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Baby, we got a bubble!?

Coltaine79 said:
5 yr mortgage rates went down again today. Back to 3.99%! yay! (well, I don't need one, but...)
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This is interesting. Often we've seen the mortgage rates lead the BofC rate. I wonder if the BofC is going to hold the line on rates in July while most are expecting an increase.

We know Canada was pushing for more budgetary control at the G20 and seemed to make some progress. Perhaps as a concession we were asked to hold the line on our rates in return to incurr some inflation. 100% speculation on my part, but bears watching.

If you want to make gobs of money in an inflationary environment with low interest rates i don't need to tell you where your money needs to be.
 
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myfive said:
This is interesting. Often we've seen the mortgage rates lead the BofC rate. I wonder if the BofC is going to hold the line on rates in July while most are expecting an increase.

We know Canada was pushing for more budgetary control at the G20 and seemed to make some progress. Perhaps as a concession we were asked to hold the line on our rates in return to incurr some inflation. 100% speculation on my part, but bears watching.

If you want to make gobs of money in an inflationary environment with low interest rates i don't need to tell you where your money needs to be.
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I would bet on the rate hike in July just because the report was so strong. If not in July, it will be at the next meeting. I think Carney may take a breather to see but he will at least go up once and most likely in July to show some consistency and suggest to the market that he is not knee jerk reacting every month. the market does not like uncertainty.

I believe he will go up and state in the notes that he will observe the world in general when making future decisions.
 
urbandreamer said:
I swear tons of those jobs are temporary gov't and student jobs. I know at least 5000 ppl got gov't jobs in the past month--I work with them. I predict come September the jobs are gone!
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In the financial post today, they show a graph with 2007 as the base year. (100). Part time jobs are at 108. Full time jobs at 102. so this would suggest if i am reading it correctly that since 2007,80% of the job growth has been part time jobs and only 20% full time jobs. Of course, this is not comparing to the job loss period of 2008-2009 but to 2007.

It supports your hypothesis.

the article also eludes to economists saying the latter part of the year will slow down, that the growth rate is not sustainable, and that we cannot continue to be an island untouched when Japan, Europe, and the US are all struggling.
 
KA1 said:
http://www.theglobeandmail.com/repo...nas-latest-export-home-buyers/article1638953/

Link to an article in today's The Globe and Mail.
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From the article:

'Barbara Lawlor, president of Baker Real Estate in Toronto, said about 10 per cent of her sales involve foreign buyers. She tends to work with international agents, rather than directly with the foreigners, as most tend to shop from their own countries and make the purchase sight unseen.'


Finally we have a number! Baker does a lot of the sales for the downtown condo start-ups and i was always curious as to the percentage of foreign buyers scooping up units. 10% sounds about right i guess, though i might have estimated higher. But it also shows that it is not the Int'l investor driving this move, they are only a small part of it.
 
myfive said:
From the article:

'Barbara Lawlor, president of Baker Real Estate in Toronto, said about 10 per cent of her sales involve foreign buyers. She tends to work with international agents, rather than directly with the foreigners, as most tend to shop from their own countries and make the purchase sight unseen.'


Finally we have a number! Baker does a lot of the sales for the downtown condo start-ups and i was always curious as to the percentage of foreign buyers scooping up units. 10% sounds about right i guess, though i might have estimated higher. But it also shows that it is not the Int'l investor driving this move, they are only a small part of it.
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i have to disagree with it


for example, i was a visa student from china 8 years ago, now i become a canadian permanent resident. i own two condos here registered under my name but the money comes from my parents in china. so am i considered a foreign investor??

there are many many cases like mine.
 
zhouyanca said:
i have to disagree with it


for example, i was a visa student from china 8 years ago, now i become a canadian permanent resident. i own two condos here registered under my name but the money comes from my parents in china. so am i considered a foreign investor??

there are many many cases like mine.
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Excellent point! I had wondered myself whether there were other such instances when i read that 10%. For example, if a Foreign resident set up an Ontario Numbered company to buy real estate with, does that count as a canadian or foreign purchase? I think the line may be grey here. I know anoher guy like you that bought at CASA for about $350k. He was just a 20ish year old guy, but paid in full cash! Got the money from the parents in China. This would likely go as a canadian purchase but the essence of it is a foreign purchase.

Thanks for bringing this up. I'm inclined to go with my earlier instincts and say the number is more like 15% or towards 20% (maybe too high) of foreign purchasers.
 
What all this means to the prices of 'upscale' condos -- do they buck the trend towards lower prices? Will appreciate thoughts of any and all
 
KA1 said:
What all this means to the prices of 'upscale' condos -- do they buck the trend towards lower prices? Will appreciate thoughts of any and all
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Unless we are going to fully rewrite history, the high end upscale condos usually get hit even more than lower end. Now, it is possible if all these foreign buyers want upscale product that it will hold its value in the short term vis a vis the lower/mid market, but historically, people with investment money scale back on their investments and tend to do so earlier than the general population realizes. They do this as they are often in business and get a sense of the slowing economy or see it in their work place/or their sales. They are more attune to a worsening environment than the average working individual who tends to see it somewhat later as he/she does not see sales falling off as quickly or delay in accounts receivables, or slowing future sales.
I would be suprised if there is a slowdown that upscale will buck the trend. In fact, I would look for it to lead rather than follow the trend.
 
KA1 said:
http://www.theglobeandmail.com/repo...ng-sales-fall-sharply-in-june/article1640760/

Link to an article in today's The Globe and Mail.
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This is not a suprise to most on this forum. Inventory at nearly 7 months from just 2 months about 4-5 months ago. Of course prices will soften to reflect this.

This is the start of a correction but I still believe it will descend and possibly retest 2007-2008 levels but I do not see a further descent barring some outside force jolt (Example large increase in mortgage rates). I am sure others however see this as the start of a major decline (more than 25%-30%) from current prices. While I subscribe to 10-20%, I am not convinced it will hit 30% as others on the forum have been predicting though alot are feeling vindicated at this point in time.

However before we get ahead of our selves, let's get a few of more months of data though I am quite sure it will confirm a downward trend. The interesting thing will be how fast it goes down and then how long does it decline for.

One other comment relating to the previous article about the Foreign Investment. I stated previously that this concerned me as these represent the last comers to the party as it were. When local demand has peaked or is peaking, and foreign investors are the last one's driving the market (whether one buys the 10% figure or believes it to be higher), one has to question where there is further potential to support the market, let alone push it upwards.

I wonder if our realtor colleagues on the forum will still be expounding "that things can/will only go up and this is a pause before the next/continued bull market in realestate and a buying opportunity.
 
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