Year from hell

Source: Whybuywhenucanrent and Seattle Bubble Blog

The point of the post below was to illustrate that residential real estate has precious little inherent value. Rather, it’s a subjective commodity. Land values can escalate wildly, or go to zero. The actual materials a home is constructed from, no matter how irreplaceable, are usually meaningless. People will pay $1 million for a graceless, tasteless, boxy piece of crap on a soulless street because it represents a social goal. Financially, it could be a disaster.

Pitted against this irrationality of real estate is the more ordered, structured, transparent world of financial assets. And while stock markets are just as capable of going to hell as housing markets, investors have liquidity without bidding wars or hormonal young buyers getting in the way.

So, there’s risk everywhere. My argument today is that residential real estate represents far more risk than stocks, bonds and mutual funds. At this moment there is a two-year supply of houses for sale in our major cities, and prices continue to fall while sales collapse. This is not a commodity to own if you happen to need cash. And as all this happens, most people who bought since 2006 with little or nothing down are sliding towards the abyss of negative equity.

Of course, everything gets worse in 2009.

We haven’t even tasted the impact of widespread job losses. Major retailers will disappear in the new year. The car company bailout is nothing but gum in the dike. The federal deficit will balloon hideously, guaranteeing higher taxes four years from now. Oil is going to $30 a barrel. And you’ve seen just the beginning of the real estate meltdown. Wait until all those people who pulled their listings waiting for the Spring market, realize there isn’t one.

It’s entirely possible this economy could tip into a deflationary spiral of the kind we’ve already discussed. Within 60 days, governments in Canada and the US will have thrown everything they’ve got at this mess. If it doesn’t work, stand back. All assets – real and financial – will be blown up.

This is why prudent people are quietly getting ready. Are you?

(BTW, those houses are in Detroit and Vancouver. But you knew that. You’re obsessed.)

76 comments ↓

#1 dd on 12.19.08 at 10:12 pm

“This is why prudent people are quietly getting ready. Are you?”

That is a big punch in one little sentence.

#2 Bruce Wilson on 12.19.08 at 10:21 pm

I’m ready, Garth. Due to personal circumstances my wife and I were living long enough in our empty nest so we sold our house 12 months ago and just rented until we decided where we should retire. We retained our small vacation cabin where we spend the summers.

Now we are cash-rich and asset-poor. Our investments were extremely conservative so we did not endure any market collapse. We are sitting pretty.

Property in Florida is going dirt cheap, and we are waiting for it a to really hit bottom in the next 12 months. In the meantime we are biding our time for the next opportunity.

Any suggestions? What are you doing now?

I’m ignoring Florida, and so should you. Hey, that’s what RVs are for. — Garth

#3 young and foolish on 12.19.08 at 10:42 pm

Getting ready? For what?

I agree, we certainly are in a pickle. But what, really, are our options? Do we take back our country, our polity, from the speculators, or do we retreat into a “Mad Max” apocalypse?

#4 Calgary_rip_off on 12.19.08 at 10:46 pm

Garth things dont quite look like Jericho yet, so no, Im not ready. I have considered getting a crossbow, but thats about it. There are no animals to hunt in NW Calgary. Lately its just been about getting the city trucks to sand properly. That only occurred today(friday).

For the future, check the document at http://www.globalresearch.ca that shows the forecast for the world to year 2025. Look for COAL to be a major player, not oil. Oil will be around for a LONG time, but look for things to start changing around then. More than likely hydrogen power will be around then. Check squidly’s post about oil costs 1998-2002, oil was around $15-$20 per barrel. Enough of that spoonfed crap from the Conservatives saying the oilsands need to be at $38 or more per barrel to function. What a bunch of greasy fools.

So if everything will implode soon, INVESTING becomes a bunch of crap. It doesnt work. What becomes important is actually what you can learn, work at, and actually do. Investing becomes just like posing. Bunch of egomaniac posers saying they control things. Fools. They would be better off playing Texas Hold Em for their investment strategy!

Nothing wrong with $15/barrel for oil. Watch for more greenhouse warming once coal use takes off around 2020. To bring down carbon use you would need a Fascist authoritarian state to implement these controls. How about only have your lights on 2 hours a day? That type of crap? Nah. So with the $15/barrel for oil you can go get your Dodge Charger and drive it. Fast. On ALberta roads with Synthetic oil under the hood.

Garth’s post brings good news to those wanting to buy a house. Once I buy, Im done on this blog. Just want a place to live. If you are one of the potential persons about to be out of work, become a nurse. That also goes for guys. Nothing wrong with male nurses. Good luck on being out of work then. It wont happen unless Canada becomes like Africa.

