No conditions. No surrender.

An update on the mid-Toronto bidding war which took place last night. I told you there were 12 offers and the $1 million house sold for $1.2 million. I lied. Well, more accurately, this blog’s press deadline came before all the dust had settled. So here’s the outcome.

The property was, like me, seductive but not life-altering. Heavily staged, though, it was great house porn. But no garage, small bedrooms, no ensuite, with a McMansion next door blocking the sun and not enough room between properties to take your horse into the backyard. Good street, but still solidly middle class. Low Mercedes sperm count.

The process now has become irritatingly familiar to anyone trying to buy a home. The realtors open the place up for a few days, tell fellow agents on the hot sheet that offers “will be gratefully accepted” at a certain hour on a set day, and must be accompanied by a certified cheque for a deposit not to be less than 5% of the offer price (in this case, at least fifty grand).

Sometimes a rebel buyer will break ranks and make a bully offer. One of those happened a few hours ago in the same hood – with a $1.25 million house getting a $1.45 million offer a day after hitting the market. The owners caved and took it, but deprived of the vicarious joy seeing a dozen couples sit in their cars lining the curb outside, sweating and Starbucking.

Of course, there are no conditional offers. The homeowner might have a home inspection report sitting out for perusal, but anyone silly enough to actually check out what their million is buying, needs to arrange their own inspection in advance of the offer time. Because of the competition, it’s impossible to ask for a few days to arrange financing, to sell another property, or even to suggest a closing date other than the one perfectly suited to the sellers.

As for knowing what to offer, you can’t. The list price is just a fuzzy starting point. The more offers that are registered (the typical cut-off is an hour or two before showtime), the more the winner ends up paying. Since the process is akin to a silent auction, no suitor has any idea what anybody else is throwing on the table – but it’s fairly certain everybody needs to exceed the asking price. It’s a total shot in the dark.

“The seller has absolutely all the cards,” a long-time agent laments to me. “And the buyers have none. It is quite regrettable that this has been allowed to happen.” But it’s everywhere in Toronto now, in these uncharted times.

In the couple of days, for example, 98 Churchill (Yonge/Eglington) sold for $1.25 million, after being listed for $979,000 for six days. 45 Churchill (Trinity-Bellwoods) sold for $1.2 million after seven days at $999,000. 14 Vermont (Bathurst/Vermont) went for $1.41 million desite its $1.2 million price. And the wars are not just for the rich. 337 Westmoreland listed for $379,000 and sold for $469,000. 584 St. Clarens came to market at $499,000 and six days later was worth $636,000.

Yet despite this intense competition for limited listings, the Toronto Real Estate Board reported this week only a small average price hike in recent weeks over last year. In fact in 416 the average detached home fell by more than $40,000. That hardly matched the $100,000 crash in average prices in Vancouver, but it was meaningful after months of relentless gains. “Competition between buyers remained strong in many parts of the Greater Toronto Area during the first half of April,” TREB said, “with many listings attracting a lot of attention.  Strong competition meant that, on average, sellers priced within market value range received offers that matched their asking prices within three weeks.”

Of course, the realtor cartel hasn’t suggested how people looking to house their families, who need to live in the big city, should deal with this phenom. Agents work for sellers. It’s where the money is. So bidding wars are purposefully created. Offers are held back from sellers. An auction environment’s created. Listings are low-balled to goose demand. Vendors move out and stagers move in. Days on market are shaved, so showings cascade upon each other. The moment of truth has all the drama of an Oprah sighting or the gore of a UFC event. As agents stand on the lawn and their buyers vex, the envelopes are opened.

On this night – the one before last – there were not twelve offers, but 15. Each one was for more than the asking price of just over one million dollars. After reviewing them all, 12 couples were sent home with their certified cheques. Three others were asked to enter a second round of competition, given a few moments to add fifty or eighty thousand dollars. Within minutes the sellers had a firm offer of one used Hyundai less than $1.3 million. And, thus, the value of this home increased 30%. It became a comparable for every other owner on the block.

As important, 14 jilted, rejected purchasers drove off into the dark, either determined to win next time, or disgusted they’d been so used.

Yesterday I wrote about the inevitable and coming increase in interest rates. But higher rates are not a prerequisite for real estate’s temple to fall. The cost of money’s still dirt cheap in Vancouver, for example, and yet both sales and prices are tumbling. A year ago bidding wars turned every listing there into an emotional battleground. Today the buyers are leaving.

Over and again I’ve reminded you that real estate is the most emotional of assets. Its value determined by want and lust, greed and fear. Soon you can add revulsion.

223 comments ↓

#1 TurnerNation on 04.18.12 at 8:47 pm

First?

No, I was. — Garth

#2 johnG on 04.18.12 at 8:50 pm

Things are ugly in winnipeg. A real dog of a budget.

It is different here! For the worse…

#3 Randy on 04.18.12 at 8:50 pm

Don’t take it personal…it’s only business !!!

#4 gokou3 on 04.18.12 at 8:57 pm

Your story reminds me of the good old times in Vancouver, circa… 2011?

#5 TurnerNation on 04.18.12 at 8:58 pm

Ear to the ground: few-years-old Oakville townhouse just sold – 15k over offer, a few bids.

#6 AM on 04.18.12 at 9:01 pm

Anybody think bidders in the GTA Look at Vancouver as an example of things to come? Likely not, cause the correction in the US has been regarded as irrelevant to canadian RE up till now.

#7 TurnerNation on 04.18.12 at 9:03 pm

As the Beatles said, Happiness is a Smoking Gun!

(I could not come up with a Russian Reversal at this time).

#8 James Banks on 04.18.12 at 9:07 pm

It’s not really written in the history books that way, but I think this may be how they brought down Rome.
Sure, the place was sacked by the Barbarians (my direct ancestors..) but certainly that was well after the bubble burst.
Question: How far can a society cantaliever itself out over empty space…?

#9 FTP - First Time Poster on 04.18.12 at 9:11 pm

Excellent post! I have read 3 different (non MSM) writeups recently regarding the impending fall of Canadian RE. I only have one question to ask Garth, what are you going to write about once you’re no longer contrarian and become mainstream?

Just watch me. — Garth

#10 First time poster on 04.18.12 at 9:13 pm

Like the poster on yesterday’s blog, I am deciding whether to wait for two years (which is the longest I can hold my family back for) or just hold my nose and buy into what is clearly an overpriced market. We have recently relocated and inherited and currently sit on $1mil cash, which should be a lot of money for a house, but very sadly isn’t. Location is non-negotiable for family and job reasons so no use thinking we can buy for less than $1mil and invest the difference (although we do have other investments luckily). For only two years, buying stocks is clearly out and if we’re only talking 15% moves then it seems like buying would be OK, especially as this will be our home for 20 years I hope. So, any guesses on the odds that in two years (a) the market will have gone down by more than 15% or (b) the market will have gone up by more than 15% or (c) the banks will have collapsed like the doomers predict and I’ll wish I hadn’t had cash!

#11 LJ on 04.18.12 at 9:19 pm

Canadian real estate looks like a blow off top is in progress.

Even some of the battered markets (Alberta) seem to have sprung to life to participate in the zealous greed.

These buyers know not what awaits…

#12 shanks on 04.18.12 at 9:25 pm

crazy those prices… i guess its a good business? lol no business without sin.

vlad this one is for you:
http://news.nationalpost.com/2012/04/17/new-brunswick-town-plagued-for-weeks-by-earthquake-swarm-and-no-one-know-why/

funny thing is, if you look at earthquake.usgs.gov, there is nothing being reported in that area of Canada.

#13 PricedOutYouth on 04.18.12 at 9:27 pm

Ha Ha Toronto! Bidding wars spiralling out of control. Go complain to Mark Carney or F and see how far you get. Youth have basically been told to take a hike out of Canadian centres. Now you know what hurt young Vancouverites, who happened to miss out, have been tolerating for some time now. Canada is no longer a compassionate country to live in. Dog eat dog.

#14 Paolo on 04.18.12 at 9:28 pm

Fantastic! Keep it up I say. Plenty of Greater Fools, eager realtors, greedy sellers and hysteria! More bids, bully offers – - homes in Toronto should go for 1.5 million!

All in line with salaries, things to come, moribund economy, slow growth, etc…

Is the long awaited train wreck finally here?

Carney preaches but is powerless. F is laying low. Ontario faces another election possibly in May if budget is defeated A pril 24th…

Ridiculous. Beyond anything I could ever imagine.

Shortage? No shortage of stupidity. That is for sure.

#15 T.O. Bubble Boy on 04.18.12 at 9:28 pm

Don’t forget the shameful realtor practice of re-listing at a higher price. Several of these listed/re-listed today, for example (from guava.ca):

C2309457: now $2,039,000

Mar 16: $1,739,000
Mar 25: $1,939,000
Apr 18: $2,039,000

classy!

#16 Smoking Man on 04.18.12 at 9:32 pm

The Output Gap

When Carnage talks about the Output Gap, he doesn’t mean a brunet in a Red Bikini trying to do up her laces while on roller skates.

Output Gap is bankers speak for when too many tax farm slaves are on the payroll, allowing other tax farm slaves to be in a better negotiating position. There is no way they are going to get bullied by the help asking for more loot. Lets slow things down by spiking rates.

Inflation in the cost of goods is never really acted on, last 2 years, I rest my case, but let the dog have a bigger bone, watch out. And they pretend to wonder why Canadians are in so much debt.

Get with the program Bubble Heads Start a business and own your own slaves. Your only salvation in the new world order, or you can try GOD. I would but my membership in that club has been revoked.

In LongBrach my new hood for a year now, everything is sold in less than two weeks, it takes that long cause no offers for 10 days, up price, bid, and gone.

Carnage had a chance emasculate this market with a 1% in your face don’t know what hit you. Now he has created a situation whereby panic buyers will pay almost anything to beat the hike.
And sellers don’t believe him anymore.

The Perfect Storm

I love Real Estate

#17 TimV on 04.18.12 at 9:32 pm

If the buyer’s realtor can’t tell their clients a decent estimate of the house’s market price, why do we expect the seller to do it?

#18 Keeping the Faith on 04.18.12 at 9:33 pm

#10 First Time Poster
How dare you display your ignorance on this blog! There is no cure for stupidity, so buy already.
IDIOT!!!

#19 TS on 04.18.12 at 9:33 pm

Garth,

stop blaming Real Estate agents. They’re hired to make the most amount of money for their clients.

Nobody was putting a gun to the head of those 15 couples and forcing them to bid for that house. They did that themselves.

Don’t blame the banks either. They know that people will forgo trips, eat cat food and have their heat turned off before they stop paying their mortgage. Mortgages are the last things that Canadians stop paying.

Nobody is above personal responsibility.

I saw no object of blame in my article, other than greed. — Garth

#20 Keeping the Faith on 04.18.12 at 9:34 pm

STEVENSON, you-who?!?!?
are you out there?!??!
How do ya like me now?

Common, pipe up and tell us what colour the sky is in your world on April 18?
Is your oxycontin wearing off yet? trouble getting more?
having withdrawals?

#21 bruce on 04.18.12 at 9:37 pm

When it is over it is over -for last one out -please turn off the lights

#22 ak_forty_seven on 04.18.12 at 9:40 pm

if the banks fail, cash in any currency will suck. if we ever reach that point- owning physical metals would be the way to go?….sorry garth.

No Canadian bank will fail. — Garth

#23 naga on 04.18.12 at 9:41 pm

Garth – Eventually rates will go up – when is the ?. C may well have pulled the best head fake yet.

As fellow bloggers have pointed out still lots of volatility in EuroLand, in US and other places.

Still a 50/50 poposition if rates go up later this year.

Today’s post – as in any market a few samples at the extremes do not make up averages or median statistics nor trends. Yes most Canadians are rethinking their sorry state of Debts that they have accumulated – both foreign and local investors distorting GTA, Van and possibly other markets – media always looking for juicy stories and have been reporting the etreme buying at the high end – but also lots of reports on the potential risk of a correction.

Last week in good old south Mississauga – Ok hood walking distance to go train – 50 ft lot, park in the back, close to good schools – basement separate entrace – 3 Bd – 1 Bath around 1300 sq ft bungalow listed for 439,000 – within my buying criteria.

I got greedy thought could be had under $400K – sold for $430. With $20K upgrades and some sweat could have had two incomes – main floor $1200 – $1400 plus bsmt for $800 or so. Or put in $30K and go for a quick flip – no RE agent and possibly make $50K.

Instead decided to do a diversified investment in a portofolio of securities will be getting first divident payout in early May around 7%.

I decided not worth waiting for the ever coming RE correction and continue to sit on the sidelines.

#24 Devore on 04.18.12 at 9:45 pm

That’s what happens when people run into the debt barrier. No more money can be borrowed. Thus average selling prices stagnate. I bet if you break down the market into price segments, there’s a point where sales drop off dramatically. Bidding wars for $1M houses reach $1.2M, while $1.2M listings sit deserted. You can see this in Victoria, you can see this in Vancouver. Expensive Vancouver houses (but not expensive enough to attract flashy HAM) sit on market for months. Oh heck, HAM’s gone too, that’s why Vancouver average just cratered.

#25 John G. Young on 04.18.12 at 9:46 pm

“The property was, like me, seductive but not life-altering…”

Well, reading and posting on this blog has certainly been life-altering for me — not always easy, but on balance extremely valuable. Thank you.

Oh yeah, and I learn about real estate and personal finance too.

BTW the process you described in tonight’s post: disgusting, IMHO.

#26 Mainlander on 04.18.12 at 9:46 pm

There is only one reason why a house does not sell, price and price alone. You can argue neighbourhood and schools and transportation but all houses sell in all neighbourhoods, just a matter of price. With the amount of listings hitting the Vancouver market and so few sales we will see what happens.

