Canada Housing/Debt: Trust me, I'm a landlord.

The Something Awful Forums > Discussion > Debate & Discussion > Canada Housing/Debt: Trust me, I'm a landlord.

sbaldrick: Jul 19, 2006; Driven by Hate

According to the Economist, Vancouver is only the 49th most expensive city in the world.

You all have work to do.

http://www.economist.com/blogs/graphicdetail/2016/03/uptown-top-ranking

# ? Mar 11, 2016 00:32

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# ? May 9, 2024 21:47

PittTheElder: Feb 13, 2012; Yes, it's like a lava lamp.

A 2,500 ft residential tower.

# ? Mar 11, 2016 00:53

yippee cahier: Mar 28, 2005

Lifting density or height restrictions is not even in the same neighbourhood as SR&ED corporate welfare.

# ? Mar 11, 2016 01:06

Pixelboy: Sep 13, 2005; Now, I know what you're thinking...

Lexicon posted:

What happens in a few more weeks?

The rally won't last.

# ? Mar 11, 2016 02:39

Femtosecond: Aug 2, 2003

Baronjutter posted:

LNG raises house prices?? Someone should tell BC this, we could invest in LNG and keep prices going UP!

I bet there's lots of people up North that bought land speculating that LNG was going to create 100,000 jobs that are freaking out now that it looks like LNG is going to be a total bust.

# ? Mar 11, 2016 03:04

ocrumsprug: Sep 23, 2010; by LITERALLY AN ADMIN

Femtosecond posted:

I bet there's lots of people up North that bought land speculating that LNG was going to create 100,000 jobs that are freaking out now that it looks like LNG is going to be a total bust.

My spouse works with people that have a bunch of people with Kitimat investment properties (lol), and Site C investment properties (probably ok, but then LOL).

# ? Mar 11, 2016 04:16

the talent deficit: Dec 20, 2003; self-deprecation is a very british trait, and problems can arise when the british attempt to do so with a foreign culture

Femtosecond posted:

I bet there's lots of people up North that bought land speculating that LNG was going to create 100,000 jobs that are freaking out now that it looks like LNG is going to be a total bust.

I know a guy who built six spec houses in Fort Nelson expecting to retire off the sale price once LNG kicks off. Obviously, he works in the industry so he's probably going to lose them all since he can't make the mortgage payments on them now that work has dried up.

# ? Mar 11, 2016 05:06

I would blow Dane Cook: Dec 26, 2008; Can't post for 19 hours!

https://www.youtube.com/watch?v=CVxsfvkMOCA

So an Australian Real Estate firm went public on the share market and it didn't go well.

# ? Mar 11, 2016 06:41

Baronjutter: Dec 31, 2007; "Tiny Trains"

ocrumsprug posted:

My spouse works with people that have a bunch of people with Kitimat investment properties (lol), and Site C investment properties (probably ok, but then LOL).

Yep, personally I know a guy who bought a bunch of houses in Kitimat and he bought them after the initially shot up. But they'll shoot up EVEN MORE once it all gets built.

# ? Mar 11, 2016 08:21

The Butcher: Apr 20, 2005; Well, at least we tried.; Nap Ghost

It's not true that buying a house in van without crossing a bridge or tunnel is impossible.

Just found this lovely and affordable subdivision on the flank of Burnaby Mountain. It's even bordering a golf course!

# ? Mar 11, 2016 09:23

MiddleOne: Feb 17, 2011

Freezer posted:

Have negative interest rates had the intended effect anywhere they have been attempted?

Nooooope, but every central bank seems to be in the mindset that "if it didn't work the first time it was because we didn't do it hard enough". :sweden:

# ? Mar 11, 2016 09:49

Rime: Nov 2, 2011; by Games Forum

The Butcher posted:

It's not true that buying a house in van without crossing a bridge or tunnel is impossible.

Just found this lovely and affordable subdivision on the flank of Burnaby Mountain. It's even bordering a golf course!

You didn't check Realtor.ca $1.7 Million

:chord:

# ? Mar 11, 2016 10:17

Reince Penis: Nov 15, 2007; by R. Guyovich

PittTheElder posted:

A 2,500 ft residential tower.

Earthquake zones seem like the perfect place to test out this kind of super building architecture. :downs:

# ? Mar 11, 2016 16:06

Risky Bisquick: Jan 18, 2008; PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.; Buglord

quote:

http://www.cbc.ca/news/canada/calgary/february-jobs-alberta-rate-unemployment-statscan-1.3486879

UPDATED
Alberta unemployment rate reaches decades-high 7.9%

That is 1% over Ontario. Debt delinquency rates in Alberta are also rising sharply. How many more months before the RE sector in Alberta goes bust.

