“THE US DOLLAR IS THE MOST OVERVALUED CURRENCY AND PEOPLE ARE CRAZY TO GET INTO IT, BUT THEN THAT’S THE ONLY THING THERE IS, SO I HAVE A TON OF IT.”
- HOT PROPERTIES: A BRAND-NEW CONDO $164,000
- OZZIE TALKS (WHERE?)
- QUESTIONS, QUESTIONS
- ELECTION: CANADA
- MEDIAN, AVERAGE OR BENCHMARK PRICES?
- THINKING OUT OF THE BOX
- BINGE WORTHY NETFLIX
- THOMAS COOK COLLAPSE: AN OPPORTUNITY?
- EUROPE A BASKET CASE?
- EYEBROW RAISER
OUTLOOK 2020 USBs HAVE SHIPPED
- October 8th, 15th, 22nd, 29th – Personal Growth and Motivation
Downtown, 970 Burrard St.
- October 29th – BC Chapter of Real Estate Institute of Canada.
Luncheon 11:15am – 2:00pm: Delta Hotel, 4331 Dominion Street, Burnaby, BC
- October 30th – Surrey Board of Trade Development Industry Forum
Breakfast: 7:30am – 9:30am. Civic Hotel, 13475 Central Avenue, Surrey
- November 4th – Real Estate Action Group 6:30pm – 9:00pm
- You can listen to Ozzie every Saturday morning on Michael Campbell’s CKNW ‘Money Talks’ radio station between 9:35am and 9:45am
- See Jurock.com/events for more info
Q: YOU ALWAYS TALK ABOUT LOOKING FOR OPPORTUNITY AND “THINKING OUT OF THE BOX”. WHAT WOULD BE AN EXAMPLE?
A: A new highway: The Coquihalla made investments in Kamloops and Kelowna that resulted in great returns but the old highway cities such as Princeton/others saw real estate values decline. The same with the (then) new Island Highway where Comox became more valuable because you could get there faster. Or simply look for new development and buy older units close by. Once the new ones are finished, they lift the older ones up.
Last week Thomas Cook collapsed and lost $200 million dollars – why is that an opportunity? Up to 500 hotels in Spain closed and there may be incredible real estate deals where Thomas Cook sent its minions to – PLUS you can get a passport for buying.
Q: CAN I GET THE LIST OF 100 PROPERTIES?
A: We were swarmed. I will never offer that again (ha-ha). Over 500 of you requested – and received – the 100 Properties handout from the Real Estate Outlook 2020 conference (September 21st).
Q: LOVED YOUR PIECE ON BUYING A HOUSE IN AN ITALIAN TOWN AND GETTING PAID $27,000USD. DO I ALSO GET A VISA?
A: No, you can’t have everything – your exact status will depend on your nationality and the agreement Italy has with your country.
Q: I DON’T HEAR YOU TALK ABOUT CANADA’S ELECTION?
A: I don’t want to play politics, what I do want IS for YOU to GO AND VOTE.
There maybe a lot of other reasons you will rely on before you vote and for whom. From a real estate perspective note this:
- Conservatives would ease regulations to get new homes built. The party would raise amortization limits to 30 years for CMHC-backed mortgages and change the mortgage “stress test” for first-time buyers. It would implement a 20 per cent green homes tax credit for up to $20,000 spent over two years to pay for energy-saving renovations, and promises a public inquiry examining real estate money laundering.
- Liberals want to build 100,000 affordable homes over a decade and offer first-time home-buyer subsidies of 10 per cent on new home purchases and 5 per cent on resales — with restrictions. They want to retrofit 1.5 million homes for energy efficiency and offer interest-free loans up to $40,000 to make houses weather-resilient. They also want to introduce a 1% speculation tax, higher taxes in general on ‘the rich’ and deficits.
- NDP wants to build 500,000 affordable housing units over 10 years; until then, they propose a rental subsidy. They want to scrap the federal GST/HST for those constructing new affordable units. The party would reintroduce 30-year terms for mortgages insured by the CMHC for first-time buyers. It proposes a 15 per cent surtax on foreign buyers and doubling the home buyer’s tax credit to $1,500.
