Dave C. Bonk

OTTAWA — For most Canadians their home is the biggest investment they’ll ever make — but they might be surprised to learn you can use if for more than just sleeping.

People generally don’t think of their homes as a potential pile of cash in the bank, but experts say it’s something worth pondering now that home prices in Canada may have hit their peak.

In fact, analysts say if finance is the only consideration, conditions now and into next year or so form a seldom seen sweet spot for using home equity as a type of asset for investment.

Why might it be a good time to sell?

At about $370,000 average nationally — and just under $800,000 in Vancouver — home prices are already at record levels. Many observers believe prices are long due for a downward correction of anywhere from 10 per cent to 25 per cent, perhaps more in some of the hottest markets.

“Home prices to income, housing price to rent, all the indicators are setting off warning signals,” said Derek Burleton, a senior economist with TD Bank.

“If you are purely in it for reaping profits, now is not a bad time to sell” before prices drop.

The profits from selling a home can be used to build savings, eliminate debt, make traditional investments or, ironically, buy more real estate — albeit in a different market where home prices are lower.

Of course, even if it makes sense financially, selling the family home to rent or move to a less expensive housing market doesn’t make lifestyle sense for the vast majority of Canadians.

Burleton knows how they feel.

“I wouldn’t want to sell my home right now even if I wind up taking a hit on the home price, just because I enjoy where I’m living and moving is a pain,” he said.

While there’s no guarantee of a correction, observers note there are additional signs that the housing market could cool off in a big way.

With ownership levels near a record 70 per cent, demand is expected to wane, making it a buyers market for the first time in years.

And Bank of Canada governor Mark Carney warned last month he was preparing to hike rates, which along with tighter lending rules being applied by federal authorities could trigger a flight from real estate.

In market terms, selling a home at the peak is a way of “locking in” profits accumulated over the past decade of price appreciation — and tax free if it’s the principal home.

Meanwhile, home valuations have been rising far faster than the rent they would fetch since at least 2000. Canada’s home price-to-rent ratio is well above historic norms and among the highest in the advanced world.

That is a hard indicator that homes are over-valued, but also that renting is relatively cheap compared to buying.

David Madani of Capital Economics, who anticipates a 25 per cent price crash over the next few years, cautions that like selling stock shares, timing is always tricky.

“We’re dealing with irrational exuberance. We’ve been treating housing like some magical financial asset that is going to solve all our problems because prices are always going up,” he said.

“Of course, when the turn comes, the over-confidence that drove the market up can turn to fear. You are dealing with emotion … so I don’t believe in a soft landing.”

The market is clearly at or near peak, he said, so soon may indeed be the time to act.

But then again he felt that way a year ago, he points out, and if households had acted on his advice they might not have gotten all the value they could from the premature sale.

Source: http://business.financialpost.com/2012/05/10/would-you-sell-your-home-to-lock-in-profits-before-real-estate-prices-drop/

Who says you can’t have solar power when the sun isn’t shining?

Certainly not SolarReserve LLC, which is building a concentrating solar power (CSP) plant at Crescent Dunes in the Nevada desert.

Not BrightSource Energy and Bechtel, who are developing another at Ivanpah, in the Mojave desert in eastern California.

Not the various government agencies that had to approve the project before a shovel went into the ground.

A CSP plant in Spain has demonstrated the viability of the technology by generating electricity for 24 consecutive hours one day last summer. It has followed up that impressive feat by continuing to produce electricity for an average of about 20 hours a day.

The Crescent Dunes plant will produce 110 megawatts. The Ivanpah project is actually three plants on one large site, and will generate 392 MW.

Both are now under construction.

The first phase of the Ivanpah project should be operating next year, with the second and third phases coming on stream over the next five years. The Crescent Dunes plant should be in production by the end of next year.

These are expensive projects. The Ivanpah plants are expected to cost $2.2 billion and are supported by a $1.375 billion loan guarantee from the U.S. Department of Energy. The Crescent Dunes plant will cost about $1 billion and has received a $737 million loan guarantee from the department.

So how will these plants generate solar power when the sun isn’t shining? In a word: salt.

They will use what has come to be called power-tower technology, which stores the sun’s energy as heat in molten salts. When the sun sets, that heat is used to generate steam to drive the plant’s turbines.

