2300 replies to this topic

[Sparky]

Absolutely. Although the sales of luxury items like iPhones is probably not a good indicator for the health of household finances. Lots of fancy toys were bought with home equity in the US as well.

A $179.00 iPhone is hardly a luxury item.

[Nparker]

A $179.00 iPhone is hardly a luxury item.

But you must admit that replacing your telecommuications device every year at nearly $200 or more for no legitimate reason other than to "keep up with the Jones" is at least frivolous.

[Sparky]

But you must admit that replacing your telecommuications device every year at nearly $200 or more for no legitimate reason other than to "keep up with the Jones" is at least frivolous.

That's an assumption on your part. In my case, my phone was up for renewal and our business renews every three years whether we like it or not.

Geezus.

[Sparky]

^^ If you want to take this further, let's go to the "Mobile Technology" thread and discuss the pros and cons of having a computer in your pocket.

[pherthyl]

A $179.00 iPhone is hardly a luxury item.

It's funny that you think it costs $179. Score one for carrier marketing.

An iPhone 5 starts at $699. The fact that a carrier is subsidizing that upfront cost as enticement for a multiyear contract is irrelevant.

[Sparky]

Let's get back to the housing bubble....at least that I can understand.

I just sold a 5 acre piece of property complete with a 6000 square foot house for 19.9 % less than assessed value....not appraised value....assessed value.

.....and you are poking me about the cost of a business phone that is a tax write off???

The thing is the assessed value was too high. Reality is lower than that in a market that has seen over inflation and is now due for a correction.

I've gotten over both these issues....so should you.

[true blue oak]

Sparky - wise to have got out now. I hope that you purchased the property before 2004-5.

[Sparky]

Sparky - wise to have got out now. I hope that you purchased the property before 2004-5.

Yes, thank you...we built in 1994.

It is not the price of real estate that scared us....it is the interest rates.

I grew up with a mortgage rate of 10%...(that was doable in the 60's and 70's)..but then I lived through the early eighties at 16%....painful to say the least.

The first mortgage rate at present can be between 3 and 5 %.

A one or two point increase will set the cat amongst the pigeons.

When you look at the economies in Spain, Italy, and Greece....I smell worldwide trouble that will eventually affect us all.

Kinda makes the price of a cell phone seem somewhat miniscule doesn't it?

[Szeven]

I would be interested to hear the context of Sparky's move. I sold a house in Fernwood in August 2009 purely because of macro economic worries. I would currently be further ahead to have held and rented it. I am now very cautious to make outright calls on the macro situation, because you might think you know the parameters, until a government steps in and flips things upside down.

Right now, for instance, there is a growing 'rage' (imo, could be wrong) that rates rising might destroy housing. I do not understand this. If the economy is slow, and the US fed is holding rates at 0 until 2015 (which im sure is more like 2020), how can Canada raise rates? Are people selling because they are worried about a credit crunch and deflationary pressure on asset prices? Maybe people look at Japan and expect 20 years of it? Hard to bet on that when we are electing communist tax and spend governments, and Ben Bernanke is at the helm in the US.

So what exactly is the argument? Any slowdown will be met with lower rates and heavy stimulus, so arent you better off keeping your house and hedging in another currency, asset class, or metals?

[Nparker]

Hard to bet on that when we are electing communist tax and spend governments...

You think Harper's CON-servatives are "communist tax & spend"?

[Sparky]

Szeven, you are wise to ask the question. We downsized and built a smaller house.

We rented out the old house for a couple of years. The income tax regulations took all the fun out of a possible future capital gain. Couple that with the uncertain real estate values (and yes we calculated in the fact that possible interest rate rises could affect the property values) it just was not worth the risk.

Simple as that.

[Sparky]

You think Harper's CON-servatives are "communist tax & spend"?

The new provincial NDP government in 2013 might fall into that category.

[Nparker]

Well first the NDP have not yet been elected, so it's a premature assumption. Second, they are hardly communist; socialist yes, but not communist. And last, since when did the provincial government dictate banking policy and set interest rates?

[dasmo]

6000 SQ feet is a lot!
If you were renting for positive cash flow and didn't need the capital for something else why worry about all that stuff. It's generating income for you?

[Sparky]

since when did the provincial government dictate banking policy and set interest rates?

Help me out here Nparker, what made you think that I said that?

What does this have to do with the topic of the thread?

[Sparky]

6000 SQ feet is a lot!
If you were renting for positive cash flow and didn't need the capital for something else why worry about all that stuff. It's generating income for you?

Our beloved Canada Revenue Agency adds the rental income to your annual salary and kicks you into a tax bracket that takes the fun out of treading water.

[sebberry]

Nobody can get a break anymore, can they?

[pherthyl]

Let's get back to the housing bubble....at least that I can understand.

I just sold a 5 acre piece of property complete with a 6000 square foot house for 19.9 % less than assessed value....not appraised value....assessed value.

.....and you are poking me about the cost of a business phone that is a tax write off???

Not poking, just saying it's a luxury item, which it is amongst smartphones. Not judging, I have one too, paid for by work.

The thing is the assessed value was too high. Reality is lower than that in a market that has seen over inflation and is now due for a correction.

I've gotten over both these issues....so should you.

So we agree. Not sure if that was supposed to be an argument.

[pherthyl]

6000 SQ feet is a lot!
If you were renting for positive cash flow and didn't need the capital for something else why worry about all that stuff. It's generating income for you?

I'm gonna go out on a limb and guess the cap rate on a 6000sqft mansion on 5 acres isn't exactly worth writing home about.

[Sparky]

^ I agree.