#5 Andrew toronto on 12.19.08 at 10:49 pm

Garth why 60days ?

Within 60 days, governments in Canada and the US will have thrown everything they’ve got at this mess. If it doesn’t work, stand back. All assets – real and financial – will be blown up.

Is there anything special about 60days and if you where a betting man what percentage chance are you giving this senario to happen 50/50 ..30/70

#6 AAa on 12.19.08 at 11:27 pm

Hey Garth. Sounds like Economegeddon!!!

#7 Orange Whip on 12.19.08 at 11:35 pm

So Garth, what are the prudent people doing?

#8 ThumbsUp on 12.19.08 at 11:50 pm

Great post, Garth, I’d like to believe I’m ready, money bailout is not the solution, I see it as a government gesture showing ‘we’ve tried’. The economy would not have been in this mess if money bailout were the solution.

Looking forward to double checking with your ‘After the Crash’ a month from now.

Merry Christmas everyone, great site.

#9 Waiting for a Deal on 12.20.08 at 12:49 am

Garth,

I know you listed a bunch of things to do to get ready … I have paid off all my debt … renting currently … but I tried to find your blog on what you recommend to do … can’t find it … could you repost it?

Gonna print off “How to be a Vulture”, thought that one was priceless.

Hey Bruce, if you are a non-resident … Florida is a state that will tax you at a much higher amount on your property taxes than a resident. They ding the “Snowbirds”. I understand California and I believe Arizona don’t treat us Northerners that way.

#10 real estate expert on 12.20.08 at 12:52 am

Diablo said…””Vancouver is no New York or Tokyo””

You are correct, Vancouver is superior to both.

…V is not a dying city like NY nor is it overpopulated like Tokyo…it is a Canadian paradise and soon will become the leading financial city for North America.

You keep hearing that first on my postings.

#11 islander on 12.20.08 at 12:55 am

“Pitted against this irrationality of real estate is the more ordered, structured, transparent world of financial assets.”

With all due respect, there is little order, structure or transparency about the stock market.

Companies lie to inflate earnings (and thus share prices) so punters are really gambling on their faith that OTHER buyers think the earnings are real. The Greater Fool Theory applies to equities just as it does to real estate.

Whatever order we thought the stock market had has been exposed as a cheap carnival by now.

That leaves structure, whatever that means. If you mean a mechanism for clearing trades, then yes, structure exists. Until a computer chip melts down and gamblers are prevented from getting their TSX fix for an ENTIRE DAY.

At the end of this debacle – however long that might take – we will emerge on the other side knowing two things: 1. Spending money on a house puts a roof over your head. 2. Putting money in the market is gambling, where the odds are severely stacked in favor of The House.

Alberta has announced it will eliminate the cap on drug costs for seniors who earn more than $22K a year. That’s a poverty level for people who don’t own a home free and clear. Where will these seniors find extra money for drug costs, inflated food prices and rising energy costs? They will melt down their RRSPs.

Housing is dead money for 2-5 years. But it will always be shelter.

Stock markets are dead money for a generation. 20 years minimum.

#12 nonplused on 12.20.08 at 1:58 am

“But you knew that. You’re obsessed.”

Ya, we all are. Hard not to be as the biggest financial event since 1930 unfolds. And Garth, you’ve been obsessed longer, we’re just following the coach’s advice!

Interesting to see a positive comment on RV’s! I bought one primarily because that’s how my family vacations, but I’ve also read when the power goes out they can be a good way to ride out the storm (you need at least a small generator capable of keeping the batteries going and an amount of propane on hand sufficient for the duration. And gas for the generator. Plus a small investment in solar panels say $2000 will actually eliminate the need for a generator except for winter solstice. But they are of no use for that if you store it off your property.)

I just checked Realtor.ca again and the properties I am familiar with in Calgary are now several months old but ask prices are not dropping. Sellers have not given up. The decline in prices is entirely transaction price, list isn’t dropping. Hopeful dreamers.

My landlord interestingly suggested extending the lease. His original intent was to sell in the spring but I think he’s thinking now to hold out another year. But I don’t think that will help unless we have massive inflation that flows through to wages. I think all asset classes are doomed for the next 2 years except necessities. Stock market dead cat bounce excepted but if you buy put a 10% stop loss on it electronically so it sells without your further permission when the thing acts badly.

