Careful

careful1

Jason and Maria are young thirtysomethings who, like most, lust for a house. Four weeks ago they did something they instantly regretted, which this time had nothing to do with blue berries or udder cream.

Per usual, they spent Sunday going to open houses in and around their Kits hood in Van, then fell in love with a place listed just under a million. Of course they couldn’t really afford it, but that never stopped coursing hormones. By the next night they’d contacted the listing agent, drafted an offer and submitted it. The deposit was $15,000 – part of a downpayment they figured would be $50,000 – and they handed over a cheque when the realtor asked for one. Make it certified, he suggested, since it shows you’re serious. They did.

A day later they’d done some heavy budgeting, gone to the bank to visit their loans officer and, most seriously, emailed me. “Maria really, really wants this house,” Jason explained, “but after thinking about this and doing the numbers, we’re a little scared. Do you think we should just walk away and, like you say on the blog, wait a year?”

Of course you should walk, silly hormonal, self-destructive, irrational people, I said, letting my feminine side show through. Just tell the agent to stop payment on the deposit cheque before it’s cashed and before the vendors have a chance to sign back.

Unknown to me, the sellers immediately accepted the deal, and the deposit cheque had been certified. So when Jason called the agent – less than 24 hours after signing the offer, thinking that he could back out during a “cooling off’ period – as is the case in BC and other provinces with condos (usually seven days to exit) – he was shocked. “You bought it,” he was told. “Congratulations.”

And they did. Closing’s in seven weeks. They’re freaking.

What did the kids do wrong?

First, getting porned up on realtor.ca and then cruising open houses. That’s a given. Second, even contemplating making an offer without having an agent of their own to represent them, protect them and guide them. An experience realtor in a declining market devoid of multiple offers would know purchasers need never cough up certified funds to present with an offer. Plus, he would have suggested an offer with subject clauses providing several escape hatches.

Sure, in hot markets it’s often impossible to have a conditional offer accepted, but those days are gone. Now nobody should  be handing over paper to vendors which doesn’t contain at least a home inspection clause and, preferably, one making the offer null and void if the purchaser is unable to secure exactly the kind of financing wanted within a few days.

That means no funds change hands until the conditions are removed by way of a waiver the buyers sign. At that point it’s a binding deal, and the purchasers are obligated to hand over the deposit. If they don’t, they’re open to potential legal action – which is unlikely to materialize.

The contrast with what Jason and Maria did (or a similar example which was cited in the Toronto Star some days ago) is stark. Once deposit money has changed hands, good luck ever getting it back. No matter if you chicken out, can’t close the deal or lose your job, those funds are probably gone, simply because you entered into a contract and then abrogated it.

Sure, you can sue for its return, but the courts will almost always rule against you, even if the property sells again to new buyers for about what you offered. Contract law’s clear. The party breaking the contract has caused damages to the other party, and pays for it. Most importantly, there is no cooling-off period when buying a resale home, which is why you need an agent ethically bound to represent your interests, or a lawyer to review the offer in advance and advise.

So, here the lessons. Establish a relationship with a trusted agent before you go to any open house, call on any listing, or make an email inquiry. Make it known. Don’t proffer an unconditional offer, ever, unless you’re 100% ready to close the deal. Don’t certify a deposit cheque unless it’s money you don’t need. Always try to solicit a sign-back from the vendor, either by adding in conditions he doesn’t want or lowballing the price. This now becomes an offer to you from the seller, giving you time to think and react.

Most of all, wait. Sure, there are some markets already descending into distress, but the process has just started. After this Spring market’s passed, buyers will rule. So, chill. Revenge is best served cold.

234 comments ↓

#1 Hoof - Hearted on 01.27.13 at 4:57 pm

Fiiirssszzztttt

PS Dr Wanker ahahahah

#2 Ronaldo on 01.27.13 at 5:01 pm

Garth, since all the elements of a contract appear to be in place. Offer, acceptance and consideration. If the seller cannot re-sell for the price that this couple accepted, could he sue them for the difference?

Yes, and often successfully. — Garth

#3 Dog Walker on 01.27.13 at 5:01 pm

Congratulations! You are no longer a low life renter, but a respected mortgage/property tax/maintenance/bubble maintainer!

#4 ralph tieleman on 01.27.13 at 5:02 pm

Hi Garth, real estate pretty slow here in Tofino….assessments are down again…sales are tanking….hope all is well…..Ralph Tieleman

#5 NotaGreaterFool on 01.27.13 at 5:05 pm

Sad story.

BTW, anyone find any media coverage in the case of the Competition Bureau vs. CREA/TREB? When is a verdict expected?

#6 Innumeracy chick...No more(AKA AMAZON) on 01.27.13 at 5:11 pm

Trying to break out of the cave…wondering if I have enough RRSP’s to cover my mortgage balance would a mortgage inside my RRSP with Intrest rates going up make any sense. Garth is rolling his eyes I know i did it all wrong..I put into rrsps and paid down my mtg. I opened the tfsa today a few years late.

#7 Buy? Curious? on 01.27.13 at 5:12 pm

Holy cow! I didn’t even read the post!

I’m sure it’s great but I’m usually 47th or 69th because of my schedule.

Garth, Thank you for posting as often as you do. I’m a goof but I have learned more from this blog than I ever did in High School and University.

http://www.youtube.com/watch?v=YYjBQKIOb-w

Ladies, lycra is a way of life.

#8 Fleabitten Monkey on 01.27.13 at 5:12 pm

Pray for the young and hormonal. How can ANYONE justify putting down a cash deposit of $15,000 which will be $50,000 in total, with the expectation of having a mortgage of lets just call it $900K….and…..THEN…..do the heavy budgeting to determine if they can afford it?

#9 Werner Patels on 01.27.13 at 5:17 pm

This is such a sad story… and an expensive lesson for this couple. All I can say, again and again, after having owned condos and a house, home ownership is overrated, and in this day and age, marked by uncertainty galore, not owning is definitely the smarter way of doing things.

#10 craple smaple on 01.27.13 at 5:19 pm

Don’t bother with an agent. You just need an experienced lawyer and half a brain. We bought our last two houses without an agent and sold our last house without an agent. No problems, saved money.

How would you know without comparables? A buyer’s agent costs zero. Why not employ one? – Garth

#11 Buy? Curious? on 01.27.13 at 5:19 pm

Ok, I just read your post. Holy cow. It must suck to be stupid. I know I’m mentally immature, unmanageable and can’t deal with with authority but, like Dave Chapelle said, “I’m Rich, Bitch!”

In all honesty, I’m luckier than I am smart.

http://www.youtube.com/watch?v=9zueKq3z3Sk

#12 Andrii on 01.27.13 at 5:23 pm

How about absolute cansellation right?

Fair trade act do not work at this case ?

Huh? — Garth

#13 prairie person on 01.27.13 at 5:28 pm

I wish you were able to look at the outliers. If the fall in prices continues, I think places outside of the major cities will take a tumble. Here’s a condo for sale in a small Manitoba town. The builder, Lakeview Hotel, added a bunch of condos to the north side of the hotel. None have sold. Instead, the units are all rented. The price, to me, is shocking. You can buy a bigger condo in Victoria for less.

Unit 2003 is 470 square feet, with a full Lake-View and includes one full balcony.
The Condo has 1 Bedroom and 1 Bathroom.
Unit Price is $189,900 floorplan-2003

There are a lot of towns in Canada with lakefront and a lot better weather than minus 40.

#14 DJB on 01.27.13 at 5:32 pm

Apple needed buyers at $650 $600 $550 $500 also, I bet those buyers all had remorse too..

In fact there is close correlation between the mania behind Apple stock and Vancouver R/E.

#15 jake on 01.27.13 at 5:32 pm

Hi Garth – Are you open to personal coaching? Can I pick your brain over coffee some time?

#16 Innumeracy chick...No more(AKA AMAZON) on 01.27.13 at 5:38 pm

Buy? Curious? saw too much spandex last night at roller skating…yes its still alive along with classic rock!

I am talking the twentysomething girls at work out of buying homes right now. When I was that age I walked through 400,000 dollar homes wishing I could afford one now they are a million and the young have no trouble plunking down a deposit??? their arguement their income has no where to go but up as they are both professionals??

#17 Rob on 01.27.13 at 5:40 pm

Well said, Garth. As a Realtor who has represented Buyers almost exclusively and talked some of them out of buying houses they were in love with but blind to serious faults or over-pricing, I can’t say enough just how important it is to have an ethical Realtor represent you when buying. That said, the Buyer needs to be confident this Realtor will represent his/her best interests and not be motivated just by the commission. Ask for a list of a recent clients he/she has represented in deals. Ask for a consecutive list (not ones the Realtor selects that went well but the last 3 or 4). Check the Realtor’s website and ads…do they reassure you or do they just suggest you should buy no matter what? Best of all, ask any of your friends/acquaintances about Realtors they may have used..there is often a big difference between the image presented in the advertisements and the reality of what the Realtor will or won’t do for a Buyer.

As for Jason and Maria, they may wish to find a Realtor they can trust and show him/her the Contract of Purchase and Sale they signed. Was there some “agency” offered by the Selling Realtor? Were the “agency” options properly and thoroughly explained? Was the Contract of Purchase and Sale (offer) done correctly? If some “agency” was offered, did the Realtor do the duties required by that “agency”. Was all the contract and “information” paperwork done correctly? Worth checking out!

NEVER buy a property without a Realtor representing you unless you are VERY knowledgeable about prices, comparable values, market direction, etc.

#18 [email protected] on 01.27.13 at 5:43 pm

Re: jake…depends are you m or f?

#19 Andrii on 01.27.13 at 5:47 pm

How about absolute cansellation right?

Fair trade act do not work at this case ?

Cancelling a Contract – Ministry of Consumer Services

#20 David on 01.27.13 at 6:04 pm

#11 Buy? Curious?

I’d say it’s better to be lucky than smart.

Of course one needs to be intelligent enough to recognize when one has been lucky to avoid undoing that luck.

#21 Buy? Curious? on 01.27.13 at 6:05 pm

Innumeracy Chick, how did I know you’d respond to my post?

#22 Old Man on 01.27.13 at 6:13 pm

The original purpose of a payment with an Agreement of Purchase and Sale was to execute a contract; no more or less, as just $1.00 would be enough, but usually was $1,000.00 years ago for presentation, and now one wants a certified cheque with a substantial amount to show good faith? Again, the sole purpose of a deposit cheque on any offer is to make a contract legal.

I will give you an example with client and attorney priviledge, as just $1.00 with a receipt from the attorney seals the deal with a discussion about any case, as what is said becomes protected in the inital phase.

#23 Kam on 01.27.13 at 6:20 pm

A buyer’s agent costs zero. Why not employ one? – Garth

5% commission [buying and selling] is already included in the selling price.Seller does not pay anything out of pocket. Commission comes out of buyer’s pocket.

Sometimes listing agent agrees to offer 2.5% discount if the property is in the market for long time, but most of the time listing agent will ask you to make him/her as buying agent.

Most of selling agents will agree to give only 1% discount if you will buy the property without buying agent.it is hard to get 2.5% discount, but as we are entering into buyer’s market [assuming G's prediciton will be right] chances are buyers will be able to save 2.5%.

There is no risk.Hire a good lawyer.Put all the standard conditions inspection,financing etc.Show the offer letter to you lawyer before you fax it to listing agent.Hire a good inspector for property inspection.

One of the listing agent asked me to sign the following
document when i put an offer without agent and declined to hire him to be my buying agent:

confirmation of cooperation and representation which indicates that the Listing Brokerage represents the interests of the Seller and that you have been provided with the agency documents and decline to sign.

#24 pathcontrolmonk on 01.27.13 at 6:22 pm

A house in Kits for under a million is a steal. They should install some granite countertops and relist it for 30% more.

#25 Freedom First on 01.27.13 at 6:28 pm

Ouch! Painful lesson for Jason and Maria. This is an extremely common affliction nowadays though. Making a decision about something before becoming fully aware/educated as to all of the information one must know before making an INFORMED decision. Age/education has nothing to do with this line of thinking though. It is a time developed habit of operating out of your mind, basing one’s thinking/decisions on their assumptions, assumptions which are backed by having zero knowledge/facts about the situation. This worldwide epidemic of arrogance/ignorance/idiocy, has, and is, causing millions of people to lose billions, if not trillions of $$$. First lesson from your mommy has been forgotten: “Look both ways before you cross the road”.

Getting informed advice is always good, as for myself, before I ever bought my first property, made my first investment, or even bought my first car, I read everything about handling my finances that I could get my hands on. As I said before, I realize now, through tragic circumstances, I have been self supporting since I was seventeen. I have never suffered from self-pity. I am just very grateful I took the path I did. Work, study, and learn everything you can about everything in life. Ignorance is not bliss, it will destroy you. As will arrogance. Garth, bless you for this free blog. To the readers, listen to Garth as he is wise, and free:)…..and if you don’t believe anything Garth says, then at least stay open minded and thoroughly research what he says. Do that, you can’t lose. Open minded=informed. Closed minded=ignorance/arrogance/idiocy/sloth/MIL

#26 Old Man on 01.27.13 at 6:30 pm

In the Province of Ontario the Registrar was a drunk, and was feared by all, and his name was Cox. One day he called me saying I have you now, as knew you were never clean, as have evidence that all over the City of Toronto you are paying kickbacks to Real Estate agents.