#27 Dan in Victoria on 04.18.12 at 9:48 pm

FTP @ 10
Here, read this.
Read the whole thing.

http://patrick.net/housing/crash1.html

#28 Renting in the GTA on 04.18.12 at 9:51 pm

Upper Unionville – Releasing in May 2012

These 4 builders are pretending to have some morals:

http://app.scsend.net/?q=email/view&group_idno=5834419&outgoing_idno=6060635&email_idno=685

#29 Sisca on 04.18.12 at 9:56 pm

Here is little story about bidding- wars in lotus land when it comes to renting a place…. I came to Canada 9 years ago and it never occured to me to buy a place untill I had my second child. Well, it was too late for us by then. So 6 mths ago we started looking for something bigger to rent in West Van. We couldn’t believe what expected us: first – landlords don’t like children (no surprise here, just their bluntness was somehow shocking), second – when there is a nice place on craigslist, there are tons of people at the showing and one bidding-war after the other (” bonus up front”, “higher rent”, you name it). The craziest thing just happened last weekend: beautiful house, great location, everything renovated, poor layout though. Asking $3000. The next day we got the information, that unfortunately the landlord would love to see more applications in order to make a decision… Why on earth does some one not accept the only but very decent offer if it wasn’t for getting a bigger profit out of a bidding-war? There is no personal approach anymore, no interest of the landlord in the place itself, no long term vision… Money rules this part of the world – it makes me sick (hopefully not homeless).

Thanks, Garth, for your daily update – it keeps me sane!

#30 Ric in gta on 04.18.12 at 9:56 pm

As a baby Boomer I seen this before. A build up of crazy buying, then one morning the bottom falls out. I can remember as if was yesterday. The builder wanted $470,000 for a house in the GTA in 1989 I said no. I bought the exact same house in 1990 $345,000 in a better location. So history will repeat, just wait.

#31 Metro reader on 04.18.12 at 9:57 pm

Any of your blog dogs caught the front page article in the Metro transit newspaper couple days ago? A realtor bought something like a 12X14 feet garage for land appreciation purposes! Can’t make this stuff up!

#32 Keeping the Faith on 04.18.12 at 10:02 pm

STEVENSON … I forgot to add

… sucks to be you, because the pain is just starting …
(cue evil laughter) HAHAHAHAHAHAHAHA

#33 Herb on 04.18.12 at 10:02 pm

The Toronto RE desease seems to be spreading. Here is a listing for a house “auction” in Belleville, ON, the first time I have heard of such a thing in over a year of watching that local market – http://www.realtor.ca/PropertyDetails.aspx?&PropertyId=11801043&PidKey=704847785

I may have to attend out of idle curiosity.

#34 First time poster (now second) on 04.18.12 at 10:04 pm

#18 Keeping the Faith
I don’t understand why I get abuse for simply asking for people’s assessments (ideally Garth’s) of the odds of something dramatic happening in the next two years. I have been reading this post for a while, and I know Garth’s rule of 90 (I said I had other investments, maybe I shouldn’t have given any back story). Obviously I’d love house prices to fall dramatically tomorrow but Garth forecasts 15% total and there are risks in cash. I’d just like some odds estimates to make a better decision.

#35 unhappy house hunter on 04.18.12 at 10:06 pm

In the past two days two different Toronto radio stations talking about housing bubble for all the same reasons Garth has been saying. Most callers other than realtors agree. It is going mainstream. Real concerned about Cdn debt.

#36 Rene on 04.18.12 at 10:08 pm

Just watch me. — Garth

Always love the Pierre Trudeau quote. One of my favs.

#37 mac on 04.18.12 at 10:13 pm

No. Mr. Turner. Prices in Vancouver are not “tumbling”. SFHs in in-demand areas are still getting astronomical prices. Condos are sitting for a while before selling. Maybe you can get 5% off. 50% of pre-sales sell out to HAM in one day. The other half? The developers don’t care. They need 50% to start the big dig.

I’d say a $100,000 average price reduction across the urban region is a tumble. Sales volume decline of 29% is also worth noting. — Garth

#38 furst on 04.18.12 at 10:21 pm

FURST!! Watch me!

#39 C on 04.18.12 at 10:22 pm

Garth,

The babe’s ok. Good taste in chicks tell lots about someone :)
Now.. the auction part… much like everything it goes both ways .

http://www.propertyauction.com/Residential-Real-Estate-Auctions-in-Florida.cfm

No one there saw it possible only a few years ago. I know I know… Canadians are special, etc etc etc but there is no reason why Toronto would not see the 1.5 mil orgy going for 1/10 that.

http://www.foreclosuredataonline.com/

I know I know.. those are the pesky Americans.. we are sooo much better :)

keep coming with those babes Garth. Posterity will be forever grateful :)

#40 Devore on 04.18.12 at 10:27 pm

#29 Sisca

Money rules this part of the world – it makes me sick (hopefully not homeless).

It’s not the money, it’s the speculation. Real estate investors are not interested in the income potential of the property, only its price appreciation. You’re lucky it’s for rent at all, most simply sit empty. Bubbles create misallocations of capital, and damage the community and society in all manner of obvious and subtle ways. The professionals who do not move here due to high prices, the artists and young people who leave, the displacement of families to the suburbs, while perfectly livable houses in prime neighborhoods sit empty, the deterioration of rental stock, as cap rate on rental properties is worse than a checking account making finding and holding a good tenant too much of a hassle. The overbuilding of studios and tiny 1 bedrooms for “young single professionals” that investors crave due to their (relatively) low cost, and a dearth of rental housing for families (while rental price is a logarithmic function of square footage, purchase price looks more like a hockey stick making larger properties absolutely atrocious as an income investment).

Who wants high real estate prices again?

#41 C on 04.18.12 at 10:35 pm

Garth, I bet you one Grey Goose vodka bottle vs anything you want to booze that within four years span there WILL be at least one major Canadian bank going bankrupt.

Whether they’ll mask this with a sudden amazing merger (paid by the tax payer) I would not know but I will be waiting for my bottle :)

At least.. send me a congratulatory e-mail for I deserve it :)

Put the Goose down. Good. Now step away from the keyboard… — Garth

#42 FTP - First Time Poster on 04.18.12 at 10:45 pm

@ #10First time poster

Who is this imposter smearing my good name?

#43 mac on 04.18.12 at 10:56 pm

“I’d say a $100,000 average price reduction across the urban region is a tumble. Sales volume decline of 29% is also worth noting. — Garth”

Those are the stats. I’m sure Abbotsford and Langley are feeling it. Not here in Vancouver. Sorry. There’s a difference between reading about it and living it.

REBGV stats do not include Abby or Langley. Deal with it. — Garth

#44 no name on 04.18.12 at 10:56 pm

Re: #38 Mac – Garth’s answer, per the usual, blows off the question in far too glib a fashion. When Garth refers specifically to “Vancouver’ prices he is of course not referring to the Greater Vancouver area. And if that is the case, he is just plain wrong and can’t seem to either deal with it or explain his answer in any type of respectful and intelligent fashion. “Vancouver prices (i.e. anything west of Boundary Road) have not dropped to the extent he is saying. And I say this as a person who thinks Vancouver prices are absolutely insane and ridiculous. So Garth, why not knock off the blow off responses and deal with the actual reality of “Vancouver” prices. Or you can just consider rewriting the same column every post – and I’m sure you would never do that.

Keep drinking it. Mmmm. — Garth

#45 Meh on 04.18.12 at 11:01 pm

Garth, been following your blog for a while now. My wife is finally on board to sell our Willowdale condo (pretty much paid off) and rent for a while to ride this insanity out. And to boot we’ve got a rugrat under 2 and another one on the way! It’s a crazy sign of the times when we gross close to $170k/year and still can’t even afford a nice house in our boring North Toronto hood.

#46 Paul on 04.18.12 at 11:01 pm

Someone’s not worried about RE in Victoria.

http://www.timescolonist.com/business/projects+Bear+Mountain/6477616/story.html

#47 Don on 04.18.12 at 11:01 pm

Hi Garth

Thank you for pointing out once again that prices can still tumble even if rates remain low. Everything has a tipping point and as prices rise and keep rising the fire will burn itself out as people start to turn their attention to other favors. EVERYTHING has a natural tipping point very hard to judge when but it is inevitable.

#48 Mr Buyer on 04.18.12 at 11:04 pm

Just to refocus a bit here. The disease is the policies enacted by the present government and all the rest are simply symptoms. If I lower the cost and requirements to borrow money for house purchases and home equity loans for whatever reason (quasi QE or whatever) I fully expect a run on borrowing and a huge spike in Real Estate prices. PERIOD. This bubble was initiated by our trained economist of a leader and his party and keep the focus upon them at election time. They may have imagined that they were going to keep the bubble up in the air indefinitely but we long passed the time at which there was any real control over this disaster. Every warning is a cover my butt move and no more than that, but it is contributing to roping more into this calamity. THE BUBBLE HAS TOPPED. EVEN IN TORONTO. ON THE WHOLE THESE BIDDING WARS ARE MERE OUTLIERS. BUYER BEWARE. DO NOT BUY INTO A FALLING MARKET AT PEAK PRICES. SALES ARE FALLING ACROSS CANADA. BTW it is a real estate bubble, not a credit bubble.

#49 Narrowgate on 04.18.12 at 11:05 pm

Sheer lunacy! Sounds like a Monty Python skit or something! People have lost their minds! It’s hysterical out there in the Toronto market.

#50 getreal-tor on 04.18.12 at 11:08 pm

#19 TS on 04.18.12 at 9:33 pm
“””
stop blaming Real Estate agents. They’re hired to make the most amount of money for their clients.
“””

Really? What is next, you will tell us that bank robbers secretly give back 15% of the money via charities?

Let’s see realtors switch to a fixed dollar rate vs percentage and we’ll see how quickly they work in your favour… Besides, as a buyer, isn’t the realtor also supposed to get /me/ the best deal? I don’t see too many bragging how they saved their buying customers a lot of money.

Let’s call a spade a spade, realtors are in it to earn their commission and the higher the sales prices, the bigger the commission cheque.

#51 Not 1st on 04.18.12 at 11:10 pm

The boomers are quietly busy unloading their over-priced shacks to the next generation of unsuspecting hornies, only the laws of demographics are not on their side and this asset is likely to never see these kinds of highs again.

Take 9 million home owners out of the market and replace them with about half that many new buyers and you will see what the result is – oversupply.

#52 Not 1st on 04.18.12 at 11:13 pm

Garth, can a person who is underwater on their mortgage create a company, move the house over to the new entity and then declare bankruptcy thus protecting all personal assets from siezure?

No, but you could sell to aliens. — Garth

#53 Victor on 04.18.12 at 11:16 pm

Bank of Canada takes aim at home equity lines of credit

Apr 18, 2012

The Bank of Canada sounded the alarm on growing household debt on Wednesday, taking aim in particular at the growing tendency of Canadians to take out lines of credit using home equity.

While the Bank has repeatedly warned on household debt levels in the past, on Wednesday it provided more detail about the type of debt Canadians are taking on, including its concerns about the rapid growth of so-called HELOC’s (home equity lines of credit).

“Like any financial innovation, home equity lines of credit have both positives and negatives associated with them,” Bank of Governor Mark Carney said during a press conference in Ottawa. “The issue, as with any debt, is if these innovations or this access to debt is taken too far.”

http://business.financialpost.com/2012/04/18/bank-of-canada-takes-aim-at-home-equity-lines-of-credit/

#54 AprilNewwest on 04.18.12 at 11:17 pm

According to someone in the know? Canadian % rates will go up after the US election so that fits somewhat with what Garth wrote “.. between June and… reindeer…” days…….

#55 Not on the Boat on 04.18.12 at 11:21 pm

Watching a show on HGTV tonight. Sponsored by… National Bank of Canada. Huh?

Mortgages. Duh. — Garth

#56 BC Bring Cash on 04.18.12 at 11:29 pm

Real estate agents are parasites on society. They get paid enormous amounts of money for doing virtually nothing. They don’t build things, look after sick people, fly airplanes, or in other ways provide a net benefit to the rest of us. Their goal is to hyper inflate RE for their own benefit and at the same time make RE more and more unaffordable for people to raise their families. What a bunch of leeches.

What do you do? — Garth

#57 truth hammer on 04.18.12 at 11:41 pm

Lucky ‘jilted’ buyers going home with 1.25 that they didn’t piss away on a pyramid scheme about to collapse. They might not know yet that they dodged a bullet….they will. TO doesn’t get it..this is their first real estate boom since 1979/80…..and now the papers have told them they’re ahead of the action in Vancouver…..this has set off the ‘rivalry’ response…..they think they’re ‘winning’….( where’s Charlie Sheen when you need him?) What idiot signs a 30 years deathgrip at the height of a bubble and survives?

The media has bred a frenzy…people have been suckered…..but as anyone knows it’s always the frenzy before the fall of every bubble…..back in ’79 there were fistfights on the front lawns for the same dumps…days before the collapse…..same in Vanc…..this is a true sign of the end……I feel like one of those nutz with the sandwich board…’the end is nigh’……..Bwahahahahah…at least i get to eat….more than I can say for so mant of these suckers who can’t afford beans after the mort-taxes-maint-car lease program.

and btw…..toronto still sucks :)

#58 Ben on 04.18.12 at 11:42 pm

YOUNG PEOPLE IN U.S.A.

Are buying foreclosures for $1 to $500

They dropping from the 500 sq ft $1000 a month condo and moving into the 1800 sq ft Victorian

They work 20 hours a week in a restaurant

It’s a new trend

Source? — Garth

#59 Carpe Diem on 04.18.12 at 11:45 pm

Renting for at least 1.5 year in Ottawa West …

I love my home + 2 acres for the monthly price of a townhouse owner. Included in the price is snow removal, grass cutting, and all kinds of maintentance this home has.

And all the extra cash ends up in RRSP’s, TSFA’s, RESP’s and non-registered accounts … I might average 2% on those investments but my kids love the land and the home, I feel no risk, and I plot what to do when prices do go down and melt afterwards ….

#60 charles on 04.18.12 at 11:48 pm

After reading today ‘s G. post, I just have one big conclusion: I dont see a correction in RE period.
:

#61 nonplused on 04.18.12 at 11:49 pm

Well, the craziness in Toronto isn’t affecting Calgary as much. Prices are still stupid high, but still haven’t made new highs over 2007-2008 so it’s been 4 or 5 years of go no where for now. Is this what a “melt” feels like?

