The soft landing

softlanding

When government announces something on the Friday before Christmas, it’s a safe bet they hope nobody notices. Few did. So you probably didn’t hear that Ottawa – shortly after trying to blow up the housing market and choke off new mortgage borrowing – may be relenting. Or at least starting.

For the last few months realtors and builders, developers and lenders have been bombarding MPs and the munchkin minister known as F to throttle back on the market-murdering actions taken last summer. Real estate boards have been shocked to see sales in almost all major markets dive in the period since 30-year mortgages were snuffed, cash-back loans outlawed and CHMC insurance throttled back.

Across Canada resales have dipped below year-ago sales levels for eight consecutive months. New home construction has tanked, and everywhere new project financing is drying up. Mortgage broker ranks have thinned dramatically, and suddenly it seems letting residential real estate suck up a third of the national economy was, er, a bad idea. At least if you’re going to purposefully deflate it.

So what’s this?

While making a big deal of capping CMHC mortgage insurance as it nears $600 billion – theoretically putting the brakes on high-ratio, high-risk 5%-down deals – F has now thrown a new $50 billion into the marketplace, but this time to the private sector. Companies like Genworth have just received a massive 20% hike in their allowable coverage, which means the federal government will guarantee $300 billion worth of that company’s debt, up from $250 billion.

In fact so quiet was this announcement, it wasn’t announced at all. Genworth revealed F’s little Yuletide yummy in a media release that helped its stock soar last week, jumping 3% in a single day. And why not? It’s a gift. New legislation about to take effect lets Genworth provide bulk insurance coverage at the same time CMHC is being pushed out of that market. It also allows Genworth to take money previously earmarked for a guarantee fund and use it, presumably for more high-ratio lending.

Already taxpayers are on the hook for over half the $1.2 trillion in residential mortgages outstanding in Canada. It’s been this ocean of money which banks can hand out without risk – knowing any default will be covered by fed-backed insurance – which helped push prices skyward. Should the housing market stall and crash back to earth, Ottawa would suddenly have a liability the size of the entire national debt to deal with.

Of course, F says this will never happen.

“The housing market has softened somewhat in part because of steps that I’ve taken and I’m happy about that. Less demand, lower prices, modestly, in the housing market are much better for Canadians than a boom followed by a bust. So I’m all for a soft landing.”

Is the Genworth deal an admission real estate’s actually crumbling faster than the peckerettes expected? If this all-important Spring market stagnates into a swamp of listings with weak buyer demand and plunging prices, will it backfire on the whole economy? Is F losing his nerve in the face of rapidly-deteriorating sales numbers, a 30% dive in Vancouver and a condo implosion in the GTA? Have the realtors’ furious behind-the-scenes lobbying efforts worked? But is it too late?

Well, soon we’ll know. In Toronto and Vancouver the spring market begins in less than thirty days. Meanwhile the meme of a sick market spreads. For example, “Trump Tower Woes signal Top of Toronto Condo Market,” was the headline Bloomberg stuck on the top of its story detailed the plight of investors suing to get out of Canada’s tallest residential building. And the Globe and Mail days ago broke ground with this: “Shaky foundations: How Ottawa’s computers get Canadian home prices wrong,” showing billions in mortgage loans may have been made on sloppy appraisals. Or this.

This year brought the frothiest, weirdest, most delusional moments in Canadian real estate history. They were followed by hasty and dramatic restrictions which changed rules overnight. And 2012 ends in a funk market, realtor panic and policy disarray.

Six years ago F gave us 40-year mortgages and zero down. Four years ago the amount of government mortgage insurance was doubled. Three years ago came the cheapest mortgage rates in history. In between were new tax credits for first-time buyers and free money for renovations – all designed to goose housing. Then he pulled back hard last summer, sending the market into a dive. Now, desperate, he lays on more gas.

Soft landing? Stand back.

161 comments ↓

#1 Kevin on 12.26.12 at 5:33 pm

Like my grandfather used to say, you burn you ass, you sit on the blister…

#2 think again on 12.26.12 at 5:44 pm

“Stupid is as stupid does…”

#3 futureexpatriate on 12.26.12 at 5:49 pm

Isn’t another word for a soft landing “splat”?

#4 Lisa on 12.26.12 at 6:01 pm

Just what we need more people qualifying for mortgages that they can’t afford.This is just going to prolong the wait for the inevitable total crash of the housing market.

#5 drydock on 12.26.12 at 6:16 pm

You can’t spend more than you make.
You can’t spend your way out of debt with borrowed money.
A day of reckoning is coming.

“If you ignore reality, you can’t ignore the consequences of ignoring reality”

Ayn Rand.

#6 Spiltbongwater on 12.26.12 at 6:18 pm

Can the U.S. make a workable fiscal cliff game similar to this one?

http://www.youtube.com/watch?v=YHv5jgXz9I8

#7 Whitey on 12.26.12 at 6:18 pm

Merry Christmas Garth…thanks for the great blog

#8 happy renter on 12.26.12 at 6:20 pm

New houseing developents in Victoria are doing well.People are snapping up new affordable houses under $425,000 like crazy.
The city of Langford is giving new houses for under $180,000 for low income families making under $65,000 a year.So move your family to Langford and work at Wal Mart so your family can have a new house.

#9 mel in victoria on 12.26.12 at 6:26 pm

..I think Flaherty just blinked….

#10 waiting on 12.26.12 at 6:27 pm

i have been watching mls like a hawk for 20+ months and been through 100 houses.sfh in gta are not coming down !!!!!!! makes no sense ,if it doesnt sell in 3 months its relisted 5days later for 10000 more

#11 luke8929 on 12.26.12 at 6:32 pm

Bailed out the banks now he is bailing out the insurance industry, end of the world if we don’t for sure, timexes kia’s and faux fur instead of rolexes, beemers and mink, by god the horror.

Is to cover existing liabilities or to increase the future amount they can cover? They must be on the hook for a bundle if Canadians are defaulting, can’t have your financial contributors on the hook for their greed. I hope it starts another round of frenzied buying with 1 million $ shacks selling for 4 or 5, great stuff.

There are no adults, they will not stop until you get sovereign defaults or loss of confidence in the currency. Japan, tiny timmie in the US, all removing any debt ceiling limitations, no stopping it, the doomers know one thing, greed and stupidity are the new must have personality traits, its all the rage everywhere.

#12 drydock on 12.26.12 at 6:32 pm

On a lighter note in the “Final Thoughts” #123 of a few days back i linked to the video which is guaranteed to change you forever.
Below is a link explaining how the computer scientists at Internet Corp. stumbled upon this mind altering technique of mystical enlightenment.

http://www.youtube.com/watch?feature=player_detailpage&v=YNz8aOtY6Xo

#13 DogWalker on 12.26.12 at 6:38 pm

Blink or not, bubbles do not deflate slowly, they pop. The damage is already done. Just a hint that prices will not go up for ever is enough to spook most people considering the closing costs. The only thing that has been driving the market the last few years was the “buy now or be priced out forever” mantra. We shall see..

#14 Astute Poverty on 12.26.12 at 6:39 pm

t’is all over cept the cryin’ Just sit and watch an episode of Honey Bo Bo and there’s no doubt that 98% of our DNA is like a chimpanzee. We might as well evolve back into primates at the rate we’re going. Merry Flying Spaghetti Monster-Mas

#15 kreditanstalt on 12.26.12 at 6:46 pm

Nice of them to spend another $50B of our money to prop up a company whose business model is utterly dependent on government manipulation of interest rates in the first place…

We’ll pay, either through higher taxes or through higher prices.

#16 Mark on 12.26.12 at 6:52 pm

The extra limit room for Genworth won’t do them any good once everyone realizes they’re severely undercapitalized relative to the risks they take. History has generally shown that most government loan guarantees granted tend to be exercised and payable by the government.

#17 Canadian Watchdog on 12.26.12 at 6:59 pm

Genworth revealed F’s little Yuletide yummy in a media release that helped its stock soar last week, jumping 3% in a single day.

Too bad high-frequency algos can't read forward guidance cause this was old news. Genworth Q2 MD&A

#18 Pr on 12.26.12 at 7:13 pm

the federal government ( Means you and me!) will guarantee $300 billion worth of that company’s debt, up from $250 billion.

Its a complete disgrace! Please stop this guy (F)

At one point we have to say : No, Its enough!

And if you think it does not concern you, you are terribly wrong, because, if or when, the cmhc and Genworth goes bust, the gouvernement will send you new taxes to pay the bill of those entity.

#19 TnT on 12.26.12 at 7:13 pm

Garth

Is this post outlining an unexpected event that could result in some humble pie on you end?

Can there ever be an orchestrated “soft landing” for the 416?

Stay tuned….

#20 Nodebt on 12.26.12 at 7:16 pm

Merry Christmas Garth ! I enjoy reading your posts everyday! Thanks

#21 The soft landing — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate « The Affluent Boomer™ on 12.26.12 at 7:24 pm

[...] via The soft landing — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estat…. [...]

#22 LJ on 12.26.12 at 7:35 pm

Looks like we can all look forward to higher taxes soon due to those loans being shoved back onto the government books when they start to go bad. Never mind that F will never be able to dig his way out of deficit spending.

On the bright side, at least the poor underwater homeowners will only have to deal with the government, for both their tax burdens and their debt payments, when they try to declare bankruptcy. Can you say “payroll garnishment?”

#23 45north on 12.26.12 at 7:44 pm

Flaherty has now thrown a new $50 billion into the marketplace, but this time to the private sector.