I said tell me more. They all have cheques for $25.00 and he called me a crook, and said those cheques are to legally commit any client on a VTB second with me with their client to go firm with my forms. Cox said wtf as am confused by this all, but will get you another day, as just know you are not clean.

#27 Innumeracy chick...No more(AKA AMAZON) on 01.27.13 at 6:32 pm

Buy? Curious?
More eye rolling from garth! I don’t peg him as the cupid type.

You started it.
Do you have comment on mtg. within rrrsp? Oh right your too honest what was I thinking..

You did say so yourself

#28 Nonno Nicola on 01.27.13 at 6:44 pm

fugetabutit, nonno nicola is a gonna buy a nice semi detache today, the price is a right and the backayard is nice and a big for the tomato.

nonno hasa been away fora while but i see the same carater are stila round, the man who taka lot a farmaci how you say smoking man, he still sayinga lotsa stupida thing and no maka sense. But my amico biga rida still nota buying the realesteta, i scared for the future of biga rida.

#29 Grim Reaper/Crypt Speculator on 01.27.13 at 7:06 pm

Latest Text on my Samsung from Steve Jobs :

Greater Fools are those that sell….

They don’t make any more land…therefore prices can only go up.

Also WINDOWS XP is all you need….

#30 45north on 01.27.13 at 7:19 pm

NotaGreaterFool: Sad story

yeah it is

in the case of the Competition Bureau vs. CREA/TREB? When is a verdict expected?

yeah when?

pathcontrolmonk: A house in Kits for under a million is a steal. They should install some granite countertops and relist it for 30% more.

if Jason was my son or Maria was my daughter, I’d say walk. Or how about you (pathcontrolmonk) contact me and see if I can hook you up?

[email protected]

#31 EIT on 01.27.13 at 7:31 pm

Free investment advice for everyone:

“When the horse is dead, remember to get off”

#32 This is Wonderland on 01.27.13 at 7:42 pm

I would love to know what these two are earning that they can carry a mortgage with only 65 thousand down on a million dollar home, where are they getting the rest of the cash? There has got to be more to this story, who exactly is allowing them to borrow the rest?……Am I being naive to think that these two must be making a combined income of 200 000.00 or more to have a reputable bank even talk to them about a mortgage this size.

#33 not 1st on 01.27.13 at 7:53 pm

teetering market..check
horny know-nothing DINK couple…check
barely affordable property to fall in love with….check
forget new mortgage rules or rising interest rates…check
offer made without conditions..check
upfront money provided before offer accepted….check

Congratulations, you have just been awarded the greater fool award which Garth will deliver to you in person and hopefully give your dumb asses a boot for good measure.

#34 dosouth on 01.27.13 at 8:04 pm

Oh, you mean like the post you just made? I get it now. — Garth

Exactly!!

#35 n1tro on 01.27.13 at 8:06 pm

To Jason & Maria:

Jason, you should try to grow a pair instead of letting your wife whip you into buying an overpriced house which you can’t afford. The sad part is, you knew what Garth has been saying before you bought. So cry me a river to an other idiot who wants the wife and agrees to do something stupid.

#36 Proud Musty Basement Dweller (WestCoast) on 01.27.13 at 8:17 pm

Garth, do you really think another real estate agent in the mix, (supposedly on Jason and Marias side) would have protected them. My sense is they may have fanned the hormonal fire and encouraged the sale.

#37 Dr. WAYNE on 01.27.13 at 8:17 pm

#1 Hoof – Hearted on 01.27.13 at 4:57 pm

Fiiirssszzztttt

PS Dr Wanker ahahahah

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

What’s so funny … you’re the unmitigated a$$hole …

#38 InvestX on 01.27.13 at 8:21 pm

Garth, on the previous post you responded to a commenter with:

“Earning dividends inside a TFSA means loss of the dividend tax credit. — Garth”

I thought the TFSA was a tax shelter? In the past you wrote of TFSA’s:

“…neither is there tax when you take it out. Every cent you contribute, and all the growth earned over the years, is yours to keep.”

I’m confused. Please clarify?

No tax, no dividend tax credit. — Garth

#39 Proud Musty Basement Dweller (WestCoast) on 01.27.13 at 8:26 pm

possibly Im dense or missed it but where did the blueberries and udder cream come in in the end

#40 Old Man on 01.27.13 at 8:35 pm

#31 EIT – am going to write that down as a classic, as am still laughing.

#41 Dr. Hoof-Hearted on 01.27.13 at 8:35 pm

Dr Wanker..

Be advised:

My nom de plume as changed

#42 Ken R on 01.27.13 at 8:44 pm

#32This is Wonderland on 01.27.13 at 7:42 pm

“I would love to know what these two are earning that they can carry a mortgage with only 65 thousand down on a million dollar home, where are they getting the rest of the cash? There has got to be more to this story, who exactly is allowing them to borrow the rest?……Am I being naive to think that these two must be making a combined income of 200 000.00 or more to have a reputable bank even talk to them about a mortgage this size.”

Doesn’t matter how much they make, 900k is too much to pay for a roof over your head unless you are a professional athlete, or have some other means of excessive income that the rest of the public only dreams about.

#43 Mark on 01.27.13 at 8:46 pm

A buyer’s agent costs zero. Why not employ one? – Garth

Having sold a home in eight days using Property Guys I can assure you that statement is untrue. The two times agents wanted to bring clients through the house my response to them was the same, essentially I know my price, they can pay you, I won’t.

I wonder how much that cost you in lost competing bids. Cheap can be expensive. — Garth

#44 Cory on 01.27.13 at 8:48 pm

only a realtor would take advantage of people like this. Deal with used car salesman, it’s much more pleasurable.

#45 Paully on 01.27.13 at 9:09 pm

I have always thought it interesting that RE agents all suggest a 5% deposit, certified. That way, they already have the commission in their trust account, regardless of what happens to the deal.

The deposit amount is 100% the choice of the buyer. — Garth

#46 Daisy Mae on 01.27.13 at 9:13 pm

“How would you know without comparables? A buyer’s agent costs zero. Why not employ one? – Garth”

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

Right. It’s the SELLER that pays the commission….unless the buyer signed a BRA.

OMG….!

#47 ozy - Get the money back on 01.27.13 at 9:15 pm

If the agent implied to bring certifed, they have lost the $ for signing like blind, but can’t they sue her for negligence or lying if she said “Make it certified, since it shows you’re serious” ? Is this possible?, so they get let’s say 50% back from the misleading part?
Beeeee, what country is this anyway?

Even you (mighty allmighty Garth) saying “After this Spring market’s passed” —what that thing, another delay? Earlier was said market is already 10% down from last spring? Is now bouncing back? Beeeee, what country is this anyway?

Too many lies, trust no one, especially your friends asking for a $1000 loan :) :) :) :)

#48 AK on 01.27.13 at 9:16 pm

#1 Hoof – Hearted on 01.27.13 at 4:57 pm

“Fiiirssszzztttt”

No wonder. You have been posting nonstop the entire weekend.

Congratulations are in order. :-)

#49 T.O. Bubble Boy on 01.27.13 at 9:17 pm

@ #38 InvestX on 01.27.13 at 8:21 pm
Garth, on the previous post you responded to a commenter with:

“Earning dividends inside a TFSA means loss of the dividend tax credit. — Garth”

I thought the TFSA was a tax shelter? In the past you wrote of TFSA’s:

“…neither is there tax when you take it out. Every cent you contribute, and all the growth earned over the years, is yours to keep.”

I’m confused. Please clarify?
__________________

Dividends in a RRSP will be taxed as income (full income tax rate) when eventually withdrawn.

Dividends in a non-registered account get the Dividend Tax Credit, which essentially cuts the tax rate on those dividends in half (depending on your tax bracket).

#50 T.O. Bubble Boy on 01.27.13 at 9:24 pm

It seems crazy, but the skinny McMansions of North Toronto keep on selling, even in the January snow.
These are all on 25ft lots that used to have bungalows or basic 2-storey homes – then the original home is torn down and built into a 3-storey stucco cookie-cutter “new build”.

How many people have $1.5M sitting around to buy these 22ft wide faux palaces?

Is this offshore money? Or, people trading up from their $800k-$1M “traditional” house to a newer McMansion?

Anyone know someone who has bought one of these places?

#51 Daisy Mae on 01.27.13 at 9:24 pm

#17 ROB: “NEVER buy a property without a Realtor representing you unless you are VERY knowledgeable about prices, comparable values, market direction, etc.”

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

Garth, what have you done? Opened a can of worms?
Another ‘DA’?

#52 Canned Goods and Buckshot on 01.27.13 at 9:25 pm

A buyer’s agent costs zero. Why not employ one? – Garth

A seller not using an agent will be more open to a negotiated price when the seller is not shelling out 2.5% each to the respective realtors.

Sold twice without realtors and once with. Regretted the realtor transaction.

Buyers beware: in realtor assisted transactions there are actually 4 parties involved. Seller, buyer, seller’s agent and buyer’s agent. 3 of those parties are up against the buyer. They all want you to buy. Buy! Buy! Buy! They all benefit from the purchase and the buyer’s agent who puts the client’s interest before their own is a rarity.

Not my experience, and I have bought/sold dozens of times. — Garth

#53 betamax on 01.27.13 at 9:27 pm

Jason, welcome to a state of indentured servitude.

You’re likely underwater as we speak. Hope you enjoy the house as you toil forever to pay for the seller’s easy living. Think of yourself as a philanthropist — that might lessen the sting. But probably not.

#54 ozy - See Article below, many lost the train, I am sorry and I love you on 01.27.13 at 9:28 pm

Neighbourhood Change > The Three Cities Home
http://3cities.neighbourhoodchange.ca/

See 3rd article especially called:
Neighbourhood Polarization since 1970: Three distinct cities emerge in Toronto

Worth a cry. Middle class ripped-off, upper-class profiting, lower class expanding with most of former middle-class. If your neighbor house is not worth 1 mil, you lost

#55 Not a question about cross dressing! on 01.27.13 at 9:34 pm

Garth,

Question with a BRA.

How “free” is free when dealing with a buyer’s agent. If I am signing an agreement in Ontario with a BRA (Buyer’s Representation Agreement) that gives the buyer’s agent a guaranteed commission, how do you know you won’t be paying out of pocket when you have no clue what the seller is willing to pay?

Question without a BRA.

Assuming you can get a good agent to work with you without a BRA, can you contract an agent to represent you, but have them work out their commission based on the purchase price of the home?

You do not need to sign a BRA. The seller’s agent is bound by law to share the commission with your agent, BRA or not. — Garth

#56 Country Girl on 01.27.13 at 9:37 pm

Jason & Maria,
Perhaps a plea of insanity would be appropriate to get you out of this deal.

#57 ChickenLittle on 01.27.13 at 9:38 pm

Proud Musty Basement Dweller (WestCoast) on 01.27.13 at 8:26 pm: possibly Im dense or missed it but where did the blueberries and udder cream come in in the end?

That’s in Garth’s other “how to” book…

I was already feeing stressed out enough tonight about all the work I have due tomorrow and this post made it worse. How could anyone be that stupid? That’s a MILLION dollars (well, almost)!!!!!!! Am I missing something here? HOW the HELL did they think they were going to pay for that?!?

#58 Dr. Hoof-Hearted on 01.27.13 at 9:49 pm

Listen to Garth

Basic LAW should be a required course in High School.

Learn the concept re Contract Law “Offer and Acceptance”….

Anyone that doesn’t have the savvy to put in weasel clauses like “Subject to_____________________________________________________________________________________________________________________________________” is a potential Dr. Wanker…err ” $tupid A$$hole”.

#59 Devore on 01.27.13 at 9:53 pm

#245 TEMPLE

Devore, I am not sure what fees you mean when you mention stocks. There are no management expenses per se for stocks, and certainly no fees that are taken directly out of stock holdings.

What I mean is that a public company spends money, including through dividends, (or sells assets) which affects the value of its assets, and thus the price of its shares (or, yes, dilute shareholder value, hopefully temporarily, by issuing more shares to raise capital). Nothing to do with trading. They might overpay for an acquisition, or firesale one of their divisions (HP does this all the time). If Apple were to spend a billion on R&D on a product that goes nowhere, you bet that will affect the stock price.

It was just a general observation comparing mutual funds to stocks, and that value can be drained from a fund in a way that need not show up directly on your statement.

#60 Country Girl on 01.27.13 at 9:56 pm

#19 Andrii on 01.27.13 at 5:47 pm
“Cancelling a Contract – Ministry of Consumer Services”

Thanks for providing this potential lifesaver for Jason & Maria.

#61 Richard and Zeus on 01.27.13 at 9:56 pm

“I would love to know what these two are earning that they can carry a mortgage with only 65 thousand down on a million dollar home, where are they getting the rest of the cash? There has got to be more to this story, who exactly is allowing them to borrow the rest?……Am I being naive to think that these two must be making a combined income of 200 000.00 or more to have a reputable bank even talk to them about a mortgage this size.”

Probably useless tax sucking govt workers with guaranteed income and guaranteed pensions while the rest of us in the private sector make 1/2 of much with no pension and are forced to live in condos if we want to live in Moldcouver…….just my guess. Rights Zeus ??”BARK”…good dog !!

#62 think again on 01.27.13 at 10:01 pm

Unfortunately these people likely spend more time determining where to vacation then how to spend $900k…

#63 Tim on 01.27.13 at 10:03 pm

Anyone that stupid shouldn’t be allowed to have a bank account

#64 Devore on 01.27.13 at 10:11 pm

Inspection and financing are standard conditions on any offer, that much goes without saying. If you’re the only bidder on a house, there’s no reason to make it unconditional.