#13 mrg on 12.20.08 at 2:18 am

Funny you mention 60 days, these guys are predicting March 2009. They had an official warning of the Sept/Oct stock market collapse and say their track record is 80% accurate. Now I’ve been following blogs and market news for several years and this is one of the more troubling and precise pieces I’ve read. After reading this tonight, I definitely needed to go out for a beer.

http://europe2020.org/spip.php?article576&lang=en

#14 Toronto Market Watcher on 12.20.08 at 2:28 am

“Wait until all those people who pulled their listings waiting for the Spring market, realize there isn’t one.”

Garth, I couldn’t agree with you more. With respect to the central core Toronto markets (ie. Lytton Park, North Toronto, Lawrence Park, Sherwood Park, Leaside, etc.) currently in the $800k range and up, sales transactions have fallen off a cliff in an alarming hurry this fall. Only those serious and wise vendors who adjusted their selling prices by 25% or more from their 2007 highs ended up with a “SOLD” sign on their front lawn. Those who pulled their listings with hopes of better market conditions are either in denial and/or are seriously misguided and have extreme difficulty in understanding the basic deteriorating economic fundamentals you have clearly laid out. I foresee a huge increase in new central Toronto listings starting in late January. When serious vendors continue to reduce their selling prices to move their properties, other vendors who were previously in denial and want or need to sell will begin to understand the new market reality and will follow.
I am in constant contact with several veteran realtors who work the some of the aforementioned Toronto neighbourhoods and whose opinions I have valued over the years and NOT one of them sees market conditions improving over the next 18 months or more never mind this spring. In fact, there are constant reports of widespread anxiety in their offices as many less established agents have become concerned about their income prospects and are looking for alternative careers.
We live in challenging, unpredictable times and are clearly moving into unchartered territory. Hang on for the ride….

#15 Seadoo-bear on 12.20.08 at 2:33 am

I’m not sure if I’m ready or not. My house on an acre in the Lower Mainland is paid for. I’ve got a few hundred k invested in church mortgages. (Churches do well in bad times) I’ve got lot’s of skills. I don’t have a job presently, but I have a few little deals cooking. I’m glad I’m on the outside wishing I was in, instead of inside wishing I was out.
I’m not sure about my kids though, one is renting and the other has a pretty high mortgage payment and is in the renovation trade. Oh well maybe I’ll go to Mexico for awhile in the New Year and sit on a beach and watch Canada from there.
Regards, Henry

#16 Mike B on 12.20.08 at 3:02 am

Could you indicate what you mean by “getting ready”?

#17 Helmut on 12.20.08 at 8:04 am

# 16 Mike B….Could you indicate what you mean by “getting ready”?

Garth suggested before to get a real dog etc. My Rotti is 3 months old now and should be grown up in 60 days. He might have to get used to eating Chef Boyardee when things go sour…but what the hell I hear Rottis are better then shot guns.
Have a nice Christmas everybody :)

#18 AJW on 12.20.08 at 8:47 am

All the squirrels better watch out for Econo-mageddon!

#19 Alex Curylo on 12.20.08 at 10:05 am

@ young and foolish:

“…or do we retreat into a “Mad Max” apocalypse?”

You should be seriously considering the possibility.

We know already that because of the credit crisis grain farmers haven’t been able to fertilize their crops properly this fall, and the infrastructure isn’t there to catch up in the spring. That’s not a maybe, that already has happened. So at least calorie-wise if not by tonnage, 2009 is going to be a famine year. Who knows how bad it will be, but it won’t be good.

The real doomsday scenario is that supermarkets start closing. Those overflowing shelves you walk along every few days? They’re dependent on revolving credit. If supermarkets can’t find a bank solvent enough to lend against inventory, they don’t make their next payroll, or order more food. Calamity ensues.

I could go on for a while, but let’s just put it this way: If you’re not seriously preparing for food rationing and martial law in urban centres within the next few years … you should get on that.

#20 md on 12.20.08 at 10:13 am

Hey Garth great post. im in the construction sector (resedential framing) and i can tell you first hand its getting ugly out there. Im hearing stories from the the site supervisor about new home owners just walking away from their deals and their deposists. 2009 is gonna be a bad year for people in my trade.

Thanks for the great tips, keep up the good work

#21 Future Expatriate on 12.20.08 at 10:17 am

Garth, knowing where those houses were is not obsession… just being aware, thanks to you and the handful of bear blogs that were around before.

And #10: What an idiot. You haven’t seen what a dead city is until you see Vancouver after the Olympics.

Financial capital of North America? For crackheads, and even that’s a maybe.

