What can go wrong?

wrong

If you bought a detached house in 416 on, say, May 14th, you paid $835,522. That was the average, and that month 10,850 properties changed hands in godless Toronto. If you bought a SFH last week, you paid $694,619 – the current average. And we’re on track to see about 3,700 sales this month.

So, that’s a 66% drop in sales and a 17% reduction in price, from the peak of the bubble market. This is Gangnam big, baby. Remember it took those tacky Americans almost four years to shave 32% off housing prices and crash sales by two-thirds. Are we on track to the same black hole? Hell, even the turgid Globe and Mail (now begging for 99 cents a month) ran a piece with the headline, “Struggling real estate market can have huge impact on Conservative economic narrative.” So, did elfin deity F really mess up the way the mighty Toronto Real Estate Board claims?

“Stricter mortgage lending guidelines, including a reduced maximum amortization period and a one million dollar purchase price ceiling for government-backed insured mortgages, appear to have had the effect desired by Finance Minister Jim Flaherty. Some home buyers have put their home purchase decision on hold,” said Toronto Real Estate Board (TREB) President Ann Hannah.

So, let’s compare mano-a-mano. In contrast to last December, there are 21% fewer sales across the six-million-strong GTA. Big, ugly drop. But a year ago the average SFH in the core was selling for $708,993, so the current price is but a 2% decline.

This means if you bought a house a year ago you’ve lost 2% of the equity, plus the 4% it costs to close a house deal there. That’s 6% of $708,993, or $42,500. Of course, if you bought in May, you’re down $141,000, plus closing costs, or about $170,000. I’ve obviously not added in the amount that seven hundred grand could earn in a year invested at 7%, which is another $49,000 in both cases. All to live in a house you could have rented for $3,000 a month, saving massively.

This may be extreme math, but I’m making a point here. The only way anyone who bought a property in the last year or so can escape meaningful losses is if we see a miraculous rebound in the fabled Spring market.

Will it happen?

Will I be appointed to the Senate?

Face it: sales have fallen in Toronto (as in Vancouver) for eight of the past eight months. This is negative momentum, even at a time when mortgages are available for less than 3% and the economy’s been inching ahead. The fact those mortgage and CHMC changes crashed the market is evidence (as I said yesterday) prices were too high and had to correct. The drop of 17% from May and 2% from year-ago levels is not the bottom. There’s more to come, even with a seasonal recovery when the pansies pop. A year from now, houses will cost less.

Of course, this is not just a single-family-detached story. In the GTA semi sales are off 35% while townhouses and condo deals have fallen 17% and 26% from levels of one year ago.

Without capital appreciation – year-over-year gains in the value of a home – real estate’s a losing asset. It’s been that way now for a year in the nation’s largest three markets where a third of the population lives, and it’s about to get worse. In the GTA, for example, it costs $34,000 in closing costs to buy the average SFH, and another $35,000 to sell it. So, it has to appreciate by 10% just to break even – and still costs at least $55,000 a year to carry, even with no mortgage (the earning power of the uninvested equity, plus property taxes and insurance). That’s 50% of the average family income, before tax.

If you want financial security, rent. If, on the other hand, you want a spouse, find another blog.

SFH

Hey, here’s someone looking for advice. Should his horny young boss take a one-year mortgage on her shiny, new inflated condo, gambling rates will go down? What say ye, merry blog dogs?

I am one of the younger (18) readers of your (this pathetic?) blog, but I have a 30 year-old employer turned friend that bought an “in-construction” condo in Toronto for $475k, this was 3 years ago, so now as her time to move approaches, she’s seeking a mortgage. She has her own business but she only declares her income as $30,000 yearly. She had about $150,000 accumulated from business and savings for her down payment and the condo is now valued at about $512,000. Recently, I accompanied her to a score of banks and mortgage brokers to see what kind of rate she could get. Most wouldn’t even give her a quote, saying her miniscule yearly income makes it impossible to get a $300,000 mortgage. The lowest we got from these was 2.99% over 5 years, to then be readjusted. She opted out of that idea and got a quote of 2.59% from her local credit union for one year. She believes she could put more of her earnings next year or get quoted with a lower rate after her one year. This is concerning to me because I see the kind of bear housing market we are entering. I am not sure if the BoC will raise (to stem the growth of super bubbles like the Canadian housing) or lower interest rates (to allow irresponsible mortgage agreements and “house horniness” to continue “economic growth).
Your thoughts, or even some advice would be greatly appreciated.

157 comments ↓

#1 Comrade-conrad on 12.18.12 at 10:06 pm

Hey Garth. When are you going to write something about Edmonton? My plan is to wait two or three years my concern is that gonna be long enough? And when is a house a reasonable price ? What multiple of income 2? 2.5?

Thanks

Conrad

#2 JB on 12.18.12 at 10:14 pm

Oh what the hell… FIRST!

#3 MarcFromOttawa on 12.18.12 at 10:14 pm

It’s 9:13PM.

#4 Suede on 12.18.12 at 10:16 pm

Omg. This boss needs to read blogs.

Or learn a market lesson by paying tuition as a future loss

#5 jim d on 12.18.12 at 10:17 pm

good coin collecting idea , but my sons getting a little heavy to hold upside down

#6 Smoking Man on 12.18.12 at 10:17 pm

GARTO I don’t know if your elation is due to finally after a long long wait your call on real estate might actuly be happening. Spring will tell. Or knowing that this pathetic Blog may have made elfin diati to over react setting in motion a large belly flop for fat basterd.

Either way you deserve it, playoffs are over, does the ugly beard come off now?

#7 Oye veh on 12.18.12 at 10:19 pm

It’s all in the name….

#8 lilyflor on 12.18.12 at 10:20 pm

Get the 5 year or better yet sell the place.

#9 Vamanos Pest on 12.18.12 at 10:25 pm

Garth, cool that your following goes as young as 18. Not cool that after apparently reading your blog, he/she thinks the question is how to properly choose a mortgage when buying a condo in Toronto!

#10 Marco.R on 12.18.12 at 10:26 pm

$512,000 my a$$…she’d so screwed.

#11 AK on 12.18.12 at 10:26 pm

“If you bought a detached house in 416 on, say, May 14th, you paid $835,522. ”

A neighbor across the street sold her house back in May of this year within 5 days. She is a real estate agent.

The real estate agent obviously knew what she was doing.

Around July, the same style house 5 doors down from mine was listed and stayed on the market for 3 months without selling.

#12 Smoking Man on 12.18.12 at 10:32 pm

LaughingCon

Don’t get to exited with my last post, I’m still a bull. I just like typing fat basterd…….

#13 LJ on 12.18.12 at 10:36 pm

Advice? Your employer is stuck with an overpriced condo and has no choice but to complete the transaction. Selling would be the best idea, but that would also mean that she has to find a “Greater Fool” in the current market – a tall order.

She should probably get the variable and list tomorrow, hoping that it will sell within the year. She should also expect to be taught a tough lesson in cyclical economics.

On the other hand: “RBC: Calgary Continues To Be Canada’s Most Buoyant Market.” That is: if you consider flat prices YoY “buoyant.” In a hospital, they would consider the patient dead.

#14 Inglorious Investor on 12.18.12 at 10:37 pm

#152 Derek R on 12.18.12 at 8:30 pm

My point is, the public may get its currency from the government, but not its wealth. We do gain wealth when we have a positive balance of trade, and from productivity in general, which is the result of work, not currency. The currency simply represents the work.

As a theory, MMT amounts to a big “so what?”

MMTers will acknowledge that money, or to be more precise, currency, is not wealth. But then they go on to say that governments who are sovereign issuers of their own currency are not revenue constrained. Technically, that’s true. But in reality it’s means little. Governments can spend all the money they want, but it only has value if backed by actual wealth (ie taxes). If not, all they do is dilute the value of the currency.

MMTers will also argue that these privileged governments can never run out of money. Again, technically true, but if you press them on the issue, they will acknowledge that there are natural limits to spending imposed by a nation’s productive capacity. Unless, that is the government wishes to risk destroying their currency outright.

MMTers say that unless the government first spends money into the economy the people would have no money. While technically this is true under a government controlled currency monopoly regime, this is a circuitous and specious argument. It leaves the impression that economic activity depends on government. When really it’s the other way around. We do not get wealth from government; the government gets it from the people.

It’s true that if you reduce the money supply, economic activity will suffer. But that’s because the national currency has a government-mandated and enforced monopoly on trade. MMTers acknowledge this, but they leave the impression that by reducing currency the government is also reducing wealth, when what they are actually doing is limiting trade in that wealth.

The fact is, we do not need government to issue currency (though there are definite positive aspects to having a national, standard currency––especially for governments!). If the government did not issue a monopoly currency, or if the people lost confidence in the value of said currency, they would simply use other currencies to conduct trade.

In short, what MMT argues is technically true, but largely irrelevant and potentially dangerous. It’s sort of like guy driving a dragster in downtown Toronto during rush hour.

#15 T.O. Bubble Boy on 12.18.12 at 10:37 pm

I’m sure that the RE board will manage to blame the Teacher’s strike and the warm weather. The uncertainty over the need for snow tires has put house purchase decisions on hold.

#16 HD on 12.18.12 at 10:40 pm

She/He sounds very sharp for an 18 year old kid.

I was certainly not reading financial blogs at her/his age.

I was obsessed with other things…

Best,

HD

#17 DogWalker on 12.18.12 at 10:42 pm

I am beginning to overhear people talking about houses not selling. A year ago it was who was buying what.
This is the chatter on the lower mainland these days..

#18 Vamanos Pest on 12.18.12 at 10:42 pm

To the 18 year-old seeking mortgage advice (btw, what’s up with that?):

475 000 purchase price
150 000 down (proposed)
300 000 mortgage (proposed)
25 000 put up front 3 years ago to ‘reserve’ (or whatever) the place? Is this correct? I’m trying to put this together from your letter.

I assume if she walks, she forfeits the 25 grand?

Walk. No, wait RUN!

