Economy 52,847 Posted March 4, 2020 Share Posted March 4, 2020 https://www.bnnbloomberg.ca/bank-of-canada-follows-fed-with-rate-cut-as-virus-fears-mount-1.1400012 At today's meeting Canada has decided to lower it's benchmark by 50 basis points down to 1.25% from the previous 1.75% given concerns over economic impacts of corona virus Yesterday the US announced a cut of the same size also 0.5% Link to post Share on other sites More sharing options...
Woolfsmck 2,763 Posted March 4, 2020 Share Posted March 4, 2020 This will help some of the business that are getting damaged by the panic ... Can't say it helps me much … but it's one of the methods they have to keep the economy healthy in a potential crisis. like a cat in a sil, I observe life, moving and still. My words give a clue,look inside to see whats true Link to post Share on other sites More sharing options...
Economy 52,847 Posted March 4, 2020 Author Share Posted March 4, 2020 15 minutes ago, Woolfsmck said: This will help some of the business that are getting damaged by the panic ... Can't say it helps me much … but it's one of the methods they have to keep the economy healthy in a potential crisis. My only concern is it will only further fuel the housing market which is in its 20th year into the boom not to mention our sky high consumer debt Just to give u an idea, the National average home price in Canada is now roughly double of the US (and yes that's accounting for difference in currency) And they are expecting double digit increases in home prices and rents AGAIN in 2020 At this rate our homeless rate (which surpassed the US years ago) is gonna start to look like a developing Country SMH Link to post Share on other sites More sharing options...
Woolfsmck 2,763 Posted March 4, 2020 Share Posted March 4, 2020 6 minutes ago, Economy said: My only concern is it will only further fuel the housing market which is in its 20th year into the boom not to mention our sky high consumer debt Just to give u an idea, the National average home price in Canada is now roughly double in the US (and yes that's accounting for difference in currency) And they are expecting double digit increases in home prices and rents AGAIN in 2020 At this rate our homeless rate (which surpassed the US years ago) is gonna start to look like a developing Country SMH Yeah, speculative property investors are , in part, to blame for the rise in housing … There needs to be policy adjustments to encourage developers to build low end affordable homes that fit a larger spectrum of the income levels in the economy ... Its, not just the US that has this issue apparently . like a cat in a sil, I observe life, moving and still. My words give a clue,look inside to see whats true Link to post Share on other sites More sharing options...
Economy 52,847 Posted March 4, 2020 Author Share Posted March 4, 2020 1 minute ago, Woolfsmck said: Yeah, speculative property investors are , in part, to blame for the rise in housing … There needs to be policy adjustments to encourage developers to build low end affordable homes that fit a larger spectrum of the income levels in the economy ... Its, not just the US that has this issue apparently . They have to an extent The bigger cities like Toronto and Vancouver have a foreign buyers tax now to discourage international investors. Some have also introduced a Vacancy tax so investors are encouraged to at least rent it out whole they hold it They also added multiple tighter regulations over the years - max amortizations down to 25 years - 20% downpayment required, some people can get as low as 5% if they meet very tough guidelines tho - Default insurance must be purchased for lower downlayments - 2% stress tests so whatever rate u get, u have to now qualify for 2% higher. So if bank gives u mortgage at 3.5% u have to qualify for 5.5% But honestly I don't think in Canada's case speculation is the biggest issue even if it may play a role Construction just consistently isn't keeping up with demand and vacancies are so low that the bidding wars never end both for tenents and renters and home buyers alike Rapid population growth and high immigration + slow construction and permit laws = housing crisis of gigantic proportions The major US housing boom lasted 6 years (2001 to 2007)... The longest major booms in history were in Japan and Swtizerland both lasting just over 20 years in 1980s & 1990s... It led to a bubble burst in both Japan and Switzerland So Canada is about to surpass Japan and Swtizerlands boom in terms of length of time. Ud think a boom would cause surge in construction followed by over supply and then crash... But given in Canada our supply and demand refuses to balance itself out I don't see the prices coming down anytime soon and I blame our government for its red tape Seriously a 10 year process for a new condo to be approved in Toronto? Link to post Share on other sites More sharing options...
Dr Fudge 8,674 Posted March 4, 2020 Share Posted March 4, 2020 My dumb a$$ read this as “Camilla joins USA in 0.5% rate cut” I was like “well that’s a strange swerve for a pop star, but ok” Been a cuff touple, a puff bupple, a tough couple of years. Link to post Share on other sites More sharing options...
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