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Originally Posted by Yume-sama
That article has absolutely nothing to do with Vancouver.
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I am afraid that I can not be so confident of that. I see a few connections:
- Speculative markets are greatly influenced by sentiment. And significant changes in a market geographcially close to Vancouver will have some affect on sentiment. Many people I know in Vancouver and other parts of BC do have connections to Kelowna (family, land, etc).
- Kelowna is a market for the same banks and insurance (CMHC) that operate in Vancouver and every other city in Canada. A significant increase in foreclosures in one market may cause these insitutions to tighten rules (which they have been starting to do even before this news came out).
- I have not seen any data to suggest that the foreclosures are 100% by Albertans. I suspect that there would be connections to homeowners in Vancouver. Even if they are vacation homes it does affect the owners net worth and their ability to finance or re-finance other assets they own.
- It is likely that a trend on one region may also be playing out in other regions. We just don't have the data yet (please feel free to repeat the refrain "...but it is different here....").
Quote:
Originally Posted by Yume-sama
Actually, the article itself makes a good point that Canadians are now buying dirt cheap vacation homes in the USA, and not anywhere else in Canada.
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That was the opinon of one real estate agent and was not backed up by any data.
Quote:
Originally Posted by Yume-sama
That said, 165 is a relatively tiny number...
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You are correct. In abosulute terms it is small. But it is a 1,000% increase over 3 years ago. Isn't that significant?
Quote:
Originally Posted by Yume-sama
...and tells you the strength of the Canadian economy in general ...
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Again I am afraid I can not be so confident about that strength. Our personal debt to income ratio is now HIGHER than it was in the US before their buble burst (
http://www.theeconomicanalyst.com/si...-canada-us.jpg). If you look at real estate fundamentals they are similar or worse than countries such as Ireland, Spain and Japan that experienced significant corrections.
Which is why more experts are discussing the bubble situation:
http://www.moneyweek.com/investments...e-bubble-20700