Market News

A mortgage is usually the biggest financial commitment - and greatest risk - most people are likely to assume in their lifetimes.

Buying a home is a leveraged investment, not unlike buying stocks on margin. With just 10 per cent down, a homeowner takes on debt equal to 90 per cent of the acquisition cost of the property. The immediate increase in net worth is negligible and equity grows at a glacial pace as most of the mortgage payments in the early years cover interest charges. Unlike stocks, housing is not a publicly traded asset so there is no reliable way to track daily housing prices.

However, they can be as volatile as a penny stock, as mil-lions of Americans recently discovered. And over the long term, housing performs little better than the rate of inflation. Seen in this light, both equity and debt need attention.

Homeowners know regular maintenance is required to keep a home shipshape. Out-side the irrational Vancouver real estate market, a home that is in good repair will be worth...

OECD says rate increases should happen this fall

Canada’s economy is gradually recovering and is expected to grow by 2.25 % this year and 2.5 % in 2013, according to a new report by the Organization for Economic Co-operation and Development.

Private consumption and investment will continue to be the primary drivers of growth in Canada, said the report, which was published Tuesday.

Canada’s growth will slightly outpace the OECD average, which is expected to be 1.6% in 2012 and 2.2% in 2013.

“It’s not a great outcome. A generation ago, coming out of a recession like this, we would have thought this was deplorable, but it’s not bad,” said Peter Jarrett, senior economist with the organization.

Assuming the euro zone “muddles through” its crisis, avoiding a Greek exit, Mr. Jarrett said OECD wants the Bank of Canada to start raising interest rates in the fall to avoid speedy inflation that will follow the economic growth.

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When a new condominium project sells out in one day, as it did with the Marine Gateway building in April, ever wonder who actually buys one of the units?

Real estate marketer Bob Rennie, whose company was responsible for selling the 414 apartments at the Cambie and Marine towers, gave some indication in his annual speech Thursday to the Urban Development Institute. "I think that the marketplace needs us to open the vault a bit here and share the consumer data that we received," Rennie told a crowd of more than 800 people gathered in a ballroom at the Fairmont Hotel Vancouver.

In a survey sent to 414 buyers, of which 170 responded, Rennie said 66 per cent were from Vancouver, 16 per cent from Richmond and nine per cent from Burnaby. He didn't say where the remaining eight per cent hailed from.

Of those from Vancouver, 23 per cent came from the immediate and adjacent postal codes and 37 per cent from six neighbouring postal codes.

Rennie's survey found 48 per cent of buyers spoke Mandarin...

Green players are turning out sleek, contemporary designs and changing perceptions of modular homes.

Mayur Arora is seeing something few would have expected in Vancouver’s real estate market – people walking away from deposits on houses, convinced prices will fall further.

“It happened twice in the last month. One [deposit] was $75,000 and one was a $20,000 deposit, the guys just walked away from it,” said Mr. Arora, who runs Oneflatfee.ca in Surrey, B.C. “They are going to wait it out. So they lost $75,000 and $20,000, but if the market comes down $150,000 on a $1.5-million house, that’s not uncommon.”

The average selling price of a Canadian resale home was a little less than one per cent higher in April compared to the same month a year ago.

The average home sold for $375,810 across the country in April, the Canadian Real Estate Association said Tuesday, a rise of 0.9 per cent from the same month last year.

But the volume of homes sold was significantly higher.

April home sales were 11.5 per cent higher than where they were the same month a year ealier. CREA said that's partly because sales in April 2011 were lower after buyers rushed to buy the month before ahead of new mortgage rules.