November 8, 2021
To live is the rarest thing in the world. Most people exist, that is all.” ―Oscar Wilde
SPECTACULAR HIGHRISE IN SURREY! – REGISTER NOW!
SUPERB HIGHRISE IN VANCOUVER! – BUY NOW!
- BREXIT KILLS BRITAIN RETIREES – BUT OPPS FOR CANADIANS. CHINA MARKETS DRIVES MONEY OUT
- WORLD HOUSING CRISIS HOTSPOTS
- NOTE THIS: MMT WILL LEAD TO HIGHER AND HIGHER INFLATION!
- INFLATION OR DEFLATION
- ZILLOW SELLS HOUSES AT A LOSS. WHAT IF USA STOPS CANADIAN BUYING REAL ESTATE?
CANADA: OZZIE SAYS
- REDUX: LIVE JUROCK CASE INVESTMENT REALTY ZOOM MEETING, OCTOBER 21
- THE NUMBERS, THE NUMBERS – OCTOBER 2021, 2020, 2019, 2018
- COQUITLAM, WESTSIDE SURREY – HUGE SF HOME PRICE INCREASES
- 2% INTEREST INCREASES ARE NOT A BIG INCREASE IN PAYMENTS
- AFFORDABILITY DOES NOT DETERMINE UP PRICES
- PRE-SALES REMAIN HOT – WATCH PRESALE IN VANCOUVER AND SURREY
- TRANSPARENCY REPORT POSTPONED
- LOCK IN INTEREST RATES?
- NEED AN EASY MORTGAGE PAYMENT CALCULATOR
3 GREAT NEW OZBUZZ VIDEOS AND PODCASTS
- CHARAN SETHI and OZZIE discuss the fabulous new Highrise THE FLAMINGO in SURREY – THE 15 MINUTE CITY (Commercial, office and residential)
- KARIM VIRANI and OZZIE discuss the most exquisite new Highrise (floating condos in the sky) the FIFTEEN/FIFTEEN in DT Vancouver
- OZZIE SAYS: LIVE YOUR MONEY – sell your house and live 4 months in around the world places, plus make money on your cashflow real estate…
COMMENTS – YOU HAVE BEEN BUSY
23 replies to the UBS bubble report showing Frankfurt and Toronto in the top 3 in the world.
11 replies to the Evergrande piece and possible default of China on several fronts
97 replies to: Live Your Money (Ha-ha – that was fun!) Prompted me to put it on video: https://www.youtube.com/watch?v=VGsFRHfrues
38 comments on the numbers.
Too many others to answer. Join Ozzie on his Youtube.Com live stream and pre-send him your questions.
Our ‘international news’ features only events that may have an impact on our real estate investments. We make no political statement – just share our opinion on facts that may be relevant to us, as real estate investors.
MMT AND THE ARGUMENT THAT IT WILL NOT LEAD TO MORE INFLATION, HAH!
Lots of comments on my items on the Modern Monetary Theory. I have quoted Ray Dalio in my blog for over a year – how he looked at the dangers the world is facing and how the MMT is flawed…yet so loved by the left.
For the purposes of this blog, I direct you to this fantastic treatise of the MMT and in particular its treatment/view/conclusion on inflation (which is the only reason I talk about these things).
From the article (link below):
MMT proponents argue that central banks can print money without triggering dangerous levels of inflation. This claim not only overlooks the theoretical considerations outlined above, but it also ignores the dark history of debt monetization leading to hyperinflation. As Thomas Sargent famously documented in his 1982 classic, ‘The Ends of Four Big Inflations’, printing money and monetizing debt — even when that debt was partly denominated in local currency — led to devastating inflation in Austria, Hungary, Poland, and Weimar Germany during the first half of the 20th century.”
THIS IS A MUST READ:
Major Point: I have quoted Milton Friedman’s “Inflation is primarily a monetary phenomenon” a thousand times and my view (and predictions) about inflation being present (for 20 years) has never changed. This time everyone can see it …and still I have to hear: “…its temporary, transitory etc., etc.” Nonsense, we have not seen anything yet!