The system consists of hundreds of flat glass mirrors, called heliostats, to concentrate the sun’s rays on a receiver atop a tall tower.

The heat is transferred to immense tanks of sodium and potassium salts, which can reach 565°C. That provides plenty of heat to produce steam for the turbines.

Here are some figures from the Crescent Dunes project. The site covers 718 hectares of land. On it, arranged in a circle around the central tower are 17,000 heliostats.

Each one uses computer drives to follow the sun, reflecting its rays onto the collector atop the tower.

Every heliostat is made up of 25 flat mirrors, all on a steel frame atop a 7.5-metre post anchored in a concrete foundation. The electrical connections involve about 320 kilometres of wire and about 16 kilometres of conduit.

The power tower, of reinforced, slip-formed concrete, is 164 metres tall and 18 metres in diameter.

The receiver consists of 14 panels of tubing that carry the salt mixture. There are two huge holding tanks for the salt, with a total capacity of about 150 million litres.

All this takes space, of course.

The circle of heliostats is about three kilometres in diameter. That means you can’t build them just anywhere. Sunny desert or near-desert locations are ideal.

These projects involve large workforces — about 600 construction people at Crescent Dunes, about 1,400 at Ivanpah, so there are economic benefits to the local areas.

Once in production, the jobs will be far fewer, of course, but the plants will emit almost no greenhouse gases. That’s important because Nevada lawmakers have decided that 25 per cent of the state’s electricity must come from renewable sources by 2015.

In California the objective is 33 per cent by 2020.

There will be a price, however.

Power from these plants will be somewhere around 13.6 cents per kilowatt hour. That will be blended into the rates consumers now pay for power from conventional sources, so there will be a rate increase and some think that’s unacceptable. Others look at it differently. To them, it’s simply an investment in the environment.

Source: http://www.journalofcommerce.com/article/id50096/–sun-shines-on-solar-power-innovation

I want to share this beautiful story with you written by Kent Nerburn:

“Great moments often catch us unawares….”

There was a time in my life twenty years ago when I was driving a cab for a living.

It was a cowboy’s life, a gambler’s life, a life for someone who wanted no boss, constant movement and the thrill of a dice roll every time a new passenger got into the cab.

What I didn’t count on when I took the job was that it was also a ministry.

Because I drove the night shift, my cab became a rolling confessional. Passengers would climb in, sit behind me in total anonymity and tell me of their lives.

We were like strangers on a train, the passengers and I, hurtling through the night, revealing intimacies we would never have dreamed of sharing during the brighter light of day. I encountered people whose lives amazed me, ennobled me, made me laugh and made me weep.

And none of those lives touched me more than that of a woman I picked up late on a warm August night.

I was responding to a call from a small brick fourplex in a quiet part of town. I assumed I was being sent to pick up some partiers, or someone who had just had a fight with a lover, or someone going off to an early shift at some factory for the industrial part of town.

When I arrived at the address, the building was dark except for a single light in a ground-floor window.

Under these circumstances, many drivers would just honk once or twice, wait a short minute, then drive away. Too many bad possibilities awaited a driver who went up to a darkened building at 2:30 in the morning.

But I had seen too many people trapped in a life of poverty who depended on the cab as their only means of transportation.

Unless a situation had a real whiff of danger, I always went to the door to find the passenger. It might, I reasoned, be someone who needs my assistance. Would I not want a driver to do the same if my mother or father had called for a cab?

So I walked to the door and knocked.

“Just a minute,” answered a frail and elderly voice. I could hear the sound of something being dragged across the floor.

After a long pause, the door opened. A small woman somewhere in her 80s stood before me. She was wearing a print dress and a pillbox hat with a veil pinned on it, like you might see in a costume shop or a Goodwill store or in a 1940s movie. By her side was a small nylon suitcase. The sound had been her dragging it across the floor.

The apartment looked as if no one had lived in it for years. All the furniture was covered with sheets. There were no clocks on the walls, no knickknacks or utensils on the counters. In the corner was a cardboard box filled with photos and glassware.

“Would you carry my bag out to the car?” she said. “I’d like a few moments alone. Then, if you could come back and help me? I’m not very strong.”

I took the suitcase to the cab, then returned to assist the woman. She took my arm, and we walked slowly toward the curb. She kept thanking me for my kindness.

