Cold comfort

It may be no coincidence that Home Capital melted down on the stock market the same day Ontario was trying to hammer housing. Canada’s premier alt lender lost big – down as much as 20% in a single session – after regulators charged the company with fibbing to investors and breaking securities laws. You might recall Home Capital had to shed dozens of brokers who were falsifying mortgage docs, handing out billions to borrowers who didn’t qualify.

Well, the company may not survive. Ditto for a whole whack of small-time speculators who bought condos they plan to flip or rent. At first blush, it looks like the condo market was the big loser in Thursday’s political assault on the free market. Rent controls on new units will virtually guarantee consistent long-term negative cash-flow for investor-owned apartments. Ouch. And since half of recent condo sales have gone to investors, you can imagine the impact.

The condo trade also relies heavily on assignment clauses – allowing buyers to sell their interest in a unit prior to closing. Given the fact it can be three or four years between making a deposit on an unbuilt unit and actually seeing it registered, assignments make sense. There are whole brokerages dealing in nothing but. So now with intense scrutiny and the CRA involved, any gains are likely to end up being taxed as income. Double ouch.

In case you missed it, Ontario did about what was forecast here. A non-resident (foreign buyer) tax of 15% – or $240,000 on the average detached house. Rent controls on every unit, ensuring landlords cannot stay ahead of inflation. Letting cities tax under-used properties – about $1,400 a month on a 416 SFH. And nebulous new regulation for realtors, perhaps ending an agent’s ability to represent both buyer and seller.

So what happens as a result?

In Vancouver sales plunged after similar moves were made and the prices of high-end properties sank. But residential values are sticky, and the consensus seems to be that none of it worked. Average houses remain unaffordable for average families, even after the Chinese dudes took a hike. But the GTA is not YVR. All markets are local. And Van was already rolling over when the province locked out foreign buyers and taxed empty houses.

It’s reasonable to assume the condo market will erode, since rent controls make investing in concrete boxes a losing prop. Controls also discourage purpose-built rental housing, so what the province has just done may actually limit the amount of new units coming to market. As far as the foreign buyer tax goes, realtor stats show only 4.9% of GTA deals were done by non-residents. So logic tells us the impact will be half what it was in Van, where the city had a 9.9% non-resident penetration.

As stated here so often, real estate’s emotional. People get horny to have it (whatever the cost) when markets rise and run screaming from perceived risk when it falls. Rent controls, realtor handcuffs and a tax on foreign guys may not be enough to persuade house-lusty moisters that a slanty semi on a dodgy street isn’t the holy grail. Which is why we could use that tax on stupid.

If you ever need evidence it’s insatiable demand – fueled by the cheap money government has provided – and not greedy, tax-cheating, money-laundering, speculating foreigners, just look at this chart. Personal debt’s over $2 trillion. Two-thirds of it is mortgages. All those orange bars are going wild.

This still ends badly. They know that tonight at Home Capital.

218 comments ↓

#1 TurnerNation on 04.20.17 at 6:29 pm

Appears, TSX ready to break out here. Oil’s performance notwithstanding.

I found Bandit’s IG feed. (Maintained by some dude.) https://www.instagram.com/garthturner/

#2 Gasbag Boomer on 04.20.17 at 6:30 pm

Yup Garth, you nailed it!

#3 Alice on 04.20.17 at 6:31 pm

That’s what we know. Then there’s the whole shadow banking sector that blew up to a trillion dollars. And that’s just the number the Bank of Canada can track.

https://betterdwelling.com/canadas-1-1-trillion-shadow-banking-sector-now-half-large-banks/

#4 domain on 04.20.17 at 6:31 pm

Fire in the hole.

Let’s see what comes out now.

#5 ancodia on 04.20.17 at 6:33 pm

They need to fix the blind offer process

Just a few weeks ago I put a bid on a house that had been sitting on the market for a few weeks with no offers. It was way over priced and needed a lot of work. Not even an hour after I submit my offer the agent calls me and tells me another offer is incoming and asked if I wanted to change my offer. I didn’t (and my offer was below ask). Next day the agent tells me they accepted the other offer that was about 10% over asking. So the buyers did well, so did the agents and taxman but the buyer got screwed by over paying for something due to bidding blindly against me. I’m not sure how you would fix it but the current process is flawed.

When I asked my agent how an offer could come in against mine so quickly after weeks of nothing she said it was co-incidence. Not sure about that either.

#6 The real Kip on 04.20.17 at 6:34 pm

HEY KATHLEEN! CLose that barn door will ya, all the horses ran away!

#7 Matt on 04.20.17 at 6:35 pm

Good on her for taking these steps. If you’re hated already, you might as well take the opportunity to do the province some good.

#8 Zuco on 04.20.17 at 6:35 pm

Hi Garth,
Can you comment on s&p 500’s potential head and shoulder appearance on the 50D MA.
Thanks,
Zuco

#9 bdwy sktrn on 04.20.17 at 6:36 pm

vancouver has seen condos get even hotter since the CDT. (china dude tax)

when a tenant moves out the rent can be increased at will. do rent controls really mean anything?

east van sale prices still at nosebleed levels as supply is dry as ever.

#10 First on 04.20.17 at 6:37 pm

FIRST!!!!

#11 Jim Bob on 04.20.17 at 6:37 pm

If most condo units (or if not most then significant chunk) bought by investors are not currently rented out but they are empty so as ready to sell/flip – why do you conclude the rent controls will hamper condo market if it is indeed based on flipping/selling and not renting?

Not being sarcastic, genuinely want elaboration on ramifications for condo market here and not understanding that. Thanks.

#12 The real Kip on 04.20.17 at 6:38 pm

So, even if the 4.9% of foreign buyers take off, that will still leave a shortage of SFH in the GTA and the 33% annual increase last year will likely stay. I’m good with it.

#13 bdwy sktrn on 04.20.17 at 6:38 pm

well done turnernation on the hcg call.

why is the osc stuff potentially fatal?

#14 Randy on 04.20.17 at 6:39 pm

Debt Slaves. What a way to get an education in Finance

#15 TLG on 04.20.17 at 6:39 pm

Yield is hard to find in the stock markets and it is also taxable. Yield is parabolic in the housing market, easy to finance, and tax free. It’s a a no brainer Garth.

#16 I'm stupid on 04.20.17 at 6:39 pm

Quick question…

What happens to people with mortgages that didn’t pass the stress test, if Home Capital Group goes bankrupt?

#17 BobC on 04.20.17 at 6:43 pm

Can anyone think of an example where rent or price controls accomplished anything other then a shortage? Can anybody think of an example where the government reversed a law that gives them control and power? Remember these new taxes and laws are never going away.

#18 bdwy sktrn on 04.20.17 at 6:44 pm

how exciting!
finally a new listing on the block today.

it’s a dumper van special, only one lot off of vic drive(too loud),33’lot, no redeeming qualities.

max lot value here is 1.5 or 1.6

ask price 1.99

#19 Tony on 04.20.17 at 6:44 pm

Follow the 4 cornerstones and we’ll know what will happen to the rest of the GTA. Markham, Unionville, Richmond Hill and Stouffville.

#20 bdwy sktrn on 04.20.17 at 6:44 pm

https://www.realtor.ca/Residential/Single-Family/18049541/1927-KITCHENER-STREET-Vancouver-British-Columbia-V5L2W6

#21 Alberta Ed on 04.20.17 at 6:47 pm

When government says “We’re here to help”, it’s time to run.

#22 Madcat on 04.20.17 at 6:48 pm

TAX DEBT/CURE BUBBLE/ GENERATE HUGE REVENUE FOR GOV COFFERS!

Their ideas suck… Here’s one for them that will generate tonnes of revenue without hiking the overnight rate…
Tax cheap money!!! Add 3% to new mortgages that would be collected by banks and handed over to the gov’t. That would jack that 2.5% mortgage rate to 5.5% and cure this bubble whilst generating heaps of cash to pay for bridges/schools etc…
This simple new tax would allow the Government to hike the interest rate without actually hiking the rate! Win! Win! They could slowly add the tax to existing mortgages over the course time (In five years existing mortgages to pay 1%, 10 years 3%).
This would also encourage people to SAVE instead of DROWN THEMSELVES IN DEBT!!!

#23 John B on 04.20.17 at 6:50 pm

We know that real estate is a very large component in Candian GDP, and almost certainly above the average figure within the GTA. It is a safe assumption that the condo market is the far bigger economic driver of the GTA when compared to single family homes (annual new supply of the former is several times in size). Accordingly if we get a slowdown in the condo space, which I agree with the author as being a likelihood, it should have not only the psychological impact of lower prices for existing owners, but also an actual impact on employment in development and transaction related fields (not to mention all of the ancillary spending created from new condo building and high prices…furniture sales, tradespeople, personal trainers, $20 cocktail bars etc etc).

The derivative effects of the US slowdown was one of the more interesting components, and I think it’s one that often doesn’t get alot of play in the Canadian coverage of what the future may bring.

#24 Average Joe on 04.20.17 at 6:50 pm

Over the week, I’ve watched Zoocasa light up like a Christmas tree with new listings, while sales have ground almost to a halt. It looks like maybe the tax on stupid is a self-inflicted one.

#25 House_Horny on 04.20.17 at 6:52 pm

Wait! Im confused, so what does the rental controls do to the new rental purpose built units that charge insane amounts?

#26 I Still Love It! on 04.20.17 at 6:52 pm

I just wish they would have taxed more groups – domestic speculators, vacant homes and old guys with ice cream shops, but this will do!

#27 sugarlips on 04.20.17 at 6:53 pm

On the money Garth, well called.

For those who have stayed liquid and are willing and able to run to the hills from the mad markets, what do you think are the most reliable resources today to help determine areas where fair value might be emerging?

Eg is the ongoing ‘slow melt’ in Calgary finally making any of the postcodes viable for a long term family home or is it going to be a ‘catch a falling knife’ situation indefinitely?

Is there any of the West Coast that is worth investigating value-wise for the open-minded?

#28 enough is enough on 04.20.17 at 6:55 pm

I wonder how long the sheeple in canada will continue to put up with the policitians and elites that presume to know how to tell us to live our lives. Maybe it’s time to see that time honoured response of the badly governed throughout history and make them truly terrified of the people they hold in such contempt. Who wouldn’t love to see Wynne or Notley or Trudeau or the presidents of our many radical progressive “institutes of higher learning” running in terror being chased by a mob intent on exacting some “accountability”. just a thought

#29 Stone on 04.20.17 at 6:57 pm

Yay!

#30 GFD on 04.20.17 at 6:57 pm

It should be no surprise to anyone that liberals in Ontario and at the federal level in particular have these dictatorial, Marxist tendencies, this is what inevitably happens when you have rulers who truly believe only they have the correct answers and by god they are going do their best to make sure they can keep imposing their will upon us.

This government is so terrible, with such an awful track record, that they shouldn’t even run in the next election if they had the tiniest bit of humility. Unfortunately for the nation, the Prime Minister’s biggest advisors come directly from Ont. government administrations (among other things, advising in Power plant fiasco) that lead us down road. They know what’s best for us, whether we want it or not.

#31 Dave on 04.20.17 at 6:58 pm

Vancouver brought in similar regulations with many loop holes then loosened the rules. Net effect very little, I can see 3 brand new houses being started from my front yard. By the time things really change to some what affordable levels, my guess is that life will have passed you all by.
In conclusion I have no doubt NDP will win only because most have had it with the liberals.

#32 slam on 04.20.17 at 6:59 pm

Too late to short Home Capital stock?

Is this a good option to use to short Canadian real estate?

#33 bill on 04.20.17 at 7:00 pm

deja vu all over again…

#34 GFC v2.0 on 04.20.17 at 7:00 pm

“….It may be no coincidence that Home Capital melted down on the stock market the same day Ontario was trying to hammer housing…..after regulators charged the company with fibbing to investors and breaking securities laws….”

“…And nebulous new regulation for realtors, perhaps ending an agent’s ability to represent both buyer and seller…..”
_________________________

Every industry brings upon itself the nanny state it so richly deserves.

No corruption, no nanny state required.

#35 Sitting on the toilet thinking on 04.20.17 at 7:00 pm

I hope these measures pop the bubble but I doubt it will. Until the boc makes money more expensive it won’t do much to curb the insanity.

#36 The Wet Coast on 04.20.17 at 7:03 pm

Garth your comment “realtor stats show only 4.9% of GTA deals were done by non-residents” how did the realtors know they were non-residents? Were they wearing a badge? I love data, good data. The only person that seems to have access to it is Ross Kay, and I have no idea where he gets it from. Until we have real data everything said here and elsewhere is just speculation. If BC and Ontario want to change the game they should make all data public. Until that happy day my contention is that foreign buyers constitute 14.00231% of the Vancouver market, and until we get the data I am as likely to be right as you are. But the RE fears that more than anything.

