Pieces posted:

Newfoundland & Labrador goverment pledges 2.5 million/year towards downpayment loans for low to moderate income earners to help them buy a house. 100-125 lucky applicants annually.

http://www.cbc.ca/news/canada/newfoundland-labrador/paul-davis-downpayment-1.3283651

"Can't afford a house? The government will help you take on that pile of debt with an additional loan!"

Surprisingly the commenters are all shooting this down for being a terrible use of tax-payer money and an obvious vote-grab attempt by the PC party of NL.

Jumpingmanjim posted:

Perhaps they should be buying dog houses?

Pieces posted:

Newfoundland & Labrador goverment pledges 2.5 million/year towards downpayment loans for low to moderate income earners to help them buy a house. 100-125 lucky applicants annually.

http://www.cbc.ca/news/canada/newfoundland-labrador/paul-davis-downpayment-1.3283651

"Can't afford a house? The government will help you take on that pile of debt with an additional loan!"

Surprisingly the commenters are all shooting this down for being a terrible use of tax-payer money and an obvious vote-grab attempt by the PC party of NL.

Pieces posted:

Newfoundland & Labrador goverment pledges 2.5 million/year towards downpayment loans for low to moderate income earners to help them buy a house. 100-125 lucky applicants annually.

http://www.cbc.ca/news/canada/newfoundland-labrador/paul-davis-downpayment-1.3283651

"Can't afford a house? The government will help you take on that pile of debt with an additional loan!"

Surprisingly the commenters are all shooting this down for being a terrible use of tax-payer money and an obvious vote-grab attempt by the PC party of NL.

Square Peg posted:

Isn't it, like, fraud to finance a down payment with a loan? Doesn't that defeat the whole point of a down payment?
Dumb dumb dumb.

quote:

The purchase of a home has transcended its status as a financial transaction and instead become both a moral imperative and a conspicuous marker of social virtue, and there’s a whole order of secular priests ready to preach the gospel should anyone’s faith start to wobble. Entire television networks are dedicated to celebrating the various aspects of ownership, from the financial joys of flipping a house to the esthetic pleasures of a well-executed renovation. And you can always count on a well-meaning relative, whose experience with home ownership has almost certainly made them wealthier than they deserve to be, to tell you all about why buying a home is better than renting one. But here’s the thing: it isn’t.

Jumpingmanjim posted:

Can anyone comment on whether banks could (or would) make margin calls on mortgagors in negative equity? Kind of like how it is done with Share trading with margin.

ianmacdo posted:

The banks would not.
If the whole housing market gets hosed the banks would rather have the fake value of the mortgage as a positive on their books rather then the actual value of the house. Plus they would have to pay the property taxes ect...
Remember all those people in the US who got evicted and then the banks didn't follow through on the foreclosure.

ocrumsprug posted:

This is probably not entirely true in Canada. There are federal OSFI requirements regarding loan to value ratios that they need to maintain. In the event of a market collapse in Vancouver, there are going to be a lot of people that are going to need to write a fairly sizable cheque to their bank when their mortgage comes up for renewal.

Square Peg posted:

Isn't it, like, fraud to finance a down payment with a loan? Doesn't that defeat the whole point of a down payment?
Dumb dumb dumb.

Noam Chomsky posted:

Would anyone be so kind as to explain, to an ignorant American, how Stephen Harper had been PM for almost 10 years? He sure seems like a right oval office.

quote:

Fake homeless shelter pops up in affluent Toronto neighbourhood leaving residents in tears

Residents were caught on a hidden camera as part of a stunt to raise awareness about homelessness.

When a notice went up in a wealthy Toronto neighbourhood announcing a homeless shelter would be opening there soon, it upset some local residents so much they cried.

And that was before they learned it was a hidden-camera stunt, set up to publicize the issue of homeless ahead of Election Day.
On Friday, Leaside residents woke up to find a former Sleep Country store on Bayview Avenue covered in construction hoarding. On it, there was a sign announcing the privately-funded Jefferson Homeless Shelter would open on Nov. 1, offering 62 beds and hot meals, run by a volunteer staff of three.

A hole in the in wood siding concealed a hidden camera.

Residents noticed the sign immediately, said Ted Stuebing, who runs the community news outlet The South Bayview Bulldog. Many contacted him and their local councillor with concerns.

“People were very upset, people were crying,” he said.

Stuebing went by the area and spoke with a young lady, who claimed she worked for the shelter. When he told her he didn’t think there were 62 homeless people in the neighbourhood to fill the beds, she said the shelter would bus them in.

That sounds outlandish, but outlandish things do happen, so that doesn’t mean it wasn’t true, he said.
But it wasn’t. On Saturday, a different notice went up.

“You told us you don’t want a shelter here. Neither do we. Support us in creating long-term solutions. Let’s end homelessness,” it said, and gave a link to Raising the Roof’s website.

Advertising agency Leo Burnett is doing some pro-bono work for the charity to dispel common myths and misconceptions around homelessness, said charity director Carolann Barr.

