The politics of collapse

MSM view: ‘No need to panic, folks!’

Imagine you bought a house two years ago for $330,000, need to sell, and yet the real estate agent tells you to list at $275,000 if you hope to find a buyer. Finally, one comes along, but offers just $170,000. You agonize over accepting it, then learn the potential buyer’s bank balked at financing the deal, saying the price was too high.

This is a true story, from Riverside, California. Here’s another, from Cape Coral, Florida, where a guy who paid $147,000 for a home in 2003, then renovated it, received an appraisal of $279,000 two years ago. Recently, as he came to sell, he received another appraisal, for $140,000. It’s listed now for $129,900, and he can’t unload it.

This is one reason the Canadian prime minister is desperate to have an election. He’s got smart people around him. They know what’s coming.

In the last 12 months, for the first time ever, 25% of all the people in the US who sold their houses got less than they paid for them. Not less than they were worth during the bubble – not a loss of inflated paper, greedy profits – but an actual sucking off of their net worth. In some communities, more than 60% of all sellers are taking an absolute loss. In fact in one town, a suburb of San Francisco, of those people who bought a home two years ago, the average unsupported mortgage debt is $171,00 – that’s $171,000 more than their houses are worth.

Can’t happen here, you say?

Well, I’ve heard that before. When I published my cautionary book on the subject five months ago I was told it was impossible for housing sales in Canada to crash in 2008. They have. And when that happened, the experts and economists said, okay, but prices will hold. But they haven’t.

This week’s numbers show that for the first time in a decade, home prices are going down – first in Calgary and Edmonton, then in Vancouver and by this time next month, in Toronto. Coming later this year will be Winnipeg, Saskatoon and Regina. In fact, prices on average in every community will be falling between 5% and 20%, according to several bank economists. The trouble is, those same guys said six months ago price declines were not in the cards. Period.

This leads me and a couple of others brave enough to say it (like David Wolf, of Merrill Lynch Canada), that home values will be lower next year by between 15% and 50%, depending on the community.

Thousands of buyers who got into real estate since about 2005 will be under water. Those young couples who took forty-year mortgages and made zero downpayments will be financially screwed, unable to sell their houses without a loss of tens of thousands of dollars and at the mercy of a rapidly slowing economy, higher energy costs and dwindling job prospects.

This is the nightmare government scenario. Just look south to see the damage this can do to a country, and an administration.

A real estate meltdown and industrial desertification of Ontario (especially) and Quebec, where all the votes are. Citizens pissed that Ottawa told them last year the economy was “solid as the Canadian Shield,” refusing to lower their income taxes, spending all the budget surplus, doing nothing effective to help the auto sector, and encouraging consumer debt with a 2% GST cut and those damned 40-year mortgages which walked so many young kids into so much debt on houses which are now fast deflating.

You may think I am an alarmist to say once again: Look south and see the future. But I’m not the only one who knows that a version of this will be unfolding in Canada next year.

The Canadian middle class largely believes the myth its leaders have woven. But the odds grow daily the next election could be the first one hijacked by a house.


#1 $fromaSia on 08.16.08 at 10:31 pm

Great article Garth, Thanks!

#2 Boone Pickens jr. on 08.16.08 at 10:57 pm

I’m a newly wed 25 year old chemical engineer looking at buying (been saving for 3 years since university) and its oh SO insanely ridiculous how ex[ensive a 3 bed house has gotten last two years, but at least its come down almost 10% in the last year. I was gonna hold off longer on buying, but I’ve been studying some of Garths books 2015 After the Boom: How to Prosper Through the Coming Retirement Crisis and I’m getting a little glum if we’re all jumping the gun on this whole thing. I mean the mountain of 48 year old boomers ain’t moving into nursing homes just yet (i think the peak birth year was 1960?), and even if they are they’ll just give their house eto their spoiled 20 year olds (like 2 of my friends just got given down payments). Somebody also told me the boomers are starting to get willed trillions from their parents – YAH RIGHT, my grandparents be lucky to have half a mill in the bank.

#3 lgre on 08.16.08 at 11:02 pm

I found this to be pretty odd, located in Hamilton

#4 David_#3 on 08.16.08 at 11:24 pm

There’s no way the current government is being responsible for people’s foolishness. If banks are willing to lend and fools are willing to borrow, it is not the government’s business to intervene.

None of this would have happened if it weren’t for the CMHC, skewing the market by guaranteeing loans that banks wouldn’t take otherwise… ( On a completely unrelated note, the CMHC was founded under a Liberal governement…)

#5 mike oboy on 08.16.08 at 11:29 pm

‘Politics of collapse’ is about winning and gaining power. If the economy remains strong, the reining party will hardly ever get voted out (ie. AB’s conservatives). If the economy starts to falter with the help of the opposition party swaying consumer sentiment and creating fear in the marketplace, then it always helps the opposition’s chances.

#6 islander on 08.16.08 at 11:39 pm

…doing nothing effective to help the auto sector…

Don’t be coy. Are you calling for more taxpayer bailouts of dying automakers?

#7 Dapo on 08.17.08 at 12:00 am

Up unitl recently I was a little confused as to why the Liberals seemed so indifferent to forcing an election. But now I have educated myself a little by reading blogs like this and scanning the business section of the G&M and other media more and more (mainsteam and other). And I think I get it now. When the economic shit really hits the fan the Conservatives are going to be covered in it. And deservedly so. No wonder Mr. Harper keeps making noises about fall elections brought about by vague references to hamstrung policy making.

#8 Aaron on 08.17.08 at 12:43 am

The main difference between the US and Canada is the quality and accessibility of data. One needs good data to make an accurate assertion regarding what’s happening in the market. Bad data lead to bad decisions.

It is absolutely phenomenal the amount of data one can get in the US compared to Canada. Up here, it’s all hidden away in governmental departments, disaggregated across several companies, or non-existent.

The other aspect has to do with foreclosure sales. You can open up any newspaper in the US and find columns of estate/foreclosure sales, whereas up here, it’s a rarity to find an ad for a house advertised as “distress sale” or “foreclosure”. Perhaps some difference in laws or advertising practices keeps Canadians from seeing the full scope of the picture? I’d like an answer to that, if any one knows.

#9 EJ on 08.17.08 at 12:46 am

It’s true. We’ve been amazingly fortunate to have a crystal ball in which to see the future: the USA. Not only to see it, but to alter our path to avoid the problems they have encountered.

But arrogance has prevailed once again. Ignore the warning signs, repeat the mistakes that others have made, and insist that the outcome will be different.

#10 L on 08.17.08 at 1:26 am

They better not spend our tax dollars on bailouts that benefit those who made stupid decisions.

#11 terry on 08.17.08 at 1:35 am

want some real canadian stories? here’s mine from calgary.

i’ve got a condo purchased in late 2006. bought it with only putting down 10%, remainder due at possession as it was being built. i prebought.

so here’s the numbers for ya.
bought it for $325k PLUS GST!!!!!!!

i wanted to flip it as soon as it was done. in fact my lawyer told me i may be able to get away without taking possession, as we could do a deal that would see me selling it to someone and title would be mine for literally seconds. i thought this would be great.

so it was done in may this year. no pre possession buyer interested.

i listed it at 353. nothing. not even a call.

so i lowered it to 329. nothing.
i lowered it to 314. nothing.

i’m under so much pressure now that i need to either walk away or dump it at a huge loss. luckily i found some renters who can provide me some funds for the next year (12 month lease) so i can make morgage payments.

what if property’s fall next year down another 15% like that report says (i think it was meryl lynch)?

i literally don’t know what to do.

#12 jarrett on 08.17.08 at 1:45 am

Geez Garth, I guess it’s your life’s ambition to dwell on negative housing situations. Wow, a book published, a website and daily updates on how terrible things are out there. I wonder what you do for fun? Read the obituaries. Sit on your computer and google ” bad news in the canadian and american real estate world” Isn’t that why we have CNN? . I guess bad news sells and to be different would be too much of a stretch for you. The world is full of pessimists, why can’t you find a way to put a positive spin on life instead of being a typical doomsday prophet. Isn’t it time to be a little proactive instead of reactive. I am not disagreeing with you about the situation but do you ever ask yourself, how does this serve to help anyone? You are in a very good position to make a difference with this site and your book but since the spotlight is on in your corner at this point in time, I’d try a little less fear factor, a bit of hope and positive options. Life is about finding solutions. I just don’t see how you’re helping, all I see is you tooting your horn. When things turn around how do you want to be remembered? One of the guys who predicted housing meltdown or A guy who shed light and provided solutions and options to a potentially dismal dilemma? You could help a lot of people? Don’t you think?

#13 rusty on 08.17.08 at 1:57 am

Bold prediction Garth. Your naysayers will have an easy time poking fun at you if you are proven incorrect. I will counter your prediction and state that no region in Canada will suffer 50% price decreases measured by median listing or average listing price by next year, but many will be lower by about 10-15%.

#14 neutral on 08.17.08 at 3:25 am

Looks like the picture above represents the people of the small ugly city with more than a half of black population. In one word “location”, which is bad. Of course, those areas will suffer, since nobody really want to live there. The RE was driven there by flippers and low-income black population. What else you would expect there?

#15 i'm_debt_free on 08.17.08 at 3:39 am

a good read.. worse times to come

#16 i'm_debt_free on 08.17.08 at 4:30 am

reality hits!

#17 BBC on 08.17.08 at 4:38 am

Sad but true! When do we expect to see the light of this dark ‘real estate tunnel’? What sort of mortgage rates will we be faced with at the end of this bubble? Time to sit back and wait it out.

#18 Brent on 08.17.08 at 6:12 am

It isn’t just young kids taking out 40 year mortgages. I personally know a couple in their mid forties that upgraded to a $900,000 home (way to much) recently and have a 40 year mortgage. I think he’s down 80 k already in two months if he tried to sell it.

#19 i'm_debt_free on 08.17.08 at 8:43 am

posting problems???

#20 mike on 08.17.08 at 9:07 am

“encouraging consumer debt with a 2% GST cut”

You’re 99% dead on with your posts and your book.

But when you’re out there, you’re WAAAAYYY out there.

Maybe cutting the GST has caused AIDS to grow, the neglect of the elderly, and an increase in Male Pattern Baldness too?

Your sentence implies that people can’t be trusted with their own money. Where are we, Québec?

#21 RJT on 08.17.08 at 9:42 am


I think that the delusions of Canadians is pretty funny. They argue that the big price declines in the USA is simply in undesirable neighborhoods. As if in Canada, all neighborhoods are desirable!

In every city, especially in the west, crappy neighborhoods saw huge price increases over the past year, as they were once “cheap”, but no longer. In my opinion, those ‘hoods are in for the biggest declines. For example, in Calgary, you used to be able to buy a crappy 1200 sq foot townhouse in a bad part of town for 120K (2004). At the height of the bubble, these were selling for 350K, almost a 200% increase in 3 years! The areas still suck, your neighbors are still poor and don’t do maintenance, but now, only “young professionals” can afford to buy these crappy homes in the ghetto without exotic financing.

This will end badly, and I’m afraid that CMHC (taxpayers) will be left holding the bag.

#22 lgre on 08.17.08 at 10:04 am

jarrett – what can Garth do now?? pay your mortgage off? the damage is already done. He’s just telling it like it is and most people on the board respect that about him instead of trying to lie his way through like the rest of the politicians and media. You better get out of that overpriced house before you loose your shirt.

The truth will set you free, but first it will make you miserable. –Jim Davis

#23 Toronto Crash on 08.17.08 at 10:07 am

Things are looking bad in Toronto. I’m finding that RE Agents are not denying it anymore and things are bad.

I was talking to a RE Agent whose speculator client bought a dump on a in North York on a 60×130 lot in Dec 2007 with an intent to build a McMansion and flip. He bought it for $560,000. He is now selling it to “break even” since he got cold feet and does to want to build and to have another McMansion sitting on the market which is not selling.

He recently listed it for $469,000 and it go no offers. I spoke ot the Agent yesterday and he admitted that he needs to sell for $600,000k to break even with land transfer tax he paid and Real Estate Commisions. He openly admitted that his client would lose “at least $50k”.

Another dump in North York which according to the agent would have “easily sold last year for $550,000 and received multiple offers from builders” was originally listed for $550,000 then reduced to $449,000 and now listed at $429,000. This house is on 40×130 and is steps to Yonge Street.

Looks the the speculators are running for cover as the panic has officially set in.

#24 Trekie2 on 08.17.08 at 10:07 am

#12 Jarret…

Garth is doing exactly what you state…he IS telling the truth…why have you such a problem with? Is it because it’s negative??? People in general have to be hit in the head with a hammer to actually stop and listen…I think he is achieving that. What would you have him do, state all was rosey like the general media and CMHC has been doing and not warn people of the truth???? Your post does not make sense…..things are getting bad, but tell people that all is OK???? How is this helping others??? I would mch rather be slapped in the face with the truth that told..”it’s Ok it won’t be as bad as the US”…..sheep to the slaughter….