2 reasons:
first, never throw good money after bad, and that 25 grand is now bad money.

second, with the price correction underway, things only need to go down 5% in that price range and she’s “made back” the 25 grand (by price reduction), then you can enter the market on your terms, with your 150 large still intact. In the meantime invest the 150 Gs in the stuff Garth always talks about.

#19 NFN_NLN on 12.18.12 at 11:03 pm

#19 Spiltbongwater on 12.18.12 at 10:45 pm

Has it been confirmed the 18 year old is sleeping with the boss?

This is why people come to blogs. These are the hard hitting questions the MSM won’t touch, Hahaha.

#20 Ryan Tynd on 12.18.12 at 11:04 pm

“I’ve obviously not added in the amount that seven hundred grand could earn in a year invested at 7%, which is another $49,000 in both cases.”

What gets you 7%?
That is part of problem, your struggling to get 1% – so people take gambles… and all too often they look at Housing and see its 25 year track record – that looks safe…

#21 Nemesis on 12.18.12 at 11:06 pm

“Will I be appointed to the Senate?” – Hon. GT

Ya know… for political junkies… of any stripe…

That is an extravagantly funny joke.

[No reflection on you, OldPol... but rather, institutionalized political anachronisms.]

#22 T.O. Bubble Boy on 12.18.12 at 11:09 pm

A $694,619 SFH would need to gain over 20% to hit that Mid-May peak again… what is the peak-to-trough seasonal range for avg price you ask?

Peak is typically about 9%-13% higher than the trough:
http://guava.ca/indicators.html

A 20% avg price gain from now to May 2013 would be almost unheard of (in recent history).

#23 Confusions on 12.18.12 at 11:11 pm

Despite the daily message and discussion on this blog and others, I get the distinct impression that a lot of the commentors cannot wait to get their hands on some property. Comments like “I am just waiting to vulch”/”buy next year”/”buy in 2014″ …. No different than the HVs mentioned regularly, just more scared.

The key message is being lost here. Don’t crave ownership at any price unless it make financial sense. If the price of the property is less than the cost of renting and the opportunity cost of capital invested, then buy, else rent. Will buying the property concentrate your net worth into one single asset class and leave you undiversified? Else understand that you are speculating and that has both an up side and a down side exposure.

#24 love_depends on 12.18.12 at 11:16 pm

Garth the latest from David Rosenberg:

The conservative investor should maintain a defensive posture

David Rosenberg, the top strategist from Gluskin Sheff, unveiled his expectations for the markets in 2013.

Here are some key takeaways

stocks will be flat, and investors should focus on dividend growth, defensive stocks, and gold miners
interest rates are going nowhere, but long-term interest rates will likely go down
corporate bond prices could go up because credit spreads are still wide
gold looks attractive
oil looks attractive long-term
copper looks good if you think China is coming back

#25 Grim Reaper/Crypt Speculator on 12.18.12 at 11:19 pm

OMG….

Smoking Man hasn’t been DELETED yet….?

Something is amiss…….

P.S. try again S&M

#26 Smoking Man on 12.18.12 at 11:29 pm

DELETED

#27 Smoking Man on 12.18.12 at 11:36 pm

#26 grim

Not drinking tonight, I dedicated one night a week to liver healing. I am sipping a green tee.

#28 wes coast on 12.18.12 at 11:39 pm

Let your boss/ friend figure her own issues out. If she can run a business she can certainly deal with her challenges of getting a mortgage. Best not to involve yourself in other people’s financial issues (look how much hate mail Garth gets).

#29 HogtownIndebted on 12.18.12 at 11:49 pm

Yet another example of RE duplicity here in hogtown.

This place was on market for over 180 days, not 35, and sold for only 80% of list, not “99%”

From TREB:

102 Branstone Rd Sold: $680,000
Toronto, Ontario M6E4E5 Toronto W03 Caledonia-Fairbank List: $689,900
Orig Price: $689,900 Taxes: $4,426.68/2012 99 % List
SPIS: N Caledonia-Fairbank 114-15-L DOM: 35 Contract: 11/12/2012 Sold: 12/17/2012

From Guava:

W2333457 – M6E – 102 BRANSTONE RD Toronto, Ontario – $799,900
Price Change. Sep 1: $799,900 Apr 12: $849,900

MSM coverage of the real estate slippage tonight on CBCnational tv and local radio is front and centre. What a difference a few months makes.

The SFH will be affected in Toronto; no area will be immune. People’s underlying financial weakness has only begun to get exposed

(sorry if this was posted twice – did not see it when I checked the last blog entry)

#30 Chickenlittle on 12.18.12 at 11:52 pm

SM: “Either way you deserve it, playoffs are over, does the ugly beard come off now?”

“Let me know if my beard tickles.” – Garth

Talk to the hand, SM, cause the beard aint listening.

He would shave it, but it has grown so attached to him.

Q: What is forty feet long and has eight teeth?
A: The front row at a Willie Nelson concert.

It’s Beard Tuesday! :)

Garth, only you could pull off that beard. I tried and it didn’t budge.

OK I’m done. I just love really stupid beard jokes for some reason.
Love you, Garthy.

#31 Smoking Man on 12.18.12 at 11:53 pm

Unce be known to my wife I have slipped gin into my tea.

DELETED

#32 Smoking Man on 12.18.12 at 11:59 pm

Ah Garth is your advance that sensitive. I know you where laughing ur ass off, Your next book should be smoking Man deletes. It will out sell all your others put together.

#33 coastal on 12.18.12 at 11:59 pm

GlobalBC tonite admitting the party is over and finishes their segment with the death knell quote from Cam the Scam in full denial mode, just like a guy dumped by his jilted lover cause he’s been caught BS’ing one too many times.

Now we will see the reality of a true blue real estate correction slowly float over the stormy waves to Victoria where the same BS artists have been busy deflowering the house and condo virgins with the same pathetic denial. Don’t want to offend all those recent sheep, I mean buyers, who were told the market will flatline for the next five years, right ? Man, that’s gonna suck.

#34 Devore on 12.19.12 at 12:01 am

#15 T.O. Bubble Boy

See, that’s the problem with real estate. So finicky when it comes to weather. It cannot be too nice (then people are enjoying it instead of buying houses) and it cannot be too crappy (then they are staying home instead of buying houses). It has to be _just_ right. Unless prices are going up, in which case it does not matter what it’s like outside; everyone is buying so they don’t get priced out forever.

#35 Paully on 12.19.12 at 12:06 am

You should call the CRA and anonymously rat her out. Based on your story, she is lying about her real income to illegally save on her taxes. That is costing us all money!

#36 Devore on 12.19.12 at 12:09 am

And for the hero of today’s blog…. this is definitely one area sticking your nose into, invited or otherwise, has absolutely no upside. Just smile and say they are smart enough to figure this out for themselves.

#37 kreditanstalt on 12.19.12 at 12:14 am

Chutzpah!

I do get a kick out of the real estate cartel…blaming the loss of ultra-cheap mortgages via 40-year amortizations, etc., for their woes…

If their sad little business model has become utterly dependent on ultra-ultra cheap fake money, and permanent-debt status for the pitiable “buyers” who now have to come up up with – WOW! FIVE PERCENT! – then maybe it should have died stillborn.

We’ll be free the day mortgages go to 20%p.a., government money-printing-via-debt issuance ends and when mortgage money consists wholly of SAVED-UP CAPITAL.

#38 Richard on 12.19.12 at 12:22 am

If you are going to compare May with November sales numbers, at least seasonally adjust your numbers.

Like buyers can seasonally-adjust their incomes and down payments? — Garth

#39 Smoking Man on 12.19.12 at 12:24 am

Loaded smoking Man looking at the picture. Bald dude let the kid go. One day the prick will be in his 20s drop him now……..

Wish I did

#40 prairieperson on 12.19.12 at 12:39 am

Two nice houses nearby. Open house sign on one. Only car is the realtors. I haven’t seen any potential buyers pulling up. No oneeven slowing down to gawp. The buying fever has broken. Now the sweating begins for those who have places for sale. I did see one sold sign today. Had a friend whose husband recently died say she’d wait until the spring and put the house up for sale. He and how many others. My prediction re retirees selling in the city and building big houses in the country is coming true. Heard a couple of stories of age related illness forcing couples to sell. What were they thinking? Sell in the city where there are hospitals, doctors, ambulances, chiropracters, optometrists, audio specialists, drugstores, grocery stores, close by and build a house large enough for a family with four kids five to ten miles from the nearest town and never stop to ask what happens to people as they get older re health? Or, who is going to buy this place? As big a disaster as Vancouver might be, a crash in sales will be far more brutal for the outliers. In the city, it may be that you want to sell but have health problems in the country and have to sell because you need health care and you take whatever you can get.

#41 hangfire on 12.19.12 at 12:42 am

I’m wondering why rents keep going up in spite of the increase in inventory and the decrease in prices? Rental stock in Vancouver is abysmal..and what is available is beaten up and scummy….otherwise the ask is astronomical for ‘executive quiality’ rentals. Anything below that is moldy…dumpy….effed up entirely amid in putrid locations….inc high rise options. Could these be reasons why people are still buying ( catching the falling knife as pointed out) and getting suckered in real estate knowing they’ll lose from day one?

#42 cramar on 12.19.12 at 12:54 am

I finally figured out the reason that Vancouver RE is priced so high compared to here in the very southern tip of Canada. Vancouver has the added benefit of getting snow first! Priceless!

#43 Smoking Man on 12.19.12 at 12:56 am

Any one you dogs try and plug the power cord into the fking phone after hell, a 1/2 bottle of jager. Damn this us hard

#44 robert on 12.19.12 at 1:09 am

There is little to deny just follow the wisdom in supply and demand. There are fewer buyers from a year ago and that list is shrinking daily. As any trend this will pick up steam and without a turn around in spring its all over. The only question is how fast and how severe will property values drop. When the general public come to understand that spring is not going to change the landscape in fact it will probably worsen, that will be the beginning of the panic phase. Why anyone would even consider buying a house in this global economic chaos is beyond me. The U.S. is bankrupt, add to that Europe and Japan. I have followed Garth for 15 years now and his work on demographics specifically of the Boomer Generation has been spot on. I think his market advice is terribly flawed though and if i was 50 years plus i would get out now. With massive deleveraging comes black swan events and i expect that we will see a huge market meltdown in 2013 that could destroy your retirement funds.

