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Cmhc Being Reigned In (Too Little, Way Too Late.)


ronthecivil

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We won't see a major fall in real estate in Vancouver.

At least not the kind some posters in this thread are talking about. You will not be able to buy some million dollar home at a 1/4 of the price in Vancouver ever.

Demand in Vancovuer is too high. If Condo dropped to 200k or houses to 500k, there would simply be too many people bidding to have anything available.

The fact of the matter is that prices already are slipping in Vancouver. I'd expect this trend to continue for a while, and you might see another 10-20% max. You will not a see a sudden 40%+ drop though.

As for Asian investments, that is done in cash.

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We won't see a major fall in real estate in Vancouver.

At least not the kind some posters in this thread are talking about. You will not be able to buy some million dollar home at a 1/4 of the price in Vancouver ever.

Demand in Vancovuer is too high. If Condo dropped to 200k or houses to 500k, there would simply be too many people bidding to have anything available.

The fact of the matter is that prices already are slipping in Vancouver. I'd expect this trend to continue for a while, and you might see another 10-20% max. You will not a see a sudden 40%+ drop though.

As for Asian investments, that is done in cash.

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Federal finance Minister Jim Flaherty said today he is satisfied with the measures his government has already taken to calm the housing market and has "no plans" to intervene any further.

Flaherty said the government watches the housing and condo market closely, and noted that in the last five years, he has taken steps, including changes to mortgage lending rules, to deal with a hot housing market. But, he said, "there are no plans presently to intervene further."

Flaherty was asked about the housing market and a range of other issues when he spoke to reporters Wednesday ahead of his annual summer policy retreat in Wakefield, Que., across the river from Ottawa.

Flaherty hosts an invited group of experts and representatives every summer to discuss what governments as well as the private sector can do in response to current economic challenges. The retreat feeds into preparations for the government's fall economic statement and the 2014 budget. This is his seventh summer meeting.

Hot condo markets called 'bumps'

The finance minister said the government does have contingency plans for the housing market if necessary.

"What has been done before can be done again — if we have to. But so far I'm satisfied that we have a balance in the real estate sector."

Flaherty described the condo markets in Vancouver and Toronto as "bumps" in that balance, but said "overall I'm satisfied that the measures we've taken over the past several years have adequately calmed the markets."

Canada is in a relatively good economic situation right now, Flaherty said, but the European and American economies remain concerning.

One of the questions Flaherty and his guests may discuss is the future of stimulus measures in the United States. Improving U.S. economic numbers have some wondering whether the U.S. Federal Reserve will soon back off its monthly monetary stimulus that has kept borrowing rates low, and that has some investors worried.

Balanced budget 'best protection'

Flaherty said he's "not a big fan of so-called fiscal easing or whatever it's called."

"We're moving toward a balanced budget, I think that's the best protection for Canadians," he said.

He said he anticipates the issue of quantitative easing will come up at the G20 meeting in September in Russia, and that it is contentious.

"As you know, we in Canada have not been fans of quantitative easing unlike the United States and elsewhere," said Flaherty.

"The danger in the longer term, to me as a finance minister, is inflation."

mi-flaherty-300.jpgFinance Minister Jim Flaherty speaks to Brian Lee Crowley, right, managing director of the Macdonald-Laurier Institute, and deputy minister Louise Levonian, left, at his yearly policy retreat at the Wakefield Mill Inn in Wakefield, Quebec on Wednesday, August 21, 2013. (Patrick Doyle/Canadian Press)

Flaherty said the financial assistance from the federal government to Alberta and Quebec to help with this summer's flooding and the Lac-Mégantic train derailment tragedy will not affect balancing the budget by 2015.

"We'll be OK. I've looked at the numbers," he responded. "There's enough room."

It's not known yet how much money the federal government will give to those provinces to help with rebuilding efforts.

The finance minister said the government is on track to balance the budget by 2015 and that when Prime Minister Stephen Harper launches a new agenda after a throne speech this fall it's unlikely there will be any big spending programs.

