The pendulum

Derek works in Detroit, lives in a small town east of Windsor. Commutes 160 km every day. Such is the price of love.

He used to have a townhouse in Windsor, but gave that up and moved into his fiancé’s place four years ago. Then marriage. And a baby.  “The commute to work is wearing me down,” he says. “If road conditions are great and the border traffic is good I can do the round trip in 2 and ½ hours; however, typically it is closer to 3 hours and in the winter, well all bets are off.”

So, they want to move closer to his work, back to Windsor. “I know that compared to TO and Vancouver, Windsor prices seem unbelievably low. Houses that my wife and I are looking at are in the $165,000 range, which is less than 3 times my income alone. I know, I know, $169,000 is NOT $700,000 so just man up and buy her a damn house (we currently rent in her home town).

“I just have this nagging feeling that once the housing bubble in the rest of Canada blows and CHMC suffers losses, that home mortgage rules will tighten at CMHC (just like they did in the US at Fannie and Freddie) and in five years the house that I buy now in Windsor for $165,000 can be had for $150,000 or less.

“Is this a realistic fear or am I just overly cautious? Maybe I should fear the Chrysler minivan plant and Windsor casino closing throwing 6 to 7 thousand people out of work in a city of only 209,000 people, that would torpedo housing prices.

“God, maybe we’ll just move to Nunavut, hunt seals, live in an igloo (I can learn to make those) and watch the Aurora Borealis … beats most of the garbage on TV now a days.”

The average house in Windsor costs $169,399, which is up a bit on the year, even though sales are down about 4%. You can buy the average detached, two-storey house with a double-car garage, big backyard and four bedrooms for about $240,000. Last month only 71 of those houses sold, in a city of 325,000 – but that was a few houses more than in 2010. The average income is $78,170, which means the average house costs 2.1 times what people make.

In Vancouver the average family earns $83,130 and the average detached house costs $898,886, which is about 11 times income. In fact, in July in the Windsor area, only four buyers paid more than $500,000 for a property. The Windsor-Essex Country Real Estate Board calls those “high end homes.” In Vancouver they’re called “garages”.

Derek’s letter reminds us that real estate is an intensely local commodity. For example, Windsor has 50% more people in it than, say, Saskatoon – and one hell of a better climate. And yet in Skatch, the average hunk of prairie dirt with a house on it costs $305,419 – or 80% more than in a large southwestern Ontario city.

Why?

Because, like love, real estate’s emotional. It can make you crazy, lose all perspective, and do stuff you thought you could only read about. So people in Saskatoon tell each other houses are valuable and everybody wants to move there and, bingo, they get expensive. Ditto in Vancouver, of course, where the only way families get real estate is by leasing out their furnace rooms to dodgy tenants and borrowing hideously unrepayable sums of money. Then, when most people are fully invested, it becomes a self-perpetuating ponzi scheme. Prices stay sticky even when demand falls because nobody cannot afford to sell for less than they paid.

Sadly, the ponzi does end. It sure did in California, Florida and just about every other US state. This happens when interest rates rise, the economy stutters, rules change, stock markets roil or any other event that turns greed and delusion into fear and loathing. To believe such things will not happen on the prairies, the coast or the godless GTA is what love’s all about. Makes ya nuts.

But back to Windsor (where you can buy a plenty fine apartment building for less than $250,000).

Derek, your town’s the future of Canadian real estate. Under the sway of Detroit and American earthiness, this is what happens once the pendulum swings back from excess to spare. Houses at two times income are as cheap as in decent parts of Phoenix. While other people in other cities have turned real estate from shelter into a futures play, in your city it still means ‘home.’

In Vancouver, Winnipeg, Calgary, Ottawa, Saskatoon or Toronto, distracted homebuyers are forced into taking risk many will buckle under. But in Windsor, the meek shall inherit the earth.

Man up, dude. Buy her a damn house.

169 comments ↓

#1 shanks on 08.30.11 at 9:54 pm

for sure, buy buy buy! if all you are worried about is a 15k loss over 5 years, dont stress it, you will pay more in rent over that time anyways, at least you wont be wasting your life driving back and forth to work.

make sure you get a place with a yard!

#2 Deb L on 08.30.11 at 10:00 pm

I just wanted to say that I look forward to seeing the photo you post, almost as much as I look forward to reading your blog. thanks.

#3 Diane on 08.30.11 at 10:03 pm

I’d buy the house. Even if the value goes down by 10%, so what? In a house that costs $150,000, that’s only $15000. At worst, you cough up a few grand to be able to re-finance (you’ll have paid the remainder of the $15000 during the five years of amortization). Surely that’s worth saving hours a week in a commute and having more time with your family.

Now, 10% in a $1,200,000 house, and even a $700,000 townhouse is a far different matter. That’s what’s going to happen to a lot of idiots in Vancouver who put only 5% down. They won’t be able to come up with the rest when it comes time to refinance at the end of the amortization term.

#4 squidly77 on 08.30.11 at 10:04 pm

With every uptick of 1% in interest rates, prices will fall 8%. So would I buy in Windsor, likely not. A market can not be valued correctly until mortgage rates normalize.

#5 waterloo Resident on 08.30.11 at 10:05 pm

Spending crazy money on homes is wrong but spending crazy money on cottages is okay? Spending crazy money on jewelry is okay? Now lets get to something that will probably hit home to a lot of readers here: how many of you drive an SUV ?

Lets look at our spending habits this way: They are getting us DEEP into debt, really really deep !
When you spend 75% of your pre-tax income on a mortgage then somehow that is supposed to be “unsustainable” here, something close to lunacy, yet somehow buying a huge chunk of metal just so that you can drive one person in a 3-ton rolling tank is okay ?

So now you ask me: “okay Einstein, what are we supposed to do, all drive horses?” Well, if this was Florida then maybe, but we have nasty winters so we need something enclosed, something that can be heated, so a horse or even a scooter just won’t do. So what’s the bare minimum we can get along with? Right now the cars that have the highest mpg are the subcompacts, things like the new Ford Fiesta and Hyundai Elantra get 40 mpg (US rating) on the highway. Yes, a Prius or a VW diesel will get better, but the extra costs of those cars just don’t pay themselves back in fuel savings unless you drive at least 60,000 miles per year, something that most people DON’T do, so the 40 mpg subcompacts are just about the best choice ( The new 2012 Mazda 3 and 2012 Yaris will also be getting 40 mpg Hwy).

So if you think it is crazy to spend so much money on a house, then isn’t it also kind of crazy to be spending so much money on a fuel pig like your SUV you drive to work each day too ????

#6 Best place on meth on 08.30.11 at 10:06 pm

I don’t see anything funny about today’s picture.

What the hell is happening to this world?

#7 waterloo Resident on 08.30.11 at 10:08 pm

Derek, if you work in Detroit then why don’t you live in Detroit? You can buy a house there for as little as $5,000.
Why keep crossing the border just to live in Canada?

#8 waterloo Resident on 08.30.11 at 10:11 pm

(( “Is this a realistic fear or am I just overly cautious?” )) : I think you are overly cautious, WAY too overly cautious. Go ahead and buy a house that costs you only 3 times your income and if for some ungodly reason home prices crash then just declare personal bankruptcy and walk away from your financial debt, its as easy as that.

#9 waterloo Resident on 08.30.11 at 10:14 pm

I just love how you hit the nail on the head with that one: (( “Prices stay sticky even when demand falls because nobody cannot afford to sell for less than they paid.”))

The fact is that here in Canada homes tend to be sticky for decades. Even if ALL demand for homes totally evaporates in Vancouver, home prices will still stay in the Stratosphere just because they are “STICKY”.

No other reason needed, just that.

#10 T.O. Bubble Boy on 08.30.11 at 10:17 pm

Whether Derek buys or continues to rent, he just needs to make sure that he cuts his commute down! Saving 2 hours a day is infinitely more valuable than the $15k one might lose on buying a house in Windsor.

#11 Johnny on 08.30.11 at 10:23 pm

I’m curious as to what you think about the Montreal real estate market. Is it far behind Vancouver and Toronto…or is it a situation all it’s own?

p.s. I love this blog. It’s become part of my daily routine.

#12 not 1st on 08.30.11 at 10:23 pm

Why not buy one of those $1 houses in detroit and bank the rest. NICE!!!

#13 Smoking Man on 08.30.11 at 10:28 pm

PS love windsor Total Rewards card LOL

#14 City Slicker on 08.30.11 at 10:30 pm

Wow 2.1 times household income. Can’t wait for those days again.
Garth when does TREB post August final numbers? Can’t wait to see if the 22% decline will be official.
How can I get household income and avg house price for say, Lethbridge Alberta?

#15 bricklayer on 08.30.11 at 10:31 pm

Garth,
regarding your post a few days back when you eluded to doing seminars in two select cities. How about putting together an investment portfolio for, let’s say, 5 different typical Canadian standard families and incomes/net worth, based on your own and best opinion. I think many would find it useful and all would find it interesting. This could include naming examples of stocks, bonds, ETF’s, etc.
thanks.

#16 jamie on 08.30.11 at 10:31 pm

garth,

this was a great thread today. just felt very real. i’ve been watching the saskatoon market for the past 6 years with absolute amazement, and have basically been resigned to not buy a house (even tho i have little problems affording it…just don’t want to “handcuff” my lifestyle) until things have come back to some selblance of normal. it’s nice to know that places like winsor still exist. in this day and age, people hearing about prices there must think that something is wrong with the place, when in fact there is so much right with it. here’s to hoping that you are so, so, so right in your predictions.

i’ll even bite my tongue and not even utter one “i told you so” to anybody, as long as i can finally buy a really decent house in saskatoon for under $350,000. and i don’t just mean some 25 year old piece of junk on the west side.

keep it up garth, you’ve been quite a blessing to my mental health over the past year. at least i know i’m not totally crazy for thinking similar to you. and if i am crazy, i’m in good company.

jamie

#17 tkid on 08.30.11 at 10:33 pm

Ditto on Shanks’ rent comment. In Windsor, it costs far more to rent than to buy.

Dude, I commuted from Niagara Falls to Toronto and back. I know your commute. It was killing me, the same way it is killing you. Either relocate closer to work and rent, or grow a set and buy the house.

#18 AACI Home Dog on 08.30.11 at 10:38 pm

Dude….what is the commute going to cost you over those 5 years in fuel & vehicle expenses ? Not to mention the time spent & stress caused by the traffic…..

#19 Yul on 08.30.11 at 10:39 pm

Derek,
How about this math: 160km per day assuming a consumption of 10l/100km x $1.25/l x 5 days/week x 50 weeks per year x 5 year=$25000. Plus car wear and tear. Plus the quality of life drag a commute like that puts on you and the family. Real savings verses potential $15000 loss. No debate. Buy the house. Enjoy 10 hours a week of free time.

