Lack of jobs & affordable house, pushing some to leave

[Static]

40% is more realistic. The real estate prices here have never moved in tandem with the local economy and likely never will. All rational economics go out the window when you have a desirable location with a weak economy. It does create a serious problem for affordable housing and a situation that needs some creative thinking to resolve.

Population Age Distribution
Okanagan-Similkameen Regional District
Age Grouping (years) Male Female Total
0 – 14 5,315 5,390 10,695
15 – 24 4,185 3,965 8,155
25 – 44 7,060 7,940 15,000
45 – 54 5,985 6,620 12,600
55 – 64 5,790 6,355 12,145
65 + 9,830 11,040 20,870
Total 38,165 41,310 79,475


looking like 60% would be more accurate....

[Glacier]

Aren't houses cheap around Hedley and Keremeos?

[Static]

40% is more realistic. The real estate prices here have never moved in tandem with the local economy and likely never will. All rational economics go out the window when you have a desirable location with a weak economy. It does create a serious problem for affordable housing and a situation that needs some creative thinking to resolve.

Population Age Distribution
Okanagan-Similkameen Regional District
Age Grouping (years) Male Female Total
0 – 14 5,315 5,390 10,695
15 – 24 4,185 3,965 8,155
25 – 44 7,060 7,940 15,000
45 – 54 5,985 6,620 12,600
55 – 64 5,790 6,355 12,145
65 + 9,830 11,040 20,870
Total 38,165 41,310 79,475


looking like 60% would be more accurate....

Thanks for the numbers. Taking 24-65 as working class it is actually split right down the middle at 50%. It really dosen't change anything I said however.

Do people not work between the ages of 19 and 24?

[twobits]

40% is more realistic. The real estate prices here have never moved in tandem with the local economy and likely never will. All rational economics go out the window when you have a desirable location with a weak economy. It does create a serious problem for affordable housing and a situation that needs some creative thinking to resolve.

Population Age Distribution
Okanagan-Similkameen Regional District
Age Grouping (years) Male Female Total
0 – 14 5,315 5,390 10,695
15 – 24 4,185 3,965 8,155
25 – 44 7,060 7,940 15,000
45 – 54 5,985 6,620 12,600
55 – 64 5,790 6,355 12,145
65 + 9,830 11,040 20,870
Total 38,165 41,310 79,475


looking like 60% would be more accurate....

Thanks for the numbers. Taking 24-65 as working class it is actually split right down the middle at 50%. It really dosen't change anything I said however.

Do people not work between the ages of 19 and 24?

Sure, some do and some are students. If I give you 19-24 will you give me 60-65. Silly thing to try and proove. More importantly, how does it support your view or detract from mine. If out of the entire exchange, if that is the only flaw you can find............it still dosen't change a dam thing.

[Static]

40% is more realistic. The real estate prices here have never moved in tandem with the local economy and likely never will. All rational economics go out the window when you have a desirable location with a weak economy. It does create a serious problem for affordable housing and a situation that needs some creative thinking to resolve.

Population Age Distribution
Okanagan-Similkameen Regional District
Age Grouping (years) Male Female Total
0 – 14 5,315 5,390 10,695
15 – 24 4,185 3,965 8,155
25 – 44 7,060 7,940 15,000
45 – 54 5,985 6,620 12,600
55 – 64 5,790 6,355 12,145
65 + 9,830 11,040 20,870
Total 38,165 41,310 79,475


looking like 60% would be more accurate....

Thanks for the numbers. Taking 24-65 as working class it is actually split right down the middle at 50%. It really dosen't change anything I said however.

Do people not work between the ages of 19 and 24?

Sure, some do and some are students. If I give you 19-24 will you give me 60-65. Silly thing to try and proove. More importantly, how does it support your view or detract from mine. If out of the entire exchange, if that is the only flaw you can find............it still dosen't change a dam thing.

I was including the 60-65. That is what makes the 60% of the Okanagan population employed, it most likely higher seeing the number of retirees that work part time. It does change a great deal in the sense it shines light on your flawed and dillusional veiw on Okanagan RE. It is the local wages that drives this market, not the supposed busloads of retirees, Indians, and Chinese -foreigners-flocking here as you beleive. Only 40% work..come back to earth.

[twobits]

40% is more realistic. The real estate prices here have never moved in tandem with the local economy and likely never will. All rational economics go out the window when you have a desirable location with a weak economy. It does create a serious problem for affordable housing and a situation that needs some creative thinking to resolve.

