The cult

Bob Jablonski exudes cowboy confidence. “The Calgary market continues to move in the right direction,” says the real estate board president, “with all indicators pointing towards stable growth and a move towards typical levels of activity.” Apparently typical is an average SFH price of $433,500.

And up that boring road in Edmonton, head realtor Doug Singleton is thumping the Alberta Advantage. “Other markets, such as Toronto, are reporting feverish real estate activity involving multiple offers and unconditional offers,” he boasts, “but our market is calm, orderly and slowly evolving.” In oil town, a single home is now $380,083.

Arguably, with downgraded Ontario’s  new taxes on the rich, BC shrinking economically and mentally ill, and indebted Quebec trashed by students, Alberta’s looking phat. Highest average income. Hundred-buck oil. Top marginal tax rate a full 10% below that in the east. Two Amazonian political party leaders. Maybe this is as good as it gets these days.

So why is it so many people can’t pay their property taxes? As a blog dog mortgage broker pointed out, there are 220 foreclosures on the market in Edmonton alone, or about 5% of active listings. Context? “CMHC has been stressed tested to be able to handle a doomsday scenario of over 3% default rate before becoming insolvent itself, according to Canadian Mortgage Trends,” he points out.

More telling, there are about 600 properties in each city scheduled to be sold off because the owners are at least two years behind in paying their municipal taxes. The list is here. Says our broker, “These numbers serve as a leading indicator that folks are financially stretched to the limits and holding on by their fingernails. And this in a province where we have tons of jobs and apparently it’s boom times again.”

Exactly. This blog’s message is reinforced yet again: most people are screwed. Observe carefully, then run in the other direction.

Here’s more evidence. A new survey from the Association for Canadian Studies asked people if they were concerned about paying their bills. Over 50% in Ontario and BC – where real estate costs the most – said yes. Of those making between eighty grand and $100,000, 41.2% are worried. And across the country, among people taking home more than $100,000, almost 23% admitted they may fall short.

So how could folks earning twice the national average fret and gnash over paying the next cable bill?  Easy answer to that one. I flash on the 50-something BC couple I met on the weekend. He’s an engineer. She’s a lawyer. Family income is $274,000 and they have only $64,000 between them in RSPs and a suicidal trading account. But they own a house, a cottage, a rental condo and a vacant lot – all mortgaged. All either declining in value, or about to do so.

The cult of real estate claims more victims daily. Precious family income’s shoveled into a dying asset class rather than a diversified portfolio. Almost everybody underestimates the cost of ownership and inflates the rewards. Brushed aside are closing costs and selling charges, as well as property taxes, maintenance charges, condo fees and endless home improvements driven by fad and fashion. Truth is, most people who bought in Calgary or Edmonton four years ago have lost money. The same will be true in Vancouver two years hence. And recent ‘winners’ in Toronto bidding wars will curse ever having gone to battle.

RBC estimates 52% of pre-tax average family income is needed to own a house in Canada – even with the lowest mortgage rates ever. That leaves 48% of the after-tax portion of $83,100, or just $30,340 yearly – $2,500 a month – to afford food, clothes, a car, gas, insurance, utilities, vacations, kids, pets and sufficient alcohol. The survey noted above says four in ten of those families can’t hack it. They worry about running out of money before they run out of month. So you can kiss off any cash for the TFSA or retirement plan.

So what happens when 70% of all families join the cult? Yep. Screwed.

Understand this. Do the opposite.

Tomorrow, death by condo.

216 comments ↓

#1 TurnerNation on 04.30.12 at 9:18 pm

2nd?

#2 T.O. Bubble Boy on 04.30.12 at 9:22 pm

Smoking Man – does $2500/month cover you for “sufficient alcohol”? (including tips to the nice waitress)

#3 MJG on 04.30.12 at 9:23 pm

Hey Garth, what happened to yesterdays photo of the cute bulldog? Why the paper shark substitute?

Community standards. Apparently I have none. — Garth

#4 Toronto_CA on 04.30.12 at 9:27 pm

“Tomorrow,death by condo.”

Awesome! Looking forward to that most of all. The Red Pin site new listings being up 65% or something month over month is sort of frightening, no!?

Great post as always, Bearded One.

#5 domain on 04.30.12 at 9:29 pm

I finally get to make my popcorn. I’ve been waiting for 5 years to do so, getting richer every day being a renter.

#6 OwlEyes on 04.30.12 at 9:30 pm

In spite of all this, negative GDP in February (a blip? who knows? Can a blip be down or does it always have to be up by the way?) so maybe low interest rates for another year. That sounds like deflation. I don’t think that makes RE a safe place either. So are we at the point where if rates go up, mortgage holders will choke, while if they go don’t go up, it means the economy is down, meaning less jobs to pay mortgages?

#7 East Van on 04.30.12 at 9:31 pm

The Canadian econmomy stalled in February, so interest rate increases won’t happen this year.

You’re wrong. But it hardly matters – housing’s marked even with rates unchanged. — Garth

#8 Arb Watson on 04.30.12 at 9:36 pm

People will still buy real estate. People buy what they want the most, not what they need.

#9 Smoking Man on 04.30.12 at 9:43 pm

How to Think

Every time someone says something to you, they are selling something. Everyone I have ever met has needs that need filled, some are resourceful, some suck at it.

Every human, every group, every alliance has an agenda with fine print they never will willingly show. It’s human nature.

The bottom line is they need to own your belief systems or it’s no sale.

Yesterday penpal who is skipping this post. made a futile attempt to bitch slap me.

I QUOTE him
“Smoking Man My bet is that you are genuinely friendless in this world and a source of embarrassment for your family. Drug addled, drunk and whoring away your life doesn’t make you special and successful, just pathetic.”

Yet he does not know what my agenda is, no idea what my end game is, does not know my weaknesses to exploit, he is just reacting to a belief system someone programmed into him.. That’s dumb, what’s even dumber is to show your cards. He’s obviously not in sales that’s for sure, my guess education.
I could do a full profile on him in 2 seconds but he is not reading this so on to today’s lesson.

Everybody Lies. This is how you should think.

Say you go for a marshmallow roast with some white Supremist, Neo Nazi types. They say Holocaust is never happened, the Jews suck bla bla bla. Two things you got to do.

One don’t show you hand, agree always, Then try and figure out how will they benefit if I drink the cool aid. What are they selling,stealing or hiding. What is the underlying need they want filled. Find weakness and exploit it.

The following week you go to a Likud party pig roast,(he he) and listen to all the hard-line Zionist talk about the white skin head dogs, and the Holocaust. Then try and figure out how will they benefit if I drink the cool aid. What are they selling stealing or hiding. What is the underlying need they want filled.

Never believe anything from either side, It will make you weak just concentrate on what you discover and can exploit from each camp. Then get em to swallow your cool aid and have your needs filled. It’s called ownership.

That’s how it’s done. So simple.

Mr Carney is fibbing when we says rates are going up this year, the whole world is dropping them, but he is going to raise them. Mr Carney and F are desperately trying to get RED DOTS on the mls by talking market down, Unfortunately The Herd Aint Swallowing

#10 NFN_NLN on 04.30.12 at 9:44 pm

If you’re bidding on a piece of property, how do you know what you’re getting into if you have to pay back taxes, etc? Do they list that for you at the auction?

“Redemption of a parcel of land offered for sale may be effected by certified
payment of all arrears of taxes, penalties and costs at any time prior to the date of the
Public Auction.”

#11 Anon on 04.30.12 at 9:45 pm

#8 Arb Watson on 04.30.12 at 9:36 pm
People will still buy real estate. People buy what they want the most, not what they need.

That is until they’re broke, which is right about now.

#12 MC on 04.30.12 at 9:49 pm

Suicidal trading account…too funny.

#13 Junius on 04.30.12 at 9:52 pm

Garth,

Great post today. I have relatives in Alberta and all I hear about is the boom times that are coming again. It is such a joke in a global context. They may do better but it will not be a boom.

Boom times. Meet the new world of shrinking aggregate demand.

#14 Mark W on 04.30.12 at 9:54 pm

In Vancouver it should also be added …. DEATH BY LEAKY CONDO … !!!

#15 Peter Pan on 04.30.12 at 9:58 pm

#7, East Van…

Funny how Vancouverites pray for Canada’s economy not to grow, so that interest rates won’t increase…
Interesting priorities…

#16 Smoking Man on 04.30.12 at 10:01 pm

#214 TurnerNation on 04.30.12 at 9:26 pm
Me, track6ers still riding tradable ERF.TO bottom up – to 19, in my opinion. I’ve marked it with my yellow highlighter!
…………………………………………….
Just 19 lol

I’m going till I see Batman

#17 its starting .. on 04.30.12 at 10:02 pm

# 8 Arb Watson

people will still buy,
however, they won’t go into bidding wars and if they feel that the price will be lower come the following year they will give a discounted offer.
As soon as the hear that the prices are falling buyers won’t be in a rush to purchase especially if it continues to fall m/m

#18 Smoking Man on 04.30.12 at 10:03 pm

#2 T.O. Bubble Boy on 04.30.12 at 9:22 pm
Smoking Man – does $2500/month cover you for “sufficient alcohol”? (including tips to the nice waitress)
………………………………………………………………….
No Idea I let my resources take care of that stuff.

#19 Narrowgate on 04.30.12 at 10:04 pm

The pen is mightier than the sword…go Garth!

#20 torontorocks on 04.30.12 at 10:07 pm

#37 from yesterday, smoking man getting his a$$ tossed out of the Zanz for swinging at the bouncer…easily his second best post ever. the first one was when he was so trashed he couldn’t even finish his emails….hahah good stuff.

next time he’s at the duke, I’m there.

#21 zeeman on 04.30.12 at 10:08 pm

hi garth

rates going no where, cdn economy contracting as shown by the gdp number and american economy stalling.

people look at monthly payments and with rates low and possibly going lower, the housing market will continue chug along.

new release coming soon in upper unionville and prices are hitting 900k on a 42 foot lot…and these will sell out

#22 Soylent Green is People on 04.30.12 at 10:10 pm

Why did msm go crazy today re harpercon bailingout all the banks sonmanyyearsago.

Why today?

Canadians were never told the true cost of a $114-billion “secret bailout” for the country’s biggest banks during the financial crisis, says a report from the Canadian Centre for Policy Alternatives.

http://www.canada.com/business/Canadians+told+about+secret+bailout+banks+study/6543481/story.html

.
.

.

#23 John G. Young on 04.30.12 at 10:14 pm

#194 penpal on 04.30.12 at 5:30 pm

I think Smoking Man is an interesting character on this blog. I also note that, unlike you, he does not launch personal attacks, and it is for that reason that I decided to come to his defense.

The rest of your post is unworthy of response.

In the future, please direct your invective towards one of your “ten million plus net worth” friends/family. Others here could care less about your money, your opinions or, frankly, you.

#24 Realtors and mortgage broker's know the crash is here! on 04.30.12 at 10:15 pm

Like garth said low interest rates mean nothing. CHMC was the only reason for the housing bubble. Rates can goto zero but banks won’t be lending their money at low rates and not big mortgages like they are now. That means housing crashes HARD! The condo ponzi is in an even worse shape. In a few years you can buy a condo in Toronto for 50% off maybe more. The party is over and the hangover begins. Don’t forget realtors the housing bubble in 2009 was crashing and would of crashed hard as well as three Canadian banks. This time there will be nothing to stop the fall. Game over realtors…..and you know it. :)

#25 Toronto_CA on 04.30.12 at 10:17 pm

http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/home-buying/ready-to-be-bold-sell-the-house-and-rent/article2418383/

Wow. Good article on a couple that locked in their gains on a Vancouver SFH and are renting until after the crash. Takes guts to put money into your beliefs like that. Good on the Globe for running this article. The tide is Turner-ing!

#26 LuckyRenter on 04.30.12 at 10:18 pm

Watsa, Who Models Buffett, Sees Housing Bubble: Corporate Canada
“When you see all these towers going up in Toronto, it feels like it’s going too far,” said Watsa. Our approach “is always to be away from where speculation takes place.”

“I just know that whenever you have a bubble, most people need to think that it’s going up,” Watsa, 61, told reporters after Fairfax’s annual meeting in Toronto yesterday. “The real estate housing market in the U.S. — 2003, 2004, 2005 — everybody thought it was going up.”

http://www.bloomberg.com/news/2012-04-27/watsa-who-models-buffett-sees-housing-bubble-corporate-canada.html

Popcorn,anybody?!

#27 Not 1st on 04.30.12 at 10:20 pm

How about a new 2 part poll question;

1. Are you concerned about paying your bills, paying down your mortgage, and or contributing enough to your RRSPs to fund your retirement?

2. if you answered yes, will you sell your home, bank and invest the equity gain and sit on the sidelines renting until home prices moderate??

My guesstimate is that the first question will yield about 75% yes response, the second will yield about a 10-15% positive response.

#28 Chaddywack on 04.30.12 at 10:22 pm

Not to mention income tax payments are due tonight…..don’t need a former revenue minister to tell us that though in Vancouver. We just will tap into our HELOCs because prices will just keep rising and equity building ;)

#29 Market Bull on 04.30.12 at 10:28 pm

Let’s be clear on the ‘data’ regarding Edmonton foreclosures and CMHC stress-testing, lest someone be left with the wrong impression – willfully or not.

