May 20, 2015

A Lot Of People Bought Houses When Prices Were High

The Vancouver Sun reports from Canada. “The hot real estate market is generating a frenzy of interest in property flipping in affluent West Vancouver as speculators turn big profits in only a few months. A review of 23 real estate listings by The Vancouver Sun reveals an average turnaround time of about 6½ months between purchase and relisting, with property asking prices inflated an average of 40 per cent, or $1.1 million per property, during that time. Kim Taylor, a realtor with Royal LePage, said that increased home flipping is linked to the fact there are more buyers than real estate available, adding that foreign buyers — especially from China and the Middle East — have contributed to the hot market in areas like the British Properties, Ambleside and Dundarave.”

“Some new owners are trying to flip their properties immediately for as much as $500,000, or almost 25-per-cent profit. ‘It’s a little out of control,’ Taylor said. ‘The prices even shock the sellers — what they can get. You see the diminishing sense of community there because a lot of people don’t live in the homes and they sit empty,’ she said. ‘It’s more of an investment.’”

The Vancity Buzz. “B.C. Housing Minister Rich Coleman has said neither his ministry or the province has any plans to collect data on foreign ownership, stating that housing costs in B.C. are ‘pretty reasonable.’ ‘If you look at the mean cost of housing across British Columbia and you compare it to other major cities worldwide, the reason it is attractive internationally is because it’s actually pretty reasonable compared to other cities like London, Singapore, Tokyo,’ Coleman answered.”

“After Coleman’s comments, it is clear the government is opposed to even researching the effects of foreign ownership on B.C. housing prices and its economy, let alone impose taxes. Meanwhile, the British Columbia Real Estate Association reported a 45.5 per cent increase from April 2014 in the total sales dollar volume for B.C. real estate and a 28.7 per cent increase in number of home sales, totaling $6.3 billion worth of real estate sold in April, making the month the hottest April for home sales in a decade.”

From MetroNews. “The number of Canadians who can’t pay their debts and are being forced into insolvency is on the rise for the first time since the recession, according to a report by CIBC. The bank says the cumulative number of insolvencies rose by 1.2 per cent in the six-month period ended in February. The overall increase came as personal bankruptcies fell by 4.7 per cent. However the number of proposals, where consumers negotiate to repay only a portion of their debt, rose by no less than nine per cent.”

“A prolonged period of low interest rates has helped boost household debt to record levels. However, data also suggests that while Canadian families are borrowing more, that increase has come against a backdrop of rising asset values, notably real estate worth. The CIBC report noted that delinquency rates continue to trend downward in all major types of borrowing, with the exception of lines of credit, where the delinquency rate has been on the rise in recent years. ‘This trajectory largely reflects transfer of risk from credit cards to lines of credit,’ Tal wrote.”

The Calgary Herald. “A prolonged oil price slump is beginning to adversely affect the Alberta housing market, where prices are currently 17 per cent overvalued, according to a Fitch Ratings report. Robin Wiebe, senior economist with the Conference Board of Canada, said Calgary homebuilders and sellers of existing homes are experiencing ‘collapsing demand.’ ‘In the resale market, although existing housing sales are on track to fall by a third this year, listings are currently on pace to decline by only five per cent,’ he said. ‘Potential home sellers have yet to react to the slowing market, although we expect that reaction to come. Price declines in Calgary are likely to accelerate through the balance of the year, if the past downturn is any guide.’”

From News Talk 770. “A new think-tank report is comparing Calgary’s housing sector to Wile E. Coyote’s pursuit of the roadrunner on Saturday morning cartoons. Robin Wiebe, senior economist with the Conference Board of Canada says like the coyote chasing the roadrunner, the sudden plunge in oil prices has left a housing industry chasing demand seeing it disappear. ‘Like Wile E. Coyote, the industry participants are hanging in thin air. Under construction volumes are relatively high. Listings, in the resale side, have started to come down, but they were relatively high. So the demand has evaporated and the supply remains.’”