#25 piccaso on 08.17.08 at 10:09 am


What about the three years of endless pump, people over bidding, get in now or forever be priced out. You think that mania of to the stars was any good for people.
The market isn’t falling because of pessimists posting on blogs. Nothing goes straight up 200% in 3 years with out crashing back down to earth. I don’t care if it’s real estate, a hot stock or tulips.

#26 squidly77 on 08.17.08 at 10:27 am

posters like jarrett amaze me
since when is falling house prices gloom and doom ?
just like when the wrong card comes up for you at the poker table its bad news..but for the guy across from you its great news..he wins you lose
and for people that didnt gamble..didnt look for the easy money..had some common sense and didnt buy into a speculative bubble the news could not be better
spec buyers are now doomed
people like me..98 % of the population are laughing at you fools
you are receiving your just rewards..after all if prices kept rising and rising you would have just carried on gambling and gambling..i feel no sorrow for you
and terry you wanted some easy money off of the back of your fellow under estimated their intelligence

lower home prices is fantastic news for young Canadian families

and no Harper is not stupid..he knows very well whats coming..but he facilitated it

#27 pbrasseur on 08.17.08 at 10:49 am

Why help the auto sector? It’s doomed anyways.

But you’re right the federal government should have lowered income tax. The federal government is a sorry mess, they collect too much money for our pockets then they spend it to buy our votes.

One thing I know for sure however is that the Liberals will only do worse. Maybe (just maybe) a conservative majority (without three socialist parties forming a majority…) would do better.

#28 MBS-Guru on 08.17.08 at 10:50 am

GTA here, anyone notice the vast number of open houses for properties in the past few months?. Looking at some numbers from recent deals, i see all sales are going for ~95-97% of asking and rarely 98% or more like the past two years. It all begins to crash for certain areas when one person becomes desparate and sells for a lot less because then other buyers set that price as the market value in the area and use it as a bargaining chip. Here’s some inside info, many pre-development condos create hype in their projects by making it seem like most suites are sold by placing the stickers on the board. Most are there to create a sense of urgency to make you buy now!!! ….. don’t worry that’s not illegal, there is nothing that regulates a sticker board. Anybody who’s bought a new suite last year or this year, that will be built in 2010 or 2011 probably just bought something that’s worth 10-20% less than what they paid for come fall of 2009. Many sale centers are dead nowadays.

#29 Keith in Calgary on 08.17.08 at 11:02 am

If the liberals get in after the next election you’re going to see home prices drop faster and farther than they are now.

Of course, if “The Messiah” gets elected in 3 more months in the US, you’ll see “our” economy crumble due to the US collapse resulting from Obama’s policies, and it won’t matter which Canadian party wins power because we’ll all be fooked. It’s make the 1970’s look like a tea party…….

It’s not the time to be making 6 figure life altering purchases…….

Sounds like more NEP scaremongering. Actually, as I have stated elsewhere, the price of oil has relatively little to do with housing prices – even in Alberta. That is a myth you guys have to recover from. — Garth

#30 Rick on 08.17.08 at 11:16 am

#12 Jarrett – You don’t think Garth *IS* helping alot of people? Give your head a shake.

#31 squidly77 on 08.17.08 at 11:16 am

“Sounds like more NEP scaremongering. Actually, as I have stated elsewhere, the price of oil has relatively little to do with housing prices – even in Alberta. That is a myth you guys have to recover from. — Garth”

could not agree more..the RE specuvestors jumped on the price of oil to jack the fever

#32 brazer on 08.17.08 at 11:20 am

#27 pbrasseur

“One thing I know for sure however is that the Liberals will only do worse. Maybe (just maybe) a conservative majority (without three socialist parties forming a majority…) would do better.”

Which government brought in 40 amortizations, thus allowing Canadians to dig themselves deeper into debt whilst further inflating the CAD real estate bubble?

#33 pete on 08.17.08 at 11:22 am

pbrasseur CONservatives have proven again and again that” tory times are hard times”. brian mulroney , mike harris , Jim Flaherty ,Harper have all done nothing but ruin Canada or Onartio province. They have always ran budget deficits and put Canada into recession or ruined the community they touched. NEVER have CONservatives been good for the working class/middle class NEVER. CONservatives is for BIG BUSINESS ONLY. When will you wake up to this? Garth IMO was a real conservative as I am a conservative but this CONservative party is anything but conservative. Wake up to the fact the CONs hate the working class and have proven again and again to go against the working class to favour big business.

#34 terry on 08.17.08 at 12:01 pm

well squiddly, what can i say.
i did try to make easy money, i won’t deny that.
i also listened to a lot of others around me who made huge money doing it. that is what is so confusing.

for example i have a co worker who bought a condo in 2003 just like the way i did by putting 10% down while its being built.

he never planned on selling it. he was thinking of hanging onto it to rent out and then maybe move into it himself when he retires in a few years.

but what happened was unbeleiveable. he had 5 realtors competing to buy the thing. he bought for $209k and finally sold if for $470k. the amount of money he made was unreal.

so i did the same. only problem is right now the market has changed. i think it will come back and prices are going to rise next year. our economy is stronger than the US’s.

there has to be others that did what i did and are makeing money. i don’t understand why mine is getting no bites. my realtor says that buyers are just not interested unless i lower price. but i can’t.

#35 3rdman on 08.17.08 at 12:20 pm

What about all the taxpayers going to the extended ‘A’ mission – thanks to our Imperial PM? That and the economy will sink him if re-elected.

If the O-reo gets elected South – look at the mess he inherits.

GT is just trying to help us through by encouraging careful thought and restraint at our level.

#36 Calgary rip off on 08.17.08 at 12:47 pm


Garth’s site is a HELP.

Especially in Calgary. The people living here and the papers are so deluded.

Thx. Garth.

#37 Bobby in Victoria on 08.17.08 at 1:12 pm

Let’s be honest, if someone has made a poor investment decision it is truly Canadian to blame the government. Imagine, taking responsibility for your actions. It’s unheard of.

Sadly, many people believe everything they see in print or hear from a salesperson. They tend to forget that many of these people have a vested interest in their product so will always focus on the positives, rather that the whole story.

My favourite here in Victoria is the comment that home prices will double in the next 20 years, leading many to purchase to avoid being left behind. The reality is that is only a 3.6% compound return over the same period, something you can get on a very safe and liquid GIC.

Salespeople hate it when you ask questions, particularily if you want the answers in writing. If they are evasive, walk away as it is your first clue. While out looking at condos about a year ago, I had an agent telling me that these particular units were a fantastic buy, and that they would only go up. I asked the obvious, which one did he own or what other properties did he own here in Victoria. After a lengthy pause, he replied he only owned his own home……..he got badly burned in the last downturn. Sums it up pretty much.

#38 wealthy renter on 08.17.08 at 1:24 pm

“I just don’t see how you’re helping, all I see is you tooting your horn. When things turn around how do you want to be remembered? One of the guys who predicted housing meltdown or A guy who shed light and provided solutions and options to a potentially dismal dilemma?”

Jarrett, your question strikes me as a bit naïve. There are no solutions to the housing problems faced by many middle-class Canadians. “Many” would be defined as people that have bought high priced homes and are drowning in debt, or it could mean also young families trying to break into the real estate market.

I can only speak for Toronto, where the median household income is around 55K. A young family of four looking to buy a place hits a brick wall. A good home in this city (good neighbours, good schools, good home condition) will cost between 300K to 450K. I will stress that anything under $350K will get you the minimum standard of “goodness.” I rent in a gated luxury building that is surrounded by some of the worst shithole buildings in Canada. Yes, you can get a condo from 55K to 225K in my “hood,” but good luck if you have kids.

The wall off affordability has been hit for the middle class in this city which really has two choices: rent, or drown the family in debt and start swimming. Even if you take a 300K mortgage for 35 years, the payments will be around $1700, and condo fees in Toronto are in the stratosphere. I can only guess that the lower middle class in Vancouver has not bought homes for years.

I TRULY think that many housing bulls have lost track of reality. There are many hard-working families in this city making between 40K and 75K. If these families are out of the realm of any readers’ “social sphere,” they would not realize how much traditional, working, “middle-class” people are being hammered by the real estate market.

There are no solutions to this fact.

#39 Rasputin on 08.17.08 at 1:30 pm

Attn Jarrett: Garth is providing a valuable service…provided you listen. One of the oldest saying among those in ithe know in the world of money is “When the herd is selling, buy. When the herd is buying, sell.” I suspect Garth is one of the most optimistic people out there. I agree with his position and I know I am very optimistic. Why? Because I can see the opportunities beyond the crisis. Fortunes will be lost and made. What side are you on? Are you part of the Joe Six Pack herd or are you a little bit beyond that? It’s time to decide who you are dude.

#40 CalgaryRocks on 08.17.08 at 2:06 pm

A real estate meltdown and industrial desertification of Ontario (especially) and Quebec, where all the votes are.

I wonder if voters in Ontario & Quebec will notice that their respective provincial governments are run by a bunch of fanatical socialists that flushed all their money twofold in good times and now are caught with their pants around their ankles.

Nah, it’s all Harper’s fault. In fact, I hear he told both GM & Ford to keep building cars that nobody wants because there is this guy, his name is Mcguinty that will give them millions for doing it in Ontario.

#41 Pete on 08.17.08 at 2:15 pm

Jarret – To give you an example of how valuable this blog is to those, like me, who have felt that housing was way overpriced but also feels under pressure to buy. My girlfriend wanted to buy last year. I used this and other blogs to back up my view that it was a bad time. We would have bought a one-bed starter apt. in Vancouver with a good downpayment, with a view to moving up the ladder to somewhere more spacious in a couple of years (that’s how the property ladder works right?). With the Vancouver market set to “correct” significantly (how could it not with ave prices more than 5 times the ave. salary?), we probably would have lost that downpayment (plus buying and selling costs) and found it hard to sell had we not decided to continue renting for a few years. Now we can enter the market, maybe even in a bigger place that we could afford before, with a larger downpayment when the time is right – a couple of years probably. This blog helped us dodge a bullet by providing information to balance what is printed (or rather not printed) in the MSM.

#42 Keith in Calgary on 08.17.08 at 2:45 pm


I didn’t mention oil prices in my post. Low oil prices will not hurt us though…..IIRC things are economical at around $40 a barrel…..that is along way to go.

What will do us in up here is Dion’s platform of wealth redistribution thru fictitious green taxes, amongst other things….and Obama’s plans to tax everything and everyone that moves in the US.

There is no economy in recorded history that has improved because of higher taxes.

If you are willing to state here that Dion or any liberal leader will not impose newer taxes of any kind, in any name, shape of form, and that he will not raise existing taxes that would go a long way towards disputing my statement. Until then you may call fear mongering……….and we take that for what it is worth.

Personally I do not know why you are a liberal because you seem to have a head on your shoulders.

How do you feel about Jewish people, or vegetarians? — Garth

#43 Tom on 08.17.08 at 2:56 pm

I agree with Jarret a little bit but I also think that many people live above their means. I recently went to a party where a couple brought their two kids…AND their nanny.

Give me a break.

I think North America needs a well deserved kick in the ass…perhaps it’s Canada’s turn.

#44 My_view on 08.17.08 at 2:57 pm

The biggest housing bubble of all time.

What’s the problem with our economy are not just home mortgages. It’s everything that goes inside the home and parked in the driveway. Everyone who has bought a home thinks they are rich.

I was at a house warming party last night. The couple just bought a 900 sqft condo for 300k (0 down/40 yr). Taxes are $2500 and condo fees are $475/mth. (Pool, game room, tennis court, blah, blah) Never mind the mortgage, just the taxes and fees add up to $683/mth.

They had to use a credit line to furnish the place. So, their response is that the condo will only rise in price and they will dump extra $$$$ every year towards the mortgage. No your not. People who took these loans all think the same, if you’re not going to increase payments since day one. You’re not going to pay off anything. After their first 5 year term, they will have paid only 10k towards principle, add the CHMC insurance and closing costs. They still owe the same amount they borrowed.

These built condos should have been rented (built as apartments) not sold to own. When was the last time you seen any apartment building being built? Look at the majority of buildings built 20 years ago, they don’t age well. Throw in rising taxes and fees. Good luck trying to sell these places in the future.

My point is, it’s not only mortgages. It’s all the credit people have been getting. We all owe more than we make. Unseen ever in our history.