#20 WI Boomer on 08.30.11 at 10:39 pm

2.5 times your income….BUY a HOME. Dude, have a decent down payment, buy what you can afford. You’re just renting the broad, too., a consideration she may not last as long as the mortgage!! Oh, age obviously showing here, but like my chinese grandmother said, ‘fluck em.’

Yeah, plants may close the economy gets worse, but those problems have been us for eons.

Enjoy the new digs, don’t wear out your car on a nasty commute, and live a little.

#21 Led on 08.30.11 at 10:40 pm

Garth – I know what your next post should be called – Back to the Future – when will the smart money get back into real estate? what should we look for? As much as I love reading your column, I can’t help but be pissed off I didn’t get into real estate circa 1999. I know you say that it takes a generation for this to happen, so are we all going to have to wait until 2025 to buy a house in Vancouver just before it takes off to 3 million?

#22 Bottoms_Up on 08.30.11 at 10:40 pm

ditto….that’s the price of a medium-high end car these days (any made in windsor?).

#23 Gatineau beach on 08.30.11 at 10:42 pm

First!

#24 A Fan in Van on 08.30.11 at 10:43 pm

Jeez. Gimme a break. This guy is crying about the risk of buying a home that is 2 times average income? I could pay cash for two average Windsor homes, but would need to borrow an extra half a million dollars to buy in my deluded town. Grow a freaking pair, dude, and buy a house.

#25 AM on 08.30.11 at 10:47 pm

Great article again. That kind of prices for the houses really make sense. What do you do with the people that bought a house 8 times more and still owe 15-20 years… that’s the hard side of the story.

#26 Christine on 08.30.11 at 10:47 pm

Yes, definitely buy. 300+ hours saved per year is more than worth a potential minor loss…life is short!

#27 EX-Maritimer on 08.30.11 at 10:50 pm

I miss my house in Dartmouth, but each month I enjoy the rent.

I want an apartment building for $250!

#28 martin on 08.30.11 at 10:51 pm

sooner or later real estate in canada will adjust in the expansive cities. but the point is, til’ that day comes there is still a lot of money to be made out there. when you see portugeze constraction fellaz driving brand new BMW than you know there is still a lot of money to be made.

#29 waterloo Resident on 08.30.11 at 10:51 pm

I’ve got a great idea to get rich fast and enjoy the good life for a few years (this is something that me and a friend are actually planning on doing soon !) :

Find a $150,000 house in Windsor and have your lady friend buy it for $150,000. Then go to a bank, borrow $800,000 to buy it and buy this house from your lady friend for $800,000. After taxes and fees your lady friend comes out $500,000 ahead.

Now you do the same thing but only in reverse: Your lady friend gives you some of that cash ($150,000 and you go out and YOU buy another Windsor home that costs $150,000. Now it is your lady friend who goes to a bank and borrows $800,000 and she then buys this house from YOU for $800,000 !

So lets see how you come out ahead here:
- Paid $300,000 for homes + $50,000 taxes and fees = $350,000 in total.
- Borrowed $1.6 Million from the banks.
- Net amount gained from the banks = $1.25 Million dollars !!!

Yes, you will have to make monthly payments on that amount you borrowed, but so what, with that much money you can live like a king for the next 5 years !!!! Then you declare personal bankruptcy and move back with your mother, simple as that. WOW, what a ride , I’ve got to try that !!!!

#30 Phinny on 08.30.11 at 10:52 pm

Derek,

From a born and bred Windsorite, but now living it up in AB – do it. I envy you guys, love the City (you can actually grow tomatoes, man !! ) and think your Mayor is badass. As well, despite the recent downturn, there are a lot of really smart people there- automotive engineers and the like, and Windsor will be back on it’s feet, again.

You’ve got the Tigers, the DIA, the Red Wings and Cedar Point is two hours away and you have the Eastern Market !!! Countless cool things, good schools, it is multicultural (re: interesting !!) and I haven’t, in my life, seen a neighborhood with as much character as Walkerville.

Buy a house. Be happy. Laugh at the rest of us poor slobs, slaving for the man.

#31 Rantanplan007 on 08.30.11 at 10:57 pm

Garth, still unsure why you never talk about Montreal. The strong canadian dollar is killing manufacturing in Quebec. Real estate prices keep going up in Quebec. People there are as emotional as anybody else when it comes to RE. The RBC report for August mentions that Montreal is less affordable than Calgary or Saskatoon. What do you think? You should post an article on that topic at some point.

#32 waterloo Resident on 08.30.11 at 10:58 pm

Yeah, sure its MASSIVE fraud, but just try to hide it for a little while, sweep it under the carpet just like the Asians in Vancouver are doing the exact same thing. One Asian buys a Vancouver house for $1 Million, then his ‘friend’ buys it from him for $2.1 Million. They are working together, and they just ‘gained’ $1.1 Million from a Canadian bank.

Really, who needs to go and rob a bank when you can simply steal all the money you want this way? The ASIANS are doing this exactly as we speak.

#33 City Slicker on 08.30.11 at 10:58 pm

Garth what do you think of the website “foreclosuresearch.ca”
I looked there and all the foreclosed houses look to be normally priced as any listings. Hardly looks like a foreclosure deal.
Looks to be a lot of listing for Calgary, is this an indication that these will be going down?

#34 David on 08.30.11 at 11:00 pm

Windsor offers something like decent fundamentals and this guy is wringing his hands?

#35 Devore on 08.30.11 at 11:05 pm

Sometimes I wonder if the emails are real. This is one of those times.

As real as you are. — Garth

#36 Nathan in Van on 08.30.11 at 11:11 pm

Hey, #29 Waterloo Resident: This one’s for you:

http://www.youtube.com/watch?v=5hfYJsQAhl0&feature=related

#37 Best place on meth on 08.30.11 at 11:11 pm

#9 >Even if ALL demand for homes totally evaporates in Vancouver, home prices will still stay in the Stratosphere just because they are “STICKY”. <

Why? All it takes is for 1 person to sell at a lower price and that's your new benchmark.

#38 Killer Chicken or Imploding Boomer? on 08.30.11 at 11:13 pm

29 waterloo – heres how its done

http://www.cbc.ca/news/canada/calgary/story/2010/05/04/mortgage-fraud-bank.html

#39 Bill Gable on 08.30.11 at 11:16 pm

The stress of long commute nearly drove me insane.

BUY A Home you can afford and save on vehicle expense, not to mention the massive stress of commuting.

This from a dawg that lives in insane Vancouver, where I will not be buying again in my lifetime.

#40 Cabot Lodge brylcreem & trenchcoat on 08.30.11 at 11:18 pm

I’d rent first in Windsor. Gives more time to look around town. Reexamine job security at work and depending on your age the stability of your marriage. See if she can stand this caution and wait. Then consider the plunge.

#41 Tim on 08.30.11 at 11:24 pm

THe average income is not a factor in Vancouver real estate, if it was, 90 percent of the people couldn’t buy houses. Wealthy Chinese and Hong Kong businessmen are the ones driving the prices and buying the real estate, just drive around any neighborhood west of Main street. Even Shaughnessy, the traditional wasp neighborhood is now flooded with Asians

#42 Elmer on 08.30.11 at 11:24 pm

I had a relative in the exact same situation, living in Windsor and working in Detroit. He ended up moving to Livonia, which is a suburb a short drive from Detroit. Definitely don’t live in Detroit, it’s a horrible city. But you can buy a house in some nice suburb for around 150-200k and have a reasonable (< 30 mins) commute to anywhere in Detroit. Definitely no reason to go through the trouble of crossing the border (and paying that toll, what is it now, $4.75?) every day. Plus if your wife gives birth while you live there your kid will automatically get both American and Canadian citizenship.

#43 Tim on 08.30.11 at 11:27 pm

Re #4 Rates havn’t normalized in over ten years, and they certainly won’t in the next few…

#44 Tim on 08.30.11 at 11:29 pm

Why would anyone buy in the Detriot of Canada? The auto industry is not coming back, despite the poor decisions and misguided efforts of our Government

#45 NorthOf49 on 08.30.11 at 11:30 pm

#33 City Slicker

foreclosuresearch.ca is a scam. See below:

http://taxsaleproperty.org/forum/index.php?topic=1346.0

The dead giveaway on so-called Canadian sites like these is their use of US terms eg. foreclosure, HUD, etc.

#46 Kilby on 08.30.11 at 11:33 pm

Penticton, BC, peaches and beaches and wineries.
population 37,721

842 Residential listings including rural and Apex ski hill.

Last 7 days complete sales…..6

One is winery and being sold by “Farm Credit Canada”

The “blush” is obviously OFF.

#47 kdub on 08.30.11 at 11:35 pm

Okay, Windsor – but what about Kitchener, Garth? I’ve been waiting out the market here for years now hoping for a downturn – and prices still keep going up. =/

#48 kiki on 08.30.11 at 11:35 pm

I think Derek had spent too much time in the US….Nunavut has houses, dude. And they’re a lot more expensive than in Windsor.

#49 Kitchener on 08.30.11 at 11:37 pm

Interesting posts, everyone says buy buy buy.
What would happen if he rented in Windsor?
Probably get $150,000 house for rent next to nothing.
Has Windsor hit Bottom? What is bottom.
Maybe time to buy a friend of mine just bought two houses, maybe?
But if a housing crash comes I would think that while Windsor is rock Bottom the lemming instinct will be felt there as well when R/E crashes around the country
Well personally I agree with all the posts above, its a no brainer to move closer to work. Its the rent buy issue.
I am surprised no-one ask how much money do you have as a deposit? $5% 25% 50% 100% might make a big difference in their decision?

Cheers

#50 Timing is Everything on 08.30.11 at 11:49 pm

Man up, dude. Buy her a damn house. – Garth

Wife, kid, 160 km and 3 hours everyday? Does not compute. May as well dive in. Your looking already. Seems you already know what you’re going to do.

Hey, Windsor’s ‘normal’.

———————————————

#13 Smoking Man

Let me guess. Seven Stars?

#51 HouseBuster on 08.30.11 at 11:57 pm

You’re worried about losing 15K on a house. Are you friggin’ serious? You’re wife should be calling you a cheap SOB.

BUY THE HOUSE!

#52 HouseBuster on 08.31.11 at 12:02 am

#7 waterloo Resident – Derek, if you work in Detroit then why don’t you live in Detroit?
——————————————————–
Why do you live in Waterloo?

#53 Off the river on 08.31.11 at 12:07 am

For 15 000 dollars over five years you can get a part time job and still be ahead. Buy! Buy BUY!

