How bad can it get?

So, Derek got an offer. Wohoo.

Of course you remember this poor blog dog. Took the advice and sold at the tippy-top of the market – getting a peak-house price of $2.2 million for his north ‘burb McMansion. Over asking, of course. Multiple offers. Literally sold in hours. Ecstatic.

But that didn’t last. The buyers (one’s a realtor) showed up a couple of days later, moaning, gnashing, sweating and fretting, asking to get out. Derek told them they had a contract and life isn’t fair. Do the deal or get sued.

Well, Easter came, then the Ontario anti-bubble measures, and then the wheels seriously fell off the market. Derek re-listed when it became clear the deal was in serious jeopardy, got a litigation lawyer and there she sits. The buyers have ignored every letter, the statement of claim, and may (for all D knows) have moved to someplace remote and exotic, like Regina.

But, finally, some action. “Lo and behold,” Derek reports, “we got an offer last night! 1.7 conditional on financing and inspection. Really nervous to leave so much on the table. Agent thinks there may be at least one more interested party so we will see what pans out.”

If our guy does do the deal, he has a claim for $500,000 in damages (plus costs) – if he can find the purchasers. Will keep you posted. In the meantime here is a stark reminder of what’s happening to the market – when a $2.2 million property loses 23% of its value in three months. This is absolutely consistent with the numbers posted here yesterday. It is one of the fastest market unwindings in history – and the bottom is yet unknown.

Meanwhile in Oakville, Shay is out shopping for a townhouse, watching prices fall as listings mold. He sent me this email from his agent to illustrate current conditions. Yeah, it’s a buyer’s market. (The note has been redacted to protect the innocent.)

So, here’s a question many have been asking: if this sharp correction in the nation’s largest market impacts other areas and leads to a general real estate decline of Kardashian proportions, whither the economy? With households so steeped in debt, with so much net worth tied up in a single asset, with interest rates rising, and with a huge chunk of the economy tied directly to real estate, won’t everything head south if housing blows up? Just as occurred in the US?

The short answer is a downturn deep and widespread enough in property values would cause a recession. That’s not the end of the world for the economy (we had one in 2015-6), nor does it necessarily mean the stock market would tank or banks wobble. In fact, investors can do quite well when the economy is in negative growth.

Key things to remember: most Canadian mortgages are insured (including all those which are high ratio) which means the big banks are insulated from the kind of mess and despair that befell US lenders. Second, in global terms, this place is a puddle. Properties here can plop in value and consumer spending dry up, but it won’t result in the same stock-eating beast that savaged equity markets in 2008-9. It was the drying up of credit in America, then across the world, that took us to the brink.

But there’d be painful consequences. Unemployment would spike after months of great job growth, since a million people now work selling, building, fussing over, insuring or financing houses (Toronto alone has 48,000 realtors). In fact real estate employs more than oil and gas and manufacturing combined – a huge departure from the past, making this downturn more serious.

Most economists think if the correction we’re now in gets worse, economic growth would be hacked from 2% to about 1.5%. Yup, that’s it. For things to become ugly for investors, there would have to be a spike in mortgage defaults leading to a loss of confidence in the financial sector. But in reality, a collapse in house prices isn’t going to drive people out of their homes, and Canadians have no history of walking away from mortgage debt.

The bottom line is a real estate mash-up would hurt a lot of families by erasing home equity and threatening jobs. They’d spend less, dropping economic growth. The country could tip into recession and the Bank of Canada might have to stall its rate agenda for a while, or even reverse it. That monetary stimulus could end up goosing stocks – since corporations love cheap money. Meanwhile smart investors with the bulk of their wealth in US or international assets (as consistently recommended here) plus a 20% portfolio weighting in greenbacks, will probably skate through unscathed.

Way less lucky would be those overexposed to housing, carrying big debt, at risk of seeing their entire equity erased and facing job implosion. Realtors, of course,  qualify for all of the above.

So let’s be charitable. Relief Hampers for Re/Max. Who’s in?

219 comments ↓

#1 nick on 08.02.17 at 6:31 pm

first

#2 TheSpangler on 08.02.17 at 6:34 pm

It would sure be nice to see a reduction like that in the Sea to Sky area….

#3 Happy Housing Crash Everyone! on 08.02.17 at 6:37 pm

Realtors are screaming in horrible financial pain as they lie saying everything is ok. Lol thanks realtors you lost all credibility to the masses. You have now been branded as lying shill shysters and everyone wants to see the 43000 toronto shyster scream in horrible financial pain. Happy HAPPY Housing Crash Everyone! :-)

#4 FOUR FINGERS WATSON on 08.02.17 at 6:38 pm

Having more than one buyer fighting over your home is the ultimate home seller’s dream.

And clearly, in the Okanagan these days, dreams do come true! How do you get the most out of a multiple-offer situation?

Helping our seller clients through many of these situations lately, we have put together the following tips for handling an offer competition on your home:
…………………………..

Market still on fire here in BC, and it’s not just forest fires hahahaha.

#5 crowdedelevatorfartz on 08.02.17 at 6:38 pm

Relief hampers for realtors?
not a chance.
For the greaterfools that they led to the slaughter…..maybe.

#6 Smartalox on 08.02.17 at 6:40 pm

REBGV Stats out today. At least the headline on the press release ‘smells’ honest: Metro Vancouver sees fewer sales, more listings

http://www.rebgv.org/sites/default/files/REBGV-Stats-Package-July-2017.pdf

If you push past the HPI pages to page 6 the ‘Sales facts’ you see figures to compare ‘Year to Date’ sales (i.e.: deals that closed, Jan to July). You have to do some math, but if you take the time, you’ll see that detached sales are down 20% overall across the region:

down 10% in Van Eastside
down 12% in North Van
down 16% in Burnaby
down 19% in West Van / Howe Sound
down 20% in Richmond
down 23% in Van Westside
down 25% in Maple Ridge / Pitt Meadows
down 27% in Coquitlam
down 30% in PoCo
down 37% in New West

These are significant drops in sales volumes, over the course of several months, that take seasonal variation into account.

It’s one thing to have a ‘down month’ because of weather, or temperatures, etc. but this is evidence of a sustained and accelerating trend.

#7 2 Cents Canadian on 08.02.17 at 6:44 pm

“Canadians have no history of walking away from mortgage debt”
I wonder if new Canadians will walk away from mortgage debt? Or do everything they can to wiggle out of their contractual obligations.

#8 BlogDog123 on 08.02.17 at 6:45 pm

What will all those realtors do with listings up, nothing moving, nobody buying, junk mail flyer$, adverti$ing costs, wait and see… Do they get paid only if the house transaction occurs? Sounds like a good time to change careers…

#9 FLHTK on 08.02.17 at 6:48 pm

Going to realestate agents starving in abit….

#10 Brunett43 on 08.02.17 at 6:48 pm

A couple more weeks and my 14yr mortgage will be paid in full slicing 11yrs off. Yippee!!

#11 rainclouds on 08.02.17 at 6:52 pm

“(Toronto alone has 48,000 realtors).”

Chicago, the third largest metropolitan area in the USA has 13k “Realtors”

Of course, They can call themselves whatever they like. BUT they are Commissioned SALES. End of story

Over to HHCrash for his erudite opinion of their professional standards.

Rats from a sinking ship…………………….

#12 young & foolish on 08.02.17 at 6:52 pm

People will always have to pay for a roof over their heads … the only people clamouring for a crash are those hoping to buy. Reasonable people know that a deep decline will likely impact their business.

Regarding Derek … his situation is that from which outlandish statistics come from (he sold at a ridiculously high price, way above reasonable value, then had to settle for a more rational figure close to his initial asking price … all that happened is that the froth came off the top).

#13 Franco on 08.02.17 at 6:53 pm

Is it logical to expect higher earnings than the typical 6-8% professional investors offer once mortgages rates (and inflation in general) go up?

#14 HoweStreet.com on 08.02.17 at 6:54 pm

Ross Kay on HoweStreet.com Radio:
Should You Hold off Buying a Home?
Why are realtors removing quotes from their websites?

http://www.howestreet.com/2017/07/31/should-you-hold-off-buying-a-home/

#15 Todd on 08.02.17 at 6:56 pm

Is this TREB’s way of letting everyone know they are going to pad stats so they don’t look so bad?

From last month’s market watch:

In conjunction with TREB’s redistricting project, historical data may be subject to revision moving forward. This could temporarily impact per cent change comparisons to data from previous years.

#16 Andrew Woburn on 08.02.17 at 6:57 pm

One effect of high house prices.

“The Great Stagnation: Americans stopped moving to find work”

“Chang-Tai Hsieh of the University of Chicago and Cal Berkeley’s Enrico Moretti argue in a paper published in May that land-use regulation has held workers back from moving where their labor is most valuable. Since 1964, this has lowered GDP growth by 50%, they say.”

“We changed from a country in which landowners had relatively unfettered freedom to add [housing] density to a country in which veto rights over new projects are shared by a dizzying array of abutters and stakeholders.” He finds that one-tenth of American homes are worth twice their price to build, and that these are concentrated in the most productive parts of the country.

https://www.axios.com/sky-high-home-prices-are-thwarting-thwarting-economic-mobility-2466575966.html

#17 Victor V on 08.02.17 at 6:57 pm

Canadian realtors brace for the end of the boom as housing market tightens

http://www.cbc.ca/beta/news/business/realtors-housing-market-1.4231913

Veteran realtors who have seen the industry swell with inexperienced agents have no doubts that a slowdown will decimate their ranks. “It is definitely overpopulated,” said Shawn Zigelstein, a realtor in the York Region, north of Toronto. “A downturn will weed out of some of those agents who got into the business for the wrong reasons.”

Already, many realtors are struggling in the crowded market. Nearly half of Toronto’s licensed realtors did fewer than two deals last year, according to Brian Torry, general manager at Bosley Real Estate in Toronto.

Less than a third did five or more transactions. “It is a tough industry to break into,” said Jared Gardner, 38, who got his real estate license last year and works in the Toronto area. Fleming believes many agents are already making less than minimum wage once license, membership and brokerage fees are paid, and it can only get tougher if sales continue to dry up.

#18 OttawaMike on 08.02.17 at 7:00 pm

What other industry sees a surge of new “talent” balloon to 48k?

Can you imagine if everybody decided being a dentist or plumber or pilot was lucrative and the numbers swelled up to excess?

How can it remain such an easy field to join when you are essentially handling the life savings of a family in a transaction?

#19 Save Glen Abbey on 08.02.17 at 7:00 pm

Oakville townhomes are still way overpriced. $699,900 for a townhouse here is ridiculous.

#20 Smartalox on 08.02.17 at 7:00 pm

Sorry, sorry. I totally pooched it. These are the actual detached sales numbers from the REBGV report. Sales of detached homes are still down, but the decline is worse than I posted previously.

Detached Sales % change
REBGV Total -36%

Van Eastside -22%
North Van -30%
Port Coquitlam -31%
Richmond -35%
MR-PM -38%
Burnaby -38%
Coquitlam -39%
Van Westside -44%
New West -48%
Wvan HoweSnd -50%

http://www.rebgv.org/sites/default/files/REBGV-Stats-Package-July-2017.pdf

See page 6.

Sorry about the mix-up, my attempted import from the PDF didn’t work properly.

#21 Andrew Woburn on 08.02.17 at 7:01 pm

“Americans Die Younger Despite Spending the Most on Health Care”

https://www.bloomberg.com/graphics/2017-health-care-spending/?

#22 Happy Housing Crash Everyone! on 08.02.17 at 7:04 pm

#12 young & foolish

You shyster realtors make me sick.Always lying ans always making up stories. $500000 (If he even sells) is a CRASH (25% drop) and this in three-months. First you lying shill said prices won’t go down . Now you changing stories again . Realtors are useless and government should open up the system. Realtors in an open and free market will be a fraction of the cost. The housing crash is only one of your problems. Happy Housing Crash Everyone Everyone! :-)

#23 Sold out in Vancouver on 08.02.17 at 7:05 pm

Re: Having more than one buyer fighting over your home is the ultimate home seller’s dream.

And clearly, in the Okanagan these days, dreams do come true! How do you get the most out of a multiple-offer situation?

Helping our seller clients through many of these situations lately, we have put together the following tips for handling an offer competition on your home:
…………………………..

Market still on fire here in BC, and it’s not just forest fires hahahaha.

—————————————-
Maybe what you say is true in Kelowna, but not true in Penticton or Vernon. I’ve been watching the market daily for 6 months, over the last 10 days there have been numerous price reductions, as well some places taken off the market after 60 and 90 days with zero offers. The realtor who I am working with, commented “There’s been a real lull up here with the flooding and fires”
You can simply check on Point2homes to confirm if you like, the truth is out there !!!

#24 Dave on 08.02.17 at 7:06 pm

What about our banks then? Just a hold or accumulate more shares? This could play out for a few years. Would hold off on any new buying?

