- tsa
- Feb 3, 2014
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The whole foreign ownership is also a red herring.
Similar to Canada it's local investor speculation, negative gearing and other factors being the main factor for the housing ubble.
The key thing to keep in mind that bubbles are mob mentality, it takes very little to start a stampede and a lot to stop it. There's also the 'monopoly money' effect - the market gets distorted by one group placing a much higher marginal value on each dollar than the other. If you are a billionaire a thousand dollars is literally nothing in other words. The difference between a million dollar house and a 1.1 million dollar one is essentially irrelevant, so there's no downward pressure on prices. Anyway, it's hard to tell what exactly is going on due to the lack of data, it is certainly possible that the foreign money could been (have been) the primary driver of price increases, while easy credit for Canadians is what is sustaining these higher prices. Besides that, not being the biggest factor doesn't mean it isn't a factor. The problem many are making is that they think there needs to be a large amount of foreign cash coming in for there to be a large effect. This simply is not the case, it's much better to think of housing as a carefully balanced scale, it only takes a small amount to send the scale crashing in one direction.
Example: In the beginning you might just have tiny areas with large amounts of foreign capital driving up the prices in desirable regions. This then has the potential of spilling over to other surrounding regions. As people observe people making a lot of money from doing nothing but sitting on a house then others jump in the game. Of course at this stage you need easy credit to fuel the fire which the banks are happy to provide, but the bubble can be self-sustaining at this point. Honestly it would be rather interesting to study, I wish there was more public data on it.
This is a weird comparison but you can look at something like Quinoa, even a small increase in foreign consumption has made it unaffordable for many people in the regions it was traditionally grown and consumed. The situation is analgous in that both times you have a small groups of people with wildly different marginal values on money.
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Jun 2, 2015 16:59
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- Adbot
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ADBOT LOVES YOU
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May 12, 2024 14:43
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- PT6A
- Jan 5, 2006
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Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane
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Every once in a while I look at new condos in my area, that start at $350k if you want a bedroom with a window, and end up going home completely happy with my 1970s condo. It's shameful what people have been conditioned to accept as passable, let alone luxury.
Out of curiosity, why do you want a bedroom with a window? My bedroom for the past month didn't have a window, and it resulted in less light coming in and less noise from street level. Here at home, I keep the bedroom curtain down all the time anyway. It's not like I'm going to sit in my bedroom and appreciate the lovely view: I go there to sleep, gently caress, and dress myself. The window is either neutral or unhelpful for all those things.
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Jun 3, 2015 00:28
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- Postess with the Mostest
- Apr 4, 2007
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Arabian nights
'neath Arabian moons
A fool off his guard
could fall and fall hard
out there on the dunes
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At that price, the bedroom is the only room.
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Jun 3, 2015 01:03
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- JBark
- Jun 27, 2000
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Good passwords are a good idea.
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Ever found yourself wondering how effective the foreign ownership laws are in Australia? As you probably guessed, they really don't make a difference. As Jumpingmanjim posted earlier, since there are no money laundering requirements in regards to real estate here, it's laughably easy to bypass the requirements. For example, the most sought after home in likely the entire country was bought illegally for $52M a couple year ago by simply funneling the money through a regular family trust in the names of an elderly couple. You can basically bold the whole thing.
http://news.domain.com.au/domain/real-estate-news/point-pipers-altona-mansion-sale-dodged-foreign-investment-laws-20150603-ghfheb.html
quote:Point Piper's Altona mansion sale dodged foreign investment laws
The mystery owner of Australia's most famous trophy home, Altona in Sydney's Point Piper, is a Chinese property developer who concealed his investment behind an elderly Melbourne couple to avoid foreign investment laws.
Fairfax can reveal that businessman Wang Zhijun paid $52 million for the harbourside mansion through a complex holding structure of shelf companies and holding trusts, including opaque nominee arrangements stretching from the Melbourne suburb of Elwood to the British Virgin Islands.
The revelation solves the most talked-about riddle in Australian real estate but raises major questions about the growing tide of offshore money washing into Australian real estate.
