Risk is a fact of life; whether you’re purchasing equities and watching them rise or fall, buying a new condo construction and hedging your bets on the increase in values, or even getting married (lets face it the numbers state it has a 60% success rate; or said another way, a near 40% failure rate). There’s even risk in the mortgage business… calculated risks; but risks nonetheless.
We all have to live our lives, increase our wealth, and raise our families. So that means taking some risks along the way and doing so with our eyes wide open.
Keeping up with the news in Canadian business and Canadian real estate can be a wearisome task. Wednesday November 25th saw the Vancouver Sun reporting B.C. home affordability takes a hit as prices rise in hot market; according to RBC. Three days later, the Calgary Herald reports that Alberta’s resale market readies for rebound. Sometimes we even look to our neighbors south of us with some curiosity; for example, The Financial Post ran an article two Friday’s ago explaining Why U.S. mortgage-interest deductibility won’t come to Canada; again giving us something to think about. There is also a very interesting edition of Focus Newsletter from BMO Capital Markets that highlights some of the week’s top financial topics (this week’s edition includes a very interesting article – starting on page 7 – that speaks to several worrisome trends in Canada). You’ll need Adobe Acrobat to open this PDF link.
At the end of the day, and with all the swirling news and information, one has to trust his/her gut instincts and considerthe facts. Be cautious and brave (maybe even in marriage).
At Alta Pacific Mortgages we invite you to learn about our approach to earning a healthy return for our investors. We tirelessly watch the news as well as the facts and figures for BC, Alberta – all of Canada for that matter. We are excited about the future in placing mortgages in the Western Canadian market as much as we’re proud of our past. We look forward to speaking with anyone that would like to discuss the option of investing in Canadian real estate by investing in Canadian mortgages. Investing in a MIC (Mortgage Investment Corporation) might just be the right fit for you. We believe it’s a wise move if you’re aligned with the right team.
Bob Dugan, Chief Economist for CMHC states “In the second half of 2009 and in 2010, we expect housing markets across Canada to strengthen.” Improving activity on the resale market and lower inventory levels in both the new and existing home markets are expected to prompt builders to increase residential construction. – from CMHC press release
Whether you read your favorite business magazine, the local business section of the newspaper, or talk to your trusted wealthy uncle; there is a general feeling of recovery in the global economy. Here in Western Canada we have not experienced the same affects as our neighbors to the south or even to the east (meaning eastern Canada). If you’re an Albertan, recent news like Wednesday’s announcement that privately owned Athabasca Oil Sands Corp. will sell a majority stake in its operations to PetroChina International Investment Co. Ltd. for $1.9 billion certainly might come as positive news. And lets be honest, much of the Western Canadian boom in the past decade can be linked to massive investment in Alberta and BC’s oil and gas industries.
So the press release today from CMHC seems to coincide with these feelings and indicators; and we’re sure if you’re a home builder you’re encouraged by the positive expectations and outlook on Canadian housing starts.
At Alta Pacific Mortgages we appreciate positive news in these sectors of the economy as well – and since we keep our ears and eyes keenly focused on what is happening in our BC and Alberta “backyard” we also have greater confidence in deals we sign for mortgages on real estate in BC and Alberta. With offices in Vancouver and Edmonton we welcome you to talk to us about either investing in Canadian mortgages through the Alta Pacific Mortgage fund … or if you’re a mortgage broker, home owner, developer or real estate investor; we invite you to speak to us about potential deals you might like us to consider.
We checked the news today and there’s plenty of positive reports about real estate in BC. We keep our eyes and ears open as we constantly assess the current state of real estate in Western Canada. We also know that regardless of positive or negative news, sound investments in real estate and mortgages are always out there – you just have to find them. We’re Alta Pacific Mortgage Investment Corporation and investing in Canadian mortgages is what we do. Feel free to contact us if you’re interested in the option of investing in a MIC.
The following news stories came from the past few days in the Vancouver Sun.
