Real Estate

Vancouver housing bubble?

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Deal Addict
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Dec 14, 2007
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choclover wrote: Thanks for confirming. It was my feeling too that it could not be done but I am not a technical person, just someone who knows that the people involved are not trying to make this easy. I tried calling BC Assessment about finding specific data for a different purpose and you wouldn't believe the response I got. Something along the lines of "...it would be really complicated and difficult but we might be able to put something together. But it would cost you quite a bit." Are you kidding me? Isn't all the information in databases so it can be queried? I don't think the people running the government know what they are talking about. Although I am sure they have the "Ferrari" quality hardware and software at the expense of us taxpayers. Sheesh.
Oh it's COMPLETELY possible and super easy if you are legally allowed to have access to the data... I know at least on web developer in Toronto built databases that did similar things scraping data and were served with cease and desist letters from the TREB.
I'd love to write history... in advance.
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I'm not in opposition to those thoughts. I actually agree with what you're saying.

It's just the irony of combating runaway living accommodation costs, doing this just made wealthy higher-end land owners (non-working participants in the local economy) more wealthy.

Michelle Wu has bought and held hundreds of houses in Vancouver - - offerring owners 30% more and then selling to developers for 300% of their original value. She has made $100+ million out of Vancouver's outdated land strategies. The empty home tax doesn't bother her too much while she flips blocks of houses.

This new zoning law won't increase density for 3+ years while serving to immediately increase land values.

Yes, this should have been implemented 10 years ago.

Yes, more of all kinds of housing - - 3 story apartment rentals with stairs for example. Cheap to build a maximizes land use.

More (ANY?) row houses, townhouses (families don't like townhouses facing 6-lane streets), rentals, coop rentals, etc.

10 years behind on everything while Vancouver's mayor focused on downtown high-end condos, bike sharing, greening, and bike lanes.

Well, I do slightly disagree with one thing you said. Vancouver isn't a world class city in the same sense as Tokyo, etc.

They have strong economic engines. Have you been there to witness their working culture? Vancouver = Tokyo?? Not even close.

Toronto is closer to a world class city - multiple industries, huge variety of jobs, etc. Vancouver's business economy (outside of real estate) is a joke when compared to truly world class cities.

Most people don't live and work in Vancouver because it's the greatest place to earn income - unless you're a wealthy foreign real estate "investor", developer, contractor, etc. Vancouver generally has one primary industry that's thriving at the moment. If it ever does crash, and I'm not sure it ever will, it will be devastating to the local economy.

Vancouver is no world class economic city. It's a cleaner place, with great natural beauty, etc. Most people don't move here to get rich - - though many move here that became rich.

BC = Bring Cash
atomiton wrote: I would tend to disagree... I think duplexes are a better solution than laneway homes. Laneway home artificially have turned SFHs into mini-fiefdom... or essentially mini apartments. Duplexes are a step in the right direction... and it will provide a little bit more variety in housing stock... which is a good thing.

Right now, if you want anything that will fit a 2+2 family, you have two choices... move out to Cloverdale/Langley and buy a SFH in one of those new 25' lot development... or buy a 1.5M house and rent out one legal suite, and one illegal suite... and built a laneway house while you're at it.

We have no variety. Go to a truly world-class city like Tokyo and you see a massive variety in housing stock... mostly because zoning handled mostly on the national level and there are fewer rules as to what you can built, apart from sunlight rules which limit blocking sunlight from neighboring houses. And it's amazingly livable. A few steps off a main street and you're in a quiet residential neighborhood of SFHs in the middle of the city. As such, you can live in a small SFH in downtown Tokyo and sacrifice a yard... or move out to a 1hr commute and get some dirt.

Personally, I'd make it possible to sell a laneway home separately... I know there would be complications with this, but it offers a less expensive alternative to people who don't want to become apartment managers just to be able to live in a SFH. Let's be honest... VERY few people who live in a SFH are living in much more than 1100 sq. ft. of it.... as they rent out the bottom level ( with at least one legal suite, and usually 1 illegal one ). So... why are these places even ZONED for SFHs? They're NOT. People aren't having 3–4 kids any more... and even when they did, were making do with a 1-story rancher and an unfinished basement... though more and more are supporting aging parents later on... so that's a consideration.

