Honest!

Honest

Real estate boards in Toronto, Vancouver and Calgary this week issued media releases reporting higher sales and higher prices. The media bought it. Big time. ‘Sales soar,’ said the Toronto Star. ‘Strong July sales showing market picking up steam,’ said the Globe. ‘July hottest month for home sales’, said the Vancouver Province.

GTA realtor Ross Kay ain’t buying it. He says the very data that local boards use is manipulated to distort sales, and this is then reflected at the national level.

“Unfortunately, the numbers reported, did not include the methodology used to calculate those numbers, changes to the data set year over year that affected the results or disclosures on why the actual number of resale homes sold reported to the media could be incorrect, simply by the methodology used to collect the numbers,” he says. “Actual resale home sales have declined 12.86% nationwide for the first six months of 2013  versus the first six months of 2012, when comparing the same data set year over year.  What this means is almost 15,000 sales have been included in the 2013 numbers that should not have been included for statistical reasons.”

Some people think he’s a kook. But the career realtor may have something valid to add to the debate about whether we’re in a sustained bull real estate market, or wobbling around at the top, ready to plunge. Let’s do a little due diligence on what North America’s largest real estate cartel has to say, the Toronto Real Estate Board.

Here is the official media release:

TORONTO, ONTARIO, Aug 02, 2013 — Greater Toronto Area REALTORS(R) reported 8,544 residential sales through the TorontoMLS system in July 2013. Total sales were up by 16 per cent compared to July 2012. “Last month’s sales represented the best July result since 2009 and was the third best July result on record. Despite recent increases in average borrowing costs, home buyers are still finding affordable home ownership options in the GTA,” said Toronto Real Estate Board President Dianne Usher.

“We are a year removed from the onset of stricter mortgage lending guidelines and many households who put their decision to purchase a home on hold have reactivated their search. An increasing number of these households are getting deals done,” continued Ms. Usher.  Reflecting tighter market conditions, the average selling price for July sales was up on a year-over-year basis by eight per cent to $513,246. The low-rise market segment continued to be the driver of overall price growth. It should be noted, however, that the average condominium apartment price was also up by more than the rate of inflation on an annual basis.

“We are forecasting continued average price growth for the remainder of 2013 and through 2014 as well. Months of inventory for low-rise homes remains near record lows, suggesting that sellers’ market conditions will remain in place in the second half of 2013. An increase in listings in 2014 would lead to more balanced market conditions and a slower pace of price growth next year, albeit still above the rate of inflation,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.

Wow. Sunshine and ponies as far as the eye can see. Sales up 16%. The best July since 2009. Prices ahead 8%. Affordable homes. And even-higher values guaranteed right through 2014. Why the heck wouldn’t the virgins want to buy into that kind of no-lose deal?

Here are a few facts TREB’s Minister of Disinformation did not point out to the media who (of course) believed all of it:

  • The average price of a detached house in Toronto is $793,842. The realtors say this is “6.5% higher” than a year ago. But it’s down steeply in a month – 8.4% lower – one of the most significant monthly declines in years.
  • In fact, the average selling price of a SFH in 416 is back at January levels. The decline was $72,400 in July from the month before, $70,600 from the spring, and $29,400 from the winter.
  • This reflects a deterioration in sales in what was one of the hottest segments of the market a year ago – homes over $1,000,000. Since Ottawa banned such listings from being eligible for mortgage insurance, sales have suffered. So much for the myth of millionaires buying million-dollar houses.
  • Condos doing okay, according to the cartel? Not exactly. Prices have fallen back to the levels of last winter. The average condo is $17,250 cheaper than it was in April, and lost $4,500 last month.
  • And, as I have pointed out consistently, the realtors inflate their sales numbers by comparing unadjusted raw current numbers against adjusted historic ones. So as reported sales inevitably fizzle, current sales look more robust than they turn out to be.
  • For example, that 16% sales increase in July was actually 11.2% more than reported a year ago. In June sales were -3.8% (the board said -1%), in May -6.1% (-3.4% was reported) and in April -5.4% (versus the -2% told to the media).
  • So for the April-July period, sales in 2013 are lower than in 2012 across the GTA.

Which makes you wonder. If things are so great, why do they need to lie?

193 comments ↓

#1 sunshine on 08.02.13 at 4:50 pm

They lie because their livelihood depends on it. There should be an independent body Analyzing these numbers, don’t you think Garth?

#2 sm_yyc on 08.02.13 at 4:57 pm

Another great post, Garth. i suspect the news piece across the msm may have gotten the best of you today to issue an early blog post.

Keep up the good work :)

#3 Wilbur on 08.02.13 at 4:58 pm

http://www.rebgv.org/sites/default/files/REBGV%20Stats%20Package%2C%20July%202013.pdf

Stats are in for the Vancouver housing market…

#4 HD on 08.02.13 at 5:00 pm

#137calgaryPhantom on 08.02.13 at 3:31 pm

No. Get some help. Blaming others for your own actions is not a great strategy, either. — Garth

#135 HD
————————————

Let me rephrase.
Reits are 25% and Preffereds are 25%, of my “Invested” money.
So basically my portfolio is 78% Cash, 6% prefereds, 6% REITs, 2% bonds and 8% diverse equities.
Basically i just started on my portfolio. So loaded up on REITS and Preffereds. I wanted to wait in cash and enter equities/bonds portion of my portfolio after a little bit of correction/sanity.

Is it still a whacked portfolio/strategy?

Gotcha.

You are basically trying to time the market.

It’s a game you are unlikely to win. Best is to figure out your asset allocation and stick to it (rebalance).

If your horizon is long enough, you should do fine with a passive investment strategy.

Best,

HD

#5 guelphstudent on 08.02.13 at 5:05 pm

TREB used to report median prices before 2011, but since July 2011 they switched to publishing average prices! Why?

If you look at the median detached prices you would find out that during 2008 crisis, free standing home prices crashed by 25%. Here’s the graph.

#6 rosie "moving backwards" on 08.02.13 at 5:09 pm

The numbers may indeed prove to be B.S. but perception is reality. The media reports what their advertisers say. Corrections are found buried, well after the fact. The truth probably won’t be obvious to the great unwashed until the landscape is littered with for sale signs.

#7 TO and GTA Sales and stats 2013-08-02 My heat maps made it to the news :-) on 08.02.13 at 5:13 pm

TO and GTA Stats and Sales -My heat maps made it to the news2013/08/02
http://recharts.blogspot.ca/2013/08/this-blog-inspired-article-in-canadian.html
http://recharts.blogspot.ca/2013/08/416905-condo-sales-and-stats-2013-08-02.html
http://recharts.blogspot.ca/2013/08/905-sfh-sales-and-stats-2013-08-02.html
http://recharts.blogspot.ca/2013/08/416-sfh-sales-and-stats-2013-08-02.html

#8 Spiltbongwater on 08.02.13 at 5:26 pm

When will prices be at the same point of when this blog started?

What is a “sale” in the minds of Realtors? I would think that July sales numbers should only include completed sales, or at minimum when the deposit is paid, the sale is reported as such. If “sales” is only when an offer is accepted, then the avg. of accepted offers that do not close, should be considered into the stats. But then again, these are the same Realtors who data mine DoM and listings that are delisted, are never considered to have happened.

#9 TO and GTA Sales and stats 2013-08-02 My heat maps made it to the news :-) on 08.02.13 at 5:30 pm

TO and GTA Stats and Sales 2013/08/02
http://recharts.blogspot.ca/2013/08/this-blog-inspired-article-in-canadian.html
http://recharts.blogspot.ca/2013/08/416905-condo-sales-and-stats-2013-08-02.html
http://recharts.blogspot.ca/2013/08/905-sfh-sales-and-stats-2013-08-02.html
http://recharts.blogspot.ca/2013/08/416-sfh-sales-and-stats-2013-08-02.html

#10 EB on 08.02.13 at 5:33 pm

One day, when the landscape is littered with the wreckage of this nonsense and people have wised up again, I really hope there’s enough political will to legislate some kind of responsibility where the industry is incapable of taking any.

#11 TO and GTA Sales and stats 2013-08-02 My heat maps made it to the news :-) on 08.02.13 at 5:39 pm

http://recharts.blogspot.ca/2013/08/this-blog-inspired-article-in-canadian.html
http://recharts.blogspot.ca/2013/08/416905-condo-sales-and-stats-2013-08-02.html
http://recharts.blogspot.ca/2013/08/905-sfh-sales-and-stats-2013-08-02.html
http://recharts.blogspot.ca/2013/08/416-sfh-sales-and-stats-2013-08-02.html

Thanks everybody for reading my blog and many thanks to Trevor for writing an article about my blog. Also a big ‘Thank you ” goes to Garth for allowing me to post my stats here

cheers
recharts

#12 jan on 08.02.13 at 5:40 pm

This whole fu$%^ng country is a Ponzi-scam .
And the government does not give one shit.
It makes me feel foolish for living an honest life and I probably deserve it.

#13 45north on 08.02.13 at 5:41 pm

GTA realtor Ross Kay ain’t buying it. He says the very data that local boards use is manipulated to distort sales, and this is then reflected at the national level.

Mark Hanson makes a point that in the US new sales are counted immediately whereas existing sales are only counted when they close. There is a pending period but in Canada even though existing sales obviously have a pending period there is never any mention of it. Why not?

Okay let’s say it. Real estate is by far the biggest investment in the economy. By a factor of 10 yet sales data is exactly what the real estate industry says it is.

the question is whether we’re in a sustained bull real estate market, or wobbling around at the top, ready to plunge. . It’s a question to which a prudent investor would seek an honest answer.

Sales figures shouldn’t be the preserve of those who have every interest in manipulating them. This could easily be regulated. A lot easier than the gun registry.

#14 Donald Trump on 08.02.13 at 5:57 pm

#149 Squatter on 08.02.13 at 5:18 pm

#146 Trump:
Can someone explain this to me….my head is spinning.

Scenario : A person wants to immigrate to Canada.
—Current terms is $800,000 invested over 5 years
—The loophole is they go to Quebec first.
—Quebec financial institution lends the immigrant the required $800,000.
—Then Quebec Gov’t gets to use the $800,000 for 5 years interest free for economic development(whatever that means)

So…the immigrant shows some evidence that they have $1.6 Million, but one way or another..lend the host province $800,000 ?.

Why would one allow them to borrow the $800,000 from a Canadian Bank? Why not insist they have $800,000 cash sourced externally ?

What the hell is going here ?

——————————–
You got it wrong, the IMMIGRANT lends the $800k for 5 years and doesn’t get any interest during these 5 years.
Wondering if he has to lend the money to a business?

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

Squatter…..you didn’t read the details.

The immigrant , at least if they choose Quebec, doesn’t have to bring in $800,000…only show net worth of $1.6 Million(say over-rated Harley collection)

So…the way I read it….if a non citizen, ….I wish to immigrate to CANADA…and follow the “rules”….. I seek the path of least resistance which appears to be Quebec.

So….I go to a Quebec bank…THEY lend me $800,000(at interest)…I lend it to Quebec Gov’t at ZERO interest for 5 years for “economic development”. Now, that Quebec banks would be insured by Canadian Taxpayers who live here, correct ?

Thus, to acquire citizenship….I show off my overrated Harley collection (appraised by some bearded author/blogger)…borrow $800,000 from a Canadian bank….I (and family) are in !!!

Then the Quebec Gov’t gives the interest -free Canadian bank loan $800,000 back….and all you are obligated to pay is the interest on $800,000 on Canadian Bank loan…which is really a pittance in the big picture and may even be deductible

Move to BC and Bob’s yer uncle.