It comes as Treasurer Joe Hockey has vowed to enforce foreign investment laws and international anti-money laundering agencies have warned about loopholes which exempt real estate from onerous disclosure requirements.
On Tuesday lawyers for Mr Wang's interests took Fairfax Media to the Victorian Supreme Court in an unsuccessful attempt to prevent publication of this story.
Fairfax can now reveal Mr Wang did not have permanent residency when he bought Altona two years ago, despite laws preventing foreigners from buying established housing.
Mr Wang's identity has emerged as he contests a million-dollar land tax bill and grapples with an Australian Tax Office probe.
Speculation around Altona's owner has bubbled ever since the property changed hands two years ago, with the media and regulatory scrutiny weighing heavily on the Melbourne family that fronted for Mr Wang.
Chaimovich Investments, the company used to buy the property, was set up just two weeks before the sale. Its sole director and shareholder, is Ding Xiuzhen, an anonymous septuagenarian who lives in Elwood.
So little was known about the supposed owner that she has long-been incorrectly referred to in media reports as a man. But Fairfax has learned that the 77-year-old grandmother has never been to Sydney, let alone set foot in the trophy home she purportedly purchased.
She is a distant relative of Mr Wang's from the same city, Qingdao, on the coast of Shandong province in North China.
Chaimovich Investments is a trustee company for a discretionary family trust, of which Ms Ding's elderly husband Chang Fu'an was listed as sole beneficiary.
Ms Ding's daughter Holly Chang spoke to Fairfax Media after the paper trail connecting her family with the iconic Sydney landmark was revealed.
"It was only a matter of time," said Ms Chang, expressing relief that the deception was over. "We don't want to feel like we have to hide."
Ms Chang confirmed the true owners are in fact 43-year-old property developer Wang Zhijun and his wife Guan Hongyan.
Ms Chang said the Wang family had wanted to buy the property in their own names but because FIRB approval would make any exchange conditional they were advised to make the purchase in a family trust structure.
Ms Chang said the Wangs had also inspected Villa Del Mare, which was the subject of a Fairfax investigation on Monday, but had their heart set on Altona.
"They saw another [property], the one that sold for $39 million … Villa del Mare," Ms Chang said. "But they didn't like it."
"They loved Altona," she said. "They liked Altona and they wanted to seal the deal, so they set up a family trust with my mother as the director.
"They had applied for FIRB but the family trust structure means they didn't need it."
Fairfax understands Mr Wang held a temporary 457 work visa at the time of settlement, rather than permanent residency or Australian citizenship.
Foreign purchases of existing homes require FIRB approval.
Mr Wang is virtually unknown to the public, including in China.
The reclusive businessman heads Qingdao Anteisin Group which has interests extending from luxury residential property developments to mines and golf resorts in mainland China.
Through one of his British Virgin Island holding companies, Mr Wang is also the 75 per cent shareholder and chairman of Vision Fame, a Hong Kong-listed construction and property maintenance company. The group's business spans Hong Kong, Singapore and Macau, where it has had maintenance contracts with James Packer's Crown Towers and City of Dreams.
The biographical information on Mr Wang on Vision Fame's annual reports is unusually brief, offering little more than that he "has been a businessman for over 10 years" and holds an interest in a Singapore metals trading firm.
Fairfax Media has also seen copies of lodged trust declarations naming Mr Wang and a British Virgin Island company as sole beneficiaries at separate times. It is understood these documents were drafted to secure a $20 million loan from the Bank of Melbourne to support a local development, using the Point Piper home as collateral.
Ms Chang's brother Victor Shengli Chang refused to comment on why the property was bought through a family trust.
He also declined to offer any details about Mr Wang, playing down the influence of a man who was able to stump up a record price for an Australian residential property.
"We are nobody," Mr Chang said. "There's no mystery about any of it."
Mr Wang has since become an Australian permanent resident. In correspondence from March this year seen by Fairfax Media, his representative makes instructions to alter the trust deed to reflect Mr Wang as the sole beneficiary of the Chaimovich trust.
