Entries Tagged as 'Housing'

Calgary Is Booming As Is Calgary Real Estate

Downtown Calgary

Downtown’s ever changing skyline. Richard White for the Calgary Herald

Mover Mike reaches many areas of the world and I am proud to say that Calgary, Canada is one.  Calgary is the fifth largest metropolitan area in Canada with a population of 1,096,833,. It is situated at the confluence of the Bow River and the Elbow River and approximately 50 miles east of the front range of the Canadian Rockies.

The economy of Calgary includes activity in the energy, financial services, film and television, transportation and logistics, technology, manufacturing, aerospace, health and wellness, retail, tourism sectors, and real estate. Calgary is home to the second-most corporate head offices in Canada.

Calgary is booming as is Calgary real estate. The metropolitan area has experienced a record-setting increase in net migration of more than 76,000 people between July 2011 and July 2013. The area is on track for a net gain of 40,000 in 2014. The Calgary Sun notes, “The people moving here, and the companies hiring them, need to have housing they can afford or the people will stop coming here and companies with available jobs will move to where housing is more affordable. Unfortunately, Calgary’s growth strategy does not promote housing affordability.”

If you are considering a move to Calgary, hire a professional among the many Calgary real estate agents to help with your search for housing.  Consider The Cliff Stevenson Group. Cliff Stevenson has recently built a new website that offers tons of information, including real estate search tools, buying and selling support, a blog with helpful real estate opinions and information, and market statistics.

Map Of Locations To Which Feds Are Shipping Illegal Alien Minors

Red flag has an interactive map of destinations of illegal alien minors in the USA. Here in Oregon it’s Morrison Child & Family Services

How do you feel about this “bigger than Normandy” Invasion?

Real Estate: “Millennials” Out, Chinese Buyers In!

Millenials shunning RE

Shunning Real Estate

by Mike Larson at Money and Markets

Homeownership is supposed to be the American Dream. As American as baseball, Fourth of July fireworks and fresh-baked apple pie.

But maybe not anymore, at least not to a new generation of Americans! Instead, these “Millennials” born in the early 1980s are shunning the market amid concerns about future financial stability, rising expenses and excessive debts. And who is increasingly filling the housing demand hole? Foreign investors, led by cash-rich Chinese buyers!

At least, that’s the conclusion of a fascinating pair of stories I came across today. One, from Bloomberg, bears the title Daughter Doesn’t Buy Dad’s Cheering of U.S. Homeownership.” The other, from Housing Wire, leads with the headline China Set to Dominate Foreign Homebuyers Market.”

First let’s look at homegrown buyers, and why they’re increasingly hesitant to buy. Bloomberg profiles Sara Stevens, the 27-year-old daughter of the Mortgage Bankers Association’s CEO. Though she is engaged to be married, and she and her fiancé have a six-figure income between them, she’s choosing to rent rather than buy.

Cash-rich Chinese buyers are flocking to the U.S. home market.
Why? Here’s Bloomberg’s conclusion:

“Six years since the collapse of Lehman Brothers triggered a financial meltdown, some young adults are more risk averse and view the potential upsides of status and wealth more skeptically than before the crisis, altering the homeownership calculation. It’s more than the weight of student loans, an iffy job market and tight credit — even those who can buy are hesitant.”

Some other fascinating stats from the piece:

First-time buyers accounted for just 27 percent of May sales, far below the long-term average of about 40 percent.

Only 52 percent of Millennials in one poll said homeownership is an “excellent long-term investment.”

Three-fourths of them believe the U.S. housing crisis hasn’t gone away yet, even though it’s been nine years since the peak of the bubble and almost six years since the depths of the Great Recession!
I talked about some of the issues related to the evolving attitudes toward housing in early May here in Money and Markets. And I discussed the Millennials’ student debt challenges in a separate column.

Suffice it to say these are not easily solvable. All the zero percent interest rates and QE in the world can’t change the psyches of potential buyers. Nor are they doing anything to curb the explosion in student loan debt. And that’s yet another reason why I believe the Federal Reserve’s policies are a waste of time and effort, and come with way too many negative side effects to continue pursuing.

But even as many Americans are finding the American Dream harder to pursue (or not worth the effort), foreign buyers from places like China are increasingly stepping in.

