Matthew_O posted:

So here are some of my personal views:

1) Market metrics like those posted by the OECD analyze the entire Canadian housing market as an aggregate. The problem is Toronto and Vancouver make up a much larger part of our population than New York does of the US. It skews the overall picture.

2) Canada's stature has improved in the international community. It attracts international buyers. The international real estate market in what I consider prestige countries always has a target destination. There is a lot of misinformation with respect to foreign investment: especially from the BC Realtors, who are always downplaying foreign investors. The reality is that Canada now has two prestige markets. Prestige markets are bubbly. Our newly created prestige markets skew things more than they would in other markets.

3) Canada's geography (i.e. very little desirable real estate) lends itself towards higher prices. Real estate should be more expensive in Canada than in the US, all other things being equal.

But here is the real kicker, beyond anything else. Money inflation is high right now. It is keeping wages afloat, it is helping employment numbers, and it is reducing the value of our dollar. Consumer credit is tightening up and already people are having to adjust. The age group getting hit the worst right now are seniors on fixed incomes, and I hate to say this, but they are best able to absorb the impact by changing their standard of living. There was no magic solution out of the 2008 recession: we did a pretty good job of getting out of it without destabilizing the country.

So...thank you housing for saving the day...now we just need to get it under control and land this baby as softly as possible.

Matthew_O posted:

There is nothing naive about your post. I differentiate between the scenarios though.

The financial crisis had the ability to spiral out of control: mass unemployment leads to less spending, leads to businesses not hiring, etc. etc.. In those types of situations, that future consumption could possibly not happen. It is like paying off a credit card with another credit card: it isn't a smart idea, but in many situations it is better than not making a payment and eventually having both cards revoked. Better to keep them afloat until you are able to recover.

Simply said, a timid, guarded public is dangerous for any economy. Yes it creates winners at the expense of those out of the system. But you have to worry yourself about the people still playing the game, not those who have retired from it.

Helsing posted:

None of this, of course, is to say that you're wrong about how disastrous the long term effects of this policy could turn out to be. But there is an underlying logic here that seems to tie into a reliance on housing to help power the economy ever since the great productivity slow down of the 1970s.

Helsing posted:

I didn't say anything about a slump, which would suggest an actual decline in labour productivity, I said that productivity growth has slowed down after its postwar peak...

Cultural Imperial posted:

http://www.theglobeandmail.com/life...rticle21142644/



STOP BEING SO CLUELESS ABOUT MONEY RENTAILURES

etalian posted:

it's a real estate human centipede

Jerkwin posted:

What possible motivation could a person have for buying a house, verses renting one, when prices are deflationary? That sounds like a horrible housing market.

Jerkwin posted:

Renting would make more sense. Why buy a house on Monday when it'll be cheaper on Tuesday?

Lexicon posted:

You simply cannot do this calculation in the absence of inflation and end up with anything approaching a sensible result. You need to calculate it in NPV terms otherwise it's utterly meaningless.

I'm busy right now, but I'll do it later and post the spreadsheet.

mik posted:

Is the rent vs. own dichotomy as it's portrayed in a purely financial sense really only valid in larger cities? My point is, the math assumes the property you rent is equivalent to the property you buy. Somewhere like Toronto obviously there's thousands of condos to rent and thousands of equivalent condos to purchase, but where I live (30k population) there's a distinct line between rental properties (for the poors) which are almost always townhouses or apartments, and detached housing which is pretty much purchase-only. There's no way I would be able to find and rent a house here that would be equivalent to the one I bought, or at the very least the rent would be so high that it would no longer make renting the 'smarter' choice.

It's easy enough to say that factoring in opportunity cost and all the other nuances renting is financially better than buying, but this is predicated on the properties being equivalent in every other way. Is this equivalence a reasonable assumption based on availability in larger cities?

Cultural Imperial posted:

So what would happen if some significant portion of almost a trillion dollars of mortgage debt was forgiven?

Is canada going to be more like another argentina or another mexico?

JawKnee posted:

This sounds remarkably like lowering interest rates to increase the amount of cheap credit available

LemonDrizzle posted:

I think home ownership in general has a respectably positive EV. Per Shiller, the capital value of the property can be expected to hold steady in the long term, and on top of that you get a "dividend" in the form of the imputed rent. In a healthy market, the imputed rent may be 5-7% of the price so even after you take off 1% of the property's value per year for maintenance, you're left with an asset that provides a real return of 4-6% per annum. That's not bad at all, especially since you pay no tax on the return and neither do you pay capital gains tax if/when you sell.

Obviously this is not an argument for buying in a bubble, I am not saying this means that now is a good time to buy in Canada, blah blah blah

LemonDrizzle posted:

That's true but if you buy with a mortgage you can also expect above-inflation capital growth thanks to your leverage. Going off Shiller's statement that houses retain their value in real terms (and assuming that the central bank succeeds in keeping inflation at around the 2% target rate), a house bought for 200k will see its nominal value rise by 4k after the first year of ownership. If you bought with 20% downpayment of 40k, that'd be 10% nominal capital growth for you before you consider other costs; basically, provided that your mortgage payments are not significantly greater than the imputed rent + maintenance costs + relevant taxes, you'll almost certainly come out ahead.

etalian posted:

lol

http://www.ted.com/talks/michael_green_why_we_should_build_wooden_skyscrapers/transcript?language=en

We need to reduce the concrete and steel and we need to grow bigger, and what we've been working on is 30-story tall buildings made of wood. We've been engineering them with an engineer named Eric Karsh who works with me on it, and we've been doing this new work because there are new wood products out there for us to use, and we call them mass timber panels.