Genworth can refuse mortgages from Brampton but CMHC cannot. Big difference. The decline in house prices will not be symmetrical – sought-after areas will go up while vast tracts of the GTA go down. Increasing the limit on private mortgage insurance will accentuate the difference.

#24 Ret on 12.26.12 at 8:06 pm

If we keep our fingers crossed and bring in another couple of hundred thousand immigrants into Van and T.O. next year, we can sop up that condo oversupply in six months. Kenney’s cool with that. He can slid’em in as techno/skilled. See, no problemo!

The banks are okay with Genworth too, once they found out that F was on board and solid with the new backer.

Damn the torpedoes, hit the gas. Party on Canada!

#25 Junius on 12.26.12 at 8:15 pm

#16 TRT,

You said,”On another note, was at a holiday party and the issue of basements suites came up. All the homeowners agreed that they should push rents up….reasoning was inflation and that Vancouver rents are much higher.”

Vancouver rents have been stagnant for a long time. Your friends are going to find themselves with no one willing to pay these prices. A simple Craiglist search will show you that there are thousands of rental units available for the same prices and sometime less than a few years ago.

Rental prices are more reflective of the real economy which continues to sputter in Vancouver. They do not rise with wishful thinking alone.

#26 kreditanstalt on 12.26.12 at 8:29 pm

There seems something terribly, unsustainably wrong about a system in which people have to borrow to “buy” a house, can only do so at increasingly low interest rates and can only do so with the rest of us constantly forced to bail them out.

With so many businesses’ success or failure – and so many “JOBS” – dependent on government being able to continue ‘rate-manipulation-via-deficit-spending’, you have to ask yourself if this is really any more than a Ponzi scheme…

I may be naive or just plain DUM, which is why I bet on gold and against this system. But if fundmentals are ever again to mean ANYTHING, this must blow up sometime…

#27 Proud Musty Basement Dweller on 12.26.12 at 8:32 pm

geez.. F… F ‘in Bozo!! It would be funny if it didn’t mean that eventually I as a taxpayer will be on the hook for baristas borrowing and buying houses.

#28 Canadian Watchdog on 12.26.12 at 8:56 pm

As of Q3, taxpayers are now on the hook for an estimated $800-$825B of insured mortgages.

Genworth’s insurance-in-force (IIF) stands at $295B and CMHC is $576B, however, from my understanding as of recent information, Genworth’s IFF is based on original principal and CMHC is current principle. My best estimation for Genworth’s current principal IIF is between $225-250B.

As noted before, there will never be a technical limit breach because doing so would look irresponsible on F’s side. The latest increase was to allow fundamental demand to continue with no disruption. That is all.

#29 T.O. Bubble Boy on 12.26.12 at 9:07 pm

“10 Best Homes” from the Toronto Life House of the Week section:

http://www.torontolife.com/daily/informer/gimme-shelter/2012/12/26/year-in-review-2012-houses/?utm_source%3Drss%26utm_medium%3Drss%26utm_campaign%3Dyear-in-review-2012-houses

Most of these places have sold and/or delisted… but the Versailles palace-inspired Post Rd place can still be your’s for just $14M.
http://www.realtor.ca/propertyDetails.aspx?propertyId=12228747&PidKey=2028392574

#30 a prairie dawg on 12.26.12 at 9:10 pm

On the gas. Off the gas. On the gas again. Can he even see over the wheel? Maybe a cushion would help.

#31 juno on 12.26.12 at 9:21 pm

50 Billion will be burnt in 3/4 months then its going to be an infinite stream of bail outs after that.

Too big to fail?

F and C only has one formula, dump more cash into the system. Canada Needs a Serious Downgrade. This government is clueless.

#32 Freedom First on 12.26.12 at 9:41 pm

Soft landing? …….is that like when a teen-aged girl tells her boyfriend that she is just a little bit pregnant?

#33 Thoughtful observer on 12.26.12 at 9:49 pm

Stephen was quiet and pensive as he looked out of the evening window in the prime minister’s office. His government’s economic narrative was springing leaks.

The incoming new US Secretary of State John Kerry was opposed to the Keystone pipeline. ‘Why the long face’ Stephen had kidded him the last time they met. Shoot, hope John hadn’t take that little joke personally; Barack had thought it was hilarious.

The Northern Gateway pipeline, so essential to obtaining an international price for Alberta’s oil, was being blocked by the leftie airheads in BC. So much for increased royalties there.

The housing market was another worry. That little focker F had promised that it would all work out — but a collapsing housing market would effectively double the national debt via a CMHC meltdown. Yikes!

Stephen reached behind him. As he idly scratched his doctor wayne, his face grew thoughtful. What the f to do now?, he thought, grimacing at the unintended pun.

Speaking of F, there he was sitting off to one side of his desk with his nose in a tall Scotch and water. F was starting to lose his nerve and was drinking heavily these days. Poor little bastard, thought Stephen, F was doing his level best but the national economy was far more complex than Ontario’s ever was.

‘If only I hadn’t lectured those damn Europeans’, he reflected as he replaced his hands on the heavy oak window casing. France was now showing worrisome economic signs, much like Quebec, with a spending problem and too many pudgy bureaucrats on the payroll.

Oh well, as least he had pulled the troops out of that hole called Afghanistan. But now that over-rated little shit Justin Trudeau was flanking him on the left by sucking up to the Muslims.

‘What a friggin’ job, he thought wearily as he began to prepare for the next tiresome year-end media interview …

#34 OkanaganInvestor on 12.26.12 at 9:59 pm

For those tired of looking at dogs, here is the “Best of Garth” before the Amazons got to him:

http://www.greaterfool.ca/2011/11/03/the-uncrisis

http://www.greaterfool.ca/2012/01/17/basis-instinct/

http://www.greaterfool.ca/2011/02/06/accident-waiting-to-happen/

I challenge any dog to top this trio!

#35 TnT on 12.26.12 at 10:01 pm

There’s plenty of tools and magic to keep this housing market floating and I am confident F and C will NOT have this sink on their watch…… Soft Landing over 4 years is an easy target….

#36 Seven Stars and Orion on 12.26.12 at 10:02 pm

Thanks for your tireless fight to help folks Garth. Lost causes are the only causes worth fighting for.

I’m apparently good at it. — Garth

#37 FTP - First Time Poster on 12.26.12 at 10:02 pm

Here is all the reasons you need not to invest in the US housing market. A timely and succinct summary of what is going on in the US & EU.

http://www.zerohedge.com/news/2012-12-26/canadian-summarizes-americas-collapse-everyone-takes-nobody-makes-money-free-and-mon

Have things gotten better or worse since this speech 8 months ago?

#38 Mr Buyer on 12.26.12 at 10:03 pm

I am guessing that the damage may be done to the psyche of the nation but we will see very soon for sure. This does nothing but at best add a few more moments to the bubble but I doubt it.

#39 Canadian Watchdog on 12.26.12 at 10:13 pm

Why it won’t be a soft landing. Chart

#40 Jsan on 12.26.12 at 10:16 pm

What really caused the US economic crisis in the words of Canadian MP Pierre Poilievre speaking at the House of Commons.

“Avoid the Fiscal Cliff – Economic Freedom Speech – Pierre Poilievre”

http://www.youtube.com/watch?feature=player_embedded&v=wWkUaJId7pM#!

#41 Smoking Man on 12.26.12 at 10:22 pm

What soft landing are you all on drugs, take a walk around the hood. , spring market around the corner, the tiny tiny amount of inventory in the hood all sell fast.

You will all be surprised at market strength. Don’t even bother chirping, you will look foolish I am April….. I see the future better than anyone here.

#42 Thoughtful observer on 12.26.12 at 10:22 pm

Pink Floid. Yeah, they’re ok. Smoking Man. Lets do a dube sometime. Dylan plough my earth.

#43 Brian on 12.26.12 at 10:24 pm

Looks like selling a home now a days in Canada is like trying to sell the Titanic 100 years ago… on April 15 1912 after colliding with an iceberg during her maiden voyage to New York, that day everyone wanted off and some jumped to there deths

The only problem is there is a lot less life boats in Canada then on the Titanic.

It’s going to be a nasty crash try to keep your head above water.

Words from a young level’headed renter with a big savings in investments and not in property. I sleep very good at night because my investment pays for all my rent and more. :)

#44 Don't read his post on 12.26.12 at 10:36 pm

All these comments and not one by The smoking man?
Did he choke on Christmas dinner or is he still recovering from Christmas whiskey. Cmon man!!!! A part of me might start to miss you………………………..NOT!!!

#45 AprilNewwest on 12.26.12 at 10:37 pm

I get the impression that Garth thinks it’s too late for a soft landing???

#46 NotAGreaterFool on 12.26.12 at 10:39 pm

Garth, I think you have traditionally called for a 10% price pull back in Toronto (in general vs. particular neighbourhoods). These past months, you had become more bearish and have stated up to 15% is possible.

For proper Toronto, what is likelihood (%) of a greater correction in your viewpoint?

#47 Curious! on 12.26.12 at 10:45 pm

Prices in sauga will never come down… Feds can always relax the regs and turn fear to greed on a dime… No point waiting…

#48 Yuus bin Haad on 12.26.12 at 10:49 pm

Don’t F with Mr. Market!

#49 Sebee on 12.26.12 at 11:01 pm

Why is it that I sense the end game in this will be largest transfer of public funds to the private sector in Canada’s history? And it will all be in the name of saving the country of course.

Anyone have a plan on how to get a slice when it happens?

#50 Curious! on 12.26.12 at 11:01 pm

Agree with #38…real estate is a lost cause… Garth, how about making this blog more investment centric?

