What’s wrong with Canada’s economy?

Economists are apparently ‘scratching their heads‘ over Canada’s humdrum economic growth.

The US has been growing new jobs lately, but not so much here at home.

In June, Canada lost 9,400 positions and the jobless rate edged up to 7.1%, the highest reading in six months. On Friday, Statistics Canada will release its labour force survey for July.

The Canadian economy “should improve next year when stronger U.S. growth helps to boost hiring and investment here at home,” the Conference Board’s Mr. Hodgson said in Tuesday’s report.

Read the full article over at the Vancouver Sun.

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southseacompany
Member
southseacompany

And from the UK; “UK homeowners start to panic sell in the face of house price uncertainty” The Telegraph, July 7/14.

“Panic selling is expected to sweep Britain as homeowners try to cash in on record high house prices before the market starts to cool, new data finds.”

southseacompany
Member
southseacompany

“Canada in ‘significant’ housing bubble”, Financial Post, today.

http://business.financialpost.com/2014/08/07/canada-in-significant-housing-bubble/

““I firmly believe we have a significant property bubble here in Canada,” Hodgins said, noting residential property prices on a price-to-rent ratio are more than 50% overvalued if rates end up in the more normal 3%-to-4% range. “If and when short-term interest rates rise, you’ll see property prices come down sharply.””

Son of Ponzi
Guest
Son of Ponzi

#40
“All quiet on the Western front”.
The quiet before the storm.

Westside Realtor
Guest
Westside Realtor

Garth nailed it again tonight.

I absolutely agree.

And Westside is QUIET.

If you don’t believe me, dig into the stats yourself Oracle. By the way, when are you moving away again?

Melba
Guest
Melba

…..Except that renting and buying are not equivalent. Can’t believe this needs to be said…..

For the first time ever, I agree with Bulltard. Renting is much more attractive then buying and I also can’t believe this needs to be said.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

Except that renting and buying are not equivalent. Can’t believe this needs to be said.

Fun Da Mental
Guest
Fun Da Mental

@#34

“The “intrinsic value” of real estate is therefore defined as the net present value of all future net cash flows which are foregone by buying a piece of real estate instead of renting it in perpetuity. These cash flows would include rent, inflation, maintenance and property taxes.”

http://en.wikipedia.org/wiki/Intrinsic_value_(finance)

http://books.google.ca/books?id=7N2nHNhvFqYC&pg=PT650&lpg=PT650&dq=%22fundamental+value%22+%22real+estate%22&source=bl&ots=zTl6JSbQ87&sig=7OwE0_BtceaWG1VlAzZOFfqpb-0&hl=en&sa=X&ei=oe3jU9X6J-TTiwLU2YCICQ&ved=0CE8Q6AEwCQ#v=onepage&q=%22fundamental%20value%22%20%22real%20estate%22&f=false

patriotz
Member

@34: “Economic bubble. Definition: A market phenomenon characterized by surges in asset prices to levels significantly above the fundamental value of that asset. ”

In plain English, “prices to levels significantly above the fundamental value of that asset” means “buying is much more expensive than renting”.

Oracle
Guest
Oracle

RE has nothing to do with incomes in the long run.

You pay for it over 25 Years. Then, it’s in you family for hundreds of years.

That’s how China and India thinks.

Oh, bond yields approaching record lows. Rates are not going up for a long time.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

>Since buying is much more expensive than renting even at current interest rates, it’s a bubble even if rates never go up.

that’s not what a bubble is. this is what a bubble is:

Economic bubble. Definition: A market phenomenon characterized by surges in asset prices to levels significantly above the fundamental value of that asset.

for real estate, the cost of credit is key to determine the fundamental value.

if you want to make up terms don’t name them after things that already exist. that just adds to the confusion.

patriotz
Member

@31:

Since buying is much more expensive than renting even at current interest rates, it’s a bubble even if rates never go up.

piper
Guest
piper

http://www.whichmortgage.ca/article/household-debt-on-the-rise-181260.aspx

The average household debt in Canada rose by around 6 per cent last year according to new figures from BMO.

The highest levels of debt are in the western provinces, with Alberta seeing a 40 per cent increase in the last year to an average debt of $124,838.

Those in B.C. saw a 26 per cent rise to $99,834. In the east it’s a different picture, with Ontarians reducing debts by 12 per cent to an average of $67,507.