#25 DON on 08.02.17 at 7:06 pm

“But in reality, a collapse in house prices isn’t going to drive people out of their homes, and Canadians have no history of walking away from mortgage debt…

Way less lucky would be those overexposed to housing, carrying big debt, at risk of seeing their entire equity erased and facing job implosion. Realtors, of course, qualify for all of the above.”

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

Just thinking out in the open.

Never before has housing been so expensive when compared to wages. Never before have people become so indebted to accomplish what it took their parents decades to achieve. Never before has anyone walked away from housing and never before have we had the millenials (and others) so indebted and it may become ‘Sexy’ to walk away from mortgages and then there’s the divorce rate. Not doom and gloom but…reality.

The bubble was irrational on the way up and to expect a rational downturn is somewhat wishful thinking. But then again this is just a temporary blip in the rise to infinity and beyond.

Great post Garth, hopefully this will be the last time you will need to post and explain this.

Oh yah – there are just as many realtors as listings in Victoria – in the Times Colonist yesterday.

Enter stage left…Happy Housing Crash to say a few words on the subject. Happy the mic is yours.

#26 I'm stupid on 08.02.17 at 7:10 pm

Spoke to a few builders today, prices slashed by 120k on two projects and no buyers. Buyers are walking away, refusing to take possession. It’s getting bad already.

#27 M on 08.02.17 at 7:11 pm

“Key things to remember: most Canadian mortgages are insured ”
…aha… so was Fanny and Freddy

“the big banks are insulated from the kind of mess and despair that befell US lenders.”
…right.. our banks etc etc etc.
All bull. There is no difference in the status of banks. Actually “our” banks (vs “their” banks) were solidly bailed out massively on the last one. On the tune of
118 B. As a matter of fact compared to the US capital bailed by Bush2 (800 B), canadian banks were even MORE… bailed out :)
Other than that… the bank legend sounds good and there are i enough morons to believe it .

And yes Garth, it will be a deep recession here in Canada for a long time to come. Depression. For we’ll probably drag down some very important monkeys down south, since they own all the major RE endeavors here.
So here you have it. Big. Smoky. Hole. In The Ground.

..a good thing actually. Valuations will come everywhere to the level of their real earnings.

We shoulkd NOT be afraid about the big bad wolf. We should just be prepositioned.

PS That unemployment will skyrocket once it digs the housin’ s bust.

#28 Gov Herd Protection on 08.02.17 at 7:12 pm

“The country could tip into recession and the Bank of Canada might have to stall its rate agenda for a while, or even reverse it. That monetary stimulus could end up goosing stocks – since corporations love cheap money.”

And there you have it. The path to rate normalization is far from guaranteed. Sounds like a classic bailout of the owner if rates stop going up or actually decline.

See – Re is too big to fail. And if the rate hike agenda gets put on hold then there is no stopping RE – people will pile in again once prices dip a little more since any back move will reinforce the realtor crap about too big to fail.

Patient, prudent savers and investors get screwed over again by the herd. So what if your portfolio of stocks go up 20% – it does not compare to the hundreds of thousands of dollars when your house goes up 20%.

There is literally no reason not to buy after all these years…

#29 Mark on 08.02.17 at 7:12 pm

Price declines are likely being exaggerated by changes to the sales mix at this point (much as the sales mix exaggerated changes to the upside, they also exaggerate changes to the downside). However, its getting very hard for the Realtors to deny that prices have stagnated for the past few years and are now falling nationwide. Bank credit spreads are expanding significantly on account of poorer consumer credit-worthiness. The Bank of Canada will soon be forced to re-visit its mistaken decision to raise policy rates given the terrible state of the Canadian economy.

Ross Kay on HoweStreet.com Radio:

Yes, some very interesting commentary about Realtors’ overwhelming commitment to the sell side.

But can someone else independently verify Ross Kay’s claim that Realtors are prohibited from entering into agreements with a buy-side Realtor to incent them for price reductions? Ross Kay claims that this is “illegal” under the regulatory framework for Realtors in the provinces. I’ve never heard of such (but admittedly, I know nothing of the professional or legal framework in which Realtors are regulated!).

#30 M on 08.02.17 at 7:12 pm

CDN banks bailed out last time
https://www.youtube.com/watch?v=9K_N0uOXkQA

… somehow..I bet it was helicopter ben that did it. Harper was broke. …and the Yanks wanted to defend their exposure.

#31 ANON on 08.02.17 at 7:14 pm

<blockquote<It is one of the fastest market unwindings in history – and the bottom is yet unknown

I remember a chart shown here a couple of times lately, at the end of the blog posts, out of the blue, while the peak was in. Cannot find the links at the moment, sorry. It’s probably something like 10%-15%, no biggie. It will jump back up, everyone says so.

#32 AGuyInVancouver on 08.02.17 at 7:17 pm

#6 Smartalox
Lower sales are great, but I don’t see any sign of lower prices. :(

#33 Mark on 08.02.17 at 7:21 pm

“Is it logical to expect higher earnings than the typical 6-8% professional investors offer once mortgages rates (and inflation in general) go up?”

On balanced portfolios, no, because bond portfolios typically would be expected to underperform with higher interest rates as duration is no longer an investor’s friend, but rather, an investors enemy. Canadian equities, of course, tend to do a lot better in a rising rate environment than a falling rate environment so you might get a bit of lift there, especially if you’re overweight Canada. But a typical investor in a globally balanced portfolio shouldn’t really expect to see an increase in returns due to higher interest rates on their balanced portfolio. That’s the whole point of balance, after all — you’re giving up some of the upside associated with, for instance, interest rate changes or concentrated positions, in exchange for stability.

People will always have to pay for a roof over their heads … the only people clamouring for a crash are those hoping to buy.

Some, like myself, are hoping for a return to more reasonable prices so there’s capital and rewards available to business ventures and consumption that isn’t purely real estate.

We can’t all be Realtors, Bankers, Lawyers, or assorted public servants (including healthcare workers) that have benefitted from the low interest rate, high RE environment. There are other vital sectors of the economy as well, in which people have made investments and not seen a return. Probably one of the most startling examples being the precious metals sector, which hasn’t provided a return to shareholders since 1984 or even earlier.

#34 InvestorsFriend on 08.02.17 at 7:23 pm

About Moving to Romania or elsewhere

Canadians, of course, are free to move anywhere within Canada.

But they are not free to move to any country on earth. (That particular natural human right awaits a distant future time to be established)

Which countries welcome Canadians?

Which allow you to work or operate a business?

#35 Tell them Garth on 08.02.17 at 7:24 pm

DELETED

#36 InvestorsFriend on 08.02.17 at 7:28 pm

Derek…

Will have his day in court and the Realtor might face suspension for unprofessional conduct. With $500k on the line, Derek can afford to pursue this.

One of the main pillars of a free economy is a court that enforces contracts. It should be an affordable and accessible court as well.

The contracted original buyers face winner’s curse. Too bad. It’s a hazard of entering auctions which was what house sales amounted to until recently.

#37 chopstix on 08.02.17 at 7:28 pm

Garth: wish you’d comment on the condo markets in Toronto and (especially) Vancouver…that area seems to be impervious to the shakedown (remember new coast realty: it’s in the condo market where the ‘real gold lies’)…sort of makes sense, too given 1/people downsizing, selling off and moving to smaller accomodations and 2/ people can’t afford sfh and so condos are the ‘next best thing’ and also many people are renting (because they’ve given up on being able to buy..or are holding off/saving up..)

#38 tccontrarian on 08.02.17 at 7:35 pm

“Properties here can plop in value and consumer spending dry up, but it won’t result in the same stock-eating beast that savaged equity markets in 2008-9. It was the drying up of credit in America, then across the world, that took us to the brink.” – GT
**********************************************

There’s more than one reason why bear markets happen – not only the ‘drying up of credit’. There are a few accomplished investors who believe that the next bear market will be even more damaging overall than 2008-9.
Why?
Well, basically because we now have even more extreme valuations of several asset classes than we did in 2007-8.
Coupled with higher debt levels, rising rates, less cash-reserves and complacency high (VIX very low), etc., it’s almost inevitable for things to get ugly.
In fact, the narrowing of the base of stocks making 52-week highs (mostly in FAANGs) is a pretty clear signal that things have likely already begun to unravel.

TCC

#39 Dolce Vita on 08.02.17 at 7:41 pm

#4 FOUR FINGERS WATSON

Dreams do come true preson must not live in Kelowna, Price Changes for August:

Average Change: -2.81%
Up:23 Down:175
Overall $ Change: -6,933,971.00
Average $ Change Amount: -35,020.06

#40 bigtowne on 08.02.17 at 7:42 pm

The big issue for renters in the big smoke is no inventory…before you could move out to the hinterland as in Burlington; Milton; Kichener and the hammer and find affordable rent. Now there seems to be no relief unless you go north to Elliot Lake.

We are considering Alberta as they have high vacancy rates for rentals. Being Canadian means you need to be flexible and after all it is a large geographic space. I look good in a cowboy hat and jeans are my style.

#41 45north on 08.02.17 at 7:43 pm

how bad can it get?

signs of collapsing Toronto real estate market:

Smoking Man sells ✓

property tax delinquencies go up ✓

more security guards in banks ?

#42 kabloona on 08.02.17 at 7:43 pm

“…Canadians have no history of walking away from mortgage debt.”

Untrue.

Ever heard of the AHOP program back in the early 70s….?

Canadians walked away from their “housing debt” in droves….defaulted even at 25% gross debt service ratios.

Federal Government ended up the biggest landlord in the Country before the program was finally wound up, If I recall correctly…

But I’m sure this time is different.

:-)

Not even remotely similar. — Garth

#43 Fake News Again on 08.02.17 at 7:43 pm

Official today in Vancouver. Average home price over 1 million dollars. No foreign buyers though. Honest. Ded Sirius.

#44 Nanaimo on Fire on 08.02.17 at 7:45 pm

The stats never lie. Vancouver needs more well lubricated biker gals manipulating the tides to keep up with the 20% YoY on the Island.

http://www.vireb.com/assets/uploads/07jul_17_vireb_stats_package_64292.pdf

#45 The Greater Cauliflower on 08.02.17 at 7:47 pm

Yes, I am interested in being kept abreast of Derek’s situation.

#46 Alberta Ed on 08.02.17 at 7:55 pm

Things are fine, just fine, in Calgary, according to CREB, as reported by the ace business reporters at CBC. In other words, standard regurgitation of a press release, as usual with the Mother Corp.

#47 TurnerNation on 08.02.17 at 7:57 pm

Simply, introduce a species hostile toward Realtors. Enter, rabidly posting Blog Dogs.
They’ll be specious.

#48 Ray Skunk on 08.02.17 at 8:00 pm

Garth, you should have also redacted the appalling grammar to protect the illiterate.

The [redacted] Homes Team proving once again you don’t have to complete ninth grade in order to obtain your RE licence.

#49 I thinks I know something on 08.02.17 at 8:02 pm

If the temporary minor setback in GTA house prices were to become a long protracted major setback, then it could have serious economic impact. Many, many people take out second mortgages and HELOCs and spend the money and goose the economy. Banks won’t be handing out the candy the way they have if GTA houses really do reset to 2014, or prior values. However, that won’t happen.

#50 Looney Baloney on 08.02.17 at 8:13 pm

Mr. G, those MS Paint skills are astounding. You should seriously consider taking up digital artistry as a hobby.

Not my smears. I’m less neat. — Garth

#51 FNAiks on 08.02.17 at 8:26 pm

I would assume TREB holds off releasing their results until EOD Friday so they’re buried by the long weekend. Although isn’t there a deadline tomorrow for the Comp. Bureau ruling? Did I hear wrong? Bueller?

#52 young & foolish on 08.02.17 at 8:28 pm

People will walk away from their houses and mortgages and go where exactly? Across the street into a rental?

#53 FOUR FINGERS WATSON on 08.02.17 at 8:30 pm

#23 Sold out in Vancouver
#39 Dolce Vita

I just recently sold a townhouse I owned in Kelowna. Met with the realtor at the house and he installed a lockbox. A neighbor saw him install the box. Realtor was driving back to his office to list it online with mls, I stayed at the house to clean up. Ten minutes later my phone rang. It was the realtor, his phone rang while he was driving to the office. He asked if another realtor could show in 2 hours. I said ok. Sold on the first showing for over asking before it listed on mls. The only condition being that there was no pine beetle infestation in the pine tree. There wasn’t and it closed no problem.

#54 Cloudy on 08.02.17 at 8:31 pm

Hopefully BC slows down, but so far nothing on the radar. Southern Vancouver Island is crazy busy. If there is a downturn the sad thing is most realtors here have made enough money that, provided it was well cared for, could carry them through a decade long downturn or longer. Some of the realtors I know that barely made it through highschool have made more in the last 5-10 years than an average Joe will make in a lifetime. $300,000-500,000 annually for the last 3-5 years. Doing my damndest not to begrudge them. As I always say, if it was that creamy everybody would do it, including me.

#55 Long Branch Apprentice on 08.02.17 at 8:32 pm

Does anyone know anything about country homes around Uxbridge going for under asking or even at asking? It seems like a few people could have possibly overbuilt out there.