One thing that has changed is that if you list it 30% over appraised value nobody views it, and massive price reductions follow after a few months. But they are generally still over appraisal even then.

What I am most worried about is pipelines. With all this shale gas and Keystone and what not Alberta (and BC) are seriously looking to be land locked if we don’t build some serious pipelines to the west coast. I’m think 5 bcfd gas and at least a million barrels per day crude. Soon. Like, start digging today and ask permission later.

Interesting election coming up too. Wild Rose has the lead, it’s looking like the Reform Party on a provincial scale. Alison should have given more thought to how Albertans were going to view an activist government that buys votes and implements a dogma filled agenda without a mandate from the people. Bye-bye Alison, Alberta will take anybody but you after that. Well, not NDP or Liberal, but anybody else on the ballet.

I’ve been to a fundraiser dinner (not on my dime mind you) for Daniel Smith and the Wild Rose, and she isn’t as crazy as the PC’s make her out to be. But even she isn’t prepared for what’s coming if we don’t get some pipelines to the west coast toot-sweet! Redford has no idea, she thinks the gravy train can only get bigger, so I’m glad she won’t be around.

There are serious headwinds coming for Alberta. Namely that our chief export, Natural Gas, isn’t worth half what it costs to produce because the US suddenly found they had lots of their own. But it’s compounded by the fact we can’t get any new oil production to market unless we send it by train, which is a $40 dollar discount. And there is only one line running to Fort Mac, so you can only move so much by train and then the price just keeps going up because there is no more capacity.

State side the gas surplus is already bringing down Chesapeake energy in a dramatic fashion, but there are lots of other gas producers dying on the vine. All by itself this is going to be enough to cause another banking crises 1 to 2 years out because these guys cannot service their debt at current prices. On the oil side the prices are all good but the problem is that gas heavy energy producers, even if they have oil bearing properties, can’t raise the cash to drill them because they borrowed to drill gas and now that’s worth sh!t and they aren’t going to be able to service their loans once any existing hedges come off.

#62 Jeff on 04.18.12 at 11:57 pm

“Yesterday I wrote about the inevitable and coming increase in interest rates. But higher rates are not a prerequisite for real estate’s temple to fall.”

Ding ding ding! Rates will not fall because Carney is scared s__tless of a housing bust, but the bust will come nonetheless when people start doing the math comparing buying versus renting, or the banks start to fear the train wreck enough to quit pouring more mortgage debt on the fire

#63 Ben on 04.18.12 at 11:59 pm

#59 Ben
Source? — Garth

It’s on TV right now in Dallas on kera.org

They were talking about hard hit places like Detroit.

#64 Nemesis on 04.19.12 at 12:08 am

“Just watch me.” — Hon. GT

Why does that remind me of the sound of heavy lift tandem rotors and boots double-timing up the ramp… I seem to recall a problem with mail boxes, too…

#65 P & T S on 04.19.12 at 12:36 am

Consider that all the “applicants” were cheerfully (??) prepared to pay an almost astronomical figure (almost certainly THE most costly single lifetime purchase) with neither warranty (actual or implied) or even a formal inspection?

Would YOU be prepared to buy a Rolls or Bentley, for over the listed sales price, with not the hint of a warranty, and no, you can’t even drive it around the block to see if it maybe worthwhile??

Just re-read History – this is EXACTLY the same mania as was seen in the “South Seas Bubble” and “Dutch Tulip Mania” – and we know how these manias ended.

No matter whatever happens now, the final result is inevitable – if the mania is prolonged, history indicates that the final collapse will be particularly abrupt, with no time for participants to bale out. If the “correction” starts even now, the illiquidity of RE as an asset class will prevent rapid sale (unless the vendor is prepared to take a significant loss – and evidence now is that few, if any, are prepared!), so even the “slow melt, best event” scenario option seems very unlikely.

The financial consequences of this mania will be felt for decades into the future, and for very many, quality of life is going to take a big, and permanent, hit.

“There are none so blind as those who will not see”

#66 Nostradamus Le Mad Vlad on 04.19.12 at 12:40 am

-
“Keep drinking it. Mmmm. Put the Goose down. Good. Now step away from the keyboard. No, but you could sell to aliens. — Garth”

Aaahhh the paradoxeseses of life, but I will investigate the latter to see what regs. have to be met.

BTW, good post. Didn’t understand a word of it! Greed is good and greed kills.
*
#12 shanks — Hi shanks. So we’re shaking on both sides now. Squash the middle, we’ll be okay in the southern interior. 3:09 clip FYI — worldwide. Cheers!
*
Debt 1 (re-mortaging), Debt 2 (cellphone plans) and Plummeting Profits; Expensive Vacations too costly; Cdn. Commuting Costs; Headline is . . . well partly right; Facebook Sucking the contents of your wallet; Nokia Going down? Eurozone Tensions and Spanish Bailout (with Paella); Suez Canal Traffic (chart); HOOPP Some pension plans are holding their own; Bob The Bear Turning Bull?

LA and California Speeding toward the end of a cliff (link in); Defaulting Spain; Japan’s Brazil Nuts; IMF jackasses; Oil Embargoes Why is gas so high? Prince Charming sued by wife; Yesterday India, Today Brazil (rate cut); The Brady Bunch We’re doomed; Good Credit in 12 states; China What’s going wrong; Florida RE; One Chart for China, and Chinese Agriculture; Deutsche Bank The monopoly money has run out, now the fun starts; Copper Still being stolen in England; US$3.8 tri. Isn’t the US Fed bailing out some part of Euro LaLaLand?
*
The Exorcist Rides Again This time in Saskatoon; Secret Courts Guantanamo Bay Cdn. style? Three Lies about food; Black Boxes in autos by 2015? Architecture in Japan; disciple – The British Empire; Android vs, iPhone and Apple TV; Venice and Japan Sinking like a sunset?

#67 Cy on 04.19.12 at 12:46 am

#62 nonplused

“What I am most worried about is pipelines. With all this shale gas and Keystone and what not Alberta (and BC) are seriously looking to be land locked if we don’t build some serious pipelines to the west coast.”

You can keep your dam pipelines to yourselves. People in BC don’t want it, go ship it East.

#68 Knut on 04.19.12 at 1:03 am

I don’t think Canadians are getting it. They’re in total denial, and they are acting like pigs in heat. Surely they can’t really believe they’re exempt from a housing crash. Talk about a bunch of people who could very well need to learn how to read – If they could read, then they’d have already understood and avoided what happens when you ignore all the proven signs of a crash. And you really do try to impress with your “education” system? Stupid, stupid, stupid.

#69 Puzni on 04.19.12 at 1:09 am

Close to one-quarter of Canadians willing to enter into house ‘bidding war’: BMO report:

http://www2.canada.com/nanaimodailynews/news/story.html?id=6481714

#70 $$$BPOE#1 on 04.19.12 at 1:10 am

25% of Canadians now willing to get into Bidding Wars. Lookin Good! 25 years and you are free as a bird. The renter is a bird trapped in a cage after 25 years of rent payments down the drain and facing extreme poverty in old age as rents rise with inflation. The homeowner is free, free from payments, free from the burdens of life

#71 FTP - First Time Poster on 04.19.12 at 1:15 am

Absolutely pathetic!

http://www.edmontonjournal.com/business/Close+quarter+Canadians+willing+enter+into+house+bidding+report/6481714/story.html

What it should read is: “25% of Canadians suffer from mild to severe brain damage”

#72 99% on 04.19.12 at 1:32 am

Why are you guys all over Garth with -

“Vancouver prices aren’t dropping. Are you guys trying to sell on Granville Street? Or SW Marine Drive? The ones with 10 signs on 1 block that have been there so long that we use it as a landmark when giving directions? Or do you own a Burnaby condo which offers $5000 bonus to the selling agents because it’s in such high demand? Or Richmond, BC, a suburb of Vancouver with close to 50 new listings per day, the same price reductions, and single digit sales?”

Yeah, the west is hot. Bring on the bidding wars. NOT!!!

#73 Debtfree on 04.19.12 at 1:39 am

@62 there is a serious pipe line to the west coast and it is going to double its capacity by more than double . Uncle joe Oliver is going to push it through no matter what any of the majors are saying . They are saying no to a super tanker a day out of the port of Vancouver . Alberta oil . The cheapest in the world . The cons are going
To make nothing but friends in van and the gulf islands .
If you need proof look up Kindermorgan . You guys in Ottawa and Alberta get the money ,we get the risk . I guess that’s fair trade right . Now if harper could only finish what that drunken liar hero of his promised . He might be the hero he worships . But I doubt he could ever think that deeply. He could use a little help from smoking man . Write him an email smoking man would you. And you better hurry because BC is going all orange on you buddy. And that’s going to be nothing other than your biggest head ache Steve .

#74 Kilby on 04.19.12 at 1:48 am

Wednesday night at the $540,000 waterfront condo in North Vancouver, hot water isn’t working. This hasn’t been a problem for months. …. The sump pumps that keep the lower parking area from flooding have been replaced three times in the last year and are still a problem. Glad we are leasing as I can’t imagine what this place will be like in 5 years for the strata council. Leasing does have it’s benefits.

#75 Derek R on 04.19.12 at 1:52 am

#35 First time poster (now second) wrote:
I don’t understand why I get abuse for simply asking for people’s assessments (ideally Garth’s) of the odds of something dramatic happening in the next two years. I have been reading this post for a while, and I know Garth’s rule of 90 (I said I had other investments, maybe I shouldn’t have given any back story).

Just the way it is, FTP. No point in trying to understand it. Some people like to bite.

Anyway to answer your question as best I can without knowing which part of Canada you live in or when the correction will arrive there, I would say this. Wait for the initial big correction (which may not be that big if you live in, say, Moncton) then buy. The drop should happen within the next eighteen months, so comfortably within your “window of wifely forbearance”. Then don’t worry about it. Sure, you will lose equity over the first years of ownership but as long as you obey the rule of 90, you should be able to grin and bear it.

Good luck.

#76 Derek R on 04.19.12 at 2:14 am

Garth, not sure what the big deal is about sealed bids and closing dates. Nearly all houses in Scotland have been sold this way for the last 100 years or so, come rain, come shine, come boom, come bust and yet house prices in most areas of Scotland remain cheaper than in most areas of England. And people seem to survive the disappointment of submitting a losing bid.

The real cause of high prices isn’t the bidding process: it’s cheap and easy mortgages from the banks, well paid jobs within a reasonable commuting distance and low property taxes. As long as that combo exists, prices will remain high. Doesn’t matter whether sellers use the standard offer process, sealed bids or a public auction. But as soon as taxes, interest rates or unemployment rise significantly, house prices will fall.

#77 Peter Pan on 04.19.12 at 2:43 am

The S*&t for brains people participating in these staged “bidding wars” probably spend 2 months researching the features of their 52 inch LED TV, but only manage setting aside 20 minutes thinking over the biggest purchase of their lives.

You can’t save people from their own stupidity.

#78 Mike on 04.19.12 at 4:17 am

#64

Detroit’s a war zone. They were paying police officers to move down there last year… $15k down + $150k free renovation money for a $60k house and the police didn’t bite:

http://realestate.msn.com/blogs/listedblogpost.aspx?post=5fb504b1-9866-4637-b4e2-c046abe53996

#79 Devore on 04.19.12 at 4:22 am

Case in point, this recent comment on VCI describes what is going on in Squamish, a Vancouver bedroom community, one of the last few “affordable” locations where folks commute 1+ hour each way to work. Houses over $600k are. not. selling. The MoI in this market segment reaches 11. That’s 11 YEARS, not 11 months.

There is a similar thing happening in Victoria, somewhere around the same price point, where houses. are. just. not. selling. Ditto for even the hyped up markets in Vancouver and Toronto, where the fever pitch has pushed the price limit a bit higher, but here too it is very easy to find lots of houses that sit on market month after month well beyond the regional average, once you move past the magic price point.

And if DA had any decency, he’d be feeding us this kind of information on the Kelowna region, instead of blowing unicorns and sunshine up our butts. Tell me there’s not over 2 years inventory in the $1M segment (and probably much lower prices too).

Happy real estate spotting.

#80 NoName on 04.19.12 at 6:33 am

#62 nonplused on 04.18.12 at 11:49 pm

“…Daniel Smith and the Wild Rose, and she isn’t as crazy as the PC’s make her out to be.”
Or meybe She is.
“Wildrose renews idea of Alberta ‘firewall’ within Canada.”
http://goo.gl/P0H0t

I think that Albertans got all this wrong, everyone is pumped up over “Alberta’s firewall”, we want this we wont share that… it’s not going to work, how they are going to get nat. gas or oil to the coast if not thru the bc, and you need fed. gov. to influence parties, to change their mind regarding pipelines.

What Daniall is saying it may resonate with “guy in a trucks with testicles hanging from the trailer hitch”, but in real life is actually doing disservice to whole province. Remember at one point of time Alberta was have not province, maybe daniall’s parents remeber, and statements from wild rose about albertas firewall, is only doing it’s best to alienate Alberta from rest of the Canada…

Fact is that with all newly discovered shale gas americans are gearing up for LNG export, they don’t want our nat. gas (not yet anyways), they have plenty of theirs.
In order to curbe demand for foreign oil, and to develop new drilling, I can see dem. stalling any pipe line, as long as they are in power, and by the looks of it Obamya is about to get more wotes from women, tnx to tweet from Romney’s wife.
“I made a choice to stay home and raise five boys. Believe me, it was hard work.” with net worth of 200M, now imagine how this resonats with woman that work and they strachng every dollar as far as they can.

i am wondering, maybe daniall is watching bit to much of the geln bakc…

Maybe I’m wrong…

#81 Stupesing in Cabbagetown on 04.19.12 at 6:50 am

Is this another story we will be reading at some future time in Canada? http://www.dailymail.co.uk/news/article-2131192/Interest-mortgages-How-million-Britons-sitting-time-bomb.html

#82 NoName on 04.19.12 at 6:59 am

forgot to add this

http://i39.tinypic.com/191nc1.jpg

#83 };-) aka DA on 04.19.12 at 7:21 am

#29Sisca on 04.18.12 at 9:56 pm
So 6 mths ago we started looking for something bigger to rent in West Van. We couldn’t believe what expected us: first – landlords don’t like children (no surprise here, just their bluntness was somehow shocking),

Any landlord with any degree of compassion will avoid renting to people with children simply because they know well in advance how difficult it would be to muster the fortitude to enforce the rules and evict such a family putting those innocent children on the street. Can you imagine the conflict one would be forced to endure? Yet the landlord’s bank isn’t going to forgive a month or two’s mortgage payment when due on that rental property because those children’s parents were financially irresponsible and reneged on their obligations. Why ever would we even consider going there in the first place when there are so many childless renters who present no such potential moral conflict to overcome?