#37 Smoking Man on 04.20.17 at 7:03 pm

And to add fuel to the fire bond yields are trending lower and lower. This ain’t over people. Peek 400k on to of the average SFH price before the fat lady gets to drop the mic.

http://www.bankofcanada.ca/rates/interest-rates/canadian-bonds/

#38 conan on 04.20.17 at 7:04 pm

“Rent controls on new units will virtually guarantee consistent long-term negative cash-flow for investor-owned apartments.”

Call me clueless, but I don’t get this dynamic.

If I build new rental units I can charge whatever the market will bear. If people want to live their entire lives in my units, then it is no problem dealing with rent controls.

I make my money on the new lease, and then I make money again by the tenant not moving out.

#39 traderJim on 04.20.17 at 7:05 pm

I don’t know what the problem is, but I’m pretty sure the answer is: More taxes!

As long as someone else is paying them of course. Don’t tax me. Just all the people who were smarter than me.

#40 Alero01 on 04.20.17 at 7:05 pm

Best pet photo ever! :)

#41 cow man on 04.20.17 at 7:07 pm

Easy solution:

All Ms. Wynne had to do was bring in a fixed ratio on the residential mill rate to the non residential mill rate as Ms. Notley did in Alberta. If Toronto and GTA mill rates were 1 instead of the low ratios they are now, the housing market would cool immediately. Just compare residential taxes paid in the GTA to the rest of Ontario. The industrial, commercial, business class assessment base highly subsidizes residential property taxes in urban areas.

#42 Fox Trot on 04.20.17 at 7:07 pm

De Omnibus Dubitandum

#43 paulo on 04.20.17 at 7:10 pm

Home Capitol = Canada’s version of Country Wide in the US whose demise was the first domino in the 2008 US RealEstate Crash .
Add to that the fact that the trumpster seems to have beaver stew al la NAFTA on his short term agenda, the peace and calm on the trade front will be gone shortly
We still have to see if there additional moves by big goverment next Thursday i am guessing there will be a late egg or two there.
seems that all the ingredients for a perfect storm are in the pressure cooker. still considering that million plus dump in the GTA ? go ahead make a sellers day and take a reservation for the next dish: Greatest fool road kill stew

#44 Freedom First on 04.20.17 at 7:10 pm

Mortgage brokers falsifying docs. Personal debt’s over $2 trillion. 2/3 mortgages. And on and on. Canada & Canadians following the Americans idiocy prior to the GFC. Only worse. Fear and greed. Both are deadly. And together, more deadly.

I can’t even imagine not doing what is best for me and living every day in a state of worry free calm, peace, and serenity. But then again, I’ve had a lifetime of practice.

I learned young that there is nothing wrong with peer pressure. The trick is in having the right peers. Priceless.

#45 Steerage Bilge on 04.20.17 at 7:11 pm

#37 Smoking Man on 04.20.17 at 7:03 pm

And to add fuel to the fire bond yields are trending lower and lower. This ain’t over people. Peek 400k on to of the average SFH price before the fat lady gets to drop the mic.

http://www.bankofcanada.ca/rates/interest-rates/canadian-bonds/
..

Batman!!… hope you bet a lot on that……

#46 David McDonald on 04.20.17 at 7:13 pm

As Garth has said many times all levels of government have pushed policies to drive up housing prices. The CMHC and low interest rates are of course the main culprits. Condo owners have been raising rents in an attempt to break even. This is indeed an unfair consequence for renters caught in the middle. However the solution is not to break the market system for rental properties; the solution is to undo the government measures that caused the problem.

Ontario under this Liberal government is drifting dangerously towards being an expensive bureaucratic province. We should all be worried.

#47 I'm Not Poloz on 04.20.17 at 7:14 pm

Bank of Canada Governor Poloz wants that $0.25-0.30 US Loonie so badly that he will even cut interest rates on May 24, 2017!

#48 Smartalox on 04.20.17 at 7:17 pm

@TLG #15:

Hah, I see what you did there:

“In real estate, yields are parabolic…”

In math, a parabolic function is one where values increase to some peak, then decline just as quickly. The very definition of ‘what goes up, must come down’

Parabolic functions are used, for example, to plot the trajectories of intercontinental ballistic missles.

#49 dr. talc on 04.20.17 at 7:22 pm

In case you missed it, Ontario did about what was forecast here. A non-resident (foreign buyer) tax of 15% – or $240,000 on the average detached house

—-
A rule of the rulers is ‘blame the other guy for what you are doing yourself’ works every time

$195,000, that’s the HST is on an an (average) 1.5 million dollar new house. The builder (seller) pays it because the buyer does’t have it, although it’s a buyer tax. in other words its noncollectable from a buyer, so it gets amortized and blended into the mortgage. It’s not like 13% on a candy bar, no no

‘foreigners are the problem’ is just red meat to dummy voters by desperate politicians.
The voters are dummies because the politicians are the problem.

Watch out for those yelling ‘pick pocket’

To Kathleen Wynn supporters-

Ask yourself- what is a ‘front man’ ?
Ask yourself ‘even if there is a problem with foreigners
is it the man or the foreign money?’
Did the sister address money? of course not, she wants the money, Tory just got back from India looking for more of it , ha ha

#50 Bank of Millenial on 04.20.17 at 7:22 pm

#23 John B

Bingo John.. It’s never the bite that kills you, its the poison that seeps in slowly.

2nd order effects will be larger.

#51 Drew on 04.20.17 at 7:24 pm

A friend of mine lives in Toronto but owns a condo in Vancouver. Both him and his wife are from Vancouver and they go back to visit family and they plan to retire back there. They bought the condo years ago as they saw prices going up and wanted to buy before prices got to far out of reach. Anyway, with the stupid new vacancy rules they have to sell or rent out their place. Now they are neither foreign buyers or flippers, they are just normal people planning for their future and the like usual the government has decided to screw them over.

#52 Paul on 04.20.17 at 7:24 pm

So an agent list’s a house the seller wants marketing, advertising, open houses, sign. Ect

But don’t bring him an offer ? Wtf?

#53 dr. talc on 04.20.17 at 7:28 pm

#17 BobC on 04.20.17 at 6:43 pm
Can anyone think of an example where rent or price controls accomplished anything other then a shortage? Can anybody think of an example where the government reversed a law that gives them control and power? Remember these new taxes and laws are never going away.

===

wanna see a blank face?
as a millennial ‘what is key money’?

they will know very soon

#54 toronto1 on 04.20.17 at 7:30 pm

stick a fork in it!

its lights out like Garth already said

Condo market is toast- rents are tied to income and not credit, interest rates or speculation. Without the large gains in assignments or property value- owning a condo as a rental makes no sense anymore.

SFH will also drop accordingly as those who own condos usually harvest their gains and step up the property ladder, without those gains, there is no stepping up the property ladder- SFH home gains will be hurt.

Without the crazy speculation and gains, its over.

Home Capital is the first of tier 2 capital firms to blow up, many more will follow, watch tier 1 and 2 lenders available credit shrivel up like a prune in the hot sun shortly. at the end of the day, houses, condos etc.. are only worth the credit a lender is willing to extend as very few people buy cash. Thats the back end you dont hear about in these press conferences.

Ontario will start to enforce and investigate tier 2 firms, banks will start reigning in their assessment values on properties- those that buy now would be wise to include a finance clause in all offers. its coming

house prices in outside core areas (newmarket, barrie, KW, Durham) will see a massive blow off as they were most impacted by GTA sellers cashing out and bidding silly values. As well, locales outside the GTA are also most sensitive to any increases in rent due to lower incomes- double whammy

#55 choptstix on 04.20.17 at 7:35 pm

RE: “In Vancouver sales plunged after similar moves were made and the prices of high-end properties sunk. But residential values are sticky, and the consensus seems to be that none of it worked. Average houses remain unaffordable for average families, even after the Chinese dudes took a hike. But the GTA is not YVR. All markets are local. And Van was already rolling over when the province locked out foreign buyers and taxed empty houses.”

thing is, Garth: condo sales seem to be on the uptick again…and it makes perfect sense: people can’t afford to buy detached, even a townhouse…many people wanting to take their money and run/downsize to smaller units/many people can’t buy at all so have to rent (hence condo rentals)…so it is little wonder that the greasy New Coast Realty head (who got nailed by Kathy Tomlinson’s good reporting last yr) said it is condos ‘where the real gold lies’.

crazy …Telus gardens condo in Scamcouver (seymour/georgia) 1 bdrm 469 sq feet asking price of $740k…i.n.s.a.n.e.

#56 Blobby on 04.20.17 at 7:36 pm

This is a typical harperite/Christy Clark move

The plan is not to fix the problem, but be seen to be doing it in a way which appeases voters. Telling voters they’re dumb won’t work, appealing to their bigotry will.

If you can hold off any crash long enough so the next government takes the blame – job done

#57 Jerry on 04.20.17 at 7:38 pm

THat chart shows what has happened to Canadian households as a result of foreign buyers pushing up the price of real estate–they have obviously had to take on more debt because foreign speculation and money laundering have drive the market to ridiculous levels.

#58 For those about to flop... on 04.20.17 at 7:39 pm

Hey Broadway,since you’re on here I might as well put you to work.

What happened at 955 Forest Hills Drive, North Vancouver?

Did they pull a cookie out of the jar or just a glass sliver…

M42BC

#59 crdt on 04.20.17 at 7:40 pm

I think the tax will do what it ought to, that is completely fack peoples’ golden gooses right up the wazoo. The tax here in Vancouver had a significant effect, and while the realtors are busy lying their little arses off to keep the party going a bit longer, chairs are quietly being removed from the realtor musical chairs “you are richer then you think” game. We all can’t be millionaires, or gorgeous… Sales are WAY down, prices not so much, but there is less at the realtor smorgasbord these days..

#60 Shortymac on 04.20.17 at 7:47 pm

FIRST

I wonder how these measures will screw over a lot of people who bought condos as a “starter home”.

Sad they won’t raise rates despite oh so desperately needing too. How will that affect the SFD prices

#61 Foreign Capital vs Rates on 04.20.17 at 7:55 pm

Good for the provincial government to close the loophole on pre-sale condo assignments under the foreign buyer’s tax.

When you dig on BC’s foreign buyer’s tax, guess which transactions are exempt from the tax – yes, condo pre-sales. That’s right, Bob Rennie, the ‘Condo King’ and the BC Liberals chief fundraiser (until a few months ago) had his core business exempted from the tax.

Do you wonder why condo’s are all of a sudden on fire when supposedly they are the worse investment due to the absence of owning any land?

Condo pre-sales allow assignments which allows speculative flipping without any paper trails (no title registry) – which allows massive capital gains and cleansing of money.

Its the current form of shadow flipping that plagued the single family house market in Vancouver as the house was bought and sold several times for every increasing amounts (now who would buy and sell a place 4 or 5 times in a day…hmmm)

Take note of when the condo market went on fire – it was shortly after the foreign buyer’s tax was implemented (the condo market was then pumped up by Christy’s $700 million down payment program of which 1000 people have used province wide).

Still think that foreign capital has no or a negligible impact? Guess again…

And do you know why prices are stabilizing and going back up in Vancouver? Because foreign capital was dazed for a moment and then adjusted and saw the tax as simply the cost of doing business.

#62 Smartalox on 04.20.17 at 7:55 pm

Oooohhhh ‘Realtor Handcuffs’.

Ten months ago the BC government took over regulation of the province’s Real Estate industry. Net result? Zero. Zero fines, zero convictions, zero changes to the wild, wild west of weal estate.

Ontario went the other way: RECO hired a failed politico as their leader.

Also absent in BC’s real estate reforms: no meaningful rent controls – but that’s easy to understand given the amount of real-estate money fuelling the provincial Liberal party.

Politicians at every level are blindly firing bullets at this gas bag, hoping one will be some sort of ‘magic bullet’ that lets the balloon deflate slowly without popping it. The problem is that balloons and bullets just don’t work that way.

I’ll be interested to see just what the fatal bullet turns out to be. My bet is on the election of an NDP government as there is anecdotal evidence that this has worked in the past. As much as I would give anything to NOT have that happen in BC, it may be the only thing that works!

#63 housing crash!!! on 04.20.17 at 7:56 pm

So when are all of you people who’ve been waiting for the crash going to jump in and buy? next week?

#64 Rook on 04.20.17 at 7:58 pm

Garth,
That chart you posted just shows mortgages. A ton of the ‘tax-cheating, money-laundering, speculating foreigners’ use mortgages as well, so the chart doesn’t prove a thing. Also, tax-cheating and money-laundering is illegal and horrible for our country. I don’t understand why you don’t think this should be one of the countries top priorities, regardless of how much of it is fuelling the housing markets. Our laws are lax and the ones we have are not enforced.

Myths. — Garth

#65 Murphy on 04.20.17 at 8:01 pm

Marc Cohodes has been shorting Home Capital since 2014.
Just maybe he is also correct on the housing bubble in Canada.

