It’s not a bubble, it’s a balloon. Lets give it more air.

Patriotz pointed out this article over at the Globe and Mail:

Economist caution against Harpers focus on rising home-ownership rate.

Stephen Harper is putting a new focus on Canada’s rising home-ownership rate, but some economists warn that pushing to drive it higher is a “wrong-headed” approach in an overheated market.

In government, the Conservative Leader brought in policies to encourage Canadians to save for their first home. Now, on the campaign trail, Mr. Harper’s promotion of home ownership is shaping up as a key part of his party’s pitch to Canada’s younger middle-class voters as he promises a package of new measures.

In a new twist to his message, Mr. Harper recently boasted that his party’s policies have contributed to the fact that Canada’s home-ownership rate is now higher than in the United States.

We’re number one! We’re number one!

Canada’s home-ownership rate is not often cited by Mr. Harper. It is a statistical achievement that did not turn out well for the U.S. when it reached a similar level more than a decade ago.

Oh. Read the full article here.

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realist
Member
realist

oops, article title above should have read:

“Weak NZ Dollar Makes Auckland Property Cheap FOR FOREIGNERS Despite Price Rise”

Just as in Vancouver, we know property isn’t cheap for locals!

patriotz
Member

@22, @24:

For a true investor, a falling currency don’t make an investment cheaper if the earnings are in the same currency.

Now if you want to make the argument that Chinese buyers aren’t real investors, OK. But I just don’t see why an American, who has the long arm of the IRS to deal with even if he emigrates to NZ, would want to buy because of this.

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

>There are actually quite of few of them, including a country that takes twice as many immigrants from China as we do.

are you suggesting that the US is feeling the impact of HAM more than us? because that would be really silly. they have 10 times our population and are able to absorb those migrants much more easily than us. i shouldn’t have to explain this to you.

southseacompany
Member
southseacompany
“San Francisco’s ‘housing crisis’ is reaching epic proportions”, Business Insider http://www.businessinsider.com/san-franciscos-epic-housing-crisis-2015-8#ixzz3jC1JdnSL “The median house price in San Francisco has jumped 103% since the first quarter 2012 to $1.35 million in July; the median condo price has jumped 74% to $1.125 million. These aren’t palaces; condos include 1-bedroom and smaller units!” “And incomes in San Francisco, it turns out, haven’t soared in lockstep. A similar scenario has played out in other Bay Area counties. And thus housing affordability has plunged. “Housing crisis” – that’s what a lot of people call it.” “And there is another needle approaching the bubble. Paragon’s Carlisle: Interest rates play an enormous role in affordability, and it is certainly reasonable to be concerned that affordability percentages are now hitting such depths while interest rates are also close to historic lows. For example, in 2007, when affordability percentages… Read more »
realist
Member
realist

@ 25 patriotz “For a true investor, a falling currency don’t make an investment cheaper if the earnings are in the same currency”

Of course you are correct, however several other considerations:
1. most PRC purchases are for purposes of any one or combination of convenience, safety, or money-laundering, rather than ROI, i.e., not “real investors” in your strict sense.
2. some sophisticated investors might be engaging in simultaneous currency speculation.
3. most unsophisticated investors look only at purchase price, today! just like everywhere else.

I believe most Americans buy NZ residential property because of Lord of the Rings…!

southseacompany
Member
southseacompany

“As China, Greece risks fade, investors look to next hurdle: Will Janet Yellen raise rates in September?”, Financial Post

http://business.financialpost.com/investing/global-investor/as-china-greece-risks-fade-investors-look-to-next-hurdle-will-janet-yellen-raise-rates-in-september

“Investors can now turn their attention to just about the only thing that matters to markets anymore: what a particular central banker is going to decide next month.”

“Just to be clear, this is not about Stephen Poloz. Yes, it’s good sport to try to predict the unpredictable and handicap the Bank of Canada’s next interest rate move. But the fact is, it probably doesn’t matter very much what he does.”

southseacompany
Member
southseacompany
MikeS
Member
MikeS

Okay, weird. My previous post didn’t go through.

https://pbs.twimg.com/media/CMtRmYcVEAAWqpO.png

This shows Home Ownership Rates for a bunch of countries plotted against Price/Income ratios. I’ll see if it posts this time before linking to the sources. The relationship is statistically significant if we control for Asian countries, where things are very odd.