Cash Is King

#45 prairiegopher on 08.17.08 at 3:15 pm

Hi Garth,
I read your book and enjoy reading the daily updates on your blog. I find your information and that of the contributors very insightful. It is clear to me that some people don’t want to hear the truth and maybe then it won’t come true. Just tell everyone it’s okay, keep spending and all will be fine. I have a daughter and her husband who bought a home a year and a half ago in Edmonton and I am sure they are underwater. I worry about them, but I guess they won’t be alone. I would suggest they sell, but I think it’s too late. Now is a time to sit still, hang on and try to weather the storm. Keep up the good work Garth! On a political note, I live in Sask. and the best thing we ever had was Ralph Goodale as finance minister. But people weren’t happy and now guess what? The new guy doesn’t even know how to spell Saskatchewan.

#46 crashing yuppy on 08.17.08 at 3:44 pm

Dear My View

Good post,

The joke is on your friends. These condos will become the rental apartments of tomorrow. First of all I hope they are not planning for a family.

900 feet is Ok for a couple living in each others pocket, however when a kid comes along, forget it.

0/40 is like renting (no equity) with the risk of investing.
The worst of both worlds.

They are delusional are they are sitting in the barbers chair waiting for the haircut.

1 of 2 things will happen. They will get cabin fever, living in the shoebox or pregnant and have to bail at a loss, or they will tough it out and move when the building starts to decay or, more likely, they get delusioned with the market.

Great concentrations of condos of smaller sized (read the great forest of projects ringed around the Skydome)
will be Toronto’s next ghetto’s.


#47 Downsized and Delighted on 08.17.08 at 4:05 pm

I find it strange that when people own real estate that goes up in value 40 or 50 percent in a short time, they go out and spend more money putting in new kitchens etc.; but when they own a stock that goes up in value 40 to 50 percent they quickly sell off half to get their portfolio in the proper ratio. And yet, most of us (not me) are leveraged to buy that real estate making the situation even more risky.

#48 Keith in Calgary on 08.17.08 at 4:11 pm

Garth said…..”How do you feel about Jewish people, or vegetarians ? ”

Uhhhh, lets see……I am a big supporter of Israel and think PETA sucks…….does that help ? LOL !!

#49 islander on 08.17.08 at 4:54 pm

Garth, you’re losing credibility.
You pander to Ontario voters with your veiled call for corporate welfare for automakers.
Then you suggest that NEP is a chimera. Try telling that to people who lost their homes to NEP I.
Your Fearless Leader’s re-branded NEP II is a wealth-distribution scheme in aid of your party’s shrunken Central Canadian rump.
To morph that argument into a slam against Keith in Calgary that implies he’s a conspiracy theorist who fears world government by jewish bankers or eco-veggie-hippies is a fair sign that you are not interested in a discussion of the facts.
I’ll repeat Keith’s challenge: are you willing to state that Fearless Leader will NOT impose a carbon tax?
Yes or No?
If you’re really a truth-teller, meet the question head-on, instead of with cheap dodges.

A giant myth is that NEP was responsible for a drop in the value of homes, esp in Calgary, between 1980 and 1985. False. Take a look at commodity prices during that time but, more importantly, interest rates. The province experienced the same stress that rising mortgage caused in most major markets but, without a well-developed industrial base and an over-reliance on swings in natural resources values (which the NEP did not influence, as dumb as it was), this increase was felt proportionately more. I know it’s always nice to have someone to blame when our investment go to crap, and the mirror is usually where to find him. — Garth

#50 rant in Calgary on 08.17.08 at 5:26 pm

If billions of dollars lost… we will find it in tax’s.
8% G.S.T.?

#51 Keith in Calgary on 08.17.08 at 6:33 pm


I was a mortgage and loans manager in Calgary during 1982-1985 and worked for the now defunct National Trust Company branch in TD Square. I was brought out from Vancouver to sort out the mess the branch was in after the introduction of the NEP in 1980.

High interest rates did not cause the crash…….job losses due to the NEP did. (because we were not diversified enough it hurt those without jobs, but that was not the reason things tubed).

I watched the second mortgage portfolio go from $70MM down to $35MM in 18 months due to “walk aways” as a result of job losses. I was in the trenches of the greatest economic collapse this province has ever seen………”to date”.

We had a joke going around back then…..”How did you get a geologist ?… yell out Hey Waiter !!”……heh.

First, a sudden and rapid drop in world oil prices was also a factor in the oil patch crisis, no? Second, what is Alberta doing to prevent the same result when the next commodity price crisis arrives? Just asking. — Garth

#52 squidly77 on 08.17.08 at 6:34 pm

oil bubble
mortgage interest graph 1979-2008

the NEP had very little effect on the world energy prices
it was just one more for Alverta after the last hit then we were hit again as every thing around us imploded all at once

as i write this it is amazing how similar the world is now compared to 1980
very high speculative RE prices (especially in Alberta)
sky high priced metals markets
very low interest rates
trouble in the middle east
trouble in Pakistan
trouble in Russia
all of the above could explode quicker than a faulty fire cracker with a very short fuse

#53 squidly77 on 08.17.08 at 7:08 pm

keith i almost always agree with you but..the NEP was just the killer punch after we had already taken a very bad beating..then the whole world went into recession
“The economic effect of the program is debated. After it was implemented, Canada, along with all of the economies of Europe (except for Norway, ironically due to their petroleum industry) and the economy of the United States, fell into a worldwide recession. It would turn out to be the worst economic downturn since the Great Depression.”
that period of high interest rates wiped everybody out
i finished high school in the late seventies and earned my trade tickets by 1982 just as it blew up..there was zero work in calgary as we had no other industry to turn to
i fear not much has changed
btw my thoughts on the NEP it was just stupid

#54 squidly77 on 08.17.08 at 7:27 pm

you could paste this graph over the world oil prices graph and they would look almost identical
the national energy program was very badly timed it unnecessarily punished alberta and could not prevent the unpreventable from happening
RE much like today was heavily gambled on in alberta with reckless abandon during those boom years

#55 Mini-Garth on 08.17.08 at 7:49 pm

Anyone just read the National Post article Garth just linked to: “Heading for a soft landing:
No need for panic in most of Canada over housing slowdown.”

It’s uncanny the way the real-estate and mortgage industry is literally borrowing, word-for-word, from the US real estate lobby in explaining away the downturn.

The langauge used is exactly the same; it’s as if they’re using the exact same playbook.

It’s ironic that the Canadian real-estate lobby should use the exact same language of the US real-estate lobby (soft landings, temporary corrections, etc). , and then at proclaim that Canada and the US are so different.

#56 a good word for "trill" on 08.17.08 at 8:20 pm

Canadians like the Americans need more safe and profitable investment options than what is currently available. The C.D. Howe Institute and a prominent American economist, Robert Shiller, also think so.

If it makes sense to you, why not write your M.P. to get behind some sensible options for your savings.

#57 jim on 08.17.08 at 8:38 pm


Most U.S. regions have not seen any significant depreciation in home prices and there are many areas that have still increased over their two year sub-prime melt down began. If you’d like some price data on oil-producing areas of Texas for example, let me know.
But yes, as Garth estimated 15% declines months ago, some areas of Canada with 40+% affordability indices and faltering local economies will see declines. However, i doubt you’ll see a replica of the ‘Sub Prime’ city picture above.

#58 squidly77 on 08.17.08 at 9:25 pm

jim name one..
look here
or here
you look
these are 12 month losses..not peak to an unknown trough

byw..although the oil and housing boom seem to parallel
each other i do not believe one influences the other
they just point to massive growth periods followed consistently by declining or negative growth

the RE crash is unstoppable..there has never been a boom without a bust..newtons laws apply every where always
Whenever a particle A exerts a force on another particle B, B simultaneously exerts a force on A with the same magnitude in the opposite direction. The strong form of the law further postulates that these two forces act along the same line. This law is often simplified into the sentence “Every action has an equal and opposite reaction.”

#59 Keith in Calgary on 08.17.08 at 9:39 pm


What is Alberta doing ?……..good question.

If you read this report you’ll probably draw the assumption that not enough has been done….and I think you’d be correct. O+G has dropped 5% in GDP terms…….big deal.

However, IMHO, this time it has been our central bank (50%), our politicians (25%) and people themselves (25%) that will have let us down. A oil price collapse won’t kill us….but new and higher taxes, the higher interest rates we must have, along with the huge and unprecedented levels of consumer and mortgage debt will.

I am debt free and rent so I am relatively immune…….we must let the banks, businesses and people fail…….

#60 Mississauga_man on 08.17.08 at 9:41 pm

Garth, you’re losing credibility.
You pander to Ontario voters with your veiled call for corporate welfare for automakers.
Then you suggest that NEP is a chimera. Try telling that to people who lost their homes to NEP I.
Your Fearless Leader’s re-branded NEP II is a wealth-distribution scheme in aid of your party’s shrunken Central Canadian rump.
To morph that argument into a slam against Keith in Calgary that implies he’s a conspiracy theorist who fears world government by jewish bankers or eco-veggie-hippies is a fair sign that you are not interested in a discussion of the facts.
I’ll repeat Keith’s challenge: are you willing to state that Fearless Leader will NOT impose a carbon tax?
Yes or No?
If you’re really a truth-teller, meet the question head-on, instead of with cheap dodges.

A giant myth is that NEP was responsible for a drop in the value of homes, esp in Calgary, between 1980 and 1985. False. Take a look at commodity prices during that time but, more importantly, interest rates. The province experienced the same stress that rising mortgage caused in most major markets but, without a well-developed industrial base and an over-reliance on swings in natural resources values (which the NEP did not influence, as dumb as it was), this increase was felt proportionately more. I know it’s always nice to have someone to blame when our investment go to crap, and the mirror is usually where to find him. — Garth

Garth, YES or NO ?

Yes or no, what? And be warned, I am not going to debate the Green Shift policy of the Liberal party, or Mr. Harper’s own flawed climate change plan for that matter, on this blog. This is for a discussion of real estate markets and issues affecting them, which a carbon tax or lack of one will have zero impact. You wanna talk politics, go here. — Garth

#61 squidly77 on 08.17.08 at 9:44 pm

look where canadian cities are located on this list..holy sh..
jim you were saying that most US cities are not experiabcing price jim i will never ask you for
some information concerning house prices as it seems its flawed..

#62 Keith in Calgary on 08.17.08 at 9:50 pm

Sorry that should be an 8% drop for O+G……5% was a typo…..

#63 jim on 08.17.08 at 10:26 pm

Sure thing Squidly,
I’ll even use the source your using – housingtracker. How about Houston, the largest city in Texas (kind of like Calgary is the largest city in Alberta – except we have approximately 45 times their proven and recoverable oil reserves).

You can see from the lower table in the link below, the median price has risen in all three percentiles. For instance in the 75th percentile the price rose from 266,375 in 08/2006, to 289,950 in 08/2008.

#64 wealthy renter on 08.17.08 at 10:49 pm

Crashing Yuppy,

“Great concentrations of condos of smaller sized (read the great forest of projects ringed around the Skydome)
will be Toronto’s next ghetto’s.”

I live right in Toronto, and I usually take the Subway & Path to get to destinations dowtown, and use the 401 when I drive. However, a few weeks back, my dad and I went to see the Bombers/Argos game and took the Lakeshore Go-Train. I was a little dumbstruck by the amount of building going on in the area you mentioned. There are thousands of starts and many more along the train line.

I would love to know the profile of the typical buyer in these developments. I wonder also how many are specuvestor owned?

I lived right downtown for the (cough) 10 years I went to UofT. I also wonder if these new “urban pioneers” know what the hell they are getting themselves into. I love the city, but it can be crushing to people used to the burbs.

It will be interesting to see how these neighbourhoods evolve.

#65 squidly77 on 08.17.08 at 11:10 pm

jim…i absolutely knew that you would happily swallow the bait
HOUSTON — (July 15, 2008) — Despite a tenth consecutive monthly decline in sales, the average and median prices of a single-family home in the greater Houston area soared to record highs in June, according to statistics released by the Houston Association of REALTORS® (HAR). Single-family home sales slid 14.7 percent on a year over year basis. However, the number of closed sales was the highest since last August.
first falling sales..then falling the blog topic
lets check back in 6 months after all the good houses are sold..can i have my hook line and sinker back now ?

#66 jim on 08.17.08 at 11:21 pm

So then you’re agreeing with me squidly…’the average and median prices of a SFH in the greater Houston area soared to record highs in June’ and just an aside, what kind of uppers are you on dude? i gotta get me some…

Anyhoo, i was going to say …bubbles, like the infamous tulip bubble in the early 1600’s, always deflate back to there original ‘real’ price. But, i’m not convinced everyone here understands (won’t mention any names) why the price of real estate never returns to it’s previous inflation-adjusted price after the correction stage of it’s cycle? It’s the same reasoning oil now will never return – limited supply (we’re running out).