"Because Zhijun Wang has become PR, FIRB will not an issue anymore [sic]," the email reads.
On Tuesday night Fairfax agreed to a temporary injunction order restraining publication of a letter dated January this year or information obtained as a consequence of that letter.
The vendor of Altona, former teenage magazine publishing industry entrepreneur Deke Miskin, said the sale had been straightforward from his end. "We negotiated the price, they wanted some furniture included, we negotiated that and through it all they acted very honourably and they were very decent and upright people to deal with," he said.
Until recently, foreign investment laws were only loosely enforced by FIRB. In March, however, Mr Hockey stunned the real estate world by forcing another Chinese property developer, Xu Jiayin, to sell another harbourfront Point Piper mansion, the $39 million Villa Del Mare, because it was bought in contravention to foreign ownership rules.
A spokeswoman from the Treasurer Joe Hockey's office said they were unaware of any issues surrounding the purchase of Altona.
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Jun 3, 2015 02:47
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- I would blow Dane Cook
- Dec 26, 2008
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Probably wouldn't be hard to do other things like use a shell corporation to do all the home purchases
That's how villa de mare was purchased until the FIRB forced them to sell it (and they made a 1 million $ profit).
And now a story from a realtor:
quote:
The three-bedroom, single level house in Sydney’s Seaforth was nice, but it was nothing special. Set on just 550sqm it is below the average size for a free standing house in Sydney. The rooms were bordering on the small side. The bathrooms were small. There was no garage or even a carport. Just a small spot in the open for a car. There were no views. Importantly parts of the house had been renovated PRIOR to the existing vendors who only bought less than 12 months back.
They had bought it in June 2014 for $1,350,000. From a professional basis I was very curious. Just what would a property that sold just less than 12 months ago, with no capital improvements added under the current owner, sell for today?
Mainly I was there to help my friend. With a new family and a good business, he is doing well in life and now is the time to settle in with a home. Nevertheless, even with all the good things going for him and his partner, they had been struggling for some time to buy into the Sydney property market.
I gave my good friend everything I had. We went through the current SQM valuation and most recent leading indicators. All up, the current local market evidence for Seaforth suggested a move higher of somewhere around 15% for this property since last year.
To start with, things were ominous – for the last four weeks, Sydney’s auction clearance rates had been at close to record highs. Worse, listings in Seaforth fell to their all-time lows in April – just 20 houses listed. So, after taking that into account, I thought the market might be bordering on a 20% rise, which would place this property at absolutely no more than $1,620,000 and more likely around $1,550,000.
Most certainly, the advertised ‘price guide’ of $1,350,000 (which represented last year’s sold price) was WAY below the mark. Most who turned up to the auction that day knew it.
Bidding started off at $1.4m and rose fairly quickly in $10K to $20K increments. There were five active bidders. A Caucasian looking couple, a buyer’s agent with his female client. And three separate Asian groups, who appeared to be of Chinese descent. One of them was Australian Chinese going by the accent. Plus, my friend.
My friend took the strategy advised to wait and not bid until the last two bidders had weakened and virtually knocked each other out. Then go HARD…right up to his limit. His limit was $1.6m.
The poor bastard didn’t get a bid in.
After just some moments, the bids arrived at $1,550,000. At that point, the bidding briefly stalled. A question from the crowd was thrown at the auctioneer. “Had the property reached the RESERVE?” The agent did not show his hand. He only responded that he would ask the vendor at the right time. Bidding resumed.
In a space of another minute we were at my friend’s limit…then over. The buyer’s agent who initially took the correct strategy of showing no weakness, faltered in the end, though it wasn’t his fault. Bidding had gone beyond the current market. His client walked away in disgust and loathing at what was taking place, even before the end was out.
In the end it was down to two bidders. The Australian-born Chinese husband and wife, and a young woman, who also seemed to be of Chinese decent. They kept each other in the game, stalling and lobbying in $1K and $5k increments. Auction bidding stalled again at $1,620,000, at which point the agent declared the property was selling as it had exceeded the vendor’s reserve. Once that happened, bidding started again and it kept going…and going. Until finally the young looking Chinese woman won out…at $1,720,000.