As usual lots of comments and opinion. Questions about Armstrong, Kiyosaki, Dent, Rickard dire forecasts. Inflation, deflation, stagflation…you want it, there is someone touting it.
I know why! They all sing from a different song sheet (demographics, core inflation, headline inflation, transitory, pandemic). Alas, you have to make your own decision. I have forecast massive inflation in real estate (and other) hard assets for 20 years (see above). Had you followed that, you would have been served well – against all the naysayer odds!
In the middle if the largest price increases WORLDWIDE – the naysayers still predict disaster. One day they will be right, but not now.
Think it through! Any SF house in Surrey made you $640,000 profit in two years! In a pandemic! Had you listened to the same people in 2019 (or 2010, or 2008, or 1998, or 1995, or 1990, or 1983.) More?
The only difference now is that it is visible everywhere. And yes, irrational exuberance can lead to a temporary downturn.
UBS BUBBLE INDEX
Same answer to the many responses to the ‘UBS bubble cities report.’ The world is printing money as never before…except now we see it SOONER, even daily!
THE BRITISH IN SPAIN (Unintended consequences for Brexit)
Watch living in Spain after Brexit. The new 90 / 180 rule (stay only 90 days in 180 days) means that Britains can only spend 90 days in 180 there. No more retiring in the sun. Also, no longer access to education, health service, the European visa is invalid and cheap flights? Gone!
Major Point: British people leaving the Costa Brava in droves…selling good homes at bargain prices…Maybe as a Canadian pick up a deal? This applies to all countries in Europe where British had decided to retire early…and now, no more!
TO THE CONSTANT INQUIRIES ON VALUES BASED ON AFFORDABILITY
Major Point: I said it before. My view is not that affordability is an issue on house prices in major cities. It is not! Vancouver has never been affordable. EVER! Wanna live in Hong Kong, London, Manhattan. You pay! We print the money out of thin air, we make it available at almost no interest and we pepper people with cash – the result has always been and will always be: Higher Hard Asset Prices. Period. Not affordability.
Evergrande met the CRUCIAL bond interest payment…however 11 new developers are in trouble and the next bond payment will likely sink Evergrande. The debt woes in China’s property market continues. Shares of Kaisa Group Holdings Ltd. and several units were suspended from trading in Hong Kong on Friday morning, a day after the developer said it missed payments on wealth products it guaranteed. Meanwhile, the personal balance sheet of China Evergrande Group’s founder has become a key variable for bond investors trying to figure out how long the developer can stave off default. Regardless… the whole Chinese local market has serious difficulties. The government crackdown on most major players, as well as educational and other online platforms will have the result: Money will want out! Where will it go…? Some of it will find its way here, even with our 2 years moratorium.
China is asking its people to stock up food, panic buying…luncheon meat , bottled water, rice, compressed biscuits. Ask yourself this tough question? Getting ready for war?
US: REAL ESTATE
I loved all the replies to “what if the US retaliated and stopped Canadian investors buying in Palm Springs?”
Of course, it’s easy to see the massive impact this would cause: According to Statista, Canada is the No.1 nation of foreign buyers, clocking in at 8%! Investment in the United States and property sales to foreign buyers totaled 78 billion U.S. dollars in 2019. In recent years, the largest share of foreign residential buyers originated from China and Canada, followed by Mexico. Foreign buyers of U.S. real estate prefer properties in suburban areas to properties in small towns and central areas of major cities.
Major Point: Now, imagine the US/Europe/Asia implement a 2-year “don’t buy here moratorium” for you!
ZILLOW SELLS REAL ESTATE AT A LOSS!
Not just a marketing service, Zillow’s iBuyers division bought $2.5 billion worth of homes nationwide ‘to flip’! In Phoenix alone they own around 10 percent of all listings. Companies like Zillow, Open Door, and Offerpad are just a few of the iBuyers who buy and often resell homes after making quick cosmetic changes. Now one of the biggest iBuyers, Zillow, is selling many of those homes for a loss. According to analysts, the median listing price of Zillow’s 250 homes is 6 percent below what they bought the properties for. Zillow announced it is holding off on buying new properties. (I guess, duh). In a statement, Zillow said it was because of a “backlog in renovations and operational capacity constraints.”
