Sunday, March 01, 2009

In Derrick Penner's Shoes

The Vancouver Sun published an interesting discussion between so-called real estate experts with Sun reporter Derrick Penner asking the questions.

"The Sun invited to its editorial offices a panel of experts in Polygon Homes chairman Michael Audain, top realtor Patsy Hui with Re/Max Westcoast, and Tsur Somerville, director of the centre for urban economics and real estate at the Sauder School of Business at the University of British Columbia."

Here are the questions I would have asked if I were in Derrick Penner's shoes:

1) Please tell me how you each earn a paycheque? Do you feel how you earn your money helps you have an unbiased opinion on real estate matters?

2) What makes you a real estate expert? What are your qualifications?

3) Why should the Sun's readers heed your advice? Do you actually have any advice? What is in it for our readers? What's in it for you?

4) What would you say to someone who felt that prices of homes in the Vancouver area were destined to fall another 20-30% from current levels? What would you advise people to do if that were the case?

5) Where do you feel future buyers of real estate will come from since population growth is at historically low levels and the ownership rate has risen dramatically in the past 15 years? How will prices rise if there are fewer buyers than sellers?

What would you have asked if you were in Derrick Penner's shoes?


patriotz said...

6. What were you predicting a year ago? If what you were saying a year ago was wrong, why should anyone take you seriously today?

johnnyrent said...

Mr. Penner was not the moderator of a round table. He was the axis point for a circle jerk.

At some point one hopes for some real journalism, where the kind of questions you posed would be asked, and where the reporter had done some due diligence, such that he or she could challenge those answers that were long on rhetoric, short on rationale.

It would seem that we're not ever going to get a legitimate journalistic take on our RE market from the Sun. That's why there are blogs like this one, where intelligent debate and reasoned perspectives can be aired.

patriotz said...

What's the difference between the Vancouver Sun and the Real Estate Weekly?

The Real Estate Weekly is free.

mohican said...

I hope Derrick Penner and his boss read this blog as a criticism of not just one blogger but a criticism from a wide swath of the population who may be inclined to read papers if there were genuine journalism taking place.

markoz said...

Patriotz - love both your comments! I did NOT love Patsy Hui. Complaining her 30 year old couldn't afford rent while spouting about how affordable buying real estate is. Barely pulling back from saying all the poor people should be shuffled off to Surrey. When questioned on social housing: "The people that are really rich don't want to live with a whole bunch of … excuse me for saying, I'm not being … " She then goes on to talk about people who paid $800K not wanting to live with people who paid $400K for the same thing. WTF? $400K social housing? Rubbing elbows with the impecunious flotsam only able to pay $400K for a condo? "The Sun" wouldn't publish my comment. (Even though I refrained from using WTF in the post...)

Mr. Tall Dark and Single said...

Thanks for posting this! I have been saying the Vancouver media is brutal for some time now!

jesse said...

The debate between Audain and Somerville near the end was interesting. I don't always agree with Dr. Somerville but we did call out Audain on a few dumb comments.

One good point raised by Sommerville, IMO, was how to properly set owner's equivalent rent for properties without much in the way of rentals available to properly compare. I think that's a very worthy question and I'd love to hear thoughts of readers here on the subject.

patriotz said...

Irrelevant. Sure there may be some properties such as waterfront which do not have a transparent rental market, but such properties are not the ones which people making rent versus buy decisions would consider in the first place.

For everything else, including all classes of condos and just about all SFH, there is a large - and expending - rental market.

BTW the Sun/REW joke is an oldie and I can't take credit for it.

condohype said...

I like that this was done as a lengthy interview. It gives everyone room to hang themselves with their own words. The realtor's comments are something else. I did a double-take when she blames the Sun for negative headlines. Notice the photo at the beginning of the interview? The so-called negative headline comes from the BC Real Estate Association's forecast of 13% price declines in 2009. "Why wouldn't you buy?" the realtor asks. How hilarious.

Gee, why wouldn't I buy into a depreciating, cash-flow negative investment? On a related note, how is it possible to have a 6,000-word discussion about real estate and no one brings up price-to-rent ratios?

Given the editorial limits of the Sun's real estate coverage, I thought Tsur Somerville came off as reasonably critical. He at least flags concerns like the exit of speculators and the non-factor that is the Olympics. For those looking for critical opinion in the Sun, this is as close as you're gonna get.

jesse said...

"For everything else, including all classes of condos and just about all SFH, there is a large - and expending - rental market."

For condos it is easy to find equivalent rentals. Detached tends to be more difficult to find direct comparisons. Checking out Craigslist, however, does offer some clues but in nowhere near the volume for condos. The lack of rentals in many neighbourhoods makes us more uncertain what actual rents would be, due to the lower sample size.

Octagonian said...

I would ask the Sun how long they think they will exist as an independent entity to continue snowing consumers with their pseudo-economic pap and propagandizing for prolapsed industries. Who have also run out of money.

Octagonian said...

I might also ask, 'Do you really believe EVERYBODY has forgotten that Tsur Sommerville was a Real Estate fluffer and apologist before you provided him a platform to pretend he is now a critic, long after the proverbial cattle have fled?

HouseHuntVictoria said...

Best PH quote in the article: "In rental property … rents have come down, by the way, a two-bedroom in Richmond, 800 sq-ft is $1,530. I just leased one … That came down from $1,800. I leased out a 15th floor for $1,530. Six months ago, when it was brand new, they leased out for $1,800. Same place, lower floor. So rents have come down"

15% drop in "rents." Sure PH. Sure. Maybe you were asking too much to begin with?

Even if it's true. It simply means prices have further to fall now.