06-04-2016, 12:30 PM
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#3081
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Appealing my suspension
Join Date: Sep 2002
Location: Just outside Enemy Lines
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I see the Toronto real estate market had a record May. If that house of cards falls it will drag down the entire economy. With that marketwhere it is, I haveto think a .5% increase in rates could be catostrophic for the economy.
Whatever is happening in Calgary or Alberta for that matter is pretty insignificant.
__________________
"Some guys like old balls"
Patriots QB Tom Brady
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06-04-2016, 12:41 PM
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#3082
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Franchise Player
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Quote:
Originally Posted by Sylvanfan
I see the Toronto real estate market had a record May. If that house of cards falls it will drag down the entire economy. With that marketwhere it is, I haveto think a .5% increase in rates could be catostrophic for the economy.
Whatever is happening in Calgary or Alberta for that matter is pretty insignificant.
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Another thing that is interesting and potentially troubling is the news from Scotiabank this past week. They are taking a cautious position on lending in Vancouver and Toronto and have been cutting back on their mortgage positions in those markets. The CEO has also apparently been talking with the folks in Ottawa about increasing the requirements for down payments again. They seem to be moving towards a bursting bubble position.
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06-04-2016, 05:19 PM
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#3083
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Lifetime Suspension
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double post.
Last edited by Flamenspiel; 06-04-2016 at 05:33 PM.
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06-04-2016, 05:24 PM
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#3084
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Lifetime Suspension
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BNN had a graph showing that Toronto housing prices have not really gone up in US dollar terms and simply matched the US currency bubble. The jist of it was that housing had not really gone up from foreign investors perspective.
In addition 1st time buyers are finding it impossible to move up to the second home as the condo price increases have been very modest compared to a fully detached home. The differential between condos and detached homes in Toronto is reaching historical records.
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06-04-2016, 09:39 PM
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#3085
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Franchise Player
Join Date: Dec 2006
Location: Calgary, Alberta
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Quote:
Originally Posted by Flamenspiel
BNN had a graph showing that Toronto housing prices have not really gone up in US dollar terms and simply matched the US currency bubble. The jist of it was that housing had not really gone up from foreign investors perspective.
In addition 1st time buyers are finding it impossible to move up to the second home as the condo price increases have been very modest compared to a fully detached home. The differential between condos and detached homes in Toronto is reaching historical records.
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What US currency bubble are you referring to though? I don't know if this seems to qualify, and I'm not researching this tonight, but I would hazard a guess that we're around the mean as far as USD/CAD?
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06-05-2016, 08:10 AM
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#3086
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Franchise Player
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I think you could call the USD/CAD peak in January this year a bubble. But I don't see how it correlates to the Toronto real estate market. Is foreign interest that high in TO as well?
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08-29-2016, 09:31 AM
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#3088
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First Line Centre
Join Date: Oct 2004
Location: Lethbridge
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^Many Canadian mortgages are CMHC backed, so not sure what he means there.
CMHC has also has sold "bulk" insurance to lenders, so many mortgages not insured by the borrower may have been insured by the lender.
Conventional mortgages (at least 20% down) are non-recourse in Alberta.
Real estate is local. I have no doubt the lower mainland BC real estate market is headed for trouble.
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08-29-2016, 10:02 AM
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#3089
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Franchise Player
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Quote:
Originally Posted by OMG!WTF!
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Predicting a 1.60 exchange rate with the USD seems extremely crazy although that could be really good for manufacturing/exporting jobs and possibly the O&G industry. Has the exchange rate ever been that bad before though? I think that the worst I remember was around 1.40.
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08-29-2016, 10:07 AM
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#3090
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Powerplay Quarterback
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Quote:
Originally Posted by automaton 3
^Many Canadian mortgages are CMHC backed, so not sure what he means there.
CMHC has also has sold "bulk" insurance to lenders, so many mortgages not insured by the borrower may have been insured by the lender.
Conventional mortgages (at least 20% down) are non-recourse in Alberta.
Real estate is local. I have no doubt the lower mainland BC real estate market is headed for trouble.
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Those were my thoughts as well. That is a shotty article. I'm not saying there isn't real estate risk or general debt risk in Canada, but to say we in for worse than 2008 US is ignoring a lot of facts. I predict a small, but long market correction.
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08-29-2016, 10:28 AM
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#3091
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Self Imposed Exile
Join Date: Jul 2008
Location: Calgary
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Quote:
Originally Posted by pseudoreality
Those were my thoughts as well. That is a shotty article. I'm not saying there isn't real estate risk or general debt risk in Canada, but to say we in for worse than 2008 US is ignoring a lot of facts. I predict a small, but long market correction.
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Surprised?
Quote:
RT, originally Russia Today, is a television network funded by the Russian government.
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https://en.wikipedia.org/wiki/RT_(TV_network)
Quote:
RT has frequently been called a propaganda outlet for the Russian government[12][13][14] and its foreign policy[12][14][15][16] by news reporters,[17][18] including former RT reporters.[19][20][21] RT has also been accused of spreading disinformation.[18][22][23][24][25] The United Kingdom media regulator, Ofcom, has repeatedly found RT to have breached rules on impartiality, and of broadcasting "materially misleading" content.[26][27][28] RT states that it offers a Russian perspective on global events.[3]
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08-29-2016, 10:31 AM
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#3092
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Franchise Player
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So safe to say OMG!WFT! is a Communist Russian spy?
I bet he helped the Russians during the Wannamaker campaign too!
