ALWAYS CONSULT YOUR INVESTMENT PROFESSIONAL BEFORE MAKING ANY INVESTMENT DECISION
Steve Saretsky
Steve Saretsky is a Vancouver residential Realtor and author behind one of Vancouver’s most popular real estate blogs, Vancity Condo Guide. Steve is widely considered a thought leader in the industry with regular appearances on BNN, CBC, CKNW, CTV and as a contributor to BC Business Magazine. Steve provides advisory services to banks, hedge funds, developers, and various types of investors.
June 14th, 2022 | The Saretsky Report – June 2022
The Saretsky Report - As has been the theme for the past few reports, inflation and interest rates remain front and center. Inflation remains stubbornly high and central banks are panicking to reign it in. They are now tasked with the impossible mission of killing enough demand to bring commodity prices (energy) down, without triggering a financial mistake and […]
June 13th, 2022 | The Great Moderation
Steve Saretsky Blog - Another week, another bump higher in borrowing costs. The Canada 5 year bond yield ripped again, climbing above 3.3%, the highest reading since March 2008. Last time rates were this high bad things happened. As has been the theme of this newsletter for the past month or so, I continue to believe this is a […]
June 6th, 2022 | Soft Landings
Steve Saretsky Blog - The Bank of Canada raised interest rates another 50bps this past week, signalling more pain to come. The overnight rate sits at 150bps, just shy of where the Bank of Canada got stopped out in 2019. Markets are still pricing in another 150bps of additional tightening this year, which suggests the overnight rate will sit […]
May 31st, 2022 | Appraisers are Skittish
Steve Saretsky Blog - More monetary tightening is heading our way this week with the Bank of Canada fully expected to hike interest rates another 50bps on Wednesday. Assuming they do indeed hike rates by 50bps on Wednesday, Markets are still pricing in another 125bps of tightening by the end of the year. Of course, much of this depends […]
May 16th, 2022 | The Rout is On
Steve Saretsky Blog - It was another volatile week for financial markets. Nearly $11 trillion was erased from global equity values. If you start adding the bond and crypto markets we have $35 trillion in wealth that has evaporated. I’m often asked where is all the money coming from? How are people coming up with the down payments for […]
May 10th, 2022 | The Saretsky Report – May 2022
The Saretsky Report - Last month we discussed the beginnings of a slowdown, and that theme continues this month. For the first time since 2010, the lowest nationally-available uninsured 5-year fixed rate mortgage is now north of 4%. This means that any buyer opting to make a purchase using a 5 year fixed rate will be stress tested at […]
May 9th, 2022 | Payment Shock for Some
Steve Saretsky Blog - We need higher rates to moderate demand, including demand in the housing market. Housing price growth is unsustainably strong in Canada. That was the message from senior deputy governor of the Bank of Canada, Carolyn Rogers this past week. Yes, the central banks continues to talk up further rate hikes, with the goal of slowing […]
May 2nd, 2022 | Team Transitory Has Disbanded
Steve Saretsky Blog - No regrets. That was the message from Bank of Canada governor Tiff Macklem when asked about his broken promise on holding rates at zero until the end of 2023. If you recall, in July 2020 Macklem gave the green light for Canadians to speculate on housing, announcing “If you’ve got a mortgage, or if you’re […]
April 25th, 2022 | Not Bullish Sentiment
Steve Saretsky Blog - While this is probably getting tiresome at this point, inflation came in hot once again in March, hitting a 30 year high. Consumer prices are up 6.7% from last year, and are likely to hit 8% in April based on Stats Canada finally adding used car prices to the CPI basket. This is ramping up […]
April 18th, 2022 | Arsonist & Firefighter
Steve Saretsky Blog - For the first time in over 20 years, the Bank of Canada raised rates by over 50bps at their most recent meeting. Everyone is panicking, inflation is here and the Bank of Canada is acting tough, they’re no longer going to support the housing market, so naturally a housing crash is just around the corner, […]
April 15th, 2022 | Saretsky Report April 2022
The Saretsky Report - Last month I wrote about the early signs of the housing market beginning to turn. Fewer offers, less FOMO, etc. Again, none of this should have come as a surprise, we’ve had two years of record home sales and runaway price growth, and trees don’t grow to the sky.
April 11th, 2022 | Headline Grabbers
Steve Saretsky Blog - The Federal Government unveiled an updated budget this past week, and it included a wide range of housing policies. While many of these were good headline grabbers, some of them will never see the light of day, and others lack any real substance. Let’s dissect some of them further. Foreign Buyer Ban The media took […]
April 4th, 2022 | End of the Housing Bull Market?
