FFFA! Rates, Crime, Debt, Rent, Boomers

Hey! You made it to the end of another work week so go enjoy yourself a long weekend!

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

Better to rent or buy?
Boomers will finance the market
Challenges for Richmond sellers
Will extradite criminals for cash
Hike rates now
Imaginary money
CAAMP shows concern

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

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Sunny123
Sunny123
7 years ago

Re: Joy (#140

What you are looking for is the Nazi Party. Where are you ancestors from, dumb dumb ? Unless you are 1st nation, shut the F up and try harder in life…

Sunny123
Sunny123
7 years ago

Re: Barb Rennie (#91)

Again, I felt ashamed to be a Canadian when I read about another example of generalization on this site with endless complaints and blames towards every immigrants because she are a loser herself…

Sunny123
Sunny123
7 years ago

Re: Tony Says (#9)

Hey Tony, the plumber, your comments of generalization make me ashamed to be a Canadian, you dumb redneck…

Some Guy
Some Guy
7 years ago

“If Canadian banks are not grounded with deposit ratios and can lend based on profits, on the back of rising house prices, imagine what happens when those profits turn negative.”

Indeed, imagine – in fact you don’t have to imagine, just look at what happened in the U.S. or any country anywhere where a housing bubble burst: failing banks and government schemes to manage an orderly wind-down or recapitalize them.

The Canadian banks have a number of advantages in that most of their risky mortgage loans are insured, they have a high baseline profitability, they’re relatively diversified, they operate in a relatively uncompetitive market and they are assured of government bailouts if needed, but they’ll still feel it if and when housing prices turn downwards and they will curtail lending in order to conserve capital if they need to.

Real Estate Pimp
Real Estate Pimp
7 years ago

Then house flippers are back in town.
Remember Nelson Skalbania. Where is he now?

Some Guy
Some Guy
7 years ago

@188 Gokou3 “You really need an education on how banks operate.”

Well, I took the time to explain how I think banking works, why don’t you do the same and we can compare notes? Or at least clarify your points of disagreement with what I wrote. I generally agree with your posts, so I’d be interested to hear your take.

Just stating that I’m wrong without explaining why or offering a counter-argument doesn’t really advance the discussion. Besides, it will pass the time while the housing market goes nowhere… 🙂

Alan
Alan
7 years ago

“You really need an education on how banks operate. Then you can thank Jesse for his corrections to your thinking and me for being blunt.”

How bank operate? In one sentence, borrowing you an umbrella when sunny, and taking it back while it is raining.

Eddie
Eddie
7 years ago

From that Harper article – “But when asked about the biggest risks to Canada, Harper said they were external. “That’s what keeps me up at night,” he replied..

Notice they already have the blame game planned for Canada’s upcoming crash.

Bull! Bull! Bull! @Real Estate Pimp
Bull! Bull! Bull! @Real Estate Pimp
7 years ago

Tell someone who cares.

gokou3
gokou3
7 years ago

Some guy,

You really need an education on how banks operate. Then you can thank Jesse for his corrections to your thinking and me for being blunt.

Devore
Devore
7 years ago

“Of course, down vote this post because it makes you angry.”

Doesn’t make me angry, bub you did trick me into reading twice in search of a point. All you said is there are rich people in Vancouver… got news for you, there are rich people everywhere.

Devore
Devore
7 years ago

“there’s a hilarious commercial from the “Flip This House” guy. You have to hear it — the transcript doesn’t capture the hilarity” Noticed those Flip This House seminars are back. They had them last year too. Whatever happened to that “small motivated team” they recruited then? I didn’t pay much attention to them, but they blast it every commercial break, so you can’t avoid it. I thought my ears were deceiving me, but I detected a splice whenever “in Vancouver area” comes up. Too lazy to even do a custom ad for each city. The promises of guaranteed profits with ZERO risk (they actually repeat this a couple of times) are simply outrageous. Come to think of it, it’s not “profit”, it’s “cash flow”, but how do you get “cash flow” from flipping houses? Isn’t it just one-time capital gains?… Read more »

Spaceman
Spaceman
7 years ago


Yeah, I’ve heard that ad a few times lately. I was wondering what those two steps would be:
1-buy
2-sell
… or perhaps
1-buy
2-pray
… or maybe
1-pay for my expert advice
2-go to hell

I’m sure some clever folks on this blog can come up with some other “2-step programs”. Any takers?