#15 Van guy on 08.02.13 at 6:00 pm

I’m bearish like you Garth, but as a potential buyer in Richmond, listings are fading and prices have stabilized. I’m not seeing those huge discounts anymore. Even in the areas of terra nova, seafair, and riverdale areas that were getting smashed early this year, are now looking better. Honestly, the bears aren’t getting ahead here yet :(

#16 jaguar on 08.02.13 at 6:03 pm

CBC ran a documentary last night about how the government and media manipulated the facts during the Gulf War and then later during Sept.11th, etc. We think we have a free and forthcoming media in north America but that is not always the case. Facts get left out or the real truth submerged for lots of different reasons. If people knew what was coming I think there would be a little panic in the streets. But for those who pay attention to small details and sift through the information here and in other places, it seems clear there is a great reckoning coming. It is like Garth said…living a smaller life is the way to go. For all kinds of reasons.

#17 CrowdedElevatorfartz on 08.02.13 at 6:08 pm

I guess the bigger question is….
Why are these hucksters ALLOWED to lie?
Continuously spinning half truths, falsehoods and outright fabrication with impunity….
I can understand why the media lap it up. They are the lapdogs of avarice. Sniffing the testicles of the highest bidder.
But where the F*** are govt regulators in all this?
Not enough Canadian content on TV? Yup! Got an entire federal department for that.
Not enough french on tv? Yup got that covered.
Too many farmers producing too much milk? Shut them down pronto!
Toenail clippers in your carry on luggage at the airport! Stop the presses! Arrest that man!
Driving too fast! Parking too long. Smokers within 5 meters of a doorway. Dog off a leash. skatboards on a sidewalk…….

All very serious crimes no doubt.
But when Real Estate Organizations repeatedly obsfucate, exaggerate, or out right lie………. Nothing.

Surely to god there is some bureaucrat somewhere with the ability to shut the BS off.

#18 John on 08.02.13 at 6:31 pm

Edmonton stats aren’t fudged. It is different here, the strong economy, migration, and income numbers support these prices, end of story. Garth, can say what he wants but a SFH average price of 410K is sustainable and inline with growth and economic activity. 25% YOY increase, real numbers don’t lie.

Lemme see… It’s different in Edmonton, Toronto, Calgary, Vancouver, Saskatoon… This will be interesting. — Garth

#19 Godth on 08.02.13 at 6:39 pm

It really doesn’t matter anymore. When prices started doubling and people were running around like giddy children flipping and bragging I used to get worked up. My response could be summarised as “Holy [email protected]*K are you retarded!” That would have been what 2003-4-7? Now I’ve given up, totally pointless. They can spin the numbers any way they want and even if they’re true it only means the crash will be even more devastating.

It’s as though we’re on a train and upon the news that we’re on a collision course the conductor speeds up and the passengers order another round. The only thing I really have to say about this fiasco is – Congratulations Canada, you’ve just wiped out the middle class, well done. So now that success has been achieved – now what? Whaaa!

#20 Mark on 08.02.13 at 6:44 pm

And, as I have pointed out consistently, the realtors inflate their sales numbers by comparing unadjusted raw current numbers against adjusted historic ones. So as reported sales inevitably fizzle, current sales look more robust than they turn out to be.
—————-
Can anyone explain how these ‘adjustments’ work? I’m having a hard time understanding how raw numbers can be manipulated without the publishers of those numbers going to jail for fraud, manipulation, or misrepresentation

#21 Squatter on 08.02.13 at 6:44 pm

#15 Fartz:
I can understand why the media lap it up. They are the lapdogs of avarice. Sniffing the testicles of the highest bidder.
But where the F*** are govt regulators in all this?
——————————————————
They’re sniffing the butt of MSM maybe?

#22 Nosty in The Freak Show on 08.02.13 at 6:49 pm

#10 jan — “This whole fu$%^ng country is a Ponzi-scam .”

Correction — this planet is a giant ponzi scam. Not the planet’s fault, but there’s nothing that can or will ever be done about it.

Be of good cheer anyway! When the NMF, the Cascades, SAF, El Hierro, the three ‘quake faults and Mt. Fuji in Tokyo, the new volcanic chain just discovered up north some place, Yellowstone, Toba and Mt. St. Helens all wake up then shake, rattle and roll, that will separate the sheeple from us clueless nutbars!

#23 Godth on 08.02.13 at 6:52 pm

15 CrowdedElevatorfartz

They’re allowed to lie because the whole system is a lie. If the DEBT/CREDIT that banks issue doesn’t maintain it’s exponential upward trajectory the whole thing comes apart. 2007-8 marked the first deviation from that near perfect exponential curve in nearly 40 yrs., since Nixon blew off the last of the golden tether and went petro.

Look at the new housing scheme Osbourne has cooked up in the U.K.

We are on the verge, or rather in the midst of a massive shift in the way the game is played – globally. Most won’t know what hit them. Epic barely describes it.

#24 Donald Trump on 08.02.13 at 6:56 pm

#15 CrowdedElevatorfartz on 08.02.13 at 6:08 pm

I guess the bigger question is….
Why are these hucksters ALLOWED to lie?
Continuously spinning half truths, falsehoods and outright fabrication with impunity….
I can understand why the media lap it up. They are the lapdogs of avarice. Sniffing the testicles of the highest bidder.
But where the F*** are govt regulators in all this?

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

Very simple.

The tumour has always been there, its simply worked its way past the skin into broad daylight.

The front people are puppetts.

Via personal due diligence, I thought I would track my Local “elected” Gov’t Council. I reviewed all committee and Council meetings for 5 consecutive months.

I compared:
(i) Staff recommendations versus
(ii)Councils’ vote.

Not one single Staff recommendation was DENIED, and the vast majority were unanimously APPROVED by elected Council.

If you think the dim bulbs that get elected have an F’n clue…OMG.

Democracy and Accountability is an illusion…if voting actually made a difference it would be made illegal.

Like ” The Matrix ” choice : Red pill OR Blue pill

#25 John on 08.02.13 at 7:07 pm

Hey Garth

My post on Edmonton seems to have disappeared. Should I repost it or will you?

Posts appear after I review them. Keep your shorts on. — Garth

#26 X on 08.02.13 at 7:11 pm

“…the realtors inflate their sales numbers by comparing unadjusted raw current numbers against adjusted historic ones. So as reported sales inevitably fizzle, current sales look more robust than they turn out to be.” Garth

F really should lean on the RE cartels for doing this, they are after all leading the lambs to slaughter, which won’t help Poloz in his efforts to curb household debt.

#27 TurnerNation on 08.02.13 at 7:14 pm

Today’s layoffs: large commercial property management firm in Toronto. Lots let go.
Admin jobs to be outsourced.

#28 TurnerNation on 08.02.13 at 7:22 pm

Should I say: they are up sht brook without a paddle. Idiomatically-speaking.

#29 screwed on 08.02.13 at 7:23 pm

Stats are stats.

How many deals didn’t get written at the end of June because of the long weekend?

July sales are hot, hot, hot they scream.
Ok, so in reality June sales sucked bad because of the weekend delay.

Sales are up from 2012. Whoopiee! Duh! They built condos like there’s no tomorrow over the past year. Excess inventory is moving. Big deal.

However, the sheeple hear the news and that news forms their opinion that real estate is once again red hot and the only and best investment in town.

Don’t look any deeper than what the RE boards are reporting. Take their reporting at face value. It worked for so long.

#30 ???? on 08.02.13 at 7:24 pm

How long can they continue on manipulating the numbers??????

#31 Mister Obvious on 08.02.13 at 7:28 pm

#1 sunshine

“There should be an independent body Analyzing these numbers, don’t you think Garth?”
————————

There is… its called “greaterfool.ca”

#32 pathcontrolmonnk on 08.02.13 at 7:40 pm

Try telling this to someone in Vancouver, their eyes glaze over and their mind does the equivalent of a child covering their ears and chanting, “LALALALALALALA…”

#33 Cory on 08.02.13 at 7:47 pm

All that this never ending pumping that the professional liars will do is force Garth’s friend, Mr. Flaherty, to once again tighten and adjust the rules. But then, other than themselves, nobody ever said these “professionals” were smart.

I just wish this F guy would get some guts and crush this stupidity once and for all.

#34 DV01 on 08.02.13 at 7:56 pm

Sooooooooo, Vancouver was a solid beat, off of depressed levels last year, no BS, yes?

#35 Irene on 08.02.13 at 8:01 pm

#18 Mark:

And, as I have pointed out consistently, the realtors inflate their sales numbers by comparing unadjusted raw current numbers against adjusted historic ones. So as reported sales inevitably fizzle, current sales look more robust than they turn out to be.
—————-
Can anyone explain how these ‘adjustments’ work? I’m having a hard time understanding how raw numbers can be manipulated without the publishers of those numbers going to jail for fraud, manipulation, or misrepresentation

————-

The RE boards report a sale when an offer is accepted and any conditions have been waived. However, between that date and the date the sale closes (i.e. transfer of ownership), various problems can result in the sale being cancelled. For example, the buyer may have to back out because he could not get the financing he needed. The RE boards adjust the historical numbers to reflect these cancelled sales, resulting in final sales numbers which are about 3% below those initially reported.

The problem is that they then compare those historical numbers with the current numbers which have not yet been adjusted because many of the sales which will fall through have not yet done so by the end of the month. So the actual difference between any month and the same month the previous year is about 3% less than the RE boards report. If they claim sales are up 10%, it’s actually more like 7%, and if they admit sales have dropped by 2%, it’s probably more like 5%.

#36 Godth on 08.02.13 at 8:06 pm

32 Shawn

http://www.youtube.com/watch?v=NKkRDMil0bw

Only that which stands the test of time is true, we’re about to find out. The real question is: are there too few resources or too many people? “money” is rather irrelevent.

http://www.youtube.com/watch?v=GPj8D5KaPVU

#37 western observer on 08.02.13 at 8:07 pm

As I said in April.

No crash in Vancouver.

Mildest climate for a major city in Canada. Most attractive city in Canada. You can come here from anywhere in the world and you will find your culture & food. You will be accepted. You will feel safe. We do not have the gun culture of the states.

As the world changes Vancouver is establishing itself as a well to do safe neighbourhood.

As I have also said before Vancouver is like the San Francisco or Seattle of Canada.

San Francisco & Seattle real estate was not harshly affected like other areas of the states. In fact, the real estate in these cities has rebounded higher than before the crash. It is easy to find stats on Zillow.

There will not be a crash in Vancouver.

#38 Marginal on 08.02.13 at 8:11 pm

#15 CrowdedElevatorFartz
But where the F*** are govt regulators in all this?

#19 Squatter
They’re sniffing the butt of MSM maybe?
—————————————————————–
Based on political fundraising dinners, property developers are big money baggers for politicians. True for Ontario and those who found wings to the fed level. I would hazard a guess it’s true for Calgary as well, given recent MSM news of property developers meeting to see what they could do to install a more pro-development politician. Also, federally, I would suggest we are in an anti-regulatory era.

#39 valley renter chick on 08.02.13 at 8:17 pm

anyone have any opinions on my house buying strategy….
hubby and I are 33 with 2 little ones. We have been waiting for the market to drop before we buy. Problem is, we only have $50,000 in TFSA investment account & $55,000 in RRSPs. We anticipate spending about $350,000 on a house, probably in about four years, and likely in the BC Okanagan. I would like to have at least a 25% downpayment…so we are looking at needing about $88,000 for that. Is using RRSP mula as a first time buyer a good idea? I am guessing that DIY investing with the TFSA money is probably not a good idea (although I have seen decent returns thus far). Thoughts mi amigos?

#40 George on 08.02.13 at 8:18 pm

(Party on Garth)

Latest household credit numbers in Canada to the end of June 2013 from the Bank of Canada:

http://credit.bankofcanada.ca/householdcredit

Latest business credit numbers in Canada to the end of June 2013 from the Bank of Canada:

http://credit.bankofcanada.ca/businesscredit

#41 Grumpy on 08.02.13 at 8:21 pm

Canadian REBs don’t publish data on the quality of the houses sold, either. In any Canadian city housing quality ranges from new/properly reno’d, through ‘lipstick on a pig’ to ‘lovingly cared for/ opportunity to update.