#45 Interesting Times on 12.19.12 at 1:13 am

A very hard landing is coming for many, make sure you protect yourself!!!

HGTV Virgins get out there and start low balling these realtards by 50 percent. Don’t waste your time going to open houses when you could just sit on the MLS and low ball these used car salespeople by email. Get out there and get your revenge. Show them that you are not as stupid as the show protrays you!

– Europe already in recession/depression, Japan and US right behind them. This will have a negative feed back loop across the global economy.

– jobs being lost everywhere and the Canadian economy is slowing down. Watch BNN and learn about the layoffs happening everyday or just read the business section it is all there for you my virgins. Educate yourself!

– austerity starting already in Canada. Many in government jobs will be bye, bye.

– manufacturing jobs have moved to Asia and back to the US. Canadians can’t compete with the New America where the factory worker now makes $12.00 an hour and can buy a nice home for $100,000K. You are so screwed in Canada!

– 70% of CDN living pay cheque to pay cheque and have no savings and over 70% have no pensions

– 60% of boomers 60 years and older entering retirement in a shit load of debt. Also, a lot of these boomer fools co-signed for their kids $800,000 Mc Mansions. The banksters will wipe the floor clean with both the kids and parents after this 50% RE Crash when they both lose there homes!

– empty condos being built everywhere and will be going for 50% off soon. HGTV Virgins will be crushed!!! Many HGTV Virgins are going bankrupt at Trump Towers, what happened to RE only goes up?

– empty homes all over the MLS, can you say power of sales have started, soon 50% off will be coming to Canada

– for lease signs everywhere in business districts and commercial areas, I guess business has moved out of Canada

– Canadians are 164 percent in debt! More than the US, Ireland, Spain , and UK when they had there RE Crash.

– Over 8 months of dropping RE sales. Next thing to drop will be prices by 50%.

– over 70% of mortgages in Canada are 5% or 0 down CHMC mortgages. Can you say high risk and backed by the taxpayer. When this baby blows up kiss your social services good bye. This is what the in action plan looks like. We supported our banks with free taxpayer dollars to give out loans to people with no money creating a RE ponzi scheme 10 times bigger than the US, Spain, Ireland etc.

– And remember a home is only worth what a buyer will pay.

– the realtards, brokers, banks and builders are in full out panic

The 50% crash is here my virgins. Get out there and start low balling as the time is now for your revenge. Don’t sign up for bank slavery like the other 70% of the virgins in Canada. They are screwed for life now as they were sold the Koolaid by the RE industry!

Garth thank you also for the great public service you are providing for all the HGTV Virgins out here!

#46 Blacksheep on 12.19.12 at 1:21 am

REMOVED BY REQUEST

#47 Mel on 12.19.12 at 1:24 am

I agree with Confusions. Buy ONLY when renting does not make ANY sense anymore. Otherwise, there is no point of owning. Money will be better invested somewhere else.

As for me, I have no timeline. I will wait until it will make financial sense. Otherwise, why rush? Renting is soo… much better in so many ways. It is very possible I will be renter for life.

For all of you who seem to have itchy feet. Remember this, price declines will entice people to buy too early. It is like a ladder going down, try very hard to hit the ground.

#48 Nostradamus Le Mad Vlad on 12.19.12 at 1:49 am

-
What can go wrong? If Murphy’s (Law) is present and correct, everything that can, will go wrong but no reason will be given. Who is going to pay for the clean-up? Ask taxpayers!

“Your thoughts, or even some advice would be greatly appreciated. If you want financial security, rent.” — Rent. 4ever. In doing so, build up a nice slush / retirement fund. Let others get sucked into the black hole of debt.

#26 Grim Reaper/Crypt Speculator — “OMG….Smoking Man hasn’t been DELETED yet….?”
and
#27 Smoking Man — “DELETED”

Asked and answered!
*
Bank Bailouts Trend across the west. Is it because the west is broke? Erosion Purchasing power from inflation; California’s Wage Insanity See the head; One Million homeless students in the US (at least); Globalist Whore Michael Moore. Someone / thing may have changed his outlook; Speculation on a bond market crash; The Grinches who stole CPP. just as the WH is stealing SS; Baffling Mathematics and stuff; US out of top ten most prosperous nations; No Deal American port workers still out; To Dream the Impossible Dream How to make men enjoy shopping.
*
Western Pacific 177 ‘quakes Tuesday; 2:26 clip What no one dares say about the killings in Conn., and The Globalists Headline says it better; Iran — No difference Iran has a valid point; Arkansas The authorities are terrified of people, and it is easy to surmise why Gun Sales are racing ahead. Also — DHS What is the DHS preparing for, and why are they buying so many rounds of ammo? The fiscal cliff (if there is one) is close to being solved; Mexico has the strictest gun control laws in the west. How is the CIA drug-running operation going? Crazies The headline describes better why politics and politicos should be disqualified from humanity; Life is Dangerous Ban it! 44:43 doc. Toxic Beef from big beef and big pharma; Interesting Obomba sheds crocodile tears for Newton, yet the US invades Africa. Double standard? Plus Kyrgyzstan and Russia Joining forces while jockeying for position, and US selling Oman bombs and stuff; The Vomitorium is in full swing at the height of xmas season; The Queen and her evil deviants; Drugging or dumbing down? Could be the former; Short clip End of old or beginning of new Mayan Age? Diet Moods Life is too short to focus on dieting; New Imaging System could replace stealth technology.

#49 Mark on 12.19.12 at 1:51 am

BoC raising policy interest rates? Not a chance with the horrible no-growth economy, especially in a RE crash.

But that doesn’t stop the banks and mortgage investors generally from demanding higher lending spreads, on account of the higher levels of risk posed by the housing market. Banks are all too pleased to provide cheap credit when assets are appreciating, but they earn the big bucks during the deflation.

I personally would even suspect the BoC’s next move will be an interest rate decrease. But of course this won’t help homeowners as the banks are unlikely to move their rates in response — merely booking the extra profits to their balance sheets and increasing their dividend payouts.

RE is trash. REITs are trash. Owning interests in large-cap solid businesses is where its at these days. TSX = 17k next year, mark my words.

#50 CalgaryPriceWatcher on 12.19.12 at 1:57 am

OK but there is a typical annual cycle of peak sales in the spring and bottomed out sales in December. You can’t possibly say right now that the market has tanked by 17% in price-that is ludicrous. Come back in a year to see how much it has actually dropped.

#51 Alex G. on 12.19.12 at 2:06 am

To answer the question posed in today’s post:

First of, I’m guessing that your boss’s income is listed at $30,000 to avoid having to file for a GST tax number (among others) and that she has actually a significantly higher income than that per year. How much it is and the issues of tax avoidance are non of my concern here; just wanted to set things straight from the get go.

If she is self-employed and her salary truly is only $30,000 she probably would be best served having someone else handle her finances because a $300,000 mortgage represents 10x her total yearly minus “standard” income taxes (assuming no deductibles) she’s be left over with just under $26,000 after tax; making her mortgage a nice 11.53x disposable income. Oh and this is before property taxes, condo fees, electricity, food, gas, and all those other lovely things. No wonder most banks didn’t want to get involved; would you?

The scary part is that she found some credit unions to pony up the money, despite all of this. And no, there are no sub-prime mortgages in Canada… riiight…

So let’s get back to reality, shall we? She probably makes more than that per year but again the credit union’s decision should technically have been based on her reported income.

Assuming that she actually has a larger somewhat steady income, she might actually be able to afford the place (in terms of wasting her money on it but at least being able to still eat noodles). A few key questions: With the lousy quality of many of the condos that have been built recently, does she know what the reputation of the company her condo has been in the past? What are her condo fees like? What would her penalty be if she decided to cancel the contract; just the $25,000 that she already put down or would she be on the hook for more? Why does she want to own? Please don’t tell me that she considers this to be an “investment”.

Get her to answer those questions and then do the math of whether she can afford it or not. If it costs her only the $25,000 to walk, that would probably not be a bad idea. Then she would still have her $150,000 to invest in preferreds, REITs and the like and rent the same place for a fraction of the price. Plus that way she won’t have to deal with paying 5% to her real estate agent when eventually selling in X years.

Getting the variable rate might sound appealing if she thinks she can get a greater fool to buy it at a premium in the spring (highly doubtful). But even then, certain penalties will have to be paid seen as her term might be of 1 year but her amortization will certainly be for closer to 25 years, so just reimbursing the bank the monies owed won’t make her “not lose” any cash.

If she is utterly irrational and absolutely NEEDS the property, go for the 5-year fixed; the 0.40% extra is negligible and suggesting that rates will drop from their current levels is rather ridiculous. Don’t get me wrong, they may drop, oh let’s say… 0.50% but it’s unlikely. On the other hand it’s far more likely that they will go up multiples of that.

Don’t forget that back in the late 1980s (I know, I know, you weren’t even born then but your boss was) rates were in the mid-teens and close to 20% in certain cases. Will we see that anytime soon; doubtful but running around to get a 2.59% instead of a “high” 2.99% interest rate is rather ridiculous; especially considering that there is a good chance for the fixed rates to start moving higher due to actions in the bond markets over the next few months; no matter what the Bank of Canada tries to do with the variable rates. So locking in a 2.99% for 5 years is actually very cheap money.

It’s still insane to use that money to buy a condo in Toronto given the current realities of poor fundamentals, interest rates that will rise shortly, an aging population, over-construction, an overall slow global economy (and Canada primarily a natural resources economy), and so many other things that Garth has mentioned repeatedly.

Hope that clears things up.

#52 VanDude on 12.19.12 at 2:10 am

Appointed to the senate. How could you handle the massive work load with the responsibilities you already have with this blog?

