To The Pointwith Boris Bozic
Commentary, Opinions, Thoughts and Discussion on Current Events, Politics and The Mortgage Industry

0 Comments Technology Addiction: Smartphones

Article written by on the 30 May 2014 in Technology/Social Media

We’re living in extraordinary times.  The digital revolution is fundamentally impacting every aspect of our lives.  The pace of change is happening at breath taking speed, and I find myself fascinated by the evolution of change.  I think we’re all become somewhat blasé regarding innovation, and it’s not surprising given that “wow” factors are happening with greater frequency.  One thing we take for granted is our smart phone.  Mobile phones have been around for a while, but our dependency on the device grows daily.  I came across a survey that indicated that 96 per cent of mobile phone owners have their device within arm’s reach, twenty four hours a day.  That folks is attachment or addiction if you will.

As for the handle, the smartphone, not sure if it’s made me any smarter.  In some ways it’s made me intellectually lazy.  There was a time when the grey matter between my ears was my Rolodex.  I had a multitude of phone numbers memorized because I had too. Today, I would be hard pressed to come up with more than two numbers.  Why? I don’t have to memorize phone numbers. I push a button and magic happens, the number appears.  If the number doesn’t appear? I ask Siri to find it.  If you own an iPhone you know who/what Siri is.  Siri does a lot of thinking for all of us.  Need a phone number, directions, restaurant name, the weather, the score in the Jay’s game, you name it, she knows it all.  When some other entity does a lot of the thinking for you, well, you stop doing it.  I’m not sure if that’s such a good thing.  I think from now on I’m going to stop referring to it as a smart phone, and start calling it something more appropriate, like the “dumbass phone”.

My reason for thinking about smartphones, and our growing dependency on them, was a result of reading an article about Google developing a self-driving car.  The prototype is a two seater, no steering wheel, gas pedal or brakes.  It’s all powered by computers and is guided by sensors.  The possibilities are mind boggling.  If Google makes the self-driving car a reality it will have a ripple effect that would make Charles Richter, creator of the Richter scale, say “that’s what I’m talking about”.  Automakers, the oil industry, regulators, oh hell, most every business would be impacted.  Some cars today have functions that are automated, but not fully automated.  A fully automated self-driving car would be game changer, for all of us.  Now, you may think this is too futuristic and is nothing more than a bunch of techno geeks creating cools things that will never get off the ground.  That’s what I thought.  Mind you that was six years ago when I read an article that we would become dependent on our mobile phones, and that they would eventually replace our personal computers.

Until next time,


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0 Comments Cash is King

Article written by on the 23 May 2014 in Economy

When isn’t it?  It may not be wise to hide your money under your mattress, but keeping some of your powder dry to seize opportunity is wise.  One never knows when the “next good deal” may present itself so it is always prudent to be ready when it does.  The challenge of course is identifying a “good deal”, and that takes some know-how, and luck.  Some of the best deals I ever made?  The one’s I didn’t make.  I think we all have those.  You look back on opportunities that you passed on and say to yourself, “whew, thankfully I didn’t pull the trigger on that one”.  Of course we all have stories about the opportunity we passed on that ended up being a winner.  Personally, I don’t let those decisions haunt me.  I never lament losing money that I never had in the first place.  But I will say there was a real estate transaction that I passed on that stills annoys me today.  Here’s the Readers Digest version.  A fabulous property was available about three years ago.  The footprint of the house was unique, and the dirt was in a rather exclusive neighborhood, and it was an eye-popping piece of property.  There was no issue of multiple offers because the property had been listed for over sixty days.   That led me to believe the vendor would be somewhat flexible.  I was wrong!  We were about five per cent away on the price, and we walked away from the deal.  That same home would cost me to thirty-five to forty per cent percent more to buy it today.  What bothers me about that deal is not increased value that I missed out on.  It’s that I knew it was a good real estate deal, and I let my ego cloud my judgment.  I should have given the vendor the victory at the negotiating table.  The vendor eventually got what he wanted, and we had to move on to find that next deal.  We did, but it cost us more.  Lesson learned, and we won’t be making that same mistake again.