And then there are tenants with pets. Few landlords will allow pets for fear of the damage a pet will do to the property. In my experience those pets do less harm than their owners. On the other hand, due to the lack of rentals where the landlord will allow pets and the attachment of the pet owner to their pet, prospective pet owning tenants are willing to pay a lot more rent for a lot less house. Pet owners will bid against one another for the opportunity to pay exorbitant rent for a ramshackle run down shack. Cha-Ching!

If you want to have a family or a pet you should buy a home not rent one. If you can’t afford to buy a home then you probably can’t afford to have a pet let alone raise a child.

#84 TurnerNation on 04.19.12 at 7:23 am

So much for immigrants coming to GTA with bags of cash, buying houses?

http://www.thestar.com/news/article/1163791–pressure-builds-in-brampton-to-pass-basement-suite-bylaw

Pressure builds in Brampton to pass basement suite bylaw

Published On Wed Apr 18 2012

Brampton residents are riled up over an issue that has divided the city along cultural lines, with immigrant groups demanding that basement apartments be legalized while others remain steadfastly opposed.

“Immigrants want the basement apartments; they need them,” says Councillor Vicky Dhillon. “There’s intolerance from some people.”

#85 TurnerNation on 04.19.12 at 7:25 am

Cont.: “But Saini agrees with Gibson about the enormity of the issue. “Most newcomers can’t afford new houses or high rents.””

#86 Bigrider on 04.19.12 at 7:30 am

Garth, for the houses mentioned in your missive today, are you certain you have the street names and locations correct?

Just googled addresses and areas and only Churchill is at Yonge and Finch.

They are correct. — Garth

#87 Bigrider on 04.19.12 at 7:39 am

Anyway, day after day this blogs commentator as well as various posters make the subject matter of the blog more complicated than it actually is.

The fact of the matter is people hate the financial markets right now, with consistent net redemptions from equity like investments for several years now globally, while real estate in T.O and Vancouver is absolutely worshipped.

The rear view mirror has always been the methodology of investors.

Until growth resumes in the financial markets and/or some catalyst implodes the RE market, expect status quo.

You are getting boring. — Garth

#88 Ret on 04.19.12 at 7:43 am

Lots of activity at the Cornerstone project on Dundas (Hwy. #5) in Burlington on the weekend. Younger Middle Eastern families mainly, kids in tow, looking at high 600′s-low, 700′s, 2600 sf homes on 43 x 80 foot lots. Early twenties sales agent informed me that prices are about to go up soon.

Two weekends ago, ditto at Empire homes in Brantford only prices were $300-350,000 for a vinyl clad box with a few hundred bricks on the facade.

And a few words for Brother Carney. Don’t count on that next step up, IMF job as a world financial leader if you blow this Canadian gig. No worries.

You could wind up working for a bank in London instead. That would be London, Ontario. Smaller yes, but just as nice.

#89 };-) aka DA on 04.19.12 at 7:49 am

#80Devore on 04.19.12 at 4:22 am

And if DA had any decency, he’d be feeding us this kind of information (somewhere around the same price point ($600K +) , where houses. are. just. not. selling) on the Kelowna region, instead of blowing unicorns and sunshine up our butts. Tell me there’s not over 2 years inventory in the $1M segment (and probably much lower prices too).

I will absolutely concur that the DOM (days on market) that it takes to sell a home over $600,000 in Kelowna gets longer and longer the higher you go in price. I will also confirm that the market for homes over $1mil is significantly softer than it once was and that there is indeed not just 2 year’s worth of inventory in the $1mil plus market segment but actually 5 years’ worth of inventory in that market segment. In the past 12 months there have been 78 sales of homes priced at $1mil or higher and there are currently 398 available for sale.

What is interesting though is that; despite the falling numbers of $1mil plus sales, which would otherwise skew the average home price, their absence has not really affected that average so much. And while $1mil plus homes are a relatively insignificant part of the “total unit volumes” in any event, unit volumes have actually remained consistent and more telling, in terms of holding the average price reasonably consistent, gained strength despite the retreat of that $1mil plus segment. You see where I am going with this don’t you Devore? Let me spell it out for you…

While you are trying to paint a dismal picture and somewhat succeeding in so doing by telling the truth about a particular market segment you are missing the whole truth and very real fact that the market is doing just fine – so well in fact that it easily circumvents the failings of that market you use as example in trying to make your point. Thus your point is – moot at best in the eyes of the average person. I might even suggest that many would regale in this matter as they welcome the demise of the demonstrated in your face opulence of that McMansion market and the Phoenix rising of the modest abode market such that the latter demonstrates a return to real and true sustainable values both monetarily and morally.

#90 AKatz on 04.19.12 at 7:50 am

Once I went to a showing of a small townhouse in Oakville. The real estate agent told me about the day/time to accept the offer. I did not have any agent for myself. He asked to meet with us at Starbucks, brought a contract (to be our agent) and asked us to sign without ever read it. I refused, he said that if he was my agent he could disclose some information to make it easier for me to “win”. He brought all other offers with him and showed to us the highest one. Then he said: “if you want the house…”.
He also offered a “cash back” after the deal…
I was very upset and just left.
Here is the guy: DELETED

File a complaint. Don’t libel him here. — Garth

#91 House on 04.19.12 at 8:01 am

So just out of spite you are not going to recogmize RBC`s 2nd Annual Realtor Appreciation Week. See that`s how one “professional” treats another “professional”.

#92 Time to leave Canada for a better life on 04.19.12 at 8:03 am

Looks like Canada is done for people looking for a better life. There is no opportunity no hope for a good life just sadness and working like a slave just to live. My parents left their country to come to canada for a better life and now I must leave this horrible debt slave country for a life of freedom and living. Canada sucks on so many levels. You want a job to work like a slave and live in cities it will cost you a life time of slaving just for a home. The US is now the land of opportunity where one can work at micky d’s and live in a 2500sq home and live like a king in a warm climate. Canada you sick and I hope parts of canada sinks in the sea that’s how mad I am about this crazy loose lending of money to those who can never and will never pay that debt off. Thanks Carney and the other criminal cons. Canada is officially a POS country with no future.

#93 timbo on 04.19.12 at 8:06 am

http://www.telegraph.co.uk/finance/financialcrisis/9212241/Fitch-doubts-Dutch-AAA-as-property-slump-reaches-coma.html

“The Netherlands is caught in a “negative feedback-loop” as recession and house price falls feed on each other. Building permits have dropped 9pc from a year ago, the lowest since 1953. “The housing market is in a coma,” said the Volkskrant newspaper.”

Europe is not recovering and it looks like it is going to get even worse…..

http://digg.com/newsbar/topnews/uh_oh_subprime_lending_comes_roaring_back

“The number of subprime borrowers — people with credit scores of 660 or lower — issued new credit cards shot up by roughly 12% over the past year, the New York Times reports, citing data from credit bureau Equifax. The article tells the stories of people who have gone through bankruptcy, had cars repossessed and even were sued by debt collectors — who are getting a slew of direct-mail offers for credit.”

Ah..lets try this again, it’s bound to work sooner or later.

http://photoblog.msnbc.msn.com/_news/2012/04/17/11251527-87-million-california-mansion-heads-to-the-auction-block?lite

$87 million and no takers?!

#94 Time to leave Canada for a better life on 04.19.12 at 8:09 am

Right now we must be seeing all the stupid crazy and dumb people who got 2.99% money going out and spending the money they will never pay back with hopes of getting rich. When it crashes they will all walk and go bankrupt and the banks will run to the taxpayers for the money. CHMC is a BAD and wasteful use of taxpayers money. Taxpayers money should never be used to help people buy a home. This is stupidity .Canada isnow a garbage no future country all thanks to CONs.

#95 };-) aka DA on 04.19.12 at 8:11 am

#80 Devore on 04.19.12 at 4:22 am
And now you have sufficiently pissed me off that I think it time for me take my leave and climb aboard my Bavarian breed steed to take up the challenge of navigating the less predictable the curves in the road than those of your lame attempt to discredit me.

So before I get too pissy for the Dawgs it’s time… ROADTRIP! Why? Because I can. My boss is a jerk but he can’t fire me for taking the day to blow off a little steam, or even the year for that matter if I choose. };-)

http://youtu.be/5KIDVA6ESjw

#96 J.I.M. on 04.19.12 at 8:30 am

Check this out:
http://www.wptv.com/dpp/news/region_c_palm_beach_county/palm_beach/the-zombie-files-nearly-7000-stagnating-foreclosure-cases-lie-dormant-in-palm-beach-countys-court

What’s interesting is , the reasons why mortgage holders don’t want to foreclose:

Fear of flooding the market with distressed properties that will crash prices.
Concern over getting a clear chain of title.
Unwillingness to take on maintenance and liability for a property.
Negotiating a loan modification or short sale.
A homeowner files for bankruptcy, putting the case on hold.
Problems with paperwork or how a previous law firm handled a file.

Note the number one reason , fear of flooding the market and depressing prices!

#97 John G. Young on 04.19.12 at 8:45 am

#95 };-) aka DA on 04.19.12 at 8:11 am

“And now you have sufficiently pissed me off that I think it time for me take my leave…”

Smart move.

Buh-bye.

#98 Ben on 04.19.12 at 8:51 am

#79 Mike

That article is over a year old

#99 timbo on 04.19.12 at 9:11 am

http://www.zerohedge.com/news/initial-claims-propaganda-101

“Instead of printing at the expected 370K, an improvement from last week’s already big miss of 380K, this week came at a whopping 386K, the worst standalone print in 4 months. Well, until last week’s revision that is: instead of the 380K print that stunned everyone, last week’s number has now been revised to a massive 388K. Why? So that mainstream media can declare, with a straight face, that this week saw the number of initial claims decline! ”

yup, revise the jobless claims up from last week and then declare a drop this week.

watch the headlines folks.

#100 Raging Ranter on 04.19.12 at 9:23 am

@ #2 John G, it’s always been ugly in Winnipeg. It just got a little uglier yesterday. Spent the first 35 years of my life in Manitoba, including 15 in the Peg, but you couldn’t force me to move back there at gunpoint. If I did, it would be to some remote corner of the province where I could live cheap and largely under the radar (and I do mean radar – the photo radar tickets in Winnipeg have become a blatant cash grab).

#101 Mike on 04.19.12 at 9:24 am

Hey Garth, I love reading your site from work, and a recurring theme is pics of babes front and center (which might not bode well in a work type setting). Is there a place where this blog can be read sans the babes.

Thanks, Mike

Never. — Garth

#102 The American on 04.19.12 at 9:32 am

At #59: Ben, you are right. As for source it was on Public Access last night here in Washington State. It was a very interesting show, and I know this is happening for a fact. My younger brother and his wife in Florida purchased a foreclosed condo for $40,000 cash (I know that isn’t $1-$500, but it is still very cheap). They now have a two bedroom/two bathroom 1,200 square foot condo completely paid for. It has afforded them, at the ripe age of 28, the ability to work as much or as little as they chose. Currently, he is working about 24 hours a week, and she is working full time. She said she could cut back but prefers the work environment she is in, so she will continue full time. He now does the cooking, cleaning, walking of the dogs, shopping for groceries, and laundry. Before the real estate bust, they both were easily working 50 hours a week to keep up with their ridiculous house payment on a home they had purchased for $430,000 (that was an expensive home in Florida at the time) that dropped to less than $210,000 in a matter of three years. They literally look back on their lives from only a few years ago and they have no idea how they managed to take care of the home, manage the household and finances, and both work 50 hours a week. Needless to say, they’re much more relaxed and calm today. The new generation is choosing quality of life over material possessions. They’re choosing financial freedom opposed to financial chains. This is indeed a trend for the younger crowd in the U.S.

#103 bigrider on 04.19.12 at 9:32 am

#88- Garth to Bigrider- ” you are getting boring”

Are you serious? Boring ??…and the repetitive nature of your message everyday…how would you describe that ?

I described a bidding war in a unique time. Feel free not to read it. — Garth

#104 };-) aka DA on 04.19.12 at 9:45 am

#100 John G. Young on 04.19.12 at 8:45 am

Oh, don’t worry Sweet Cheeks, I’ll be back. };-)

“There is nothing like returning to a place that remains unchanged to find the ways in which you yourself have altered.”

#105 safetypup on 04.19.12 at 9:46 am

I lived in the SF Bay Area for a long time, and brutal bidding wars with at least twenty offers were and still are very common. Imagine competing against people holding thousands of Google, Apple, Oracle etc..(and soon Facebook) stock options.

That being said, nobody is holding a gun to the heads of buyers. Buyers need to take responsibility for their actions.

PS The personal debt ratio in the Netherlands is 250%!!!! versus 150% in Canada.

The government there and in a few other European countries started allowing consumers to deduct their mortgage interest on their primary residence, and guess what the outcome is.

#106 getreal-tor on 04.19.12 at 9:49 am

http://protectyourprivacy.ca/2012/04/why-privacy-matters/

TREB President, @richardsilver, discusses “Why Privacy Matters” in his new blog post.

Richard sounds like a robot in the blog posts.

#107 AG Sage on 04.19.12 at 9:52 am

First time poster,
The bottom of this market will not be V shaped. You will have a lot of time to decide where your entry point is.

here is a chart showing the U.S and UK declines Notice that the U.S. is called a crash, but does that really look like a crash, month by month? No, it’s an erosion. People don’t acknowledge the crash until it’s a given and then they assume the entire drop happened overnight.

