Credit Crisis, Canada, Real Estate, and Mortgage

Canada Mortgage

First Published Date: May 9, 2015

Canada has not been immune to the credit crisis that has hit the world over the last eighteen months, but there are many inside Canada and out who feel that of all the major developed nations things have been handled better in Canada than anywhere else. This is down, in no small part, to a sense that Canadian banks have had more sensible lending policies and that panic is something that is not a major part of the Canadian psyche. A recent IMF report has said that Canada is actually specifically well placed to handle any further economic crisis and has applauded the $400billion stimulus plan unveiled in January as being the right amount at the right time. In addition, Canada has been recognized as the last country to succumb to the crisis and is expected to be the first to lift itself out.

What this means for those hoping to buy a house in Canada is that there may never be a better time, if you currently have the borrowing power, to buy one. By taking advantage of the effects of the crisis – admittedly something that causes a moral issue for many – one can find some bargains that will begin to increase in price once the clouds start to lift. The question is, where should you go in order to borrow the money it will take to buy? With Canada less marked than other countries by the crisis – but marked nonetheless, no doubt – the banks are more willing to lend to those who can show credit worthiness than banks in other countries.

Before you decide on a mortgage, the first and most important step is to shore up your own position. This can be done chiefly in two ways. Firstly, it is vitally important to save cash for a deposit, or down payment. If you can place this in a high-yield savings account, so much the better. By putting aside more money, you will cut into how much money you have to borrow when the day comes. This can dramatically change how much you have to pay back, and bring a number of properties within your reach that would have been fantasy purchases otherwise. It will take a bit of time to make significant savings, but the base that this gives you and the difference that it makes will be well worth the wait.

In addition, you should live on credit for a while. Yes, you read that correctly, but do not make the mistake of thinking that this is advice to go crazy with your Mastercard. The reason for this possibly controversial advice is actually fairly sensible. If you make purchases on your credit card and pay them off immediately, you build up a strong credit rating. And the people with the better credit ratings get better mortgages. By  paying off credit card purchases the moment they hit your balance, you will avoid having to pay interest, so there is no penalty for use. It’s a more roundabout way of doing things, sure – but it’ll get you into that house quicker! Try to make sure, too, that you do not have high balances on any lines of credit when you apply for your mortgage – this will badly squeeze your borrowing power.

China Real Estate

Real Estate in China

First Published Date: May 11, 2015

As China becomes more and more a part of the global trading economy, it is natural to expect that its increased openness will continue increasing and that its economy will behave similarly to those of other major powers. This is not necessarily going to be the case, not least because the way that an economy behaves, its DNA, and its part in the global economy all depend on more factors than simply China’s entry to the worldwide club. So, currently, we can see that China is seeing major growth in its economy, while other nations labour under a recession or enter a cautious recovery.

The major test of China’s development as an economy will be time. It is only recently that the country has embraced capitalism, and although any interested party could not have failed to notice that it is headed squarely to become the world’s biggest economy by the middle of this century, it would be fanciful to assume that the forty years between now and then will all be smooth sailing. In ensuring that China continues to develop in the present way, it is going to be necessary to have a strong real estate sector, one which is competitive enough to bring in outside investment. Currently, the signs are good for that sector of the Chinese economy.

Looking at the major Chinese real estate companies gives some interesting results. Poly, considered one of its most prominent real estate big-hitters, recently posted its results for the first half of 2009 and, in a year which we should take care to remember has been touched by major recession, showed a massive increase in net profit. Set against the revenues of the first half of 2008, Poly posted an increase of more than 54%, taking its numbers to 8.29 billion yuan (US$1.21bn) and a profit of 1.396 million yuan (US$200m). In comparison with real estate sectors in other countries, China is certainly showing results which point to a thriving real estate economy going forward.

The most definitive question on the Chinese real estate economy, however, remains how it will deal with any bust or recession in the national economy. Perhaps due to the nascent nature of its free market economy, China has not suffered from the global financial crisis in anything approximating the same way as most of its G8 partners. This means that we have yet to see how the country, and the real estate market will deal with it should it happen again any time soon.

However, at this stage it seems only right to give China the benefit of the doubt as to its financial results. Having seen how the rest of the world does free market capitalism and real estate, China has delivered its own approximation of the medium and has shown an impressive level so far. Will this continue? As of this moment it is difficult to say, as we have not seen China’s free market operate under all conditions as we have with the more long-standing free market economies. Those tests are still to come

Although India Is on Track to Becoming the Fastest Growing Economy, It Might Need Another 78 Years to Surpass China

New Visit Begins $22bn New Economic Era

First Published Date: May 21, 2015

China and India may have non-agreed issues from decades of mistrust, but economic cooperation is something these two Asian giants can agree upon. India’s PM Narendra Modi’s recent visit opened up a new economic bridge paved by $22bn to begin a new era of cooperation.

As China’s economic growth starts to slow down, India is expected to overtake China with its growth rate of more than 8 percent to become the world’s fastest growing economy. And China takes notes by not missing to become a partner of the growth opportunity in India.

China has expressed interest in investing in India’s $2tn before, but the progress has been slow due to various political issues on the Indian side. However, at the end of Mr. Modi’s visit to China, both countries signed $22bn deals to boost economic ties, starting with areas such as renewable energy, ports, financing and industrial parks, and so on.

Although India is on track to becoming the fastest growing economy, it has a long way to go to become the next China. China’s GDP is about five times that of India. As a recent Wall Street Journal post points out, India would require 78 years to surpass China at its current economic rate.