I’m also not sure everyone understands the largest factors that determine house prices are affordability and demand/supply. In places like Alberta, where house prices have decreased and wages risen, the amount of pre-tax income to service housing costs is now in the low 30% (among the most affordable in Canada). And with the province’s young population, high job growth and falling housing supply (lower housing starts), it’s only a matter of time before they start rising again (ie. sort of like Houston has risen last 2 years while places like L.A. have fallen)

#67 squidly77 on 08.17.08 at 11:30 pm

A 2005 estimate set the total world resources of oil shale at 411 gigatons — enough to yield 2.8 to 3.3 trillion barrels (520 km3) of shale oil.[2][3][4][5] This exceeds the world’s proven conventional oil reserves, estimated at 1.317 trillion barrels (209.4×109 m3), as of 1 January 2007.[22] The largest deposits in the world occur in the United States in the Green River basin, which covers portions of Colorado, Utah, and Wyoming; about 70% of this resource is located on federally owned or managed land.[23] Deposits in the United States constitute 62% of world resources;
3.3 trillion barrels here..thats colarado usa
1.7 trillion here..thats alberta Canada
sometimes you should think a bit jim
theres so much oil in this planet that it will take multiple generations to even come close to exhausting it
then the conversion to alternate energy will be as easy as going to the fridge to grab another kokanee
who killed the electric car
big oil and gubburment

#68 squidly77 on 08.17.08 at 11:38 pm

that should have read about 2.41 trillion barrels in colarado
about a trillion barrels more than the alberta oil sands

#69 dotava on 08.17.08 at 11:51 pm

#4 David_#3 on 08.16.08 at 11:24 pm

There’s no way the current government is being responsible for people’s foolishness. If banks are willing to lend and fools are willing to borrow, it is not the government’s business to intervene.
None of this would have happened if it weren’t for the CMHC, skewing the market by guaranteeing loans that banks wouldn’t take otherwise… ( On a completely unrelated note, the CMHC was founded under a Liberal governement…)
This government is peace of [email protected] They are thinking about Capitalism from beginning of 20th of century when was reasonable to give extra profits to intelligent people to start another business – BUT – we are in 21st and now we are in place where economy turns depend on middle class and many of our kids are smart and have ideas but we (old stupid chumps).
To not to move from your point – it’s exactly to say “Let’s live criminals (I am not talking here about “shop-lifters” – what our present government is talking) to do what they are good in” – nonsense.

#70 jrochest on 08.18.08 at 12:02 am

The reason Texas hasn’t had a collapse in prices is because they had no rise in prices. The average house price in Dallas was 100K in 2000, and it was 125K in 2007, according to the Case-Schiller data.

What didn’t go up doesn’t come down.

#71 TrueGritCalgary on 08.18.08 at 12:23 am

Suprisingly, here is Ralph Klein’s view of the NEP:

#72 dotava on 08.18.08 at 12:26 am

Garth – I don’t agree with your observation that present “PM has smart people” – they are intelligent but – self serving small … avoid to use the word to offend worms who are important part of our earth living.

#73 dreamer on 08.18.08 at 12:37 am

I am looking to buy a house in Cabbagetown or Riverdale and was wondering if people could give me any info on the area and why these places are so popular to buy. (I am not from Toronto and have no idea about neighbourhoods)
I am feeling quite desperate to buy and I have fallen in love with the look of these homes. Does anyone think that I should wait to buy in these areas as prices should come down? When I look at listings, so many are sold in Cabbagetown and I am wondering if these places will not drop in price very much because they are so sought after. Help! I have no idea what to do and would appreciate any expertise on these areas as this may be simply a dumb, emotional purchase for me!!
What should I do?!

#74 Blacksheep on 08.18.08 at 1:58 am

Most adults can still remember the price correction of

Talk to ten people waiting in a line at a bank and nine will tell you R.E. prices are going to drop.

Peoples views on the current market correction under way, on mass, has been decided.

The realestate price train has climed the mountain, crested the peak, and in now careening down the back side.

Some will try to catch a falling knife,

most will wait till the market bottoms.

Events have been set in motion that cannot be stopped until the market finds a more ballanced supply/demand position.

#75 Allan in Toronto on 08.18.08 at 4:26 am

Hi Garth,

I really enjoy your site. Thank you. I am an Elliott Wave and W.D Gann expert. Based on my understanding of various technical aspects of the Canadian Real Estate market and based on W.D Gann time cycle and Elliott Wave counts, the market is in deep sh*t.

#76 Stuff on 08.18.08 at 10:00 am

I was looking to buy in Toronto last year but, although people called me crazy, it just didn’t feel right getting into a bidding war and paying 100K over asking for a fix-me-up semi-detached home in a so-so, “up and coming”, area. So I waited. Everything logical told me there is no way this trend could continue forever because eventually people won’t be able to afford the amount the homes were going up every year.

I found this site in January and it solidified my thoughts. Garth is DEAD ON about what just makes sense. How much the prices will decrease is the only question. I mean even if the homes were to stay at the same levels as last year that gives me one year to save up a bigger down payment which in itself is a great help.

As for me, I’m so glad I waited.

#77 pete on 08.18.08 at 10:06 am

dreamer who are you kidding? You want to buy so bad and home ar selling? LOL That couldn’t be further from the truth of home roiting on the market and prices falling in that area. Hey, it your money if you want to pay bubble values for a home jump in today. If you want to save 20% or more in one year wait. The housing bubble has popped and nothing anyone can do to stop it. Even RE agents are saying prices are coming down.

#78 Jim_s on 08.18.08 at 11:02 am

Cdn Household debt rising rapidly

“Mortgages rising at 13 per cent a year is totally inconsistent with what we’re seeing in the economy,” he said. “When the economy is slowing and credit is accelerating, something is wrong here. Something is not good.”

This simply substantiates the fact that creative financing since 2002 is now taking a larger bite out of personal net worth.

When home prices were rising, using your home as an ATM machine goes unnoticed. Previously the talk was not about “net worth” but credit card debt, as rising home price values meant rising net worth, commensurate with any debt accumulation, and was not alarming. In effect, many took out a margin account on their home banking on forever price increases…. quite risky. Skyrocketing home prices shields the reality until prices start to fall.

With RE values currently at their peak or headed down, those that borrowed based on never ending RE price increases are in a precarious position.


#79 JJ on 08.18.08 at 11:03 am


My advice to anyone wanting to buy in Toronto now: Wait at least a year. Agents have been telling me things are bad and we are on the verge of a major correction/crash. You will save thousands by waiting.

#80 Otto on 08.18.08 at 11:13 am

For those of you who posted about the Ontario auto industry and think you know what it’s all about, let me assure you that, at least from what you’ve written, you do not.

I’ve worked in the industry for 17 years and can tell you that yes we are in bad times right now, but also that my opinion it is extremely unlikely the industry will die.

Nine tenths of our product goes the US and fat Americans like big cars, not small cars they can’t fit into. When the US economy picks up, so will the sales of new cars made here in Canada. It’s that simple.

Due to reduced market share, the big 3 manufacturers have shifted their goals to making more money selling less vehicles. Meanwhile Toyota and Honda who have been trying to set up shop in North America for 30 years have do so here in Ontario and are doing quite well. I don’t think they’re going anywhere anytime soon. So dead? I think not.

With our previously low dollar, our American friends have thought of Canada as nothing more than just another Mexico, except with better quality perhaps. When our dollars re-adjusts to previous levels more investment will come to Ontario from the US, it’s good business sense.

There are 7-10 auto related jobs in Canada (mostly in Ontario) for every 1 in the auto industry. Auto is the back-bone industry of Ontario and is what pays the majority of our taxes.

Bail-outs: There are virtually NO areas in North America where governments don’t offer grants in return for investments from the big three. If our government wants people to keep working and paying taxes they have little choice but to help with the investment. To not do so would be disastrous as illustrated by the Chrysler plant closure in Winsor when the government refused to pony up.

My only question is how long before Honda and Toyota start looking for hand-outs?

#81 Another Albertan on 08.18.08 at 12:04 pm


Allan, if you could expand on the technical aspects of your EW analysis, I would be interested in reading that post.

Co-incidentally, a strikingly-similar topic of discussion came up on Saturday night as I shared drinks with a couple of energy traders…

#82 TOguy on 08.18.08 at 12:13 pm

Crashing yuppy, I agree Toronto real estate prices are going to fall (I figure 10-20%), but this statement is a little over the top:
“Great concentrations of condos of smaller sized (read the great forest of projects ringed around the Skydome)
will be Toronto’s next ghetto’s.”
These condos are right on the waterfront. I don’t see waterfront property becoming a ghetto. It’s just not going to happen. Sorry.

#83 MikeB on 08.18.08 at 12:47 pm

Hey Dreamer

I am not sure your post is serious or some sort of joke or sarcasm but if you are serious… those markets are popular because in general those were small quaint areas that in general were affordable and family friendly. The homes were generous in some cases and had lots of charm. They are close to major transportation like the subway. HOWEVER if you are a nuts and bolts guy like me the problems with the area are in my humble opinion are crowded streets, very old infrastructure ie old plumbing going to the house… houses are too close together for my taste and rarely had parking or a garage.
Prices now are out of control for these areas with some bidding wars still happening. Why??? Don’t ask me… I would not buy there unless I was single…. maybe not even then… When to buy. Well, we sold our house a year ago and are renting until there is a clear direction of where housing in T.O. is going. I have personally witnessed many properties being bought last year cropping up this year and not selling and having to reduce prices over and over… still no sale… We are waiting at least 8 months. Read this blog and you may get a feel for where stuff is going. Those areas are really too hot and may not see a serious drop because of the crazies who like those places…

#84 jim on 08.18.08 at 1:08 pm

Unfortunately squidly, the kerogen shale oil (Colorado/Utah) to which you’re referring is presently not recoverable. Exxon, Shell and others have been trying to extract it since the 70’s. The following is a good article to get anyone who’s interested up-to-speed:

And squidly, the proven and recoverable oil reserves by country are below (if you’d like another source, just google ‘oil reserves by country’ and take your pick):

#85 FP on 08.18.08 at 1:09 pm

Slow economy takes toll on household finances

OTTAWA — The slowing economy is taking its toll on household finances, driving up debt at a faster pace than incomes and assets, new analysis from CIBC World Markets shows.

“This is a fact because the economy is underperforming,” CIBC economist Benjamin Tal said in an interview about his analysis of household credit.

In the first quarter of 2008, household debt in Canada rose almost 3 per cent but personal disposable income rose just 2 per cent, pushing the debt-to-income ratio up to 130 per cent from 122 per cent a year earlier.

For full article:

#86 pete on 08.18.08 at 1:24 pm

Wow SQUIDLY #64,

Houston’s home prices still increasing over the last 2 years must be kind of scary for a Calgarian non-owner!!

Must also really get your heart racing watching Calgary’s year-over-year sales increase while listing inventory falls!

ALSO, with regards to your Colorado SHALE DREAMS, oil companies will never in our lifetime figure it out!! Not to mention the power/strip mining/heat it would use would require ‘you-don’t-wanna-see-CRAZY’ oil prices!

#87 Calgary rip off on 08.18.08 at 1:24 pm

Garth, what gives with the article written by Mario as usual and his propaganda in the Calgary Herald? What is it about Calgary that makes so many of the people ultra conservative bulls wanting their property to remain high and essentially doom their economy?

I have contacted Mario personally and told him to stop writing garbage, but me thinks he is one in the speculator crowd(up yours Mario!!). Home prices to rise in Calgary? UNLIKELY Mario, unless you have idiots lined up to buy the ripoffs!!!

No real estate surplus in Canada: report
Mario Toneguzzi, Calgary Herald
Published: Monday, August 18, 2008
There is “scant evidence” of a significant supply overhang in Canada’s residential real estate market in contrast to what’s happening in the United States, says a report released today by Scotia Economics.

The Real Estate Trends report, authored by Adrienne Warren, senior economist with Scotia Economics, said the inventory of completed but unsold new homes, while edging higher across most major markets in Canada, remains relatively low from a historical perspective both for single-detached and multi-family developments.

“The volume of homes for sale in Canada’s resale market has also been moving up, and combined with softer demand, has lifted the national ratio of new listings to sales from an average of 1.6 in 2007 to 2.0 in June,” said the report.

“This shift from the strong sellers market of recent years to essentially balanced conditions points to a cooling off period in which home prices should rise in line with general inflation.”

But the report said there are significant regional differences with new listings to sales ratio in several of Canada’s previously hottest markets like Saskatoon, Calgary and Vancouver “now favouring home buyers, with greater inherent downside price risk.”

In the report, Warren said the realignment in residential construction toward sustainable levels is just beginning in this country. Between 2001 and 2006, Canadian housing starts averaged 222,000 units on an annual basis, well above underlying household formation of 175,000.

“This overbuilding has continued in 2007 and the first half of 2008,” said the report. “A widening gap between new construction and household formation is evident across all provinces, and has contributed to the gradual rise in unsold new homes in recent years.”

The report said that while Canadian homebuilding has cooled since the spring, overall starts continue to outstrip sustainable long-term demand.

