“Congress can raise taxes because it can persuade a sizable fraction of the populace that somebody else will pay.”
OZBUZZ #11 plus Hot Properties
#OZBUZZ #REALESTATEMARKET #AUDIOBOOK #MORTGAGERATES #WORLDVIEW #ITALY #TEDTALKS #LIVELIFELARGE #QEANDQT #CANADIANDOLLAR #DIDO #YOUTUBEJUROCKVIDEO
Today’s issue: Italy won’t listen. QT shakes markets? Interest rates. Taxes add 26% to condo cost. New Binge shows. Listen to TED TALK show on millennials. Ozzie on air. People don’t do what you expect; they do what you inspect with respect.
Comments From You
- ‘Behzat’ is back on Netflix. Great show.
- I just loved the book “Never fight with a pig” by Peter Thomas.
- I was curious on the shotgun clause. What I got was great negotiation advice.
- I looked up QT on the internet. Now I am scared.
- I liked the Numbers. I found the 2016 comparison surprising.
- I love your worldview. Keep it up.
Comments From Me
- The stock market crash 2 weeks ago was precipitated by on ‘outlier’ of QT, a liquidity crunch, as borrowers scrambled for money, driving the 10-year rate over 3.22%. These crashes will continue. Volatility will be the new norm.
- US 10-year rate may hit 4% end of 2019/2nd quarter 2020
- Italy refused to bow to EU – says there is no plan ‘B’. Sell Italy, Spain, Germany.
- Don’t worry about the borrowing nations – worry about the lender nations and their banks!
- Mortgage rates will rise continuously next year.
Q. I’m waiting for your update on the Canadian dollar because I like to invest in currencies.
A. WHOA! I am only commenting on the Canadian Dollar because we have several friends/clients that invest in real estate in the US. I am not a stock market advisor, I am merely sharing my opinion – for what its worth. As of October 17th the Canadian dollar acted as we forecast – up after the NAFTA agreement and we expected it to go down after the Canadian interest rate increases on October 24th. Martin Armstrong, Victor Adair and Michael Campbell all expect the dollar to see $.73. BUT – hey – no guarantees!
Q. What about mortgage rates? Will they come down with the Canadian dollar?
A. Long-term mortgage rates in Canada are tied to the bond rates. Short term (variable rates) are tied to the prime rate. Bond rates are rising dramatically (today 3.23% for the ten-year rate). I expect a continuous rise, thus long-term mortgage rates will continue to go up. We expect US and Canadian prime rates to go up as well.
Canada: October & January and 3x more in 2019.
The US: Up in December and 4x more in 2019.
Most mortgage brokers advise that it would take 8 more rises on the prime rate to make up the difference in a five-year rate and current variables. They advise to keep short. They may be right. Personally, I think that you should tie up your interest rates to the length of time that you expect to keep the property (as an investor). It is safety that you want, not uncertainty. Where else can you fix your costs so easily and make your cashflow predictable? As a flipper of course, you go short term, variable and open.
Q. Any new binge TV shows?
A: We liked Rita. I guess we like all Nordic shows. This show keeps you engaged. Independent, outspoken and adored by her students, schoolteacher Rita fares less well with adults in this comedy-drama from Denmark.
Q. I recently ran across TedTalks and there are hundreds of them. Any that you like?
A: I very much like TedTalks, in particular the talks by Simon Sinek on the “why” as opposed to the “what”. As well his talk on ‘Millennials’ is absolutely brilliant, funny and a ‘must listen to’ https://www.youtube.com/watch?v=vudaAYx2IcE
Q: I just listened to Michael Campbell’s interview with Greg Wheldon. Crash ahead? Buy gold and silver?
A: You should listen to Mike every week. Indeed. I have never been a fan of gold and silver. However, with what’s happening in markets, tariffs, trade wars … and the Black Swan of QT, anyone with large assets can take 10% into gold and 5% into silver. I have been preaching cash for a while now (depending on your age) and as hard assets fall, you WILL make money. (I just missed out on an assignment that was $46,000 cheaper than an identical condo sold for in May.)
Surprise: Government is the problem: Taxes, taxes – a 26 percent tax increase on a new house!
Paul Sullivan, a partner at Vancouver’s Burgess, Cawley Sullivan and Associates, based his calculations on a new, one bedroom and den Cambie Street condo in Vancouver priced at $840,000. Costs: city fees and taxes, a community amenity contribution, development cost levies, the vacant home tax, property taxes, regional water and sewer charges, Translink’s new regional development cost, the speculation tax, property transfer tax and GST. After accounting for the labour, materials and time to build the condo unit, $220,000 had to be set aside to pay for all the government taxes, levies and fees. That’s an additional cost of 26 per cent. So, a condo that could sell for $620,000 now sells for $840,000. Government: Don’t do anything new – just stop doing what you are doing now. Property taxes are up 22% since last election.
- Interviews and videos with ACE mortgage brokers, ACE developers and ACE motivators.
- Questionnaire: After our first 11 issues we like to assess how we are doing in YOUR eyes. Please help by answering a few questions in an upcoming Survey.
USB ROCKS – AUDIOBOOK
Too busy to read? Want to listen to 2 of Ozzie’s books!
- Real Estate Action 2.0
- What, Where, When and How to buy real estate in Canada!
No worries: I am not reading it. Haha! We have a bright young man with great intonation doing the honours. His name is Brady Nelson. You will hear a lot more about him in future.
The neat thing about audio books on USB is, that the USB reader shows the list of chapters – for easy scrolling. New cars (since 2015) all have USB readers installed.
Ozzie is on air with Michael Campbell every Saturday on CKNW 980 sometime between 8:30AM – 10 AM. The Hot Property that we discuss there, is available by subscribing to the Ozzie Dispatch at Jurock.com
Look at Ozzie’s YouTube video– including selected bits of the fabulous Michael Campbell show and the “Blast of the Past” – what Ozzie said in 2010 on BCTV…
Houses with rentals
1. North Surrey, 5 bed, 3 bath house with a 2-bed suite, on a 7200 sq. ft. lot. Price: $799,000
2. North Delta, 4 bed, 2 bath home on a 10,000 sq. ft. lot. Price: $899,000
3. Vancouver: Commercial Drive area, 5 BR, 4 baths with 3 rental suites. Price: $1,350,000
4. Vancouver, Victoria Drive area, 5 bed, 3 bath home with a 2-bedroom rental suite. Price: $1,125,000
5. Victoria, 4 BR, 2 baths, 8,250-foot lot. (Best) Price: $639,000
LIVE LIFE LARGE
People do not what you expect,
They do what you inspect…
Have a great week and grow into your future best self!
LIVE LIFE LARGE!
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