Housing Wire notes that foreign buyers purchased just over $92 billion worth of U.S. real estate in the year ending in March, up sharply from $68 billion a year earlier. A whopping 60 percent of them paid all cash, compared to one-third of domestic buyers.

“All the zero percent interest rates and QE in the world can’t change the psyches of potential buyers.”

Chinese buyers spent $22 billion of that total, the largest percentage by dollar volume. They now account for 16 percent of all foreign purchases, triple the level of just a few years ago. We’re still talking about a fraction of the overall volume of home sales here, mind you. But it’s the trend that’s noteworthy.

So what’s your experience? Have you been a home buyer or seller lately? If so, have you had to go up against cash-rich buyers and had a hard time as someone who is buying with a mortgage instead? Have you benefitted from an influx of foreign cash?

What about family members? Do you have kids or grandkids or nephews and cousins between the ages of 18 and 35? Are they having trouble buying a house, or choosing to rent even when they can buy?

Inflation: Higher And Higher We Go

Economics / Inflation
Jul 08, 2014 – 10:48 AM GMT
By: Darryl_R_Schoon

Economics
In the end game, truth is found only at the margins

In Time of the Vulture: How to Survive the Crisis and Prosper in the Process(2007, 2012 3rd edition), I wrote about inflation and its root cause:

In a credit-money system, over time the constant infusion of increasing amounts of credit will inevitably lead to higher and higher rates of inflation. Because common knowledge of this fact is not in the best interests of those benefiting from the system, it is hidden away. And in the US, hiding the real rate of inflation is done the old-fashioned way, by lying about it.

Prior to the 1990s, the cost of a basket of standard goods and services was compiled. This was called the consumer price index, the CPI, and any rate of increase was considered to be the actual rate of inflation. However, in the early 1990s, this began to change.

Perhaps the old method of tracking inflation seemed outdated or quaint, much like the Geneva Accords [which outlawed torture], to Alan Greenspan and Michael Boskin, the chief economist under President Bush Sr., and a newer way of calculating the CPI was needed.

What was needed was a way that would show a slower rate of increase rather than the actual rate, a way that would save the US government money by lowering social security payments and Medicare benefits tied to the CPI, a way that would convey to global investors that all was well in America, that inflation was under control.

The government keeps changing the rules

Changing the way inflation is calculated

Irrespective of what the newly reconstituted CPI says about inflation, its effects cannot be hidden. Remember Motel 6? A low cost motel chain started in Santa Barbara, California in 1962 whose advertised price was a part of its name, $6.00 per night for accommodations.

I recently checked the prices Motel 6 charges, forty-four years later. The current room rates of Motel 6 at three different locations in Santa Barbara are:

1962 2006

Motel 6 location #1 $6.00 $105.99 an increase of 1,767 %

Motel 6 location #2 $6.00 $82.99 an increase of 1,383 %

Motel 6 location #3 $6.00 $61.99 an increase of 1,033 %

Home prices are also higher as advertised in Morris County New Jersey.

1966 2006

Three bedroom home $15,900.00 $399,900.00 an increase of 2,515 %

Four bedroom home $19,000.00 $624,900.00 an increase of 3,289 %

Marijuana also shows a similar increase in price since the 1960s.

1966 2006

One lid of pot $10.00 $250.00 an increase of 2,500 %

The cost of attending college at the University of Minnesota also rose.

1968 2004

Cost per unit $8.25 $183.00 an increase of 2,218 %

THE DIFFERENCE IN PRICES

BETWEEN THEN AND NOW

IS DUE TO INFLATION

INFLATION IS THE INCREASING COST

OF GOODS AND SERVICES CAUSED

BY THE CONSTANTLY DECLINING

VALUE OF PAPER MONEY OVER TIME

THE MORE MONEY YOU PRINT

THE LESS IT’S WORTH

ECONOMICS – SHILL OR SCIENCE

HELOCs and No-Doc Loans Are Back

HELOCs and NO-Doc Loans Are Back

HELOCs and NO-Doc Loans Are Back

America, it’s safe to go back in the real estate waters again. The banks are loaning money for No-Doc loans and the WSJ tells us that HELOCs are back. Debt is GOOD!

What did the banks learn? Nothing! Who bailed out the banks? You and I did. And like the swallows returning, this new lending will get the banks in trouble in the next downturn and we will bail them out again.

