Author Topic: Garth Turner - Real Estate in Canada  (Read 493385 times)

permabear

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Re: Garth Turner - Real Estate in Canada
« Reply #570 on: November 02, 2015, 12:08:54 PM »
Our RE situation scares the crap out of me. It seems like we've learned nothing from the near miss in 2008 and the disaster south of the border.

The Canadian government quietly propped up the banking industry in 2008-10. So yeah, the 'near miss' was more like kicking the can down the road. Haven't read this report yet, but apparently the banks received $114bn in support from gov't and CIBC, BMO and Scotia were all underwater!

Summary: https://www.policyalternatives.ca/newsroom/updates/study-reveals-secret-canadian-bank-bailout
Full report: https://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2012/04/Big%20Banks%20Big%20Secret.pdf

I know it's old news (published in April 2012). If this version of events has since been debunked, would love to hear an explanation.


gokou3

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Re: Garth Turner - Real Estate in Canada
« Reply #571 on: November 02, 2015, 12:41:03 PM »
http://www.vancouversun.com/business/bank+mortgages+bags+cash+behind+chinese+home+buys+vancouver/11485324/story.html?__lsa=5235-1262

Study confirms what I have stated several times. 82% of the so called houses bought by new rich Chinese investors are done using financing rather than cash.

As a newcomer in Canada one needs no job, no income or credit to borrow. The so called rich immigrants have been playing with other peoples money and loving it.

Meanwhile....

How mortgage fraud is thriving in Canada's hot housing market
http://www.theglobeandmail.com/report-on-business/economy/housing/mortgage-fraud-on-the-rise-among-brokers-trying-to-help-clients-qualify/article27051297/




rb

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Re: Garth Turner - Real Estate in Canada
« Reply #572 on: November 02, 2015, 07:20:22 PM »
Our RE situation scares the crap out of me. It seems like we've learned nothing from the near miss in 2008 and the disaster south of the border.

The Canadian government quietly propped up the banking industry in 2008-10. So yeah, the 'near miss' was more like kicking the can down the road. Haven't read this report yet, but apparently the banks received $114bn in support from gov't and CIBC, BMO and Scotia were all underwater!

Summary: https://www.policyalternatives.ca/newsroom/updates/study-reveals-secret-canadian-bank-bailout
Full report: https://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2012/04/Big%20Banks%20Big%20Secret.pdf

I know it's old news (published in April 2012). If this version of events has since been debunked, would love to hear an explanation.
I've read it. The report is worthless. Yes liquidity programs were used but the conclusions the authors draw are erroneous. At first I thought the authors weren't that much aware of monetary and bank funding operations but as I kept reading I realized that they were just being disingenuous.

Aberhound

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Re: Garth Turner - Real Estate in Canada
« Reply #573 on: November 07, 2015, 07:24:28 PM »


Swedish property prices effect of zirp and Nirp. Coming to Vancouver?

When marijuana is legalized soon and you can grow the stuff yourself your worries will seem to drift away.
« Last Edit: November 08, 2015, 11:53:07 AM by Aberhound »

RichardGibbons

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Re: Garth Turner - Real Estate in Canada
« Reply #574 on: November 08, 2015, 08:21:00 PM »
Vancouver single family homes are already up far more than this chart in roughly half the time period.  That said, they could go up more.

Phoenix01

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Re: Garth Turner - Real Estate in Canada
« Reply #575 on: November 11, 2015, 07:17:13 PM »
Let me apologize if this has already been posted.  I found the following presentation that is a little dated but very relevant:
http://www.slideshare.net/ndsouza22/the-big-short-ii

I also really enjoyed this article:
http://www.fool.ca/2014/12/02/10-jaw-dropping-numbers-from-canadas-real-estate-market-2/

In summary, the price appreciation of real estate in Canada is a result of higher lending.  The income to support that lending has not kept up and lending is at a saturation point.  It can't go much higher.  Calgary is a good example of what to expect.

http://www.bnn.ca/News/2015/11/10/Empty-floors-shadow-vacancies-new-norm-for-Calgary-tower-owners.aspx

Libs

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Re: Garth Turner - Real Estate in Canada
« Reply #576 on: March 03, 2016, 09:01:32 AM »
http://www.theglobeandmail.com/news/investigations/the-real-estate-technique-fuelling-vancouvers-housing-market/article28634868/

Nice summary of the shenanigans realtors pull in Canada ( esp Vancouver).

A) Realtor sells A's house to B.
B ) Realtor invokes the assignment clause, and buys it himself
C ) Flips to someone else at a profit.

Legal, but scummy. Note the 500+ outraged comments to get a sense of how things are boiling over.
My username is not a political statement.....and I'm too lazy to change it.

RichardGibbons

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Re: Garth Turner - Real Estate in Canada
« Reply #577 on: March 03, 2016, 10:41:05 PM »
Legal, but scummy.

I don't actually see why this is scummy (and I tend to have very strong opinions about real estate). As long as the agent wasn't representing the original seller, I don't see the problem.

Like, once the deal is signed, the original seller has got what they want, and the buyer has all the risk.  Would it still be scummy if the market dropped, and the agent sold the assignment for a $200,000 loss rather than a $200,000 gain?

Is it scummy if a market maker in the stock market buys shares for you for $10, and then sells them 30 seconds later for $10.10? 

I don't see any real difference.  I think that this issue is simply media-created outrage over something that's actually ethical (and kind of stupid for the agent to do.) 

The people want to blame someone for the ridiculous Vancouver housing prices, so would prefer to blame agents rather than the stupid people buying houses that they can't actually afford, the Bank of Canada trying to keep the bubble economy alive by pumping debt into the system through low interest rates, and CMHC lubricating the system by pushing a healthy dose of moral hazard onto the banks.

Viking

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Re: Garth Turner - Real Estate in Canada
« Reply #578 on: March 03, 2016, 10:56:25 PM »
I live in greater Vancouver (Langley). 2,350 sq ft houses sold for $600,000 six years ago. Two years ago they sold for $700,00. Last year it was $750,000. This year a house was listed for $850 and it sold for $1,030 (it is now affectionately referred to as the 'million dollar house'). My neighbour recently listed their house at $938,000; they had 40 people though, multiple offers, and a final offer of $983,000. Most of buyers are Asian looking to get their $ out of China. Total blows me away to see prices going up one hunded thousand dollars each year for many years. Hard to see how this is not a bubble.

The crazy thing is the flow of $ from China is expected to continue so we may very well see prices go even higher. Vancouver is such a small city it does not take much demand from China to cause prices to spike. Both of my new neighbours are from China (very nice families and great neighbours). :-)
« Last Edit: March 03, 2016, 10:59:41 PM by Viking »

wisdom

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Re: Garth Turner - Real Estate in Canada
« Reply #579 on: March 03, 2016, 11:23:00 PM »
Interesting fact - permanent residents from China to BC are down 50% in the last 10 years.

City of Vancouver expects a 1,000 demolition permits this year. Could it be developers who own those properties. From what I understand there are a lot of individuals who have become builders and a lot of them own anywhere from 2 to 20 properties that they re- develop. Could this be the reason for the shortage in supply and crazy prices?
« Last Edit: March 03, 2016, 11:26:53 PM by wisdom »