Comparing prices only in any given post code doesn’t tell you much other than how high is up – and even that, as Garth has pointed out, is open to interpretation

#42 Freedom First on 08.02.13 at 8:22 pm

Through every RE crash in every country in Europe, the USA, Japan…….I saw the same verbal diarrhea of denial preceding each crash, from the same culprits, the RE industry, the msm, the politicians……soooooo, who am I gonna believe, them, or my own eyes? I have to say, the RE industry, and all of their cronies backing them up, look to me like they have been constipated for a long time…….Freedom First.

Garth. Thank you for your continuing to write nothing but the truth, backed up by the facts. The dark side hates you Garth, the nerve of you, trying to help people make sane financial decisions. To: Balance, re-balance, diversify, be liquid. That, is what works. Leverage, and on only 1 asset…..that is insanity. No exception.

#43 Observer on 08.02.13 at 8:25 pm

Yep if things are so good, let interest rates rise and stop the government subsidies.

Get rid of CMHC and let the pony ride

#44 Infused with opiates on 08.02.13 at 8:33 pm

I dont see the problem with the sales reported here:

http://www.vireb.com/assets/uploads/07jul_13_sales_summary_5118.pdf

I went back to July 2010 and they matched with the backdated stats from 2011-13 except for one.

#45 Fed-up on 08.02.13 at 8:45 pm

@#36 western observer

Dream on.

#46 Smoking Man on 08.02.13 at 8:45 pm

No koodos garth,

did I not tell you last year, when laughingcon was the favorite on here, that after the little F’S Mortgage tighten scheme market would soften, then MSM would blow sunshine.

Another grand prediction to completion.

If I wasn’t such an obnoxiously arrogant love thy self son of a bitch, I would have 1000 fans on here.

OK So I’m up to 15 fans.

I hate people anyway… Wouldn’t change a thing,

People don’t know what’s going on, they don’t even know that they don’t know what’s going on.

Enterprise minded, they are yours to exploit.

#47 Soylent Green is People on 08.02.13 at 8:53 pm

‘It is difficult to get a man to understand something, when his salary depends on his ^NOT understanding it.”

~ Upton Sinclair~~

……………………………………

PM Stephen Harper CON MP John Baird ordered illegal English-only gov. Business Cards in May 2011.

The cards were embossed with gold-coloured ink (also not allowed under gov. rules), and the word Canada was sharply reduced in size, leaving Baird’s name in the largest typeface.

Cost to tax payer $424.88.

http://www.theglobeandmail.com/news/politics/language-czar-asks-john-baird-to-get-rid-of-english-only-business-cards/article13571920/

o
o
o
o

#48 AK on 08.02.13 at 8:55 pm

#34 Irene on 08.02.13 at 8:01 pm
“The problem is that they then compare those historical numbers with the current numbers which have not yet been adjusted because many of the sales which will fall through have not yet done so by the end of the month. So the actual difference between any month and the same month the previous year is about 3% less than the RE boards report. If they claim sales are up 10%, it’s actually more like 7%, and if they admit sales have dropped by 2%, it’s probably more like 5%.
====================================
It sounds like “Redneck” accounting. :-)

#49 Honest! — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate | The Affluent Boomer on 08.02.13 at 8:59 pm

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

#50 broadway skytrain on 08.02.13 at 9:03 pm

Congratulations Canada, you’ve just wiped out the middle class, well done. So now that success has been achieved – now what? Whaaa!
———————————————————–

if , as our esteemed host often points out, 70% of cdns own these properties that have doubled and tripled, is not this the biggest boost to the wealth of the middle class in cdn history?

i sure know it is for my family. we are up about 1M (4x)on our RE purchases (made by dumb kids who knew just about NOTHING about RE, other than the one rule – locationx3) over 15 yrs.

using royal bank balanced funds (the most conservative funds offered by the largest FI in canada) supposedly the very best experts money can buy – we are up about 0 over the same time frame.

#51 Alberta Ed on 08.02.13 at 9:05 pm

The MSM is too dumb to know. And too lazy to find out.

#52 Nosty in The Freak Show on 08.02.13 at 9:07 pm

#32 Shawn — Ummm, it was a joke, much like this planet. Is it too complicated for you to understand?

#53 Marginal on 08.02.13 at 9:08 pm

#32 Shawn

You must be a RE for the garden of Eden. You paint a nice picture of continuous, linear growth; for which universe?
Ronald Wright has written a nice book called A Short History of Progress. I think Mesopotamian and Indus Valley civilizations were on the short end of the stick of your growth graph (deforestation and salination of farmland due to over-irrigation) as were all colonized countries (Aztec, Mayan, Belgian Congo, to be specific) when it came to the handout of goodies due to growth.
I think that is why people are questioning unbridled growth and using words like Ponzi scheme.
Maybe, you would be more comfortable with the phrase “shell game”?

#54 Chickenlittle on 08.02.13 at 9:20 pm

#16 John
“Garth, can say what he wants but a SFH average price of 410K is sustainable and inline with growth and economic activity.”

http://quickfacts.census.gov/qfd/states/00000.html

This site says the average cost of housing is $186,200 and average income is $52,762 in the US.

In Canada average income is $69,860 and housing costs $386,585 on average.

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil108a-eng.htm

http://www.cbc.ca/news/interactives/housing-canada/index.html

I like the US housing prices better. They have better weather than us, too.

I don’t understand how an $80k down payment and a monthly mortgage of $2,123.72 plus bills and repairs even remotely compares to a $36k down payment and a $1,722 payment. I’ll take the latter. $410 is still too much.

#55 AK on 08.02.13 at 9:23 pm

“And, as I have pointed out consistently, the realtors inflate their sales numbers by comparing unadjusted raw current numbers against adjusted historic ones. So as reported sales inevitably fizzle, current sales look more robust than they turn out to be.”
====================================
Okay. Enough of the speculation.

Here is how the REB comes up with their monthly numbers.

#56 Smoking Man on 08.02.13 at 9:23 pm

DELETED

#57 Godth on 08.02.13 at 9:31 pm

50 Shawn

Help is available.

http://www.amazon.ca/Lost-Science-Money-Mythology-Story/dp/1930748035/ref=sr_1_1?s=books&ie=UTF8&qid=1375493339&sr=1-1&keywords=the+lost+science+of+money

#58 western observer on 08.02.13 at 9:35 pm

@ #44 Fed-up

No dream – only stated verifiable facts.

#59 TheCatFoodLady on 08.02.13 at 9:37 pm

If the debacle with mortgage backed securities wasn’t bad enough… get ready for RENT based securities. Yup DeutscheBank & BlackStone Group, (which has bought up 31K foreclosed homes), are putting this one together.

Read it & weep:

http://www.thestreet.com/story/11997697/1/be-ready-for-renter-backed-bonds-and-meet-the-beneficiaries.html

#60 happy renter on 08.02.13 at 9:37 pm

Canadian familles pay so much for real estate all colluded by the big banks and big goverment to get its people as debt slaves.Its working alright,to bad it can be a burden on everyone’s health due to less money left in your pockets.It great for the pharmacuticalls so you just take a pill forget about it.

#61 HastingsSunriseMama on 08.02.13 at 9:37 pm

It doesn’t matter to me anymore if the Real Estate Market crashes or not. I’m glad to be a renter. I live well in Vancouver, work as much as I want to, and don’t stress about money. I love the freedom.

If you believe that Vancouver’s Real Estate Market is thriving, the business people at London Drugs might disagree with you. They recently cancelled a condo project in East Vancouver:

“Back in May, the decision was made to temporarily put the project on hold because, as you know, the real estate market in Vancouver is a bit challenged to put it mildly and we’re a family-based company. Therefore we try to make very prudent and conservative decisions,” explained Donna Figueira, director of real estate for London Drugs group of companies.”

http://m.vancourier.com/svc/wlws.svc/getHtml#article/?sectionId=713&feedId=1043&articleId=8524240

#62 TurnerNation on 08.02.13 at 9:38 pm

Just read the article. Picture reminds me of last night’s bar bill at the Ritz (at their ironically-named ‘Deq’ patio). Great live band , perfect service, best patio.
Beers are same price as Duke Devon’s though.

..
The Bay: sometimes, will drop by downtown of a Fri to try and hoop a deal (Old manishly).

It’s been rejigged into a quasi-bridal registry. $600 mixers. $2000 coffee makers. A whole mazing floor of Bedroom Collections. Pillow talk? That’s relegated
to a far corner. Got it? Déclassé’s over.
Now, waxing on 5th.

And the sweatshoppish Topman shop that’s overtaken – for naifs and waifs of any gender (apparently; there exists several…).

Beneath its retail patina there’s the heart of a consumer credit card business. Shades of GMAC. Richer than we think. The gematria: 3..2..1…

#63 valleyrenter on 08.02.13 at 9:44 pm

About the only thing I got from the realtorschpeil on Global tonight is that prices in Van are down, yet sales are up. Not surprising, first time in a while prices are down so seems more will rush in to buy. Smells like a Bull trap.

#64 Erasmus on 08.02.13 at 9:45 pm

Someone I trust says that the US housing market is currently in a bubble and is dropping off.

http://www.streetsmartreport.com/Real%20Estate%20Mini-Bubble%20Deflating%20May%20Be%20Economy's%20Next%20Problem.html

#65 Smoking Man on 08.02.13 at 9:50 pm

Garth I thought you had a harley, my mistake.

Deleted, why do you protect me man, let me be me.

Consiquenses be dammed, your afraid of the female back lash..

I got to teach you too…

#66 AisA on 08.02.13 at 10:07 pm

@#49

To clarify, you bought AND sold real estate and made a profit of one million dollars?

You’re not up anything until you book that potential profit. When I place a market order, I have the same ill feeling in my stomach whether that trade is gaining or losing value, nothing is over until all positions in the blotter are closed.

#67 Frogblender on 08.02.13 at 10:12 pm

So how do us honest folks stop the lying by the boards?

#68 OK Kingpin on 08.02.13 at 10:14 pm

If your livelihood and monthly BMW lease payments relied on making continuous sales.. and the fear of driving a Kia and missing next months credit card payments kept you awake at night, then of course you would be concerned about the “data”

#69 Sparky55 on 08.02.13 at 10:57 pm

http://www.viewpoint.ca stopped providing sold values today.

Stating: Sold “Not yet closed”.

I used to look at the sold values as an market indicator. Now this may be delayed weeks to months, and can only be checked for properties clicked on, not in a nice convenient list.

We will have to wait to see if they provide this data after it closes. Note that the close date is also not listed.

#70 LJ on 08.02.13 at 11:15 pm

The trouble with the listed statistics is that they have purposefully omitted the month over month changes. And, all of the papers and sources seem to have deleted links to them. I had to do some digging, but here are the stats for Calgary, with some nice graphs: http://www.creb.com/public/documents/statistics/2013/package/res-stats-2013_July.pdf

Please go to page 6 and following. Month over month things are not doing very well and the lower segments of the market (as Garth mentioned) are showing marked weakness while the upper end is strengthening. However, this has not helped the averages for the most recent period, likely due to the change in mortgage rates that hit like a hammer in June.

Yep, the “realtors” are pumping to try to get people back onto the boat before it sinks…

#71 Mark W on 08.02.13 at 11:31 pm

http://www.vancouversun.com/business/Lower+Mainland+property+sales+bloom+summer/8743878/story.html

You hear this and you hear dat ….

#72 ED on 08.02.13 at 11:41 pm

I have seen several homes in my neighbourhood in Nanaimo sold over the past few weeks–ones that had been sitting there for weeks and sometimes months. What does this mean?

#73 VanPerfecto on 08.03.13 at 12:08 am

Interesting
http://www.vancouversun.com/business/Quebec+immigration+program+stiffs/8739039/story.html

#74 Tom from Mississauga on 08.03.13 at 12:10 am

http://www.bramptonguardian.com/news-story/3908709-new-paint-shop-not-in-the-cards-for-brampton-chrysler-plant/

Media slurp up realtor press releases, but that the largest employer in Brampton might move production to Sterling Heights, Michigan by 2015 doesn’t get mentioned…

#75 andrew woburn on 08.03.13 at 12:20 am

#44 Infused with opiates on 08.02.13 at 8:33 pm

I have been following VIREB (Vancouver Island RE Board) stats for two years now and my impression is they try to present a reasonably balanced picture unlike some other boards. They seem to report sales/price declines with no spin. Of course, as in all small towns, relationships here are long term and honesty is a prudent investment.