Rinse and repeat. The incentives haven’t changed. The banks win and the upper-level employees get fat bonuses. The banks lose and you bail out the banks.

Listen to the WSJ:

“Banks have been emboldened to originate new Helocs in part because new regulatory requirements completed this year and last year make it less burdensome to do so. And in an era where interest rates are expected to rise in the future, some lenders say they prefer Helocs over some other home-equity products because interest rates on Helocs rise as interest rates rise, making the products potentially more profitable. (emphasis added)”

Sickening!

There’s A Lesson Here!

The Chicago teachers strike is over. Now the 17.6% raise over four years must be ratified by the union membership. One problem, the city can’t afford the contract. In the end teachers will be laid off and class sizes will go up, until the richer parents take their children to private schools. Politicians will search for new revenues to cover the shortfalls.

Our neighboring city Gresham wants to add $7.50 a month to the water bills to pay for police and parks. The mayor says he’s cut everything he can and now he needs additional revenues. It’s only $7.50 per month. Surely, the citizens of Gresham will pay that little bit for police protection.

Portland can’t seem to educate it’s students, no matter how much money is given to them. Now we will be asked to pass a bond measure of $482 million to correct all the differed maintenance issues. It’s only $1.10 per $1,000 of assessed value for eight years. (My assessed value is about $250,000, so I will be asked to pay an additional $275 this year and that will grow to at least $350 in the eighth year.) Surely, the voters value education and don’t want their schools to fall apart.

In addition, we will be asked for $35 per-person tax to support Portland Public Schools to offer art and music instruction. Surely, you realize the value of art and music. It’s only $35 per person per year.

The lesson for all is giving money to a politician only encourages them to spend more money and come back for more and more and more. Soon, many of us won’t be able to afford to live here and we will take our boomer lives elsewhere.

Portland Home Prices Make New Lows

Zero Hedge reports on the Case-Shiller home price data for January,2012 and finds “…that in the first month of the year, prices across the top 20 MSAs dropped once again, posting a 9th consecutive decline…”

“Despite some positive economic signs, home prices continued to drop. The 10- and 20- City Composites and eight cities – Atlanta, Chicago, Cleveland, Las Vegas, New York, Portland, Seattle and Tampa – made new lows,” says David M. Blitzer, Chairman of the Index Committee at S&P Indices.


Meredith Whitney Delivers


Neighbor vs. Neighbor In HOA

I’ve written about this before, but homeowners associations (HOA) keep breaking in to my consciousness. Yahoo reports today: “Neighbor vs. neighbor as homeowner fights get ugly
As more are unable to pay homeowners’ fees, associations pit neighbor against neighbor.”

I was once again reminded of a book I read, titled “The Association” by Bently Little. This book scared me enough that I will never willingly join such a group. Cahners Business Information, Inc. describes the book:

Barry and Maureen Welch are thrilled to exchange their chaotic California lifestyle for the idyllic confines of Bonita Vista, a ritzy gated community in the unincorporated fictional town of Corban, Utah. But as Bonita Vista residents, they are required to become members of the neighborhood’s Homeowners Association, a meddling group that uses its authority to spy on neighbors, eradicate pets and dismember anyone who fails to pay association dues and fines. Maureen, an accountant, and Barry, a horror writer who is banned by the association from writing at home, soon find themselves trapped in the kind of deranged world that Barry once believed existed only within the safety of his imagination.


Inflating The Money Supply Causes Problems!

Many of you have seen this chart of the adjusted monetary base:

I was reminded of the chart when I received the latest “Early Warning Report” written by Richard J. Maybury. He writes,

When the FED inflates the money supply, the money does not descend on the economy in a uniform blanket. Some areas receive a lot of new cash, others receive less, and still others none at all.

Areas that receive a lot become hot spots. The hot spots deceive business managers and investors, who create new firms or expand existing ones in those areas.

Key point: these firms become dependent on the influx of fresh money.

If the influx slows or stops, the firms go broke.

If you want proof, just look at the housing industry and all that depend on new housing from suppliers, architects, interior designers, furniture stores, mortgage brokers, real estate agents and banks. All have experienced the worst times of the last ten years.

Remind me again why we allow government to help us!

Copyright © 2007 Mover Mike. Design by Anthony Baggett.


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