“Based on recent oil price increases, Wiebe says the worst might be over. ‘I would suspect that the market has probably bottomed out now. We won’t see big future declines in prices and in starts. There will be some projects shelved. There will be some listings left unsold. At some point, the market will pick itself up, dust itself off and move forward as it always has. There are quite a number of projects that remain under construction. So, I would expect some job losses in construction, but not a dramatic downturn.’”

The Cold Lake Sun. “The local real estate market has slowed down due to uncertainty in the economy. According to Patti Ouellette of Remax Cold Lake, sales are down 45 per cent and prices have decreased by seven per cent. Rental housing prices have also dropped, and there is more supply than demand - a stark contrast to a year ago where renting a space was difficult. ‘The market is a little slow,’ Oullette said. ‘It’s flooded with houses.’”

“According to Oullette, a lot of people bought houses when prices were high, thinking the trend would continue, but then when prices dropped, people started losing their jobs. Jerry Soroschuk of Royal Lepage gave a similar assessment. ‘There’s a lot of product in the market that has been on sale for a long time,’ he said.”

“The uncertainty of oil prices has had an impact on the entire Northeast Alberta region. ‘It’s affecting all of us,’ Storoschuk said. He went on to say that bigger municipalities like Edmonton and Calgary aren’t immune to it either. ‘It will eventually trickle down,’ he said. Those effects are already being felt in Calgary. The situation is much worse in Fort McMurray and Lloydminster, where year-over-year prices have fallen by 48 per cent and 44 per cent respectively.”

The Financial Post. “Canadian snowbirds have been cashing out of their property in the United States in increasing numbers, according to new data from one of North America’s leading currency exchange groups. David Nicholls, head of partnerships for the North American division of Canadian Forex, said the dollar amounts coming back into Canada from the sale of U.S. homes are up almost 100 per cent in the past year compared to 12 months earlier.”

“‘The amount of money coming back from Canadians who have been selling property has pretty much doubled whereas as investment down into the U.S. (from Canadians) has stalled considerably and is almost down 50 per cent,’ Nicholls said, adding that reasons for the change are rising home prices south of the border and the sliding loonie.”

“The change in Canadian attitudes comes after what some had called a perfect storm for sunshine belt investment — with domestic housing values being used for financing U.S. purchases that were rock bottom because of the strong loonie and the housing crash in America. Nicholls said the peak of Canadian real-estate investment in the U.S. was in late 2012 and early 2013. ‘What we are seeing now is some of the early money that went in, is starting to come back after a really long run in the U.S. market,’ he said.”




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63 Comments »

Comment by Ben Jones
2015-05-20 04:18:37

‘in Fort McMurray and Lloydminster, where year-over-year prices have fallen by 48 per cent and 44 per cent respectively.’

I’ve been doing a search for Fort McMurray housing information every other day for months. Occasionally I go straight to the towns newspaper site, and I haven’t read of this price decline. Maybe they just forgot to tell anyone.

 
Comment by Mugsy
2015-05-20 04:58:14

“You see the diminishing sense of community there because a lot of people don’t live in the homes and they sit empty,’ she said. ‘It’s more of an investment.’”

Just like Mayfair, Chelsea, St. John’s Wood, etc, etc. London toxic shock syndrome comes to Vancouver.

Comment by Professor Bear
2015-05-20 06:35:02

‘It’s more of an investment.’

Does this go for homes that sit empty while prices are falling?

 
 
Comment by Mugsy
2015-05-20 05:01:15

“The local real estate market has slowed down due to uncertainty in the economy. According to Patti Ouellette of Remax Cold Lake, sales are down 45 per cent and prices have decreased by seven per cent. Rental housing prices have also dropped, and there is more supply than demand - a stark contrast to a year ago where renting a space was difficult. ‘The market is a little slow,’ Oullette said. ‘It’s flooded with houses.’”

It’s also flooded with a cold a$$ lake that’s near ice even in July. Who the hell is gonna’ pony up for that? I dove into that lake with a 6 pack in me and that didn’t even help with the shock.

Comment by Ben Jones
2015-05-20 05:12:44

http://www.royallepage.ca/en/property/alberta/cold-lake/na/3049034/mlse3411676/

$439,900

“The seller is offering a $5000 allowance to use towards a driveway!”