“It’s nothing,” I told her. “I just try to treat my passengers the way I would want my mother treated.”

“Oh, you’re such a good boy,” she said. Her praise and appreciation were almost embarrassing.

When we got in the cab, she gave me an address, then asked, “Could you drive through downtown?”

“It’s not the shortest way,” I answered.

“Oh, I don’t mind,” she said. “I’m in no hurry. I’m on my way to a hospice.”

I looked in the rearview mirror. Her eyes were glistening.

“I don’t have any family left,” she continued. “The doctor says I should go there. He says I don’t have very long.”

I quietly reached over and shut off the meter. “What route would you like me to go?” I asked.

For the next two hours we drove through the city. She showed me the building where she had once worked as an elevator operator. We drove through the neighborhood where she and her husband had lived when they had first been married. She had me pull up in front of a furniture warehouse that had once been a ballroom where she had gone dancing as a girl. Sometimes she would have me slow in front of a particular building or corner and would sit staring into the darkness, saying nothing.

As the first hint of sun was creasing the horizon, she suddenly said, “I’m tired. Let’s go now.”

We drove in silence to the address she had given me. It was a low building, like a small convalescent home, with a driveway that passed under a portico. Two orderlies came out to the cab as soon as we pulled up. Without waiting for me, they opened the door and began assisting the woman. They were solicitous and intent, watching her every move. They must have been expecting her; perhaps she had phoned them right before we left.

I opened the trunk and took the small suitcase up to the door. The woman was already seated in a wheelchair.

“How much do I owe you?” she asked, reaching into her purse.

“Nothing,” I said.

“You have to make a living,” she answered.

“There are other passengers,” I responded.

Almost without thinking, I bent and gave her a hug. She held on to me tightly.

“You gave an old woman a little moment of joy,” she said. “Thank you.”

There was nothing more to say.

I squeezed her hand once, then walked out into the dim morning light. Behind me, I could hear the door shut. It was the sound of the closing of a life.

I did not pick up any more passengers that shift. I drove aimlessly, lost in thought. For the remainder of that day, I could hardly talk.

What if that woman had gotten an angry driver, or one who was impatient to end his shift? What if I had refused to take the run, or had honked once, then driven away? What if I had been in a foul mood and had refused to engage the woman in conversation?

How many other moments like that had I missed or failed to grasp?

We are so conditioned to think that our lives revolve around great moments. But great moments often catch us unawares.

When that woman hugged me and said that I had brought her a moment of joy, it was possible to believe that I had been placed on earth for the sole purpose of providing her with that last ride.

I do not think that I have ever done anything in my life that was any more important.

Province leads country in growth in 2011

CALGARY — The boom returned with a bang to Alberta, which was home to the country’s fastest growing economy last year, new Statistics Canada figures show.

The federal agency says real gross domestic product advanced 5.2 per cent in 2011 — the province’s highest economic growth rate since 6.2 per cent in 2006.

Douglas Porter, deputy chief economist with BMO Capital Markets, said Alberta’s growth rate last year exceeded BMO estimates.

“The province is leading the rest of the country by a country-mile in terms of job growth recently, and we’re seeing an echo of that in retail sales as well,” he said. “What’s driving it, simply put, is the strength in oil prices and the rapid rise in production in the province — and alongside of that we’re seeing large population inflows into the province.”

Every province recorded GDP increases last year, Statistics Canada said. Nationally, real GDP rose 2.6 per cent in 2011 after increasing 3.4 per cent in 2010.

“We expected it to be good, but not this good,” said Todd Hirsch, senior economist with ATB Financial.

“With the energy sector firing on most cylinders — the natural gas industry the notable exception — chances are high that the province will enjoy another nation-leading year of growth in 2012.”

Porter said one difference between the province’s boom of 2006 and 2011 is the housing market.

“We don’t have home prices in Calgary and Edmonton going up by 30, 40, 50 per cent a year. Quite the contrary,” he said. “They’ve basically been flat for the last couple of years, but of course they’re starting at a much higher level than they did back then.”

Porter said BMO forecasts Alberta to remain the fastest growing province over the next couple of years as well.

BMO is forecasting for growth of just under 3.5 per cent in both 2012 and 2013.