Willing to wait, for 3-5 years if I have to. Wife is 30, kid on the way, I’m 33 just went to school for power engineer. Will have my 3rd class ticket in the spring.

Told wife she doesn’t have to work anymore, so either I gotta get a job soon or pull a SM-like Fx move…

It’s good to have options.

#56 oncebittwiceshy on 08.02.17 at 8:33 pm

>>>>>>>>>Garth: “But in reality, a collapse in house prices isn’t going to drive people out of their homes, and Canadians have no history of walking away from mortgage debt.”<<<<<<<<<

Don: "Never before has anyone walked away from housing and never before have we had the millenials (and others) so indebted and it may become ‘Sexy’ to walk away from mortgages and then there’s the divorce rate. Not doom and gloom but…reality."

I personally think that you are both right. Garth is correct in terms of history but Don hit the nail on the head with this new generation of buyers.

Millenials have thoroughly enjoyed the benefits of rising equity with cars they could only dream of owning, quads, boats, vacations and restaurants.

Everything they buy is based solely on the monthly payment. Look at marketing today. Everything is billboarded as a monthly payment. Houses, cars, electronics, phones and vacations. I'm not even sure that the overall price means anything to most.

The biggest problem is that the majority have absolutely no compunction about racking up this debt and then walking away from it. The answer to a $650,000 mortgage on a $400,000. property will be bankruptcy.

Put yourself in their shoes, Garth. You were suckered into this market by the media, real estate agents or mommy and daddy and now you're facing a lawsuit from CMHC for $250,000 because they will still want their money.

That is $250,000 that they can't afford to pay back and still live somewhere else. The answer: walk away.

They will disappear faster than Derek's buyers. Of course it won't be that easy but believe you me it will be the first solution that they attempt.

This, of course, will only exacerbate the crash in prices.

Canada is about to learn a very expensive lesson.

#57 Ex-Cowtown on 08.02.17 at 8:35 pm

I wouldn’t get too bent out of shape about a 25% drop in values in GTA. Last year prices were up a fluffy 30%, so all the decline means is that last year never really happened. Unless you bought in in the last year, in which case your kind of hooped. What happens from here on in is really the tale of the tape. Another 25% or so and you’re cutting the bone and doing some serious long term damage.

As to people walking away, not all of them need to, and it didn’t happen in the US either. And remember, 5-6% of homeowners with a mortgage are STILL underwater in the US 10 years later.

http://news.buzzbuzzhome.com/2017/03/us-homeowner-equity-increased-q4-2016-many-homeowners-remain-deep-underwater.html

If I was a millenial, deeply upside down on my mortgage and had no other assets, I’d declare bankruptcy, get scrubbed clean and start all over again. No point dragging that type of debt around for the next ten or so years.

But it gets even uglier; bear in mind that around 5% of Yankee mortgage holders are still upside down after 10 years of in a declining interest rate environment. If rates were just a touch higher or climbing the upside down number might be 10% or more.

And there in lies the Millenial Death Watch; with a huge mortgage, upside down, and climbing interest rates bankruptcy looks no so bad. So ya screwed up? So what. You’re young, cut your losses and get out. You don’t want to be in your fifties and still hoping things will get better soon.

#58 young & foolish on 08.02.17 at 8:36 pm

“Derek…
Will have his day in court and the Realtor might face suspension for unprofessional conduct. With $500k on the line, Derek can afford to pursue this.
One of the main pillars of a free economy is a court that enforces contracts. It should be an affordable and accessible court as well.”

I suspect said realtor may plea temporary insanity ….

#59 Chaddywack on 08.02.17 at 8:38 pm

Yeah it’s pretty hot in Vancouver still. Prices at record highs and now I’m starting to see SOLD stickers slapped on everything again.

I hear that most are going above asking with minimal conditions, if any.

Maybe pre-approval people who got in before the 0.25 increase?

I don’t know what to make of this world anymore. Between T2’s social justice nonsense and Vancouver real estate…….

#60 For those about to flop... on 08.02.17 at 8:43 pm

That is a picture of Broadway Skytrain with the watermelons and he is going to make boatload of Pink Lemonade…

M43BC

#61 oncebittwiceshy on 08.02.17 at 8:45 pm

>>>>>>>>#52 young & foolish on 08.02.17 at 8:28 pm
People will walk away from their houses and mortgages and go where exactly? Across the street into a rental?>>>>>

Nope, where ever they can afford to rent because that’s the way the real world works.

Those that received the benefit of mommy and daddy’s money for a down payment might move back home.

Who knows, but the fact that these forced sellers don’t know where to go to live isn’t going to change anything about their situation.

I feel very sorry for a lot of kids that were pushed, cajoled and suckered into this market. Maybe a few thousand snookered buyers can get together and start a class action suit against the real estate agencies and the media.

I know, just dreaming but it would be karma. A lot of these kids didn’t deserve this stupid market.

#62 Mike on 08.02.17 at 8:47 pm

.
It will all be up and running again in GTA. Just a blip. This is Canada. Totally different.

Blip.Blip. Beep. And here comes bidding wars and 20% YoY increases again.

#63 CJBob on 08.02.17 at 8:49 pm

The country could tip into recession and the Bank of Canada might have to stall its rate agenda for a while, or even reverse it.
___________________
And while some have been saying rates wouldn’t go up because the government wouldn’t let it happen, the saner of us here have been saying rates won’t go up MUCH because the economy simply can’t withstand it.

Perhaps one more rate increase for Canada and then a long pause to see how things are going. Inflation is low and big portions of the economy are dependent on oil prices and the housing sector.

Our benevolent leader has finally acknowledged that rates may not be spiking up like his posts of the last few weeks/monthly/years have been warning. Welcome to the dark side.

That is not what I said, and you know it. If there is a recession (six months of negative growth) the central bank may respond. If no recession, up she goes. — Garth

#64 Howard on 08.02.17 at 8:50 pm

#17 Victor V on 08.02.17 at 6:57 pm

Less than a third did five or more transactions. “It is a tough industry to break into,” said Jared Gardner, 38, who got his real estate license last year and works in the Toronto area.

————————–

Interestingly enough, I actually know Jared Gardner. I worked with him briefly more than a decade ago (different industry obviously).

He’s a nice guy and hope he manages to find a new career after entering that snake den at the very top of the market.

#65 Smoking Man on 08.02.17 at 8:53 pm

Derek’s mistake was not selling to professional people. Took the highest bid. Greed gets you everytime.

Should have made a better effort to resurch the buyers/bidders on Google. Found out there occupations.

Took me five mintues to get the goods on my buyers, if they walked. Great carriers destroyed. I wasent worried about them. I was worried about who the greater fool was that bought their place at a huge price.

It all worked out.

Dr Smoking Man
PhD Herdonomics.

#66 Andre on 08.02.17 at 8:57 pm

Thanks Garth for the answer.

#67 Shawn on 08.02.17 at 9:00 pm

TSLA!

I can’t wait to buy a Model 3. What a car!

Model 3 good. Canada housing market had.

#68 Dolce Vita on 08.02.17 at 9:02 pm

#53 FOUR FINGERS WATSON

Your observation of 1 is statistically insignificant when compared to 198 price changes in August for Kelowna (175 of them down).

You will need another 34 such good luck stories for a sample size of 35 in total to make your point so as to be taken seriously at all.

#69 Dolce Vita on 08.02.17 at 9:08 pm

#52 young & foolish

You must be truly young.

As in Calgary in the early 80s, they leave town to:

1. look for work elsewhere,
2. stay with relatives or friends there and
3. duck any AB Sheriff hunting them down with a Court RSVP about foreclosure.

History repeats itself, same dung, different pile.

#70 Madcat on 08.02.17 at 9:09 pm

Companies like mine are struggling to find decent applicants for manufacturing positions.

Perhaps once all the construction workers are laid off from their condo tower projects I’ll be able to snap some of them up…

#71 Don't Tell VREU on 08.02.17 at 9:12 pm

#44 Nanaimo on Fire on 08.02.17 at 7:45 pm
The stats never lie. Vancouver needs more well lubricated biker gals manipulating the tides to keep up with the 20% YoY on the Island.

http://www.vireb.com/assets/uploads/07jul_17_vireb_stats_package_64292.pdf

———-

Two things:

1. Who wants to tell VREU that the Victoria market has not collapses despite her two years of ‘collapsing sales’ comments.

2. Realtor stats don’t lie? Really – why do we call them franken numbers? Oh wait, its only franken numbers on the way up but on the way down they are trusted; and when they talk about the mythical 5% foreign buyers, then they are trusted right?

#72 conan on 08.02.17 at 9:13 pm

#58 young & foolish on 08.02.17 at 8:36 pm

“I suspect said realtor may plea temporary insanity ….”

I am trying to make sense out of it as well.

It is one thing scoring big profit ,on a deal or three, then losing your shirt versus losing big on your first deal.

I suspect the realtor can not pay, meaning ruined. Maybe he/she could turtle, and buy another house after this shit storm is over? Sell it to make a 500 k profit, then repay his debt.

Nah, the money is gone.

#73 FOUR FINGERS WATSON on 08.02.17 at 9:14 pm

The Real Estate Board of Greater Vancouver says the typical price of a home in Metro Vancouver has surpassed $1 million.

The board says the composite benchmark price for all residential properties in the area is currently $1,019,400, up 8.7 per cent from July 2016.

The benchmark price for detached properties in the area is about $1.612 million, for attached properties $763,700 and for apartments $616,600.

#74 Don't Tell VREU on 08.02.17 at 9:16 pm

#54 Cloudy on 08.02.17 at 8:31 pm
Hopefully BC slows down, but so far nothing on the radar. Southern Vancouver Island is crazy busy. If there is a downturn the sad thing is most realtors here have made enough money that, provided it was well cared for, could carry them through a decade long downturn or longer.
——-

That is blasphemy to VREU. Besides, the south of the inventory is seeing price fatigue. Listings are on a lot longer with significant price declines. Especially the areas outside Victoria. They are the last to rise with a rising tide and the first to go out with falling tide…proven over and over and over again in every bubble.

#75 Paddler on 08.02.17 at 9:23 pm

#6 REBGV Stats out today. At least the headline on the press release ‘smells’ honest: Metro Vancouver sees fewer sales, more listings

Sales might be down and listings up but there are still lots of offers over asking. The drop in house prices appear to be minimal compared to the GTA. Go figure. Vancouver seems to be a different market.
BTW I Don’t live in Vancouver.

The building that is going on here in Nanoose Bay (Van. Island) is unbelievable Lots are selling like hot cakes.

#76 NEVER GIVE UP on 08.02.17 at 9:27 pm

Jim Morrison wrote this little piece to honor the Canadian Real estate Crash!

When the still sea conspires an armor
And her sullen and aborted
Currents breed tiny monsters,
True sailing is dead.
Awkward instant
And the first animal is jettisoned,
Legs furiously pumping
Their stiff green gallop,
And heads bob up
Poise
Delicate
Pause
Consent
In mute nostril agony
Carefully refined
And sealed over.

#77 Keep Calm and mow the lawn on 08.02.17 at 9:32 pm

what a bunch of cry babys
as if realtors are obliged to somehow supply data to your armchair world
realtors give themselves awards based on dollar volume, the mission is commission
best agent? not the guy who did such a great job that the clients never move, but the ones who makes the most money, they are called ‘superstars’ for a reason,
it’s called salesmanship, it makes the world go around

#78 Looney Baloney on 08.02.17 at 9:40 pm

How HCG sausages were made

http://www.zerohedge.com/news/2017-08-02/exclusive-how-home-capital-sausages-were-made

#79 WUL on 08.02.17 at 9:44 pm

Chin up GTA Realtors! Fort McMurray beckons.

June (not July) YOY sales to date:

SFD + 73.68%
Duplex + 33%
Town + 39%
Condos + 77.5%

Take it from me. Ditch the Audi and lease a Ford F350 Duramax. Opt for the remote starter so you can finish your latte inside while the beast idles for 30 minutes filling the cab with Farenheits. Let it idle for the 4 hour open house too. Bring a parka.

#80 Damifino on 08.02.17 at 9:45 pm

#28 Gov Herd Protection

So what if your portfolio of stocks go up 20% – it does not compare to the hundreds of thousands of dollars when your house goes up 20%.
———————————–

Quite correct, it doesn’t compare at all. When your portfolio goes up 20% you have real wealth you can use immediately. If the portfolio is properly structured you get usable cash flow even if it doesn’t rise 20%

When your house goes up 20% you’ve got a more expensive house. Bully for you. You need to sell and invest properly at that point. But no one has the guts to do it so they just pretend to be wealthier as their carrying costs rise… up and up… forever…

#81 Smoking Man on 08.02.17 at 9:47 pm

How does the bond market always be a bit ahead of the July Treb numbers.

Batman bitches.

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

#82 Garth on 08.02.17 at 9:48 pm

You paint an anticipated fall in the TSX, yet………increased Canadian exposure at the expense of the US?

um, okay……

Where did I say the Canadian market would stumble? Meanwhile the US is at a record level, clearly with an element of over-valuation. But, invest as you want, chasing the winners. Good luck. — Garth

#83 Smoking Man on 08.02.17 at 9:53 pm

Never make a bet based on MSM

Talk to the herd and you will never lose.