 
Comment by redmondjp
2015-05-20 09:38:30

There is some delicious irony in the business name ‘Remax Cold Lake’ IMO

 
 
Comment by Blue Skye
2015-05-20 05:10:09

“If you look at the mean cost of housing across British Columbia and you compare it to other major cities worldwide, the reason it is attractive internationally is because it’s actually pretty reasonable compared to other cities like London, Singapore, Tokyo,’ Coleman answered.”

This guy is a “Minister” and he isn’t smart enough to know that BC is a province, not a city?

Comment by snake charmer
2015-05-20 09:42:48

Oh, he knows all right. What weak and gutless leadership. He could admit that a problem exists, but instead he has to obfuscate like a realtor.

I read a comment here last week suggesting that some of these B.C. public officials were themselves speculating and flipping houses, which would make sense. That’s certainly what a lot of American public officials did.

Comment by Professor Bear
2015-05-20 21:56:43

“That’s certainly what a lot of American public officials did.”

This creates a conflict of interest in public service, which is why the practice should be banned.

But banning the practice would not be in the self-interest of the public servants who pass laws to make the value of their speculative real estate investments increase, would it?

 
 
 
Comment by Combotechie
2015-05-20 05:17:52

“B.C. Housing Minister Rich Coleman has said neither his ministry or the province has any plans to collect data on foreign ownership, stating that housing costs in B.C. are ‘pretty reasonable.’ ‘If you look at the mean cost of housing across British Columbia and you compare it to other major cities worldwide, the reason it is attractive internationally is because it’s actually pretty reasonable compared to other cities like London, Singapore, Tokyo,’ Coleman answered.”

Rich Coleman, huh? So who is this Rich Coleman guy?

Wiki says:

“Before his election to the Legislative Assembly, Coleman ran a real estate management and consulting company.”

Hmmmmm. Back to the article:

“After Coleman’s comments, it is clear the government is opposed to even researching the effects of foreign ownership on B.C. housing prices and its economy, let alone impose taxes.”

What a surprise!

“Meanwhile, the British Columbia Real Estate Association reported a 45.5 per cent increase from April 2014 in the total sales dollar volume for B.C. real estate and a 28.7 per cent increase in number of home sales, totaling $6.3 billion worth of real estate sold in April, making the month the hottest April for home sales in a decade.”

Commissions, commissions, commissions! Commissions for everybody!

Comment by In Colorado
2015-05-20 06:26:06

B.C. Housing Minister Rich Coleman has said neither his ministry or the province has any plans to collect data on foreign ownership, stating that housing costs in B.C. are ‘pretty reasonable

Maybe they’re “reasonable” if you’re a Chinese oligarch. If you’re a working stiff, you’ve been priced out … big time. Note that I didn’t say “priced out forever” because Mr. Coleman and his minions will fail to keep prices in the stratosphere forever, though it might be a while before they come back down to more reasonable levels.

 
Comment by In Colorado
2015-05-20 06:27:24

Do Canadian realtors charge 5-6% commission like American realtors?

Comment by pricedoutfornow
2015-05-20 21:02:34

Someone selling a house told me recently that his commission is 7% on the first $100,000 and 3.5% on the next $$$. So yeah, pretty much.

 
 
 
Comment by Ben Jones
2015-05-20 05:22:10

‘an average turnaround time of about 6½ months between purchase and relisting, with property asking prices inflated an average of 40 per cent, or $1.1 million per property, during that time’

Like running around with scissors.

 
Comment by Blue Skye
2015-05-20 05:24:25

“Canadians who can’t pay their debts and are being forced into insolvency…rose by no less than nine per cent.”

“A prolonged period of low interest rates has helped…”

Isn’t it ironic that cheap credit leads to insolvency.

Comment by Combotechie
2015-05-20 05:32:19

“Isn’t it ironic that cheap credit leads to insolvency.”

That it is.

Cheap credit = They can.

Expensive credit = They can’t. And if they can’t then they won’t.

Comment by Ben Jones
2015-05-20 05:45:50

‘with the exception of lines of credit, where the delinquency rate has been on the rise in recent years’

LOC backed by houses?