Several cameras hidden around the area captured residents’ reactions to the idea of a having a homeless shelter nearly in their backyards and those reactions will be used in a film that will be released on Oct 12.

“The purpose of that is to release it just before the election, to get voters to really think about homelessness and what their local leaders and federal leaders are doing about that issue,” Barr said.

Residents’ faces will be blurred, she said.

Stuebing said he believes the stunt went off just as planned, eliciting the reactions that the directors hoped for, but it left residents feeling deceived.

As for those who were upset at the idea of homeless people in their neighbourhood, Barr said they hope they learn from the experience that anyone can become homeless in their lives due to circumstance and they shouldn’t fear homeless people.

“I hope they investigate the issue more and realize we all have a role in helping the vulnerable in our society,” she said.

This isn't the charity's first campaign. Raising the Roof is also behind a campaign where real homeless people read out mean tweets about homelessness.

quote:

Mortgage rate rises are too little, too late to save Australia's bloated banking sector

In Australia, the big four banks are joining the mortgage interest rate hike bandwagon to boost additional capital in what is truly a high-risk banking and financial system.

Simply put, when it comes to lending, banks are facilitators. On the front end, banks’ assets are generated by providing credit (debt) to homebuyers and charging a specific rate of interest. On the back end, banks have liabilities derived from depositors and wholesale lenders, fetching an interest rate which is lower than that charged to homebuyers. The banks earn the difference in revenue.

Australian households owe creditors an unconsolidated $1.97tn as of the second quarter of 2015, comprised primarily of mortgages with a remainder of personal loans. Relative to GDP, this amounts to 121.5%, and the proportion increased by 150 basis points every quarter over the past year. Given this historically and internationally large stock of household debt, the banks are earning mega dollars via net interest rate margins.

Related: How the banks ignored the lessons of the crash | Joris Luyendijk

Australian banks are raking in record-breaking profits due to the sheer volume of mortgage debt issued to homebuyers and residential property investors. This is the primary reason housing prices in Australia are at record levels, relative to inflation, rents and household income: a housing bubble generated by debt-financed speculation. Today, our banks are more exposed to the risk of a shock to the housing market than in any other moment in Australia’s economic history.

There are various reasons for banks to increase mortgage interest rates without a shift in the cash rate set by the Reserve Bank. In Australia’s case, policymakers and the prudential regulator, Apra, woke up – 17 years too late. They finally realised our banks would not be able to withstand a financial shock based on the colossal stock of mortgage and other debts on their balance sheets relative to the amount of security they have to defend their businesses in the event of a severe economic downturn.

To improve the ability of the big four banks to weather a financial storm, Apra has told them to hold more capital against the risks they have accumulated by lending out so much debt to the household sector. This explains the raising of capital to marginally reduce the risks inherent to each of their balance sheets, valued into the hundreds of billions of dollars.

Put another way, this would be like asking someone who lives payday to payday with a $400,000 mortgage, earning $70,000 a year with only $10,000 in savings, to put an extra $20 a week away in the kitty. If he or she loses their job, they are then supposed to magically come up with thousands of dollars to continue to fund the mortgage payments and other living expenses while looking for work. It makes no sense because the individual has placed themselves in a situation where they live beyond their means and increasing liquidity buffers will simply not be enough.

For many Australians, it may sound reassuring that Apra is seeking to make the banks fundamentally stronger – but there is bad news. With the implementation of macroprudential regulations, our banks will now go from being as fundamentally weak as the failed Anglo Irish Bank in 2007 to now holding enough capital to rival the risk profile of what was a much safer and famed global financial institution – Lehman Brothers.

In the short term, it’s not going to help and the RBA should have never cut the cash rate to record lows to stimulate the already vastly overvalued and overleveraged housing sector at the cost of screwing depositors. If anything, the big four banks are too big to fail. Their mortgage books are too large to save without nationalisation, regardless of RBA backstops and bailout mechanisms already in place – namely the so-called committed liquidity facility.

According to the Basel agreements that bind banking institutions around the world, banks may make their own internal (opaque) assessments of the future risk of default for home owners. Australia’s big four banks and Apra are particularly fond of this method, and the vast majority of housing loans in the mortgage portfolio are assessed using the internal ratings-based (IRB) approach that allows estimates of probability of default, loss given default and exposure at default.

Related: Today the great Australian dream is owning a home loan (or two) | Greg Jericho

Unfortunately the Basel algorithm to assess a banks internal risk profile is not specifically designed for a banking system so heavily leveraged towards a housing market like Australia’s. Hence the methodology more than likely underestimates the true risks that lie within our banks’ balance sheet while they continue to allow property speculators to increase leverage. A clear example is that buyers can still unlock newly found (but illiquid) equity of properties in their portfolios to be pledged as 20% collateral against a new mortgage for another purchase.