#66 choptstix on 04.20.17 at 8:02 pm

Garth: this is the story I was referring to (new coast realty’s head calling condos the ‘real gold’)
http://www.theglobeandmail.com/news/investigations/inside-a-fast-growing-bc-firm-that-has-home-sellers-crying-foul/article29578417/

#67 east van on 04.20.17 at 8:03 pm

Glad to see Ontario is finally doing something. All so called “free markets” are doomed to boom, bust, and collapse without government regulation .

#68 jay on 04.20.17 at 8:07 pm

Investors ,come to B.C ,you can do whatever you want if you get the renter to sign a fixed term rental agreement . This https://www.biv.com/article/2016/6/tight-rental-market-bc-landlords-dodge-rent-laws-f/

#69 Lulu on 04.20.17 at 8:13 pm

*Giggles* more *Giggles* RENTERS!!!! Are you ready!? HaHaHaHa!!!! Your day is finally coming!!!

Woot Woot!!!

#70 Ken in BC on 04.20.17 at 8:21 pm

If HGC was submitting fraudulent employment-income documentation, is CMHC still on the hook for insuring a failed mortgage based on those falsified mortgage documents? If you submit false statements on an insurance application, you are basically uninsured.

#71 Xbox Economist (formerly Londoner) on 04.20.17 at 8:23 pm

For years other countries (US, UK and especially China) have undertook massive quantitative easing and fiscal stimulus policies to boost economic growth. Individual investors and corporations were then able to export that inflation to counties such as Canada, which did not employ the same policies. The foreign resident tax may, perhaps, help even the playing field for local residents, irrespective of how little market share they (foreign investors) make up. Although, arguably, it should be much higher.

Rent control and the lights out tax were OTT given the other measures, and the government could have employed fiscal policy tools to temper speculation.

#72 Trumpocalypse2017 on 04.20.17 at 8:25 pm

CHINA BOMBERS ON HIGH ALERT!!!!!!

http://abcnews.go.com/International/china-places-bomber-aircraft-heightened-alert/story?id=46916570

Stay calm.

Prepare.

#73 Doug in London on 04.20.17 at 8:30 pm

@TLG, poast #15:
Yield was ridiculously easy to find in 2013 when REITs and electrical utility stocks were ON SALE. Similarly yield was ridiculously easy to find 2 years ago when preferred share ETFs were ON SALE. That’s a more of a no brainer than buying a RIDICULOUSLY overpriced house.

@Drew, post #51:
They should have cashed in their winning lottery ticket in Vancouver before they moved.

#74 Xbox Economist on 04.20.17 at 8:31 pm

“It may be no coincidence that Home Capital melted down on the stock market the same day Ontario was trying to hammer housing.”

HCG has been the target of short sellers for a long time now. Similarly the OSC investigation into their regulatory controls was ongoing for years. Likely, insiders were leaking information. Despite that, there’s no news of a spike in mortgage defaults or arrears on their loan books. And, as yet, no mention of it’s role in the shadow mortgage market.

#75 Rook on 04.20.17 at 8:32 pm

Myths. — Garth

You’ve never expounded, or proven why you think this is a myth. You can’t just denounce something you don’t understand. If you want I can point you in the direction of an anti-money laundering lawyer to help you with some information on this.

#76 Robert on 04.20.17 at 8:37 pm

The impact of non-resident speccers on our residential and commercial property is significant in that it inflates both prices and perception. As long as government permits foreign nationals to treat our home and native land as a money laundering sink the bubble continues. The golden goose will just keep laying while Justin Nero fiddles with social policy to amuse the masses.

#77 AB Boxster on 04.20.17 at 8:42 pm

http://business.financialpost.com/news/fp-street/rbc-exploring-sale-of-bonds-backed-by-uninsured-residential-mortgages

So lets see..

A major mortgage lender is is big trouble for their lending practices. (Home Capital)

And RBC is looking to package substandard loans from a number of lenders into bonds backed by these alt-a mortgages, including the loans of said fraud artists Home Capital.

What’s next?
Maybe Moodys rating these pieces of junk as triple A+ investments and flogging them to the unsophisticated as secure fixed income?

Is this not exactly the kind of shit that was going on in the USA prior to the massive meltdown of companies, stock markets, and housing markets that resulted in 10 years of world recession?

#78 Wannabe Plunger on 04.20.17 at 8:44 pm

No surprise at all considering the caliber of employees working at HCG, speaking from personal experience.

#79 Linda on 04.20.17 at 8:47 pm

So foreign buyers are ‘not residents’ – ok. But – if I live in Canada but not in Ontario & own a property, am I considered a ‘foreign buyer’? Can one be a Canadian citizen living in Canada & be considered a ‘foreign buyer’ if one does not reside in Ontario? Just wondering…..

#80 crowdedelevatorfartz on 04.20.17 at 8:48 pm

@#77 AB Boxster
“Is this not exactly the kind of shit that was going on in the USA prior to the massive meltdown of companies, stock markets, and housing markets that resulted in 10 years of world recession?”
******************************************

Yep.
Only our economy is no where near as big. So no earth quaking effects……
The rest of the world is sitting back and shaking their heads that we learned NOTHING from what happened to our next door neighbors.

Greaterfool Nation

#81 KK Royale on 04.20.17 at 8:49 pm

What’s the big fuss over rent control? The limit on rent increases only applies to existing tenancies. In between tenancies ie when the landlord is looking for a new tenant they can ask for whatever rent they want and will get whatever the market will bear.

#82 Canada is a house of Debt on 04.20.17 at 8:51 pm

I’m stupid on 04.20.17 at 6:39 pm
Quick question…

What happens to people with mortgages that didn’t pass the stress test, if Home Capital Group goes bankrupt?

Thats a very good question. Wouldnt the Canadian house of cards come crumbing down?

#83 dakkie on 04.20.17 at 8:53 pm

Toronto House Price Bubble Hit with 15% Foreign Buyers Tax. “Property Scalpers” & “Double Ending” Brokers Targeted
http://investmentwatchblog.com/toronto-house-price-bubble-hit-with-15-foreign-buyers-tax-property-scalpers-double-ending-brokers-targeted/

#84 Al on 04.20.17 at 8:54 pm

The Vancouver NR Tax took effect on closings after the a specific date and Ontario’s NR Tax takes effect on firm deals dated after April 20, 2017. What’s there to stop parties from pre-dating their purchases in Ontario?

#85 bubu on 04.20.17 at 8:54 pm

No down payment?

No problem: https://collinbruce.ca/what-we-do/#borrowed-down-payment

What system is in place for CHMC to make sure the rules are followed? ZERO, NONE…..

#86 Bright side on 04.20.17 at 9:05 pm

At least ISIS is not hunting for police with machine gun at daylight on Bloor street.

#87 Wynne then Lose on 04.20.17 at 9:06 pm

The Gov’t changes are a joke. With have ZERO impact on longer term price trend. As soon as a condo is vacant the owner can raise the price to whatever the market can carry.

As for the foreign buyer tax. Total joke. That is nothing but an HST sales tax. Foreigners simply view it as a cost of business.

Sorry folks, if you don’t own a home already, maybe better luck next life.

#88 45north on 04.20.17 at 9:07 pm

At first blush, it looks like the condo market was the big loser in Thursday’s political assault on the free market. Rent controls on new units will virtually guarantee consistent long-term negative cash-flow for investor-owned apartments.

Kathleen Wynne and Charles Souza have made a mistake. A political mistake. The people who bought Toronto condos are the Toronto middle class. Wynne and Souza have just thrown them under the bus.

Wynne and Souza should have put the blame where it belongs with Justin Trudeau, the Federal Liberals and Stephen Poloz. They control Canada Mortgage and Housing Corporation, they regulate the banking industry and they set interest rates.

Here’s the editorial in the Ottawa Citizen:
Editorial: Really, does anyone trust the government to fix housing prices?

http://ottawacitizen.com/opinion/editorials/editorial-really-does-anyone-trust-the-government-to-fix-housing-prices

#89 crowdedelevatorfartz on 04.20.17 at 9:08 pm

@#42 Foxtrot
“De Omnibus Dubitandum”
*******************************************

I’ll see your “All is to be doubted”

and raise you…..

“Frequenti attollo fetere”

#90 Tony on 04.20.17 at 9:13 pm

Re: #11 Jim Bob on 04.20.17 at 6:37 pm

95 percent of the owners who rent them out are in a negative cash flow situation with thirty percent of the purchase price down. This will put a lot of selling pressure on condos because of the rent controls on everything from after 1991. The same is true of townhouses but there’s a lot more condos than townhouses.

#91 paulo on 04.20.17 at 9:14 pm

#70 Ken in BC

Thats a very interesting question, also there are the reverse mortgages,these guys market the chip reverse mortgage product. as far as i know they are the only major player doing so.
obviously if the OSC makes it case these guys are done
bus loads of lawyers and lawsuits from investors,likely follow on criminal investigations and charges
the superintendent of financial institutions and the cdic
would assume control, likely parcel out the mortgage portfolio to the big 5 the big hit would come as the individual mortgages come up for renewal, as many will not qualifie you can bet the chmc will look over any claim and likely reject it
the biggest issue would be what to do with the reverse mortgages commitments

#92 Pete from St. Cesaire on 04.20.17 at 9:17 pm

Glad to see Ontario is finally doing something. All so called “free markets” are doomed to boom, bust, and collapse without government regulation .
—————————————————–
So I suppose you prefer a “command economy” also known as communism. Price controls can’t work, not unless you hold the sword of Damocles over the heads of the population.

#93 akashic records on 04.20.17 at 9:18 pm

Rent controls on new units will virtually guarantee consistent long-term negative cash-flow for investor-owned apartments. Ouch. And since half of recent condo sales have gone to investors, you can imagine the impact.

Is it really good for the Canadian economy?

The obvious solution would be to drop the tax on rental income to be the same as tax on capital gains on stocks, etc. or dividend income.

It would not disrupt violently the economy and it would stimulate the rental market.

Who benefits from “virtually guarantee consistent long-term negative cash-flow for investor-owned apartments”?

#94 Pete from St. Cesaire on 04.20.17 at 9:19 pm

What’s the big fuss over rent control? The limit on rent increases only applies to existing tenancies. In between tenancies ie when the landlord is looking for a new tenant they can ask for whatever rent they want and will get whatever the market will bear.
————————————————————
Simple, rent control won’t keep pace with inflation; neither price inflation nor interest rate inflation.

#95 Ret on 04.20.17 at 9:20 pm

If Home Capital gave some people mortgages in 2014 that they should not have gotten, what are those properties worth today? A lot more than in 2014, I would suspect. Please sent me the repo list if it comes to that.

Idle speculation on my part, but one of the big banks would probably jump at the chance to take on the majority of HC’s mortgages.

HC used some independent brokers who proved to be less than trustworthy. The big banks used mostly their own in house people which is also no guarantee of honest appraisals and/or mortgage applications in my opinion.

When the tide goes out, there will be more than one naked swimmer out there.

#96 akashic records on 04.20.17 at 9:22 pm

#88 45north on 04.20.17 at 9:07 pm

Kathleen Wynne and Charles Souza have made a mistake. A political mistake. The people who bought Toronto condos are the Toronto middle class. Wynne and Souza have just thrown them under the bus.

That’s actually a positive side-effect.
The middle class will wipe out the Liberals.

Can’t come soon enough.

#97 45north on 04.20.17 at 9:24 pm

AB Boxster: RBC is looking to package substandard loans from a number of lenders into bonds backed by these alt-a mortgages

don’t get too excited. From your link:

Along with the banks, we’re trying to understand what the investor appetite could be in terms of both volume and price,” Wilson said by phone from Toronto. “Once we get a sense of that, we can make decisions about size, and even if the opportunity makes sense at all.

“we can make decisions and even if the opportunity makes sense at all”

said Wilson who doesn’t work for the Royal Bank.

#98 For those about to flop... on 04.20.17 at 9:26 pm

Hey Broadway, after you finish your Beef Wellington and Meringue pie can you also tell me what happened at 5325 Ivar Place, Burnaby.

Also I see your neighbors at 1847 Venables are in trouble.

Load up on sugar…

M42BC

#99 NoName on 04.20.17 at 9:28 pm

#89 crowdedelevatorfartz on 04.20.17 at 9:08 pm

@#42 Foxtrot
“De Omnibus Dubitandum”
*******************************************

I’ll see your “All is to be doubted”

and raise you…..

“Frequenti attollo fetere”
—-

A+

#InACrowdedElevatorStink

#100 IHCTD9 on 04.20.17 at 9:33 pm

#55 choptstix on 04.20.17 at 7:35 pm

crazy …Telus gardens condo in Scamcouver (seymour/georgia) 1 bdrm 469 sq feet asking price of $740k…i.n.s.a.n.e.
——

About 16 years ago, I tore down the original summer kitchen on my old farm house, and rebuilt it from the ground up. I hired a backhoe to dig the hole, and did everything else myself save for the electrical. It measures out right at 400 sf and serves as a laundry room, storage, and a place to park the weight bench.