#51 mortgagebrokeront on 12.26.12 at 11:06 pm

garth is right, there will be a correction in the marketplace, its just a matter of how much??

With the new rules flaherty passed along , it has reduced size of mortgages the new buyers are prequalifying for.

Lot’s of younger buyers can’t get into the housing market unless mom and dad are giving them big big “gifts”

lets see this time next year if it’s a small slide or level prices or carnage.

I am going to keep brokering mortgages and lets see what happens!!!

#52 Fleabitten Monkey on 12.26.12 at 11:11 pm

Were there not recent suggestions by Ottawa that they are still vigilant and would be ready to act if the debt ratios continued to spiral upward with continued aggressive activity in the real estate market? How does the Genworth deal make sense with respect to this?

#53 Min in Mission on 12.26.12 at 11:11 pm

#8 – Happy Renter –
…. under $65,000 a year..

Wow, I have been a “low income earner” my whole life.

Amazing how much things have changed in such a short time. When I started work, my first job paid $3.00 an hour!! That is “low income”!!!

I am sure glad that I am getting toward the end, rather than at the beginning!!

#54 young & foolish on 12.26.12 at 11:14 pm

Many think that “economic realities” drive the market …. but it’s politics which trumps everything in the end.

The government stepping in (and facilitating inflation in the housing market) was/is all about stopping the economy from collapsing. In the spirit of Keynes, but with strings attached (and pulled by vested interests).
Unfortunately, there will be losers. Make sure you end up on the right side of the trade … own the debt.

Forget about betting against the system … if it goes down, you are going down with it.

Today’s First World struggle: How to placate the masses while preparing them to settle for less vs. a more equitable distribution of the returns from productivity (ideally based on a merit driven system).

#55 Mark on 12.26.12 at 11:14 pm

Anyone have a plan on how to get a slice when it happens?

Own stock in the big 5 federally chartered banks (but stay the heck away from Credit Unions — the sector will probably implode!). Own stock in the gold miners. Buy such stock on margin since the BoC will be holding policy rates down for an extended period of time (won’t help the mortgage borrowers though, as the interest rates applicable to housing loans are likely to skyrocket as banks prefer to lend against other collateral).

#56 Rob on 12.26.12 at 11:14 pm

#16, 27
If you already have a tenant, you can only increase rent by a certain percentage a year according to the BC Tenancy Act which is not much at all. There are a lot of deals in the Lower Mainland and everything is negotiable. Also, I finally found good working tenants who look after the rental as if they owned it. No way would I increase the rent.

#57 Dear Garth on 12.26.12 at 11:17 pm

Garth, could you explain how this news would impact the rate of real estate deflation? I’m waiting for the fear to kick in so prices drop faster.

#58 45north on 12.26.12 at 11:19 pm

Canadian watchdog: Why it won’t be a soft landing.

sales are down, ergo prices are coming down?

#59 Madame Guillotine on 12.26.12 at 11:25 pm

Don’t know if this has been posted here before or how accurate it is.
It mentions that a lot of information is not available from your “open and transparent government” but I have seen similar figures from other sources.
It seems that Senor Ponzi was a bit of a piker.
http://www.economicreason.com/economiccrisisexplained/canadian-banking-system-exposed/

#60 Canadian Watchdog on 12.26.12 at 11:28 pm

#36 OkanaganInvestor

I'll add to that post.

Garth Hotub 

Garth USA

#61 Chasicakes on 12.26.12 at 11:44 pm

Quite the damning article in the globe tonight. 3rd one on real estate and CMHM this week I think, http://www.theglobeandmail.com/report-on-business/economy/housing/cmhc-ottawas-800-billion-housing-problem/article6732755/

#62 Shane on 12.26.12 at 11:54 pm

Garth, are you saying the housing market will be going up now…instead of down?

#63 ozy - Use your brain without catering to RE doomers nor RE pumpers on 12.26.12 at 11:56 pm

People are confused, prices might go up&down in -10% to +10% range, in the next 12 months.
It is already -5% down in Toronto, it will continue with another -5% by January-March, then April will recoup 5% and June another 5% to reach last summer prices. Then again -5 down, and so on.
Because, multiple FORCES at at play, maybe five short, five medium and five long term, I won’t list them. Use your brain without catering to RE doomers nor RE pumpers. A few forces at play (+) were referenced in today’s article and comments. Other few forces at play (-) come from today’s article and comments.
When hyperinflation hit my country in 1990-1998, it was 100% per year. Unemployment 25%. RE prices went down in gold money (or stable foreign currency). So, watch the demographics, as it determines supply&demand, but also watch the WEALTH of your fellow citizens, when you see more people leaving the country or die, then it’s time to bail out. We are 5-10 years away from that, as things develop in slow motion (6-10% real price inflation a year here)

#64 periwinkles on 12.27.12 at 12:08 am

GTA: 60 years ago the suburban bungalow boom. Today the peak of vertical living ownership? Price to income ratio is where it will gravitate.

Ritz-Carlton what an unclassy location. Enjoying Florida Sherry?

One of the seven sisters left First Canadian and now for the first time in decades her snottys have to walk outside in the elements.

#65 Mr Buyer on 12.27.12 at 12:11 am

The more that I think about it, the more it seems like there is a serious crisis at Genworth that had to be staved off. Is the companies viability not adversely impacted by continued declines in assessed values of real estate that is backed by Genworth mortgages? This maybe more of a bailout rather than another batch of cash to be thrown into the bubble. I am out of my depth in this arena really and more than a little dumbfounded. Isn’t there a batch of bank regulations that have more or less eviscerated the I have nothing to lose so lets borrow a ton of cash pool of buyers or is Genworth exempt from those lending restrictions? Can this be for real? More money into the bubble that is collapsing? Smoking man your days are numbered as you know full well. I do not imagine I will be cleaning egg off my face even in the spring and even with Genworth set to chuck a ton of cash into the bubble for private profit from the public coffers.

#66 Canadian Watchdog on 12.27.12 at 12:13 am

#60 45north

Prices are not that important at this time. Liquidity matters more. GTA isn’t even passed the sales volatility stage yet.

It’s going to get bad and the problem will be exacerbated when lenders start rejecting loans. You’ll hear about it soon.

#67 Basil Fawlty on 12.27.12 at 12:25 am

A soft landing may be difficult, given that the plane is flying upside down.

#68 Mr Buyer on 12.27.12 at 12:28 am

Even if Genworth re-inflates the bubble momentarily I am still not going to buy at this time. Houses are too expensive. I can hunker down and wait it out rather than throw all my cash into shelter. Houses are going to get much much cheaper and they are going to be assessed much cheaper even faster than that. I imagined a few months ago this would be a possible way forward with the underlying message being ‘we the government will not stand by idle as you qualified individual buyers refuse to pay inflated prices, we will actively create new less qualified buyers that will drive the inflated prices up even further so you more liquid buyers sitting on your hands you better get in now or else pay more later. We your government will misdirect the collective might of the Canadian people against you and continue propping up the housing market for personal and political gain. PS: your children do not need so many winter clothes and you do not need to eat so much or spend so much at the dentist or pay for your kids education unless of course it is from the proceeds of selling your own house at inflated prices. By the way all you Canadians that do not have houses you can expect to get less money in welfare payments and no giving Genworth money is NOT welfare.’

#69 Mr Buyer on 12.27.12 at 12:30 am

#65 ozy
…………………………………………………..
This is not a cycle. It is a real estate bubble and a huge unprecedented one at that. You can forget about cycles. This is a one off event for a generation or two at least.

#70 Grim Reaper/Crypt Speculator on 12.27.12 at 12:32 am

(2) points….

(i) should we send out a search party for Dr Wanker? ..hands up…..(Hmmmmthats what my algorithm predicted) +/- .ooo1%

(ii) at least Garth didn’t use the ” Elfin deity”

#71 Stupid Canucks on 12.27.12 at 12:32 am

http://business.financialpost.com/2012/12/26/trump-tower-torontos-condo-market/?__lsa=1cc7-25f5

#72 Sebee on 12.27.12 at 12:33 am

And just like that…idea for 6000 SFHs in Toronto on the cheap.
What? You wouldn’t live in a 4000sqft laneway home?

http://m.thestar.com/news/gta/article/1307204–can-living-in-laneways-fix-toronto-s-density-issues

This is exactly what 416 needs – some cheap inventory.

#73 Ravishing Rick on 12.27.12 at 12:44 am

Great article in the globe… finally it has gone mainstream. Pacifica Partners’ latest report also blamed Flaherty on the housing bubble and indicated David Dodge was a hero.

#74 Hoof - Hearted on 12.27.12 at 1:42 am

#17 Mark on 12.26.12 at 6:52 pm

The extra limit room for Genworth won’t do them any good once everyone realizes they’re severely undercapitalized relative to the risks they take. History has generally shown that most government loan guarantees granted tend to be exercised and payable by the government.
=================================

Explainez vous SVP?

Garth sez:

” While making a big deal of capping CMHC mortgage insurance as it nears $600 billion – theoretically putting the brakes on high-ratio, high-risk 5%-down deals – F has now thrown a new $50 billion into the marketplace, but this time to the private sector. Companies like Genworth have just received a massive 20% hike in their allowable coverage, which means the federal government will guarantee $300 billion worth of that company’s debt, up from $250 billion.”

If I unnerstandez…..(2) things are happening concurrently:

(i) the Gov’t is in bed with the “Bankster -Realtor money laundering” Joint Venture….