This is a pyramid or Ponzi scheme, that puts the speculator at risk of owing more to a bank than their property portfolio is worth (negative equity). This presents a clear and present danger to the banking and financial system, depositors, taxpayers and welfare of millions of Australians who have borrowed on a large scale as residential land prices escalate. The horse well and truly bolted from the stable a long time ago, and Apra is conducting 11th hour operations to save face.

Noam Chomsky posted:

Would anyone be so kind as to explain, to an ignorant American, how Stephen Harper had been PM for almost 10 years? He sure seems like a right oval office.

Cultural Imperial posted:

The left wing vote is split between the liberals and the NDP. Hence Harper becoming PM with roughly 30% of Canadians actually voting for his party.

quote:

Opinion
Will Trudeau destroy the first-past-the-post ring of power?
Electoral reform would make minority governments and associated co-operation the norm, Alon Weinberg writes

quote:

Justin don't put the ring on.
Despite what Harper tells you, you'll be seduced by it's dark powers.
Take the ring to Mordor, now known as Fort Mac and cast back into to tar sands from where Harper had forged.

Noam Chomsky posted:

Would anyone be so kind as to explain, to an ignorant American, how Stephen Harper had been PM for almost 10 years? He sure seems like a right oval office.

quote:

Buyers ‘crawling over each other’ for Vancouver bungalow

4595 RUPERT ST., VANCOUVER

LISTING PRICE $975,000

SELLING PRICE $1,128,000

DAYS ON MARKET Seven

TAXES $4,471

LISTING AGENT Keith Roy, Re/Max Select Realty

The Action: Listing agent Keith Roy had sold the house a year ago and his client didn’t make any renovations. He held a Thursday night showing for agents and two weekend open houses. He received 13 offers. “After a few rounds of negotiations it finally sold without any conditions,” Mr. Roy said. “There were over 300 people who attended, so they were crawling over each other.”

What They Got: This 2,301-square-foot house has three bedrooms on the main floor and two bedrooms in the basement. Built in 1961, the bungalow is across from a park and close to SkyTrain, shops, Highway 1 and schools. The roof is six years old and the appliances are fairly new. It also has a mountain view.

The Agent’s Take: “The market for housing in East Vancouver is largely driven by a sense of fear that if you don’t buy a house now, you’ll be priced out of the market forever,” Mr. Roy said. “By leveraging that sense of scarcity, we were able to limit showings, drive lots of traffic and get our clients a very healthy return on their investment. Whenever we see [an opportunity] in the market for our clients, we encourage them to take advantage of it.”

quote:

If sellers needed evidence of just how much the market has changed they need look no further than 7 Bloomfield Street, Surry Hills.

In March first-home buyer Doi Kim, 25, took a punt on the derelict one-bedroom terrace, paying a hefty $840,000 – $140,000 above reserve – to secure the home.

But after realising just how small the property was he decided to sell and unwittingly found himself a vendor in a very different market.

Although relieved to see six buyers register to bid on Saturday, Mr Kim knew they would have to dig deep for him to get out financially unscathed. Mr Kim, however, had added considerable value by obtaining development approval to add a second storey to the home.

Auctioneer Matthew Shalhoub from Under The Hammer called for an opening bid with “an eight in front of it” and promptly received it from a young architect, who then entered a bidding duel with another young couple.

Late in the game a serial property investor, who is a plumber by profession, came in with the highest bid of $900,000. Although it was below Mr Kim’s reserve, after some deliberation it was accepted.

The $900,000 sale price was cause for relief, not celebration.

After paying $840,000 Mr Kim spent $34,000 on stamp duty, $6500 on obtaining development approval to add another level, $3000 on painting . He also had other rates and fees.

“I broke even,” he said after the auction.

When asked if he could go back six months would he do it all again he promptly responded “no”.

“The market is getting too slow,” he said.

With backing from his mother, Gina Lim, he has since bought a larger terrace around the corner on Crown Street.

Jumpingmanjim posted:

quote:

All those new builds aren’t all bad, stresses land economist Conway.

Much of the city’s housing stock is aging out and not built to modern standards. They are tiny for today’s families, lack ensuite bathrooms and workable kitchens but, more importantly, they “just aren’t healthy.

“They aren’t insulated properly, some have asbestos and urea-formaldehyde so there’s good reason to rebuild many of them anyway.”

quote:

Households in apartment buildings represented about a quarter (27.2%) of Canadian households. The majority of households (55.0%) lived in single-detached houses. Households in other structure types (row houses, semi-detached houses, duplexes, movable dwellings, and other single-attached dwellings) represented just under a fifth (17.8%) of Canadian households.

eXXon posted:

No ensuite or granite countertops?! No sale!

Jumpingmanjim posted:

http://www.domain.com.au/news/young-buyer-breaks-even-at-auction-by-the-skin-of-his-teeth-20151024-gkhijw/

Jumpingmanjim posted:

http://www.domain.com.au/news/young-buyer-breaks-even-at-auction-by-the-skin-of-his-teeth-20151024-gkhijw/

Lexicon posted:

Heh - I remember this one when it sold last time around. It made international headlines then too.