#22 John McLeod on 12.20.08 at 10:39 am

OT:

Looks like an ABCP bailout of about $8 billion in taxpayer money to start (twice the size of the auto-industry one) is a done deal today. Comments?

#23 Trevor from Vancouver on 12.20.08 at 10:41 am

Vancouver is a great city but the Olympics and the Real Estate boom has really taken the arrogance of it to a level which is unprecedented. With Asian imports dropping, the movie/entertainment industry will not be expanding during a recession, and with construction slowing down in every sector the Lower Mainland is in for a tough go of it. Thankfully because Vancouver does have some diversification industry wise it will not be as hard hit as a Calgary, Edmonton or a Saskatoon. Saskatchewan especially is going to be hit extremely hard as being a native of the great province I am really unsure what was actually driving the boom in the first place…

#24 dboy on 12.20.08 at 11:10 am

Interesting site that puts the nature of RE prices into perspective:

http://flippersintrouble.blogspot.com/

#25 Yikes on 12.20.08 at 11:20 am

@Garth et al,

Thinking about travelling for about a month in Q1 2009, central and south America.

Given what’s happening, is it better to stay put, or delay travel plans?

#26 WestCoast Girl on 12.20.08 at 11:36 am

WRT: #9 Waiting for a Deal…seconded – can someone repost or Garth can you please repost?

Helmut #17: Our dog is growing fast too =)

#27 Gord In Vancouver on 12.20.08 at 11:38 am

#23 Trevor from Vancouver

Thankfully because Vancouver does have some diversification industry wise it will not be as hard hit as a Calgary, Edmonton or a Saskatoon.

What makes Vancouver’s economy more diversified than its western counterparts? Calgary, Edmonton, Sask. have more manufacturing and oil/mining industry-related jobs than Vancouver does.

I’m old enough to remember how Vancouver was 30 years ago when its economy was much more diversified than it is now.

#28 AAa on 12.20.08 at 11:46 am

Auto Bailout. Let’s hope this will work because we
all know what will happen. Oshawa, Hamilton, Brampton and Windsor will become the new downtown Detroit.

If the big three become bankrupt, restructuring only means relocating these jobs outside Canada to be more competitive and most likely to Mexico. Once they’re there they ain’t coming back….all 60,000 plus
high paying jobs.

#29 Ultraman on 12.20.08 at 11:55 am

mrg, that’s quite the find you got there. Very interesting article. The link is under #13.

Yes, a few beer is in order. I’m also going to yank my money out of Mutual Funds (equities) on Monday.

I’d be curious to hear from someone familiar with their research in term of credibility and all. Thanks

#30 bob the builder on 12.20.08 at 11:58 am

what is driving the boom in sask you ask? the previous speculation that oil prices will continue to go up and thus justify oil sands exploration, yeah that turned out well, and the never ending supply of low and minimum wage jobs that no one wants. the media uses these statistics to boost the province, but never really divulging that these are crap jobs that 14 and 15 year olds are the only ones that are applying for and getting. there is your service industry folks! and all your compaints about bad service will fall on deaf ears as businesses are so desperate that they will hire anyone with a pulse. of course no one could actually live off these wages unless they are being supported by mommy and daddy as well. and the immigrants that come here and take on some of these service jobs are wondering why they traded poverty in their own country for poverty in this country, but with minus 38 celsius weather as an added attraction.

#31 Gord In Vancouver on 12.20.08 at 11:58 am

Today’s Post By Garth:

That’s a scary graph. Skiing anyone?

Calgary’s real estate market was the first one to drop – and encounter bargain hunting. It’s depressing to see that Calgary’s bottom feeding period lasted only 9 months and that this market’s downwards trend has continued from where it left off.

Vancouver prediction:

In spring 2009, a huge dump of new listings will create a short term price drip in the Vancouver market. This price decline will create a “bargain hunting” trend, similar to the one that occurred in Calgary, which will stabilize or increase housing prices.

Vancouver speculators, relieved that they’ve eliminated or minimized their losses, will unload all that they can into this great selling opportunity. As Calgary demonstrated, real estate markets that were subjected to heavy speculation will have a much tougher time benefiting from bottom feeding.

#32 squidly77 on 12.20.08 at 12:04 pm

a bitter calgary spec buyer sounds off on the
http://albertabubble.blogspot.com/

@B-sucks said…
that’s right realtor slayer. This whole tsunami isn’t going to gobble up just greedy edmonton home owners…those horrible bastards and their quads, and big screens, and bourgeois asperations…it’s going to get YOU too! You’re going down too, with them, because of them! You won’t be able to borrow two nickels to buy a shoebox in edmonton…no one will! It feels like Rome burning! Recovery won’t happen until long after these times are a distant memory. But you have to catch up…this blog WAS about greedy over leverage homeowners not letting people like you into the market, then it was about being bearish about prices when they were stratospheric, then this blog was about high-fives all around as the RE bears here all cheered crippled RE “investors”, people you know, neighbours maybe even family.