A full 27% price rise from its selling point not more than 12 month ago.
The woman of Chinese descent, who spoke in broken English, would not have been more than 30 years old. She was bidding alone. She was never on the phone and from what I could see, there was no one else there supporting her…other than the agent egging her on!
You could tell even at this price she was agitated. She had bought over her budget or at least the top range of what she wanted to pay. She had paid 27% over what it sold for only last year.
And that was it. The crowd gasped. The unsuccessful bidders, saddened and angry, walked away, wondering what their future was now. There were some claps, presuming from the neighbours; happy to know they too now are nearly multi-millionaires.
And for my mate. What could I do for him? Easy done, we went for a couple of Saturday afternoon drinks to reminisce and, eventually laugh it off – $1.7m for a box? They can have it!
While I have taken a line in the past that the fear of the Chinese pushing up our housing market is just that – fear; when it comes to the heat of the moment it is easy to see why suspicions arise. How does such a person of young age have the money to spend $1.7 million on a house??
There, of course, could be a host of reasons. Maybe she has worked very hard in this country and her local business has done well. Maybe she has recently won the lottery…and then…maybe she is a Chinese student with her parents back at home, using her residency to buy Australian property on their behalf – we will never know.
What I do know is this – the Sydney housing market is now as strong as I have ever seen it. It’s like a wild bushfire – out of control and setting alight everything in its path. Our revised forecasts of 11 to 15% price gains, up from the original 8 to12%, now is looking very conservative.
The action now suggests movements of greater than 20% p.a. at least for houses. This is dangerous stuff.
http://www.macrobusiness.com.au/2015/06/one-day-in-the-life-of-a-sydney-beijing-auction/
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Jun 3, 2015 03:29
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- SpannerX
- Apr 26, 2010
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I had a beer with Stephen Harper once and now I like him.
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Fun Shoe
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Fresh air and sunlight. Gets a bit depressing in this corner of the world without sunlight.
We have a blackout curtain which takes care of the light during sleeping and another lighter one for privacy only. During the day it's wide open.
Also I'm a giant pussy when it comes to humidity so we also have an AC unit that requires exterior ventilation. Looks like that's going back in next week.
It just feels too claustrophobic without a window. But I guess more people feel like you than like me, judging by new condos.
Also, in some places, like, for instance, CANADA, I think you need a window for escape, from, for instance, FIRE.
quote:Question: Bedroom Window - Is it required by the BC Building Code?
Answer: The BC Building Code generally requires every bedroom in a house and every bedroom in a small multi-family residential building to have an outside window that can be used as an emergency exit. The window opening must be 0.35M2 with no dimension less than 380mm.
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Jun 3, 2015 14:19
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- MickeyFinn
- May 8, 2007
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Biggie Smalls and Junior Mafia some mark ass bitches
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How did this Chinese woman amass $1.7m for a house?! MY friend could only manage $1.6m and he is white, so he must be better than her!
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Jun 3, 2015 14:29
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- triplexpac
- Mar 24, 2007
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Suck it
Two tears in a bucket
And then another thing
I'm not the one they'll try their luck with
Hit hard like brass knuckles
See your face through the turnbuckle dude
I got no love for you
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http://www.blogto.com/city/2015/06/house_of_the_week_308_12_wellesley_street_east/
$1.4 million
quote:There's no front entrance in the home. Enter through the side door right into the kitchen or at the back into the living area. With minimal storage for coats and shoes and no hallway, this is no place for a hoarder.
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Jun 3, 2015 14:32
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- HookShot
- Dec 26, 2005
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I appreciate the irony of a blog called macrobusiness where in the last sentence the guy uses a single anecdote to make a statement about an entire market.
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Jun 3, 2015 17:06
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- F1DriverQuidenBerg
- Jan 19, 2014
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I've got a question for you guys. What's going to happen to the low end of the market when the housing bubble bursts?