‘a perfect storm for sunshine belt investment — with domestic housing values being used for financing U.S. purchases’

‘dollar amounts coming back into Canada from the sale of U.S. homes are up almost 100 per cent in the past year compared to 12 months earlier’

Comment by redmondjp
2015-05-20 09:40:53

Those smart Canuckians . . . cashing out of the US market while they can!

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Comment by Professor Bear
2015-05-20 05:40:52

‘Like Wile E. Coyote, the industry participants are hanging in thin air. Under construction volumes are relatively high. Listings, in the resale side, have started to come down, but they were relatively high. So the demand has evaporated and the supply remains.’

Must’ve mined the HBB archives for that gem of a metaphor…

 
Comment by Ben Jones
2015-05-20 05:49:45

‘Canadian Prime Minister Stephen Harper warned on Thursday that some consumers are overexposed to mortgage debt even if the housing market remains stable, a rare nod by the government to high consumer debt levels in an uneven housing market.’

‘Reiterating his stance that Canada’s housing market should be strong and stable “over the longer term”, Harper said his Conservative government would not consider a tax on foreign purchases of real estate.’

‘While Australia already restricts foreign real estate investment, Canada does not even track it. Some analysts believe a tax on foreign buyers would cool hot markets in Toronto and especially Vancouver, where a backlash against wealthy Chinese homebuyers is building.’

“Now, all of our data indicate that – both for lenders and for borrowers at low interest rates – this debt is very manageable. But there are some people who are overexposed, so we encourage people to exercise caution in terms of their borrowing,” Harper told reporters.’

‘While the household debt-to-income ratio is at a record high 163.3 per cent, Canada’s big banks continue to roll out new mortgage products with low introductory rates, an innovation that reminds some of the U.S. subprime lending model that left many borrowers unable to cope when interest rates eventually rose.’

‘Canadian Imperial Bank of Commerce was offering on Thursday to “lower your mortgage rate for nine months” by charging an introductory rate of 1.99 per cent on a four-year fixed-rate mortgage. Even without the offer, mortgage rates are near historic lows in Canada, often below 3 per cent.’

Comment by Professor Bear
2015-05-20 05:55:15

“…some consumers are overexposed to mortgage debt …”

’some’ is a code word for ‘we’re completely hosed’…

 
 
Comment by Professor Bear
2015-05-20 05:51:45

“Canadian snowbirds have been cashing out of their property in the United States in increasing numbers, according to new data from one of North America’s leading currency exchange groups. David Nicholls, head of partnerships for the North American division of Canadian Forex, said the dollar amounts coming back into Canada from the sale of U.S. homes are up almost 100 per cent in the past year compared to 12 months earlier.”

If the Chinese seabirds stsrt cashing out as well, things could get very interesting real fast.

Comment by redmondjp
2015-05-20 09:46:01

It’s possible, but where would they park those dollars? Where is the safe haven? Back in China??? Buy PMs (but where to keep them)?

At least in my area, I don’t see the foreign buyers making a run for the exits, even if the market corrects. For them, half of something is better than all of nothing. It’s about asset preservation, and they view land in the Land of the Free as a good asset that is never going to go to zero value.

Comment by Housing Analyst
2015-05-20 09:50:25

Paying inflated prices for depreciating assets isn’t asset preservation.

Comment by Professor Bear
2015-05-20 21:57:43

It’s pouring good money down a rat hole.

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Comment by Karen
2015-05-20 15:07:49

What dollars? Even though many Chinese paid “cash”, isn’t it often OPM? And won’t those loans, whether inside the traditional banking sector or outside it in the shadow banking sector, come due?

 
Comment by Dudgeon Bludgeon
2015-05-20 16:32:14

A most popular saying in China basically translates to “Easy come, Easy go”.

Seriously.

 
 
 
Comment by Ben Jones
2015-05-20 05:54:46

‘Real estate magnate Bob Rennie says young Vancouverites should let go of their dream of owning a single-family detached home in the city and embrace density if they want to stay.’

‘With the average price for a single family home in Vancouver hitting $1.72 million in 2014, only densification will solve Vancouver’s housing affordability dilemma, says Rennie.’

