Getting out

“So it starts,” says realtor Dan, “assignment sales for $600,000 townhouses in Oshawa.” Two new listings just hit the market, same development, same pitch by two buyers scrambling to get out of new builds before closing day:

Client Remks:**Assignment Sale** Stunning “Melrose” Collection Corner/End Unit From Tribute Communities**. Brand New Town House Under Construction **Expected Occupancy Oct – Nov 2017**Over 1800 Sqft ** 4 Spacious Bedrooms**Located On Peaceful Streets & Crescents**Enjoy The Ambience Of Contemporary Urban Village Setting**Proximity To University Of Ontario Institute Of Technology** All New Regional Shopping Center**Great Access To Community Trails, Parks, Golf Courses. Extras:**Brand New Stainless Steel Kitchen Appliances Pkg + Stackable White Washer & Dryer**. Monthly Condo Fee (As Per Corporation) Brkage Remks:**Assignment Sale** Agreement To Be Assigned. Buyer & Buyer Agent To Verify All Measurements & Taxes.

These days assignment clauses are sullied, with governments in BC and Ontario trying to stamp them out, suggesting they’re the modus operandi of the flipper set. In an assignment scenario, the buyer of a property (existing or pre-construction) is granted the right to assign the agreement of purchase and sale to another party. In other words, he can sell the paper to a second dude, who is then responsible for paying the seller on closing day. Flippers and speckers like this, since they can make a few bucks in a rising market without having to arrange a mortgage, pay land transfer tax or actually end up with real estate. It’s just a futures play.

“There are speculators who enter into agreements to purchase property with no intention of buying them or living them, crowding out families who want to buy their own home,” the Ontario finance minister said last month in announcing a crackdown on assignments. Now the province will require full disclosure, work with the CRA to ensure gains are taxed and land transfer levies paid.

But here’s a prediction: the use of assignment clauses is about to blossom as a wave of scared people try to exit from real estate deals (like new townhouses in Oshawa) because of the shifting economic sands. No doubt about it, the market in Merry May is a whole lot less happy then it was in March.

The latest proof (as if more is required): Friday’s jobs numbers. Ouch. And wages. Double ouch.

Here’s the news: last month we lost 50,500 jobs in the private sector, more than 31,000 of them full-time. We gained 34,300 part-time jobs. Overall the country added just 3,200 positions, all government hires or people creating their own jobs (no benefits, no pension).

That was a disaster. Worse: the average wage rose 0.7% annually in April – compared to 2% inflation and a 25% rise in Toronto house prices. This is the most dismal showing for incomes since the 1990s, and massively below the long-term average of almost 3%. More grief: 45,000 people left the workforce last month, half of them moisters who gave up looking.

At the same time, there’s a 90% probability US interest rates will rise again next month since their labour stats are positively Kardashian. Another 211,000 new positions in April, with the jobless rate at 4.4% considered to be full employment (and the lowest in ten years). Average wages increased 2.5% – or three-and-a-half times more than in Canada. So it’s a slam dunk the Fed will hike in June, then again once or twice before the end of the year.

Given four American rate bombs in 2017, with our loonie at 73 cents, it seems unlikely the Bank of Canada would risk cutting. So the march to higher money costs in both countries is inevitable. A new report from Desjardins this week warns people with mortgages that renewing at 5% in two years is something they should budget for. It also figures that’ll have a big impact on the price of houses.

For years now Canadians have been willing to swallow a steady diet of debt to buy houses their incomes could not afford. That made sense in a steadily rising market. The sacrifice had legs.

Now people must ask themselves if reward has turned to risk.

So, it starts.

154 comments ↓

#1 AK on 05.05.17 at 5:55 pm

“For years now Canadians have been willing to swallow a steady diet of debt to buy houses their incomes could not afford. That made sense in a steadily rising market.”
——————————————————————-
And, no more HCG to provide a suspicious mortgage.

#2 OttawaMike on 05.05.17 at 5:58 pm

Who was it that predicted 35 dollar oil on this blog?

Same guy also predicted no multiple rate hikes this year in USA..

#3 Rob Fortyyyy on 05.05.17 at 6:00 pm

Lots of the people that bought overpriced homes in the last couple months thinking that they’d use the equity in their existing homes for the downpayment are now having a hard time selling the existing ones.

They thought their house was “worth” way more that it was because they heard of neighbours selling for crazy prices.

Little did they realize that the “value” of your house is only in the price you get when you sell it and now they’ll have to drop their prices in order to fight off the added supply.

Patient buyers can take advantage.

#4 greyswan on 05.05.17 at 6:05 pm

When did the BC government add 15% foreign tax on pre-sale assignments or some sort of tax??

Should be no foreign transactions in pre-sales in Canada!!

Did Ontario add a tax on pre-sales lately?

#5 Dave on 05.05.17 at 6:06 pm

The real estate monster has 9 lives….apparently paying millions for house is normal.
Just let it die fast….bringing pain to the ones that caused it.

#6 Eurovision on 05.05.17 at 6:10 pm

I hear the new craze in T town is line ups to list.

#7 Lulu on 05.05.17 at 6:12 pm

New way to play— Crowd funding to buy RE with complete strangers…. like a speed dating. Exciting!!

#8 For those about to flop... on 05.05.17 at 6:19 pm

Pink Pollen falling in West Vancouver.

I remember seeing this listing in January and putting in my ” Possible Pinkies ” file, as I had a suspicion that they were going to have a hard time offloading it as the pool of high end buyers has shrivelled up like my private parts did when I was foolish enough to jump into a glacier fed lake up in the Rocky Mountains a few years ago.

They took on a lot of risk at perhaps at the wrong time shelling out 4.32 last July when Broadway’s bike pump was getting serviced as it was no longer pumping enough hot air into the market.

They have roughly 10% wiggle room at the moment but expenses will eat most of that and anyone who has that type of coin can haggle all they want because there are a number of people in a similar position in West Vancouver as these sellers at the moment and with average sales price down 12% with this shallow but stubborn correction someone will likely take the chance to be made whole or a small loss.

You wouldn’t want to be up Millstream without a paddle…

M42BC

1046 MILLSTREAM RD WEST VANCOUVER

Jan 25:$4,880,000
May 4: $4,780,000
Change: – 100000.00 -2%

1046 MILLSTREAM RD WEST VANCOUVER
https://evaluebc.bcassessment.ca/property.aspx?_oa=QTAwMDAyOUJLOQ==

https://www.zolo.ca/index.php?sarea=1046%20Millstream%20Road,%20West%20Vancouver&filter=1

#9 smallcapsteve on 05.05.17 at 6:20 pm

Poloz is going to raise rates here?

I can’t wait to hear what that “I’m Not Poloz” guy has to say about this….

#10 what happens on May 13th on 05.05.17 at 6:20 pm

Wasn’t there some super duper never before seen home buying opportunity on the 13th in Vaughn area? Pay now, don’t ask questions, get the keys in 2018 (maybe) and absolutely positively no subjects? Only approved buyers with cheque(s) in hand may even line-up?

Where are the suckers getting the financing now?

#11 Exemptions on 05.05.17 at 6:22 pm

#4 Grey Swan

When did the BC government add 15% foreign tax on pre-sale assignments or some sort of tax??

Should be no foreign transactions in pre-sales in Canada!!

Did Ontario add a tax on pre-sales lately?

———

The loophole in the BC Foreign Buyer’s Tax is that it excludes pre-sales.

Some journalists have pointed out that this exclusion is to the benefit of the Bob Rennie – the Condo King – and the BC Liberals Chief Fundraiser (until recently).

By the way, since the tax was implemented the pre-sale condo and townhouse market has been on fire, lifting the entire condo and townhouse market with significant price increases.

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

Draw your own conclusions as to what is driving that market increase.

#12 Exemptions on 05.05.17 at 6:24 pm

No offense ‘For this About to Flop’, your ‘pink snow’ examples are hardly indicative of any substantive price change.

100k reduction on a 4 million home is chump change and not even worth noting.

You have not provided one example over the past several months of actual prices declines.

I know you are exited about a potential price decline, but maybe try again in a year or two.

#13 Balmuto on 05.05.17 at 6:28 pm

Here’s how you make money in Toronto – demolish your house, double the value of your property!

http://torontolife.com/real-estate/heiress-selling-annex-house-5-million-house-not-included/

#14 oh ! happy day ! on 05.05.17 at 6:32 pm

I’ve never had an opportunity to be on this blog before. But i have read your blog for the last 5 years consistently.
I think you finally found the right nail and popped that balloon once and for all. I just wish i had bought a Mega Mansion years ago and sold it this early March. I would have probably made enough to retire and then told the Warden to stick it where the sun don’t shine……
Just remember you can’t take it with you…..

#15 traderJim on 05.05.17 at 6:36 pm

Braj and Kate

I sure would not recommend that novices get into shorting currencies, or anything else.

But advice to diversify your portfolio by holding US and possibly other foreign stocks is good advice. Personally, I’d suggest a much higher weighting in US stocks than most advisers, since it’s obvious the US market offers better returns, more liquidity, more diversity and a stronger currency.

I wouldn’t pay too much attention to emerging markets either.

But by taking your loonies and buying US stocks you are effectively shorting the Canadian dollar.

I wouldn’t go crazy at 73 cents, but I would consistently buy US stocks over time and pile in if the loonie somehow miraculously rises.

I’ll even be blasphemous and suggest a young person building a portfolio could and should have a 100% US equity portfolio.

Now all the re-balancers and deworsifyers can lose their minds hehehe.

#16 SunShowers on 05.05.17 at 6:38 pm

Overall the country added just 3,200 positions, all government hires or people creating their own jobs (no benefits, no pension).

———————————————————-

Government hires are pretty much the only people who get pensions anymore.

Unless they’re part time as well, but I haven’t seen much of that in the public sector.

#17 For those about to flop... on 05.05.17 at 6:45 pm

Just to compliment my b-grade post at #8 here is one of the other competitors that I was referring to.

These guys are on the hook for 5m and have had it down to 5.295 since November when they took a grater to the price and reduced it by 700k and now like the first guys are now stuck in limbo as they can’t go any lower without taking a big loss and they don’t even have a over inflated assessment to support their number.

Drop the pilot…

M42BC

https://vimeo.com/25551015

4765 PILOT HOUSE RD WEST VANCOUVER.

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAyOTFTRA==

https://www.zolo.ca/west-vancouver-real-estate/4765-pilot-house-road

#18 ZOLO on 05.05.17 at 6:46 pm

Is it just me or does everyone’s zolo account no longer show days on the market and price reductions?

It used to be visible when looking at the first picture – but it has disappeared…

Part of the RE industry’s efforts to hide information?

#19 I'm Not Poloz on 05.05.17 at 6:46 pm

50-cent Loonie is what Poloz is aiming for, not 73 cents. He thinks that even a 60c Loonie is too high because it will not boost exports and compete with Japan and Zimbabwe.

P.S.—I wouldn’t even want to live in Toronto or anywhere the TTC area touches, even if you paid me to live in Toronto. That city is a mess of SJWs and aristocratic smugness and snobbery. I’ve heard that it’s great to be a teenager in Toronto educational institution though…

Heard these teachers play fresh on the younger ones. These teachers dress more skimpy than an American Playboy model at those Summer camps, summer school and Toronto public swimming pool.

