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Our own worst enemy.

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Our own worst enemy.

Postby Static » Feb 18th, 2013, 8:06 am

http://www.castanet.net/edition/news-story--906-.htm


Our own worst enemies

by Contributed - Story: 87376
Feb 15, 2013 / 5:00 am

Are Canadian real estate investors their own worst enemies?

Having just arrived home from another charity trip to Africa, I had the opportunity to do some interesting reading and reflect on what I continue to experience in developing countries like African nations.

Of late, I have been hearing and reading plenty about “staycations”, buying local produce for cooking, buying local and supporting stores in your locality, supporting the domestic car manufacturing industry etc. This is a direct reflection of what I see in smaller African communities. The desire to make a successful community, the desire to support family, the desire to see our closest loved ones succeed at what they choose to turn their hands too.

Taking a leaf out of a similar book, I called a family meeting at Christmas. We decided as a family to form a “Dragon’s Den”. We wanted to create the opportunity to add value to each other's ideas or have fun discussing them and support what we believed as a family, would succeed. I am really looking forward to our first evening meeting next week.

I recall a story a number of years ago of a friend who sold a gas company in Calgary just before the financial collapse. It was great timing for him and his shareholders and other opportunities soon came across his desk. He grasped one opportunity and went to his bank who had supported him for many years with his extremely successful gas venture. He simply wanted to reinstate a very established line of credit he had used for his ventures, however, surprisingly the bank indicated they had better opportunities lending money in the US. That was a time when our Canadian government was supporting our economy (banks!) and the money was flowing south of the border instead of into the hands of successful Canadian entrepreneurs.

Is there a lesson? Well, I think so personally, but I don’t believe we are learning much from it. As forecasts of our real estate economy continue to indicate a softening (which frankly is simply the impacts of previously overheated large urban centers) we, as investors continue to take our money south of the border.

We overlook risk, lack of financing, rising costs of travel to the destination in the future, unclear tax implications, exchange rate complications and distance from the investment, all in return for a perceived good deal. The same people participating in these investments will often avoid buying products from Asian countries, are staunch supporters of the north American car manufacturing markets and will go out of their way and pay higher prices for local food products and brag in coffee shops about how they support their local farmers, all commendable traits.

Reports I am reading still indicate an influx of Canadian money in to the US, buying foreclosed and bargain basement real estate. Places like Palm Springs are almost exclusively Canadian in the winter months.

While I understand the desire to “get a good deal” I also think we need to do some naval gazing and really think about what it will take to move our real estate markets from stability through to growth. There are equally exciting investment opportunities in Canada and BC and in particular the Kelowna area. The exciting thing is, we have amazing summers too and many of our local chefs pride themselves on supporting local farmers with their delectable menus!

The pendulum always swings but I sense a little conflict in our thought processes

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I would like for Mark Jennings-Bates to expand on the equally exciting investment oppurtunities in Kelowna when compared to places such as Florida and Palm Springs.

Furthermore, if the intent of this article is to support local investment and commerce, why did he travel to Africa for charity when there are numerous local charities that he can support?
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Re: Our own worst enemy.

Postby Static » Feb 18th, 2013, 8:09 am

P.S.

I do agree one should try to support local before anything else.
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Re: Our own worst enemy.

Postby dirtrider » Feb 18th, 2013, 8:14 am

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Re: Our own worst enemy.

Postby Static » Feb 18th, 2013, 8:48 am

I totally agree with the article Glacier.


"PS. I did not mention Fee-only planners. These are professionals that would meet with you once a year, or so, go over your portfolio, etc, and give some advice. They would charge a flat fee for this service. I think this will be a valuable service, and probably become used more, as investors go forward." :discodance:
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Re: Our own worst enemy.

Postby underscore » Feb 18th, 2013, 10:52 am

I stopped reading as soon as they said "charity trip to Africa"
cliffy1 wrote:Welcome to the asylum.
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Re: Our own worst enemy.

Postby Glacier » Feb 24th, 2013, 5:01 pm

Static wrote:I totally agree with the article Glacier.

Huh? When did I get brought into this conversation? Not that I don't also agree with the article. :spinball:
"If I have seen further than others, it is by standing upon the shoulders of giants."
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Re: Our own worst enemy.

Postby Static » Feb 24th, 2013, 6:25 pm

Sorry Glacier, I meant dirtrider.
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