“I think the problem we have with single family homes in Vancouver is we’re not making anymore of them. We’ll never create another single family lot in my lifetime. There’s depleting inventory and increasing demand,” Rennie told The Early Edition’s Rick Cluff. “So it’s toxic.”

‘According to Rennie, whose company was involved in high-profile projects like Vancouver’s Olympic Village and the redevelopment of the historic Woodward’s building, planners need to create a lot of density at once in order to drive down prices.’

“I know nobody wants to hear that, but unless we’re going to take a big broad brush stroke and add a lot of density, we’re in trouble,” he said.’

Drive down prices? And wasn’t the Olympic Village a boondoggle?

Comment by Ben Jones
2015-05-20 05:58:49

Millennials shouldn’t lower expectations
Affordable housing rally May 24

http://www.vancourier.com/opinion/millennials-shouldn-t-lower-expectations-1.1940413#sthash.AngBPE3k.dpuf

Comment by AmazingRuss
2015-05-20 09:11:26

Their future was sold before they were born, and they need to get used to their chains.

 
 
Comment by Blue Skye
2015-05-20 06:27:07

“We’ll never create another single family lot in my lifetime. … “So it’s toxic.”

Yet you have plenty of land to build your cheap high density towers, right?

Comment by scdave
2015-05-20 06:59:19

Yet you have plenty of land to build your cheap high density towers, right ??

Thats the effect of re-zoning for higher and better use….It frees up land for redevelopment…IE…Old Motel thats zoned Commercial Thoroughfare (CT)…Rezone to allow Planned Development (PD) with 1st floor retail and 60 units+ per acre above…Pretty common right now…

Comment by Young Deezy
2015-05-20 08:00:55

Well, slap on the tinfoil and remember that Agenda 21 rules (often imposed under different names depending on the locale) basically outlaw building traditional single family tract homes. It’s all high density, urban, “diverse” neighborhoods from here on out.

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Comment by redmondjp
2015-05-20 10:00:20

+1000! At least somebody else besides me is paying attention.

Here in the Seattle area, our regional Agenda 21 imlementing agency is the Puget Sound Regional Council, and their Agenda 21 plan is called “VISION 2040.”

You can read all about it here:

http://www.psrc.org/growth/vision2040

The Cliff’s Notes version of the story is this: we are all going to be stuffed into high-density housing situated along transit corridors (wth single-family homes reserve for the 1%).

My local city is in complete lockstep with this plan:

1) Use emminent domain to force multi-generational family businesses to move out of downtown.

2) Put in new park (that they don’t have the funds to complete) that nobody is asking for.

3) Build fugly multi-story apartment/condo buildings (with obligatory ground-floor Starbucks/Jamba Juices) right up to the steets.

4) Take out existing heavy rail corridor (which would have worked perfectly for commuter rail) and turn it into interpretive artwalk trail/bike path.

5) Have regional light-rail come into downtown in some future decade (also not paid for, we need billions $ more for that).

And the long-time locals HATE it.

 
Comment by Dudgeon Bludgeon
2015-05-20 16:36:13

“And the long-time locals HATE it.”

It’s called Vision2040 for a reason. The long time locals will all be dead by 2040 and in homes for the aged long before then.

Remember always…You are not the customer…

 
Comment by Professor Bear
2015-05-20 21:58:45

Urban planners = communists…

 
 
 
 
 
Comment by taxpers
2015-05-20 05:56:00

Illanoy will raise ‘re taxes even more since gov pensions get protected

Comment by rj chicago
2015-05-20 07:51:46

+1 - Those of us who live in this flea bitten cess pool of state are gonna get hosed and real soon. Taxes are gonna go up ….. this will accelerate an already steady stream of folks who can and will - exit the state -
Rauner a couple of weeks ago basically told Rummy and crew in Sh*tcago to f off and look where that got rummy a week ago…..debt now rated as junk. Rummy turns right around as Moody’s had jumped the shark on him and what does he do - he blames Moody’s - not his and his predecessors lousy policy and open bank book for the problems.
Stick a fork in it - this place is done.