#20 Oncebittwiceshy on 05.05.17 at 6:50 pm

Exemptions: “100k reduction on a 4 million dollar home is chump change”

You’re missing the point, buds. The property was bought for 4.32 million. The seller can see that the market is diving but he doesn’t have the wiggle room to drop more.

Try myrealtycheck.com to see the average drop in price. It might be an eye opener.

Oh right, the B.C. market has been showing these price drops for several months now and as you stated the condo/townhouse market is on fire. Guess where those big drops are? Oops.

#21 Nonplused on 05.05.17 at 6:54 pm

Meanwhile Prime Minister Selfie is running around trying to start a trade war….

#22 Rexx Rock on 05.05.17 at 6:56 pm

Houses still selling like hotcakes in Victoria.Seems lots of Albertans moving to Victoria with the strong job growth.Langford is growing like crazy,I wonder if the local politicians will allow the clear cut of Goldstream Park?

#23 juno on 05.05.17 at 6:57 pm

hope they lower interest rates

Some loves to watch they loonie crash and burn.
Either way its a win win situation for me

Raise interest rates and crash the re-estate market. Lower interest rates and crash the loonie, making things more unaffordable for the poor.

#24 Ret on 05.05.17 at 7:02 pm

*Proximity To University Of Ontario Institute Of Technology* This is code for student housing!

Should be good for six students as it lists 4 bedrooms. Could be a good rental property if you can fix drywall and have a brother in law who works for a pest control company.

#25 Rainclouds on 05.05.17 at 7:03 pm

#12 Exemptions
“I know you are exited about a potential price decline, but maybe try again in a year or two”

I appreciate the effort and information Flop provides and I know many others do as well. Never got the sense Floppper was gleeful about price declines. My take is he is simply pointing out that there many folks who purchased in the past 2 years that will not recoup their investment.(or just barely) He is actually providing actual EXAMPLES of potential pitfalls. Something that real estate shills never do, Is that you by any chance?

#26 Blacksheep on 05.05.17 at 7:22 pm

“So the march to higher money costs in both countries is inevitable.”
————————————
Hold on partner…

I agree with you that the US rate will increase due to 2.5% wage growth applying pressure on the Fed.

The same rational applies Canada…

With the reporting of shite 0.7 wage growth, Poloz is under zero pressure to move up. So unless the employment sich in Canada improves significantly, Can rates are going nowhere (maybe down?) anytime soon.

The BoC is less important than the bond market. — Garth

#27 RentYVR on 05.05.17 at 7:25 pm

“Given four American rate bombs in 2017, with our loonie at 73 cents, it seems unlikely the Bank of Canada would risk cutting.”

Except for the fact that Poloz has repeatedly stated that he is looking to cut and that he obviously believes (incorrectly in my opinion) that a very weak loonie will bring about an economic renaissance in Canada.

His last hint was of a rate hike. Try to keep up. — Garth

#28 Smartalox on 05.05.17 at 7:27 pm

Meanwhile, in Vancouver’s Strathcona neighbourhood, speculators sit on properties. Or, possibly, let heritage-designated buildings succumb to ‘the elements’, so that any architectural features that the city might actually require a property owner to preserve as a part of any future redevelopment will rot and crumble into dust. I guess that if you can’t save the structure, you can redevelop it into ANYTHING!

http://www.cbc.ca/beta/news/canada/british-columbia/abandoned-and-flooding-vancouver-house-raises-fears-for-next-door-neighbour-1.4102010

Of course the neighbours in the neighbourhood might suffer some discomfort, but what the hell: some ReMax agent with a numbered holding company has an ‘investment plan’.

And if the neighbours don’t like it, they can sell their homes at a discount, for ‘land assembly’.

#29 SimplyPut7 on 05.05.17 at 7:34 pm

The speculators want out, I have never seen this many listings, for really great town homes, in Toronto and surrounding areas – empty, never lived in, modern appliances, large rooms and high ceilings.

I can see the layout and the way the building sits on the property. Why would I want an assignment for something that may not be as great as it looked on paper, at who knows what future interest rate, when there are so many great empty town homes available now?

And Oshawa is far, 90 minutes to two hours in traffic from home to downtown Toronto. No thank you.

Also home prices in general, are still way too high. I guess stubborn speculators are just going to have to wait until they hear stories about banks taking everything from some “investor” and foreclosing on their properties before they move on the prices.

I can wait. Their lenders may not be as patient.

#30 MORTGAGE FRAUD on 05.05.17 at 7:38 pm

Good read about mortgages in Canada
http://landlordrescue.ca/an-ode-to-marc-cohodes/

#31 Mark on 05.05.17 at 7:39 pm

“The BoC is less important than the bond market. — Garth”

I can see mortgage bonds selling off, especially if there’s any question of confidence in the CMHC and the Government’s willingness to shovel endless amounts of money into it as the Canadian RE market collapses. But GoC debt should continue to trade at very low yields as the result of significant demand for safety in light of collapsing RE.

If mortgage rates are heading higher, it won’t be because of rises in yields on GoC paper, it will be due to a higher cost of equity capital at the banks, increasing risk weights assigned by the OSFI which increases capital requirements for mortgages, and a decrease in the willingness of Canadian banks to fund an asset class that is now clearly in decline after the 2013 plateau.

With HCG most likely to disappear in the next few months, and probably out of the business of writing new mortgages at this point, competition in the RE mortgage market is disappearing. Expect the brokerages to be increasingly cut loose as banks move more business in-house and widen spreads applicable to retail RE mortgage-backed customers.

#32 Kilt on 05.05.17 at 7:46 pm

Canada won’t raise rates. Loonie is going to 50 cents.

Kilt

#33 Balmuto on 05.05.17 at 7:48 pm

Reality check for all you Ontario Liberal-bashers: if things are so bad here, why is the unemployment rate at a 16-year low? I’m no great fan of Wynne, just sayin’:

https://www.google.ca/amp/www.cbc.ca/amp/1.4101255

#34 TurnerNation on 05.05.17 at 7:51 pm

I hope everyone read Where’s the money Guido’s post late last blog. The take away for me is that all Crown Corps are the vehicles which fleece taxpayers.

Millennials: get a job in public sector; become a cop for a few years of pair overtime/paid duty; or join a Crown corp.
Capitalism is for squares.

Here in Kommunist Kanada we have planned production quotas, too. In the public sector of course:

http://www.theglobeandmail.com/news/politics/ottawa-to-pull-research-chair-funding-unless-diversity-issue-addressed-at-universities/article34905004/

“Ottawa to universities: Improve diversity or lose research chair funds”

“The federal granting councils that award the prestigious Canada Research Chairs say universities must offer up more diverse candidates for the honour or they will lose their funds.”

Yours, M41ON (not welcome in public sector)

#35 Jimbo on 05.05.17 at 7:53 pm

#13 Balmuto

Compared to the no house Annex lot, this one is a steal then.

https://www.realtor.ca/Residential/Single-Family/17985908/192-NEVILLE-PARK-Boulevard-Toronto-Ontario-M4E3P8-The-Beaches

#36 akashic record on 05.05.17 at 7:58 pm

Canadian real estate… such a no event.

In the light of the 9 GB email dump of hacked emails of the globalist groomed presidential candidate in France, a couple of days before the election, which he was supposed to not lose.

Everybody knows the scope of this game.

“Bet accordingly.”

#37 Blacksheep on 05.05.17 at 8:01 pm

This blog is often a battle of two agendas:

Group “A” for what ever reason, missed the run up in RE valuations and believes crashing the market is their ticket to RE ownership.

Group “B” was more fortunate and participated in the massive increase in home equity and are now eyeballing a healthier $ retirement.

I was in the “A” camp for 6 years until I realized that I was swimming upstream, fighting the system that:

1) Controls policy and can change it at any time.
2) Is catering to the 70%, that own RE and vote.
3) Is protecting the only significant economic driver left.

It’s obvious to all, I’m currently in the plan “B” camp and have been for 3 years. At least I’m not hiding my actual agenda like many others here….

#38 Trojan House on 05.05.17 at 8:02 pm

Majority of US jobs were in the leisure and hospitality industry – in other words, bartenders and waiters. Health services next – more sick people! And finally, in the show position, government jobs.

2.5% increase in wages offset by a 2.4% increase in the CPI.

Not such a rosy picture when you put it all in perspective.

#39 choptstix on 05.05.17 at 8:02 pm

http://vancouversun.com/opinion/columnists/douglas-todd-vancouver-is-a-money-laundering-haven

”Douglas Todd/Vancouver Sun:
Government must crack down on dark money to create housing affordability in Vancouver”

#40 MORTGAGE FRAUD on 05.05.17 at 8:03 pm

Mortgage fraud is out of control and CMHC plays a big part in this. Without mortgage fraud prices would be 50-60% less. The government does nothing but watches fraud happen out in the open. Canada is nothing but a fraud

#41 X on 05.05.17 at 8:07 pm

If the US Fed does 3 more quarter point raises this year, we won’t have a 73 cent dollar, unless the US economy puts a lot of upward pressure on oil, taking our dollar with it.

The more the US raises rates, we don’t have to cut ours, the spread is built it.

Eventually we will have to follow suit.

#42 jay on 05.05.17 at 8:20 pm

Justin and Christy are going to save Canada by putting duties on American products ,this is not going to work out well.https://www.bloomberg.com/news/articles/2017-05-05/trudeau-mulls-coal-ban-in-retaliation-for-u-s-lumber-tariffs

#43 Where's The Money Guido? on 05.05.17 at 8:57 pm

Addendum to # 213 Where’s The Money Guido? on 05.03.17 at 12:23 pm
Coming to a province near you: Credit Unions in BC, along with the BC gov’t, are changing their coverage of their accounts from $1 million to $100,000 in the guise to take their CUs across Canada and to limit their exposure to the fallout of the coming housing crash as they are dis-proportionally exposed to the mortgages.
With the change, they are also going to issue shares on stock exchanges and be bought and sold.
This has happened in Australia and has left its members without the say and share in the profits when they get sold (http://cufutures.ca/2017/04/10/coast-capital-sales-culture/).
Coast Capital is at the forefront of the rip-off of its members. and is having their Annual General Meeting today-the meeting is at 5 pm today (May 3rd), 2017 at Quilchena Golf & Country Club
3551 Granville Avenue Richmond, BC V7C 1C8.
If any of you are Coast members, I suggest you get to this meeting to question this rip-off.

Well, I had the pleasure of attending Coast Capital Credit Union’s (BC) Annual General Meeting to see how the vote was to take Coast Capital federal. What an eye opener!
Members supposedly voted 86.4% in favor!!!!!!!! I have to temper that with the fact that there wasn’t an independent auditor watching over the vote, just one of their Directors, hahaha.

Found out that Coast Capital hired ex-BC Hydro lawyer!! David Avren as General Counsel and Corporate Secretary, a couple months ago, just before Coast dreamed up this vote to take it federal. What a co-inky-dink, eh? They hired a guy who made legal compliance non-existent at BC Hydro from 2000 on, when the Lieberals first got elected in BC.
BC residents know all to well where BC Hydro has gone from then, with rates up exponentially and a debt north of $100 billion with future Independent Power Projects contracts included at ~$60 billion (buying it from IPPs at $100 per Mw/h, while selling it for $30/Mw/h on the market).
Since 2002 BC Hydro paid independent power producers $9 billion. Here’s the kicker: Once the contracts with BC Hydro expire, privately-owned IPPs wills be allowed free export of electricity on Hydro’s lines, which could negatively impair BC’s energy resources. They are also paying about $55-million a year to ensure emergency power is available if needed.