But really, what were these expecting? What did they think was going to happen? Going to open houses every weekend? That’s like two young, horny, inexperienced teenagers necking, before you know it clothes are flying everywhere, condoms, protection, what’s that? When hormones and emotions are flying, things tend to escalate quickly. And in life there are consequences. There’s no redo. That’s why we research, prepare, do the math, set limits, make a plan, distance ourselves, and hire professionals to help.

So, congratulations, you bought yourself a Kits crap shack, or lost 15 grand, plus whatever the sellers/realtor will choose to come after you for if you walk.

#65 Victoria Real Estate Update on 01.27.13 at 10:12 pm

Welcome back Victoria people. I am a Victoria girl in her 20’s. I will be trying to make regular contributions to this blog to share what we have learned about the Victoria housing market. We almost bought a house a couple of years ago, but luckily we decided to wait for prices to correct because that is exactly what they have done. If we would have bought in 2010 or 2011 we would owe way more on our mortgage than what we could sell the house for now.

Now we are laughing because we can watch house prices decline while we continue to save money. Renting is great. I feel so bad for our friends who bought in the last 3 or 4 years in Victoria. They are now under water on their mortgages and they are so stressed out as they watch prices go lower. They wish they could be renting right now like we are. They can’t get out of their mortgages without it costing them a lot of money.

We did a lot of research about the houisng market starting about 3 years ago. Luckily we were able to find all the information we needed to make the right choice which was to hold off from buying at bubble prices. Real estate boards normally have very biased opinions, so we started to search for information elsewhere and we found a lot.

In the past 5 to 6 years many countries around the world experienced housing bubbles just like Canada. In every case, the bubbles burst and major corrections happened. The US is only one example of this.

This Miami house was valued as low as $175,000 after having peaked at $445,000 in early 2007.

Victoria’s correction will be a big one and it will take more than a couple of years to play out. It will be worth waiting for lower prices.

Girls, I know you want that house right now, but renting will also work as prices come down. Guys, I know you want to impress your girl, but there has never been a worse time to buy in Victoria, in our opinion, and you will be much better off to wait for lower prices. When you do buy in the future, you will look very smart for buying at the right time.

Until next time – cheers!

#66 Squish on 01.27.13 at 10:14 pm

This makes my stomach ache. Honestly, how… HOW do you make such a massive decision without the slightest thought, just because you really want it (since yesterday)? Why are you even LOOKING at houses without having determined some sort of price range, based on what you can actually afford, you know a budget?

This story is really upsetting. I feel awful for them and at the same time angry at their stupidity, and innate sense of entitlement. Surely this is the peak of craziness.

#67 Ronaldo on 01.27.13 at 10:20 pm

THE BABY BOOMERS

An interesting essay written by Diane J. Macunovich, Dept. of Economics, Barnard College, Columbia University, New York, NY October 2000

http://bulldog2.redlands.edu/fac/diane_macunovich/web/baby_boomers.pdf

http://bulldog2.redlands.edu/fac/diane_macunovich/web/baby_boomers.pdf

#68 Bo Xilai on 01.27.13 at 10:25 pm

I can’t believe ANY agent (hot market, cold market, inexperienced, blind, deaf or dumb) would let his/her clients write up an offer without inspection and financing clauses.
I would argue it’s professional incompetence, but then again, the buyers’ agent probably had visions of having his Mercedes lease payments paid off for the next year.

That has been the norm in Toronto and Vancouver during competitive markets. Sellers refuse offers with conditions. — Garth

#69 Old Man on 01.27.13 at 10:26 pm

#62 think again – let us all keep our vacations in Canada to boost the economy, and in Ontario my place will always be the Cleveland House, as have been going there since a child; so much class there, and a fun week or two.

#70 Bo Xilai on 01.27.13 at 10:30 pm

Sorry, missed the part where the two thirty-something numbnuts contacted the listing agent with the offer… Then again, if the listing agent is getting “double-ended” commission, doesn’t he/she have a standard of care to the buyers as well?

#71 waiting on 01.27.13 at 10:32 pm

I just checked listings on mls and there are no listings for houses under 1 million anywhere in Kits so that means they’ve bought a townhouse or condo or unit in a duplex or triplex. You’d be hard pressed to find a lot for under a million on the west side of Vancouver. It looks like they didn’t really do any planning at all – just made an impulse buy like buying a pair of shoes … Very sad – It will be an impulse buy they will have to live with for a very long time. I’ve bought two homes over the years from “for sale by owner”s and have never sold without a good agent. I tried to talk a colleague out of selling his house to a neighbour (without either having agents) a few years ago in a very hot neighbourhood. they were both happy to save commissions but I thought he sorely underpriced it and two years after selling it, comparables went for $250,000 more. You’re right – a good agent makes a big difference.

#72 Cici on 01.27.13 at 10:33 pm

#25 Freedom First

Good message – so cute and true.
Great advice, good for you!

#73 My thoughts on 01.27.13 at 10:37 pm

Did the open house thing today. Amazed by the pumping of realtors. Learned that one of the realtors that wouldn’t even consider my offer (because her owners are rich and could afford to sit on the property forever) is selling her own property! What’s with all te agents selling. Another agent sold her high end home and down sized. Some lucky people’s homes were purchased by greaterfools. So many listings being relisted with lower prices and the agents say.. Oh it’s going to be a good spring??? Amazing really. My favorite line of the day. Oh… We know its going to sell for this price because we have already had offers. Offers that fell through on the condition that the buyers sell their homes, etc. well agents, it didn’t sell… So the only reason this is continuing at 100+++ days on the market is because of people’s stubbornness. Actually to me today was a complete turn off in theGTA. There’s no point even looking until the fall.h The price drops and days on market are obvious even to an amateur like me. There are greater fools getting in the market… But can they get out like the greater fools in our example. Thanks for to the post Garth. Really put today in perspective!

#74 CalVulture on 01.27.13 at 10:42 pm

“Now nobody should be handing over paper to vendors which doesn’t contain at least a home inspection clause and,…….”

This is great advise but…

A better idea is NOT to hand over ANY papers to anybody making ANY promises.
Monster lawyers I work for, will inspect the home first THEN enter in a contract using their own realturd.

This avoids numerous legal entanglements that can corner you in making a purchase you are regretting.

Home Buying Recipe:

1. Find a trustworthy realturd (good luck)
2. Find an independent home inspector. One that does not work for realturds or depends on future business or referrals from realturds.
That means you should get referrals and interview inspectors as to their qualifications, experience..etc.
3. Put the pieces together and establish a cost of repair schedule. Get a clear picture of what you are buying.
4. THEN make the offer.

Avoid the realestate trap. I’ve seen clients regretting their choice midway through an inspection and discussing their ‘walking’ stragety.

Kick the tires first …..then make offer….

And whatever you do, trust your instinct, read this blog…

#75 Cici on 01.27.13 at 10:45 pm

# 37 Dr. Wayne

C’mon, Dr. Wayne, just forget about Furst / Hoof-Hearted and the rest of them…like the rest of us.

They are annoying, but totally not worth the time, attention and anger.

Just contribute more worthy dialogue already!

#76 ChickenLittle on 01.27.13 at 10:46 pm

http://www.huffingtonpost.ca/2013/01/27/mobile-living-vancouver-van-dwellers-housing_n_2560651.html?utm_hp_ref=canada-business&ir=Canada%20Business

and….

http://www.theatlantic.com/business/archive/2013/01/the-biggest-housing-bubble-in-the-world-is-in-canada/272499/

Crazy….

#77 2centsCdn on 01.27.13 at 10:49 pm

Those sellers should kiss the ground every day … it’s not often less than bright (“stupid” seems so harsh) people can get access to nearly a million dollars and go shopping. Lucky lucky sellers ….. a real estate agent doing his or her job (working for the sellers) ….. and the buyers? … well they will pay (and pay and pay). Hmmmm … 40%+ of their gross income to the government, and 60 – 70% of whats left to the mortgage. That has to get un-fun very quickly.

#78 Chris on 01.27.13 at 10:52 pm

Having a TRUST-WORTHY buyer’s agent is the key. I’ve heard of a buyers agent manipulating his client into a contract with no room to back-out. My own agent also locked us into a restrictive BRA (not a home purchase contract, thank God) – That lesson tied our hands for a few months, but at least cost us no money.

Since then I’ve learned:
Be it a contract or a burning building, NEVER GET INTO IT WITHOUT KNOWING EXACTLY HOW YOU CAN GET OUT. The simplest is to have “I walk, no questions asked” exit clauses for your protection, which are typically part of home purchase agreements at along with home inspection & financing conditions.

#79 Cici on 01.27.13 at 10:53 pm

#38 InvestX

In case you didn’t understand Garth’s answer…dividends are subject to special tax credits, which are cancelled out by investing them into TFSAs.

In other words, if you put dividend-earning investments into your TFSA, the interest doesn’t get taxed, but you don’t get a tax credit either.

So: Put any investments earning interest (but no dividends) into your TFSA = No tax on interest income.
Put dividend-earning investments into non-registered accounts (i.e.: no RRSPs, no TFSAs), then you can write off the dividend income.
Hope that’s clear.

#80 john on 01.27.13 at 10:53 pm

You do not need your own agent when buying a house. If you like the home buy directly from the listing agent. If a house is listed at 850,000 and you go direct and offer $825,000, the net after commission (2.5% only since only 1 agent) is 804,375. In contrast if you have your own agent and make the same offer of $825,000, the net after commission is (2.5% to the listing agent and 2.5% to the buyers agent from the sellers) is 783,750. I can assure you the seller will not accept your offer of 825,000 through your agent however they will accept your 825,000 offer if you go direct to their listing agent.

False. The seller’s listing agreement stipulates the commission to be paid, regardless of how many parties ultimately share it. — Garth

#81 Devore on 01.27.13 at 10:54 pm

#47 ozy – Get the money back

If the agent implied to bring certifed, they have lost the $ for signing like blind, but can’t they sue her for negligence or lying if she said “Make it certified, since it shows you’re serious” ? Is this possible?, so they get let’s say 50% back from the misleading part?

Sue for what, telling the truth? Yes, it shows “you’re serious”. It is also completely unnecessary. If this suit had any merit, Future Shop extended warranty salesmen, engine-cleaning fuel additive peddlers, and ColdFX manufacturers would be out of business overnight.

Truth by omission. 100% legal.

#82 Smoking Man on 01.27.13 at 10:57 pm

Yoda I’m running out shite too talk about.. Don’t wana start sounding like a broken record, regurgitation of the same is worce than death to an artist………

Use the force, I need inspiration…..

#83 TomOfMilton on 01.27.13 at 10:58 pm

I’ve sold a 1974 townhouse a year ago and I’m now renting one of the first new waves of housing in Milton.
I use to think construction was cheap n dirty in the 70’s.
However, that townhouse was a comfortable dream compared to the trash they throw up in these “new” neighbourhoods. The one we rent has outrageously creaking floors and the very worse insulation of any home either of us have lived in. Every floor in every room with a front or back wall is stone cold. They actually didn’t even connect a bathroom heating vent in the master bedroom. I don’t think I could have found all the problems even with a home inspector, without living in the house first. And I don’t think you can fix such problems without major renos.
I still use to believe you could buy a decent house in a new subdivision if you looked hard enough. But they really are the trash that we keep being warned about. And if someone is telling you different, well they don’t live there…or even worse…THEY DO!
If we ever do buy again … It will have to be for dirt cheap. Anything “fancy” can’t be trusted. Too many pigs with lipstick.

#84 Devore on 01.27.13 at 11:03 pm

#38 InvestX

I’m confused. Please clarify?

Dividend payers already carry a built-in premium because investors know they will be taxed on dividends at half the rate of income. Or put another way, investments paying income are discounted vs dividend payers because a higher tax rate applies on their distributions. This premium is doing nothing in a tax shelter, and is a total waste in an RRSP where you’ll pay income taxes instead of the lower dividend rate.

TFSA – tax shelter (stick your REITs and income funds in here)
non-registered – for dividends/cap gains
RRSP – tax deferral/transfer

#85 Brew on 01.27.13 at 11:07 pm

I love that pic. Had it on my office wall until my last day.

Brew

#86 Roy on 01.27.13 at 11:12 pm

The young and horny, its like having real estate sex without protection in a land of the fiscally diseased.

Where HGTV taught that shopping for a house is the same as buying an iphone or a pair of shoes.

At this point in the market cycle… one day of house lust can easily turn into financial ruin.

#87 Steven Rowlandson on 01.27.13 at 11:19 pm

Revenge is best served cold.

As an investor I absolutely concurr.

#88 Party On Garth on 01.27.13 at 11:23 pm

#83TomOfMilton ,

We’re are in the same boat as you. Renting brand new construction. Total shoddy crap. Unbelievably bad electrical, warped baseboards, super cheap finishing, and creaky floors.
Add to that towering hideous houses jammed in next to each other on tiny yardless lots, with no privacy or noise buffer.
The sad thing is this community is going to be stuck with these awful neighbourhoods for the next hundred years. This place will be a dilapidated ghetto inside of twenty years.

#89 Mixed Bag on 01.27.13 at 11:25 pm

Hopefully all they lose is the $15,000 deposit. It’s a less costly lesson learned, but a valuable lesson learned.

Part of me says, geez… how could they do something so foolish? Not even an inspection?! (Is it true?) An *impulse* buy?!? Good grief!
But the other part of me remembers being young and stupid. I’m just a little older now, and just a little less stupid.