Oh, and Garth you orgot to mention all those grow ops in Van helping fund the million dollar mortgages.

(I wonder how much that has to do with the economy)

#54 Hoof-Hearted on 08.31.11 at 12:09 am

Garth….good detail , updates and reminders

Why don’t you post on the other side of the coin, when RE prices hence assessments collapse, and what Local Gov’ts will do?

Are they simply going to adjust the mill rate for the same tax grab, versus a Po’d constituent base losing their jobs and homes…with the X factor of the public servants who literally expect increases the private sector would only dream of as their contracts (…..at least in BC) expire soon?

Who needs zombie movies ?, the same plot is unfolding.

#55 45north on 08.31.11 at 12:15 am

Windsor, I have a nephew there. Twice we went to Detroit for a hockey tournament and passed through Windsor. Seems nice enough but on the way out we went for kilometers before we found the 401.

#56 Hoof-Hearted on 08.31.11 at 12:15 am

Also:

A point was made on VCI blog re strata.

One strata in Vancouver has more proxy voters than resident owners, whereby a major developer appears to be in cahoots with a rep for the proxy-vote (absentee) owners.

In other words, the developers game may be to sell to offshore, knowing they are absentee, or work in cahoots to control the resident strata owners.

This benefits the developer in the sense that absentee owners are often cheap,ie simply parking $$$ or speculating, thus won’t approve higher fees or do necessary maintenance and repairs,hence letting the developer off the hook.

#57 Hosehead on 08.31.11 at 12:17 am

I predict that house will cost about the same in 30 years.

#58 Debt's Dark Embrace on 08.31.11 at 12:17 am

Hey Garth, this guy has a great idea.

#15 bricklayer on 08.30.11 at 10:31 pm
Garth,
regarding your post a few days back when you eluded to doing seminars in two select cities. How about putting together an investment portfolio for, let’s say, 5 different typical Canadian standard families and incomes/net worth, based on your own and best opinion. I think many would find it useful and all would find it interesting. This could include naming examples of stocks, bonds, ETF’s, etc.
thanks.

#59 Nostradamus Le Mad Vlad on 08.31.11 at 12:18 am

-
Derek, see #40 Cabot Lodge brylcreem & trenchcoat — I second that! BTW, pic is cute.
*
Irene vs. Banks – Banks win; Teetering Eurozone banks are headed down, and will take NAmerica with them; The last act of a broke nation (any) is to loot the rest of citizens’ money; 23:40 clip Austrian economics; – is it better than Keynes? Gold Coin Face value US$20.00, market value US$7.6 mln.

Strange “If the EU goes belly up and Chavez starts a run on gold . . .” — Good point. Russia and Venezuela began exploratory talks a while back on an alternative to the US$, so what if . . .; Oz Deflation, Eurozone and 4Closures in NY and NJ; Italy Mint yer own money! BoA Throw in another lawsuit; Ten Lessons from folks who lived thru the depression.

0:43 clip Lone monkey defeats soldiers (sort of); VA Nuke Plant Tritium trouble? and Anomalies “. . . of the dozen or so earthquakes that I’ve experienced, including a powerful 6.2, all of them started gently . . .”. A nuke explosion to kickstart the ‘quake may be more accurate; Fukushima 34 areas top Chernobyl, and Radiation spreading; Acute Leukemia 40-year-old man dies one week after working in Fukushima; Trophy Hunting NATO style liberation; Monsanto Not very good at protecting itself; Muslims support Obama in the US, which bodes well for next year.

Black Hole swallowing star (kinda like the west), and 1:36 clip; FF due? It’s been a decade since 9-11, or next year; Kremlin’s fear of China? Could be why they cozying up to each other, plus Venezuela and a few others.

#60 Hoof-Hearted on 08.31.11 at 12:20 am

I agree re Detroit as an option:

Saw a YouTube clip that showed a neighbourhood coming back to life….

People were buying houses (obviously cheap), off the grid and converting to solar power etc.effectively restoring the old amenities and creating “homes” instead an investment, and also creating communities.

Looks promising as are most things that are seen as opportunities after the SHTF.

#61 Patrick on 08.31.11 at 12:27 am

#32waterloo Resident on 08.30.11 at 10:58 pm

I agree that this is exactly what the asians are doing in Richmond, West side of Vancouver and now North Vancouver.

My asian realtor says there is a group of investors buying up homes in one area. Then they get a huge group of people together to stage a bidding war to up one house to over 50%-75% over the asking price. Once that pumped up house is sold all the other houses that they own in that area just went up the same amount. Then they sell for a profit and move to a new area which is why so many houses being bought by asians are VACANT. They’re flipping them.

Few are acknowledging this and most are dimissing it as a “Rumour”. Our Gov’t and police are too busy catching the Stanley cup riot criminals to pay attention to this issue so we’re pretty much screwed.

#62 Observing on 08.31.11 at 12:44 am

I don’t know if there is anyone who can put this blog out of business other than Mark Carney.

#63 Burnt Norton on 08.31.11 at 12:50 am

Gee, Waterloo resident, yer sum good with the numbrs. I gotta tell ma long lost uncle in Nigeria about that plan of yers. Wut a swell way ta double down on ma oil fortune inheritance he sez I got found over there.

#64 RoninBC on 08.31.11 at 1:03 am

oh oh. Vancouver has dropped to the third most liveable place on earth.

http://www.thestar.com/news/canada/article/1046774–vancouver-loses-its-bragging-rights-as-most-livable-city?bn=1

watch the bubble burst now!

#65 Echo on 08.31.11 at 1:07 am

I think Waterloo Resident drinks more than Smoking Man.

#66 Aussie Roy on 08.31.11 at 1:31 am

Aussie Update

Delusion still alive and well with the average Aussie mega mortgage mug.

MORE than four in 10 Australians (42 per cent) believe that house prices will rise in the next year, while 38 per cent predict they will remain flat and 15 per cent expect a fall.

http://www.theage.com.au/business/most-expect-house-prices-to-rise-over-five-years-20110830-1jk38.html#ixzz1Wa5xmdHa

Its all good news – LOL.
National house prices accelerated their falls in July amid uncertainty about the global economy and the direction of interest rates, with prices in Melbourne leading the drop .

http://www.theage.com.au/business/house-prices-extend-falls-in-july-20110831-1jkvh.html#ixzz1Wa6Leerl

Banks, job losses and falling house prices.

Various tallies put the losses at more than 100,000 staff at investment banks around the world and Australia is not immune to one of the sickest markets in living memory for activities like mergers and acquisitions and capital raisings, The Australian reports.

The big four retail banks are also starting to look to their staffing levels as the housing market softens.

http://www.news.com.au/money/banking/job-losses-start-to-bite-at-investment-banks/story-e6frfmcr-1226126148932#ixzz1Wa6iUaUR

#67 Rob now in Nova Scotia on 08.31.11 at 1:36 am

Derek, why are you driving across the border everyday? Have you considered moving to Ann Arbor where most of the auto execs live? Buy a house there for half of what they cost in Canada, enjoy the cheaper gas and food in the US (ours is more expensive to pay for our “free” health care) and enjoy a bonafide tax deductible mortgage.

#68 Tony on 08.31.11 at 1:50 am

It’s simple home prices in Windsor will drop around ten percent about the same as what prices in PEI will drop. Vancouver will drop around 65 percent and the Toronto area about 40. It’s simple it just depends on what city you live in.

#69 poco on 08.31.11 at 1:50 am

#36 Nathan in Van

well said !!!!!!!!

#70 Mr Royale with cheese on 08.31.11 at 1:58 am

Eat the Cheezburger and shutup or pray the lord your soul nor take.!

#71 Tony on 08.31.11 at 2:05 am

#38 Killer Chicken or Imploding Boomer?

The banks can never win a lawsuit like this one. I thought the same thing up many years earlier. Even today you can sell a house in Alberta to a “friend” at a grossly inflated price. The “friend” puts down the minimum the seller pockets say 25 percent more than what the house is worth. The “friend” simply stops paying the mortgage and walks away leaving the bank on the hook. The seller pays the “friend” say a ten percent premium on a half a million dollar house say 50 grand. The “friend” gets his/her credit rating back in 7 years’ time and probably didn’t have much to lose in the first place. Since there is no capital gains tax in Canada on a principle residence everyone except the bank wins. The residents of Alberta are obviously clueless when it comes to making money or this would’ve taken place a long time ago.

#72 Harry in Saskatoon, no bust here on 08.31.11 at 2:09 am

Garth,
Saskatoon will not experience a drop, maybe flatline, but no drop. Why?

-Low unemployment
-Strong economy
-Fastest growing city in Canada
-Cheap real estate compared to most of Canada
-And one big reason-emotions, which you touched on.

Saskatoon has the fortune of huge demand of our resources from emerging economies but low interest rates because the national economy is not doing so well. A win, win for home buyers here.

One of the big reasons why you have been wrong in 08,09,10 and this year about real estate is the psyche and emotions of people. Because many investors are not diversified, they have gotten creamed in the stock markets. Along with sensationalism of the media and bumbling politicians around the world, the everyday person sees the stock markets as too risky. Some even say it is a casino.

But they are going to put their money some place. So they turn to old faithful. Real estate. Yeah, gold and silver are nice, but to the average person, real estate is THE stuff. It has done remarkably well through volatile times. That is why the emotional aspect of real estate is even stronger now than it was 3 years ago.

It is the reason why people feel safer leveraging $25,000 20 times for a house compared to renting and letting that $25,000 grow in a balanced portfolio.

These are not rational times, that is why graphs and numbers mean very little at the moment. I have no doubt you will be right one of these years, but it ain’t gonna be 2011.

#73 Jody on 08.31.11 at 3:42 am

Buy a home in Windsor. I constantly look at the MLS listings for that city and I live out in Calgary! You can get a VERY nice house in Windsor for $100,000, a house that would cost $700,000 in Calgary. It’s nuts, just nuts. The one thing I would look at is how secure is employment for the two of you, if things look pretty good then buy, I don’t think houses in Windsor are goin to come down much more. Maybe a $30,000 shave on a $120,000 house but I think that would be an extreme case. Here are some I think are nice, my taste can be questionable. I don’t have a clue about some of the neigghbourhoods but I’m sure some of the lower priced ones go low for a reason. It seems the closer you get to the water the cheaper things get, does it give off a toxic mist or something?

http://www.realtor.ca/propertyDetails.aspx?propertyId=10828535&PidKey=1712226323

Here’s a revenue property – two long term tenants

http://www.realtor.ca/propertyDetails.aspx?propertyId=10841272&PidKey=-163678766

another

http://www.realtor.ca/propertyDetails.aspx?propertyId=10923522&PidKey=1200363731

Nice solid houses, most made with bricks instead of cheap ass plywood.

http://www.realtor.ca/propertyDetails.aspx?propertyId=10317591&PidKey=-1360512690

http://www.realtor.ca/propertyDetails.aspx?propertyId=10714097&PidKey=1667417152

So in Calgary, the place below would go for at least $1.3 million, at least.

http://www.realtor.ca/propertyDetails.aspx?propertyId=10995525&PidKey=1659910033

Nice, nice, nice. I’d buy the one below, looks like the neighbourhood is good as well. If you do get stabbed you’re right by a hospital. I wonder if the electric has been updated in the past 60 years.

http://www.realtor.ca/propertyDetails.aspx?propertyId=11054164&PidKey=327525957

#74 Ryan on 08.31.11 at 3:43 am

Windsor is going to do well over the next 5 years too because the construction of the DRIC parkway and border crossing is going to create thousands of jobs.