Another coincidence is most of these IPPs have former Liberal MLAs-Ministers and insiders at top positions in these companies. Hydro paid $672 million!!! over market price in 2015 alone (http://northerninsights.blogspot.ca/2016/02/ipp-paid-672-million-over-market-in-2015.html+ https://in-sights.ca/, https://www.biv.com/article/2017/3/bc-racks-58-billion-independent-power-producers-co/). BC Hydro themselves state they are losing $1.4 billion in IPP power because of overbuilding and oversupply.

Guess who was involved in the set-up of these deals since he has worked there since 2000, none other than Mr. Avren!

They also hired Bruce Schouten as Chief Risk Officer from OSFI (Office of the Superintendent of Financial Institutions) one of the completely useless orgs. that oversee banking in Canada, I’m guessing to “help” Mr. Avren keep Coast legally compliant by using/changing the rules to undermine policy, just like at BC Hydro.
And who do I see at the AGM but none other than Tamara Vrooman, who is CEO of Vancity CU and also former insider of former BC Premier Gordon Campbell (Greedo (Guido)-get the reference). I’ve never saw another CU’s CEO show up at any other AGM – really important for her to show up. I guess she’s there to make sure she gets the questions ahead of time when Vancity goes the same route (and of course report back to Guido Scambell and his bankster mafia).
It never ends…..

#44 WUL on 05.05.17 at 9:00 pm

Danny Downer chiming in here. Of late the pre-eminent jurists who show up here have been offering their advice to poor Derek and the unpleasantness he faces arising from his soured real estate transaction.

The Fort McMurray bar was summoned to a lunch hour session today with a Queen’s Bench Justice to hear about the lay of the land. It is a failing of the system bordering on a constitutional shortcoming. A denial of access to justice.

In Calgary if you are ready to proceed to a trial (so all pre-trial steps have been concluded – what, 18 months in?) you might get a trial date in October 2020.

Yes, 2020.

Derek Darling, Toronto may be very different but you might want to explore the great satisfaction that can be derived from 10 pin bowling and wake-boarding down the Don Valley Parkway.

#45 WUL on 05.05.17 at 9:02 pm

Meant to say for 5 days of trial time.

#46 Andrew Woburn on 05.05.17 at 9:03 pm

Demographics is destiny. Kids and condo’s don’t mix well.

– Millennials aren’t fleeing Vancouver but older siblings are. Census numbers suggest 30 and 40 somethings moving south of the Fraser

http://www.cbc.ca/news/canada/british-columbia/millennials-aren-t-fleeing-vancouver-but-older-siblings-are-1.4098269

#47 Nothing is selling on 05.05.17 at 9:15 pm

Rexx Rock on 05.05.17 at 6:56 pm
Houses still selling like hotcakes in Victoria.Seems lots of Albertans moving to Victoria with the strong job growth.Langford is growing like crazy,I wonder if the local politicians will allow the clear cut of Goldstream Park?

You realtor shills have no imagination. Very weak propaganda. Go finish high school while you wait for the market to true around. You have 5-10+ years to waste.

#48 Wrk.dover on 05.05.17 at 9:23 pm

Ponzi sleeper cell HCG

10/21/08 $7.82
08/08/14 $55.12

Someone is happy!

#49 YVR Update on 05.05.17 at 9:24 pm

Vancouver real estate about to rocket much higher after the BC Liberals win the election on May 9th.

It will be 20 years in power.

Foreign Buyers tax will be changed to allow loopholes galore.

Get your offers to purchase ready if I were you.

FOMO big time here next week.

#50 Hans on 05.05.17 at 9:25 pm

Is there a link for the Desjardins report?

#51 I know I know on 05.05.17 at 9:29 pm

“So the march to higher money costs in both countries is inevitable.” – Garth

——————————————-

Well, it’s been inevitable for many years. And what’s actually happened? Lower rates.

#52 WUL on 05.05.17 at 9:35 pm

JESS:

You comment here frequently and I hope you continue to do so. I read all of your comments. I do not open the links. I do not have to. Nothing surprises me about the depravity and sociopathic criminality of the corporate, banking, investment and multinational privateers that own us.

You trot out the dazzling amount of zeros attached to their fines and agreed upon settlements. Those are mere licensing fees paid to maintain membership in the club.

So, I hike, camp, fish, hunt, golf and ski to gain some solace and pleasure.

#53 The Well Hungarian on 05.05.17 at 9:54 pm

I’m not sure if even being balanced, diversified and liquid is gonna help once the down elevator button gets pushed and the slow descend begins.

It has in the past. Besides, the Canadian housing market will have zero impact on US or international markets, which outweigh Canadian growth assets two-to-one in a proper portfolio. Relax. — Garth

#54 Leo Trollstoy on 05.05.17 at 9:55 pm

#23 juno on 05.05.17 at 6:57 pm
hope they lower interest rates

Some loves to watch they loonie crash and burn.
Either way its a win win situation for me

I agree

#55 pete on 05.05.17 at 10:08 pm

It would not take a 13 year bear run to undo a 13 year bull run. Crash happens fast. 20+ years US housing bull run was ended with just 2 years, 2007 and 2008. The other theory is that the longer the bubble lasts, like this one in Canadian housing, the faster and more violent the crash would be.

so wait to see the freak show to start. won’t be boring and long, I promise.

It is a myth that a bubble only burst because of some outside events. Like a housing bubble could burst because interest rates rise or unemployment rises. A bubble, by definition, must burst. It will burst if it is pushed to the maximum with absolutely no outside prodding. A bubble burst under that circumstance will bring the most ugly consequences since it is a bubble inflated to the fullest.

like the current housing bubble in Canada. inflated to the fullest and will burst on its own.

#56 Entrepreneur on 05.05.17 at 10:14 pm

I feel for the youth that are entering the job market after graduating from school. Most of them have been taught well and to obey laws. What a sucker punch in the face when they step into the real crappy world of today. No, it is not about how to climb the ladder; it is who you know.

Watched the morning news, Stockwell Day was endorsing Kristy, the Liberals in the B.C. Wt… Stockwell Day is a Conservative and from Alberta. Talk about back scratching, bully pals in the making, Conservative and Liberals. Make sure you bunch the NDP down with those nasty remarks, give it up. They haven’t been in power here for a long time.

Obviously, it seems to me that Stockwell Day has invested interest to keep Kristy, Liberal in power. But isn’t the elections about the people?

TGF, and expect a picture or two of the blog meeting at GT store, I am jealous.

#57 paulo on 05.05.17 at 10:17 pm

looked at dasjardins report its a interesting piece, i think there estimates are somewhat below the mark, given the current “perfect storm of issues” that effect the cost of money and the soon to be seen move to iron clad governance by the big 5 in the way they grant mortgages look for federally mandated 3rd parties verification of income for mortgage applicants and renewals and the banks whom will dominate the industry seeking to improve there portfolio’s credit quality
i see first money mortgages @ 5% by the end of the first Q 2017 with compounded increases of at least 1% in each of the following five years meaning the cost of a first mortgage will not be lower than 9% in Q1 2021 in line with historical averages. possibility of higher money cost during this period very high chance of rate cuts Zero

#58 Jr on 05.05.17 at 10:22 pm

Garth,

Can you please link the Desjardin report that recommends that people budget a 5% rate if they plan to renew in 2 years.

I have some kinfolk I would like to show this to.

‘Preciate it,
JR

Here. — Garth

#59 JSS on 05.05.17 at 10:31 pm

Enbridge – another dividend increase – 5%
On top of the 10% announced earlier this year.

http://m.marketwired.com/press-release/enbridge-inc-announces-additional-quarterly-dividend-increase-tsx-enb-2214283.htm

Rub tummy.

#60 Dude on 05.05.17 at 10:42 pm

#18 Zolo

Dude, the days and reductions are still there.

Delete the app and download it again.

#61 Not an angry renter on 05.05.17 at 10:56 pm

-Loonie is dropping, Toronto prices looking even cheaper internationally

-More immigration, more home hungry people with money coming into Toronto

-Immigration won’t be ending anytime soon

After a short blip Toronto/Surrounding area is going to boom.

The real tip to learn is smart buyers are taking advantage of all the inventory now and buying to reap profits in 3-4 months.

Hate to spoil the Doomer party here.

#62 Tony on 05.05.17 at 11:04 pm

Hundreds of detached all brick bungalows on fifty plus foot lots with full basements were sold two years ago or less in Oshawa for right around the $250,000 mark. It takes a stroke of genius to pay $600,000 for a townhouse with condo fees in the same city today.

#63 Weekend at Bernie's on 05.05.17 at 11:06 pm

Those wannabe Forex traders on this blog chattering about a 50 cent loonie….Total b-llsh-t. Ain’t gonna happen boys. A 67 cent loonie is reasonable if you cowboys wanna place your shorts.

#64 Steve French on 05.05.17 at 11:23 pm

Smokey’s hitting the big time!!

Just remember on your way up the ladder of fame Smokey, to remember your 38 blog dog fans who you gave you your start.

I think it’s time to start monetising your blog fame Smoking Man… like those other GT proteges, the upstart kids over at “Millennial Revolution”.

Steve-O (The Dude)

#65 Mark on 05.05.17 at 11:28 pm

“Those wannabe Forex traders on this blog chattering about a 50 cent loonie….Total b-llsh-t. Ain’t gonna happen boys. A 67 cent loonie is reasonable if you cowboys wanna place your shorts.”

Going back to a dollar and beyond is far more likely than 50 cents, especially as RE deflation begins in earnest.

Imagine, if you will, how much Canadians will be saving, and not spending on imported stuff if they see their house prices cut in half or more? Massively deflationary and extremely supportive of the Canadian dollar.

#66 Long-Time Lurker on 05.06.17 at 12:00 am

#54 Pete

Bulls climb up the stairs. Bears fall out the window.

Some other than real estate news:

There was an assassination attempt on Kim Jong-Un by poisoning. (Associated Press) Red China has also cut ties with North Korea at least verbally. Methinks the clock is ticking for Kim.

Puerto Rico went bankrupt. (I forgot the source.)

The whole global economy has been in an economic slump for years now. If the Trump tax cuts actually revive the American economy then maybe the other countries will start following suit and the global economy will get going again. Zero-interest-rate-policy for close to a decade hasn’t gotten anyone anywhere and just created asset bubbles.

Leo Kolivakis pointed out that Red China is set for it’s own credit crisis.

A couple (3?) of hedge funds shut down this year. It’s difficult to make money in the current global scenario. (Various forgotten sources)

I read somewhere that U.S. insiders are selling their stock shares. (Unconfirmed source)

#67 paulo on 05.06.17 at 12:06 am

#60 you must be a realatard agent:

most immigrants arrive penniless and fulfill jobs that are below the locals IE minimum wage positions working for franchise fast food joints etc.
the real money players from mainland china and related have already figured out the easy money is gone and are looking elsewhere than Toronto or Canada, they did not acquire there wealth by playing into ponzi scheme real estate markets. the reality is that the gig is up for the real estate ponzi game,the heard is heading for the exit
and the mother of all corrections is in the first stage.this will be interesting to watch unless you where caught at the top and holding into the end game.