Learn from this experience, both of you, and good luck.

#90 jo on 01.27.13 at 11:31 pm

These two should have listened to Garth, they could have saved themselves. I am not sure anyone can recover from a mistake like this. I so wish Garth was there for us in the 80’s, we would have been so much further ahead. My problem was not knowing what and who to believe, so many vested interests out there. Let’s face it, how many of us can evaluate every scenario and predict the ramifications for the average person like ourselves. Not many you can trust these days. This world has to many salespeople. Thanks Garth, you are going to save me so much grief in future.

#91 BC Nurse Prof on 01.27.13 at 11:39 pm

Garth: I disagree with your assessment of what’s happening in the U.S. Here is a cogent summary:

http://agonist.org/2013-financial-overview-the-endgame-is-closer-than-ever/#more-101074

IMHO, the swan that will take a crap in the pool, of the many that he lists, will be climate change caused food shortages.

I sure hope you don’t believe that article. It is riddled with untruthful statements. — Garth

#92 Rob on 01.27.13 at 11:45 pm

There are 3 possible “agencies” the Selling Realtor could have had with Jason and Maria. First is to solely represent them…not possible as the Realtor was working for the Seller. Second is to represent both the Seller and Buyers…called “Limited Dual Agency” and then the Realtor has a fiduciary duty to both parties but is limited as to guidance to each party and both Buyer and Seller have to agree to this. The third is when the Selling Agent has no responsibilities to the Buyers. Both the second and third “agencies” would result in the Selling Realtor getting all the commission (“double-ender”).

As Garth mentioned, when a Seller signs a listing contract with a Realtor, the commission is set and not having a Realtor represent the Buyer means no savings for the Buyer but a “double-ender” for the Selling Realtor.

The term “ethical Realtor” is not an oxymoron…there are ethical and unethical people in all jobs and professions. Take care in selecting a Realtor and if it seems like you are being pushed to move quickly on a purchase then you need to back off. A home is an incredibly expensive purchase that will alter your life and usually put you in debt for a long, long time. A purchase should be done after careful consideration and take a lot longer than deciding on what you want on your pizza! Unfortunately, sometimes market conditions bring a sense of great urgency into a purchase and people lose their common sense when they think they might lose a “deal” and pay more in the future. House prices can’t defy the laws of economics any more than any other readily available commodity can…once the price is too high, demand drops and prices come down.

#93 45north on 01.27.13 at 11:46 pm

TomofMilton: I used to believe you could buy a decent house in a new subdivision. But they really are trash and if someone is telling you different, well they don’t live there…or even worse…THEY DO!

pretty funny Tom

#94 WileyM on 01.27.13 at 11:52 pm

I’m with #10 craple smaple: “Don’t bother with an agent. You just need an experienced lawyer and half a brain.” or at the very least #23 Kam: “Show the offer letter to you(r) lawyer before you fax it to listing agent.”

True Story:
Put down a $5,000 deposit subject to a house inspection. Buyers’ agent wrote ” subject to mechanical inspection ” on offer. When questioned about wording, agent confirmed that this was the correct technical wording.

Inspection came back with structural issues so buyers wanted deposit (which agent had put in trust) back but were sued by sellers (and the sellers’ agent and her deep-pocketed realty company) to keep deposit because “the furnace was only mechanical item in house and it was okay so house had passed inspection”.

Ultimately, buyers settled with sellers to give them half of deposit as was cheaper than lawyer’s fees and a trial.

Beware of incompetent, unethical realtors. Applies to lawyers, too.

#95 Careful — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate « The Affluent Boomer™ on 01.27.13 at 11:58 pm

[...] via Careful — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate. [...]

#96 Smoking Man on 01.28.13 at 12:08 am

Thanks Yoda, I got the vision, in Canada we have more CFA, s than plumbers, laws of supply and demand..

A person that breaks there neck to help others, needs help. A dog that projects success (Not including me) is not…….

A chic that likes woman, we’ll hello premier… I like Chics too

#97 minus40 on 01.28.13 at 12:09 am

Just discovered this game: Vancouver – crack shack or mansion? It’s suprisingly difficult to tell them apart – http://www.crackshackormansion.com/

#98 kelly on 01.28.13 at 12:21 am

Please, Jason and Maria is it? Tell us your occupation. I would really like to know how you have managed to survive in the world to date. What kind of job you have that would employ impulsive people, without much intelligence, who does not give any thought to life changing decisions, yet pays them enough to have a $945,000 mortgage? Tell me if your company is hiring, cause I would love to apply for a job. And even a scarier thought, “these 2 people could possibly have kids one day.”

“BUYERS AGENCY” If the listing realtor represented you, you will have recourse. When he wrote up the contract, he HAS to explain agency to you. If you agreed to “NO AGENCY” it means that you agreed to no representation, therefore no recourse. Even though he is the listing agent, he has an obligation to look after the buyer’s interest if he indeed gave you “buyer’s agency”. He should have asked if you wanted an inspection, mortgage approval, etc.

#99 45north on 01.28.13 at 12:31 am

Mark Hanson: 2012 saw the greatest credit tightening in Canadian history

and I’m thinking that 2013 will see the greatest decline in sales in Canadian history. Flaherty has made his play and really his only hope is to stick with it. I mean once it becomes obvious that sales are way down then it is obvious that schemes to prop them up are unwise.

#100 Debtfree on 01.28.13 at 12:56 am

Saw an interview with our micro finance minister this afternoon trying to throw Kevin Page under the bus . I will be interesting to see them replace him with a well trained monkey . They seem to be the only ones that survive in the harper gov. If you can’t leave your brain at the door your gone . Hmmmm does that have a familiar ring to it or what . I’ve never seen the underside of a buss . I wonder if anyone on this blog could give him some advise on how to survive it . Telling the truth doesn’t seem to help . Every time I see f or any of them it makes me want to puke . There isn’t enough guts in the harper gov. To make a package of wieners . I hope Kevin opens up like Garth did when he gets out in march . Thanks Garth you’ve saved my kids decades of heartache ,remorse and put us and them on the money road .

#101 Nostradamus Le Mad Vlad on 01.28.13 at 1:07 am

-
“Of course you should walk, silly hormonal, self-destructive, irrational people, I said, letting my feminine side show through. You bought it. Congratulations. And they did. They’re freaking.”

Ahh yes, the Pot of Gold always ends at The Beer Store, but I like #24 pathcontrolmonk’s idea — buy it, add some granite and SS on, then resell it for a slightly higher price.

#29 Grim Reaper/Crypt Speculator — “Also WINDOWS XP is all you need….” — XP is all I use and all I’ll ever need!

#53 betamax — “Jason, welcome to a state of indentured servitude.” — Unfortunately, you are right. I did a five year indentured apprenticeship, but when that five years was complete, I was free to travel anywhere I wanted, and had the papers to prove I was a journeyman. Not so buying way above one’s means — that’s a death sentence.
*
2:14 clip Life under the NWO. Possibly this is a reason for the condo mania; 2:58 clip “Where does it state in the Constitution that the government has the authority to impoverish the American people to save the banks from a disaster the bankers themselves created?” wrh.com (Let broke banks fall); Economic Religion “The Virgin birth. The Chosen people. The Resurrection of the dead. The Free Market.” OK, which is it? 1836 Yes, the European banxters were probably there as well; Better off on benefits The couple doesn’t work, as they would get less pay. The whole system is cock-eyed; Apple Offshoring US$1 bln. / week? Brussels gone, Geneva in; Tax Avoidance to help feed the poor? Gold mining in SA takes a hit.

Libertarian turned Keynesian; Commodities, and where they come from; Sign from oDg that the bond market may / may not crash; Build Higher Hurricane Sandy is Katrina all over again; China Similar to the west; It’s Official TPTB say so; Good Morning Vietnam Oil deal; Shouting Match “The IMF Will Decapitate The Nazi Skull and Bones German Deutsche Bank”; Austerity in the USA Starting March; Shiller on house prices; Acer Google’s Chrome better than Windows 8?
*
Smoking Man – You’re right again! Plus Teen Chef Good for him! 7:16 clip Big pharma execs. (35 years) turned whistleblowers, and 10:01 clip Dumbing down of society; The British Inquisition? Nobody expects the British Inquisition! The Droning of America turns the US into a war zone; Wacky Weather and the Met Office got it all wrong; Gambling Addiction Like junk food, it’s not worth it; Solar Shingles A new way to reduce dependency on electricity / gas? Blind Sled Dog has fun with brother’s help; California Shakin’ The San Andreas Boogie.

Lord of the Flies Seems there is a connection between Obomba and the negative force (Satan). The negative force runs the lower psychic regions; Coincidence? Unlikely; Dianne Feinstein, the Chinese govt., Soros and Obomba are all anti-gun merchants of doom, and Gun Confiscation Communists love it.Iran Ehud Barak was the architect of 9-11, and !Bovine Excrometer Alert! ‘Noddin Yahoo getting all paranoid again.

#102 Good authority on 01.28.13 at 1:12 am

“After this Spring market’s passed, buyers will rule.” – Garth

Does this mean you suspect a mini rally in RE this spring?
Perhaps it means you suspect that the market will float even while the demand softens in sale numbers, followed by melting prices as we head towards warmer days.
I suspect the latter.

#103 Dr. Hoof Hearted on 01.28.13 at 1:16 am

Its amazing…

Add “Dr.” in front of yer Gnome De Plumage….the Nurzes drop their biz cards (and do the lawndreez afturd).

Teste -moan- ial :
Smoking-Olde Man weekend course is worth 10x” s what itdz wurth.

#104 Carpe Diam on 01.28.13 at 1:19 am

You can’t cure stupid.

#105 Carpe Diem on 01.28.13 at 1:21 am

Very sad story BTW. I feel for those kids getting sucked in like that.

#106 Kilby on 01.28.13 at 1:35 am

Probably useless tax sucking govt workers with guaranteed income and guaranteed pensions while the rest of us in the private sector make 1/2 of much with no pension and are forced to live in condos if we want to live in Moldcouve

Why do so many people think government workers make so much? This is serious private $$$$ that buy houses like this. 90% of government workers don’t make 50k per year, just management, like everywhere else.

#107 Smartalox on 01.28.13 at 1:52 am

Just when you thought it was safe to rent out your overpriced Vancouver condo, to cover the costs of your investment. The city of Vancouver has its own condos to sell, and wants to make sure your rents stay low.

http://www.vancouversun.com/news/rental+units+rise+Vancouver/7880342/story.html

#108 live within your means on 01.28.13 at 2:17 am

About 22 years ago I worked with a gal who put a deposit on a house. She & her hubby really regretted it later & lost their deposit. Both had well paying jobs, but still. They were childless & their passion was travelling. They later ended up buying a beautiful condo overlooking MicMac Lake & continue to travel, free of the worries of SFH ownership while away.

#109 Tony on 01.28.13 at 2:21 am

Re: #50 T.O. Bubble Boy on 01.27.13 at 9:24 pm

Most of them will end up living with the hobos on Yonge Street after the bank forecloses on them. Stupidity knows no bounds.

#110 Dr. Hoof Hearted on 01.28.13 at 2:33 am

Oh Yeah !?!

……………………and same to ewe !!!

#111 live within your means on 01.28.13 at 2:43 am

#10 craple smaple on 01.27.13 at 5:19 pm
Don’t bother with an agent. You just need an experienced lawyer and half a brain. We bought our last two houses without an agent and sold our last house without an agent. No problems, saved money.

How would you know without comparables? A buyer’s agent costs zero. Why not employ one? – Garth
……………………..
When we sold our previous home 23? yrs ago we went with a non-affiliated RE agent, if that’s the correct term. He arranged for a 2nd mtg. for the buyer. We also dealt with him to find our current home. We have no regrets. We based our purchase on 1 salary.

#112 Don on 01.28.13 at 2:48 am

I think their first mistake was not performing due diligence to follow current market conditions. Nothing like jumping on to go over the cliff. Geezus, young love at first then hard cold reality.

They went home and calculated they could no longer eat out, drink, and play the part in Vancouver at their current salary levels. It is expensive to play the part in Vancouver, some refer to it as the Show a bubble within in bubble within the housing bubble.

#113 Vamanos Pest on 01.28.13 at 3:00 am

If you want to feel sorry for someone, feel sorry for the tax payer. This one has CMHC bail-out written all over it, right down to the just-under-a-million price tag. Trust me, we’ll be stuck with the tab on this one, and 7 years later, Jason and Maria’s credit will have healed so they can do it again.

Awesome.

#114 broadway skytrain on 01.28.13 at 4:09 am

if today’s unfortunate couple actually bought a house in kits they would have little to worry about.

in the area bordered by burrard/12th/macdonald/and the beach – “central kits”, where you could easily walk to the pool/park/etc. there is a severe lack of supply – there are a grand total of 4, yes four, houses for sale.

one at 1.15m is not liveable – a junker rental
the others avg about 1.8m

if they bought a condo/twnhse then may the Dog have mercy on them, esp with a 700-800 condo fee(ouch!)
——————
SFH supply is equally hard to find on the e side.
There are a total of about 25 houses for sale in the entire section of east van that i would consider as ‘central’
(comm/12th/renfrew/hastings) – easily the lowest i have seen in the last few years.
half of these are on/near major streets, leaving about a dozen liveable houses a reasonable distance from DT.

with central sfh far more rare than leaf wins i can’t see the price taking much hit in the brewing/blowing storm.

where else in canada are people out biking 30km rides along oceanfront seawalls/dikes/parks all thru dec/jan/feb- the regular breaks in the winter rains we have been lucky to have this year have made the winter quite bearable

#115 Buy? Curious? on 01.28.13 at 4:27 am

Garth, your picture is from a Beer Store up in Kirkland Lake. Funny how we celebrate the distribution of the most controlled legal drug out there. I guess it’s the perfect metaphor as to how Canadians will take it from….the opposite of Front, and never complain or ask to change.