#75 Jon in Cowtown on 08.31.11 at 4:00 am

Derek:

My advice such as it is, happy wife — happy life!! Three hour commutes not good on wife front, buying house in a market where you have no idea where the bottom lies …. equates risk. So remember this famous truism uttered by Jack Nicholson in “As Good As It Gets” when as Melvin Udall, the author, his publisher’s secretary asks him: “How do you write women so well?”

He answers: “I think of a man, and I take away reason and accountability.” Such is the challenge faced by all men when faced with their wife’s house lust. So Derek, rent a house in Windsor until the market settles, if possible with stainless steel appliances, marble counter tops and a hot tub out back … happy wife … happy life but you’re still accountable!

#76 Jon in Cowtown on 08.31.11 at 4:27 am

Yes my previous post is sexist and I know nothing of Derek’s partner’s preferences and predilections. Nevertheless, there are many of us men who would never have bought a home if it were not for our dearest. Doing so was a wise move in an ever inflating RE market, not doing so is a wise move in a deflating market but if you’ve got money to burn, by all means make her happy.

#77 timo on 08.31.11 at 4:53 am

http://theautomaticearth.blogspot.com/2011/08/august-30-2011-europe-squanders-its.html

“At about the same time the housing report came in, US consumer confidence was reported thusly: “The Conference Board’s index slumped to 44.5, the weakest since April 2009, from a revised 59.2 reading in July [..]. It was the biggest point drop since October 2008.”

Luckily (?!) the US isn’t alone: “European confidence in the economic outlook plunged in August by the most since December 2008 as a persistent debt crisis roiled markets and clouded growth prospects. An index of executive and consumer sentiment in the single-currency region fell to 98.3 from a revised 103 in July [..] ”

European stock markets didn’t even notice. Only Frankfurt was down. The idea seems to be: Consumers, who needs consumers? Sort of reminds you of the days of old, when “jobless recovery” was all the rage. Not so much now”

ah, I smell a very painful recovery.

#78 timo on 08.31.11 at 5:01 am

http://globaleconomicanalysis.blogspot.com/2011/08/first-time-foreclosure-starts-near-3.html

“The Foreclosure Pipeline in New York is 693 months (over 57 years) and 621 Months (over 51 years) in New Jersey! ”

If your planning on investing in US r/e think about the shadow inventory first!

#79 Utopia on 08.31.11 at 6:40 am

#39 Bill Gable on 08.30.11

“The stress of long commute nearly drove me insane”.
————————-

Man, can I ever agree with that, Bill.

I have also done the long commute and it is not worth it. You leave home, forget something essential and next thing you know you just added another 30k to the vehicle.

That might just be the deal-breaker in my books anyway. This commuter guy will actually kill off two vehicles in five years (assuming he trades them in at 100,000 km).

How can that possibly be worth it when you add in fuel costs, the inevitable breakdowns in the middle of nowhere, towing, wasted time, extra servicing etc, etc?

People who have long commutes must hate themselves.

#80 Utopia on 08.31.11 at 6:57 am

Now, despite the fact houses seem like a good deal in the Rust-Belt, I think Squidly made a good point right off. Interest rates have not started to rise yet but it is most certain they will.

That means that even good deals can still get better. Even in Windsor.

Personally, I would not buy there right now. Income versus cost aside we are still looking at only the very beginnings of the housing deflation in Canada. None of us knows how that will play out or for how long. One thing we can be sure of though is that almost every city will eventually be affected.

To my mind Windsor is not special just because it is currently cheap and on-sale. The reason that cities prices have dropped so much is because business activity has fallen and the automakers are still in contraction.

Honestly, I would not buy now. Not even there. The national economy is contracting, our real estate market is perched on the edge and we are within a whisker of a fresh recession.

None of that is jobs-positive. Windsor is out for me. Rent it and wait.

#81 bigrider on 08.31.11 at 7:23 am

“Vancouver 3(third) most livable city in the world and Toronto as number 4″. Source The Economist magazine, a highly influential publication in the U.K.

Really? Third and fourth? I just don’t get it. I live in T.O. We have the dubious distinction of the longest commute times in North America, most expensive toll roads, an infrastructure 50 years behind including a woefully inadequate public transport network.

Could reports like this be influencing the ‘we are different’ mantra and hence the rising RE values against all odds ?

Seriously, what are your thoughts on this Garth? Anyone?

#82 T.O. Bubble Boy on 08.31.11 at 7:37 am

For those who are invested in China, you may want to watch the Chinese Banks:

Fitch warns Chinese Banks on infrastructure facility loans.

Social Security Fund of China is selling Chinese Banks

Hmmm… so, the Chinese Government (which obviously would have insider information on these banks) is selling, and Fitch is saying that bad loans to local governments may be under-stated by 4x.

#83 debtified on 08.31.11 at 7:43 am

#35 Devore on 08.30.11 at 11:05 pm

Sometimes I wonder if the emails are real. This is one of those times.

***********************************************

Amen.

I don’t think Garth makes them up. I just can’t believe someone will actually ask such questions. Unless, of course, they are just pulling Garth’s leg.

I am more wondering why of all the, what I can only imagine, hundreds or thousands of emails Garth gets, he uses this one. There’s gotta be other emails that are more real and actually worth reading, that merits analysis, in his Inbox. If this is the best he’s got, I don’t know how he keeps his sanity.

But then again, maybe the email is just an excuse for Garth to say that, in certain circumstances, it is okay to buy a house in certain places in Canada.

I chose this note as it opened the door to a look at the juxtaposition of psychology and location. Windsor is an interesting market which should cause people elsewhere to seriously reassess. I regret it bored you. — Garth

#84 T.O. Bubble Boy on 08.31.11 at 7:46 am

Here is waterloo Resident’s ultimate dream — HELOC fraud:

Police: Renters pose as owners, steal home-equity cash

#85 Utopia on 08.31.11 at 8:09 am

#42 Elmer

“Definitely no reason to go through the trouble of crossing the border (and paying that toll, what is it now, $4.75?) every day.”
—————————–

What? There is a toll too? So I am guessing that you pay it both ways meaning that adds almost ten bucks a day to the commute.

So lets get this right.

Derek burns out two vehicles over 5 years of driving.
He pays a huge premium for fuel and vehicle maintenance in excess of what any other typical person pays. He loses almost 15 hours per week of his life just by driving (that is nearing two full working days) and then he gets punished with a toll that could be costing him upwards of two grand or more annually.

What else? Strip searches at the border? Tax consequences on both sides of the border? It cannot be worth it.

Derek needs a solution. His life is out of control.

#86 Aussie Roy on 08.31.11 at 8:13 am

Aussie Update

An elderly couple are in danger of losing their family home because of a disastrous property investment bought from a sales company that calls itself The Investors Club.

http://www.jenman.com.au/news_item.php?id=424

Australians have cut back on personal borrowing for a fourth straight month in July, while annual growth in home loans was the slowest on record

http://www.theage.com.au/business/home-loans-grow-at-slowest-pace-on-record-20110831-1jl20.html#ixzz1WbjiZUSQ

BRISBANE homeowners have suffered the greatest property price falls in the nation, new figures show.
The RP Data-Rismark Hedonic Home Value Index, released today, showed the value of dwellings in Brisbane dropped 0.4 per cent in July to a median price of $420,000, seasonally adjusted.

The fall brings the total decline in the city’s property prices to 6.6 per cent over the past 12 months – the worst in the country.

http://www.news.com.au/money/property/brisbane-homeowners-suffer-greatest-losses-in-australia/story-e6frfmd0-1226126607452#ixzz1WbjtqsjZ

HOME prices in Australia’s capital cities have fallen by 2.9 per cent over the past year as consumer caution, financial market volatility and poor business conditions outside the resource sector impacted sales.
In a further sign of soft market conditions, the average time it takes to sell a capital city home has risen to 55 days from 45 days a year ago.

http://www.news.com.au/money/property/house-prices-fall-further-in-july/story-e6frfmd0-1226126455417#ixzz1Wbk53okm

#87 Mr. Lee on 08.31.11 at 8:16 am

Good Article,

All assets regress to the mean, good for Windsor to realize this sooner than Calgary.

Home prices have doubled while real medain after tax income has gone up by 10% over the same time period. Can anyone say psychology.

Even if the BoC keeps interest rates in line with what Benny B is doing, head line, core and real inflation rates will do to housing prices what Mr C does will not.

Remember, homes are paid for on what is left over after the tax man helps himself…….that is a realization that many Canadians have yet to learn.

#88 Aussie Roy on 08.31.11 at 8:34 am

Aussie Update

Melbourne, most livable city, yes thats right Folks, BPOE has Koalas, well atleast being BPOE will stop the POP, right, lol, think again.

This is the city from the “Block” TV series, you remember the most advertised auctions of the year where only 1 of the 4 houses sold. Same city where prices are falling and stock for sale is rising.

http://www.smartcompany.com.au/property/20110823-eight-lessons-to-learn-from-the-block-s-lacklustre-auction.html

Most livable city results.

http://www.thestar.com/news/canada/article/1046774–vancouver-loses-its-bragging-rights-as-most-livable-city?bn=1

PS. BPOE, please change your user ID to 3RDBPOE – LOL. So if the most livable city in the world, Melbourne can have falling house prices, then why can’t it happen anywhere there is a debt fuelled bubble?. Let me guess, because its different in xxxx.

#89 The American on 08.31.11 at 9:01 am

#81: Bridger, frankly, most nobody gets it. But, if you read Monocole (another credible source for quality of life surveys also from the UK, but founded by a Canadian), it has a completely different ranking and criteria of world cities. Quickly, Monocole is becoming the “gold standard” for these kinds of lists. Munich takes #1 spot (and rightfully so, IMO), Zurich is #3, and Tokyo #4. Vancouver shows as #16, which is certainly more realistic (BPOE, my ass – Nice, but nowhere near the BPOE. If you think it is, you really REALLY need to get out more). Toronto doesn’t even make the list for its top 25 (which makes sense to me). It all depends on how these surveys are made (oh yes, and who’s padding the pockets at the source). Mercers also has a completely different cast and rank of cities, as do many other publications.