The number refers to the percentage of active listings, not the percentage of homeowners. There are 208,000 owner occupied dwellings in Edmonton. 220 foreclosures represents a 0.001 foreclosure rate.

See, numbers and facts can be fun – especially when manipulated poorly by those that don’t understand them, or perhaps by those that do, but choose to mislead.

As I wrote: “As a blog dog mortgage broker pointed out, there are 220 foreclosures on the market in Edmonton alone, or about 5% of active listings.” I regret your comprehension issues. — Garth

#30 Keeping the Faith on 04.30.12 at 10:28 pm

Stevenson … I am your father

#31 Kaganovich on 04.30.12 at 10:57 pm

#29 market bull

Epic backfire. What a humiliating exchange for you!

#32 Smoking Man on 04.30.12 at 10:59 pm

Here is a zamboza shooter for you die hard bubble heads.

Brother in law you runs a successful window and door company ( I set him) has never had so many bounced checks this year, he works in GTA

Gartho is onto something. O fat lady where are you

#33 South of 49 on 04.30.12 at 11:05 pm

#23
I agree with you. I have been reading Garth’s commandments for several years and I always notice the Smoking Man’s musings.

The answer Penpal is simple: just skip the SM and let the rest of us make our own decisions on who/what to read.

#34 joe on 04.30.12 at 11:06 pm

Sales of SFH in Calgary are up almost 30% YTD. Still a while here before zoombies roam the streets.

Strange. The Calgary Board says 10.3 per cent. — Garth

#35 will not bill on 04.30.12 at 11:12 pm

Thanks Garth for a great piece of writing. I salute your ability to convey your warnings with a dash of needed humour. May you always live with the Amazions.

#36 Tim on 04.30.12 at 11:13 pm

When does it ever make sense to buy a condo? Most- at least on the west coast are poorly built and eventually leak. All high rises will have condensation on their massive window walls in about 15 years of use. You don’t own the land. The building depreciates. The fees always go up. You have no control over this and they start them look to hook you in. You have less privacy and can ofter hear people above you, below you and beside you, most are on busy, noisy streets, most being built now in BC are tiny..

#37 D-dawg on 04.30.12 at 11:35 pm

#29 Market Bull

Ouch…look’in more like the court jester on that one.

Reading comprehension is at least as fun as numbers and facts, give it a try.

#38 Timbo on 04.30.12 at 11:35 pm

http://www.testosteronepit.com/home/2012/4/30/calamity-economy-rearing-its-ugly-head-again.html

“They have been great, and the industry is drunk with exuberance, dreaming about 16 million units per year, the pre-crisis sound barrier that the industry broke through—before it crashed. But if consumers accelerated their auto purchases due to the warm winter, reality will come down on the auto industry like hail the size of tennis balls. And calamity economy will raise it ugly head again.”

but I thought it was getting better?….

http://topdocumentaryfilms.com/real-estate-4-ransom/

good little documentary to pass the time watching bubbles.

#39 nonplused on 04.30.12 at 11:37 pm

Hey Garth, I’m still reading every post but I’ve been too busy to respond. I thought I’d drop a note to say you are hitting it out of the park lately, even as the market becomes too sad to watch.

I agree with you, the hour is drawing near. We can move the hand on the clock from “certain” through “soon” and on to “immanent”. We are moments from when the doctor says “this might feel a bit uncomfortable”.

Sufficient Alcohol in my case is a couple hundred a month, but I drink alone (to quote George Thoroughgood) and at home.

#40 Renting In The GTA on 04.30.12 at 11:42 pm

If you want to blow some money buy here:

http://paradisehomescorp.com/pages/projects/unionville/prices.html

#41 neta on 04.30.12 at 11:42 pm

Low mortgage rates supposed to allow the majority of otherwise to be busted home owners to stay above the water. That’s why we don’t see an overtaking pressure on them to sell, that results in incredibly low supply of resale houses. Tight zoning regulation is designed to keep new SFH supply at bay.
At the same time there is a steady inflow of people who are desperate to buy, and I wouldn’t call all of them fools. There are many people who rightfully consider themselves belonging to Middle Class, with gross income of $80K – $120K, for whom owning a house / condo is absolutely essential to feel adequate. It is just ingrained in our physic. There were many people who refrained from buying, or sold in the last 4 years, hoping for the market to correct and to buy later at affordable prices. Amazingly, correction never materialized. Moreover, due to the above described conditions and another Canadian phenomena – huge inflow of HAM, prices are going higher and higher. It resulted in sudden despair and panic among those sitting on sidelines, which started capitulating en masses. This capitulation has been manifesting itself in explosion of bidding wars. Panicking people are jumping into the boiling waters, like lemmings, committing financial suicide.
My hope is that this overwhelming signs of capitulation are the strongest indication of the approaching break-down. After population of lemmings crashes, there will be sudden apathy and collapse of buying activity.
Although, there is still the last line of defense protecting this ponzi structure – the inflow of foreign money. Flaherty counts that the scale of this foreign activity will be sufficient to offset the number of who’s who will be going down, unable to withstand even such a low interest rates. That’s why Flaherty rejected any suggestion of limiting foreign buying in Canada.
Well, I don’t know for how long F &Co will be able to fight gravity. So far they were pretty skilled, or damn lucky.
From my side, I don’t want to bet on timing, because I happen to be wrong in my predictions for so many occasions. Yes, I bet on wrong horse and I feel miserable. But I refuse to jump into the boiling water.
Hang on guys,hold tight!

#42 ozy - my feeling on 04.30.12 at 11:49 pm

This is 3rd time in 1 year+, that the talking heads in government, media, etc, try to bring the RE market down by talking one and doing other. As the Smokin’ Man said, the herd is not swallowing, but betting on the house. The master thought the tax-farm-slaves (copyright SM) are stupid, but looks that their instincts were good. In their stampede foe shelter, they victimized a lot of other people, but they survived. My feeling is that the taking head won’t be able to bring the RE Market down in Kanata, as was done concertly in other places. Maybe when post-colonial renting quality will raise and mainance fees are kept under 200/month by proper procurement rules enforcement. But that is not happening, and the herd is dismayed at prison-like king of finishings and common laundry rooms in old apartment buildings all over GTA. I do not see the consumerist type selling the MCMansion to cramp with low-income (most) in an appartment building in Scharborough or North york, or Etobicoke for example. Prices will rise for 1 more year, until govt. ACTIONS not talks. Then govt, in 6 months will change course, drop rates and allow people to borrow 50K each from RRSP, to prop the market. How tipically kanatian (copyright Ozy)

#43 Canadian Watchdog on 04.30.12 at 11:52 pm

“Strange. The Calgary Board says 10.3 per cent. — Garth”

CREB must have learned some sales manipulation tricks from TREB. http://i46.tinypic.com/2rmbbsz.png

The average price is only as strong as the sales to back it up.

#44 ozy - my feeling on 04.30.12 at 11:57 pm

This is 3rd time in 1-1.5years, that talking heads in media then government, etc, try to bring RE market down by talking one and doing other.
As the Smokin’ Man noted, obviously, the herd is not swallowing, but betting on the house.
The Masters thought the tax-farm-slaves (copyright SM) are stupid, but looks that their instincts were good. In their stampede for shelter, they victimized a lot of other people (who stayed on the lines) but they survived.
My feeling again is that the talking puppets won’t be able to bring the RE Market down in Kanata in 2012, as was done concertly in other places in the world.
Maybe when post-collonial renting conditions quality will raise and maintenance fees are kept under $200/month by proper procurement and contract awarding rules’ enforcement.
But that is not likely to happen in sub-culture like Kanata from a spiritual perspective, so obvioulsy the consumerist herd is dismayed at prison-like finishings and common laundry rooms in old apartment buildings all over GTA.
So, I do not see the consumerist type selling the block houses in New Market to them cram with low-income (most) in appartment buildings in Scharborough and North york, or Etobicoke for arguments’ sake.
So, prices will rise for 1 more year, until govt. ACTIONS not talks.
Then the new govt, in 6 months will change course, drop rates and allow people to borrow 50K each from RRSP, to prop the market, fule hyper-inflation. Tipical kanatian (copyright Ozy) scam, so see where you fit in the game, and take advantage (though all will loose, the masters converted to gold 2 y ago)

#45 Keith in Calgary on 04.30.12 at 11:57 pm

The wife and I rent in a toney and kuxurious concrete construction inner city condo complex where the two bedroom suites have just dropped from $330K down to $279K almost overnight…..while one bedroom units are down from $240K to as low as $220K now.

Owners in the building have been handed a staged special assessment ranging from $12K on the one bedroom suites, to as high as $20K on the two bedrooms units. Only 78% of all owners were willing or capable of paying these, even with an extension past the initial deadline having passed.

Just a glimpse of reality on the frontlines…………

#46 penpal on 05.01.12 at 12:00 am

@ # 23 John G Young

So, now you speak for other posters on the blog. How positively socialist of you.

“Others here could care less about you..”

That’s odd, you are the only one I see here complaining about my posts with any regularity.

Let me direct you to post # 213 on the last thread.
Perhaps then you will understand my stance regarding Smoking Man. Please read it carefully so that you can understand its content and purpose.

I guess you and he have a lot in common, what with insecurity, self-destructive habits and the like and so you feel that you should come to the defense of a kindred spirit.

Aside from your witless sniping, do you have anything to add to the RE discussion or are you just gonna continue to embarrass yourself by publicizing your own vices and shortcomings in order to garner some sympathy for your position?

Have a little self control and try to stick to the topic at hand.

So John, anything to say about today’s article?
Oh yeah, I forgot.. that’s not why you are really here, is it?

#47 gpc on 05.01.12 at 12:02 am

Hey Market Bull, how are Sheldon and Sara doing? Shouldn’t you be on the Edmonton Real Estate blog defending their market pumping tactics and simpleton local market views?

#48 penpal on 05.01.12 at 12:06 am

@ # 33 South of 49

Where did you ever get the idea that I have any interest in telling others what to read?

Perhaps read post # 213 , last thread – it will clarify my thoughts on SM.

#49 Carpe Diem on 05.01.12 at 12:07 am

You can’t cure stupid.

#50 Doom on 05.01.12 at 12:08 am

I knew it!

First it was hot asian money…now zombies are buying up the real estate.

Game over man…

#51 ex bc boy on 05.01.12 at 12:32 am

CBC National is going to have a round table discussion regarding whether Canada is in a RE bubble or not.

Today they talked about the micro condos in TO. You have a fold out bed/couch and you store your bedding inside the washer and dryer. This just so they can live in downtown TO. HOw about living in a tree.

#52 Hicksville Alberta on 05.01.12 at 12:36 am

You talk of Boom Times in Alberta.

These are only skin deep.

There never will be Boom Times in Alberta or anywhere else in Canada when the VIG being paid as tribute to all Governments throughout the country is at least 50% of income whether it be through direct or indirect taxes or fees.

That doesn’t even count for the massive misallocation of capital and human resources to keep a fundamentally failed Ponzi scheme of bloated real estate and finance and insurance which apparently the Powers That Be takes and bleats as sound economic growth, when in fact it is one more chain laid on the people that they purport to serve.

Eff it and Eff them, all of them.

#53 Nostradamus Le Mad Vlad on 05.01.12 at 12:38 am

-
“BC shrinking economically and mentally ill (full of zombies), this is as good as it gets these days. They worry about running out of money before they run out of month. So you can kiss off any cash for the TFSA or retirement plan.” — What a way to live life, worrying if one will still be employed or whether bills can be paid.

Death by condo or home can also be known as Death By Greed, or choking on their own worthless investments.
*
#23 John G. Young — “I think Smoking Man is an interesting character on this blog.” — Agreed. A lot more out of left field than most, but his posts are accurate.
*
Credit Unions still have advantages over big banks; Identity Theft Dead people don’t tell tales, but thieves can; Cdn. Fiscal Repression; Temples of Doom (banks and homes); Health Insurance Finding something half-decent; Controlled Implosions; US$104 mln. / day profit and gas prices are still high; Some of Spain’s banks downgraded; Write down and fear of dOg; 16:16 clip The bigger silver picture; Illinois borrowing costs to rise; Harvard Economics Prof. Smoking Man is right on; Soaring Home fuel bills; Families with disabled children are struggling, but let the money junkies get richer; Fat Cats Bloggers here have posted about govt. waste, yet officials keep adding to it.

Ron Paul vs. Paul Krugman; 10:59 clip Money can buy happiness; Ready to Surge Interest rates, that is; Apple Take the profits and run! The Landlord Economy in good shape; Tech. Innovation is good; Inflation Gone Wild; The End of the US$ and why the m$m won’t touch it; China and the five driving factors behind their growth; Yale’s Shiller World in depression; US Debt Bubble(s) (worse) than ’07; Natural Gas prices surge; Oz House Prices down 19% from peak.
*
Tennessee Sheriffs crack down on feds.; Links in The USS Enterprise, soon to be decommissioned (or sunk via FF), has arrived near Iran. The USAF also has a bunch of F-22 Raptors just outside Iran’s border. May might be quite interesting; Obloodyhell Moving toward a one world govt. by transferring stuff to the UN, and Communism – Socialism which is what Soros likes; Blue Murder Is that a good title? It Had To Happen Octomom is Broketomom; m$m BS Headlies; May 6, 2012 Extreme Super Moon; Alternative treatments for cataracts and other eye stuff. Links in; How Geniuses Think Way different from sheeple; 0:32 clip Discoverty Channel crashes a Boeing 727 on purpose, which proves that all aircraft can be flown by remote control (9-11?); Hiking Pix of The Great Wall of China.