On the other hand, the report said the slump in U.S. homebuilding shows no signs of abating despite an over 50 per cent drop in housing starts from their early 2006 peak.

It is “far too early to call an end to the U.S. housing downturn,” wrote Warren. “For one, the potential for a meaningful turnaround in home sales is limited when soaring gas prices and mounting job losses are severely straining household finances. Real wages have been falling on a year-over-year basis since last November and consumer confidence is hovering around a 16-year low.”

Warren also said a massive over-supply of unsold homes south of the border will keep downward pressure on both prices and construction.

#88 FP on 08.18.08 at 1:34 pm

Interesting blog piece — Truth or Talk: Is Canada Special?

#89 Kate on 08.18.08 at 2:23 pm

I think that Garth is helping people. I am a young-ish professional, married to another professional, and I live in Vancouver. Our household income is around $150,000, and I was feeling quite desperate to buy a house or condo in order to have a nice place to live and feel “successful”. I compared myself to friends and colleagues, all of whom own, and felt like I was missing the boat. However, I was simply not willing to take on the enormous monthly payments to buy inflated Vancouver properties. I picked up Garth’s book in Chapters, read it cover to cover, and felt like I had made the right decision after in all not buying immediately. Now, I have decided to wait out the storm and get a much better deal in a year or two. I think Garth has saved me tens of thousands of dollars.

#90 squidly77 on 08.18.08 at 2:38 pm

hey jim..reserves are reserves and only 10% of the oil within the tarpits is recoverable (see my wiki post above)

pete said
Must also really get your heart racing watching Calgary’s year-over-year sales increase while listing inventory falls!
whats that pete ?
it is very satisfying seeing the bulls get losing all that money dosnt it !

#91 lgre on 08.18.08 at 2:49 pm

otto – I dont think that the big 3 will go down, but I also dont think that toyota or honda will need help anytime soon either, the qulity is MUCH better then the big questions asked. Everyday people are starting to realixe this and start to dump their fords and gm’s for hondas and toyotas, that is the reason that the big 3 are in shambles. Putting out a poor quality product will catch up with any company and that is what happened here.

#92 APCM on 08.18.08 at 3:12 pm

To #81 TOguy – the area around the Skydome and King West Village may be a Toronto ghetto in a few years.
Waterfront property? It would be nice if it wasn’t next to the Expressway. Open your windows or step outside and you can hear the whoosh of the cars. Plus, wait until the car soot settles on the buildings.
And it looks like it’s not getting torn down (in that area) any time soon.

#93 rant in Calgary on 08.18.08 at 3:21 pm


Calgary is one of Canadas most expensive cities to live in and your talking affordability. Calgary also made the top 100 list for priciest places to live in the world. Granted, lots of oil money floating around, but just like oil and water it all floats to the top(managment).
Not too many wages have tripled or even doubled in the last five years to keep pace with RE increases. With oil stocks now receding the Wealth effect is reversing, were now seeing that in sales and prices.
Housing starts are down because there is a surplus in inventory, not because investors’ are tired of making money.

#94 Jim_s on 08.18.08 at 4:05 pm

Lots of oil money floating around is just that: Floating. It has to park somewhere, so by default homes are getting higher priced due to speculation.

Is Calgary an international tourist location?
Do we have the ocean a few clicks away?
Movie production studios?
Music producer head offices?
Do we have an NBA team, MLB team, or college sports?
If Alberta were a country, would it have the 5th largest economy?

Well, the answer to all of those is NO to Calgary, and YES to California. Yet, CA house prices are dropping like crazy.

In fact, if you look at the median price list posted earlier you’ll see that Fort McMurray has almost the same median home price as Honolulu.

Is that rational?


#95 Rasputin on 08.18.08 at 4:38 pm

Kate #88. I think Garth may have saved you Hundreds of thousands of dollars. That’s a life changing amount.

#96 Marcus Aurelius on 08.18.08 at 5:11 pm

Toronto Crash highlighted a nub issue: The greed of sellers in certain North York and other ‘fringe core’ neighbourhoods – who have been selling for increasingly stupid amounts to greedy builders. In that North York area, 2-bdr war bungalows (i.e., teardown shacks) on 40- foot lots went from 250K (mid-1990s) to 500K (2004 or thereabouts) and sellers are now looking for well over 600K. A total dump on 30 feet of frontage in C4 was listed this month for 849K in the usual ‘dance of the 7 veils’ Ho’-down for builder purchasers. Even if you assume a ‘real building cost’ of under $200/sq ft for the minimum ‘luxury quality’ materials, you see immediately why these infills are pushing nonsensical prices (even after the builder pretends that his moron nephew ‘lived’ there for a year, to evade CRA taxes). The collapse will begin when the lot vendors realize that builders are retrenching, forcing land acquisition costs down. But there may be a wrinkle – these builders (especially foreigners from places where land is a premium asset – e.g., Iran, Asia) don’t realize that Canada is a big place, and the suburban disease is still attractive to many, so they may still try to pocket the reduced acquisition cost and maintain jack-ass (read: Yuppie) pricing. But that too will collapse. It will just take time in Toronto. I agree with those who see the rubber hitting the price road in the second half of 2009. Just pay down/off your mortgage (and take the trade-up hit in market value, if you’re looking to move up), save cash, and wait for the delicious sound of jack-ass pity-parties, where Wifey starts to understand that even if the Pusateri’s bill is reduced, there’s no money left and no chance of equity in the home to finance Sonny’s stay at that expensive reform school.

#97 TOguy on 08.18.08 at 5:17 pm

APCM, Do you honestly think new upscale condos built close to the waterfront, harbourfront, parks, Skydome, the ACC, BMO Field, the Ex/Ontario Place, the entertainment/tourist district, the CN Tower, the financial district are going to become ghettos? They are ghettos for middle to upper middle class yuppies from what I can tell. If that area becomes a ghetto, then what’s to stop Yorkville from becoming one? Or all of Manhattan or London for that matter?

#98 Marcus Aurelius on 08.18.08 at 5:36 pm

Cabbagetown and Riverdale – Dreamer’s Question:

As a 3rd gen. mid-town TO HogTowner, you can take this to the bank: Cabbagetown was where the very poor lived in the 20s and 30s, and Riverdale was where addicts and criminals lived in the 50s and 60s. Cabbagetown ‘gentrified’ first, Riverdale later, and now the geniuses of BS selling real estate are working on a mythical place called “Leslieville”. But here’s the news: criminals, working poor, drug addicts and hookers didn’t live in these places by accident. It’s only been a generation (of dumb-as-hammers yuppies) since folks forgot these areas were places you wanted to get out of, not move to.

Stick to North Toronto – bounded by Eglinton, City Limits (York Mills/Wilson), Bayview and Bathurst, or Central TO (Eglinton down to Bloor, central corridor) and your investment will likely always be safe. Political correctitude prevents me from elaborating on the demographic facts the underly this advice. But you can ask at your local cop shop – they have more a pressing reality than the RE industry, that overcomes any shyness about telling you what’s what on the streets of Toronto. Ask them where they’d prefer to live – a nice little 3bdr 1800 sq ft victorian semi in Cabbagetown for 800K, or a nice little 3 bdr centre-hall in Allenby for 800K. Nuff said.

#99 Allan in Toronto on 08.18.08 at 5:51 pm

Another Albertan:

I don’t know how to upload a chart, but for this discussion, I can refer you to the famous Shriller’s chart titled “A History of Home Values” as displayed on page 19 in Garth’s book. This chart is an approximation as explained in Irrational Exuberance; however, if you cross reference Shriller’s chart to this Calgary chart as posted earler by another poster:

you will have a feel of what Shriller’s chart looks like zooming in. Shriller’s chart does not show minuete Elliott Waves structure for the period from 1998 to 2006; it just show a big lift. Therefore, for final legs of Eliott Waves, I will use this Calgary as an approximation for this discussion.

Wave 1 started the up move from the second half of 1985 and ended around the beginning of 1990 and wave 2 began; wave 2 began from the beginning of 1990 and ended at the end of 1996. Note the time interval for wave 2 was not less than wave 1. This is very important under Neowave rules (Glen Neely, Mastering Elliott Wave) as too many Elliotticians got their counts wrong for failing to acknowledged this observation. Another point to note is that wave 2 is a regular flat. Wave 3 then began its ascend from 1997 and ended around June 2000. Wave 4 is actually a running flat correction at the direction of the main trend which began at the beginning of 2001 and ended around the end of 2004. Notice again that under this interpretation, the time frame of wave 4 is not less than wave 3. Also, another very important point, wave 4 is a running flat whilst wave 2 is a regular flat, hence, this gives us the required alternation between wave 2 and wave 4. Wave 5 began at the beginning of 2001 and ended 2006.

Now note that for the entire 5 wave structure, the extended wave is the 5th wave ! this is very significant for many reasons. One is that commodities will alway have extended 5th waves (stocks have extended 3rd waves). Second, once everything is all said and done, the correction of one degree higher will ENTIRELY RETRACE ALL THE DISTANCE OF THE FIFTH WAVE. This is why we see that the correction in the US is now at 2001 levels and is showing no sign of stopping, this may implied that this correction from 2006 peak is actually an impulsive wave down, very scary thought indeed.

There are also a W.D. Gann explanation, but you didn’t asked, so it is not provided

#100 jim on 08.18.08 at 6:05 pm

So I gotta ask you Jim_s…

Why don’t you try to immigrate to say L.A., if you are so in love with it? Sure you’d pay a little more with the exchange, but otherwise the median home values are fairly close.

Could part of the answer be… you’re an intelligent guy and you know the your most prosperous future lies in Alberta?

Anyway, if you decide to go let us know in a couple months how you’re enjoying no health care coverage and high taxes (that state always ranks around 49th in economic freedom studies – Alberta ranked 2nd in the lastest economic freedom study of North America, in case you cared to know)

Make sure you get a good home-security system and keep a gun under your pillow… we definitely want to hear back from you!

#101 dreamer on 08.18.08 at 6:19 pm

Responses to dreamer,
Thanks for the info, I am totally serious asking these questions. I have had a terrible time renting as my landlord has been a nightmare and has even gone so far as to come into my rental house and steal things from me. I feel quite desperate to be honest, I feel like I should maybe take a bit of a hit financially for my own sanity. That was why I was wondering about Cabbagetown and Riverdale, it just seems like my investment would be safer in places that are popular and close to transport, especially with gas prices.
I just thought maybe these areas would be safe from price declines as they are talked about so much?
Thanks Marcus for the info about particular areas as I have no idea about TO and what you say makes sense about the criminals and addicts, there must have been reasons for having to live there…I will check these other areas out.
As for all of the SOLD Cabbagetown houses, I think it is
probably a crock, realtors are probably holding onto these sold listings for many months to make it seem hot?
Check out this Cabbagetown realtors website, he would have you think everything is getting snapped up in this area as he has barely any listings available.
What do you guys think? What is that about, it can’t be that popular, surely?
I will most likely find another rental house for the time being and keep an eye on properties that appeal to me in the next year or two. I will fight the impulsiveness that my life situation has created. My intuition tells me to be patient, but it is hard at times.
Any other recommendations for Toronto real estate areas in the future, close to transport and amenities?
I really would like to invest in areas that have a great future and have safer than most neighbourhoods.
Help! I could use peoples’ expertise and experiences…

#102 brazer on 08.18.08 at 6:20 pm

Financial Crisis Is Expected To Bring More Big Shocks

“Among the predictions: the failure of some of the country’s biggest financial institutions, the collapse of 1,000 banks and a possible government bailout of mortgage giants Fannie Mae and Freddie Mac.”

#103 APCM on 08.18.08 at 6:23 pm

#96 TOGuy – All I know is that I wouldn’t want to live that close to the highway. The buildings themselves are nice but most of the actual units are on the small side. The area is close to a lot of venues, but I would rather visit the area for a sporting event than take a crowded streetcar to work every morning. Being close to tourist attractions doesn’t make a place a good area to live in. I was in Paris last year and the area around the Eiffel tower had the most vagrants. Plus, living near the entertainment district isn’t great either. The area around Richmond has the most clubs clustered in one area in North American– there’s a lot of noise from clubgoers and a lot of debris the next morning on the streets, not to mention crime and police. And it’s not that close to the financial district. You get to the financial district faster from Yorkville (via subway line)

On a side note, I see no advantages to the townhouses in King West Village. There are condo fees for no value and they are fairly small.

#104 brazer on 08.18.08 at 6:24 pm

CIBC World Markets sees softening in Canadian household credit
Mon Aug 18, 3:14 PM
By The Canadian Press

TORONTO – CIBC World Markets says Canadian households are slowing down their borrowing, although the investment firm notes there has been double-digit growth in both mortgage and non-mortgage credit.

CIBC says the Canadian mortgage market is still up by an “impressive” 13.4 per cent compared with last year but adds “this pace of growth is unsustainable.”

It adds there are also early signs that the pace of growth in non-mortgage consumer credit is slowing.

