Cheap houses in the US are requiring more money down on the mortgage, although it still looks pretty low:
Already beset by stagnant wages, growing student debt and competition from investors who are snapping up listings, those looking to purchase moderately priced houses must also provide more cash up front. The median down payment for the cheapest 25 percent of properties sold in 2013 was $9,480 compared with $6,037 in 2007, the last year of the previous economic expansion, according to data from 25 of the largest metro areas compiled by brokerage firm Redfin Corp.
…
The median down payment for the cheapest 25 percent of homes was 7.5 percent of the sales price last year, up from a low of 3.1 percent in 2006 and compared with an average 4.2 percent from 2001 through 2007, according to Seattle-based Redfin. For properties in the middle 50 percent, the share rose to 8.8 percent in 2013 from an average 8.2 percent in the seven years leading to the last recession, and for the top quarter it climbed to 20.9 percent from 19 percent.
… while in Canada, forecasters are jostling to see who can predict higher prices:
The Conference Board of Canada on Wednesday boosted its forecast for condo resales and prices in Toronto. It now anticipates that 20,083 condos will sell over MLS in the city this year (a year ago, the Conference Board expected that number to be 19,080) at a median price of $316,744 (it previously expected that to be $310,242).
The Conference Board also raised its forecasts for resale condo prices in Calgary, Edmonton, Vancouver and Victoria, but ratcheted down its expectations slightly for condos prices in Quebec City, Montreal and Ottawa.
Europe’s in a bad way and the Bloomberg editors want pump-priming:
Since the global financial crisis of 2008, the U.S. and the U.K. have seen output grow more slowly than in previous recoveries. That’s nothing to boast about. Still, six years on, gross domestic product is higher in both countries than it was at the pre-crisis peak. Europe’s output remains 2.4 percent below that benchmark. And the gap isn’t closing.
All three of the euro area’s biggest economies — Germany, France and Italy — are failing. Germany’s output actually fell in the second quarter. So did Italy’s, for the second consecutive quarter. (Whether this is a new recession for Italy or a continuation of the old one is debatable.) The European Central Bank currently forecasts a rise in euro-area output of 1 percent this year. Expect that to be revised down next month.
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German policy makers have resisted proposals to loosen the euro area’s agreed fiscal targets. The European Commission has echoed the same line, insisting that supply-side reforms are the key to recovery. This is short-sighted. Europe needs both demand-side and supply-side stimulus — but the first is both more urgent and can be delivered more promptly.
But at least the Canada Pension Plan is making money!
The Canada Pension Plan fund earned a 1.6-per-cent return on its investments in its latest quarter as returns slowed from last year’s stellar gains.
The Canada Pension Plan Investment Board, Canada’s largest pension fund manager, said Thursday its assets grew by $7.7-billion in the fiscal first quarter ended June 30, boosting total assets to $226.8-billion from $219.1-billion at the end of March. CPPIB said the gain consisted of $3.4-billion in gains from investments and $4.3-billion from new contributions.
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The fund said Thursday it has a five-year rate of return of 8.5 per cent after inflation is taken into account, and a 10-year return of 5.4 per cent, which is well above the rate of return required to ensure the fund is sustainable at the current contribution rate. The Chief Actuary of Canada has projected the fund must earn 4 per cent after inflation on a long-term basis to meet funding projections over a 75-year period.
It was a modestly negative day for the Canadian preferred share market, with PerpetualDiscounts down 6bp and FixedResets and DeemedRetractibles both down 4bp. Volatility was completely non-existent. Volume was below average.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.2763 % | 2,636.3 |
| FixedFloater | 4.17 % | 3.41 % | 26,956 | 18.58 | 1 | 0.0000 % | 4,156.5 |
| Floater | 2.91 % | 3.03 % | 45,119 | 19.61 | 4 | -0.2763 % | 2,726.2 |
| OpRet | 4.02 % | -0.89 % | 82,883 | 0.08 | 1 | 0.0000 % | 2,721.1 |
| SplitShare | 4.23 % | 3.77 % | 73,038 | 3.96 | 6 | 0.0727 % | 3,138.0 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0000 % | 2,488.2 |
| Perpetual-Premium | 5.49 % | -2.87 % | 88,233 | 0.09 | 19 | 0.0351 % | 2,437.4 |
| Perpetual-Discount | 5.23 % | 5.19 % | 115,059 | 15.15 | 17 | -0.0603 % | 2,598.0 |
| FixedReset | 4.30 % | 3.58 % | 194,332 | 8.66 | 75 | -0.0409 % | 2,563.2 |
| Deemed-Retractible | 4.98 % | 0.57 % | 106,743 | 0.11 | 42 | -0.0350 % | 2,559.7 |
| FloatingReset | 2.65 % | 2.04 % | 86,660 | 3.83 | 6 | 0.0920 % | 2,522.7 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| No individual gains or losses exceeding 1%! | |||
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| BNS.PR.O | Deemed-Retractible | 95,742 | RBC crossed 44,800 at 26.28. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-09-13 Maturity Price : 25.75 Evaluated at bid price : 26.22 Bid-YTW : -13.59 % |
| BNS.PR.B | FloatingReset | 61,608 | Nesbitt crossed 50,000 at 25.35. YTW SCENARIO Maturity Type : Call Maturity Date : 2018-10-25 Maturity Price : 25.00 Evaluated at bid price : 25.30 Bid-YTW : 2.22 % |
| MFC.PR.E | FixedReset | 56,325 | Called for redemption. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-09-19 Maturity Price : 25.00 Evaluated at bid price : 25.31 Bid-YTW : 1.71 % |
| GWO.PR.Q | Deemed-Retractible | 55,955 | Scotia crossed 50,000 at 25.01. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 25.02 Bid-YTW : 5.25 % |
| TD.PF.B | FixedReset | 55,817 | Recent new issue. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-08-14 Maturity Price : 23.16 Evaluated at bid price : 25.00 Bid-YTW : 3.61 % |
| TD.PF.A | FixedReset | 55,051 | TD crossed 30,000 at 25.35. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-08-14 Maturity Price : 23.26 Evaluated at bid price : 25.34 Bid-YTW : 3.58 % |
| There were 24 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| PVS.PR.C | SplitShare | Quote: 26.13 – 27.13 Spot Rate : 1.0000 Average : 0.8287 YTW SCENARIO |
| IAG.PR.A | Deemed-Retractible | Quote: 23.31 – 23.69 Spot Rate : 0.3800 Average : 0.2595 YTW SCENARIO |
| FTS.PR.H | FixedReset | Quote: 21.05 – 21.50 Spot Rate : 0.4500 Average : 0.3352 YTW SCENARIO |
| CU.PR.E | Perpetual-Discount | Quote: 24.10 – 24.59 Spot Rate : 0.4900 Average : 0.3770 YTW SCENARIO |
| ENB.PR.Y | FixedReset | Quote: 23.91 – 24.14 Spot Rate : 0.2300 Average : 0.1664 YTW SCENARIO |
| RY.PR.E | Deemed-Retractible | Quote: 25.53 – 25.79 Spot Rate : 0.2600 Average : 0.1983 YTW SCENARIO |