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Friday Free-for-all!

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201 Comments

Hey! The weekend is here!  Get those taxes filed yet?

Time to do our regular end of the week economic news roundup and open topic discussion thread.  Here are a few recent stories to kick things off:

–HST to make family life more expensive
–Housing market to cool: Carney
–Five reasons to love rising interest rates
–Teranet house price index
–Luxury sales through roof
–40% off in Kelowna
–BC sees Olympic jobs boost
–Certified Bubble Pricing
–Best place in Canada: Ottawa?
–Victoria a real estate rollercoaster
–US selling frenzy as homebuyer credit ends

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

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patriotz

@Pythagoras:

And, over the long run, owning a house cost more in expenses than it returns in gains

That depends completely on how much you paid for the house.

If you buy today, absolutely. If you bought in, say, 1985, or before 1980, absolutely not.

And I'm just talking about rental value, not any gains you could make by selling.

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patriotz

@Chilled:

In a $563-million project, the stadium get a new retractable roof by next summer.

The original stadium cost about $140 million to build, which in today's dollars would be about $300 million. So the roof is going to cost well over the cost of the stadium.

Bill Bennett's original plan was to use the profits from selling off the Expo lands in bits and pieces long term to pay for the stadium. That was sunk by Vander Zalm virtually giving away the lands to Li Ka-Shing near the bottom of the RE market in 1987. And Vander Zalm today has the nerve to pose as an anti-tax campaigner.

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Pinocchio

@squidly77:

Squidly, we don't need blogs like that here in Vancouver.

Our local Real Estate Industry, and local media, are good will custodians.

They would never lie, our RE is not in a bubble, we are an international city, and we ran out of land.

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painted turtle

Funny how EVERY friend/colleague I met in the last two weeks talked to me about Vancouver Real Estate:

1) If they rent, they want to forecast if it will fall by 20% or 50%

2) If they own and are flexible, they want to sell

3) If they own and are not flexible (i.e. families with kids and jobs), they try to convince themselves that all is for the best in la la land (market currently going through the roof, the rich Asian theories backed by pseudo academic studies, the crystal meth factories theories, the rich Asian mafia gangsters theories, etc)

4) If they are buying, they want to bury their head in the sand.

It has become a VERY touchy subject… It feels like we are at a cross road…

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Chilled

http://www.theprovince.com/Place+roof+collapse+ag…

Incredibly symbolic of what is happening in the housing market.

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squidly77

That should be, wormed his way into the city of Calgarys website.

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squidly77

A Calgary blogger wormed into a city of Calgey site can you guys do what a calgarian has done..find the sites

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crashcow

Latest Study Uncovers Risks to Canadian Recovery

ECRI

April 29, 2010

"Since emerging from recession in July 2009, Canada has been experiencing the strongest recovery among the G7 economies. However, ECRI’s latest analysis reveals that changing global cyclical dynamics could soon undermine the Canadian economy, with important implications for the Canadian recovery in the coming months."

Who is ECRI and why should I care?

"ECRI is perhaps the only organisation to give advance warning of each of the past three recessions; just as impressive, it has never issued a false alarm." – The Economist

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Spec

@Ready

I remember a different Bubbles. (http://www.toptenz.net/wp-content/uploads/2008/10/bubbles.jpg)

@ No-lympics

Turning to the dark side of the force? RealPaul with a different handle? You're stinking up the place with your vitriol. Take a hint and drop the H8 brother, get the tinfoil hat loosened or join the belligeratti over at RET.

I just calls 'em as I sees 'em.

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ReadyToPop

I Really Hate Bubbles!

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jesse

Changing any capital gains exemption on personal residence won't change the long-term price trend. Investors are taxed on capital gains and will compete with owner-occupiers over the same stock, so must eventually set the marginal price.

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NO-LYMPICS

So far, 9 count em 9 dickheads.

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NO-LYMPICS

Only a dickhead would vote me down.

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Globello

It would be kinda tough to make cap gains taxable on RE without allowing cap lossesto be claimed. And what would be the point of giving speculators such tax breaks when RE is all set to plunge, and languish for years.