Allow houses to be built closer to the street, getting rid of the mostly useless front yard and allow people to own a house the size in which they'll actually LIVE in. Row housing COULD work... but what ALSO could work is narrower 22' lot sizes. A developer buys up 2 lots with the ability to subdivide it into 3 separate SFHs. A three level 22' lot can easily accomodate a SFH, and even with a small MIL-suite. You could take 2 lots and if you built closer to the street built 6 of these... front and back... with a small area in the front of each place for 1 or 2 cars.
Deal Guru
Jan 27, 2006
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Vancouver, BC
RxMills wrote: Absolutely.

I hope Vancouver's electorate sees it too. I wish he was running again. so he could get a reality-check on his effectiveness.

It's as though the existing mayor (just a few months left) wants to reward existing land and estate owners while appearing to provide "more affordable" homes.

Coming soon... 100sf micro-condos and apts.

Many longterm Point Grey, Shaughnessy and Kerrisdale owners say their neighbours are almost never there - - while statistically becoming some of the "poorist" neighbourhoods according to the CRA (high wealth, low/no income).

Well, now those neighbour's investments will be worth even more - - and Mayor Gregor Robertson will be appointed to a Director of a large corporation.
The existing Vision 'team' isn't looking to reward existing land/estate owners as it doesn't really matter to the existing land/estate owners. What they seem like they are trying to do is to set it up so developers/builders will get a boom in their work as a portion of the existing single family housing stock gets torn down and rebuilt as duplexes which may set up positions within those developers/builders for former Vision team members.
Deal Guru
Jan 27, 2006
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i6s1 wrote: Duplexes will reduce rental scarcity. This will drive rental prices down (more realistically prevent/slow increases.) With reduced rental rates, it might not make sense for an "investor" (speculator) to own and rent out an SFD. This puts those SFDs back on the market.

To look broadly, anytime you increase the supply and ignore other factors, you're going to reduce costs. If the overall market is depressed slightly by the greater supply, it might not matter that SFDs are slightly more.

The rise in duplexable SFD properties will only happen because those properties become more valuable relative to other property types. Other comparable property types will drop.
Adding duplexes should increase rental stock but that increase will come at least two to three years down the road and it will be slow. A better idea would be to create rental apartments towers if you want to increase rental stock quickly.
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RxMills wrote: I'm not in opposition to those thoughts. I actually agree with what you're saying.

It's just the irony of combating runaway living accommodation costs, doing this just made wealthy higher-end land owners (non-working participants in the local economy) more wealthy.

Michelle Wu has bought and held hundreds of houses in Vancouver - - offerring owners 30% more and then selling to developers for 300% of their original value. She has made $100+ million out of Vancouver's outdated land strategies. The empty home tax doesn't bother her too much while she flips blocks of houses.
Great points
Well, I do slightly disagree with one thing you said. Vancouver isn't a world class city in the same sense as Tokyo, etc.

They have strong economic engines. Have you been there to witness their working culture? Vancouver = Tokyo?? Not even close.
Totally agree here, actually. I've always thought Vancouverites ( and BCers ) have an over-inflated view of themselves... slogans like "Best Place on Earth" didn't help. This lack of humility has meant that more and more Vancouverites just assume that Vancouver is expensive because we're the best... which just isn't true. It also means that locals blame outsiders for all their woes... so instead of attack the problem, they point outward and try to blame outsiders.
Toronto is closer to a world class city - multiple industries, huge variety of jobs, etc. Vancouver's business economy (outside of real estate) is a joke when compared to truly world class cities.
Agreed.
Most people don't live and work in Vancouver because it's the greatest place to earn income - unless you're a wealthy foreign real estate "investor", developer, contractor, etc. Vancouver generally has one primary industry that's thriving at the moment. If it ever does crash, and I'm not sure it ever will, it will be devastating to the local economy.