#54 Inglorious Investor on 05.01.12 at 12:41 am

Some statisctially-minded scribblers might find this interesting:

How long can it take for house prices to recover in real terms after a crash?

Well, in Holland (specifically, Herengracht) house prices reached a new record high in just the last decade.

When was the previous record high reached? 1736. (That’s a helluva long time to be in negative equity.) On the other hand, real house prices in Herengracht did double between 1628 and 2008, so there is hope.

It’s called the Herengracht House Index. See the timeline at http://hotelivory.wordpress.com/2010/08/29/a-very-long-view-on-house-prices/

If you think that’s bad, according to Nicole Foss of The Automatic Earth, houses in Rome took 1500 years to recover their previous peaks. Something or other about the fall of an empire, social decay, political mayhem, yada yada…

Then again, Torontonians may have to wait even longer for the Leafs to win another Cup.

#55 Snowboid on 05.01.12 at 12:43 am

#36 Tim on 04.30.12 at 11:13 pm …

We are wondering the same thing.

As long as the market dictates low (or lower) rents in the Okanagan, we will continue to rent.

#56 LS in Arbutus on 05.01.12 at 12:44 am

Out for lunch today with two people, who in my opinion, should be in decent financial shape. Each are mid to late 50s. Talking about special assessments on condos and one said their mom got hit for $14,000 for a new roof.

They both commented how hard it would be to scrape that money together.

One owns in Richmond, the other in Yaletown. The in Yaletown has a strata council that polices EVERYTHING in the building and someone installed 73 cameras. People are getting fined for the slightest infractions.

I suppose you’re “living the dream” when living in fear of a “special assessment.”

Oh and both admitted they certainly don’t have enough money to retire anytime soon…. both will have bank pensions.

Living the dream….

#57 Michelle on 05.01.12 at 12:48 am

Wow! After hearing of that professional couple that makes $274,000 per year but has saved so little…
…I guess I’m not as screwed as I think!
(on a relative basis)

However, it really makes me wonder what the finances of most upper middle-class families are really like, behind the scenes. It’s scary to think what lays down the road for a lot of people, and how it’s going to affect our communities!

#58 stage1dave on 05.01.12 at 1:10 am

Great post…though I must confess today it was almost “death by Buick”…hahaha. Maybe it’s an Edmonton thing…

(I’m already tired of various parts of my anatomy losing full contact battles on equally varied parts of this bloody 59 LeSabre…already looking fwd to that jeep resto)

Anyhow, I was wondering about the actual ratio of foreclosures to MLS listings in the Edmonton area…after all the second & third-hand stories I hear; it was good to see some solid figures.

My high school attendance, however irregular, did teach me that 5% is somewhat above the “CMHC doomsday scenario” of a 3% default ratio, which should be setting off a few alarm bells in somebodies office…if it hasn’t already…

The local MSM has been strangely silent on this issue (other than the usual puff pieces) which is almost treasonous in a “have” province that just went thru an election.

(which turned into yet another advertisement for the simple fact that PR can’t get enacted fast enuff. Though I did find it somewhat refreshing that two white females were defending the status quo instead of two white males. A couple of the latter were too busy missing several perfect opportunities to keep their mouths shut, which was the most entertaining portion of the entire affair)

Anyway, supposedly lots of good-paying jobs, labour shortages, opportunity a’bounding & (potentially) one household in twenty can’t pay their property taxes?

This isn’t ending well at all…

#59 Aussie Roy on 05.01.12 at 1:13 am

Aussie Headlines

Australian home values fell last month, adding to pressure on the Reserve Bank to slash interest rates to rekindle demand in the sector. Melbourne’s values led falls, and are now down 7 per cent from a year earlier.

http://www.theage.com.au/business/home-price-fall-adds-to-rba-focus-20120501-1xvya.html#ixzz1tajSjsB8

Australian new-home sales dropped in March to a record low, the Housing Industry Association said in a report that urged the central bank to cut interest rates by half a percentage point when it meets tomorrow.

Total sales declined 9.4 percent to 5,443 from a month earlier, the Canberra-based industry group said in a statement today. Detached house sales slumped by 9.7 percent and apartments sales fell 6.9 percent, it said.

http://www.bloomberg.com/news/2012-04-30/australia-new-home-sales-fall-to-record-low-amid-rba-rate-pause.html

Home sales sink to lowest since 1994

http://www.theage.com.au/business/home-sales-sink-to-lowest-since-1994-20120430-1xtur.html

New home sales fell to their lowest level in over a decade in March 2012, said the Housing Industry Association, the voice of Australia’s residential building industry.

http://www.macrobusiness.com.au/2012/04/new-home-sales-crater/

RP Data-Rismark this morning released its daily home price indices for 30 April, which revealed that Australian capital city home values recorded a -0.73% fall over the month – the largest decline since January 2012 (-0.97%) and breaking two consecutive months of rises (+0.68% in February and +0.18% in March).

The below table summarises the end-April home value indices as well as the rolling quarterly and annual changes.

http://www.macrobusiness.com.au/2012/04/australian-housings-poor-april/

THE state government’s tax revenue predictions have been slashed by more than $2 billion a year compared with when it was elected, prompting Premier Ted Baillieu to warn ”there is no magic pudding”.

Foreshadowing further deep spending cuts in tomorrow’s state budget,

http://www.theage.com.au/opinion/political-news/baillieu-warning-no-budget-magic-20120429-1xt0e.html#ixzz1takQOnbA

RBA (Aussie central bank) just announced a .5% interest rate cut, it will be interesting to see how much of this cut is passed on by the big banks.

PS. No lower rates won’t stem falling house prices.

#60 John on 05.01.12 at 1:16 am

“Domain”, making popcorn after 5 years of renting.

Let’s say 70% of Canadians are in the cult. Let’s say there’s a royal “Bank of England” style screwing ( which there is). What’s your opinion of how things will go?

Do you believe in CMHC’s scenario of a 3% stress test as a “doomsday” scenario? What are people thinking.

Last year a close family member who is independently wealthy ( and owns zero real estate), and who doesn’t play the stockmarket…mentioned he made a lot of money in 3 days shorting MANULIFE. I don’t remember the number, but it was over 500,000. Maybe close to a million? It was a lot. In…and out.

So if you think that kind of crap won’t touch you, and 70% of people around you being screwed won’t touch you….and that the system itself isn’t seriously screwed….then you’re living in a hyper reality.

If my family squeezes a half million out of Manulife in 48 hours, imagine the wealth transfer scheme Mark Carney’s mafia bosses are involved in.

Like it was spouted in a supposed “tsk tsk” fashion in the Globe and Mail today, long after the ranch has been burned down, “There were whispers of Mark Carney…blah blah…appointment..Bank of England”.

How nauseating.

The Globe and Mail is a supposed reflection of that solid 1887 Canadian banking edifice. Trustworthy. Informative. Serious. Now they are reporting a psuedo-scandalous “journalistic risk”, questioning the “Govenor”. After observing years of straight up fraud.

WHAT. A. FK’ING. SCAM.

Doncha think? So if they are capable of doing that…what else have they got going on? I mean…who knows?

Microwave up the popcorn and snuggle up to some cable TV. Everyone’s doing that. Not just the “70%”.

That’s how the Globe and Mail does it…because hyper realities include them, and the real estate fraud, and everything else.

A hyper reality doesn’t even notice regular reality.

#61 Don on 05.01.12 at 1:25 am

#23
I agree with you. I have been reading Garth’s commandments for several years and I always notice the Smoking Man’s musings.

The answer Penpal is simple: just skip the SM and let the rest of us make our own decisions on who/what to read.

***

Smoking man is smoking man but the abusive comments are unwarranted, unless I missed something?

PenPal : Why the hostility?

Lot’s of people ranting lately – things are changing.

#62 The Thing in the Basement on 05.01.12 at 1:33 am

Garths reply to “Market Bull” @29

“As I wrote: “As a blog dog mortgage broker pointed out,
there are 220 foreclosures on the market in Edmonton
alone, or about 5% of active listings.” I regret your
comprehension issues. — Garth”

My reply @215 to blogger EMB was before I had read Market Bulls comment. Perhaps I was less cyncial civil,
but I understand Bulls frustration, and was surprised
Garth had quoted EMBs stat, when there is little
relevancy to CMHC solvency. Mortgage brokers have
often been criticized on this blog, and blogger EMBs
comparison of these two ratios shows either a lack of
understanding or even possibly a deception, although I
cannot speculate on a motive for the latter.

Garth – you work hard on this blog everyday. It has been awhile since I thanked you. Thank you.

#63 YVR Optimist on 05.01.12 at 1:38 am

@#29 and Garth – Market Bull is right, though, even if he mis-read your quote.

Garth, your quote is “… about 5% of active listings. Context? “CMHC has been stressed tested to be able to handle a doomsday scenario of over 3% default rate…”

Which, at first glance, makes one assume that CMHC cannot deal with this current 5% default rate because it’s more than 3%.

But I’m fairly sure the CMHC 3% number isn’t 3% of active listings, is it? Do they base their doomsday scenarios on the ratio of foreclosures to active listings?

Two COMPLETELY different numbers are being compared in the same paragraph to give the impression that things are in a doomsday scenario. This is totally irresponsible, let alone inaccurate.

I know, I know you’re not saying that, Canadian Mortgage Trends is saying it, but you’re reporting it.

Did I hurt your eyes? — Garth

#64 wayoutwest on 05.01.12 at 1:42 am

#35 WILL NOT BILL “….May you always live with the Amazions.”

Holy Land here I come!!!

#65 PoorgEoisie on 05.01.12 at 1:44 am

I am under the influence of the smoking man elixir… And I have a problem with the term track6er. I know what whoever it was that came up with the term was talking about people waiting for a train at union that “opens the doors on track 5 before track 6″
Call me a railroad semantic but any train that arrives on two tracks at once is not one that you want to be riding…
Platform and track are two different words with entirely different meanings and it’s kind of amusing to hear people talk about how dumb other people are while sounding a little dumb themselves.
As a hilarious side note, guess what a BA in economics and poli-sci gets you? Did you guess train driver?

#66 Furst on 05.01.12 at 1:46 am

FURST TIME WINNER!!!
Smokingman, works for mehhhhh……

#67 TED23 on 05.01.12 at 1:54 am

The point #29 market bull was making is Mr.Turner could have made the same conclusion, that being 220 foreclosures represents a 0.001 foreclosure rate.
Mr. Turner however is no different than those he criticizes in that he uses fear to make his point. The world is not and will not come to an end. It maybe in transision but that’s a natural flow of the economic cycle. Some will loose and some will win. What’s new.

I see neither fear nor world-ending prose in my post. Methinks this problem is with you. — Garth

#68 Lee on 05.01.12 at 2:07 am

Getting too hard to find the gems in the midst of the bickering and grandstanding. Love the blog, made this.

http://cheezburger.com/6178639104

#69 Furst on 05.01.12 at 2:20 am

FURST!!! Smokingman works for meh…..

#70 Anonymous on 05.01.12 at 2:55 am

The Canadian economy stalled in February, with growth decreasing instead of increasing …. um?

Does any of this sound similar to the double-dip recession that the UK / Spain is currently entering into?

Does this sound as if Canada / USA might also be entering a recession some time soon too?

And we all know what usually happens to housing in a recession.

#71 TRT on 05.01.12 at 2:59 am

Question:

If CMHC, BoC, low int rates, and lax lending policies led to high RE prices in Canada, then why aren’t prices in London ON and Vancouver BC the same?? Why arent prices in Prince George and Toronto the same??

Anyone?? What gives? ;)

#72 Aussie Roy on 05.01.12 at 3:59 am

Aussie Headlines 2

Australian House Prices down 10% from Peak – Steve Keen

Australian House prices have now fallen 6.1% from their peak, and have been falling for 21 months, which is the longest downturn in nominal prices ever recorded by the ABS—the previous longest being the 12 months from the beginning of the GFC (which was terminated by my favourite government policy of all time, the First Home Vendors Boost).

http://www.debtdeflation.com/blogs/2012/05/01/australian-house-prices-down-10-from-peak/

UPDATE: The Reserve Bank of Australia has cut Australia’s official cash rate by a larger-than-expected 50 basis points, to 3.75%.

http://theconversation.edu.au/not-everyone-wins-when-interest-rates-fall-6770

Slow Melt

The solid new trend of falling house prices is confirmed by the ABS today with real prices now in retreat for seven quarters and the downward path accelerating. Property markets operate on a very long cycle. Once broad trends are established, they continue, says Prosper Australia.

Today’s ABS House Price Index 6216.0 is a lagging measure, but fresher statistics like building approvals, housing finance and auction clearance rates have been consistently weak for 12 months or longer and show no change to conditions.

“There is a seller strike and a buyer strike,” Prosper Australia Campaign Manager David Collyer said today.

