The thin ice that is our economy

Many Franks pointed out this article in the Economist.

Looks like some gloomy gus over at that magazine is taking a peek behind the curtain that is Canada’s economic miracle.

WHEN the world financial system collapsed in 2007, triggering a global recession, Canada recovered faster than any of the other members of the G7 group of large developed countries. Its banks remained solid, while low interest rates encouraged consumers to borrow and spend. But five years on, consumers are showing signs of flagging. The economy is set to expand by a paltry 1.6% this year. So the authorities are casting around for another source of growth. The trouble is they cannot seem to find one.

The problem?

Our engine of growth recently has been based on rising household debt. Imagine our surprise when the result of this growth in debt manifests itself in high debt loads.

Will we be able to engineer a smooth transition to an economy that grows based on business investment and exports instead?

Read the full article here.

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terracoins

Helpful information. Lucky me I discovered your website accidentally, and I’m stunned why this coincidence did not happened in advance! I bookmarked it.

Short'em High

@jesse#50, Re: April MOI from 1995 Thank you for posting! Is there any chance to get all months since 1995 in this format? That data would be a real treasure trove. Please tell @inventory that his April data is wonderful and the other months could even be the holy grail of MOI for the present cycle. That April 1998 inventory number 20,578 is also remarkable in today’s terms. Today that would be 25,000+ by simple population adjustment. From Wikipedia Metro Vancouver population: 1991 1,602,590 +37.0% 1996 1,831,665 +14.3% 2001 1,986,965 +8.5% 2006 2,116,581 +6.5% 2011 2,313,328 +9.3% BTW, I’ve got an idea about the MOI normalization challenge. I think the key in seasonally adjusting MOI apples to apples is knowing months since last annual peak sales. I’m thinking of an idea to compare cycle to cycle rather than YoY months.… Read more »

Democrass

VANCOUVER (NEWS1130) – A local economist predicts Greater Vancouver’s “listless housing market performance will persist through 2013.” Central 1 Credit Union‘s outlook for the BC housing market says sales last year hit a 12-year low. Economist Bryan Yu says the factors that contributed to the sales plunge and lower prices “are still in play.” He expects resales will fall another four per cent this year to 31,500 while the median price, the midpoint between highest and lowest, will slide six per cent to $474,000. Yu says “subdued immigration, stagnant employment growth and the most recent round of mortgage insurance rule tightening will weigh on purchasing… biting particularly hard in high-priced Greater Vancouver.” Looking at the province overall, Central 1 says “home sales will gather a bit of strength this fall and hold steady for the rest of the year, but… Read more »

patriotz

“I’m so glad its (China) by far the largest group we allow in each year.”

Actually the Phillipines is Canada’s #1 source country for immigration.

patriotz

” Many potential sellers may be waiting to list until after the HST is repealed thinking to attract buyers with the reduced property transfer taxes.”

What “reduced property transfer taxes”? Or are you just saying that people are dumb and understand squat about the HST? Well, OK.

Vote Down The Facts

“So now that the $10,000 First Time Buyers Bonus has run”

Yes, because the HST expires this weekend. Remember the $10K tax credit only applied to new homes which would have attracted HST in the first place:

http://www.bcbudget.gov.bc.ca/2012/homebuyers/2012_First_Time_Home_Buyers_Fact_Sheet.pdf

It was a stopgap, nothing more.

jesse

Commenter “Inventory” revealed historical April inventory and sales going back to 1995. I posted these data at
http://vancouverpeak.com/Thread-Monthly-Data-from-2005-Feb2013?pid=764#pid764

Interestingly, some years saw some mighty high April MOIs… assuming the data are correct…

N

I thought HST only applied to new builds. If that is the case, it is not what is keeping existing owners from listing.

jesse

http://www.vanmag.com/Real_Estate/Feature_Stories/Is_Vancouver_Really_as_Expensive_as_it_Seems

The awaited Van mag article is now online. (Lays it in the open pit) Proceed.

painted turtle

Was walking on Cambie street tonight. Almost bumped into…. Tsur Sommerville. Wasn’t sure first, because he was wearing grey rags that did not reflect his 250 k UBC salary, but then I thought his look was very “bourgois boheme” , as they call them in Paris. He was walking his dog, and like many dog owners, Tsur is the look alike of his pet: a giant grey doodle. What a cute couple. He looked less of an idiot than when he lies on Global:)

vanpire

So now that the $10,000 First Time Buyers Bonus has run out is it safe to assume there are officially no first time buyers left?
This is f*cking AWESOME!

chilled

Devore Says: March 28th, 2013 at 6:18 pm 37 “From slagging the real estate industry almost daily then calling anyone who wants to sell independently (even buy!) without an agent, a fool.” He also does the same to people investing on their own, so maybe he is more consistent than you think? His opinion is people should have professional help when dealing with large sums of money, if they do not know what they are doing, which the vast majority do not. He is correct. You were probably “lambasted”, because this is not the “how does Garth Turner suck today” blog, nor the proper place to air your grievances at being banned from his blog. Your fixation with the man borders on disturbing. You’ve said your piece. Life is short. Move on. +++++++++++ You’re right about one thing, this probably… Read more »

Best place on meth

“New listings coming back up–last week was really weird with sub 200 days of new listings. Maybe you guys are right–people were waiting until post April 1st / HST. Who knows”

This is my belief.