Dr Smoking Man
PhD Herdonomics

#84 Willy H on 08.02.17 at 10:01 pm

Watch for new home builder (developer) bankruptcy’s in Ontario.

Particularly smaller players who have paid a premium for land now zoned for detached homes.

This blog rarely comments on the speculation taking place on farmland surrounding the GTA.

It’s a big part of the mess we are currently in.

#85 Shawn on 08.02.17 at 10:02 pm

I think the flat TSX YTD is forecasting a hit to GDP from housing in the coming months. It could simply mean that Canada lags other markets going forward.

Valuation is tough and often a poor indicator of leading, lagging markets / market tops. Sure stock market valuations were high at the 2000 top but they were also high in 1995.

I think US equity valuations became artificially low in the early 1980s because of high interest rates and are now artificially high because of low interest rates.

It’s true that the TSX is undervalued relative to the S&P500 as far as a forward P/E ratio is concerned. But forward P/E ratios are not static – the forward p/e for the TSX could rise if earnings decline due to a real estate decline.

#86 What about CMHC? on 08.02.17 at 10:02 pm

Realtor-Uber drivers – saw a few in YYC.

#87 Millmech on 08.02.17 at 10:06 pm

#23
Helping a friend move out of his house on the long weekend in Penticton,yes prices have gone up lately but not like you are hearing.He sold in June and the total price appreciation over nine years was a grand total of 15% or a gain of 1.6%/yr.This doesn’t include the usual property taxes and maintenance and upkeep fees.

#88 Adios on 08.02.17 at 10:08 pm

Re#22

Am I the only one tired of Happy Housing Crash?We all get it you hate realtors but seems to me you either failed the exams multiple times and missed out on the past winfalls or your just pissed off and tired of handing burgers to the realtors driving the Audis at the drive through window.Realtors exist but nobody forces you to believe in their advice or their views.Orders up!!!!!
Jealous much!

#89 Smoking Man on 08.02.17 at 10:09 pm

I spoke to Garth the other day. He’s like a girly version of Rob Ford.
He explained the balanced portfolio thing and risjed hedged approach.
I did some research, his apporch is good.

It works be it boaring a shit.

Going huge long on USDCAD

Globalists proping up T2 don’t have enough loot without Trumpster who is on the verg of defundING the UN
. Think of a stadium filled with mirror copies of Kathleen Wyeen
T2 You’re days are numbered. Expo stadium filled with fast track libralism voters.

#90 David on 08.02.17 at 10:11 pm

Fact check: since the changes last fall, estimate only a third (maybe less) of new mortgages are insured. no new refi gets insured. no investment props.

#91 WUL on 08.02.17 at 10:14 pm

My, what a summer. 100 km of Highway 93 closed from Eisenhower Junction (Banff Nat’l Park) to Radium, B.C. indefinitely due to wildfire smoke. The TransCanada will be real tough this long weekend with folks from Calgary taking the long route to Invermere, Windermere, Radium etc. I’m staying put.

#92 Sold out in Vancouver on 08.02.17 at 10:17 pm

#53 FOUR FINGERS WATSON

Congrats on your sale !
Now you can take your profits to many other areas of the Okanagan that are not on fire, and have had price reductions… I personally enjoyed the 18 years living in, and growing up in Penticton, and now since selling in Vancouver, after living here for 36 years, we may become neighbour’s !
Good luck to you and enjoy your new home !!!

#93 40 something family man on 08.02.17 at 10:26 pm

So my brother bought a 90 yr old shack in old Markham right around the peak (Apr 17) and bid a hefty $800k. It was a smart idea to finance the purchase with proceeds from his condo, but one small catch. The condo has been on the market for 2 months with ZERO bids. He closes on the new one end of AUG. Hope they can sell in time, or find a bridge loan, any recommendations? He did well on his condo, but the value of his new house has probably wiped out the profits. Sucks when its family.

#94 paulo on 08.02.17 at 10:27 pm

on the litigation issue; getting a judgement could be and is quite often very expensive, good litigation lawyers cost plenty, and despite what many seem to think the litigation courts are not accessible or affordable unless you have deep pockets.
a case such as deric’s a 500k claim could easily cost 50 to 75k to pursue to judgement in Ontario in the superior court of justice .
judgement does not mean payment! any honest litigation lawyer will tell you that enforcement of a order is the hard part. the dirt bag that walked on this deal will likely delay and drag out the outcome at deric’s expense while he/she sheds assets in preparation for a bankruptcy. it takes 4-6 years
in all likelihood deric will eat a big legal bill with no recovery or ability to enforce any judgement.

sellers of properties should be inserting clauses dealing with the possibility of purchaser defaults and failure to consummate the purchase/sale agreement, such as a clause reducing all commission payable to a broker or agent to a percentage of the deposit held in trust as a deposit with the balance deemed liquid damages to be due to the seller and subject to release upon evidence of a failed purchase and sail agreement ie purchasers failure to close the contract on the specified date .

#95 april on 08.02.17 at 10:31 pm

#88 – Yes!

#96 For those about to flop... on 08.02.17 at 10:32 pm

How much did this house go for ?

Or did they just pull it again to camping?

Someone give me the mail…

M43BC

1607 Balmoral Avenue, Coquitlam paid 1.3

Mar 29:$1,468,000
Jul 25: $1,099,000
Change: – 369000.00 -25%

https://www.zolo.ca/index.php?sarea=1607%20Balmoral%20Avenue,%20Coquitlam&filter=1

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAzWE5XRA==

#97 For those about to flop... on 08.02.17 at 10:37 pm

Hey while you guys are at it tell myself and my blog buddy LS what happened to this cat as well…

M43BC

Sold or removed

#128 LS in Arbutus on 07.29.17 at 9:45 am
FLOP – from my ‘hood.

2911 W 23 AVE.

Bought Aug 2014 $1.887
Bought Jun 2015 $2.228
Bought Jan 2016 $2.828

Now asking $3.000

Assessed $3.131

Most things in the ‘hood seem to be selling for at least 10% below assessed. So this will be loss, even before transaction costs.

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAwME1VSA==

https://www.zolo.ca/index.php?sarea=2911%20W%2023rd%20Avenue,%20Vancouver&filter=1

#98 april on 08.02.17 at 10:38 pm

#75 – Not “lots of over asking” however this always goes on at the end of a bubble and lots of building is not an indication of further price increases.

#99 Joe2.0 on 08.02.17 at 10:40 pm

Tesla=coal powered.
It’s not clean energy.

#100 For those about to flop... on 08.02.17 at 10:41 pm

What happened to this bad boy?

Sold or removed

3826 COAST MERIDIAN RD Port Coquitlam paid 1.2

Mar 1:$1,200,000
Jul 21: $1,149,000
Change: – 51000.00 -4%

https://www.zolo.ca/index.php?sarea=3826%20Coast%20Meridian%20Road,%20Port%20Coquitlam&ptype_condo=1&ptype_house=1&filter=1

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

#101 Keith in Calgary on 08.02.17 at 10:42 pm

They are called…….”econo misseds”………not economist’s.

#102 april on 08.02.17 at 10:43 pm

#73 – Read Ross Kay on Benchmark measurement of real estate.. or maybe Garth might explain.

#103 For those about to flop... on 08.02.17 at 10:45 pm

Did these guys do dough?

Old Bird are you still awake…

M43BC

3208 Euclid Avenue, Vancouver paid 1.95 ass 1.48

Jun 16:$1,977,675
Jul 12: $1,798,000
Change: – 179675.00 -9%

https://www.zolo.ca/index.php?sarea=3208%20Euclid%20Avenue,%20Vancouver&filter=1

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

#104 liquidincalgary on 08.02.17 at 10:48 pm

moved to someplace remote and exotic, like Regina.

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

well, that explains the watermelons…go Riders!

#105 Pete from St. Cesaire on 08.02.17 at 10:50 pm

“Canadians have no history of walking away from mortgage debt”
——————————————————-
More and more people are waking up to the fact that the whole monetary system is a fraud. They’ve seen the 2008 bailouts of those who didn’t deserve anything while leaving the homeowners to rot. Look at the comments on here. Notice how many people talk about: Jeckyl Island, the FED, the UCC, fiat money, their straw-man name, etc, etc, etc. These people aren’t the same know-nothings that comprised the former ‘Canadians’ who always felt that the system was on the side of good and justice. So, I’d be expecting many of the to simply throw up their hands and walk away so as to be able to get on with their lives. They know that no one actually suffers when they do so, therefore they have nothing to be ashamed of.

#106 april on 08.02.17 at 10:58 pm

a#73 – Still pumping real estate… according to Ross Kay a single family home in Vancouver is now at $968 thousand approx… forget exact amount, but not over 1 mil anymore. Can’t go by what the real estate industry spins to the public.

#107 Sold out in Vancouver on 08.02.17 at 10:58 pm

#87 Millmech

Thanks for your honesty, I’ve watched the market there, planning my exit from the GVRD on and off for 4 years. I know the truth. This spring was a wild ride up there, I saw prices I couldn’t believe…but since the floods in April/May, and now the fires. July was quiet, prices are reduced. Your friend sold at the perfect time. Hopefully their on to bigger and better things ! I am returning, I’m not sure why…but the Okanagan is calling. Soon I’ll be that grumpy old guy yelling at you kids to get outta my yard !!! All the best !

#108 Pete from St. Cesaire on 08.02.17 at 11:05 pm

I should add to my comment about people walking away from their mortgages: Think of all the students who are now realizing that they have been shafted; promised jobs that the govt shipped overseas and the teachers knew wouldn’t be there, then to add insult to injury they have been prevented from going bankrupt on their student loans thereby being treated like criminals (it used to be that only a debt incurred by criminal activity , or alimony, couldn’t be dismissed in bankruptcy). Many of the Millenials will see mortgage bankruptcy as both the only way to ever have a chance again in life and perhaps as a way to get back at the system that shafted them. And I say they should start filing their bankruptcies right away before the govt decides to change the rules; since changing the rules is what T2 has been doing as of late.

#109 Honest Realtor on 08.02.17 at 11:22 pm

I am just wondering, if now is a good time for real estate agents to disclose in writing to their clients if they work full time or part time?

#110 Yuus bin Haad on 08.02.17 at 11:23 pm

Relief hampers? How about vouchers for JavaScript programming lessons (just like the oil and gas people got) … I think that was Armine’s idea.

#111 Robert White on 08.02.17 at 11:35 pm

The BofC will raise rates again due to the fact that they must get wiggle room that parallels the Federal Reserve rate rise IMHO. CANADA cannot lag behind the USA when it comes to interest rates rises. Moreover, the Bank For International Settlements has been directing governments around the world to raise rates for 9 years to literally no avail. Are we to assume that the BofC will not adhere to the dictates of the BIS given that they seem to be mired in no elbow room at present? Shall we listen to the Corporatists that advocate for free money & easy money to the point of it sloshing around and reaping havoc? In my estimation, central banks have no choice but to continue raising rates in light of the decades of easy money that the Greenspan Put generated for the men that ruined the world with the repeal of the Glass-Steagall Act.

The BIS advisory is the only way to go, frankly.

#112 Ace Goodheart on 08.02.17 at 11:35 pm

Don’t know about your housing crash. Do know that you have to go stand by the Bradford Go Bus terminal at 6pm and figure out where all of those cars are coming from, heading up the road northwards.

That sort of thing is important, if you are a real estate investor.

Just like the poor dude in some third world country who figures out that if you put your vegetable stand at the city cross roads, you can get rich just on the amount of traffic that passes you every day.

Something funny is going on up there. When you get a constant line of cars four deep heading past, with no breaks, for about four hours each afternoon, passing tumbleweed covered abandoned houses and barns, well, you kind of feel like that poor old dude at the cross roads with his vegetables.

Life is about to get very good…….

#113 For those about to flop... on 08.02.17 at 11:43 pm

Stop the presses!

Forget about them other cases and make this your top priority!

This is one of the condos out in Richmond that I have been blabbering about.

Sold last week and they were on the hook for 3.13

Let’s see if people in the city are still on the jungle juice…

M43BC

Paid 3.13

Sold for???

501- 5131 Brighouse Way, Richmond

Dec 6:$3,990,000
Jun 10: $3,850,000
Change: – 140000.00 -4%

https://www.zolo.ca/richmond-real-estate/5131-brighouse-way/501

https://evaluebc.bcassessment.ca/Property.aspx?_oa=RDAwMDBLMkI4Vg==

#114 paracho on 08.02.17 at 11:50 pm

I keep driving by the same houses for sale . Those in my part of Woodbridge ( Vaughan ) Ontario and in surrounding neighbourhoods of Woodbridge and even Kleinburg and into Toronto. I am noticing the same houses. ( keep calm Tony the Gino…things are moving in your favour) …Same houses for sale ..months now . One was even mentioned here a few days back . Theere are signs on top of the signs which state ‘New Price” and “Reduced”. I think we are at the beginning of a correction..yes just the beginning as rates increase and new measures come into effect ( along with measures in China that are preventing money from leaving that country..still a variable, even if it is a minor variable )

#115 Small Business on 08.03.17 at 12:06 am

I have never personally had a problem with realtors.