Vancouver is no world class economic city. It's a cleaner place, with great natural beauty, etc. Most people don't move here to get rich - - though many move here that became rich.

BC = Bring Cash
I'll add to this point... Vancouver has one big thing going from it from a Canadian perspective. Temperate weather from the perspective of Canadians. Note... it's relative. Many find the temperature in Vancouver too cold in the summer... not a REAL summer... and not a proper winter either... just lots of dampness.... so really the weather isn't that great, although Vancouverites like to brag about the lack of snow in the winter.

When it comes to real estate, I think there are some similarities to Hong Kong. This is a fascinating video about Hong Kong and its high real estate prices.


One of thing it mentions is that Hong Kong's prices are NOT do with land scarcity, but rather land policy. While Vancouver doesn't have the same issues, it's hard not see how things like Land Transfer Tax and development extras like parks haven't done their part to grease the wheels of political parties... In other words, the governments have been able to claim lower taxes because they haven't had to build infrastructure... leaving developers to do that. In some senses, it's a win-win... but in other senses, money for those amenities come from somewhere...

For houses, land value has gone up because government has been unwilling to rezone SFHs into MFDs like low-rise apartments... or smaller lot sizes. Why on earth does Cloverdale have narrow lot sizes ( 25' ) on new development? Because the "mortgage-helper" culture isn't as strong or as accepted in those areas... people buy a place because they want to live in it... not share it with someone else. A single car garage with a space for another car. There's no reason for the majority of Vancouver's houses to be on 33–50' lots. Developers should be given a lack of red tape to redivide those lots into smaller more useful parcels... and not necessarily apartments.

Look at the area around Strathcona? Imagine if we had more of that kind of housing around? Sure, there are run-down hosues in that area, but also some very creative narrow buildings designed for one family... and SFHs a stone's throw from downtown... that are NOT condos or high-rises. Crazy.... More of that please!
I'd love to write history... in advance.
AMEX Biz Plat 75K AGAIN! | Plat 60K | Biz Gold 40K | Gold 25K | SPG 20K
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Apr 10, 2011
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Just wanted to say thanks to the amazing recent posts. You guys understand the big picture. I wish you'd all get together and form a municipal political party.

Run on one issue... the housing situation.
Sr. Member
Sep 9, 2014
572 posts
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Vancouver
atomiton wrote: I would tend to disagree... I think duplexes are a better solution than laneway homes. Laneway home artificially have turned SFHs into mini-fiefdom... or essentially mini apartments. Duplexes are a step in the right direction... and it will provide a little bit more variety in housing stock... which is a good thing.

Right now, if you want anything that will fit a 2+2 family, you have two choices... move out to Cloverdale/Langley and buy a SFH in one of those new 25' lot development... or buy a 1.5M house and rent out one legal suite, and one illegal suite... and built a laneway house while you're at it.

We have no variety. Go to a truly world-class city like Tokyo and you see a massive variety in housing stock... mostly because zoning handled mostly on the national level and there are fewer rules as to what you can built, apart from sunlight rules which limit blocking sunlight from neighboring houses. And it's amazingly livable. A few steps off a main street and you're in a quiet residential neighborhood of SFHs in the middle of the city. As such, you can live in a small SFH in downtown Tokyo and sacrifice a yard... or move out to a 1hr commute and get some dirt.

Personally, I'd make it possible to sell a laneway home separately... I know there would be complications with this, but it offers a less expensive alternative to people who don't want to become apartment managers just to be able to live in a SFH. Let's be honest... VERY few people who live in a SFH are living in much more than 1100 sq. ft. of it.... as they rent out the bottom level ( with at least one legal suite, and usually 1 illegal one ). So... why are these places even ZONED for SFHs? They're NOT. People aren't having 3–4 kids any more... and even when they did, were making do with a 1-story rancher and an unfinished basement... though more and more are supporting aging parents later on... so that's a consideration.

