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Friday, 6 June 2014

TD Says Canadian Housing Overvalued BY 10%???

Housing market 10% overvalued in Canada amid condo risks, data uncertainty: TD executive



TORONTO — Canada’s housing market is 10% overvalued, with the biggest risks in condominium overbuilding and uncertainty over how many investors are buying, but the risk of a U.S.-style collapse is low, a top executive at Canada’s second largest bank said on Monday.

“The high-rise condo market is an area we’re certainly watching closely, and I think all of the other banks, as well and the regulator, (are watching),” Lisa Reikman, chief risk officer of Canadian banking at Toronto-Dominion Bank, said.Lisa Reikman, chief risk officer of Canadian banking at Toronto-Dominion Bank, said a spike in interest rates or unemployment could threaten Canada’s robust housing market, but the risk is fairly low.
Instead, TD Bank, one of the country’s top three mortgage lenders and a growing retail banking presence on the U.S. East Coast, is watching house appreciation and the growing supply of condominiums.
“The high-rise condo market is an area we’re certainly watching closely, and I think all of the other banks, as well and the regulator, (are watching),” Ms. Reikman said in an interview.
“Just by virtue of the fact there is a lot of new construction of high-rise condos, and there are some questions around … how many of those are being purchased by investors as opposed to people (who) are actually living in them as a primary residence,” she told Reuters.


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Insights...

Housing prices and assets values will collapse by 50 to 75% 

when interest rates spike by 3 to 4%. or more. That's just 
mathematics. What will cause the spike? Oil prices are bound
 to jump to 500 or 1000 a barrel within 5 to ten years, if not sooner. Food  and material costs will rise proportionately, all of which is 
inevitable. That's just physics.

And both are just logic.


Investors' Insights

June 6, 2014


Who are these Bankers??? 
Ask George.

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