Vancouver DOES, however make a near-top list of Forbes “World’s Most Overpriced Cities” list. This isn’t anything to brag about. Seattle made that list also for a few years. Well, then we realized they were right. Things always correct and return to the mean. Always.

#90 T.O. Bubble Boy on 08.31.11 at 9:06 am

$165k for a full HOUSE in Windsor

vs.

$980k for this boring 1200 sqft Cityplace condo in Toronto:
http://www.realtor.ca/propertyDetails.aspx?propertyId=10965558&PidKey=-36623136

Anyone who calls the offshore buyers of these places “investors” is obviously not familiar with the concept of investing.

#91 Steven Rowlandson on 08.31.11 at 9:17 am

On the contrary! Be a real man and don’t get whipped into buying what you can not afford!
Be a master of your destiny and finances and not a slave to other peoples whims and whining.

It’s called marriage, and is a compromise. You will understand his when you develop secondary hair. — Garth

#92 EdmontonJim on 08.31.11 at 9:34 am

Also, what is that commute costing? Even ignoring the time wasted, it must be hundreds of dollars each month.

#93 Daisy Mae on 08.31.11 at 9:37 am

bricklayer on 08.30.11 at 10:31 pm “Garth,
regarding your post a few days back when you eluded to doing seminars in two select cities. How about putting together an investment portfolio for, let’s say, 5 different typical Canadian standard families and incomes/net worth, based on your own and best opinion. I think many would find it useful and all would find it interesting. This could include naming examples of stocks, bonds, ETF’s, etc. Thanks.”

**************************

In your dreams…. LOL

#94 Deano on 08.31.11 at 9:37 am

I feel better reading this post. As I’ve posted before I live in Brantford…higher real estate than Windsor but not by a lot.

My question is…I’ve got a 200k mtg (1.5x our income). Do I crush it and pay it off in 6 or 7 years or do I balance it out more and pay it in say, 12? I wouldn’t be paying it off to sell it and make the money….I’d be paying it off to live mtg. free. Taxes are only 150/mo right now so I figure life would be easy. We have no plans on moving in the next 20 years (unless we win the lotto…which we don’t play, so that’s settled). Weigh in please!

Depends on the rate. If it is a prime-minus, (below 3%) then hang on and invest the money in assets paying more. Then reduce the principal upon renewal. If the mortgage rate is higher than 4%, it makes more sense to pay it down faster. — Garth

#95 BrianT on 08.31.11 at 9:43 am

#81Big-Those lists are so ridiculous they are almost beneath comment. I assume they are attempting to inform the reader that most large cities are dumps circa 2011-I know quite a few people that have lived in TO for 35 yrs or longer and I have yet to meet one that thinks that Toronto circa 2011 is a superior product re quality of life to Toronto circa 1976. Everything is either more crowded or more expensive for the same service or quality. A ride on the Yonge line circa 1976 would seem like white glove treatment for a TTC patron of 2011 (just one example)-no point even mentioning the traffic congestion.

#96 Moneta on 08.31.11 at 9:47 am

#83debtified on 08.31.11 at 7:43 am
#35 Devore on 08.30.11 at 11:05 pm
——-
Reality is usually stranger than fiction.

That’s why there are still so many bulls out there. They don’t understand how complex most peoples’ lives are.

#97 Kilby on 08.31.11 at 9:51 am

Victoria, price changes in residential listings July and August. Victoria and all surrounding municipalities, excluding the Gulf Islands.

July. 479 changes
August. 701 changes

Maybe sellers are getting the message….finally!

#98 BrianT on 08.31.11 at 9:54 am

#75Jon-The guy is a nut. He is commuting from the middle of nowhere so that he can possibly save 15 or 20 grand off the purchase of the house she wants (after 5 yrs of her waiting).

#99 waterloo Resident on 08.31.11 at 9:55 am

#47 Kdub:

(“Okay, Windsor – but what about Kitchener, Garth? I’ve been waiting out the market here for years now hoping for a downturn – and prices still keep going up. =/”)

Sorry, but prices in Kitchener will NEVER come down again, somehow we have turned into the new ‘PARIS’ of the world and soon our home prices will be $100 Million for each and every house.

#100 refinow on 08.31.11 at 9:56 am

People that suggest to move to Detroit and buy a $1.00 home and bank the rest…

Shake your heads…

The mayor of Detroit has been discussing the possibility of bulldozing 1/3 of all the home in Detroit. Most of the stores, schools, and basic services have shut down as well.

If he moved to Detroit he might have to drive back over the boarder to buy diapers…

The $1.00 homes have been completely gutted of every fixture, furnace, kitchens and any piece of copper wire or pipe that could be sold for scrap.

I think Detroit is the extreme example of the pendulum swinging far to the left. The city is in serious distress, however GM just announced the new 2013 Chev Malibu is going to be built in Detroit, so maybe a siver lining in one of the grayest clouds in the US.

Derek has a problem because his wife’s family is living where they currently rent, and moving away from the family will change the current family dynamics..

I think renting is still the best solution for Derek, because if he moves to Windsor, and to only find out he could be losing his job in Detroit, his ability to relocate is much easier.

It is likely he has very little for a down payment, so even if the $15000 drop occures, (I think that on the conservative side) he is locked in his house with a mortgage higher then the value of his house…

Derek, stick with your gut…. RENT…. A nice house in a nice neigbourhood, there are some nice suburbs outside of Windsor and would place you a little closer to your inlaws.

And sit back and watch the carnage…

Just came back from Florida, and it is not a pretty site… Nothing is moving…. Prices keep dropping….

#101 BrianT on 08.31.11 at 10:00 am

#44Tim-Windsor is definitely not the “Detroit of Canada”-the city had 0 murders in 2010 and is on track for 0 murders for 2011. In Detroit, 70% of the murders are not solved by the police-great town to kill anybody.

#102 Dad on 08.31.11 at 10:02 am

Son, nothing is worth losing hours of time every day that you could spend with your child.

#103 Hoser on 08.31.11 at 10:03 am

DELETED

#104 waterloo Resident on 08.31.11 at 10:06 am

#38 (Killer Chicken or Imploding Boomer?): Thanks for the link to the article about the mortgage fraud, that is EXACTLY the type of information that I need so that I can go out and commit the EXACT same type of highly illegal and criminal activities too !!!

Unfortunately, I’m a native born Canadian, I cannot just move my butt up and fly back home to the foreign countries the way those other guys did, so what I need to do is create a scheme that does sort of the same thing but is 100% LEGAL, and won’t end me up in the slammer. Their system was okay but sloppy.

The biggest help from that article was the information about how banks rely on software programs to determine house prices by neighborhood, that means that I am going to have to buy run-down $40,000 shacks in Windsor, hire a few lawyers / appraisers / RE-agents as my partners to make up the fake legal paperwork, and then sell the houses to one of my other partners for a much higher price, somewhere around the normal going rate of $170,000.

Now I just have to figure out how to do this 200 to 500 times over the next few months?

#105 waterloo Resident on 08.31.11 at 10:13 am

You know, the legal system here in this country TOTALLY SUCKS as far as catching white collar criminals. If you buy homes and flip them and somehow scam the banks out of $Millions then you can almost be sure that you WON’T be going to jail because it is far easier for the bans to simply get their money back from CMHC than from the courts, so that’s what they do.

Meanwhile, all the guys who do what I’m thinking of doing walk away and enjoy their life. So everybody; get off your butts and do the same thing that I just told you how to do it, don’t just think about it, get moving and get rich through legal fraud. Why wait?

#106 refinow on 08.31.11 at 10:33 am

I do agree with Garth that certain real estate markets have less potential for catostrophic meltdowns than others, however I find it a little surprising that he abandons his most basic of idealology of having all your eggs in one basket, for a young couple who’s entire net worth will be tied up in their home.. (I DONT AGREE)
This is still a very risky period of time and to suggest that Derek falls back on the “HAPPY WIFE….HAPPY LIFE” cliche…. and to jump in the real estate market with both feet really contradicts what you have been preaching for the last 3 years.

Yes Windsor has already seen some significant reductions in real estate value due to it’s proximity to Detroit, but one has to keep in mind that Windsor is extremely reliant on what is happening in Detroit….

Any further negative influences from Detroit will put further stains on the entire economy of Windsor. And could potentially see the default ratios quickly rise, which will cause Real Estate values to drop far below the $15000 prediction…

RENT…..RENT….RENT….!!!!

It is almost like we are in the eye of the Housing Hurricane… Logic tells us there is trouble all around us, but all seems calm…. Too calm !!!!

#107 refinow on 08.31.11 at 10:36 am

Murders and crime is down in Detroit, because they cant afford the bullets anymore… Any nobody has anything left to steal.

Crimes are unsolved because there is little left to the police force in Detroit.

I read that if you are a Police Officer considering moving to detroit, they will buy you a house and give you $150,000 to renovate it, if you are willing to work in Detroit….

Tells you something….

#108 BrianT on 08.31.11 at 10:40 am

#106Waterloo-There are lots of tricks available-just saw one a while ago I wasn’t aware of-it is perfectly legal to change your name in e.g. Panama (and get a passport in that new name/identity) and keep your original name here (with Cdn passport in original name). So when you run off to Panama, anyone looking for you will have to be able to locate you under your new name/identity. This is just one trick-I am sure there are hundreds just like it. This is the new globally efficient economy-now you can start thinking like a Master of the Universe.

#109 mousey on 08.31.11 at 10:43 am

Re: #61
Groups of Asians bidding up one house causing increase in value on other houses the group has for sale? Nothing illegal there unless, maybe, the buyer of the initial falsley bid up house was never a bona fide buyer. Not sure if that could be categorized as price fixing, fraud or in breach of some obscure competition or consumer law. We should send out the Fifth Estate or some investigative consumer journalist out to dig in and see whether a) this is happening and b) whether the practice offends a law.

Re: 73
I have no plan to move to Windsor, but the listings you attached to your post made me want to cry. I couldn’t buy a garage in Vancouver for those prices. It does put things in perspective.

#110 waterloo Resident on 08.31.11 at 10:51 am

#84: ( Here is waterloo Resident’s ultimate dream — HELOC fraud: ):

I tried that last year, the banks wanted proof that I owned the house and I couldn’t provide sufficient proof so they said ‘no’. But I tried.