Major Point: In reality it is not the fact, that they are in the ‘flipping’ business, the market is still strong. The problem lies in its 3rd party evaluation system. They simply paid too much, based on faulty intelligence.
US example: XXX reports: I had a house for sale: “I thought $390,000 would be a bit optimistic but I wanted to see what it would be.” He had recently sold his home. He listed his xxx home for $390,000. The price was higher than real estate agents recommended. “A week after that I got the offer from Zillow for $412,000,” he said. “I thought what they know that I don’t know.” However, his former home is now listed on Zillow for $387,000.
So, its not the housing market in the US that’s the problem it is the lousy buying process from ibuyer funds. Fret not, they’ll flip it to a large hedge fund.
Q: Thanks for this “The 1031 exchange in danger?” Your readers should know it is NOT law yet!
A: Yes, as I said, but eyes wide open.
Q: On the ‘UNBELIEVABLE BUT TRUE’ item…lots of responses. Most too political.
A: I put it in as a warning. The MMT crowd (not just advertisers who buy your habits) wants to know everything you do – particularly financially. Why? So, they can tax it…maybe in the future they’ll give a section of the population free income and housing. If that’s the plan they need getting control of the population that will pay: YOU!
For banks to have to report every transaction over $600 would allow the Government to know what everyone does with their money, and who has it.
REDUX: JUROCK CASE INVESTMENT REALTY ZOOM MEETING OCTOBER 21
323 attendees subscribed, 64 did not attend full time. Lots of good comments! Thanks! We thrive on feedback. Many questions for a copy of the meeting. Sorry we don’t provide copies of our live events.
Ozzie did his “real estate romp around the world,” featured interest rates, Ralph did a great outline on long term versus short term investing
A special guest star was Charan Sethi who outlined his vision for Surrey/ Whalley district. Please see a separate video with Mr. Sethi’s newest building The Flamingo above.
You can register for a presale interest Jurock Case Investment Realty: Ralph Case managing broker of JCIR will be happy to keep you updated, if and when units are still available. Write here: firstname.lastname@example.org
LIVE YOUR MONEY
I got swamped about this… Yes, the email version had a writing error: 1 month Thailand not 2 etc. but I fixed when I put it online at ozbuzz.ca. The YouTube version was well watched and forwarded … a lot. Look at it here: LIVE YOUR MONEY: https://www.youtube.com/watch?v=VGsFRHfrues
Comments were: “It’s true I do not see myself as a multi millionaire.” “I sent this to my dad, wife, my uncle, my husband.”
“Anyone who lives within their means suffers from a lack of imagination.” ―Oscar Wilde
Q: Ozzie on Livestream was fun. But it’s gone. Are you still on and what eve?
A: Yes, must be a subscriber to YouTube.com/jurockvideo
Q: All I want to do is have a mortgage payment calculator. Every bank says they have one, so do a hundred google sites. None tell the truth. You have to go thru a myriad of questions and answers and still don’t get what you want. Drives me bonkers.
A: Bonkers, eh? I feel your pain. Here is an easy-to-use Canadian Government one
Q: What happened to blip.fm?
A: It’s on its last legs. Spotify and other biggies have squeezed it out. As a DJ for 11 years, I am sad to see it go. It still works and as a freebie music site it still can be fun. I still use it. Want to be my listener, become a DJ, I’ll follow you.
Q: INTEREST RATES, INTEREST RATES
Twenty-one questions on ‘whither interest rates. Lock in or not? Etc.! Also, statements like: “Looks like Benjamin Tal maybe right. Likely however, his forecast of interest raising next summer is going to be beat.”
A: Right, we already see short term rates heading higher and that 5-year term ? Up .7%. Michael Geller advised a relative of his to lock in for 5 years, using this chart as a guide. Locking in – with this history – at under 2% looks like a good bet indeed!