(ii) they are buying time to delay the inevitable but will pass the “extra $50 Billion hat” which WE , the taxpayer, will be forced to cover via the taxpayer liability called CMHC.

aka if their is $50 Billion more on the table….it will rest assured find its way out of OUR pockets into THEIRS.

#75 Guy1 on 12.27.12 at 1:48 am

You offer an important public service, Garth. There are those who offer measured comments on your blog and others who do not. But, there is also a silent majority who sit quietly behind their computers and deeply respect your insights and wisdom… recognising that no one is perfect but people such as yourself are far more learned than the majority. I gather that your understanding of our political economy is partially rooted in your family history (as your grandfather, Ebenezer Vining Bodwell, was an Ontario businessman and political figure). I deeply respect your guidance. You have proven to be accurate most of the time. I have spoken to a few key economists, and they have confirmed your honesty. You have guided my wife and I away from 1) Canadian property and 2) the ‘BMO salesman in drag’ towards 3) renting a modest home and 4) meeting someone from Raymond James who will help us create a balanced portfolio for our retirement. We were in a very precarious space before we read your blog. But, thanks to your thoughtful efforts, I have learned about ETFs, REITs and Preferred Shares as well as the advantages of TFSAs. I’m currently studying about the differences between various corporate bonds… none of which would have even happened had I not seen your blog. And, I have shown your blog to so many salt of the earth souls – friends ranging from a nurse to a teacher to an electrician – good, generous people who work so hard – and who now benefit from your guidance. Anyhow, please don’t ever underestimate the silent majority who so very much value your thoughts. I just felt I needed to say that to you today in case you might feel discouraged.

#76 Guy1 on 12.27.12 at 1:52 am

My apologies (it’s been a long day)… an important correction: your great-grandfather, Ebenezer Vining Bodwell…

#77 Cowtown Refugee on 12.27.12 at 2:03 am

The addition of $50 billion in gov’t backing means nothing. In the U.S. interest rates crashed and the market still tanked.

People are tapped out. No story here. Except for the popping sound.

#78 Tony on 12.27.12 at 2:19 am

The morons who watched Genworth (Canada) jump 3 percent will get a lump of coal next Christmas when the company declares bankruptcy.

#79 Interesting Times on 12.27.12 at 2:21 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. Federal gov’t firing 20,000 alone in Canada. All gov’t jobs under attack.

- 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! Latest victim is GM Canada who will be closing Camaro Plant in Oshawa & moving it back to the US. If RIM does not launch there new product properly they will be gone also. What will Canada be left with? I guess over priced housing that nobody can afford.

- 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! Wish everyone on blog happy holidays.

#80 Tony on 12.27.12 at 2:24 am

Re: #65 ozy – Use your brain without catering to RE doomers nor RE pumpers on 12.26.12 at 11:56 pm

Prices will go straight down for the next 2 years straight (every month) in Toronto before there is ever one dead cat monthly bounce upward. 24 straight months down 100 percent guaranteed.

#81 Ronaldo on 12.27.12 at 2:41 am

Wow, that was some article in the Globe. Finally, the word is out to the masses on how this whole mess with housing was created. Yep, C got out in time alright. Now let’s see what F does. Will he be the next one to bail? And they tried their darndest to make the world believe we were different. What a joke. There will be no soft landing. There will be a race to the exits come spring but unfortunately the doors will be closed. Prices are going to drop like a lead balloon. Good job boys. The fallout from their little fiasco in the housing market will be around for years to come.

#82 Richard and Zeus on 12.27.12 at 3:03 am

The only thing keeping this market going are overpaid useless govt workers and immigrant criminal tax cheats. Neither of which pay taxes to society (govt workers do not pay tax – you cant pay tax on something funded by tax).

It will be interesting to see which one dictator H takes out first…..

#83 Aussie Roy on 12.27.12 at 3:10 am

House prices and positive bias.

Kyle Bass provided much more color than the normal 30-second soundbites that we are subjected to when serious hedge fund managers are exposed to mainstream media. This year, Bass was the keynote speaker and in the following speech (followed by Q&A), the fund manager provides 60 minutes of eloquence on the end of the grand experiment and its consequences. From Money Printing and Central Bank Balance sheets to Japan and the psychology of the current situation – which in many cases trumps the quantitative data – the question remains, “when will this unravel” as opposed to “if?”; Bass provides his fact-based heresy against the orthodoxy of economic thought “On The Financial Nature Of Things”.

Excellent note regarding how most poeple think ” a housing crash only happens everywhere else, except where I live”. Positive bias at its best.

Worth a watch

http://www.youtube.com/watch?v=JUc8-GUC1hY&feature=youtu.be

#84 Michael F on 12.27.12 at 3:34 am

As an Australian ignorant to all things Canadian, who is F and the Peckerettes?

#85 blobby on 12.27.12 at 4:27 am

i’m confused, can someone clear this up for me?

If F is running scared, why not just turn on the lending taps again?

postpone the problem.. Surely they can do that for the next three years then blame the next government?

#86 sheik yahboudi on 12.27.12 at 5:43 am

Jim Flaherty does not have the proper educational prerequisites to be manipulating the levers of a macroeconomy.

So I am not surprised that the end result will look a lot like what would happen if I gave the controls of a 747 jet to the five year old during a cockpit visit.

It might take some time and the kid might even keep it straight and level once in awhile but in the end there WILL be crumpled metal, flames and some tears cause it will hurt.

#87 Devore on 12.27.12 at 6:15 am

#16⁠ TRT

Really? Landlords always think rents should be higher. I think I should be paid more. Ironically, this is the only way rents are going up. The proof is in the pudding. Rents are going no where.

Tomorrow I am having lunch with friends who bought a pre-sale condo in Calgary a couple years ago (ho ho ho!). A typical mediocre studio so popular with “investors” these days. Last. I saw them, they were hoping to rent it out for 2 grand (ha ha ha!) They’ve already lost their downpayment to the leverage fairy, and I will be truly well shocked if they found a fool idiot enough to pay 2000 of his hard earned dollars for something without even a proper bedroom.

#88 salonist on 12.27.12 at 8:05 am

“Pensions will not exist by 2050, expert warns”

http://www.telegraph.co.uk/finance/personalfinance/9741893/Pensions-will-not-exist-by-2050-expert-warns.html

#89 Realtors in an all out PANIC! on 12.27.12 at 9:15 am

TRT you are obviously a worried and out of work realtor. Sad you think your mindless and idiot posts will effect the housing crash from stopping. The house crash in Canada will continue in Toronto , GTA and the rest of Canada. You are even claiming in your posts that Canada’s housing bubble is nothing but a ponzi scheme which eveyone in Canada already knows. The sad reality is people don’t even have 5% downpayment and now the house of cards is falling apart. It’s going to be a NASTY housing crash realtors , a NASTY crash!

#90 Realtors in an all out PANIC! on 12.27.12 at 9:25 am

Interesting Times #81

It is interestng times. Did you notice how EMTPY the malls were this year? I did some last min shopping in Yorkdale and I had NO trouble finding a parking spot and walking around the mall you would think christmas was months away and not a few days. Same thing in Eaton centre the mall wasn’t full like it would of been in 2004-2006 when you couldn’t even move. People don’t have money as they have maxed out their creditcards and can barly pay their bills. Many home/condo “owners/money renters” will be looking to sell in spring or go bankrupt. The house of cards is falling apart.

#91 T.O. Bubble Boy on 12.27.12 at 9:28 am

@ #89 blobby on 12.27.12 at 4:27 am
i’m confused, can someone clear this up for me?

If F is running scared, why not just turn on the lending taps again?

postpone the problem.. Surely they can do that for the next three years then blame the next government?
————-

How is backing another 50 Billion in mortgages not “turning on the taps”?

Yes – it is more low-key than direct stimulus, but still a way for $ to flow.

#92 tkid on 12.27.12 at 9:37 am

Devore, $2000 for a bachelor is excessive, even for in-demand Toronto. Max a bachelor will get in T.O is $1400 and that is with parking and storage.

Michael F, ‘F’ is our Minister of Finance, Flaherty. I forget who the peckerettes are.

#93 Dom on 12.27.12 at 9:44 am

Mr buy #67

serious crisis at Genworth

Yes Genworth is in serious trouble and for those who don’t know they have a few FORECLOSURE departments which deal with different parts of Canada. A friend of mine works in the BC department and tells me many are foreclosing as no one can keep up with the ponzi scheme payments . Remeber prices are down alittle over 15% which makes all those 10% downpayments go bye bye. Many have used their HELOC’s just to survive. With HELOC’s maxed out and prices falling every month it easy to see people walking away. That’s the sad reality. I think genworth also got bailed out.

#94 IM in C on 12.27.12 at 9:50 am

@ #18 trt
I’ve been saying that for years. Kudos for finding a way to say it so subtly that it slipped past the pc filter

#95 maxx on 12.27.12 at 9:54 am

……meh…..people continuing to get suckered into pouring their futures into a declining asset.

The inevitability of economic fundamentals will eventually prevail.

#96 The real Kip on 12.27.12 at 10:10 am

“For example, “Trump Tower Woes signal Top of Toronto Condo Market,” was the headline Bloomberg stuck on the top of its story detailed the plight of investors suing to get out of Canada’s tallest residential building”

I just read the story of Hubert Crockett and tears were streaming down my face as be outlined how he was unable to make up to 27% return on his Trump Tower investment. Retired from the World Health Organization no less, and now living in France he is suing the Donald himself for some sort of misrepresentation.

It’s amazing how people with so much money can be so stupid!