Steve Saretsky Blog - It’s official, mortgage rates have hit 4% here in Canada. Several of the large banks have increased their popular 5 year fixed rate mortgage above 4%. You’d have to go back to about 2013 when rates were this high. Also worth adding that 2013 was a pretty slow year for housing and so I expect […]
March 28th, 2022 | Not Until Something Breaks
Steve Saretsky Blog - Happy Monday Morning! It looks like inflation might not be transitory after all, and the bond market is finally figuring that out. Bonds have been selling off hard lately, sending yields much higher, and tightening financial conditions in the process. This is particularly important for the Canadian housing market. If there was ever a catalyst […]
March 21st, 2022 | Purchasing Power is Getting Slaughtered
Steve Saretsky Blog - Consumer prices ripped to a thirty year high in Canada, rising 5.7% from last year. Shelter inflation was up 6.6%, the highest since 1983. Per ScotiaBank, much of that is being driven by the homeowners’ replacement cost, which was up 13.2% y/y. Unlike the US that uses owners’ equivalent rent, Canada captures housing primarily through […]
March 14th, 2022 | Stability in a World of Volatility
Steve Saretsky Blog - Inflation concerns continue to percolate. US CPI inflation ripped to 7.9% in February, the highest reading in over 40 years. So now we basically have inflation at 8% and interest rates at zero. Of course this has major implications not only from a financial perspective but a societal perspective. It’s also a fundamental driver behind […]
March 12th, 2022 | The Saretsky Report – February 2022
The Saretsky Report - I’m about to walk you through the usual Saretsky Report where we highlight all sorts of charts and data points pertaining to the housing market. What I want to emphasize is that the situation is changing rather quickly. A war has erupted in Ukraine, commodity prices are ripping- adding to inflationary pressures, and the Bank […]
March 7th, 2022 | Volcker Moment?
Steve Saretsky Blog - Brace yourselves, we have liftoff! The Bank of Canada officially raised interest rates a mere 25bps last week. This was the first move since 2018 and comes at a time when inflation is running at 30 year highs. Markets believe another 5-7 rate hikes are still coming this year and some are calling this the […]
February 28th, 2022 | Now What?
Steve Saretsky Blog - I have long argued that a sell-off in Canadian housing will not be self-induced. In other words, policy makers are not going to willingly tank the market. If / when you have a downturn it will be due to something out of our control, likely a crisis in emerging markets that ripples through global financial […]
February 22nd, 2022 | Bullish Government Incompetence
Steve Saretsky Blog - I know you probably don’t need another reminder on inflation so i’ll keep this brief. Inflation figures ticked higher again in January, with consumer prices rising 5.1% from last year. Prices are now rising at their quickest pace since 1991. In other words, so long as you don’t eat, drive a car or own a […]
February 14th, 2022 | Not So Fast
Steve Saretsky Blog - Inflation in the United States surged to 40 year highs in January, with consumer prices growing by 7.5% year-over-year. The last time inflation was rising this quickly the fed funds rate was sitting at 15%, today it sits at zero. This is ramping up calls for aggressive interest rate increases in order to quell inflation, […]
February 9th, 2022 | The Saretsky Report – January 2022
The Saretsky Report - For regular readers of this report you will remember that 2021 marked a record year for Greater Vancouver home sales, smashing through previous highs set in 2015. That momentum has carried over into 2022. Sales remain incredibly strong, still running more than 30% above the long run average. Meanwhile, inventory in the month of January […]
February 7th, 2022 | Home to The Middle Class
Steve Saretsky Blog - Everyone is well aware of the great reshuffling throughout the pandemic. People migrated away from the city, opting for more space and privacy while they worked from home. Everyone rushed out to the suburbs. Similar to the toilet paper crisis at the onset of the pandemic, housing inventory in the burbs was swiftly plucked bare. […]
January 31st, 2022 | Truth is Like Poetry
Steve Saretsky Blog - To the dismay of prospective home buyers hoping for a cool down in the nations housing market, Bank of Canada governor Tiff Macklem left interest rates unchanged this past week. It was an odd move considering a 25bps rate hike was already priced into the markets, and there would have been no justification needed, given […]
January 25th, 2022 | Worst Buying Conditions on Record
Steve Saretsky Blog - Consumer prices continue to rip higher in Canada, officially growing at their fastest pace in 30 years per Stats Canada data this December. Consumer prices were up 4.8%, while shelter costs, which make up a part of the CPI basket, were up 5% from last year. Of course this is stirring the ongoing debate on […]