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Old 03-14-2016, 12:17 AM   #5301
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Originally Posted by SumAznGuy View Post
You aren't giving us much information other than 0% financing and able to borrow more than the value of the car.
For starters, is the loan through a bank or through the brand's financing department.
AT 0% interest, how long is the loan good for and is there any hidden fees?
Generally speaking, there's no such thing as a free lunch. If it is too good to be true, it generally is.
Why are they loaning you money for free when that money can be used elsewhere to try to generate revenue, possibly by moving one of their cars?
you're reading too far into it. its just a desperate sales plea to try to get people in and trapped in something new they can barely afford.
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Old 03-14-2016, 09:09 AM   #5302
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My personal opinion is that if regulation were to be instilled, it would have to be a slow integration. Just like raising interest rates. Canadians are far too invested in real estate, and any major change could cause a melt down. I have no facts for this, just an uneducated theory from watching Hollywood films such as "The Big Short" and books like "When the bubble bursts,"
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Old 03-14-2016, 09:34 AM   #5303
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My personal opinion is that if regulation were to be instilled, it would have to be a slow integration. Just like raising interest rates. Canadians are far too invested in real estate, and any major change could cause a melt down. I have no facts for this, just an uneducated theory from watching Hollywood films such as "The Big Short" and books like "When the bubble bursts,"
100% the gov would never take the fire extinguisher to the housing market, they would simply adjust policy to cool things off slowly... very very slowly.

The bigger issue would be sentiment, when people believe something will cost more in 6 months they are more inclined to buy, when people believe something will cost less in 6 months, they are more inclined to sell.

Just as you had people rushing to the check out to buy homes up when sentiment is bullish, you will have everyone rushing to the exits when sentiment goes bearish. It's the severity in this change in perception that would ultimately determine whether or not the gov can provide housing with a soft landing.
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Old 03-14-2016, 10:03 AM   #5304
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Was going to post the article here but there's an interactive graph embedded in the article

Canadian household debt soars to yet another record - The Globe and Mail


And here is a link to the report by Stats Can

The Daily$—$National balance sheet and financial flow accounts, fourth quarter 2015

TL;DR: Low interest rates translate to GIMME GIMME GIMME
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Old 03-14-2016, 10:23 AM   #5305
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I think that report saying only 1 out of 8 condos I'm Vancouver are unihabjited was a huge blow to the affordable housing advocates.

I'm sure they all Expectsd it to be 1/4 or more. 1 out of 8 is nothin and probably the norm for a lot of big cities.
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Old 03-14-2016, 10:41 AM   #5306
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Originally Posted by SumAznGuy View Post
You aren't giving us much information other than 0% financing and able to borrow more than the value of the car.
For starters, is the loan through a bank or through the brand's financing department.
AT 0% interest, how long is the loan good for and is there any hidden fees?
Generally speaking, there's no such thing as a free lunch. If it is too good to be true, it generally is.
Why are they loaning you money for free when that money can be used elsewhere to try to generate revenue, possibly by moving one of their cars?
I know as much as I have provided. We weren't interested so didn't look into the details

But I would think that the loan would be through their own financing, for whatever length of time the financing on the new vehicle was going to last. And my guess is they are using this 'promotion' to try and upgrade us to move a new vehicle. Once again the only thing that i hadnt heard of in this scenario was dealers offering to attach extra cash to the loan at 0%
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Old 03-14-2016, 10:51 AM   #5307
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I know as much as I have provided. We weren't interested so didn't look into the details

But I would think that the loan would be through their own financing, for whatever length of time the financing on the new vehicle was going to last. And my guess is they are using this 'promotion' to try and upgrade us to move a new vehicle. Once again the only thing that i hadnt heard of in this scenario was dealers offering to attach extra cash to the loan at 0%
So in other words, it is just a car sales guy trying to drum up more business as others have said.
While you may not have heard about the extra cash, there is probably a limit like $1K or $1500 max as a sales gimmick to sell another car.