I hate the beer store. I remember lining up to pay $50 for 24 beers on a long weekend. The worst was when locals would be there on the weekend. Why couldn’t they have gone shopping during the week?

http://www.youtube.com/watch?v=BB0DU4DoPP4

Rob Ford for Prime Minister, just for the laughs.

#116 vancouver2011 on 01.28.13 at 5:07 am

Hahahahah…… finding a good realtor that works for the buyer…..(in our case)
wanted to put in an offer on a place we could see ourselves living in here in van last year with our agent.
the place was listed for close to 600 large. we told our agent that we wanted to put in an offer for 525. she refused to put it in writing stating that the seller wouldn’t accept any low ball offers. so we walked away from the place and our agent.
turns out – the place sold a month later for 535 and we are still looking……

#117 Need Sleep on 01.28.13 at 5:16 am

Not as bad as the couple Garth mentioned, but my husband’s co-worker just bought a house at 20K over list in south Winnipeg only to find out after that they were the only offer.

#118 Muddy Waters on 01.28.13 at 6:00 am

Not my experience, and I have bought/sold dozens of times. — Garth

Now I know why all my posts have been deleted.

No, that would be because you haven’t made any. — Garth

#119 The American on 01.28.13 at 7:11 am

Can they just choose not to sign the closing docs and deed transfer? Sure, they may lose the $15,000, but that’s a lesson learned. It is a hell of a lot better than losing nearly 50% of a home’s near-$1,000,000 “value.” Hmmmmmm, lose$15,000 today, or $500,000 over the next 6 years. Sounds like a no brainier.

Will be sued. — Garth

#120 Party On Garth on 01.28.13 at 8:34 am

You can also negotiate with buying agents. The last time I bought, mine kicked back one percent of purchase price in cash on closing. Nice little cash infusion to help with moving costs. He still got a nice easy commission for little work. I was going to buy one way or another.

#121 Herb on 01.28.13 at 8:46 am

#82 and 96 Smoking Man,

I am directed to point out that #96 proves that you didn’t hoist in Yoda’s reply to your #82: “When you run out of shite to talk about, don’t talk.”

Herb, Yoda’s Medium.

#122 rosie "moving forward" on 01.28.13 at 9:02 am

I see that the Star has assumed the official mantra. Moving forward on your pension is not as clear cut as it seems, or is it?http://www.moneyville.ca/article/1319398–should-you-claim-cpp-at-60-or-wait-until-70

#123 Bigrider on 01.28.13 at 9:22 am

Nonno Nicola.

Where are you buying your semi today amyway? GTA, Vancouver ? Calgary ?

Anyway, you may want to pick up this months issue of Canadian Business or Macleans and possibly, have a private consultation with Garth should he make himself available.

I fear for you future as well.

#124 Munch on 01.28.13 at 9:26 am

First!

Yes?

Yes?

#125 EIT on 01.28.13 at 9:49 am

They should send the keys to the bank and walk away.

Will be sued and the only out is bankruptcy. — Garth

#126 CrowdedElevatorfartz on 01.28.13 at 9:55 am

Hmmmm they went house hunting in Kitslano.
They put an offer down on a house for aprox. $1 million….
THEN they crunched the numbers????

idiots and their money………

#127 On The Sidelines on 01.28.13 at 9:58 am

Very unethical realtor in my opinion . Typical Realturds. It’s the 95% that make the other 5% look like scum.

They did not have a realtor. Stuff the hate. — Garth

#128 fancy_pants on 01.28.13 at 10:07 am

um. ya, fair trade act or something. Can I get my Bre-X $ back?

Too bad. those kids are SOL and debt ridden for life. They can hope the bubble has another heartbeat I guess b/c how will they ever enjoy the place with the regret looming over their heads (literally).

#129 hangfire on 01.28.13 at 10:24 am

DELETED

#130 Frank le skank on 01.28.13 at 10:30 am

There’s one question that everybody should be asking after reading this post.

What would a young couple do with Blue Berries and udder cream?

#131 Ann on 01.28.13 at 10:30 am

True storey worked with a buyer for a few weeks .He just had to buy, found a great home drafted an offer for asking price even though there were three other offers. While waiting to present our offer I stepped out to get some coffee and on returning found out he had changed my paper work to increase his ’bid’ by $30,000.00 so as not to lose out we got the deal I believe he left 40/50 K on the table. It’s not always the agent!

#132 jess on 01.28.13 at 10:46 am

“DocX” processed millions of mortgage foreclosures, primarily for the largest banks. Ms. Brown was its CEO. How many of the firm’s foreclosures were fraudulent?
…In her plea, Ms. Brown admitted to participating in the falsification of more than a million documents.”

=======
cdo – the stack ?
By JESSE EISINGER, ProPublica
http://dealbook.nytimes.com/2013/01/23/financial-crisis-lawsuit-suggests-bad-behavior-at-morgan-stanley

escape velocity?
frontline.org/untouchables

#133 The American on 01.28.13 at 10:51 am

At #119: “Will be sued. – Garth”

I believe you, Garth. I really do. But then I am confused as to why a person would need to front earnest money in the first place if the seller can sue anyway. Typically, the earnest money does two things in the U.S. (yeah, I now this isn’t Canada): 1. Demonstrates to the Seller that the Buyer is serious and is an expression of good faith the buyer indeed has the funds to close the sale. 2. Acts as security interest in the home that, if in the chance the buyer does not proceed after all contingencies are forfeited or waived, the Seller keeps the earnest money as the “damages” he/she receives. A seller has NOT incurred damages to the tune of the entire home’s “value” simply because a buyer does not move forward. The seller’s damages might be, at best, a few days of lost traction on the market.

A seller could sue a buyer for any reason in the U.S., but consumer protection laws here would protect the buyer in this instance, and at most, the buyer would lose his/her earnest money. And in many cases, a buyer doesn’t even forfeit his/her earnest money, due to local and/or state laws that would intervene.

If what you’re saying is true, that is totally and completely twisted messed up.

The agent in this case had dual representation, and BY LAW had a fiduciary responsibility to the buyers to secure their best interests. In this case, the agent clearly did not. The buyers could use this and very well have a leg to stand on should they be sued. The brokerage would have to cough up the funds.

#134 Ronaldo on 01.28.13 at 11:38 am

#114 – Broadway Skytrain –

”where else in canada are people out biking 30km rides along oceanfront seawalls/dikes/parks all thru dec/jan/feb- the regular breaks in the winter rains we have been lucky to have this year have made the winter quite bearable”

A 1 hour and 40 minute ferry ride from Horseshoe Bay where housing prices are a third of what you pay.

#135 John Prine on 01.28.13 at 11:47 am

But one expert questioned the wisdom of the city’s rental housing policy, which provides incentives for rental-only developments, such as waiving the development cost levy on new projects.

“There are two issues here: the slowdown in the for-sale market has made rental look more attractive,” said Tsur Somerville, a University of B.C. professor who teaches in the Sauder School of Business and studies real estate markets.
——————————————————————–

Sad…..The City of Vancouver gives breaks to people wanting to create rental space and look at the “expert” that has a problem with it. Somerville is such an embarrassment, another with his head in the sand with regards to the obvious. A recent study in Canadian Business showed that “experts”have no better forecasting skills than the average investor

Read more: http://www.vancouversun.com/business/rental+units+rise+Vancouver/7880342/story.html#ixzz2JHkQRCCz

#136 Dr. Hoof Hearted on 01.28.13 at 11:56 am

Interesting photo..contrasts of Shanghai and Detroit

http://www.thedeathofamerica.org/images/shanghai-detroit.jpg

#137 Oceanside on 01.28.13 at 12:05 pm

where else in canada are people out biking 30km rides along oceanfront seawalls/dikes/parks all thru dec/jan/feb- the regular breaks in the winter rains we have been lucky to have this year have made the winter quite bearable.
______________________________________________

All of Vancouver island, even Victoria is a bargain compared to Vancouver and has less rain.

#138 Mixed Bag on 01.28.13 at 12:12 pm

I was wondering if they could get out of this situation if they declared bankruptcy, and Garth replied to #124:

Will be sued and the only out is bankruptcy. — Garth

Of all the possible scenarios, declaring bankruptcy, buying the place, getting sued, or working out an arrangement with the sellers to get out, which will be the least costly overall in the long run? Not just $$ but in terms of stress, options in life, etc. Ouch. My guess is bankruptcy, but wonder if my estimate is incorrect. For some people, bankruptcy would be a huge blow (self-esteem/pride, forced to sell all remaining assets, future purchases, etc.), for others, barely a change in day-to-day life. Which of these two sides do these two fall in?

#139 Dr. WAYNE on 01.28.13 at 12:15 pm

#75 Cici on 01.27.13 at 10:45 pm

# 37 Dr. Wayne

Just contribute more worthy dialogue already!

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

WORTHY is a purely subjective term …

#140 Dr. WAYNE on 01.28.13 at 12:18 pm

#104 Carpe Diam on 01.28.13 at 1:19 am

You can’t cure stupid.

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

Well … I’m trying … ever the optimist …

#141 Mister Obvious on 01.28.13 at 12:28 pm

#132 The American

In Canada, a buyer signs an offer to purchase. After all subject clauses have been removed they have effectively entered into a legal contract.

One of the terms the buyer explicitly agrees to:

If the sale does not complete they are liable for damages “not limited to” the original deposit.

The seller keeps the deposit and has the right to sue for more. How much more is something that lawyers and courts would decide, probably after several sad and frustrating years.

Whether the seller finds another buyer in the meantime is immaterial. By signing, the buyer agrees to these terms up front.

But in practice, who can really be bothered? Most sellers make sure the deposit is fat enough to cover their troubles in the event a reneging buyer.

But things are changing aren’t they? Its turning into a very mean world. Especially here in Vancouver where sales are now a smoking crater and agents are entering a new era of desperation.

#142 jim on 01.28.13 at 12:31 pm

I have no pity for these idiots. The rule is ‘buy low sell high’, not ‘buy in an obvious bubble and hold’. They deserve what they get, and yes, a contract is a contract.

The worst part is that they didn’t actually think the financing implications through before putting the money down. This isn’t buying a cake at the grocery store when you are on a diet. The long term consequences are serious.

#143 Frank le skank on 01.28.13 at 12:35 pm

I would imagine that the sellers greed would make a negotiation for them to keep the deposit but allow the buyers to backout be their best option. Why bother going into bankruptcy and srewing your credit for at least 7 years. If they are looking to purchase a million dollar home, they will survive without the $15K and can recover quickly. The savings they will incure from buying in a year or 2 should more than make up for the 15K loss.

#144 jess on 01.28.13 at 12:36 pm

boom growth + drought
Lake Mead dipped to 1,085 ft in September, < 40% of its capacity

Hoover Dam may have to shutter its 17 Francis-type hydroelectric turbines, each generating 130 MW, by 2013. The facility also has two 60-MW turbines and two 3-MW service generators. Lake levels have been dropping by 10 ft annually and cannot feed the turbines below 1,050 ft. “It was designed as a high-elevation dam,” says Pete DiDonato, dam facilities manager for the U.S. Bureau of Reclamation.

The 2,074-MW dam provides electricity to 1.3 million people in Arizona, Nevada and California, generating 4 billion kW hours of electricity annually, under normal conditions. But falling water levels have reduced operational capacity. Lake Mead loses 100,000 acre-ft of water every time the surface level drops one ft, equal to 5.7 MW less power.

risk
..There is a 50% chance that Lake Mead could be dry by 2021 under current climate-change and water-usage scenarios, according to the La Jolla, Calif.-based Scripps Institution of Oceanography. It says there is a 50% chance that water levels will drop too low for hydroelectric power generation by 2017. “It depends on what the runoff will bring next winter in helping increase those lake levels,”

#145 Ronaldo on 01.28.13 at 12:57 pm

Interesting stats on incomes in Canada. The top 1% of the 25.5 million tax filers who make just over 201,000 account for 10.6% of the nations total income. This same group also pays 21.2% of all taxes. As of 2010.

http://www.statcan.gc.ca/daily-quotidien/130128/dq130128a-eng.htm

#146 Ronaldo on 01.28.13 at 1:02 pm

Will be sued and the only out is bankruptcy. — Garth

Garth, lets say they are professionals in the 1% group that make over 200,000 with solid jobs and they do declare bankruptcy. Could they not have their wages garnisheed or does bankruptcy prevent that. If not, they are screwed.

#147 Ann on 01.28.13 at 1:04 pm

Garth
With the housing pricey at an all time high due for a correction. What about the stock market reaching all time highs again?

No correlation. — Garth

#148 Dontcallmeshirley on 01.28.13 at 1:10 pm

Will be sued and the only out is bankruptcy. — Garth

Not quite.

The seller would have to initiate court proceedings to secure a damage judgement. Costs $$$.

These buyers could ignore the damage judgement in which case the seller would then have to secure a garnishee order. Costs $$$.

Does this seller want to sell the damn property or collect some bi-weekly amount for the next 20 years?

