Mortgage & Finance Experts Say - No Housing Bubble?

(June 29, 2016 )

THE BC HOME HUNTER GROUP  Metro Vancouver I Fraser Valley I BC Urban & Suburban Real Estate Experts   You've noticed we're different. We specialize in you. Like us on Facebook and follow us on Twitter, Instagram, YouTube, Pinterest, Tumblr and Google+ 604-767-6736.  #Calgary #Toronto #Edmonton #Vancouver l #WhiteRock l #SouthSurrey l #WestVancouver l #Yaletown l #MapleRidge l #NorthVancouver l #Langley l #FraserValley l #Burnaby l #FortLangley l #PittMeadows l #Delta l #Richmond l #CoalHarbour l #Surrey l #Abbotsford l #FraserValley l #Kerrisdale l #Cloverdale l #Coquitlam l #Richmond l #PortMoody I #LynnValley I #EastVan I #SouthSurrey I #Clayton I #Kitsilano I #PortMoody I #MorganCreek I #PortCoquitlam I #Squamish I #Chilliwack I #Whistler #BCHOMEHUNTER.COM  #VANCOUVERHOMEHUNTER.COM  #FRASERVALLEYHOMEHUNTER.COM  #NORTHVANCOUVERHOMEHUNTER.COM  #WHITEROCKHOMEHUNTER.COM  #LANGLEYHOMEHUNTER.COM  #CLOVERDALEHOMEHUNTER.COM  #WESTVANCOUVERHOMEHUNTER.COM  #PITTMEADOWSHOMEHUNTER.COM  #BURNABYHOMEHUNTER.COM  #COQUITLAMHOMEHUNTER.COM  #DELTAHOMEHUNTER.COM  #MAPLERIDGEHOMEHUNTER.COM  #PORTMOODYHOMEHUNTER.COM  #SURREYHOMEHUNTER.COM  #SOUTHSURREYHOMEHUNTER.COM  #FORTLANGLEYHOMEHUNTER.COM  #MORGANHEIGHTSHOMEHUNTER.COM  #BCHOMEHUNTER.COMFasten your seatbelt folks, put your seat in the upright position and you better put that Starbucks non fat soy late down too! THERE IS NO HOUSING BUBBLE, and any misguided attempts to fix one will cause bigger problems in the long run according to Canadian Mortgage and business professionals. Unless of course politicians meddle in the market - then there is a qurantee it will either crash or they will just bleed it dry to pay for their collective election promises.

Do we detect a pile on effect taking place? Have they been listening to our own BCHH urban and suburban real estate analysts or perhaps they have gotten into the Koolaide or Mayor Moonbeams private reserve of BC bud? 

Anyone that hasn't self inflicted brain injury knows full well that here on Canada's ultra far left wing coast politicians and every manner of special interest group scream for more and more taxes and more and more spending on every manner of social program, housing project, unicorns, rainbows...you get the picture. So, it is of no surprise that Moonbeam and his merry band of socialists have been attaching the only real bell weather of the BC economy - real estate. 

YES, our very own real estate group have slammed the few corrupt realtors and anyone acting unethically - as we should! However, to cast a net over the entire profession here in British Columbia or Canada is like saying every single politician, journalist, teacher, doctor etc. in BC and Canada is unethical and corrupt. Perhaps we should be heavily regulating and examining everything the Canadian media says and does? No, we don't think so, that would be dictatorial and fascist wouldn't it.