It's not like they are loaning you $1M at 0% interest.
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Old 03-14-2016, 11:09 AM   #5308
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The rise in household debt is alarming to be sure. The Canadian economy itself lacks diversity, but as long as you remain in Canada, you have Canadian equities (we all do in some form or another - i.e. CPP), and are employed here, you're exposed like the rest of us.

On the other hand, you could live off the grid so to speak. In my extended circle of acquaintances, I know a successful entrepreneur who builds and sells companies. He and his partner are floaters - they live where they want and are pretty carefree. I guess when you're a cancer survivor, as one of them is, it gives you pause and you realize that it's all bullshit in the end.
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Old 03-16-2016, 05:08 AM   #5309
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you know how you can spot a financier? this is a good example. here is someone who won't admit they have been exceedingly wrong on Vancouver real estate, someone who always over-analyze everything from society, politics to economics, and also someone who is verbose and pretend they know a lot of stuffs without giving a concrete date when his prognostication will come to fruition.

i don't doubt the sincerity of your opinions (however wrong they are), but i think your arrogance and overconfidence in your "investment" ability got the better of you.
wrong on vancouver real estate? what defines wrong - going up until it goes down? not being able to give you an exact date when people's emotions change (followed by action) - NO ONE can time anything. those that 'can' get lucky, they cannot over the long term, this is fact.

you may call me wrong as i have not been buying Vancouver real estate in the recent time, but i call myself right as i won't expose myself to this kind of risk, and have been buying many other assets that have grown in value without the risk (or with the fundamentals to support any downside risk).

It's not like i'm sitting on cash, i would argue that my risk adjusted returns are way above those of a 1 house vancouver 'investment' in the short term due to the risk side, i can absolutely guarantee you that my rent/diversified investment strategy will factually beat that of a one or two (or 5) house vancouver investment 'strategy'.

the reason i know this is down to history. Real estate is a hedge against inflation, good job, you get on average 0-1% real returns on capital appreciation (and in Vancouver negative cash flow) vs. S&P500 about 7% real return with reinvested dividends.

yes, i am a finance guy. finance guys understand risk. they assess risk and reward, they allocate capital accordingly. they do not expose themselves to risk when fundamentals do not provide downside protection.

am i wrong? in your eyes, yes, in my eyes (and based on my assets / retirement plan) - NO FUCKING WAY. I think most would agree that one would have to be incredibly bold to buy real estate in vancouver knowing what we know. but most that buy don't know shit, they buy bc they have a short term memory.

rather than say 'he's wrong, he's wrong, it's not crashed yet' - why don't you appreciate that finance guys generally know a thing or two about finance, much as a medical doctor knows about medicine.
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Old 03-16-2016, 05:12 AM   #5310
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4444 is right for the most part. Price coming down to affordable level for the Joes perhaps a speculation but he is spot on on investment. Risk management is number one principle of investment and putting all your egg in an illiquid asset class is poor risk managment. And size matters.

Market is cyclical. Price will correct but from what level and when is a mystery. Again, when there is a lot of excitement is when to be cautious as it usually mark the "euphoria" state of the market, where the risk is the highest.
you hit the nail on the head - prices coming down is an unknown, exactly as prices going up is an unknown. prices going down are supported by affordability, prices going up are supported by eurphoria.

all we know is this: when prices go up unnaturally, they overshoot.
when prices come down in a panic, they overshoot.

when this happens, to what extent, no one knows, but it's going to be a fucked up ride (as it is right now) - you only win if you get off the ride with profits in your pockets.

bulls make money, bears make money, pigs get slaughtered. lots of pigs in vancouver...
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Old 03-16-2016, 05:16 AM   #5311
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Risk management sounds nice but in truth it is very irresponsible advice because you are telling people to rent and get shut out of the dream of owning a property for the foreseeable future.
it is irresponsible to make people understand and act based on risk and reward?