# ? Mar 11, 2016 16:11

Crowbite: Apr 9, 2015

jm20 posted:

That is 1% over Ontario. Debt delinquency rates in Alberta are also rising sharply. How many more months before the RE sector in Alberta goes bust.

Soon I hope. My lease runs out in June and I'd likely to negotiate a much better rate.

# ? Mar 11, 2016 17:11

Guest2553: Aug 3, 2012

Moving to ON in a few months, would like for this bitch to crash and burn so I can score cheap rents (to help offset the 5000% increase in utilities). Also have this xpost from BWM money because it's prettymuch synonymous with Canada at this point.

Check out this dumb motherfucker who is trading on margin but doesn't even know what it is!

quote:

Recently noticed a sale of some stocks I owned without my authorization. The activity on the transaction says "Unsolicited Sellout". At the time of the sale, I had a negative cash balance with a positive balance in equity in this stock. The transaction particularly hurts as the stock was sold at an 88% loss.

RBC had not contacted me about requiring settlement on the cash balance in any way, either by phone, email, messaging to my online account, or mail. Needless to say, this is a surprise to me.

Upon calling RBC, the customer service rep had indicated that they had attempted to contact me by mail on February 23, which I'm guessing the notice will show up in my mailbox the coming days. RBC indicated that they were within their right to do so based on "the agreement", and that the deal was final.

Do I have any options here given what I believe is the lack of communication from the bank on this matter? Or am I hooped?

He later asked about the viability of legal action but has since deleted the comment.

lol

# ? Mar 11, 2016 17:39

triplexpac: Mar 24, 2007; 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

These are always fun: http://torontolife.com/real-estate/houses/the-chase-trinity-bellwoods-semi/

quote:

The Chase: With $1 million in hand, two Vancouver expats set out to buy a semi in Trinity Bellwoods

# ? Mar 11, 2016 19:23

namaste friends: Sep 18, 2004; by Smythe

Remember when a million dollars was a lot of money?

# ? Mar 11, 2016 19:25

triplexpac: Mar 24, 2007; 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

Cultural Imperial posted:

Remember when a million dollars was a lot of money?

Growing up I thought a million dollars should get you the house from Fresh Prince of Bel Air

# ? Mar 11, 2016 19:27

cowofwar: Jul 30, 2002; by Athanatos

triplexpac posted:

These are always fun: http://torontolife.com/real-estate/houses/the-chase-trinity-bellwoods-semi/

quote:

�For whatever reason, we were the only bidders,� says Alden. �It was the first time we felt like we were in control of the process.� They offered $979,900, and then eventually settled on $1,010,000�only slightly over budget.

They sure drive a hard bargain!

# ? Mar 11, 2016 19:28

cowofwar: Jul 30, 2002; by Athanatos

Apparently Hamilton has little over a month's inventory of SFH for sale. It is a terrible time to be a buyer in a seller's market. We got in cheap so I'm looking at adding a second story to our existing one story addition with foundation since the cost of moving up houses would dwarf the cost of the reno. Especially since we own it outright now without a mortgage which is nice.

# ? Mar 11, 2016 19:33

Fuzzy Mammal: Aug 15, 2001; Lipstick Apathy

Haha holy poo poo I went to elementary and high school with that girl. That's nuts.

# ? Mar 11, 2016 19:38

Postess with the Mostest: Apr 4, 2007; Arabian nights
'neath Arabian moons
A fool off his guard
could fall and fall hard
out there on the dunes

cowofwar posted:

Apparently Hamilton has little over a month's inventory of SFH for sale. It is a terrible time to be a buyer in a seller's market. We got in cheap so I'm looking at adding a second story to our existing one story addition with foundation since the cost of moving up houses would dwarf the cost of the reno. Especially since we own it outright now without a mortgage which is nice.

Oh so that's what a humblebrag looks like without the humble bit.

# ? Mar 11, 2016 19:38

Lexicon: Jul 29, 2003; I had a beer with Stephen Harper once and now I like him.

Ikantski posted:

Oh so that's what a humblebrag looks like without the humble bit.

Hardly fair. It was just a statement of fact.

# ? Mar 11, 2016 19:47

Jenny of Oldstones: Jul 24, 2002; Queen of dragonflies

Clearly, we are living in the wrong city/country.

http://www.trulia.com/property/3203919167-702-W-Main-St-Crawfordsville-IN-47933#photo-16 Pretty much my dream house without some of the crazy wallpaper.

