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Baby, we got a bubble!?

EXgeMMy said:
with the world markets where they are at, I don't think Carney will be raising interest rates. Of course that will only encourage Canadians to take on more debt.
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I am quite sure barring a further meltdown he will in fact raise the rates. Perhaps not in June but July. Perhaps not as much as anticipated. I would think that people would be reading the papers and becoming more hesitant to take on the debt. At least lets hope that those who couldn't afford it or are borderline will think twice before leaping, therefore not taking on debt they can't service.
 
Might as well buy a large freezer and store stockpiles of chocolate -- there will always be high demand for chocolate from the female population -- as sure as death and taxes and a solid way to avoid the looming 30% RE crash!
DD
 
interested said:
I am quite sure barring a further meltdown he will in fact raise the rates. Perhaps not in June but July. Perhaps not as much as anticipated. I would think that people would be reading the papers and becoming more hesitant to take on the debt. At least lets hope that those who couldn't afford it or are borderline will think twice before leaping, therefore not taking on debt they can't service.
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I am willing to bet 60/40 that he's going to raise it 0.25 on Tuesday, which is the anticipated amount.
 
Kenny said:
I am willing to bet 60/40 that he's going to raise it 0.25 on Tuesday, which is the anticipated amount.
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this is from the Globe and Mail today online: "Next Tuesday's BoC announcement is a close call,” Bank of Nova Scotia economists said. “We still think they'll hike 25 basis points, but the odds have moved to about 65 per cent in our view, or slightly higher than the coin-toss priced into the market.”

You are going to have to raise your bet or give odds now as the market is betting 65% that Carney will raise.

T
 
^ What are you basing that on? The market isn't expecting anything like that, and you and I both know how much markets hate surprises. It would seem completely idiotic to surprise everyone which such a large hike.

Why would they rates the rates by so much? Inflation is rising, but not by much, and this is the main concern of central banks.
 
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If they have to resort to marketing it in Abu Dhabi, I take that as a negative.

That said, my prediction is a correction of 5-15%.
 
Eug said:
If they have to resort to marketing it in Abu Dhabi, I take that as a negative.

That said, my prediction is a correction of 5-15%.
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Agreed, it is a negative: but for the local market only. It is still an attractive buy for overseas investors. Prices are cheap by European/Hong Kong standards. 5-15% correction, yes but during 1-2 years and then only for low end units -- 1 or 1+1. Yesterday's report by Remaxcondosplus.com states that market for units over $ 500,000 is still active. Eventually, prices will start going up again. It is just a matte of supply and demand.
 
I would not bet on the over $500K remaining active.

One requires the lower market to sell so that people can trade up. right now, with the new rules of greater downpayments, investors are being sidelined or are less active. Investors tend to buy smaller less expensive units. Easier to rent. They may buy small 2 bedrooms if they can get it at a reasonable price.

As far as end users,with less demand for smaller units, people will not move up, therefore slightly larger units while in demand will not be able to command the price since the trade up buyer relies on price from his smaller unit to qualify to buy the next step up.

Related to Urbandreamer's comment of 0.75%. I am guessing he was just trying to elicit a response from all on the platform. I don't believe he really believes 0.75% (but remember he is a "dreamer") or he is commenting on a longer time frame than the next 1 to 2 rate hike periods in June and July.
 
interested said:
Related to Urbandreamer's comment of 0.75%. I am guessing he was just trying to elicit a response from all on the platform. I don't believe he really believes 0.75% (but remember he is a "dreamer") or he is commenting on a longer time frame than the next 1 to 2 rate hike periods in June and July.
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You have to be a dreamer in this world. As they say, where there is a dream (actually, hope), there is life. Unfortunately, this particular dreamer always looks at life through dark glasses.
 
urbandreamer said:
No. If stock market double bottoms like it should to be healthy, the big boys will not be buying luxury product for a few years either. Both high and low end product will be affected by the crash.
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The stock market may well bottom again or at least correct. That will affect more the higher end product(housing). Lower end product is bought I suspect by individuals who do not have alot in the stock market and most of their wealth is tied up in their principal residence and making ends meet with little left over for the luxury to play the market. that said, a negative world outlook affects every thing from cars, to clothing to housing etc.
 
KA1 said:
You have to be a dreamer in this world. As they say, where there is a dream (actually, hope), there is life. Unfortunately, this particular dreamer always looks at life through dark glasses.
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Ka, I agree that urbandreamer especially of late has been looking at life through dark glasses but that said, there is alot to be concerned about in world events now so that one should not frown upon him for simply seeing things as "dark". things are definately not rosy but that said I do believe that Urbandreamer sees them worse than they are. At least I HOPE so. Maybe that makes me a dreamer too.
 
The BOC will hike 25bps each and every meeting until their target rate hits 2% (7 meetings), at which time they'll pause.

Not sure about you, but I've never heard of a 2% target rate (0% "real" rate) pushing RE down 30%. Hey, I'd love to purchase property 30% cheaper. Problem is, I doubt we'll even see a 5% pull back. Anything more is simply wishful thinking IMO...
 
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