#111 poco on 08.31.11 at 10:51 am

waterloo Resident:

How old are you?…..seriously

#112 kc on 08.31.11 at 10:52 am

79 Utopia on 08.31.11 at 6:40 am

“That might just be the deal-breaker in my books anyway. This commuter guy will actually kill off two vehicles in five years (assuming he trades them in at 100,000 km).”

Are you kidding me? 100K and trade it in? No wonder people in Canada are so indebted. My last vehicle had over 400K before I pulled it off road, and the one I replaced it with had 200K and I paid $400.00 for it.

Suckers… 100K kms is around 60K miles…. still new as far as I care and learn to turn a freaking wrench. (if you gotta have “new” … a fool and his money are soon parted) … add up a leased vehicle…. LOL

#113 debtified on 08.31.11 at 11:08 am

I chose this note as it opened the door to a look at the juxtaposition of psychology and location. Windsor is an interesting market which should cause people elsewhere to seriously reassess. I regret it bored you. — Garth

***********************************************

I did miss the juxtaposition of psychology and location, Garth. However, the last paragraph of my comment did show that I almost got it. I just couldn’t get over of the kind of emails you get and that provided the distraction.

Anyway, Obi-Wan, I understand now that in Windsor it’s so cheap but people still wonder if it’s a good time to buy or not. In other parts of Canada (including places only 3-4 hours away from Windsor), it’s so expensive but a lot of people still wonder why not buy now.

Moving on to the topic of “Most Livable Cities” in the world by The Economist…

I’ve been to seven of the top ten cities and Vancouver remains to be my #1 favourite city (despite people living there like BPOE). I like Vancouver primarily because of the awesome combination of multiculturalism (again, notwithstanding people like BPOE) and nature (mountains and ocean). I guess I am just a little bias because I am Asian and the bigotry is more prevalent in Australia – sad because Australia is so damn beautiful. In spite of this, though, I still visited Australia three times in the last ten years because I try not to let the prejudice of some people affect my decisions (plus friends live there). As I told that one Aussie version of a redneck who blocked my car at a McD drive-through: “Kiss my brown ass!”

#114 Smoking Man on 08.31.11 at 11:09 am

#50 Timing is Everything
not me…wife is 7 starts, I play poker, no comps

going there on the week end to distroy Vald cant remember his name, he is a big loud serb if you ever play at ceaser you know who I am talking about.

Last time i was there Made him lay down a full house 200 dollar pot, with just a bit of acting and 7 2 in my hand, yes I showed them.
he thought I had 4 queens..

he dosent like me and trys too hard to beat me. hence loses his advantage..

#115 City Slicker on 08.31.11 at 11:24 am

#45 NorthOf49 on 08.30.11 at 11:30 pm #33 City Slicker

foreclosuresearch.ca is a scam. See below:

http://taxsaleproperty.org/forum/index.php?topic=1346.0

The dead giveaway on so-called Canadian sites like these is their use of US terms eg. foreclosure, HUD, etc.
———————————————————-
Thx North! I paid the $7 and cancelled right away. Wouldn’t have imagined those places sold years ago. But nothing seemed on sale to me there, just regular prices.

#116 Tom from Mississauga on 08.31.11 at 11:25 am

Hi Garth
Funny story. My company replaced the retired North Region President a few months ago, has about 500 employees under him. Recruited from ATL office. YTO is the largest branch in the North so it was assumed he would set up here. But after finding nowhere in the Pearson area for his family to settle that he could afford in our town hall meeting yesterday he announced he’s moving his office to CHI for the start of the school year. He said quote “I don’t know any of you afford to live here”.

#117 City Slicker on 08.31.11 at 11:26 am

Garth I hear in some countries, like Germany, house prices got to be to high for the average Joe to afford. But they continue that way, and it takes family generations to take over the mortgage and keep paying it off until done so.
Is this kinda stuff true?

#118 Snowboid on 08.31.11 at 11:32 am

#81 bigrider on 08.31.11 at 7:23 am…

That is one fine list! The reason stated for Vancouver dropping was the 2 hour traffic disruption when the Malahat closed for an accident.

I suspect the reviewers had no idea where Vancouver is in relation to Vancouver Island (where the Malahat is).

This always used to happen when we said we lived on Vancouver Island, people always thought we meant the city.

Maybe they need to change the name of the island?

#119 Cognizant on 08.31.11 at 11:47 am

Speaking of fraud, what proof does any landowner in Canada have that he or she owns anything at all? Does any landowner in Canada other than the Crown actually hold title?
Feel like a sucker now? Who defrauded who?

#120 Devore on 08.31.11 at 12:03 pm

Derek _could_ rent in Windsor, but really, with average house being around 2x their income (will the wife retain her job with the move?) renting cannot possibly be much cheaper than owning, and maybe even more expensive. I checked Craigslist, and it’s not telling me much. Very little rental inventory available, and prices for 1, 2 and 3 bedrooms are all over the place. Without knowing the rental market in Windsor, I’m guessing it’s not very good for renters, and no surprise, when an industrious couple could buy a whole house for cash after a few years of aggressive saving.

#121 The InvestorsFriend on 08.31.11 at 12:07 pm

PICTURE NOT FUNNY?

Number 6 Best place on Meth said:

I don’t see anything funny about today’s picture

****************************************

Right, but I don’t think it was the FUNNY Bone that this picture was meant to stimulate.

P.S. what a silly email, Buy the damn house in Windsor!

#122 Utopia on 08.31.11 at 12:38 pm

#112 kc

“Are you kidding me? 100K and trade it in? No wonder people in Canada are so indebted. My last vehicle had over 400K before I pulled it off road, and the one I replaced it with had 200K and I paid $400.00 for it”
——————————–

Relax kc, it was only hypothetical. I have an old car too that I actually prefer to the new bucket because it is easy to fix and costs me nothing. I assume that Derek probably drives new or near-new based on the info he left. Most people doing long commutes prefer a combination of reliability, warranty and fuel economy over the hassles of an older vehicle brings.

It is no fun being broken down on the side of a highway during a blizzard because the beater failed at the worst possible moment. I doubt Derek drives a wreck.

#123 jess on 08.31.11 at 12:41 pm

Bush:
…”some people call you the elite i call you my base
http://www.youtube.com/watch?v=mn4daYJzyls
=

The latest in tool metaphors and nuts squeezing and god’s butlers.
The New York attorney general was accused of using a “wrench”.

http://www.rollingstone.com/politics/blogs/taibblog/obama-goes-all-out-for-dirty-banker-deal-20110824
http://app.ny.frb.org/newsevents/news/aboutthefed/2009/an090727.html
http://www.huffingtonpost.com/miles-mogulescu/eric-schneiderman-new-york_b_940004.html

#124 BrianT on 08.31.11 at 1:19 pm

Canada GDP declining-good thing we have delegated all long term economic strategy to Mark Carney-if we can just get the right interest rate mix everything will be magic http://online.wsj.com/article/SB10001424053111903895904576542234215329782.html?mod=googlenews_wsj

#125 Cookie Monster on 08.31.11 at 1:29 pm

Funny, I’m looking at doing the same thing, working and renting an apartment in the big D while buying a house in Chatham or Sarnia eventually.

#44 Tim on 08.30.11 at 11:29 pm

Why would anyone buy in the Detriot of Canada? The auto industry is not coming back, despite the poor decisions and misguided efforts of our Government
—-
If our governments could quit meddling in healthcare and public education and get rid of 75% of the public sector dead wood then Canada/Ontario could lower taxes drastically and become a powerhouse once again. Otherwise we’re doomed.

“If our governments could quit meddling in healthcare and public education and get rid of 75% of the public sector dead wood then…” …we could be like Detroit! — Garth

#126 Nemesis on 08.31.11 at 1:47 pm

“Windsor is an interesting market…” Hon. GT

It’s much more than that, GT… for some of us, however far we may ‘stray’ from our UpperCanada origins, MoTownSouth will always be home.

It’s where the HeartIs [and with a surfeit of DecentHousing on hand for less than most new examples 'o TeutonicIron, one hardly requires a CheerLeader to indulge/succumb to TimTayShun [temptation]…

http://tinyurl.com/3wfznf9

Buy her one, Derek. It’s only money.

#127 palebird on 08.31.11 at 2:21 pm

117 City slicker Yes that is true in lots of the cities. But it is a completely different scenario. Built up areas of the country have little land to build on. They are very crowded compared to us. And the majority of people rent apartments which is socially perfectly normal.

#128 Cookie Monster on 08.31.11 at 2:26 pm

“If our governments could quit meddling in healthcare and public education and get rid of 75% of the public sector dead wood then…” …we could be like Detroit! — Garth
——
We wish we were like Detroit, I was just there and it’s a nice city. I’m personally very keen on getting one foot out of Canada and into the USA because the US has a solid constitution that if rediscovered will drastically improve their economy very quickly. And if Ron Paul can win in 2012, yes I know it would take a miracle, but if he did win and big changes come such as a return to the gold standard, then that would form the root of an incredible productivity boom and social/economic improvement, smart hardworking people and entrepreneurs would flock to the US once again and production would return to N.A.
If not then we’re still doomed, and them too.

#129 pugnacious serf on 08.31.11 at 2:50 pm

#4 squidly77

Great blanket statement; your ignoring some of the key facts to this post by Garth and the question from Derek.

His quality of life is being effected because he’s spending 2 – 4 hours a day commuting. TIME = MONEY is the thing to focus on here, and unless his car is running on sunshine and rainbows, I’m pretty sure that his fuel and insurance costs will drop dramatically with the move closer to the bridge.

The cost of an entry level home in a town already hit by the recession is at 2 X earnings. A detached home with a big backyard and four bedrooms for about $240,000 or 3 X earnings. In this scenario a home is affordable at $240K and doesn’t constitute a 8% drop just because of your math. A $480K home is obviously a different story.

This average drop in prices in homes across Canada for the most part will come out of the hides of real estate owners in Vancouver and Toronto. These are where the epicenter of the bubble has erupted. Even the less than “average” price of homes in these centers are beyond affordability. Places like Calgary, Saskatoon, Winnipeg, Ottawa, Montreal, Halifax and Saint John’s will stagnate, but its the properties above the current average price in these places(And all of Canada) that will push down the “average” metric. People will still need a roof over their head and the lower end of the market is where they will end up, not in 3000sq/ft granite particle board $750K castles.

The most obvious thing being over looked by people worried about a substantial interest rate hike is the buffer the BoC has in the value of the dollar. If things get cold in Canada, there is room to leave rates alone and let the dollar devalue in comparison to the USD. This would help our exports and I believe is the end game for the finance minister.

This still won’t protect young people that are taking out large sums of debt to buy homes and gadgets that it took 20 – 30 years for their parents to acquire.

