Friday Free-for-all!

July 31st, 2015

It’s that time of the week again, Friday Free-for-all time!

Lets do our regular end of the week news round up and open topic discussion thread for the weekend, here are a few recent links to kick off the chat:

What’s going on with HCG?
45 brokers falsified income
…for $1billion worth of mortgages
5 booming markets not VAN or TO
Don’t hurt property values!
Do retirees really want to move here?
Shadow lender feast on subprime

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent long weekend!

When it comes to housing affordability Mayor Robertson says that Vancouver is at a breaking point:

 “The conditions and the context keep getting tougher and tougher in Vancouver as the city gets more and more expensive and more desirable to people all over the world to invest in and move into. We’re basically at a breaking point where we need interventions in the market to ensure that people who live and work and grow up here in Vancouver have the opportunity to stay in the city and to keep being part of it and contributing.”

You may recall the Mayor wrote a letter to the BC Premier supporting the idea of speculation tax. The response from the Premier was based around the fact that such a tax would risk driving down house prices.

The Mayor responds to that idea in this interview at the Tyee:

“I think it’s completely wrong. It’s a totally different subject. What we’re talking about is taking some of the profit out of flipping and speculation, which doesn’t have to do necessarily with foreign ownership or homeownership or the value of homes. This is a business activity that’s taking place every day here in Vancouver where there’s a lot of profit, and it’s an option to transfer some of that profit so people can afford to live in the city. They went off on a completely different tangent in their response at the provincial level, and that’s unfortunate. The premier has said that affordable housing in Vancouver is a problem. Well, we need some action to deal with that.”

We’ve seen lots of warnings about dangerously high consumer debt levels in Canada for years now, but here’s something new: Millennials lack of debt may be a sign of trouble.

Insolvency filings by consumers have started to edge higher after a long decline that began after the last recession. As has already been widely noted, the share of insolvencies accounted for by seniors is growing faster than any age group. What has not had much attention is the fact that the young-adult share is falling. Could this be a rare bit of good news for a cohort of the population that has been struggling financially?

Falling insolvencies among young adults definitely sounds good, but every silver lining must have a cloud right?  What’s the chicken-little take on this situation?

Hoyes Michalos recently produced an analysis called Joe Debtor that looked at people who make insolvency filings. The firm says 86 per cent of debtors ages 18 to 29 are working, but their average income is the lowest of all groups at $1,996 on a net basis per month. The average unsecured debt for the group is $32,229, also lowest of all age groups.

Personal loans are the biggest debt component at $11,841 for young adults making insolvency filings, followed by credit cards at $9,858. Almost 30 per cent have student debt, with the average amount owed averaging $3,716.

Their problems in today’s economy may have kept millennials from worse debt problems, Mr. Hoyes suggests. “If you haven’t been able to get a decent job, then it’s a lot more difficult to get into a huge pile of debt.”

In today’s debt-hungry world a lack of bankruptcies is indicative of a low income, how’s that for a bummer?

Friday Free-for-all!

July 24th, 2015

Another beautiful weekend is here!

Who wants gloomy housing news?

This is our regular end of the week news round-up and open topic discussion thread for the weekend, here are a few recent links to kick off the chat:

Canada’s economy: a rough ride
Have more kids and move to BC
Rents in vancouver high or low?
QE in Canada?
Fix Canada with US-made tools?
20% overvalued in Canada
Rennie raises funds for BC Liberals
Secret data?
Ghost town back on market

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

Protect the housing bubble!

July 22nd, 2015

It seem natural that most readers of this site would appreciate an MLA standing up for more data on real estate transactions in BC.

It came after Weaver had introduced a private member’s bill to amend the Land Title Act. If it is approved by a majority of MLAs, it would enable the B.C. government to determine foreign-investment flows in the real-estate market, as well as the extent of corporate buying of property.

Unfortunately in a province where everything seems to revolve around real estate and sensitivities around that topic what you end up with is wishy-washy comments that are nonsensical.

Southseacompany points out that Green MLA Andrew Weaver has asked the finance minister what is being done to prevent a Vancouver housing bubble from bursting.  Unfortunately there appears to be some logical inconsistencies in the MLAs statements:

I especially can’t figure that first sentence on Weaver’s blog;

“Today in the legislature I rose to question the Minister of Finance as to what steps, if any, government is taking to ensure that Metro Vancouver’s potential housing bubble doesn’t burst and that housing remains affordable in the region.”