Getting back to chicken little screaming and hoping the sky is falling for a moment. The headliner is one of the main takeaways of a new report from Mortgage Professionals Canada, the industry group that represents 11,000 mortgage brokers across the country.THE BC HOME HUNTER GROUP  Metro Vancouver I Fraser Valley I BC Urban & Suburban Real Estate Experts   You've noticed we're different. We specialize in you. Like us on Facebook and follow us on Twitter, Instagram, YouTube, Pinterest, Tumblr and Google+ 604-767-6736.  #Calgary #Toronto #Edmonton #Vancouver l #WhiteRock l #SouthSurrey l #WestVancouver l #Yaletown l #MapleRidge l #NorthVancouver l #Langley l #FraserValley l #Burnaby l #FortLangley l #PittMeadows l #Delta l #Richmond l #CoalHarbour l #Surrey l #Abbotsford l #FraserValley l #Kerrisdale l #Cloverdale l #Coquitlam l #Richmond l #PortMoody I #LynnValley I #EastVan I #SouthSurrey I #Clayton I #Kitsilano I #PortMoody I #MorganCreek I #PortCoquitlam I #Squamish I #Chilliwack I #Whistler #BCHOMEHUNTER.COM  #VANCOUVERHOMEHUNTER.COM  #FRASERVALLEYHOMEHUNTER.COM  #NORTHVANCOUVERHOMEHUNTER.COM  #WHITEROCKHOMEHUNTER.COM  #LANGLEYHOMEHUNTER.COM  #CLOVERDALEHOMEHUNTER.COM  #WESTVANCOUVERHOMEHUNTER.COM  #PITTMEADOWSHOMEHUNTER.COM  #BURNABYHOMEHUNTER.COM  #COQUITLAMHOMEHUNTER.COM  #DELTAHOMEHUNTER.COM  #MAPLERIDGEHOMEHUNTER.COM  #PORTMOODYHOMEHUNTER.COM  #SURREYHOMEHUNTER.COM  #SOUTHSURREYHOMEHUNTER.COM  #FORTLANGLEYHOMEHUNTER.COM  #MORGANHEIGHTSHOMEHUNTER.COM  #BCHOMEHUNTER.COM

Housing bubbles do not exist in Canada," the group's chief economist Will Dunning says in the report, adding that it would be "tragic" if any misguided attempts to fix a problem that doesn't exist were to happen.

The report cites U.S. economist Joseph Stiglitz as saying a key requirement of bubbles is that the price of something is "high today only because investors believe that the selling price will be high tomorrow."

In other words, a bubble occurs when people buy something solely because prices are rising quickly and they deduce that they will continue to do so.

Unlike other purely financial assets, which people primarily buy because they plan to sell them for a higher amount later, housing is different, because people's main motivation to buy is often to live in it.

That is why Dunning doesn't buy the housing bubble thesis. He says there are reams of evidence that suggest housing price appreciation is solidly backed by fundamentals — people want to buy houses because they want to live in them.

"Price growth in Canada, even in Vancouver and Toronto, is still consistent with the economic fundamental of interest rates and affordability," the report says.

In its recent Monetary Policy Report, no less than the Bank of Canada noted that it is on the lookout for "self-reinforcing price expectations" in the housing market.

As far as Dunning is concerned, however, there's little to worry about in the numbers, because he notes that while mortgage debt is increasing, with rates so low the amount of mortgage payments that go to paying down the principal versus interest payments is near record highs.

Still, group isn't without some concern about the housing market. On the subject of foreign buyers, the report does concede that there's at least anecdotal evidence that moneyed foreign buyers are driving up prices in Toronto and Vancouver, especially in the market for high-end homes.