Lower Mainland real estate markets saw big gains in June sales with the Metro Vancouver real estate board posting its second busiest and the Fraser Valley its fourth most active June on record. It was a factor of the slide in real estate prices last year and current low interest rates that were enough to offset the negative influences of higher unemployment and a contracting economy. more »
Greater Vancouver realtors had their second busiest June on record this year as buyers jumped at lower property prices and near record low mortgage rates, the Real Estate Board of Greater Vancouver reported Friday. Board realtors recorded 4,259 sales through the Multiple Listing Service in June, a 76-per-cent increase from the same month a year ago. more »
Fraser Valley realtors recorded their fourth busiest June on record racking up 1,982 sales during the month, a 40-per-cent increase from the same month a year ago. more »
Real estate sales on Vancouver Island in June bounced back from the lower levels of 2008, though prices remain below those achieved a year ago, the Vancouver Island Real Estate Board reported Thursday. Island communities outside of Victoria saw sales of 523 detached homes recorded through the Multiple Listing Service in June, a 20-per-cent increase from the same month a year ago more »
If you were waiting for the real estate market to cool further before buying, you may have waited too long more »
What does this have to do with us at Alta Pacific Mortgages? Well, its Canada Day so we’re having some fun with friends and family today and of course watching the NHL Free Agency activity. But there’s some strong connections between NHL players, celebrities, and real estate.
News this week from BC showed some higher end real estate activity on Vancouver Island as the former Vancouver Canuck Courtnall brothers sold properties in the $6M range. We also heard about Minnesota Wild Marian Gaborik making some real estate moves in Vancouver (according to multiple sources and The Province newspaper) as he purchased a home in West Vancouver. Could it be that his pal Pavol Demitra told him how nice Western Canadian living is? Or is Canuck GM Mike Gillis a Realtor on the side?
Professional sports stars need to be careful with their money though. The March 23, 2009 issue of Sports Illustrated magazine stated that most NBA players are broke five years after their careers end. (and) Within two years of retirement, 78% of former NFL players have gone bankrupt or are under financial stress, while an estimated 60% of former NBA players are broke within five years of retirement.
Recently NHL players have experienced encounters with unscrupulous developers in the real estate market. The National Post described (10 days ago) how a real estate developer duped 19 NHL players out of $25M.
Now, if you’re a Canadian who does not sign multi-million dollar contracts to lace up the skates, we think investing in Western Canadian real estate is a wise choice to establishing financial security. Yesterday’s news in the Edmonton Journal echoes this as it reported that Alberta remains best place for real estate investors. The key in real estate investing in to connected to folks with integrity, experience and professionalism. We think you’ll find all three Alta Pacific Mortgages. With offices in Edmonton and Vancouver, we’re a mortgage investment corporation (or MIC as they’re commonly known) that focuses on three things for our investors – Security. Growth. Transparency.
In the last couple days we have received several resources that you might find interesting. Certainly we use information like this in the process of analyzing deals here at Alta Pacific Mortgages.
The first article is written by CIBC and features an economic snapshot by cities across Canada. It is always interesting to see the more micro look at economic indicators rather than reading about the country as a whole. What’s happening in Regina versus Calgary can be quite significant – article can be read here.
The second article is written by MPC Intelligence in Vancouver BC and features an in-depth look at downtown Vancouver’s condo market. The most accurate analysis we’ve seen of non-owner occupied versus owner occupied in downtown condos. The article also provides great insight into 2009 and 2010 as additional product is introduced in Vancouver (for example: We expect that a further 1,114 high‐rise condominium completions within the sample area during the final three quarters of 2009) – complete article can be read here.
From article in last week’s Vancouver Sun newspaper – Metro Vancouver recorded its best year-over-year sales increase in May since February 2008 with 3,524 sales reported through the Multiple Listing Service, 17 per cent higher than the 3,002 sales recorded in the same month a year ago.
One month doth not a trend make but certainly there are some signs of increased activity in BC’s Lower Mainland real estate market. We interact daily with many of the region’s busiest and most active real estate agents, developers and mortgage brokers and there is certainly signs of increased activity. Maybe all this early summer (actually its still officially spring) sun and warmth is waking up the neighbors.
Not only is the Lower Mainland showing some positive signs but previously owned U.S. homes shot up by 6.7 per cent in April, the biggest monthly gain in 7-1/2 years (according to many news sources including the Financial Times)
Calgary’s Real Estate Board confirmed the trend recently, noting year-over year MLS sales for single family homes and for condominiums were higher for the first time in months, with May sales surpassing May 2008 sales – see article in the Calgary Herald.
As investors in Canadian real estate and Canadian mortgages, we’re cautiously optimistic about these late spring / early summer numbers. Alta Pacific Mortgages is certainly watching the numbers closely and we continue to see very attractive opportunities to place investors funds in quality mortgages secured by real estate.