"If you're looking for anything startling from the department of finance I think you'll be disappointed," he told reporters.

Seventeen people were participating in Wednesday's meeting according to a list provided by Flaherty's department. He was asked about the cost of hosting the annual gathering and whether it is worth the money, given that he and his department hold pre-budget consultations across the country.

Flaherty said this is a time of year when he can get academics, businesspeople and others together in one room and that their advice will help him prepare for the next budget.

"I think it's incredibly invaluable to the Canadian people," he said about the retreat.

http://www.cbc.ca/news/politics/story/2013/08/21/pol-finance-flaherty-economists-summer-policy-retreat.html

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^^^^

Keeping in mind Flaherty has never balanced a budget in his life, is a lawyer not an economist let alone even a bookkeeper, left office in Ontario hiding a $5.4 billion debt, hasn't been able to stop the bleeding or hemhoraging of money federally, has cut every available program he can think of trying to save money and is the one that introduced the 40 year amortization period in Canada as well as tried to deregulate the banks to a US style system prior to the 2008 crash.

Yes...trust old windbag Flaherty

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So biggest question of all is this a good pr bad time to buy a house since apperently the prices of homes will drop but interest rates are going up? I have a 5 year fixes rate locked in till sep 15th at 2.79% but havent found anything yet

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So biggest question of all is this a good pr bad time to buy a house since apperently the prices of homes will drop but interest rates are going up? I have a 5 year fixes rate locked in till sep 15th at 2.79% but havent found anything yet

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So biggest question of all is this a good pr bad time to buy a house since apperently the prices of homes will drop but interest rates are going up? I have a 5 year fixes rate locked in till sep 15th at 2.79% but havent found anything yet

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A lot of factors there.

Firstly, how much are you spending? If you are buying a 1+ mil dollar detatched home, you are the most exposed there. They have the most room to fall. If you are buying a cheaper home on the east side, the increaed development in those areas may outweigh a lot of the decrease in the overall market.

If you are buying in the suburbs where there is more room to grow geographically speaking, you may be exposed there too.

The big issue with the last crash in Vancouver was that you had the combination of unused land, vacancy, and high interest rates. Vancouver no longer has vacancy or free land. If you compare all of those factors with regions worst hit in the USA, you'll see the same trend. Areas like Pheonix and Las Vegas, with lots of land and variable vacancy rates were devastated. Areas like NYC and downtown Seattle, with consistent high demand and limited land, were not hit all that badly at all.

Seattle homes are down from their peak in 2007 by about 15%. Vancouver home prices are down 10-15% from their peak already.

Part of the rise in Vancouver is warranted as the quality of home has improved. Condos these days are a lot nicer than the ones produced 10-20 years ago. Also, as more and more people move to Vancouver density and demand increase. We could see a continued dive in Vancouver, but the market will parrallel Seattle more than Phoenix.

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^^^^

Keeping in mind Flaherty has never balanced a budget in his life, is a lawyer not an economist let alone even a bookkeeper, left office in Ontario hiding a $5.4 billion debt, hasn't been able to stop the bleeding or hemhoraging of money federally, has cut every available program he can think of trying to save money and is the one that introduced the 40 year amortization period in Canada as well as tried to deregulate the banks to a US style system prior to the 2008 crash.

Yes...trust old windbag Flaherty

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All it will take is a major currency collapse somewhere, or something else goes badly wrong at Fukushima, or a natural disaster in the wrong place, and boom.

It won't matter what the state of the Canadian economy is at the time, the stimulous supported housing bubble goes down. This isn't the Golden Days anymore, we'd be deep in crash mode right now if it weren't for the unsustainable stimulous money and programs.

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Sure, but why worry when the bad loans are all backed up by the federal government? As it turns out, we won't have to bail out the banks. They are already pre bailed out. And when interest rates rise they will still have a ton of people signed up to be pushing the overwhelming majority of their money to them, most like for the rest of their lives. What's not to like about (owning) the banks?

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