If you go to apply for a mortgage, you will suddenly encounter the REAL hunt for money. My sister just bought a house and to get the mortgage she had to explain every deposit and cash withdrawal in her account going back 5 years. My mother had simply written her a check for $400 to reimburse her for picking up some medicine. They wanted her to explain why my mother gave her $400.

Another friend who lived with a girlfriend for 5 years and shared an apartment encountered the full fury of the government’s hunt for spare change. His girlfriend had written him checks for half the rent for 5 years. Every one of those checks had to be explained before they would get a mortgage to buy a home together.

This is completely illegal, yet banks are complying. This is all under the pretense of TERRORISM whereby they have to know where every penny goes. This is not applying a new law with notice that from this date forward you have to keep track of everything you do with anyone else as in East Germany Stasi, this is being applied retroactively. The banks then report that info to the IRS and if you lie somewhere they will convert that to perjury and threaten you with 5 years in jail. My sister would withdraw $2,000 in cash every few months for my mother for incidental purchases. Every one of those cash withdrawals had to be explained. This is between family member – there is no pretense of TERRORISM. We are watching all our privacy and right vanish before our eyes.

It is no longer good enough that you pay your taxes. Now they want to know to whom you are giving any money right down to $50. As a matter of law, if I pay a lawyer for work, I must issue a 1099 to document I pay him any fees. They are tracing every dime.

This sort of red tape will come into play seriously capping real estate in the housing market. We should expect prices to peak out in general for this asset class is being hunted. It may be that the high end holds up better. But the low end that needs a mortgage to transact, will find it increasingly more difficult as the economy turns down, rates move higher, and banks back away from long-term loans.

Cash is rushing into the short-end. The long-end is starting to falter. This should be the same for most real estate markets. This is a 26 year high in Switzerland as well and the rush for condos in Toronto and NYC should top out on this wave where prices depend upon mortgages. Expect the core real estate to peak out with this wave that requires mortgages. This type of unconstitutional tracking of money will eventually discourage people from getting mortgages and as buyers are discouraged in the USA, they will move elsewhere. Caution is advisable.

…more from Martin:

The End of Bonds? Look Out Below 2015.75

Summary

• A wave of technology and innovation is fundamentally changing the way that building owners and other real estate investors are thinking about the role of electricity in real estate investments.
• New energy companies are emerging. The current environment, with persistently low interest rates, has made the use of money extraordinarily inexpensive, and investors have been willing to enter parts of these new energy markets at a scale and pace that has surprised many as they search for new sources of yield.
• The need for investment to support the energy transition that has just begun is immense – this transition will require the largest deployment of capital in human history, so there is plenty of room for new participants, especially investors that are filling in underserved portions of the market.

….read more HERE

The chart above shows the average detached housing prices for Vancouver, Calgary, Edmonton, Toronto*, Ottawa* and Montréal* (the six Canadian cities with over a million people) as well as the average of the sum of Vancouver, Calgary and Toronto condo (apartment) prices on the left axis. On the right axis is the seasonally adjusted annualized rate (SAAR) of MLS® Residential Sales across Canada.

Check out Brian Ripley’s Plunge-o-meter HERE (The Plunge-O-Meter tracks the dollar and percentage losses from the peak and projects when prices might find support.)

 May 2015 Canada’s big city metro SFD prices all caught a bid and only Calgary houses did not set new historic highs. Apparently it’s all about the land that real estate sits on; big money is willing to pay a premium for sitting on it.

Price gains were accomplished on a zoom higher in sales volume of the Canadian national MLS residential annualized housing sales data. Trophy hunters are looking for well located SFD properties in hot markets and the hoi polloi want in before they are priced out. 

Can the “posted retail” 5 year fixed rate mortgage low of 4.64% (sub-3% on the street) drive the hunger games into overtime in 2015? Or is the commodity crash signalling an upcoming major correction for Canadian housing? Your opinion is welcome.

Mattress money has gushed into condos with no respect for fundamentals or plan for contingencies that may be required if Pit of Gloom II develops and one must write off capital gains and or rely on employment earnings to subsidize negative yields.

Canadian real estate hasn’t reached its full potential, according to one real estate mogul’s advisor.

“Canada is a vibrant economy and some people ought to step in and take advantage of it” said George Ross, executive vice president and senior counsel to the Trump Organization. “I think it’s under-utilized – not over-utilized.”

Ross has been advising Trump since the 1970s and has worked for Trump since 1996. He is also featured in “The Apprentice.”

According to Ross, investors should play the long-game when it comes to Canadian real estate. “I don’t think the buy-sell or the short sale is the answer,” Ross told BNN.

“[Real estate investors] are attracted because of the money, but they don’t talk about how long it takes to get the money and they don’t take about the fact you could be in there and not recover what you invested.”

It’s an interesting stance, considering CMHC’s recently released data is calling for fairly stagnant growth in terms of starts and prices over the next two years.

Housing starts are expected to decline by 4.1 per cent – and range between 166,540 and 188,580 units — in 2015. Prices, meanwhile, are expected to increase by 3.4 per cent, according to the Crown Corporation’s most recent housing forecast.

As for the near future, housing starts are expected to range between 162,840 and 190,830 in 2016.

The average price is expected to fall between $402,139 and $439,586 this year and between $398,191 and $457,200 in 2016.

“The gradual slowdown in the rate of price growth is explained by the expected change in the composition of MLS sales toward more moderately priced homes,” the Crown Corporation said in its official release.
 

Investment Hot Spots:
Lansdowne, Perth, Lotbinière, Bell Island, Garlands Crossing

Looking to find out more about a Canadian neighbourhoods to invest in? Below are the Top 10 neighbourhoods in Alberta. With a median listing price of $5,868,240, Lacombe County is Canada’s 1st most expensive when ordered by median listing price. For all Albertan neighbourhoods go HERE (click on City or neighbourhood for all details)

For the Top 10 Neighbourhoods, indeed virtually every single neighbourhood in every province and territory in Canada start HERE