Higher end homes are currently heading down in value across the board because of lack of demand(or wealthy immigrants across Canada); a $900K home might have to drop 20% where as a $300K home might only drop 5% to find a buyer. So its not a generic 8% across the board, and smaller centers like Windsor, won’t see anything other than stagnant prices at worst.

The only way we will face a significant rise in interest rates is the continued explosion in the price of gold and other commodities. Rates are the one tool central bankers have to chase people out of commodities and back into paper.

Before you pull the trigger on a piece of real estate, to live in, make sure its within the 3 X income; to rent, make sure its cash flow positive and you could rent it out for less than the average cost in your area; being risk adverse in real estate right now is key, as Garth has stated too many times to repeat!

#130 Ultraumatic on 08.31.11 at 2:55 pm

#85 Utopia on 08.31.11 at 8:09 am
#42 Elmer
“Definitely no reason to go through the trouble of crossing the border (and paying that toll, what is it now, $4.75?) every day.”
What? There is a toll too? So I am guessing that you pay it both ways meaning that adds almost ten bucks a day to the commute.

There’s a Border Services program called Nexus for people who commute Windsor-Detroit every day:
http://www.cbsa-asfc.gc.ca/prog/nexus/menu-eng.html

With only a $50 processing fee, you get a card that enables you to easily cross that border toll-free, for five years. So no worries for the letter writer.

The Windsor-Essex County area is a bit of a hidden gem, glad to see this post today.

#131 BPOE on 08.31.11 at 2:59 pm

Folks,
Here is a wonderful PRO BPOE site. I love this site and fully endorse the information contained. Lots of anecdotes here how BC will never fail. LOVE IT!
http://vreaa.wordpress.com/

#132 Robert Dudek on 08.31.11 at 3:05 pm

My asian realtor says there is a group of investors buying up homes in one area. Then they get a huge group of people together to stage a bidding war to up one house to over 50%-75% over the asking price. Once that pumped up house is sold all the other houses that they own in that area just went up the same amount. Then they sell for a profit and move to a new area which is why so many houses being bought by asians are VACANT. They’re flipping them.

Pump and dump schemes are a lot easier in the stock market and you have far lower costs of doing business.

#133 Drake on 08.31.11 at 3:21 pm

After three years renting in the Windsor area, now he tells me! Could have bought much cheaper in 2008.

#134 MDG in Burlington on 08.31.11 at 3:33 pm

# 7 Waterloo Resident

Re: live in Detroit…. it’s called US Immigration regualtions access to a green card and residency requirements (Permanent Resident Status). Or maybe a combo of all three.

As a CDN or a PR you cna only stay in the US for 6 months under a visitor; don’t wnat to violate the US laws especially if you have to cross the border on a consisitent basis.

#135 David on 08.31.11 at 4:02 pm

One has to wonder why Derek is second guessing himself. Solid fundamentals, benign climate, affordable housing, cross border shopping and shortened commuting times.
The housing market has already done the limbo in Windsor.
What else? Good opportunities for education and access to decent health care.
He who hesitates is lost. No one is going to ring a bell and say that now is the time to buy.

#136 Pr on 08.31.11 at 4:32 pm

Make sure that you gonna live their for more than 30 years. Before that, if you want to sell, you will realize that you bought your self a…PRISON, and you can get out, Whit out losing 10s of thousands of dollars. Plus you will miss all the opportunity of those 0$ cash down and 35-40 years amortization that will have to sell in the same time. My crystal ball see a lot of FOR SALE sign all across CANADA.

#137 Junius on 08.31.11 at 4:50 pm

#123 Jess,

Sadly Eric Schneiderman along with Beau Biden appear to be the only people brave and honest enough to go after the banks. He may end up being our generations version of Ferdinand Pecora. Now if we could just find a US President who could be a Teddy and Franklin Roosevelt combined we could see some progress.

#138 Junius on 08.31.11 at 4:52 pm

#128 Cookie Monster,

You said, “the US has a solid constitution that if rediscovered will drastically improve their economy very quickly.”

I am almost afraid to ask the question but – how?

#139 Coho on 08.31.11 at 4:58 pm

We wish we were like Detroit, I was just there and it’s a nice city. I’m personally very keen on getting one foot out of Canada and into the USA because the US has a solid constitution that if rediscovered will drastically improve their economy very quickly. And if Ron Paul can win in 2012, yes I know it would take a miracle, but if he did win and big changes come such as a return to the gold standard, then that would form the root of an incredible productivity boom and social/economic improvement, smart hardworking people and entrepreneurs would flock to the US once again and production would return to N.A.
If not then we’re still doomed, and them too.

Pretty inspiring. I too, feel there is hope for the USA, but it will be up to the people to take their country back. They’re not getting the leadership they need from their ‘representatives’. The people is the goose that lays the golden egg but it is being exploited if not abused by those who’ve been elected to serve their (and by that, the county’s) best interests. Perhaps there have been some well meaning men and women which have arrived in Washington with good ideas and honest intentions, to serve, but something happens to them in Washington. Maybe they’re told, “Always remember, what is good for Wall Street is good for Main Street. And war is good, too. You WILL remember that won’t you”?

IMO, for even the chance at a decent future for themselves and their kids and grandkids, the people need to exorcise the ‘demon’ that has taken over Washington politics…like Gandolf did to that vile entity that had taken over the King of Rohan in Lord of the Rings. Just like the King, the USA, its foundation and ideals, have been usurped and it has gotten waaaay off track.

#140 Junius on 08.31.11 at 5:03 pm

#117 City Slicker,

No. Germany is not very expensive by world standards and based on average incomes. However it isn’t cheap either with an average home around 230,000 Euros.

Maybe do a web search first:

http://www.globalpropertyguide.com/Europe/Germany/Price-History

They have not suffered the wild swings of the UK, Spain and Ireland because they have not granted cheap credit. Sort of how Canada would have been our gov’t not been stupid enough to juice the market with the CMHC rule changes and emergency interest rates.

#141 Peakoilist on 08.31.11 at 5:25 pm

Definitely rent in Windsor for the time being.. iiiiiiittttt wwwooonn’t beeeeee lllllooooonnnnnggggg nnooooowwww beffffoorreeee wweeee sseeee aaaaaa coooorrrrrreeeeecccctttiiiiiiooooonnnnn. Just hold on.

#142 Steven Rowlandson on 08.31.11 at 5:28 pm

Garth I am 51 years old and frankly given the laws, low pay and expensive cost of living I am surprised anyone is getting married or living in Canada.
I am here by accident of birth and habit any thing else is probably illegal or too expensive.

#143 Imstupid on 08.31.11 at 5:42 pm

#5 Waterloo resident

Wrong blog hippy. Ride a horse come on.

#144 Carpe-Diem on 08.31.11 at 5:51 pm

For nearly 2 years I travelled over 2 hours each day commuting from North of Toronto into the big smog. I made that trip purely to get my break into the Insolvency industry – its a tough nut to crack, and when an opportunity arises, you take it.

The drive surely must have taken a few years off my life, probably like a chain smoker. I was blessed to find employment today that is a total of 11 minutes to work. All I can say – take the leap of faith, your not taking the money with you when you die – if you can cut your driving time by 80%, why hesitate. You save money, time, anguish and most importantly – your sanity!

P.S – I ask those who make horrendous, misguided statements regarding Bankruptcies, but a copy of the Bankruptcy and Insolvency Act – the comments are borderline retarded.

I would be more than happy to provide correct info.

#145 Carpe-Diem on 08.31.11 at 5:54 pm

correction – “buy” a copy of the Bankruptcy and Insolvency Act. $160.00 per copy through Carswell.

#146 jess on 08.31.11 at 6:31 pm

137 Junius

I like how Matt Taibbi worded it

The idea behind this federally-guided ‘settlement’ is to concentrate and centralize the legal exposure accrued by this generation of grotesque banker corruption in one place, put one single price tag on it that everyone can live with, and stuff the details into a titanium canister before shooting it into deep space.”

recall
The Return of ‘Good Bank-Bad Bank’
remington-work.blogspot.com/…/return-of-good-bank-ba… -
8 Aug 2008 –

#147 Cash is King on 08.31.11 at 6:42 pm

#45 55 North

Your biggest problem with Windsor is that the 401 is many kms away?? Really??? I guess your home next to the 401 you enjoy the constant 110 km an hour noise and the wailing of emergancy vehicles at all hours of the day.

More than happy to drive an extra 15 minutes to get on the 401 and enjoy the peace and quiet of having a car travel down my street every 15 minutes. Knock us Windsorites all you want. Our homes will be paid off long before your grandchildren are even born

#148 Cookie Monster on 08.31.11 at 6:49 pm

#138 Junius on 08.31.11 at 4:52 pm

#128 Cookie Monster,

You said, “the US has a solid constitution that if rediscovered will drastically improve their economy very quickly.”

I am almost afraid to ask the question but – how?

The purpose of the US constitution is to limit government’s size and scope, the founding fathers of the US recognized government is a necessary evil that must be chained and caged. Lately the chains are busted and the cage door has rotted off its hinges starting from the supreme court down.

Rediscovery of their constitution would help the economy by drastically shrinking their government, repealing regulations, restoring liberty and honesty in money. With people free and unencumbered, taxes slashed and wars ended, interest rates could rise, consumption can drop, savings can increase, capital can be formed and entrepreneurs could flourish.

#149 Junius on 08.31.11 at 6:50 pm

#139 Coho,

You said, “the people need to exorcise the ‘demon’ that has taken over Washington politics.”

I thought Dick Cheney was out of politics. Or are you referring to the influence of money in politics in the US?

#150 Imstupid on 08.31.11 at 7:05 pm

#128 Cookie monster

Detroit is a nice city, for who crack hookers and gang bangers? Sure their are nice neighborhoods but go down the wrong street and you will find yourself robbed and maybe dead.
Ron Paul, even if he got the presidency where would he find the support? Obama promised change and look how well that worked for him.

#151 Imstupid on 08.31.11 at 7:21 pm

#33 city slicker

Yes it is a scam. With recourse mortgages in Canada the owner of the mortgage must try to get market value for foreclosed home. This means the mortgage holder must market and list using regular avenues. If the mortgage holder does not the person who foreclosed can sue for damages. This is because the mortgage holder must return the excess funds to the homeowner.

#152 jess on 08.31.11 at 7:29 pm

junius looks like eric is finding some support

Nevada Wallops Bank of America With Sweeping Suit
by Paul Kiel
ProPublica, Yesterday, 5:46 p.m.