#97 Gypsy Kid on 12.27.12 at 10:38 am

I cant believe what the Cons are/were doing is legal…we are wwwaaayyy too complacent as a nation. Our kids/grandkids will be paying for today’s house horniness.

aarrgghhh…i feel helpless.

#98 Scalgary on 12.27.12 at 10:42 am

Six years ago F gave us 40-year mortgages and zero down. Four years ago the amount of government mortgage insurance was doubled. Three years ago came the cheapest mortgage rates in history. In between were new tax credits for first-time buyers and free money for renovations – all designed to goose housing. Then he pulled back hard last summer, sending the market into a dive. Now, desperate, he lays on more gas.

No one exposes/speaks about this flat truth to the mass Garth… This statement should be at the back of the ballot sheet in next election…

Keep up the great work…

#99 Serge on 12.27.12 at 10:47 am

“In Toronto and Vancouver the spring market begins in less than thirty days. ”

C’mon Garth, you should know the timing better than that with all the real estate you personally own!

By you saying Spring market starts in less than 30 days knowing that historically january is a slow month, are you doing that to say “I told you say?” Pathetic.

In 416 and Van that is an accurate statement. Where are you? Moose Jaw? — Garth

#100 HogtownIndebted on 12.27.12 at 11:21 am

Merry Christmas to Garth and all here!

Thanks, Garth, for your helpful insights shared here. Candy canes and teddy bears to you for all that.

And now, one wee lump of coal:

You have told us how you think the US fiscal cliff stuff is pure political theatre, or words to that effect.

I think that in real time we are seeing now this is incorrect.

http://www.washingtonpost.com/business/economy/obama-and-senators-returning-to-washington-for-one-last-fiscal-cliff-effort/2012/12/26/864e1f36-4f98-11e2-950a-7863a013264b_story.html?hpid=z1

http://www.nytimes.com/2012/12/27/opinion/a-fiscal-cliff-endgame.html?hp

Your problem, Garth, if I may be so bold, is that your common sense got you drummed out of neocon hindquarters so quickly. Had you remained, you would better appreciate the true maniacal perversity of neocon thinking (wait, isn’t that an oxymoron?)

South and north of the border, we see neocons more than willing to sacrifice the greater good for the sake of their ideological purity. In the US, if you are against tax cuts for the rich, you must “hate America”. Here, if you believe in reasonable free speech, you are “with the child pornographers”. Not since 1930s Europe have we witnessed such brazen public acknowledgment of misguided and erroneous ideology.

My guess is that tumbling over the fiscal cliff is now about 70% likely, with barely five days to go. The US Republicans, vote splitting and calculating just like their inbred Canadian cousins, would rather go over the cliff and then be seen to lower the soon to be inflated taxes in an act of sleight of hand than to make the more reasonable compromise now, even if it would mean higher overall taxes on the rich in the end. Appearances and talking points in the next campaign matter most to them. As well as not getting on Grover Norquist’s naughty list. P.S. Is it just me, or does this guy not sound like a Sesame Street character who deservedly died on the cutting-room floor?)

The political theatre, such as it exists, is entirely on the right, in that sense. (This willingness to put theatre before substance has been part of the neocon political strategy for decades now) So it makes sense now to recalibrate: if the whole (non) debate really is political theatre, it now must clearly include the likelihood of a new and damaging set of events after going over the cliff, as a second act: a disastrous encore to be applauded only by the same kind of NRA idiots who think teachers should be armed and that gun problems should be addressed by looking into everything except firearms.

To will your own people to face unknown calamity for the sake of your political skin is truly appalling. Read the attached editorial about how many may lose all government benefits immediately, and think of their suffering as deemed so trivial by the Republican far right.

The willingness to open up pandora’s box as part of all this bodes very poorly for the US and will affect how well others are willing see the Americans as financial or political leaders.

In the next few days, anything could happen, agreed. But there is little to suggest major change in tea party thinking to allow the US to avoid this plunge. While we look at the trends in real estate and indebtedness, we may find 2013 holds some serious wild cards that may have an overwhelmingly negative effect on society, the economy and real estate, in the form of self-inflicted political wounds and unexpectedly negative economic and international events.

Double rum in the eggnog this new year’s eve – we may all need some more anaesthetic.

#101 Q on 12.27.12 at 11:38 am

That half baked little elf “F”…must have a generous amount of Genworth stock in his “blind” portfolio. Anyone want to bet which boardroom will house the largest number of crooked ex MPs in a few years?

#102 };-) aka D.A. on 12.27.12 at 11:39 am

The markets will not crash because we won’t let them.

Looks to me like the market in Kelowna is doing just fine, thank you very much. };-)

http://i46.tinypic.com/9ix0fs.jpg

Oh and rents? They appear to be up where the cap. rates are beginning to make sense to buy rental properties once again.

Ya snooze, ya lose.

#103 jim on 12.27.12 at 11:45 am

#90,

“Jim Flaherty does not have the proper educational prerequisites to be manipulating the levers of a macroeconomy.”

Two things:

a) do you really think he sets policy all by himself, and that no one else has any influence? Really?

b) exactly what ‘academic credentials’ are sufficient to centrally manage an economy. Please tell me how all those PhDs in economics (like Ben Shalom Bernanke) fared.

Economies cannot be managed centrally. We learned that from watching socialist countries fail. That includes centrally managed monetary policy.

#104 Tony Right on 12.27.12 at 11:48 am

Trudeau 2014

#105 Doug in London on 12.27.12 at 11:51 am

F has now thrown a new $50 billion into the marketplace, but this time to the private sector, when taxpayers are already on the hook for over half the $1.2 trillion in residential mortgages.

Correct me if I’m wrong, but isn’t this government intervention of the market the kind of thing the Conservatives are against? Aren’t they (or weren’t they once, many years ago) the party that believed in less government intervention and more of letting the market sort itself out?

#106 Ret on 12.27.12 at 11:57 am

#87 Aussie Roy -Thanks for the Kyle Bass link.

I didn’t know that he had done another recent speech. Loved Kyle Bass’ lifestyle in the first chapter of Michael Lewis’ Boomerang book.

Nothing like making millions from the greed and eventual downfall of others. Blog Dogs would surely enjoy some of the other Kyle Bass clips on You Tube.

#107 Franke le Skank on 12.27.12 at 11:58 am

I’m not 100% certain what the 50 Billion cash injection really means in the grand scheme of things. Will it allow Glenworth to kick the can a tiny bit longer? Maybe even provide a bigger dead cat bounce? It seems somewhat irrelevant at this stage of the game and further gov intervention would be required for the fabled soft landing. By further gov intervention I don’t mean blindly throwing cash into the system, but a co-ordinated effort to balance the economic fundamentals required for a healthy economy and bubble free housing.

#108 BPOE's BrainFart on 12.27.12 at 12:02 pm

Sounds like a Genworth “bail out” to me…….

#109 daystar on 12.27.12 at 12:24 pm

Is this 50 billion package 90% government backed or 100% government backed… does anyone know? Couldn’t find the answer in media links a few days back. Lil’ help!

Presumably 90%. — Garth

#110 Hoof - Hearted on 12.27.12 at 12:30 pm

#108 Tony Right on 12.27.12 at 11:48 am

Trudeau 2014
======================================

Yeah right,and he’ll hand the Leafs the Cup.

#111 };-) aka Devil's Advocate on 12.27.12 at 12:45 pm

#103Serge on 12.27.12 at 10:47 am
“In Toronto and Vancouver the spring market begins in less than thirty days. ”

C’mon Garth, you should know the timing better than that with all the real estate you personally own!

By you saying Spring market starts in less than 30 days knowing that historically january is a slow month, are you doing that to say “I told you say?” Pathetic.

In 416 and Van that is an accurate statement. Where are you? Moose Jaw? — Garth

January sales are those contracts generally entered into in December which go firm in January. Therefore January isn’t really January at all but December, which is, indeed, the slowest real estate sales month of the year. That said my personal December was surprisingly productive.

The busiest months of the year are typically April and May for which the results show up in the May and June statistics as shown in this chart of the Central Okanagan volumes each month this year to date (December numbers not fully in at this time). In any event it would be incongruent to measure any of those months against the month prior and even to some degree to compare it to the same month a year before. Really to make a reasonable assessment you need to look at the trend like this chart which clearly shows the bubble which ensued after 2000 and the five years of stability which followed it’s popping in 2008.

2002 to 2007 was unreal and unsustainable. The only thing wrong with these markets today is those who wish the credit bubble would have lasted longer. This is not a departure from norm, this is a return to it.

That was not my intent, obviously. In Toronto and Vancouver the third week in January (depending on weather) marks the start of a season of new listings and the rekindling of buyer interest. Sales are usually recorded in February and March, a reality born out in local board stats. — Garth

#112 Tony on 12.27.12 at 12:51 pm

Re: #16 TRT on 12.26.12 at 6:46 pm

In the meantime Genworth (Canada) share price or value will drop about 98 percent just like Fanny Mae and Freddie Mac.

#113 rosie on 12.27.12 at 1:08 pm

#82
Does that mean in 2 years houses will be free? Woohoo!

#114 Canadian Watchdog on 12.27.12 at 1:18 pm

#113 daystar

What is unreported here is that the Government is giving back all of Genworth’s collateral for the 90% backing, in exchange, Genworth will pay a higher premium for guaranteed loans . Read points 3-4. Link

In other words, F just gave back Genworth’s security deposit to help pay the new higher premium back to the government. It’s a ponzi-bailout.