I bought an extremely cheap condo in Calgary, ($155,000) last year. If the market collapses am I really going to see a major drop if I'm already at the bottom end?
I went way under what I was approved for in my mortgage, if the market drops out pretty bad and my losses aren't too bad I'd probably be looking to upgrade to a small house with a garage.
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Jun 4, 2015 03:22
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- EvilJoven
- Mar 18, 2005
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NOBODY,IN THE HISTORY OF EVER, HAS ASKED OR CARED WHAT CANADA THINKS. YOU ARE NOT A COUNTRY. YOUR MONEY HAS THE QUEEN OF ENGLAND ON IT. IF YOU DIG AROUND IN YOUR BACKYARD, NATIVE SKELETONS WOULD EXPLODE OUT OF YOUR LAWN LIKE THE END OF POLTERGEIST. CANADA IS SO POLITE, EH?
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Fun Shoe
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Whichever rear end in a top hat who thought it'd be a good investment opportunity to fund the construction of a building containing a 2 bedroom 2 bathroom condo listed at over half a million dollars and rented out monthly for $3500 in loving Winnipeg Is the kind of rear end in a top hat who's going to be seriously contemplating suicide when the bubble bursts.
Your little condo that's probably cheaper to own than rent, even with the associated costs, will probably be fine. Just don't expect to sell it and make money.
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Jun 4, 2015 04:06
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- F1DriverQuidenBerg
- Jan 19, 2014
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Your little condo that's probably cheaper to own than rent, even with the associated costs, will probably be fine. Just don't expect to sell it and make money.
Yeah I'm not really considering this a money making venture, but I'm hoping my cards line up and I can get what I bought it for come sale time all things considered. I can improve a few things in my unit and the condo board has basically turned a corner and isn't garbage anymore. They're replacing the carpets in the building and have got a new contractor so the place is going to look decent in the near future.
All in I pay around $1100/month and that includes mortgage, so pretty close if not bang on to what I'd be paying for rent on something similar.
Only reason I'm considering it is if the price of a smaller house or townhouse drops enough it would make a bit of sense to just bit the bullet of all the costs associated with buying and selling so soon after buying.
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Jun 4, 2015 05:20
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- PT6A
- Jan 5, 2006
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Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane
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Not really most of the pain will be for people who bought sky high new luxury condos
Not necessarily. Maybe the $1 mil+ stuff, but I'm guessing the hardest hit is going to be medium-luxury homes ($400k-$700k) in undesirable locations far from downtown. I think downtown and the beltline will be largely resilient, because the location makes them inherently more desirable than something out in Auburn Bay or Ranchlands. Prices will go down, but I don't think you'll see the same decrease close the core that you will further out.
I wouldn't worry about losing too much money on a $155k condo, though, regardless of location. That's pretty affordable regardless of economic conditions, so I wouldn't worry too much about the bottom falling out barring a Detroit-style collapse.
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Jun 4, 2015 15:30
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- F1DriverQuidenBerg
- Jan 19, 2014
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I'm actually aiming for something on the fringe of the city if the market does collapse. Bit of a gamble, but if the market does recover it'll pay off nicely.
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Jun 4, 2015 16:17
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- PT6A
- Jan 5, 2006
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Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane
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I'm actually aiming for something on the fringe of the city if the market does collapse. Bit of a gamble, but if the market does recover it'll pay off nicely.
...why? Living far from everything is horrible, and the recovery will probably be slowest in the least desirable locations, for obvious reasons.
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Jun 4, 2015 16:29
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- F1DriverQuidenBerg
- Jan 19, 2014
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...why? Living far from everything is horrible, and the recovery will probably be slowest in the least desirable locations, for obvious reasons.
Why not? I just want a cheap place with a garage that looks reasonably decent. If something in a nicer area did pop up for the right price I'd go for it, but I'm not going to burn through cash just trying to get a place close to downtown.