More likely the seller keeps the deposit, sells the property to someone else, and may or may not collect the difference from the would-be buyers.

It’s really just the deposit that’s lost.

A damage judgement isn’t the hammer people think it is.

Yes it is. If they have assets, game over. — Garth

#149 fancy_pants on 01.28.13 at 1:33 pm

You would think the agent put in a conditional upon financing clause on the buyers behalf.

If so, just quit your jobs before you go to the bank and declare no source of income.

If no such clause, they should pursue the possibility of suing the agent for not acting in their interest.

It’s not right; I know I would chase all avenues desperately to break this contract.

That was my point. They did not have an agent. Dumb move. — Garth

#150 TnT on 01.28.13 at 1:36 pm

#132 The American on 01.28.13 at 10:51 am
At #119: “Will be sued. – Garth”

Very simply

Any deposit for any house purchase is held in escrow until all the conditions are met as per the offer.

If you set no conditions then the house sale is final upon acceptance.

If you back out of any final sale than you are liable.

#151 TnT on 01.28.13 at 1:43 pm

Dr. Hoof Hearted on 01.28.13 at 11:56 am
Interesting photo..contrasts of Shanghai and Detroit

http://www.thedeathofamerica.org/images/shanghai-detroit.jpg

The photo of Detroit compares the Winter and Summer shots… Trees have leaves in the summer :)

Now lets compare where would you live given all that you know? Shanghai or Detroit?

#152 Snowboid on 01.28.13 at 2:09 pm

#143 jess on 01.28.13 at 12:36 pm…

No question that water conservation is going to be an important issue for the southwest US in coming years, but why quote an article that is over 2 years old?

The winter season after this article was first published in September of 2010 resulted in record snowpacks. Also, you forgot to mention the project to add a lower intake to mitigate the power issues – from the same article.

The level today of Lake Mead is 1122.59 ft (1229 ft. is full pool), this before spring runoff has started. Snowpacks are a bit below average for this time of year, but storms over the past weekend likely have brought the figures up.

Of course, when looking at the water issues facing CA, AZ and NV – one must realize the largest amount goes to California (about 55%) and is ‘guaranteed’. Arizona uses the next largest amount, followed by Mexico, then southern Nevada at about 5% of total usage.

California and Arizona need to change their policies on water usage – both for home use and agriculture.

Many managed communities in the Phoenix area are changing their ‘rules’ to ban high-water use – and are replanting common areas in native desert plants. Almost our entire property is now low-water usage plantings.

The best solution I can think of is to increase the cost of water to domestic users and agricultural operations that use antiquated irrigation methods (flood, etc).

We pay less for water here in the deserts of south-central Arizona as we did on Vancouver Island – which seems a bit ridiculous.

#153 jess on 01.28.13 at 2:17 pm

Icesave: Icelandic government wins compensation ruling

BBC News ‎- 5 hours ago
A European court clears the Icelandic government of failing to guarantee minimum levels of compensation for UK and Dutch savers …

“Iceland has from the start maintained that there is legal uncertainty as to whether a state is responsible for ensuring payments of minimum guarantees to depositors using its own funds and has stressed the importance of having this issue clarified in court,” it said….

When Icesave, an online savings bank, went bust in the autumn of 2008 at the height of the international banking crisis, the UK government stepped in.

To maintain public confidence and prevent a run on any other banks, the then UK Chancellor Alistair Darling decided to bail out 230,000 UK savers in Icesave to the full extent of their savings – about £3.5bn – not just to the maximum decreed by European rules for deposit compensation schemes.

#154 Vangrrl on 01.28.13 at 2:32 pm

#114:
“Where else in canada are people out biking 30km rides along oceanfront seawalls/dikes/parks all thru dec/jan/feb?”

Puhlease! Maybe 5% of Vancouver’s population would even dream of riding a bike in the rain. It’s not the norm!

#155 home_owner_12312 on 01.28.13 at 2:35 pm

I was once in similar situation. I made an offer to a resale property in GTA and later found out that the builder was selling the same house for much less. I walked due to the financial clause I had on my offer.

#156 Ronaldo on 01.28.13 at 2:41 pm

http://www.pointgreynow.com/KitsilanoCondos.ubr?order=listing_price%20ASC&page=1

Doesn’t seem to be any shortage of condo’s in Kits. Here’s a list of 179 units (not all condos) ranging from $266,800 to $5,888,000 (note the 8’s).

The intersting part is on the 4-plex for 5.888 mil they advertise rental income for the 3 units at $12,300 for retirement income while you live in one unit. ($4100 per unit?)

Well, using the 1% rule, on the amount of investment you should be looking at revenue of $14,700 per unit(not $4100) which means that you would be subsidizing each of your renters to the tune of $10,600/mo. and your portion would be $46,500/mo. Wow, what a great investment. Seems that one has been on the market for quite some time. Remember it being advertised it the Vancouver Sun quite some time ago.

#157 Alain Savard on 01.28.13 at 2:51 pm

Great post Garth. Very glad to see that you are promoting the use of a buyer agent. I hope one day you will challenge REALTORS to open real estate companies 100% dedicated to purchasers. Firms with no listings whose job is to protect buyers and try to get them the best home for their need at the best price. Jason and Maria could have used one.

#158 Renting and loving it on 01.28.13 at 2:54 pm

I used to work for a builder (freehold) and I’d see this quite frequently, even after describing what they were signing and committing themselves to. People would come in on a Saturday and put in an offer on a home, with a deposit. The offer would be accepted and cheque cashed. (I always made deposit cheques payable upon acceptance) Then they’d come in a few days or a week later and ask for the deposit back. They’d be shocked to discover that they’d forfeit the deposit. It turns out that in many cases, they went out and bought a house somewhere else and thought “I’ll just return the other one” like it was a pair of jeans.

Or those that would come in and blanch at the thought of a 5,000 initial deposit cheque. If you don’t have 5,000 for an initial cheque, maybe you shouldn’t be out looking to buy a house.

What this couple did is beyond stupid, and the Listing agent makes all Realtors look bad. This is why many buyer agents make certain that you’ve been approved BEFORE looking at houses. You don’t do number crunching after it’s yours.

#159 Frank le skank on 01.28.13 at 3:00 pm

My work started offering a group TSFA. Are there any advantages to a group TSFA compared to self directed?

The investment options are indexed market-based funds managed by TD Quantitative Capital. The management fees range from .36 to .42%.

#160 Holy Crap wheres the Tylenol on 01.28.13 at 3:00 pm

Unfortunately these kids are screwed. Capitulate? Rent out?????
Lots of grow ops needed out on on the left coast.

#161 The end is nigh on 01.28.13 at 3:02 pm

No correlation!
How about causation?
In 2008, 2009 both the stock and re markets crashed.

No causation here. — Garth

#162 Inglorious Investor on 01.28.13 at 3:02 pm

Something to think about:

http://www.zerohedge.com/news/2013-01-28/mark-carney-leaves-canada-stealth-qe-rising-fastest-pace-2009

#163 Holy Crap wheres the Tylenol on 01.28.13 at 3:08 pm

RIM, ouch that hurt today, Wednesday I will go big or go home! Probably to the bar…………

http://www.nasdaq.com/article/canadian-stocks-up-but-selling-of-rim-stock-and-mixed-us-economic-reports-cap-gains-focus-on-nordion-cm211459#.UQbL-fK55NI

#164 Seriously? on 01.28.13 at 3:09 pm

Sued for a cool million that they don’t have.

This is when their “Professional Banker” should take the “heat” and deny these “poor dumb bastards” the million dollar mortgage.

If the vendor proceeds it shows just how desperate they are and also that they are completely delusional in their analysis of the situation.

If they can find a lawyer to bring suit, it would probably cost them 100 grand to win “TPDB’s” last $35,000.

It doesn’t make sense. Take the “TPDB’s” $15,000., go on a holiday and start over with a tan.

Contract law on the surface looks all black and white, but just below the surface is a judge that will interpret the living shit out of the law and you are never guaranteed the outcome that you imagine.

“Poor Dumb Bastards”, run don’t walk to nearest real estate lawyer that you can find. Spend a few more grand on a professional opinion and then make your decision. Your “power” in this case is actually the cost of bring suit against you compared to an unknown outcome.

Plus you can probably keep their property tied up for years in a civil case (who wants that). If they sold it in the meantime, obviously their damages would not be proven.

Seriously

#165 The American on 01.28.13 at 3:20 pm

At #140: Mister Obvious, thank you for the information.

#166 Canadian Watchdog on 01.28.13 at 3:22 pm

At least someone else noticed the Bank of Canada’s QE program.

Mark Carney Leaves Canada With ‘Stealth QE’ Rising At Fastest Pace Since 2009

Bond yields will fall on the next announcement from the BoC to ramp-up its bond asset purchase program. Same like every other profligate central bank. It’s a race to the bottom now.

#167 Old Man on 01.28.13 at 3:23 pm

Anytime you owe people money they will hound you day and night. I have attended a few times with a default on closing as the two lawyers meet with this ceremony read out from one to another, and was asked to be a witness. Once said the lawyer acting for the purchaser in default just has one thing to say – accepted as presented. This becomes the basis for the vendor to recover all losses for a future lawsuit.

#168 Holy Crap wheres the Tylenol on 01.28.13 at 3:23 pm

#143 jess on 01.28.13 at 12:36 pm

boom growth + drought
Lake Mead dipped to 1,085 ft in September, < 40% of its capacity

Hoover Dam may have to shutter its 17 Francis-type hydroelectric turbines, each generating 130 MW, by 2013. The facility also has two 60-MW turbines and two 3-MW service generators. Lake levels have been dropping by 10 ft annually and cannot feed the turbines below 1,050 ft. “It was designed as a high-elevation dam,” says Pete DiDonato, dam facilities manager for the U.S. Bureau of Reclamation.

The 2,074-MW dam provides electricity to 1.3 million people in Arizona, Nevada and California, generating 4 billion kW hours of electricity annually, under normal conditions. But falling water levels have reduced operational capacity. Lake Mead loses 100,000 acre-ft of water every time the surface level drops one ft, equal to 5.7 MW less power.
risk
..There is a 50% chance that Lake Mead could be dry by 2021 under current climate-change and water-usage scenarios, according to the La Jolla, Calif.-based Scripps Institution of Oceanography. It says there is a 50% chance that water levels will drop too low for hydroelectric power generation by 2017. “It depends on what the runoff will bring next winter in helping increase those lake levels,”

This loss of water has been well documented for many years. I worked on a energy System for SES (Stirling Energy Systems ) out in AZ for a Stirling Engine that converts solar energy to kinetic energy. On 29 September 2011 Stirling Energy Systems filed for Chapter 7 bankruptcy as the stirling dish technology could not compete against the falling costs of solar photovoltaics (later to be found out to be false pricing from China), according to media reports. It had all the stuff and was in the right place (US Sunbelt) but never the less it died. This solar electric generator could have replaced the Hoover Dam energy losses easily. Who knows someone made a ton of money either way. Who sufferers the central valley region and Las Vegas.

#169 all_we_need_is_mortgage on 01.28.13 at 3:29 pm

Moody’s downgrades long-term ratings of six Canadian banks

http://www.globalnews.ca/moodys+downgrades+long-term+ratings+of+six+canadian+banks/6442797231/story.html

#170 dontcallmeshirley on 01.28.13 at 3:41 pm

Yes it is. If they have assets, game over. — Garth

The amount of unresolved civil damage judgements in Canada say otherwise.

A “writ of seizure and sale” you refer to isn’t without cost and complexity. Just getting a complete asset declaration could take months.

Perhaps these would-be buyers only put one of their names on the purchase agreement? That opens up many escape routes.

#171 Old Man on 01.28.13 at 4:21 pm

There is just one way that I know of for a young couple at some future time to buy a home; not now but in a few years. They may never qualify for a mortgage because of this and that from a bank, BUT never give up for home ownership at a discount in a few years if you want one.

Save your money for the big day, and be realistic, and look for a modest startup that is free and clear; even if you have to knock on doors with properties that have no listing, and just say we like your home, and would you sell to us. You might get lucky, and be able to negotiate a VTB first mortgage with a modest downpayment.

There are vendors that want to move on in life, and do not want cash, but income instead, so might take the equity back at a higher rate than they could get at the bank; they are happy and if all goes wrong they simply take the home back with a pre-arrangement of a quite claim deed inserted into the mortgage if such goes into arrears for 3 months.

#172 sciencemonkey on 01.28.13 at 4:21 pm

The collection Pump Six and Other Stories by Paolo Bacigalupi has lots of great environmental dystopian scific, including one short sotry about water shortage and claims.

http://windupstories.com/stories/pumpsix/the-tamarisk-hunter/

#173 Bottoms_Up on 01.28.13 at 4:28 pm

#130 Ann on 01.28.13 at 10:30 am
————————————-
As you were working on behalf of the buyer, did you counsel them that you felt the other bids would be below asking?

#174 Bottoms_Up on 01.28.13 at 4:34 pm

#111 live within your means on 01.28.13 at 2:43 am
——————————————————
23 yrs ago you could buy a house on one salary. Today in major Canadian cities it takes two. One salary might be able to get you a crack-shack though!

#175 Spiltbongwater on 01.28.13 at 4:38 pm

#153 Vangrrl on 01.28.13 at 2:32 pm

I played golf in the rain yesterday.

