//Oz Buzz #16 – Year-End Thoughts / Forecasts and Predictions

Oz Buzz #16 – Year-End Thoughts / Forecasts and Predictions

Oz Buzz

“God speaks to all Mutual Fund managers first and then she speaks to you second.” 

–David Bond. Hmm!? Now she speaks to the machines first?

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Today Issue:

  • Year-end thoughts
  • One-line predictions
  • Forecasts and Predictions
  • Numbers to study
  • Opportunities 2019
  • Inward migration will save our markets
  • To do

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Year-end Thoughts

Well, last week of 2018. The end of this incredible fast moving/eyebrow raising real estate year draws near and our e-mail servers sigh with relief. What an incredible real estate year. Volumes of sales crashed, Listings soared, but prices (mostly) held in there. But more on the numbers in next issue … when year-end reports are in. But it wasn’t just the real estate markets, government blunders and the like … stock markets had its worst December since 1931 with unbelievable volatility seemingly the norm.

So, we shut down the workshop for a couple of weeks, sent the hardworking elves home for the holiday’s and settled back with a large ‘Beautiful’ (Cognac and Grand Marnier). Why is it called a Beautiful? Have 3 and you will feel beautiful!

As always, we pondered a truism: If the year has been tough, bid it adieu and prepare for the next with optimism and courage. Count your blessings, the loved ones around you and be glad for the ones remaining – family, friends, heirs and hairs alike. … Sorry, blame the ‘Beautiful’… never mind… If the year has been good, be thankful but not complacent. Too much success arrived at too easily tends to make one soft and slow moving. (Yes, yes, too much special ‘Beautiful’ does the same, but we all need our small vices.) Still the big question: What will 2019 bring?

Well, the year 2019 needs YOU to take a hard look at your business and your personal life to see whether you are part of the new world – fast paced, high technology, pounding changes. Used to be that change was predictable and you had time to adjust. Today? Not so. Change is accelerating exponentially.

Computers, biotechnology and nanotech are self-accelerating. They grow because they grow. The products of their own processes enable them to develop even more rapidly. New computer chips are immediately put to use developing the next generation of more powerful ones creating an inexorable acceleration. The same dynamic drives biotech and nanotech – even more so because all these technologies tend to accelerate one another. Computers are rapidly mapping the DNA in the human genome, and now DNA is being explored as a medium for computation. When nanobots are finally perfected, you can be sure that one of the first things they will do is make new and better nanobots.

Nanobots? G-Nome? Virtual Reality? Huh? Well, maybe we don’t need to adjust to everything new at once. Maybe we can improve on what we have. 
As we quoted Mike Vance at our Outlook conference on September 22, 2018: “Innovation is the creation of the new or the re-arranging of the old in a new way!” and told you the story of how by making a small change (i.e. turning a straight shower curtain rod into a curved one) you can often re-arrange the old in a new (and profitable) way. 

In 2019 ask yourself, what new thing must I learn/create or what of my ‘old ways’ can I re-arrange into the new? It may be just a minor change that will pay big rewards – a tweaking, a fine tuning…but you need to plan for yourself and your business. Let’s face it:

  • “IF YOU DO NOT HAVE A PLAN FOR YOUR LIFE…
  • YOU BECOME SOMEONE ELSE’S PLAN!”

Whatever 2019 holds in store, everything that happened before will pale with the wonders of the future. Be part of it. The New Year approaches and anything can happen. So, make it happen.


From all of us here at Jurock’s Real Estate Insider and OzBuzz (ozbuzz.ca) we wish you a significant, challenging, exciting, reflective, creative, passionate, committed, successful and above all healthy year of wonder and personal growth.

TODAY, SOME THOUGHTS ABOUT THE – SURE TO BE – VOLATILE FUTURE:

Many inquiries and comments on “My body is the temple of my mind”. 42 responses …who says we are all business? The one I liked best: “Nothing hit me more than your statement of the body temple. I feel the truth of it. My body is in great shape. I spend a lot of time in the gym. Me, myself, my goals, my dreams…all left wanting. I’m going to spend the same discipline on my mind in 2019.”

FORECASTS AND PREDICTIONS – Ozzie Opinions

Key: Stock markets
Biggest December decline since 1931
Markets will be driven by (machine)scenario analysis
War of the machines. Stock volatility is entirely due to machine trading
Volatility machines don’t react to economy just algorithms
Some algorithms are forcing buyers to sell. 
Trend following models distort and destroy markets.
Be careful. Machines took markets higher and machines took them lower – more of that in 2019

Trillion dollars per year needed in corporate refinancing for 7 years
1 trillion-dollar high grade bonds will be downgraded this year 
Corporate deleveraging fallout will be slow capital spending
Lots of leverage needed to refinance 
Watch companies that have a lot of debt 
Revisit my piece on QT and QT. QT is taking $50 billion a month out of the market now
Retiring $50 billion a month creates illiquidity. There will be a liquidity crisis.

Key: Loans and rates 
War on interest rates. David Rosenberg predicts a decline in interest rates, we believe rates will increase in Canada and the US.
If Rosenberg is right, stocks will rise…otherwise continued mad volatility
Result is unpredictable. Volatility is here to stay,
Likely more illiquidity.
Mortgage rates higher and harder to get.

KEY: REAL ESTATE
War on real estate markets by Government will continue 
2019 will see higher vacant home tax, higher school tax, higher property taxes, higher carbon taxes, higher rent, higher Canadian Pension Plan premiums, higher car insurance rates, a new speculation tax for real estate, a new healthcare tax and higher interest payments.
Condo price better than SF prices
Condo prices in the Valley better than in town
Luxury condo price will decline sharply
Sales will continue to decline, listing continue to increase…prices vary by product (condo better) and by area (Westside SF down 21%, Surrey even.)