I thought of that lost opportunity after reading an article in the Globe & Mail this morning.  The Globe reported that sales of high-end home are on an upswing, rather significantly.  Some 754 homes for $1.5M plus have sold in the Toronto market in first four months of the year.  That’s a year-over-year increase of thirty per cent.  So what’s driving high-end home sales?   Intuitively, it’s the reality of the market, and it’s a reflection that buyers that have the resources and the ability to carry the debt if a mortgage is required, they are saying it’s still a good deal.  I don’t mean to sound crass but a $1.5M home today is not what it was five years ago.  I look at property values every day, and when I see a tiny two bedroom bungalow, in an okay neighborhood, on a postage size lot going for over $700k, the $1.5M price tag is not all that shocking.  In desirable neighborhoods in Toronto, you would have to pay well over $1M for a tear-down.  The numbers are relative, and it’s simple as supply and demand.   As for the actual number of transactions in that snack bracket, keep in mind the population base in Toronto.  The largest populated city in Canada will lead in certain categories because of scale.  Also, there’s a lot of money in Toronto, and some of these people do not want to miss out on an opportunity.  I think the number one reason why people with means buy higher end properties, because they can.

Scarcity determines the price of all goods and services.   When it comes to real estate in Toronto, there’s no time for naval gazing.  In April, homes that sold in Toronto, were on the market for an average of twenty days.  In Calgary, the hottest market in Canada, it was thirty four days, tied with Regina.  It doesn’t matter where you want to buy a house in Canada today, irrespective of price point,  time is not on your side.

Until next time,


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0 Comments Interpreting The Numbers

Article written by on the 16 May 2014 in Business,Canada,Current Events,Economy,Merix Financial,US Politics,World Events

Is the glass half full or half empty?  Are the measures that we’re taken to modify the real estate market balanced or have policy makers over reached?  Numbers are supposed to be black and white.  Shades of grey come into play depending on the side of the argument you’re on.

The Canadian Real Estate Association, (CREA) released data this week which will make all sides of the Canadian real estate market argument happy.  Example, according to the MLS Home Price Index, home prices have increased by 7.6% from a year ago.  Now if you take Vancouver and Toronto out of the equation, the increase was 4.6% on a year over year basis.  So are we on the cusp of a potential real estate bubble or is it simple supply side economics?  The number of homes sold came in slightly lower than a year ago.  So is demand outpacing supply, causing prices to increase?  And oh my god, condo sales increased in Toronto as well. Red Rover, Red Rover, Doom Sayers come on over.  There’s a little something for everyone. The teeth nashers and those predicting Armageddon are fist bumping each other.  Others, justifiably so, are saying it’s a balanced market.  Should the price of a real estate never rise? If that we’re the case we would all be squatters, living in tents.  The commentators I love are the ones that sit firmly on the fence.  An economist for one major bank said their analysis suggests that we all experience a 10% decrease in home values, and there could be further risk if sales activity was to increase. They were so concerned with the “risk” that they matched the 2.99% five year rate that one of their competitors came out with.  That fence post must really be uncomfortable to sit on.

Sifting through all the commentary can be confusing, and let’s be honest, depending on the amount of skin you have in the game will influence the argument and opinion you support.  To combat human nature it’s important to seek contrary opinions, and I force myself do that, almost daily.  It takes some effort to find commentary which is not self-serving, like those selling newspapers, hedge funds that are shorting the Canadian economy or politicians playing politics.  Here’s a couple names to look out for when you want broader viewpoint, economists Nouriel Roubini and David Rosenberg.  What’s their bona fide? They predicted the financial collapse of 2008. So what are they saying today?  According to Rosenberg, “Nattering nabobs of negativity – stop knocking yourself out. First, there are a host of reasons why I see inflation rising moderately, and the wage process is but one of them. There is a very interesting development taking place that is not garnering a lot of attention. The U.S. commercial banks are loosening their purse strings. As for the U.S. economy, it is looking as though Q2 real GDP growth will come in close to a 4% annual rate. Why I turned bullish on the U.S. consumer.”  Clearly he’s refereeing to the U.S. Economy, but like it or not, when America sneezes we look for a tissue.  In good times and bad.