Allow houses to be built closer to the street, getting rid of the mostly useless front yard and allow people to own a house the size in which they'll actually LIVE in. Row housing COULD work... but what ALSO could work is narrower 22' lot sizes. A developer buys up 2 lots with the ability to subdivide it into 3 separate SFHs. A three level 22' lot can easily accomodate a SFH, and even with a small MIL-suite. You could take 2 lots and if you built closer to the street built 6 of these... front and back... with a small area in the front of each place for 1 or 2 cars.
Very true. I bought a duplex last year. We looked at single detached with rental suites but then realized the living square footage we'd have for ourselves was often less than a duplex (or fewer bathrooms). Plus the extra risk, tenant, etc.

Duplexes don't densify a ton but they allow two full families to live on one lot. A normal regular family won't rent out a laneway house! Or a basement suite. Front/back duplexes also make better use of the space in the front (since as you said, it's usually useless otherwise.)
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Jan 14, 2009
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atomiton wrote: Great points

Totally agree here, actually. I've always thought Vancouverites ( and BCers ) have an over-inflated view of themselves... slogans like "Best Place on Earth" didn't help. This lack of humility has meant that more and more Vancouverites just assume that Vancouver is expensive because we're the best... which just isn't true. It also means that locals blame outsiders for all their woes... so instead of attack the problem, they point outward and try to blame outsiders.


Agreed.

I'll add to this point... Vancouver has one big thing going from it from a Canadian perspective. Temperate weather from the perspective of Canadians. Note... it's relative. Many find the temperature in Vancouver too cold in the summer... not a REAL summer... and not a proper winter either... just lots of dampness.... so really the weather isn't that great, although Vancouverites like to brag about the lack of snow in the winter.

When it comes to real estate, I think there are some similarities to Hong Kong. This is a fascinating video about Hong Kong and its high real estate prices.

One of thing it mentions is that Hong Kong's prices are NOT do with land scarcity, but rather land policy. While Vancouver doesn't have the same issues, it's hard not see how things like Land Transfer Tax and development extras like parks haven't done their part to grease the wheels of political parties... In other words, the governments have been able to claim lower taxes because they haven't had to build infrastructure... leaving developers to do that. In some senses, it's a win-win... but in other senses, money for those amenities come from somewhere...

For houses, land value has gone up because government has been unwilling to rezone SFHs into MFDs like low-rise apartments... or smaller lot sizes. Why on earth does Cloverdale have narrow lot sizes ( 25' ) on new development? Because the "mortgage-helper" culture isn't as strong or as accepted in those areas... people buy a place because they want to live in it... not share it with someone else. A single car garage with a space for another car. There's no reason for the majority of Vancouver's houses to be on 33–50' lots. Developers should be given a lack of red tape to redivide those lots into smaller more useful parcels... and not necessarily apartments.

Look at the area around Strathcona? Imagine if we had more of that kind of housing around? Sure, there are run-down hosues in that area, but also some very creative narrow buildings designed for one family... and SFHs a stone's throw from downtown... that are NOT condos or high-rises. Crazy.... More of that please!
Good points and well put. There will always be people who will oppose densification so they prefer to blame foreign demand instead. Even people who do not live in the high demand neighborhoods oppose rezoning because they do not want high density when they finally move in. Many are not willing to abandon the dream of owning a big house on a wide lot. With that said, we are making progress with density in high demand areas like Oakridge/Cambie, Marpole, Metrotown, and Brentwood. Oakridge has more row townhouse types and low rise condos while Burnaby is going with taller condo towers so we are getting more choices than before.

Government taxing development to fund local infrastructure and amenities is fine if we build more density. The community amenities contribution (CAC) costs becomes more affordable on a per unit basis when there are more units. The problem right now is that the CAC cost is becoming too expensive on a per unit basis for potential buyers. When the CAC cost for the development of a piece of land in a modest neighbourhood is $16 million, developers have no choice but to build a condo tower to reduce the per unit cost.
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Dec 27, 2006
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https://www.bloomberg.com/amp/news/arti ... -clampdown?