- The GREEN party proposes building 25,000 new affordable units and renovating 15,000 others. It wants to legislate housing as a “legally protected fundamental human right for all Canadians” and appoint a minister of housing to oversee the National Housing Strategy. The party also wants more resources available for housing co-ops and to scrap the Liberals’ first-time home buyer incentive.
BIG NOTE THIS: The NDP and the Green Party want to eliminate/reduce the capital gains exemption. (NDP to cut exemption in half – the Green Party eliminate it in total.) Oh, Joy! to anyone that is a risk taker.
Whichever way you want to vote – VOTE! Read each parties platform and how their plans will affect you PERSONALLY. One thing is certain, governments around the world are going broke and they will find a way to get their deficits covered by you!
It is my belief that the Liberals, NDP, Green all plan to attack your principal residence exemption (over time). The Liberals have already studied taxing offices in a home for business purposes (covered in my newsletter in 2017, when an Ontario MP pointed it out). That would mean that the percentage of your home a home office occupies (and you can deduct expenses from) would now attract capital gains tax when you sell your home. Already your Lane home is treated as such. (That’s just the start.) The liberals already got a home registry for us to sign last year as a first step.
No matter the outcome, its not ‘happy times’. I forecast at OUTLOOK a minority government. Minorities can work…but this one? Scheer & Trudeau each claiming legitimacy to govern. Singh in a supporting seat with May. The Bloc working under the table with CPC? The West unhappy at all combos. The GG? Economic consequences can be really bad. Tighten up your seat belt – wild ride ahead.
Q: YOU MENTIONED THAT EUROPE IS A “BASKET CASE”. I DISAGREE. IT IS JUST GOING THROUGH A PHASE. WHY WOULD THEY PICK CANADA ANYWAY?
A: Europe is indeed going through a phase! A phase of malaise (could not resist it)! $17 trillion negative interest rates centred mostly in Europe tell a horrible story. This will drive capital out of all European countries, to the US and to a lesser degree Canada.
Money is voting: One example is Decca Immobilien from Germany that just invested half a million in an Edmonton tower. Yep! Edmonton! Another example is that foreign fixed investment into Canada in August clocked in at $4.99 billion. Finally, Canada’s population is growing, while other G-7 countries experience population shrinking.
Capital is looking for return. There isn’t any and investors are playing the “yield hunger games”. The outcome is continued capital flight and people taking on too much risk, buying the wrong companies and the wrong real estate with poorer and poorer debt portfolios and poor areas.
What should you do? Pay off all loans and go long term. These lifetime low rates can get you to safety. You may even want to borrow the money at these incredible low rates and consider the interest payment like an insurance policy.
Michael Campbell and Michael Armstrong predict that there will be a credit crisis in 2020/2022. Be strong, get hard (cashflow) assets but get and stay safe as well.
At the Real Estate Outlook 2020 conference, I pointed out that certain cities in western Canada would be preferred and immigration Canada would “assist with the location”. We now have been told that ‘assistance’ has not yet been approved. We will keep you posted.
BOOK OF THE WEEK
Seth Godin, the author of the ‘The Purple Cow’. His newest book is titled ‘This is marketing’ a must read! Here the multi-talented Godin argues that “You can’t be seen until you learn to see”.
Lots of comments about the Conference Board of Canada, UDI, Bob Rennie and others calling all for a bottom in the market now (following my call – ha-ha). But yes, its true…the real estate market country wide is improving. Some of Ontario’s areas have seen a record price increases. Montreal and Ottawa are also nearing record prices and volumes. So, are we seeing the inflation in hard assets continuing?
Well, that was my point at the Outlook conference (print more money than we earn, and the extra money will settle in hard assets like real estate). The answer is yes, but not all real estate, select well.
Money is pouring into the US bond market because it still pays a return – albeit a small one. Last week ace trader Victor Adair reflected on this and raised a flag that perhaps “the biggest bubble could come from the bond market”. We are not experts, but caution is indicated, and this is why you must listen to Michael Campbell’s Money Talks – where Victor Adair (commodities), Michael Levy (gold) and myself (read estate) debate/dissect/discuss the future of all investments weekly.