Like any other industry there are some great, some good, and some awful people in the industry.

I remember doing a walkthrough on a home with an experienced agent and she pointed out to me potential problems and future expenses should I decide to buy the home that I missed. She could have just snowed me and said it was a great house and a great deal.

At the end of the day any increase or decrease in home prices can be placed squarely on the purchasers of the property in my view.

(No, my mother was not a realtor)

#116 Happy Housing Crash Everyone! on 08.03.17 at 12:13 am

HCG released terrible earnings. they are finished as a business. Buffet will be waking away with alot of toronto RE. Without fraud the GTA is finished.

In its earnings release late Wednesday, Home Capital warned that the recently proposed regulatory changes by the Office of Superintendent of Financial Institutions, including a required qualifying stress test for uninsured mortgages, could have a material impact on its business.

“If implemented as proposed, (it) would reduce, possibly materially, the size of the uninsured mortgage market available to the Company … The draft guideline would be expected to have a material impact on the Company’s business strategy going forward.”

http://business.financialpost.com/news/fp-street/home-capital-loss-bigger-than-forecast-but-says-troubles-are-resolved/wcm/10dcd67b-e0ef-4d98-9280-e55d11a0285e

Happy HAPPY Housing Crash Everyone! :-)

#117 LS in Arbutus on 08.03.17 at 12:19 am

FLOP – according to @hutchyman on Twitter

Sold for $2.990 at 95.5% of assessed value. (Most seem to sell 10% of more under assessed so they did a bit better.) Paid $2.828 in Jan 2016. So after PTT, realtor’s fees etc., *may* have just broke even after holding for just over 1.5 years.

——————————-

#128 LS in Arbutus on 07.29.17 at 9:45 am
FLOP – from my ‘hood.

2911 W 23 AVE.

Bought Aug 2014 $1.887
Bought Jun 2015 $2.228
Bought Jan 2016 $2.828

Now asking $3.000

Assessed $3.131

Most things in the ‘hood seem to be selling for at least 10% below assessed. So this will be loss, even before transaction costs.

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAwME1VSA==

https://www.zolo.ca/index.php?sarea=2911%20W%2023rd%20Avenue,%20Vancouver&filter=1

#118 NoName on 08.03.17 at 12:56 am

Former FBI Director James Comey has reached a multimillion-dollar book deal with Flatiron Books to pen an as-of-yet unnamed book on leadership.

“His book promises to take us inside those extraordinary moments in our history, showing us how these leaders have behaved under pressure,” Miller wrote. “By doing so, Director Comey will give us unprecedented entry into the corridors of power, and a remarkable lesson in leadership itself.”

http://www.politico.com/story/2017/08/02/james-comey-book-deal-241246

#119 Half Full on 08.03.17 at 1:14 am

Maybe relief pampers…

#120 FOUR FINGERS WATSON on 08.03.17 at 1:18 am

RE: mortgage defaults and bankruptcy. If you are really hooped and underwater u can declare bankruptcy. Then you have six years to save and build a new credit rating and away you go……

#121 FOUR FINGERS WATSON on 08.03.17 at 1:39 am

#92 Sold out in Vancouver

I still have a condo in Kelowna for when I visit my kids and grandkids but I would not recommend for anyone to retire here. It is waaay overpriced for what u get. The valley is always full of smoke in the summer and overcast like Vancouver in the winter. Very poor air quality for the sick and elderly. It is overcrowded and the traffic really sucks especially during tourist season. Too hot in the summer and too cold in the winter, there are better places to retire.

#122 poly on 08.03.17 at 1:42 am

#94 paulo…

right on! that’s probably the reality

#123 DON on 08.03.17 at 2:59 am

#52 young & foolish on 08.02.17 at 8:28 pm

People will walk away from their houses and mortgages and go where exactly? Across the street into a rental?
***************

Why not? Move back home? They will do what they need to when the meme changes and it’s everyone for themselves…who can get out first. Simple human nature. I know a bunch of people that are old and foolish buying big new trucks and cars and toys who can barely afford the monthlies.

#124 DON on 08.03.17 at 3:01 am

#60 For those about to flop… on 08.02.17 at 8:43 pm

That is a picture of Broadway Skytrain with the watermelons and he is going to make boatload of Pink Lemonade…

M43BC
************
Nice!

The real estate speculator / realtor that will never admit it.

#125 Dan.t on 08.03.17 at 4:33 am

“#18 OttawaMike on 08.02.17 at 7:00 pm
What other industry sees a surge of new “talent” balloon to 48k?

Can you imagine if everybody decided being a dentist or plumber or pilot was lucrative and the numbers swelled up to excess?

How can it remain such an easy field to join when you are essentially handling the life savings of a family in a transaction?”

————————————————–

People go where the money is and for 13 years every single government policy was lined up to turn Canadians into house horny Canadians.

So from 2004 once local “news” media started pumping RE and HGTV took off, it has been the easiest money and even if you lied, cheated, committed fraud, all good because everyone wanted what you are selling… and prices kept going up, so really, no one was hurt.

The practices that were allowed to go unpunished and ignored by those in power (shadow flipping, liar loans, shady marketing tactics, there was even a case a few years back when some “realtor” actually got someone else to write his exam (busted on it) but talk about low barriers to enter…

If there is any doubt about at housing bubble, 48k rushing in near the top should be a pretty good tell.

And like Canada has no subprime problems…they don’t as long as condo prices, and house prices just keep going up… buying stuff that goes up in value with no money is awesome! Ask anyone who bough zero down 40 year amortization in 2005-2006.

http://www.zerohedge.com/news/2017-08-02/exclusive-how-home-capital-sausages-were-made

and the “Happy housing crash” posts make my day. Keep it up. Can’t happen soon enough especially in BC…then what would everyone talk about?

And for the record, I have mentioned before how this plays out…won’t bother about cycles or economics (since fundamentals don’t apply during bubbles) but just like the media hooked every Canadian into participating in RE and RE speculation, now notice the headlines from yesterday.

http://www.cbc.ca/news/business/realtors-housing-market-1.4231913

http://www.cbc.ca/news/business/toronto-housing-analysis-1.4146492

http://www.cbc.ca/news/business/crea-housing-market-prices-1.4208256

All those articles in the business section…how about keeping those coming everyday for a year or two and then lets see how house horny Canadians are…so easy to brain wash the herd.

Wait a few years. Just like the front page 2004 BC “Province” “News” about Timmy buying a hip condo in YVR, because that of course is “news” worthy, and thousand of other RE sponsored puff pieces along the way,

we will have front page news of families picked in debt and speculators, blaming everyone but themselves crying for bailouts and how could the government let this happen….or maybe not, maybe YVR (and lower mainland) and GTA residence really can all afford 980k houses and 550k+ condos. Good for them.

Ok, I think I’m done my cheerful rant for today.

#126 jim on 08.03.17 at 5:34 am

Interesting… as I spend less and less time in Canada, I’ve drifted away from checking this blog. Yet on this rare occasion, what do I discover? The deflating Toronto bubble, which is so obvious that even the useless MSM is talking about it.

This should be quite fun to watch. The last time prices tanked in Canada was around the time of the GFC. The government stepped in with a host of interventions to keep the market propped up. The day of reckoning seems to have arrived.

Ah well, let others worry about that. I just picked up two rental houses in Allegheny County, which has one of the best cap rates in the USA. Affordable, not stellar returns but good enough to balance out the portfolio. The idea of spending a million on a single house that is negative in terms of cap rate is laughable.

Even though some US cities are in bubble territory, there is no glee here about rising prices. People remember. Canadians, on the other hand, are delusional fools. One of the most obvious problems with high housing is the impact on labour mobility, which in turn reduces employment opportunities and formation of new businesses. They don’t seem to realize that rising housing prices are not good on a macro-level. Well, they are about to find out what a reversion to the mean looks like.

#127 Stan brooks on 08.03.17 at 5:44 am

20-25 % decline in just 2-3 months, considering the inertia in the real estate markets is a lot.

The most steep and severe decline in house prices in GTA is a crash, not a mere correction.

Will we see 75 % decljne in GTA in real terms? Absolutely.

There is nothing BOC can do except to kill the loonue. The psychology of the market has changed and that is not coming back in the next 7-10 years.

#128 Stan brooks on 08.03.17 at 5:50 am

BTW the unwinding of the real estate superbuble will kill the economy and cause structural depression.

Extensive infrastrucure privatization to jt2 friends will not bring jobs back, on the countrary it will further increase cost if living, 1cad per killowat electricity and 7 cad subway tickets are coming, with no jobs in sight.

#129 Tim on 08.03.17 at 6:37 am

Hey Garth! Love the blog, read it almost every day but man it’s getting depressing. How about every Friday you post a good news article? There are a lot of us that have followed your guidance, lived within our means but based on your recent posts, it won’t seem to matter b/c we’re all screwed.

#130 Wrk.dover on 08.03.17 at 6:50 am

Garth et all:

Mother Earth well beyond menopause. Growth has been over ever since. Fly over the forest, see the dusty logging roads. If it weren’t for electronics there would be no fish catches. The farmland is overused. TSE peaked in February. Dow is all Ponzi. You made your money, now enjoy it. Find a chef, a bluesman and a raconteur to spend the days with. Spend the nights with your trusty wife. You are older now too.

Even Smoking Man knows how to party.

#131 simple person on 08.03.17 at 7:13 am

700k for a townhouse 30 minutes from Toronto is outrageous …it wouldn’t have fetched more than 300k prior to 2012.
One can get better deals 30 minutes from manhattan..
It seems to me that selling prices are more the result of a fantasy , they keep getting higher and higher.

#132 GFD on 08.03.17 at 7:39 am

HTG report performance burried as far as Cape Breton

http://www.capebretonpost.com/business/2017/8/2/home-capital-posts-111m-loss-in-first-earnings-report-since-buffett-life-line.html

#133 jess on 08.03.17 at 7:41 am

Part 1: When Chinese residents of Spain needed to get piles of illicit cash back home, police allege, they found an accomplice in the Industrial and Commercial Bank of China. Confidential court filings, including wiretap transcripts, detail how the bank allegedly helped launder hundreds of millions of euros.

By ANGUS BERWICK and DAVID LAGUE

Filed July 31, 2017, 11 a.m. GMT
https://www.reuters.com/investigates/special-report/icbc-spain/

#134 Happy Housing Crash Everyone! on 08.03.17 at 7:44 am

you dirty POS garbage high school drop out shysters.
https://www.thestar.com/business/real_estate/2017/08/02/richmond-hill-real-estate-brokerage-fined-250000-for-mishandling-trust-accounts.html

The government needs a major overhaul of this shady and often criminal profession. These shysters should be in jail. I hope shysters like this suffer for a thousand years.

#135 Honest Realtor on 08.03.17 at 7:54 am

I see the housing crash psychopath is at it again:

“…everyone wants to see the 43000 toronto shyster scream in horrible financial pain”

Hannibal Lecter was less disturbed than you.

I imagine you are hoping that hurricane season will kill thousands in Haiti this year as well.

One sick puppy…….

#136 jess on 08.03.17 at 7:55 am

“In a statement released in May last year, Spanish prosecutors said the giant Chinese state-run lender was a conduit for laundering tens of millions of euros in illegal funds from tax fraud and smuggling by “Chinese criminal organizations.” The sums laundered were so large, the prosecutors said, that “the damage to the socio-economic order and the national economy is clear.”

https://www.reuters.com/investigates/special-report/icbc-spain/

#137 Grey Dog on 08.03.17 at 7:57 am

Derek, thank you for sharing your “selling your home adventure”, your example illustrates that what a home listed for and what it actually SELLS for can be two different stories…it isn’t over, til the money is in YOUR bank account!

Good luck this time, be sure to update us dogs when all is complete.

#138 maxx on 08.03.17 at 8:10 am

“Relief Hampers for Re/Max. Who’s in?”

Not blinking likely.

They can all line up at the food bank.

#139 maxx on 08.03.17 at 8:20 am

#17 Victor V on 08.02.17 at 6:57 pm

“Canadian realtors brace for the end of the boom as housing market tightens

http://www.cbc.ca/beta/news/business/realtors-housing-market-1.4231913

…..”Fleming believes many agents are already making less than minimum wage once license, membership and brokerage fees are paid”

Which is exactly what most are worth.

#140 Alex k on 08.03.17 at 8:21 am

#57 ex-cowtown and to everyone that never paid attention or missed Math classes in school

On way up : $500,000 property doubles to $1,000,000
That is a 100% increase – are you with me?

On way down: that same property $1,000,000 goes down 50% back to $500,000 – no, it’s not magic, it’s called Math.

You see, now you wished you paid attention.

#141 maxx on 08.03.17 at 8:28 am

#18 OttawaMike on 08.02.17 at 7:00 pm

“What other industry sees a surge of new “talent” balloon to 48k?