#115 daystar on 12.27.12 at 1:33 pm

If folks out there in internet land were told of a political party that took in 20% of their political campaign donations from just one individual (that the public can prove, initially it was 28%), that it was illegal to do so but the winning party took it anyway and that the donor was in negotiations to get:

- free real estate for a professional hockey team stadium
- $100 million worth of free tax dollars contributed by a provincial government to help with the construction costs of a $450 million dollar stadium
- a free casino licence and casino to boot, built outside the stadium itself.

Would that seem like corruption to you? To anyone with common sense it would… but this happened in Alberta to a newly minted governing party now in power for 42 years in a province supported virtually unanimously by media and powerful oil lobbies.

http://www.theglobeandmail.com/news/politics/billionaire-oilers-owner-katz-gave-430000-to-alberta-pcs/article4647260/

http://www.huffingtonpost.ca/2012/10/30/daryl-katzs-tory-donations-tax-money-for-pharmacists_n_2045936.html

http://www.huffingtonpost.ca/2012/10/25/daryl-katz-donation-edmon_n_2018817.html

Naturally, the premier and leader of the Alberta Conservatives simply “did not know” where her campaign donations came from. And, after declaring that the province of Alberta will not fund the construction of a Casino/stadium, what they instead intend on doing is give it to the city of Edmonton with the condition that the money be spent “on a Casino and stadium”. Small suprise. And then there’s this:

http://blogs.calgaryherald.com/2012/12/07/public-has-a-hard-time-grasping-complex-scandals-say-authors-of-alberta-political-history/

Allison Redford’s ex-husband (separated for conflict of issue reasons only from what I can tell) certainly didn’t mind when Redford, still sitting as a judge, awarded the government contract to her hubby or ex or whatever. It seems a little easier every day to conclude that one can only think that this is the kind of Conservative judge Harper has in mind to replace those “damn Liberal judges” he so loathes. Its all in keeping with Alberta politicians so to speak to look after their own. Whether its MLA’s who get paid $40 G’s for never showing up to work (or even fake it):

http://www.cbc.ca/news/canada/edmonton/story/2012/03/07/edmonton-alberta-committee-never-meets-teddys.html

Whatever the case may be, one has to realistically wonder why Allison Redford still has a job. Is it because she’s a Bilderburger? A former “conservative” judge? Or just an Alberta Conservative. After all, how could the voters there have ever made a mistake?

And for that matter, how could one even remotely insinuate that F & H took bribes for handing $50 billion worth of insurance guarantee’s to a corporation that doesn’t even pay taxes in Canada (it’s parent is, after all, american). Why, its not like its public knowledge that Glenworth was one of the main lobby groups associated with the National Citizen’s Coalition when Harper presided as president during his 5 1/2 years there. Yeah… who would dare insinuate that Harper outshines his political Alberta brothers and sisters when it comes to corruption.

#116 NoOneOfConsequence on 12.27.12 at 1:34 pm

What is always forgotten is that the government cannot make “small” moves. It is simply too big.
I liken their policies to a massive sledge hammer.
A simple “tweak” is a crushing blow, guaranteed to throw off all sorts of unpredictable events into the economy at large.
The Genworth deal is really about backstopping Genworth. That increased credit of 50 billion is about ensuring that Genworth will have some liquidity as property declines in value.

#117 Inglorious Investor on 12.27.12 at 1:35 pm

Have we not yet learned that centrally planned markets and economies do not work? We need free markets that are regulated by government, not manipulated by it.

I don’t think most Canadians truly understand how destructive government manipulation really is, because we are so inured to it, we can hardly imagine a world where it is not extant.

But until we have sound, consistent policy (e.g. mortgage rules that don’t change with the whims of special interests); truly free markets (let capital flow where it will be most productive); incentives to produce rather than incentives to acquire something for nothing (e.g. stock trading; banked sick days); and sound money (whose value is not diluted via too low interest rates and central bank ‘liquidity’) we will never reach our true potential as a nation.

We have a choice:
We can either take the easy route to failure, or the hard route to success.

#118 daystar on 12.27.12 at 1:43 pm

#113 daystar on 12.27.12 at 12:24 pm

Presumed it myself Garth, but wanted clarity before taking a shot at what extra insurance premiums will be related to the 10% that isn’t insured by government in bond markets. Thanks.

#119 };-) aka Devil's Advocate on 12.27.12 at 1:54 pm

In Toronto and Vancouver the third week in January (depending on weather) marks the start of a season of new listings and the rekindling of buyer interest. Sales are usually recorded in February and March, a reality born out in local board stats. — Garth

Serious buyers and sellers are interested all year long. The spring market is merely typified by a higher ratio of buyers and sellers who lack the serious motivation that compels them to list or buy “now” (whenever that may be). Be you a buyer or a seller; which kind of market would you rather cast your line in?

To say “January (depending on weather) marks the start of a season of new listings and the rekindling of buyer interest” demonstrates a lack of understanding of the real “market” which is ever-present. This is the ongoing argument I have had with Form Man who suggests that the 12plus MOI has significant influence on the market. Not really, as many of those homes while ON the market are not IN the market. And so too will it be with many of the “apparent” buyers this spring.

#120 daystar on 12.27.12 at 2:04 pm

#106 };-) aka D.A. on 12.27.12 at 11:39 am

Another self aggrandizer back to “change us” with his selfless wisdom. (yawn)

#121 };-) aka Devil's Advocate on 12.27.12 at 2:11 pm

Ultimately what sells a home is motivation. Without motivation NOTHING else matters. Motivation knows no seasons.

#122 Franke le Skank on 12.27.12 at 2:13 pm

#123 };-) aka Devil’s Advocate on 12.27.12 at 1:54 pm
RE is going down Okanagan boy!! Your self serving understanding of real estate is typical someone who’s livelihood depends on it. I must say you’ve been a great Devils Advocate on this site, but the fact that you can’t even acknowlege the changes in recent sales volume shows your deep seeded denial. Your near sighted tunnel vision will not serve you well. I hope you’re still posting on this site when the shit hits the fan.

#123 claudius emperor on 12.27.12 at 2:15 pm

The truly ‘blessed’ would be the retirees.

CPP has only 170 B in total capital.
Mortgage debt insured by the government stands at 1.2 T (CHMC + private insurers).
We could be kissing goodbye all of our ‘social services’ and ‘pensions’ pretty soon. So pay European taxes and get no benefits, no services and no retirement.
Norway has a fund with over 600 Billions (from oil revenue..) for the next generations. They have over 40 Billions of annual budget surplus that goes into the fund.
Whatever is called affordable housing here does not make any sense. As people living in basements (the ONLY place on Earth) does not make any sense. As condo fees do not make any sense.
I don’t think many people realize the implications of this bizarre financial policy and the impact it will have on all of us.
If one is to look macro-economically and account for all hidden liabilities suddenly US and especially Europe and not bad places at all in long run.

#124 };-) aka Devil's Advocate on 12.27.12 at 2:19 pm

#124daystar on 12.27.12 at 2:04 pm
#106 };-) aka D.A. on 12.27.12 at 11:39 am

Another self aggrandizer back to “change us” with his selfless wisdom. (yawn)

Not you or those like you daystar but rather those to who you and those like you will ultimately fall prey to. The market needs greater fools it’s a part of the Pareto principle which is a fact of life. Not everybody can be a rock star.

#125 Junius on 12.27.12 at 2:38 pm

#121 Inglorious Investor,

You said, “Have we not yet learned that centrally planned markets and economies do not work? We need free markets that are regulated by government, not manipulated by it.

I don’t think most Canadians truly understand how destructive government manipulation really is, because we are so inured to it, we can hardly imagine a world where it is not extant.”

I mostly agree. However I think what we should be seeking are competitive markets as opposed to so-called free markets. All free markets are quickly manipulated by the strongest players and made anti-competitive. The notion of self regulating markets is among the biggest fairy tales told to our society. Markets tend towards anti-competition and consolidation not the other way around.

We have very little operation of market forces in our society. Everything from the price of oil to pharmaceuticals to media to health care are heavily dependent on how they are organized by the government or at least where organized and remain perpetuated or institutionalized through government forces.

We can and should rail against the housing industry, the MSM and the government intervention in Real Estate . However, ironically, housing is still more open and free a market then most of our economy.

#126 Bill Gable on 12.27.12 at 3:32 pm

# 81 nailed it.

Oh, and if you think China will have a soft landing, or magicallly bail out the cretins in Washington – put down the whiskey bottle.

China is a ponzi scheme – and while their avaricious one percent, load up on high end cars, there are still 150 million people that are barely making it.

The next decade will be one that will be written, and studied about for a hundred years, that is assuming we aren’t wiped out, by then.

Most of my Boomer cohort are so broke, they have nothing to fall back on, but huge debt.

If you follow Mr. Turner’s advice – you will be a lot happier come the day.

Life flashes by.

#127 hangfire on 12.27.12 at 3:32 pm

I read F’s latest knee jerk as political rather than anything generated towards industry…think about it…why a private lender??? I’ll hint you..who loans the most to new immigrant voters? Banks you say…you would be wrong….mortgages are genrated out of brokers to private capital because the new immi doesn’t qualify even for the loosy goosy undercapitalized immgrant. Votes people…its all about pandering for votes!!!! The government keeps bringing in immigrants who are not qualified to work in Canada…so who has beem employing them…right the Government(s) muni-city-prov-fed all subsidized. Taken a good look at the airports latelt…I have never been met by more greeters than at the Vanc YVR….what are they doing someone asked as we deplaned from Texas……Ita a make work tax and spend job I reply……votes people …votes. The Libs did the same when then fractured sounthern Ontario and created 200 new seats in Parliament in fifteen years of solid dumping bodies into constituencies dependant on Lib largesse for their life in Canada….who were the reps of those constits????….Hey in the third world thats how it works….the LIbs learned it…and now the cons are pandering to the lowest common denominator.