 
 
Comment by Ben Jones
2015-05-20 06:03:20

It begins:

‘On Wednesday morning, one of Adam O’Keefe’s moving crews is scheduled to pull up to a six-bedroom home in Springbank, a well-to-do neighbourhood just west of Calgary, clear the contents out of the house and send it directly to a consignment gallery.’

‘O’Keefe doesn’t know the specifics of the homeowner’s situation, but as the oilpatch reels from a prolonged downturn in prices, the president of locally based Alberta Pro Movers has seen an unfortunate increase in court-ordered repossessions.’

“We’ve received a lot of calls saying ‘I need to be out of here right now; a lawyer will be present or a police [officer] will be present,’” he said in an interview Tuesday.’

‘Cumulative insolvencies in Manitoba and Saskatchewan rose by almost 11 per cent in the six-month period, while Alberta saw an 6.5 per cent increase, the province’s “worst showing since the recession,” CIBC said.’

‘The report notes “there are reasons to believe that the coming quarters will see continued deterioration” in the number of bankruptcies in Canada’s largest oil-and-gas producing province. For example, the number of bankruptcy proposals in Alberta is up 24 per cent in the six months ending in February. The province is also home to the highest share of bankruptcy proposals in Canada.’

‘Jobs losses, like the growing number of foreclosures, are keeping O’Keefe’s moving company busy. “I’ve seen a dramatic increase over the last couple weeks of leads coming in, people looking to go to Newfoundland, Nova Scotia, Ontario and it does seem, from the customers I’ve spoken with, that it is the oil industry,” he said.’

Comment by Ben Jones
2015-05-20 07:16:14

’send it directly to a consignment gallery’

Huh, must need the money.

In all the foreclosures I’ve been involved in, none of the FB’s could afford a moving company. They’ll be pouring concrete down the toilets before it’s over.

 
 
Comment by Ben Jones
2015-05-20 06:20:23

I got this email:

SHANGHAI, CHINA/IRVINE, Calif. – May 20, 2015 — Juwai.com, the No. 1 Chinese international property portal, and Auction.com, the leading online real estate marketplace, have signed a partnership that will bring American commercial real estate auctions to investors from China.

The agreement will see US real estate listings from Auction.com advertised on Juwai.com in Chinese, where they will be immediately accessible to Juwai.com’s 2.6 million monthly Chinese-speaking users – in mainland China and around the world.

Initially, the partnership will focus on commercial properties - multi-family units, hotels, retail and office buildings - listed for sale on Auction.com. But given the high level of interest in US residential properties from Chinese buyers, residential homes will likely be added to the mix as well.

“Over $48 billion in foreign capital was invested in US commercial real estate in 2014, and China was second only to Canada in the amount of CRE investment,” said Auction.com CEO and Co-Founder Jeffrey Frieden. “Our strategy has always been to leverage the global reach of the Internet to deliver the largest number of prospective buyers for our sellers. So we’re excited to partner with Juwai.com, which has the largest audience of Chinese international property buyers, and will help us effectively target Chinese-speaking investors in mainland China, Hong Kong, Singapore and even in the US.”

Simon Henry, co-CEO of Juwai.com, said: “Chinese buyers don’t want to be disadvantaged because of their language or physical distance from the US. We help educate cross-border buyers by providing access and information on global real estate buying practices.”

Comment by scdave
2015-05-20 07:09:56

I got this email: ??

I have not spent a lot of time on that Portal but from what I have seen its listed property that is, for whatever reason somewhat difficult to sell OR listed for the purpose of trying to get a bidding war going on it without stipulating that there is a reserve price…

Loopnet (Co-Star) is the major Portal for commercial investment real estate…For $700. a year you get Thousands of listings throughout the Country…Every commercial brokerage company list through this Portal besides their local boards…

 
Comment by snake charmer
2015-05-20 09:56:35

Yeah, let’s let hordes of uneducated Chinese speculators borrow money to bid up houses in our neighborhoods which they don’t intend to live in. What a great idea.

Looking at China, I am compelled to ask this question: has there ever been a bigger pool of dumb money in world history?