Best as I can recall, the total cost at the end of it was $8500.00.

Humans evidently have an enormous potential to absorb pain and suffering…

#101 Tudval on 04.20.17 at 9:41 pm

“In Vancouver sales plunged after similar moves were made” Ummm, no. Not similar at all. In Vancouver they made a mess – the foreign buyer tax applied to all non-residents – no exemptions, it was retroactive and caused sheer chaos which sent buyers into the adjacent suburbs, where the tax did not apply. See the difference?

That being said, it will cause some confusion in Ontario also, until buyers figure out that that very few will actually be impacted and after a short staring contest, activity will resume as before.. perhaps even spurred by some pent-up demand.

In the condo market – slightly different story and more unpredictable – there seems to be some small print (exemptions to the foreign investor tax) that will perhaps make a difference.

#102 Vancouver on 04.20.17 at 9:42 pm

# 16 What happens if Home Capital goes under? Government will bail them out to save the bubble

#103 Trojan House on 04.20.17 at 9:48 pm

Human nature – you can’t do anything about it. For example, tell a kid to not put something in their mouth and what do they do? Put it in their mouth.

Tell someone not to text and drive? What do they do? Text and drive. The law says you can’t commit murder. What do some people do? Commit murder.

Politicians are human and subject to human nature. What do they do? Make a law to say “you can’t text and drive.” What do people do? They still text and drive. And the kid will still put a ball in his mouth. And the murderer will still murder.

My point is that you will never be able to change human nature with laws or taxes. However, politicians, human as they are, think they can.

#104 Tudval on 04.20.17 at 9:53 pm

#95 Ret Home Capital gave mortgages to people who SHOULD have gotten one from a major bank, but couldn’t because of stupid regulation. Not everybody has a 9 to 5 job and steady pay. Which does not mean they are not legit. Did some broker fudge some number to get around STUPID rules? I APPLAUD them for it and so should everybody.

I know a a guy who bought a house for his family – working as freelancer – 25 years ago. Would not qualify for a mortgage from a big bank today, but he never missed a payment. The incredibly low default rate shows that regulation is STUPIDLY TIGHT.

#105 Smoking Man on 04.20.17 at 10:07 pm

Millenials, your grand teacher just tossed your whole generation under a bus, Wynee s den of weirdness, her SFH will keep going up in value. Your dream world at liberty village not so much. Im afraid to visualize the day you can’t oil the chain on your China made bicycles .

Don’t worry the bastards are after me huge. There was a reason Garths sql dB at world press got hacked and made every Smoking Man post vanish.

Then to be restored with one mistake not there.

There is a reason my next book is being typed on an old typewriter.

Let’s see, we have a gambler that calls the markets and political outcomes perfectly. Hates the thought of paying tax on his bets to usless blood suckers with no skin in the game.

Can you bastards not see I’m the biggest bull shitter in the world. And the brightest.

I’m just a little old fiction writer with a shit truck who’s next book will rock.

Cap markets. You ready..don’t worry I love you assholes. It gives me an enourmas thrill watching you on your hands and knees mouth wide open swallowing an agenda that will screw your kids.

DM is going to get broomed. No vision of the future, the board will say.

I might even be on the board… anything is posable in fiction.

Bet Accordingly.

#106 S.Bby on 04.20.17 at 10:13 pm

#95
Ivar place sold two weeks ago after a price drop to 1.595 million. They tried selling late last year asking 1.615 but it didn’t sell. They paid 1.5 about a year ago and it has been rented out since then. I don’t know what it finally sold for.

#107 Kick out the jams on 04.20.17 at 10:28 pm

Smoking Man, I have pieced together through a few of your posts that I knew your nephew Mark and it was indeed tragic what happened. A solid guy who was – as far as I can tell – loved by all. Played intramural hockey with him and softball against him, he captained both teams… You never know what’s coming next in life so enjoy the ride while it lasts…

On a less serious note, some house hornyness straight from the horse’s mouth:
Have a coworker who is getting married this summer and just has to have a house to live in (of course) because her condo is not good enough anymore. Going to open houses out the ying yang and ready to make offers because “if we don’t buy now we will never own in Toronto”. They ain’t making that much either. just save my breath on the issue…

#108 Ron on 04.20.17 at 10:29 pm

#36 The Wet Coast on 04.20.17 at 7:03 pm
Garth your comment “realtor stats show only 4.9% of GTA deals were done by non-residents” how did the realtors know they were non-residents? Were they wearing a badge? I love data, good data. The only person that seems to have access to it is Ross Kay, and I have no idea where he gets it from. Until we have real data everything said here and elsewhere is just speculation. If BC and Ontario want to change the game they should make all data public. Until that happy day my contention is that foreign buyers constitute 14.00231% of the Vancouver market, and until we get the data I am as likely to be right as you are. But the RE fears that more than anything.

———————————————————
My neighbor in a fancy downtown TO condo building was a young Russian woman. No discernible job or skill set. Told me she bought the 2 bedroom several years before arriving in Canada. Within 1 year of landing in this country, I see on Facebook pictures of her naturalization ceremony.

Take it for the single data point that it is, but to your point, we just don’t know how common this kind of thing is.

#109 Pete on 04.20.17 at 10:31 pm

No spinning out of this one. RE is toast. When the condo domino falls it will knock over SFH and those who wish to delude themselves can if the wish. Home Capital is yet another domino that will speed up the housing pozni crash. Speculator can no long flip pre built condos or houses and now people will visually see EMPTY pre-sales for both houses and condos. People who “own” SFH are MAXED OUT and living in a glass house which is about to be hit with rocks.

#110 Pete on 04.20.17 at 10:38 pm

#104 Tudval

You mortgage brokers shills are so full of garbage. Why don’t you conduct business in the open and free market with no CMHC aka taxpayers to back up your fraudulent loans. You know what an American banker calls Canadian fraudulent mortgages? “Brampton” loans since the amount of fraud that is happening there is off the chart. Mortgage fraud is off the chart. Shut down CMHC and you blog dogs need to e-mail those useless idiot and let them know that we the people know what’s going on and sooner or later it will come out and now that you told them they can never say they had no idea. Use the countless mortgage fraud articles to back it up. Mortgage brokers HATE the free and open markets and rely on corporate conservative socialism CMHC or the taxpayer to take all the risk. BTW mortgage shill Defaults were fine in the US until one day they were not.

#111 crowdedelevatorfartz on 04.20.17 at 10:46 pm

@#99 No Name

I do believe we have raised the educational standard bar to greater heights with those plithy latin verses.

What say thee Garth?

Rhodes Scholarships all around?

Or a free DuplexDuplex at Tims?

#112 PM on 04.20.17 at 10:47 pm

affordability will likely never return to GTA. Anyone who does not own a property to hedge against the increase are screwed.

I am not a home owner and I spent 8 years in school to become a professional. I should have spent 6 months and got my RE license, at least this would have helped with 7.5 years of opportunity cost.

#113 Ron on 04.20.17 at 10:47 pm

I was visiting a friend in Phoenix in 2009, and as we drove out of the city, we could see entire developments, one after another, brand new, dark and empty.

Is that what Ontario will look like?

#114 X on 04.20.17 at 11:00 pm

So…..rates begin to rise in Canada mid 2018?…2 more quarter point increases expected in the US this year…assuming things continue to grind along in the US economy…and there is no war with anyone….

Too bad our economy didn’t suck so much….for many reasons…but to be able to increase mortgage rates and end this stupidity with real estate.

#115 Entrepreneur on 04.20.17 at 11:14 pm

Quickly read. Let us just say the leaders better to something quickly or maybe you are not qualified to be called a leader.

Too many depressed youth now ready for suicide. It would be nice to have leaders that speak the truth and not think of themselves or the party. Time is up and our youth that worked hard are now so alone.

And this is from personnel experience and from my heart. You leaders can pretend so long but our youth are precious and have ruined their lives.

And for the first time in my life (and because of the three amigo emergency meeting and ignoring the west coast similar housing problems) I believe that it is time for my country to separate from Ottawa. You have ignored us.

You have ignored us and now I want to separate. Our youth are being ignored by the leaders and time for you to step aside.

#116 Former Fool on 04.20.17 at 11:27 pm

Anybody have any news on real estate in Calgary? My own observations:

-In my old neighborhood, the price I sold for in 2014 now buys a house with an additional bedroom, an extra bathroom, and a couple hundred extra square feet.

-A few houses I’ve looked at on realtor.ca get de-listed (or sold for all I know) and end up on rentfaster.ca.

I ask as I’m surprised Calgary home prices haven’t come down further. A few of my coworkers are convinced Calgary’s house prices will keep climbing after a pause, based on sales in their neighborhoods. Would appreciate some insights on this topic. A Garth post on this would be great as well, we haven’t had a post on Calgary R/E in a while.

#117 What to do,what to do on 04.20.17 at 11:44 pm

Are my GICs from Home Capitol safe? I am a bit confused.q

#118 Not a greater fool on 04.20.17 at 11:51 pm

The changes announced today have targetted the condo market and made life better for renters. I don’t see material impacts to semis or detached homes. What was needed was a tax on those who buy and then sell in the near term. FB tax won’t do it. I guess we shall wait for prices to drive upwards for new measures.

#119 Lee on 04.20.17 at 11:51 pm

It seems none of the major papers believe Wynne did anything good today.

#120 DON on 04.20.17 at 11:53 pm

#63 housing crash!!! on 04.20.17 at 7:56 pm

So when are all of you people who’ve been waiting for the crash going to jump in and buy? next week?
*********************

I am rushing to the bank in the morning to get a BIG mortgage to bail out a greater fool. Dam the news, experts, examples from other countries. We here in Canada are so special tears the thought of which brings tears to my eyes. Why would our housing bubble fail, my realtor told me prices are expected to boom for the next twenty years. My plan is to sell in 6 -10 years for a cool 10 Mil profit and party like it was 1989…

#121 DON on 04.20.17 at 11:57 pm

#113 Ron on 04.20.17 at 10:47 pm

I was visiting a friend in Phoenix in 2009, and as we drove out of the city, we could see entire developments, one after another, brand new, dark and empty.

Is that what Ontario will look like?
**********************

Ah… Destiny! Even HOT housing markets meet their fate.

#122 DON on 04.21.17 at 12:03 am

http://www.scmp.com/business/global-economy/article/2086298/note-fed-just-pulled-plug-35-year-trend

“You have been warned. The US Federal Reserve is making it clear as punch that the days of easy money are over and tougher monetary medicine is on the way. With the US economy on a firm footing, the markets are on full notice that the cost of US money is going up. And it is not just in the US where the effects will be felt. The aftershocks will be felt globally.”

Yikes!

#123 patrick swayze on 04.21.17 at 12:10 am

you people who have a grin from ear to ear when you you get pumped because you think the housing market is finally going to crash in the GTA..

..at what price will you buy at? what area and type of house are you waiting for at what price and interest rate?

#124 patrick swayze on 04.21.17 at 12:13 am

#112 PM on 04.20.17 at 10:47 pm
affordability will likely never return to GTA. Anyone who does not own a property to hedge against the increase are screwed.

I am not a home owner and I spent 8 years in school to become a professional. I should have spent 6 months and got my RE license, at least this would have helped with 7.5 years of opportunity cost.

———-
its really not as easy as you think. yeah you can be an idiot and get your real estate license. I did. anyone with a grade 10 could do it. so its possibe ricky on trailer park boys could do it too.

but its a popularity contest in the end. if you aren’t #1 on ppls minds and spend a shit load on advertising you will lose money.

I’m an amature landlord who got my real estate license . wasn’t hard to get the license but to find the customers isn’t easy. too many dogs chasing the same bone

#125 Ted54 on 04.21.17 at 12:39 am

“Oooohhhh ‘Realtor Handcuffs”
Perhaps if you had your facts right the rest of your comments might have some value. The failed politician you mentioned works for OREA not RECO

#126 Karma on 04.21.17 at 12:41 am

#51 Drew on 04.20.17 at 7:24 pm
“A friend of mine lives in Toronto but owns a condo in Vancouver. Both him and his wife are from Vancouver and they go back to visit family and they plan to retire back there. They bought the condo years ago as they saw prices going up and wanted to buy before prices got to far out of reach. Anyway, with the stupid new vacancy rules they have to sell or rent out their place. Now they are neither foreign buyers or flippers, they are just normal people planning for their future and the like usual the government has decided to screw them over.”

Answer: Rent it out until they retire. Stay at relatives when they do visit. Not rocket science.

#127 Victor V on 04.21.17 at 12:41 am

This piece from s month ago with Brad Lamb stating a foreign buyer’s tax would cause a recession:

http://www.cbc.ca/news/canada/toronto/canada-wide-recession-could-follow-foreign-buyers-tax-in-toronto-brad-lamb-says-1.4038750

#128 Kat on 04.21.17 at 12:42 am

None of these measures worked here in Vancouver the party is still going. Sadly now rentals are reaching sky high which is sad as so many condos are empty.