#76 Dog on 08.03.13 at 12:25 am

#43 Observer
Wow, that about sums everything up.one of the smartest thing posted here.

#77 Retired WI Boomer on 08.03.13 at 12:49 am

Garth-

?I’m shocked by your comment “If things are so great why do they need to lie?”

In presenting statistics it is NOT lying, it id what is known as “data manipulation.”

One always takes data (not always equal), to make THEIR points more emphatic.

As a former MP you have no doubt witnessed this phenomena

#78 Marcus on 08.03.13 at 12:52 am

Lies abound….especially south of the border. http://www.zerohedge.com/news/2013-08-02/obamacare-full-frontal-953000-jobs-created-2013-77-or-731000-are-part-time

#79 Jamie on 08.03.13 at 12:52 am

Hi Garth,
it seems like I’m a world away here in Melbourne Australia however I’d swear you could edit out Vancouver and replace it with Sydney, Melbourne and we’d have our very own ‘Aussie Garth’. We are getting the same ol’ hot air from the media and RE agents about how the market is on the rise and we’d all better get on the first rocket ship to the top of the boom if we don’t want to miss out. Our heavy reliance on the ‘never ending’ China bubble is waning as our mining industry is beginning to drag on our economy. High debt, high property prices and obviously ‘high’ RE agents. Hide the snack folks, you’ll have the RE’s raiding your cupboards when the party’s over.
Jamie of Melbourne

#80 Marcus on 08.03.13 at 12:53 am

And good jobs = healthy real estate. The US real estate is not as healthy as one would hope.

#81 Lies lies and more lies on 08.03.13 at 1:31 am

Garth, I don’t know where you’re getting your numbers from but from what I’ve seen all houses in Markham are selling for over asking price. Houses that were $530k in Jan are now selling for $610-$625k.

Provide a link showing area homes have gained 15% in seven months. — Garth

#82 benchwarmers on 08.03.13 at 1:57 am

The flood was no disaster in Calgary, it created another mini housing boom, say the guys who sell houses.

http://www.calgarysun.com/2013/08/02/flood-boosts-home-sales-in-calgary-according-to-industry-reps

#83 Don in Kelowna on 08.03.13 at 2:56 am

If things are so great, why do they need to lie?

Gath, you could say something very similar about yourself.

That was evocative. So, where did I lie? — Garth

#84 Milla on 08.03.13 at 2:58 am

To John#17. Are you talking about Edmonton?
Bought condo in 2007 $320K , now it is 220K . How that makes Edmonton different?

#85 Martin Winters on 08.03.13 at 3:12 am

Would it be possible to include some references to back up your quotes? Much of your writing is ideologically driven – most notably your bizarre belief that the US economy is improving. If you could substantiate your claims you would have a lot more credibility.

#86 Stupesing in Cabbagetown on 08.03.13 at 6:57 am

I was channel surfing yesterday and came upon a good news story out of the U.S. A municipality (Buffalo? I tuned-in when the broadcast was already underway) had lifted a five-year hiring freeze and were hiring police, fire fighters and teachers. Why? According to the broadcaster, with the improving economy people are buying houses again which represents an influx of fresh property tax money into municipal coffers.

#87 jerry on 08.03.13 at 7:23 am

Bought my house for cash. Waterfront. Got a good deal and plan to live there then croak here many years from now.

My “bombastic bush-kin” investor advisor has made me aware (“aware”) that I could borrow the money back on a line of credit, tax deduct the interest payments and keep the principle amount in my investment portfolio. Not the “Smith Maneuver”. Dumb? Caution? Great?

#88 The real Kip on 08.03.13 at 7:34 am

I think they are pretty good numbers certainly for July, traditionally a quiet month in real estate, excellent numbers for GTA and elsewhere in our country.

Canada is not as weak and hopeless economically as many here make it out to be. No unemployed construction workers by the tens of thousands by summer as reported here, wow imagine that, a strong Canada.

#89 T.O. Bubble Boy on 08.03.13 at 7:56 am

Ok Garth… Are you trying to say that month-to-month stats are more relevant than year-over-year comparisons?

Pointing out that prices dip in the summer months is a bit silly, as average prices ALWAYS dip in the summer months:
http://guava.ca/indicators.html

I completely agree with the other points (that comparing “revised sales” from last year to “raw sales” from this year is incorrect, and that YTD sales would be a valid point of comparison), but pointing to average sales prices in July vs. earlier in the year ignores the very consistent seasonality in the market that has occurred every single year.

#90 Stickler on 08.03.13 at 8:14 am

@ 37 western observer on 08.02.13 at 8:07 pm

“San Francisco & Seattle real estate was not harshly affected like other areas of the states. In fact, the real estate in these cities has rebounded higher than before the crash. It is easy to find stats on Zillow.”

————-
>> Your statements made me curious…so I looked it up quickly.

You are not accurate. Here are the stats.
As per Seattle Times / & Zillow in 2010:

Seattle-area home values now are 28 percent below their June 2007 peak, Zillow said — a bigger decline than the 25 percent that values have dropped nationally since their June 2006 apex.

Nearly 28 percent of all owners of Seattle-area single-family homes with mortgages were “underwater” in September — they owed more to lenders than the houses are worth.

As of 2013 (now) per Trulia:
Seattle 3 BR:
3 bedrooms 5 years prior: $469,956
Now: $431,000 = after 5 years (2008) it is “worth” $38,956 less.

That is 8.3% less after 5 years. Add to that the actual “peak” was a year earlier, so down even more.

…so timing is everything.

The average price of a detached bungalow in Vancouver (Royal Lepage) $1,052,500.

SO if you think that it will preform like Seattle then it will be worth $87,000 less in 2018. Good luck with that.

As for San Fran, Vancouver is not comparable in my opinion.

#91 Oceanside on 08.03.13 at 8:58 am

Sales here on mid Vancouver Island are steady, even up a little from 2012 but the real estate people here state quite openly that prices are down 9% on average from last year, lots of sales
under $400,000. Different reporting than Vancouver or Toronto, sometimes its nice living in Smalleville, not so much hype.

#92 ottawan on 08.03.13 at 9:34 am

I have been keeping track of OTTAWA prices for the past 2 years, since we are renters. Each month I copy to my word processing document, the latest news from the local board. I have discovered a similar pattern as Garth has. In April 2013, the combined price was $371,565. May was $370, 501. June was $359,232 and July was $359,551. The six percent increase in July was because last July was an outlier with a drop to $337, 518. (January was 349,415).
I talked to an agent last week, because I was surprised that one of the high priced in-fill houses was sold in out area. He told me he believed that these near million dollar houses squeezed into awful locations (this one backs on a gas station on a main street), skewed the prices. There are no corresponding low prices. So the average price is NOT the average price, but is recorded higher.
I advise people to check out this site, http://www.chpc.biz/plunge-o-meter.html

or keep records monthly to get a month-to month record about where things are going.

#93 Uh Oh Canada on 08.03.13 at 9:45 am

“It was the artificial low interest rates and government approved mortgages that blew up the housing bubble.” – Peter Schiff regarding the US housing crash.

Sounds familiar doesn’t it? As America crashes for the second and far worse time, Canada will go down with it too.

http://canadaam.ctvnews.ca/u-s-addicted-to-monetary-heroin-headed-for-a-crash-schiff-1.1393694

#94 koshy Alex on 08.03.13 at 10:04 am

Nothing related to today’s post,but I think this is something that can happen in Canada

Australia unveils levy on bank deposits

http://www.bbc.co.uk/news/business-23544767

The article says the govt intends to impose it on banks not on depositors, but ultimately who is going to pay ????

#95 Realtors in financial pain(NO SLAES) on 08.03.13 at 10:05 am

Many realtors haven’t made a sale in over a year now . The RE industry knows the game is up and blowing as much smoke up the masses behide to sucker in as many dummy to their financial doom. The media will say whatever you want for money. Many realtors are doomed as some have even given up the dream of easy money for no working .

#96 Penny Henny on 08.03.13 at 10:05 am

Garth-The average price of a detached house in Toronto is $793,842. The realtors say this is “6.5% higher” than a year ago. But it’s down steeply in a month – 8.4% lower – one of the most significant monthly declines in years.
——————————————————-
Sorry Garth, but you were singing that same song last year and guess what?
Prices are up this year.
And prices will be up again next spring.

My statement is factually correct. Any buyer not taking seasonality into account with other factors can easily pay an unnecessary premium. BTW, you have no idea where prices will be in April of 2014. — Garth

#97 Derek R on 08.03.13 at 10:27 am

#39 valley renter chick on 08.02.13 at 8:17 pm wrote:
anyone have any opinions on my house buying strategy….
hubby and I are 33 with 2 little ones. We have been waiting for the market to drop before we buy. Problem is, we only have $50,000 in TFSA investment account & $55,000 in RRSPs. We anticipate spending about $350,000 on a house, probably in about four years, and likely in the BC Okanagan.

Well, VRC, biggest issue that I can see is that you risk violating Garth’s golden rule — Stay Balanced, Liquid and Diversified.

According to Garth’s Rule of 90, balanced in your case means having less than 60% of your net worth tied up in the house and that in turn means that you either need to increase your savings by another $160,000 during the next 4 years or you need to find a suitable house for $158,000 when you go house-hunting.

Anyway whatever you decide to do, I wish you the best of luck. None of us know for sure what will happen over the next few years and it may be that four years from now houses in the Okanagan will be in your price range. Here’s hoping.

#98 Penny Henny on 08.03.13 at 11:09 am

so what was wrong with my last comment that you didn’t even post it?
there was nothing derogatory, no insults.
Just a simple observation and prediction.
I would consider you as a consultant/financial planner but for that fact you find it so hard to admit you were wrong.
Must be hard to find a hat that fits over that ego.

You comment was posted when it was moderated. It was your second-to-last contribution to this blog. — Garth

#99 CrowdedElevatorfartz on 08.03.13 at 11:21 am

@#91 stickler
Great stats
Total agreement about the Vancouver – Seattle comparison.
Similar in location, population and one major industry towns.
Seattle and Boeing
Vancouver and …………….. never mind.

#100 Ogopogo on 08.03.13 at 11:22 am

#84 Don in Kelowna on 08.03.13 at 2:56 am
If things are so great, why do they need to lie?

Gath, you could say something very similar about yourself.

That was evocative. So, where did I lie? — Garth

C’mon, Don, we’re still waiting for an answer. If you truly live in Kelowna, as I do, you’d be able to sniff out RE-related lies faster than a fart in a windstorm. As it is, you’re probably just another frustrated, out-of-work realtor.

#101 CalgaryFloodBoom on 08.03.13 at 11:50 am

Lots of critical comments recently, are we approaching the tipping point I was musing about earlier?

#102 KommyKim on 08.03.13 at 11:51 am

RE: #95 koshy Alex on 08.03.13 at 10:04 am
Nothing related to today’s post,but I think this is something that can happen in Canada
Australia unveils levy on bank deposits

While the levy is small, it does set a dangerous precedent.

But we all know that bank fees and taxes never go up so nothing to worry about right?

#103 broadway skytrain on 08.03.13 at 12:00 pm

re – seattle prices

fact- if you bought a house in seattle anytime since 2000, there is about a 90% chance you are up, not down

http://www.trulia.com/real_estate/Seattle-Washington/market-trends/

if you timed the exact week of the exact month of 2007, to buy at the momentary very top of the market you are now down a whopping 10% – a much smaller drop compared to XRE.TO which has plunged over 16% in a few months.

pay attention.

#104 ponerology on 08.03.13 at 12:16 pm

What continues to astound me is that this is even allowed. If you replace the “realtor” with “investment advisor” or “stock broker” and repeat then they would be in violation of numerous laws (as well as the fact that one cannot “guarantee” a return on any investment/investment strategy beyond what is actually guaranteed in the investment itself).