Remains affordable? And that if this bubble burst and prices fell, then… it won’t be affordable??

This man’s nonsense is a waste of time.

 

Food for Bulls

July 21st, 2015

No matter how insane the Vancouver housing market gets, don’t take too much comfort in the fact that it can’t get crazier.  For all the logical arguments and reasoning, those who are negative on the price of Vancouver real estate have been more wrong than right for years.

Ulsterman points out one take on this situation:

I just renewed the rental on my $1.2m rental SFU for 2k/month. I great deal no doubt. But i’m dealing with a wife and three kids. My very patient wife would of course like to make changes and modify her nest. I mean, all her friends are doing it. I’m actually surprised I’ve managed to to suppress the mutiny thus far. Yes honey, just wait, the price correction is JUST around the corner. Every year we wait in nervous anticipation to know if we will be uprooting the family to search out another home.

If you have a family rental living is just a pain in the arse. Buying in 2005 or so and just getting the fuck on with your life would have been the best choice. And don’t think to yourself, “well duh, of course i’d have bought in 2005!” Back then, the people who read these blogs were the people who didn’t buy because they already thought there was a bubble. It’s really easy to look back now and say if only i’d had a downpayment back then i’d have bought. You probably wouldn’t have because you’d have been reading stuff like this and thinking a bubble was forming.

If you are a new bear out there, take no comfort reading these blogs. You could still be reading them 10 years from now. Seriously.

Read the rest of the comment here.

Sure, condos haven’t done so great in the last half decade, but detached homes keep going up and up.  At what point does this market affect your major life decisions? Do you capitulate and buy what you can, keep renting or are you considering a move away from the metro area?

Friday Free-for-all!

July 17th, 2015

It’s that time of the week again!

Friday Free-f0r-all time!

This is our regular end of the week news round up and open topic discussion thread for the weekend. Here are a few recent links to kick off the chat:

Some bears cash in on HCG drop
BOC has lost its mojo
The future of the CAD?
Realtor vs Realtor: How stupid are you?
Planning to leave?
Will she or won’t she?

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

The Bank of Canada took another strike at driving down the Canadian dollar and cut the key interest rate by .25% to a slender .50%.

Canada’s central banker isn’t using the R-word – recession — but Stephen Poloz is cutting the Bank of Canada’s key interest rate by 25 basis points to 0.5 percent as he forecasts two back-to-back quarters of economic decline amid the crash in crude prices.

With Canadians carrying record-high debt loads and cheap money fuelling hot housing markets in Toronto and Vancouver, the 25 basis point rate cut will be seen as a risky play in some quarters, adding more fuel to the debt fire.

Read the full article over at BNN.

Friday Free-for-all!

July 10th, 2015

It’s the end of another glorious work-week and you know what that means here on VCI?

It’s Friday Free-for-all time!

This is our standard end of the week news round up and open topic discussion thread for the weekend, here are a few recent links to kick off the chat:

another rate cut?
different here
frustration over empty luxury
shield against mortgage meltdown?
developers aim for senior market

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

Channel 4 in London has done an experiment on estate agent reactions to potential buyers using obviously ill-gotten gains. The results were predictable:

In a documentary called From Russia With Cash, to be broadcast on Wednesday, two undercover reporters pose as an unscrupulous Russian government official called “Boris” and his mistress “Nastya” whom he wants to purchase an upmarket property in London for.

The couple – Russian anti-corruption campaigner Roman Borisovich and Ukrainian investigative reporter Natalia Sedletska – view five properties ranging in price from £3m to £15m, on the market with five different west London agents, in Kensington, Chelsea and Notting Hill.

Despite being made aware they are dealing with ill-gotten gains, the estate agents agree to continue with a potential purchase. In several instances the estate agents recommend law firms to help a buyer hide his identity.

One estate agent names a “very, very good lawyer … the last person I put them was another minister of a previous Soviet state” in a deal worth £10m.

The estate agents suggest that in the capital secretive purchases of multimillion pound houses are common. One claims that 80% or more of his transactions are with international, overseas-based buyers and “50 or 60%” of them are conducted in “various stages of anonymity … whether it be through a company or an offshore trust”.

Read the full article here.

VCI Network

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