Generally, I stay with my Oz buzz 60/61 blogs: Everyone argues that governments cannot keep rates low without inflation. Agreed, seems reasonable. But that is why surprise will be on the upside. Also, I repeat my Oz buzz 43. Watch the 10-year treasury. If it hits 2%, hang on to your hats. BUT, BUT in any case, rising mortgage rates are not a big deal in the scope of things:
Q: Several “crash oriented subscribers” ask: What happens if interest rates go up suddenly by 2%? There will be a crash!
A: Just because rates go up, payments do NOT double: Example:
Borrow $100,000 at 1.5 percent, 25-year amortization – payment: $400. Now rates rise by 1% to 2.5%. Your payment also rises to $448.
At 3.5 % your payment rises to $500. So even if interest rates rise by 2 full percent, your payment goes from $400 to 500. (Not double to $800!) And if rates hit 3% higher your payment clocks in at $554.
So, keep your shirt on!
URGENT NOTE: The transparency report filing has been postponed to next year!
The outcry from the legal and accounting community was too loud and the government caved. Still check with your lawyer…but looks like its November 30, 2022, now!
Q: YOUR UBS HOUSING BUBBLE STUFF WAS AN EYE OPENER! YOU SAY WE ARE NOT ALONE! SO, NO CRISIS THEN?
A: Ha-ha…where in my blog do you come to that conclusion? NO one (yes including me, has the definitive answer). Housing markets around the world are in uncharted territory. In many cities, it has never been harder to find a home, with properties in short supply and rents at record levels. In this video (below) – an edition of Business Beyond – housing crisis hotspots are visited: Berlin (rent strike), Hong Kong, Shenzhen, Vancouver, New York, Dublin, and Tokyo. Are we too late to prevent a global housing disaster?
Subscriber Ace Victoria Realtor Rick Hoogendoorn directed our attention here:
Watch it and weep… https://www.youtube.com/watch?v=3UAdGuscwqk
Your thoughts – AS ALWAYS – are most welcome. WRITE QUESTIONS HERE: INFO@JUROCK.COM and put OzBuzz in the subject line. I try to answer ALL questions, but not all will be featured here.
CANADA REAL ESTATE
MUST READ NEWS – GOOGLE IT:
- UPDATE: A great surprise: Due to overwhelming requests from legal professionals, the deadline for pre-existing owners to file a Transparency Report has been extended to November 30th, 2022.
- UBC moves into Whalley! (Near city center)
- Lower Mainland land sales surge to nearly $600 million a month
- Metro Van votes to allow release of rural land for industrial use.
- West Van votes to explore/allow mini micro suites. Ace community builder Charan Sethi proved the micro suite concept in Surrey (and won an award for his building in 2017). People are price conscious and a well built 350 sq foot unit will sell.
THE NUMBERS, THE NUMBERS
Vancouver crazy October RE market:
Average Single Family House prices
Vancouver $2,066,500 up from $1,532,000 in 2019
Westside $3,737,800 up from $3,335,600 in 2019
Surrey $1,723,500 up from $1,083,000 in 2019
Coquitlam $1,654,400 up from $1,261,000 in 2019
Who made the most money in 2 years! Everybody!
The single-family home buyer in Surrey made $640,500!
Edmonton SF home up by 2% to 450,000
Calgary SF prices up 3% TO 571,000
(Imagine Vancouver’s SF home price 5 times Edmonton, 4 times Calgary. Ok, honey, we’re moving!)
But what about sales?
Victoria sales of SF down 30%.
Vancouver sales of SF down 18%
Surrey sales of SF homes down 26%
Coquitlam sales of SF homes down 23%
West side SF sales up 17% %
Edmonton SF up 1%
Calgary SF up 17%
Why do SF owners – flush ‘in the money’ do not rush to cash in? Listings are way down!
Well, they don’t know where to go and what price they may have to pay.
They feel, having made soo much money doing nothing – it may be the best move!
Or simply buyer fatigue? The argument is there: Condo prices and sales are rising sharply – price point?
Vancouver up 9%
Surrey up 16%
West side up 9% to almost 1 million
Calgary condo prices up 19% to $288,000 (Over 2020 but even with 2019)
(Calgary condo sales up 53% (from 234 – 360 !)