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Jun 4, 2015 16:48
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- OhYeah
- Jan 20, 2007
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1. Currently the most prevalent form of decision-making in the western world
2. While you are correct in saying that the society owns
3. You have not for a second demonstrated here why
4. I love the way that you equate "state" with "bureaucracy". Is that how you really feel about the state
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Out of curiosity, why do you want a bedroom with a window? My bedroom for the past month didn't have a window, and it resulted in less light coming in and less noise from street level. Here at home, I keep the bedroom curtain down all the time anyway. It's not like I'm going to sit in my bedroom and appreciate the lovely view: I go there to sleep, gently caress, and dress myself. The window is either neutral or unhelpful for all those things.
What the fuuuuuck? The only room which is OK without a window is a bathroom.
You know you are in trouble when London is rated at 2 and your city is rated at 100.
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Jun 4, 2015 17:17
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- namaste friends
- Sep 18, 2004
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by Smythe
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quote:
American economist Paul Samuelson back in 1966 famously said of the predictive power of stock markets that “Wall Street has correctly predicted nine out of the last five recessions.” These days, you could say much the same thing, in a different way, about the Canadian housing market.
As the Toronto market continues to blaze, nowhere is it hotter than in the detached home category. In the city proper, the average sale price was $1.1 million, 18.2 per cent higher than last year.
Media and some economists have been dutifully predicting a crash in house prices every year since at least since 2010. Yet every year, the market continues to go up, seemingly defying gravity.
In Toronto, we’ve all heard stories of termite-ridden shacks selling for $200,000 above asking. Bidding wars are the norm. Nobody asks for an inspection before signing on the bottom line. Those of us old enough to remember the last Toronto housing crash, in 1989, find it all eerily familiar.
Certainly, those who think the end is nigh will be heartened by the recent surge in home prices.
The Toronto Real Estate Board on Wednesday released data that showed home sales in the Greater Toronto Area rose 6.3 per cent in May from a year earlier, and the average home price rose 11 per cent to nearly $650,000. In the city of Toronto, detached homes were selling for an average of $1.1 million, representing an 18-per-cent increase from a year earlier.
Similar stories are playing out across the country. Nationally, the Canadian Real Estate Association reports that resale home prices rose by 9.5 per cent in the 12 months to April 2015.
Vancouver, the country’s priciest place to buy a home, continues on a tear, and the B.C. Real Estate Association said demand for housing in the province is the highest since 2007.
Even the Calgary market has seen renewed demand, and the Canada Mortgage and Housing Corp. expects residential prices to fall by only 2.9 per cent in 2015. That’s hardly a crash, especially in a city hard hit by crumpled oil prices.
Of course, for the bears, this is all only more evidence that a crash is coming. There is no doubt that there is some froth in the spring market. And yet, if you look more closely, it’s hard to see where or how the sky is about to fall.
For one thing, we like to think that bubbles are inflated by irrational behaviour. But is there anything really irrational about Canadians buying homes for unprecedented prices? Well, no. They are only doing what makes sense: borrowing money when money is cheap.
Still, even with cheap mortgages, you have to pay. And, yes, thanks to rising prices, affordability has come under pressure. RBC said affordability in the Toronto market, for example, appears “stretched relative to historical norms.”
The Toronto Real Estate Board’s affordability index shows that the share of household income that goes to mortgage, property tax and utility payments is around 35 per cent, the highest it’s been in 20 years.
But even at that level, we’re not anywhere near where we were in 1989, when carrying a resale home ate up more than 50 per cent of income, according to TREB.
“Historical norms,” by the way, are hard to read. In 1989, the Bank of Canada benchmark rate reached 12.61 per cent. People were cheerfully buying houses with mortgage rates in the high teens.
Today, the overnight rate is 0.75 per cent. And you can get an 18-month mortgage from one southern Ontario credit union for 1.49 per cent.
In 1990, the central bank raised rates to fight inflation, topping out in May of that year above 14 per cent. It was successful – too successful – in fighting inflation, which dropped well below its target of three per cent as the economy slipped into recession. It took a decade for the Toronto real estate market to recover.
This is a different world.