BTW: The radio station is CKNW and the best way to listen to it is WHEREEVER YOU ARE IN THE WORLD, just visit www.cknw.com at 8:30 am every Saturday (PST), click on live and you’re good to go. I have personally listened to it in Singapore, Manilla, London, Australia – yup, the internet is everywhere!
WHAT THE HECK IS A MEDIAN, AVERAGE OR BENCHMARK PRICE?
Different news sources are seemingly reporting conflicting numbers for the same area and the same time frame. But what is reported, could be wildly different…
How useful is a price that covers an area from Maple Ridge to Lions Bay?
Questions you need to ask?
- Median, Average and Benchmark price is used?
- What is the difference?
- What area is covered…? Downtown – all of Vancouver Board area…what kind of property? Condo, Townhome and single family?
Here is why you need to know:
We count the average price between Maple Ridge and Lions Bay.
- Median $ 755,000
- Average 972,000
- Benchmark 990,000
Total Singe Family
- Median 1,280,000
- Average 1,507,000
- Benchmark 1,406,000
- Median 588,000
- Average 673,100
- HPI 651,000
Single Family sub area:
- West side 2,890,000 condo 789,000
- Maple Ridge 885,900 condo 625,000
Westside condo sub area
- Median 789,000
- Average 833,000
- Benchmark 754,000
See, what we mean…
Ok, what are the different prices:
If you were to take all of the sales within a given time period and put them in a list that ranged from the lowest price to the highest one, the median price would be the price value that is found right in the middle. Half of the real estate sales would be lower-priced, and half would be higher.
Median price is the middle point for real estate prices. It is not the same as the average price.
This price is found by taking the total dollar sales volume and then dividing this number by the total amount of sales. This number can sometimes be biased if a lot of lower-priced homes or higher priced ones have been sold within this certain time period.
Benchmark price (board use it)
The MLS® HPI tries to take housing quality into account, such as housing category, location, number of rooms, square footage, etc. It is subjective…
The MLS® HPI is conceptually similar to the Consumer Price Index (CPI), which tracks inflation by measuring the value of a “basket” of commonly purchased goods and services
The Housing Price Index determines the benchmark price and it is given based on criteria that is commonly found in other properties in the same area.
What is in the total average price in Vancouver?
- All townhomes, condos and SF are counted.
- What area is covered? The board trading area from Maple Ridge to Lions Bay
- The average condo price – condos only Maple Ridge to Lions Bay
- SF ditto – Maple Ridge to Lions Bay
As a buyer pick the price comparisons that you are comfortable with. Understand which price is quoted. Always compare the right one. But you need to go into each subarea…Richmond, Vancouver East, etc. to find the price in that area.
BINGEWORTHY NETFLIX SERIES
Fargo, this series has been around and because it was based on a movie with the same title, I assumed it was an extension. However, the Fargo TV seasons – while playing in Minnesota – are outstanding individual stories with surprising endings.
- Two Commercial Strata Lots – $178,000 in Pemberton – 4.6 percent cap rate
- Edmonton – 1-bedroom condo, brand new, underground parking, South Facing.5 appliances, Rent potential $1,350 per month. Price: $165,000! Sharp discount.
- Kelowna – Developer says sell! $50,000 discount 2-bedroom townhome, regular $499,000 – now only $449,000
NEW: You can buy both of Ozzie’s books and Ozzie’s 25 Money Making Principles on USB and the complete Land Rush audio on USB by ordering them here https://jurock.com/shop/
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!
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.
OZZIE’S YOUTUBE CHANNEL
You can watch all videos and podcasts on my YouTube channel at https://www.youtube.com/jurockvideo. It is a great way to check on what I said 10 years ago.
Ozzie is on air with Michael Campbell on the fabulous MONEYTALKS every Saturday sometime between 8:30AM – 10 AM. The radio station is CKNW and the best way to listen to it is WHEREEVER YOU ARE IN THE WORLD, just visit www.cknw.com at 8:30 am every Saturday (PST), click on live and you’re good to go. The Hot Property that we discuss there, is available by subscribing to the Oz Buzz Dispatch at Jurock.com
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LIVE LIFE LARGE
Wherever you go in life…
You take yourself with you
To change my outside world
I must change what I think about inside
I am perfect vibrational matc
Between my inner self…
And the life I lead
I will grow into my future best!
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