“We are seeing a house price ‘SLOW MELT’ as sellers hold out for peak prices while buyer indifference means few properties are sold”.

http://www.prosper.org.au/2012/05/01/seller-strike-buyer-strike/

#73 Zhorgon on 05.01.12 at 4:06 am

With all this RE Schadenfreude on this website, I have lost track of the endgame…

What was it again?

Oh yeah, the renter who dies with the biggest portfolio “wins”?

#74 Steve on 05.01.12 at 7:02 am

Garth, as usual, a great blog entry, although it seems you actually expect us to think?

On the 5% (0.001?) issue, despite the need to sort out the statistic, it is not clear without additional information whether this is an unusual foreclosure rate. Do you have statistics to share on what the rate would tend to be elsewhere and/or historically?

#75 maxx on 05.01.12 at 7:10 am

In the mid-nineties, a friend lost a high-paying job. It took 3 years of business start-up and part-time work to make ends meet and once again find the equivalent of the original salary. He swore that if he ever replaced that job, he’d shovel money away like there was no tomorrow. He made good on that promise to himself and today is financially independent.

Now, we live in an age where good jobs are very difficult to get and keep and money is even harder to save. Many people have forgotten or never learned how to budget, save and spend efficiently, let alone get a sense of the big picture and what could happen when economic conditions change. Too much property, designer junk, vacations, spas and lattes…..wealth destroyers that we’ve been convinced we “deserve”. Pity….

#76 I. Muvrini on 05.01.12 at 7:11 am

Garth, what do you make of this?

Banks got $114B from governments during recession
Support for banks ‘more substantial than Canadians were led to believe’: CCPA report

http://www.cbc.ca/news/business/story/2012/04/30/bank-bailout-ccpa.html

#77 Andrew Norman on 05.01.12 at 7:41 am

Falling real estate in prices in Canada is an obvious one.

World real estate prices have been in decline since 2006.

Falling real estate prices is yet another symptom of DEFLATION. No need to speculate, it’s here.

Markets are headed this was too.

http://bullandbearmash.com/index/sp-500/weekly/

#78 House on 05.01.12 at 7:53 am

Your solution is that people smarten up and change their lifestyle. But what chance is there for the average person when a lawyer and an engineer can’t figure this out. Perhaps if government and central bankers were a little less inclined to use interest rates and monetary policy to goose the economy and moderate the exchange rate, and let the economy do what it does, people might be able to get off the merry go round.

#79 Steevo on 05.01.12 at 8:07 am

http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/home-buying/ready-to-be-bold-sell-the-house-and-rent/article2418383/

#80 TurnerNation on 05.01.12 at 8:17 am

Australia: RBA slashes interest rates by 50 basis points to 3.75 per cent

:-o

The stupidity of governments never ceases to amaze. — Garth

#81 Mr Buyer on 05.01.12 at 8:20 am

#70 TRT on 05.01.12 at 2:59 am
Question:

If CMHC, BoC, low int rates, and lax lending policies led to high RE prices in Canada, then why aren’t prices in London ON and Vancouver BC the same?? Why arent prices in Prince George and Toronto the same??

Anyone?? What gives? ;)
……………………………………………………………………….
How are standard prices across the country and bubble inducing lending practices logically linked in an if/then statement. That is kind of like if fire destroyed the house why isn’t every bit of all the flammable material burnt to cinders uniformly? Since all the flammable material is not burnt uniformly it must have been some other force that reduced the house to ashes, maybe termites or FIRE ants possibly.

#82 Realtors and mortgage broker's know the crash is here! on 05.01.12 at 8:26 am

Are some of you realtors on here posting day and night that stupid? Do you people understand the housing market was crashing in 2009 since CHMC was hitting it limit and people were going bankrupt during the 2009 crash? The housing bubble was crashing so hard the government had to step in and stop the housing bubble and three banks from going under. CHMC will not have the limit increased which means not only will weak borrowers not get mortgages but many will not be able to use their homes as atm(HELOC ) . The will be a huge negative effect on the economy. We all on this blog understand your lack of education as realtors are not experts or professionals in economics. The fact is you know nothing of the housing market as six weeks training is a joke. The housing correction and crash is coming and nothing you say or do will stop it.

#83 jess on 05.01.12 at 8:31 am

ex bc boy

“aPodments” ,”New York-style living,” “diversity living”
Are there tax credits for building these pods?

#84 W. Buffett (Willy) on 05.01.12 at 8:34 am

#57 Michelle

“Wow! After hearing of that professional couple that makes $274,000 per year but has saved so little…
…I guess I’m not as screwed as I think!
(on a relative basis)”

A book came in out in the mid 90s entitled The Millionaire Next Door and it describes the phenomena that the bearded mystic oracle Garth cites in his example of the $274k couple with virtually no assets. They are the norm, not the exception. The book showed how high earning couples were massively into conspicuous consumption and saved little whilst some individuals (almost all owned their own business)who lived in modest neighbourhoods, drove beaters and shopped at No Frills were worth millions. These individuals were small scale Warren Buffetts.

#85 John on 05.01.12 at 8:44 am

Not 1st Survey:

How about a new 2 part poll question;

“1. Are you concerned about paying your bills, paying down your mortgage, and or contributing enough to your RRSPs to fund your retirement?

2. if you answered yes, will you sell your home, bank and invest the equity gain and sit on the sidelines renting until home prices moderate??”
—————

Some basic questions about your survey design. Specifically question number two. But before that I think it’s fair to say that anyone soaked by the ponzi and in debt must get out…yesterday. And anyone with fake “equity”, built on the back of international derviatives fraud, wars, slave labour and overall riverboat gambling, might want to sell to move to a house they like…or purchase something absolutely illiquid, that can’t be taken from you by “market” forces. That way you may end up with something. Best case is a slow deflate anyway.

On to the survey analysis.

First. What sideline? Do you actually think that a fraud of this proportion is a game? The game is the riverboat gambling…done from afar. The fraud is creating the impression that suckers play. What sideline are you talking about. Maybe you mean “from the breadline”. Your idea makes no sense.

You plan to “invest” “equity” in products and services of the sinking riverboat? Why? How are you coming to this conclusion?

You think housing “prices” will “moderate”? Where are you getting that analysis from? It’s bordering on delusional.

The survey is a good start if you remove all the unfounded pie-in-the-sky assumptions. Even a couple of hours of basic research challenge all of the beliefs your survey is founded on.

Never before has so much information been available…and good information. Just goes to show that the answers really are in the questions.

#86 W. Buffett (Willy) on 05.01.12 at 8:47 am

#72 Zhorgon

“Oh yeah, the renter who dies with the biggest portfolio “wins”?”

Thanks for my LOL moment of the day!! Very witty!

I thought it was the owner dying with the biggest house, whose spouse gets an illiquid inheritance. What a giggle that is. — Garth

#87 One Flew Over the Cuckoo's Nest on 05.01.12 at 8:49 am

#71 Aussie Roy

Good day mate! Are you trying to tell us Canucks that you Aussies are as mad as we are when it comes to real estate? Thanks for letting us know we are not alone in the asylum.

#88 angela on 05.01.12 at 8:52 am

#68 FURST
Are you intellectually challenged? Or perhaps you are just lonely in Momma’s basement.

#89 In GARTH and god We Trust on 05.01.12 at 8:53 am

#69 Anonymous

“Does this sound as if Canada / USA might also be entering a recession some time soon too?”

If the beaded mystic oracle, all knowing, all wise, reader of financial tea leaves, former minister of national revenues, lone voice crying out in the financial wilderness of Canada states there will not be a double dip recession then there will not be one! End of matter.

#90 Track Six Sammy on 05.01.12 at 8:56 am

#65 PoorgEoisie

“As a hilarious side note, guess what a BA in economics and poli-sci gets you? Did you guess train driver?”

Well who the hey do want driving these trains? High school dropouts??

#91 Smoking Man on 05.01.12 at 9:02 am

Penpal. Going to share something with you my father told me along time a go and it stuck

If you pick up shit and then throw it at someone
You may hit your target or you might miss. But regarless the outcome you will always smell like shit

#92 Rural Rick on 05.01.12 at 9:07 am

Hey Pen Pal I for one would appreciate it if you would stop your personal attacks on others posting here. It violates the rules. ( see HELPFUL REMINDERS FROM YOUR FORUM HOST at the bottom of the page) It is also very revealing of your character in ways you may not be aware of.

#93 condopoor on 05.01.12 at 9:08 am

I have two decent sized portfolios with the Orange guy’s “fund” products. Can anyone speculate how these will hold up when RE starts to making a flushing noise? I’m hoping Garth can save me yet again.

#94 S. Freud on 05.01.12 at 9:22 am

#9 Smoking Man

Today’s message: “How to Think”.

Smoking Man o Smoking Man. It is almost painful to read your posts. You assume everyone on this blog hasn’t a clue about psychology, that everyone is a mindless bubble head waiting for your grand pontifications on life, markets, psychology, etc. Oh well, there is comic relief in it all I suppose. BTW, I spend the first decade of my working life in sales.

#95 Market Bull on 05.01.12 at 9:26 am

I thought it was the owner dying with the biggest house, whose spouse gets an illiquid inheritance. What a giggle that is. — Garth
_____________________________________________

A big paid-off house is hardly illiquid.

Watch for a continued rise in reverse mortgages as more and more senior homeowners tap into their equity. Interest rates recently dropped significantly for reverse mortgages and the minimum age was also lowered to 55.

If you pay off the interest only every month on a reverse mortgage, it’s just like a non-amortizing HELOC; only more expensive and with a far lower maximum LTV of 40%.

Regardless, reverse mortgages are becoming increasingly popular and the only product available perhaps for those who do not qualify for a HELOC (ie., due to the death of a ‘breadwinner’ spouse).

Remember 43% of Canadian homeowners have no mortgage, the vast majority of course being boomers. In other words, the percentage of boomers who own their home outright is much higher than 43%.

Not to mention the fact that it is the boomers that have the bigger homes on average, thus representing an even larger proportion of total home equity.

A correction will ‘hurt’ some but not all.

Anyone taking a reverse mortgage deserves their fate. And spouses like cash. — Garth

#96 In GARTH and god We Trust on 05.01.12 at 9:26 am

“I thought it was the owner dying with the biggest house, whose spouse gets an illiquid inheritance. What a giggle that is. — Garth”

Nobody, but nobody can trump our fearless leader when it comes to witty retorts. Well done Captain Garth!

#97 Steven Rowlandson on 05.01.12 at 9:31 am

So what happens when 70% of all families join the cult? Yep. Screwed.

You might even say financially buggered.
Offering more than 3 times the annual pay of the man of the family is a very bad idea when it comes to buying a home.
Just because there are two wage earners in a family it doesn’t give people the excuse to combine incomes and drive up real estate prices and price the less privileged people out of the country. Lets have some restraint and some social responsibility by the well to do for a change. Besides if the wifes income isn’t going to an oversized mortgage then that leaves some money for savings and the finer things in life…. Think about it.

#98 Q on 05.01.12 at 9:50 am

The current Canadian real estate market reminds me of the Titanic. Captain and officers saying there’s no need for alarm, all will be fine, just ignore the sounds, don’t panic, just a minor bump …. as for an analogy of the biased, half baked realtor shtick ….”the band played on”….

#99 Doug in London (formerly Abitibi Doug) on 05.01.12 at 9:54 am

That couple from BC you profiled baffles me, especially when one of them is an engineer. to get an engineering degree, don’t you have to study statistics among your other rigorous math courses? Wouldn’t even a basic understanding of statistics tell you to avoid buying too much real estate when it is at an all time high? Similarly, in engineering you increase reliability by not putting all your eggs in one basket. For example rather than put the power supply to an essential service (hospital, water treatment plant) one one power feeder, you have 2 separate feeder supplies or better yet have a diesel generator backup. Why wouldn’t an engineer apply these same principles to their investment portfolio?

#100 Q on 05.01.12 at 9:54 am

Things should get interesting when the 1st class passengers (bankers) overload the lifeboats (CMHC) with their cowardly, usurious behinds……hopefully, Harpo and mini F will go down with the ship.

#101 Sometimes pedantic but never humourless on 05.01.12 at 10:01 am

Hey Beach Girl, where are you? I’m missing your cheeky posts; come home – all is forgiven!

#102 Ben on 05.01.12 at 10:06 am

I would love to hear opinions from Garth and his fans on where they think the epicenter of the crash will be. I am not as concerned with the condo market but rather the single family market (towns/semis/sfh). Thoughts?

#103 Kevin on 05.01.12 at 10:21 am

@Tim (#36):

When does it ever make sense to buy a condo?

When you’re older and can’t/don’t want to mow your lawn or shovel a driveway.

Most- at least on the west coast are poorly built and eventually leak.

“Poorly built?” How so? Do they require any more maintenance than a freehold home?

All high rises will have condensation on their massive window walls in about 15 years of use.

False. There are plenty of condos out there with window walls that are older than 15 years and do not (yet?) have condensation.

You don’t own the land.

Nobody does. Try refusing to pay your property taxes and see how much land you “own.”

The building depreciates.

Condo resale prices have been climbing for years.

The fees always go up.

You mean like property taxes, heating/electricity rates, duct cleaning fees, and everything else?

You have less privacy and can ofter hear people above you, below you and beside you

As opposed to suburbia where I have 6″ of drywall/osb and 10 feet of lawn separating me from my neighbors? I’d prefer the foot-thick walls of concrete if the issue is “privacy.”