As evidence, the group notes that in both cities the "rates of price increase are now much higher for single-THE BC HOME HUNTER GROUP  Metro Vancouver I Fraser Valley I BC Urban & Suburban Real Estate Experts   You've noticed we're different. We specialize in you. Like us on Facebook and follow us on Twitter, Instagram, YouTube, Pinterest, Tumblr and Google+ 604-767-6736.  #Calgary #Toronto #Edmonton #Vancouver l #WhiteRock l #SouthSurrey l #WestVancouver l #Yaletown l #MapleRidge l #NorthVancouver l #Langley l #FraserValley l #Burnaby l #FortLangley l #PittMeadows l #Delta l #Richmond l #CoalHarbour l #Surrey l #Abbotsford l #FraserValley l #Kerrisdale l #Cloverdale l #Coquitlam l #Richmond l #PortMoody I #LynnValley I #EastVan I #SouthSurrey I #Clayton I #Kitsilano I #PortMoody I #MorganCreek I #PortCoquitlam I #Squamish I #Chilliwack I #Whistler #BCHOMEHUNTER.COM  #VANCOUVERHOMEHUNTER.COM  #FRASERVALLEYHOMEHUNTER.COM  #NORTHVANCOUVERHOMEHUNTER.COM  #WHITEROCKHOMEHUNTER.COM  #LANGLEYHOMEHUNTER.COM  #CLOVERDALEHOMEHUNTER.COM  #WESTVANCOUVERHOMEHUNTER.COM  #PITTMEADOWSHOMEHUNTER.COM  #BURNABYHOMEHUNTER.COM  #COQUITLAMHOMEHUNTER.COM  #DELTAHOMEHUNTER.COM  #MAPLERIDGEHOMEHUNTER.COM  #PORTMOODYHOMEHUNTER.COM  #SURREYHOMEHUNTER.COM  #SOUTHSURREYHOMEHUNTER.COM  #FORTLANGLEYHOMEHUNTER.COM  #MORGANHEIGHTSHOMEHUNTER.COM  #BCHOMEHUNTER.COMdetached homes than they are for lower-priced townhomes and condominiums. In other centres covered by the CREA index, that pattern is absent."

its recent Monetary Policy Report, no less than the Bank of Canada noted that it is on the lookout for "self-reinforcing price expectations" in the housing market.

As far as Dunning is concerned, however, there's little to worry about in the numbers, because he notes that while mortgage debt is increasing, with rates so low the amount of mortgage payments that go to paying down the principal versus interest payments is near record highs.

Still, group isn't without some concern about the housing market. On the subject of foreign buyers, the report does concede that there's at least anecdotal evidence that moneyed foreign buyers are driving up prices in Toronto and Vancouver, especially in the market for high-end homes.

As evidence, the group notes that in both cities the "rates of price increase are now much higher for single-detached homes than they are for lower-priced townhomes and condominiums. In other centres covered by the CREA index, that pattern is absent."

"This is consistent with increased buying by affluent foreign investors, although it is not conclusive proof," Dunning says.

"We should accept that foreign buying is very substantial in Vancouver and that the Vancouver housing market is being severely distorted in consequence," the report said.

"In Toronto, we do not have the same amount of anecdotal evidence, but the recent great strength in the market and an acceleration of price growth have led to suggestions that a similar set of effects may now be developing."

Lawmakers in Ottawa are currently attempting a so-called "deep dive" for more information on the housing market, something that MPC supports, but cautions against drawing the wrong conclusions from the data based on misperceptions of a problem.

One of the factors being discussed would be an increase to down payment requirements, something that critics say would push house prices further out of reach for first time buyers while doing little to deter speculators.

"A much greater risk to the housing market would be policy changes by mortgage insurers or mortgage lenders that make it harder to finance home purchase," the report says.THE BC HOME HUNTER GROUP  Metro Vancouver I Fraser Valley I BC Urban & Suburban Real Estate Experts   You've noticed we're different. We specialize in you. Like us on Facebook and follow us on Twitter, Instagram, YouTube, Pinterest, Tumblr and Google+ 604-767-6736.  #Calgary #Toronto #Edmonton #Vancouver l #WhiteRock l #SouthSurrey l #WestVancouver l #Yaletown l #MapleRidge l #NorthVancouver l #Langley l #FraserValley l #Burnaby l #FortLangley l #PittMeadows l #Delta l #Richmond l #CoalHarbour l #Surrey l #Abbotsford l #FraserValley l #Kerrisdale l #Cloverdale l #Coquitlam l #Richmond l #PortMoody I #LynnValley I #EastVan I #SouthSurrey I #Clayton I #Kitsilano I #PortMoody I #MorganCreek I #PortCoquitlam I #Squamish I #Chilliwack I #Whistler #BCHOMEHUNTER.COM  #VANCOUVERHOMEHUNTER.COM  #FRASERVALLEYHOMEHUNTER.COM  #NORTHVANCOUVERHOMEHUNTER.COM  #WHITEROCKHOMEHUNTER.COM  #LANGLEYHOMEHUNTER.COM  #CLOVERDALEHOMEHUNTER.COM  #WESTVANCOUVERHOMEHUNTER.COM  #PITTMEADOWSHOMEHUNTER.COM  #BURNABYHOMEHUNTER.COM  #COQUITLAMHOMEHUNTER.COM  #DELTAHOMEHUNTER.COM  #MAPLERIDGEHOMEHUNTER.COM  #PORTMOODYHOMEHUNTER.COM  #SURREYHOMEHUNTER.COM  #SOUTHSURREYHOMEHUNTER.COM  #FORTLANGLEYHOMEHUNTER.COM  #MORGANHEIGHTSHOMEHUNTER.COM  #BCHOMEHUNTER.COM