“So maybe not quite as red-hot as what we saw last year, but still very healthy growth, especially given the fact it’s coming on top of what are already relatively robust conditions,” Porter said.

Read more: http://www.calgaryherald.com/Alberta+economic+boom+back/6529344/story.html#ixzz1tYPsCiU5

As I burn the midnight oil filing my usual 150 income tax returns this spring, a number of changing trends are emerging.

I have also seen people not that far removed from retirement being more than a half-million dollars in debt from mortgages and HELOCs.

ATB Financial notes that “Canada’s collective love affair for real estate doesn’t look to be slowing,” as the country’s seasonally adjusted annualized rate of housing starts hit 215,600 in March, some 17% higher than the previous month, and the highest since the 2008-09 recession. Alberta starts of 35,500 in March marked a 71% increase.

.Bank of Canada governor Mark Carney and federal Finance Minister Jim Flaherty have warned about the perils of wallowing in debt, and Carney has hinted it might be time for the Bank of Canada to raise interest rates to rein in consumer spending and real estate speculation.

That poses a philosophical question: Who, if anyone, should prevent Canadians from financial ruin — politicians, the financial industry, or citizens themselves?

Most banks have been reluctant to be viewed as “the bad cop,” taking away the credit punch bowl just when the party is in full swing, so government has stepped in three times to tighten mortgage lending requirements.

But a recent report by PricewaterhouseCoopers Canada showed 82% of Canadians feel that banks should help consumers manage their borrowing by setting limits. Some 63% said they wanted to reduce their debt in the next year, and 41% of working-age participants admitted their debt loads were too high.

So what will all these well meaning people do with any money they might get from income-tax refunds?

A report by ATB Financial economist Will van’t Veld shows that 60% of Albertans expect to receive a tax refund, 22% think they will owe money, and 19% think they’ll break even.

In the same survey, people showed little desire to use their tax refund for consumption. The largest group, 42%, said they would pay down credit-card bills, more so among young people aged 18 to 34. Some 12% said they would pay down a mortgage.

Of interest, Edmontonians were the Albertans most interested in spending their refunds on vacations.

Another major trend I see this tax filing season is a huge growth in medical expenses.

For the 2011 tax year, single taxpayers, or a couple combined, can claim tax credits on allowable medical expenses that are more than three per cent of one person’s net income, or else $2,052 federally and $2,188 provincially.

Years ago, many people didn’t have enough expenses to make a claim, so they carried forward the expenses, in case they combined with future expenses within a 12-month period to exceed the threshold.

Now, the majority of families, and even far more single people, have enough medical expenses to claim tax credits. Medical insurance premiums are more expensive, fewer expenses are partly or totally covered by insurance, and an aging population has either more medical expenses if they’re sick or is taking out travel medical insurance if they’re healthy.

When I started preparing returns for the public more than a decade ago, perhaps 10% of my client families owned rental property. Now, nearly 40% have at least one rental property, or rent out part of their own home.

One reason is that interest rates have been near all-time lows for an extremely prolonged period. That has made mortgages attractive for home buyers, and financial institutions have opened up to them, causing a booming uptake on Home Equity Lines of Credit, or HELOCs.

Despite the financial crisis all around us in 2008, many Western Canadians continued to hold jobs and prosper, freeing up cash. An aging population, having been out of debt for a few years, was willing to borrow against their future.

With stock markets having gone through a “lost decade” in which indexes wound up where they were 10 years earlier, real estate has become a more attractive investment in many places.

But having a proliferation of rental properties being held by everyday people is cause for concern.

One of my clients bought more than a half-dozen rental resort properties near the Alberta-B.C. border, which was having a building renaissance a few years back. Then the United States housing crisis hit, and many Canadians who used to holiday regularly in the Canadian Rockies tried out U.S. vacations instead, looking to buy depressed property there. Suddenly, Canadian resort rental properties had vacant periods.

Source: Ray Turchansky, Postmedia News

The Moving Calgary

I have Exciting News Everyone!  I have another project set to start at the end of this month…

Here’s a preview:

We will have a website set up to detail my progress and lots of before and after pictures as well!  So stay tuned…

March 2012

February 2012

The shoppers at Toronto’s Blue Banana Market can choose from the wares of more than a dozen merchants, but when they make a purchase, it will be handed over to them in a paper bag.