Can you imagine if everybody decided being a dentist or plumber or pilot was lucrative and the numbers swelled up to excess?

How can it remain such an easy field to join when you are essentially handling the life savings of a family in a transaction?”

Because the extent to which Canuckleheads are useless at building wealth outpaces the adhesion rate of realtards.
Canuckleheads are generally gullible, greedy and jealous of each other. Always looking over the fence.
Bidding wars, keeping up with the Joneses and servicing their egos make for a hell of a lot of profit.
Always have and always will.

#142 fixie guy on 08.03.17 at 8:29 am

“It is one of the fastest market unwindings in history – and the bottom is yet unknown.”

Barring federal intervention to reinstate policies funneling money to financial industries through real estate, not much mystery. Prices will revert to inflation adjusted historical norms pre-Chretien’s first dabble with the CMHC. The Toronto Teranet HPI was around 70 in 1998, currently around 250.

#143 crowdedelevatorfartz on 08.03.17 at 8:31 am

@#36 Investors Friend

“Derek…
Will have his day in court and the Realtor might face suspension for unprofessional conduct.’

******

Do you actually believe that a “realtor” who has illegally reneged on a houseflip, who has “ran and hid” from the aforementioned houseflip… will stick around?

I would suggest to Derek that he scour all the coffee shops for the barrista/realtor hiding in plain sight.
A $500k Court ruling in your favour is certainly worth winning…..just dont count the 500,000 eggs from a bankrupt realtor amounst thousands quite yet

#144 nick on 08.03.17 at 8:36 am

July Numbers out! See summary

https://i.imgur.com/lVBXsVC.png

#145 crowdedelevatorfartz on 08.03.17 at 8:37 am

@#135 Honest? Realtor? WTF?
“I imagine you are hoping that hurricane season will kill thousands in Haiti this year as well….”
********

No he only wishes the unemployed realtors from Haiti would stop showing on the Quebec border by taxi because……we already have enough realtors…..

http://www.google.ca/url?url=http://www.cbc.ca/news/canada/montreal/olympic-stadium-opened-to-temporarily-house-intense-surge-of-asylum-seekers-from-u-s-1.4231808&rct=j&frm=1&q=&esrc=s&sa=U&ved=0ahUKEwjmj8SKirvVAhVH0mMKHV02D_sQFggcMAI&usg=AFQjCNERXKKsoNN6t_U2U2n1NH4w-ZUfmA

#146 Prairieboy43 on 08.03.17 at 8:44 am

CBC must be following your blog.

http://www.cbc.ca/news/canada/british-columbia/buyer-who-walked-away-from-real-estate-deal-ordered-to-pay-360k-1.4232844

PB43

This should not be news. It is the outcome of breaking a contract. — Garth

#147 Quotable Quotes on 08.03.17 at 8:47 am

“I learned long ago, never to wrestle with a pig. You get dirty, and besides, the pig likes it.”
— George Bernard Shaw

“Sometimes you will never know the value of a moment, until it becomes a memory.”
— Theodor Seuss Geisel

“I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.”
― Maya Angelou

#148 crowdedelevatorfartz on 08.03.17 at 8:50 am

@#91 WUL
“tough this long weekend with folks from Calgary taking the long route to Invermere, Windermere, Radium etc.”
******

Yep. Not much view of scenery there what with the other fire durning south of Fairmont Hot Springs at Canal Flats. Both that fire and the Hwy 93 fire are zero percent contained.

I’ll just stay here in the lowerbrainland and huff thick smoke and watch the fireworks….”cough” cough”

#149 Bonhomme Carnaval on 08.03.17 at 8:51 am

@ #125 Dan.t on 08.03.17 at 4:33 am

Thanks for your rant! Well said.

@ #127 Stan brooks on 08.03.17 at 5:44 am
@ #128 Stan brooks on 08.03.17 at 5:50 am

Wow. I couldn’t of said it better myself!

However, will T2 survive 2019? At this rate, houses will be free in Toronto by then. Lots of people will be angry.

Question: What ever happened to ‘all real estate markets are local’ ?

All markets in Canada will not correct at the same time. Moreover, they will not correct by the same %. In addition, too many variables to consider, i.e. if new conflict in the Middle-East arises, and it sends oil shooting up; that will stimulates AB’s economy (?).

Here in QC the government has already announced, and will likely be announcing more, massive infrastructure projects, i.e. new Mercier bridge, L.-H. Lafontaine Tunnel renovation, REM light-rail project in partnership with CDP Capital-Infra, possibly new Métro-line extensions, etc.

Toronto’s and Vancouver’s predicaments are not Canada’s problems. Toronto’s not New York, and Vancouver’s not Shanghai.

That being said, the Leafs are doing a better job, than the Canadiens, building a Stanley Cup contender.

#150 paulo on 08.03.17 at 8:52 am

#93 40 something family man:

sorry to hear of your brothers predicament, he has plenty of company in this situation
recommendations: be very proactive get his financing ducks lined up asap, assume he will be carrying both for a period of time
hopefully he has the resources to close or can obtain same.
make a exit plan; where does he want to live the house or the condo if its the house adjust the ask price on the condo to move it quickly either way plan to divest one of the properties
personally i would concentrate on keeping the house
it has better future prospects-dirt under foot as opposed to gta condo likely to equate to dirt over foot for many before the ride is over
good luck, hope it works out.

#151 SilverSon on 08.03.17 at 8:55 am

#99 Joe2.0 on 08.02.17 at 10:40 pm

Agreed. Carbon emissions still exist as a result of these vehicles even though there’s no tailpipe – they are at the power generating stations whether they be coal or natural gas. And when charging these cars, nobody can trace whether they were consuming electricity purchased from the US (where they still burn coal) or generated in Canada (where they burn natural gas). Charge from your own wind or solar farm then sure, there’s no carbon. But that’s only part of it. Imagine the extent of environmental problems that would be created by a few million expired electric vehicle or hybrid vehicle batteries. Even recycling them will have a large environmental impact. Can’t believe they give away incentives (taxpayer money) to people buying overpriced EVs and hybrids – they are no better than an economical gas-powered car. Yippee they have a different motor – big deal. They still have tires, shocks, brakes, windows, etc that all have their environmental impact when being made and when being disposed of. And the added weight of carrying around all those batteries will make the car consume tires, brakes, and suspension components faster than an equivalently sized gas vehicle. People act like electric cars can defy physics or something. Crazy.

#152 Penny Henny on 08.03.17 at 8:59 am

#1 nick on 08.02.17 at 6:31 pm
first

————————-

Sorry nick but Jimmy is still the king.

#153 CJBob on 08.03.17 at 9:05 am

#88 Adios on 08.02.17 at 10:08 pm
Re#22

Am I the only one tired of Happy Housing Crash?We all get it you hate realtors but seems to me you either failed the exams multiple times and missed out on the past winfalls or your just pissed off and tired of handing burgers to the realtors driving the Audis at the drive through window.
_______________________
I’m pretty his spouse left him for a realtor who is making lots of money and enjoying a happier life. Sad really.

Now used car salesmen, don’t get me started ;-)

#154 Toronto on 08.03.17 at 9:08 am

Year over year as of end of July prices in Toronto have increased 17%. Outlier territory . Real estate doesn’t appreciate at such a rate .

If folks think you’ll be able to buy a Detached home in Toronto for $400, 000? Got news for ya – you’ll
Be renting for life

Y/y numbers are meaningless in the teeth of a correction. Detached prices are down 17.4% since April and sales crashed 48% in 905. It’s over. — Garth

#155 NoName on 08.03.17 at 9:35 am

#151 SilverSon on 08.03.17 at 8:55 am

Plug in hybrid cars are good, pure gas or pure electric not so.
And as for rebate, who is biggest power producer in Canada, “they” have put something in place to replace tax loses on a gasoline because cars are getting more and more efficient. Hybrid car gives you flexibility, while pure electric no so, at leas for now. its funny noone mentions how electric car range drasticly decreases as temperature flactuate in a plus and minus…

https://www.insidescience.org/video/extreme-weather-affects-electric-cars-range

In my opinion last generation of outgoing technology is a 100x better than 1st generation of incoming technology. Stick with gas and change oil (synthetic) every 17k not every 5 as mechanic say.

#156 maxx on 08.03.17 at 9:37 am

#47 TurnerNation on 08.02.17 at 7:57 pm

“Simply, introduce a species hostile toward Realtors. Enter, rabidly posting Blog Dogs.
They’ll be specious.”

That’s rich.

A perfect example of “specious” would be a realtard’s modus operandi. Simply introduce a nation’s worth of financial morons and voila! Riches galore for simply wagging that seemingly sensible tongue……and that’s not even the main reason most blog dogs are hostile. (The balance being mainly realtard shills)

It’s the incessant, obvious bs that constantly squeezes outta them. The lying, the misrepresentation via frankenstats, the conniving, emotional manipulation through instilling fear, the orchestration of bidding wars…..

That’s what these despicable jerks will be remembered for.

Shame there are not more examples of realtards screwing each other over on houses such as Derek’s.

#157 For those about to flop... on 08.03.17 at 9:49 am

#135 Honest Realtor on 08.03.17 at 7:54 am
I see the housing crash psychopath is at it again:

“…everyone wants to see the 43000 toronto shyster scream in horrible financial pain”

Hannibal Lecter was less disturbed than you.

I imagine you are hoping that hurricane season will kill thousands in Haiti this year as well.

One sick puppy…….

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

Stop yer whining and tell me what the 3.5million dollar condo out in Richmond at post 113 went for.

Do some good,you know you should…

M43BC

#158 Counting down.. on 08.03.17 at 9:51 am

Sold in April but made the mistake of allowing a long closing for the middle of August. We still have 12 more days to go and haven’t heard anything from the buyer even though lawyers from both sides are talking. Will she walk? Counting down now……..

#159 For those about to flop... on 08.03.17 at 9:53 am

LSat 12:19 am
FLOP – according to @hutchyman on Twitter

Sold for $2.990 at 95.5% of assessed value. (Most seem to sell 10% of more under assessed so they did a bit better.) Paid $2.828 in Jan 2016. So after PTT, realtor’s fees etc., *may* have just broke even after holding for just over 1.5 years.

——————————-

#128 LS in Arbutus on 07.29.17 at 9:45 am
FLOP – from my ‘hood.

2911 W 23 AVE.

Bought Aug 2014 $1.887
Bought Jun 2015 $2.228
Bought Jan 2016 $2.828

Now asking $3.000

Assessed $3.131

Most things in the ‘hood seem to be selling for at least 10% below assessed. So this will be loss, even before transaction costs.

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAwME1VSA==

https://www.zolo.ca/index.php?sarea=2911%20W%2023rd%20Avenue,%20Vancouver&filter=1

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

Thanks LS,Yeah that one appears to be a Pink Draw.

On to the next one…

M43BC

#160 Joanne on 08.03.17 at 9:57 am

The TREB is doing everything they can to cover up what’s happening in the market. They’ve adjusted how they report data in their one page news releases… It’s unethical. Why aren’t the big papers covering this – price drops and unethical reporting by TREB? Talk to anyone and they still think prices are going up. People need a clear understanding of the risk they’re taking on before purchasing a home, especially at these elevated prices. I’m so thankful we sold our detached home in 416 earlier this year!

Latest TREB release has dropped all the key data about sales & prices by housing category. Shameless. — Garth

#161 chopstix on 08.03.17 at 10:17 am

”As Toronto rents near Brooklyn-level prices, tenants grow desperate
Apartment-seekers are driving the streets looking for rentals and creating web profiles, similar to dating bios, to attract landlords.”
https://www.thestar.com/business/2017/08/02/as-toronto-rents-near-brooklyn-level-prices-tenants-grow-desperate.html

#162 chopstix on 08.03.17 at 10:19 am

”Who has the right to thrive in Toronto? Micallef
Anti-housing sentiment isn’t a right or left thing, it’s a Toronto thing. And the message is harmful.”

https://www.thestar.com/news/gta/2017/07/21/who-has-the-right-to-thrive-in-toronto-micallef.html

#163 Ian on 08.03.17 at 10:21 am

Look at this piece of crap going in Meaford ON for 970k. How can this even be worth 300k?!?! w…t…f

https://www.point2homes.com/CA/Home-For-Sale/ON/Meaford/205731-26-HWY/43249716.html

#164 Stan Broock on 08.03.17 at 10:27 am

Y/y numbers are meaningless in the teeth of a correction. Detached prices are down 17.4% since April and sales crashed 48% in 905. It’s over. — Garth

————————

Correct, the meaningful numbers are here (from the normally hottest spring and early summer months for real estate sales):

Toronto home sales tank 40 per cent, prices down nearly $175,000 since April

https://ca.finance.yahoo.com/news/newsalert-toronto-home-sales-drop-111044856.html

#165 what's over? on 08.03.17 at 10:27 am

real estate appreciates over time in major urban areas

the cost of a detached in toronto (hogtown…:)…) for $400,000 IS OVER, i agree. ship sailed

#166 Grantmi on 08.03.17 at 10:35 am

#154 Toronto on 08.03.17 at 9:08 am
Year over year as of end of July prices in Toronto have increased 17%. Outlier territory . Real estate doesn’t appreciate at such a rate .