Until next time!


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1 Comments All Tax, All the Time

Article written by on the 02 May 2014 in Canada,Current Events

Well, it certainly feels that way.  The deadline to file with Ottawa is Monday, and if it slipped your mind, go directly to the sin bin and hold your head down in shame.  Oh yeah, you should prepared to pay more in penalties if you’re late.  If you’re hoping the CRA (Canada Revenue Agency) won’t notice if you’ve filed or not, trust me, they’ll notice.   May 5th is the day for you to make good with the government.  If you feel this strange sensation of a number in hands in your pocket, it’s real.  Here in Toronto, we all feel like we’ve been groped this week.

A report was released this week about the impact to the Toronto economy due to implementation of the municipal land transfer tax.  For those of you not aware, real estate purchases in Toronto are subjected to a Provincial Land Transfer Tax, as well as a municipal land transfer tax.  The net result is that anyone buying a home in Toronto, will pay the highest land transfer tax in the country.  A study was commissioned by the Ontario Real Estate Association, and the findings are interesting.  According to the report, if the municipal land transfer tax was eliminated, Toronto could see a $2 billion boost to the local economy, and possibly create 12,000 new jobs.  The municipal land transfer tax came into effect in 2008, remember what happened to the global economy 2008?, and our elected officials at that time thought it would be wise to implement  further financial burden on home buyers.  The new study suggests that the city of Toronto has experienced a decline of 38,000 home sales due to the implementation of the municipal land transfer tax, and a $1.2 billion reduction in GDP.  Of course critics of the study say that the report is self-serving because it was commissioned by the Ontario Real Estate Association.  Okay, let’s assume there was some embellishment, and we cut the number in half.  A $1 billion dollar boost to the economy, and 6,000 new jobs created is not trivial or throw away numbers.  The focus should be on the message, and not the messenger.  If you’re of the mind that this is just a Toronto problem, and too bad for them, you may want to rethink that.  Do you think your municipal politicians will be able to resist the urge to go to the real estate trough and impose their own municipal land transfer tax?  If there’s no real backlash by voters in Toronto, and the municipal land transfer tax just slowly becomes the cost of doing business, why shouldn’t your municipal council get some?   If you think it could never happen, I admire your blind faith.  Speaking of faith, I have zero in our current mayor.  It’s not because of the crack smoking, drunken stupors and all round buffoonery.  Who amongst us hasn’t sinned?  I can forgive, but what I can’t forgive is that our rehabbing mayor promised to do away with the municipal land transfer tax, and he lied. Hey, it’s one thing to lie about smoking crack, but when you promised that we could keep more of hard earned money, and you lie, now you’ve gone too far.  Unlike the mayor, the vast majority of Torontonians would invest the extra money in our children’s education, home renovations, vacations and maybe something really outrageous, like increasing their down payment on a home purchase. 

 In fairness to our esteemed municipal politicians, the ability to impose the municipal land transfer tax was granted by the Provincial Liberal’s magic wand.  Granting permission is in keeping with their modus operandi.  Like the new Provincial budget they tabled this week.  The numbers are mind-boggling, and there’s no point getting into the details because it will probably never pass, and the voters in Ontario will be heading to the polls again.  However, the budget does give us a glimpse of the Liberal’s campaign platform.  If they’re looking for a campaign slogan, I can simplify it for them. “Vote Liberal, we’ll spend and tax more”.  It’s kind of catchy.  If you’re bored this weekend, and you feel like doing a slow burn, click on the link to the Fraser Institute Personal Tax Freedom Day Calculator.  It calculates when you stop working for the government, and you start keeping your hard earned dollars.  For all of in Canada, it’s sometime in June, your personal income and the province you reside in determines the actual day.  Wait, there’s one exception, Alberta.  Albertan’s personal tax freedom day falls in May.  I love Alberta, and I have thou$ands of reasons why.

Until Next Time,



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