# ? Mar 11, 2016 19:52

cowofwar: Jul 30, 2002; by Athanatos

http://www.cbc.ca/news/business/debt-income-1.3486811

Debt to income ratio now at 165%, interestingly mortgage component growth rate is still peaking. Let's go full-speed ahead off that cliff.

Also China is putting a major brake on currency outflows with lots of reports of serious problems getting money out of China. Oil, however is going back up despite growth in unemployment so there may not be enough of a liquidity crunch to pop the bubble.

# ? Mar 11, 2016 19:54

Baronjutter: Dec 31, 2007; "Tiny Trains"

Vancouver finally bought that rail corridor. Was hoping CP would hold out for more and start parking freight trains behind the condos.
http://bc.ctvnews.ca/vancouver-buys-arbutus-corridor-from-cp-rail-for-55m-1.2806976
CP was smart this time and added in that they get a share of any land sold at least.

# ? Mar 11, 2016 20:15

Risky Bisquick: Jan 18, 2008; PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.; Buglord

Baronjutter posted:

Vancouver finally bought that rail corridor. Was hoping CP would hold out for more and start parking freight trains behind the condos.
http://bc.ctvnews.ca/vancouver-buys-arbutus-corridor-from-cp-rail-for-55m-1.2806976
CP was smart this time and added in that they get a share of any land sold at least.

They get a cash payment now, and money if they redevelop it and sell it as residential later. The City of Vancouver are basically land speculators in this deal granted they can make rezoning happen if they really needed to.

# ? Mar 11, 2016 20:23

MiddleOne: Feb 17, 2011

Cultural Imperial posted:

Remember when a million dollars was a lot of money?

You know even with inflation it still is.

Just not in Canada.

# ? Mar 11, 2016 20:32

namaste friends: Sep 18, 2004; by Smythe

zerohedge wrote a non-poo poo level quality post about canada's housing market.

http://www.zerohedge.com/news/2016-03-11/canadian-housing-mortgage-investment-corporations-%E2%80%93-time-worry

I found this section illuminating.

quote:

The Mortgage Market

As of May 2015, the total amount of mortgages outstanding was $1.5 trillion, 87% of which was residential. The vast majority (85-90%) of these mortgages are originated by federally or provincially regulated entities. Only ~5% are originated by unregulated lenders. Still, mortgage credit growth at less-regulated entities continues to be strong.

This is worrisome because, for these lenders, there are no legislated reserve requirements or limitations on LTV ratios. As such, it is reasonable to assume that they deal with riskier mortgages.

Mortgage Investment Corporations

Mortgage investment corporations (MICs) account for the majority of unregulated mortgage lending in Canada. Fundamental Research Corporation built a database of 72 entities that operate as MICs or have similar structures. They found that their total holdings amount to at least $6.74 billion or 0.45% of the total market. MICs specialize in short term (6 to 24 months), high yield mortgages. At least 40% of their assets must be invested in residential mortgages, cash and CDIC insured deposits. They pay no corporate tax and act as a flow through entity � i.e. they payout 100% of their income as distributions to investors (who are left with the tax burden). As such, the value of their shares should remain the same unless they suffer capital losses. MICs earn interest and fees (origination, renewal and cancelation) from borrowers. In order to fund themselves, MICs borrow from banks and issue equity to investors.

We consider MICs riskier than other housing derivatives for reasons we will address later in this paper. Still, there are multiple differences between firms. We are building a proprietary database which compares both private and public MICs on a variety of metrics. Here is a brief summary of our findings:

MICs vary in terms of�

Fund size: Some public firms are closing in on $500 million AUM while other private ones have fewer than $50 million under management
The number of loans: Some firms have hundreds of them while others have fewer than 30
Allocations towards first and second mortgages: First mortgages are safer than second mortgages because they represent a priority claim on the property that secures the mortgage
Average loan-to-value ratios (LTV): Range from ~35% to >70%
Average loan size: Ranges from <$100,000 to $7,500,000
Average term: Ranges from 0.6 to 4.9 years
Geographic exposure: Most companies tend to focus on Ontario, but to varying degrees
Like all investments, MICs vary in quality. Some are geared to maximize income while others emphasize capital preservation. Even so, we are cautious on the space as a whole. The two biggest risks for MICs are non-performing loans (NPLs) and fraud. These firms have been performing well in recent years; however, it is important to consider the underlying fundamentals of real estate in general. The Canadian housing market has been in a bull market for a long time. If unemployment rises and home prices fall then it is reasonable to assume that the number of NPLs will increase. Fraud is also an elevated risk because of the lack of oversight in the unregulated market � both on the lending side and the investment side.