Comment by AmazingRuss
2015-05-20 15:22:41

“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered.”

-Thomas Jefferson

 
 
 
Comment by taxpayers
2015-05-20 06:34:15

is there a silver miner w decent fundamentals or should I just do this?
VGPMX vanguard precious

Comment by Professor Bear
2015-05-20 06:38:48

Why would you want to buy PMs near a cyclical peak? (Of course, if the Fed never gets around to raising rates, you might look like an investing genius through the lens of the rear view mirror…)

 
Comment by snake charmer
2015-05-20 10:05:37

I’ve had money in VGPMX for awhile. Let’s just say it’s been a very long valley. The thing about that fund is that its investments can include industrial commodities like coal and iron ore, so I would look carefully at its portfolio at any given time.

Comment by Professor Bear
2015-05-20 22:03:55

“…coal and iron ore…”

Sounds like a looser, thanks to collapsing commodities demand from China.

China Smog War Seen Dooming Coal on ‘Cheap But Dirty’ Purge
2:00 PM PST
May 18, 2015

China’s battle against pollution is threatening the recovery of coal prices from the lowest level in almost nine years.

Installations of new coal-fired power capacity in the world’s biggest polluter are set to halve as “cheap but dirty” plants get eliminated, according to Bloomberg New Energy Finance. Prices of China’s benchmark power-station coal have tumbled 59 percent from a peak in July 2008, and none of five analysts surveyed by Bloomberg predict a recovery.

Price of iron ore on the move downwards

20 May, 2015
Vicky Validakis

As debate erupts over whether or not Australia’s iron ore industry is in need of a government inquiry, the price of the commodity is quietly falling again.

After rising to above $US60 per tonne last week, iron ore is now trading at a two-week low of $US58.40 per tonne.

It follows a tumultuous year for the commodity which has seen it fall and rise amid volatility in the market.

Iron ore entered 2015 valued at $US71.26 per tonne after a horror 2014 which saw it lose 47 per cent of its value.

 
 
 
Comment by Housing Analyst
2015-05-20 08:40:08

“The Upside To Houston’s Falling Housing Prices”

http://www.bizjournals.com/houston/morning_call/2015/05/the-upside-to-houston-s-falling-home-prices.html

Remember…. There is always an upside to falling housing prices whether in Seattle, Houston, New York, Los Angeles, Washington DC.

 
Comment by Housing Analyst
2015-05-20 08:44:51

“Oil Prices Fall on Steady Production”

http://www.wsj.com/articles/oil-prices-lower-on-global-oversupply-concerns-1431595252

Nothing helps my economy like dramatically lower and more affordable prices of everything including gasoline.

Comment by taxpers
2015-05-20 09:05:31

See howmoneywalks.com and co illanoy

 
 
Comment by baabaabooie38
2015-05-20 09:27:57

How can housing prices rise anymore in this environment? Isn’t anyone buying today, purchasing an inflated housing price spurred by ultra low interest rates? They are setting themselves up for another major underwater episode like 2008?

I mean interest rates are not going to go any lower. Why are people this dumb? its just basic math.

Comment by redmondjp
2015-05-20 10:40:03

People get caught up in manias, and we don’t learn anything from history (even recent history less than 10 years ago).

It’s human pride and ego, which trumps basic math.

 
 
Comment by Housing Analyst
2015-05-20 10:55:07

Los Gatos, CA List Prices Crater 10% YoY

http://www.movoto.com/los-gatos-ca/market-trends/

 
Comment by traderjack
2015-05-20 13:35:44

I just do not know how to figure out the politicians involved in this stuff. Did they ever take economics 1?

they seem to think if they increase the demand for homes by lowering interest, that the house prices will come down because more house will be built for the buyer public. And that would mean more taxes for the government.

And then, when the price go up, they think that if they increase the minimum wages to $15 per hour, more people will be able to buy homes which will increase demand, more homes would be built for the buyers.

And the economy would boom, jobs would increase, and more people could buy homes, and more homes would be built for the new buyers.

they never consider the effect on home prices caused by increased demands.