Overall consumer credit is now expanding by just over 10 per cent on a year-over-year basis.

Among other points raised in the report, CIBC World Markets says the cumulative number of consumer bankruptcies rose by 3.8 per cent during the year ending June 2008, with Ontario and Quebec leading the pack.

CIBC economist Benjamin Tal warns in the report that we can expect consumer bankruptcies to rise even further.

#105 jim on 08.18.08 at 6:26 pm

and rant in Calgary #92,

Alberta is ‘now’ one of the most affordable provinces in Canada to purchase and live in a home.

As prices have come down and wages have gone up, the index has fallen since it is a the measure of ‘average’ wages in an area ‘versus’ that area’s ‘average’ home prices.

Arguing how expensive or inexpensive prices are or how much or how little some people make doesn’t change how affordability indices are measured by banks and governments.

#106 Jason on 08.18.08 at 7:02 pm

Not surpisingly , Saskatoon realtors backed by CMHC say that contrary to ML report, that states our housing is ~50% overvalued, is incorrect, and that we will actually see sizeable gains with our home sale price rising to $325,000 by the beginning of 2009. Once again, they are saying there has never been a better time to buy with the economy the way it is.

What a load of BS.

#107 brazer on 08.18.08 at 7:25 pm

First it was subprime…next is “Alt-A”…watch and see.

#108 nwo on 08.18.08 at 7:42 pm

Things could get a lot worse than 5% – 20%.

The U.S. economy could collapse before end of year.

What do you think will happen to house prices then?

#109 AM on 08.18.08 at 8:22 pm

“Not surpisingly , Saskatoon realtors backed by CMHC say that contrary to ML report, that states our housing is ~50% overvalued, is incorrect, and that we will actually see sizeable gains with our home sale price rising to $325,000 by the beginning of 2009.”

What does Meryll-Lynch have to gain from their report?
I don’t think ML would put the idea 15-50% reduction out there without a fundamental analysis of the market, real estate or otherwise.

You can’t blame real estate boards and CMHC from defending their best interests but do they back up their position with anything substantial? How can two opinions be so different. Does CMHC look at incomes in Canada when they make these bold face predictions? How do they think people can afford to keep the current cycle of insanity going.

#110 Calgary rip off on 08.18.08 at 8:27 pm


Where in Alberta exactly? Edson or far up north where there are no jobs?

What kind of nonsense is this?

At least in Calgary, go for a $120,000 per year minimum income to get around a starter home on a 25 year mortgage. That’s to purchase one of the “quality” starter shacks with the optimal 8 feet between your house and your neighbour.

Its amazing that absolute bs. and delusion in Calgary. Sooooo deluded here.

For a wakeup call, go to in Humble or Spring(Houston area) and see what houses SHOULD be priced at.

After looking at that American site and comparing it to the load of crap in Calgary on the Canadian mls counterpart you’ll probably take a dump or throw up because its so disgusting.

Its a sad fact that speculators and the other slime in Calgary have made it next to impossible for anyone but the very rich to acquire a decent home. And Ed Stelmach’s helpful policies on rent controls make for a lovely situation for renters when the owners decide to build and boot their tenants out.

Perhaps Alberta should just become part of the United States, because as a dual citizen living here, there isnt much difference in the Canadians living here from the Americans. At least that way, the whole stupid bubble in “affordable” Alberta would deflate like the guy who ran out of viagra.

#111 Another Albertan on 08.18.08 at 8:36 pm


Allan, thank you for the time put into that response.

Your prognostication maps rather closely with a qualitative analysis put together by me and some fellow engineers with backgrounds in control systems.

The world’s most stable and successful companies struggle to grow at even close to 10% annually. They hire the best and smartest and can’t do it. Home owners, on the other hand, have been convinced that nary a coat of paint nor any handy work on a dwelling will still grow at 20-50% YoY.

No system can grow unbounded at those rates (i.e. – deviates from a “normal”, sustainable trendline) without serious implications.

#112 rant in Calgary on 08.18.08 at 9:09 pm

Wages going up, that’s inflation-not making things more affordable. People in starting positions demanding more money to deep fry chicken. Fast food joints closing at 6:30 pm or shutting the doors completly due to the lack of staff.
Now, if you think Calgary is a safe place, open a newspaper, let your wife ride the c-train after 10:00pm.

#113 Boone Pickens jr. on 08.18.08 at 9:56 pm

Calgary rip off

i think jim’s talking about that report he posted a while ago:

He’s just saying that if prices came down this year then it would mean that the index of 39.7 for the 4th quarter of ’07 (pg 8) is now probably in the low 30’s (the most affordable province). Cus wages have gone up too, i think about 5% in the last year .
Not sure, i know mine has gone up more than that.

#114 brazer on 08.18.08 at 10:18 pm

GM is getting very desperate…… on:

#115 Zebedee on 08.18.08 at 10:23 pm

Calgary is toast. As a Calgarian it is plainly clear that the market has stalled here from the buyer’s perspective. Resets of prices will now come about as those who are forced to sell do so at much lower prices. It is the FORCED sales that will set the market price ever downwards, and with 42% of homes for sale in Calgary being empty, which means the owners are probably paying at least two mortgages, it is just a matter of time before a good percentage of those become distress sales.

Keith in Calgary – you sound like a right wing nut, going on about Obama going to raise all taxes (untrue). For that to have sunk into your suspiciously closed mind you must have had it drummed into you, which makes me wonder: What is a devoted Fox news fan doing on a site like this?

#116 Bobby in Victoria on 08.18.08 at 10:26 pm

Let’s remember, both the CMHC and all those tied to the real estate industry have a vested interest in putting a positive spin on the market.

Just take a look around at the rising number of houses for sale, I counted 8 houses for sale on the same street here in Victoria.

Irregardless of what the industry says, Canada has it’s own subprime issues. If the vast majority of new mortgages are 0 down and a 40 year amortization, I can safely suggest we have our own subprime issues.

Let me ask the obvious, if the economy in Alberta is so hot, why are there so many houses for sale? My guess is that many are way over extended and are starting to panic. Moreover, who wants to buy something if the price might be cheaper, a lot cheaper next month. Of course, there are those who bought something new based on the perceived value of their own hom. But now the can’t unload their first house.

Remember, your house is only worth what someone is willing to pay, not what some new realtor guesses it is worth.

Yes, it’s going to get ugly!!!

#117 wealthy renter on 08.18.08 at 10:30 pm

“Any other recommendations for Toronto real estate areas in the future, close to transport and amenities?
I really would like to invest in areas that have a great future and have safer than most neighbourhoods.
Help! I could use peoples’ expertise and experiences…”

For raising a family, I don’t think many people could find fault with the W8 area of Etobicoke (West Toronto bounded by Bloor, Eglinton, Royal York & Renforth.)

Since most of the homes in the area were built in the 50s, 60s & 70s, I would readily admit that the homes lack the character and grandeur of some of the finer inner city neighbourhoods. Nevertheless, this area has some of the most beautiful homes and spacious streets in the city. Last summer, there were over 100 houses over a million dollars.

It is a suburban area, but some parts of central Etobicoke have a small town feel. There are many streets with frontages as big as 100 feet. The area also has some of the best separate and public high schools in the city.

This area is not party central, but it is a safe and excellent place to live if you don’t find yourself too close to the airport. It gives quick access to the major highways and the subway.

#118 poorguy on 08.18.08 at 10:54 pm

I recently moved to Jacksonville,Florida.I can tell you
we Canadians are completely in dellusion.This place
is like paradize,yet everything is so affordable.And
dont ask me about the weather.I think Canadian RE
has gone insane.Toronto prices have to come down
(it will) by 50% to make them comparable with US
RE.The argument,we are different is bullshit.

#119 Jim_s on 08.18.08 at 10:55 pm

Realtor jim @ 99;

You want me to “immigrate” to L.A.?

I think you mean “emigrate”, don’t you? And btw, I lived there for 6 years, ran a business, sold it, and moved back to Calg as my family lives here.

What I said about Calgary having nothing of the international appeal that L.A. does, yet has higher house prices, is 100% true. For some, truth hurts.

Overpriced, over supplied, over pumped, over done RE market is what we have now.

I admire your militancy. However, it borders on the retarded. Houses are NOT a good investment. They are a place to live.

Accept it and move on.


#120 Keith in Calgary on 08.18.08 at 10:59 pm


Reality bites eh ?

#121 brazer on 08.18.08 at 11:17 pm


bears needn’t use ad hominem attacks on bulls.

#122 squidly77 on 08.18.08 at 11:17 pm

hey jim and pete..its coming your way..too late now
jim and or pete..why all the emotion ?

#123 squidly77 on 08.18.08 at 11:25 pm

keith when they get got em !
calgary will be the epi-centre of the Canadian housing bust
what happens there..will to some degree happen to others parts of Canada
make sure that you read all the pages..
bidding wars..fixed
condo line ups..people were paid to stand in line
unusually low asking prices..intentionally done to create phony media hype
you gotta be smarter than the salesman

#124 DD on 08.19.08 at 12:29 am

Yes Fort Mac is high. However with high incomes comes high home prices.

The medium salary is probably the highest in the country. In 2006 it was $130,000. Today it is in the $150,000 range.

Futhermore, renting is not possible there. So if you live there and want what Ft Mac has to offer you have to buy.

Remember… Ft Mac is right in the heart of the 2nd largest oil “fields” in the world.

#125 piccaso on 08.19.08 at 12:37 am

Fort McMurray is a hole.

#126 DD on 08.19.08 at 12:53 am

#114 Zebedee ….. 42% of homes for sale in Calgary are vacant? That is one bold statement. Where are you getting your facts?

#127 DD on 08.19.08 at 1:00 am

#117 Poorguy.

Constuction costs are a lot more in Calgary than Florida because of winter and the labour shortage (yes we still have a labour shortage in contruction). May guess is that the price will come down to the cost + some reasonable profit. Over the long term if the builder cannot make money they will not build.

#128 David on 08.19.08 at 1:12 am

Here is an interesting little press snippet on mortgage fraud.

#129 brazer on 08.19.08 at 8:20 am

Large U.S. bank will fold: Ex-IMF economist

“We’re not just going to see mid-sized banks go under in the next few months, we’re going to see a whopper, we’re going to see a big one, one of the big investment banks or big banks,” said Mr. Rogoff, who is an economics professor at Harvard University and was the International Monetary Fund’s chief economist from 2001 to 2004.

#130 Real Estate Collapse on 08.19.08 at 8:37 am

Detroit Home Sells for $1!

The Detroit News reports that a Detroit home recently went on the market for $1 and sold, 19 days later for full price. The home at 8111 Traverse St sold for $65,000 in November 2006 and according to neighbours was the nicest house on the block at the time.

So how does a house go from $65,000 to $1 in under two years? The subprime problems in the US had something to do with it but the neighbours appear to have played a major part as well. From the Detroit News article:

But the home was foreclosed last summer, and it wasn’t long until “the vultures closed in,” Upshaw said. “The siding was the first to go. Then they took the fence. Then they broke in and took everything else.”
Scrappers tore out the copper plumbing, the furnace and the light fixtures, taking everything of value, including the kitchen sink.

The author of the Detroit News article Ron French had this to add on the Zillow Blog:

Ron said it’s fairly typical to see this type of thing in bad neighborhoods in Detroit, but it’s becoming more common to see it happening in nicer neighborhoods. “As soon as they know it’s empty, it’s like a gazelle limping in the Serengeti — they will take it down. You will see people pushing a wheelbarrow down the street, full of siding or copper. They take everything.”

#131 Real Estate Collapse on 08.19.08 at 8:41 am

Some more listings in Detroit

#132 piccaso on 08.19.08 at 9:08 am

Housing costs are higher in Alberta because of 99% spec. End of story.

#133 No fool on 08.19.08 at 9:49 am

Hey, I don’t know if you guys check out regularily, but last week the Median home price in Calgary was listed at $402,422. The stats are apparently updated daily.
Now, the median price has been pinned at $400,000….EXACTLY! The odds of that are pretty much impossible, but the fact that they won’t drop the figure into the 300’s is pretty despicable. More fixing of the numbers. These RE guys in Calgary are crapping their pantaloons.

#134 $fromaSia on 08.19.08 at 10:11 am

Conservatives are looking to call an election soon.

Looks like they want to do it before Canadians find out about Flahertey’s Zero down and 40 year BOO, Boo’s!!!

Also the housing woes comming up and whos to blame for it.

#135 timbo on 08.19.08 at 10:26 am

#126- DD
there is NO labor shortage in res-new construction anymore. go look at the goverment job bank and search for plumber in calgary. The only plumbers that are wanted now are for commercial and industrial jobs or service. All the plumbing companies that service new construction have laid off not only the hacks but good plumbers.