Anonymous1
Anonymous1
7 years ago

Just saw a house on marine drive in Whit Rock. list is $3,800,000.00

So how much can his house’s price come down to after a correction?

Obviously, there are other factors at play with prices in Metro Vancouver. And the Bears on this blog must realize that its more than rental rates and income rates.

There is a lot of wealth here now. Until you accept that fact, you will continue to feel bewildered.

Oh, the taxes on that house are $18,000/per year.

Of course, down vote this post because it makes you angry.

jesse
7 years ago

I don’t know how many of you listen to NW980 but there’s a hilarious commercial from the “Flip This House” guy. You have to hear it — the transcript doesn’t capture the hilarity — wait for the splice-in “in the Vancouver area”. Apparently houses “in the Vancouver area” can be flipped in two easy steps.

jesse
7 years ago

“why does the straightforward observation that bank capital is increased by profits (and is reduced by losses and defaults) and isn’t influenced by deposits or reserves mean that I should short the banks?”

If what you state is true that means Canadian banks are in worse shape than their US counterparts. We all know what happened post-2008: something like 80% of US bank equity was wiped away as house prices collapsed. If Canadian banks are not grounded with deposit ratios and can lend based on profits, on the back of rising house prices, imagine what happens when those profits turn negative. 😯

This is not investment advice lol

Makaya
Makaya
7 years ago

Just saw an ad on facebook promoting seminars for… flipping properties! Some folks didn’t get the memo!

Check this out: http://www.findandflipevent.com/facebook2/index.asp?Contact0State=BC&cluster=CWA-General

chilled
chilled
7 years ago

Loud Howard Says:
May 20th, 2013 at 7:40 pm 178

http://ca.finance.yahoo.com/news/harper-says-household-debt-not-biggest-worry-191643714.html

“Canada’s soaring consumer debt is backed by solid assets, Prime Minister Stephen Harper said on Thursday”

+++++++++++++++++++++++++

Love or hate Harper, out on the world stage, when pressed with such questions, I doubt I would want a leader saying anything else, regardless of it being the truth or not.

Anonymous
Anonymous
7 years ago

crabman: “This unit was purchased for $2M and is now selling for $1.7M:”

That place was for rent on craigs list for months at $3500 per month. No takers. After maintenance and property taxes they would be just over 1.4% yield if it could rent for that (which it couldn’t).

Loud Howard
Loud Howard
7 years ago

http://ca.finance.yahoo.com/news/harper-says-household-debt-not-biggest-worry-191643714.html

“Canada’s soaring consumer debt is backed by solid assets, Prime Minister Stephen Harper said on Thursday”

girlbear’s friends must have advanced copies of the PM’s finance talking points when he’s abroad. “Backed by solid assets” if it wasn’t mistaken from “backed by solid ass-heads”, could give people the impression that equity in their home today is their’s to spend.

If Harper asserts “solid assets”, apparently the government is endorsing the current debt level and would therefore backstop any shortfall among those who have reduced wages in the future.

It’s too bad reporters at the event didn’t follow up with Harper and find out if asserting “solid assets” means his government is guaranteeing the present valuations of homes and unsecured loans going forward.

Best place on meth
Best place on meth
7 years ago

@Girlbear

If you’re referring to 1911 Acadia Rd, that one is the exception to the rule.

Most high end sales have been 10-15% below ask.

Girlbear
Girlbear
7 years ago

@175

One of the houses was just over $10M in UBC…sold in for basically ask. Only took a few months which is pretty good I thought.

mac
mac
7 years ago

Girlbear,

What’s your definition of high end? Have friend with 6M high end and nothing is moving.

Many Franks
7 years ago

@Q: Don Antle, not David Bains. Baines is the reporter.

Girlbear
Girlbear
7 years ago

Speaking to some friends in the industry.. Realtor friend: Last 6 months were BAD, but sales are picking up a bit. He sounded cautiously optimistic. Mortgage broker friend: A lot tougher to get loans through these days. Also he said over the last 5 years, the bulk of his business was refi’s…refi’s to take more equity out. He said he has seen loans that started at $500k go to $800k, then over $1mill as owners keep leveraging off the “price” increases. He expressed that he is more than a little worried about this as most of the “clients” are all in. As in no other investments. No stock portfolios, no RSPs, no excess cash. Personally, I am seeing some of the high end on the west side starting to move. A couple of friends sold houses for what I would… Read more »