#68 Where's The Money Guido? on 05.06.17 at 12:10 am

Re:#16 SunShowers on 05.05.17 at 6:38 pm
Overall the country added just 3,200 positions, all government hires or people creating their own jobs (no benefits, no pension).

———————————————————-

Government hires are pretty much the only people who get pensions anymore.

Do you really think they are going to a pension?
Only the boys at the top are going to splurge, just ask Garth, get it while the gettins good

#69 meslippery on 05.06.17 at 12:10 am

Garth as a self-confessed numbers Guy how is it you
take(jobless rate at 4.4% considered to be full employment (and the lowest in ten years).
and think that is not wrong?
Sure thats the number getting UI but if UI runs out
and you still do not have a job then job or no job you
are still not employed…

#70 Where's The Money Guido? on 05.06.17 at 12:17 am

Re: #51 WUL on 05.05.17 at 9:35 pm
JESS:

You comment here frequently and I hope you continue to do so. I read all of your comments. I do not open the links. I do not have to. Nothing surprises me about the depravity and sociopathic criminality of the corporate, banking, investment and multinational privateers that own us.

You trot out the dazzling amount of zeros attached to their fines and agreed upon settlements. Those are mere licensing fees paid to maintain membership in the club.

So, I hike, camp, fish, hunt, golf and ski to gain some solace and pleasure.
I agree with your statement, but, WTF man, are you blind tyo wtf is up? Pretty soon that fish, hunt, golf,ski,. will nudge you out cuz you ain’t one of them.
Smarten the fuk up!!!!

#71 meslippery on 05.06.17 at 12:18 am

My last post was deep but what I meant to say was they
are counting UI collectors not the unemployed.Which may
be way higher.

#72 Smoking Man on 05.06.17 at 12:39 am

Was at the nephew stag tonight. Just got home. You have no idea what torcher it was watching the clock strike 9pm and I can’t have a drink. I’m the designated driver.

Anyway sitting at a table with old bulls. Real estate came up. Toronto is insane, we all won the lottery.

Keeped my mouth shut. If was drinking I would have educated them on the laws of supply and demand.

Last home to sell in Shlong branch was mine. Only because I took 150k discount from March comparable prices. 200k over november prices.

Happy buyer happy seller.

You need to sell. Jan prices. Next week you will need Dec prices with the amount of inventory coming on line.

#73 TLG on 05.06.17 at 12:56 am

Whatever u are smoking I want some.

#56 paulo on 05.05.17 at 10:17 pm
looked at dasjardins report its a interesting piece, i think there estimates are somewhat below the mark, given the current “perfect storm of issues” that effect the cost of money and the soon to be seen move to iron clad governance by the big 5 in the way they grant mortgages look for federally mandated 3rd parties verification of income for mortgage applicants and renewals and the banks whom will dominate the industry seeking to improve there portfolio’s credit quality
i see first money mortgages @ 5% by the end of the first Q 2017 with compounded increases of at least 1% in each of the following five years meaning the cost of a first mortgage will not be lower than 9% in Q1 2021 in line with historical averages. possibility of higher money cost during this period very high chance of rate cuts Zero

#74 For those about to flop... on 05.06.17 at 12:57 am

Since Broadway is on strike….this is a public announcement…

If anyone on the blog who has access to the database can tell me what these recent sales went for out in Surrey, so I can show the guys out that way what is going on I would appreciate it…

M42BC

8933 149 Street, Surrey.

9247 138 Street, Surrey.

13523 79 Avenue, Surrey.

#75 Mark on 05.06.17 at 12:58 am

“Well, I had the pleasure of attending Coast Capital Credit Union’s (BC) Annual General Meeting to see how the vote was to take Coast Capital federal. What an eye opener!”

So if the Coast Capital Credit union goes “federal”, does that subject them to the Bank Act? And shifts them to OSFI regulation?

I’m pretty sure that’s a much more difficult regime to work under than the “provincial” system.

I don’t know specifically what Coast Capital was writing, but it is well known that Vancity (another BC credit union) was writing some pretty crazy subprime loans that probably would not have been permitted of a federally regulated institution.

#76 april on 05.06.17 at 1:18 am

#48 – Another shill.

#77 steerage steward on 05.06.17 at 1:32 am

Sure Garth is the voice in the wilderness, not wrong except for the time line.

Perhaps it has come to the point that we should profit from others stupidity.

What’s the the short Garth?

#78 steerage steward on 05.06.17 at 1:34 am

Short Canada

#79 Ace Goodheart on 05.06.17 at 1:39 am

Never understood the obsession on here with grist. I mean a mill’s a mill right? You have to put something in it.

Friend has purchased a house with a partner. Nice area, close to transit. Bid highest, and they won. Idea is hold it for a year, and then sell for a profit. It would probably have worked out.

So I figure just find someone to lease it, try to find someone temporary. Hell Air b n b it for a year, probably make more.

What do they do? HELOC. On their house and the purchase. First class everything. Did you know you can pay $180 for a can of paint? I get mine for $40.00 and I figure I pay way too much? Why spend massive on a house you are going to sell?

The conclusion, when I try in vain to explain it is stupid to renovate a house, high end, that you don’t ever intend to live in, putting yourself in debt, second mortgaging your own house, HELOCing yourself into the poor house? Well I guess someone will get a really nice house! That is honestly what she said. And smiling, like she had accomplished something.

So if prices go up another 35% they will make money. I am told, they cannot sell now, or they will lose money.

What the *&^% are people thinking? This is not investing. This is not even speculation. This is like masturbation with a hole in the ground with bricks piled around it.

At any rate, the obsession with grist continues. Some people take it too seriously. Your civic duty is not renovating houses for people you don’t know, at great financial hardship for yourself.

Really people.

#80 oncebittwiceshy on 05.06.17 at 1:41 am

I Know I Know:
“Well, it’s been inevitable for many years. And what’s actually happened? Lower rates.”

Okay, let’s try this again. The Bank of Canada doesn’t have to raise interest rates for mortgage rates to go up.

Back in 2007/2008 hundreds of billions of dollars were driven into the Canadian Bond market, transacted by bond traders/vigilantes looking for a safe harbour… effectively driving Yield/interest rates/ down.

If you were to see a graph of these purchases, it would look like a hockey stick in comparison to the last 50 yrs.
Everyone now playing with that Monopoly money has benefited from this.

The Bank of Canada dropping their prime rate simply affected variable rate mortgages…. and the CDN dollar.

When these bond vigilantes see the opportunity for a better yield (U.S.A) they put pressure on Canadian bonds to increase their yield … thus increasing interest rates on the popular 5yr. mortgages.

If these traders bailed out of Canadian bonds in the same fashion that they came into the market you would see an increase in rates that would make 1981 look like a bump up.

So yes, the bond market is considerably more important and certainly bigger than the B.O.C.

36. Blacksheep
There is also option c) Those people that aren’t in either camp but have been through the Real Estate crashes of the early 80’s and 90’s. The kind of desperation, pain and family break up that ensues as a result of these bubbles popping is heart wrenching. Far too may people have got caught up in this one and I’m not looking forward to the deep recession and the pain that family and friends are going to endure.

Good luck to all, but I’ve been through it twice and it has never ended differently.

#81 LH on 05.06.17 at 1:49 am

In beautiful Omaha NE right now
God Bless the USA

#82 Dan.t on 05.06.17 at 2:24 am

#18 ZOLO
I noticed that as well. I get notifications and check out of curiosity certain markets. I always found days on the market was pretty helpful so of course they would discontinue that feature.

You wouldn’t want the buying public to know how long a house has been listed or previous purchase price or any other valid information that might actually help inform potential buyers. We wouldn’t want an informed public with accurate, up to date and easy to understand stats.

Real Estate industry can rob, steal, cheat, skirt rules, lie, screw over the public at will if they choose and zero enforcement…and if and when they get caught, a simple slap on the wrist and it goes on…and NO I believe most are honest and trustworthy but look what is going on in YVR, GTA, shadow flipping, pressure tactics, fraud and so on.. so it seems if you are not participating, you’re probably of the thousands of realtors not eating.

Again, what other industry operates this way in Canada?

Home buyers are about to make the biggest purchase of their lives and they can’t get accurate and up to date information to do their due diligence, of course most don’t seem to want to anyhow…just buy a condo, sight unseen, flip it for a few hundred k, easy- if it goes sour blame someone else.

Every other industry is regulated and enforced excessively and yet, all bet are off with realtors and the industry. Probably because it’s been pushed so hard by government and is the biggest industry/business in Canada. Canadians selling houses to Canadians….seems sustainable. Just leave it alone. Move along. Nothing to see here. Prices go up forever.

I bet a large part of the affordability crisis is due to realtors hording properties, directly or indirectly. I guess we will never know since all stats are smoothed, padded, reworked and the only data consumers get is what real estate board wants you to get.

#83 Dan.t on 05.06.17 at 3:14 am

Oops, just got notification from Zolo, days on market are there…oh well, still think a lot of shady business is going on with real estate in Canada.

If your going to turn housing into a commodity to be sold as a future contract, flipped, traded, whatever, then regulated it as such.

Open and accurate information for all parties…not just those in the business and with insider information.

#84 fishman on 05.06.17 at 3:16 am

If watching Kesler & co. made you want to shoot some heroin? its OK. The Feds just passed a Sanctuary Law for those that phone in to report opiate derivative overdoses . If you start to go under there’s an antidote if delivered on time. Your buddies or old lady will have to come through?

Things have changed in the last 30 years. I was sleeping on the boat when another fisherman got me up early. “I need some help”. Walking down the dock he told me he thought his deckhand was dead & wanted me to double check. This wasn’t too out of line since they both were hardcore junkies. The guy was slumped over at the galley table & sure enough dead. “What do we do? What do we do?”. Phone the cops. We jumped off & headed up the wharf because in those days you went to the pay phone at the head of the dock. “Just a minute ” he says & jumps back aboard. I peered in the window & he was going through the dead guys pockets. Stone cold, stone cold.
I’d rather be licking ice-cream at the General Store with the boys. Cool Vanilla’s my flavour.

#85 TRUMP on 05.06.17 at 3:18 am

BUY A STRIP CLUB

Best investment I ever made.

#86 Smartalox on 05.06.17 at 3:26 am

I was searching for a BC Liberal Attack Ad to show to my wife, and while searching YouTube, I found this video instead, posted the the United Steel Workers, from their 2014 annual convention. Note that Horgan was already leader of the NDP at the time.

https://m.youtube.com/watch?v=q01qMenQ2mM

In his speech, Horgan invites his ‘brothers and sisters’ in the Union elite to view his ‘workplace’ – the BC legislature – and invites them to come visit, to spend their money in BC.

He’s NOT asking for their support for BC, its resource industry, or its union workers; he does (as always) blame ‘the Government’ for the province’s woes, notably for the failure of a mine tailings dam, that was in the news at the time. No mention of the Union workers at the company, or who live in the region, that may have been affected.