If anyone wants to know what is going on it is very simple. first take a drive into a new development. Do not look at the sold signs as they are standard issue to create illusion. Check out the dug basement foundations after the showhomes are in place, and how many excavations are in progress. this will give a hint to the amount of actual selling as part will be spec and part will be already pre sold.

Last year as a sample if you went into copperfield at the back in the circle we had every 2nd lot being developed at a foundation to rough-in stage at once. very hard to park with more than two trades working at once. 3-9 years ago it was 1 out of 3 lots were in production at once. now take a drive accross 22x to the brand new development at montgomery south of copperfield. Those showhomes have been up for 6 months and look at the construction going on. the only thing going in is the utilities. In 13 years of working in the industry I have always beaten the utilities on the first phase of a new subdivision. The builders are telling us all something by not what they say but how they act. If you have a chance drive to sage valley in the N of calgary and see how a subdivision normally goes in. the utlities went in just 4 weeks ago and houses are just coming off generators. this phase started a YEAR ago with 80+ houses already built.

this is from the trenches and not from sitting in the office reading others speculations. I know of electricians who had 5 guys working for them last year ,to working by themselfs pulling wire now. Tin bashers who had so much work that they were working 7 days a week last year to now lucky if they are pulling 3 days. This stuff is partially hidden because there is still commerical and industrial work available but holds have been put on some contracts now because of financing.

We had a huge speculation bubble which I watched last year and started to get smart. I read my work orders and found out in one subdivision alone the same names were coming up in purchases on the same block. Watched as the names on the work orders would change at rough-in, waterline and final stage, and the funny thing is, it was a name of a person on the same street. (flipping)…. saw immediate for-sale signs at key handover and I could not follow it from there .Going back last week I see alot of signs on the lawn.

I want to personally thank garth for the book and for some friends who warned me about what was happening in Arizona awhile back. I made me dig and look real hard at things in ’06 and not jump on the bus.

#136 Jim_s on 08.19.08 at 11:25 am


brazer on 08.18.08 at 11:17 pm

#118 bears needn’t use ad hominem attacks on bulls.

No, bulls needn’t use ad hominem attacks on bears. Before you start taking on the roll as the righteous one on the blog, please read all the remarks.

Defending oneself is not an attack.

Do you know the difference?


#137 Calgary rip off on 08.19.08 at 11:27 am

No Fool: Get used to it. Calgary is the land of the bulls. And you know what bulls produce. Any of those sites you mention should be enough for anyone with half a mind to go to take an immediate dump or puke all over Ed Jensen.

#138 Rasputin on 08.19.08 at 12:22 pm

Just a thought…If an election is called and your party does get elected, I would demand a recount. Rightly or wrongly, whatever party is holding the bag when this thing really lets go will be buried forever.

#139 squidly77 on 08.19.08 at 12:59 pm

For example, the Canadian housing market looks eerily similar to America’s in 2005 or 2006, just before it began its drastic reversion to the mean.
Conditions in Canada could be about to get a lot worse.
this blog is 100% right

#140 Zebedee on 08.19.08 at 1:41 pm

DD…a while back one of the blogs for Canada linked to an article that talked about it. I found the number astonishing and it stuck with me because 42 is the meaning of life! If you take a look at the number of spec homes that are for sale in places like Royal Oak and the number of people who bought or built new homes prior to selling up the old homes, then you start to realise that the high number of empty dwellings for sale is a leftover of the real estate madness that is just leaving now, and it will be a large part of the hangover too! I am also starting to see the same homes listed simultaneously on the MLS and on the home rental sites. I personally am grateful we got out of the house market in time, as even though we had bought in 1999, I think we will see a retraction far past 1999 prices.

#141 brazer on 08.19.08 at 1:53 pm


No, bulls needn’t use ad hominem attacks on bears. Before you start taking on the roll as the righteous one on the blog, please read all the remarks.

Defending oneself is not an attack.

Do you know the difference?

correcting another poster’s grammar or spelling may not be considered “defense”, but rather an acute type of condescension.

for example, i could patronize your post above and point out that a “roll” is something served with dinner, whereas a “role” is anything but.

however, doing so would not be nice “defense” on my part.

#142 Chincy on 08.19.08 at 2:15 pm

#138 Squidly77…great article you posted…October I figure we hit defcom 2.

#143 kabloona on 08.19.08 at 2:32 pm

timbo #134, thanks for the posting. Nice insight at the ground level.

#144 jrochest on 08.19.08 at 2:37 pm

Ah, Squid? I love your posts and all, but the cover story for that last link is “Are We Living In The Last Days?”

I don’t think it’s going to be quite *that* bad :)

#145 Dave on 08.19.08 at 3:24 pm

Toronto mid-august #’s are out.

Prices up 5% over Aug 2007. (Up 7% for City of Toronto)

#146 Calgary_rip_off on 08.19.08 at 3:35 pm


Enjoy your posts. Keep ’em coming. Also post that link on Bob Truman’s blog. He along with most of the other Calgary realtors are in denial. That blog full of bulls needs to be blown up, its spreading too much false information.

Any Calgary prospective homeowners, please read this blog in its entirety, not Bobs or some Herald crap which is propaganda before you buy into the speculator circus in Calgary.

#147 Calgary_rip_off on 08.19.08 at 3:38 pm

This house was probably $400,000 when it was built. Probably will be that price again soon.(calgary)

#148 Jim_s on 08.19.08 at 3:44 pm


No, telling someone to avoid ad hominem attacks is acute condescension. If you don’t see that, then you’ve got blinders on, dude.

Mind your own business….. you are not this blogs’ moderator. There is nothing ad hominem about defending a statement, nor is there anything condescending about it.

Telling someone to “take the high road, like me” reeks of a superiority complex.


#149 rant in Calgary on 08.19.08 at 5:27 pm

Affordability is all relative. I can afford a $1.50 litre for a litre of gas. I can afford a “hummer” to put that $1.50 litre in.
Well I can even “afford” to buy a $250,000 motorhome to put the $1.50 gas in. Price does not matter when your leveraged.
I think that everyone should own a motorhome too, thay can “afford” it.

#150 Shifty on 08.19.08 at 6:33 pm

Looks like the ABCP debacle in Canada has been resolved for the moment by issuing a bond to the holders. The question I have is if the paper, which holds questionable debt including mortgage debt, who is going to be left holding the bag and what will be the fallout for the financial institutions involved ?

#151 brazer on 08.19.08 at 6:39 pm


i apologize if my posts upset you. that was not the intent – truly. why don’t we close this issue now so as not to clutter the blog any further.

best wishes,

#152 brazer on 08.19.08 at 7:24 pm


Looks like the ABCP debacle in Canada has been resolved for the moment by issuing a bond to the holders.

this is far from over…it’s going to the supreme court for final appeal.

#153 Calgary Rocks on 08.19.08 at 7:26 pm

This house was probably $400,000 when it was built. Probably will be that price again soon.(calgary)


Nice house. Prepare for 700$+ heating bills in the winter.

#154 timbo on 08.19.08 at 8:07 pm

just came over something you might want to see and hope that it can be averted here in canada.

#155 Sam on 08.19.08 at 8:22 pm

And the spin masters say – price going up!!

#156 Troop Commander on 08.19.08 at 8:42 pm

Squidly77: You need to stock up on ammo and tin soup cans. I see they have hooked up internet to your bunker.

#157 average confused guy on 08.19.08 at 9:37 pm

to Squidly77 and Radly 77,
I am having great trouble deciding if i should sell my house in inner city calgary, bought in 2006 to live in not to flip. It is pretty old. Kinda crappy if you compare it to granite counter tops and cherry stained maple raised panel cabinets and fully developed basements. Problem is, I love it. Nice and small, just for me, nice garage, half way home no matter where you are because its inner city. GArths book and the alberta blog and radlys blog and squids comments have me confused as hell. The ML report says Calgary 15 % over valued, and now Radly is saying he bought and that prices have a chance to go up or down +/- 5 % or so from here…or something like that…his stuff is to technical for me to totally get…squid is screaming armagedon for last 18 months and has valid points like “it always returns to the mean” kinda thing. My house is for sale. I can afford it but not easily as I am like a lot of Calgarians who spend more than the traditional 32% or so on housing. Then I worry big time about the economy slowing, my line of work slowing therfore cant afford payments etcetc. I work in sales and if people lose their ability to buy stuff, I lose my income. Love to hear thoughts from either of you…

#158 squidly77 on 08.19.08 at 10:02 pm

#153 good one hehehe!!
when i began blogging on housing sites i was often accused of wearing a tin foil hat..everybody in calgary thought prices would go up and up and up forever
and of course they cant
do you realy think that people who put nothing down over 40 years at a cost of 50% of there take home pay have a hope of keeping those houses ?
if even 4% fail.. a financial pandorahs box will appear
why ? read this
what do think they will find inside that box ?
what do you think lays ahead ?

#159 squidly77 on 08.19.08 at 10:17 pm

i will just post this for #154
chasing prices down is dangerous
look at how many times sellers have reduced downward their asking price

#160 WetCoaster on 08.19.08 at 10:42 pm

Ah, Squid? I love your posts and all, but the cover story for that last link is “Are We Living In The Last Days?”

I don’t think it’s going to be quite *that* bad

That’s the problem with Xtian websites – they tend to be hoping and wishing for the ‘end-times’ so they can be raptured or something of that nature.

I tend to take it with a wheel-barrow full of salt.

#161 Calgary Blog Bunny on 08.19.08 at 11:03 pm

Re: #144
Calgary Rip Off, you seem to be threatened by accurate information. Talk about shooting the messenger.

Here’s the flip side of that coin(posted today by the moderator of the Calgary Real estate Market blog):

“Bob Truman, at First Place Realty, is one of the sole providers of real estate information and statistics in Calgary besides the CREB. I use a lot of Bob’s data in my graphs, so he deserves a big shout-out for making this information available to the public!”

#162 squidly77 on 08.19.08 at 11:38 pm

its sure hard being a bear when surrounded by highly intelligent housing bulls..wetcoaster get your hair cut

#163 squidly77 on 08.19.08 at 11:54 pm

blog bunny..get over it..all in calgary know his agenda
he sells houses and runs a censored blog
its really much better to not bring his name up for his sake
everything has now turned negative in calgary
for the past 2 years plus i and people like me have been saying that calgarys housing was over priced..he kept saying and allowing others to say the opposite on his blog..thus there are many calgarians now in a precarious situation..just yesterday he was proud to show the world the fact that students may not find any housing..i wont post a link to his blog..if anyone wants it google it

#164 My_view on 08.20.08 at 12:40 am

I have a friend who experienced the same as the article below, real industry shame.

#165 Zebedee on 08.20.08 at 12:41 am

Calgary Rip Off…I doubt that house was worth $400,000 in 1994. In the late 1990s was living in a gorgeous street in Calgary in a 2700 square foot luxury home that cost under $300,000 to build at around that time, and for which the owner was prepared to accept $300,000 in 1999.

#166 rant in Calgary on 08.20.08 at 12:49 am

Don’t take this personally “average confused guy” #154,
but you are the epitome of the sentiment in Calgary.
Skeptism and confusion are not a good mix in this market.
If you like your home then stay, but be prepared to wait years before the value will equal purchase price or even todays “price”.
I would’nt trust most main stream information released, up until June they were predicting Calgary house prices to increase by at least 3-10% in 08.
“No better time to buy” they said, since then prices have dropped $50k.

#167 EssGee on 08.20.08 at 1:08 am

National Post: Condo boom is ending, report predicts

Check out the line from everyone’s favorite spinster Maureen O’neal

Maureen O’Neill, the president of the Toronto Real Estate Board, said that the advantage to the current softening real estate market is its stability.

“Because it’s declining, it’s correcting, it’s balancing to make it a lot more stable,” she said. “At least now we know what we’re looking at.”

Seriously, that just made my head explode! Does anyone have any idea WTF she just said here? I guess this is what happens when you can no longer spin the facts.

#168 Mike.Slob on 08.20.08 at 1:48 am

Ms.O’Neill is “amaizing” positive woman,
but we have to see facts in 2008:

About Residential Resales in GTA in 2008:

Jan.2008 sales decreased 2.1%
Feb.2008 sales decreased 11.2%
Mar.2008 sales decreased 22.2%
Apr.2008 sales decreased 7.3%
May.2008 sales decreased 16%
Jun.2008 sales decreased 18%
Jul.2008 sales decreased 12.4%
Mid-Aug.2008 sales decreased 13%,avg.price up, and inventory listings are up 28%.