most people do not have the foggiest idea about finance or risk, they buy a house with borrowed money (that must be repaid at par) today expecting prices to rise forever... they end up financially fucked over when prices stall or fall slightly

but they live the dream of owning real estate so it's ok... or so says you

based on recent migration trends, looks like the vancouver dream for millennials is to leave vancouver
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Old 03-16-2016, 05:32 AM   #5312
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Global recession does NOT only destroy Vancouver real estate, it also destroy all other asset classes like stocks and commodities. What is true though is that a house is the best form of hedge against inflation. Do you really think central banks will let us come to a financial ruin again after what they witnessed happened if they don't help Fannie, Freddie, AIG, and Lehman Brothers?
you have cherry picked a group of companies that got bailed out or went under - but that's ok, because you should hold no more than 1-2% of your portfolio in companies like these. but real estate is a 1 asset investment, whilst it may not go to zero, it doesn't need to to ruin people, just needs to go to less than your mortgage amount to make it a waste of time (assuming renting is cheaper - if you can afford to pay the mortgage, not the end of the world, but from an investment standpoint, now sucks balls - negative equity)

you are right, though, a global recession would hit equities/commodities/real estate. if you need money that is in equities, you should have already cashed out (5 year rule - if you need money within 5 years, you sell out of equities and put into fixed incomes / guaranteed principle investments).

here's the difference. if you have only 1 house and no other assets, and say real estate and equities both drop by 30%, you have a mortgage, at say, level of 80-95, but your house is now worth 70 (simplified assumptions). if prices revert to mean increases (0-1% above inflation), within 5 years, your house is worth about 73 or so. you will lose that house as your mortgage will be called in. (if you have loads of equity, it's a non issue - but as i'm about to prove, that's the exact situation for diversified, debt free, equity / fixed income investors = lower risk)

this is all assuming you have your job still, as, you know, global recession and all. no job = no mortgage payments = you're on your arse on the streets. no house anymore. living the dream, right?!

if you are invested in diversified portfolios of equities, fixed income, real estate, etc. some will go down (equities / real estate), but some will go up as institutional investors and some retail investors move towards safety. net you're down less than 30% (assuming equities / real estate both fall 30%).

but given you're an equities investing person, and you're investing every month / paycheque, you're a winner, you are now buying on sale! 30% off! you buy way more for that fixed amount of monthly investment allocation you have!

what happened in the years after the financial crisis? equities fucking rocked it, you'd be buying super cheap for a couple of years, and then you'd be fully in the black again.

worst case scenario, you lose your job, go on welfare, sell portions of your lower value equities (you have no debt against these investments, only equity, though 30% less now) to survive, and wait until you get rehired to start reinvesting.

you can look up all your life, but sadly, things don't go up forever - in fact, they NEVER do. down times will come, that i can promise you - you deny that, and you're crazier than CiC
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Old 03-16-2016, 07:11 AM   #5313
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Millennials Flee Vancouver for More Affordable Cities - Bloomberg Business
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Old 03-16-2016, 08:02 AM   #5314
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the main driver of real estate sales is emotion. if you're trying to invest money emotion is a distraction.
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Old 03-16-2016, 08:54 AM   #5315
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I think that report saying only 1 out of 8 condos I'm Vancouver are unihabjited was a huge blow to the affordable housing advocates.

I'm sure they all Expectsd it to be 1/4 or more. 1 out of 8 is nothin and probably the norm for a lot of big cities.
It seems like the study was a bit flawed. Wasn't it essentially based on if some sort of power source was used in the home at any point in the past year? I'm sure a lot of these "uninhabited homes" have probably had a maid, a family member or an owner walk in there in the past year.
It doesn't mean someone lives there.
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Old 03-16-2016, 09:02 AM   #5316
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I'm betting it's based on people claiming it is their primary residence for tax reasons in Canada. For the foreigners who don't live here... That's a lot of empty haabited homes.