Population Age Distribution
Okanagan-Similkameen Regional District
Age Grouping (years) Male Female Total
0 – 14 5,315 5,390 10,695
15 – 24 4,185 3,965 8,155
25 – 44 7,060 7,940 15,000
45 – 54 5,985 6,620 12,600
55 – 64 5,790 6,355 12,145
65 + 9,830 11,040 20,870
Total 38,165 41,310 79,475


looking like 60% would be more accurate....

Thanks for the numbers. Taking 24-65 as working class it is actually split right down the middle at 50%. It really dosen't change anything I said however.

Do people not work between the ages of 19 and 24?

Sure, some do and some are students. If I give you 19-24 will you give me 60-65. Silly thing to try and proove. More importantly, how does it support your view or detract from mine. If out of the entire exchange, if that is the only flaw you can find............it still dosen't change a dam thing.

I was including the 60-65. That is what makes the 60% of the Okanagan population employed, it most likely higher seeing the number of retirees that work part time. It does change a great deal in the sense it shines light on your flawed and dillusional veiw on Okanagan RE. It is the local wages that drives this market, not the supposed busloads of retirees, Indians, and Chinese -foreigners-flocking here as you beleive. Only 40% work..come back to earth.

Your response/rebuttal says much. No need for me to comment.

[Static]

Your response/rebuttal says much. No need for me to comment.

Thank-you, you have no reason to comment because you have no valid point on the topic other than REALTOR instilled beleifs.

[Static]

Canada is 'a purely random success story': Shiller
Feb 09, 2010 Janet Whitman Financial Post

NEW YORK — Canada is being feted in international circles after coming through the financial crisis relatively unscathed, but the accolades may be unwarranted.

That’s the conclusion of a leading U.S. economist who’s crunched the numbers and determined two factors that may take Canada down a notch or two: the housing market looks due for a U.S.-style drop; and, without oil, the country would be in trouble.

Robert Shiller, the Yale professor who correctly predicted the 1987 stock market collapse and the recent U.S. housing market meltdown, said Canada’s robust financial health compared to other nations is largely due to a random run-up in oil prices in the midst of the global financial crisis.

“It’s a major export for Canada and it went to US$140 a barrel in 2008, right when Canada needed it,” Prof. Shiller said in an interview Tuesday.

Canada’s economic output fell roughly 4.2% from its peak in 2007 to its trough in 2009 — even with the oil price surge, while the U.S. saw a near-identical decline.

“It seems that if the country didn’t have that boost from oil, it would have done worse than the United States,” Prof. Shiller said.

While many economists, market observers and Canadian politicians trumpeting Canada’s success like to highlight the country’s differences from the United States, Prof. Shiller said that historical economic data show they are very much alike, with both economies heavily influenced by a similar human psychology, a theme he explored in a 2009 book he co-authored called “Animal Spirits.”

“Our countries are like two peas in a pod,” he said. “A lot of the differences are random, like the oil shock.”

If the historical statistics serve as a guide, Canada looks to be headed for a big drop in home prices, although any decline probably won’t be as pronounced as the U.S. housing bust, he said.

U.S. home prices adjusted for inflation surged 79% between 1990 and their peak in 2005. Canada’s gained about 45% over the same period and have continued marching higher, up to about a 50% gain currently, said Prof Shiller.

“I’m a little worried about the Canadian housing market. Fifty per cent seems like a lot in 20 years,” he said. “I suspect the same forces are in operation in Canada, although maybe somewhat attenuated because mortgage institutions are more responsible there.”

Prof. Shiller, who helped develop the widely followed Standard & Poor’s Case-Shiller for the U.S. housing market, picked apart the Canadian economic data in preparation for his keynote presentation last week at a Manhattan conference promoting investment opportunities in Canada.

After Canada’s International Trade Minister Peter Van Loan opened the conference with remarks touting the country’s financial might, Prof. Shiller called Canada “a purely random success story.”

“I’m not a salesperson, so I gave Canada a bland view,” he said. “It’s the same thing on both sides of the border.”

Calgary and Vancouver appear to be the biggest possible housing bubbles in Canada, he said.

“Vancouver feels bubbly like San Francisco,” he said. “There’s a West Coast culture that extends from Seattle down to San Diego.”

He advises Calgary homeowners worried about their home values to hedge their bets by shorting oil. “If oil prices go down, your home prices is going to go down with it,” he said.

Prof. Shiller said he owns a house near Yale in New Haven, Conn., and a summer home, both for nostalgic reasons, not as investments, and he believes it makes more sense for most people to rent and put the savings in a diversified portfolio. “People should think of buying a home as risky. They should maybe put some money in housing, but invest all over...and maybe take part in the Chinese Miracle.”

