Orange_Lazarus posted:How easy is it for a person to get credit? Could a guy with negative net worth potentially get approved for a $300k+ home like in the US in 2007? Also how easy is it for someone mortgaging a home to bail on their debt obligation when they realize they can't afford it or lose their high paying job? This is what's important; people can talk about "not making any more land" or whatever all they want, but at the end of the day a large rise in housing needs to be accompanied by a rise in wages, since loans eventually have to be tied to income. You can only defy this financial gravity for so long, basically by making lending really loose, NINA, SISA loans, etc. Once the fly-by-night mortgage lenders were destroyed in the US (there was like one week in late 06 or early 07 where basically 75 percent of lenders disappeared overnight) it was the beginning of the end, and within 6 months the market was in complete freefall because without the supply of loans this game can simply not happen.
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Feb 16, 2013 06:35
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Cultural Imperial posted:From Ben Rabidoux's twitter: What the hell causes the massive drop every year from Dec -> Jan ? Fire sale at the end of the year for tax reasons? But the lowest start (2009) still recovered and basically performed as well as the boom years through the second half, so it's hard to say what a low start means. 312 fucked around with this message at 06:48 on Feb 16, 2013 |
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Feb 16, 2013 06:45
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Cultural Imperial posted:To prevent Canada's economy from going the way of the rest of the world(remember we were in the throes of the financial crisis) the bank of Canada reduced interest rates. Additionally, lending standards were loosened by Flaherty and thus people who could nominally, not afford to buy a house, suddenly could. Oh boy you guys are going to blow up. That staves off disaster for a couple years but makes it ohhh so much worse. But I was referring to the cyclical nature, it bounces from high to low every year in that graph, and it's not seasonal. Shifty Pony posted:Are there laws in Canada which prevent the use of Down-payment Assistance Programs? In the US they sprung up when banks started enforcing higher down payment requirements and nobody would take on 100% financing situations, and they became a hit with builders aiming for the first time homebuyer using an FHA loan which was the closest thing to 100% financing out there (allowing 97%). There were always plenty of other ways to do 100% through subprime. gently caress I saw 100% day out of bankruptcy financing even at the end on rate sheets. You're correct that brokers liked FHA loans (you got super paid) so if it was possible to go FHA (they actually were much stricter about income/jobs than subprime) those programs were utilized- you're not wrong at all about that. 312 fucked around with this message at 19:58 on Feb 16, 2013 |
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Feb 16, 2013 19:45
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Those are the only honest realtors I've ever heard of, ours said "check please". Though that may be an indication that realtors know lending is becoming tighter and they probably won't get the loan anymore. This is all un-shockingly familiar though, at this point the market is held up completely through little to no money down deals because no one has the cash anymore for 10-20% on insanely inflated prices. e: credit unions usually service the loans, so no surprise they want a high down payment. 312 fucked around with this message at 20:01 on Feb 16, 2013 |
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Feb 16, 2013 19:57
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Shifty Pony posted:Yeah but during the 2007-2009 time frame banks tightened up considerably on sub-prime (because practically nobody was buying any securities not backed by the GSEs). And the FHA rules allowing it was really hyped up as it being a government approved way to get homebuyers into homes. "Look, right there! Charities are specifically allowed for! If this were bad would the government be allowing you to do it? They would be on the hook after all... do you know better than the FHA?" My mistake, I was out of the game by early 2007 so I really didn't know they brought everything to FHA, that's pretty crazy. They also had the housing credit which was a complete disaster as well. Cultural Imperial posted:Story for the huge quote; I'm typing this from a nexus. What is a 100% day out of bankruptcy? What Bleu said. Even in late 06 you could still completely finance a house 100% even if you just left bankruptcy. Of course it would be an 80/20 loan with the 20% being a neg-am option arm from subprimemortgagewarehouse.com but hey. Excelsiortothemax posted:I'm just tired of hearing about house flipping. Many people are telling me to buy a crap shack, fix it up, then sell for profit! Heck, I just heard on the radio of a free seminar from a host of "Flip that House" that is trying to encourage more people to do that. Like I said in '06 (in reference to the old depression era quote) 'When I see housewives on HTV flipping shacks in Vegas for 100k profit, I know there's about to be a housing crisis' 312 fucked around with this message at 18:32 on Feb 18, 2013 |
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Feb 18, 2013 18:25
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Condos in chicago absolutely plummeted, almost basically halved in value. And "recovery" is a pretty relative term. It's still a lot lot worse than pre-crash for basically everyone that's not rich. Besides that Phoenix was absolutely not "suffering", the crash was huge there because the inflation was utterly loving enormous. As an example my cousins house went from 70k to 650 k in about 20 years. That's what matters, honestly it was the most prosperous areas where the crash hit the hardest, the exact opposite of it only affecting poor areas. See also Vegas, which was in a huge boom up until the crash. Places like Detriot didn't have very far to fall and it wasn't desirable to live there in the 2000's to begin with so really it's just lovely as it's always been. 312 fucked around with this message at 20:42 on Feb 18, 2013 |
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Feb 18, 2013 20:40
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Mr. Wynand posted:So what exactly has caused the initial rise in prices in Vancouver anyway then? Was it just availability of credit? If so, why Vancouver? Or at least, why Vancouver so loving hard? Are the same credit terms not also available in Toronto and Montreal and so forth? AFAIK, Vancouver housing prices have gone up a full order of magnitude higher then any of those places. The largest part is the cheap money. Why Vancouver in particular? Well I don't know Canada all that well, but in the US it heated up the most (and crashed the hardest) in places like Las Vegas, Phoenix, and so on.... cities that weren't really built up all that much prior to the boom, had lots of room for growth and were considered highly undervauled. Mostly places that could handle a lot of sprawl. If I had to guess it was probably harder to put more people into Toronto, but I could be way off. E: on the other hand, as someone already mentioned- maybe there is no exact reason, but Vancouver took off first, and it became a self-fulfilling prophecy that you could make the most money speculating there. 312 fucked around with this message at 01:36 on Feb 23, 2013 |
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Feb 23, 2013 01:33
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Possibly relevant:  e: im not really sure if I'm seeing a very concrete explaination for why say Miami exploded and dallas stayed level (it's not on this graph, but miami was actually the worse crash in the US) 312 fucked around with this message at 01:59 on Feb 23, 2013 |
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Feb 23, 2013 01:49
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But they didn't really have a crash so there wasn't anything to weather. I'm not sure if there's laws that prevented it from occurring in the first place or what though, it's a bit odd. Anyway what is really interesting to me is how we were told other countries (Australia in particular, but to a lesser extent canada) 'handled' the mortgage crisis, but it seems it just happened in the US first. Though, for the most part money fleeing into housing from dot com stocks was the reason for the US bubble in the first place, so I wouldn't be surprised that the money rebubbled elsewhere after it fled US housing. 312 fucked around with this message at 02:08 on Feb 23, 2013 |
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Feb 23, 2013 02:04
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