means that rentals will rise after just a year of Not Buying. Can you find a roof over your head?

So, Canada and Vancouver are different from the States and Ireland.

Match that with the relentless inflow of immigrants.

“In the larger picture, see this report 'British Columbia Regional District Migration Components 1997-2011'. On Page 5, the data for Greater Vancouver says 2010-11 had net gain of 26,135. Of which, net inflow of 27845 (international immigration) and 105 (interprovincial). Outflow of 1,815 intraprovincial.

So, the inflow of immigrants far offset the outflow of retirees from Vancouver. The important point is that the youngish immigrants are here to set up families. Means that they have the intention to buy RE when they can afford it.”


http://www.bcstats.gov.bc.ca/Files/1290 ... onents.pdf
 
fishguy15
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Re: CMHC - rents up, vacancy down!

Tue Oct 09, 2012 12:48 pm

Yeah! It's unbelievable how long prices have been distorted.


:mrgreen:
Which means that they will continue to be distorted???
 
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Re: CMHC - rents up, vacancy down!

Tue Oct 09, 2012 3:10 pm

In the States, there was a huge vacancy rate before the crash....
Absolutely false. Read all about it.
 
jimtan
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Re: CMHC - rents up, vacancy down!

Tue Oct 09, 2012 9:18 pm

In the States, there was a huge vacancy rate before the crash....
Absolutely false. Read all about it.
It's shameful the way that you CAN'T do research.

Data from 2007.

"The U.S. Census Bureau recently came out with its 2007 home vacancy rate data, and the Wall Street Journal has created a nifty map that makes it easy to compare Las Vegas with other parts of the country...

It's become fairly normal for Las Vegas to show up near the top of these housing economic charts, and there it is again: Las Vegas had the third highest homeowner vacancy rate in the country, at 4.9 percent. It jumped up from 2.8 percent the year before. The national homeowner vacancy rate in 2007 was 2.7 percent...

Other census data shows that the rental vacancy rate here rose from 9.6 to 10.9 percent. The national rate is 9.8 percent. About half of the top 75 metropolitan areas have rental vacancy rates higher than Las Vegas."

http://www.lasvegassun.com/blogs/news/2 ... ow-vacant/

So, the rental vacancy rate in States was 9.8% before the big crash. The home vacancy rates were also high for overbuilt areas. Very different from Vancouver.

I rest my case. So, how are things in Toronto? Any sign of a crash?
 
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Re: CMHC - rents up, vacancy down!

Wed Oct 10, 2012 12:08 pm

So now Vegas = The States? Allrightythen.

If you actually took a moment to look at the US data prior to theory formulation and posting, you'd see that contrary to your claim a 9ish % vacancy rate is pretty typical in the states over the past decade or so. Q2 data (most recent set available) show the following rental vacancy rates:

2012 - 8.6%
2011 - 9.2%
2010 - 10.6%
2009 - 10.6%
2008 - 10.0%
2007 - 9.5%
2006 - 9.6%
2005 - 9.8%
2004 - 10.2%
2003 - 9.6%
2002 - 8.5%
2001 - 8.3%
2000 - 8.0%

(In the 90s a 7.x rate was more typical. In the 80s a 5.x rate was more typical.)

Vacancy rates were slightly elevated as the bubble grew. They continued to climb after the crash. Only now, roughly four years after the bubble peaked/burst are vacancy rates starting to firm up. Maybe. There is just a little data suggesting this, so it could just be a blip.
 
jimtan
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Re: CMHC - rents up, vacancy down!

Wed Oct 10, 2012 1:33 pm

So now Vegas = The States? Allrightythen.

If you actually took a moment to look at the US data prior to theory formulation and posting, you'd see that contrary to your claim a 9ish % vacancy rate is pretty typical in the states over the past decade or so. Q2 data (most recent set available) show the following rental vacancy rates:

2012 - 8.6%
2011 - 9.2%
2010 - 10.6%
2009 - 10.6%
2008 - 10.0%
2007 - 9.5%
2006 - 9.6%
2005 - 9.8%
2004 - 10.2%
2003 - 9.6%
2002 - 8.5%
2001 - 8.3%
2000 - 8.0%

(In the 90s a 7.x rate was more typical. In the 80s a 5.x rate was more typical.)

Vacancy rates were slightly elevated as the bubble grew. They continued to climb after the crash. Only now, roughly four years after the bubble peaked/burst are vacancy rates starting to firm up. Maybe. There is just a little data suggesting this, so it could just be a blip.

Suggest you look at the data. Look hard.

The rental vacancy rate moved up from 8% 2000 to 9.5% in 2007. Suggests that the vacancy rate was terrible in the overbuilt areas. Did those areas crash and burn?

My point is that the States had plenty of empty apartments for those Not Buying. That is not the situation in Canada and Vancouver.

In fact, rents were rising as the vacancy rate returned to the 8% level in 2012.

The rise in home vacancy rate is also significant. Vegas went up from 2.8% 2006 to 4.9% 2007. How are the vacancy rates in Toronto?
 
jimtan
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Re: CMHC - rents up, vacancy down!

Thu Oct 11, 2012 9:26 pm

The rental vacancy rate is critical for market stability. It is the reservior that allows a RE market to sit out short term fluctuations in supply and demand.

A high rate means that there is room for a fall in RE prices. Prospective buyers can just go on a buying strike and sit out the sellers. A low vacancy rate has the opposite effect. Sellers can outlast buyers. We can trace the impact through changes in rent.

Rising rents suggest that prices should be firming. We are seeing that in the States where vacancy rates have dropped while rents rise in popular areas. As a consequence, investors are snapping up properties and prices are firming.

http://www.bloomberg.com/news/2012-10-1 ... gages.html

"Home sales in California’s biggest population centers climbed in August to the highest level since 2006, according to real estate research firm DataQuick. Median house and condominium prices in six Southern California counties jumped 11 percent from a year earlier to $309,000, while values in nine counties in the San Francisco Bay Area gained 11 percent to $410,000, the San Diego-based company said.

“Much of the pickup reflects a continuation of trends we’ve seen for months, like the unleashing of pent-up demand in move-up markets and high levels of cash and investor buying,” DataQuick President John Walsh said in a Sept. 13 statement about the Southern California sales surge. "

After all, it's a good long term investment if you can borrow at 3.5% for thirty years and rents will rise during that time.
 
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jesse1
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Re: CMHC - rents up, vacancy down!

Thu Oct 11, 2012 9:54 pm

it's a good long term investment if you can borrow at 3.5% for thirty years and rents will rise during that time
As long as you don't need to sell. Nobody ever needs to sell except for the ones who need to sell.
There is no shame in overpaying

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