Most are on busy, noisy streets

Of course they are. Who wants a condo way out in the middle of nowhere? The streets are “busy” and “noisy” because there are actual things to do.

most being built now in BC are tiny..

Condos come in all sorts of sizes.

All of your reasons are easily refuted. Do you believe that the only people who buy condos are idiots? Do you seriously believe that everyone who buys a condo only does so because they’re stupid? Can you not understand that they have perfectly good reasons for their choices? Or do you understand that, but simply believe that people with opinions, values, and preferences different from yours are somehow less informed/intelligent?

#104 This is Wonderland on 05.01.12 at 10:27 am

From yesterdays post.

#110 Do Do Bird
There are some inexpensive pockets of houses in Ontario like Windsor …..
——————————————————————
One word….Unions

I have seen many companies try to set up shop or do some sort of business in Windsor only to be threatened by or strong armed by the CAW and other local Unions. This is the number one reason I left and will be the reason Windsor will never recover from the Automotive down turn and 2008 recession.

#105 Paully on 05.01.12 at 10:32 am

To those commenters who are inclined to hurl the invective and insults around here, it would be a worthwhile activity to ask yourself if you would say the same things in the same way if the object of your ire were standing right in front of you?

Some of you are pretty tough when you are anonymous in cyber-space. Perhaps we could all try to be a little more civil and polite? Please and thank you!

#106 getreal-tor on 05.01.12 at 10:42 am

#73 Zhorgon on 05.01.12 at 4:06 am

The endgame is the survival of the fiscally fittest and to perhaps leave a bit to your offspring or dependents to ease their lives. If you’ve got no children or dependents, then by all means, spend as fast as you make it but even then you always need something for a rainy day.

Borrowing money from the banks is like making a deal with the devil – they will be your best friend and kiss your ass until you try to recant on your agreement or fail to make payments. They don’t care if you over extended yourself or if you’ve lost your 15yr job due to a critical illness – no pay, no play.

#107 Mister Obvious on 05.01.12 at 10:42 am

#78 House

“Your solution is that people smarten up and change their lifestyle. But what chance is there for the average person when a lawyer and an engineer can’t figure this out. “
——————————-
What you are missing here is that law and engineering are vocations not educations. That doesn’t mean some lawyers or engineers do not also have educations but it’s a mistake to assume one follows from the other. I know of skilled ‘professionals’ who are, for want of a better word, rather dense in most other modes of thinking.

Often, those who become successful are ‘knowledge seekers’ who look for answers well beyond the confines of what they do professionally. They realize the world is larger and more complex that the specialized local ‘world’ defined by their particular discipline.

I suspect that would include many readers of this blog. Perhaps not so much among regular commenters (myself included), but certainly among the other 99% (literally) who read Garth’s musings daily and move on to other interesting things without bothering to deposit their gems of wisdom.

#108 Mixed Bag on 05.01.12 at 10:45 am

#9 Smoking Man on 04.30.12 at 9:43 pm

True.

#109 getreal-tor on 05.01.12 at 10:46 am

#68 Lee on 05.01.12 at 2:07 am
Getting too hard to find the gems in the midst of the bickering and grandstanding. Love the blog, made this.

I agree but I think it is also due to the software used for a blog… It isn’t very user friendly or efficient. Garth must be waiting for the economy to crash so that all unemployed consultants will outbid each other to do the upgrade for free. :)

#110 refinow on 05.01.12 at 10:54 am

#22 reason why the $114 Billion bailout hit the papers yesterday has 100% due to the re-allignment of CMHC to OSFI. They have to pull all the dead bodies out of the closet before OSFI takes over. And that particular $114 Billion dead body has been stinking up the closet for a really long time.

Anybody else a little troubled by why our precious CDn Banks actually need a bailout of that amount.

Where did Canada actually get $114 Billion, (Other then from my Kids, Kids future taxes.

Have we not been told that our Banking system is STRONG, that our lending practices are differenet then that of the US or Europe, that it is different here…

Greatest “Snow Job” on the Planet, the CDN government telling Canadians that it is different here, No housing bubble here, we are nothing like the US, no subprime lending…

Well guess what, we have a “Subprime” government that continues to pull the wool over the eyes of each and every Canadian.

But they are correct, it is different here, it will actually be worse, because the Govenment faked the economic recovery.

Seems like Flaherty just accidently drank the kool-aid.

#111 getreal-tor on 05.01.12 at 10:54 am

#57 Michelle on 05.01.12 at 12:48 am

However, it really makes me wonder what the finances of most upper middle-class families are really like, behind the scenes. It’s scary to think what lays down the road for a lot of people, and how it’s going to affect our communities!

Behind the scenes, I don’t think they fare any better than most other Canadians. Just because someone earns 150k+ it does not make them any more fiscally responsible.

I wouldn’t be surprised if some of them are even worse off as their borrowing power was higher but yet their ability to pay back is even more fragile as executive jobs are not as easily found as regular professions

#112 disciple on 05.01.12 at 10:59 am

#91 Smoking Man… Wise words. Unpleasant imagery, but wise words… For those who may have missed it, Princess Die is still alive…

http://xdisciple.blogspot.ca/2012/03/princess-diana-panorama-interview-1995.html

#113 Mr Buyer on 05.01.12 at 11:05 am

#91 Smoking Man on 05.01.12 at 9:02 am
Penpal. Going to share something with you my father told me along time a go and it stuck

If you pick up shit and then throw it at someone
You may hit your target or you might miss. But regarless the outcome you will always smell like shit
……………………………………………………………………..
I had to take a moment to let that little gem sink in. It has inspired me to tell my four year old tomorrow morning “Remember son if some guy hauls off and hoofs you in the nads and you turn around and hoof him in the nads you are still going to have sore nads.” Now he only understands about 80% of what I say because his Japanese is overpowering his English presently but I am expecting an expression on his face that will nicely communicate the bewilderment I feel most every day. It should be a real Kodak moment. Thanks dude.

#114 alkali on 05.01.12 at 11:11 am

Garth – a lot of the examples you show are anecdotal. I know people who are not 40 yet, are mortgage free and have over $100K in their RSPs, I wouldn’t base that the economy is doing great based on their situation either.

Are you noticing a trend with more of your clients being bad (financial) shape?

No. And the survey I shared was anything but anecdotal. — Garth

#115 Beach Girl on 05.01.12 at 11:27 am

#21 zeeman on 04.30.12 at 10:08 pm

hi garth

rates going no where, cdn economy contracting as shown by the gdp number and american economy stalling.

people look at monthly payments and with rates low and possibly going lower, the housing market will continue chug along.

new release coming soon in upper unionville and prices are hitting 900k on a 42 foot lot…and these will sell out

_____

Upper Unionville, what a laugh. Left that burg 15 years ago. Try more like Ho Chi Mein Trail used to be the Bridle Trail. What a horrify existence that was. Probably as bad as living in some 400 sq. ft. condo in T.O. with the windows falling out. Nice investment.

On a much lighter note, not really, alot of my friends are in deep financial peril. Being married can also be lonely.

I live communally, we all pay the bills, laugh, because we are not Rock Stars. Not to much stress here. Just waiting to open the pool.

Live a simpler life, Enjoy what you have left.

When you die, the bank will not remember YOU.

And I don’t think rates are going anywhere.

#116 Furst on 05.01.12 at 11:41 am

#88 angela on 05.01.12 at 8:52 am
#68 FURST
Are you intellectually challenged? Or perhaps you are just lonely in Momma’s basement.
______________________________________________
Angela, do you own or rent? I need some financial advice and there’s no better place to get it than from people commenting on a blog. I need to make a decision so I can move my intellectually challenged azz out of momma’s basement.

#117 disciple on 05.01.12 at 11:45 am

I assume Boston Pizza / Jack Astors are just following the “Breastaurant” trend… check out how grandpa’s playing it cool… he’s still got the knack of pretending not to notice the mammies invading his face space…funny.

http://www2.macleans.ca/2012/04/25/get-ready-for-the-breastaurant/

This is not a breast blog. Sadly. — Garth

#118 Tyredandboard on 05.01.12 at 11:54 am

“RBC estimates 52% of pre-tax average family income is needed to own a house in Canada – even with the lowest mortgage rates ever.”

Gartman letter mentioned that RBC reported it is 52% back east, but 92% in Vancouver.

I was being my usual understated self. — Garth

#119 Liquid Lou on 05.01.12 at 11:55 am

While the bearded oracle Garth cites that houses are illquid, I submit that houses, like stocks can become liquid at the right price. For the 0 down, 40 year amortization crowd or the 5/35ers it is a moot point as they have no equity to play around with. For the retiring boomer who wants to dump the house, liquidity simply becomes the price you are willing to accept.

Not exactly. The market for suburban McMansions may be virtually non-existent in certain areas in coming years. — Garth

#120 KingBubbles on 05.01.12 at 11:56 am

http://money.ca.msn.com/investing/deirdre-mcmurdy/is-ottawa-about-to-burst-the-housing-bubble

#121 Liquid Lou on 05.01.12 at 11:56 am

Forgot to mention in my previous post that assumes the retiring boomer has a paid off house…

#122 young & foolish on 05.01.12 at 12:08 pm

I love this blog ….

thanks Garth!

#123 robert james on 05.01.12 at 12:12 pm

Must be planning for the Vancouver Donald Trump wannabes.. http://www.cbc.ca/news/yourcommunity/2012/05/should-the-lions-gate-bridge-get-suicide-barriers.html

#124 CTO on 05.01.12 at 12:16 pm

#103 Kevin

Your not Kevin O’Leary are ya?

Just askin?

#125 T.O. Bubble Boy on 05.01.12 at 12:24 pm

Milton, Markham? Richmond BC? Are you paying attention?

http://grist.org/list/america-has-40-million-big-houses-that-no-one-wants/

#126 MrHulot on 05.01.12 at 12:24 pm

#118

And what if it were a breast blog. What would you be advising?

DELETED

#127 Smoking Man on 05.01.12 at 12:29 pm

TurnerNation

This Huston.” Shuttle ERF.” Go with Throttle Up.

“Roger Huston” going with Throttle Up.

#128 truth hammer on 05.01.12 at 12:31 pm

Garth, regarding ‘community standards’……there are two shows on Shaw Cable that eclipse the bull dog-girl photo you’d posted by a country mile……Toddlers& Tiara’s and My Big fat gypsy wedding….both of which have an entire photographic obsession with very young children sexualized to the point of a truly sick and twisted perversion on behalf of producers and public who have joined to support such sick pedophilic tendancy……..so what I’m saying is…….complaints about your picture should be redirected to Shaw Cable and the producers of the thinly disguised kiddie porn aforesaid.

Having said all that…..I want to pick up on your comment on ‘$100 OIL’ in Alberta……Canada enjoys no such profit out of the oilpatch. The oil out of Canada is discounted $20 dollars to WTI to $80 per barrel because we are fighting for storage space in the US refinery system and as such we get super screwed on the valuable product we have to ‘shop’ to the lowest bidder instead of getting full value for…….even Mexico gets the WTO price…but not Canada….

Most sheeple aren’t aware of the reasons….so ‘TRUTH HAMMER’ will tell you.

For three decades, after the blue eyed arabs in Arabs told Trudeau and his national energy plan to go and ‘F’ off, the federal LIBERALS refused to OK the development of any transportation infrastructure or refinery capacity in Canada to spite the oil industry.

This $20 dollar discount results in trillions of tax dollars not having been collected from a natural resource for the benefit of all Canadians…possibly resulting in superior services at much lower taxation…….obviously the LIBERAL braintrust would rather tax the citizens wages than say they were wrong about the NEP in the 70′s…..and we are left with that legacy today.

The current regime is trying to reverse this ideological quagmire but with the entrenched mentality of thirty years of evil LIBERAL brainwashing it is hard to turn things around in an enviornment of a lifetime entrenched judiciary of LIBERAL appointed judges and a Charter which has stolen the democratic right to vote their will against the Charter of Liberal Ideology that gave the peoples rights to a LIBERAL APPOINTED JUDICIARY that has crushed Canadians democratic freedoms under the steamroller of Trudeaus political strategy…..

Hope fully…for all Canadians , we will succeed in the effort to sell our oil to other than the US so that we can get full value and collect the trillions of tax dollars that the LIBERALs decided to flush down the toilet over a political snit.

You might not like the truth…..but try and explain our oil being discounted and our lack of industrial infrastructure in any other way than purposeful government interferance.

#129 In GARTH and god We Trust on 05.01.12 at 12:32 pm

Hey there Stephen Harper, Mark Carney, Jimmy Flaherty. We blog dogs know you all read the wise words of the mystic bearded oracle that runs this blog. Isn’t it high time the government of Canada acknowledges in some form/award the tireless campaign of this former minister of national revenues, all knowing, all seeing, lone prophetic voice crying out in the financial wasteland of Canada??

OK, dude. Enough. Whaddya want? — Garth

#130 stickler on 05.01.12 at 12:35 pm

Well,
- Salaries are growing all across the developed world
- Social benefits are on the rise
- Tuition fees are falling
- Good paying jobs are available for a high % of grads
- Cost of living is decreasing
- Boomers are retiring early with loads of cash
- Developed countries all have manageable debt loads
- Companies are giving raises to everyone
- Everyone’s job is secure for ever

When all the above is false, what does that suggest?