Foreigners Not Welcome as Malaysia Joins Property Clampdown
Emily CadmanAugust 28, 2018, 8:41 PM EDT

Housing affordability has driven restrictions around the world

Hanging a ‘foreigners not welcome’ sign on a giant real estate development, Malaysia’s prime minister this week appeared to add to housing curbs around the world fueled by soaring home prices and populist politics.

Describing the Chinese-backed $100 billion Forest City as “built for foreigners” and beyond the reach of ordinary Malaysians, Mahathir Mohamad tapped into the nationalist rhetoric that helped secure him an election victory -- and global angst over housing affordability. Around the world, post-financial crisis property booms driven by low interest rates have left locals struggling to buy homes.

“The tension around foreign investment is always going to be much more acute when affordability is getting worse,” said Brendan Coates, a researcher in Melbourne at the Grattan Institute think tank. When locals get “priced out of the market,” foreign buyers may be blamed even when their effect is small, he said, commenting on the global picture.

Read more: No Chinese belt, road or bedrooms for Malaysia

A wave of restrictions or taxes on foreign purchases already stretches from Sydney to Hong Kong to Vancouver. Measures targeting foreign home buyers have included stamp duties, restrictions on property pre-sales to non-residents and limits on the types of homes that can be purchased.

‘New Colonialism’

New Zealand is banning foreigners from buying existing residential properties after Prime Minister Jacinda Ardern campaigned in last year’s election on pledges including affordable housing. Canada and Australia have rolled out one restriction after another, and Singapore just ramped up a tax on overseas buyers. Denmark and Switzerland have restrictions, a Grattan report shows.

The 93-year-old Mahathir’s comments came at a late stage of the game. Globally, property shows signs of cooling from the post-crisis boom. His concern seems to be sparked not by property market overheating but, rather, foreign investments that don’t benefit Malaysia and what he terms the risk of “a new version of colonialism.”

Late Tuesday, a statement from Mahathir’s office said the nation welcomes all tourists, including from China, as well as foreign direct investment that “contributes to the transfer of technology, provides employment for locals and the setting up of industries.” It didn’t refer to Forest City.

A model of the Forest City development.
Photographer: Ore Huiying/Bloomberg
“Mahathir has never liked the idea of Forest City or the idea of many foreigners buying up property in Malaysia,” said Ryan Khoo, co-founder of Alpha Marketing Pte Ltd., a Singapore-based real estate consultancy.

Foreigners will be blocked from buying units at the project, on artificial islands in Johor, and refused visas to live there, Mahathir said at a press briefing on Monday. That left analysts and local officials parsing his words to guess at how bans might work. The Chinese developer, Country Garden Holdings Co., said his comments clashed with past assurances. The project’s targeted buyers have included people in mainland China.

With a wall of Chinese money blamed for pushing up prices around the world, local lawmakers, media and the public can struggle to disentangle xenophobia from legitimate efforts to constrain inflows of capital. In Australia, “populist reporting” exaggerated the role of Chinese investors, according to Hans Hendrischke, a professor of Chinese business and management at the University of Sydney.

Read more on global property:

Cracks Show in Property Markets From Sydney to New York
New Zealand to Crack Down on Foreign Home Buyers
Mahathir Bans Foreigners From $100 Billion Property Project
Singapore Curbs May Hit Luxury Property The Hardest
In World’s Most Livable Cities, Few Can Afford to Buy a Home
Chinese buyers had the “bad luck” of becoming overly visible in markets around the globe, said Carrie Law, chief executive officer of Juwai.com, a Chinese international property website.

Foreign buyers get blamed for soaring home costs even when the evidence is minimal. More than 60 percent of Sydney residents cite foreign investment for price increases, according to a survey from University of Sydney academic Dallas Rogers. That’s despite research by Australia’s Treasury showing only a marginal impact. Likewise, data suggest foreign buyers play only a small role in New Zealand’s housing market.