If folks think you’ll be able to buy a Detached home in Toronto for $400, 000? Got news for ya – you’ll
Be renting for life

Spoken like either a true real estate agent.. or a home owner that bought in the last 12 months.. and his/her sphincter is starting to pucker up!

#167 wow on 08.03.17 at 10:40 am

”As Toronto rents near Brooklyn-level prices, tenants grow desperate
Apartment-seekers are driving the streets looking for rentals and creating web profiles, similar to dating bios, to attract landlords.”
https://www.thestar.com/business/2017/08/02/as-toronto-

………

and here i thought renting was cool? OUCH

Realtor troll. — Garth

#168 Stan Broock on 08.03.17 at 10:46 am

Latest TREB release has dropped all the key data about sales & prices by housing category. Shameless. — Garth

————————
Looking for moral or shame in hardcore crooks, whose job depends on lying is wrong.

Where is statistics Canada/Ontario here to give us unbiased numbers?

shouldn’t the government be targeting real-turds instead of doctors?

#169 Tulips on 08.03.17 at 10:50 am

Surrey has its own version of Derek.

https://www.google.ca/url?sa=t&source=web&rct=j&url=http://www.cbc.ca/news/canada/british-columbia/buyer-who-walked-away-from-real-estate-deal-ordered-to-pay-360k-1.4232844&ved=0ahUKEwimhrTUprvVAhUD9WMKHUUiBnMQqQIIJSgBMAA&usg=AFQjCNH7VSZE5oYM7bHGz2j_KUJ8KxWRcg

#170 nick on 08.03.17 at 10:55 am

#155 NoName

“noone mentions how electric car range drasticly decreases as temperature flactuate in a plus and minus…”

Its talked about all the time. The reason why its not a big deal is because real world effects on range are minimal (10-20%). If you have a car with decent range (200miles+) then its generally a non-factor.

#171 ShawnG in TO on 08.03.17 at 11:08 am

#153 CJBob on 08.03.17 at 9:05 am
#88 Adios on 08.02.17 at 10:08 pm
Re#22

blah blah
———–
Yo Happy Housing Crash Everyone!

you are getting hate mail

congrats!!

you are hitting the nails on the head
you are hitting a nerve
you are causing PAAAAIIINNNN !

keep up the good work

#172 SilverSon on 08.03.17 at 11:12 am

#155 NoName on 08.03.17 at 9:35 am

“In my opinion last generation of outgoing technology is a 100x better than 1st generation of incoming technology.”

Excellent point. I shouldn’t overlook the years of refinements that have benefited gas-powered cars when alternatives haven’t had the benefit of that much time.

But still not sure about hybrids over the long haul – double the engines to build, maintain, carry around for 150,000 miles, and then eventually dispose of. More activity to coordinate by computer as well which adds to the components and infrastructure required to build the car (and eventually dispose of). Pure electric has only an electric engine (or two if AWD) and internal combustion cars only have one. Two of something slightly better isn’t often better than one of something slightly worse so one form of propulsion per car makes more sense to me than two.

Don’t get me wrong – I like electric and hybrid vehicles – it just seems to me that they only change the location and timing of the environmental problems that they cause. Can’t really see how they reduce the environment problems in the long run. Actually thinking but getting a Tesla myself but if I do I’m simply going to tell people it’s because I like it instead of claiming it’s for the environment. Anyone truly wanting to save the environment would alter their lifestyle so they wouldn’t need a car at all, and since I’m not going to do that, saying that buying an electric or hybrid car to save the environment (knowing what I know about them) is a lie in my mind.

#173 Another Deckchair on 08.03.17 at 11:13 am

Re: Electric cars.

Hope this link is not a duplicate, but Euan Mearns and friends have done a great deal of in-depth investigation and writing, not “fluff” by any means.

http://euanmearns.com/co2-intensity-of-electric-cars/

My long-term take on this is that, really, we need to ban cars altogether. Fat chance, though… :-|

#174 willia told on 08.03.17 at 11:18 am

“Canadians have no history of walking away from mortgage debt.”

Profoundly full of shit.

Early 80’s, interest rates jacked shy high, people walked. LOTS OF THEM!

Foreclosures all over the place.

Whatcha smoking?

Statistically incorrect. Check the numbers. — Garth

#175 NoName on 08.03.17 at 11:29 am

rent is to damn high

https://www.youtube.com/watch?v=79KzZ0YqLvo

https://www.youtube.com/watch?v=Gg5SwyTvAHw

(funy thing song was made in brooklin)

#176 Grantmi on 08.03.17 at 11:32 am

#158 Counting down.. on 08.03.17 at 9:51 am
Sold in April but made the mistake of allowing a long closing for the middle of August. We still have 12 more days to go and haven’t heard anything from the buyer even though lawyers from both sides are talking. Will she walk? Counting down now……..

Hope you got a big deposit!!!

#177 TheDood on 08.03.17 at 11:36 am

#154 Toronto on 08.03.17 at 9:08 am
Year over year as of end of July prices in Toronto have increased 17%. Outlier territory . Real estate doesn’t appreciate at such a rate .

If folks think you’ll be able to buy a Detached home in Toronto for $400, 000? Got news for ya – you’ll
Be renting for life
__________________________________________

Maybe! But the investment portfolio (built largely through renting, and NOT buying real estate) will grow, and grow, and grow, and grow. Then one day, a magic number is going to appear on the monthly statement, and all financial worries and stresses will disappear forever.

Meanwhile, the lemmings buying overpriced real estate can spout off all they want about equity and their huge new shack, the fact is most of them are in debt for the rest of their life……………………….

Now release the hounds Smithers! And have the Rolling Stones killed!

#178 Lillooet, BC on 08.03.17 at 11:49 am

#94 paulo on 08.02.17 at 10:27 pm

judgement does not mean payment! any honest litigation lawyer will tell you that enforcement of a order is the hard part. the dirt bag that walked on this deal will likely delay and drag out the outcome at deric’s expense while he/she sheds assets in preparation for a bankruptcy. it takes 4-6 years
in all likelihood deric will eat a big legal bill with no recovery or ability to enforce any judgement.

****************
Will this scenario entourage some buyers walk away from a deal?
How often does this happen?

#179 Lillooet, BC on 08.03.17 at 11:49 am

WUL:

Any comment on #94?

#180 IHCTD9 on 08.03.17 at 11:49 am

#157 Ian on 08.03.17 at 10:21 am
Look at this piece of crap going in Meaford ON for 970k. How can this even be worth 300k?!?! w…t…f

https://www.point2homes.com/CA/Home-For-Sale/ON/Meaford/205731-26-HWY/43249716.html

——-

Some tricky camera work there, I’m betting the photographer did a lot of backing into corners and squatting. There’s not an 8′ ceiling in that whole place. In fact the upstairs aren’t even 7′. If I wanted to skip rope up there, I’d be smashing my head through the drywall. Must have been a big sale on white paint somewhere.

Tons of work done to this house, inside and out. I might consider an offer of 300K for it. It still has a long way to go before it has any curb appeal. That front door belongs on a 70’s bungalow, needs a big wrap around veranda, some real landscaping.

For near a million bucks, this place needs a total revamp inside and out, it can’t be just a ho hum farm house.

Who wants to bet the cellar is an untouched period-correct dungeon?

#181 TurnerNation on 08.03.17 at 12:02 pm

All this BS talk about sustainability means them talking away the means of production from us.
Independence out, reliance upon UN Global Nanny State, in.
Take EVERYTHING said by our elite rulers and flip it around to make sense.
Sign the confession they will place in front of you.

Condos will go in place of course.

http://www.cbc.ca/beta/news/canada/toronto/yonge-businesses-tax-increase-1.4233145

#182 Oakville Stinks on 08.03.17 at 12:07 pm

What about the TREB Competition Tribunal Court Ruling?

That’s another factor that will surely help with the decline. The decision should be coming in the fall just before/after the interest rate hike!

#183 Rexx Rock on 08.03.17 at 12:07 pm

Gta will come back just like Victoria had a slowdown a few years ago.Now Victoria is roaring back with strong wage growth and low inventory.Homes will be out of reach for new home buyers because of income and rich immigrants coming to Canada by 300,000 a year not including investors.There still is money to be made in condos but not like before when it was like a lottery.

#184 westcdn on 08.03.17 at 12:30 pm

Somebody asked – who was Canada’s longest serving PM?

William Lyon Mackenzie King. We were lucky to have him despite the critics of his personal life. T2 does not hold a candle to him.

https://en.wikipedia.org/wiki/William_Lyon_Mackenzie_King

#185 jess on 08.03.17 at 1:02 pm

“intelligent “? that depends

intelligent deposit machines, a type of ATM launched in 2012, which allows customers to anonymously deposit and transfer cash, even when banks are closed.

Austrac alleges the machines were used by four money laundering syndicates, including three linked to drug importation and distribution networks.

The syndicates used the machines to deposit and transfer cash, often at amounts just low enough to avoid arousing suspicion.

One money laundering operation saw more than $21m deposited into 11 CommBank accounts between February 2015 and May 2016, most of which came through the intelligent machines.

AUSTRAC seeks civil penalty orders against CBA
3 August 2017

Australia’s financial intelligence and regulatory agency, AUSTRAC, today initiated civil penalty proceedings in the Federal Court against the Commonwealth Bank of Australia (CBA) for serious and systemic non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act).

AUSTRAC acting CEO Peter Clark said that this action follows an investigation by AUSTRAC into CBA’s compliance, particularly regarding its use of intelligent deposit machines (IDMs).

AUSTRAC’s action alleges over 53,700 contraventions of the AML/CTF Act. In summary:

https://www.theguardian.com/australia-news/2017/aug/03/commonwealth-bank-accused-of-money-laundering-and-terrorism-financing-breaches

#186 paulo on 08.03.17 at 1:05 pm

#178
FYI would you try to pay a 500K judgement with no assets or pull a bankruptcy to expunge the debt?.

i do paralegal work on a side gig basis for a couple of solicitors in my home town Barrie Ontario and can tell you that closing defaults are epidemic, the domino effect is starting to show up, i would estimate that 20% of cases have already seen the respondent file bankruptcy. the courts are being overwhelmed with cases related to failed real-estate deals. it will likely take years 4-6 to complete a superior court statement of claim currently in Ontario…
so in response to your question: yes many purchasers that fail to close will choose the bankruptcy angle to get out of the deal.
if you are a seller that has been stung,you are best to try to negotiate a reasonable damages settlement with your defaulting purchaser,a out of court settlement and move on.

#187 NavyGunner on 08.03.17 at 1:10 pm

Another one was bitten:
http://www.cbc.ca/news/canada/british-columbia/buyer-who-walked-away-from-real-estate-deal-ordered-to-pay-360k-1.4232844

#188 mike from mtl on 08.03.17 at 1:11 pm

#149 Bonhomme Carnaval on 08.03.17 at 8:51 am

Here in QC the government has already announced, and will likely be announcing more, massive infrastructure projects, i.e. new Mercier bridge, L.-H. Lafontaine Tunnel renovation, REM light-rail project in partnership with CDP Capital-Infra, possibly new Métro-line extensions, etc.

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

I hope you’re being sarcastic, public works projects here have, say, a history rife with corruption and incompetence. The usual crooks will for sure be involved.

Fully expect any of these (if ever actually started) to take at least twice as long, cost five times as much and when complete, done poorly.

#189 Ian on 08.03.17 at 1:16 pm

I found the perfect contrary indicator, dogs!!!

Tim Hudak joining OREA as their president. That was a ‘leading indicator’ that the top was in.

https://www.orea.com/News-and-Events/News-and-Press-Releases/Press-Releases/May-3-2017

This first paragraph is unbelievable. ‘the only way to do this is increase housing supply’…right Tim. Or, maybe have the country have a slightly less than 436% debt-to-GDP ratio.

#190 SilverSon on 08.03.17 at 2:01 pm

#173 Another Deckchair on 08.03.17 at 11:13 am

That’s a pretty decent article but it’s overlooking stuff. Understandable because when you think about the whole picture the math to quantify it would get positively mind numbing. Still, the writer could have mentioned these things qualitatively. The article as it’s written is a good start of the absolute best case scenario for electric vehicles, but there are things that undoubtedly make them worse than illustrated in the article.

First thing the article doesn’t mention is countries that routinely purchase electricity from their neighbors. Canada (non-coal burning) routinely buys electricity from US (coal burning). Canada’s carbon emissions from electricity production should include a component that indicates how much juice they buy from the US which has a much higher carbon output. Then the EV (Electric Vehicle) picture isn’t quite as rosy for Canada, albeit still better than the US.

