by Mish

For example, an ordinary bungalow on a 44′ by 122′ lot that was “attractively” listed at $3.188 million, spawned a bidding war and sold for $4.19 million.

Inquiring minds may be interest to see what $4.19 million buys in Vancouver.

“Perfect for Families”

The Vancouver Sun reports Vancouver Home Sells for $1 Million Over Asking Price.
The Dunbar area bungalow was listed for $3.188 million and sold earlier this week for $4.19 million.
Just over a month ago, a Point Grey home with a view sold for $1.172 million more than the asking price. The sale price for the house on Bellevue Drive was more than $9 million and the new owner planned to rent it out then tear it down and rebuild in a couple of years, according to the realtor. The house had not been updated.
But the 71-year-old Dunbar house has been fully renovated, according to the MLS listing. It sits on a 44 by 122-foot lot and has a view from the back of the North Shore mountains. The house has a new roof, updated bathrooms and a gourmet kitchen as well as a one-bedroom basement suite.
“Perfect for families,” says the listing. Or, “hold and build.”

What does $9 Million Buy?

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With that “perfect for families” bungalow going for a mere $4.19 million, inquiring minds no doubt wonder what a $9 million teardown looks like.

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It was the view. It is spectacular,” said Park, a realtor with Sutton West Coast Realty.
She said the house was an estate sale and the buyer plans to rent out the place then rebuild within a couple of years.
“The house needs a lot of work — at that price it makes sense to rebuild,” Park said.

Anyone who can make sense out of this is crazy.

That said, I can explain what’s going on: capital flight and desperation to get money out of China, regardless of price.

Mike “Mish” Shedlock

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Here is a quick post under the theme “Housing Bubbles Around The World”. This one is from Norway, courtesy of reader Espen Johansen.

Reader Asks: Can the Bubbles Last Forever?

Reader Bob wants to know if the Fed can keep various bubbles levitated forever. Here is his specific question followed by my response.

Dissecting the Fed-Sponsored Housing Bubble; HPI-CPI Revisited; Real Housing Prices

In the wake of rising housing prices a reader asked if I would revisit my March 2102 article How Far Have Home Prices “Really” Fallen.

Toronto Home Prices Sink Most on Record: Did the Bubble Just Burst?

The three-month average home price in the Toronto area is down a record 14.2% following a flood of new listings and an interest rate hike by the Bank of Canada.

Housing Bubble and Everything Bubble in One Simple Picture

To understand the magnitude of the housing bubbles simply compare the index of wages to the index of prices.

Housing Bubble Comparison: US, UK, Canada, Spain, Australia, Japan

The Economist has a fantastic interactive graphic of housing bubbles over time, shown below. It may take a while to load.

Fed Asset Bubble in Review: Will Falling Equity Prices Trigger a Recession?

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Diving Into the IMF’s Global Housing Update: Bubbles and Busts

The IMF’s Global House Price Index, an average of real house prices across 57 monitored countries, continues to climb.

Asymmetrical Unwind of the Credit Bubble

In How Does One Invest For “Muddle Through”? I talked about unwinding of the credit bubble. Here is the pertinent section: