Martin Armstrong lists Canada under “RE markets to avoid”

While some Canadian cities offer reasonable affordability compared to household incomes, Vancouver’s housing is, by any measure, highly overvalued and vulnerable to a sharp correction. Prices have risen 55% from their 2009 trough to a level 29% above their prior peak. The average home price reached nearly C$800,000 (according to CMHC).

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Anonymous
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Anonymous
4 years 4 months ago

AKA the needle and the damage done, with the "heroin" still being sold freely on the street.

patriotz
Member
4 years 4 months ago
Florida GOP primary rides on housing crisis blame The housing crisis is at the heart of 2012 politics in the quintessential swing state. Florida Republicans are making their choice in Tuesday’s GOP primary based on which candidate they feel bears less blame for the mess their state is in. The collapse that sent the massive luxury homes around Lutz plunging to a quarter of their 2007 values upended not only the lives of those with underwater mortgages and unbending bankers. It cut a swath through every sector and social stratum. Of course nobody – not the candidates and not the… Read more »
southseacompany
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southseacompany
4 years 4 months ago

Another view from the outside:

"Canada's Subprime Crisis Seen With U.S.-Styled Loans: Mortgages" San Francisco Chronicle, Jan 30/12

http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/

southseacompany
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southseacompany
4 years 4 months ago
Anonymous
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Anonymous
4 years 4 months ago

Look at page 18 in the Martin Armstrong article. He shows a 78 year real estate cycle with the final 26 years being a contraction. Those waiting for a quick bottom may be disappointed. Real estate will likely be a declining asset for the next 20 years. Renting may be the best option for a long time. Look at the US they are over 5 years in to a RE contraction with no bottom in sight and many areas still being very pricey.

paradox
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paradox
4 years 4 months ago
Sheesh
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Sheesh
4 years 4 months ago
@ DEFAULT NAME the Cons are planning to increase French and English speaking immigration at the expense of family reunification immigration. Currently, immigrants can sponsor their parents and dependent children. I strongly suspect the Conservatives will try to remove the parents from this equation. After all, they are beyond their working years and will almost certainly become a burden on the healthcare system. As well, they may try to do away with the practice of recognizing dual citizenship. I recall there were whispers about this back during the trouble in Lebanon in 2006 (we spent $85 million evacuating citizens who… Read more »
SunBlaster
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SunBlaster
4 years 4 months ago

Now with CONservative government in majority, get ready for supersonic speeds in wealth transfer, where private losses will be transferred to a public balance sheet for a greater good. Anyone who believes that this government in particular is going to to anything about curbing this overheated RE market, knows nothing about finance and politics or the global power structure.

patriotz
Member
4 years 4 months ago
@SunBlaster: "As well, they may try to do away with the practice of recognizing dual citizenship." Do you mean recognizing dual citizenship or allowing dual citizenship? Not recognizing dual citizenship means that if you are a Canadian citizen you cannot represent yourself as a foreign citizen to the Canadian government. Not allowing dual citizenship means that you cannot hold Canadian citizenship at the same time as that of another country. China, for example, does not recognize dual citizenship but allows it. I double very much that you're going to see dual citizenship outlawed as it would negatively affect a great… Read more »
observer
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observer
4 years 4 months ago

Martin Arthur Armstrong (born November 1, 1949 in New Jersey) is the former chairman of Princeton Economics International Ltd. He was indicted on September 29, 1999 in the United States District Court for the Southern District of New York for conspiracy to defraud the United States.[1] for alleged fraud involving Japanese investors. On August 17, 2006, he pleaded guilty to one count of conspiracy to defraud the United States.[2] On April 10, 2007, he was sentenced to five years in prison.[3][4] He was released from prison on September 2, 2011.[5]

Wikipedia

VMD
Member
4 years 4 months ago
[BMO denies housing bubble] The Bank of Montreal poured cold water on the idea Canada's housing market could be headed for a crash, suggesting that prices are only "moderately high across the country." "Expect the housing boom to cool rather than crash," BMO's chief economist Sherry Cooper and senior economist Sal Guatieri said in a report published Monday. The bank does note, however, three risks to the outlook. 1. A sudden hike in interest rates, 2. a widespread Canadian recession, or 3. an economic slowdown in Asia reducing the number of foreign buyers would all take the air out of… Read more »
vangrl
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vangrl
4 years 4 months ago
trash crash alert
Guest
trash crash alert
4 years 4 months ago

Bank of Montreal (BMO-T58.08-1.14-1.93%) says Canada’s somewhat pricey housing market is likely to cool, not crash.

The bank’s economists say the only real trouble spot is Vancouver, where there are plenty of vacant high-priced condos going begging.

==================

They forgot to mention dramatic price drops to take take place in West Vancouver, swamped stucco houses in Vancouver to implode and cardboard built box houses in rest of Greater Vancouver and turtle pool country in Surrey and beyond where 20% plus drops are expected in short term.

Asset deflation is taking the world by storm – BC is next up!

patriotz
Member
4 years 4 months ago

@trash crash alert:

Their "Canada" does not seem to include Calgary and Edmonton, where prices are over 10% off peak and falling again, and the disaster area of Kelowna and the southern BC interior.

Why don't their reasons for why we're not headed for a bust apply there?

Anonymous
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Anonymous
4 years 4 months ago

these kinds of articles drive the bears nuts! soon, more bears will leave for ottawa.

0x13
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0x13
4 years 4 months ago

@VMD

My understanding is that BMO managed to sell a nice package of MBS that then allowed them to drop the interest to 2.99. From talking to someone at another big Canadian bank BMO is a little late to the party and they want to keep the game going.

Dufus
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Dufus
4 years 4 months ago

Isn't Michael Campbell a disciple of Martin Armstrong? Be care full with the negativity Martin. Only Ozzie J will be left to pump R.E. on Money Talks.

VMD
Member
4 years 4 months ago
[Canada needs more tools to cut household debt: FSB] – 1/30/2012 On the debt issue, it said: “Given recent global market developments, it is important for the authorities to continue to strengthen macroprudential surveillance and consider expanding the range of tools at their disposal – which currently include the leverage ratio and various government mortgage insurance eligibility requirements – in order to effectively address any emerging concerns.” The report did not prescribe any specific action to rein in mortgage debt. The issue is not new to Canadians. Carney and Finance Minister Jim Flaherty have warned consumers repeatedly against taking on… Read more »
VMD
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4 years 4 months ago
Many Franks
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4 years 4 months ago

For some reason this tune seems appropriate…

http://www.youtube.com/watch?v=vKITpVovTAE

Makaya
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Makaya
4 years 4 months ago
And people thought HAM would come to save us all… Shanghai New Home Prices Tumble 41% In Past Week While the number is likely influenced by the Chinese Lunar New Year, property consultant Shanghai UWin Real Estate Information Services Co. released an update on the Chinese new home sales market which is, to say the least troubling. Specifically, according to UWin, Shanghai new home prices fell 40.96% in the week ended January 29, compared to the previous week, to 16,144 yuan/square meter. If correct, it means that local homeowner violence is about to come back with a vengeance, as happened… Read more »
Anonymous
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Anonymous
4 years 4 months ago

@paradox:

What a shame that we're doing so poorly. It's depressing looking at that info-graphic. Who's been on watch during this time?

jumping in
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jumping in
4 years 4 months ago

It feels really good to read so many MSM papers bringing this society back to sanity. I was about to doubt my common sense 😉 But it also troubles me that we had to reach such an extent of madness before reacting. Let's hope the landing won't be too hard…

Best place on meth
Guest
Best place on meth
4 years 4 months ago

Thank god CNY is over, now HAM can get back to listing their houses.

jesse
Member
4 years 4 months ago

Et tu, Martin Armstrong?

VMD
Member
4 years 4 months ago

Another Mortgage related news update:

RBC Mortgage specialist Jason Wong just wrote:

"For a long time, mortgage debt was not included in many people's credit check reports.

Starting this year, mortgage debt will be listed on credit reports."

ON THE REPORT, IT WILL SHOW,

============================

An “M” for mortgage

Date reported / opened

Original balance

Mortgage balance

Payment amount

Payment history

============================
<a href="http://translate.google.com/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2 Fwww.westca.com%2FForums%2Fviewtopic%2Ft%3D423810%2Flang%3Dschinese.html&act=url” target=”_blank”>http://translate.google.com/translate?sl=auto&amp…” target=”_blank”>Fwww.westca.com%2FForums%2Fviewtopic%2Ft%3D423810%2Flang%3Dschinese.html&act=url

900kCrackHouse
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900kCrackHouse
4 years 4 months ago

@DEFAULT NAME: Keep in mind that HAM, grow-ops and cash deals skew the stats. Each of these problems has gotten worse over the last 30 years.

Some of the highest child poverty rates in Canada in west Vancouver? Really???? Anyone who works with the impoverished knows that they have been consistently been pushed out to New West / Surrey over the last 5-10 years.

asalvari1
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asalvari1
4 years 4 months ago

@Makaya:

Well, this is certainly opposite from what we were told by local media and realtors in the last 10 days or so – the CNY is the time when people go bananas and buy more properties…

I guess (/sarcasm on) all those people from china got here to buy properties, so nobody was buying there. (/sarcasm off)

crashcow
Member
4 years 4 months ago

Robert Shiller: A Housing Bottom? What Are They Thinking?

http://www.businessinsider.com/robert-shiller-hou

slurker
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slurker
4 years 4 months ago

@patriotz:

"THE BUYERS WHO PAID TOO MUCH."

I hear this a lot but empirically the average person tend to 'max out' at any opportunity given. In my opinion the slogan should be 'The lenders that lent too much'.

Anonymous
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Anonymous
4 years 4 months ago

Saw on BNN this moring the Cons are planning to increase French and English speaking immigration at the expense of family reunification immigration.

jesse
Member
4 years 4 months ago
@southseacompany: Read it, and this: OSFI head Julie Dickson said in a Sept. 26 speech the agency is “very focused” on mortgages and home-equity lines of credit, which allow individuals to borrow against the equity in their homes. In a Nov. 2 letter to Canadian financial institutions, the agency encouraged them to follow mortgage underwriting principles recommended by the Financial Stability Board, including limits on the ratio of loans to property values and regular stress testing of mortgage portfolios. OSFI regulates Canada’s biggest banks, as well as smaller loan providers and credit unions. Home buyers usually qualify for “non-income-qualified” mortgages… Read more »
Anonymous
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Anonymous
4 years 4 months ago
@southseacompany: This is a great article. Below are some abstracts taken from the SF Chronicle: Canadian lenders are loosening standards, offering mortgages similar to U.S. subprime loans that pose an “emerging risk” to financial institutions, according to the country’s banking regulator. Banks and other lenders are becoming “increasingly liberal” with mortgages and home-equity credit lines that don’t require individuals to prove their income, according to 152 pages of documents obtained by Bloomberg News under freedom of information law from the Office of the Superintendent of Financial Institutions. The mortgages, typically granted to the self-employed and recent immigrants, “have some similarities… Read more »
frank
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frank
4 years 4 months ago

Larry's numbers for today:

Vancouver East & West*

New Listings – 87

Back On Market Listings – 2

Price Changes – 31

Sold Listings – 44

Vancouver All Areas*

New Listings – 288

Back On Market Listings – 5

Price Changes – 93

Sold Listings – 119

*Attached & Detached – Date: 01/30/2012

paulb.
Guest
paulb.
4 years 4 months ago

New Listings 292

Price Changes 95

Sold Listings 123

TI: 13380

http://www.laurenandpaul.ca

Conrad
Guest
Conrad
4 years 4 months ago

@paulb.:

Ahhhh. Back to business as usual, as I knew it would be. Early January numbers always have low/unpredictable sales and are basically meaningless.

Thanks for the laugh again this year gents. See you next Jan for the same "Oh its crashing……doh" game again. Never gets old.

Lather, rinse, repeat

Devore
Member
Devore
4 years 4 months ago
mflat
Member
mflat
4 years 4 months ago

@Conrad:

Ummmm, how the hell is a +170 listing day bullish???

JR
Guest
JR
4 years 4 months ago

@Conrad: Yo Conrad. Its different this time.

Devore
Member
Devore
4 years 4 months ago

@VMD mobile: We'll see what happens. They may not make any more land, but will they make more money?

oneangryslav2
Guest
oneangryslav2
4 years 4 months ago

@oneangryslav2: Well, according to this link, this was the situation as of 31 December 2005.

At 31 December 2005, the value of the insurance policies in force was more than $273 billion

So they've more than doubled the level of issuance in six years.

http://www.parl.gc.ca/Content/LOP/researchpublica

oneangryslav2
Guest
oneangryslav2
4 years 4 months ago

@oneangryslav2: More searching turned this up:

Year Insurance in Force (Billions)

2005 273

2006 291

2007 345

2008 407

2009 472

Anonymous
Guest
Anonymous
4 years 4 months ago

@SunBlaster: …Now with CONservative government in majority, get ready for supersonic speeds in wealth transfer,..

Yes, you're in luck: they will be pushing additional funding for crop circles and tinfoil hats.

VMD
Member
4 years 4 months ago

@VMD:

re: mortgage debt will be listed on credit reports

was following the conversations on the chinese forum. Most of the users (including house-pumpers) are seeing this change as quite negative to home price. Previously one can use the same set of credit report to obtain several mortgages. "You used to be able to marry the same girl to several husbands, now you can't, you have to get a divorce first."

Can anyone confirm that credit checks didn't use to include mortgage holdings?

Devore
Member
Devore
4 years 4 months ago

@VMD: Hmm something not working here…

My recent credit report (end of 2011) had my mortgage listed by both Equifax and Transunion. The mortgage is now discharged, don't know if that makes a difference.

jumpin in
Guest
jumpin in
4 years 4 months ago

Great news: we are now in a balloon. They are harder to pop than bubbles, but they make a lot more noise!
http://www.montrealgazette.com/business/Canada+ho

What an idiot! And Garth says she is trying to sell her 3 million $ house. What an unbiased "study"…

Makaya
Member
Makaya
4 years 4 months ago

A comment on Larry's blog:

"Sometimes when you want to believe something, you have a different outlook. I work with mortgages and for a several months it’s been very slow. Ive notice the slowdown since summer and didn’t believe we could see prices come down. I feel different now. This decade have paid us well in the real estate business, But it’s time to face the fact that this could end one day. It looks like this boom is over for now."

jumpin in
Guest
jumpin in
4 years 4 months ago

She sounds like she is 100 yr old… but obviously invested a lot of her money into cosmic surgery

http://watch.bnn.ca/#clip609859

jesse
Member
4 years 4 months ago

At 123 sales, today saw the highest daily sales volume of the month. Here is last February in terms of daily sales and listings. If February shows similar trends to January — with listings up 20% YOY — we are in for some big days. But the market has disappointed before so don't get too excited; it just sets you up for failure. "Trust me on this."

sales listings sell/newlist

210 350 60%

147 267 55%

104 267 39%

104 246 42%

93 283 33%

182 227 80%

204 326 63%

81 262 31%

121 281 43%

198 322 61%

153 311 49%

219 287 76%

166 280 59%

116 270 43%

178 297 60%

209 290 72%

172 255 67%

137 280 49%

142 242 59%

204 305 67%

February 2011 month end data

Average Sales 157

Total Sales 3,140

Average Listings 282

Total Listings 5,648

Average sell/list 56%

Days in month 20

Days elapsed 20

% days elapsed 100%

Expected sales 3,140

Expected listings 5,648

Max daily sales 219

Min daily sales 81

Max daily listings 350

Min daily listings 227

VHB
Member
VHB
4 years 4 months ago

Jan-2012

Total days 21

Days elapsed so far 20

Weekends / holidays 10

Days missing 0

Days remaining 1

7 Day Moving Average: Sales 98

7 Day Moving Average: Listings 246

SALES

Sales so far 1481

Projection for rest of month (using 7day MA) 98

Projected month end total 1579 +/- 22

NEW LISTINGS

Listings so far 5484

Projection for rest of month (using 7day MA) 246

Projected month end total 5730 +/- 59

Sell-list so far 27.0%

Projected month-end sell-list 27.6%

MONTHS OF INVENTORY

Inventory as of Jan 30, 2012 13380

MoI at this sales pace 8.47

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