If your correct, that's even worse!
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Old 03-16-2016, 09:11 AM   #5317
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you know how you can spot a financier? this is a good example. here is someone who won't admit they have been exceedingly wrong on Vancouver real estate, someone who always over-analyze everything from society, politics to economics, and also someone who is verbose and pretend they know a lot of stuffs without giving a concrete date when his prognostication will come to fruition.

i don't doubt the sincerity of your opinions (however wrong they are), but i think your arrogance and overconfidence in your "investment" ability got the better of you.
I agree 100% Carl Johnson, 4444's arrogance and over confidence has gotten the better of him and he can't admit it......he is blinded by his arrogance, I luv it! haha! I can't wait for his over compensating response
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Old 03-16-2016, 09:38 AM   #5318
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It's crazy how Burnaby Condo Property Taxes are almost x3 the amount of Vancouver Condos
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Old 03-16-2016, 09:38 AM   #5319
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Although I'm not employed in the finance industry, I understand what 4444 is driving at. He's right about markets and diversity in one's portfolio.

But, where I think he is misguided is that the real estate market in Vancouver has truly become detached from fundamentals. He has argued that the fundamentals are never wrong because they're inherently fundamentals. This market, at the high end, is driven by investors who have a different perspective than the typical rational, Western ROI-chasing investor. This in turn has driven wealthy people, or their children, who have been displaced (whether financially or culturally) to other areas of Metro Vancouver. Others, such as first generation immigrants, who paid off their houses long before the boom started have borrowed against the value of their homes and funded acquisitions of other housing for themselves or for their children.

If housing in this market crashes, say to the tune of 50%, the people who borrowed against their homes would still be okay because their homes were likely paid off long ago. They would still be able to service the interest payments on their home equity loans from CPP, OAS, and any pensions they have (the baby boomer generation has benefited from pensions that were much more common). They can defer payment on property taxes indefinitely and even if they find themselves in a position where they have to sell, they will likely be okay as the sale, even in a fire sale environment, will cover any loans remaining on the property. Or they will die knowing that the estate sale will take care of any loans on their property.
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Old 03-16-2016, 09:44 AM   #5320
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I'm betting it's based on people claiming it is their primary residence for tax reasons in Canada. For the foreigners who don't live here... That's a lot of empty haabited homes.


If your correct, that's even worse!
I could totally be wrong on what I said, but I remember hearing it as being the source, or being a prospective source on the matter.
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Old 03-16-2016, 10:05 AM   #5321
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Although I'm not employed in the finance industry, I understand what 4444 is driving at. He's right about markets and diversity in one's portfolio.

But, where I think he is misguided is that the real estate market in Vancouver has truly become detached from fundamentals. He has argued that the fundamentals are never wrong because they're inherently fundamentals. This market, at the high end, is driven by investors who have a different perspective than the typical rational, Western ROI-chasing investor. This in turn has driven wealthy people, or their children, who have been displaced (whether financially or culturally) to other areas of Metro Vancouver. Others, such as first generation immigrants, who paid off their houses long before the boom started have borrowed against the value of their homes and funded acquisitions of other housing for themselves or for their children.

If housing in this market crashes, say to the tune of 50%, the people who borrowed against their homes would still be okay because their homes were likely paid off long ago. They would still be able to service the interest payments on their home equity loans from CPP, OAS, and any pensions they have (the baby boomer generation has benefited from pensions that were much more common). They can defer payment on property taxes indefinitely and even if they find themselves in a position where they have to sell, they will likely be okay as the sale, even in a fire sale environment, will cover any loans remaining on the property. Or they will die knowing that the estate sale will take care of any loans on their property.
I don't doubt 4444's intelligence or for the most part his good advice. He cannot fathom that someone might have a different POV and might be right. He could respond like a normal person with some respect, but he chooses to stand on his soapbox and tell everyone he is right and everyone is wrong. I am not sure what he is overcompensating for , but it is fascinating. Just cause someone is in finance or is a lawyer, means nothing, just because you are a chef, doesn't automatically make you a good chef.
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Old 03-16-2016, 10:14 AM   #5322
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If housing in this market crashes, say to the tune of 50%, the people who borrowed against their homes would still be okay because their homes were likely paid off long ago. They would still be able to service the interest payments on their home equity loans from CPP, OAS, and any pensions they have (the baby boomer generation has benefited from pensions that were much more common). They can defer payment on property taxes indefinitely and even if they find themselves in a position where they have to sell, they will likely be okay as the sale, even in a fire sale environment, will cover any loans remaining on the property. Or they will die knowing that the estate sale will take care of any loans on their property.
Here's hoping this happens and soon
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Old 03-16-2016, 10:20 AM   #5323
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I don't doubt 4444's intelligence or for the most part his good advice. He cannot fathom that someone might have a different POV and might be right. He could respond like a normal person with some respect, but he chooses to stand on his soapbox and tell everyone he is right and everyone is wrong. I am not sure what he is overcompensating for , but it is fascinating. Just cause someone is in finance or is a lawyer, means nothing, just because you are a chef, doesn't automatically make you a good chef.
It's an internet forum where ego often takes over. I will be the first person to admit behaving in a disrespectful way at times.