Financial Post

[Static]

The Globe and Mail
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B.C. households most at risk to debt shocks
Tavia Grant
Globe and Mail Update
Published Wednesday, Feb. 09, 2011 9:27AM EST

Canadians are struggling with record debt loads - though not every province is equally at risk.

Households in British Columbia are most vulnerable to an unexpected economic shock like falling house prices, swift interest rate hikes or a surging jobless rate, a paper by Toronto-Dominion Bank said Wednesday.

Those in Alberta and Ontario are the next most at risk, with Alberta's vulnerability rising at the fastest pace in the country, the bank's report said. Households in Manitoba, by comparison, are cushioned with relatively low debt loads, it noted.

Canadians' debt-to-income levels have swelled to a record in recent months, surpassing levels in the U.S., prompting warnings from the Bank of Canada that households need to start reigning in debt. The worry is that, as interest rates start to rise later this year, some households will be under water. Several major banks already hiked their mortgage rates this week.

“With higher interest rates on the horizon set to boost the cost of servicing debt, this upward trend in vulnerability is almost certain to continue over the next one-to-two years,” said TD economists Craig Alexander, Derek Burleton and Diana Petramala.

Their measure of household vulnerability is not meant to predict the future. But it is intended to show which parts of Canada are most “prone in the event of an economic surprise,” they said.

If Canadians don't slow the rate at which they're piling on debt, the risks of a consumer “adjustment” will only intensify, they added.

Debt loads are higher in B.C. for a number of reasons, including higher homeownership costs. The province is the only one in Canada where the average savings rate is negative. Up to one in ten households in B.C. would be in financial stress if interest rates rise, it said.

TD expects the Bank of Canada's overnight lending rate to hit 3 per cent by the end of 2012, from 1 per cent currently.

The measure they created captures debt loads at the provincial level by tracking trends like the personal savings rate and the ratio of existing home prices to income.

Among TD's conclusions:

* Vulnerability has been growing from coast to coast over the past two years.

* Soaring household debt-to-income and home-price-to-income ratios are the main reasons for that.

* Debt-service ratios, or the cost of servicing all that debt, are still in the “comfortable” range.

* All regions will see a “substantial” increase in vulnerability in the next few years.

* A crisis isn't in store for any one region. And the pace of household debt growth should slow.

Still, “the cooler trends expected in both borrowing and spending will need to be sustained for at least a few years before the warning lights stop flashing red,” the economists said.

[twobits]

Nothing in those articles I didn't touch on. And I certainly don't see "slaughter" written anywhere.

[twobits]

B.C. most financially vulnerable province: TD
Last Updated: Wednesday, February 9, 2011 | 11:09 AM PT Comments20Recommend2CBC News
Canadians need to tackle their debt loads, but people from British Columbia are the most financially vulnerable of all, TD Bank warned Wednesday.

The bank issued a report that assessed the comparative vulnerability of household balance sheets in all regions of the country to unexpected stresses like higher interest rates on debt or a sudden job loss.

"[The] vulnerability index is not a predictor of the future," TD economists Craig Alexander, Derek Burleton and Diana Petramala said in the report. "[But] based on our analysis, we find that households in British Columbia, Alberta, Ontario and Saskatchewan are the most vulnerable," they said.

The bank compiles its index by looking at factors such as the personal savings rate, the ratio of existing home prices to income and the debt service ratio across the country.

The bank places its baseline vulnerability at one, for the Canadian average. This year British Columbia was given a score of 1.24, meaning the province's average is 24 per cent more financially vulnerable than the national average.

The bank cited higher home ownership costs in the province for the higher score. The average savings rate is negative in B.C., the only Canadian province in which that's the case. Up to one in ten households in B.C. would be in financial stress if interest rates rise, the report suggested.

Alberta catching up to B.C.
Nationally, the debt-to-income ratio for the average Canadian is 127 per cent. In B.C., it's 160 per cent, the bank found. The province has been the most financially vulnerable, according to the bank's terms, since it began to compile the data in 1999.

"Risks related to household finances have been rising broadly across all regions over the past few years, as households have responded to extremely favourable borrowing conditions," the bank said. "With higher interest rates on the horizon set to boost the cost of servicing debt, this upward trend in vulnerability is almost certain to continue over the next 1-2 years."

A number of major Canadian banks hiked their benchmark five-year fixed-rate mortgage rates this week.

Alberta was in second place with a score of 1.11. While the level of the index is not significantly higher than third place Ontario, its rate of increase since 2007 has been unrivalled across the country, pulling the province closer to first place British Columbia, the report said.

Manitoba had the lowest score, at 0.75. It is the only province to have a lower score today than in 2006, the bank noted.