NOW this blog is about doubting whether you will remain untouched by this. Realizing that the catastrophe you cheered with such gusto is heading right for you. It swallowed up everyone else and now it’s gonna eat you too, and squidly77 and gloria and everyone else here. And as one who has made peace with losing all my flaming wealth, I’ll be cheering as this board becomes the “anybody hear of any jobs out there board”, and then the “my EI just ran out board” and then the “got any recipes for ketchup soup board”. Just checked the edmonton temps for today…brrr, cold…here’s a tip for the impending Armageddon thats gonna get you all librarys open at 8 am and are a warm place to spend unemployed homeless days. Oh and trust me on this one having experienced it myself; the mcdonalds dumpsters are a treasure trove of clean disposed food, as the stuff that is older than ten minutes is thrown into the garbage in it’s wrapper…easy to dig out and reheat over a hobo stove

December 20, 2008 8:41 AM

#33 brazer on 12.20.08 at 12:52 pm

PM, McGuinty pledge $4B in auto aid
http://www.thestar.com/news/canada/article/556865

Prime Minister Stephen Harper and Premier Dalton McGuinty have announced a $4 billion (Cdn.) bailout for General Motors Canada and Chrysler Canada.

Following the $17.4 billion (US) rescue package announced yesterday by President George W. Bush, the two leaders this morning announced the long-awaited deal.

“This is a regrettable but necessary step to protect the Canadian economy,” the Prime Minister said.

#34 JET on 12.20.08 at 12:56 pm

Here are graphs for the “deals fallen through” numbers that I posted a few posts back:

http://thenumberstheydontpublish.blogspot.com

I hope to update them over time, and perhaps add other metrics.

#35 Le deuxieme souffle on 12.20.08 at 1:00 pm

=== grain farmers haven’t been able to fertilize their crops properly this fall, 2009 is going to be a famine year.===

Oh goody I hate Weetabix – far too crumbly and messy to eat. I’ll have squirrel with eggs.

My American bigshot is taking a 20% cut in his pay and management 7.5% for 2009. No more double-up on 401K from the company until this mess is over.

#36 Kelowna Gal on 12.20.08 at 1:34 pm

We are so glad that we have did not buy in 2006. We have always lived well within our means and will continue to do so. I believe we are ready. However with watching the news, reading blogs, etc., I wonder if we will ever be ready for what is coming????

On a more positive note I’d like to wish everyone Merry Christmas……….or if that offends you, Happy Holidays.

#37 a renter on 12.20.08 at 1:55 pm

Great post Garth

Fully agree re: “Wait until all those people who pulled their listings waiting for the Spring market, realize there isn’t one.”

The market I watch (read obsessed!) is Toronto Moore Park / Rosedale, we sold in Feb. This market pretty much stalled in June, followed by essentially zero sales here since mid Oct. Price drops seem to have no effect. A few have given up, presumably to try again next spring.

So I think you’re right — in spring the stale inventory will be joined by new listings, and re-listings. I suspect that only serious price drops (several hundred k) will get things moving

P.S. my original plan was to jump back in when prices dropped enough. Now not so sure…renting has some real advantages!

Merry Christmas

#38 ACS on 12.20.08 at 1:58 pm

Here is the link to on “How to be a Vulture”

http://www.greaterfool.ca/2008/11/26/how-to-be-a-vulture/

#39 Makeorbreak on 12.20.08 at 2:03 pm

Yikes, I usually travel in the winter to some warmer climtes. However this year, I am not going anywhere. I gather a lot of people that lost their jobs won’t be travelling either. So there will be lest tourists hence more unemployment in these countries (read more crime). The last thing you want is a few dozen bandidos hijacking your hotel.

#40 rantenki on 12.20.08 at 2:05 pm

Short. F#$king. Everything.

SRS (ultrashort proshares real-estate) took a bath when the fed cut the interest rate to “free”, combined with some hope about the new president, and the auto bailout. Now trading at an all time low, right before CRE stocks are going to implode due to commercial vacancies after the holiday season.

No, I don’t work for proshares, but I am short US commercial RE, in a big way.