“It’s encouraging to see strong double digits decline throughout all four corners of the GTA”,
I like this woman!…

#169 Tuning out the Realtors on 08.20.08 at 8:43 am

I recently had contact with a realtor who send me one of Ozzie Jurock’s Insider News clips. He went on about how this fall will be an excellent time to buy, that there is very little money left for mortgage lenders to hand out, and since prices are dropping out in B.C., this fall is the time to buy, especially waterfront property. After all, if you’re not smart enough to jump in this fall, you may never qualify for a mortage.
It was a calculated manipulative ploy to suck me in! However, the realtor neglected to note that if I didn’t buy into her game, I’d probably find a real bargain with very little mortgage, if any in a few years. In other words, why worry about not qualifying for a tiny mortgage down the road, that is, if I have to worry about any mortgage at all. A year ago, I am sure this realtor wouldn’t have given me the time of day. Now she is hounding me in hopes I will be a gullible prey. At the same time, she has her own home for sale at a listing of just under two million.
I basically told me her tactics were scaring me, and to please not contact me again.
She knows better and she is shrewd, and assumed I was a greater fool! She’d already been told that I would contact her when I felt ready to buy, but of course didn’t listen and just wanted to inform me of things that had come on the market that I might be interested in.
Is this the epitome of greed and fear or what? As far as I’m concerned, this is someone whose ethics are questionable and therefore I would never do business with them.

#170 wealthy renter on 08.20.08 at 9:11 am


Thanks for the link to the story. Wow, the picture in that article speaks volumes. It might be the perspective of photograph, but it sure looks the condo being build will almost touch the balconies of the adjacent building. Packed like sardines. The other thing that struck me is that balconies in the constructed building look like they are separated by glass. I suppose these are knit-picky details, but I wonder what other “cut corners” the owners had to accept to get their 40-year dream of home ownership and “hopes” of 10% price gains ad infinitum.

#171 Dave on 08.20.08 at 9:40 am

I was looking at some reports on the CMHC website. In particular the purchase/renovations survey report for Toronto.

It showed that based upon answers given, only 4% of 2007 Toronto homebuyers put 0% down. And a similar percentage were planning on 0% down for a 2008 purchase. (there were 17% of the 100,000 respondents who left the answer blank).

#168 Mike.slob, those sales decreases are all over the previous year. So you could have just said “sales down by 12% 2008 vs 2007”.

Also, you neglected to mention that prices were up by 5%. Why did you exclude the positive statistic, and include only the negative ones?

I’m personally still anticipating a downturn in prices. But wanted to contribute some facts to the discussion.


#172 MBS-Economy on 08.20.08 at 9:53 am

dave #145 …. prices increase/decrease in the short term don’t tell us anything. More bigger homes sold results in a higher avg price. You need to look at the long term stats year over year and number of sales is the best indicator.

#173 lgre on 08.20.08 at 10:01 am

does anyone know what the aveage house price in the gta was at the peak of the last crash?

#174 Dave in Calgary on 08.20.08 at 10:14 am

#135 timbo

I agree. My friend recently took over his father’s residential HVAC company in Calgary. The first thing he did was lay off all the hacks and jokers because business was drying up. Now he told me, for the first time in the company’s history (20 some odd years) they have to advertise.

#175 pbrasseur on 08.20.08 at 10:18 am

I read today on french CBC concerning the end of 40 years mortgages that banks are already applying it. However they provide an alternative which is an advance on the downpayment in exchange for a higher rate, a very coslty alternative for the customer but still no risk for the bank because the loan is insured.

#176 Toronto Dude on 08.20.08 at 11:40 am

It was only a matter of time before Garth was blamed for the housing downturn in Canada. This one is blaming him for the crash in Toronto Real Estate sales and increased listings:

Did Garth Turner Impact Toronto’s Real Estate Market?
John Pasalis in Toronto Real Estate News

When economists see a significant and sustained deviation from recent trends in data, they try to find the factor(s) that may have contributed to this shift. For example, the Toronto real estate market experienced a very sudden and sustained increase in the number of homes sold last year. Most economists attributed this increase in demand to the introduction of 40 year mortgages which suddenly made home buying more affordable.

Toronto’s real estate market experienced another significant and sustained deviation from recent trends, this one beginning in April 2008. The chart below shows the number of new listings (homes) available for sale through the Toronto Real Estate Board for each month since 2006. New listings should not be confused with total inventory or active listings which I talked about last week. Total inventory refers to the total number of houses available for sale in any given time period. New listings refers to the number of new houses that came on the market in a particular time period.

Note that the number of new listings for each month in 2007 was quite similar and moved in relative unison with the volume in 2006.

New listing volumes for the first three months in 2008 (green line) started out lower than both previous years, in part due to Toronto’s heavy snowfall this year, but in April 2008 the number of new listings surged by 37% over the previous month and was 18% higher than the volume for April 2007. For each of the past four months the number of new listings on the market have been anywhere from 8% to 18% higher than the previous year.

How do we explain the sudden and sustained increase in the supply of new listings coming on the market?

The Garth Turner Factor

This year Canadian MP and author Garth Turner released his cautionary outlook for Canada’s real estate market titled Greater Fool. Garth Turner warns Canadians that Canada is poised for a housing crash similar to the one taking place in the US. Turner advises Canadians to sell their house now and rent if their home makes up more than a third of their total net worth.

The book was released in March 2008. The following month the number of new listings on the market jumped by 37%. Did thousands of people in Toronto heed Turner’s advice to sell their house?

Turner’s influential book and blog may have played some part in the rise in April’s new listing volume but the heavy snowfall from January to March also played a roll. Many sellers held off on listing their house during the winter months because the heavy snowfall made it difficult for buyers to look for houses.

While the harsh winter may help explain the rise in April’s new listings how do we explain the sustained increase in new listings from May to July? Is this short term trend an indication that more sellers are looking to “cash out” at what they perceive to be the peak of Toronto’s real estate market?

Perhaps, but part of the increase in new listings may be explained by the many price changes we are seeing in Toronto’s real estate market. When a realtor wants to change the price for their listing at 123 Main Street for example, they can either update the listing for that home with the new price or they can take 123 Main Street off of the market and then upload a new listing for 123 Main Street at the new price. The advantage of the later approach is it resets the Days on Market for the house back to 0 making the listing look newer than it really is. One of the problems with this is that both listings would be counted as new listings because they would have different MLS numbers.

Some agents actually use this price changing strategy as part of their marketing plan for selling homes in a slowing market. The agent will list the house at a high price and if the house does not receive an offer within 10-14 days the agent will take the house off of the market and will relist it at a lower price. Even if the agent and seller don’t want to reduce the price for the home, the agent will still take the house off of the market if it doesn’t sell after 10-14 days and will relist it at the exact same price in order to reset the Days on Market. The agent will continue to relist the property every couple of weeks until it sells. It’s not uncommon to see the same house listed up to 4 separate times by the same agent. In this case TREB’s data would show 4 new listings when there should have been just 1.

This strategy to relist the property in order to reset the Days on Market is not new but has probably been occurring more often now than in previous years given the slowdown in Toronto’s real estate market.

Due to the limited data available it’s tough for anyone to say conclusively what’s driving the increase in new listings but I suspect that it’s a combination of the factors outlined above which are all signs of a slowing market. I’ll be keeping an eye on this data to see if this trend continues into the fall or if new listings return to 2006/2007 levels.

#177 Calgary Blog Bunny on 08.20.08 at 11:52 am


Squidly, that was a newspaper story about students not being able to find housing. Again, don’t shoot the messenger. Perhaps you are also threatened by accurate information?

Censored blog? I see your name on there along with opinions and comments across the spectrum. I believe you were the one who posted so much profanity that he had to start moderating comments. This(Greater Fool) is a “moderated” blog. You don’t seem to have any issues with it.

If Bob truman’s information is so bad, why are you are using his stats to make your point in comment #90? You didn’t have any problem posting a link when it suited your agenda.

#178 Sam on 08.20.08 at 12:05 pm

Did Garth Turner impact Toronto’s Real Estate ? By John Pasalis.

This one is hilarious. Did you see the article about yourself by John Pasalis ? This joker is blaming you for the the housing bubble.

#179 Sam on 08.20.08 at 12:19 pm

#180 APCM on 08.20.08 at 12:34 pm

#171 – Of course Toronto real estate prices are up!
Right now we’re at the in-between stage.
Sales are down. But the stuff that is selling is selling at a bit higher than last year (because some greater fools are still getting into the market, although fewer as sales stats point out).

The statistics don’t account for the people who have had their houses up for sale for 3 months and aren’t willing to accept a lower offer for another 3 months. But with a record amount of houses/condos on the market, if these people want to sell, they will reduce and they will reduce soon. I say October, once the panic sets in.

#181 Call_A_Spade_A_Spade on 08.20.08 at 12:47 pm

here’s a great article that summarizes the last 7 years in the US and ‘how we got here’

if Canadians really think that we’re that different and more conservative in our debt consumption, then they’re delusional

#182 brazer on 08.20.08 at 1:00 pm

Canadian consumers are paying more for less

“Don’t be fooled by the headlines, as gas prices lifted nominal sales but controlling for price effects unmasks a sharp decline in the volume of sales,” said economists at Bank of Nova Scotia. “The Canadian consumer spent more in dollar terms during June, but bought less with their money in terms of the volume of goods and services.”

#183 squidly77 on 08.20.08 at 1:17 pm

blog bunny..when i pasted you house gamblers with facts
and you had nothing left to fight me with you resorted to insults and accusations as you have now done here
i have never used profanity as to use that would prove an inferior intelligence level..idiots use profanity because they cant find the right words
if real estate boards were not so paranoid they would see no need to hoard sales information..the fact that i use his pages comes from necessity not desire..i could care less if his site was gone i hour from now..its used as a sales platform..obviously effective as it snared you
the article in the herald trying to scare students into over paying for accommodation was quickly posted on his blog by he himself..he almost seemed happy about there possible grief
i wont respond to your comments any further as you are just trying to carry on a 2 year argument that you have lost time and time again on someone elses blog
get over it..and get on with it

down down in calgary we go

#184 Calgary rip off on 08.20.08 at 1:24 pm

Calgary Blog Bunny:

The central issue is ethics. What Mariot T. at the Herald and many realtors do including Bob Truman is twist the stats to suit their needs of sustaining a bubble. That is the issue Squidly is making, not the stats themselves, although the current statistics about prices are DISGUSTING.

This twisting of stats(by realtors) is unethical for many reasons:
1)It will hurt the economy because people will choose not to come to Calgary and essential services will be hurt. Try to employ the new hospital down south with workers, good luck on that.

2)It leads naive buyers to buy homes they really shouldnt.

3)It leads homeowners to invest in their homes when they are already overextended.

So. Who exactly is benefitting from Bob Truman’s blog? Noone really. When the market crashes the realtors will be suffering, if they arent already.

For example, all over the city prices are down. The real issue is that prices probably wont come back to baseline. The price of a home is disproproportionate to earnings. Therefore the bubble is not sustainable.

You may argue against this. A single family home averaging around $400,000 is really overpriced any way you look at it. Who in their right mind wants to spend that amount when it is cheaper to rent?

The facts “presented” by Ed Jensen and Mario T along with Bob are a delusion.

Its too bad that many in Calgary cant afford those overpriced shacks with the lovely 8 feet around their home and no trees. Some may say move somewhere else. When possible, that will happen, as shown by the negative migratory numbers to Calgary.

In the end, only God knows what will happen. As of present though due to speculator slime and greed, it doesnt bode well for Calgary.

#185 kabloona on 08.20.08 at 5:00 pm

So…..real-estate agent/pumper Pasalis says in March of this year that Garth’s full of it, that there’s not gonna be a slowdown – according to “…respected economists”….

Then when the slowdown that was never supposed to happen actually happens, he blames GT…

Didn’t they blame Senator Schumer for causing a run on IndyMac by suggesting it might be insolvent…??? And guess what…??? It was insolvent…..

The pen is truly mightier than the sword. ;-)

#186 Bill on 08.20.08 at 9:22 pm

Not hearing too much about Vancouver……Mostly Toronto and Calgary. Is Vancouver really imune to this crash? Seems like money is still cheap. Just refinanced at 4.25%….This is keeping prices up. What is the take on where interest rates are going?

#187 Zebedee on 08.20.08 at 11:05 pm

When the crash hits, no decreases in interest rates will keep the prices up. Look at the US.

#188 Andrew toronto on 08.21.08 at 10:22 pm

check this out just came out today I.O.U.S.A

U.S has reacehed a critical point buffet and company helped produce this movie see..

scary stuff

#189 anonymous on 08.22.08 at 12:36 pm

I don’t think the majority of bears will be able to pull the trigger when prices bottom.

It’s not in your nature. You put your money in GIC’s instead of trying to time the stock markets. You didn’t buy years ago (I understand many of you were too young or not in a position to buy). You are risk-adverse. You want guarantees.

And when everybody around you is agreeing with you (a couple years from now), telling you that you are right about the horrible housing market, that is the time that you will be looking to buy.

And that’s going to make you a black sheep AGAIN! Everybody will think you are a risk-taker/loose canon. But it’s the right thing to do.

Don’t underestimate how HARD it will be to buy property. It will feel just horrible.