Apparently in a different video of the same event, Horgan walks out on stage to the tune of Bruce Springsteen’s hit ‘Born to Run’. I kid you not.

Lyrics:

‘By day we sweat, out on the streets of a RUNAWAY AMERICAN DREAM,
At night we ride to ‘mansions of glory’ in suicide machines!’

If you see that picture of the BC Legislature used as a backdrop to Horgan’s speech in the video, it’s all lit up, like a ‘mansion of glory’.

Horgan is BOUGHT and PAID for by the United Steel Workers, period. A strong economy in BC costs US workers, and they can’t have that, down at USW Headquarters.

#87 Tom from Mississauga on 05.06.17 at 4:11 am

So if wages aren’t going up but minimum wages are…what gives?

#88 Unsunghero on 05.06.17 at 4:51 am

Big whoop! Average sfd house prices have gone from around $300k to over $1 million in the last 15 years. Now if we get a crash, they might drop to $900k. So after a crash housing will still have tripled, anyone who bought will still have made out like bandits, and housing will never be reasonably priced again. Guess what when you import 100,000+ people a year to your region real estate prices and rents skyrocket! It’s basic supply and demand.

#89 Darryl on 05.06.17 at 4:56 am

Looking at the blue dots on MLS.ca.
Unbelievable how many more that last month .

Just for kicks I clicked on the open house only box . There seemed to be as many little blue dots for open houses only this weekend as there were in total last month on any given day.

#90 willworkforpickles on 05.06.17 at 4:56 am

Like i said here on this message forum 3 years ago, speckers will lead the rush out of a bloated real estate market here in panic mode .
Hasn’t happened yet. It will.
What me worry you say. Why bother. Its all good for now…
….while there’s still food.

#91 Stan Broock on 05.06.17 at 6:02 am

Canada is 2.5 % of the world economy at it’s peak at the moment due to the debt bomb and declining.

The only reason to have some Canadian stocks in a TFSA account is the preferred treatment of dividends, soon to be diminished by policies.

A good performing portfolio will have equal weight of US and European ETFs (at probably 25-30 % each), some solid chunk in China and ’emerging’ markets (up to 25-30%) and maybe 15-20 % high quality corporate debt/bonds ETF.

No government bonds whatsoever.

Some of the emerging markets have already far superior and more competitive economies than the Canadian economy despite all the natural resources that Canada has.

It takes exceptional ‘creativity’ and shortsighted-ness to destroy all the economic advantages that Canada had and has – resources, land, proximity to the world # 1 economy – the US, huge advantage in trade with it, influx of educated immigrants in order to convert it to an inefficient economy based on cheap labour, highly in-competitive and non-productive, overwhelmed with debt.

But this is what you get when you allow the cancer – the financial sector to take over. ‘Affordable’ houses of 1.5 mil for people with income of 75 k (gross family) in a country with unlimited resources and space.

CAD dollar rates will not go up significantly. They can’t due to debt.
BOC will become single buyer of bonds in order to suppress rates further and maintain them at low levels.

If this coincides with a potential trade war with the US and further commodities decline it will cause disastrous and destructive inflationary depression.

The mildest outcome will be 2-3 decades of inflationary stagnation but I doubt the geniuses in charge of the economy have the mental capacity to orchestrate such relatively soft landing.

In all cases the economy is doomed mid to long term with Canada becoming very bad place for the young generation. If we factor in the automation, the disappearance and offshoring of jobs, people with kids would be insanely irresponsible (to their kids) not to move away immediately or in very near future along with their assets, while they still can.

#92 Stan Broock on 05.06.17 at 6:25 am

#62 Weekend at Bernie’s on 05.05.17 at 11:06 pm
Those wannabe Forex traders on this blog chattering about a 50 cent loonie….Total b-llsh-t. Ain’t gonna happen boys. A 67 cent loonie is reasonable if you cowboys wanna place your shorts.
—————–

An aide to the financial minister said 62 cents in 2018.
Which means almost certainly no rate increases whatsoever, even further reduction (in case of recession) and with almost absolute certainty CADa in the zero – point- fifties range (0.5x) next year.

We are still at leveraging phase while US ended up leveraging first, then deleveraging and is growing again. the tales of the 2 connected economies with completely different economic cycles.

One way or another that connectivity will be broken as it can not be maintained artificially at the expense of ever- cheaper currency. US will retaliate in a big way and our economy will be completely and utterly destroyed (or at least whatever is left of it in the resource and services sector). Another Mexico north of the border is not an unexpected outcome.

#93 SimplyPut7 on 05.06.17 at 6:28 am

#60 Not an angry renter on 05.05.17 at 10:56 pm

A few points:

1. Wealthy people and poor people have one thing in common, we don’t like to overpay for anything, if we think something is going to keep going down in value e.g. property, we will wait for it to hit a floor value and not try to catch a falling knife.

2. As a born and raised Canadian, who has immigrant parents and friends of many first and second generation Canadians, I will let you in on a little secret: Canada is NOT, the first choice of immigrants when planning to leave their country. Canada is seen as boring.

We don’t provide the same opportunities as the US e.g. they make more money, usually have a very high currency meaning your money will go farther in your birth country or abroad than it would if you were holding the falling Canadian loonie and the US provides easier access to better quality homes that are more affordable than Canada – have you seen the crap the smug media in Toronto proudly show as sold over asking? We also don’t have the same prestige as the UK. Many immigrants are a by-product of colonialism, the Queen and the UK in general are seen as more desirable than Canada.

The main reason why people end up in Canada and stay is because the US and UK said they have to wait a bit longer to get into their country and people end up staying longer (or forever) unintentionally; or they have family who are already here and have told them to come to Canada. Toronto is not New York or London, I was at a seminar the other day and with many foreigners (US, Mexico and Europe) and the general consensus of Toronto was we’re not quite Chicago and not quite San Francisco.

3. Toronto and surrounding areas have been booming, but for all the wrong reasons, the areas are littered with empty homes, many cities (*cough* Milton, Brampton) were not well built and lack the universities, colleges, hospitals and transit to support their growing city. Local Canadian speculators bought many homes in these cities hoping the price will continue to go up. Some streets in the GTA have 3 or 4 new vacant homes up for sale within a block of each other, and families with older homes who were hoping to cash out have to compete with speculators who watched way too much HGTV and have flawless homes that have not had any offers and been on the market for a few weeks – and I’m not talking about shoe box condos either, detached houses and town homes, no offers and vacant.

Our media may have tried to bury the stories about the syndicated mortgages, home capital group and liar loans but the articles outside of Canada have made it clear they know something is wrong with Canada’s housing market and they are watching to see what happens next.

https://www.bloomberg.com/news/articles/2017-05-02/-boring-canada-gripped-by-crisis-concern-on-home-capital-spiral

#94 Even More of Trump's Idiocy on 05.06.17 at 7:00 am

… Trump told [Malcolm] Turnbull: “We have a failing healthcare. I shouldn’t say this to our great gentleman and my friend from Australia, because you have better healthcare than we do.”

Opponents pounced with relish. Senator Bernie Sanders, a … champion of single-payer systems, tweeted: “Thank you Mr. Trump for admitting that universal healthcare is the better way to go. I’ll be sure to quote you on the floor of the Senate.”

https://www.theguardian.com/us-news/2017/may/05/trump-healthcare-australia-better-malcolm-turnbull

Dickerson: George W. Bush said the reason the Oval Office is round is there are no corners you can hide in.

Trump: Well, there’s truth to that. There is truth to that. There are certainly no corners. And you look, there’s a certain openness. But there’s nobody out there. You know, there is an openness, but I’ve never seen anybody out there actually, as you could imagine.

Dickerson: But he—what he meant was it’s—all comes—

Trump: Sure. Sure.

Dickerson: —back to you.

[Well, at least Trump knows his shapes! When George W. Bush is capable of saying something so deep that it goes right over Trump’s head, it should give everyone pause.]

http://www.cbsnews.com/news/president-trump-oval-office-interview-cbs-this-morning-full-transcript/

Are You Smarter Than the President? Take This Quiz and Find Out!

http://www.alternet.org/election-2016/are-you-smarter-president-take-quiz-and-find-out

#95 maxx on 05.06.17 at 7:56 am

#17 For those about to flop… on 05.05.17 at 6:45 pm

“These guys are on the hook for 5m and have had it down to 5.295 since November when they took a grater to the price and reduced it by 700k and now like the first guys are now stuck in limbo as they can’t go any lower without taking a big loss and they don’t even have a over inflated assessment to support their number.”

It never ceases to amaze me that there are so many idiotic sellers who expect that the next buyer will somehow COVER their “expenses” and/or “losses”. Realtards often bray: “they paid X and won’t go any lower” or, “they’ll be losing money”, “they’ll never let it go for less”, followed by a knowing look.

….and so many fools bought it, wholesale.

Stupid buyers who actually believe that particular price support also believe that realtards are their friends.

The very thought of funding some greedy fool’s luxe retirement or fiscal well-being by overspending is absolutely and completely insupportable.

These rapacious twits can choke on their “investment” mistakes.

It’s high time, no way past the time for market forces to share the helm with tptb.

#96 pete on 05.06.17 at 8:31 am

#60 Not an angry renter on 05.05.17 at 10:56 pm
-Loonie is dropping, Toronto prices looking even cheaper internationally

-More immigration, more home hungry people with money coming into Toronto

It is laughable how people are touting “immigration” will drive up Toronto housing. Yes, there are 300k people coming to Canada each year. but there are many k people leaving too. Net immigration is not that high.

besides, there are more than 250k coming to Canada each year in the 1990s. why did Toronto housing price stay down for most of the 1990s?

Immigrants mostly come from less developed countries in the world. You think they have more money to buy the inflated houses than you ‘born and raised’ Canadians?

#97 mouldyinyvr on 05.06.17 at 8:33 am

http://vancouversun.com/news/local-news/house-buyer-beware-landmark-b-c-court-ruling-will-shake-real-estate-industry

Let’s hope this ruling sticks…..not holding my breath.

#98 economictsunami on 05.06.17 at 8:43 am

Rate hikes by the Fed signal…?

A red hot economy that needs to be cooled down?

What we have here is mature debt/ economic driven cycles, and after having rates that were too low, for too long, pretty much everyone that can become a debt slave has already done so.

Now with the ball attempted at being handed off, from some (not all) central banks to government’s (and not the private sector) will they be able to spend us to glorious prosperity?…

Debt levels are now back where they were when Jim Cramer had his prophetic TV meltdown 10 years ago:

http://www.businessinsider.com/debt-credit-npl-10-anniversary-jim-cramer-cnbc-meltdown-2017-4?&platform=bi-androidapp

Government life support is the only thing stopping the economy from sliding into another Great Depression

http://www.scmp.com/business/global-economy/article/2090041/government-life-support-only-thing-stopping-economy-sliding

#99 update on 05.06.17 at 8:48 am

Close friends in GTA considered listing last year, realtor surprised them saying they could get $1.6m, they had thought maybe $1.2m.

So they plowed ahead with some bed and bath renos and some landscaping, and a couple hundred g’s later they are ready to list for real.

Realtor now says $2.1 to $2.3m. I think they could have sold for $2.5m in March, easily, judging by what other places sold for. This place is done to a high standard (Like built in Miele coffee maker, wine cellar, the obligatory steam oven, $12,000 fridge etc.)