#53 Tom from Mississauga on 12.19.12 at 2:12 am

Under the new mortgage rules she will not qualify for financing. Don’t put another penny into it. The down payment is gone.

#54 Tom from Mississauga on 12.19.12 at 2:18 am

The letter reminds me of the Cambridge photo you lead with the other day Garth. Was the builder there stuck with empty homes as their buyers couldn’t get financed under the new rules?

#55 Burnaby Renter on 12.19.12 at 2:19 am

If we had an elected senate, you would be in it.

#56 Tom from Mississauga on 12.19.12 at 2:21 am

Valued at 512K? Says who? The builder?

#57 The Bear on 12.19.12 at 2:22 am

By the way, I am the one who asked for advice.
#9 Vamanos Pest

She already has a down payement down on it, if I could I knew she’d do something as stupid as buy a condo at the top of the market when she did I would’ve smacked her. It’s just managing the current situation.
#18 Vamanos Pest
As for her throwing in “Good money after bad”, I know she wants to live in the place. Now if she wanted to live there for the rest of her like I wouldn’t come to this collection of pessimists, but the problem is she wants to resell within 5-10 and move into something better. So if there is a market correction big enough and the bubble pops, we probably won’t see such high prices in the GTA until inflation catches up a decade in advance. Plus, all I could do is give her advice haha.
#19 Spiltbongwater
Sorry to disappoint, but I don’t mix my work and my pleasure.
#36 Paully
I get paid from this business luxuriously as far as fellows my age go. Don’t bite the hand that feeds you.

I usually read every few days, but I rarely post.

#58 Tony on 12.19.12 at 2:26 am

Fiscal cliff or no fiscal cliff either way America will be recession next year. Canada’s real estate crash will mean rates will actually fall further in Canada than in America in 2013.

#59 Tamerlan on 12.19.12 at 2:31 am

Ha! I don’t buy home not because of Flaherty’s new rules, but because Garth told me not to. Duh!

#60 Derek R on 12.19.12 at 2:46 am

#14 Inglorious Investor on 12.18.12 at 10:37 pm wrote:
My point is, the public may get its currency from the government, but not its wealth. We do gain wealth when we have a positive balance of trade, and from productivity in general, which is the result of work, not currency. The currency simply represents the work.

Ah, so you do get MMT. You just don’t think that it’s the whole story. Well, I agree with that. If you don’t have the real wealth to back it, the money is worthless. MMT’s biggest flaw is that it talks about money but almost ignores production. So it’s only describing part of the economy. But in that it’s no worse than mainstream economics which talks about production but almost ignores money. Put the two together and we might get somewhere with understanding how the economy really works.

#61 BillyBob on 12.19.12 at 4:12 am

“Will I be appointed to the Senate?” – Hon. GT

In a just and sensible world, yes.

#62 markc on 12.19.12 at 4:36 am

You surely can’t mean that people lie to the tax authorities about their income in the colonies as well? Good Lord above. And we thought you peeps were honest.

Regardless of the market conditions, if the boss has declared $30k as income, that’s her income for mortgage purposes. Sounds like she’s stuffed herself well and truly; contractual obligations, and no funds. People found themselves in the same boat over here when the regulator trod on “self certified” a.k.a. liar mortgages.

There is such a thing as trying to be too clever. Schadenfreude is alive and well and – evidently – living everywhere.

#63 Onthesidelines on 12.19.12 at 5:22 am

Re your graph, Garth. Just from a layman’s perspective, I don’t see anything particularly telling. A bit up, a bit down, a bit up again, then down….. if that’s supposed to indicate some sort of steady, dramatic decline, I just don’t see it. What am I missing?

#64 Buy? Curious? on 12.19.12 at 6:35 am

Garth, is it me or are things starting to unwind faster? I know you were mocked at not having the right date to the beginning of the Age of Fear. I’m seeing For Sale signs popping up everywhere. I’m also over-hearing more conversations of people commenting on other’s financial difficulties. I could have sworn just a few months ago people talking about doing reno’s or moving a couple streets closer to Leaside. Now you’ll see people spending less. Sure you won’t see it at Yorkdale with a packed mall, but if you ask anyone how much they’re spending this Christmas, I can be sure that it’s less than last year! And then as the panic takes hold in Spring and realtors, contractors, furniture sales folks, etc starting losing their jobs, wait to see what next year at Yorkdale will look like. It may see like a long time from now but things are going to change for alot of people accustomed to living the high life.

http://www.youtube.com/watch?v=BkKWApOAG2g

#65 blase on 12.19.12 at 7:24 am

So Garth, The glorious GTA, home to the most diversified economy in Canada, home to the best banking sector in the world, welcome wagon to the world’s immigrants, has already seen a 17% reduction in home prices? Looks like the crash you have been poopooing is in full effect. Revert to mean, then go below.

We are now entering that glorious time when people look at a home the same way they do a cabbage patch doll end of January, price reduced 90%, no takers. Nobody wants to catch the falling knife.

The drop in SFHs in 416 is not a market-wide ‘crash.’ So far it’s the first stage of a healthy correction. Stay tuned. — Garth

#66 Asse on 12.19.12 at 7:27 am

Funny, very few for sale signs, msm listings, in my neighborhood. 2 million dollar top ups, one done badly and a few trying to capture $700 bungalows that wouldn’t have sold last spring.
If the figures work themselves out properly maybe in spring we’ll upgrade..always wanted a concrete pool. Only things that matter are price differential and interest rates.
Worked construction in 91, only crews on the sites were family. Many just sat in coffee shops waiting for things to get better. Many also had wads of cash from the private jobs that kept them going. And ex’s father went to the garage for the cash to buy a new jetta. I also remember unemployment averaged around 10-12%. Many people hurt, but not the ones you’d expect. Be careful what you ask for, you might just get it.
Merry Christmas Doomers!

#67 mark on 12.19.12 at 7:29 am

Just saw Cameron Muir on Global Vancouver. Apparently the mortgage rules were primarily implemented to help fix the excesses of Toronto and they’ve only served to hurt Vancouver in the process.

How does a person like that sleep at night?

#68 Aussie Roy on 12.19.12 at 8:27 am

Aussie Update

It’s all the governments fault

Next year’s federal election could have a big impact on the property market, experts say.

Though the senior economist of Australian Property Monitors, Dr Andrew Wilson, is still tipping prices nationally to grow between 3 and 5 per cent next year.

Comments are better than the story

http://smh.domain.com.au/real-estate-news/election-the-unknown-for-next-years-market-20121212-2b9vu.html

So they’re a return to the usual property mantra that house prices always rise faster than consumer prices because of the “fundamentals” of (a) a rising population and (b) tight supply.

Unfortunately, that once popular rap is out of tune with the actual performance of the market for the last two and a half years. House prices peaked in June 2010, and have fallen 4.1 per cent in nominal terms and 9.8 per cent in real terms between then and September 2012 (the most recent date for the ABS existing dwelling price index).

Firstly, the “this place is different” argument that says we can ignore what has happened overseas is not holding up so well after just over two years since its peak. While Australia’s house price fall post its bubble peak is clearly different to America’s crash, it’s on par with that experienced in Japan’s long slow melt.

The recent tiny uptick in nominal house prices in Australia was driven by an acceleration in mortgage debt too – even as the rate of change of mortgage debt was falling – but it wasn’t enough to reverse the trend for inflation-adjusted prices to fall (see figure 6). It already appears that this acceleration is petering out, and the rate of growth of nominal house prices is falling further below the rate of inflation as a result.

So American property bulls have some prospects of a rosy 2013 – though that is not guaranteed, since the rate of acceleration of mortgage debt there declined in the most recent flow of funds data (see figure 5). But Australian property bulls are likely to be disappointed. Insert crocodile tears here.

Free subscription required

http://www.businessspectator.com.au/bs.nsf/Article/Australian-property-2013-house-prices-mortgage-deb-pd20121217-32QMN?OpenDocument&src=is

#69 House on 12.19.12 at 8:35 am

I thought CMHC was close to its “debt ceiling”? Did you forget about that?

#70 Kevin on 12.19.12 at 8:41 am

The lowest we got from these was 2.99% over 5 years

Is she insane? That is an amazing rate, especially considering the meager income she’s claiming. She should be on her knees, gushing with gratitude that anyone is willing to give her such a stellar rate.

She opted out of that idea

She is greedy and it’s going to bite her in the rear.

#71 Vince on 12.19.12 at 9:01 am

I don’t normally side with realtors, but you can’t really compare December 14, 2012 to May 14, 2012 without doing some form of normalization or seasonal adjusting, the price information carries far less weight, and the ‘number of sales’ should carry no weight at all. Houses don’t sell in December because nobody lists, and you are generally advised to list in April, or the first week of September if you want to get a decent sale price.

I agree with at least a few posts on here, that you’ll either see things rebound in the spring, or we’ll see a pretty horrible melt.

I’ve bet on the latter scenario above and have a good friend considering buying a house and I told him that he may very well luck out and end up a buyer in a complete meltdown of a market. I figure we’ll have a sense of where the market is headed right around the time that the new blackberry finally hits the market.

p.s. everyday I walk by two sales centres for condos, and another one in the lobby with a person there from 12-6 daily. I’m inclined to believe that if condos were doing well, it wouldn’t take an army and aggressive marketing and incentives to persuade the last greater fools to take the plunge.

The above is why I compared not only peak of 2912 (May) to the trough (now), but also this month to the same period a year ago. Al data is relevant. — Garth

#72 phinny on 12.19.12 at 9:10 am

Now, if it were an elected Senate…

#73 Asse on 12.19.12 at 10:02 am

How to build up equity:
Buy an absolute piece of crap, worst house in the neighborhood, in the best neighborhood you can afford in a major city like Toronto.
Call friends/family for contractor references…don’t remove walls if you don’t know how.
If you can afford the space build up the basement to rent..easy $1500 in better neighborhoods with good schools.
Do the cosmetics, hardwood easy just backbreaking. Drywall even easier with a friend. Mudding is a pain but when you get the knack you save$! Laying ceramic/porcelain again easy just awkward..don’t rush and do research.
Do all this before you have children!!!
If you rent out your basement the mortgage will be mostly covered. You wouldn’t believe how many divorced single mums want a good school district the ex is paying for! Don’t forget insulation in the basement ceiling. Patience and knowledge are key.
End result $700k+ bungalow with only 99k mortgage, one of the nicest houses in a neighborhood you otherwise wouldn’t be able to afford. If you can, do again and get rid of mortgage.
Why do you think there’s so many flippers? And no, I’m not going to capture equity because it is now our home until a better opportunity surfaces. Maybe I’ll just buy some more properties, but in no rush.
Always be ready for opportunities, cash is king.