You’ll see us write a lot on our blog about what others are saying about the local, national and international economies. We do this because there’s a lot of very intelligent people that spend a lot of their days (and perhaps nights) pouring over stats, trends, figures, and their good judgement to come up with their predictions and forecasts. And often they are correct!
News out last week (that we just read today) from Goldman Sachs’ economists (Peter Berezin and Alex Kelston) stated that our country in well positioned to emerge as one of the first advanced economies of the world to return to a normal rate of economic growth (full article in the Financial Post can be found here). They also reported last Thursday that Canadian consumer optimism was growing (article found here). Many times its just good news that we all want to hear!
While these high level predictions from big Wall Street and Bay Street firms and economists are informative, each Canadian has a different personal situation. For many the current recession has meant hardship, for others caution, and for some great opportunity and growth.
If you live in Western Canada like we do there are certainly signs of both economic struggle and growth; nearly at the same time. Real estate prices (in certain segments of the market and in certain geographic areas) are affected at varying rates (then again, isn’t that natural regardless of recession or economic growth). Oil prices are of great interest to Albertans and the real estate and tourism markets to British Columbians. It could be said that these key indicators are internationally influenced for Alberta (oil prices) and perhaps more regional for the folks in BC (neighbors to the south AND east – namely Alberta – affect real estate and tourism in a hurry).
At Alta Pacific we are optimistic of where we are and where we’re heading. We’re a young company/fund and yet we are an experienced group of partners (over 50 years experience between us). We feel very fortunate for our timing in launching our company and welcome you to speak to us about investing in Western Canadian real estate through our mortgage pool (or MIC as we’re referred by). Investing in mortgages has long been an investment option primarily available to sophisticated and affluent investors… Alta Pacific MIC allows investors at all levels to share in the returns generated by mortgages in Western Canadian real estate. We invite you to learn more about what we’re passionate about! We’ll leave the international forecasting to Goldman Sachs and others on Bay Street and Wall Street
A report issued this week by Canada’s CIBC bank states that the US banking crisis may be over. Read the report here.
Whether you agree or disagree with this report, it might just be irrelevant. In fact how many big “thinkers” and economist correctly forecast the meltdown of 2008?
We at Alta Pacific Mortgages like the article on Forbes.com that was in the April print issue – The Banker Who said No. The following excerpt from the article sure makes a banker like Andy Beal appear as an impressive fellow….
For three long years, from 2004 to 2007, he [Andy Beal] virtually stopped making or buying loans. While the credit markets were roaring and lenders were raking in billions, Beal shrank his bank’s assets because he thought the loans were going to blow up. He cut his staff in half and killed time playing backgammon or racing cars. He took long lunches with friends, carping to them about “stupid loans.” His odd behavior puzzled regulators, credit agencies and even his own board. They wondered why he was seemingly shutting the bank down, resisting the huge profits the nation’s big banks were making. One director asked him: “Are we a dinosaur?” Now, while many of those banks struggle to dig out from under a mountain of bad debt, Beal is acquiring assets. He is buying bonds backed by commercial planes, IOUs to power plants in the South, a mortgage on an office building in Ohio, debt backed by a Houston refinery and home loans from Alaska to Florida. In the last 15 months Beal has put $5 billion to work, tripling Beal Bank’s assets to $7 billion, while such banks as Citigroup and Morgan Stanley shrink and gobble up billions in taxpayer bailouts.
So back to the topic of the US banking crisis being over… it might just be irrelevant if assets are managed wisely during all economic conditions. As Beal Bank is proving, a crisis can provide a great opportunity for those not caught in the storm. We believe Alta Pacific is poised to take advantage of such opportunities in Western Canada real estate. Investors (RSP or private placement) wishing to take advantage of such opportunities are invited to contact us to learn more.
As always, a very thorough and insightful report from CMHC. We’ve blogged about these reports before and always find them a valuable source of information; both nationally as well as by province.
See page 6 of the report for high level overview by province. Page 9 includes full details for British Columbia real estate and BC housing starts. See page 10 for Alberta real estate and housing starts details.
For us at Alta Pacific it pretty much confirms our belief in investing in Canadian mortgages. Placing investment funds in mutual funds, securities or any equities sounds a little worrisome given the current statistics provided in this article. We certainly feel more comfortable with Western Canadian real estate for the short and longer term.
Posted by altapacific 
Posted by altapacific 
Posted by altapacific 