#105 Godth on 08.03.13 at 12:21 pm

Fukushima, no end in sight.

http://femalefaust.blogspot.ca/2013/08/fukushima-is-about-to-get-really-really.html

#106 Donald Trump on 08.03.13 at 12:41 pm

#74 ED on 08.02.13 at 11:41 pm

I have seen several homes in my neighbourhood in Nanaimo sold over the past few weeks–ones that had been sitting there for weeks and sometimes months. What does this mean?

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

I am seeing RE sell as well over here in HAMville.

My guess is people that are house horny and still fiscally able to make the plunge are going for it.

However, that does not mean anything but economic Darwinism.

Those types of buyers will cull themselves, and more desperate sellers will begin to emerge.

#107 Ford Prefect on 08.03.13 at 12:46 pm

#44, Opiates and #76 Woburn: I have also looked at VIREB figures. They divide Vancouver Island into 7 zones, one of which is Comox Valley. If you add up listings taken directly from the MLS for the Comox Valley and compare that total to that shown in the VIREB compilation you will find a consistent understating of inventory of around 200 plus listings or around 20%.

July 2013: VIREB 970, direct from MLS 1,200.

#108 TheCatFoodLady on 08.03.13 at 1:06 pm

If individual agents & RE boards can whip potential buyers up into a buying frenzy that easily, it points to 2 things. It would seem buyers, first timers or ‘upgraders’ are buying into the “hurry, they won’t last long at these prices & you risk being priced out of the market!” Secondly, I think too many are hoping for the levels of appreciation their parents enjoyed & that SOME markets are still seeing.

I don’t think inexperienced buyers are running their own numbers & if they are, they’re not considering much other than down payment & closing costs. Carrying costs of all sorts aren’t examined. Future higher costs? Nope – they’re going by what they know or think they know – prices always go up.

Banks are still shoveling out mortgage money – of course they won’t take it on themselves to tighten criteria – little incentive if a mortgage holder defaults & if there’s a buck to be made…

Traditionally buyers were older, generally established in a job, married with kids & with a substantial down payment. It was not expected that the young, those really just starting out in adult life, would have the means to buy a home. Demand has been pulled forward to an almost ridiculous extent. Young twenty somethings; singles buying overpriced condos & in some cases homes of a size more suitable for a family. They want it all, the grainless, (granite/stainless), crowd, especially the master ‘retreat’ with the hot tub. I’ve always wondered, if you’re single or a young couple with no plans for children any time soon & buying as an ‘investment’ – what exactly do you need to retreat from? The bill collectors when you find yourself desperately house poor?

If demand has been pulled forward so much, if the population of the cohort behind them is smaller & is having trouble finding jobs anyway, who exactly are the next buyers? Immigration numbers aren’t that high. Even investors will find there are few to rent their investment homes/condos arfter a while. In many markets, that may result in downward pressure on rental rates.

Interesting times.

#109 Mister Obvious on 08.03.13 at 1:13 pm

If you needed an indicator that some people are having mortgage problems how about this:

Some dude in Coquitlam has turned his swampy back yard into an outdoor “Bali-Style creek side bed and breakfast”.

Essentially, he’s put a mosquito net around a bed in the weeds. $150 per night includes complimentary bottle of wine. Clothes optional.

http://vancouver.en.craigslist.ca/pml/vac/3977406438.html

(scary pictures, eh? Try and sell your wife on that.)

#110 Stickler on 08.03.13 at 1:16 pm

@ #100 CrowdedElevatorfartz on 08.03.13 at 11:21 am

@#91 stickler
Great stats
Total agreement about the Vancouver – Seattle comparison.
Similar in location, population and one major industry towns.
Seattle and Boeing
Vancouver and …………….. never mind.

—————-
>> Actually Seattle has even more BIG business (Boeing is now HQ Chicago btw)

Seattle area has Microsoft, Nordstrom, Amazon.com, Starbucks, T-Mobile, F5 Networks, Cray Supercomputers, Costco, Eddie Bauer, Weyerhaeuser , Expedia…and more.

#111 RoninBC on 08.03.13 at 1:20 pm

Just returned from visiting the greater Vancouver area. SOLD signs are way up over last year and there are cranes everywhere. Great times to be a construction worker.

Developers keep building and looking for more land for additional projects. They obviously have a different opinion on the future of RE in the lower mainland.

#112 Mike on 08.03.13 at 1:33 pm

I still don’t understand why people blame Garth for not buying a house. Ultimately you make your own financial decisions; you do not pay for this content. Even though house prices have gone up, had you listened and diversified, your money would have grown faster than the price of any house in the last 4 years.

All Garth has done was provide some sane advice; If all your net worth is in real estate, sell your home and diversify. This advice is ALWAYS true, only now more so than in the past. You may think of the equity that you’d have if you had purchased, but leverage is a double edged sword. Talk to someone who lost everything in the early 90’s. They will scare you straight.

#113 Daisy Mae on 08.03.13 at 2:21 pm

#78 Retired: “In presenting statistics it is NOT lying, it id what is known as “data manipulation.”

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

It’s deceitful. They are dishonest. Using trickery. Misleading the populace. In other words, they’re lying.

#114 Robert James on 08.03.13 at 2:40 pm

#110..Mr. Obvious.. I checked out that mud hole that the goof was trying to rent out.. Absolutely hilarious !! The sh*t people do for money !! The repo man must be closing in..lol

#115 western observer on 08.03.13 at 2:47 pm

re: #91 Stickler

I stand corrected on Seattle. However, 8.3% reduction is no crash.

To me Seattle Times / Zillow in 2010 is irrelevant to Summer 2013

You conveniently discounted San Francisco stats which supports what I said. Much higher values than the peak of 2007.

At the end of the day Seattle & San Francisco have recovered quite nicely.

People like to point to the States to support their crash theory but discount it when it shows otherwise.

I still say no crash coming to Vancouver. Only time will prove it.

#116 Old Man on 08.03.13 at 2:55 pm

#113 Mike – Mr. Turner listed his home a few years ago just outside of Toronto that was fully renovated with all the inside pictures, and was out of this world; not to mention his retirement home elsewhere. He prefers to rent at this time which costs him big money, but he knows what is coming, as is no fool just sitting back with cashflow, and laughing all the way to the bank.

#117 Donald Trump on 08.03.13 at 2:59 pm

#110 Mister Obvious on 08.03.13 at 1:13 pm

Bali ???? ROTFLMAO….at least add some tiki torches and a stuffed tiger. Amazing what a $50 investment at a garage sale can provide $150/night return

PS They should add that just down the street is the Pickton Farm

#118 Rainclouds on 08.03.13 at 3:08 pm

#112 Ronin “They obviously have a different opinion on the future of RE in the lower mainland.”

Uhh Maybe …..

As a resident I see full page ads every week in the local fishwrappers for projects that are foundering.

Bob Rennie (West Coast Brad Lamb) has some magic to perform: Keefer/Chinatown, Olympic Village, not selling.
Downtown/False Creek/Coal Harbour has lots of inventory and more NEW units coming on line in the next 12 months.
Projects cancelled in Hastings Sunrise…………

An open house on Hornby/Davie St THURS Morning was an eye opener. Realtor staring wistfully out the lobby door waiting for somebody to show up. Nada

Starting to get eeenteresting http://vancouverflippersintrouble.wordpress.com/

#119 Stickler on 08.03.13 at 3:21 pm

@ #116 western observer on 08.03.13 at 2:47 pm

You completely missed the point where Seattle fell more then 28% from peak. Call that what ever you want.

5 years + later it is still is down. You can make up what ever you want. It doesn’t make it true.

If a new buyer was looking to get in now on that 1 million+ Vancouver bungalow you would recommend them to do it?

I wouldn’t.

As for San Fran I didn’t look. Feel free to put up some numbers.

#120 Old Man on 08.03.13 at 3:25 pm

I see that the New York Times has just sold the Boston Globe at a 93% loss, as the publishing business and newspaper business is heading south due to the new world of the internet; no longer a good investment as many are in big trouble. There was someone in this room that said someone in Toronto went bankrupt a few years ago, and it was Key Porter, and was a house that had greatness for Canadian writers, but no more, independent authors had to self publish. I know as co-authored a book myself at one time with over 700 pages, and on the net sells for $500.00 a copy in mint condition.

#121 SilverMeridian on 08.03.13 at 3:28 pm

SilverMeridian Greater Ottawa surReal Estate Update

http://www2.ottawarealestate.org/home/NewsInformation/LatestNewsRelease.aspx

“Real estate boards in Toronto, Vancouver and Calgary this week issued media releases reporting higher sales and higher prices.” And those Real Estate boards  who don’t have anything to brag about are playing “Steady as she goes. No major fluctuations” game. For example, here is a headline from the Ottawa Real Estate Board News Release:

Steady as she goes. No major fluctuations for Ottawa resales.

“Although the number of residential properties, including condominiums, is down since last year, residential-class units sold increased 0.5 per cent from this time last year,” says Tim Lee, President of the Ottawa Real Estate Board. “The market has definitely cooled down since last year, as a result of the introduction of new mortgage rules by the Government. However, Ottawa remains balanced, and we are not seeing major fluctuations that other large Canadian cities sometimes experience.”

In order to be able make statements like the one above, OREB carefully chooses information they release to the public. At the first glance, everything is peachy – sales are only 2.7 % lower then the same month last year, average price is on the rise. Clearly, there is nothing to worry about, unless you look at the ballooning inventory of 7500 Active Listings (compared to 6500 just a year ago), or Residential New Listings sitting at 2700, compared with 2500 a year ago. Clearly, Ottawa market is getting saturated with overpriced junk that is not moving. Good luck with “No major fluctuations” thing.

#122 jess on 08.03.13 at 3:40 pm

eminent domain

write down or seize the mortgages..Mortgage Resolution Partners will provide the funding for Richmond to purchase the loans and also finance any litigation.

========
church of england vs payday lenders

Church of England admits investing in backer of payday lender …uk.reuters.com/…/uk-britain-church-lenders-idUKBRE96O0CG2013072…‎CachedJul 25, 2013 – Church of England admits investing in backer of payday lender … we’re trying to compete you out of existence”, according to an interview in the

http://mortgageresolution.com/

http://www.latimes.com/business/money/la-fi-mo-richmond-eminent-domain-20130730,0,7196420.story

#123 jess on 08.03.13 at 3:44 pm

bogus clicks 1/1000ths

‘Click farms’: how some businesses manipulate social media – Channel 4 Dispatches video trailer

http://www.theguardian.com/media/video/2013/aug/02/click-farms-social-media-video

#124 Stickler on 08.03.13 at 3:47 pm

@ #119 Shawn on 08.03.13 at 3:04 pm

A Ponzi scheme – is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation

So why do people think of our current system this way?

How about:

A Ponzi scheme – is a fraudulent investment operation that pays returns to its RETIREES / BUREAUCRATS INSERT GROUP HERE from their own money or the money paid by subsequent NOT YET RETIRED (OR BORN) CITIZENS’ FUTURE, rather than from profit earned by the individual or organization running the operation.

This concept can be seen in many areas of our society.

Don’t you think?

#125 Old Man on 08.03.13 at 4:00 pm

Now all Canadians can be proud as our Foreign Affairs Minister; namely the one and only John Baird who is a puppet and a clown at best, is telling us all that an Orange Alert has been issued like a script from the Ministry of Truth as al-Qaida is on the move, so be afraid and careful. Thank you Caesar as your puppets do well.

The past Home Security Head in USA went on the record that all the Orange Alerts was just propaganda at best, and the definition in the Arab world for al-Qaida means sitting on the toilet, so much for the known definition coming from a ultra conservative so called group of Arab radicals. I hope this is not going to become another false flag operation.