#129 steve on 04.21.17 at 12:47 am

“I was visiting a friend in Phoenix in 2009, and as we drove out of the city, we could see entire developments, one after another, brand new, dark and empty.”

==========

No we will not. Unless all the people who live in the GTA magically disappear.

Housing starts aren’t out of wack with population growth…

#130 Vancouver on 04.21.17 at 1:02 am

#112 PM
Please don’t feel like your education is a waste. Real Estate hights come and go, but nobody can take your education away. When realtors start droping like flyes, your time will come. And remember, there are lots of realtors who don’t make lots of money. Few make the most. One of my friends is a realtor, but even in a hot Vancouver market, she maybe makes few good sales a year. In a bad market, even worse. Go with your education and feel proud of it.

#131 data on 04.21.17 at 1:20 am

Read between the lines in this post. BC did it, nothing really happen to prices. Don’t expect you are going to get that Bridle path home for half off.

Rent caps. Now this is a wait and see, i don’t think anyone really understands how this will be written into renter occupancy law at this point

#132 data on 04.21.17 at 1:26 am

Why doesn’t anyone look at supply? It’s so clear we have so much demand for property, Can it be we don’t have enough supply and prices could simply go higher from local activity?

#133 SimplyPut7 on 04.21.17 at 1:40 am

#113 Ron on 04.20.17 at 10:47 pm

Yes, that is what Ontario will look like, take a look at the MLS listings and see the crap “investors” are trying to unload, square box condos will wall kitchens that developers and real estate brokers told them would be sold instantly to millennials as a starter home or rented out for $1800 – $2500 a month.

I like many Millennials don’t want that garbage nor could I afford the $2400 a month rent they want that they think all of us we get from the bank of mom and dad. Those people will just have to go bankrupt as they can’t unload their expensive investments on to anyone else.

I don’t have to live in Toronto, it’s easier for me to commute into the city and go home everyday to a home I love then buy their 500 sqft for $400,000+.

#134 Iknow on 04.21.17 at 1:53 am

Meanwhile real estates market in YVR heating up for ‘cheap’ housing under $2M.
Cheap old Surrey townhouse that was not sold at $300k last November was relisted at $350k and sold before open house for $360k.

#135 NoName on 04.21.17 at 2:00 am

China’s newest bubble, bike bubble.

http://bit.ly/2pXOGWq
—-
Restaurants are kicking big box stores @$$, in a hind sight maybe I should have few more breakfast s at Zellers…

http://bit.ly/2owlqFq

—-
And interesting article how offshore money and re.

http://bit.ly/2oQkjna

———

#136 Depends on leverage & psychology now... on 04.21.17 at 2:10 am

Agree with Garth and toronto1 that the 416 Condo market is pooched provided that there is a high degree of leverage in speculator, flipper mortgages.

If very high, then it will play out over the next few months as a kicking and screaming stampede to the turnstiles to get out at any price.

OR, speculators, flippers may kick the can down the road with HELOC’s and/or consumer credit (or more Bank of Ma/Pa help).

I also agree with other Commentators that psychology here is equally important as recessions are half economy and half psychology. I believe many will bolt for the turnstiles and that information will get out soon enough; thus, the psychology will create price drops soon enough.

Soon enough is about 4 months as YVRs implosion took from May to September 2016 to play out.

And YVR is still playing out with large price drops 1 year later, speculator/flipper losses per “For those about to flop…” – the latter again thanks for the excellent info, continue your posts “flop”.

#137 b riding dirty on 04.21.17 at 2:18 am

no plunge has taken place. a out of reach peak to a 3 month prior new normal, with known average 2 month sellings. is the truth.

craz kicker.

look at areas like aldergrove bc today. you have bidding wars.houses once worth 450k 4 years ago iinsane times 600 – 650. today listing for 640 bid wars to 700 plus.

times maybe a changing but the market aint stopping and your heart will still be breaking.

i miss the legend RiP smokingman hope garth misses you and wants you back likes he wants the houses burst to finally prove him right. just hope all your fans dont have to wait ten years and it sucks we will miss all your 1 out of 3 useful rants if he holds out as long as the houses rush has,

but nelson mandela was locked up for 35 years and stayed strong got wisers and held no hate!

speaking words of wisdom let smokingman free let him free!

#138 b riding dirty on 04.21.17 at 2:22 am

and is see hes back,

thank you. delete the last post . top part true and on paint second part pointless. greaterfool i am grand teacher jedi.
to bed i go

#139 When Will They Raise Rates? on 04.21.17 at 2:42 am

#109 Pete on 04.20.17 at 10:31 pm

No spinning out of this one. RE is toast. When the condo domino falls it will knock over SFH and those who wish to delude themselves can if the wish. Home Capital is yet another domino that will speed up the housing pozni crash. Speculator can no long flip pre built condos or houses and now people will visually see EMPTY pre-sales for both houses and condos. People who “own” SFH are MAXED OUT and living in a glass house which is about to be hit with rocks.
—————

^ Excellent post.

#140 Koshy Alex on 04.21.17 at 2:42 am

I still think oil crash 2.0 will have a bigger impact on Canadian housing and the world economy. With all these Middle East countries in deep financial trouble they will not be able to make further cuts to production and very soon we are going to have a bigger glut than last time.

Was talking to a friend who runs a small business in Sharjah, UAE. He said rents are coming down and apartments that used to rent for 32k annually, is now renting for 28k. The last time rents started going down was in 2008 after GFC. Also traffic on the road is getting thinner, lot of people are losing jobs, and small businesses​ are finding it hard to get payments​. We live in an interconnected world economy and these things do not support the Central Bank party line that world economy is in a recovery mode. When one of these dominoes start to fall it is going to have a very big impact on the world economy and we will not be immune to this when this happens.

#141 NoName on 04.21.17 at 3:10 am

Interesting read.

“Why gay French men are voting far right”

http://bit.ly/2owKA6N

#142 Looney Baloney on 04.21.17 at 3:21 am

If HC goes under, will the debtors be forgiven? Might just be what the market needs.. Time to load up on debt, prices are only going uppa Uppal!

#143 YVR Update on 04.21.17 at 3:40 am

Nothing will change in Ontario. Foreign students are still allowed to buy with their parents gazillions.

#144 nubbers on 04.21.17 at 4:13 am

Has anyone else noticed a pattern in the comments section recently?

There are several commenters, all with short names, who repeat either the “missed opportunity” or the “buy now or miss out” meme, and who all make very basic punctuation mistakes.

I don’t think it is the same person because the pattern of errors is different in each case. Maybe they all work out of the same RE office, who knows?

#145 tony on 04.21.17 at 4:22 am

Can foreign investors target Montreal? Mega condo projects are being announced. The city’s budget is in the black and most of it’s taxed revenues are from condos.

#146 NoName on 04.21.17 at 5:34 am

interesting reads

A majority of people in B.C. think their government is essentially an oligarchy.
http://bit.ly/2pKg23g

Interesting read about Russia
http://bit.ly/2oQAfWI

“More than a dozen prominent Washington research groups have received tens of millions of dollars from foreign governments in recent years while pushing United States government officials to adopt policies that often reflect the donors’ priorities, an investigation by The New York Times has found.”
http://bit.ly/2plbzqE

London School of Economics warns that current laws are unable to ensure a free and fair election.
http://bit.ly/2pl9oTY

#147 Lessons from Casablanca on 04.21.17 at 6:02 am

Strasser: I advise that this place be shut up at once.

Renault: But everybody’s having such a good time.

Strasser: Yes, much too good a time. The place is to be closed.

Renault: But I’ve no excuse to close it!

Strasser: Find one.

[Strasser leaves, ending the conversation; Renault walks into the middle of the room and blows his whistle]

Renault: Everybody is to leave here immediately! This cafe is closed until further notice. Clear the room, at once!

Rick: How can you close me up? On what grounds?

Renault: I am shocked — shocked — to find that gambling is going on in here!

Croupier: [hands Renault money] Your winnings, sir.

Renault: Oh, thank you very much. Everybody out at once!

#148 A Reply to #35 Sitting and Thinking on 04.21.17 at 6:41 am

“Until the boc makes money more expensive it won’t do much to curb the insanity.”

Maybe so, but action in a market takes place at the margin.

#149 ANON on 04.21.17 at 6:47 am

This would have ended extremely badly in 2008 when you started the blog (congrats on keeping it going for so long!). Now, there won’t be any dust left to settle, by looking at that chart. Too many private promises without the physical IOUs commonly accepted for tuna cans. Of course, if the physical IOUs would exist, they would be perceived as worthless, but they don’t, and they can’t be printed fast enough, they’d have to be on the public’s balance sheet of promises for that to happen. BigD was always inevitable. The other alternative would have been BigI morphing into BigH(yperinflation), if the government would have really provided them. It is all in the mind, just like HCG’s “melted” value.

#150 Berniebee on 04.21.17 at 7:35 am

#51 Drew “They bought the condo years ago as they saw prices going up and wanted to buy before prices got to far out of reach.”

Well I just burst into tears for your poor, poor, just normal friends, who have residences in two of the most expensive locals in the world. (Maybe we could start a collection here on the blog?)

They bought “years ago”, so doubtlessly have a substantial equity position in the B.C. condo. But geez, you say, they are now “forced” into either collecting a large windfall (By selling) or collecting a monthly income (renting). And (Gasp!) they might have to pay more income tax! Oh, the humanity…

BTW, has it occurred to you that by occupying two properties, they are part of the problem?

#151 TorontoBull on 04.21.17 at 7:42 am

Too many loopholes for the foreign tax to have any impact

#152 Fanshaw on 04.21.17 at 8:24 am

I’d say that cute little kitty cat is the BEST comfort for that ailing dog. That’s no ‘cold comfort’ as the headline implies!

#153 traderJim on 04.21.17 at 8:24 am

#72 Trumpocalypse
“CHINA BOMBERS ON HIGH ALERT!!!!!!

Stay calm.”

HOW CAN WE STAY CALM WHEN THE WORLD IS GOING TO END TOMORROW????!!!!

OR MAYBE THE NEXT DAY?

#154 choptstix on 04.21.17 at 8:30 am

Scamcouver has never felt so cold and desperate:
CBC Vancouver: ”This — is — nuts’: Why hundreds lined up to see a $1,200 two-bedroom co-op suite”
http://www.cbc.ca/news/canada/british-columbia/this-is-nuts-why-hundreds-lined-up-to-see-a-1-200-two-bedroom-co-op-suite-1.4078756

yeah i rent and feel like a 2nd class citizen because of it..being solo and owing (as a middle incomer) isn’t easy these days…had no loan from parents (they passed away early on).

such desperate times we’re in, if you’re middle class (only feel more for lower classers):
the feeling amongst many of us is, if you don’t already own in Vancouver you’re f**ked:
either you get in and feel crushed with crushing debt loads and worry about rising interest rates/job losses, RE prices tanking etc (let alone extremely angry how our politicians have f**ked us over and buried their heads in the sand over so many issues (shadow flipping, allowing speculators, foreign buyers etc, stupidly low interest rates for too long etc)
or
if you rent and are middle income then you feel equally crushed and worried that you can find and ”afford” some decent place to live and not be stressed out all the time when your lease renews or when your building mgmt (or new buyers/owners) kick you out for a rennoviction or jackup your rent 30-100%.
no wonder there is rent control….and yes i get it: it’s not perfect either: there has to be some way to allow for rises in costs for prop owners while still being real for the tenants’ middle income wages who live there
”Rent doubles for tenants of 2 west-end Toronto condos, province says reform coming”

http://globalnews.ca/news/3355767/toronto-rent-doubles-rent-control/

A ”home”, whether you rent or buy, is supposed to offer a refuge from life’s stresses….sure not happening to many of us out there.

#155 maxx on 04.21.17 at 8:35 am

“Which is why we could use that tax on stupid.”

Absolutely. There used to be one. It was known as normal rates. That kept a huge whack of fools and greed from distorting the crap out of markets.

Was in one of the big 5 banks yesterday and a manager told me that staff are essentially being whipped to sell, sell, sell as mortgage sales are dropping. This person looked extremely sleep-deprived. I asked if it was mainly a case of shadow lenders nipping at that portfolio and the reply was that it was other big banks as well. The big 5 and the lesser lenders are eating each others’ lunches.

The ONLY thing that will stop these fiscal robots from completely destroying the economy outside of their balance sheets are normalized rates.

Conclusion: Stupidity doesn’t only exists in the consumer arena- tptb own the majority of that trait. They caused this mess and just don’t know when to stop.

#156 SilverSon on 04.21.17 at 8:39 am

#123 patrick swaze

What makes you think that people that are sitting back and watching the crash also secretly want to buy a house? I certainly don’t. I could care less. My interest is in the correction of the RE market so the Canadian economy has at least a tiny glimmer of hope of becoming sustainable. And if some people are secretly wanting to buy RE, if they were smart enough to not buy in the past two years they’re likely smart enough to realize that the market took 7 years to reach the “bottom” last time around. Furthermore, with money losing value at a rate of 2-3% a year, $1M in 7 years will be worth the same as $880k now. It’s unlikely that anyone who has been waiting is going to rush out and buy something now. Only a greater fool would. Interest rates go up and down but you can NEVER change what you paid for something after you bought it.