Interest rates can only go down a tiny bit farther (if they do at all) so this game is in the final minutes and there will not be a stimulus this time, with the possible exception of some locales who try to bribe first timers like you to jump in and bail someone else out.

The other option is to view it as charity. Find some deserving boomer with no retirement plan and bail them out…

#108 John on 04.19.12 at 9:52 am

6 blocks from my home there stands a 20 some odd story condo, with all units sold, newer building, completely empty.

Why?

Because on February 27th 2010 at 3:34am a mega 8.8 earthquake hit Santiago. This newer building somehow shaved Chile’s very strict building code and is cracked from top to bottom. All had to leave. The building will never again be occupied.

What sense would it make to talk about real estate dynamics for these owners. Interest rates? Tragi-comical bidding theatre? Equity? Investment comparisions? All irrelevant.

If we’re not talking about the foundations, we aint talking. Everyone ends up the greater fool.

#109 Foggy on 04.19.12 at 9:58 am

@95 Time to leave
“…Canada sucks on so many levels. This is stupidity. Canada is now a garbage, no future country all thanks to CONs…
———————-
I’m sensing some disappointment and anger in your statements.

#110 eaglebay - Parksville on 04.19.12 at 10:08 am

#68 Cy on 04.19.12 at 12:46 am
#62 nonplused

“What I am most worried about is pipelines. With all this shale gas and Keystone and what not Alberta (and BC) are seriously looking to be land locked if we don’t build some serious pipelines to the west coast.”

You can keep your dam pipelines to yourselves. People in BC don’t want it, go ship it East.
________________
Wrong, people in BC want and need the pipelines.
We also have tons of oil and gas to sell, up in the Peace Country and other areas of BC.
The technology is there and the tree huggers can stuff it. It’s the economy stupid and the jobs are needed.

#111 eaglebay - Parksville on 04.19.12 at 10:15 am

#74 Debtfree on 04.19.12 at 1:39 am
“@62 there is a serious pipe line to the west coast and it is going to double its capacity by more than double”
________________
Double, double.
The pipeline is already there and will and should be expanded.
The common sense people know better.
So you go from pink to orange. Ha……

#112 Time to borrow and leave Canada on 04.19.12 at 10:21 am

Let’s face it Canada sucks and it’s time to leave. Before you go you should steal as much borrowed money as you can. I have lots credit on credit cards $50K but the real money is HELOC so one much buy a house (ALL ON BORROWED MONEY) and try to put down as little money as you can. Can I buy a home in the US and then go bankrupt in Canada while not touching the US assets? Does one need to go bankrupt here and then buy a home in the US? Forget about Canada blog dogs its a huge country full of stupid people and there is no future in Canada. I love Canada but one must open their eyes. The US is the future where one can buy house and live a good life without being a working class slave. We should use this blog to help educate ourselves on how to leave Canada with the most money to start a goodlife in the US.

#113 Babblemaster on 04.19.12 at 10:26 am

Garth’s observations are all keen and his logic is irrefutable. However, his predictions of a correction and rate increase have all been, thus far, incorrect or at least very premature. Interest rates have remained insanely low and Carney is powerless to raise them. Banks have been fearless in lending money and Flaherty won’t do anything to stop them. The buyers themselves gulp down debt like sweet kool-aide. Very insane. So, sure it’s dangerous to buy now and this gasbag has got to blow sometime, but when? In the meantime, anyone who has listened to Garth, myself included, has missed out and has watched the irresponsible win big.

It just goes to show, you can’t predict the future.

Actually you can. You would not make such comments if you were sitting in the Okanagan, on Vancouver Island or most of Ontario outside of the GTA. Don’t be so regional. It’s a bad strategy not to look past your own backyard and see what’s coming. — Garth

#114 Bolo2k12 on 04.19.12 at 10:28 am

@ #28 Renting in the GTA (Albert),

I sure bet you hope that you’re one of the “chosen” ones aren’t ya, bud?
Isn’t it frustrating that you won’t get to line up 72 hours in advance just to be “furst”?

#115 John G. Young on 04.19.12 at 10:32 am

#107 };-) aka DA on 04.19.12 at 9:45 am

“Oh, don’t worry Sweet Cheeks, I’ll be back. };-)”

And I’ll be watching, Honey Bun.

“There is nothing like returning to a place that remains unchanged to find the ways in which you yourself have altered.”

You haven’t changed a bit.

#116 Canadian Watchdog on 04.19.12 at 10:42 am

TD Waterhouse: Four-in-five condo buyers in Toronto (81%) say they worry about being able to afford their mortgage payments.

https://research.tdwaterhouse.ca/research/public/Stocks/NewsArticle/ca/TD?documentKey=100-188c6868-1

#117 maxx on 04.19.12 at 10:47 am

#58 truth hammer on 04.18.12 at 11:41 pm

“What idiot signs a 30 years deathgrip at the height of a bubble and survives? ”

Those who believe that they’ll get fat pay raises YOY whilst keeping their jobs forever, win a mega lottery, inherit tons from ma and pa (or maybe even auntie Em), flip the dump and gorge on the profit, never give a second thought to funding retirement, borrow because it’s easier than doing almost anything else in life and/or think that the laws of money don’t apply to them.

Scares me to think how this affects the health of the real economy. Kids should be taught to be allergic to debt at a very early age. I love my parents.

#118 Daisy Mae on 04.19.12 at 10:54 am

#19 TS: “Nobody is above personal responsibility.”

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

‘Greed’ is a human frailty. The government made it easy, the banks made it easy….

#119 Nonno Nicola on 04.19.12 at 10:59 am

#87 Bigga Rider

Heya Bigga Rider, gooda to see ya backa. Nonno Nicola was in the Campania regione of Italia in Marzo to see hisa famiglia. You gotta upadate Nonno Nicola on how your investimenti in da stocka marcato are a going and ifa youa making any moneta with da real estata. My famiglia in Italia all own la terra and are enjoying da vino, formaggio, prosciutto and olio di oliva all mada in casa. Please responda Bigga Rider.

#120 Bolo2k12 on 04.19.12 at 11:00 am

Garth,

Why don’t you take over for Carney and “right the ship”?
You can give F a kick in the pants as well.

You can have as many amazons as your personal assistants as you please.

#121 Just(not)AnotherSheeple on 04.19.12 at 11:06 am

Re #72 Puzni and #72 FTP

Close to one-quarter of Canadians willing to enter into house ‘bidding war’: BMO report:
======================================

Coincidentally around that number Canadians work as “public servants” in one or another form.
These guys have their financial future GUARANTEED by the Government of Canada (one of the few AAA countries left in the world).
Their present salaries, their future movement in the “grid”, their golden defined benefits pension plans for 50-60-70% depending of years of service, their early retirement, their ….. are perceived to be at least inflation protected and cast in stone.

So with their future financially sound and guaranteed why not take a little risk with the RE – after all everyone knows that $3k-5k/month as mortgage payment NOW will have different purchasing power for the same 3k-5k five years or 10 years down the road…

So until this perception is not shattered and with the low interest for the foreseeable future there wont be any letting go. After all you have to put your “hard earned” money into something hard or the inflation and the financial markets will eat them away.

#122 T.J. BONES on 04.19.12 at 11:11 am

Sir Garth: Is that Sherry S. Cooper? I see the boots, but not the “Pearls”.

#123 OrangeBull on 04.19.12 at 11:13 am

Garth, is Alberta the only province in Canada where you can walk away from a house, without any consequences, even if the value goes down? (same like in US?)

#124 truth hammer on 04.19.12 at 11:19 am

Cheap psych tactics now deployed…..talk about subliminal…..really below the belt stuff……the auto companies use these tactics all the time…you know the ones…’your dick will be bigger if you drive an SUV’…..or…’the 20 yr old girls will overlook that your fat and bald if you’re driving an XYZ’………and now the real tards lobby is taking the same road….attack !!!

http://www.vancouversun.com/business/mortgages/home+buyers+unwilling+enter+bidding+report/6481790/story.html

BC BUYERS !!!!! YOU’RE WIMPS………YOU DON’T HAVE THE BALLS TO BID…..YOU WIMPS!!!!!!! YOU PUSSY!!!

#125 metta on 04.19.12 at 11:21 am

#29 Sisca,
I’m in the same boat as you. We moved around so much that we never got into real estate market in Vancouver. We are now a family of 4 with two little kids jammed into a 960sqft suite in North Van and unable to upgrade to a 3 bedroom even if my husband makes decent money. We want to move to West Van for school but rents are ridiculous. North Van in sought after areas are similar too. Either rent or buy, North shores are for the already uber rich. We are thinking of leaving the city.

#126 metta on 04.19.12 at 11:24 am

By the way, I was glad to hear that average price has gone down in March but my friend just told me that single houses still sell really fast over the asking price in sought after areas of North Van. Her friend also sold her place she bought two years ago with a huge profit.

#127 Mixed Bag on 04.19.12 at 11:33 am

#52 Not 1st on 04.18.12 at 11:10 pm

The boomers are quietly busy unloading their over-priced shacks to the next generation of unsuspecting hornies, only the laws of demographics are not on their side and this asset is likely to never see these kinds of highs again.

Take 9 million home owners out of the market and replace them with about half that many new buyers and you will see what the result is – oversupply.
———————————————–

It’ll be a number of years before the larger houses trickle down to attractive prices. By then my spouse and I will be near early 50′s and kvetching about sore backs and knees, and not wanting to move to anything multi-level, however attractive it may be. Hooray for Gen-X. Silver lining: smaller house = less cleaning.

Just in time for Gen-Y and millenials to move up.

#128 Rental Monkey on 04.19.12 at 11:33 am

#84 DA:
F U and the leased bimmer you limped in on. To say that if you can’t afford to ‘own’ you probably can’t afford a pet OR a child? Your sense of grandiose is pathetic and clearly skewed.
You really are a pathetic troll. Garth; I thought there was collective agreement to ban this DINGHEAD. Give me Nosty, Smoking Man and the firsts/fursts anyday.

Oh, and the taps of Kool Aid, are still flwing heavily in Vic. Reality hasn’t started to sink in yet……but it will.

#129 Snowboid on 04.19.12 at 11:36 am

So the snowboids are back from the land of sun, sand and scorpions – albeit chilled and losing our tans (after trying to claim refugee status in Arizona – US Immigration wouldn’t believe Canada had been taken over by an evil dictator).

As mentioned, we were going to ask for a renewed lease with lower rent.

Landlord had decided to sell, so we low-balled 25% off asking. He was not amused. “Sorry, but condos are a big risk in the Okanagan now”, we said, “and that is all we have to put on the table.” In a year when it is still for sale, we may consider offering 30-35% less than asking. There are so many listings here with an expired ‘Best Before’ date it’s crazy – prices are ‘sticky’ – sales are ‘nil’.

So we went looking for another rental, at first a bit worried (house horniness is still hard to shake), then amazed at what was available for the same we were paying for our big, but aging condo.

The ‘resorts’ are hurting here – obviously the investors are too – when their advertised monthly rent is much less than what they used to ask for a week in the summer! Even the Okanagan Grand is offering summer monthly rates! Methinks they are not expecting a vigorous tourist season this year.

After looking at about a dozen places we decided we wanted a newer condo, with amenities and close to downtown – but not a resort (too noisy). We ended up with an almost new, upscale condo – a bit smaller but much nicer – for the same rent.

Again, thanks Prof Turner – once again your advice has made our day!

#130 Sticky on 04.19.12 at 11:46 am

@#115 Time to borrow and leave Canada
“Can I buy a home in the US…”

>> You can’t legally live in the US indefinitely, nor legally work there unless you have a work visa. You can buy a house, and visit it though.

If Canadians could, many more would have moved there all ready.

#131 Knucklewalker on 04.19.12 at 11:55 am

No Canadian bank will fail. — Garth

Canasia has too many trees still.

#132 Horny RE Virgin on 04.19.12 at 12:07 pm

Thanks for the blog and insights Garth. I’m not that horny anymore. I’m going to send it to my horny 20-30 yr old friends too.

#133 Debtfree on 04.19.12 at 12:23 pm

@ 114 ebpv . and you go from some big time operator to a renter . And I suppose you rent your boat as well . I think you’re just a guy with not much but a keyboard and poor out look . I’ve always been orange province since Dave Barret days. And liberal until that idiot Martin destroyed them when he gerrymandered sheila right out of the party . I ‘ve never voted communist . Unless what you mean by your pink remark That you are gay baiting in a most gutless fashion . Your out of luck there as well . I love the fairer sex too much . I find you less and less believable with every post you write . I hope Garth doesn’t ban you from this blog . You are one of albertas greatest ambassadors .

#134 Jim Lahey, Trailer Park Supervisor Extraordinaire on 04.19.12 at 12:28 pm

# 125 Just(not)AnotherSheeple

Your summation of the situation in regards to civil servants and the housing market is spot on. Readers take note. I’m sure the bearded oracle, all knowing prophetic seer who runs this blog understands this too but can’t come out and say it as it would probably lead to his mysterious disappearance. Headline would be, “former minister of national revenue and popular blogger disappears after posting a blog on how civil servants in Canada are bidding up the prices of Canadian real estate”.

#135 HomeWatcher on 04.19.12 at 12:34 pm

FWIW listings up here in the Easter Valley – Chilliwack – are stale, rusty and corroding fast, with homes I watch being listed for more than a year, pulled, and relisted, with no success. This corrosion is spreading to the Eastern Abbotsford area and further and is dragging down prices across the whole area up here. Most homes listed I watch have dropped asking prices by 15 percent and still almost no movement on sales.

#136 Two-thirds on 04.19.12 at 12:37 pm

Increasingly aggravating occurences, as the BoC might put it.

Speaking of the BoC, in reading their monetary policy report, it appears that Mr. Carney is facing a classic catch-22 situation, namely:

“Despite recent improvements to the outlook for the
global and Canadian economies, risks remain elevated.

The three main upside risks to inflation in Canada relate
to the possibility of higher-than-expected oil prices,
stronger-than-expected growth in the U.S. economy and
stronger momentum in Canadian household spending.

The two main downside risks to inflation in Canada
relate to a reintensification of sovereign debt and
banking concerns in Europe, and the possibility that
growth in Canadian household spending could be
weaker than projected.