#126 Infused with Opiates on 08.03.13 at 4:15 pm

108 Ford Prefect – I did a search on realtors.ca for “Comox Valley” and returned 955 results, though the default looks to be what is defined as “residential”. I tried it twice, once by letting the site do the oeverall, and once where I zoomed to include Union Bay and Merville which are listed in the CVREB stats. Where did you find
the 1200 figure?

http://www.comox-valley-realty.com/assets/files/ComoxValleyGraphstats.pdf

#127 Waterloo Resident on 08.03.13 at 4:27 pm

HERE’S THE TRUTH; PURE HARD EVIDENCE.

http://stockcharts.com/h-sc/ui?s=XRE.TO&p=D&yr=3&mn=0&dy=0&id=p95696037966

That my friend is a 3-year chart of a very popular Canadian Real Estate Investment trust (REIT). They invest in Canadian commercial real estate.

Typically, when house prices rise, so does this REIT. As you can see, for most of the past 3 years it has been going up like a rocket.

Only since about May 2013 has it started to drop, and the drop is not stopping. This drop started about the same time the rates on Bonds started to go up as well.

My thoughts on this is simple:
1- Businesses in the USA start to improve and they need more financing to expand, this pushes bond rates up.
2 – Bond rates push up Canadian mortgage rates.
3 – As mortgage rates go up, house prices (and REIT prices like XRE.TO) go down.
4 – Canadians are slow to understand this, they don’t seem to notice what’s happening until about 12 months after the trend started. So Canadians probably won’t begin to understand that housing prices have started falling until some time NEXT SUMMER, some time around June 2014. Until then, everyone is going to be happy and expecting huge increases in home prices, they won’t feel as if anything has changed in the trend.

Come June and July 2014, more and more newspaper articles and media stories will be talking about the stalling in home prices, and people will begin to feel that something has changed, and they will begin to worry. That will be a more than 1 full year after the downward trend actually has started. (Started May 2013)

Nice speech, but there is no strong relationship between Canadian residential housing and REIT prices. REITs got slammed by the herd along with all other fixed-income assets and equivalents in June when bond yields rose, after a stellar increase to nosebleed territory. They are now on sale. Yummy. — Garth

#128 Squatter on 08.03.13 at 4:28 pm

#126:
A Ponzi scheme – is a fraudulent investment operation that pays returns to its RETIREES / BUREAUCRATS INSERT GROUP HERE from their own money or the money paid by subsequent NOT YET RETIRED (OR BORN) CITIZENS’ FUTURE, rather than from profit earned by the individual or organization running the operation.

This concept can be seen in many areas of our society.

Don’t you think?
—————————————————
I totally agree except it’s not fraudulent as you say, you’re talking about a perfectly legal Ponzi scheme.

#129 Yitzhak Rabin on 08.03.13 at 4:33 pm

Great detective work sleuth. Everything you say is 100% true.

Next you can tackle the numbers for US GDP, Inflation and Unemployment.

Remember, It’s different there!

#130 Fed-up on 08.03.13 at 4:48 pm

@#121 Stickler on 08.03.13 at 3:21 pm
@ #116 western observer on 08.03.13 at 2:47 pm

You completely missed the point where Seattle fell more then 28% from peak. Call that what ever you want.

5 years + later it is still is down. You can make up what ever you want. It doesn’t make it true.

If a new buyer was looking to get in now on that 1 million+ Vancouver bungalow you would recommend them to do it?

I wouldn’t.

As for San Fran I didn’t look. Feel free to put up some numbers.

——————————————————————–

Well I did look up San Francisco and Western Observer is full of it, yet again. Prices crashed over 40% (closer to 50%) from peak to bottom in good ol’ San Fran and have come nowhere close to recovering to the 2007 peak.

http://www.jparsons.net/housingbubble/san_francisco.html

Nice try though. Like I said Western Realturd-I mean Observer, dream on.

#131 Devore on 08.03.13 at 4:58 pm

#54 Marginal

I think that is why people are questioning unbridled growth and using words like Ponzi scheme.

Where around you do you see unbridled growth? Everywhere you turn, growth is being stifled and limited by all kinds of bounds, natural, man-made, and just plain made up. Maybe you want to define first what you mean by “unbridled”, instead of throwing trendy words around.

#132 Devore on 08.03.13 at 5:03 pm

On a separate topic, I’d love to also know on which planet this “unbridled capitalism” exists, that everyone seems to blame for all the world’s problems.

#133 DonDWest on 08.03.13 at 5:22 pm

“I totally agree except it’s not fraudulent as you say, you’re talking about a perfectly legal Ponzi scheme.”

Actually, if you follow the constitution – it’s illegal.

We have clauses in democracy that should grant minority protections. Meaning, the majority (e.g. the old) can’t simply vote to steal the money from a minority (e.g. the young). This is called mob democracy.

#134 jess on 08.03.13 at 5:34 pm

132 Squatter

development aid or taxes
which do you think keeps a ruling government more honest /civil?

======
“pent or pumped up demand”
How to Get a Council House (uk)

lack of affordable properties

The hour-long documentary followed council officers and families in Tower Hamlets, the east London borough where each week 24,000 people hope to get one of just 40 properties available.

http://www.telegraph.co.uk/culture/tvandradio/tv-and-radio-reviews/10217460/How-to-Get-a-Council-House-episode-one-Channel-4-review.html

Immigrants face five year wait for council house
23 Mar 2013
Council tenants can rent out spare rooms
03 Apr 2013
Fifth of council house tenancies found to have ‘indications of fraud’
21 Jan 2012
Rent becoming ‘unaffordable’
16 May 2013
‘My children share a room – it’s just common sense’
31 Mar 2013

#135 gladiator on 08.03.13 at 5:37 pm

Fresh HAM news from Toronto!

I was walking by TRIDEL’s office on Dufferin, south of Steeles today and I see a Sunny Tours bus stopping by and about 40 Asians getting off and entering this developer’s office. There were even 2 reporters or something like that – they videorecorded the group (and took pictures) as they went through the doors.
I kinda knew what was going on, but just in case, I approached the bus driver and asked what this all was about. He told me that all these people were condominium buyers, and that TRIDEL is known for building quality condos, that’s why they chose to buy from this company.

I know, it’s anecdotal evidence, but I saw it with my own eyes at around 5PM today, Saturday, and confirmed it with the bus driver. So, HAM is alive and well in Toronto and those waiting for a crash will have to be very and very patient, ’cause it ain’t happening soon.

Where were they from? China or Richmond Hill? Would you have raced over to the bus if they were white people? — Garth

#136 gladiator on 08.03.13 at 5:39 pm

And I’m not buying the idea that these were locals from Canada and it just happens that they are of Asian descent – they don’t buy condos by the busload.

#137 Julie on 08.03.13 at 5:53 pm

But here in the USA where the economy is booming everyone is buying homes again.

Oh wait…..

http://www.bloomberg.com/news/2013-04-30/u-s-home-vacancies-fell-in-first-quarter-from-prior-year.html

This is actually good news. — Garth

#138 Stickler on 08.03.13 at 5:53 pm

@ #132 Squatter on 08.03.13 at 4:28 pm

#126:
A Ponzi scheme – is a fraudulent investment operation that pays returns to its RETIREES / BUREAUCRATS INSERT GROUP HERE from their own money or the money paid by subsequent NOT YET RETIRED (OR BORN) CITIZENS’ FUTURE, rather than from profit earned by the individual or organization running the operation.

This concept can be seen in many areas of our society.

Don’t you think?
—————————————————
I totally agree except it’s not fraudulent as you say, you’re talking about a perfectly legal Ponzi scheme.

________
Not all frauds are illegal ;)

#139 chickenlittle on 08.03.13 at 6:20 pm

#38 Western Observer:

Are you actually serious?

I would take San Fran over Dampcouver any day of the week. Just because Vancouver doesn’t see a lot of snow doesn’t mean it automatically is the best city in Canada.

Montreal is the best city in Canada and then Toronto.

#140 Ford Prefect on 08.03.13 at 6:26 pm

#130: Opiates. I total up all of the listings on the MLS site for the 10 areas that make up the Comox Valley, from Black Creek in North to Fanny Bay in South, Hornby Island to East and Mount Washington to West. Take the figures straight from the MLS “realtor.ca/propertysearch.aspx. The process is somewhat tedious but you do locate all properties for sale in Comox Valley and not just what appears to be Courtenay, Comox and Cumberland as reported by VIREB.

Note this total does not include around 200 lots for sale through brokers that are not included in MLS nor does it include foreclosed lots that have MLS numbers but do not show up if you search for them on the MLS site by description, price or location.

#141 Marginal on 08.03.13 at 7:20 pm

#136 Devore
“On a separate topic, I’d love to also know on which planet this “unbridled capitalism” exists, that everyone seems to blame for all the world’s problems.”
——————————————————————-
These are good examples of what many would call unbridled capitalism.

https://en.wikipedia.org/wiki/Triangle_Shirtwaist_Factory_fire
http://en.wikipedia.org/wiki/2013_Savar_building_collapse

#142 Infused with Opiates on 08.03.13 at 7:26 pm

145 Ford Prefect – thanks, that is a lot of work. I might give it a go for my area.

#143 DreamingInTechniColour on 08.03.13 at 7:42 pm

Good reading….

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

#144 An Importation to Prop the Ponzi Scheme on 08.03.13 at 8:10 pm

This REIT bubble will not die soon – it is kept alive by the low interest rate. And Toupee Harpo clearly wants to keep it alive until past the election. If there is no external shock to trigger a recession he will succeed. But when the bubble will pop, it will not be a soft landing…

#145 gladiator on 08.03.13 at 9:15 pm

Haha! Garth, people from Richmond Hill taking a bus to go in a well-organized group to buy condos from a North York-based developer’s office… You’re embarassing yourself by stating this. You may not publish this and I’ll understand. I noticed that they wore different clothes, they were video-taped (for what purposes if not for more propaganda back in China?) – they looked different than Asians who live in Canada.
Yes, I didn’t clarify where they came from, but I had lots of contacts with Asians before and I even can tell if the person is Korean, Japanese, Taiwanese or Chinese. The Chinese have different haircuts, they wear clothes in a more conservative way, etc. I have no doubt that these were Chinese – I saw them and it was all clear to my trained eye. I have yet to see Caucasians going in a well- organized group to a developer’s office to buy condos, but it won’t happen in my lifetime, because for the time being China is the force.
And finally, just think for a moment: a group of people, whoever they are, need a bus to go somewhere to buy a condo, meaning to spend some hundreds of thousands on something. If they were locals, they would have driven cars, at least some of them. In this case, though, ALL of them got there by a charter bus.
I rest my case.

Now you’re scaring me. — Garth

#146 AK on 08.03.13 at 9:51 pm

Anybody interested in buying a Mall?

#147 An Cat Dubh on 08.03.13 at 9:53 pm

The govt/media complex is full of bovine excrement. I was talking with my sister last week about renting vs buying and investing in in preferred shares, and she still thinks owning is better. She said even if the house looses 50% of value you still have something. Wouldn’t it be better to have invested it somewhere else than a depreciating asset.
The real estate industry must have the same publicists as the climate change cultists have. Nothing in the news about record cold in the arctic, especially the left of left of centre Radio Ottawa, I mean CBC.
http://www.climatedepot.com/2013/08/03/unprecedented-july-cold-arctic-sees-shortest-summer-on-record-normally-the-high-arctic-has-about-90-days-above-freezing-this-year-there-was-less-than-half-that/
CBC1 should be funded by listeners like NPR is in the states. Sure it’s a weird station, but it’s funded by it’s listeners.

#148 AisA on 08.03.13 at 10:36 pm

@#74

No, not jealous at all. People can fawn over the perception of wealth all they wish. If it’s not booked, it’s not real. Some may have taken it as a suggestion to claim that “wealth” that has been created by nothing but perception and turn it into a reality, which is in fact NOT altered by perception.

Yeah.

#149 Realist on 08.03.13 at 10:49 pm

Mainstream society is definitely unaware of any issues within the housing market. I know in AB it is only positives and not many media reports of any downturn in prices of houses or sales. In fact it is quite the contrary where a continuance in good sales and prices seems to be the topic of discussion on radio, tv, and newspaper. I took lots of courses in math and statistics in University and am well aware numbers can be manipulated for a time frame. Then used accordingly with data collected and used in a report to be used as good or bad news. That being said, I recall in the early 90’s at the peak of the last real good recession in AB where times where definitely not great. The media was all over housing, job losses and it was very negative media. It is amazing in this time period absolutely no negative housing reports that are mentioned by the media. It seems most people are very bullish on housing. I do agree with Garth on an overvalued housing market. When will the housing market gets bearish in mainstream society?