#176 Old Man on 01.28.13 at 4:39 pm

Now there may be those that say such cannot be done with a mortgage document, and was the first person in Canada who created a commercial mortgage acting as a bond instrument for $millions, whereby, the term of 10 years could be retracted or extended for another 10 years at the will of the vendor of the mortgage, so if interests rates went down could extend at the higher rate, and if interest rates went up could call the loan to rollover at the higher market rate elsewhere.

#177 hangfire on 01.28.13 at 4:41 pm

OK..here’s what sales trainers teach new realtards…”always collect a deposit equal to or larger than your commission”’….tricks like a realtard slipping a ‘ liquidated damages’ condition into the acceptance is also common pratice…because who keeps the deposit ‘in trust’ ? …the realtard of course…..the realtard business is all about them…..sweet ‘f’ all about you…….didn’t you know?

People get burned because they have been taught to be complacent by a government that has historically trained Canadians to be stupid and not question….this concept allows the government to brainwash children…who then become very naive and crap for brains citizens who are easily misled by the unions, government and the civil service thralls who can’t stand competition……and you have to ask why Canada has the lowest business class particapation than any other developed country? You think this is a country of guilty self loathing liberalized blubbering dummies by accident? Being weak and complacent was a Liberal Party poilicy for generations.

Why do you think that the Charter of Rape and Tears took away individual rights to decide on public issues and instead gave those decisions to Liberal appointed judges who were given their positions for life? So don’t be surprised when so called ‘self policing’ orgs like the RE Board has become to act as an entitled dictatorship….it’s pretty much government policy to fleece an ignorant population.

Now for the good news..

“The magic of liquidity is about to roll over US markets, and as it does, we are expecting to see a huge run-up in gold and silver prices, a bond market collapse and a soaring run of the stock market which should be an absolute marvel to behold. ”

Some people are much smater than the rest…like this guy

http://urbansurvival.com/week.htm

..he gives us articles like this to consider

http://www.forbes.com/sites/robertlenzner/2013/01/27/the-unintended-consequences-of-the-greatest-economic-experiment/

and quotes like this

The magic of liquidity is about to roll over US markets, and as it does, we are expecting to see a huge run-up in gold and silver prices, a bond market collapse and a soaring run of the stock market which should be an absolute marvel to behold. Our trading model turned bullish almost a month ago, as reported to Peoplenomics subscribers, and we may now be into territory where the only debate will be over precise timing.

..and this

So where does this leave people now, from an investment standpoint? Well ain’t that a fine question? We notice the calendar, so with gold deliveries coming up, we can expect the bankster-class to beat down prices for a while, as the world watches those pesky Germans trying to get physical custody of what should be theirs. But, depending on the Case-Shiller/S&P Housing report tomorrow (up likely) stocks could be set for big gains in February if it looks like inflation will be the cold-water that sobers up the runaway bond market.

…sit on the sidelines in your balanced accounts and shy away from metals at your peril says the smart money…which are you?

#178 Bottoms_Up on 01.28.13 at 4:42 pm

#83 TomOfMilton on 01.27.13 at 10:58 pm
———————————————
One of the worst things about those places is the lack of sound proofing around bathrooms. There’s nothing like letting everyone in the house know what you’re up to….

#179 gladiator on 01.28.13 at 4:42 pm

Thanks Watchdog @ #165: now we see there actually IS QE in Canada.
Garth, any comments?

#180 Bottoms_Up on 01.28.13 at 4:46 pm

#80 john on 01.27.13 at 10:53 pm
————————————-
You and Garth are both right on that one. You would have to negotiate with the selling agent to reduce the paid commission to only 2.5%. However, you assume that as a buyer without representation you would know the price you could get the house for. If you had an agent representing your best interests, they might be able to show you that the comparables indicate that the house is worth $790,000. Therefore, by buying on your own and getting a ‘deal’ at $825,000, you’re actually overpaying and could have done better by having an agent. Agents can in fact save you money (not always, but definitely in a lot of cases)!!!

#181 Condo Dweller on 01.28.13 at 4:46 pm

Real Estate Agents and their clients were a plenty in my building at Queen and Broadview this weekend. Numerous buyers looking to buy a box in the sky in Queen East. Thank goodness its different here :-)

#182 hoser on 01.28.13 at 4:48 pm

Even though the concensus on this forum is that realtors are good for nothing scum, the industry standards stipulates that realtors are professionals and should be held to the highest standards. In a court of law, it would be deemed that this professional realtor, with his/her experience, did not provide reasonable representation to an unsuspecting inexperienced young buyer. The judge would ask why these buyers had to write a contract with no due diligence or waived their rights to an inspection and financing clauses. Were there competing offers? Let’s see them. Was the price under market value? Let’s see the comparable sales? The realtor knows he is skating on very thin ice. Challenge him and he will fold. If not, he is an idiot.

#183 Doug in London on 01.28.13 at 4:50 pm

What you have with this young couple’s story is a fine example of the saying: act in haste and regret at leisure. Sadly for them, because they didn’t do their homework, the regretting period could be long given the large sum of money involved.

#184 Bottoms_Up on 01.28.13 at 4:52 pm

#65 Victoria Real Estate Update on 01.27.13 at 10:12 pm
———————————————
It would be interesting to see some of your numbers. How much have you paid in rent, or what would the rent equivalent have been? How much is the house price down (plus taxes and maintenance)? The difference equals ultimately what you have saved by waiting.

#185 broadway skytrain on 01.28.13 at 4:57 pm

#153 Vangrrl on 01.28.13 at 2:32 pm
#114:
“Where else in canada are people out biking 30km rides along oceanfront seawalls/dikes/parks all thru dec/jan/feb?”

Puhlease! Maybe 5% of Vancouver’s population would even dream of riding a bike in the rain. It’s not the norm!

———————
you damn right van gal, biking in the rain is for kids and dui criminals. i gots me a mercedes/truck/ecocar for when its a’ranin , but have been out most weekends since early dec as there have been lots of dry hours.( nov was very wet and very skiable)

and to the others, yes the island is nice, but not too many of those 1% jobs in nananananaimo;)

#186 Humpty Dumpty on 01.28.13 at 5:06 pm

There’s a pot of gold under every rainbow….

“We recommend legal marijuana be sold to the public through specialty private stores and/or anywhere regulated liquor sales take place,” the report says

http://www.huffingtonpost.ca/2013/01/28/marijuana-legalization-liberal-party-canada_n_2567316.html?utm_hp_ref=canada

Guess the Beer Store would offer more than just a chill…

#187 neo on 01.28.13 at 5:15 pm

CanadianWatchDog..You are contributor to Zerohedge now (-:

http://www.zerohedge.com/news/2013-01-28/mark-carney-leaves-canada-stealth-qe-rising-fastest-pace-2009

#188 Patiently Waiting on 01.28.13 at 5:27 pm

FYI: Todays’s stats from the Fraser Valley Real Estate Board show year over year sales down a wopping 30% …
—————————————————————-

FVREB STATS – as of January 28, 2013
18 of 22 Working Days
JANUARY 2013 Listings 2155 Sales 459
DECEMBER 2012 Listings 871 Sales 662
JANUARY 2012 Listings 2427 Sales 654

pw

#189 Canadian Watchdog on 01.28.13 at 5:28 pm

#98 Humpty Dumpty on 01.07.13 at 5:15 am

CW…. appreciate your response.

Not sure how Bc poses a threat to the US, yet I do agree this is going to get alot of peoples attention in the next 2 years.

—-

#101 Canadian Watchdog on 01.07.13 at 7:23 am

It doesn’t take much in today’s world for new ideas to go viral. If BitCoin can maintain its purchasing power against currencies, it will first be the currency of geeks, then many more will follow.

You definitely need to get out more. — Garth

—-

It's not there yet, but it's gaining steam. Bloomberg reports: Bitcoin’s Gains May Fuel Central Bank Concerns: Chart of the Day

#190 Smoking Man on 01.28.13 at 6:12 pm

#168

Wasn’t Moodys same rating agency that had leave bros at AAA.

Move along nothing to see…….

#191 Smoking Man on 01.28.13 at 6:18 pm

#165 Canadian Watch dog

That’s what I have been saying all along.

Canada is small, economy of scale, we need trade surplus or we die, won’t do that with a strong dollar and companies reluctant to spend on productivity.

Low rates for ever……..

#192 Smoking Man on 01.28.13 at 6:21 pm

162 told you to be careful with rim,, Samsung owns that market.. A lot of times cancer patients show signs of a come back just before they kick the bucket…..

Love my Galaxy 3 never going to apple or bb……

#193 Dr. Hoof Hearted on 01.28.13 at 6:29 pm

More on China

—It was recently announced that the Federal Reserve will now allow Chinese banks to buy up American banks.

—- In 2001, American consumers spent 102 billion dollars on products made in China. In 2011, American consumers spent 399 billion dollars on products made in China.

—The Chinese economy has grown 7 times faster than the U.S. economy has over the past decade.

—The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000.

— The United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001.

—- Overall, the United States has lost a total of more than 56,000 manufacturing facilities since 2001.

—According to the Economic Policy Institute, America is losing half a million jobs to China every single year.

— Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.

—- After being bailed out by U.S. taxpayers, General Motors is currently involved in 11 joint ventures with companies owned by the Chinese government. The price for entering into many of these “joint ventures” was a transfer of “state of the art technology” from General Motors to the communist Chinese.

—-Back in 1998, the United States had 25 percent of the world’s high-tech export market and China had just 10 percent. Ten years later, the United States had less than 15 percent and China’s share had soared to 20 percent.

—– The United States has lost more than a quarter of all of its high-tech manufacturing jobs over the past ten years.

— China produces more than 90 percent of the global supply of rare earth elements.

— China is now the number one supplier of components that are critical to the operation of U.S. defense systems.

#194 Mixed Bag on 01.28.13 at 6:30 pm

Two more comments:

1) It’s nice to see an article that provides a good example of why a good real estate agent is needed, in this case, the buyers’ agent. (It was a nice surprise compared to what we got used to reading about agents).

2) Lots of posts on how stupid, no sympathy, etc. It really made me think about how they got into this mess. Are they lacking the older, wiser family members whose advice they could have sought? (Or staying the heck away from trouble family members). Poor upbringing? (It happens, not meant as a derisive comment). Some other obstacles that hindered good decision-making? (Booze? Disorders? You never know). Circle of friends no help?
Just some musing, but an interesting exercise to ruminate on.

#195 Mike on 01.28.13 at 6:38 pm

just when things could not any more ridiculous, here is an AWESOME plan by your elected representatives in Marhkam. Lets build an NHL size rink, with no tennant, and put in on the back of new home construction

‘The GTA Centre is budgeted to cost $325 million (always goes up during construction). The “face” of the project is W. Graeme Roustan, who stepped away from a strong run as chairman of Bauer Hockey to concentrate on this project. But the real money comes from Remington Group, owned by a very successful developer named Rudy Bratty. It is to pay half of that fee.

Of the remaining $162.5 million, Scarpitti said Saturday that 95 per cent of that will be collected through a levy on newly built homes ($5,000 per unit), townhouses ($4,000) and condominiums ($2,000) in the city. Several developers took out a back-page ad in the local newspaper, The Markham Economist & Sun, indicating their support for this idea.

Toronto and the GTA deserves better….even Jose Canseco is not this stupid.

http://www.cbc.ca/sports/hockey/opinion/2013/01/future-of-new-toronto-area-arena-at-stake.html

#196 mortgagebrokeront on 01.28.13 at 6:46 pm

#168 that means higher costs for the big 5 banks to borrow money, who do you think will end up paying those costs?

Borrowers, we can expect mortgages in 4% range sooner than we think!!!

#197 OkanaganInvestor on 01.28.13 at 6:52 pm

#91 BC Nurse Prof on 01.27.13 at 11:39 pm
Garth: I disagree with your assessment of what’s happening in the U.S. Here is a cogent summary:

http://agonist.org/2013-financial-overview-the-endgame-is-closer-than-ever/#more-101074

IMHO, the swan that will take a crap in the pool, of the many that he lists, will be climate change caused food shortages.

I sure hope you don’t believe that article. It is riddled with untruthful statements. — Garth
———————————————————-
Garth, I could not find any fault with the articles’ statements or conclusions and would welcome your feedback on what untruthful statements you found.
Thank you.

#198 jess on 01.28.13 at 7:18 pm

#151 Snowboid
cbc.ca/passionate eye Last Call at the Oasis

“toilet to tap” approach which recycles waste-water into drinking water and has worked extremely well in countries like Singapore

do no harm first
U.S. Geological Survey found atrazine in approximately 75 percent of stream water and 40 percent of groundwater sampled near agricultural areas. Earlier this year, U.S. Representative Keith Ellison (D-Minn.) reintroduced a bill that (H.R.4318) would ban the production, sale, importation or exportation of any pesticide containing atrazine. However, as it currently stands, nearly 10 years after atrazine was banned in the European Union, the chemical is still sold in the United States.

Business First of Columbus ‎- by Evan Weese ‎- 3 hours ago
… is getting a $3.1 million settlement from herbicide maker Syngenta… … than 1,000 communities over atrazine running off into drinking water,

michigan
Lynn Henning has been a factory farm watchdog since 2005
“She worked by herself for many years, basically observing waste handling practices at some of the larger animal farms and then monitoring the local streams,” Miller said. After learning how to conduct water sampling, she taught others to do it.

#199 Bigrider on 01.28.13 at 7:46 pm

Garth you claim, and I believe you, to have bought and sold dozens of properties.

You should have kept them all and just rented them all out.