(Updates with Mahathir statement in seventh paragraph, chart on global restrictions.)
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Oct 7, 2007
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Funny how we can't even talk about banning foreign money in Canada without being accused of being racist. Meanwhile, countries all over the world are taking measures to protect their locals. Where do we think the money is going to go if there are so many restrictions everywhere else but none here? And is this going to be making housing more or less affordable for locals?
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Jul 14, 2002
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Interesting, didn't think that Malaysia was going to setup laws for foreign buyers. Love the food there.
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Jan 14, 2009
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choclover wrote: Funny how we can't even talk about banning foreign money in Canada without being accused of being racist. Meanwhile, countries all over the world are taking measures to protect their locals. Where do we think the money is going to go if there are so many restrictions everywhere else but none here? And is this going to be making housing more or less affordable for locals?
The issue is very complex and both side just rely on rhetoric. Hong Kong has taken a lot of measures to restrict real estate purchasing and it has not helped with affordability. Why is that? Hong Kong finances itself with land leases and it looks like Vancouver is going down the same path. Land taxes by itself is not a bad thing if you value government provided services. The easiest and most efficient way for Vancouver to capture foreign (and domestic!) funds is through real estate. Using real estate to finance government spending creates an incentive for government to protect land value. It will also create an artificial price floor on real estate. Banning foreign money will reduce government income. If we do not rely on foreign money, we would have to rely on local savings and local income to finance government services. Or we could try to attract FAANG jobs but if get too many FAANG jobs that would attract skilled foreign and out of province workers. This would create affordability issues seen in other tech hub cities so we are back to banning foreign workers or something. Then the FAANG companies will complain and leave.

We do have some demand curbing measures like FBT and "speculation" tax and that has driven volume to historic lows. But we will have to wait and see if it will help with vacancy rates which ultimately drive prices and affordability. We can ban foreigners but we can't ban foreigners from becoming locals. Canada has 37 million people now. It seemed like yesterday when it was in the 20 millions.
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Oct 7, 2007
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zakarydoks wrote: The issue is very complex and both side just rely on rhetoric. Hong Kong has taken a lot of measures to restrict real estate purchasing and it has not helped with affordability. Why is that? Hong Kong finances itself with land leases and it looks like Vancouver is going down the same path. Land taxes by itself is not a bad thing if you value government provided services. The easiest and most efficient way for Vancouver to capture foreign (and domestic!) funds is through real estate. Using real estate to finance government spending creates an incentive for government to protect land value. It will also create an artificial price floor on real estate. Banning foreign money will reduce government income. If we do not rely on foreign money, we would have to rely on local savings and local income to finance government services. Or we could try to attract FAANG jobs but if get too many FAANG jobs that would attract skilled foreign and out of province workers. This would create affordability issues seen in other tech hub cities so we are back to banning foreign workers or something. Then the FAANG companies will complain and leave.

We do have some demand curbing measures like FBT and "speculation" tax and that has driven volume to historic lows. But we will have to wait and see if it will help with vacancy rates which ultimately drive prices and affordability. We can ban foreigners but we can't ban foreigners from becoming locals. Canada has 37 million people now. It seemed like yesterday when it was in the 20 millions.
Maybe it is time for us to stop trying to "get rich quick" either as individuals or as a government and start working towards building a diversified and sustained economy through jobs that produce value-added goods and services. The sooner we get started, the sooner we can reach a prosperous economy. Instead the government continues to help people sell themselves out with the end result that we will eventually all be homeless and poor and some other country will be making our destiny for us. I would like to believe that we are not so entirely hopeless that we cannot do better than merely survive as an economy.
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choclover wrote: Maybe it is time for us to stop trying to "get rich quick" either as individuals or as a government and start working towards building a diversified and sustained economy through jobs that produce value-added goods and services. The sooner we get started, the sooner we can reach a prosperous economy. Instead the government continues to help people sell themselves out with the end result that we will eventually all be homeless and poor and some other country will be making our destiny for us. I would like to believe that we are not so entirely hopeless that we cannot do better than merely survive as an economy.
Short-term gain for long-term pain... Whenever there's big money involved, efficient use of space, resources, and assets is rarely a priority.
I'd love to write history... in advance.
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