Merry Christmas Doomers!

#74 jess on 12.19.12 at 10:06 am

structure and policies shrinking income distribution ..

… the new middleman?
Payroll companies and Employment agencies

Increasingly individual firms are outsourcing false self-employment practices to payroll companies.see
Report author Jamie Elliott told how he had gone undercover, setting up a fictitious building company to smoke out rogue payroll companies.

A payroll company operates by requiring a worker to sign a contract stating they are self-employed. In many cases the worker in reality still works for a single employer but will be denied all the rights of an employee. To add insult to injury the worker is usually expected to pay for the payroll company’s services with a weekly charge (usually £15-£25) taken directly from their wages.

https://www.ucatt.org.uk/visageimages/greatpayrollscandal.pdf
================
Restaurants to be banned from using tips to top up pay
Change in law will stop bars and restaurants using tips and service charges to bring staff pay up to minimum wage

http://www.guardian.co.uk/money/2009/jun/07/waiters-tips-restaurants-minimum-wage=
=
misuse of interns
http://www.guardian.co.uk/money/2010/jul/24/fashion-industry-interns
“In the pattern making department there were 10 interns and only five paid staff. In embroidery there was just one designer and 10 interns.”
http://www.bectu.org.uk/news/548

#75 Tony Right on 12.19.12 at 10:11 am

Thanks for advising me not to buy a home!! Can’t wait to vultch a boomer.

#76 jess on 12.19.12 at 10:23 am

ethical investing

a teachers pension fund is heavily invested guns

ZURICH Dec 19 (Reuters) – Swiss bank UBS was hit with a $1.5 billion bill and admitted to fraud on Wednesday in order to settle charges of manipulating global benchmark interest rates.

“We deeply regret this inappropriate and unethical behavior. No amount of profit is more important than the reputation of this firm, and we are committed to doing business with integrity,” UBS Chief Executive Sergio Ermotti said in a statement disclosing the extent of the wrongdoing, which took place over six years from 2005 to 2010.

=======
What could go wrong read this ex Moody paper
Is there really a lot of cash sitting idle or

Is ABS rated too high and banks continue to under-assess derivative exposure to ABS as central banks rely on ABS ratings in lending to banks.

“Rating agencies explicitly and publicly factor open-ended tax-payer assistance into ratings of insured-banks. In turn, the insured banks book more derivative trades than otherwise which almost ensure a fuure bail-out.”

http://www.sec.gov/comments/s7-18-11/s71811-33.pdf
http://www.sec.gov/comments/s7-18-11/s71811.shtml

#77 Huuk on 12.19.12 at 10:25 am

This is NOT a correction in the GTA for SFH.
This is seasonality at its finest.
Please Explain: Who Lists their house in December? Not people trying to maximize value, people that NEED to sell (death, job transition…). There is little to no inventory under $1 million for SFH in the 416.
The Spring will determine the correction, as Garth has been saying. What we see now is just the typical December sales in Toronto, nothing to write a blog post on.

Current listings were put on the market a month or two ago, not yesterday. A sales frop of 20% y/y is significant, especially coming after seven months of annual declines. It’s all about momentum and sentiment. — Garth

#78 Dupcheck on 12.19.12 at 10:26 am

I found a dead lady bug in the Herdez (Hot) Mexican salsa.
Apparently quality depends on the day it is made. Must have been made on a Friday at 5 pm.

Beats a live one. — Garth

#79 Tkid on 12.19.12 at 10:51 am

Blacksheep, you could find 7 conspiracies from 3 schoolkids buying ice creams from the ice cream van.

You want to know why all that garbage was breathlesslessly reported by journalists? Because the journalists have the ethics of a pack of rabid hyenas and cared little for accurate reporting.

They even had the mother as a kindergarten teacher, and did NOT wait for school records to be made available before reporting such. The brother has a very good basis for a lawsuit against the media.

I believe little about reports of someone being dragged out of the woods in the face of such poor reporting.

#80 Gunboat denier on 12.19.12 at 11:01 am

Regarding the stated $30K income. If you have your own incorporated company, you can also pay yourself more than what you actually make. Depending on circumstances, this can create a loss in the company and a shareholders loan for you. Obviously you pay more
taxes but this may be at a lower rate than high earning years in the future. So it can work both ways.

#81 Chickenlittle on 12.19.12 at 11:07 am

# 68 Mark

Ya that’s pretty typical for Hong-couver. Blame Toronto for everything even though they’re just as expensive, because, you know, Toronto is the centre of the universe, and whatever Toronto wants, Toronto gets. Ya ok whatever.

I see that they are getting snow and we are still waiting…..is southern Ontario the new California?

#82 Blacksheep on 12.19.12 at 11:11 am

Derek R # 61 & Inglorious Investor #14,

If the masses understood MMT and the fact a sovereign only ‘needs’ to collects tax to create demand for it’s currency, they would be very upset, especially when reviewing liabilities . Printing does have limits, but in the US $’s case, 40 + years dumping into the global pool and just now appears to be reaching a tipping point.

take care
Blacksheep

#83 refinow on 12.19.12 at 11:18 am

Garth i am a little confused about the 416.

With the addition of so many condo units, (Small Condo units) most under 700sq ft, are we not skewing the figures by introducing a multitude of lower priced properties being used to establish the average sale price of a SFD in the Toronto area?

These smaller units were not even being built, in previous years, and with so many projects under construction these near micro units, will bring down the average sale price.

Now don’t get me wrong, prices will drop, but comparing the month of December to the month of May in any year you will see a significant variance in volume.
Is over-exaggerating the drop.

Compare an Apple with an Apple.

Not an Apple with a Xmas Tree.

#84 refinow on 12.19.12 at 11:23 am

What will be game changing is the affects of the mortgage lending rules will have on the the lack luster spring market.

This will be the first undeniable crystal-clear proof that the Canadian Bubble has in fact popped.

#85 BPOE's BrainFart on 12.19.12 at 11:28 am

Hmmmmm, no smart azzed comments from BPOE in a while……
Is he in Debtors Prison?

#86 Herb on 12.19.12 at 11:28 am

Smoking Man,

Greater Fool may be named appropriately, but it is not about you. Stay with the program or kindly shut up.

#87 LaughingCon on 12.19.12 at 11:28 am

Re #78 Huuk

This is NOT a correction in the GTA for SFH.
This is seasonality at its finest.
Please Explain: Who Lists their house in December? Not people trying to maximize value, people that NEED to sell (death, job transition…). There is little to no inventory under $1 million for SFH in the 416.
The Spring will determine the correction, as Garth has been saying. What we see now is just the typical December sales in Toronto, nothing to write a blog post on.
===================================

Typical December you said?

These comparable typical December numbers are:
2006 – 2585 sales
2007 – 2868 sales
2008 – 1487 sales
2009 – 3079 sales
2010 – 2509 sales
2011 – 2699 sales
2012 – 2169 sales

SFH in 416 were only provided in the last three years:
2010 – 348 sales SFH in 416
2011 – 364 sales SFH in 416
2010 – 304 sales SFH in 416

yeah, this is seasonality at its finest!

#88 Sebee on 12.19.12 at 11:37 am

Garth, such big scary double digit numbers for Vancouvers, take it easy! Teranet has less scary single digit numbers, reported accurately down to 2 decimal places. Rounding up can be scary after all.

>
The Teranet figures released Wednesday show that prices in Vancouver were 1.35 per cent lower in November than a year ago, and fell 0.56 per cent from October. They are down 1.05 per cent so far this year.

Makes you wonder how massaged these numbers are if we’re reading here 12% down or more in Vancouver, yet Teranet shows 1.35% down.

#89 Mad Scientist on 12.19.12 at 11:39 am

As Garth had noted earlier – there won’t be a straight across the board fall – up here in awesome Barrie – I have seen homes listed and within 2/3 weeks it’s sold. I am hearing alot of talk of Toronto folks wanting to escape the big smoke and figure prices here (avg. SFH $348K) are a steal. IMHO, we will likely see flatline prices with moderate declines – I have seen outrageous gains the past 10 years – maybe we lucked out on buying when we did and where –

Home is shelter – investment is in the bank –

Within 48 hours (Mayan Calender offically ends) we could all be vapourized – yikes – to the World – it was a blast – Love Ya All!!

#90 Doug in London on 12.19.12 at 11:46 am

As I said before and will say again, all those people in Toronto area who are trying to sell now should have listed in late winter and spring of this year when listings were few, prices were high, and bidding wars were still going on. As the saying goes, make hay while the sun shines. Why don’t more people get such a ridiculously simple idea?

#91 hangfire on 12.19.12 at 11:56 am

#74…..ah Asse……your logic is somewhat covoluted….you may find that your ‘equity’ has all disappeared as values slump…..the last slump(s) lasted an average of 12 years a piece. Also…saying ‘cash is king’ is all very well and good…..but if you ‘hold’ real estate because it has ‘become your home’ then you have no ‘cash’ and you missed every other opportunity to profit while the majority of your ‘cash’ is tied up in non fungible real estate…..and essentially you are in the same boat as every other sucker. cash is only cash when it’s in your hand…..thats why the investment corps don’t count your ‘estimated appraisal’ of your ‘assets’ as net worth. And btw….theres so many flippers out there wearing kick me signs that it’s hilarious to watch. Any a-hole can get themselves into debt…..bottom line….when RE dies..it dies for a long time….called a business cycle. So called flippers holding RE right now are creaming their shorts. Hey…talk to any happy to hold builders lately…no?….thats because the COC loans are demand quality and they are losing money each and every month…….so much for optimism.