You would have made more money.

#200 Smoking Man on 01.28.13 at 8:27 pm

Proposed titles for my book.

Trading Batman Style.
Never drive over a pot hole while pick your nose
Liars Manual
Itchy Hemorrhoid
School is for suckers
Never bet on a fat lady
How to part the seas.
Amanda Lang’s Mentor
Zohan does bay street.
Braveheart hiding.
Olga Diarys

Don’t like any

#201 Old Man on 01.28.13 at 8:37 pm

Now will tell you something that few will ever know about, and that was the creation of the VTB mortgage in Canada during the 1950’s. It was all done by two men in Toronto; Gerry Morris and Morris Pompili, as knew them both as personal friends years later. I will never forget the day that Gerry Morris called me to meet him for lunch at the Royal York Hotel just outside of the Imperial Room.

Here was a multi- millionaire that controlled the mortgage business with VTB seconds, and brought his lunch in a bag to be placed on a plate, as had a table reserved just for him all week long. He bought nothing, but threw the waiter $10.00 which was a lot of money, and just laughed at it all, as bought the menu, and he had to pay.

Now the following morning Pompili asked me if he had brought his paper bag lunch, and said yes; he just laughed and hung up the phone on me.

#202 InvestX on 01.28.13 at 8:38 pm

Thanks for the responses regarding my question about dividends and the TFSA.

I am still wobdering what’s the downside of putting dividend paying stocks if they go untaxed. Isn’t that better than being taxed at a reduced rate after the dividend tax credit?

Doesn’t the dividend tax credit result in you still being taxed?

And isn’t no tax better, by sheltering with a TFSA?

#203 maxx on 01.28.13 at 8:48 pm

Tragic in the extreme.
Shame they didn’t trip over a cheaper way to learn life’s fiscal lessons earlier.
They’ve very likely toasted any chance of ever becoming wealthy.
Debt is one of life’s worst prisons.

#204 Devore on 01.28.13 at 8:49 pm

#168 all_we_need_is_mortgage

Moody’s downgrades long-term ratings of six Canadian banks

Nah, what do these guys know, it’s not like they’ve seen this movie before.

#205 CrowdedElevatorfartz on 01.28.13 at 9:08 pm

@#195 Mike
Hmmmm,
Sounds almost as stupid as Vancouvers BC Place footbal Stadium roof replacement.
A new roof exactly like the old roof ( Teflon, inflated, proven technology) would have cost aprox $35 million dollars and if the old roof was any indication…it would last 25 years.
But, the “movers and shakers” in the private sector that were very close to the Premier of the govt at the time proposed a “retractable roof” estimated at $135 million ( unproven technology, designed as the structure was refurbished). The roof was to be subsidized by a future casino/hotel paying rent for 30 years.
The result?
A new roof that cost $575 million, warranty issues, and the city refused the casino/hotel proposal.
So now the taxpayers of the province have a CFL football stadium that cost $575 million for renovations and a new roof. For footbal games that regularly pull in 18,000 to 20,000 people.

This was a make work project at best, and if the Auditor General gets to “look at the books” a possible taxpayer fleecing of epic proportions………

#206 Ogopogo on 01.28.13 at 9:08 pm

#163 Holy Crap wheres the Tylenol on 01.28.13 at 3:08 pm
RIM, ouch that hurt today, Wednesday I will go big or go home! Probably to the bar…………

At the moment RIM went south today I was looking at the RIMM thread on Stocktwits. It went ballistic. The AAPL fanbois flooded the thread to taunt the RIMjobbers.

Pure theatre. Wouldn’t touch with with a telephone pole.

#207 SHUBEDOBEDO on 01.28.13 at 9:19 pm

Mark Carney Leaves Canada With ‘Stealth QE’ Rising At Fastest Pace Since 2009
Submitted by Tyler Durden on 01/28/2013 – 13:38
As Mark Carney steps aside from his role at the Bank of Canada to undertake all manner of easy money in the UK, we thought a reflection on the ‘stealth’ QE that he has been engaged with, very much under the radar, in the US’ neighbor-to-the-north was worthwhile. It seems quietly and with little aplomb, Carney’s BoC has grown its balance sheet by over 21% YoY – the most since 2009. If that was not enough to make someone nervous, the quantity of Canadian government bonds on the BoC’s balance sheet has grown at a remarkable 46% YoY! All of this has taken place during a time when ‘supposedly’ the Canadian economy has been reasonably strong and foreign demand for debt high. With Canada’s CAD267bn debt due in 2013, we suspect this ‘stealth’ QE will continue to rise.

#208 AK on 01.28.13 at 9:28 pm

#147 Ann on 01.28.13 at 1:04 pm

“With the housing pricey at an all time high due for a correction. What about the stock market reaching all time highs again?”

Which Stock Market are you looking at?

The TSX index was 15,200 5 years ago. It’s still got another 20% to catch up.

#209 My thoughts on 01.28.13 at 9:32 pm

Can someone lock in now for a mortgage rate for a new build that doesn’t close until next year? 2014. I have friends that tell me they can?

#210 McLovin on 01.28.13 at 9:47 pm

hangfire-“…sit on the sidelines in your balanced accounts and shy away from metals at your peril says the smart money…which are you?”

How’s that been working out for you and the zerohedge crazies?

#211 Ann on 01.28.13 at 9:53 pm

173 Bottoms_Up on 01.28.13 at 4:28 pm
#130 Ann on 01.28.13 at 10:30 am
————————————-
As you were working on behalf of the buyer, did you counsel them that you felt the other bids would be below asking?
.====================================
Not only counseled him he actually was getting a little heated and reminded me I worked for him.So They took his offer in about 10 mins.and I knew he over paid.

#212 Don on 01.28.13 at 9:59 pm

@ #154 Vangrrl on 01.28.13 at 2:32 pm

#114:
“Where else in canada are people out biking 30km rides along oceanfront seawalls/dikes/parks all thru dec/jan/feb?”

Puhlease! Maybe 5% of Vancouver’s population would even dream of riding a bike in the rain. It’s not the norm!
###############
So true Vangrrl.

Nothing like starting a soccer season in September and the fields start to close down (due to rain) by what mid October. Ghost town when it rains. Drivers that treat the rain much like the sun. Don’t get me wrong Vancouver is ok and to each their own. But the constant down pour really started to get to me. good scene for young people but get out before you are to set in your ways. Life is about enjoying and not dodging bullets from gang violence in a bar.

#213 TomOfMilton on 01.28.13 at 10:09 pm

Ha ha ha! Yes sound proofing the bathroom. I’m not sure a guest would feel comfortable using the main floor bathroom. Actually sound proofing is just insulation…and since they did such a shoddy job keeping the house warm…they couldn’t possibly spend $7.89 on making a bathroom useable.
And how would you check for things like this on a home inspection? The house across the street is kept as pretty looking as I’ve every seen. It just has me shaking my head to know it is built just as badly. It has a for sale sign up…but people can’t help but look at the clean lines. How could a house that looks that good be so very bad! They won’t know until after they buy it.
If I buy again it will have to be a total dump and cheap enough that I can renovate. But I’m a long ways from even thinking about it. I see others see some of the same problems. My friend tells me a Romanian proverb that doesn’t translate all that well:
The fox who can’t reach the grapes says they are sour.
Perhaps I sound like that…sour grapes…but I did have a paid off house and sold it. Of course it wasn’t as expensive as these…but I’m not sure these are all they are cracked up to be. SEE there I go with the sour grapes again (grin). I think I’ll Judy rent it.

#214 45north on 01.28.13 at 10:09 pm

Buy? Curious? Garth, your picture is from a Beer Store up in Kirkland Lake.

I was in Kirkland Lake in December. Town is booming (gold $) – maybe that’s the reference

Hoof Hearted: Interesting photo..contrasts of Shanghai and Detroit

I’ve never been to Shanghai, here’s my Detroit story

On Sunday, I was in Detroit. It was bright and sunny and I was walking along 16 Mile.
http://kunstler.com/blog/2009/10/marching-toward-zombieland.html#comment-panels

[email protected]

#215 Who on 01.28.13 at 10:14 pm

If Jason and Maria read this I won’t rag on you like so many holier than thou others did. However the place for you to be seeking advice on your situation is a lawyer’s office not a website. Take all of your documents with you and do it fast. Perhaps you can avert disaster with the right help.

#216 Risk Analyst on 01.28.13 at 10:18 pm

Guaranteed Garth is writing about to bank downgrade.

#217 Dom on 01.28.13 at 10:24 pm

#162 anyone that has used the alpha dev knows bb10 beats ios and android on every metric. Btw I own a sg3. But will be dropping it for bb10. I don’t know how they did it but blackberry is back.

#218 Vangrrl on 01.28.13 at 10:26 pm

#175:
I did not say people don’t do things in the rain; I, too do not let the rain stop me from biking, hiking, etc. But to say that people move here and pay exorbitant prices because we’re all down with playing golf or biking in the rain is ridiculous. Most people in Van are like anywhere, driving around in their oversized cars and staying indoors watching tv on rainy nights.

#219 ozy - what the hell this price? hyperinflation has arrived on 01.28.13 at 10:32 pm

C2546380 $1,679,000 for sale in Leaside, a normal home for the normal middle-klass torontonian, on a modest 35 feet lot opening, 4brd, 1 garage. Nothing like space you do not need, or waste rooms, not a mansion.

Guys, ask for double / triple salaries, if you do not get them, move out of kanata, becaaaaaause yeah, the hyperinflation has arrived and it’s fricking your purchase power to a level your kids will tell you (when they mature) that you were trully-stupido for staying in kanata all of this time.
Courageous countries that finished with collonial system hundreds of years ago, are waiting.

#220 Fabrega on 01.28.13 at 10:38 pm

#23 KAM said:
“Sometimes listing agent agrees to offer 2.5% discount if the property is in the market for long time, but most of the time listing agent will ask you to make him/her as buying agent.”

WTF….selling agent, listing agent, buyer’s agent. HELP!

Could someone please clarify who pays what? Garth?

#221 bluesky alta on 01.28.13 at 10:43 pm

Timing is everything got caught up in the boom in Calgary 2006 got in over are head ,flipped some houses made some money .cashed out in 2009 both wife and I left our jobs and bought land and built our own home.we both worked very hard one year later we have our own home. We have met people who have lost their homes due to default and its heart breaking ,and the worst is yet to come IMHO. Enjoy the blog thanks

#222 EIT on 01.28.13 at 10:46 pm

Let this one pass Garth

Nope. — Garth

#223 m on 01.28.13 at 10:56 pm

Couple Who Made Quick Decision:
Poor planning, but obviously good income and young. I think you will be fine in the long run and may even be better for your purchase. If the place was a SFH in Kits, then they paid lot value.

#224 Bottoms_Up on 01.28.13 at 10:59 pm

#220 Fabrega on 01.28.13 at 10:38 pm
———————————————–
The seller signs documents with the selling agent stating how much they are to be paid. The selling agent then cuts a deal with the buying agent and pays the buying agent once the deal is complete. Typically they split the overall commission (but the buying agent isn’t allowed to see what the sellers are paying to the selling agent).

#225 Fabrega on 01.28.13 at 11:04 pm

#116 vancouver 2011
Are there any “good realtors” out there ???? It seems to me that the mentioned realtor was working for the seller and not you.

#226 45north on 01.28.13 at 11:05 pm

ozy: thanks for your link to three cities within Toronto – it shows depth

[email protected]

#227 Smoking Man on 01.28.13 at 11:11 pm

Oh O chest pains…. Perhaps I should quit..

Gambler’s Damn, pepto don’t work, popped aspire.

If I post no more you know I’m riding the sky with Becky. Shit this hurts

#228 AK on 01.28.13 at 11:30 pm

#169 all_we_need_is_mortgage on 01.28.13 at 3:29 pm

“Moody’s downgrades long-term ratings of six Canadian banks”

ZZZ-Zzzz-ZZzzz-hngGGggh-Ppbhww- zZZzzzZZ . .

#229 Fabrega on 01.29.13 at 2:23 am

#224 Bottoms Up
Thanks for the reply.
You said:
“The selling agent then cuts a deal with the buying agent and pays the buying agent once the deal is complete. ”

I think you mean “..and pays the selling agent once the deal is complete.” Right?

#230 Mike on 01.29.13 at 6:28 am

You can sue anyone for anything. Doesn’t mean they’ll have enough money to pay your legal bill.

The seller would be an idiot to not just take their cheque and put the house back on the market. They’re not going to get blood from a stone. It’s not worth dealing with the lawyers… that’s *why* you have a certified cheque.

#231 Steven Rowlandson on 01.29.13 at 9:53 am

What did the kids do wrong?

They forgot to get comfortable living with their parents and avoiding buying a overpriced house.

#232 You Bought It, Congratulations – “They spent Sunday going to open houses in and around their Kits hood in Van, then fell in love with a place listed just under a million.” | Vancouver Real Estate Anecdote Archive on 01.29.13 at 10:30 am

[...] – as told by Garth Turner, at greaterfool.ca, 27 Jan 2013 [...]

#233 dani on 01.29.13 at 2:01 pm

Best post ever…I would even take it step further and request a clause that states if the Bank’s appraised value of the property is lower than the purchase price, the contract is null and void. Yes …even this can happen and the buyer is screwed…

#234 guelphstudent on 01.29.13 at 8:13 pm

Great post garth, that letter was a killer! Shitty about being stranded in Montreal but at least when you get back it will be 11 plus 11 or more