Oh, and Vancouver is the best place on earth, second of course is Toronto.

#131 stickler on 05.01.12 at 12:54 pm

@ #107 Mister Obvious (nice post)
(Smoking man will like this one too)
…agree totally. I was in a meeting a long time ago full of well paid highly “educated” consultants.

The partner was conducting a woo hoo meeting & slide show. One slide showed that this particular company had significantly higher margins then their competitors…well the room cheered and clapped. They thought that was great!

I looked around the room…and I was the only one that got it…every one else was the book memorizing follow instructions type.

For those that don’t get it, the margin on “consulting” is the difference in what the company gets paid for your work vs what they pay you (the consultant)…think about it for a second.

There are many smart professionals…but there are many more who studied hard, but in reality don’t have a clue.

#132 steev on 05.01.12 at 12:57 pm

#99 Doug in London (formerly Abitibi Doug) on 05.01.12 at 9:54 am

Hi Doug,

I’m a P.Eng. Yes we study stats…extensively. No they don’t teach us how to apply that to our personal finances. Although I practise what Garth preaches my colleages/friends rarely do. You’d think we’d know better….

Cheers

SB

#133 Clueless in Kamloops on 05.01.12 at 1:00 pm

Isn’t real estate local? Surely, as has been noted here, the collapse is now happening, and given bubbles implode inward to the center, RE is now a good investment in 2nd and 3rd tier locations? So isn’t now the time to buy in specific locales where the markets have since corrected?

#134 John G. Young on 05.01.12 at 1:01 pm

#46 penpal on 05.01.12 at 12:00 am

““Others here could care less about you..”

That’s odd, you are the only one I see here complaining about my posts with any regularity.”

I guess you haven’t checked today’s posts.

What a tiresome, hateful person you are.

I pity you.

#135 borrowedcarbon on 05.01.12 at 1:03 pm

Thanks Garth. I just applied to rent a place at $1800 that would cost me $2700/mo to “own”.

Your GreaterFool decoder amortization bracelet is in the mail. — Garth

#136 bigrider on 05.01.12 at 1:04 pm

I heard that there was a builder looking to set up a drive through condo purchasing experience.

Orders by the six pack and dozen discounted much like donuts.

A good way to avoid the lineups and traffic jams new home sales create I guess.

#137 Junius on 05.01.12 at 1:05 pm

#129 truth hammer,

What a bunch of baloney. You are seriously blaming the lack of oil revenues on the Liberal government from the 70s? Since then we have had a Federal majority under Mulroney and now Harper along with a Conservative government in Alberta for the entire time.

I was no fan of the NEP but that was 40 years ago.

Are you serious? Or am I missing the joke.

Stallions never forget. — Garth

#138 stickler on 05.01.12 at 1:05 pm

@ #129 truth hammer

Without getting political, I agree that Canada’s lack of an energy policy is infuriating.

I think that before sending off resources to other Countries Canada needs to build a reserve. Refining our own resources and supplying the whole country before exporting (rather then importing from other countries) would make a lot of sense too.

There is a lot of political BS as to why it is perceived as not economically feasible to do so.

Changes to NAFTA would be required of course. So it will never happen.

#139 Junius on 05.01.12 at 1:12 pm

#72 Aussie Roy,

The comparisons between Canada and Australia are fascinating. Clearly we are behind by at least a year but it gives us a good glimpse at what a slow melt looks like.

I love this quote:

There is a seller strike and a buyer strike,” Prosper Australia Campaign Manager David Collyer said today.

“We are seeing a house price ‘SLOW MELT’ as sellers hold out for peak prices while buyer indifference means few properties are sold”.

Prices are always sticky on the way down but down they go when there are fewer buyers.

#140 bigrider on 05.01.12 at 1:24 pm

Everybody talking about housing ‘zombies’ walking around T.O and Vancouver.

At least you can run from a zombie.

What about house infected ‘mutants’. Think movies like ‘ I am legend ‘.

Can’t run from these fast moving crazed hominids.

Last night ,very late, I saw a group of freaks licking bricks ,rubbing on garage doors..one had a piece of eavstrophe hanging from between its legs.

I shined my car lights at them and they came right for me, asked where I lived, chequebooks in hand shrilling numbers.

Then again, could have been RE agents.

#141 Derek R on 05.01.12 at 1:39 pm

#71 TRT on 05.01.12 at 2:59 am asked:
If CMHC, BoC, low int rates, and lax lending policies led to high RE prices in Canada, then why aren’t prices in London ON and Vancouver BC the same?? Why arent prices in Prince George and Toronto the same??

Because RE is local but mortgages are national. Real estate prices depend on two things: local average wage and price of credit. The first governs what people can afford to pay per month; the second governs how big a loan that monthly payment can buy. The price of houses depends on the size of loans available.

So in Liverpool, NS the average wage is low, so people can only afford to borrow smaller loans, so they pay lower prices for housing. In Toronto, ON the average wage is higher so people can afford to borrow bigger loans so they pay higher prices for housing.

But if the banks double interest rates tomorrow that affects the whole country, so both the Liverpudlians and the Torontonians will only be able to afford to borrow half as much. Prices will still be higher in Toronto than in Liverpool but in both places they will drop to half their former level because people will only be able to borrow loans that are half the size.

On the other hand if the paper mill in Liverpool closes down, Liverpool housing will drop in price because the average local wage will drop, so Liverpudlians won’t be able to afford loans of the size they could before. But that won’t affect Toronto prices at all.

That’s why prices in London ON and Vancouver BC aren’t the same; that’s why prices in Prince George and Toronto aren’t the same. And that’s why they are all too high.

#142 Market Bull on 05.01.12 at 1:40 pm

The market for suburban McMansions may be virtually non-existent in certain areas in coming years. — Garth
_____________________________________________

This notion is without doubt the greatest real estate myth currently being floated.

It is generally accepted that the baby-boomer generation spans 20 years. That means approximately 5% of those eligible and willing, would have to retire AND sell their homes every year for the next twenty years to consume the entire housing stock of the boomer generation.

Not only will many people be working far longer than they planned for, but it is a fact that most people hate to move, seniors most of all.

The coming Mcmansion glut is greatly overstated.

Nice veer. I said many will be illiquid. As for how many hit the market, well, I think you’ll be quite surprised. — Garth

#143 Aussie Roy on 05.01.12 at 1:46 pm

Junius
on 05.01.12 at 1:12 pm

#72 Aussie Roy,

The comparisons between Canada and Australia are fascinating. Clearly we are behind by at least a year but it gives us a good glimpse at what a slow melt looks like.
…………………………………………………………………………

Yes, it is fascinating for me to, many of the bulls on this site, quote the same delusional reasons why it’s different this time as the cheer leaders use in Aust. I suppose that’s why they are called bulls – lol.

It’s not different of course, and you probably wouldn’t believe how many here (inc Govt RBA etc) still see no problem and certainly no bubble. I fear there is a long way to go before the person in the street starts to think for themselves, the many years of house price brain washing and worshiping has really twisted many minds, in both our countries.

Hi BPOE…

#144 disciple on 05.01.12 at 1:47 pm

#129 truth hammer… Surprise! It was Mulroney who sold out Canada to Reagan, and Harper is trying to finish the job by surrendering our borders to the USA and our remaining businesses to The European Union through CETA. Shelley Ann Clark exposed it all:

http://michaeljournal.org/kealey.htm

#145 Mr. Jim Lahey, Sunnyvale Trailer Park Supervisor on 05.01.12 at 1:52 pm

#142 Dererk R.

“Why arent prices in Prince George and Toronto the same??”

Derek buddy, the answer is simple. Location, location, location. What dictates the difference in prices within Toronto itself for example? Same thing. Location (on the subway line), location (swanky neighbourhood), location (not near hydro wires, highways, Ricky and Julian have shootouts).

#146 Canada's housing crash under way on 05.01.12 at 1:59 pm

Some key point in the article below. The housing crash is 100% going to happen. We will all see the house of cards fall apart. Realtors all know it and so do mortgage brokers. Stay away from the crashing RE bubble.

According to data collected by the Canadian Real Estate Association, the ongoing housing boom is increasingly funded by mortgage debt that’s not coming from Canada’s highly regulated banks.

The act of pushing borrowers further out of the mainstream — it’s currently estimated that banks are rejecting as much as 20 per cent of the mortgage applications they receive because they’re no longer insurable by CMHC — is potentially troublesome.

The people who no longer qualify for CMHC protection — a number that’s now going to escalate even more quickly — pay higher fees and base borrowing rates.

Instead of three per cent, that means more people are paying six per cent for a mortgage. It means that vulnerability to even slightly higher rates could cause a significant dislocation. And that sounds an awful lot like a bubble popping.

http://money.ca.msn.com/investing/deirdre-mcmurdy/is-ottawa-about-to-burst-the-housing-bubble

#147 In GARTH and god We Trust on 05.01.12 at 1:59 pm

“OK, dude. Enough. Whaddya want? — Garth”

I thought I made it clear in my post. An acknowledgment from the powers that be that they forced out the lone voice of reason crying out in the financial wasteland of Canada.

#148 When the Credit Music Stops on 05.01.12 at 2:05 pm

It would appear from all the blog dog comments of friends living off their credit lines and from personal anecdotal evidence, it appears we are heading downthe same path as our sourther neighbour, the good ol US of A. This high wire act of credit musical chairs, (using equity in homes as ATMs), works fine and dandy until home equity starts to vanish with decreasing property values. The banks finally stop their lending game for fear there will be no more equity in the home when they repossess it. Happened in the good ol US of A and coming to a neighbourhood in Canada near you soon…

#149 cramar on 05.01.12 at 2:10 pm

Regarding 5% active listings being foreclosures in Edmonton, I have no idea what is normal. But just as a comparison, I was browsing the RE listings yesterday in one location in FL. Looking at all under $100k and there were plenty! I’d say between 50%-70% of the SFHs were foreclosures. So I figure 5% is nothing!

#150 Oceanside on 05.01.12 at 2:17 pm

A lot of boomers will sell their homes just for the sake of change when retiring. 15 months ago we sold our Okanagan home and are leasing a condo while looking for a nice small home in the country. We could have afforded to stay where we were and there are no mortgages.

On the affordability side, we had 3250 sq. ft finished and baseboard electric heat in a 1970′s rancher and it was expensive to heat, we will be looking at slightly smaller and a newer more efficient home.

BTW, I’m 61 and very few of my friends have mortgages, the ones that do are small, $20,000 to $30,000.

#151 dd on 05.01.12 at 2:17 pm

Recovery in the US? Think again…

Maybe no housing rebound for a generation: Shiller
April 24, 2012|Reuters

NEW YORK (Reuters) – The Housing market is likely to remain weak and may take a generation or more to rebound, Yale economics professor Robert Shiller told Reuters Insider on Tuesday.

Shiller, the co-creator of the Standard & Poor’s/Case-Shiller home price index, said a weak labor market, high gas prices and a general sense of unease among consumers was outweighing low mortgage rates and would likely keep a lid on prices for the foreseeable future.

“I worry that we might not see a really major turnaround in our lifetimes,” Shiller said.

The S&P/Case-Shiller composite index of 20 metropolitan areas gained 0.2 percent in February on a seasonally adjusted basis, the first uptick in prices in 10 months.

But Shiller called it “a very mixed bag.” Nine of the 20 cities recorded falling or flat prices on the month.

He said suburban areas in particular might endure further price declines as high gas prices increase demand for “walkable cities.”

#152 Junius on 05.01.12 at 2:19 pm

#142 Derek R,

You said, “Real estate prices depend on two things: local average wage and price of credit.”

Way, way to simple. How would explain the fact that prices in Vancouver are higher than Toronto or Calgary but wages are less?

#153 Snowboid on 05.01.12 at 2:20 pm

#95 Market Bull on 05.01.12 at 9:26 am…

It doesn’t take too much research to realize a reverse mortgage mainly benefits those who sell the product. Those who take advantage of this program are trading a few years of cash for losing their home when they die.

A big, paid-off house is only liquid if you can sell it. When I look around at some of the delusional sellers here in the Okanagan and the area of Victoria where we sold last year, it is obvious how illiquid they are. Despite price reductions (some re-listing) they are still sitting unsold after 12-16 months.

Of course some owners don’t care if they lose 20-30% of their home value – they still have that pride of ownership.

On the other hand, like us, it feels great to have sold when we did. Soon the Professor will work his magic on the proceeds of our home sale and other investments (now sitting with the TNL@TCU) we expect to cover almost all our rent!

#154 stickler on 05.01.12 at 2:32 pm

@ #143 Market Bull
“The coming Mcmansion glut is greatly overstated.”

How many retiring boomers do you know?

Of the ones I know they fall into 4 general categories:

1. Healthy & active -> they are selling to downsize and spend the winters south with their freed up capital.

2. Not healthy -> worked until they can’t…moving to assisted living (selling their homes to pay for it)

3. Cash is very tight -> hanging on to their homes until they are forced to downsize to reduce costs. (they cant earn much in this 0 interest environment)

4. Wealthy -> keeping their existing homes and spending winters south. (eventually they will sell)

Which category do you thin most fall into? Hint -> it is not #4.

#155 Triplenet on 05.01.12 at 2:32 pm

#36 Tim

Who owns the land in a condominium interest?
Pray tell.