By vastly expanding its suit against Bank of America, Nevada jeopardizes a proposed nationwide settlement with big banks and directly challenges a previous multistate settlement

#153 BOB on 08.31.11 at 7:50 pm

I am looking to buy a stock that trades for 1.00 per share or thereabouts. I am looking for a growth stock with huge potential in the future. A stock in the hi-tech or biotechnology area. I already invest conservatively through monthly ETF purchases but looking to supplement this with some growth stocks. I like to buy my stocks minimum 1,000 shares. Any ideas??

#154 Nostradamus Le Mad Vlad on 08.31.11 at 8:10 pm

-
GS is pushing for QE3. I wonder if that is because they will make billions from selling treasuries, bonds and the like back to Bernanke & Co.? Methinx the house of cards is Tumbling Dice now.
*
Bernanke Life without parole? 3:31 clip Let’s Lynch Lloyd Blankfein; Bankrupt Solyndra, who used to build solar panels; Fake Rally Wall St. and Bay St. are also fake; Libya “The new leaders said Libya may start pumping oil again in days.” “That very last sentence is, of course, the only really important issue!” wrh.com; Lemonade Stands Good analogy; Outrage The whole business / political thing is way out of hand.

4:05 clip Nixon ends the Gold Standard. “As long as CNBC is running a poll this morning on a return to the gold standard, here’s Nixon’s televised address formally ending the gold standard in 1971.”; Banks snooping and ordering customers to pay mtgs. first; Holy War to keep military spending going, and other links; O’bomba New medical term for the economy; Surprised? The west may have something to do with this; Ten States with the worst economies in the US; Research shows that rich people make others poor. Huh? Electricity Time to jump off the grid, or make money? UK Economic danger zone;

Homegrown Terrorism “Translation: After the next false-flag attack, the US is gonna come down hard on American dissidents.” wrh.com; Fructose hidden in the groceries; Speaking of Detroit All charges dropped; Two Faced A good explanation (this story) as to how TPTB dictate what govts. can / can’t do; 5:54 clip How the m$m portrays Gadaafi. He straightened out a disoriented country in the late 1950s, and because they were never reliant on the IMF, this is why the UN, NATO – US and others have chosen to steal their wealth; Winnipeg Something is quite silly here, and it isn’t the church; Canada Dictatorship “We don’t like to handcuff children but safety is the No. 1 issue here and if it’s called for, we will do it,”;

1:24 clip Two Chatbots, male – female. Are we becoming like them? New Brunswick RCMP not investigating real crimes? Dick Cheney scared of something? Seems so, and Dick Cheney’s book “The man’s a liar, a killer, a shill for the rich and assorted other unsavory things.”; Monsanto Superbugs “Look for leaner yields and a huge spike in prices on these commodities.” wrh.com; Glysophate “Glyphosate is killing off natural species of plants. That means an enforced dependency on corporations for our food!” wrh.com; Irene Re-assessment on damages; Latest Carbonazi Claim “So the rise of global dictatorship, the crashing economic system and endless wars of conquest around the world have nothing to do with it, right?” wrh.com; Google Another reason to avoid it; Bureaucracies gone wild.

#155 kitchener1 on 08.31.11 at 8:35 pm

Canada’s GDP growth is -0.4, last quarter was posistive 0.3. just borderline recession territory right now.

To the person on the street, they wont fell the difference. it might as well be a recession.

This matters a lot !

So far, everyone is pretending to be happy– no worries, it means nothing.

Thats because once we hit another quarter with negative growth, it will be offical and then the real damage starts.

People will start hoarding cash and putting off any big spending commitements going forward, no basement reno, no new kitchen/roof/car/rv/tv/computer/dinners and on and on.

First time RE buyers get jittery, and that means there are no move up buyers– remeber the last time buyers went on strike in 08/09 prices dropped hard and fast.

That hoarding kills small business and large alike, margins gets squeezed hard and business start to lay off people.

Currently, everyone is trying to manage expectations and talk it off, just like the euro guys did. But it does matter and without a signifcant improvement in the US economy, we will enter and stay in a recession for a long time– it might be a long one, a weak one, but a recession it will be.

#156 Herb on 08.31.11 at 8:44 pm

… “buy” a copy of the Bankruptcy and Insolvency Act. $160.00 per copy through Carswell.

- Carpe Diem

or read it for free without legal comments at

http://www.canlii.org/en/ca/laws/stat/rsc-1985-c-b-3/latest/rsc-1985-c-b-3.html

or

http://laws.justice.gc.ca/eng/acts/B-3/index.html

#157 mickey on 08.31.11 at 9:03 pm

It cost 50 cents a km to commute. What are you waiting for?

#158 Onemorething on 08.31.11 at 9:14 pm

Downside in Windsor if buying likely only 10% when the RE market in Canada avg’s 25-30% and those top bubble spots shave 40-50+%. Lock a 5 year and pay it off in that time. Next Question please!

#159 Cookie Monster on 08.31.11 at 9:22 pm

#150 Imstupid on 08.31.11 at 7:05 pm

#128 Cookie monster

Detroit is a nice city, for who crack hookers and gang bangers? Sure their are nice neighborhoods but go down the wrong street and you will find yourself robbed and maybe dead.
Ron Paul, even if he got the presidency where would he find the support? Obama promised change and look how well that worked for him.
—–
Absolutely true. I’ve seen the bad side of Detroit once. One time years ago after driving back from Mississippi I exited the freeway to filler’ up one more time before crossing back into Canada and what a mistake that was, the scariest part of my whole trip I left an abandoned gas station realizing I was in danger, the place was much scarier than Biloxi or LA. I guess being a bald white guy driving a white Crown Vic didn’t help either, the stares I got from the black folks on the street could have stripped paint off wood.

But yeah, the nice area I was referring to was Rochester Hills area, north Detroit area.

#160 miketheengineer on 08.31.11 at 9:25 pm

Garth et al:

Been to Windsor lots of times. Stayed in the Hilton near the border more times than I can count. Worked in Warren Michican. Lived there for 6 months.

Housing prices still declining in US side. When Canada corrects, my fear is it may be worse than Garth even estimates. Only God know the future.

My advice. Find a “newer” place with a nice chunk of land, and a basement with separate entrance. (and finished and ready to rent out). Or finish basement your self and then rent out. Even if you only get 500 a month from rental, it will pay 1/2 your mortgage. Then no matter what happens you will be better off than most. And if gets really bad, you can move in with your mother or the inlaws and rent out the upstairs and downstairs. Either way even if the amont paid today goes down, you still have a place to live, and or a rental place that is paid for by tenants 100%.

Good luck dude, happy wife and a happy life.

#161 Uki1 on 08.31.11 at 9:34 pm

Maybe I am missing something, but how that could be true:
“Derek works in Detroit, lives in a small town east of Windsor.”

“So, they want to move closer to his work, back to Windsor. ”
Can somebody explain it to me what is wrong here ?

#162 patiently waiting on 08.31.11 at 10:03 pm

#132 Robert Dudek on 08.31.11 at 3:05 pm

My asian realtor says there is a group of investors buying up homes in one area. Then they get a huge group of people together to stage a bidding war to up one house to over 50%-75% over the asking price. Once that pumped up house is sold all the other houses that they own in that area just went up the same amount. Then they sell for a profit and move to a new area which is why so many houses being bought by asians are VACANT. They’re flipping them.

Pump and dump schemes are a lot easier in the stock market and you have far lower costs of doing business.
____________________________________________

I believe this scam is going on in South Surrey/White Rock area. I have noticed Asian buyers who have bought homes within the last 6 months (or less) putting them back on the market for anywhere from $400,000 to $1,000,000 more only a few months later. Never seen anything like it . . . insane . . .

#163 Steven Rowlandson on 08.31.11 at 10:11 pm

The privileged group of super earners that can buy houses and get married are a limited human and financial resource and I think most of them have houses. Do you all think people who live in the real world are going to take leave of their senses and buy your homes and make you all fabulously wealthy based on our $10 to $15 buck an hour jobs ? Do you think that we are going to marry your daughters and risk divorce , snitching and getting cheated on because the law allows or demands it? Why should any one who lives in the real world do a damned thing that is too expensive or legally hazzardous? Boomers and government people need a reality check real bad.

#164 Carpe Diem on 08.31.11 at 10:13 pm

Herb, that’s only a start my friend. Your missing crucial parts regarding the Bankruptcy and Insolvency general rules / Tariffs / Companies Creditors Arrangement Act / Wage Earners / Directives and Circulars…and one of the most important facts…case law studies which establishes precedent.

In common law legal systems, a precedent or authority is a legal case establishing a principle or rule that a court or other judicial body may utilize when deciding cases.

Herb, you provided a valuable link, but as anything free – its provides a partial picture. My comment was just based on that most who interpret Bankruptcy law on this blog are making outlandish comments…yes, I know – what, on this blog.

#165 smw on 08.31.11 at 10:17 pm

#161 Uki1

Maybe he lives in Tilsonburg.

My back still aches when I here that word…

#166 CoB on 08.31.11 at 10:33 pm

Yay Windsor! As an ex-Windsorite now living in RainCity, I would gladly move back if I had the same job opportunities. Windsor has amazing real estate and amazing pizza! I have several friends in Windsor who are mortgage free in their early thirties. Unreal!

#167 Coho on 08.31.11 at 11:21 pm

#139 Coho,

You said, “the people need to exorcise the ‘demon’ that has taken over Washington politics.”

I thought Dick Cheney was out of politics. Or are you referring to the influence of money in politics in the US?

The term “Demon” was not personalized to any particular person, although Cheney, imo, would be a front running candidate for people wanting to identify a face with it. :)

I meant more like a dark, negative energy or “Presence” that if entertained enhances and brings forth peoples’ bad attributes and corrupts and mitigates good ones. For the most part, politicians are just average people with human frailties and shortcomings like the rest of us, except they are in positions of power and thus tools to be influenced and used to further the interests of not so average people.

We have presidents and prime ministers as heads of state “leading” tens of millions if not hundreds of millions of people. When one thinks about it, isn’t that way too much power for a single person or a small group of people to wield? We know that unelected, powerful people “have their ear” and the result is very big farms with human and national resources to exploit and harvest. And that may be why the tendency is to usurp state and provincial powers/assets and centralize them in federal government hands.

#168 Herb on 09.01.11 at 7:23 am

Carpe Diem,

agree with much of your #164. However, the CanLII site gives you access to the decisions that make the precedents, and does so handily by relevance and date/currency.

There is nothing as legally instructive as reading the “Reasons for Judgment” that invariably review statute and case law, as well as applicable regulations and any recognized academic opinions. By any means, pay Carswell or a lawyer if you have the money and the amount at issue warrants it, but you can do much of the work yourself for free, and get a good idea of how you would fare in court to boot.

#169 steve p on 09.01.11 at 5:55 pm

hey i think this is the first time you have used the word ponzi to describe the real estate bubble