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08-29-2016, 10:39 AM
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#3093
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Franchise Player
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Quote:
Originally Posted by automaton 3
^Many Canadian mortgages are CMHC backed, so not sure what he means there.
CMHC has also has sold "bulk" insurance to lenders, so many mortgages not insured by the borrower may have been insured by the lender.
Conventional mortgages (at least 20% down) are non-recourse in Alberta.
Real estate is local. I have no doubt the lower mainland BC real estate market is headed for trouble.
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I think the point was that generally full recourse mortgages are worse for the over all economy. They encourage lenders to loan even in bubble scenarios. And the resulting deficiency judgments can wreck havoc on recovering economies. I've read that 90% of loans in Canada a recourse loans.
Alternatively in Alberta we have these relatively unusual non recourse loans which puts our property values more at risk in a macro economy that is struggling with recourse loan fallout. Just seems like a bad place to be. The worst of both worlds.
Also CAD at $1.40 seems fairly inevitable with likely interest rate increases in the US interest rate and decreases more likely in Canada's interest rates. That plus increasing Canadian debt, worsening GDP, I think $1.40 is generous.
On the bright side I've been working in Kelowna and have encountered several Asians heading west to buy property. Maybe we'll get some Vancouver tax fallout.
Oh and i think the source of the article is cnbc but literally thousands of news outlets will run it. I just copied the first one I Google'd.
Last edited by OMG!WTF!; 08-29-2016 at 10:44 AM.
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08-29-2016, 10:59 AM
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#3094
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In the Sin Bin
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What a splendid time I picked to grow up...
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08-29-2016, 11:00 AM
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#3095
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#1 Goaltender
Join Date: Feb 2012
Location: Calgary
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Quote:
Originally Posted by polak
What a splendid time I picked to grow up...
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Bubbles and busts happen all of the time. It is almost as if it is a cycle...
__________________
From HFBoard oiler fan, in analyzing MacT's management:
O.K. there has been a lot of talk on whether or not MacTavish has actually done a good job for us, most fans on this board are very basic in their analysis and I feel would change their opinion entirely if the team was successful.
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08-29-2016, 11:03 AM
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#3096
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In the Sin Bin
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Quote:
Originally Posted by Fighting Banana Slug
Bubbles and busts happen all of the time. It is almost as if it is a cycle...
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Would you rather be 25, starting a life at the beginning of a bubble, or at the end of a bubble?
O'well, nothing we can do about it. I'm going to start a repo company.
Last edited by polak; 08-29-2016 at 11:05 AM.
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08-29-2016, 11:12 AM
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#3097
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#1 Goaltender
Join Date: Feb 2012
Location: Calgary
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Quote:
Originally Posted by polak
Would you rather be 25, starting a life at the beginning of a bubble, or at the end of a bubble?
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I'd rather be 25 period.
The thing with bubbles/cycles, is that you don't often know where you are, until it is over.
Cool story bro time: I bought my first house in 1998. The market was super hot and had been so for a few years. I felt like I had missed my opportunity to buy, because prices seemed insane and supply was gobbled up in days, if not hours. Finally did pull the trigger, about 15% higher than I wanted to go and instantly felt sick about it. I was convinced that I would be the guy that bought in Calgary and lost money.
Purchase Price: $180k for a bungalow in Altadore on a 50 ft lot.
Moral: Have a decent down payment, forecast for higher interest rates, understand your finances/needs, and buying real estate is unlikely to be a bad deal for you.
__________________
From HFBoard oiler fan, in analyzing MacT's management:
O.K. there has been a lot of talk on whether or not MacTavish has actually done a good job for us, most fans on this board are very basic in their analysis and I feel would change their opinion entirely if the team was successful.
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08-29-2016, 12:24 PM
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#3098
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Franchise Player
Join Date: Jan 2010
Location: east van
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Quote:
Originally Posted by Fighting Banana Slug
I'd rather be 25 period.
The thing with bubbles/cycles, is that you don't often know where you are, until it is over.
Cool story bro time: I bought my first house in 1998. The market was super hot and had been so for a few years. I felt like I had missed my opportunity to buy, because prices seemed insane and supply was gobbled up in days, if not hours. Finally did pull the trigger, about 15% higher than I wanted to go and instantly felt sick about it. I was convinced that I would be the guy that bought in Calgary and lost money.
Purchase Price: $180k for a bungalow in Altadore on a 50 ft lot.
Moral: Have a decent down payment, forecast for higher interest rates, understand your finances/needs, and buying real estate is unlikely to be a bad deal for you.
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I can remember wringing my hands and sweating over buying my house in East Van in 1999, 250,000 for old timer seemed absurd but I needed a house to run my foster home out of.
My only advise, buy cheap old crappy houses, you lose less in a crash but get all the advantages of a bubble.
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08-29-2016, 12:47 PM
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#3099
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Lifetime Suspension
Join Date: Jul 2012
Location: North America
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08-29-2016, 01:16 PM
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#3100
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First Line Centre
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Quote:
Originally Posted by Yoho
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Here is the thing about this article. Mortgages in arrears have increased, but the total of mortgages in arrears is 0.33%. For comparison, the peak for Alberta in the last 25 years is 0.84% in early 2011.
Also for comparison, the US total mortgages in arrears at the start of 2007 was 2%, 3.69% at the start of 2008, and peaked at 11.26% of all mortgages in 2010.
Over 10% of all mortgages in the entirety of the US was in arrears in 2010. Let that sink in for a second. We are at 0.33% in the middle of one of the longest recessions in Alberta's history.
We still have a long ways to go before we see anything significant...people don't understand just how big of a house of cards the US mortgage industry was built upon.
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