So, in other words, if household spending is too high, it will intensify inflation (triggering rate rises and pain for the borrowers), whereas if it is too low, it will eliminate the need for interest rate rises, as inflation would trend down (and debt would go up).

That in itself is one tough balancing act (more like choosing between a rock and a hard place), but the BoC also stated:

“The Bank projects that private domestic demand will account for almost all of Canada’s economic growth over the projection horizon. Household spending is expected to remain high relative to GDP as households add to their debt burden, which remains the biggest domestic risk.”

Or:

Economic growth = domestic demand = household spending = debt = biggest risk

To quote our host: This will not end well.

#137 AACI Okanagan on 04.19.12 at 12:47 pm

#90 };-) aka DA on 04.19.12 at 7:49 am
While you are trying to paint a dismal picture and somewhat succeeding in so doing by telling the truth about a particular market segment you are missing the whole truth and very real fact that the market is doing just fine – so well in fact that it easily circumvents the failings of that market you use as example in trying to make your point…

Your nose is growing. What you are failing to get, is that the gap between the starting point of the “upper end” homes is getting very close to top end of the mid-level homes and that is not a good thing. Something has to give, especially when no one is taking advantage of it. As the upper end start to tumble it creates downward pressure on other sub-markets..

#138 JohnG on 04.19.12 at 12:51 pm

I know that interest rates will rise. But are they supposed to?

Besides deficit spending, why would Government inflate the money supply? Inflation eats savings, and is a trade off of future production of the citizens – it’s that or taxes I guess?

Can someone explain why inflation exists if we assume no deficit and that the money supply is tied directly to production?

J

#139 It's Different Here on 04.19.12 at 12:52 pm

Co-worker said that home prices will never drop in Toronto because too many immigrants with cash keep flooding into the city buying into a culture of houses.

Couldn’t convince her otherwise.

Any help?

#140 Oceanside on 04.19.12 at 12:56 pm

#73 99% on 04.19.12 at 1:32 am
Why are you guys all over Garth with -

“Vancouver prices aren’t dropping. Are you guys trying to sell on Granville Street? Or SW Marine Drive? The ones with 10 signs on 1 block that have been there so long that we use it as a landmark when giving directions? Or do you own a Burnaby condo which offers $5000 bonus to the selling agents because it’s in such high demand? Or Richmond, BC, a suburb of Vancouver with close to 50 new listings per day, the same price reductions, and single digit sales?”

Yeah, the west is hot. Bring on the bidding wars. NOT!!
___________________________________________

Richmond has 2,457 active listings and in the last week there have been 177 price changes and only 131 sales.

East Vancouver had 114 price changes and 137 sales in the same time.

Nothing hot here anymore…

#141 Bailing in BC on 04.19.12 at 1:03 pm

#80 Devore

Thanks for the plug. Even I couldn’t believe what I was seeing when I punched in those numbers. I had to check and recheck to make sure I hadn’t made a mistake. It is exactly what Garth talks about when he speaks of an illiquid market. Who can say that their house is worth $800k if no one will buy it?

I feel for the people who are still piling into the $400 and $500k market, which is the max that the average person can afford (if they are willing to put every cent they have and the majority of every cent they will make in the future into a house). When the higher priced owners get serious about moving their properties the people on the bottom will get wiped out.

#142 Rob .T on 04.19.12 at 1:07 pm

Does anyone know of an etf that would short Canadian residential real estate. Or the best way to execute this another way. Besides not buying anything right now

#143 Devore on 04.19.12 at 1:16 pm

#90 };-) aka DA

What is interesting though is that; despite the falling numbers of $1mil plus sales, which would otherwise skew the average home price, their absence has not really affected that average so much.

What you see as “interesting” as see as a natural consequence of the fiscal regime we are in. Of course the average has not changed, because people still generally spend as much as they can afford on a house, and this is dictated by how much they are able to borrow, something which has not changed in a couple of years, give or take. What HAS changed is the kind of house they are getting for their money. In Kelowna they are buying increasingly nicer houses, in what are de facto price drops (price per sqft). In Toronto they are buying increasingly decrepit tear downs. The average purchase price is still the same. As they say, price is what you pay, value is what you get.

This is what an index like Case-Schiller would be able to show us, which tracks sale pairs. We know there are price drops in Squamish, because many of the houses selling today are going for below their purchase price 3, 4, 5 years ago. The average doesn’t show us that, and neither does the benchmark.

The lack of availability of the data to support this is unfortunate, for both buyers (who don’t know what is going on in the market and may end up overpaying) and sellers (who cannot price their properties properly), instead all must rely on the realtor information firewall to do the analysis for them and provide them correct information (good luck for most of them).

#144 eddy on 04.19.12 at 1:19 pm

Here’s a Yonge Eglinton house that sold for 830k a year and a half ago. listed 3 weeks back for 1,078,000. no visible improvements, didn’t sell, price just increased to 1,278,000.

http://www.realtor.ca/propertyDetails.aspx?propertyId=11728296&PidKey=-1940512577

#145 good times on 04.19.12 at 1:29 pm

The only people making good money today are people in the public sector… there are some in the private… but when janitors in schools make 6 figures you know the world is upside down… they work hard… but many things just don’t make sense… spend spend spend ontario mcguilty premier.
Housing is crazy… and makes me angry watching people just spend money like it’s free. The princess margaret home in oakville is for sale. Never lived in… lucky bugger is going to clear at least a couple of million…
I’ve never worked more and made less money… it’s really amazing… I hear more and more people saying the same thing. It’s tough not to get discouraged now a days.
The only advice I have for people… stay out of debt. Invest wisely… don’t try to keep up with the jonses… keep plugging away. Eventually when the insanity dies down.. and the markets correct… we will come out on top. Being debt free and loving it… it keeps the stress level to a minimum.

#146 In Ottawa on 04.19.12 at 1:30 pm

Update on a friend,

This person bought a Condo in Ottawa’s Market in 2008, small 1 bedroom unit. Taxes about $2000/yr, Fee’s $240/mth initially listed for 270K, no offers, just 7 viewings. Eventually, relisted a month + later for 240K. Finally sold last week for 230K, this person will walk away with only 5K after everything. This person is really upset because they missed out on a lot of opportunities for travel and fun due to a higher owning cost versus renting, about $1000 a mth. It’s not different here..

#147 John on 04.19.12 at 1:35 pm

There is a house on Cloverhill Road in Toronto (see mls.ca for details). Looks good, but seems to be an exception. Listed in Dec. 2011 for ~670K. The price lowered 4 times. Now it is 559K, down 110K… :)

#148 Pbane on 04.19.12 at 1:35 pm

#129 metta

Burnaby is not nearly as bad. I rent a 1,150 s.f., 2-bedroom + den newer highrise condo near Central Park for $1,675. The assessed value is $612K and monthly condo fees + taxes alone are $585. I estimate that about 20-25% of the units in this building are rented out. Within a 2 km radius I can count at least 8 new highrises (most over 40 storeys) being built or starting soon. There is decent rental selection around here, but of course it’s not the North shore. I would only consider buying this unit if the price was around $400K or the rent was over $2,250.

And don’t think that just because a speculator pays $800K for one of the new 950 s.f. 2-bedroom condos that they will get the $2,500+ rent they want to help cover their massive mortgage. They may ask for it, but almost nobody around here will pay that much. That’s why all the new buildings are half empty. And when that assumed 10%/year price appreciation stops, uh oh.

#149 Technical Analysis on 04.19.12 at 1:37 pm

There is also aspect of the RE that not many know – the technical one. First, the engineers and architects are pressed by the developer to do 6 months work of designing condo building in 6 weeks. Then the result of 6 weeks emergency mode work, the pornography on paper known as the “contract documents” goes for tender. During the tender time, dozens of addendums are sent to the bidders, who also work in emergency mode to meet tender submission deadline. Then the cheapest bidders got the contract and the second phase of porn begins, this time on the construction site. Hundreds violations from the Ontario Building Code and the contract documents is a norm today. By the end of construction, the design consultants are twisted by the developer (who pay them to review the construction) so they submit the sign off letters to the City and the occupancy permit could be obtained. City building inspectors, those would be construction cops understand construction less than my grandmother (one told me “I agree that the concrete column is not installed well, so I will have contractor to reinforce it with 2 x 4”). In the end of the day you pay $500,000 for “Lada” packed and priced as “BMW”.

BTW you will certainly recall my message after major seismic event shake your city…

#150 jess on 04.19.12 at 1:52 pm

James Banks
Kings who erase debt slate and slaves

King Enmetena’s edict:
He instituted freedom (amargi) in Lagash. Restored the child to its mother and the mother to her child and cancelled all interest due. The very first such declaration on record and the first time in history that the word “freedom” appears in a political document.(page 216 chapter 8 Credit versus Bullion and the Cycles of history.
David Graeber Debt The First 5,000 years.

. “King Entemena ruled in 2400 BC, when the land that makes up modern-day Iraq was a cradle of civilization. …”

http://en.wikipedia.org/wiki/Lagash#cite_note-5

The growing alternative mortgage industry.
and the growing alternative trading boards.

#151 Devore on 04.19.12 at 2:00 pm

#145 Bailing in BC

When the higher priced owners get serious about moving their properties the people on the bottom will get wiped out.

Specifically, motivated sellers with significant equity will move the market, regardless of the whining and pain this will cause.

DA mistakes the fact real estate activity is occurring as a sign that everything is still fine. “Hey look, people are still buying houses, things are fine, you’re just a doomer”, says he. There are ALWAYS transactions. On the day/week/month the US financial markets cratered, thousands of people went out and bought houses. Someone will always buy, someone will always sell. That’s why we look at things like volume, inventory, price/sqft, sale pairs, you know, trends.

He reminds me a lot of our regular VCI poster who shall remain nameless, whose posts generally consist of a dozen different ways of saying ‘since we can’t predict the future, we should just stop talking about it, because it’s all speculation, and one course of action is just as good as any other, stop thinking about it, just do it’.

But that’s not true. We don’t know the future, sure, but we know the present, we know the past, and we have entire bodies of science, hard and soft, that we CAN use to predict the future. Or at least predict what a sane or likely future might look like. Is it a sane future where houses keep rising 10% a year while incomes stay flat? Economics (and basic math) tells us no. Is it a sane future where house prices are flat for 10 years while incomes/inflation/whatever catch up? Psychology tells us hell no! So not all actions are equal, because not all outcomes are equally likely.

Well, time to head out for lunch, drive safe all.

#152 Junius on 04.19.12 at 2:08 pm

#81 NoName,

I fully support a firewall in Alberta so long as none of them can get out once it is completed.

#153 Foggy on 04.19.12 at 2:14 pm

CTV news on bidding wars:

http://www.ctv.ca/CTVNews/TopStories/20120419/housing-bidding-war-20120419/

#154 Junius on 04.19.12 at 2:18 pm

#143 It’s Different Here,

The immigration argument has been exhausted on this Blog many times over the years. You still have people like TRT who come by weekly to pump it up.

Immigration just adds to the demand side for housing but traditionally all immigrants have been absorbed by new supply. Canadian immigration rates have been consistent for decades. If they didn’t cause prices increases in the past why now?

The cause of the bubble is cheap credit. It is the supply of credit that has fuelled it not the supply (or lack of) of housing. Immigration remains high in many other countries where prices have crashed or continue to fall. How does your colleague explain that?

#155 Van grrl on 04.19.12 at 2:19 pm

aka DA:

“If you want to have a family or a pet you should buy a home not rent one. If you can’t afford to buy a home then you probably can’t afford to have a pet let alone raise a child”.

This statement makes little sense when there is so little difference between a renter and “owner” in a city like Vancouver. Almost NO ONE can really afford to buy. That’s what this blog is all about- have you not been following?? That mentality is exactly why so many Cdns are being duped into buying ridiculously overpriced homes. I rent space from someone and they rent money from a bank. That’s it really. And they are given the illusion they ‘own’.

#156 betamax on 04.19.12 at 2:26 pm

#147 Devore: “In Kelowna they are buying increasingly nicer houses, in what are de facto price drops (price per sqft).”

Absolutely. My father just bought a condo in Kelowna for less than assessed price, but it was also the nicest, most well-built condo of the many that he looked at. He simply bought more for the same money (proceeds from the sale of property on Van island, with $$$ left over).

#157 steev on 04.19.12 at 2:28 pm

#95 Time to leave Canada for a better life

Forgive my paraphrasing…

You: Housing is about to correct ergo Canada sucks.

Me: Boy am I lucky to live in Canada where I have the luxury of watching all the other corrections play out before mine does. Else I’d have to go through it totally unprepared.

#158 kilby on 04.19.12 at 2:30 pm

149 good times on 04.19.12 at 1:29 pm
The only people making good money today are people in the public sector… there are some in the private… but when janitors in schools make 6 figures you know the world is upside down.
————————————————————–
What an absurd statement! Where are school janitors making six figure wages? throwing out inflammatory statements like this does nobody any good, just creates bad feelings everywhere.

#159 timbo on 04.19.12 at 2:33 pm

http://illusionofprosperity.blogspot.ca/2012/04/toilet-paper-news.html

8.6 return on investment is not bad.

http://today.msnbc.msn.com/id/40915489/ns/today-money/t/shrinking-feeling-downsized-products/#.T5BaGtX0p-g

Reducing the size is the in thing now to keep profits up.

#160 DM in C on 04.19.12 at 2:35 pm

Wasn’t that condescending troll BANNED?

#107 };-) aka DA on 04.19.12 at 9:45 am

#100 John G. Young on 04.19.12 at 8:45 am

Oh, don’t worry Sweet Cheeks, I’ll be back. };-)

“There is nothing like returning to a place that remains unchanged to find the ways in which you yourself have altered.”

#161 Pbane on 04.19.12 at 2:46 pm

#146 Rob .T

This is not advice and it’s not a good idea to mention names, but some publicly-traded candidates that do exist might be: a company that insures residential mortgages (apart from CMHC); smaller non-bank mortgage lenders / consumer financial services companies; and consumer discretionary companies closely tied to home improvement and home furnishings. BUT, it’s funny that the valuations of these are already low, so not much short opportunity.