#157 Game Over on 04.21.17 at 8:44 am

I highly doubt these measures will have an effect. Maybe the assignment clauses measure will take some steam out of the market, but everything else is like trying to put out a fire with a spray bottle. For instance, Making sure the elevators are repaired within a certain amount of time is one of the points in the 16 point plan! Umm… better start unloading that condo now because the 3 other serviceable elevators just can’t handle all those Chinese guys and their briefcases of money!

At the end of the day, there is nothing to stop the fact that there is 10-15 offers on a property, money is dirt cheap and the whole process is more shady than trying to go in to business with the russian mafia.

Just run the numbers and even getting started in an entry level s**t box doesn’t make sense, even at low low rates. Factor in daycare costs, transportation, food, etc., and people gotta be burning up credit cards, LOCs and HELOCs to get by.

If the rest of the country’s real estate is supposedly balanced then a 1% rate hike won’t affect them no? But then again, everyone knows we are too dependent on RE related revenues to blow this thing up now.

Garth is right, this thing is eventually going to stall out. I just don’t know how there is enough thrust to keep this thing going into the stratosphere. You would ideally want to bring this thing down like the Falcon 9, but it is increasingly looking like it is going to be the Challenger.

The Feds had a chance to kill it early, but now we are past the event horizon.

#158 jess on 04.21.17 at 8:44 am

when all the positive spin(fake news) gets harder to spin
Mr. Lereah: “I put a positive spin on it It was easy to do during boom times, harder when times weren’t good. I never thought the whole national real estate market would burst.”
Mr. Lereah, who says he left NAR voluntarily, says he was pressured by executives to issue optimistic forecasts — then was left to shoulder the blame when things went sour. “I was there for seven years doing everything they wanted me to,” he said Mr. Lereah admits to one mistake: believing there would be no national housing crash. “I have to take the blame for that,” he says. “I never thought it would be as bad as this.
http://davidlereahwatch.blogspot.ca/2008/12/david-lereah-admits-he-spun-for.html

=================
Police in Germany have charged a man suspected of being behind an attack on the Borussia Dortmund team bus.

Rather than having links to radical Islamism, he was a market trader hoping to make money if the price of shares in the team fell, prosecutors say.
The suspect had allegedly bought 15,000 put options on Borussia Dortmund shares – reportedly priced at €78,000 (£65,000; $83,600) – betting that they would drop sharply after the attack. He would have profited from this fall.

He was staying at the team’s L’Arrivée hotel in Dortmund on the day of the attack and had moved to a room on the top floor, overlooking the street where it took place, prosecutors say.

The suspect placed the bet on 11 April using an IP address traced to the hotel, after taking out a loan for the money. (bbc)

#159 Grantmi on 04.21.17 at 9:01 am

#32 slam on 04.20.17 at 6:59 pm
Too late to short Home Capital stock?

Is this a good option to use to short Canadian real estate?

You should have done it when I mentioned look at HCG last werk

#160 Dan.t on 04.21.17 at 9:05 am

So it’s ok to cash out hundreds of thousands of dollars tax free for years by flipping condos and houses, but sell a stock, bond or mutual funds the tax man bangs down your door for the capital gains or what ever tax needs to be paid.

What a one sided scam real estate has been. Banks risk nothing, loan buyers 95% or more to leverage an investment or to speculate, those who do so, get tax free gains. Never has it been so favourable to invest in one asset class. Free money for everyone…just cash out in time and enjoy your retirement.

Yep, Government has your backs people…now after 16 years, now that everything has gotten way out of control, and has been out of control for about 10 years, they are here to help.

Can’t fault the sheeple. Of course people will take advantage of it but look what it’s done to major cities and prices in Canada. Great policy. Turn housing into a casino and in Vancouver, open up the flood gates so China buyers can play the game too. That seems fair. Poor working stiff Canadians have no chance anymore.

#161 Tudval on 04.21.17 at 9:12 am

#151 Of course they had to make all those exemptions and not repeat the blunder BC made with their xenophobic tax. Unfortunately, it still makes no sense: it’ll have little effect, except to please that part of the electorate that IS in fact xenophobic. They should have just stand their ground and leave it alone. I don’t disagree with the concept, but at this point is well… pointless.

Let me give you another example: When Trump says “I love Mexicans, but I’m going to build a wall to keep drugs out “.. the question is.. will it really keep the drugs out or is he doing it just to win votes from Mexican haters, even though he exculpates himself at every occasion saying how much he loves them?

#162 Dups on 04.21.17 at 9:18 am

Hey if we build a high speed rail from Montreal to Toronto to Windsor, it is guaranteed to naturally cool down the Housing bubble in GTA! Two birds with one stone! What do you think Garth. Can you pitch this to the right channels?

#163 Vit on 04.21.17 at 9:31 am

One thing for sure, next year I will sell my detached house 200-300K more then today value.

#164 Walt Stevenson on 04.21.17 at 9:36 am

#61 Foreign Capital vs Rates on 04.20.17 at 7:55 pm

They didn’t actually ban assignment flipping, they’re just going to “look at it.”

Between that and the huge loopholes for the China dudes tax – students and corps can still buy – I don’t see these rules having any significant impact at all.

Now that Wynne has completely fanned on the new regulations the only thing that can pop this balloon is rising interest rates. And that’s at least two years away from being significant.

I estimate at least another 30-40% growth before we actually got peak here in Drakeland.

#165 Ole Doberman on 04.21.17 at 9:37 am

#116 Former Fool on 04.20.17 at 11:27 pm

Anybody have any news on real estate in Calgary? My own observations:

-In my old neighborhood, the price I sold for in 2014 now buys a house with an additional bedroom, an extra bathroom, and a couple hundred extra square feet.

-A few houses I’ve looked at on realtor.ca get de-listed (or sold for all I know) and end up on rentfaster.ca.

I ask as I’m surprised Calgary home prices haven’t come down further. A few of my coworkers are convinced Calgary’s house prices will keep climbing after a pause, based on sales in their neighborhoods. Would appreciate some insights on this topic. A Garth post on this would be great as well, we haven’t had a post on Calgary R/E in a while.
——————————————————
In my hood of Varsity a place was listed for $684K and sold in one week. It was a nice place newly renovated.
Varsity is also a desirable neighborhood – not sure it’s like that everywhere.

There is tons for rent on rentfaster.ca

#166 Bat Flipper on 04.21.17 at 10:01 am

Canadians have borrowed more in the past 10 years, then over the past 100. Incomes stale, and people living on credit cards, home equity lines of credit.

TBH, people say they want affordable housing, but the majority want values to go up forever, so they can keep getting deeper and deeper in debt.

Is this the end? For condos, sure. Houses, will continue to go up based on supply and demand.

#167 jess on 04.21.17 at 10:20 am

Australia housing policy changes
http://www.theage.com.au/federal-politics/political-news/labor-hits-foreigners-vacant-properties-and-super-funds-in-housing-affordability-package-20170420-gvolrj.html

Opposition says: the problems are with negative gearing:
“Negative gearing involves investors borrowing enough money against a rental investment so their mortgage payments exceed the rental .That creates a tax loss which they can offset against other income, like a salary, to reduce their tax bill in the short term while retaining long-term gains from the increase in their property’s value…tax breaks for property speculators to get even richer…and in the process, these tax breaks are turbo-charging a speculative real estate market that is driving house prices beyond the reach of most people.”

======
DEFINITION of ‘Negative Gearing’ from investopedia

Borrowing money to buy an investment asset without receiving enough income from the investment to cover the interest expenses and other costs inolved in maintaining it. Depending on the investor’s home country, the shortfall between income earned and interest due can be deducted from current income taxes. Countries that allow this tax deduction include Canada, Australia and New Zealand.
BREAKING DOWN ‘Negative Gearing’

Negative gearing most often occurs in rental properties, where the rental income received isn’t enough to cover the interest costs on borrowings plus expenditures toward property maintenance and upkeep.

Negative gearing only becomes a profitable venture when the property is eventually sold, and a prerequisite is that property values are rising, not falling or holding steady.

#168 Nick's nickel's worth on 04.21.17 at 10:27 am

Garth mentions “intense scrutiny” of assignments. Did they not ban assignment flipping altogether? CBC reported they were expected to do so. Or did the government chicken out.

Re Smoking man comparing himself to an great American lit Nobeller.
I’ve read most of Hemingway’s books. Hemingway was a literary idol of mine. Smoking man, you’re no Hemingway.

#169 Penny Henny on 04.21.17 at 10:36 am

Smoking Man’s castle.

https://www.realtor.ca/Residential/Single-Family/18055167/57-JAMES-Street-Toronto-Ontario-M8W1L4-Long-Branch

I see you fixed the shower handle.

#170 Lesley Price on 04.21.17 at 10:37 am

Wow a new detached home just came up in Long Branch that is out of this world. Someone of importance must be living there because it is gorgeous inside with furniture right out of Forest Hill; the updates are outstanding. I just might make an offer for my daughter as a gift, but
will raise the price on this gem.

#171 Penny Henny on 04.21.17 at 10:40 am

Blog Dog contest.
Guess how much Smokies castle sells for.

I guess 1.16M

#172 soost on 04.21.17 at 10:46 am

I agree with #151 – the new tax is swiss cheese. Exemptions out the wazoo.

But really – nothing to curb domestic speculators? COME ON. Let’s limit the amount of new construction one can buy within a given time period. And most of all make sure that all of the pre-construction purchasers are Arms length from the builder – this includes trades and their families.

You would think they hadn’t had enough time to look at ways to regulate Agents. Look what it took for coward Hudak to give the illusion of a policy review.

Nothing happened yesterday besides insult…. pure insult

#173 Ted Kesik, Building Science Professor, UofT wrote: on 04.21.17 at 10:59 am

There is damaging problem with the hundreds of condominium tower buildings recently built across the GTA. It has to do with glass – not falling glass, but glass used as the primary building envelope that separates the indoors from the outdoors. Virtually all of the glass condominium towers feature window wall systems that enclose the entire facade of these buildings. Window walls are thermally inefficient compared to curtain walls or punched windows, and they also exhibit questionable performance in terms of durability, air and water leakage. Industry experts forecast that many of
these window wall systems will require extensive retrofit or replacement within 15 to 20 years after they have been constructed in order to remediate these performance problems. Owners of these buildings, and purchasers of buildings that are now under construction, are often not aware of the potential liabilities associated with their real estate investments. When they come to understand the risk they have incurred, it is only natural for them to want an explanation for how this situation came about.

It is not unreasonable to expect real estate agents to be forthcoming with vital information about the durability and operating costs of the buildings they are selling. Explaining the potential problems associated with glass condo towers that have been identified by technical experts to their prospective buyers, would be no different than a general practitioner explaining the risks associated with certain medications and procedures to their patients. The real estate industry has not taken a proactive approach to such issues yet it is usually the first point of contact for consumers of real estate.

The average person does not know how a modern building works, let alone how to assess the quality of a building. The building science that underpins an understanding of building behaviour is not taught in elementary or secondary schools even though it is far less arcane than astronomy. The average consumer knows a great deal about the things to look for when buying a smart phone, a laptop computer, or a big screen TV, thanks largely due to the educational advertising campaigns launched by manufacturers, who must explain why last year’s model has been superseded in performance, and is therefore no longer cool to own. Unfortunately, when it comes to housing, granite countertops, master bedroom ensuites, interior finishes and special features dominate the marketing mantra, with all considerations obeying the gods of location and affordability. Are consumers ever told that a $10,000 premium for more insulation and better windows would yield some $20,000 in savings over the 25-year mortgage? The sophistication of financial analyses supporting the developer’s investment plan stands in stark contrast to the complete absence of consumer awareness about issues like life cycle cost or durability, both of which significantly impact the consumer’s real estate investment.

These are uncertain economic times and yet the sales of condos in the GTA continue unabated. How many buildings are exposed to the risk of failing to perform according to consumer expectations? Why are glass condo towers designed by architects and engineers performing worse than single family homes constructed by homebuilders?

Inferior quality building envelopes and deferred maintenance will eventually deflate the prices of resale condo units. A generation of new condo buyers that is planning to build equity and eventually move up to single family detached housing as they form families will be stranded with devalued assets. And so will the empty nesters who cannot sell their homes and get on with retirement. If anyone other than new condo buyers should be concerned about the glass tower condo conundrum, it is the baby boomers who are expecting the appreciation in their real estate investments will be realized along with their retirement plans.

Will history in the GTA repeat itself? High-rise apartment buildings of the 60s and 70s were once ‘chic’ cribs with underground parking and indoor pools. Now many of them are home to Toronto’s priority neighbourhoods. Is this the fate of today’s glass condo towers, to become depreciated investments that are unloaded as low income rental housing awaiting renewal?