#150 KommyKim on 08.03.13 at 11:02 pm

RE: #152 An Cat Dubh on 08.03.13 at 9:53 pm
The real estate industry must have the same publicists as the climate change cultists have (Bla bla bla) (http://www.climatedepot.com)

Marc Morano’s Climate Depot is sponsored by the “Committee for a Constructive Tomorrow”, an Exxon funded think tank. Marc Morano was a producer on Rush Limbaugh’s show in the early ’90s.
Nuff said…..

#151 Smartalox on 08.03.13 at 11:41 pm

HEY! Did anybody notice that F’s office quietly announced that the Canadian federal (Harper) government and the Ontario provincial government are planning to liquidate their holdings in General Motors?

The governments bailed GM out back in 2009, to the tune of $9.5 Billion, claiming that they were ‘investing’ in Ontario. When ‘new GM’ had an IPO in 2010, the governments sold 35 million shares at $33 per share, to net $1.15 Billion.

With Friday’s announcement, the governments plan to liquidate their remaining shares, for an estimated $5.1Billion.

$9.5 billion – ($1.15 Billion + $5.1 Billion) = a loss of $2.9 BILLION!

You can read about it here: http://www.bloomberg.com/news/2013-08-01/canada-planning-to-sell-stake-in-general-motors.html

You can ONLY read about it there, because the story broke on the Friday of a sunny summer long weekend, and it would appear that the media are doing keg stands at the cottage.

How can F permit this boondoggle? Well, GM Canada is the single largest employer in his riding, and has its head office located there. But that can’t be the case, can it?

The brilliance of it is that no politicians are going to protest: The Ontario tories won’t attack the provincial liberals, because they risk offending their buddies in Ottawa, and the federal liberals won’t complain, because the Ontario party doesn’t need another scandal.

And the NDP are just happy that a few hundred union jobs were saved. They probably would have done the same thing, if they’d been in charge, anyway.

#152 Smartalox on 08.03.13 at 11:43 pm

Sorry, correction, it adds up to a loss of $3.3 Billion, not $2.9 Billion.

#153 western observer on 08.03.13 at 11:48 pm

re#134 Fed-up

My source is Zillow- San Francisco home prices and home values.”Sale price ” option.

June 2007 – $831,000
May 2013 – $866,000

Your chart shows inflation adjusted and nominal prices. Not sales.

re: #144 Chickenlittle

I never mentioned snow in regards to Vancouver. I did however mention other points that are valid. I’m sure Montreal & Toronto are nice places but they don’t have the natural beauty of Vancouver nor do they have the mild climate.

I still say Vancouver will not crash.

Time will prove this to be true.

#154 Donald Trump on 08.03.13 at 11:53 pm

#150 gladiator on 08.03.13 at 9:15 pm

=======

Yes…..we must remember that we are all equal and children of mother earth , at one with everything.

PS Not worried about the passengers..WHO was driving the damn bus ?

#155 Patiently Waiting on 08.04.13 at 12:00 am

Something seems really wrong here. I have just checked the sales on the Greater Vancouver Real Estate Boards computers and here is the data:

Total Residential
Detached & Attached
Sales by Year
—————————————————————–
2013 1862

2012 1814 (July 2013 is 2.6% above this)

2011 2454 (July 2013 is 24% below this)

2008 1878 (July 2013 is 1% below this)

Total Residential Sales (Detached & Attached) for June 2013 were 2611, so July numbers are actually 29% below June 2013.

WTF is going on …?

pw

#156 Roy on 08.04.13 at 12:14 am

“Sales Soar in July”

More like stats hide the cartel lies.

It seems maybe more a case that sales look “hot” because they are being compared against July 2012 sales, which is when sales began to collapse due to mortgage rule changes.

So obviously by comparison then sales seem stunning.

Even the Vancouver Sun article tries to tie the month of record sunshine with sales. Yes, it was sunny for a whole month therefore our statements about blooming sales must also be true.

Blue line versus light green line, first graph

http://housing-analysis.blogspot.ca/2013/08/greater-vancouver-market-snapshot-july.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+HousingAnalysis+(Housing+Analysis)

#157 Raf on 08.04.13 at 1:18 am

I dare you start a lawsuit. If you really want to help your country and be remembered for something big. And if what you say is right, then sue for fraudulent data and advertising.

#158 TheRealTruth in Scottsdale on 08.04.13 at 2:36 am

You blog dogs still waiting for a crash? I’m here on camelback road in Arizona and can tell you my property here has gone up by about $250,000 in the last 18 months!!:)

Told you guys to buy back then (look at the archives)…

Also, inflation coming to USA…everyone talking about it on the street…buy RE assets now!

Garth, I will be in La Jolla in 2 weeks. Very pricey but want to buy there. What do you think?

#159 T.O. Bubble Boy on 08.04.13 at 7:17 am

@ #140 gladiator on 08.03.13 at 5:37 pm
Fresh HAM news from Toronto!

I was walking by TRIDEL’s office on Dufferin, south of Steeles today and I see a Sunny Tours bus stopping by and about 40 Asians getting off and entering this developer’s office. There were even 2 reporters or something like that – they videorecorded the group (and took pictures) as they went through the doors.
I kinda knew what was going on, but just in case, I approached the bus driver and asked what this all was about. He told me that all these people were condominium buyers, and that TRIDEL is known for building quality condos, that’s why they chose to buy from this company.
————

This is a fairly typical sight, especially in downtown Toronto and Richmond Hill/Markham.

In case you hadn’t noticed, condos are the investment of choice for a large number of Asians – both local and offshore.

Concord Adex (developer of all those CityPlace condos beside the skydome and in North York /Richmond Hill) is a Chinese development company, and has made a KILLING selling tens of thousands of condos to the Chinese community, including all of those pre-build “assignments” that get flipped regularly and avoid tax.

Many of the rentals in Cityplace are owned by offshore $$$, and local (Chinese) property management companies handle finding renters etc.

So – my point is: you didn’t discover some secret new HAM bus… Toronto’s condo bubble has been driven by Asian money (both local and offshore) for 10-15 years.

Is wealth earned working at a job in Toronto by a Canadian-born person of Asian heritage called ‘Asian money’? Stand back and listen to your own words. Distasteful. — Garth

#160 The Man From Nantucket on 08.04.13 at 8:54 am

#156 Smartalox on 08.03.13 at 11:41 pm

$9.5 billion – ($1.15 Billion + $5.1 Billion) = a loss of $2.9 BILLION!

How many jobs at that Oshawa plant, anyway? Couple thousand?

If I take a really liberal interpretation, maybe 10,000 spin-off jobs in the area?

Front-loaded payment of $290,000 per job.

Why not just let GM go tits up, let the free market figure out what to do with the pieces. Then you could give each of the workers a large chunk of loot to let them figure out how to re-train, relocate, or retire.

Worst thing is going to be in a few years when GM gets themselves into trouble again and comes cap-in-hand.

#161 CrowdedElevatorfartz on 08.04.13 at 9:46 am

@#113Stickler
good one! I stand corrected.
But Vancouver has Gregor Robertson!
Surely we’re the best place on erf……

#162 Bob123 on 08.04.13 at 10:02 am

The real estate sections of the local Metroland paper, north of the GTA, are the slimmest in memory. Four or six pages in recent weeks. Quite a number of price reductions in the ads but I do see some sold signs around but, not surprising, if you’re going to move before school starts.
Things are odd. House down the street from me. Good solid 70’s bungalow hasn’t moved in 18 months despite three price reductions. Huge lot and excellent workshop too.

#163 The American on 08.04.13 at 10:12 am

At #88: Martin Winters, allow me to help you better understand this bizarre notion the U.S. economy is improving. Here’s some references for you:
http://www.bbc.co.uk/news/business-23466886

http://www.bloomberg.com/news/2013-07-01/mobius-sees-u-s-economy-improving-after-stock-
market-recovery.html

http://articles.latimes.com/2013/mar/14/business/la-fi-improving-economy-20130315

http://www.mlive.com/auto/index.ssf/2013/07/improving_us_economy_helps_sup.html

http://www.bloomberg.com/news/2013-06-27/asian-stock-futures-advance-on-signs-u-s-economy-improving.html

http://articles.economictimes.indiatimes.com/2013-08-03/news/41033891_1_james-bullard-u-s-economy-growth-targets

http://www.cnbc.com/id/100861173

http://www.nytimes.com/2013/07/03/business/economy/us-factory-orders-suggest-manufacturing-is-improving.html?_r=0

http://www.pri.org/stories/politics-society/government/latest-figures-say-u-s-deficit-declining-economy-improving-13955.html

http://www.israelnationalnews.com/News/News.aspx/170026

Geeesh, read much? Live under a rock? Don’t have electricity to turn on a television? You might want to consider what’s going on in your own country. Information is not as transparent in your neck of the woods, so you really do have to search for it….

http://www.thespec.com/news-story/2194566-canadians-doing-worse-than-country-s-economy-well-being-study-finds/

http://beta.fool.com/ashit04/2013/07/09/moodys-downgrade-of-the-canadian-banking-sector-do/39531/

http://www.cbc.ca/news/business/story/2013/04/09/business-bleak-outlook-capital-economics.html

http://oncampus.macleans.ca/education/2013/04/05/canadian-economy-sheds-54500-jobs-in-march/

#164 CrowdedElevatorfartz on 08.04.13 at 10:21 am

Garth, sorry to bug you on a longweekend.
Any comment on the revelation that the majority of US “jobs” numbers increases are “part time/ low paying jobs”? I believe the reporter mentioned 70% of the jobs.
Is this numbers “fluffing”? To make a soft recovery look better than it actually is?

#165 Happy Gay Pride Parade - Van on 08.04.13 at 10:40 am

Here is a link from the National Post – story is about F’s To-D0 List:

http://business.financialpost.com/2013/08/03/flahertys-unfinished-business-slaying-the-deficit-biggest-and-most-elusive-check-left-on-to-do-list/

Here is a quote from the story…….

“Also on the list are additional reforms to Canada Mortgage and Housing Corp., which has seen its mortgage liabilities skyrocket in recent years.”

#166 Mister Obvious on 08.04.13 at 11:13 am

#154 Realist

Good observation. The dynamics of the real estate business is the same as it ever as. It’s the agenda of the reporting media that’s different these days. That’s why many of us choose to hang out here.

#167 AK on 08.04.13 at 11:27 am

#169 CrowdedElevatorfartz on 08.04.13 at 10:21 am
“Any comment on the revelation that the majority of US “jobs” numbers increases are “part time/ low paying jobs”? I believe the reporter mentioned 70% of the jobs.
Is this numbers “fluffing”? To make a soft recovery look better than it actually is?”
====================================
The U.S. recovery is real.

You should stop reading useless propaganda. Now get out of the elevator and get some fresh air.

#168 Siva on 08.04.13 at 11:31 am

#160 Patiently Waiting on 08.04.13 at 12:00 am

Sales coming to a screeching halt. Remember Garth once posted the actual date real estate market died was May 18 (or was it 16? One of those two days). We are seeing the numbers now.

That was the forecast of GTA realtor Ross Kay. — Garth

#169 Revisions To Inflate Sales? | Calgary Real Estate Review on 08.04.13 at 11:41 am

[…] Friday, Garth Turner leveled some serious allegations against  real estate boards and the statistics they release.   I have to take issue with this […]

#170 James Joyce on 08.04.13 at 11:44 am

Garth: And, as I have pointed out consistently, the realtors inflate their sales numbers by comparing unadjusted raw current numbers against adjusted historic ones. So as reported sales inevitably fizzle, current sales look more robust than they turn out to be.
For example, that 16% sales increase in July was ****** actually 11.2% ****** more than reported a year ago.
——————————–
Huh?