Tiger
Guest
Tiger

B.C. home sales are expected to hit 100,000 units this year for only the third time since the Multiple Listings Service started keeping records.

http://www.vancitybuzz.com/2015/08/bc-home-sales-hit-record-high/

Jimmy
Guest
Jimmy

I’m as bearish as anyone, but one needs a sense of humour when you see a 2012 Maclean’s magazine at your dentist “You’re About to Get Burned”, with a picture of a burning house on the cover.

https://vreaa.files.wordpress.com/2012/02/1330021858_1.jpg

Since then a Van house is up average about $350,000.

MikeS
Member
MikeS

Wow this site sure has quieted down recently. Not even WSR to prop up the post-count.

Rates rise in the US in a month. Should be interesting times.

realist
Member
realist
Not so far south as Auckland, but similar story about home prices heading north. If you substitute Vancouver for San Francisco in most of the article, it still makes sense: “Housing Affordability in San Francisco & Bay Area Plunges; Stocks, Interest Rates Could Trigger Epic Bust” from Wolf Richter/ Wolf Street http://wolfstreet.com/2015/08/16/housing-affordability-san-francisco-bay-area-plunges-stocks-interest-rates-to-trigger-epic-bust/ “The median house price in San Francisco has jumped 103% since the first quarter 2012 to $1.35 million in July; the median condo price has jumped 74% to $1.125 million. These aren’t palaces; condos include 1-bedroom and smaller units! And incomes in San Francisco, it turns out, haven’t soared in lockstep…” Of interest is the author’s addendum in response to a comment suggesting money exiting China is a driver of price escalation: “Here’s some info on this topic. I left it out of the article because in SF… Read more »
realist
Member
realist

@27 Southseacompany

Sorry – @35 follows on your previous post, and was meant to contain only the addendum to the article by the author, Wolf Richter, concerning foreign purchasers.

patriotz
Member

@35:

SF is still a lot cheaper than Vancouver. For example:

http://www.zillow.com/homes/for_sale/15198140_zpid/37.746456,-122.414174,37.686368,-122.520175_rect/13_zm/0_mmm/?view=map

This is very good neighbourhood. Look at the school ratings.

GreenSalad
Guest
GreenSalad

Chinese Investors Pouring Money Into Texas Real Estate

California is still a Chinese favorite, but high prices there are cutting into demand. While Texas ranks third for all international home buyer demand, behind Florida and California, it is favored by Chinese buyers, thanks to its strong employment and education opportunities. Chinese accounted for 31 percent of international sales in Texas in the past year, second only to Latin American/Mexican buyers.

http://www.nbcnews.com/business/real-estate/chinese-investors-pouring-money-texas-real-estate-n399746

paulb
Member

New Listings 214
Price Changes 63
Sold Listings 186
TI:12280

http://www.paulboenisch.com

Sales of sfh falling
Guest
Sales of sfh falling

Less and less detached sales..also more selling under asking. Fact

Whistler or bust?
Guest
Whistler or bust?

Texas ranks third for all international home buyer demand, behind Florida and California, it is favoured by Chinese buyers.

I wonder if the feeling is mutual?

w
Guest
w

“Rates rise in the US in a month.”

I’ll belive it when I see it.

Shut It Down Already
Guest
Shut It Down Already

SF also has much higher property taxes. For that Zillow link, it’s about 3x higher than a roughly equivalent place in Vancouver. Over $1k a month. That would cover a decent chunk of mortgage interest 😉

Whore-city
Guest
Whore-city

5/6 SFH sold in West Van were bought by Chinese Realtors. One for $9 M. I am 100% certain that they were all bought with legit earned and tax-paid money

History
Guest
History

meh, the big big Macau gaming houses were downgraded today in HK

“Citigroup reduced Macau’s gaming revenue forecast for August, Daiwa even downgraded Macau’s gaming sector outlook to Negative and cut the industry’s gaming revenue forecast for this year.”

Shut It Down Already
Guest
Shut It Down Already

Whore-city, you mean “realtors with Chinese-sounding names” rather than “Chinese realtors”?

vangrl
Member
vangrl

#44
Whore-City

How could you possibly know that?

Although it wouldn’t surprise me.

patriotz
Member

@41: “I wonder if the feeling is mutual? (Texas/China)”

Texas has no state income tax and as a consequence has among the highest property tax rates in the US. So why not let some foreigner buy a house and help pay for your kids’ schooling, roads, etc.?