KEY: OIL/GAS
US builds 7 pipelines now. Canada none. Bill C69 will kill all incentives to invest in our markets
Prices on oil depends on fracking and politics – expect them to rise. Worst event for real estate and BC economy. Exxon pulls out of a $25 billion LNG PROJECT. No one wants to invest in Canadian projects because the environmentalists and natives have taken over. Schachter sees oil much higher.

KEY: WORLD
War on the middle class
War on populism 
Europe slow down
Emerging markets slowdown
Populism, mini collapse of EU will drive more people with money to Canada

KEY: CURRENCIES 
Canadian dollar – we forecast 73 cts. We are here this week. Short term higher – long term lower. Next target .72 cents
US dollar – higher

BIGGEST FEAR?
Quantitative (QE) easing has become now Quantitative tightening (QT). It is for real. In two of our conferences last year I talked about the QT effect (outcome unknown but scary). QT is big news. 

In my view, October crashes occurred around the world when central banks let their bonds expire. Sugar rush of cheap money is now over. 

KEY: TAXES
2019 will see higher property taxes, higher carbon taxes, higher rent, higher Canadian Pension Plan premiums, higher car insurance rates, a new speculation tax for real estate, a new healthcare tax and higher interest payments. The bottom line – governments are making sure you have less money.

KEY: BEST NEWS FOR BC
New immigration numbers:
​In the last twelve months B.C.’s total population grew by 70,763 persons (+1.43%) over the twelve months ending September 30, 2018, mostly due to international migration.

On an annual basis, net international migration accounted for a gain of 59,466 while net interprovincial migration contributed 5,474 persons from October 1, 2017 to September 30, 2018. Natural increase added another 5,823 people during the last twelve months. 

Combined net in-migration from all sources (interprovincial and international) totalled 22,205 persons during thethird quarter of 2018, 8% higher than the same quarter in 2017. Most of the population growth in the third quarter was due to international immigration. Broken down, net international in-migration contributed 23,422 persons to population growth, offset by a net interprovincial migration loss of 1,217​. 

​An inflow to B.C. of 13,479 was offset by an outflow of 14,696, for a net loss of 1,217.

TO DO:

  •  Read/understand implications new Land Act when released
  •  Pot – make rules – Just because it is legal you can still forbid it grown in your house!
  • Dispute your assessment. Go to BC assessment site and check out your recent sales/prices

BEST OPPORTUNITIES:

  • Buy real estate for movie production
  • Rent luxury – buy cash flow: Airbnb crackdown – allows for cheaper rent of luxury units. So…? Rent in town, buy commercial real estate for investment?
  • Check out assignments (CL and KJJI) – buy someone else’s fear – cheap.
  • Check unreserved auction, Alberta or USA.
  • Buy COMMERCIAL! Industrial – less hustle! No foreign buyers tax! Easier to make rules…no bad legislation pending!
  • By small town cash flow (no foreign tax). Price and rent ratios turning optimal in Alberta and small-town BC

NEXT WEEK:

  • Real Problems
  • Cash is not Trash
  • Economy unravelling
  • Year end numbers comparison
  • Most astounding numbers
  • Forecasts

AUDIOBOOK

Too busy to read? Want to listen to Ozzie’s book for free? Sign-up for a free trial at Audible by clicking HERE and get Real Estate Action 2.0 FREE!

WANT TO PARTICIPATE?

Go to www.realestatetalks.com – Some 2,500 members (47,009 posts) talk real estate. Ozzie created this bulletin board in 1998!
BCRED.CA. If you are in a real estate related industry of any sort (realtor, appraiser, lawyer, home inspector, etc.) list yourself in Ozzie’s free British Columbia real estate directory at www.bcred.ca. Jurock.com sees 31,000 unique visitors every month…a lot of them look for their professional here. SIGN UP…!

OZZIE’S YOUTUBE CHANNEL

Watch his new video on Ozzie’s Picks – Oliver, Pemberton and Victoria here: https://www.youtube.com/watch?v=cyejcpi0Ecw and you can subscribe to his channel and see all his videos, including selected bits of the fabulous Michael Campbell show and the “Blast of the Pasts” – watch what Ozzie said in 2010 on BCTV and more.

RADIO

Ozzie is on air with Michael Campbell every Saturday sometime between 8:30 AM – 10 AM. The Hot Property that we discuss there, is available by subscribing to the Ozzie Dispatch at Jurock.com.

LIVE LIFE LARGE

Like attracts like
Smile and the world smiles back
Happy people attract happy people
Birds of a feather flock together
What goes around comes around
Our intentions must be clear
Or we attract confusion

The universe wants clarity
I have clear intentions
I draw people with harmonious intent
I will repel what is not in harmony
I will define what I want every day
I will draw to me those people
Who will enhance me
I will have joyous interaction

I will grow into my future best

Look up all of the “Grow into your future best” cards at: www.commitperformmeasure.com

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Disclaimer

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)” or the “Jurock Case Real Estate Action Group (JCREAG)” 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 JREI and JCREAG, 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 JREI and JCREAG 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 JREI and JCREAG, 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 this postings. If you respond to any posting JREI and JCREAG fully expect that you get independent legal/tax/investment/mortgage advice as the case may be.

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By |2019-01-16T20:35:52+00:00January 7th, 2019|Oz Buzz|0 Comments

About the Author:

Ozzie helps members build an action plan toward real estate success with his Real Estate Action Group, arming investors with the best information and insights possible with his Jurock Real Estate Insider. More info OzzieJurock.com

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