#174 Contrarian Coyote on 04.21.17 at 11:00 am

Nice to Peterpatch & the Kawarthas in the “Golden Horseshoe.”

I’ve noticed some houses in the area are reducing prices. Also, some higher-end lakefront houses north of Peterborough are up for sale or have been for months and months. Most are owned by GTAers. Maybe they’re trying to free up some cash for their next purchase in the GTA.

#175 GTA Girl on 04.21.17 at 11:13 am

“I was visiting a friend in Phoenix in 2009, and as we drove out of the city, we could see entire developments, one after another, brand new, dark and empty.”

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

Its the reverse. Empty dark condo units. Multiple empty one bedroom studi apts in city core. So many 40 somethings in Vaughan sunk money into investor condos in Toronto, because of “Friends & Family” pre-sale parties by their Condo developer pals. There’s a guy who runs a small shop in Woodbridge who has 4. Hell my hairdresser has two in City Place. This was to be their retirement money. They’ve been covering the monthly losses till now. Its from a old tale from Italy. There’s always some big rich family that owns thousands of apartments in Milan that can afford a Bugatti. This trickle down tale is about to cause debt, bankruptcy and end any retirement dreams for many.

“Buy a condo, don’t bother to save for retirement, mutual funds and stock market are a sham. You can move into one of them when you’re old” with the low quality of some of the construction in recent years, many of these condos will be money pits.

Empty concrete dreams in the sky.

#176 paulo on 04.21.17 at 11:14 am

#95 RET

You are on the money there. the fact that banks continue to hand out mortgages in markets that there own CEO’s
in addition to every other financial/policy group have described as in a dangerous bubble condition with almost certain value correction coming speaks volumes

How any underwriter justifies granting a mortgage
in these areas unless there is a 50% down payment is beyond me.

#177 GTA Girl on 04.21.17 at 11:23 am

To: Ted Kesik, Building Science Professor, UofT

Thank you for posting this. Exactly. The new money maker will be in restoring these glass elephants. Though I fear the added confusion that many of these condos are badly managed with absent owners. with any crash in RE, the chaos of a failing structure in midst of downtown will fall on the city and province.

I cringe when I see developers glad hand each other over environmental awards, when they’re creating the worse inefficient monstrosities. Selling uninsulated concrete lined boxes w/glass to buyers. Pretending these are energy efficient is mind blowing. Throw in poor construction, we will be dealing with this mess for decades to come

#178 For those about to flop... on 04.21.17 at 11:24 am

#158 Penny Henny on 04.21.17 at 10:40 am
Blog Dog contest.
Guess how much Smokies castle sells for.

I guess 1.16M

/////////////////////////

Joking Man might have waited a month too long but I will give it a stab.

1.23….it’s as easy as abc…

M42BC

#179 Gasbag Boomer on 04.21.17 at 11:31 am

#159 Penny Henny

Did a drive-by this morning, it’s a cute place. Love the scrapyard down the road!

I’m in for $1.2M

What’s the prize, liquid dinner at the Seneca?

#180 Trump in a China Shop on 04.21.17 at 11:34 am

” U.S. President Donald Trump’s apparently offhand comment after meeting with Chinese leader Xi Jinping — that “Korea actually used to be a part of China” — has enraged many South Koreans.

“The historically inaccurate sentence from a Wall Street Journal interview bumps up against a raft of historical and political sensitivities in a country where many have long feared Chinese designs on the Korean Peninsula. It also feeds neatly into longstanding worries about Seoul’s shrinking role in dealing with its nuclear-armed rival, North Korea.”

http://www.ctvnews.ca/world/ap-explains-how-a-single-trump-sentence-enraged-south-korea-1.3378452

Has Trump not been assigned a protocol officer? Or is it just a hopeless case? Taping Trump’s mouth shut may be the answer, but I suppose it’s not dignified.

Which group of people (besides the Deplorables) has Trump not insulted?

#181 Johnny Boy on 04.21.17 at 12:08 pm

#179 Gasbag Boomer on 04.21.17 at 11:31 am

#159 Penny Henny
Did a drive-by this morning, it’s a cute place. Love the scrapyard down the road!
I’m in for $1.2M
What’s the prize, liquid dinner at the Seneca?
…………………………………………………………………..
Had to have a look and its not Smoking Mans place, no cigarette butts, abandoned booze bottles or dog houses.
Its gonna be a tear down anyway. Bulldoze and built a two story.

#182 Grey Dog w Stick on 04.21.17 at 12:08 pm

A better and sustainable solution to mitigate speculation causing sky rocketing GTA and Vancouver housing prices.
A flat 15% municiple tax on empty residences may cause a temporary pause in escalating prices, but Vancouver has started to escalate again. When the annual increase is 30%, a 15% tax is just cost of doing business.
That also does not even touch the other real concern of an 8% vacancy rate. There isn’t any Provincial or Federal income tax emanating from empty residences, necessary to fulfil those Fed/Prov mandates!
A sustainable way to control speculation impacting the residential market is to apply a reverse engineered Provincial and Federal missing income tax, based on the property’s MPAC valuation. Then apply the community’s ratio of average income to average property valuations to estimate the income such a resident family should general and apply the Fed/Prov taxes accordingly to the property owners.
If nothing else, it will ensure these properties are put on the rental/lease market to generate a nominal but at least taxable income.

#183 traderJim on 04.21.17 at 12:23 pm

#175 GTA Girl

I can tell you with 100% certainty that when TSHTF and the market crashes and shoddy construction comes to light that there will be a huge cry for taxpayers to bail out the poor speculators.

Debt forgiveness, help with repairing condos, etc etc.

So the folks who didn’t participate in the madness will end up paying for the folks who did.

Thank you nanny state!

#184 CalgaryRocks on 04.21.17 at 12:34 pm

Hey guys, long time since I haven’t been on here. Living in Silicon Valley right now. Commiefornia sucks for saving money but I’m here for some experience and the weather (which has sucked as well this winter, non stop rain)

Anyways, I am always amazed how in Canada, governments are actual 4 year long dictatorships.

This latest move from the Ontario government (and BC before that), would make Hugo Chavez proud.

To think that without any opposition whatsoever the government has changed the rules and effectively stolen millions of dollars from rental property owners.

On top of that, everyone is now to report to the Ontario Gestapo the purpose for which they are spending their own hard earned money on the biggest purchase of their life. Just to make sure that this is a government approved reason. So big brother ish.

But Canadians are too busy watching hockey (here’s a secret, a Canadian team will most likely never win the Stanley cup again) and getting fat on Tim Horton’s (not even Canadian anymore)

Crazy country, I bet the Liberals get re-elected in Ontario. Chavez did, and now, the same people that elected him are rioting in the streets.

#185 traderJim on 04.21.17 at 12:34 pm

#180 Trump in a China Shop

“Which group of people (besides the Deplorables) has Trump not insulted?”

He has not insulted the only important group: American voters.

Surprised you still don’t understand that, or the fact that he was voted in precisely to be a bull in a china shop. His supporters are only disappointed if he doesn’t break things.

But you keep on fretting over a some supposed ‘hurt feelings’, or a well done steak with ketchup. That will be sure to win the next election.

#186 TurnerNation on 04.21.17 at 12:37 pm

Finally pics of Smoking man’s sht bungee in Schlong Branch.
I will bid $500,000 for the gazeebo (aka Laneway house for Millennials) alone.

Note it has parking garages for two spacecraft.

#187 ronh on 04.21.17 at 12:38 pm

Garth you’re famous!

http://www.zerohedge.com/news/2017-04-21/worlds-worst-market-timer

#188 bdwy sktrn on 04.21.17 at 12:58 pm

flop;
ivar – 1.56 (higher than the ‘peak’ sale last spring by just a hair.)
forest hills – 120k OVER ask . 1.9.

there u go.
you do know a quick call to the agent will get you the same info. they are always happy to share.

#189 Deplorable Real Estate on 04.21.17 at 1:05 pm

#179 Gasbag Boomer on 04.21.17 at 11:31 am

#159 Penny Henny

Did a drive-by this morning, it’s a cute place. Love the scrapyard down the road!

I’m in for $1.2M

What’s the prize, liquid dinner at the Seneca?
..

LOL..he’s actually selling his house.. does the lucky buyer get free copies of his book!

#190 Braj on 04.21.17 at 1:16 pm

#173 Ted Kesik, Building Science Professor, UofT wrote: on 04.21.17 at 10:59 am
There is damaging problem with the hundreds of condominium tower buildings recently built across the GTA. It has to do with glass – not falling glass, but glass used as the primary building envelope that separates the indoors from the outdoors. Virtually all of the glass condominium towers feature window wall systems that enclose the entire facade of these buildings. Window walls are thermally inefficient compared to curtain walls or punched windows, and they also exhibit questionable performance in terms of durability, air and water leakage. Industry experts forecast that many of
these window wall systems will require extensive retrofit or replacement within 15 to 20 years after they have been constructed in order to remediate these performance problems. Owners of these buildings, and purchasers of buildings that are now under construction, are often not aware of the potential liabilities associated with their real estate investments. When they come to understand the risk they have incurred, it is only natural for them to want an explanation for how this situation came about.

It is not unreasonable to expect real estate agents to be forthcoming with vital information about the durability and operating costs of the buildings they are selling. Explaining the potential problems associated with glass condo towers that have been identified by technical experts to their prospective buyers, would be no different than a general practitioner explaining the risks associated with certain medications and procedures to their patients. The real estate industry has not taken a proactive approach to such issues yet it is usually the first point of contact for consumers of real estate.

The average person does not know how a modern building works, let alone how to assess the quality of a building. The building science that underpins an understanding of building behaviour is not taught in elementary or secondary schools even though it is far less arcane than astronomy. The average consumer knows a great deal about the things to look for when buying a smart phone, a laptop computer, or a big screen TV, thanks largely due to the educational advertising campaigns launched by manufacturers, who must explain why last year’s model has been superseded in performance, and is therefore no longer cool to own. Unfortunately, when it comes to housing, granite countertops, master bedroom ensuites, interior finishes and special features dominate the marketing mantra, with all considerations obeying the gods of location and affordability. Are consumers ever told that a $10,000 premium for more insulation and better windows would yield some $20,000 in savings over the 25-year mortgage? The sophistication of financial analyses supporting the developer’s investment plan stands in stark contrast to the complete absence of consumer awareness about issues like life cycle cost or durability, both of which significantly impact the consumer’s real estate investment.

These are uncertain economic times and yet the sales of condos in the GTA continue unabated. How many buildings are exposed to the risk of failing to perform according to consumer expectations? Why are glass condo towers designed by architects and engineers performing worse than single family homes constructed by homebuilders?

Inferior quality building envelopes and deferred maintenance will eventually deflate the prices of resale condo units. A generation of new condo buyers that is planning to build equity and eventually move up to single family detached housing as they form families will be stranded with devalued assets. And so will the empty nesters who cannot sell their homes and get on with retirement. If anyone other than new condo buyers should be concerned about the glass tower condo conundrum, it is the baby boomers who are expecting the appreciation in their real estate investments will be realized along with their retirement plans.

Will history in the GTA repeat itself? High-rise apartment buildings of the 60s and 70s were once ‘chic’ cribs with underground parking and indoor pools. Now many of them are home to Toronto’s priority neighbourhoods. Is this the fate of today’s glass condo towers, to become depreciated investments that are unloaded as low income rental housing awaiting renewal?

I agree. Good to see someone knowledgeable in their field comment on this. I worked with managing the construction of these for a little while. The quality is definitely shoddy, as the budget only allows for a certain level.

If you were to construct a higher quality, more efficient structure / envelope and product. How much more could this cost? 20% more? All the developers see is the upfront cost, not the life-cycle costs.

I think the following could help;

– high efficiency mechanical units,
– decreased window walls, higher efficiency panels (curtain walls)
– better insulation (spray foam is very good when used properly)
– I’d like to see smaller buildings of higher quality
– sun should be utilised to warm up the building where possible, heat should be funnelled up the building and not allowed to leak
– the building envelope quality is the #1 reason heat is lost. It just leaks right out of any hole or wherever there is poor design. This is especially true of these window walls. They will only deteriorate further. To replace them or repair them on an original $100million building could be worth $15million (complete guess).

#191 Smoking Man on 04.21.17 at 1:33 pm

#169 Penny Henny on 04.21.17 at 10:36 am

I see you fixed the shower handle.
……..

How do you know about my old shower ? I knew those Black out drunken nights at Southside Johnnys would come back to haunt me one day.

Is your real name Angel?

#192 Livin Large on 04.21.17 at 1:40 pm

There’s almost a universal rule in the equities markets that “by the time you me and Dupree know about something, the market has already priced it in”.

I suspect this is true with ON RE so, will these changes make any positive impact??? Likely not.

Just like tax evasion schemes masqurading as avoidance strategies, there are legions of accountants and tax lawyers drafting work arounds as we type here.