Should hit MLS this week. Staging being done now. Will be interesting.

Early retirement or no?

#100 pathetic fallacy on 05.06.17 at 8:57 am

Apt weather in GTA for a real estate downturn.
Some may end up underwater, figuratively, not to mock those literally under water.

#101 MF on 05.06.17 at 9:10 am

#92 SimplyPut7 on 05.06.17 at 6:28 am

Not exactly.

I was born and raised in the gta, and am close friends with tons of immigrants. My thoughts are you are incorrect.

It’s true the gta housing markyis an unmitigated disaste…but:

-You totally missed the main draw: acceptance. Canada is also seen as accepting to immigrants, particularly those fleeing tribalism. This is a unique quality.
-Boring is actually what people want, especially families that want to raise kids.
-if someone does choose Canada, to the gta they go.
-there are lots of other benefits new immigrants enjoy (child tax benefits etc.)
-London (although Brexit will hold it off for a bit) is in a declining zone. The eurozone and surrounding areas have no future.
-New york has all the problems that a major city has and that toronto has less of right now (income disparity, crime, racial tension etc.)
-some see toronto as an early version of these cities and therefore want to get in while prices are somewhat affordable (compared to new york or london)
-most of the western world is experiencing this housing disaster. It’s part globalism but also a failure of central bank policy that depends on low rates and debt expansion to continue.

MF

#102 NoName on 05.06.17 at 9:16 am

#15 traderJim on 05.05.17 at 6:36 pm

I’ll even be blasphemous and suggest a young person building a portfolio could and should have a 100% US equity portfolio.

—-

to some degree I agree with 100%, if growth is only goal, but i would not keep all in us, only. Few years back japan was on fire while spy was just chugging along. anyways long story short nikkei last 5yrs 120%, snp500 80%. imagine some japanese didde saying s same thing 100% in nikkei, i bet you he was popping Alka-Seltzer deily.

http://www.marketwatch.com/story/millennials-ought-to-be-100-invested-in-stocks-says-top-ranking-newsletter-editor-2017-05-03

#103 MF on 05.06.17 at 9:46 am

#87 Unsunghero on 05.06.17 at 4:51 am

-Houses correcting to 900K would mean the down payments of almost all first time buyers and those with massive leverage (almost everyone else) will vaporize.

-Throughout the last 15 years you cannot just ignore maintenance costs, property tax, utilities etc.

-A correction to 900 k would shatter the “idea” that housing only goes up, slowing demand and increasing supply as everyone who bought in 2005 tries to cash in (but won’t be able to).

-The massive portion of the economy that depends on real estate (slime realtors, mortgage brokers, developers) would suffer……lessening demand even more.

MF

#104 Smoking Man on 05.06.17 at 9:51 am

Herdonomics 101

https://trends.google.ca/trends/explore?date=all&q=TORONTO%20REAL%20ESTATE%20CRASH

#105 traderJim on 05.06.17 at 10:02 am

#101 NoName

“Few years back japan was on fire while spy was just chugging along.”

Assuming you or anyone can tell which markets will outperform for which periods, then of course you should jump from one to another at exactly the right time.

But we all know that timing is impossible.

Diversification is for people who can’t stand any volatility. (To each his own, just don’t complain about average returns)

I think most people make it far too complicated.

The US is the biggest economy, with one of the better economic systems, and the longest track record of great performance.

Warren Buffett rarely strays from it, with good reason.

Canada is a miniscule player on the world scene, and you would be crazy to limit yourself to the Canadian market.

KISS

#106 Doug in London on 05.06.17 at 10:07 am

@Blacksheep, post #36:
A lot of us here, like myself, are in neither group A or B. I have no desire to buy a house and the only real estate I own is in REITs, some of which I scooped up when they were on sale in 2013. So why do I follow this blog? I’ve been following this blog for 7 years now, and have learned a lot. What I’ve learned here has helped my investment portfolio grow and perform much better. Keep in mind I failed a college financial course, so I had and still have a lot to learn about investing.

I’m 56 years old and have seen other bubbles come and go, including in real estate. I believe we are in a bubble now, especially in Toronto and Vancouver. When (not if) it corrects, there will be winners and losers in the fallout. In this fallout, there are bound to be good buying opportunities for some assets (other than real estate itself) as there always are when a crisis occurs. As Warren Buffet said, never let a good crisis go to waste. I’m getting ready, is anyone else?

#107 IHCTD9 on 05.06.17 at 10:16 am

#86 Tom from Mississauga on 05.06.17 at 4:11 am
So if wages aren’t going up but minimum wages are…what gives?
—-

Won’t be long before they are one and the same.

“The wage”.

I read an article not long back that stated largest y/y wage gains in Ontario were minimum wage earners after it went to $11.40.

Kids are loving it though. Today, a good used car costs about the same or less than it did when kids made 3.25/hr flipping Big Macs. 20 somethings now all drive lifted 4×4 trucks getting 10 mpg.

#108 SimplyPut7 on 05.06.17 at 10:27 am

#100 MF on 05.06.17 at 9:10 am

I think: #95 pete on 05.06.17 at 8:31

Did a better job than me at explaining my point, there’s nothing new about Canada, nations around the world are struggling to get back on their feet from some really bad recessions and wars, but the problems around the world is nothing we haven’t seen before; social media is just better at bringing them to the forefront more quickly.

As soon as things get better politically and economically in these nations, Canada will not be the safe haven for immigrants and foreign money people think it is. They will go back to their usual first choice destinations, especially if our housing market and economy continues to unravel at its current speed.

#109 Wow explosive G&M condo flipping article today on 05.06.17 at 10:29 am

http://www.theglobeandmail.com/news/toronto/condo-flipping-toronto-hot-housing-market/article34908345/

#110 NEVER GIVE UP on 05.06.17 at 10:30 am

#36 Blacksheep on 05.05.17 at 8:01 pm
This blog is often a battle of two agendas:

Group “A” for what ever reason, missed the run up in RE valuations and believes crashing the market is their ticket to RE ownership.

Group “B” was more fortunate and participated in the massive increase in home equity and are now eyeballing a healthier $ retirement.

I was in the “A” camp for 6 years until I realized that I was swimming upstream, fighting the system that:

1) Controls policy and can change it at any time.
2) Is catering to the 70%, that own RE and vote.
3) Is protecting the only significant economic driver left.

It’s obvious to all, I’m currently in the plan “B” camp and have been for 3 years. At least I’m not hiding my actual agenda like many others here….
====================================

Well said Blacksheep!

But the root cause is far larger. Interest rates loom large and are likely to never return to normal. Never say Never but Interest rates world wide have been falling steadily for 40 years.

I have no idea what force could reverse this trend.

All the extra Fiat money created from loans through banking and fake insurance schemes like the CMHC (Which is merely a confidence scam) is percolating to real estate that is inflating at a much different rate than our economy.

Those who were wise enough (mostly lucky enough) to be holders of real estate during the run up have made out like bandits. Many of whom think they are very smart investors!

#111 traderJim on 05.06.17 at 10:33 am

There is some truth to Mark’s claim that deflation tends to cause a currency to rise in value, just as inflation-which means inflating the supply of money and credit-is just another way of describing the devaluation of currency.

But the relationship is not perfectly correlated. And a housing bubble bursting is not equivalent to an entire economy deflating (although it could lead to that, as in Japan).

After the Japanese property (and stock mkt) bubbles burst in mid 1990, the yen at first dramatically fell, and only later began a decades long increase in value. (Roughly from 150 Yen to the dollar to 100 Yen/dollar, with lots of ups and downs along the way).

Eventually I could see the loonie back up close to par, or above 90 cents anyway. But that will happen over 5 to 10 years.

I think we’ll visit 69 cents first.

#112 dr. talc on 05.06.17 at 10:37 am

if the politicians wanted to slow the market all they had to do was put hst on resale, they didn’t
= they know it will self correct as markets do
plus they get to blame others for the mess created by themselves and the banking ‘system’
= foreigners get the blame
how much will they collect in foreign buyers tax?
close to zero
the politicians think voters will believe anything

#113 MF on 05.06.17 at 10:52 am

#107 SimplyPut7 on 05.06.17 at 10:27 am

Still disagree.

Most countries on the earth are extremely corrupt. Some more than others obviously. The mentality is if you do not have wealth you are worthless. This is not how we Canadians view the world, and therefore new immigrants often feel “welcome”.

Canada is not immune, but the levels of corruption are less, and the disconnect between the classes is less too.

MF

#114 Gentle ,Loving Kindness on 05.06.17 at 10:53 am

If the Provincial & Federal Governments were truly concerned about the Canadian re estate situation, and were truly concerned about Canadians, why wouldn’t they legislate a requirement for the transparency of data and information about re estate?

#115 Dominoes Lining Up on 05.06.17 at 10:55 am

I was speaking about the collapse of urban and mall retailing a few days ago. Now this:

https://www.thestar.com/business/2017/05/06/how-neighbourhood-malls-are-struggling-to-survive.html

416 and 905 malls are under serious threat. One mall manager here bravely says it’s okay that her mall has lost a 70,000 sq. foot major food store, since they have a new tenant, a 20,000 sq foot ‘Planet Fitness’ franchise.

Planet Fitness offers no commitment, $10 monthly memberships and ‘no judgment’. The outlets I have seen in second tier malls are almost always nearly empty. How is this a successful business model for the property owners? They’re basically a bandaid, making empty space seem like it is being used, tenants paying vastly reduced rents with no long term commitment.

Besides, anyone noticed that Canadians are increasingly obese and don’t/aren’t able to give a crap about it? (Obesity is largely linked to poverty, by the way, another sign of our spiral to the bottom)

This is looking kind of spooky. Retail employs a lot of people, albeit poorly. Add those potential job losses to the horrible job numbers this week and the spike in millennials and other who lack any hope of propping up our real estate bubble and………

A huge domino that will fall, in parallel to the coming real estate meltdown, making it way worse.

A housing correction of anywhere from 40-80% is not too far off for the GTA, I think.

This looks like where Canadian retail, especially in the 905 wastelands, is headed:

https://www.vice.com/en_ca/topic/abandoned

#116 maxx on 05.06.17 at 10:56 am

#36 Blacksheep on 05.05.17 at 8:01 pm

“This blog is often a battle of two agendas:

Group “A” for what ever reason, missed the run up in RE valuations and believes crashing the market is their ticket to RE ownership.

Group “B” was more fortunate and participated in the massive increase in home equity and are now eyeballing a healthier $ retirement.”

You forgot the third: The “C” for cash Camp. Those who sold at the top and crystallized their profit. They are now living that coveted life and needn’t worry about market tops, what the policy wonks are up to, etc.

RE is not king, cash is king and always will be.

#117 well there you go on 05.06.17 at 11:10 am

‘As Warren Buffet said, never let a good crisis go to waste. I’m getting ready, is anyone else?’

……..

price for a toronto detached is about $1.5 million. A ‘correction’ may get ya to $1 mill

go ahead and buy it…

ship has sailed for Toronto and Vancouver real estate

#118 Stunning G&M condo flipper article on 05.06.17 at 11:15 am

Wow, hello CRA! check those previous owners out!

http://www.theglobeandmail.com/news/toronto/condo-flipping-toronto-hot-housing-market/article34908345/

#119 Con Fuscious on 05.06.17 at 11:23 am

“As soon as things get better politically and economically in these nations, Canada will not be the safe haven for immigrants and foreign money people think it is.”