#92 The American on 12.19.12 at 12:02 pm

Canada is not on track to have a U.S. style housing correction. Canada is on track to have a trainwreck of mass proportions. A 17% reduction in GTA since May of 2012, a whopping six months, is insanity. The U.S. lost about double that value over a period of four years. At that rate, GTA could lose as much as the U.S. in a year. Or about 1/4 the time it took the U.S. to bottom. At that rate, I would venture to say Canada (yes, I understand these statistics are for GTA only, but considering GTA is the largest economy and city in all of Canada, it is a good benchmark to use as things to expect throughout the country) is due for a correction unlike anything else seen in the G20. It doesn’t take a f**king rocket scientist to have seen this coming years ago. DUH!

#93 Sebee on 12.19.12 at 12:10 pm

I’d like to walk you all through a lovely $1.1M home in Toronto if I may.

http://www.realtor.ca/propertyDetails.aspx?propertyId=12633046&PidKey=494961092

Now just look at that nice house. Just wonderful. 2 Garage door openers included.

What is overlooked in this lovely $1.1M home listing is the fact that it is exactly 2 blocks over from the Humber Sewage Processing plant – same side of the street. Anyone in that area knows that windows are rolled up and ventilation switched to recirculate as you drive through there. Time to sell is now as entire spring and summer that area smells like a used diaper storage bin. Hmmm, just imagine those lovely summer BBQs in the backyard of this new $1.1M home complete with a 300 day a year poop scent air freshner. You can’t even crack a window open, or come onto your porch for a morning coffee. All yours for $1.1M, garage door openers included.

#94 Grantmi on 12.19.12 at 12:15 pm

#79 Dupcheck on 12.19.12 at 10:26 am

I found a dead lady bug in the Herdez (Hot) Mexican salsa.
Apparently quality depends on the day it is made. Must have been made on a Friday at 5 pm.

Beats a live one. — Garth

yuuummmmmm.. protein…..

=(_8^(1)

#95 jess on 12.19.12 at 12:24 pm

EU first: Chinese workers rebuild Polish motorways
By Maja Czarnecka (AFP) – May 25, 2011
WISKITKI, Poland
The Chinese group says it can build a kilometre of motorway for 6.6 million euros, underbidding the price of its most expensive rival by nearly 200 percent.

COVEC management which includes collective dormitories with bunk beds, set up in an empty school the company has rented nearby. “The Chinese work day and night, 12 hours a day, seven days a week, and even during holidays,” said Krzysztof Lenarczyk, a Wiskitki town hall official in charge of infrastructure.”They started work in January (when public construction works are suspended in Poland) and they worked throughout the worst sub-zero weather,” he added.”The work is no longer as tough as it was,” said Xu Chengbing, a 38-year-old worker from the Anhui province in eastern China, who returned to the building site early in the morning after working a 12-hour night shift. He said he does not yet know exactly how much he will earn since the wages are sent directly to China. “We don’t get money in Poland,” he said as he munched on a rice pudding with Chinese jujube dates, part of a meal prepared by Chinese cooks in a garage re-fitted as a kitchen. “We don’t need it after all — we get both accommodation and food here,” he said.

=================

The European Commission is investigating why Poland’s government is refusing to pay dozens of foreign contractors for work carried out under a road-building program worth billions of euros and backed by Europe.
http://www.reuters.com/article/2012/12/19/us-poland-roads-idUSBRE8BI0VT20121219

#96 PERPLEXED on 12.19.12 at 12:39 pm

BLAH BLAH BLAH – 416 AND VAN CITY.

HELPS ME ZERO.

EDMONTON PLEASE.

CAPS LOCK WILL REMAIN ON UNTIL.

#97 DaveB on 12.19.12 at 12:40 pm

Mark Carney, the next head of the Bank of England, will be paid £250,000 in housing costs in addition to his salary and pension costs.

He will receive the money on top of his annual £480,000 salary and a yearly pension allowance of £144,000.

The housing allowance will be taxed at the new top rate of tax of 45%, which will be in place by the time he takes up his post next July,

Mr Carney is currently the head of the Bank of Canada.

A housing allowance was agreed as part of the package to tempt Mr Carney, who lives with his wife and four children, from his current post in Canada, but has only just been signed off by the non-executive directors of the Bank of England

http://www.bbc.co.uk/news/business-20782364

#98 Westernman on 12.19.12 at 12:43 pm

Paully @ # 36,
Well done! You demonstrated the true Canadian spirit… rat on someone trying to scrape by under the jackboot of the Canadian tax gulag. The Communists in the Soviet Union had a term for you – useful idiot.
Hopefully you will be scraping for change someday and some vermin like yourself will rat you out – that would be justice…

#99 Hoof-Hearted on 12.19.12 at 12:45 pm

.

Did you know that, for 7 months now, westside Vancouver houses have been dropping value at the rate of over $1,000 per day? – Updated

Monday, December 17, 2012

http://whispersfromtheedgeoftherainforest.blogspot.ca/2012/12/did-you-know-westside-vancouver-houses.html

#100 Jose' Martinez on 12.19.12 at 12:48 pm

#79 Dupcheck on 12.19.12 at 10:26 am

I found a dead lady bug in the Herdez (Hot) Mexican salsa.
Apparently quality depends on the day it is made. Must have been made on a Friday at 5 pm.

===================================

No we make those at 10 am on Mondays when all the Gringos arrive.

PS Wait till you see what we put in Guacamole dip !

#101 Devore on 12.19.12 at 12:54 pm

#52 Alex G.

Please don’t tell me that she considers this to be an “investment”.

Of course it’s an investment. If she just wanted a place to live, she’d have bought one of the thousands of resale condos on the market, instead of a piece of paper.

#102 renting and waiting no more on 12.19.12 at 1:03 pm

Advice or thoughts for the young man who wrote in? I’ve got a couple:

My thoughts: It sounds like your boss makes a lot of bad decisions – however it also sounds like you wish she’d make just *one* more of those before coming to her senses.
My advice: Be careful what you wish for.

#103 Dr. WAYNE on 12.19.12 at 1:14 pm

#2 JB on 12.18.12 at 10:14 pm

Oh what the hell… FIRST!
=========================

Oh what the hell … you’re an a$$hole BJ … uh, that’s JB.

AND … if anyone is a pharmacist on this blog, please contact SMOKING MAN and give him a year’s supply of
Valium … he may make some sense after taking a few.

#104 sherry on 12.19.12 at 1:21 pm

RBC recently made changes to it’s LTV policy. This is in response to a number of recommendation by OSFI. And the fact that more expensive home are less liquid, and the bank must compensate for this liquidity risk.

Effective October 15, 2012, the lending amount for conventional residential mortgages and RBC Homeline Plans, for all of Canada is subject to:

· loan to value tiering

· a maximum loan amount of $2,500,000.

Location
LTV Tiering

GVA
· 80% up to $1,250,000.00 and

· 50% of the balance

GTA
· 80% up to $1,000,000.00 and

· 50% of the balance

Alberta, Quebec, rest of Ontario and rest of B.C.

· 80% up to $750,000.00 and

· 50% of the balance

rest of Canada
· 80% up to $500,000.00 and

· 50% of the balance

Last edited by RBCSpecialist; Oct 23rd, 2012 at 12:16
can someone explain with exmaples….Thanks

#105 Quebec is Great on 12.19.12 at 1:49 pm

My main concerns are about the USD/CAD exchange rates and where they are headed. Found some good information here (mises.ca) about the effect of a housing downturn on currency values. (and it definitely worries me)

here’s a clip:
“When the Canadian housing bubble pops, the money supply in Canada will contract, as the banks contract; the value of the Canadian currency will surge because demand for the currency will be unchanged, while the supply is drastically reduced. This was observed during the financial crisis in the United States in 2008, as the value of the U.S. dollar was rising relative to other currencies. The general belief was that there was a flight to safety, but this belief is incorrect, the truth is there was a reduction in the supply of U.S. dollars resulting in a rise in its relative value.

This also helps explain why we have not seen significant inflation in the United States despite the Federal Reserve sharply expanding its balance sheet. The Federal Reserve simply replaced the money that the commercial banks had destroyed.”

so, for me the argument to move my business to the US (and how many others?) becomes more compelling..

#106 Living in AB on 12.19.12 at 1:50 pm

He Garth, just wondering if I’m out to lunch thinking its a big deal that $Value of total sales in November in Edmonton is down 44%, is this concerning?
The MLS dude (President) thinks its sweet that the avg price went up. I know if I was a President/ CEO of a company I’d be concerned if all of a sudden my total revenue just went down by 44% in one month (20% YTD).
Again, am I wrong on this?

#107 dontcallmeshirley on 12.19.12 at 2:01 pm

@ #13 LJ,

There’s another option. Inform the builder of the intention to not complete the transaction and forfeit deposits paid.

The builder could then re-sell the condo and pursue first a damage judgement, and then enforcement through garnishing or asset seizure.

Refer to the numerous unpaid alimony, child support and general damage claims for the builders probable success.

——————-
Advice? Your employer is stuck with an overpriced condo and has no choice but to complete the transaction.

#108 Mad Scientist on 12.19.12 at 2:05 pm

Okay – I secretly agree with Dr.Wayne – it gets very tiring when those post that they are first – it was funny the first 3,000 times – now it’s just plain stupid – Thanks Doc for writing what most of us are thinking -

#109 Vince on 12.19.12 at 2:06 pm

Re #72

Sorry Garth, didn’t see that you’d compared Dec 2012 to Dec 2011 later in the article–mea maxima culpa. That said, I combed your entry again, but still didn’t see the May 2011 figure (unless it was implied somewhere)…

I never suggested that the data, or any data, is irrelevant; I indicated that it would have carried _more_ relevance with the other reference figures from previous years for ready comparison.

