Uncategorized

Friday Free-for-all!

76
76 Comments

Lost track of time, I’ll add some story links later.. In the meanwhile, feel free to add your own in the comments section below!

We’re back! Had to take advantage of the sunlight while it’s here. A few interesting recent stories and links:

–Days of rock-bottom interest rates are numbered
–Inflation hotter than expected
–Downtown Vancouver listings soaring in 2010
–Calgarians sell before expected price decreases
–If it didn’t work in the US, try it in Canada
–Class action lawsuit against Jurock and partners
–Elusive Canadian housing bubble (PDF)
–US homeowners who get aid angry over low credit scores

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

76 Comments
newest
oldest most voted
Inline Feedbacks
View all comments
Starving Artist

"As you say, it’s a major issue in Vancouver and Toronto but less of a problem in many other major cities."

We have many other major cities?

0
0
chip

@patriotz:

"My point, which you missed completely, is that the reporter was taking the opposite stand with respect to the banking industry (i.e. calling them the good guys) as McQuaig would."

Actually I wasn't addressing your point, and wasn't even sure what it was when I posted. I was just alluding to the connection between two lousy journalists.

And as for calling the bankers the good guys, a quick look at the story shows that the NYT reporter only thinks that in the sense that they were cowed by the regulators. So if anything he thinks the regulators were the good guys, not the bankers, and this is certainly something that would make his pal Linda happy.

0
0
arit

US realtor ™ in trouble: "…homeowners trying to do the right thing by doing a short sale would end up exposed to further problems whereas a homeowner who just says, “I’m not even going to try to sell my home and work with the bank” gets protection. It doesn’t seem right. However, it’s the law." It can even happen to people who got their bank to approve them selling their home for less than it is worth. Vanessa Corey, for example, short sold her Fredericksburg, Va., home in April 2008. She and her husband built the house in 2004, but setbacks, both personal (divorce) and professional (housing bust), made it impossible for the real estate agent to keep her home. So she negotiated the short sale and thought that was the end of it. “My understanding was that the deficiency… Read more »

0
0
Mark Downs

@Chiones: While between 1980 and 1983 we did see some homes drop almost 50 per cent, I do not think Vancouverites will ever witness what has happened in Phoenix.

Did I read that right? Did he manage to say in a single sentence that Vancouver has seen almost 50% house price drops like Phoenix, but he doesn't think we'll ever see almost 50% house price drops like Phoenix?

Far out man! I'd like some of what he's smoking (since he obviously has enough to share with the editor).

0
0
Wreckonomics

@Derek: Ouch. His response is an ill-informed as the article. Thanks for sharing that. I can't believe he took the time to link to a source which he clearly doesn't understand. He seems to think that the new mortgage rules remove 5% / 35 year mortgages, which of course they do not.

He did write back to you fast, but perhaps he should spend more time researching what he writes and less time responding to people correcting his lack of research.

0
0
ReductiMat

@other ted:

"Americans are pro business and are able to cut their losses no matter how painful."

Not anymore.

Four words, "Too Big To Fail".

0
0
!(EconomicsDegree)

Geller ran for the NPA during civic elections. Wonder if he'll run again…

0
0
rubberduckie

Wow, there were a LOT of Open House signs out today.

I wonder how many squealing little Last Time Buyers are writing up offers tonight?

0
0
other ted

60, chiones I do agree we will see drops but not as big as phoenix. but differnt reasoning. I don't think our banks are what will keep it from falling or the lack of land lie which has been disprovan. The only difference between canadaians and americans is mentality. Americans are pro business and are able to cut their losses no matter how painful. americans realize they can cut their losses and put their money better to use somewhere else. Where are canadians going to put their money. They have no idea what a business is. Someone on this blog once described vancouver with having a company town mentality and they are right. Without real estate the vast majority are clueless as how to start a business or invest. There will be a crash but unfortunately money will go back… Read more »

0
0
Dave

@patriotz:

From what I recall, Mike is retired, or as retired as somebody with his background and experience becomes.

Mike worked for years at SFU for a non-profit development. All monies went to the SFU trust. I believe that trust is up to $25 million to date. It will probably create $100 million for the University by the time the development is done.

He created one of the greenist, if not the greenist, development in the Lower Mainland. UniverCity was a leader in innovative development and it is a great model for the future. It has proven itself out to work. And Mike deserves a lot of that credit.

Hardly a hack. More like a good role model.

0
0
Derek

I wrote to the guy from the New York times and he actually replied: Thanks for writing.My reporting found that chartered banks have not been offering five percent down, 35 year mortgages with rare exceptions since 2008, even with insurance from CMHC or its competitors. And, of course, mortgage underwriters won't be able to do that beginnning next month :http://www.fin.gc.ca/n10/10-011-eng.aspAs is always the case, I had a budgeted amount of space for the story and, in the end, cut out affordability largely because it varies from city to city. As you say, it's a major issue in Vancouver and Toronto but less of a problem in many other major cities.As for the future, I'm sure you saw the quote from Mr. Soper at the end of the story,Best wishes, Ian Austen I clarified his above positions that didn't make sense… Read more »

0
0
patriotz

@chip:

Great economic minds think alike, and all that.

