subject: Vancouver Foreclosures Set to Rise [print this page] Economist David Rosenburg predicts an increase in mortgage defaults in Canada.
The chief economist at GluskinSheff + Associates points to eroding real estate values and interest rate increases as the catalysts that willtrigger an increase in real estate foreclosures in Vancouver and across Canada.
Housing starts, building permits and home prices have slipped since the Spring and the housing marketboom that propelled Canada out of recession is losing momentum. Rosenburg believes that even if Canada's real estate marketexperiences a fraction of the correction that occurred in the US, financial markets and the Canadian economy as a whole will be "in for a rude awakening."
While on the subject of Vancouver foreclosures, well-knowneconomic doomsayer NorielRoubini has warned that there's more pain to come. Mr. Roubini, also known as Doctor Doom, is famous for predicting the financial meltdown of 2007/08. He says a double-dip recession is not out of the question and that our current environment already feels recessionary.
Quote:
"if the economic data surprise on the down side, we are going to have a correction of the stock markets, widening of credit spreads, increased volatility, increased risk aversion, then it leads to a shock for the real economy."
Don't expect a glut of new foreclosures to hit the market all at once in Vancouver. While mortgage defaults might rise, many of these can and will be rectifiedbefore the process actually gets to a court ordered sale. Also, keep in mind that Canadian foreclosure law affords a lot more protection to the home owner. Thirty cents on the dollar foreclosurefire sales don't happen here.
Lets hopeMessrsRosenburg and Roubini are both wrong.
