What’s surprising about the current economic climate is how little it takes in terms of an increase in interest rates to drive the marginal borrower out of the housing market. Once the defaults begin and protests over mass unemployment take hold, we will long for the days of the kind of peaceful mass gathering we saw over the past three weeks in Ottawa.
But mortgage rates have been rising since August, reaching 3.92% last week, the highest since May 2019. With borrowing more expensive, applications to refinance mortgages have fallen about 45% in the last six months, according to the Mortgage Bankers Association.
Some lenders have already begun to cut back. Mortgage lender Homepoint Capital laid off nearly 10% of its workforce. Better.com, an online mortgage lender, fired around 900 workers in December during an infamous video conference call.
Its Another Housing Bubble: Rising Mortgage Rates 2022 Housing Crash Accelerates
https://m.youtube.com/watch?v=G6xDpb74AsU
When we bought our house in 1963 we paid six and half percent interest, some years later it went as high as 19% but of course our six and a half was fixed. So interest rates certainly vary. Three and a half seems like an incredible rate to me. But of course we paid $19,000 for our house which is worth close to half a million now. All things are relative I guess.
The idiot in chief rescinded the ema , schwab hardest hit
I think the coming Biden recession will be massive. We’ll look back on 2008 as a period of great economic activity. This will be Obama’s redemption arc. The recession will last until Trump is sworn in.
Ottawa mass militarization and crowd dispersion tactics will serve as a dry run for the coming chaos.
That only happens when we’re unarmed and out maned
There’s more of us then them
Canada can’t handle high interest rates. We’ll be in total recession after the first hike.
We’ll have to live with 10% inflation.
Argentina North is our destiny.
You are living with 20% right now.
Speaking of tipping points:
“I have taken the decision to carry out a special military operation. Its goal will be to defend people who for eight years are suffering persecution and genocide by the Kyiv regime. For this we will aim for demilitarization and denazification of Ukraine…as well as taking to court those who carried out multiple bloody crimes against civilians including citizens of the Russian Federation…
“Anyone who tries to interfere with us, or even more so, to create threats for our country and our people, must know that Russia’s response will be immediate and will lead you to such consequences as you have never before experienced in your history.”
Translation of a speech by Vladimir Putin just now. Its explicit goals are the removal of the globalist government in Kiev, the bringing of its leadership to justice, and its replacement with loyal Lesser Russians. Anybody standing in its way will not survive the onslaught, and will not deserve to.
The liberation of Europe has begun.
Glory to Russia.
With any luck, Pooty Poot will invade the WEF next and put Klaus Schwab on trial for crimes against humanity.
Hitler would be proud.
He repeatedly threatened his neighbors over the maltreatment of ethnic Germans, who were never maltreatment, within their borders. Seems Putin is running the same game. Foreign excursions deflect from domestic troubles.
The Ukraine has known only dictators. Does it matter if one is Russian or Ukrainian?
Putin is not a dictator, and Russia is not interested in enslaving the world.
You have him confused with Xi Jinping and China.
Putin is X KGB, and they had no love for Jews, imprisoning many on faults charges , and seeing that many were killed, stopping them from leaving the USSR,. I remember all the news about that during the “cold war”. So tell us, why do you hate Jews?
The Soviet government was anti-Semitic. All globalist governments are, more or less blatantly.
As globalism lost its grip on Russia, so did official anti-Semitism. The Jews of Lesser Russia are not the ones fleeing the Russian liberation forces.
It’s the globalists who haven’t been this upset since the liberation of Auschwitz.
Russia funds Nazis across Europe you lunatic.
They’re losing pretty quickly here. I guess the cat ladies weren’t very effective.
Nope.
The footage from globalist-occupied Lesser Russia is worth it just for the tears of impotent rage of every card-carrying globalist and keyboard “Ukrainian” patriot on earth.
They haven’t been this upset with the Russians since the liberation of Auschwitz.
I “sensed” the FAKE “equity” mortgage collapse coming in 2007. People were building and buying homes for just STUPID prices … in STUPID places … in unsustainable numbers. Everyone was leveraged beyond any reason. And something similar is happening again. Low rates have driven prices to STUPID levels. Massively inflated building materials costs are also driving prices higher. However, the high cost of building has slowed down building, so there is no oversupply. In addition, the stock market is softening, if not collapsing, and investors are turning to real estate as an alternate investment. These mega-investors and 100k smaller Real Estate investment groups are driving prices higher as competition over dwindling supply intensifies.
As the Bidinh Green Raw Deal continues to drive inflation deep into the double-digits … and the economy grinds to a halt … jobs will be lost … and foreclosures will spike … housing prices will collapse. The Wall Street vultures will pick the bones for chicken feed … then rent the homes for top prices. Wall Street wins again … and the little guy gets his head squeezed like a pimple.
For me, the tipping point in the US subprime mortgage bubble came when I read that waiters in California were giving up their acting careers to become real estate agents, and that California had added 450,000 new realtors in the past year. That’s when I concluded that the bubble was ready to pop.
If Justin”s housing market collapses, the economy is toast. Foreign money coming in to buy houses is what is floating the current economy.
Housing is just one example. There are all kinds of corporate projects financed by debt. I had the chance to see the financial model for an oil sands project once, and even a half point change in interest rates was going to be a huge deal. It makes sense. A rate increase from 3 to 3.5% in doesn’t sound like much, but it’s going to increase the amount of interest by 1/6th. (And that’s before you even consider things like financing over a longer term –> more compounding.)
Even at current near-zero rates, Ontario spends a billion dollars a month on debt interest payments. Think about what happens to their cashflow statement if the average cost of servicing that debt goes up by even 50 or 100 basis points. Most other provinces are in the same boat, and the feds are even worse off. I expect that the BoC (which, BTW, in my 30 yr career as a bond trader I spent way too much time looking at through a microscope) will raise rates reluctantly, too little and too late to do much good for the economy. Tiff Maclem is no John Crow (who raised rates 100 bps at a crack to kill inflation , back in the day)
All is proceeding as predicted.