Toronto record price increases in SF, no listings, pressure on condos.
October 2021, 2020, 2019 and 2018
A detailed look at Vancouver, Westside, Coquitlam and Surrey
Sales of SF homes were down by -18%!
SF home prices still up by a whopping 20% (!!) Up by over $500,000 since 2015!
SF Listing and condominium active listings are both down by 26% and 30% respectively!
Sales of Condos were up by 15%, condominium prices up by 9%.
Condo Active listings down by 43% and new listings also down by 26%.
Vancouver Major Point: Normally when sales slump, listings increase. Not in this strange fall months in Vancouver. We pointed to a shift in the last few months from SF to condominiums. This continued in October. We saw over 1, 803 condominiums sold versus 1,102 SF homes.
Surrey (combined) MAJOR POINT:
October SF sales continue down sharply by 26% over 2020 but still up over 2019, 2018.
SF Prices are up an unbelievable 37%. At the same time Surrey SF Active listings are down by a whopping 47 % as well.
Condominium sales are up by 7%, the average condominium price is up a strong 16% and active listings crashed 60%lower!
That can only mean one thing… HIGHER PRICES AHEAD.
Surrey has had a spectacular September/October as compared to the last 4 years.
Pre-sales are selling like proverbial hot cakes. FOMO going on. Fear of missing out.
Ozzie’s other websites for you to play in: FREE
If you are in building, selling, marketing, developing, lawyering, etc. list yourself in the free BC real estate directory: www.bcred.ca (11704 visitors in September)
DISCLAIMERPlease note that any response to any email or any invitation to any meeting is accepted on the understanding that “Jurock Real Estate Insider (JREI)”, “OzBuzz (OB)”, “JCIR (JC)” as the case may be, are not responsible for any result or results of any action or actions taken in reliance upon any information contained in this posting or meeting, nor for any errors contained therein or presented thereat or omissions in relation thereto.
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The said OB and JREI and JCIR may or may not own properties discussed at meetings or receive or not receive referral fees at any meeting you may attend as a result of this posting or invitation. The said OB and JREI and JCIR, as the case may be, hereby disclaim all and any, liability to any person, whether a purchaser of any offering, a reader of any offering, or, otherwise, arising in respect of this postings and of the consequences of anything done or purported to be done by any such person in reliance, whether whole or partial, upon the whole or any part of the contents of these postings. If you respond to any posting OB or JREI and JCIR or attend any meeting from and by said companies, we fully expect that you get independent legal/tax/investment/mortgage advice as the case may be.
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OZZIE’S YOUTUBE CHANNEL
You can watch all videos and podcasts on my YouTube channel at https://www.youtube.com/jurockvideo. It is a great way to check on what I said 10 years ago.
Ozzie, Michael Campbell, Michael Levy and Victor Adair and guests are now on podcasts every week: https://omny.fm/shows/money-talks-with-michael-campbell
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Please note that any response to any email or any invitation to any meeting is accepted on the understanding that “Jurock Real Estate Insider (JREI)”, “OzBuzz (OB)”, “JCIR (JC)” as the case may be, are not responsible for any result or results of any action or actions taken in reliance upon any information contained in this posting or meeting, nor for any errors contained therein or presented thereat or omissions in relation thereto. It is further understood that the said OB or JREI, or JCIR as the case may be, do not, pursuant to this posting, purport to render legal, accounting, tax, financial, planning, or other professional advice. The said OB and JREI and JCIR may or may not own properties discussed at meetings or receive or not receive referral fees at any meeting you may attend as a result of this posting or invitation. The said OB and JREI and JCIR, as the case may be, hereby disclaim all and any, liability to any person, whether a purchaser of any offering, a reader of any offering, or, otherwise, arising in respect of this postings and of the consequences of anything done or purported to be done by any such person in reliance, whether whole or partial, upon the whole or any part of the contents of these postings. If you respond to any posting OB or JREI and JCIR or attend any meeting from and by said companies, we fully expect that you get independent legal/tax/investment/mortgage advice as the case may be.