Sure, we all hope all wars will end, but problems in the world won’t end with that. You obviously don’t understand the challenges most developing countries face – environmental, social, political – that won’t be solved anytime soon, so Canada will still be attractive, for young professionals especially.

There may be more attractive places to retire, even in the developing countries – if you have lots of money – but not necessarily to build a career and raise and educate your children.

#120 Damifino on 05.06.17 at 11:26 am

#108 NEVER GIVE UP

This blog is often a battle of two agendas:

Group “A” for what ever reason, missed the run up in RE valuations and believes crashing the market is their ticket to RE ownership.

Group “B” was more fortunate and participated in the massive increase in home equity and are now eyeballing a healthier $ retirement.
——————————————-

You missed a couple…

Group “C” who have already cashed out with $1.5M or more, in globally diversified investments, regularly balanced and spinning off an average 6% annually.

They rent high end, professionally managed accommodation and no longer spend their weekends worrying about the next lump of cash to be extracted by the time sucking money-sinks they once called home. Their agenda is to encourage others in the same position to do likewise while they still can.

Group “D” are those born to late to be in Groups “A”, “B”, or “C”. They need to learn how to save and invest in the new world order that lies before them.

Unfortunately, they’ll need to get rich slowly. Much dedication and careful wealth management lies ahead. Hopefully, they’re still young enough and tough enough to get with the program.

Sorry about all that, but it wasn’t my generation’s fault. At least we finally got rid of polio, smallpox and the Ed Sullivan Show.

#121 doom and gloomers on 05.06.17 at 11:27 am

-London (although Brexit will hold it off for a bit) is in a declining zone. The eurozone and surrounding areas have no future.

…………

lol

why does this blog, like a magnet, attract so many ?

odd

#122 CL on 05.06.17 at 11:30 am

“#18 ZOLO on 05.05.17 at 6:46 pm
Is it just me or does everyone’s zolo account no longer show days on the market and price reductions?

It used to be visible when looking at the first picture – but it has disappeared…

Part of the RE industry’s efforts to hide information?”
=================================

Banks have done things like this in past as well. As an example, CAD banks used to have mortgage calculators that would show the total interest paid on a mortgage you were calculating using their site. Then all of a sudden, literally, this was gone from all of the banks sites. You could no longer view the total interest cost of the mortgage. The total interest costs were available on banks websites for years as I used to use them all the time and review total interest costs. But it was all of a sudden in 2008 or early 2009 (the date seems oddly coincidental with lowering interest rates) these views for total interest paid were no longer available.

It was not only me who noticed this but others I knew did as well. Subtleties to aid agendas in our society today are much more prevalent than ever before in everything. The funny thing is, it works on most people.

#123 Leo Kolivakis on 05.06.17 at 11:34 am

“At the same time, there’s a 90% probability US interest rates will rise again next month since their labour stats are positively Kardashian. Another 211,000 new positions in April, with the jobless rate at 4.4% considered to be full employment (and the lowest in ten years). Average wages increased 2.5% – or three-and-a-half times more than in Canada. So it’s a slam dunk the Fed will hike in June, then again once or twice before the end of the year.”

I disagree. Employment is a coincident, not leading economic indicator. If you look at leading indicators, the US economy is slowing. Latest employment report will give the Fed wiggle room to raise one more time this year. It needs to raise to store up ammunition for cutting rates during the next crisis, which is coming sooner than we think.

I keep saying this, debt deflation, not inflation, is what’s ailing the global economy. Rising unemployment, not rising rates, will ultimately kill the Canadian red hot real estate market.

For all of you who think the Fed will raise rates three or four times this year, forcing the Bank of Canada to follow, you might be deeply disappointed.

Disagree all you want. The Fed will raise in June, and again at least once in 2017. The BoC will follow in 2018. — Garth

#124 DON on 05.06.17 at 11:35 am

#108 NEVER GIVE UP on 05.06.17 at 10:30 am

#36 Blacksheep on 05.05.17 at 8:01 pm
This blog is often a battle of two agendas:

Group “A” for what ever reason, missed the run up in RE valuations and believes crashing the market is their ticket to RE ownership.

Group “B” was more fortunate and participated in the massive increase in home equity and are now eyeballing a healthier $ retirement.

I was in the “A” camp for 6 years until I realized that I was swimming upstream, fighting the system that:

1) Controls policy and can change it at any time.
2) Is catering to the 70%, that own RE and vote.
3) Is protecting the only significant economic driver left.

It’s obvious to all, I’m currently in the plan “B” camp and have been for 3 years. At least I’m not hiding my actual agenda like many others here….
====================================

Well said Blacksheep!

But the root cause is far larger. Interest rates loom large and are likely to never return to normal. Never say Never but Interest rates world wide have been falling steadily for 40 years.

I have no idea what force could reverse this trend.

All the extra Fiat money created from loans through banking and fake insurance schemes like the CMHC (Which is merely a confidence scam) is percolating to real estate that is inflating at a much different rate than our economy.

Those who were wise enough (mostly lucky enough) to be holders of real estate during the run up have made out like bandits. Many of whom think they are very smart investors!
**********************

“I have no idea what force could reverse this trend.”

So…because you can’t envision it…it won’t happen?

For the last couple of years the topic of subprime mortgages in Canada was being debated and because people couldn’t see it…it wasn’t gonna happen. Well it happened!

When people lending money for mortgages (bond market) wants higher returns they will start asking.

Just because no one sent you the memo…you don’t think this gas bag is troubling. Either two young and believe in recency or too old and memory loss.

#125 DON on 05.06.17 at 11:46 am

#85 Smartalox on 05.06.17 at 3:26 am

I was searching for a BC Liberal Attack Ad to show to my wife, and while searching YouTube, I found this video instead, posted the the United Steel Workers, from their 2014 annual convention. Note that Horgan was already leader of the NDP at the time.

https://m.youtube.com/watch?v=q01qMenQ2mM

In his speech, Horgan invites his ‘brothers and sisters’ in the Union elite to view his ‘workplace’ – the BC legislature – and invites them to come visit, to spend their money in BC.

He’s NOT asking for their support for BC, its resource industry, or its union workers; he does (as always) blame ‘the Government’ for the province’s woes, notably for the failure of a mine tailings dam, that was in the news at the time. No mention of the Union workers at the company, or who live in the region, that may have been affected.

Apparently in a different video of the same event, Horgan walks out on stage to the tune of Bruce Springsteen’s hit ‘Born to Run’. I kid you not.

Lyrics:

‘By day we sweat, out on the streets of a RUNAWAY AMERICAN DREAM,
At night we ride to ‘mansions of glory’ in suicide machines!’

If you see that picture of the BC Legislature used as a backdrop to Horgan’s speech in the video, it’s all lit up, like a ‘mansion of glory’.

Horgan is BOUGHT and PAID for by the United Steel Workers, period. A strong economy in BC costs US workers, and they can’t have that, down at USW Headquarters.
********************

Ok Smarty… time to shed the partisan sh$t and open your eyes.

http://www.macleans.ca/politics/will-money-and-arrogance-cost-christy-clark-the-b-c-election/

“Will money and arrogance cost Christy Clark the BC election?”

“With days left in the campaign, the stench of suspect lobbying and fundraising around her party is as bad as ever. But don’t count out Clark just yet.”

http://www.cbc.ca/news/canada/british-columbia/b-c-tax-rebates-for-big-banks-and-big-business-heat-up-election-1.4102650
CBC Investigates
B.C. tax rebates for big banks and big business heat up election
Premier Christy Clark defends the International Business Activity program as NDP demands probe

After this election the implosion will happen and the government of the day will be left holding the bag, same thing happened in the early 90″s when the NDP took over from the Social Credit(BC Liberals/Harper Conservatives) after they finished creating the 80’s housing bubble.

———–

#126 Stan Broock on 05.06.17 at 12:20 pm

#100 MF on 05.06.17 at 9:10 am

You live in a delusional world. Toronto is not a world class city and no European in his/her/(zer, whatever) right mind has moved to live there in the last 10-15 years. Why? Because Europe is much better place to live in with much better economy, free education, much better health care system, weather and where people can actually retire.

People coming to Canada and Toronto/GTA in the last 20 years are workers with no money from the middle East and South Asia.

If you are walking in New York you will instantly see how wealthy the people living there are. Same for London.
Rich people living in expensive cities.

Take for example Munich. The richest city in Germany. People driving last models of BMW and Mercedes.
Very rich people, the elite of Germany and Europe. Same for Vienna and Frankfurt.

House prices there?

Half of the prices in Mississauga or Brampton in absolutist values. Where poor immigrants from third world country live.

The house prices in Canada are the very definition of insanity. It just shows to the world how retarded we are as ability to think independently and critically.

More of a mental institution, a real estate cult, than a modern 21st century nation.

Soo sad. Amen.

#127 Smoking Man on 05.06.17 at 12:43 pm

Kentucky Derby
Triactor

15, 5, 8

#128 Tony on 05.06.17 at 1:12 pm

Re: #109 traderJim on 05.06.17 at 10:33 am

A truism is the higher GTA and Vancouver area home prices go the lower the loonie will go. Canada will be at a complete cost disadvantage with the rest of the world because of the high cost of living in Canada pushing down the loonie in value.

#129 traderJim on 05.06.17 at 1:23 pm

I’m no fan of central banks, but like most things the Swiss know how to do it right.

The Swiss National Bank feels the currency is overvalued and is struggling to keep its value from skyrocketing, so why not just print massive amounts of it and buy other currencies? Makes sense.

But the Swiss take it one step further. Instead of buying US treasuries or Euro bonds paying nothing, they are building a portfolio of the very best companies.

Now I don’t know where this ends up, but I do know that if someone said you can print as many pieces of paper as you want, with your own press, and then trade them for ownership in the best companies in the world, well then I’d have those printers going 24-7.

And it wouldn’t really matter much to me about what price I was paying for those companies.

Seems relevant to not just the stock market, but also the housing market. Maybe it’s not Chinese dudes everyone should be freaking out about, but Swiss dudes!

#130 Leo Trollstoy on 05.06.17 at 1:41 pm

The cad sits in the 70s for a long time. I said it before and have been shown to be right.

#131 For those about to flop... on 05.06.17 at 1:58 pm

#125 Smoking Man on 05.06.17 at 12:43 pm
Kentucky Derby
Triactor

15, 5, 8

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

Alright Joking Man ,here’s my trifecta…

14-5-11

Good luck…

M42BC

#132 Deplorable Communications on 05.06.17 at 2:09 pm

#125 Smoking Man on 05.06.17 at 12:43 pm

Kentucky Derby
Triactor

15, 5, 8
..
Don’t you have a recent million just burning a hole in your pocket.. bet it all dude.. you’re never wrong!

#133 MF on 05.06.17 at 2:10 pm

#124 Stan Broock on 05.06.17 at 12:20 pm

Delusional?

My grand parents left europe for Canada and had zero desire to ever go back, as do I.

Immigration comes in waves, and it means zero that Europeans are not choosing Canada since Europe has an uncertain future.

