# Home ownership is bad for the economy?



## none (Jan 15, 2013)

I believe this is the case for Canada simply because all the stimulative cash has been dumped into mortgages as opposed to stimulating demand throughout the economy as it should. This article, however, is interesting and talks about the 'external costs' associated with home ownership. If it's to be believed (it seems to be fairly pursuasive) it certainly doesn't bode well for the Canadian economy at 70% home ownership:

http://www.nytimes.com/2013/05/10/b...-may-actually-cause-unemployment.html?hp&_r=1

Also, if garth is right on this one - get ready for the Toronto & Vancouver markets to get killed this coming year.

http://www.greaterfool.ca/2013/05/09/busting-the-banks/


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## Hawkdog (Oct 26, 2012)

Interesting. But fairly generalized. 

So here is a bit of info related to the first article with regards to mining.
- the average wage is now 122,000 or so
- mines are camp jobs for the most part - people can live anywhere - people travel from SK to BC for work or vice versa
- our company employs approx 160 people in Canada - they live from Van Isle to Nova Scotia - except for the 40 or so office staff stay the rest work roughly 4 weeks on 2 weeks off all over the country.

- similar stuff with the oilsands.

this is relevant to the where the article discusses how buying houses limit the work force. not sure if that is always the case.


Side note:
So my wife's aunt just sold their house in Vancouver (POCO) earlier this year for a million bucks, the owners are tearing it down and building a new house, the house is close to the ocean.
The aunt has a friend who has a house on the water - her neighbour came over this month and said i need a house for my mom to live in, i will give you 2 million for your house without even stepping inside of it.
These are houses the people bought 30 years ago and are old houses.


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## Hawkdog (Oct 26, 2012)

another trend they had on the news this week was for more families (young families) to start living downtown Vancouver because of the lifestyle, nice parks, no need to commute to work. There is actually a shortage of 3 bedroom condos rights now,(according to the news) of the approx 1200 condos currently for sale in Vancouver only 130 were 3 bedroom, and only a handful were under 700,000.

I am not sure that comparing numbers of unemployment in 1950 and 2010 is relevant? do you? this is a whole new era of info technology etc - loss of manufacturing oveseas? 


And I question this statement below as well, i could be wrong but don't you think the people renting house or the landlords are going just as adamant about stuff in their back yard? People have to live somewhere. I would speculate the role of building up (which maybe part of zoning but is more related to the white picket fence dream) and improvement of commuter transportion may be important

"If the correlation is real, what could be the cause? The professors say they believe that high homeownership in an area leads to people staying put and commuting farther and farther to jobs, creating cost and congestion for companies and other workers. They speculate that the role of zoning may be important, as communities dominated by homeowners resort to “not in my backyard” efforts that block new businesses that could create jobs. Perhaps the energy sector would be less freewheeling in North Dakota if there were more homeowners."

Interesting topic for sure thanks for posting.


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## none (Jan 15, 2013)

Mining is certainly a special case. I worked at a mine this past summer (baseline assessments) and I spoke to one guy who owned a place in marathon - I asked - why the hell?? He said it was because he bought his house for 60K. It's pretty hard to argue with that. I see your point about mobility and I guess mining (or information tech. is a good example of that) but then I hear stories of people who commute to Toronto from Guelph or Barrie. -- What kind of life is that??? Two hours a day commuting - yeash, just shoot me in the face already.

BTW, I've looked at the platforms and I think I'm going NDP - sorry about your house. 

A colleague of mine has a house in Vancouver and she says it's worth 1.8 million. How ridiculous is that? A 25 year mortgage on that would be 10K a month even at current interest rates! Bizarro l


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## andrewf (Mar 1, 2010)

The BC NDP seem pretty backwards between their opposition to the carbon tax and HST.


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## Hawkdog (Oct 26, 2012)

I agree shoot me if i have to commute 2 hours - especially if its for a normal 20 minute drive!