As an aside, there is a good book out about Ivar Kreuger (Match King), and at one point it addresses the point that, in 1924 leading up to the crash there were a few key individuals raising alarm bells about a swelling in mortgage lending that was taking place, and advised that it would lead to dire consequences.

We know the story of how this ended (1929), and in a manner of history repeating itself, we’ve had a huge (never before seen even?) expansion of mortgage lending in Canada which based on history, has to unravel at some point.

Could very well occur in spring 2013. But as always with prognostications, you can forecast price or time — but rarely, if ever, both.

#110 Sebee on 12.19.12 at 2:09 pm

I always love listings like this. I mean what could possibly be wrong with 2 nearly identical houses next to each other being priced $650K apart – one costing nearly half of the other. it’s just all a greaterfool game.

http://www.realtor.ca/propertyDetails.aspx?propertyId=12589688&PidKey=799436380

http://www.realtor.ca/propertyDetails.aspx?propertyId=12593197&PidKey=759664868

#111 Devore on 12.19.12 at 2:19 pm

#94 Sebee

But there 100 potlights, and those alone are worth at least $1000 each.

I feel like I’m reading a foreign language when I look at that listing, able to only pick out a word here and there. Is that what a million bucks buys you these days? A dollar sure isn’t worth what it used to be.

#112 Seriously? on 12.19.12 at 2:28 pm

The exxxxtreme inflation of housing is the biggest “Con” job in Kanadian history.

Brought to you by your friendly neighbourhood “ReCon”.

Stevo wasn’t kidding when he said “when I’m done with “Con”ada, you won’t recognize it!”.

Beat the rush, buy your shipping “Con”tainer now.

If you are a “ReCon” and if you think that Stevo is even slightly “Con”cerned about you, then you are dis”Con”nected from reality.

Seriously

#113 Ralph Cramdown on 12.19.12 at 2:35 pm

#21 Ryan Tynd — What gets you 7%?

Torstar, yesterday. But not today.

#114 Sparky55 on 12.19.12 at 2:42 pm

With the new OSFI changes that happened at the end of October, do pre-approvals still have 3 months from that date? If so, it will get interesting in January, when this time runs out!

#115 Old Man on 12.19.12 at 2:55 pm

The holiday period sends me into a panic mode as am always short of cash on hand with mega bills coming my way. So sold a few securities today with RBC to get some green into my bank account with a transfer. I wish you all a Merry Christmas, as on the 26th am heading for Vegas, and booked into the Excalibur, and wish Smoking Man could come, as have a few hot gals in waiting that would love to meet him. Tomorrow will be rushing around to bring all my bills up to date, as there are many that need to be covered, I might be cash poor at times, but will take care of it all.

#116 coastal on 12.19.12 at 3:03 pm

“Just saw Cameron Muir on Global Vancouver. Apparently the mortgage rules were primarily implemented to help fix the excesses of Toronto and they’ve only served to hurt Vancouver in the process.

How does a person like that sleep at night?”

Mark,

I’m sure Cam has a full prescription for Ambien, he is looking a little haggard these days. But wouldn’t you be after having to dole out that bullshit day after day that astronomical prices have no reason to ever go down ? Deb on GlobalBC is acting like it’s some astonishing act of God that the glow of HAM and easy credit would ever end. The woman speaks to us like we’re in frigging kindergarten and needs to hang up the mike.

#117 Blacksheep on 12.19.12 at 3:04 pm

REMOVED BY REQUEST

#118 Inglorious Investor on 12.19.12 at 3:13 pm

On the heels of Michigan becoming a ‘Right to Work’ state, GM decides to drive the Camaro from Oshawa to Michigan. Coincidence?

Remember when Caterpillar decided to leave London and crawl to Indiana after that state changed its union laws?

#119 Asse on 12.19.12 at 3:14 pm

#92 Hangfire….
Basement rental goes long way to paying for mortgage, and is cash. Value of bungalows in good school districts may probably be affected, but not as much as other areas.
Stoufville, Milton, Brantford and other bedroom communities will be repriced accordingly, especially if there is a gas hike.
Our mtge would be less but we are capped until this coming March.
Funny, I remember Garth 10 years ago advising buyers to buy property in TO.
If and when interest rates move having a good downpayment is vital for first time buyers. There were some incredible deals in 91 but interest rates were over 10%. If the bond market goes fritzy (ie Greece finally goes belly up) which may happen after the Germany elections then you still won’t be able to buy.
Be ready for opportunities, cash is king!

Merry Christmas Doomers!

#120 broadway skytrain on 12.19.12 at 3:20 pm

As old man winter comes to visit vancouver the long and dark days are breeding a new darkness, aside from nearly paralyzing the city with a couple inches of white slurpee.
All of a sudden we seem to have ‘enough’ condos and the burning need to grab one fast has given way to a widespread realization that maybe now isn’t “the best time to buy”. Weaker prices will come, but to a degree. No mass exodus of Shaunessians? and Kitsaloaners to Red Deer, Regina or Comox, but I would not want to be selling a condo anytime soon.

Sure is fun to watch, though. Many thx to GT for our daily fix!
——————
off topic, if i may, i’m looking for any deep powder fiends as my ski partner became unavailable.any vcr ski/riders interested for wed-fri of this week to indulge in the excessive new snow :) , i got 4×4 to get up cypress.

#121 Smoking Man on 12.19.12 at 3:33 pm

#117 Black Sheep

Anything is possible thanks for the clip.

Hum???????

#122 Old Man on 12.19.12 at 3:35 pm

#117 Blacksheep – have news for you as get the Intell if you know what I mean as have it all in spades, as there was no conspiracy, and you got it all wrong as there were 3 to 4 shooters on the scene. I have my sources, and what can I say :) My videos must be blown up to a full screen to see what came down; perhaps should send this all to Garth, but he does not believe in a conspiracy or he might lol.

#123 Sebee on 12.19.12 at 3:42 pm

#111 Devore

>But there 100 potlights, and those alone are worth at least $1000 each.

Wow, you’re right. I missed that. Amazing. Only Jagger is used to having that many pot lights on him at once. Wonder if 100 potlights is enough to kill off the smell of 3 elephants taking a dump in your living room?

#124 Patiently Waiting on 12.19.12 at 3:47 pm

#105sherry on 12.19.12 at 1:21 pm

RBC recently made changes to it’s LTV policy. This is in response to a number of recommendation by OSFI. And the fact that more expensive home are less liquid, and the bank must compensate for this liquidity risk.

Effective October 15, 2012, the lending amount for conventional residential mortgages and RBC Homeline Plans, for all of Canada is subject to:

· loan to value tiering

· a maximum loan amount of $2,500,000.

Location
LTV Tiering

GVA
· 80% up to $1,250,000.00 and

· 50% of the balance

GTA
· 80% up to $1,000,000.00 and

· 50% of the balance

Alberta, Quebec, rest of Ontario and rest of B.C.

· 80% up to $750,000.00 and

· 50% of the balance

rest of Canada
· 80% up to $500,000.00 and

· 50% of the balance

Last edited by RBCSpecialist; Oct 23rd, 2012 at 12:16
can someone explain with exmaples….Thanks
===================================

Also, how would these new LTV rules apply to someone that has say a $1.5 million mortgage on a house worth say $1,800,000? There are a lot of people in this type of situation in Greater Vancouver area … is there a grandfathering of the new rules so that they do not apply for people in this type of situation?

pw

#125 Bottoms_Up on 12.19.12 at 4:49 pm

#117 Blacksheep on 12.19.12 at 3:04 pm
———————————————-
So the shooter had a buddy that travelled to the school with him. That doesn’t mean anything, other than the fact that the shooter was accompanied by someone else.

Wrong blog, boys. — Garth

#126 Dr. WAYNE on 12.19.12 at 4:59 pm

#108 Mad Scientist on 12.19.12 at 2:05 pm

Okay – I secretly agree with Dr.Wayne

===========================

So … I do have ‘one’ supporter … nice to see I’m not the only one … so now it’s ‘two’ … jeeezzz, an exponential climb.

#127 Uwinsome on 12.19.12 at 5:10 pm

No housing boom coming to the USA anytime soon, according to Robert Shiller:

http://www.cnbc.com/id/100328404

What’s between a bust and a boom? A recovery. What media crap. — Garth

#128 smartalox on 12.19.12 at 5:16 pm

@ #100 house hearted:

That link is awesome.

Home prices dropping by $1000 a day?

Now THAT’s a headline! Too bad the MSM that ran with the grossly erroneous headline “$Million dollar average house price in Vancouver” in spring of 2010 won’t apply the same level of rigorous analysis and run away with this calculation as well.

#129 Trevor P on 12.19.12 at 5:26 pm

http://www.calgaryherald.com/news/alberta/Cabinet+ministers+will+have+make+tough+choices+Alta+finance/7721925/story.html

The Alberta fiscal picture is not as rosy as many portray as the government has really been overly optimistic with the revenue stream from royalties with respect to the oilsands vs the reality of market pricing. The heavy crude is trading at a $37 discount to the current $87/bbl west Texas crude price.

There is again talk of dipping into the “sustainability” fund…wasn’t that previously called the “heritage fund” and was it not intended to be invested for the long term benefit of all Albertans…(or is this a different fund??)
Either way…not a good sign for “Canada’s Economic driver”

Current economics of the oilsands must be questionable…lots of individual projects betting on higher long term prices without firm solutions in place for moving higher volumes of oilsands production to market…

Those betting on higher housing prices in the spring in Alberta because the economy is so “strong” may have plausible reasons to consider other outcomes…

tp

#130 Mike on 12.19.12 at 5:32 pm

REMOVED BY REQUEST

#131 Westernman on 12.19.12 at 5:41 pm

Inglorious Invester @ # 118,
No coincidence, chump – money goes where it is treated best…do you blame it? Canada better wake up quick and get it through it’s thick skull or we’ll all be trying to make a living selling garage sale shit to each other…

#132 Fartweezel on 12.19.12 at 5:43 pm

Good read but the comments really made it!

Nostradamus excelled today as did pretty much everyone else.