What is the makeup of Europe’s immigrants by the way? Are they assimilating well?

The future is in Asia (India/China). More immigration from those parts of the world is a good thing.

MF

#134 mike from mtl on 05.06.17 at 2:18 pm

#124 Stan Broock on 05.06.17 at 12:20 pm
#100 MF on 05.06.17 at 9:10 am

You live in a delusional world. Toronto is not a world class city and no European in his/her/(zer, whatever) right mind has moved to live there in the last 10-15 years. Why? Because Europe is much better place to live in with much better economy, free education, much better health care system, weather and where people can actually retire.

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

Euhhhh you’d be surprised. There’s quite a sizeable amount of french born citizens that deliberately immigrated to Montreal for.. get this… work.. and to be french again.

Cost of living here is high of course so freedom 55 is more a dream than reality. Also its comparable to retire south italy, bulgaria, spain and so on.. but so is costa rica, st mateen.

Agreed TO is so vastly overrated by you squareheads, I’d sooner live in Chicago than there.

#135 MF on 05.06.17 at 2:18 pm

And lol at this idea of having rich people driving around in farraris being a good thing.

if you are an Oligarch go to Moscow, if you are a Saudi Prince go to London, if you are a corrupt banker go to New York. What do you think that does for their real estate?

The people coming, like you say, with no money who are looking to build a life, are the kind of people we want and who we have always wanted.

MF

#136 Where's The Money Guido? on 05.06.17 at 2:24 pm

Re:#74 Mark on 05.06.17 at 12:58 am
“Well, I had the pleasure of attending Coast Capital Credit Union’s (BC) Annual General Meeting to see how the vote was to take Coast Capital federal. What an eye opener!”

So if the Coast Capital Credit union goes “federal”, does that subject them to the Bank Act? And shifts them to OSFI regulation?

I’m pretty sure that’s a much more difficult regime to work under than the “provincial” system.

I don’t know specifically what Coast Capital was writing, but it is well known that Vancity (another BC credit union) was writing some pretty crazy subprime loans that probably would not have been permitted of a federally regulated institution.

That’s why they got their buddy Bruce Schouten from OSFi on board, to skirt those pesky OSFI rules.
Shell game extraordinaire!
Bit it’s our own fault, there was 70 people at that AGM (out of 1/2 a million members) and I could count on one hand people who weren’t employees/Directors/CEOs, it was such a friggin love-fest I had to leave before I hurled. It was unbelievable to watch every motion pass with a show of hands, the heads of pink flamingos heads bobbing in unison.
Now there’s democracy in action by having a Credit Union….not!!
No such thing anymore as they will always stack the cart their way as evidenced by what just happened. Cart meet horse….
I guess it worked to keep members away to have the meeting at 5 pm on a work day so far out of the way for most members. It took me almost 2 hours to drive from where I live in the east side of Vancouver’s Lower Mainland.
These guys have an agenda and it’s not to put money in the member’s pockets.
Why else hire a lawyer from BC Hydro, who has been skirting/re-writing Hydro’s laws since 2000 other than to rewrite the CU’s laws and come away with a pocket full o’ coin.
I guess they don’t care what the optics look like with just a handful of naysayers. Party on……
Same shite different pile as I had the same deal with Vancity (Ethical Funds my ass!) in 2008.
OSFI was nothing but a ruse then and will be again when this SHTF.

#137 Where's The Money Guido? on 05.06.17 at 2:35 pm

Re: #85 Smartalox on 05.06.17 at 3:26 am

After this election the implosion will happen and the government of the day will be left holding the bag, same thing happened in the early 90″s when the NDP took over from the Social Credit(BC Liberals/Harper Conservatives) after they finished creating the 80’s housing bubble.

I agree, it’s all in the plan, and the Cons/Liebs will come riding in on their white Rolls to fix everything and the thirsty dogs will lap it up, and it’s “party on Garth!”. The game is so rigged. We are so screwed.

#138 NoName on 05.06.17 at 2:37 pm

#104 traderJim on 05.06.17 at 10:02 am

Assuming you or anyone can tell which markets will outperform for which periods, then of course you should jump from one to another at exactly the right time.

But we all know that timing is impossible.

—-

That KISS was that really necessary?

Yes, “you” can time a market, maybe not it will be perfect but you can be very close to the point where market will roll over up or down, at least that is what i think and believe.
I’ve done it 3 times last time i went cash with almost everything that i could and want, was july 2014, that i went in cash with most of my money i could, and re enter at later date, sucked for me that we are talking about small amounts, so i never get make some serious gains in dollar terms.

On a side note, what’s simple what’s not.
I know people that live of what they make by selling puts and calls of canadian banks, last few yrs, for that person he says it’s very simple, i think its complicated.
Or person that is slum lord, according to hm there is nothing complicated about it, and i wouldn’t touch with 10ft pole, but on another hand i am stupid.

have anice day.

#139 Stan Broock on 05.06.17 at 2:46 pm

price for a toronto detached is about $1.5 million. A ‘correction’ may get ya to $1 mill

go ahead and buy it…

ship has sailed for Toronto and Vancouver real estate

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It is a ship to hell, non-retirement, deteriorating services and health care and lack of jobs for the young.

Glad I am not on it any more. It is always better to watch Titanic sinking from a safe distance than beiing on it.

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#128 Leo Trollstoy on 05.06.17 at 1:41 pm
The cad sits in the 70s for a long time. I said it before and have been shown to be right.

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I respect your view but CAD is going much, much lower, than the 70s.

#140 Con Fuscious on 05.06.17 at 3:00 pm

So you basically feel giddy predicting the evil speculators (who are basically financing new construction) will be trying to get out at the same time through a narrow door and causing a price drop.. how long do you think that could last .. a few months, a year, until the low stock will be exhausted … what will happen down the road when even fewer houses get build? Unless you have a recession to reinforce these hiccups, everything will bounce back fairly quickly.

And what’s this non-sense about job losses? In Ontario it comes after 4 months of pretty good job gains.. Did you mention the numbers 1-2-3-4 months back, when they were much better? And if the US economy is strong, there’s little chance of Ontario not following, at least at half speed. Very poor analysis.

#141 GTA facing a world of hurt on 05.06.17 at 3:04 pm

#113 Dominoes Lining Up on

Yup retail will continue to go bankrupt both big and small. There are thousands and thousands of empty retail both for lease or boarded up across the GTA. GTA is a house of cards and the dominios are now starting to fall.

#142 'GTA is a house of cards ' on 05.06.17 at 4:01 pm

Where do these people come from ?

Lmao

#143 Tony on 05.06.17 at 4:07 pm

Re: 130 Deplorable Communications on 05.06.17 at 2:09 pm

17, 5, 19 stone cold.

#144 Fed-up on 05.06.17 at 6:13 pm

The future is in Asia (India/China). More immigration from those parts of the world is a good thing.

MF

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That’s a very broad and bold statement, what are you basing this on?

#145 Mark Baum on 05.06.17 at 7:09 pm

Spokesperson Jonathan Rotondo [of CMHC] said in an email that the agency is “a committed partner in fraud prevention,” and rarely sees evidence of mortgage fraud. “When there is reasonable evidence of it,” he said, “the insurance can be declared void.”

#146 Millennial_86 on 05.06.17 at 8:11 pm

Garth,
Is it reasonable to say that in 3-5 years, when everyone who has a huge mortgage and dirt low rate today will have to refinance at a higher rate (it has to be higher, no?), an avalanche of defaults or new listings will occur? Wasn’t the very same thing a major trigger in 2008?

#147 -=jwk=- on 05.06.17 at 9:21 pm

Just going through the paperwork for our latest FLA house. The mortgage is 30 years but only the first 7 years are a set rate. after that it resets every year. This is considered risky as most US mortgages are locked in for the full 30 years. So my 7/1 is kind of like the Canadian 5 year renewal thing – every 5 years you are at risk. Anyway.

The point is the rest rate is LIBOR 1yr USD rate + 2.25%. The first term (the 7 years) is 5.5%. After that, LIBOR+2.25 each year. So LIBOR would have to be at 3.25% for my rate to go up. It could go down. Right now it 1.89%. So how does that compare to Canada? Canadian mortgages don’t use any external, international rate. They just use whatever rate they want. So your variable interest rate at RBC is based on the “Royal Bank of Canada Prime Rate” which sounds very official, but is just a number the bank makes up.. Each bank has their own, and it is not tied to actual market rates….

#148 Doug in London on 05.06.17 at 9:25 pm

@ well there you go, post #115:
If houses are still too expensive after a correction, who says you have to buy one? Why not rent and instead invest the money elsewhere in other sectors that, as I said, take a hit when real estate corrects? That’s what I will likely do. In the time being, why not look for other investments that are on sale. Did you miss when XEG briefly dipped below $12?

#149 Con Fuscious on 05.06.17 at 11:02 pm

#95 pete It takes 3-7 years for most immigrants to get into housing market. Immigration was bumped to the quarter million level, if I remember correctly, around 93-94 and 98 was the start to the real bull market in Toronto. Prices also did not increase fast in the beginning since there was still plenty of land available for developers. Papers were full of adverts for homes on 50 ft lots. I hear supply of new detached homes now is maybe one 10th what it was back then.

#150 Con Fuscious on 05.06.17 at 11:20 pm

#144 Millennial_86 In 2008 the increase in rates was quite sharp, but most importantly, in the US there was rampant speculation and flipping of DETACHED houses, which – whatever you hear – it simply isn;t the case in Toronto. Flippers in the US were getting a type of mortgage that was offering very low rates for the first year, increasing sharply, up to 7% by the 3rd year – they figured they;d never get there, but they did once demand softened. + zero down + fraud. Again, no such rush of sellers chasing prices down will be seen in Toronto unless economic situation changes drastically.

Also, when rates go up, it usually happens with increased economic activity and wages, so higher mortgage rates are manageable if the increase is moderate. Higher rates may soften demand, but not necessarily cause sharp rise in supply. This has happened many times in the past 20 years. Be sure the Central Banks learned a lesson in 2008 and they will not repeat the same mistake. They may make new ones – like perhaps increasing rates TOO SLOW.

#151 choptstix on 05.07.17 at 11:35 am

http://www.theglobeandmail.com/news/toronto/condo-flipping-toronto-hot-housing-market/article34908345/?reqid=efa8e12b-e7ad-4329-8300-b132648aca4f

#152 schilli on 05.07.17 at 11:48 am

Great blog Garth! I read it daily!

This is my first time ever posting to your site.

I stumbled upon this a few minutes ago… it’s a great illustration of one condo downtown and the insane flipping that’s been going on.

http://www.theglobeandmail.com/news/toronto/condo-flipping-toronto-hot-housing-market/article34908345/?click=sf_globefb

#153 Craig on 05.07.17 at 2:02 pm

Good read in May 6th Vancouver Sun about money laundering via Real Estate in Vancouver.

http://vancouversun.com/opinion/columnists/douglas-todd-vancouver-is-a-money-laundering-haven

Columnist Todd has been a consistent demonizer of foreigners. Small man. — Garth

#154 I'm out! on 05.07.17 at 2:03 pm

Toronto semi, rental. Bought 1998: $270,000. Sold 2017: $1.3M Buh Bye. Anyone buying now is playing with fire.