"Despite the picture of growing vulnerability from coast to coast over the past few years, we do not believe that there is a household financial crisis in the making in any region," the bank concluded.

Don't see any "slaughter" here either.
Bolding by me. Twobits

[twobits]

And another opinion out today. Again, no "slaughter" in sight. I'll quit with the boring copy/paste now.

OTTAWA — The Royal Bank of Canada became the third major Canadian bank to hike its five-year mortgage rate Tuesday, and Finance Minister Jim Flaherty is warning of further increases in the months ahead.

RBC joined TD Bank and CIBC in raising its posted rate for a five-year closed mortgage by one quarter of a percentage point to 5.44 per cent. The bank also raised a number of its other posted and special mortgage rates Tuesday.

Finance Minister Jim Flaherty said the hikes are "exactly what we expected."

Speaking outside the House of Commons Tuesday, Flaherty told reporters that with lending rates at historic lows, there is nowhere for the cost of borrowing to go but up.

"We're likely to see higher interest rates as we go forward because interest rates are still very low," Flaherty said.

The banks pin the hikes on a rebound in the stock market that has led to rising government bond yields, signs the economy is continuing its slow but sure recovery from the recession.

"It's gaining some traction and as the economy recovers, interest rates begin that process of returning to more normal levels," Derek Burleton, TD Bank deputy chief economist told CTV News.

While experts have predicted a cooling in the housing market after tighter mortgage rules come into effect in mid-March, a new report predicts that growing consumer confidence may offset the expected negative effects of higher interest rates.

The Canadian Real Estate Association released a revised forecast Tuesday for Canadian home sales in 2011, which the agency predicts will be higher than it first predicted last year.

Its new forecast estimates that 439,000 existing homes will be sold in 2011, down 1.6 per cent from 2010 but an improvement on the nine-pet-cent decline predicted in December.

And unlike some economists, who predict that home prices will level off, or drop sharply, as rates shoot up, the CREA predicts that the average home price will rise by 1.3 per cent in 2011 to $343,000. In its earlier forecast, the agency predicted that the national average home price would fall by 1.3 per cent compared to 2010, to $326,000.

"Even though mortgage interest rates are expected to rise later this year, they will still be within short reach of current levels and remain supportive for housing market activity," said Gregory Klump, the CREA's chief economist. "Strengthening economic fundamentals will keep the housing market in balance, which will keep home prices stable."
With a report from CTV's John Vennavally-Rao



Comments are now closed for this story

Prof. Pye Chartt
said
63 47

More "bad" news, right Bubble People? ("The end is here!") While, indeed, it's fair to argue that a continued overall elevation in prices cannot be sustained, this rationale cannot be automatically linked to a price-plunge or real estate market crash. As we speak, actually, the market is leveling off, and balance is being restored. Just because prices SEEM "high" doesn't mean that they're destined to drop considerably. The demand factor, particularly in major markets such as the Greater Toronto Area (GTA) where the tide of immigration -- a profound, ongoing force seldom understood and appreciated by the doom-and-gloom crowd -- is a MAJOR driver, is still quite stable. Interest rates will increase modestly, and there certainly won't be a sudden dramatic hike to break the market at its knees. Sure, some markets in Canada got ahead of themselves, and are experiencing a material correction. So what?! This happens normally, post-recession. Just because townhomes may have depreciated in your neck of the woods doesn't mean that the Canadian real estate market is in serious jeopardy. (Such common micro-analyses are always laughable.) Cheer up, Bubble People.

[Static]

Twobits, I do not beleive it is the end of the world. I do beleive there will be a Real Estate correction that will rival the worst in our history. The quotes you have highlighted in the above articles are spoken from individuals whom have a need for the market to stay healthy. The Banker will not say house prices will correct this year because they need to write mortgages and for the President of CREA, well, I can`t beleive you would quote him, but then again it does shine more light on how little you know about the topic.

[twobits]

Twobits, I do not beleive it is the end of the world. I do beleive there will be a Real Estate correction that will rival the worst in our history. The quotes you have highlighted in the above articles are spoken from individuals whom have a need for the market to stay healthy. The Banker will not say house prices will correct this year because they need to write mortgages and for the President of CREA, well, I can`t beleive you would quote him, but then again it does shine more light on how little you know about the topic.

I am sorry to suggest that an economist of TD Bank would know as much as you and has some hidden agenda. I'm confidant in my knowledge and will stick with my asset mix. I wish you the best in you investment endeavours.

[ToddT]

I'm cheering for Static 'cause I would love to be able to afford a house in this godforsaken town.
Sincerely,
A mid-20's family man with a wife and two kids that makes a respectable wage and has lived in Penticton his whole life.