Which drives more people out of the market, which makes the government consider more ways to give benefits to the public which will allow them to buy more bigger , better, and more expensive homes which would increase the tax income to the government.

and then they find out that there are lots of people who lost their home, are homeless, so they start to build homeless shelters, which requires them to provide money to maintain them and feed the homeless, which requires them to raise the taxes, or fees, and that drives the prices up, which requires less interest,more minimum wages, etc.

Disagree if you wish!

Comment by Housing Analyst
2015-05-20 15:05:17

Housing demand is at 20 year lows for once simple reason; Housing is grossly overpriced.

 
 
Comment by Ben Jones
2015-05-20 15:02:49

‘Vancouver steals the spotlight when it comes to international investment, but a stream of money is quietly flowing upstream from the city.’

‘Two years ago, CBRE Ltd. announced that Aldesta Hotel Group had acquired Harrison Hot Springs Resort and Spa for $32.3 million. Backed by mainland Chinese capital, the Vancouver-based hotelier added the property to a portfolio that also includes Poet’s Cove Resort and Spa on South Pender Island.’

‘Chilliwack-based homebuilder Odessa Group is now finding foreign money keen to acquire a slice of its Harrison Highlands project, which quietly launched last November and is now in full marketing flare. Approximately a quarter of the 49 units in the first phase of the 90-acre subdivision have sold, with buyers ranging from commercial fishers to Kuwaiti professionals.’

“This is going to be their Canadian vacation property. They bought one of our biggest houses,” Nathan Stone, principal of Odessa Group, said of the Kuwait buyers.’

‘A couple nearing retirement age whose children have established careers, the Kuwaiti buyers are typical of those eyeing the project, which is tipped as ideal for “active retirees.”

‘Stone said the majority of buyers – 80% to 90% – are age 45 and up. “They’re all either preparing to retire or are semi-retired or are fully retired,” he said.’

https://www.biv.com/article/2015/5/california-rental-housing-market-lures-local-devel/

Comment by Dudgeon Bludgeon
2015-05-20 16:47:45

“This is going to be their Canadian vacation property. They bought one of our biggest houses,” Nathan Stone, principal of Odessa Group, said of the Kuwait buyers.’

Oh for FS. Canada is not a vacation destination for Kuwaitis. Can you imagine a less Kuwait like environment for these folks? Chilliwack? What, they’re going to go fishing?

It’s a GD investment. Just like all the rest “upstream”. Such profound BS.

Why, there outta be a law!

Comment by Patrick
2015-05-20 19:01:22

Dugeon

BC - vacation capital.

Deer on the golf course, bears in your backyard, also crossing the road. So many salmon jumping you don’t need a bridge. Mountains with roads made of chopped volcanic glass. Lazy union people. Tree huggers who flew thousands of miles to be there. Ability to get lost within 100 feet of a road. People who would rather walk or ride a bike than drive a car to work.

Scenery so beautiful you might forget to take a picture. Salmon so good you WILL gain weight. Reasonable cost of living. Solitude - yes. Alpine water so good you will take some home. Fit people who ride a bike up mountains - tall mountains.

Did I say friendly people in Van-houver? Stand on Robson Street and count the Canadians - if there are any.

 
 
 
Comment by Colorado Renter
2015-05-20 16:36:23

Here’s a good one I saw today, down the street from me:

http://www.trulia.com/property/3089541527-3746-Grove-St-Denver-CO-80211

$400,000 for less than 1,000 SF, in a run down, old house that is being flipped. And some idiot will probably pay over asking, as well as giving the seller flowers/cards for the privilege!

Comment by Ben Jones
2015-05-20 16:38:43

02/16/2012 Sold $200,000

977 sqft
$409/sqft
Lot size: 3,152 sqft
Built in 1907

It doesn’t have hallways.

Comment by Colorado Renter
2015-05-20 16:46:14

Isn’t that crazy? Blatantly flipped. The $200k in 2012 was overpriced too… I bet that thing was worth about $80k a few years before that.

 
 
Comment by Housing Analyst
2015-05-20 16:38:54

Denver, CO List Prices Crater 9% As Oil Bust Looms

http://www.movoto.com/denver-co/market-trends/

 
 
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