Second is that it doesn’t take into account maintenance over the lifespan of the car, and then it goes on to consider the lifespans are equal which cannot be proven. The article assumes a car’s lifespan is 200,000 kms which might be true for EVs, but not ICE (Internal Combustion Engine) vehicles which commonly make it to 300,000 to 400,000 kms. Sure, some people might not own a car past 200,000 kms, but they will definitely want to trade it in or otherwise sell it to get some money out of it (and then someone else will drive it beyond 200,000 kms). Does an EV need a new battery at 200,000 kms? I don’t know, but it will someday. Then when you consider how much carbon is tied up in an EV battery, the EV’s total carbon emission jumps up the moment you change its battery which adds to its gCO2e/km. Worse yet, if nobody is willing to replace the battery at its $6000+ price tag, the car would have to be scrapped at that 200,000 kms, at which point someone somewhere buys a new car instead of a used one. Relative to an ICE vehicle that would go to 300,000 kms or 400,000 kms, this means it takes between 1.5 to 2 times as many EVs to provide the lifespan of one ICE vehicle. Factoring that in, one could claim the total carbon emitted by the EV should be 150% to 200% of what it is for purposes of comparison with ICE vehicles.

Stuff like that is what makes me think EVs or hybrids aren’t the answer. They just look like they might be because we haven’t witnessed their long-term impacts nearly to the extent that we’ve witnessed those of ICE vehicles. The only thing conclusive I can see in all this is in this point that Another Deckchair made:

“My long-term take on this is that, really, we need to ban cars altogether. Fat chance, though… :-|”

Too bad so much of our economy hinges on cars … and RE.

#191 SilverSon on 08.03.17 at 2:13 pm

#188 mike from mtl on 08.03.17 at 1:11 pm

Well put mike from mtl. Public works projects are most commonly just crooks bilking government/taxpayers. The companies that get the work will be the ones that are the best at working the system to gain unprecedented profits, not the best at doing the actual work. These projects don’t stimulate the economy, they only stimulate the income of a handful of individuals.

#192 nickels on 08.03.17 at 2:15 pm

This burns me. He should be entitled to at least the next lowest offer that the 2.2 million offer beat out. That is what the dickheads screwed him out of if they never showed up in the first place. I hope they track the bastards down.

#193 nickels on 08.03.17 at 2:16 pm

this is what drive murder rates. the POS will rot in hell.

#194 Mike in Edm on 08.03.17 at 2:20 pm

Chin up GTA Realtors! Fort McMurray beckons.

June (not July) YOY sales to date:

SFD + 73.68%
Duplex + 33%
Town + 39%
Condos + 77.5%
************************

Ummmmm, you do realize a year ago from June most people in Fort McMurray still were barely just allowed to return to their homes, right? Ft Mac was an economic dead zone for many months after the fire.

It’s still absolutely brutal. The price drops up there are nearly as bad as the GTA

#195 paracho on 08.03.17 at 2:20 pm

Thank you #196 paulo….
I see this trend also . Many will try to walk away leaving the seller stung. But courts take long and can backfire ..with the court costs and all. I think the best solution would be to be reasonable and talk to the buyer. Courts should only be the last resort option.
I think we will se more deals falling through and more court cases, plus increased bankruptcies in the coming years.

#196 Bonhomme Carnaval on 08.03.17 at 2:24 pm

@ #188 mike from mtl on 08.03.17 at 1:11 pm

What does that have to do with the price of fish?

Corrupt or not, money is and will be flowing into the economy. That’s all that matters.

Since when have blog dawgs become such alter-boys and girls?

C’mon Mike, the source of problem is that the salaries (and benefits) given to engineers at the ‘ministère des Transports, de la Mobilité durable et de l’Électrification des transports’ that supervise the work are notoriously low compared to private sector gigs. Also, there’s been a hiring freeze since Lucien Bouchard was Premier.

Hire more engineers, pay them competitive salaries, and you’ll reduce costs by 10-15%.

The other issue, in QC trades people can only carry one competency card. Unlike the RoC where you’re allowed to have two. Another 10-15% drop in cost.

#197 Bonhomme Carnaval on 08.03.17 at 2:33 pm

@ #191 SilverSon on 08.03.17 at 2:13 pm

You’re right, ports, airports, bridges, subways, commuter train line, highways, not necessary for a First World economy.

Be well sir,

#198 jess on 08.03.17 at 2:33 pm

http://www.cbc.ca/news/canada/british-columbia/buyer-who-walked-away-from-real-estate-deal-ordered-to-pay-360k-1.4232844

#199 bdwy sktrn on 08.03.17 at 2:43 pm

“for those about to flop, we salute you”.

– re brighouse – yes just sold. 3.0m

who the flop would want to live in godforsaken rmd? shoot me first.

according to the o-fish-awl system last sale was in 2015 for just under that. 2.95ish

so a luxury condo in sad, flat richmond, that prob went from brand new to used and soiled, with a new 15% tax added, didn’t go up or down over a two year period. too bad for some guy in guangzou. oh well.

ok, you found a weak spot. does that cancel out the fact that decent, finished, sfh in east van are still at/over 2m, way way up over two years ago?

don’t see then going down significantly without another major global crisis.

#200 maka on 08.03.17 at 2:44 pm

Happy Housing Crash Everyone!

Greater fools should hang that sign on their front door :)

Do they sell it at premium dollar shops?

Happy Housing Crash!!!

#201 bdwy sktrn on 08.03.17 at 2:45 pm

DON – you sound like a cry-baby. “waaah, he’s a realtor “(whatever the F that means)
you missed the boat in victoria, van, and likely you can’t even afford up island. so you bitch here.

#202 bdwy sktrn on 08.03.17 at 2:54 pm

The real estate speculator / realtor that will never admit it.
————-
well maybe you are half right.

in 2009/10 i was strongly advised to sell all my 604 properties, you know why ….overvalued to fundamentals/overweight in RE/rates to rise/no china cash

i speculated by not selling them.

this is why i have no job and the wife too very soon. we’ll stop by smokeys LSD/ice cream shop on the dinghy in Caribbean where i plant to spend a few good years. (ever buy 5000l of diesel in a single fillup?)

i’ll be thinking of you, don ;)

#203 Rexx Rock on 08.03.17 at 3:00 pm

Looking for a good investment might be rental properties in Montreal area.Convert big houses to boarding houses.Lots of refugees coming daily from USA.Guaranteed rent from goverment,looks very promising with open door border policies!

There is no open door to Canada. — Garth

#204 TurnerNation on 08.03.17 at 3:16 pm

It’s over – free enterprise. Condos only.

“The increase is based on the potential value of the land. For small business owners that means if a 40-storey condo is built next door, they are taxed as if they had a 40-story condo.”

https://www.thestar.com/news/gta/2017/08/03/500-per-cent-property-tax-increase-will-change-the-face-of-yonge-st-keenan.html

#205 NoName on 08.03.17 at 3:19 pm

#180 IHCTD9 on 08.03.17 at 11:49 am

No trickery just extra wide camera lens, and tripod.

What bother me when they make hdr images of inside and outside, and on top of that they pull.mid tones out, and whole place looks alice on wonderland surial.

#206 Rainclouds on 08.03.17 at 3:38 pm

#182 Oakville “What about the TREB Competition Tribunal Court Ruling?That’s another factor that will surely help with the decline. The decision should be coming in the fall just before/after the interest rate hike!”
—————————————————————–
Not so fast. This is Canukistan. Much more time required…….10 years so far with yet another appeal likely to the Supreme Court(If they hear it)

Think 2020 IF we are lucky……

Probably 3 More years of Industry generated lies (that could be neutered by one single decision that should have been rendered YEARS ago….)

#207 SilverSon on 08.03.17 at 3:45 pm

#197 Bonhomme Carnaval

I think you misinterpreted my comment. Was talking about the contractors that will be hired (further to what I quoted from mtl mike)

#208 George on 08.03.17 at 3:48 pm

Let’s see the trend before we call it a crash. If this continues into August, September and October without government meddling than we are going to have more evidence that the upward trend has changed.

The upward trend is kaput. — Garth

#209 Smoking Man on 08.03.17 at 3:58 pm

Ouch

http://www.zerohedge.com/news/2017-08-03/toronto-housing-market-implodes-prices-plunge-most-record

#210 Vroom vroom on 08.03.17 at 4:04 pm

#190 SilverSon on 08.03.17 at 2:01 pm

#173 Another Deckchair on 08.03.17 at 11:13 am

That’s a pretty decent article but it’s overlooking stuff. Understandable because when you think about the whole picture the math to quantify it would get positively mind numbing. Still, the writer could have mentioned these things qualitatively. The article as it’s written is a good start of the absolute best case scenario for electric vehicles, but there are things that undoubtedly make them worse than illustrated in the article.

First thing the article doesn’t mention is countries that routinely purchase electricity from their neighbors. Canada (non-coal burning) routinely buys electricity from US (coal burning). Canada’s carbon emissions from electricity production should include a component that indicates how much juice they buy from the US which has a much higher carbon output. Then the EV (Electric Vehicle) picture isn’t quite as rosy for Canada, albeit still better than the US.

Second is that it doesn’t take into account maintenance over the lifespan of the car, and then it goes on to consider the lifespans are equal which cannot be proven. The article assumes a car’s lifespan is 200,000 kms which might be true for EVs, but not ICE (Internal Combustion Engine) vehicles which commonly make it to 300,000 to 400,000 kms. Sure, some people might not own a car past 200,000 kms, but they will definitely want to trade it in or otherwise sell it to get some money out of it (and then someone else will drive it beyond 200,000 kms). Does an EV need a new battery at 200,000 kms? I don’t know, but it will someday. Then when you consider how much carbon is tied up in an EV battery, the EV’s total carbon emission jumps up the moment you change its battery which adds to its gCO2e/km. Worse yet, if nobody is willing to replace the battery at its $6000+ price tag, the car would have to be scrapped at that 200,000 kms, at which point someone somewhere buys a new car instead of a used one. Relative to an ICE vehicle that would go to 300,000 kms or 400,000 kms, this means it takes between 1.5 to 2 times as many EVs to provide the lifespan of one ICE vehicle. Factoring that in, one could claim the total carbon emitted by the EV should be 150% to 200% of what it is for purposes of comparison with ICE vehicles.

Stuff like that is what makes me think EVs or hybrids aren’t the answer. They just look like they might be because we haven’t witnessed their long-term impacts nearly to the extent that we’ve witnessed those of ICE vehicles. The only thing conclusive I can see in all this is in this point that Another Deckchair made:

“My long-term take on this is that, really, we need to ban cars altogether. Fat chance, though… :-|”

Too bad so much of our economy hinges on cars … and RE.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Long live the Internal Combustion Engine, vroom, vroom, zoom, zoom.
https://www.youtube.com/watch?v=M4D3jwSYpEc

#211 NoName on 08.03.17 at 4:10 pm

#170 nick on 08.03.17 at 10:55 am

Maybe you can find a way around loss of range but definitely It is a factor for battery.

The performance of all batteries drops drastically at low temperatures; however, the elevated internal resistance will cause some warming effect because of efficiency loss during use. At –20°C (–4°F) most batteries are at about 50 percent performance level. Although NiCd can go down to –40°C (–40°F), the permissible discharge is only 0.2C (5-hour rate). Specialty Li-ion can operate to a temperature of –40°C but only at a reduced discharge rate; charging at this temperature is out of the question. With lead acid there is the danger of the electrolyte freezing, which can crack the enclosure. Lead acid freezes quicker with a low charge when the specific gravity is more like water than when fully charged.

#212 NoName on 08.03.17 at 4:28 pm

Forgot link, read comments

http://batteryuniversity.com/learn/article/discharging_at_high_and_low_temperatures

#213 Looney Baloney on 08.03.17 at 4:41 pm

Zero guy has an article out with lots more shiny graphs on Toronto RE data

http://www.zerohedge.com/news/2017-08-03/toronto-housing-market-implodes-prices-plunge-most-record

#214 I wish I bought in ... on 08.03.17 at 4:44 pm

2009. So many people were saying it’s the top back then including this blog which I still enjoy reading .Priced out now

Need a lot more carnage for ‘affordability ‘

Renter for life .And the Toronto renting market is a disaster

#215 april on 08.03.17 at 4:49 pm

#208- Hope that includes Vancouver, Garth.

#216 Dee on 08.03.17 at 5:22 pm

Gta will come back just like Victoria had a slowdown a few years ago.Now Victoria is roaring back with strong wage growth and low inventory.Homes will be out of reach for new home buyers because of income and rich immigrants coming to Canada by 300,000 a year not including investors.There still is money to be made in condos but not like before when it was

———————

Ever hear of the end of a 20 year credit cylce?

#217 young & foolish on 08.03.17 at 6:06 pm

“Then one day, a magic number is going to appear on the monthly statement, and all financial worries and stresses will disappear forever.”

The portfolio better grow, as the rent will for sure.

Falling house prices usually bring lower rents. — Garth

#218 young & foolish on 08.03.17 at 6:10 pm

“The upward trend is kaput. — Garth”

This now seems like a certainty … the question for those who failed to get out at the top is, sell now in a declining market, or learn to love the house you’re in!

#219 steerage steward on 08.04.17 at 2:42 am

On August 6, 1945 (2017), members of GreaterFool were convened to drop the bomb