This number is easy enough to check, since all of the PR’s are archived.
From the TREB PR’s.
July 2012 7,570 sales
July 2013 8,544 sales
Increase is 8544/7570=1.128= 12.8% increase

Where did you get 11.2%?

Here are the links to the 2 releases.

http://www.torontorealestateboard.com/market_news/release_market_updates/news2012/nr_market_watch_0712.htm

http://www.torontorealestateboard.com/market_news/release_market_updates/news2013/nr_market_watch_0713.htm

#171 Happy Gay Pride Parade - Van on 08.04.13 at 11:54 am

Hi. Maybe this is OT (off topic) for this blog?

I post this story, for your consideration. If you’re interested.

(FYI – society is not really divided by the 99% who are against the 1%…..society is not really divided like that.)

The rise of housing over the past decades helped contribute to the rise of the Canadian “Middle Classes” (lower/middle/upper)…..

Below is a link about:

Politics and the shrinking middle class
Jul 1, 2013

http://www.ipolitics.ca/2013/07/01/politics-and-the-shrinking-middle-class/

#172 CrowdedElevatorfartz on 08.04.13 at 12:29 pm

@#172 AcK
The U.S. recovery is real.

You should stop reading useless propaganda. Now get out of the elevator and get some fresh air.
++++++++++++++++++++++++++++++++++++

apparently you havent been watching the news.

As for my environment.
Why would I leave?
The temp and humdity are perfectly controlled by my “heat pump”.

#173 Old Man on 08.04.13 at 1:05 pm

Farming Update: The other day this was a Real Estate topic, and specialization is the key. I knew what to look for and this small farm is located north of Toronto in the Lake Simcoe area. The farmer has a limited assortment of products which he retails on the web, and at his retail store going for like $35.00 per lb., and sells by delivery to Toronto.

His phone is ringing off the hook, as the demand is high for upscale restaurants and specialty stores, so a very small farm can become a profit storm, as he and his wife have been making big money for years. It is the same old story to never follow the herd with competition, but find a demand that nobody has or wants, and supply it for a premium.

#174 Canadian Watchdog on 08.04.13 at 1:17 pm

A surge in sales during a month that should be winding down and the bulls are calling a trend reversal. Relax. There's a logical explanation according to CREA.

TD Economics: Toronto and Vancouver housing reignite in July PDF

The recent strength, however, is likely to prove temporary. CREA has attributed some of the strength in sales over June and July to households bringing sales forward to take advantage of low interest rates, as banks recently announced increases to mortgage interest rates. Banks have increased mortgage interest rates, with the special five year closed rate increasing 60 basis points since mid-June. Homebuyers with a pre-approved mortgage are likely jumping into the market to take advantage of record low interest rates.  

Overall, we expect to experience some pay back in August and September from the recent strength in sales and higher mortgage interest rates.  

h/t vancouvercondo.info

What's more revealing is that sideline-buyers are more concerned about the size of their monthly payment then the risk of losing money on an overvalued asset. That's the level of thinking we're at and perhaps the reason why us bears underestimate how irrational this market has become.

In short, the downward trend is still intact.

#175 AK on 08.04.13 at 1:29 pm

#176 CrowdedElevatorfartz on 08.04.13 at 12:29 pm
@#172 AcK
The U.S. recovery is real.

“apparently you havent been watching the news.”

====================================
I get my information from my American friends. It’s real and a lot more reliable.

What news are you talking about? The Star? LMFAO..

#176 Old Man on 08.04.13 at 1:32 pm

I will never forget the day that got a call from a farmer in Georgetown who paid cash to build his mother a home on the hill. He could not get a mortgage based on his financial statement, but wanted a 70% loan against appraised value back in the 1970’s. I said no problem as need an AACI report, and will get you prime rate with an Insurance Company; need not any financial statements or a credit check.

I went to his modest farm operation which involved a series of greenhouses growing plants and flowers for the Toronto market. The guy was about 35 years old, and signed him up for 3 points brokerage on a 5/25 at a rate below the what the banks offered, and the home in question was a beauty on severed land coming in at $150,000. Then I saw his car which he owned which I had never seen before, and it was a Bricklin, so some farming pays, but his financial statements showed a different story. :)

#177 T.O. Bubble Boy on 08.04.13 at 1:33 pm

I will avoid being distasteful here… simply post what the Financial Times is reporting in the UK:
http://www.cnbc.com/id/100936450

“Foreign buyers accounted for nearly three-quarters of new home purchases in inner London in 2012 compared with 27 percent for U.K. buyers, according to data from Knight Frank, the property group. More than half of the homes were sold to buyers from Singapore, Hong Kong, China and Malaysia.”

Not saying that Toronto is even close to London… but it isn’t on a different planet either.

London’s an international city, considered to be the ‘crossroads of the world.’ Toronto? Not so much. — Garth

#178 T.O. Bubble Boy on 08.04.13 at 1:38 pm

For those “millionaires” holding one or two primary investments like Gold or Real Estate (or, apparently Potash):
http://www.cnbc.com/id/48862894

#179 Julie on 08.04.13 at 2:08 pm

“Crash and Burn eh Mav?” (Stephen Harper)
“Slider…..you stink” (voting public)

BEST SCENE in Top Gun !! F-35 to crash and burn (as it should)

Seems we the vocal taxpayer have been correct all along. I hope the idiot Harper lowers our taxes and does the right thing CANCELLING these flying death machines that we do not need unless we wish to continue around the world invading other countries with the American Govt (not the public who are against it)

http://rt.com/usa/pentagon-f35-stealth-bomber-963/

#180 Julie on 08.04.13 at 2:18 pm

Is wealth earned working at a job in Toronto by a Canadian-born person of Asian heritage called ‘Asian money’? Stand back and listen to your own words. Distasteful. — Garth
————————————–

Garth give it a rest already. I think I speak for many people that say “it has NOTHING to do with race or investing”. Its the fact that offshore money (WHEREVER it comes from) shuts out 4th generation Canadians like me from ever buying someplace desirable because the prices are pushed up through the roof. That as always been the sticking point whenever I talk to people or hear call in radio shows. Now is that capitalism? I guess so? But MANY countries put controls on this to protect their people. Why do you think there is so much investing here? Because Kanaduhhhhh does not give a crap about its own people. Govt workers care about their job and politicians care about getting re-elected.

Good thing for us those days are coming to a fiery end to the dismay of all of us. Its going to be ugly starting 2015.75

#181 Old Man on 08.04.13 at 2:39 pm

I will give my humble interpretation on the above noted picture as the Loose Moose on Front Street is well known for attractive women who are looking for a good time, and a man who is a highroller in life. This means the Smoking Man was there, and he is the one who left the big tip, but hit the wrong stats on his Credit Card.

#182 Julie on 08.04.13 at 3:09 pm

Canada is not as weak and hopeless economically as many here make it out to be. No unemployed construction workers by the tens of thousands by summer as reported here, wow imagine that, a strong Canada.
——————–
What kind of construction? Cuz if its road construction those are govt jobs which is wealth taking not creating. Govt requires taxes which is the antithisis of wealth .

#183 father on 08.04.13 at 4:15 pm

Hey canadian watchdog (It’s great to have you back)

#184 CrowdedElevatorfartz on 08.04.13 at 4:39 pm

2#174 AcK
“I get my information from my American friends. It’s real and a lot more reliable.”

++++++++++++++++++++++++++++++++++++

Would those friends be the ones with full time jobs?

Because THAT was the question I was asking.
Not if the US is in recovery.

What is the percentage of full time jobs vs part time/ minimum wage jobs reported by the US feds.

The jobs numbers by the US Bureau of Labour reported are up.http://www.google.ca/url?sa=t&rct=j&q=us%20job%20stats%202013&source=web&cd=5&cad=rja&ved=0CEsQFjAE&url=http%3A%2F%2Fwww.bls.gov%2Fnews.release%2Fpdf%2Fempsit.pdf&ei=Lrr-UZSmHeSUiALZyoCgCg&usg=AFQjCNFzloU0TYyxyw-yv6dI51s0y7d2rQ

Significantly in Food and Service sectors
(minimum wage… me-thinks). And Part Time positions ( Retail).
The amount of “dissappointed workers” ( given up and have stopped searching) has risen….

So before you start bragging about your mythical friends in the US that mean about as much to me as most news paper chains

Please answer the question that I asked.

LMFAO

#185 CrowdedElevatorfartz on 08.04.13 at 4:54 pm

DELETED

#186 Pulp Faction on 08.04.13 at 5:08 pm

Everybody appreciates a generous tip, but reel it in would ya ?
You’re making me look cheap !

#187 dienekes on 08.04.13 at 5:59 pm

137 Don West
Democracy leads to Tyranny

#188 Shawn on 08.04.13 at 6:47 pm

GOVERNMENT CAN SO CREATE WEALTH

Julie at 186 says:

Cuz if its road construction those are govt jobs which is wealth taking not creating. Govt requires taxes which is the antithisis of wealth .

*****************************************
That is a common but mis-guided view.

Yes there is waste in the in government and often the private sector could do it cheaper.

In the case of road construction most of the work of the actual construction is contracted to the private sector.

Basically a road creates wealth if its value and utility is greater than the value of the inputs that created the road.

That is the formula for a all real wealth. Output is of greater value than the value (cost) of the inputs. (And cost should be based on the opportunity cost of using the inputs in a different project, if greater)

If that equation is satisfied then wealth is created and it does not matter if the entity creating the product, service or asset is government or private.

The above is logic, what you provided was more like rhetoric. Don’t believe everything you read. Consider the logic of arguments.

#189 James on 08.04.13 at 6:49 pm

US is in recovery because of the way they measure recovery. But they are blasting in 80 billion a month from gov. Doesn’t mean the stock market won’t temporarily improve and it doesn’t mean you can’t make money. But it also doesn’t mean it’s a real recovery. There has never been a recovery with such bad employment numbers. Printing money – this is the easiest debt strategy, and the one with the greatest moral hazard.

When the money printing stops, things will not look so great. Hopefully you smart folks out there make some dough in the meantime.

#190 Macduff on 08.04.13 at 6:52 pm

On a completely different topic, Garth, what is your take on the 2013 budget item on page 145, namely the “bail-in”? Is this an attempt to gird for a potential bank disaster in Canada? Seems more in line with what is happening in places like Cyprus.

Nothing to do with Cyprus. Covered here months ago, when it was news. — Garth

#191 The real Kip on 08.04.13 at 7:10 pm

“#186 Julie on 08.04.13 at 3:09 pm
Canada is not as weak and hopeless economically as many here make it out to be. No unemployed construction workers by the tens of thousands by summer as reported here, wow imagine that, a strong Canada.
——————–
What kind of construction? Cuz if its road construction those are govt jobs which is wealth taking not creating. Govt requires taxes which is the antithisis of wealth .”

Julie, there is plenty of construction work in roads, infrastructure, high rise residential as well as ICI (commercial) and the industry in GTA is running flat out in all sectors. This will not change for at least all of 2013.

Hey, don’t believe me? Open your eyes, take a look, and see it for what it is, there’s lots going on.

#192 Smoking Man on 08.04.13 at 7:18 pm

Quite boring when I’m not posting,

The whole summer’s been boring, Vegas, boating, ladies of the night booze and gambling.

Will ET finally beam me up, and take me for a ride.

Smoking man offspring Inc. Week 1

Son 1 going to Halifax to start up ADT office.
Son 2 spent 60 bucks rock garden flyers, yield 4 jobs sales totaling 12k

Now this one pisses me off
Son 3 selling order management CRM software daddy created, saves companies thousands and thousands, in productivity dollars, total sales after 7 demos

4k

Canadian business back wards, stupid, taken this show to the USA..

Business here in the stone ages… With neanderthal knuckles draging owners

#193 Steven on 08.04.13 at 7:27 pm

These realtors must think the people of Canada are lottery winners, government employees, doctors,lawyers and engineers or something.
Realtors and their clients need a reality check real bad.