Although the new India-China economic cooperation begins a new era, their non-economic rivalries remain strong with no ending in sight. Decades-long border disputes and vying for regional influence to become the regional big brother are here to stay and have no indication of resolving anytime soon.

Taipei 101 – A Landmark Skyscraper

Taipei 101

First Published Date: Sep 5, 2009


In a world obsessed with extremes, and where publicity is king, it is quite something to be able to say that you are at the further extreme of anything. To be the tallest person in the world, although it may have its inconvenient points, is certainly a claim that will entitle you to publicity. Being the world’s richest person will encourage other people to do business with you, ensuring that you simply get richer. Although it is not always universally positive to be able to claim that you are or have the best, the tallest, the richest or the most famous of anything, it does entitle you to certain perks of which recognition is arguably the most powerful. On a worldwide level, having the tallest building in the world certainly puts you front and center in any architectural for um.

As things stand, then, the Taipei 101 tower is a building with a lot to envy. At present – and until at least the 2nd of December this year – the tower remains the tallest building in the world. Standing at 509.2 meters above ground to its highest point, and 139.2 meters to its top floor, the Taipei 101 tower is taller than any other currently habitable building in the world. One tower currently outstrips it in terms of height – the Burj Dubai in the United Arab Emirates – and at present it is not habitable, and will not be until its opening date, currently slated as being in three months’ time. Since its completion in 2004, Taipei 101 has held this title, one which has grown in importance as the world of publicity has gained strength.

It is all the more impressive for the fact that Taipei is found in one of the areas of the world with the highest incidence of typhoon winds and earthquake tremors. The building simply could not have been built were it unable to withstand such conditions, and therefore great care was taken to ensure that this was included in its building plans. As a result, it is capable of withstanding winds of over 130 miles per hour and the strongest earthquakes that the tectonic plates are ever likely to throw at it. innovative engineering was required both for this level of stability and its enormous height – and for any combination of the two.

A lot of the publicity which surrounds the Taipei 101 tower is not to do with its tenants but with its fascinating idiosyncrasies which make for fascinating facts. For example, the name of the tower refers not only to the 101 floors above the ground, but also to the fact that it was built in the first year of a new Chinese century (100+1). Another reason behind this name is that 100 is viewed worldwide as a number of perfection (anything deemed to be 100% is seen as perfect) – the idea being that Taipei 101 goes one better than that. The number eight is seen as a renewal of time, as each week has seven days (the eighth marking a new week). In connection with this and the association of eight as a “lucky number”, the outside tower is made up of eight segments of eight floors. Also interesting is the external design, which features touches of specifically Chinese architecture like the traditional pagodas and ruyi figures.

To streamline and minimize blog maintenance, I will be discontinuing maintaining the realestateexpedition.com website (however, I will still hold the domain). I will gradually move all articles from this site to A Dawn Journal. This article originally published on the above website on Sep 5, 2009.

How Credit Can Be Your Friend

Credit Card Tips

First Published Date: April 18, 2009

There is no doubt that an over-reliance on credit is a bad thing. One has only to look at the mess that the world is currently in to see that the banks’ readiness to lend to people who really should not have been borrowing was unwise. Equally, some of those people doing the borrowing must have been aware that what they were doing carried a huge risk. And yet, if handled correctly, credit can be a way of doing things to your advantage in the long term.

To make credit work for you, you need to keep in mind that risk management is a vital part of the process. As far as possible you need to keep risk out of the equation altogether. You need to keep your interests, your long-term security and needs in the forefront of your mind. Although things like high-value purchases of consumer items may seem hugely tempting, they are to be ignored if there is any chance that they will infringe on your financial security.

So in reading this, you may well be questioning how credit can be your friend at all. The truth of the matter is that credit allows you to spread life’s costs. This is possible without a great deal of risk, because banks will be happy to give good lending deals to people who show the ability to manage credit. And you can do this by living on credit. Don’t worry – this is not as risky as it sounds. It simply involves using the rules to your advantage, and requires discipline (so if you are prone to getting distracted by bargains, do not proceed unless you are sure you can restrain yourself).

The first step is to open a savings account. The best one to go for is one that has either got no limit as to how much you can put in monthly or over a year, or a limit that matches or exceeds your salary. Of the options this leaves you, pick the one with the highest rate of interest. This account is where you want to put your wages each month.

Now, take out a credit card. The experiment ends here if a bank will not give you a credit card due to past borrowing nightmares – but that is probably a good thing. This credit card will be what you use to do your essential shopping. Groceries? On the card. Fuel? On the card. Bills? On the card, if possible. Is this reckless spending? No, it is not because you are going to pay the balance off, in full, before it gets the chance to accrue interest. Most cards accrue interest monthly, but it is not going to be an issue if you monitor your card balance and withdraw from the savings account to pay it off every time a balance appears.

If you do this with a modicum of discipline you will find that there is still money in the savings account at the end of the month, and it is accruing interest. Meanwhile, your credit score is increasing with every full balance payment you make to the card. Not only are you financially solvent, but you are making savings, and have the borrowing power to get the best mortgage possible should you have your eye on a house, or a loan to buy a car. And the savings? They come in very handy if you want to bring down the monthly payments on a loan.

To streamline and minimize blog maintenance, I will be discontinuing maintaining the Canadapersonalfinancewebsite.com website (however, I will still hold the domain). I will gradually move all articles from this site to A Dawn Journal. This article originally published on the above website on Apr 18, 2009.