We are also skeptical about MICs for structural reasons. One issue is that they are reliant on financing to grow. In addition, managers have an incentive to grow their asset base because they are mostly paid based on AUM. Since all profits are paid out, asset growth has to come from making new loans. This makes MICs vulnerable to falling demand from investors, rising borrowing and financing costs and waning support from the banks.

Another problem is a lack of loan-loss reserves. The Office of the Superintendent of Finance (OSFI), the regulator overseeing the MIC structure, requires that substantially all profits are paid out to investors, leaving little in the way of reserves to protect against defaults. If defaults rise then mortgage values will be impaired and MICs will have limited means to protect their holdings. In our opinion, that would result in immediate gating (when the fund does not allow redemptions). For example, one of the firms we looked at had a $3.6 million provision for losses at the end of Q3�15 vs. $459 million of mortgages receivable.

# ? Mar 11, 2016 21:00

my morning jackass: Aug 24, 2009

cowofwar posted:

Apparently Hamilton has little over a month's inventory of SFH for sale. It is a terrible time to be a buyer in a seller's market. We got in cheap so I'm looking at adding a second story to our existing one story addition with foundation since the cost of moving up houses would dwarf the cost of the reno. Especially since we own it outright now without a mortgage which is nice.

Hamilton is insane and a perfect example of why the statement "the bubble only impacts Toronto and Vancouver" is unfounded. Prices in most neighbourhoods in the core have skyrocketed as a result of increased demand from Toronto transplants. The past few years have seen double digit increases year over year, with decent neighbourhoods have seen astronomical increases in a very short time.

A lot of teardowns happening in my neighbourhood, and a lot of people buying investment properties to flip. The bidding wars have also come here hard over the past year. I have been saving up for a down payment but it's kinda futile, as my down payment proportion as a percentage of a mortgage basically is not really getting any better.

my morning jackass fucked around with this message at 21:50 on Mar 11, 2016

# ? Mar 11, 2016 21:46

namaste friends: Sep 18, 2004; by Smythe

If we were in a bubble where everyone was gripped by a mania to buy a house, do you think you would even be able to tell you'd been taken over by such a mania? Or do you think you'd still think you were rational?

# ? Mar 11, 2016 21:56

namaste friends: Sep 18, 2004; by Smythe

http://vancouver.24hrs.ca/2016/03/10/richmond-school-closures-coming-in-2017

quote:

Richmond School District will be closing as many as five schools on June 30, 2017, with the names of the potential schools to be closed revealed next month � the move is being done as part of declining enrolment requirements ordered by the provincial government.

District board chairwoman Debbie Tablotney said on Thursday that staff have prepared five dates in May for the public to review a preliminary list of the three to five schools that will be closed, with a vote by the board of trustees anticipated in October this year.

She said, generally, schools that would be considered for closure are at least 25% under-capacity. The district would also examine whether the students at the school are from within or out of catchment. The age, need for repairs, and seismic stability of each school would also be considered.

For example, seven schools in the district currently require �significant repairs,� and 21 schools are considered at high risk to earthquakes.

One example of an underused school, Tablotney said, would be Sea Island Elementary, which serves kindergarten to Grade 3 students � and is technically an annex of Brighouse Elementary.

Parents of students at the annex have written the board, saying that despite how the annex has operating costs 388% higher than the district average, there are six other schools that cost even more.

The school has a capacity of 195 students, but only 30 currently attend.

�That sounds bad � but it�s not a fair assessment of our capacity, when you consider that five rooms at the school are used by other organizations,� reads the letter, signed by approximately 40 nearby households.

hahah what the gently caress richmond is closing schools.

# ? Mar 11, 2016 21:59

The Butcher: Apr 20, 2005; Well, at least we tried.; Nap Ghost

Rime posted:

You didn't check Realtor.ca $1.7 Million

That's nuts. I wouldn't live there for free. Downhill from a tank farm... What could ever go wrong?

Then again I'd never even buy on a floodplain either so maybe I'm just a wimp.

# ? Mar 11, 2016 22:01

cowofwar: Jul 30, 2002; by Athanatos

my morning jackass posted:

Hamilton is insane and a perfect example of why the statement "the bubble only impacts Toronto and Vancouver" is unfounded. Prices in most neighbourhoods in the core have skyrocketed as a result of increased demand from Toronto transplants. The past few years have seen double digit increases year over year, with decent neighbourhoods have seen astronomical increases in a very short time.