Another way to look at it is, once the Canadian RE bubble bursts, where will the money go (what is left of it anyway)? What will be the next bubble?

#162 Cy on 04.19.12 at 2:48 pm

#113 eaglebay – Parksville

Maybe you should read some books on economics before you go spouting off about things you don’t understand. The Enbridge Pipeline is an inflationary threat and a huge ecological risk for what? Peanuts, absolutely peanuts for BC.

#163 Oceanside on 04.19.12 at 3:06 pm

http://app5.interfacexpress.com/pcs/vancouver_island/ViewDetail

Listing around Qualicum Beach

#164 Oceanside on 04.19.12 at 3:07 pm

Sorry, previous link to estate at fire sale price didn’t work 1900 Corcan Road.

#165 J.I.M. on 04.19.12 at 3:25 pm

@134 Sticky

I understood that you could reside in most western countries, including the US more or less indefinitely. This is assuming that you are a genuine resident. By genuine I mean; not working, not voting, not availing yourself of any of your host county’s social services, behaving yourself, and paying all applicable taxes. In that case , surely most countries would be happy to have you!

#166 Jim Lahey, Trailer Park Supervisor Extraordinaire on 04.19.12 at 3:27 pm

#151 John

“There is a house on Cloverhill Road in Toronto (see mls.ca for details). Looks good, but seems to be an exception. Listed in Dec. 2011 for ~670K. The price lowered 4 times. Now it is 559K, down 110K… :)”

John, I might live in Sunnyvale and imbibe the fresh Nova Scotian air and ales, line dance with Barb and have shoot outs with Ricky and host the FASTGFBDCParty but the above property in Toronto hasn’t sold for one simple reason. There is something wrong with it or its location. Any property that isn’t selling in Toronto is either grossly overpriced or there is something wrong with the home and or location. Properties without these problems are gone in a flash. A home in the Norsemen Heights area of Etobicoke (Royal York/Islington Bloor) listed at almost a million, about 2700 sq ft in need of a major internal facelift, gone in mere days. This two storey home is surrounded by 50 year old bungalows that buyers are scooping up for $650k just to tear down and build their dream home. Gotta get back to work, just heard gunshots…

#167 Jim Lahey, Trailer Park Supervisor Extraordinaire on 04.19.12 at 3:41 pm

My main man Kilby while the average janitor in the GTA does not make this amount I can assure you from inside information of someone who works in one of the school boards in the GTA that indeed there are some janitors who rake this or close to this through overtime and weekend work (big bucks paid to open schools on the weekend) in addition to their salaries..

#168 jess on 04.19.12 at 4:04 pm

from reuters:
..awesome if it is true
Bioengineered hair follicles connect very naturally with surrounding tissue. Can they growi some eyes for the shrimp / fish in the gulf.

Eyeless Shrimp, Clawless Crabs, & Other Nightmarish Effects of the Gulf Oil Spill
Discover Magazine (blog)‎ – 1 hour ago

========

Private -for -Profit
“American taxpayers cannot afford, and should not be asked, to subsidize massive advertising and marketing machines aimed at recruiting more students who are supported by federal financial aid programs,”
Online colleges were deregulated under the George W. Bush administration.

Fraudulent activities by recruiters and other employees as well as low graduation rates, among other issues.
For-Profit Art Institutes of California Accused of Swindle
By MATT REYNOLDS

http://www.courthousenews.com/2012/04/13/45603.htm

And ONE chain has false claims lawsuit by the federal government and 11 states
Tuesday, August 09, 2011Last Update: 11:57 AM PT U.S. Sues For-Profit College Chain for $11 Bil.

#169 Renting in the GTA on 04.19.12 at 4:04 pm

#117 Bolo2k12 on 04.19.12 at 10:28 am

I was planning a longer wait…

#170 eaglebay - Parksville on 04.19.12 at 4:06 pm

#137 Debtfree on 04.19.12 at 12:23 pm

Pinkos are BC liberals.
Renting while looking for the right location and price is a smart idea.
You can have your pissing contest all by yourself. Too bad you can’t read.

#171 Nostradamus Le Mad Vlad on 04.19.12 at 4:09 pm

-
#124 Timing is Everything — “Too early for a sno-cone?” — Not at all, the season is well underway. My current fav is pineapple, blueberry and raspberry topped with pecan ice cream!

#133 Snowboid — Good to see you back! “Methinks they are not expecting a vigorous tourist season this year.” — Not with the way the TSA gropes and interrogates one.
*
Love Of My Life

An old man and woman were married for many years, even though they hated each other. Whenever there was a confrontation, yelling could be heard deep into the night.

The old man would shout, “When I die, I will dig my way up and out of the grave and come back and haunt you for the rest of your life!”

Neighbors feared him. They believed he practiced magic because of the many strange occurrences that took place in their neighborhood. The old man liked the fact that he was feared.

To everyone’s relief, he died of a heart attack when he was 98. His wife had a closed casket at the funeral.

After the burial, she went straight to the local bar and began to party as if there was no tomorrow.

Her neighbors, concerned for her safety, asked “Aren’t you afraid that he may indeed be able to dig his way out of the grave and haunt you for the rest of your life?”

The wife put down her drink and said,

“Let him dig. I had him buried upside down. And I know he won’t ask for directions.”

#172 eaglebay - Parksville on 04.19.12 at 4:16 pm

#166 Cy on 04.19.12 at 2:48 pm
#113 eaglebay – Parksville

Maybe you should read some books on economics before you go spouting off about things you don’t understand. The Enbridge Pipeline is an inflationary threat and a huge ecological risk for what? Peanuts, absolutely peanuts for BC.
_______________
Give me the names of which economic books you’ve read so that I can make sure that I don’t read them. Doomer.

#173 Sticky on 04.19.12 at 4:28 pm

@#149 good times

>>What janitor makes 6 figures? I know of cops in their early to mid 20′s making 80+K…but no janitors.

#174 It's Different Here on 04.19.12 at 4:31 pm

Thanks Junius!

I tried it.

She said: “The ones coming here have more money.”

Hmmmm.

Also, nice summary #153 Technical Analysis!

Plus, I know personally that lots of these new developments get green lit to build on contaminated land…from corrupted inspectors.

One of my good friends quit her job as an inspector, because of this type of immoral pressure to greenlight such projects.

Many of these new condos are built over old factory waste yards.

#175 John G. Young on 04.19.12 at 4:46 pm

#71 $$$BPOE#1 on 04.19.12 at 1:10 am

“Looking good! 25 years and you are free as a bird.”

Just like first degree murder.

My God, you are an idiot.

#176 Sticky on 04.19.12 at 4:50 pm

@ #169 J.I.M.

Canada and the USA have a agreement that citizens of either nation may ” VISIT” the other nation for up to 180 days in any 12 month period.

You can not just move to the US indefinitely, unless you have some way to immigrate there.

#177 James Banks on 04.19.12 at 5:02 pm

@#154 jess

Appropriate.

Beyond some abstract associations I can make to Washington’s bailout tactics regarding Banks and Automakers….I don’t thing there’s going to be any King Enmetena looking after us paupers.

It won’t be so bad, though.

The Chinese government will take over the world for awhile, and teach us all to work harder for much less while still managing to save sixty percent of our income, and then the Indian government will succeed them to global dominance.

From them we’ll learn to have a gigantic dance routine at the end of every movie, even if it’s a documentry. The spiritual stress release will encourage everybody to get along so much better, and the Realors will quit calling Garth bad names, and instead create an Elephant God with ten arms riding a Harley (made in Mumbai) in his honour.

Now…everybody…bright colours…and…DANCE!!!

(And don’t forget to save sixty percent.)

Bank…?

What bank?

#178 penpal on 04.19.12 at 5:05 pm

@ # 143 It’s Different Here

Why would you bother?

If you are correct, do you think she will acknowledge your insight or curse you for reminding her of her stupidity?

Ask her one question:

What major financial transaction(s) have you been involved in and what financial success have you had with said transaction(s). (track record)

I’m betting she says none.

Ask her then why she is buying after such a huge decade plus run-up to all time high prices?

Ask her what special knowledge she possess that gets her to commit to (by buying) what is historically the first mistake of an amateur investor.

Remember, when people with no investment acumen nor experience are telling you something is “a sure thing”, there are few , if any, buyers left.

Ergo, the market must contract (in transaction volumes first, then nominal price).

These are textbook bubble dynamics.

Christ people are stupid!

#179 Julia on 04.19.12 at 5:15 pm

So much for you blaming women for bidding wars:

New web-based survey of 1,000 house and condo owners found men were more willing than women to bid as much as 120 per cent of the listing price.

Only one-in-five women (20 per cent) said they would bid 120 per cent of asking price, compared with about one-in-three men (34 per cent).

http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/most-home-buyers-would-walk-away-from-bidding-war-poll/article2407323/

#180 Debtfree on 04.19.12 at 5:25 pm

@ebpv 174 with that pinko remark .I know you know nothing about BC politics . If you listen close you can hear old W.A.C spinning in his grave. You know very little about van.is. And nothing about the ocean . I would guess living there is some dream you have . People with money retire there . You say . I doubt that . The only one that I know that retired there are people that thought they had money . And I know many . Now they wish the had waited and bought in the sun belt . Where the people that really do have money retired . Not many old folks want to sit watching it rain for seven months and snow for two . There’s a reason that the moss is a foot and a half deep in the shady places.As for a pissing contest . I would show you what I have but I don’t brag . Just being debt free is good enough for me . Everyone wants to be me Debtfree.

#181 bigrider on 04.19.12 at 5:25 pm

Nonno Nicola.

Io sono completamente fed up con tutto queste casa humping, terra ossessionato gli Italiani tutti intorno a me.

Sono fortunato ad avere a spostato e nata qui a Toronto.

Capire?

Had they chosen to land anywhere else and no big builders, real estate billionaires/millionaires, developers etc. with last names that end with vowels.

#182 Form Man on 04.19.12 at 5:31 pm

#155 Devore,

Don’t expect DA to pay any attention to facts or data. He truly believes that in the face of an oversupply of homes and emergency low interest rates, buyers will come flocking back once the rates begin to rise……why ?…..because things are improving stateside. Basic grade 3 math eludes DA.

#183 Junius on 04.19.12 at 5:38 pm

#178 It’s Different Here,

She said, ““The ones coming here have more money.”

How does she know? The average person in China makes less than $4,000 per year? Who is she talking about?

The one thing for sure is almost no one is coming from a place where Real Estate prices are as high a Toronto and Vancouver AND wages as low.

If she is talking about people with 3 million or more to put down on a house what does that matter? They will only buy the top end in any event. There is a very limited trickle down effect. They won’t save Squamish, Surrey, Milton or Oakville from falling.

#184 AKatz on 04.19.12 at 5:42 pm

Libel? This is just the truth. Because of people like him we have this mess…

#185 timbo on 04.19.12 at 6:01 pm

http://yourbofa.com/

A personal letter from our CEO? lol:)

http://www.financialsense.com/contributors/gregor-macdonald/get-ready-for-hot-inflation

“Ronald Reagan once described inflation as being “as violent as a mugger, as frightening as an armed robber and as deadly as a hit-man.” Until recently, central bankers thought that this thug had been locked up for life. Thanks to sound monetary policies, inflation worldwide had stayed low in recent years. But the mugger is back on the prowl.”

nothing to see, move along now….

#186 Junius on 04.19.12 at 6:06 pm

#179 John G. Young,

That BPOE is an idiot is clearly true as he demonstrates daily on this Blog.

One thing he overlooks is that with the small down payments being made on mortgages these days fewer and fewer will actually be paid off in 25 years.

#187 };-) aka DA on 04.19.12 at 6:54 pm

#141AACI Okanagan on 04.19.12 at 12:47 pm
and
#147 Devore on 04.19.12 at 1:16 pm

There are a couple friends of mine I would like to introduce you to they go by the names of

Graph #1 Unit Sales by Price Segment
and
Graph # 2 DOM by Price Segment

Were I to introduce you to them they would tell you something quite contrary to that which you seem to hold true.

I’m sure if you search hard enough you will find my friends and they will teach you that which I apologize I have neither the time nor the patience to.

FANTASTIC Mini Road Trip BTW… Beautiful British Columbia… truly, The Best Place on Earth!

};-)

#188 Been There Done That on 04.19.12 at 6:54 pm

Your blog is fantastic Garth and have been faithfully reading for about two months!
Thought you might like this….
http://www.dbtechno.com/entertainment/2012/04/19/mark-carney-canadas-chuck-norris/
To all the others (Nost, Bubbleboy, Mr. Buyer, et al) keep up the excellent comments

#189 Just a Tech on 04.19.12 at 7:13 pm

It’s going to be really hard to find empathy and pity for people who are going to get taken to the cleaners when rates go up.

#190 MarcFromOttawa on 04.19.12 at 7:14 pm

#142 JohnG

Inflation benefits those with first access to money:
-Banks
-Governments
-Institutional investors

People with first access to that money get to invest it before prices rise to reflect the dillution in the currency.

#191 woo hoo on 04.19.12 at 7:17 pm

#104 Mike

Here are some ideas.

A. In firefox,

check tools>options>content>load images automatically

Create an exception for greaterfool.ca.

Reload page (f5) to see w/ blocked content.

B. Another option, try something like the old ghostzilla to camouflage the screen.

C. Use a text-based browser, like lynx.

#192 Nonno Nicola on 04.19.12 at 7:22 pm

#185 Bigga Rider

Ah I heara you Bigga Rider. Whadda ya gonna do? You a righta Bigga Rider in your assessamento of da situazione wid dese bigga developores. In dee enda Nonno Nicola saya dat as longa as youa got youra saluta Bigga Rider and youra famiglia hasa its saluta and you no gotta da debito, a good bottiglia di vino, gooda formaggio and a nica giardino, then who da hella cara about da arroganti bastardi in da real estata. Moneta, she justa coma and a go Bigga Rider. Dat guya who builda Casa Loma, he losa it alla in da enda Bigga Rider. You can’t buy da amore and da saluta so enjoya yourselfa Bigga Ridera and tanks for the risposta.