#133 Sebee on 12.19.12 at 6:23 pm

#111 Devore

Whoever buys that $1.1M house will never have to buy eau de toilet ever again . (I mean toilet, not toilette).

Whoever buys that $1.1M house will never have to ask who farted.

Whoever buys that $1.1M house will have one happy wife – as she in turn will be able to fart under cover. (Come on, everyone knows women fart only when the men are asleep)

Sorry I couldn’t help myself. I think I got it out of my system now. Perhaps you would find it funnier if you ever drove by the Ontario Food Terminal are in the summer time and taken a whiff youself obviously has an idea of what this proud owner of a $1.1M home will endure year round.

#134 Sebee on 12.19.12 at 6:26 pm

Sorry….I was laughing so hard at the end of my previous post it went all Smoking Man illegible from type-os.

Ahhh…100 potlights next to a sewage processing plant. It’s a bit like putting a giant aero racing kit on a Kia, isn’t it?

#135 Uwinsome on 12.19.12 at 6:42 pm

“What’s between a bust and a boom? A recovery. What media crap.” — Garth

Gee Garth, you like to quote Mr. Shiller whe he supports your theories. But when he doesn’t – it’s crap hmmm?

Shiller’s fine. The report is juvenile. Media crap. — Garth

#136 jess on 12.19.12 at 6:43 pm

smoking man might like to read this

IQ tests are ‘meaningless and too simplistic’ claim researchersResearchers say findings are a ‘wake up call’ for anyone using current tests
Comes after biggest ever study of intelligence

Well i hope they get rid of that outside testing waste of money and put in the classroom instead of the hands of testing agencies

university of western
IQ tests are ‘meaningless and too simplistic’ claim researchers
Researchers say findings are a ‘wake up call’ for anyone using current tests
Comes after biggest ever study of intelligence
By Nicholas Mcdermott
PUBLISHED: ::: GMT, December 12 | UPDATED: ::: GMT, December 12
Read more: http://www.dailymail.co.uk/sciencetech/article-50681///IQ-tests-meaningless-simplistic-claim-researchers.htmliixzzFFXWiaeVE

The new study, published in the journal Neuron, suggests that intelligence is too complex to be represented by a single number.
Study leader Dr Adrian Owen, a British neuroscientists based at Western University in Canada, said an ‘astonishing’ number of people had contributed to the research.
‘We expected a few hundred responses, but thousands and thousands of people took part, including people of all ages, cultures and creeds and from every corner of the world,’ he said.
‘When you take 100,000 people and tested their brain function, we couldn’t find any evidence for a single uniform concept of intelligence.

#137 Derek R on 12.19.12 at 7:04 pm

#136 jess on 12.19.12 at 6:43 pm wrote:
The new study, published in the journal Neuron, suggests that intelligence is too complex to be represented by a single number.

In fact it went further and suggested that you might need three or more numbers.

But those can be combined to make a single one.

So instead of having an IQ of 120 or 98 or whatever you might have an IQ of 93.120.102 or of 140.98.110 or whatever.whatever.whatever which looks a bit more complicated than the 20th century IQ but not really that much different.

#138 Canadian Watchdog on 12.19.12 at 7:07 pm

The only reason why GTA’s average price is going up is because lower end sales are declining faster then high end sales. Chart When the average price is calculated (total dollar volume divided by sales), more dollar volume from high end sales gets averaged into less properties sold, therefore it boosts the average price number. Read post #121 for explanation of GTA’s average price.

Don’t expect major price declines until price changes and sales volume increases. This should begin in Q1 going into Q2 2013.

#139 Old Man on 12.19.12 at 7:10 pm

Smoking Man needs an adjustment in life and to ride the fast train with me, so I can teach him the ropes in Vegas, but he is a married man who will never cross the line with a wife. Oh well, what can I say, as will have a blast on the 26th for 5 days, and he will have no action whatsoever.

#140 bill on 12.19.12 at 7:14 pm

#99 Westernman on 12.19.12 at 12:43 pm
and you would be the useless idiot ,of course.

#141 45north on 12.19.12 at 7:18 pm

Hoof-hearted: from your link: The unwinding of a bubble takes a long time to play out. In the United States things started to drop in late 2005/early 2006, but the collapse of the housing market really didn’t enter our consciousness until 2008.

I’m thinking that in Canada the collapse is not going to take 5 years. Here’s my plan: the government gives everyone who is foreclosed $1000/month for a year. He has to apply, the bank has to say that it did foreclose. The bank takes over the municipal taxes and maintenance. CMHC pays the banks for the loss.

#142 Sebee on 12.19.12 at 7:21 pm

Hey Devore, check out the garage retrofited with a living room and bathroom next to that $1.1m crib.

#143 Canadian Watchdog on 12.19.12 at 7:37 pm

Just to add to post #138: This diagram should help visualize how average prices move with seasonality. Diagram

#144 Westernman on 12.19.12 at 7:39 pm

bill @ # 140,
Another trenchant remark by a jealous lesser intellect…

#145 Victor V on 12.19.12 at 7:40 pm

National home prices cool in November

http://www.theglobeandmail.com/report-on-business/economy/housing/national-home-prices-cool-in-november/article6553139/

#146 Smoking Man on 12.19.12 at 7:46 pm

#127 UWinsome.

I agree with you, first thing non zillionaire do when looking for a house is the look for a mortgage.

From google trends.

http://www.google.ca/trends/explore#q=Mortgage&geo=US

Sorry Garth

#147 Nostradamus Le Mad Vlad on 12.19.12 at 7:56 pm

-
Exc. posts today.

Blacksheep and tkid, found a couple of links which add clout to what you were talking about (not going to post here). If you like, I’ll send them to you.
*
Rumor only Please don’t read. The BdB’s are back in town; Money Laundering positions available. Apply at HSBC; Obomba not prosecuting Wall St. Nice chart; McDonald’s What’s wrong with it? 2:37 clip How banks lease their gold; Stop Press! Martha Stewart’s empire, like the USSR, is crumbling; 75% Interesting article; The Marshall Plan Birth of the communist EU; Japan Undoubtedly, this will stir the pot up again.Emigrating But to where?
*
Why the NWO hates Syria “No Rothschild central bank, NO IMF debt, No Genetically modified food, Oil and pipelines, Anti-secret societies, Anti-Zionism, Secularism, Nationalism.” Good summing up; In light of the Newton shootings, here are the stats for drones; War is War So prosecute and impeach already, such as here; 4:43 clip Harry Reid is a hypocrite; Creationism vs. Evolution Creationism comes first, but once something is created, it cannot be uncreated so evolution takes over; Freezing to Death -50C temps. Coldest winter in decades in Russia; Another civil war in the MEast, created by the west; Five new planets orbiting a star, so let’s put all the warmongers here on the star there; UK military headed to Gulf; Jimmy Savile It’s a good job he died overa year ago, otherwise he would have been lynched by now; 7:42 clip Hope and Change with Obomba and FEMA? You bet yer ass! Turmeric Not only a good food additive; Obomba and Biden Two first-class hypocrites; 6:34 clip America is a looneybin. So is Canada, so is the west.

#148 45north on 12.19.12 at 8:43 pm

Patiently waiting: how would these new LTV rules apply to someone that has say a $1.5 million mortgage on a house worth say $1,800,000?

well the owner has to come up with $250,000

under my plan he would get $1000/month for a year – if the bank foreclosed

or door number 2: here is the intro:

“we think the government should help Canadian families to stay in their homes. we are talking about families who have worked hard their whole lives and have played by the rules.”

#149 jonnyk on 12.19.12 at 8:58 pm

Hey Intersting Times, where did you come up with the stat/info that proves your statement below????

“over 70% of mortgages in Canada are 5% or 0 down CHMC mortgages. “

#150 Steven Rowlandson on 12.19.12 at 9:09 pm

If you bought a detached house in 416 on, say, May 14th, you paid $835,522. That was the average, and that month 10,850 properties changed hands in godless Toronto. If you bought a SFH last week, you paid $694,619 – the current average. And we’re on track to see about 3,700 sales this month.

Garth what working man in canada would do a stupid thing like that?

#151 cynically on 12.19.12 at 9:52 pm

The answer to your RE question Garth, is it won’t happen as is the answer to your Senate appointment, unless you’re a party hack and with your not too distant government experience I’m sure you’re not. However if you want a seat in that undemocratic institution I suggest you start a movement for democratic change and with your present blog you might have made enough believers in your abilities to support you but hey, this is Canada where nothing ever changes, much less parliamentary governance, so not worth the effort. Stay where you are exposing those realturds, as someone on the blog so aptly called them.

#152 JuliaS on 12.19.12 at 9:57 pm

#137 Derek R

As far as I remember, IQ test was invented to detect mental retardation in fresh military recruits and shell-shocked veterans. It was an “are you too dumb to serve” test. Now we apply it to everyone.

#153 Herb on 12.19.12 at 10:20 pm

#143 Canadian Watchdog,

I look forward to the graph that will show those movements in 2013.

#154 OOO on 12.19.12 at 11:25 pm

Humph

#155 new canadian on 12.20.12 at 3:49 am

#94 Sebee
Isn’t it cool to have 2 openers for a single car garage? Like you come home from work with your Ferrari and you wanna attract some rich chicks(banker children) and you want to drive your Veyron which is parked in garage next to your smelly garbage bin.
So instead of dealing with hassle of taking one garage opener, you just leave it in Ferrari and conveniently use second one.
P.S Veyron is not a new Kia model for 2013.

#156 Sebee on 12.20.12 at 11:06 am

#155 new canadian

If you know the area, you know there is a used luxury car dealer next door. If you have more money than brains to dump $1.1M into this $400K home at best, your Veyron will probably be repoed and sold off next door to your house.

Another option, you can always buy the garage posing as a house next to your new $1.1M home for your Veyron.

#157 live within your means on 12.20.12 at 6:45 pm

The other day I mentioned Twisted Radio – hilarious. They change all the words of different Christmas carols. – Hilarious – look up Bob Rivers on youtube. More than we have on aCD.