So was it the NDP stance on decriminalizing pot that got ya? 





none said:


> Mining is certainly a special case. I worked at a mine this past summer (baseline assessments) and I spoke to one guy who owned a place in marathon - I asked - why the hell?? He said it was because he bought his house for 60K. It's pretty hard to argue with that. I see your point about mobility and I guess mining (or information tech. is a good example of that) but then I hear stories of people who commute to Toronto from Guelph or Barrie. -- What kind of life is that??? Two hours a day commuting - yeash, just shoot me in the face already.
> 
> BTW, I've looked at the platforms and I think I'm going NDP - sorry about your house.
> 
> A colleague of mine has a house in Vancouver and she says it's worth 1.8 million. How ridiculous is that? A 25 year mortgage on that would be 10K a month even at current interest rates! Bizarro l


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## Hawkdog (Oct 26, 2012)

So what do you call 12 geologists in BC during NDP reign?

A spanish class...........


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## none (Jan 15, 2013)

Hawkdog said:


> I agree shoot me if i have to commute 2 hours - especially if its for a normal 20 minute drive!
> 
> So was it the NDP stance on decriminalizing pot that got ya?


Actually it was mainly the sorting out of the BC liquor laws. I find it really annoying that I can't take my two year old to a pub (but I can feed him tequila at home if I wish) and their push for BC endangered species legislation.


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## Hawkdog (Oct 26, 2012)

none said:


> Actually it was mainly the sorting out of the BC liquor laws. I find it really annoying that I can't take my two year old to a pub (but I can feed him tequila at home if I wish) and their push for BC endangered species legislation.


it would be nice if you could buy a bottle of wine at Safeway as well.

I am actually all for a BC environmental process, but its needs to be consistent and it needs to have timelines so a company can plan - it can't be like maybe and drag on and on because then investors will go to a different jurisdiction.


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## none (Jan 15, 2013)

Sure - but mines' get a pretty sweet baseline deal -- two years of monitoring to assess an impact assessment? From a scientific perspective that isn't even close to adequate but I don't think people would be willing to wait 10 years or more. 

If you don't mind me asking what mine to you work for?


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## GoldStone (Mar 6, 2011)

none said:


> BTW, I've looked at the platforms and I think I'm going NDP - sorry about your house.


Sorry about your Canadian Index ETF. It's choke full of resource companies that desperately need the new pipelines. I hear NDP is going to block them.

So yeah... sorry about that ETF.


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## none (Jan 15, 2013)

GoldStone said:


> Sorry about your Canadian Index ETF. It's choke full of resource companies that desperately need the new pipelines. I hear NDP is going to block them.
> 
> So yeah... sorry about that ETF.


That's OK, I'm in the process of dumping Canada in general and going America - kanuckistan is on its way down regardless.


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## GoldStone (Mar 6, 2011)

none said:


> That's OK, I'm in the process of dumping Canada in general and going America - kanuckistan is on its way down regardless.


Sell low, buy high. Perfect.


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## Charlie (May 20, 2011)

I'm sure there's a lot more to the study then what I absorbed when skimming the article....but when they cite Alabama Georgia Mississippi, S Carolina and W Virginia against California, N Dakota, Oregon, Wash and Wisconsin to conclude home ownership rates impact unemployment, I'm skeptical. Seems more likely to me, that low house prices in the first group and lack of jobs means fewer renters, and thus higher ownership %age. I can't see NIMBY being more prevalent in Alabama then in California nor commutes being less in any of the first group compared to similar cities in the latter group.

My guess is that San Francisco isn't booming because fewer people own. Fewer people own because it's booming -- resulting in more renters going there, and higher home prices overall.


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## Hawkdog (Oct 26, 2012)

none said:


> Sure - but mines' get a pretty sweet baseline deal -- two years of monitoring to assess an impact assessment? From a scientific perspective that isn't even close to adequate but I don't think people would be willing to wait 10 years or more.
> 
> If you don't mind me asking what mine to you work for?


I don't actually work for a mine, I work for diamond drilling company, we look for mines.


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## none (Jan 15, 2013)

That can be a tough job. I go up to Ekati from time to time. Pretty fun place to work.


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## MoneyGal (Apr 24, 2009)

Hawkdog said:


> I don't actually work for a mine, I work for diamond drilling company, we look for mines.


Yeah, Chuck Fipke was one of my dad's grad students. I knew him when!


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## Hawkdog (Oct 26, 2012)

MoneyGal said:


> Yeah, Chuck Fipke was one of my dad's grad students. I knew him when!


Cool! is he pretty much an ICON!

We don't do any diamond exploration, mostly precious metals and uranium.


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