We started the year with the expectation that rates would go up soon. It’s clear now – even after the surprise January rate cut from the central bank – that they won’t.
The recent terrible GDP growth data for Canada, along with indications that the economy might not pick up in the second half as BoC Governor Stephen Poloz expected, are raising expectations that the next move from the central bank will be another cut, not a hike.
Sure, rates will eventually go up, but that looks more and more likely to happen later rather than sooner.
When interest rate increases do come, they are unlikely to be dramatic. As the U.S. has shown, economic recovery in the new world of low growth is a precarious endeavour.
The U.S. Federal Reserve has pretty much promised that its interest rate increases will be low and slow, whenever they happen.
We can expect the same here in Canada. Not that the BoC’s job is to protect house prices, but let’s face it: it serves nobody’s interests to choke the one segment of the economy that is building wealth for Canadians.
No, the biggest threat to the housing market isn’t an interest rate increase. It’s a good old-fashioned recession – and, technically, thanks to last quarter’s negative GDP growth, we’re already halfway there.
If there is a reversal in the recent trend towards job creation, there could be big downward pressure on housing sales and values. On the other hand, the BoC still has tools at its disposal to free up money and stimulate the economy – which, of course, would be supportive of house prices.
I’m not saying, mind you, that high real estate prices are all good. They are creating a real social problem, because people on the low end of the income curve simply cannot afford to own a home.
I’m not saying, either, that the market won’t correct – some day. But that’s the thing about bears. They’re very good at predicting a downturn will happen. They’re just not very good at telling you when.
http://business.financialpost.com/investing/why-the-sky-is-still-not-falling-on-canadas-real-estate-market
Keep buying houses motherfuckers
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Jun 4, 2015 20:41
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- Risky Bisquick
- Jan 18, 2008
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PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.
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Buglord
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CBC posted:
RBC threatens 'fast foreclosure' to seize Port Coquitlam home
Man hit by misfortune could lose his home of almost four decades because of bank's 'hard-nosed approach'
If it weren't for bad luck, Ron Philbrook wouldn't have any luck at all.
And the Port Coquitlam, B.C., man believes his plight should serve as a cautionary tale for Canadians now carrying record levels of household debt.
CBC News Investigates: More stories, videos, photos, analysis
"I think they're going to be thinking about, 'Wow, if this can happen to this fellow, it could very well happen to us,'" warns Philbrook.
'Fast foreclosure'
The 58-year-old is facing a "fast foreclosure" by the Royal Bank of Canada on his home of 36 years, after he fell on hard times. This is a procedure in which a bank requests authorization to foreclose in 24 hours rather than several months.
The bank's move is taking place even though Philbrook now has a stable job and has made various offers to start paying off his debt.
"I made several repayment proposals to take care of the arrears, and the bank is basically playing hardball, and said 'sorry, we're carefully declining your offer.'"
After CBC became involved, the bank agreed to delay its foreclosure application until later this month.
If the foreclosure happens, it will be the latest blow for Philbrook after being pounded by bad luck.
58 year old Ron Philbrook could soon lose his modest Port Coquitlam condo to foreclosure
58-year-old Ron Philbrook could soon lose his modest Port Coquitlam condo to bank foreclosure. (CBC News)
Bad luck begins
By the 1990s, Philbrook had paid off his Port Coquitlam condo and was planning for his retirement.
He decided to remortgage to buy a recreational property with relatives on Pavilion Lake, between Lillooet and Cache Creek, 300 kilometres northeast of Vancouver.
But in 2011, Philbrook was laid off from his job of 23 years. He burned through $40,000 from his RRSP to keep paying his condo mortgage, but then fell behind and into debt.
That's when disaster struck.
Last August, Ron Philbrook's vacation home on Pavilion Lake was hit by a mudslide
Last August, Philbrook's vacation property on Pavilion Lake, 300 kilometres northeast of Vancouver, was hit by a devastating mudslide. (Courtesy: Ron Philbrook)
Dream 'wiped out'
Last August, torrential rains sparked massive mudslides around Pavilion Lake.