Perhaps it's the result of the type of environment/industry he works in where you have very smart people arguing over the best course of action for their clients. I'm sure it's a high-pressure and high stakes environment. On a personal note, I never became a lawyer not because I wouldn't have been able to put in the time, but because I just couldn't see myself in that whole billable hour, anal retentive environment in which you're fighting tooth and nail for every last inch for your clients. But, I work with some damn good lawyers though and they're great people on a personal level.

To 4444: I'm sure you're a great guy in person. Respect man.
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Old 03-16-2016, 10:23 AM   #5324
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Although I'm not employed in the finance industry, I understand what 4444 is driving at. He's right about markets and diversity in one's portfolio.

But, where I think he is misguided is that the real estate market in Vancouver has truly become detached from fundamentals. He has argued that the fundamentals are never wrong because they're inherently fundamentals. This market, at the high end, is driven by investors who have a different perspective than the typical rational, Western ROI-chasing investor. This in turn has driven wealthy people, or their children, who have been displaced (whether financially or culturally) to other areas of Metro Vancouver. Others, such as first generation immigrants, who paid off their houses long before the boom started have borrowed against the value of their homes and funded acquisitions of other housing for themselves or for their children.

If housing in this market crashes, say to the tune of 50%, the people who borrowed against their homes would still be okay because their homes were likely paid off long ago. They would still be able to service the interest payments on their home equity loans from CPP, OAS, and any pensions they have (the baby boomer generation has benefited from pensions that were much more common). They can defer payment on property taxes indefinitely and even if they find themselves in a position where they have to sell, they will likely be okay as the sale, even in a fire sale environment, will cover any loans remaining on the property. Or they will die knowing that the estate sale will take care of any loans on their property.
it is a fair point, absolutely there is a large portion of the market that is driven by international money (not just vancouver).

the reason I suggest this will not last forever is that at some point the bottom of society will fall out.

If the current rates of increases continue, driven by only rich foreigners (and select locals) buying (which is the hypothesis thrown around here, as otherwise it makes no financial sense to buy), it will result in people leaving (we see this happening now in the millennial segment). If this effect gets so large, the fundamentals of what make a city good will change.

You also have to admit that there is no way this situation is sustainable. Canada cannot keep on taking in rich foreigners, give them access to healthcare and cheap/good education when the tax base is being eroded (these foreigners are not paying income tax).

Governmental change will come. Societal change will come. Crazy house price increases are not good for society (there are papers written about this).

Timing of these are unknown. But, hey, if not, fucking awesome for those that own... i've made money on housing all over the world, i've won on investments, i've lost on others, but the obsession in real estate in vancouver is just stupid. Whenever I return to vancouver to visit family, old friends, people on the street, it's all they talk about. it's boring. (and most are complaining they can't afford - society gets hurt)
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Old 03-16-2016, 10:25 AM   #5325
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Originally Posted by Z3guy View Post
I don't doubt 4444's intelligence or for the most part his good advice. He cannot fathom that someone might have a different POV and might be right. He could respond like a normal person with some respect, but he chooses to stand on his soapbox and tell everyone he is right and everyone is wrong. I am not sure what he is overcompensating for , but it is fascinating. Just cause someone is in finance or is a lawyer, means nothing, just because you are a chef, doesn't automatically make you a good chef.
it's a fucking internet forum. you think i'd be this brash in real life?

and compensating? look at your signature... same could be said for you, trying to show off material things - useless
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