An awful lot of ingenious CAs and LLBs in thenBig Smoke burning the midnight oil to devise work arounds.

#193 Vancouver on 04.21.17 at 1:56 pm

http://www.theglobeandmail.com/real-estate/vancouver/vancouvers-presale-condo-market-reaches-fever-pitch/article34771425/

It’s ironic that realtors are complaining about not being able to get presale units for their clients. Are they all sold to friends and family? Don’t think so… Also, really big moment is that BC Goverment has left a loophole and there is no 15% foreign tax charge or presale condos, neither CRA can keep track of all these people flipping, scalping, and not paying tax. Great feeling to live in this city while 200 people line up to view subsidized ONE two bedroom on Fairview slopes.

http://www.cbc.ca/news/canada/british-columbia/this-is-nuts-why-hundreds-lined-up-to-see-a-2-bedroom-1-200-co-op-suite-1.4078756

#194 John Smith on 04.21.17 at 2:13 pm

Many think that the Montreal market is due to go up, with foreign investors moving away from Toronto and Vancouver.

http://www.lesaffaires.com/secteurs-d-activite/immobilier/immobilier-les-quebecois-peuvent-dormir-tranquilles-pour-l-instant/594525

http://affaires.lapresse.ca/economie/immobilier/201704/06/01-5086005-la-hausse-du-prix-des-proprietes-saccelere-a-montreal.php

Should we worry? Get in the market now, before Montreal prices get closer to those other markets?

#195 Penny Henny on 04.21.17 at 2:14 pm

#179 Gasbag Boomer on 04.21.17 at 11:31 am
#159 Penny Henny

Did a drive-by this morning, it’s a cute place. Love the scrapyard down the road!

I’m in for $1.2M

What’s the prize, liquid dinner at the Seneca?

/////////////////////////////////

I’ll smuggle a Honey JD to the Belfontaine General store on the 13th and winner gets first swig.

#196 Bond Junkie on 04.21.17 at 3:23 pm

A little surgical insertion on Smokeys bordello .. I say $1.222mm.

GTAgal/professor — this is old news, Garth did an entire post on it 3yrs ago round the time he called for the condopocolypse circa 2013. Sorry Garth facts r facts.
Good luck this weekend Stoj!

-Bj

#197 Johnny Boy on 04.21.17 at 3:40 pm

#191 Smoking Man on 04.21.17 at 1:33 pm

#169 Penny Henny on 04.21.17 at 10:36 am

I see you fixed the shower handle.
……..

How do you know about my old shower ? I knew those Black out drunken nights at Southside Johnnys would come back to haunt me one day.

Is your real name Angel?
…………………………………………………………………….
Small world. Angel is my wife’s name, actually its Angelia and we have been to Southside Johnnys once on a west-side tour one night. My buddy who is a real biker got into a little tussle there one night with some local boy. We left that place quickly, as he doesn’t really like the police and they don’t like him. We will be biking up to the meet in Caledon unless it rains. Angel is coming too.

#198 traderJim on 04.21.17 at 4:07 pm

#191 Smoking Man’s one nighter Penny Henny

Ohhhh now I get the animosity. Penny was what they used to call in the penny stock trade ‘a pump ‘n dump’.

It’s true what they say: A woman scorned…

#199 A Reply to #185 traderJim on 04.21.17 at 4:22 pm

I suppose I’m most upset that we no longer have a U.S. president with three digits in his IQ.

#200 Tudval on 04.21.17 at 4:41 pm

#185 traderJim But don’t you find it ironic for an ‘indispensable nation’ that everybody else is asking themselves the question “why do we need them?” and planning for workarounds?

#201 Boss on 04.21.17 at 4:57 pm

Nothing happened to dampen the market by the Wynne Gang. No amount of agitating and doomer blogs will change that.

Lower loonie, rates aren’t going up, Trump might bomb Iran (Persian money). Lots of inventory now, and it’s the time to buy in Toronto/GTHA before prices jump up this summer :-)

The only people who are getting screwed are condo owners who rent out. They can no longer raise rents by $1000 to get crappy tenants out…have fun at the LTB now LOL!

I do hope Garth runs next year in the provincial election. We need someone there to raise hell a bit.

#202 Mike in Edm on 04.21.17 at 5:00 pm

A few people asked about Calgary… From what I can gather, from talking with several of my friends whom got married, moved in together with a better half, etc… Many of them are ‘stuck’ renting out their other place, and pretty much all of them are at a negative cash flow every month.

They say they can’t sell (unless at a loss), so they rent, which means they are subsidizing someone to live in (and slowly damage) their 2nd place, at a discount, and it’s a giant PITA and they hate it but they feel they have no other option. My guess is they’ll suck it up until enough of the mortgage is paid off to sell and at what they think will be a break even point, but in reality, over the 5+ years they’ll end up owning it, they’ll really have sunk a lot more than break-even into it.

That is the situation with ALL but 1 of my friends in Calgary. The 1 is actually a professional landlord and he’s been buying, renovating, and renting property in (mainly) Calgary since long before the boom, so most of his properties are now paid off and he’s rolling in the dough.

#203 For those about to flop... on 04.21.17 at 5:00 pm

bdwy sktrn on 04.21.17 at 12:58 pm
flop;
ivar – 1.56 (higher than the ‘peak’ sale last spring by just a hair.)
forest hills – 120k OVER ask . 1.9.

there u go.
you do know a quick call to the agent will get you the same info. they are always happy to share.

//////////////////////////

Hey Broadway,thanks for the numbers.

Why would I call the agent when I can annoy you all day long?

Anyway if your numbers hold the one in North Van sold the place for exactly what they bought it for and would have to cover the expenses.

I don’t think the second guys made any money either.

The one in Burnaby sold for 60k more than they bought it for and so I doubt they will be cracking the champagne but probably relieved that it’s all over and only have to clean up a few gravy stains off their pants…

M42BC

#204 When Will They Raise Rates? on 04.21.17 at 5:24 pm

#187 ronh on 04.21.17 at 12:38 pm

Garth you’re famous!

http://www.zerohedge.com/news/2017-04-21/worlds-worst-market-timer
———————

Garth Turner getting featured on Zerohedge. How delicious is that?

Shhh… Nobody tell the zero guys what Garth thinks of their blog. LOL

#205 When Will They Raise Rates? on 04.21.17 at 5:37 pm

#183 traderJim on 04.21.17 at 12:23 pm

#175 GTA Girl

I can tell you with 100% certainty that when TSHTF and the market crashes and shoddy construction comes to light that there will be a huge cry for taxpayers to bail out the poor speculators.

Debt forgiveness, help with repairing condos, etc etc.

So the folks who didn’t participate in the madness will end up paying for the folks who did.

Thank you nanny state!
—————

Uh yeah, I don’t think so.

The second they try that I’m giving Canada the big middle finger, packing up and leaving. Anyone who can operate their business in any jurisdiction will simply walk away – Just the Romans did.

#206 Ryan on 04.21.17 at 5:41 pm

Interesting to note that in 1974 Ontario implemented a speculation tax (50% of profit reduced to 20%, eliminated in 1978) as well as a 20% land transfer surtax on foreign ownership, which they eliminated in 1997.

Weaker policies now than 40 years ago.

#207 Chaos on 04.21.17 at 5:59 pm

Wow…haven’t been here for a long while.

Won’t be back anytime soon.

Fair warning Dawgs.

February 2018, Pluto in Capricorn, Neptune in Pisces, Jupiter in Scorpio and Uranus moves into Taurus.
What does it mean?
Business getting killed, confused sanity and scams exposed, expanding destruction and changes in personal income and assets.
The sky is Way crazier than the ’30s.

Ciao

#208 Zerohedge ? on 04.21.17 at 6:30 pm

Is quoting Garth ?

Where am I?

:)

#209 Tudval on 04.21.17 at 6:30 pm

Are you sure it’s not Taurus moving into Uranus?

#210 Hey CalgaryRocks on 04.21.17 at 6:37 pm

By your own admission , how LITTLE are you saving in price gouging liberal California ?

Your rant was irony filled parody

#211 45north on 04.21.17 at 6:43 pm

Ted Kesik: There is a problem with the hundreds of condominium tower buildings recently built across the GTA. Virtually all of the glass condominium towers feature window wall systems that enclose the entire facade of these buildings. Window walls are thermally inefficient compared to curtain walls or punched windows, and they also exhibit questionable performance in terms of durability, air and water leakage.

CBC’s Condo Game made that point and it’s extremely worrying. If the buildings are fundamentally unsound then the whole thing is going to collapse and I mean financial collapse:
– from day one the rents don’t cover the mortgage and taxes
– the Province is about to cap rent increases
– at some point the owners are hit with special assessments to remedy the problem with glass walls

Now I have a right to be worried but I’m not an expert. If my worries turn out to be right, then the condo collapse is going to have a bad effect on the whole city. The measures proposed by Wynne and Sousa presuppose that the condos themselves are structurally sound. Generally sound. That’s the first priority.

#212 traderJim on 04.21.17 at 6:48 pm

#199 Low IQ

The guy worth $10 Billion who leads an absolutely phenomenal life and against all odds became the President of the USA, a feat that only 44 people in all of history have achieved, has a lower IQ than you?

The idiocy of that statement is obvious and pretty much proves where your IQ is.

#213 Tudval on 04.21.17 at 7:30 pm

#201 Boss I hope prices do not go up more, until the election. Apparently Kathleen Wynn is set to do whatever it takes to contain prices because she thinks it’s going to be an election issue. In the end she may be very destructive for the entire economy – she wants to win at any cost. I hope they get rid of her before the election, that will show some maturity on part of the Liberal caucus.

#214 Tudval on 04.21.17 at 7:36 pm

I don’t disagree that prices should be contained or moderated slightly, but you can’t use the big cannons to get results in 3 or 6 months, it could boomerang big time. These people who think this way are very dangerous, hopefully there’s still some cooler brains in our governments that can prevail. I was expecting more from Tory, he is one of the better ones we have oup there, but he seemed overrun by bigger bullies.

#215 westcdn on 04.21.17 at 9:37 pm

I like critters – particularly furry ones – I miss my cat Katy. She was smart and would follow me around. She was aloof except to me. I had to laugh when people tried to pet her.

Anyway I was staying in a hostel in Costa Rica when I was awoken by a large crash. I go outside in a torrential rain and find a large iguana lying on the ground stunned. It was about 4 feet long – mostly tail. I approach it and it ran – scared the hell out of me.

I would lie in the hostel pool and the resident lizard came out to watch me. I think it is called a green Basilisk. He had cousins. They stand up to run and I chased a few of them down the pathways.

It rained so much we had to be taken out by boat. We had to travel through the local bayou’s. The driver told me this was dangerous territory as the drug runners liked to bury their stash there. I arrive at the local airport and a heavy army platoon show up. It made me nervous. Then a small plane lands and the army guys proceed to off load boxes. Apparently to the locals, it happens all the time.

While in Guatemala I did a few midnight tours with a head lamp. Good thing because there are dangerous critters. I watched a boa constrictor eat a parrot. I got a kick from toucans. Their beaks are so heavy they can only fly at sea level. A lot of things only come out at night – can you say tarantulas.

I have respect for them. There was one I found – big sucker. So being who I am, I poked with my toe. It ran up to kneecap before I could blink. Mother that guy fast is all I could think. I don’t want to hurt him but I want it off me. I go to flick it off but it runs to my chest. So I try again. Now it takes off running over my face. Instinct takes over. As it is crossing my mouth, I blow it off. I won’t being doing that again for a long time.

Such is my life.

#216 Moosey on 04.21.17 at 11:17 pm

http://www.cbc.ca/news/canada/british-columbia/this-is-nuts-why-hundreds-lined-up-to-see-a-2-bedroom-1-200-co-op-suite-1.4078756

#217 Smoking Man on 04.22.17 at 9:44 am

When your done with communism.

https://www.world.tax/countries/cayman-islands/cayman-islands-tax-system.php

#218 Em on 04.22.17 at 11:28 am

Looks like Motley Fool called it back in 2016 –

http://www.fool.ca/2016/05/11/investors-be-wary-of-home-capital-group-inc-and-genworth-mi-canada-inc/

What are your thoughts on Genworth, Garth?

“Investors are especially concerned about Toronto, Home Capital’s main area. Real estate values there continue to skyrocket, something many pundits think has to come to a stop. Even with interest rates low, it seems as though the pool of first-time buyers is dwindling. Many people simply can’t afford to buy houses.

It’s obvious a prolonged slowdown in Toronto real estate will hit Home Capital, and hit it hard. This is the reason why shares are trading at eight times earnings. Not only will a slowdown affect new loan growth; it’ll also bring down the value of existing properties in the mortgage portfolio, which is not a good thing for a lender with many uninsured loans.”

And yet, I am on realtor.ca and a ridiculous 3 bedroom in Mimico is being listed at over $900K. I mean, give me a break…