“When we first started, we made a conscious effort to use 100-per-cent recycled paper bags,” said owner Michael Horwitz, who rents space to merchants in his gift and card shop in Kensington Market. “We wanted to help the environment in that way. We weren’t interested in using grocery store-style plastic bags.”

Yet over the past few years, various studies have indicated that the carbon footprint of the biodegradable paper bag is no smaller than that of its now criticized cousin, the plastic carrier bag. The question has left many retailers in a quandary: Should they offer one or the other, or both?

Research by bodies as diverse as the National Cooperative Grocers Association and the Progressive Bag Alliance have found that plastic bags use less energy and water to make than new paper bags or those with 30-per-cent recycled content. It costs less to transport them because of the enormous difference in weight, and they create less solid waste. Even recycling a plastic bag uses less energy than recycling a paper bag.

Consumers can make a difference by simply buying and using sturdy bags for as long as possible, says Vince Cobb, chief executive officer of reuseit.com, a Chicago company that markets reusable alternatives to disposable items. People can also recycle plastic grocery bags in dozens of ways, including lining their garbage bins with them.

But when it comes to advice for retailers, he admits to being somewhat stymied. “For shopkeepers, it’s a tough call,” he said.

Littering, for example, “is a factor that might give a slight nod to paper,” he said. “It’s in the very nature of plastic bags – they’re so strong and lightweight, they go airborne very easily – to be seen littering our landscape. And they’re used in such massive quantities that we’re seeing billions of these things entering the environment every year. That doesn’t really happen with paper.”

Mr. Horwitz pointed out that his company, which is a member of the Recycling Council of Ontario, uses only bags made wholly from recycled paper, and pays a 30-per-cent premium to do so. “We feel it’s definitely worth paying the extra, because we’re not interested in cutting down trees,” he said.

Other retailers, from Whole Foods Market to the Liquor Control Board of Ontario, are doing the same, offering customers only paper. “It felt like the right decision to offer something that is biodegradable as opposed to something that isn’t,” said Kate Cobb, spokeswoman for Whole Foods, which is based in Austin, Tex. “I always think: What’s going to still be around in a thousand years? And paper may not, but definitely plastic bags will be flying around.”

Municipalities around the world are banning plastic bags, while the city of Toronto passed a bylaw in 2009 stipulating a charge of five cents a plastic bag to help reduce their use.

That has resulted in as much as a 75-per-cent drop in the use of plastic in most major grocery chains, according to figures from the city’s Solid Waste Management Services. An audit of single-family homes also found a 68-per-cent reduction in plastic shopping bags in household garbage going to landfill.

What’s more, many companies are donating the proceeds from the five-cent fee to environmental or other non-profit organizations.

On the other hand, new paper bags raise the spectre of deforestation, effluents from pulp and paper mills and the reliance on fossil fuels to make them, leaving their use much less green than many consumers may think.

And, as Mr. Cobb pointed out, take plastic grocery bags away from people who use them for garbage and they will simply have to buy them.

Meanwhile, Roots Canada has found a way around the dilemma by providing customers with biodegradable or compostable bags. “You want to try to do business in a way that minimizes – we can’t totally eliminate it – our environmental footprint,” says director of communications Robert Sarner. Even the printing on their shopping bags is water-based and lead free.

Rather than throwing up their hands in despair, consumers have options. In Toronto, plastic grocery bags that are not reused can often be recycled as easily as paper ones. Compostable bags can be used for trash going to landfill, since the plastic bags around organic garbage are removed and sent to landfill anyway.

For Bert Archer, a Toronto-based writer who contributed to the book GreenTOpia, the best solution for consumers is no special bags at all. “Just use what you already have,” he said.

Retailers, meanwhile, can share information with their customers.

“I’d say, give out information cards at checkout, saying. ‘This is what the plastic bag does, this is what the paper bag does, this is what the canvas bag does,’” Mr. Archer suggested. “And offer them all, because that’s what stores do. If you want to succeed, you have to give people what they want. But what you can do is inform them.”

By: augusta dwyer
Special to Globe and Mail Update

http://www.theglobeandmail.com/report-on-business/small-business/sb-growth/sustainability/which-is-greener-paper-or-plastic-you-might-be-surprised/article2321160/print/