#41 BILL GATES on 12.20.08 at 2:37 pm

Hey, I have about USD25000 in my pocket. What should I do with it? Invest in the stock market? Put it as downpayment for a house?
Thanks.

#42 Jeannie on 12.20.08 at 2:47 pm

Sold everything two years ago (thanks Garth)… Moved outta Calgary, bought nice little ‘Casa’ (all cash) in Mexico.
No heating bills, yearly property tax $129.00 dollars.. no,not a misprint.
We pay much reduced Canadian taxes as expats..still have Canadadian bank accounts to collect the pensions.

Cheap, abundant fresh fruits and vegetables, even cheaper weekly farmers markets in the smaller towns.

Hundreds of happy retirees from Canada,the US. and Europe.
English speaking clubs, newspapers…we have Costco,Walmart, Sears,Best Buy,McDonald, sophisticated shopping plaza’s, gated communities, etc., this is not the Mexico of 20 years ago.

Mexican businessmen and domestic workers are very happy to do business/or be employed by us.
Yes, I’d say we’re ready for what lies ahead.

We need pix. — Garth

#43 dekethegeek on 12.20.08 at 4:02 pm

#10 Real Estate “Expert”
Please stop blathering on about how Vancouver is going to be a Major Financial Mecca. It only proves to everyone what a total ignoramous you are. Yes the city is beautiful, clean, etc.etc. but your still ignoring a basic fact.
People here in Lotusland consider a 5 hour work day tough enough.
Financial Centers are cities like London, New York, Geneva, where the movers and shakers get to meet for lunch , dinner, at the theatre, the Art Gallery, Museums, etc.etc.etc. ( are you getting it yet? These people live. breath and eat finance. Its not a 9am to 3pm job. Its nonstop work,work ,work.
Why would anyone with international savvy move to a Hick town city that has riots because they dont win the Stanley Cup?
Until Surrey has been neutered,nuked and paved. The #1 highway is widened to handle more than 3 lanes each way( yes folks our major interurban connector is a 6 lane parking lot during rush hour). And idiots like you actually travel further east than Mission, further south than Vegas and further west than Hawaii. We will continue to to have ridiculous statements like yours clogging an otherwise informative website.
Vancouver a financial center.What a joke.

#44 real estate expert on 12.20.08 at 5:01 pm

Ohio, Michigan, Rhode Island, FLORIDA and CALIFORNIA going into Bankruptcy…

http://globaleconomicanalysis.blogspot.com/2008/12/california-implodes-in-multiple-ways.html

Canadians should consider themselves very lucky…it is the best G7 country to be living in under these circumstances.

…and did I ever mention that Vancouver will become the financial/trade capital for Canada and also for North America?

It will…you heard it here first…over and over, ad nauseum…because it is true.

#45 Jeannie on 12.20.08 at 5:01 pm

Garth..you need pix ? That would be blowing my cover, and all those frozen folk looking for a free vacation would descend on us like locusts.
Nah..but here’s a hint…. Google focusonmexico.com
then come see for yourself.

#46 real estate expert on 12.20.08 at 5:16 pm

dekethegeek & gordfromvancouver

I said Vancouver as the financial centre…Surrey is not Vancouver.

New York, London have started slow deaths…Vancouver is the gateway to the far east…China, Japan, Korea, Indonesia and India access North America through New York…No, through London…No, through Vancouver…Yes.

Our city is the envy of the world…no doubt about it

#47 Jake on 12.20.08 at 5:21 pm

Calgary_rip_off
You think your crossbow is tough, wait till you get a load of my steel boomerang. I have to wear a thick leather glove just to catch the SOB. Just last week some skinhead tried to catch it in midflight and it lopped off three of his fingers. Am I ready for the future? I would have to say yes.
Oh yeah, thanks to Grande Prairie girl for the list of the 100 essentials.
Still Condos going up like crazy here in Edmonton (Are we nuts or what?)

#48 Future Expatriate on 12.20.08 at 5:56 pm

#41: RE: focusonmexico.com.

Oh great, another 8 day “Jim Jones” sales trip. Just show us the damn floorplans and the prices so we can compare before the salesmen hound us 24/7 with a unique no sleep “cult indoctrination” experience that will make us too tired to comparatively shop and end up paying double the going rate elsewhere in the town.

Buyer beware!

#49 Sularezi on 12.20.08 at 6:04 pm

This sucks. I mean it.