My point, which you missed completely, is that the reporter was taking the opposite stand with respect to the banking industry (i.e. calling them the good guys) as McQuaig would.

0
0
patriotz

@Chiones:

Michael Geller is an architect, planner, development consultant and SFU adjunct professor and occasional Westcoast Homes contributor.

In other words, yet another RE industry hack who won't even mention the only thing that matters to RE prices – fundamentals.

0
0
chip

"The reporter lives in Canada and – get this – is said to be a friend of Linda McQuaig."

Well, that says it all. McQuaig is the Toronto socialist who repeatedly bleats that Hugo Chavez is leading Venezuelans to a new era of prosperity and freedom!

Great economic minds think alike, and all that.

0
0
tim

@silly cub: Wow, really? This blog is about single-sided stats and you're going to pull out this card?

0
0
pricedoutfornow

That always makes me annoyed when people say "it could never happen here" (the big drops in RE prices) And then they go on to talk about banking rules, land supply etc. And I think "REALLY, so although our bubble-paths increased in the same manner, they could never DROP in the same manner, and it's just some random fluke that house prices increased in Canada at the same time that there's a bubble happening in many other countries in the world???" Because all of those factors, land value, banking costs have ALWAYS been around, so why didn't prices increase oh, YEARS ago? See…there's no real logic to those arguments, it's all someone trying to justify that the bubble is not a bubble, when hey guess, what-IT IS!

0
0
Chiones

Vancouver's academia should be turfed when this thing blows: "As my plane was taking off, I calculated that Metro Vancouver's median house price is about four times that of Phoenix. I could not help but wonder whether Metro Vancouver could ever experience similar drops in house prices. While between 1980 and 1983 we did see some homes drop almost 50 per cent, I do not think Vancouverites will ever witness what has happened in Phoenix. For one thing, our banking system is very different, and recent changes will further control who can build and who can buy into the market. Secondly, Vancouver's land supply, unlike Phoenix's, is constrained by the ocean, the mountains and protected agricultural lands. However, an old Blood, Sweat and Tears song did come to mind: "What goes up, must come down …" It's a song many… Read more »

0
0
silly cub

@Reality Cheque:

Isn't that a ray of hope for you… did you check all the other numbers? Did you?

0
0
Reality Cheque

It looks like the Vancouver east side prices are trending up, despite what has been pushed forth here on this bear blog:

http://www.yattermatters.com/neighborhood-numbers…

0
0
Anonymous

It's Alexandre Pestov, not Alexander. Former support manager for Hewitt and Associates, current MBA student. Escaped product of the big red machine, would explain the dichotomic left and right wing leanings. Patriotz has been exposed.

0
0
admin

@patriotz: Wow, suprisingly sloppy to end up in print at the NYT. Did they downsize all their factcheckers?

Agree with Shannon, that guy should be on 'talking with americans' – I missed the part where he congratulates Canada on getting it's first paved highway.

Can you imagine a Canadian market where 10% down and a 25 year term was the standard requirement?

0
0
patriotz

The reporter lives in Canada and – get this – is said to be a friend of Linda McQuaig. I think she should give him a talking to.

🙂

http://www.rrj.ca/issue/1996/summer/226/

The issue for the reporter is not US ignorance, but Canadian delusion. But the NYT takes the blame too for letting blatant factual errors get through.

0
0
shannon

That NYT article once again proves to many Canadians just how ignorant the people in the US can be about what happens in Canada.

Maybe his next article should be reporting on how good the igloo housing market in Canada is.

0
0
patriotz

Surprisingly sloppy article in the NYT:

Some See a Real Estate Bubble Forming in Canada

(Canadian banks) maintained comparatively tight controls on mortgage lending to consumers. When zero percent down payments on mortgages were widely available in the United States, Canadians were typically required to put down at least 10 percent. American-style amortization periods stretching beyond 25 years were also relatively unknown in Canada.

What planet is this guy from? And no mention of CMHC guarantees?

If you click on the reporter's name at the top of the article, you will find that he's primarily a sports reporter, and has no background in business reporting.

0
0
patriotz

@Anonymous:

If you’re the government, or the banks, who get to spend the currency prior to the monetary inflation devaluing it

Banks don't spend the money that they borrow. They lend it back out. And on average, the term on the money that they borrow (i.e. deposits) is shorter than the term on money than they lend.

This means that under inflation, the money that the banks get repaid from their lending loses value more than the money the banks have to repay on their deposits. I mean unexpected inflation – once the markets expect inflation to continue, interest rates will adjust to reflect this.

Thus the last thing the banks want is increased inflation.

0
0