These are panels made with young trees, small growth trees, small pieces of wood glued together to make panels that are enormous: eight feet wide, 64 feet long, and of various thicknesses.

Ming the Merciless posted:

I'm new to the thread, so sorry if this a dumb question. With all the bellyaching about the housing bubble, wouldn't there be some indication in the mortgage arrears statistics that things are about to go bad? If people are keeping up with their payments, what difference does it make?

Lexicon posted:

As an alumnus, I often feel disgusted with UBC's constant money-grubbing and empire building behaviour. But then I think "maybe all universities are like this".

I genuinely don't know. But I can't shake the feeling that UBC is uniquely awful.

Kalenn Istarion posted:

So, if I'm reading this right, Hal was just using 'theta decay' to refer to monetary deflation. I'm struggling to parse his post because of the excess of .

tagesschau posted:

Percentage of Toronto condos owned by foreign investors is very low, CMHC says

tagesschau posted:

I think the point is more that high foreign ownership isn't driving up condo prices, because high foreign ownership of condos is not actually a thing.

Kalenn Istarion posted:

Decoy Badger posted:

It provides a snow/windbreak and insulation without jamming an uncomfortably tight hood rim into your cheeks and face. It's incredibly handy when you're out working in -30ish weather - you can get away without having to wear a face wrap until it gets to -40 or so. I use mine when working in the Nunavik winter.

RBC posted:

That's not unusual, you're banking on the lendee paying back the debt over a period of time, not all at once. On a micro level it's not really an issue.

But when your whole population is taking on that much debt, it's a problem. It indicates a population that is not planning for the future and is over leveraged.

etalian posted:

http://www.vancouvercondos.com/

Jerry Manderbilt posted:

There's like 11.4 million STEM degree holders over here who aren't working in STEM.

peter banana posted:

who was asking about rents?

http://www.blogto.com/city/2015/01/many_toronto_renters_spend_half_of_pay_cheques_on_rent/


Ugh. So done with this city. So done with this economy. So done with this country.

OSI bean dip posted:

Nobody should ever pay more than 10-15% of their yearly intake on rent. It is a rule I have stuck to for half a decade now.

Baronjutter posted:

Don't forget it's generally not a single landlord, it's a huge leasing company that leases space on behalf of a ton of building owners. I'm not sure all the specifics, but I've heard of individual owners getting scewed because they signed over control of rates to the huge leasing corporation who are fine sacrificing that building's income for the greater good of keeping prices high in the city/region as a whole. It functions almost like a commercial leasing cartel where supply is restricted to keep prices up.

Cultural Imperial posted:

http://www.reddit.com/r/vancouver/comments/2t5cd5/an_alternative_to_the_hellish_housing_costs_in/

This loving "tiny house movement" cracks me the gently caress up.

Build equity in a 40k outhouse with strata fees. Good job doing the math there hipster mark carney

Cultural Imperial posted:

I'm guessing that thing is 100sqft. That's $400/sqft. C'mon man

Guest2553 posted:

In the spirit of the housing megathread, some mortgage lenders will find themselves up against the wall then the crash comes! Uninsured private mortgages at 5-15% interest for up to 95% of the cost of your house! Or if you want to bankroll this enterprise, you can average a return of 13% or more! Buy now!

Cultural Imperial posted:

https://twitter.com/MikePMoffatt/status/558607884574289920?s=09


Agree 100%.

cowofwar posted:

Election year

Cultural Imperial posted:

http://www.rew.ca/news/editorial-don-t-believe-the-hype-why-vancouver-isn-t-that-unaffordable-1.1741028

Lexicon posted:

I like how they enumerate several property transitions as the 'norm' (only because these assholes want their cut of commission each time).

sbaldrick posted:

Most people don't have the cash on hand to pay the 500 bucks if the furnace or hot water tanks goes bust (call cost plus parts). I pay 20 dollars a month and they just ripped out and replaced the hot water tank as part of the service contract or what it would cost for 10 years to buy it and given they generally only have a lifespan of about 10 years it's worth the money.

That's how you do a real emergency budget for something like this.

peter banana posted:

Shower stalls are pretty common downtown. Even in larger bathrooms because of money. It's pricey, and the immediate neighbourhood isn't amazing, but Little Italy and Roncesvalles are about a 15 minute walk and streetcars on College and Dundas.

Oh god, it's gotten so bad, I'm defending $1800 one bedrooms.

Baudin posted:

I love the "turning pristine wilderness into mordor" line

Have you fuckers ever driven around Fort Mac and seen your "pristine wilderness?" It's hardly some shining wilderness which is being converted to a smoke and tar filled landscape. Really wish I had taken some pictures of the landscape while I was up there.

e: I'm not saying that they're doing a swell job at environmental reclamation, but saying they're destroying pristine wilderness is a bit based on what I would term favourably as a bog.

triplexpac posted:

You mean they're not making any more oxygen??? HMmm maybe I should buy some now and get in on the ground floor before I'm priced out of the market.