Anonymous

devore#37:

I think you belong on Garth’s blog…

vangrl

“Garth Turner is an idiot. I have long ago thrown into the trash the two books of his I mistakenly bought. I do not dislike Garth for his prognostications, overall, he has his stick on the ice. What pisses me off, as you said, is his incredible hypocrisy. From selling survival gear on his website to mocking people who even make such a suggestion now. Yes, times change, but his absolute refusal to acknowledge his meandering messages verges on a delusional personality disorder at minimum. From slagging the real estate industry almost daily then calling anyone who wants to sell independently (even buy!) without an agent, a fool. I could go on, we all could with many examples, why bother? He flip-flops more than a sword fish hauled into a Bayliner in the Gulf of Mexico!! At least the fish… Read more »

VHB

New listings coming back up–last week was really weird with sub 200 days of new listings. Maybe you guys are right–people were waiting until post April 1st / HST. Who knows. We continue on course for a drip-drip-drip downward as the year folds out.

Total days 20
Days elapsed so far 20
Weekends / holidays 8
Days missing 0
Days remaining 0
7 Day Moving Average: Sales 133
7 Day Moving Average: Listings 239
SALES
Sales so far 2395
Projection for rest of month (using 7day MA) 0
Projected month end total 2395
NEW LISTINGS
Listings so far 4811
Projection for rest of month (using 7day MA) 0
Projected month end total 4811
Sell-list so far 49.8%
Projected month-end sell-list 49.8%
MONTHS OF INVENTORY
Inventory as of Mar 28th, 2013 16635
MoI at this sales pace 6.95

paulb

New Listings 271
Price Changes 107
Sold Listings 139
TI:16635

http://www.paulboenisch.com

VMD

@30 gokou3
re: “Silver: $30,000 off any home”

Interesting~ No wonder “the Easter Bunny is stashing chocolate eggs at #Silver. Drop by Saturday to see if you can find them!” @IntracorpCanada.

lol. (Can you by chance have time to forward me the email to greaterfoolvancouver(at)gmail.com , Thanks!!)

Beuller

“Disgusted by the endemic bribery, Wang Ping, 37, a bar owner in Beijing, decided to send her son abroad for his education. In August, she wept as she waved goodbye to her only child, whom she had enrolled at a public high school in Iowa.”

http://www.nytimes.com/2012/11/22/world/asia/in-china-schools-a-culture-of-bribery-spreads.html

What a lovely culture. I’m so glad its by far the largest group we allow in each year. How can we get more? Is there a more corrupt race we could focus on maybe?

Devore

“From slagging the real estate industry almost daily then calling anyone who wants to sell independently (even buy!) without an agent, a fool.”

He also does the same to people investing on their own, so maybe he is more consistent than you think? His opinion is people should have professional help when dealing with large sums of money, if they do not know what they are doing, which the vast majority do not. He is correct.

You were probably “lambasted”, because this is not the “how does Garth Turner suck today” blog, nor the proper place to air your grievances at being banned from his blog. Your fixation with the man borders on disturbing. You’ve said your piece. Life is short. Move on.

Brian Ripley

Not Much of a Name… #15 above said:
“So, it only takes three times the median household income to qualify to purchase an “average” Van East home.”

I calculate a slightly larger requirement: http://www.chpc.biz/vancouver_chart.html

“…according to my calculation, it takes 3.4 average BC wage earners (ménage à trois et demi) to buy an average Vancouver SFD”

chilled

Anonymous Says: March 28th, 2013 at 7:56 am 3 Super Bear Garth Turner is ridiculing anyone (in his response to people’s comments) that says a crash is coming. Did the Banks (he indirectly works for) have a secret talk with him? He’s going to be left with the <80 IQ crowd as his followers if his flip flops keep up any longer. ++++++++++++ Garth Turner is an idiot. I have long ago thrown into the trash the two books of his I mistakenly bought. I do not dislike Garth for his prognostications, overall, he has his stick on the ice. What pisses me off, as you said, is his incredible hypocrisy. From selling survival gear on his website to mocking people who even make such a suggestion now. Yes, times change, but his absolute refusal to acknowledge his meandering messages… Read more »

Clockbike

April first is going to be interesting. Many potential sellers may be waiting to list until after the HST is repealed thinking to attract buyers with the reduced property transfer taxes. Of course, this logic works both ways, so: interesting month ahead.

Doomer

@Fabio
Staples has some safe deposit boxes. I have one. You never know when the banksters will pull the plug.

private banker

I am a private banker, I have fireproof safe to securely store your cash, don’t trust the large banks, keep safe with Security Banking, I am a karate expert and have bear spray