Sounds like that includes you. — Garth

#128 Sebee on 12.27.12 at 3:33 pm

Don’t rush into Spain just to get your EU residency just yet.

“There are 800,000 used homes on the market. Developers are sitting on a further 700,00 completed units. Another 300,000 have been foreclosed and 150,000 are in foreclosure proceedings, and there are another 250,000 still under construction. It’s crazy.”

Further 30-50% drop predicted for Spain by 2018 or sooner.

#129 Sebee on 12.27.12 at 3:48 pm

I’m sure many of you have seen the good article on CMHC in Globe. But no one is picking up on the quote below. I can’t belive this is the case. Since when was is CMHC’s job to compete with private firms and to fight for risky borrowers with a private company for market share? This is the decision that has resulted in this mess. They talk “crap” now about wanting to privatize CMHC at great cost to tax payers I’m sure. But all they had to do was not compete against private company and they would not have to worry about a $600B portfolio. It would already be some other private firm’s problem.

>
The American companies were willing to do things CMHC had never done. Some were even backing “zero-down” mortgages in which the buyer borrowed every dollar needed to pay for the home.

It was a race to the bottom, and CMHC was playing along. “We didn’t lead it … As we lost market share, we would follow what the American companies were doing,” said former CMHC chairman Dino Chiesa. With money available and the economy booming, home buyers streamed into the market and prices soared.

http://www.theglobeandmail.com/report-on-business/economy/housing/ottawas-800-billion-housing-problem/article6732755/?page=all

#130 Dave the dentist on 12.27.12 at 3:50 pm

Thanks for the great blog Garth, I’ve learned a lot over the last few months.

#131 betamax on 12.27.12 at 4:35 pm

#125 “motivation” aka ‘demand’ is what fuelled every bubble throughout history — till they popped. Demand is a leaky vessel to base your argument on.

#132 Mad Scientist on 12.27.12 at 4:36 pm

Can anyone enlighten me on this fact (or pitfalls) – we have a mortgage in it’s final stages – if we pay the weekly payments – we are looking at 3 more years – I have the opportunity to make a nice bag of coin which could essentially wipe out our mortgage – now, before anyone goes off telling me to invest it – I am risk adverse and I would lose sleep outside my comfort zone -

So question – I would be hit with a huge penalty for breaking my mortgage early – someone noted if I stop paying my mortgage, after 90 days (from what I have been told) – the mortgage company will send a demand letter asking for the entire balance remaining plus the interst cost for the past 90 days – I would be able to pay it off – and save the penalty fees –

Yes, it will temporarily hit my credit rating – but if I can save almost $17K in penalty charges – wouldn’t that make sense –

Just asking!!

Of course you would not save the fees. — Garth

#133 Form Man on 12.27.12 at 4:41 pm

#123 DA

Best of the season DA !

Once again you are complicating things too much. What I actually said was home prices would continue to slide until MOI is at or below 6. I am not alone in this belief, as it is accepted as fact by every accredited real estate association and analyst around the world. Indeed, when we look at historical data, we cannot find a single instance in history where this is not so, Kelowna being a classic example with an MOI at 15 and a real estate in a long slow decline ever since it crashed in 2009.

My personal favourite idiotic saying from deluded Kelowna developers is ” I am building now in a declining market so as to be ready for the rebound ! ”

This of course makes no business sense, as the developer will be selling at absolute rock bottom prices. Smart developers bring their product to market further along in the up cycle……..

#134 Guy1 on 12.27.12 at 4:59 pm

#88 Michael F

F = our federal Finance Minister

#135 metal-nut#756 on 12.27.12 at 5:08 pm

Mark (#57), can you please explain your comments?
“Question: Anyone have a plan on how to get a slice when it happens?

Answer: Own stock in the big 5 federally chartered banks (but stay the heck away from Credit Unions — the sector will probably implode”

How are credit unions different than chartered banks in regards to the real estate meltdown? Did Credit Unions not securitize and insure mortgages at the same percentage levels as the banks? In other words, do they have more potential bad loans on their books? Are they less protected by the government somehow? Are they not too big to fail, as the largest one has a mere 100 branches (vs 1,000+ branches for each 5 big banks)? Is it because Credit Unions have been able to offer more attractive LTV ratios than banks?

In short, what makes credit unions more susceptable than banks during the ongoing and upcoming real estate meltdown, I’d really like to learn more about this.

Thanks.

#136 joe calgary on 12.27.12 at 5:15 pm

#106 AKA Da

The reason cap rates make sense in Kelowna or Canada for that matter to you, is because rates are super low which wont last, and if you disregard prop tax, maintanance, ect. You can chirp this mantra to your realtor friends not the financially literate majority that visit this website.

A $400000 house that rents for $1300 a month in Kelowna during a housing bubble in a low interest environment, is not a sound investment going into the future. Maybe if you bought in Kelowna in 1999 before a bubble and now rent that house it may make sense, buying today in Kelowna or Calgary or anywhere in Canada to rent out is financial suicide, unless you want to do a good deed and subsidize a poor family.

If your into renting look to the US market where you can buy a house for $130000 that rents for $1300. And prices are bottomed out, with a higher average income then Canada.

AKA DA you are dillusional.

#137 HogtownIndebted on 12.27.12 at 5:19 pm

#127 claudius emperor

There are profound lessons in the comparison between Norway and Alberta.

It is so ironic that Alberta neocons consider themselves so upstanding and self-respecting. The truth is that successive Alberta conservative governments have behaved like Stockholm syndrome victims, bending over whenever oil companies ask them to comply. This is a province of political patsies with little self respect and precious little diversity of people or opinion. It will be their undoing.

The self-respecting Norwegians, by contrast, have taken back from the oilcos a heritage fund worth (2008) about $76,000 per citizen – in Alberta, it’s not even $5,000.

THAT is how a self-respecting government with conservative values plays ball with its economic future.
(And I would not care as a Canadian if such funds enriched only Alberta citizens or was spread across the country, by the way)

http://www.policyalternatives.ca/publications/monitor/april-2008-editorial-alberta-and-norway

An aside – he’s a shallow jerk (but apparently highly electable), but Justin Trudeau was absolutely right when decrying that Canada’s problem is too many Albertans in charge. (by the way, that comment will win him far more seats down east than it might ever cost in Alberta)

Alberta leaders as self-reliant cowboys? Gimme a break. Patsies and sissy girly-men who won’t stand up to big oil bullies is a far more acurate description of the conservative cultural/political ethos of Alberta. Rather than being Canada’s bravado free enterprise leaders, this province embarasses us all with its low self-esteem. Get some counselling and stand up for yourself, folks.

#138 45north on 12.27.12 at 5:45 pm

Mr Buyer: I am still not going to buy at this time.

you live in Japan, no you are not going to buy in Canada!

#139 Junius on 12.27.12 at 6:00 pm

#141 HogtownIndebted,

You said, “It is so ironic that Alberta neocons consider themselves so upstanding and self-respecting. The truth is that successive Alberta conservative governments have behaved like Stockholm syndrome victims, bending over whenever oil companies ask them to comply.”

100% correct. Well said. Try telling an Albertan that they were are being ripped off by the oil companies are watch them react. So smug but so stupid.

#140 Smoking Man on 12.27.12 at 6:10 pm

67 Mr Buyer
my days are number?

Un like you, I am not handicapped,I have no bielf system or wish full bias

Just a walking biological human supper computer inside my coconut.

Never wrong dude check the archives.

#141 claudius emperor on 12.27.12 at 6:38 pm

Political correctness is our biggest problem.

In a way I also would probably prefer:
The French waiter that threw me out of his restaurant at Champs-Élysées as I did not want to have lunch but just a coffee at 3.30 p.m. (coffee would not justify myself occupying a table while lunch apparently does)
To the old lady that I saw shopping at Loblaw that thanked the cashier FIVE times for the ‘privilege’ of being served by that cashier.

Not that I like rude and hate polite people, on the contrary.
But there should be some limits to the inflation of the meaning of the words that we witness every day in CA.
Every condo, townhouse, apartment, house is ‘executive’ and ‘luxury’. Everything Canadian is great (the great Canadian coffee, bagel,….) etc., our banks are the MOST prudent (and they are not), every location is great, every basement is sunny, thank you for this, thank you for that, now is the best time to buy a house, our education is great (while it is not) ….. I could go really wild here…
Who are we really deceiving?

Is it due to the fluoride in the water (I drink distilled water only) or there are very little critical thinkers that see the things the way I see them?

I participated in an interview recently, we interviewed a guy from the states, very good qualifications for the job, straight shooter, I liked him a lot, HR said: It won’t be a good ‘cultural’ fit. And that’s it.

One can’t have it both ways. To be politically correct and deliver results.
It’s like to blow and suck at the same time.

#142 Form Man on 12.27.12 at 6:49 pm

#144 smoking man

your ‘supper computer inside your coconut’ should include a spell check………

#143 jess on 12.27.12 at 7:31 pm

… it’s about human decency”.
brits angry at the use of the ‘double irish’
would people opt out of facebook?

http://www.guardian.co.uk/technology/2012/dec/23/facebook-tax-profits-outside-us accounting technique called the “Double Irish”.

Ireland, US Reach FATCA Deal Tax-News
Dec 27 – “The agreement provides that Irish financial institutions will report to the Irish Revenue Commissioners in respect of US account-holders. In exchange, US financial institutions will be required to report to the IRS in respect of any Irish-resident account-holders. This information will then be automatically exchanged by the two tax authorities on an annual basis.”