A lot of teardowns happening in my neighbourhood, and a lot of people buying investment properties to flip. The bidding wars have also come here hard over the past year. I have been saving up for a down payment but it's kinda futile, as my down payment proportion as a percentage of a mortgage basically is not really getting any better.

James St Area is up like 88% year over year. I thought houses were over valued when we bought in 2012. Looking at the history of our house it had been stable around $100k for a long time and then it changed hands a couple times and climbed up rapidly before we got it at $300k.

# ? Mar 11, 2016 22:03

mojo1701a: Oct 9, 2008; Oh, yeah. Loud and clear. Emphasis on LOUD!
~ David Lee Roth

my morning jackass posted:

Hamilton is insane and a perfect example of why the statement "the bubble only impacts Toronto and Vancouver" is unfounded. Prices in most neighbourhoods in the core have skyrocketed as a result of increased demand from Toronto transplants. The past few years have seen double digit increases year over year, with decent neighbourhoods have seen astronomical increases in a very short time.

A lot of teardowns happening in my neighbourhood, and a lot of people buying investment properties to flip. The bidding wars have also come here hard over the past year. I have been saving up for a down payment but it's kinda futile, as my down payment proportion as a percentage of a mortgage basically is not really getting any better.

So how hosed am I if I'm looking for a place to rent?

# ? Mar 11, 2016 22:07

ocrumsprug: Sep 23, 2010; by LITERALLY AN ADMIN

The Butcher posted:

That's nuts. I wouldn't live there for free. Downhill from a tank farm... What could ever go wrong?

Then again I'd never even buy on a floodplain either so maybe I'm just a wimp.

That little patch of houses is bounded on three sides by industrial/tank farms.

I think you just need to lower your expectations about what $1.7 million gets you, you big entitled millennial baby.

# ? Mar 11, 2016 22:10

Risky Bisquick: Jan 18, 2008; PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.; Buglord

People that would traditionally be in Mississauga because they were priced out of Toronto are being pushed to Georgetown, Milton, and Burlington. These areas have appreciated 50% in value over 5 years for single family homes despite having new developments every year. The 'Toronto' housing bubble.

Anywhere along the GO lines are appreciating like crazy. You're talking 60-90 minute commutes each way and people buying housing at 600k+ right now.

# ? Mar 11, 2016 22:12

Majuju: Dec 30, 2006; I had a beer with Stephen Miller once and now I like him.

@ Femtosecond and anyone else interested:

Poking Holes in Vancouver's Housing Study

quote:

The study, which was intended to finally illuminate both city hall and residents on the extent of empty housing in Vancouver, was anti-climactic, to say the least. It reported that a mere one per cent of single-family homes were empty, a figure that hasn�t budged much since 2002. The overall vacancy rate was at 4.8 per cent. Only condo vacancies raised an eyebrow, at around 10,000 units. So what happened?

The answer to that question is far more nuanced than the report�s use of BC Hydro electricity data can provide. The author of the study, Bruce Townson, is frank about the study�s limitations � and there are several.

Houses that had the electricity turned off � such as old houses that sit empty as they await permits for demolition and redevelopment � were not counted in the study. They were only counted after electrical service had been restored for a full year. In this market, there have been many cases of homes sitting empty, without electricity, awaiting redevelopment. Considering that there are 950 house demolition permits taken out on average each year, that�s potentially a high number of houses that didn�t make the cut. Many newly built houses were also exempt. They too were only considered empty once the electricity was turned on, and remained on, for one year.

Houses that only have visitors during summer months were counted as occupied. Houses that sit empty but have a caretaker come by and generate electricity use at least five times a month were also considered occupied. And a house with the lights on timers and a housekeeper or maintenance person who comes by and uses the electricity, were also counted as lived in.

�If you have timers on at the same time, day to day, but then Jerry comes in and introduces a load on Wednesday and introduces high electricity use for a couple of hours, and leaves, then that would be occupied, based on the data we have,� said Mr. Townson.

As well, the study did not include data from 2015, which was a record year for Vancouver real estate. From January, 2015 to January, 2016, the average house price soared 46 per cent, all the way up to $2.87-million. In Vancouver proper, the benchmark price for a detached house hit a record $1.94-million in January, or a 26-per-cent gain from a year earlier.

�This is not out of design; this is out of the limitation of data,� says Mr. Townson.

# ? Mar 11, 2016 22:12

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# ? May 9, 2024 21:47

Yeast Confection: Oct 7, 2005

mojo1701a posted:

So how hosed am I if I'm looking for a place to rent?

In Hamilton, rent isn't bad and there's a pretty wide variety of rentals available. Prices are still reasonable.

# ? Mar 11, 2016 22:18

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