#50 dekethegeek on 12.20.08 at 6:22 pm

#45 Real estate “Expert”
Dude ! Stop smoking BC Bud ! Switch to Crack !
Stick to real estate!
Stop making predictions ! Your starting to sound like someone from Toronto ! ” Our city is the Greatest. blah,blah,blah.”
Pass the joint and go for some chicken wings at the nearest Cactus Club and tell the waitresses your theories. They will probably believe them.

#51 Jeannie on 12.20.08 at 6:32 pm

Future Expats…there’s no real estate being offered for sale , there are no floor plans to examine, this is an exploratory vacation for those who want to see the area with a view to retiring here.
For those looking to buy property,there are opportunities to meet with other Canadians who can offer their perspective.
Many retirees here choose to rent, it’s a renters market just now, and almost anyone will tell you that one should rent for a year before making any final decisions.
Mexico is not for everyone. Some retirees miss their families, or the grandkids, or they find it too ‘foreign” and can’t adjust.
There are myriad reasons why it’s best to ‘taste and try before you buy’. This is not for everyone.
Please re-read before jumping to conclusions.

He’s just cold. — Garth

#52 landlord on 12.20.08 at 6:35 pm

there’s a lot of gloomy predictions here. but some people might want to gear down before packing it up and heading for the hills. if you’ve got a job and you’re not missing meals then don’t lose sleep.

famine for 2009 – might be getting a little out of hand. look at your wallet (personal circumstances) if they are ok then don’t sweat it. broader markets have less impact than your own personal circumstances.

Garth love the blog, you seem to be pushing a lot of people to rent. do you think landlords will do well in these times. thanks,

Landlords are screwed. Rents falling while taxes and utility bills rise. There’s a massive renters’ market coming. — Garth

#53 jelly on 12.20.08 at 8:19 pm

I’m dying to get into the Victoria real estate market when it bottoms out in a few years.I hear a lot of good things about it. Can anyone explaing to me why it is so appealing to people and so bloody expensive?
It seems like it is a great family place and I certainly do not mind a bunch of old people.That’s pretty much all I know about it…
Comments?

#54 Derrin on 12.20.08 at 9:57 pm

Great graph Garth!

Real Estate in these markets is definetly dead for awhile.

I can’t help laughing at THE REAL ESTATE EXPERT.
Vancouver is going to be a financial centre.
Funny stuff.
Friend you should visit a few of the cities you mentioned.
These are big hubs for finance and there downtown areas aren’t condo retreats. Good luck though….let me know when a head office opens up in downtown Vancouver. Funny stuff.
Stick to selling condos and over priced houses to the stoned Vancouverites.

Cheers,

#55 Tony on 12.20.08 at 10:36 pm

#11 islander…well said!

#56 kos on 12.20.08 at 11:13 pm

Garth,

Any tips for negotiating with a landlord. I am looking to rent a bigger place. Would like to defer because I also think a renters market is up and coming. But need to move soon. Currently, landlords and CREA think they have leverage over potential tenants by asking for stupidly high rents to pay for their “greaterfool” purchases. Too bad. I am looking to be a “Renting” vulture before a buying vulture (too soon for that). Tables have turned.

thnx

#57 real estate expert on 12.20.08 at 11:20 pm

“”Feds don’t know Olympic security costs: Chris ShawGo to full postOlympic critic Chris Shaw had to resort to a Donald Rumsfeld-like tongue-twister to describe why the federal government has not updated the security budget for the 2010 Games from its 2002 figure of $175 million.””

…For all I care, cancel the Olympics…spend the $200 million on more infrastructure….which makes our fare city an even more appealing future financial/trading gateway with Asia.

…and if the Feds can give $4 billion for those “centre of the earth” Ontarios auto industry… how about giving Vancouver $4 billion to build new bridges…adds toward the inevitable Financial/trading gateway with Asia.

#58 wealthy renter2 on 12.20.08 at 11:48 pm

#4 Calgary rip off: Great link. Answered my suspicions.
#52 @Garth2: I have the same addiciton. It does get tiring.

#59 squidly77 on 12.21.08 at 1:02 am

famine for 2009 – might be getting a little out of hand. i read your post before going out for dinner
i looked around the restaurant and it seems a good famine would do a lot of people some good..not to mention the health care savings..

#60 Happy Renter in North Van on 12.21.08 at 1:09 am

Gotta admit Garth is great at marketing the latest “concept du jour”… Chapeau, mon ami! Here’s a little gem I got off the internet…

“Garth Turner is the CEO of one of Canada’s fastest growing multimedia companies. Millenium Media Television Enterprises produces and owns several highly-successful television programs, such as Investment Television, Linda’s Money Show, Dot.com Television, Real Estate Television and Mutual Fund Television.”