#156 cramar on 05.01.12 at 2:32 pm

Taking inflation into account, U.S. home prices are down to 1895 levels.

Why U.S. house prices won’t recover:

http://www.marketwatch.com/story/why-us-house-prices-wont-recover-2012-05-01-1225310

#157 Snowboid on 05.01.12 at 2:56 pm

#103 Kevin on 05.01.12 at 10:21 am…

Although a couple of your points are true, the fact remains that the purchase of a condo is a far bigger risk than a SFH.

Prices are coming down, fees are going up – and there are often ‘hidden’ problems that the strata council won’t acknowledge.

If you are considering a condo, I would suggest renting first (or forever) – this lessens or eliminates the risk.

Although we enjoy the condo lifestyle, we will continue to rent for at least 2-3 years – maybe longer.

#158 This is Wonderland on 05.01.12 at 3:01 pm

Garth, can you comment on the cost of land in the GTA area. I’m looking for 10 acres around Caledon or Tottenham will any down turn effect these prices.

What do your crystal balls say?

#159 Arshes on 05.01.12 at 3:06 pm

#93 condopoor on 05.01.12 at 9:08 am I have two decent sized portfolios with the Orange guy’s “fund” products. Can anyone speculate how these will hold up when RE starts to making a flushing noise? I’m hoping Garth can save me yet again.
——————————————————–
I’m guessing it will go down some by the end of summer, and then back up again by end of the year. The funds are diversified and are re-balanced a few times a year to take advantage of when one EFT is down and reap the gains when one is up. Cdn and bond portion down, US portion up. This is my guess. The overall effect a still growing portfolio.

#160 Maxamillion on 05.01.12 at 3:19 pm

#141 Big Rider

“Last night ,very late, I saw a group of freaks licking bricks ,rubbing on garage doors..one had a piece of eavstrophe hanging from between its legs.”

That’s what happens every night in Woodbridge. You should see Sunday mass, holy cow.

#161 robert james on 05.01.12 at 3:20 pm

#134 Clueless in Kamloops .. I think is safe to say that clueless can also be local.. I think I would wait awhile longer before even thinking about buying real estate in BC. I think this is just the beginning of the downward spiral..JMHO of course !!

#162 Tony on 05.01.12 at 3:26 pm

Re: #7 East Van on 04.30.12 at 9:31 pm

Or next year or the foreseeable future. In fact interest rates will fall in both Canada and in America as the worldwide recession really starts to bite.

#163 Gypsy Kid on 05.01.12 at 3:35 pm

DELETED

#164 getreal-tor on 05.01.12 at 3:35 pm

#118 disciple on 05.01.12 at 11:45 am

Breast post today! If all else fails, breast to fall back to the tried and true primal marketing tactic of sex.

#165 Debtfree on 05.01.12 at 3:37 pm

@118 I saw an ad in my local paper asking for members for a breast feeding support group . So I asked my wife if I could join . She said it was a bad Idea because my hands are always to cold . I love women with a sense of humor . Re this is not a breast site . Correct me if I’m wrong …. Walkin closet , granite and stainless steel. Nesting in garage mahals . Etc. She who must be obeyed. Rumbold was a smart guy. No?

#166 Curious about the numbers on 05.01.12 at 3:50 pm

“RBC estimates 52% of pre-tax average family income is needed to own a house in Canada – even with the lowest mortgage rates ever. That leaves 48% of the after-tax portion of $83,100, or just $30,340 yearly – $2,500 a month – to afford food, clothes, a car, gas, insurance, utilities, vacations, kids, pets and sufficient alcohol. The survey noted above says four in ten of those families can’t hack it. They worry about running out of money before they run out of month. So you can kiss off any cash for the TFSA or retirement plan.”

Are you sure your numbers are correct? I thinks it’s worse than you state. Your assumptions are for after tax income of $63,208 (based on your numbers of 48% of after tax income being $30,340).

But, the RBC estimate is for 52% of pre-tax income to own a home or $43,212. This would only leave $19,996 or $1,666 per month to pay for other monthly expenses.

Am I missing something?

#167 getreal-tor on 05.01.12 at 3:52 pm

#141 Big Rider

“Last night ,very late, I saw a group of freaks licking bricks ,rubbing on garage doors..one had a piece of eavstrophe hanging from between its legs.”

Must have been a brick layer union meeting…

#168 Bill Gable on 05.01.12 at 3:58 pm

People are stretched – but someone is still spending – Hawaii bookings are humming along. American Express – Can’t live without it?

#169 Bill Gable on 05.01.12 at 4:04 pm

Mr. Turner – you might want to make sure we have an armed guard at the door – some of the comments are getting vicious, nearly Parliamentary, for God’s sake!

#170 truth hammer on 05.01.12 at 4:28 pm

Is the current government to be suspected of complicity in the HAM dirty money scheme? It would appear ‘prima facie’ that it has to be. If the government of china allows only $50,000 out of the country per citizen….then how is REV CAN not aware of the Immigration reports public in local papers of HAM non canadians landing in YVR with suitcases full of cash……and transactions in the millions for spec real estate through the several offshore banks that have opened up in Vanc and Richmond that only deal in HAM money? Is the Harper government aware that Canada is being openly used as a money laundering depot by corrupt HAM officials?

http://news.nationalpost.com/2012/05/01/bo-xilais-wife-gu-kailai-dressed-as-army-general-made-bizarre-speech-after-neil-heywoods-death/

The article states two facts clearly….that officials are exporting large amounts of dirty money….and that china allows only $50,000 to be exported……how can the Government of Canada be turning a blind eye to this? Do we not have a responsibility through UN, Interpol and FINTRAC to stop this obviously criminal activity?

Wether the boot licking liberal politically correct deniers want to deny HAM or not…..the practice of money laundering is illegal internationally……I would have thought Canada would be above recieving stolen goods.

#171 NoName on 05.01.12 at 4:31 pm

#195 Blacksheep on 04.30.12 at 5:35 pm

NoName,

“Friend or Foe of Learning–? Amount of information
we are able to extract, to learn from internet is huge,
but problem is our BIAS.”

Interject some doubt, not bad, but don’t you really
mean the problem is my bias? I’m sure you can do
better than that. Shite, why don’t we censor certain websites to avoid dangerous misinformation of the masses, for the greater good of the people, of course.

Heard some fool on CBC-2 actually suggest this.

George Orwell rolls over.

take care,
Blacksheep

My comment yesterday got nothing to do with with your bias, it got to do with everyone else’s including mine. Often during problem analysis, we will consider all available facts, but course of actions will heavily be influenced by our past experiences and, in a fact that most of the time we will chose to do action that we and crowd feel comfortable with.

One more thing EDUCATION starts at home, school is a only a tool that teaches you how to apply different tools to solve a problem. Could education be better, YES but unless we are prepared to send kids somewhere else to get educated (maybe in some school in India) nothing will change.

#172 jess on 05.01.12 at 4:34 pm

hobbes greed dilemma.

http://mandelman.ml-implode.com/2012/05/doer-update-patricia-martin-v-wells-fargo-court-grants-injunction-injustice-on-trial-ahead/
As it stands, and as a result of Wells Fargo’s handling of the matter, a 73 year-old woman is at risk of losing a home that she has owned for 43 years… and all because she fell behind on her mortgage by $104.27.

====
May Day Protest? Banks Get White Powder Envelopes – ABC Newsabcnews.go.com › USYou +1′d this publicly. Undo
19 hours ago – Envelopes containing suspicious powder were sent through the mail to at least seven locations in Manhattan, primarily Wells Fargo banks, in an … for May Day delivery, evidently arrived at the banks early, according to police ….
==

#173 NoName on 05.01.12 at 4:38 pm

forgot to add this

http://youtu.be/yU602ZaZ3Ms

#174 Market Bull on 05.01.12 at 4:39 pm

#155 stickler on 05.01.12 at 2:32 pm

Newsflash stickler: The leading ede of the boomer generation is already here and Toronto is the national epicentre for the wrinkly set.

Where praytell are all of the listings? Toronto is suffering from a listing inventory that is 50% below normal. Why aren’t the leading edge of boomers bailing on real estate?

Try thinking big picture rather than the usual anecdotal(people I know) analysis.

Most Boomers today are in their 50s, and at peak earning capacity. Stop embarrassing yourself on this blog. — Garth

#175 new_era on 05.01.12 at 4:45 pm

Be worried, be really worried. If the banks are responsible for loans, then don’t forget to take account “RISK”

http://business.financialpost.com/2012/05/01/putting-torontos-housing-boom-in-perspective/

In the next few years people try to renew, they may get a shock of their lives. No longer will there be cheap debt for those who are not fiscally responsible. Because the banks will take account the risk they are taking when they loan you the money. Your 3 percent mortgage can easily go to 6%. Even if prime stays low.

Also now that the banks are loaning their money, they want to get the best bank for their bucks. If everyone wants a loan and they only have so much to loan out, rates can go up because of the shortage of money.

So garth are you still sticking with your 15% for canada. The US already hit 30% and predicted to keep on falling to 55%. The UK is getting hit hard also.

The 15% is, as I have said many times, the initial down leg. After that comes the melt. — Garth

#176 Westernman on 05.01.12 at 5:05 pm

John G. Young @ # 23,
The last person on earth I would want coming to my defense would be you…
You should stick to playing the victim – you know, something you have experience at…

#177 45north on 05.01.12 at 5:13 pm

Market Bull: Garth: “The market for suburban McMansions may be virtually non-existent in certain areas in coming years. ”

This notion is without doubt the greatest real estate myth

Kettleby, GTA (Greater Toronto Area). McMansions cost $1 million. Totally dependent on Highway 400, the price of gas, a car that runs. On paying the mortgage. On two salaries.

Could be a long and lonely time selling.

#178 Derek R on 05.01.12 at 5:21 pm

#146 Mr. Jim Lahey, Sunnyvale Trailer Park Supervisor wrote:
Location, location, location.
and #153 Junius on 05.01.12 at 2:19 pm wrote:
Way, way too simple.

Gents, you are of course both correct. I only discussed the two main factors. I could have gone into detail about other national causes (federal taxes, amortisation periods, CMHC insurance, etc.) or other local causes (provincial taxes, municipal taxes, desirability of location, availability of supply, proportion of incomers, etc.) but my comment was already long enough and I was aiming to be roughly correct and readably short rather than to give an exact formula but be unreadably long.

#179 bigrider on 05.01.12 at 5:24 pm

#161 Maximillion.

That is exactly where I saw the freaks ..Woodbridge.

After all, there isn’t an Italian there that doesn’t build, sell or finance real estate in one way or another. Italian women have all become ‘stagers’.

Any downturn in RE and Woodbridge changes its name to Oakland CA

#180 Canadian Watchdog on 05.01.12 at 5:41 pm

BLOOMBERG: GENWORTH CEO RESIGNS

#181 John G. Young on 05.01.12 at 5:45 pm

#177 Westernman on 05.01.12 at 5:05 pm

“The last person on earth I would want coming to my defense would be you…”

You can rest assured that that will never, ever happen.

“You should stick to playing the victim – you know, something you have experience at…”

The only time I was ever a victim was when I was molested at the age of 4. But I’m sure you’ll find a way to make that my fault — your type always does.

Go back into the hole you crawled out of.

#182 Devore on 05.01.12 at 6:01 pm

Genworth CEO resigns

http://online.wsj.com/article/BT-CO-20120501-718914.html

Oops. I’m sure for family reasons.

#183 Kris on 05.01.12 at 6:03 pm

A recent immigrant, friend of my wife, very little net worth, put a 30K deposit on a 350K 1bdrm condo in north-eastern GTA that’s gonna be ready in (no jokes) 2016. Of course, more instalments of deposit are due every few months, and the final payment shortly before occupancy – This woman says, “Oh, it’s not for me – I’ll sell it as soon as it’s ready, of course prices will be higher then.”

When people with hardly any net worth are buying up with such confidence.. You gotta believe the market has more speculators than it’s safe.

#184 bigrider on 05.01.12 at 6:03 pm

#168 getreal-tor.

Nah, just a bunch of Italian, Russians, East Indians, Greeks, Persians, Chinese, Koreans, British, Irish, Scottish, Germans infected with the mutant virus called RE101-gottohumpahoma.

No cure yet despite Garth’s homeopathic remedies which so far have proved ineffective

#185 Devore on 05.01.12 at 6:30 pm

#78 House

Your solution is that people smarten up and change their lifestyle. But what chance is there for the average person when a lawyer and an engineer can’t figure this out.

Lawyers and engineers may be smart people, but they tend to be as ignorant about matters outside their area of expertise as any average person. Doctors are notoriously bad investors for example, there’s well known wisdom to run the other way once doctors (particularly dentists) start pouring into some investment opportunity. It’s like the shoeshine boy moment.

Besides, people who rely on their social connections for their livelihood need to “live it up” so they can continue to rub shoulders with those who have money. The lifestyle and financial decisions they make are driven by factors you’re not considering.

#186 Can it be? on 05.01.12 at 6:42 pm

#180, what’s with Oakland ca?

#187 Realtors and mortgage broker's know the crash is here! on 05.01.12 at 6:46 pm

GENWORTH CEO RESIGNS….Lol you realtors and mortgage broker’s must be in an all out panic. The housing crash is coming and nothing you can say or do. Let the free markets decide who gets a mortgage. You will not see the mythical HAM save your butte. Lol HAM…people are stupid to believe uneducated stupid realtors.