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NO-LYMPICS

The Feds, via the CHMC, has encouraged flipping aka irrational exhuberance.

Capital gains?….remember when we had a $100,000 lifetime capital gains exemption, but Chretien took it away ?

The feds have helped their elite buddies, they never cared about the average homeowner, if they did they would have foreseen the bubble and the bust. It is now all coming to pass.

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Pythagoras

@Starving Artist:

I agree, and while they’re at it, eliminate the capital gains exemption for principle residences.

Why the hell should RE flipping be tax exempt??? Lunacy

——-

Because if you tax the gains, you have to allow the expenses, including mortgage interest, to be tax deductable and it's clear that deducting interest and expenses would drive house prices even higher. And, over the long run, owning a house cost more in expenses than it returns in gains, so if you taxed the gains, home owners would actually be further ahead as $’s spent on expenses would be tax free.

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jesse

@Keeping an Eye on The Pimps: What do you mean by "stealth wealth transfer?"

I think putting up factual and logically consistent posts, with the resulting message clear and repeated, is a start. It's worth remembering that brilliant posts made months or years ago are lost in the clutter and are worth being promoted to the front page. Their underlying theses cannot fade with time and are even more relevant now than before.

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Keeping an Eye on Th

@jesse:

Jesse, perhaps it’s about semantics.

But the issues are real and have real impact on people.

We have a detrimental stealth wealth transfer taking place. I don’t think the “pimps” are so ignorant that they don’t realize this.

The consequences are real for families.

But as you say let’s use this forum for good use.

I read every post from you, with much respect, so here is the challenge…..

How do we move on from making bandwidth noise to becoming prime movers of action for good will?

What would you change my handle to make it less offensive?

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joeblow

Meant to say "Johnny Horton blog"

but was laughing too hard to type straight.

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joeblow

The "johnny Horton bpog"??? ha ha ha

That's a howler.

With nobody left to stoop to his level, he might succeed in turning that place into a porno site.

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northeast canuck

@Crash:

I was listening to the radio yesterday morning and they were pumping the Quatro development big-time, they were predicting HALF of the units to sell on the first day!!! They were interviewing the morons who had been lining up to throw their money away. So, all-in-all it was a failure, but of course they don't present it like that.

I saw on CBC last night that they only sold 26 units, so I am not sure where the 47 comes from or who is right. But some of the "interviews" they had with the potential buyers were revealing. Comments like "If interest rates stay where they are I think that I'll be OK", or "I'm worried about interest rates, but it's just so MIND-BOGGLING". With idiots like these, who needs a greater fool?

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jesse

@Keeping an Eye on The Pimps: "the pimps need to be confronted"

I don't mind discussing what Rob says but I do mind discussing what others think he is.

Johnny Whoreton over at RET is no pimp. He, along with a couple of other posters, ruined what was a barely passable real estate forum. It makes me sick the RET moderators let them do it.

No matter. We now have the VCI forum! Let's put it to good use!

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Keeping an Eye on Th

@jesse:

Please keep discussions of RET, Rob Chipman, and politics off the blog. This used to be a holy place of peace and goodwill.

Jesse, I agree with regards to politics, but exposing the pimps and pumpers, coincides well with peace and goodwill, so I don’t see the conflicts.

Bubbles hurt families; the pimps need to be confronted.

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jesse

Please keep discussions of RET, Rob Chipman, and politics off the blog. This used to be a holy place of peace and goodwill.

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Keepin an Eye on The

@Best place on meth:

“That guy should check himself into a mental hospital, I cannot believe anyone would do business with him.”

I don’t think a mental hospital could do much for him. What might be a start is some form of rehabilitation, perhaps some kind of spiritual cleansing, later to be followed by some courses in Ethics, and finally several years of Economics.

In economics we speak about the misallocation of resources, and moral hazards, during the bubble blowing process.

In practical everyday experiences we need to point out the distortions in terms of how people like him with so little to offer, can make so much money, while responsible people watch their savings dwindle to less and less purchasing power.

Thankfully, bubbles do pop, and some of the low lives go back to being nothing again.

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