#193 Farmer Jim on 04.19.12 at 7:26 pm

#189 Timbo

Timbo, Ronnie Reagan had to have that line about inflation written for him because poor Ronnie wasn’t the sharpest tool in the shed by a country mile.

#194 };-) aka DA on 04.19.12 at 7:30 pm

#147 Devore on 04.19.12 at 1:16 pm

There is some truth in what you say however I see the fact that “people in Kelowna are buying increasingly nicer houses” not so much as demonstrative of price drops as they get more for their money but rather the reason prices have increased as they add more bathrooms, a theatre room, garages, granite, stainless and hardwood to their selection criteria.

The price of an average Kelowna has practically doubled in the last ten years and it hasn’t all been market increase as much is attributable to a more decerning taste of the average consumer. An average house of today is undeniably decked out more with options reserved only for the high end ten and more years ago.

Again, look up my friends Graph #1 Unit Sales by Price Segment and Graph # 2 DOM by Price Segment – they will teach you much if you are willing to listen to them.

#195 Nemesis on 04.19.12 at 7:45 pm

Yikes! I am remiss… Considering your leader illustration and TagLine, OldChap…

I really do think you ought to view this…

http://www.youtube.com/watch?v=1vA4T1wfJLE

PS – Nostra, you will no doubt entirely reassess your stance on TheYellowEmperor’s ultimate StrategicIntentions & Force ‘Disposition’… For my part, surrender seems like the sensible option. Cheerfully, of course.

#196 jess on 04.19.12 at 7:45 pm

IMF the # 1 doom and gloomer needs money!
Come on nations anti up or the euro will collapse!
Lagarde’s purse needs 400b in new money!

Question is what if it doesn’t?
The targets are unreachable , technocrats say sell off your water, sewer, statues of the past etc etc…

plebs say okay?

#197 Liz on 04.19.12 at 7:47 pm

Flogging houses in Maple Ridge – Check out this video on YouTube:

http://www.youtube.com/watch?v=JlcFXO9TVDg&feature=youtube_gdata_player

#198 Nostradamus Le Mad Vlad on 04.19.12 at 7:53 pm

-
That’s A Hint So much for Congress.
*
China’s Rise, America’s Fall The cycle change; GS Rules The World Who controls GS? Hint: TPTB; Goldman’s Vampire Squibs Seizing power in Europe; Six Steps Only 12 states have a positive credit rating; 24:49 clip Is an oil shock looming? You bet yer ass! California and LA 16 Ways To Leave Your Lover; Soros Declaring war against the Bundesbank; Mass Resignations Why? Is the end of the world nigh? The Invention of Money From Frank Zappa and The Mothers of Invention? Incoming Bailouts! 5:51 clip Elderly couple evicted from home in Dublin, Ireland.
*
Blueprints for the New World Government (Order); May – December Romance and In Praise Of The Goreacle; Killing Me Softly Drugs and food chain; Monsanto Making lives more interesting! Plus Monsanto and the bee collapse; 11:07 clip ‘Net battle on, and this incl. CISPA; 2:52 clip Smoking Man — Not a great teacher here; China Internal power struggle? Nuke Fisticuffs Between India and SKorea; NATO allies turning away from US; Taliban Making a nuisance of themselves to NATO – US forces; Divorcing Google and get your privacy back.

#199 Sticky on 04.19.12 at 7:58 pm

The trend i’m seeing in 6 months in the Southern US, 6 months in Canada…in their down sized Canadian house or condo.

Despite what many *think*…Canadians can not retire full time in the US.

#200 AACI Okanagan on 04.19.12 at 8:29 pm

#191 };-) aka DA on 04.19.12 at 6:54 pm

You still don’t get it.

#201 Ret on 04.19.12 at 8:32 pm

#85 Legalizing Brampton basement suites

Thanks for the heads-up. Let’s get rid all of these annoying by-laws in Brampton. Yippeeeeeee! I’ll be shopping RE in Brampton for sure.

I’d like to legally open a massage parlor in my living and dining rooms staffed with Amazon attendants. There is a huge need in the Brampton community for more Amazon attendant massage parlors.

As a Canadian, I need this option to survive financially and to meet the needs of my family. I trust that the immigrant community will support my new initiative in Brampton as I have supported their desires to have illegal basement suite rentals in SFH’s made legal.

#202 mac on 04.19.12 at 8:43 pm

Garth, don’t twist my words. Maybe people in the outskirts are feeling price declines. No one who had a house that was worth a million bucks 3 years ago is feeling anything but joy when they get an offer 100K less than their stupid 2.1 million dollar asking price. NO ONE with a SFH in Van East or West is feeling any pain at all. Things are still selling over asking.

Bitter, aren’t you? Patience. — Garth

#203 eaglebay - Parksville on 04.19.12 at 9:02 pm

#183 Julia on 04.19.12 at 5:15 pm
So much for you blaming women for bidding wars:
________________
Women are making men bid or men are bidding on behalf of women (wives).

#204 eaglebay - Parksville on 04.19.12 at 9:04 pm

#184 Debtfree on 04.19.12 at 5:25 pm

Blah, blah, blah. Brainless.

#205 eaglebay - Parksville on 04.19.12 at 9:17 pm

#186 Form Man on 04.19.12 at 5:31 pm

I realize that you have some kind of vendetta going with DA.
He’s an optimist and positive in his own way. A lot of his posts are quite reasonable.
He makes more sense than many of the doomers on this blog. What are you doing for your hometown?
The Okanagan is a very nice area. Too bad it’s so far away from the ocean.

#206 The Thing in the Basement on 04.19.12 at 9:20 pm

77 Derek R – re Scotland – I recall seeing that on TV. It appeared all very professional as the solicitor handled it. Seems the realtor (“estate agent”) only played a minor role with a small commish too. Wonder if it could be a new model for Canada.

105 American – can you tell us what happened with your
Bro’s old house? I’m just trying to connect the $400k house (with mortgage?) to the $40k condo purchase with
cash.

184 Debtfree. Just a story I’d like to share. Buddy retired in Crown Isle – up Comox way. Moved in in new year and was amazed how quiet it was. Within the first two weeks
of April the place came back to life as the rest of the residents returned from warmer climates. You can have it both ways.

#207 Robert on 04.19.12 at 9:21 pm

#176 Bagelboy in Peeksville: You are deluded. The Enbridge pipeline has much more to do with facilitating the war with Iran, and too little to do with building Canadian energy independence. The rush is on so that Iranian oil exports to China can be squeezed and China’s bitumen can come us when the Straits of Hormuz are closed. Wouldn’t it be a more patriotic thing to pipe the oil east to Canadian refineries and wean us off of our OPEC oil imports. How about building Canadian infrastructure instead falling back on being the usual hewers of wood and drawers of water? You can wrap the Enbridge in a flag but it ain’t ours.

#208 Form Man on 04.19.12 at 9:24 pm

#198 DA

The main reason people are buying ‘more house’ is because of emergency low interest rates. Buyers tend to max out all the mortgage they can. Developers encourage it, because there is good markup in extras ( not unlike with vehicles ). The developers are more than happy to accomodate, I can assure you. The problem now is that too many people have become buyers ( because the qualifying criteria is too easy ) and the interest rates have no where to go but up. If you believe that Kelowna or Canada is poised for a housing resurgence, you are smoking far too much BC bud……..

#209 Form Man on 04.19.12 at 9:27 pm

#209 eaglebay

There are optimists, pessimists, and realists. I am the latter, and that has allowed me to build a construction business that this year will gross in excess of 20 million dollars. I doubt I would be as successful if I were as deluded as DA

#210 The American on 04.19.12 at 9:36 pm

The Thing In the Basement, my brother ended up choosing to go into a short-sale. Due to the real estate collapse in Florida (he was a land acquisition and contracts negotiator for a major developer, and a real estate attorney), he lost his job. They could no longer afford to make the monthly payments as their savings was fast being drained to cover the difference his paycheck was covering. In the short sale process, he was awarded by the bank the “go ahead” to proceed, and he sold for $207,000 on a home he purchased for $430,000 just three years earlier. They had put 25% down on the property, so there went $108,000 out the window. This left a deficiency judgement against them for $116,000. They are now on the hook to pay this back. This is where Canadians are absolutely WRONG that Americans can just simply up and walk away from their properties. However, he was able to negotiate with the court a 20% reduction in the judgement. Still, they’re making monthly payments to the bank on a home they no longer own (nearly done paying the deficiency judgement), and they lost the $108,000 down payment. Never say it can’t happen in Canada. It is already starting in outlying areas of major cities.

#211 Cy on 04.19.12 at 9:40 pm

#176 eaglebay – Parksville

I’ve never seen so many people come out of the woodwork to advocate selling out our country to a bunch of baby killing Fascists. The Chinese Government murders babies, why do you want to do business with people like this? If it’s for money then quite frankly you’re a psychopath and need help.

#212 mac on 04.19.12 at 9:58 pm

“Bitter, aren’t you? Patience. — Garth”

Good lord. Not really. Sheesh. You’d do well to be more measured.

#213 eaglebay - Parksville on 04.19.12 at 10:09 pm

#211 Robert (booby) on 04.19.12 at 9:21 pm

Eastern Canada cannot use all the oil produced in Alberta. Dream on.
Do you know what a million barrels a day means?
Goofy.

#214 eaglebay - Parksville on 04.19.12 at 10:15 pm

#215 Cy on 04.19.12 at 9:40 pm
#176 eaglebay – Parksville

I’ve never seen so many people come out of the woodwork to advocate selling out our country to a bunch of baby killing Fascists. The Chinese Government murders babies, why do you want to do business with people like this? If it’s for money then quite frankly you’re a psychopath and need help.
_____________
Check your maps. China isn’t the end of the world.
What is abortion to you?

#215 };-) aka DA on 04.19.12 at 10:21 pm

#204AACI Okanagan on 04.19.12 at 8:29 pm
#191 };-) aka DA on 04.19.12 at 6:54 pm

You still don’t get it.

I would say it is you who does not get it AAIC Okanagan. Did you even seek out those charts I mentioned? Care to share your thoughts on that $600,000 to $750,000 market segment you know the “mid-level” market. Tell me it’s characteristics, who’s buying that product… or not, and why… tell me what the buyers and sellers above and below are thinking and then tell me what the sellers in that $600,000 to $750,000 segment are thinking and facing.

Behind the statistics and the comparables and the physical attributes or failings of the “product” there are the human emotions which I deal with every day that you do not. You appraise a house based on comparables, replacement values and depreciations – you do not deal with the human emotional aspect of it. You present your appraisal, more often to the bank than the home owner, collect your bill and leave. I am there through thick and thin helping my clients achieve their goals. Emotion drives the market AAIC Okanagan. Emotion is a big part of a home purchase and sale. A big part of my job is checking emotion at the door and bringing logic to the table. You miss the importance of the interplay of how the human condition interplays with each market segment – clue: there is less logic in it than you know.

And before I part I would like to know AAIC Okanagan why it is an appraiser so often asks me what the accepted offer price was on the home? Is it there job not to ask what it was but determine, with a 5% error either way what is should have been? And yet so often the appraisal reflects what I precisely what I told with such accuracy that I am quite sure if I added 10% it would reflect that too. But on that 5% error allowance… how many properties priced 5% over real market value do you think sell before being reduced to that more realistic price. Here’s another hint for you AAIC Okanagan, peruse the states to look at the “original” list to sell price ratio of homes which sold in 50 days or less compared those which sold in more than 50 days. That is a telling exercise. How many sold in less than 50 days had to reduce their price to get a deal? What was the “last” list to sell price ratio of each? What does this tell you?

Even the most inexperienced REALTOR has more real “market” knowledge than you AAIC Okanagan. You are way out of your league.

You haven’t a clue AAIC Okanagan… not a clue.

#216 };-) aka DA on 04.19.12 at 10:25 pm

I’m missing my favorite TV program – Two and A Half Men.

Clearly I don’t have time to proof read before I post.

You can figure it out.

#217 John G. Young on 04.19.12 at 10:47 pm

#188 AKatz on 04.19.12 at 5:42 pm

“Libel? This is just the truth. Because of people like him we have this mess…”

Before you posted #91, did you stop to think about what the possible legal ramifications to Garth could be if your accusations could not be substantiated?

This shouldn’t have to be explained to you.

#218 The Thing in the Basement on 04.19.12 at 10:48 pm

214 American – thanks for the info. A big ouch for your ‘bro but sounds like he’s digging out of it. Best of luck to him.

213 Form Man – you are an optomist in your own way. None of us would be in business for ourselves if we werent optomistic and had faith in our abilities.

#219 AACI Okanagan on 04.19.12 at 10:58 pm

And before I part I would like to know AAIC Okanagan why it is an appraiser so often asks me what the accepted offer price was on the home? Is it there job not to ask what it was but determine, with a 5% error either way what is should have been

I was ready to respond to your question when I read this and this tells me all I need to know about you. In every appraisal we are asked to analysis the sale price by the bank. We are also suppose to obtain a copy of the purchase and sale agreement so we can see if there is anything amiss. Very rarely do we have to call the realtor to get the sale price as it is given to us by the bank. You should know this. The bank always takes the value of the appraiser and not the realtor, go figure.. btw, drop by my office and I will show you some stats that should at least open you blinders. I love schooling you..

#220 Cy on 04.19.12 at 11:51 pm

#217 eaglebay – Parksville

#221 Cy on 04.19.12 at 11:51 pm

#217 eaglebay – Parksville

Like I said you’re a psychopath, straight up.

#222 bigrider on 04.20.12 at 11:28 am

#206 Mac- I kind of feel sorry for the people who sold those houses you speak of 3 years ago for the mill or so they got. Must kill them to see them go for 2.1, or 2, LOL.

Nobody ever comments on the sellers over the years, those who have watched their sold properties move ever higher. We only comment on the supposed winners, not the missed opportunity of the loser.

That’s gotta hurt. Hope they didn’t follow the bears advice (me included) on this blog LMAO.

#223 Tony on 04.20.12 at 9:51 pm

The overnight lending rate will fall to zero as Canada fades into oblivion. Carney is trying to put on a brave front but the people in the know such as myself know the real truth.