"Now that the energy sector is no longer a major economic driver, a healthy housing sector is even more essential …. It would be tragic to unnecessarily impair this key economic force."

Does anyone else remember the horrific 1990's in BC when the NDP nearly destroyed this province with enough beaurocratic red tape, taxes and Cansian economics to choke an army? We understand our provincial government is doing its best to keep our province running and growing while the media, opposition and uber left special interest groups wage war against it. That's BC politics 101. Meanwhile anti industry mayor Moonbeam and his ilk continue to pander, tax, spend and social engineer metro Vancouver and choke the only golden goose it has. 

We have stated countless time, of course the real estate market will slow and change and speed up and grow, unquestionably. If politicians let nature take its course and stick to what their jobs really are, living off of tax payers and trying to play God.

Alright, there you have it folks, another less than entertaining real estate exposition. However, if you or anyone you know are considering the purchase or sale of any metro Vancouver, Fraser Valley or BC home or real estate don't hesitate to call us any time, 604-767-6736. We guarantee to tell you the truth about real estate!THE BC HOME HUNTER GROUP  Metro Vancouver I Fraser Valley I BC Urban & Suburban Real Estate Experts   You've noticed we're different. We specialize in you. Like us on Facebook and follow us on Twitter, Instagram, YouTube, Pinterest, Tumblr and Google+ 604-767-6736.  #Calgary #Toronto #Edmonton #Vancouver l #WhiteRock l #SouthSurrey l #WestVancouver l #Yaletown l #MapleRidge l #NorthVancouver l #Langley l #FraserValley l #Burnaby l #FortLangley l #PittMeadows l #Delta l #Richmond l #CoalHarbour l #Surrey l #Abbotsford l #FraserValley l #Kerrisdale l #Cloverdale l #Coquitlam l #Richmond l #PortMoody I #LynnValley I #EastVan I #SouthSurrey I #Clayton I #Kitsilano I #PortMoody I #MorganCreek I #PortCoquitlam I #Squamish I #Chilliwack I #Whistler #BCHOMEHUNTER.COM  #VANCOUVERHOMEHUNTER.COM  #FRASERVALLEYHOMEHUNTER.COM  #NORTHVANCOUVERHOMEHUNTER.COM  #WHITEROCKHOMEHUNTER.COM  #LANGLEYHOMEHUNTER.COM  #CLOVERDALEHOMEHUNTER.COM  #WESTVANCOUVERHOMEHUNTER.COM  #PITTMEADOWSHOMEHUNTER.COM  #BURNABYHOMEHUNTER.COM  #COQUITLAMHOMEHUNTER.COM  #DELTAHOMEHUNTER.COM  #MAPLERIDGEHOMEHUNTER.COM  #PORTMOODYHOMEHUNTER.COM  #SURREYHOMEHUNTER.COM  #SOUTHSURREYHOMEHUNTER.COM  #FORTLANGLEYHOMEHUNTER.COM  #MORGANHEIGHTSHOMEHUNTER.COM  #BCHOMEHUNTER.COM

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