#188 bigrider on 05.01.12 at 6:47 pm

Funny how this pathogen RE101-gottohumpahoma spreads.

While most virus’s spread through touch, exchange of fluids and indeed some are airborne this one needs none of those elements to spread.

It’s transmitter, it’s carrier you ask ….greed, envy, inuendo, misconception, miscalculation.

No cure yet I’m afraid.

#189 Cory on 05.01.12 at 7:21 pm

I can tell you it is busy in the patch in AB. Some complacency definitely setting in again but not quite to the previous extreme.

I do very well in the oil biz here but when I fill my truck at $140 I feel like sick. It hurts!!.

Then when they take out whole neighborhoods and convert apartment buildings to “condos” for sale severely limiting the rental inventory, rents go up and it appears as though people are coming here in droves. Maybe. But It seems more like the fact mortgages and credit are harder to get and some are unable to buy and thus forced to rent.

Smoke and mirrors. And the game goes on and on and on. Won’t end even though it rightfully should have long ago.

#190 TurnerNation on 05.01.12 at 7:30 pm

Where is Beach girl and her trite, dour wisdom (on this scotch fueled weblog)?

#191 Nostradamus Le Mad Vlad on 05.01.12 at 7:39 pm

-
#173 jess — Forget the white powder. The latest is that a handful of people have been arrested for allegedly trying to blow up a bridge near Cleveland. The more FFs the better, as it will lead sheeple into a panic state, making it easier for the bozos in charge to introduce something new and nasty. Lockdown!
*
Higher Electricity Bills “And here is another example of “privatizing the profit, socialising the debt” aka FASCISM going on right now. My hydro rates are skyrocketing and we now know why: big corporations are shifting their load of hydro debt on taxpayers while they reap huge profits.” wrh.com; All central banks are printing money simultaneously, and all are failing miserably. What we see on the m$m is a charade; Six min. clip Forty centuries of wage and price controls. Trudeau would be proud; Occupy Bildeburg Resistance is NOT futile. I wonder if this is one of the reasons cameras have been banned from the Olympics (along with not flaunting the Zion logo); Interesting chart; Suicide Thanks to the money junkies in Ireland; 6:54 clip Keynesian economics a failure.
*
6.3 Chiapas, Mexico; Refusing to Fly Seems those F-22 Raptors are like the new F-35′s which Canada is buying — they’re plagued; Albuquerque, NM Stopping the use of fluoride; Iran Getting smarter each moment; Monsanto alert Top Tem GM foods to avoid, and Pix of what people thruout the world eat; The Toilet is on the move again. Needs to be flushed, ‘tho; Gadaafi Cdn. spymaster’s card found; Chris Christie “I bumped this story (originally posted April 3rd) back to the top, because CNN is now reporting that Mitt Romney is considering Christie for the VP slot.”, but Rush ‘Pills’ Limbaugh “Limbaugh; Desperately Trying To Claw His Way Back To Popularity”; Religion “But God will forgive you all for only $29.95 … each.” — Pope Benny the Rat (wrh.com).

#192 Bigrider on 05.01.12 at 7:40 pm

# 187 can it be.

I could have said backwater Kentucky , you get my drift.

#193 Blacksheep on 05.01.12 at 7:46 pm

NoName,

“My comment yesterday got nothing to do with
your bias, it got to do with everyone else’s including mine. Often during problem analysis, we will consider
all available facts, but course of actions will heavily
be influenced by our past experiences and, in a fact
that most of the time we will chose to do action that
we and crowd feel comfortable with.”

You realize the irony, in raising the issue of bias
and emotion, affecting perspective, in a forum
comment section, considering it’s generally about
open dialogue, and the sharing of ones opinion.

Peoples points of reference will be slanted to
some degree, as we are not raised in a sterile environment. I made a comment based on my
views. You brought the issue of emotion in to
it, in attempt to interject doubt, that one’s
view could possibly be skewed from life
experience, thus discounting it’s validity.

“One more thing EDUCATION starts at home,
school is a only a tool that teaches you how to
apply different tools to solve a problem. Could
education be better?”

Based on what you’ve written so far, my 21 year
old offspring’s got a better understanding of how
the SYSTEM, really functions. That’s not meant to
be an insult, just an unavoidably biased opinion.

I stand by my previous comments.

take care
Blacksheep

#194 Westernman on 05.01.12 at 8:00 pm

John G. Young,
Rest assured, your ” help ” wouldn’t be requested…
In times of travail, the last kind of person needed would be someone with a viral victim mentality-like you.

#195 Bigrider on 05.01.12 at 8:00 pm

” Toronto is the next New York” is all I hear everywhere.
Meanwhile if you really look at everything carefully , we are getting closer to becoming the next Detroit

#196 John G. Young on 05.01.12 at 8:02 pm

#189 bigrider on 05.01.12 at 6:47 pm

“Funny how this pathogen RE101-gottohumpahoma spreads…greed, envy, inuendo, misconception, miscalculation.”

Brilliant!

And a propos of today’s zombie theme, check out the movie “Pontypool” — it’s a great (and Canadian!) movie where the mode of transmission of infection is just as insidious…

#197 redcurlygirl on 05.01.12 at 8:15 pm

Glad to see a great email about Calgary. Been here since the “BOOM in 2007″ and as I told Garth when he visited, “thanks for saving us $400,000″. Sold in North Toronto and doubled from 160,000 to 330,000, didn’t like ANYTHING we saw online here in C Town for about 400,000 and decided to to do option C…leave the game and rent. Everyone thought we were nuts not to buy but so far in the past 4 years in our upscale Calgary neighborhood:

1 -Duplex next to us that we rent went on the market for 699 (ha!) last June, then to 650, then to 599 and sold in MARCH for probably under that. Met the new owner, she was the ONLY offer put in!

2-Infill houses on EVERY street corner being quickly finished and put up for sale…at 950,000 minimum..for a DUPLEX (1/2 a house!)…umm how many millionaires are there in Calgary?

3- TONS of listings on rentfaster.ca for Calgary and Edmonton..and they’re the EMPTY expensive houses..got to make a payment somehow!

Us after 4 years and following Garths advice on from his last two books?

Spent time with a FEE ONLY financial adviser found on Moneysense website.

Maxing out the TFSA and RRSPS-tax deductions go towards ski trips

Renting at three times less than having a mortgage, taxes etc on this same place and living the lifestyle..p.s rent went up this year after 4 years…by $50 bucks
(no taxes, no maintenance..our fav mantra, “not our place to worry about”)

When we leave, which we will since we here for a project, we simply sign a piece of paper, no commission, no problems!

And people say you loose money renting! we’ll end up paying for what we needed when, and banking the rest!

As Domain#5 says…bring on the popcorn!

P.S. Steven..we’re related! funny how you meet on these things! See you on FB

#198 Daisy Mae on 05.01.12 at 8:27 pm

148In GARTH and god We Trust on 05.01.12 at 1:59 pm
“OK, dude. Enough. Whaddya want? — Garth”

I thought I made it clear in my post. An acknowledgment from the powers that be that they forced out the lone voice of reason crying out in the financial wasteland of Canada.

************************************
That’s very acceptable…

#199 TRT on 05.01.12 at 8:29 pm

#171 TruthHammer

Money is ‘brought’ over here via dual transactions regardless of 50,000 limit by China. And our gov IS aware of this.

Example: Say you sell a piece of RE for a gazillion Renmimbi in China. You then exchange that Renmimbi with dollars. Here’s how: Give a company/individuals the Renmimbi they need to buy export goods (the money never leaves China), then get the $$ here in Canada from the company who has already sold previously ordered goods.

I laugh at the notion that China only allows $50,000 out of the country. ‘poor’ immigrants from India have started to bring in billions this way. There is a reason why RE is highest in TO and Vancity.

#200 GTA Girl on 05.01.12 at 8:55 pm

BigRider; your comment about all the Woodbridgian wives becoming RE Stagers made me snort…so true.

Vaughan Ontario will be ground zero for an RE economic disaster. All those newlyweds buying $700k semis on MjrMac will be divorced in 5 years.

#201 John G. Young on 05.01.12 at 9:05 pm

#195 Westernman on 05.01.12 at 8:00 pm

“In times of travail, the last kind of person needed would be someone with a viral victim mentality-like you.”

I defy you to show me one post where I have displayed a “victim mentality”: do it, or shut up about it.

With each successive post you embarrass yourself more.

#202 Westernman on 05.01.12 at 9:58 pm

John G. Young @ # 202,
I don’t answer to the likes of you, little squishy…
Never have, don’t now, never will…

#203 bill on 05.01.12 at 10:17 pm

John G. Young @ # 202,
I don’t answer to the likes of you, little squishy…
Never have, don’t now, never will…

western git…you just answered him

#204 John G. Young on 05.01.12 at 10:20 pm

#203 Westernman on 05.01.12 at 9:58 pm

“I don’t answer to the likes of you…”

Of course you do — because you always have to have the last word.

Waiting for your response…

#205 John G. Young on 05.01.12 at 10:23 pm

#204 bill on 05.01.12 at 10:17 pm

OMG great minds think alike!

#206 Marshy on 05.01.12 at 11:14 pm

Bill #204 and John G Young #204

I too am anxiously awaiting a response to your posts from Westerman. Maybe he will lose it again like he did a couple of days ago and get another spanking from Garth.

#207 Westernman on 05.01.12 at 11:26 pm

Bill @ # 204,
Well, Billy, looks like you have yourself a new playmate…
How lurid…

#208 truth hammer on 05.01.12 at 11:39 pm

#200 TRT…I’m aware of the scam out of india…a local ‘credit union’ ryhmes with ‘alsa’ and represents a terrorist group in north west india….ryhmes with ‘jab’….has been laundering the proceeds of indian dopers for at least two decades….once audited by investigators during the air india murder inquiry….but nothing was ever done….very strange.

don’t anyone think the government isn’t also turning a blind eye to dirty money being laundered in canada through the brand new banks with names including…ryhmes with ‘ina’….in the name.

#209 John G. Young on 05.01.12 at 11:51 pm

#208 Westernman on 05.01.12 at 11:26 pm

“Well, Billy, looks like you have yourself a new playmate…
How lurid…”

That’s right cowboy, it’s catching…

The stupid keeps coming, just like we all knew it would.

#210 getreal-tor on 05.02.12 at 1:42 am

#201 GTA Girl on 05.01.12 at 8:55 pm
BigRider; your comment about all the Woodbridgian wives becoming RE Stagers made me snort…so true.

Vaughan Ontario will be ground zero for an RE economic disaster. All those newlyweds buying $700k semis on MjrMac will be divorced in 5 years.

Let’s not forget Thornhill and it’s esteemed Thornhill Woods and surrounding snobbery.

#211 angela on 05.02.12 at 9:47 am

#117 FURST
Angela, do you own or rent? I need some financial advice and there’s no better place to get it than from people commenting on a blog. I need to make a decision so I can move my intellectually challenged azz out of momma’s basement.

Stay put, you’re safer there.

#212 bill on 05.02.12 at 10:53 am

“Well, Billy, looks like you have yourself a new playmate…
How lurid…”
oh what a stinging rebuke….

what weird twisted anxieties combine to produce a ”westernman”?
we can only speculate as to what happened to you to produce such a person.
I am going with his mother ate lumps of lead during her pregnancy…..
perhaps the doctor dropped him on his head at birth?

who knows? who cares?

#213 Beach Girl on 05.02.12 at 10:58 am

#101 Sometimes pedantic but never humourless on 05.01.12 at 10:01 am

Hey Beach Girl, where are you? I’m missing your cheeky posts; come home – all is forgiven!

____

#191 TurnerNation on 05.01.12 at 7:30 pm

Where is Beach girl and her trite, dour wisdom (on this scotch fueled weblog)?

____

So glad to be appreciated. I thought my comments on my personal life were not valued.

Things have gone swimmingly fine. The Lasik Surgery was a success. Saving up for plastic surgery next winter, instead of vacationing.

Have a new raft of unwed fathers and wild women. The Skinhead tattoo person left. Liked him anyway. The First Nation man left. Now we have a professional cheerleader, a repentant young man, a NCR and the flame who is flaming out. I think tubing out.

Will open the pool in 2 weeks and we all will really tone up.

Personally, I think most people are sad, communal living is the way to go. Unless you are a Mormon (moron) woman.

Thanks fellow friends. Rates are going nowhere, and neither is anyone else? LOL Except to the homeless shelter.

Oh, we are all getting buzzed and going for a walk for MS, not MLS. No one has it, but we all might meet new people.

#214 bill on 05.02.12 at 11:25 am

207 Marshy on 05.01.12 at 11:14 pm
I think the guy lost it years ago…judging from the bitterness towards his/her/it’s fellows.
however I am no expert on the matter.

#215 Westernman on 05.02.12 at 5:29 pm

Beach Girl @ # 214,
You have it right – your comments about your sordid personal life are not only not valued but stomach turning…

#216 John G. Young on 05.02.12 at 8:00 pm

#216 Westernman on 05.02.12 at 5:29 pm

“You have it right – your comments about your sordid personal life are not only not valued but stomach turning…”

That’s funny, I really enjoy them.

Back to you…