==
more signatures on this than the gunsters deport the tv host
Letter signed by 515 National and State Organizations
http://www.americansfortaxfairness.org/press/2012/12/20/515-groups-send-letters-to-white-house-oppose-territorial-tax/

http://www.salon.com/2012/12/26/the_conservapocalypse_continues/?source=newsletter

Germany ‘exporting’ old and sick to foreign care homesPensioners are being sent to care homes in eastern Europe and Asia in an austerity move dismissed as ‘inhumane deportation’
Kate Connolly in Berlin guardian.co.uk, Wednesday 26 December 2012 16.37 GMT
http://www.guardian.co.uk/world/2012/dec/26/german-elderly-foreign-care-homes

#144 Steven Rowlandson on 12.27.12 at 7:41 pm

It is time to reinstitute the minimum 25% down payment and ban borrowing the down payment.
Perhaps that will give buyers a moment of pause to consider how much they really want to pay for a property. Such a large down payment also means they have some skin in the game as well.

#145 An Importation in Quebec on 12.27.12 at 8:03 pm

Flaherty and Carney took the bet they can pump housing while awaiting for US to recover (will happen fast, in a year or so, they thought). Lost bet. Carney is leaving ship, Flaherty holds the bag…

#146 butch on 12.27.12 at 8:19 pm

So – safe to buy now, ride the market for a few more years then cash in at the new top? Or is this a non event?

#147 Mr Buyer on 12.27.12 at 8:49 pm

#144 Smoking Man on 12.27.12 at 6:10 pm
,I have no bielf system or wish full bias
……………………………………………………………..
I would say that the belief that you have no belief system is and of itself a belief system. I have found my own mind to be a tricky thing. All my efforts at deconstruction of schema’s in my mind brought with them a parallel construction of new schema’s. Something about sitting in the moment aware of my own feet and hair follicles is an inherently repugnant experience thus the warm blanket of schemas are an apparent necessity not for the intended purpose of the schema but rather the insulative effect of it. Or maybe not. I have been revealed to be horribly off the mark in many instances in the past, luckily not in the extremely serious situations so far but enough to give me pause more often then not. As far as the spring goes we shall soon see and I still remember deriding you openly last year around this time only to see a raft of nonsensical buying so I have learned my lesson. You sir on the other hand are a great deal further out on a limb this time around. You know it and I know it but I am still holding my breath. Hey did you hear the news, TO is on fire, all that pent up debt…

#148 Mr Buyer on 12.27.12 at 9:03 pm

#142 45north on 12.27.12 at 5:45 pm
Mr Buyer: I am still not going to buy at this time.

you live in Japan, no you are not going to buy in Canada!
…………………………………………………….
Actually I made a trip over to Canada for the expressed purpose of buying either a place or land only to be horribly shocked by what I saw. It is one thing to shop around on mls but quite another to look around a property. I found a place 10 minutes from parliament hill for 185k and needing 20k of upgrades after the inspection but it was in Quebec and my relations were like rabid dogs against the idea and they used to own in Quebec. I myself do not speak french even though it was my first language, but I am more than willing to learn. Apparently the medical and tax considerations are more than prohibitive. In any event we shall be between countries until the children secure native speaking abilities in both Japanese and English (French will be a second language for them). I am dedicated to this cause and property is a distant consideration relative to this. This is a very expensive proposition that is barely within my means but it will give the kids a real and decided advantage in Asia, Japan in particular and even in Canada but to a much lesser degree.

#149 Mr Buyer on 12.27.12 at 9:25 pm

#144 Smoking Man on 12.27.12 at 6:10 pm
………………………………………………………………
In my defense it appears that I may be somewhat more aware than you are of how incredibly rote I can be. More often than not the earth shaking realizations that come upon me turn out to be well worn ideas expressed centuries ago by people that lived in horrendous conditions relative to our modern life. I am not talking about insights I gleaned through reflection that turn out to be somewhat close to what some dude in a toga said long ago but seemingly original conclusions that are later revealed to be direct summaries of what others have covered far more eloquently. I did not read about it, no I thought I was a superlative student of the University of life but looking back it seems that I spent a great deal of time re-inventing the wheel (not a complete waste of time but it was time that could have been better spent).

#150 Mr Buyer on 12.27.12 at 9:46 pm

#144 Smoking Man on 12.27.12 at 6:10 pm
……………………………………………………………
I have a real world example of this re-inventing the wheel activity I have routinely indulged in as an ‘independent thinker.’ It came to me a long time ago that the mechanics of the Yeast two hybrid system depended upon an upstream promoter and then it hit me that upstream promoters may have a great deal to do with differentiation. If this were true then there must be groups of promoters, upstream or otherwise that require binding sights on the dna strand. This lead to learning the c language and then on to manipulating text files. The querying of the files became a more than prohibitive overhead that has resulted in 15 year passing and now I am learning Oracle SQL and even NOsql and see that far more complex queries are now at my finger tips and I would have been another 10 or 15 years at my rate of progress coming anywhere near approaching the capacity SQL puts at my fingertips for an investment of 3 short months learning relational databases. Sure I have a ‘felt’ understanding of relational databases due to all my unintended efforts trying to invent one but that ‘intuitive understanding’ is no more complete than the same understanding I would have had a month into production after training in SQL. It seems all my thoughts of being in secret possession of the keys to the kingdom turned out to be little more than been there done that. As a fellow psychopath that is seeing his psychopathy being steadily eroded by the march of time I share my folly for your consideration and at the very least your entertainment.

#151 Herb on 12.27.12 at 9:56 pm

#35 Thoughtful Observer,

“As he idly scratched his doctor wayne …”

Since no one has remarked on that felicitous turn of phrase, allow me be the FURST to congratulate you.

#152 Mr Buyer on 12.27.12 at 9:59 pm

#144 Smoking Man on 12.27.12 at 6:10 pm
……………………………………………………………..
As a living creature in the Universe I am indeed incredibly unique on a biblical scale when the density of life is considered relative to the area the universe encompasses. Equally true is how exceptionally common my insights and even the total expression of my entire life is relative to the density of humanity that presently exists and has come before me on planet earth. I propose you and I form the ‘been there done that club’. You can be the leader and I the admiring follower in our futile and entirely average attempts to actually be original.

#153 Mr Buyer on 12.27.12 at 10:12 pm

#144 Smoking Man on 12.27.12 at 6:10 pm
………………………………………………………….
I would like to have a proposal entered into the minutes of the first meeting of our club. I propose changing the name of the club from the ‘been there done that club’ to the ‘somebody else has already been there and done that club’

#154 TurnerNation on 12.27.12 at 11:13 pm

#154Mr Buyer

What is in your database – binders of women?

#155 DON on 12.28.12 at 12:01 am

#35 Thoughtful observer

Note just the lefties in BC oppose the Northern Gateway Disaster. About 70-80 percent do. And once you observe the terrain/ocean in person, you will see why. Besides ship the raw out east in a straight line and refine it there.

Housing is Kaput, it will need more than 50 Billion to sustain any Boom as people will now expect a future cap – it’s coming.

#156 Mr Buyer on 12.28.12 at 12:27 am

#158 TurnerNation on 12.27.12 at 11:13 pm
#154Mr Buyer

What is in your database – binders of women?
………………………………………………………………
No it is a derivative of MyGodIamAVerySlowCoderSQL

#157 Derek R on 12.28.12 at 1:01 am

#154 Mr Buyer on 12.27.12 at 9:46 pm wrote:
It seems all my thoughts of being in secret possession of the keys to the kingdom turned out to be little more than been there done that.

Yup, agreed with that, Mr B. It’s very difficult to come up with an original idea or approach unless you already know what other people have tried.

I came to the conclusion many years ago that the best way to become knowledgeable is read, read and read some more. There are so many other people trying to work out the secrets of the universe that you’ll get much further reading what they’ve come up with and then judging which of them is most likely to be right than you would if you had to work out it all out yourself.

Plus reading can tell you know where the truly unexplored regions of knowledge lie, if you really want to make an original contribution. As well as the dead ends that people have already tried.

Anyway setting that on one side, let me wish you the best of luck with your Canadian house search in 2013!

#158 Real Estate: Gov’t Delaying the Inevitable CRASH with extra $50 Billion ?!? | on 12.29.12 at 5:16 pm

[...] http://www.greaterfool.ca/2012/12/26/the-soft-landing/ [...]

#159 Geoffrey L. on 12.30.12 at 10:28 am

F is playing with the longest rope ever given to a Canadian finance minister…

#160 Brent Fullard on 12.30.12 at 11:36 am

If, as Garth points out, the start of the Vancouver spring real estate market is only a month away, I guess that means Flaherty has only 30 days to figure out who to blame? Maybe Carney would be a good fall guy to hang this pending disaster on, now that he’s become expendable?

#161 ElNik2013 on 12.30.12 at 2:45 pm

I see so many here blaming government and with good reason. Government intervention is responsible to a large extent for the booms both in the US and other countries, including Canada. However, I’d like to see more blame put on the sheeple who go along with these policies which are very harmful to ALL (buyers and renters) in the long term. Not many here seemed to have been dumb enough to fall for the gimmicks, I know I didn’t, so how come so many did fall for these tricks, but we didn’t? We’re all living in the same country yet some of us don’t make stupid mistakes? Well, actually, they’re “smart” mistakes because we all know that those who had nothing to do with the bubble will be FORCED to bail out those who behaved irresponsibly….so basically, they’re the smart ones and we are the dumb ones…the joke’s on us folks.