The figures also show that mortgages are now held by 43 per cent of Canadian households and that house prices are the major reason for the increase in overall debt.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

if the “bubble” is based on cheap credit it isn’t a bubble at all. the cost of credit is a rational basis on which to make a buying decision.

therefore, by claiming that high prices are caused by cheap credit, bears are claiming that high prices are rational and based on fundamentals.

Lynn
Guest
Lynn
patriotz
Member
Kent, NY Kent is 60 miles north of NYC. That’s a bit farther than Abbotsford is from Vanocuver, but note that the greater NYC region has about 15 million people. The crash in 2008 sent prices “dropping, dropping, dropping,” Mr. Bradley said, adding that values today are “close to half what they were at the height.” A recent snapshot from the Hudson Gateway Multiple Listing Service showed 132 houses on the market in Kent, 63 of them in the $180,000-to-$300,000 range. This makes the area affordable for families like the Lennons, both teachers, who had been renting in Hastings; their two-bedroom two-bath 1965 house on 0.75 heavily wooded acres cost $265,000. Claire Tsakanikas, another first-time buyer, recently paid $100,000 for a two-bedroom one-and-a-half-bath ranch on half an acre, a foreclosed property near Lake Carmel. Are prices that low even in… Read more »
Corruption
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Corruption

Boy I’m glad the Conservatives got elected, because they know how to manage an economy, right? Right?

Well, maybe if they gave the money to and middle-low income families, support for daycare, small business, and schools instead of handing out gimmies to the already-wealthy and big corporations things would be better. After all, that’s the scientifically proven method to boost economic growth.

Ahh, I forgot. They don’t like science. It tells them things they don’t want to hear.

patriotz
Member

@23: “where as a local would buy it as starter house to live in. example, 1.2mil liveable house turns into a 2.5mil monstrosity”

You’re saying that locals would be willing to pay 1.2mil to live in a teardown, but the bubble is all the fault of foreigners?

Joe Mainlander
Guest
Joe Mainlander

@#22. I see. Not allowed to cite Canada influences, while you can cite Asia influences. Handy rule.

Aggregator
Guest
Aggregator

Ukraine to get helmets, vests from Canada to help protect border

Non-lethal, but no ban on weapons sales

The equipment is "non-lethal," which usually refers to defensive or protective equipment, as opposed to weapons used for attacking.

A background document attached to the news release noted there's nothing stopping Canadians from selling military hardware to people in Ukraine. The EU has just lifted its own ban on the sale of military technology and hardware into Ukraine, the document noted.

Ya right. I'm sure it will only be non-lethal equipment sent to Ukraine when StatsCan last year revised GDP to include small military arms and equipment. That should boost GDP figures over the next few quarters.

Now that everything Ottawa has done to revive economic growth has failed, they'll just start or jump into a war.

UBC in crisis mode
Guest
UBC in crisis mode

What economy, in Canada?
We only have banking industry and RE industry -;).

CBC
Guest
CBC

@ bad data
“HAM only affects “high end properties””

not always true. they may buy a property to teardown and build a gawdy mansion where as a local would buy it as starter house to live in. example, 1.2mil liveable house turns into a 2.5mil monstrosity

Son of Ponzi
Guest
Son of Ponzi

Joe Mainlander,
This blog is called Vancouver Condo Info not Canada Condo Info.
I’m talking about the impact of HAM on RE in Vancouver and Richmond.
And I think it is a good guess that at least 50% of HAM is concetrated in those two areas.

good data
Guest
good data

Cheap Money has distorted the market so much that people’s perceptions have shifted.

Cheap Money affects “all properties”, the fact goes. People’s borrowing ability has increased so much that “high end” is now defined as anything that is a detached house and is less than 20 years old, within a 40 minute drive to downtown, and has enough room for you to put all your junk and park 1 1/2 cars.

wcth
Guest
wcth

“Vancouver has a history of Versace store locations….. Both closed several years after opening. ”

http://www.retail-insider.com/retail-insider/2014/8/versace-home

bad data
Guest
bad data

Vancouver rumoured to be home to world’s first Versace Home flagship store

http://www.theprovince.com/life/Vancouver+rumoured+home+world+first+Versace+Home+flagship+store/10092016/story.html

it must be because of all the high paying jobs we have here.