One buried his recreational property beneath tonnes of rock — and filled his cabin with debris.
The property value went from an assessed $156,000, to just $26,000.
His insurance company refused to pay out, declaring the mudslide an act of God — and the province wouldn't pay disaster relief because it was a recreational property, not a primary residence.
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"I was absolutely shocked," recounted Philbrook. "I was saying, 'Oh brother, this is another blow to the gut I definitely don't need."
"I was going to sell my place, for whatever money I could get, and I was going to move up and live (there)."
Royal Bank foreclosure
Now, Philbrook owes $114,000 on his Port Coquitlam condo that's valued at just $95,000.
The Royal Bank has decided to foreclose on his home of 36 years.
hi-rbc-royal-bank
Royal Bank of Canada has given Philbrook a two-week reprieve, delaying a foreclosure application that had been scheduled for June 4.
Normally, the bank would give a homeowner six months to find funds before foreclosing.
RBC has instead applied to B.C. Supreme Court to request Philbrook be given just 24 hours to pay up before the condo can be listed by a real estate agent. Philbrook would be kicked out upon sale of the home.
The bank took this action even though Philbrook found a stable, full-time job last November and has pledged to pay back approximately $500 a month.
"Devastated, I feel devastated," he says. "I've been a very, very loyal customer with them for over three decades. And this is the way they're treating me."
Philbrook's lawyer agrees.
'Hard-nosed approach"
Priyan Samarakoone, a lawyer with the Access Pro-Bono Society BC, says Philbrook is "a hard-working, everyday Joe Canadian," who "deserves a break."
Priyan Samarakoone, lawyer with Access Pro Bono BC, is fighting on behalf of Philbrook
Priyan Samarakoone, lawyer with Access Pro Bono BC, is fighting on behalf of Ron Philbrook. (CBC News)
"I'd like a little wiggle room, I'd like a little flexibility" he says, calling the bank's 24-hour redemption period "a hard-nosed approach."
"What I would like to see is in circumstances when we have an opportunity to save the home, that they work with us ... and not just kind of roll over that person if it's just dollars and cents," He said. "It's that human approach."
Temporary reprieve
After being contacted by CBC News, the Royal Bank of Canada has agreed to soften its position, but is still demanding Philbrook come up with a lump sum payment of $11,000.
It has given him a two-week reprieve, delaying a court application that had been scheduled for June 4.
In an email to CBC, bank spokesperson Ian Colvin writes:
"We are working closely with the client to find a resolution and have taken steps to provide both parties with more time and to review carefully the options available."
But the statement does not say whether RBC will stick to its 24-hour foreclosure application when the case returns to court.
Philbrook is vowing to battle on.
"I'm not going to go down without a fight. I'm going to fight until the absolute bitter end."
http://www.cbc.ca/news/canada/british-columbia/rbc-threatens-fast-foreclosure-to-seize-port-coquitlam-home-1.3099202?cmp=rss
 I thought houses only go up in value, why am I being punished
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Jun 4, 2015 21:00
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- PT6A
- Jan 5, 2006
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Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane
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What the fuuuuuck? The only room which is OK without a window is a bathroom.
You know you are in trouble when London is rated at 2 and your city is rated at 100.
Why do you think a bedroom window is good? Apart from fire safety, I can't think of a single benefit. It's noisier, and I hate light coming in when I'm trying to sleep.
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Jun 5, 2015 01:30
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- namaste friends
- Sep 18, 2004
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by Smythe
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This is a morality take about white trash retirement.
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Jun 5, 2015 01:42
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- Adbot
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ADBOT LOVES YOU
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May 12, 2024 14:43
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- Lexicon
- Jul 29, 2003
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I had a beer with Stephen Harper once and now I like him.
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Why do you think a bedroom window is good? Apart from fire safety, I can't think of a single benefit. It's noisier, and I hate light coming in when I'm trying to sleep.
Most humans like light, especially when they wake up.
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Jun 5, 2015 04:36
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Jun 2, 2015 16:59
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