What’s next Garth – Gloom Television!

I sold that company in 2005. — Garth

#61 Another Albertan on 12.21.08 at 2:17 am

Christmas party anecdote from Calgary:

A major oil and gas service company is looking at options to consolidate its operations – they are spread between 4 different downtown offices. Word hits the street and the building owners and developers start courting the tenant’s representative. One owner/developer is offering 330% of the normal per-sqft commission rate as an incentive to the rep. On a quarter-million square feet, this is not chump change. Someone needs a new tenant and fast…

Also, the price for run-of-the-mill “decent” office space has been dropping hard and fast. My contact indicates that the plunge from $38 to $30/sqft has occurred in less than 3 months. My contact say “I don’t want to be the guy who does a deal at $25 or under… but at the current rate, it is simply a matter of time.”

#62 Bobby on 12.21.08 at 2:40 am

Commercial failure underway
http://www.calgaryherald.com/business/Increase+Calgary+available+office+space+omen+CBRE/1081811/story.html

#63 David on 12.21.08 at 2:44 am

Financing a deficit with a zero interest rate policy might well create the necessity for hefty tax hikes. The effective yields on long term government debt at the moment offers the enticing possibility of doubling your money every 5000 years. The flight to risk free quality is priceless.
Families calling the bottom on housing far too early are as equally susceptible to the negative equity trap as those who bought in 2006 and will be part of the second wave of the housing collapse.
Alberta is a high cost producer of oil and $30 a barrel will guarantee a supply destruction in the province, no question. Projects are being thrown on the shelves every day of late, as the return on investment looks more sour by the day.
Housing is no great store of value, unless the persons happen to be Conrad Black and Bernard Madoff who used their Palm Beach homes to help them meet bail conditions.

#64 Diabolo on 12.21.08 at 3:51 am

real estate expert ….
Please stop the cool-aid party…
Olympics is the only thing holding vancouver barely…
Wait for the final ceromony !
You heard it here first.

#65 booboo on 12.21.08 at 3:57 am

#42 Deke the Geek
Buddy, you’re bang-on with your comment. I work in finance in London and I know plenty of people who work 80 hour weeks – it’s the norm, not the exception. I’ve also lived and worked in Vancouver and you’re right, people there think 35 hours is a long week. Another point to the moron real estate expert: Flights from London to the far east are no further than from Vancouver to the far east, so much for your theory about proximity. Do us all a favour and go away!

#66 brazer on 12.21.08 at 9:04 am

Nearly 1,000 workers at Saskatchewan mines face eight-week layoff
http://www.thestar.com/Business/article/556603

SASKATOON–Shares of TSX heavyweight Potash Corp. fell more than 5 per cent in early trading yesterday after the fertilizer giant lowered 2008 earnings guidance, citing reduced demand for crop nutrients, but its shares finished the day higher after pending layoffs were announced at its mines.

#67 Canadian Ranger on 12.21.08 at 9:43 am

Relocating and just returned from a House Hunting Expedition in Northern Ontario.

Listing Prices haven’t dropped!

I stated my low ball price and he immediately replied with not too many on the market. Not even a wink at plus/minus 50K.

RE Agent wanted me to get a big fat Mortgage from his Broker Buddy because my pre-approved was too low.

He wanted to show me parts of town I did not like.

So I fired his @$$ and told him I will wait for the crash.

What is the mechanism that triggers these pecker heads to concede and lower the damn price?

Cheers

Never talk about what you’re going to pay. Just write up an offer and let the vendor react. — Garth

#68 real estate expert on 12.21.08 at 9:58 am

Darin, Diablo, Booboo, Dekethegeek…when you include name calling and lower common denominational language, your “supposed” rational arguments fall the wayside.

You guys dont speak for the Asians…do you.

…Lived in TO for forty years…w/ last eighteen on the North Shore of Van.

One simple factoid…location, location, location…as in real estate.

…the world’s horrendous future…look around at the 6-7 G-20 countries…all overpopulated…with one or many other negatives to boot.

…Ontario/Michigan/Ohio/Pennsylvania is a simple example of an unemployment virus about to expand.

Stop with the name calling…use facts…New York, London, Toronto are last century.

Vancouver is new century.

Everything and everybody from Asia enters thru Vancouver.

#69 Future Expatriate on 12.21.08 at 11:08 am

Cold? Not where I am. Try 117Ëšf summers… why do you think I’m emigrating north?

#70 Makeorbreak on 12.21.08 at 11:20 am

Isle tourism drop nears Great Depression levels

The industry heads for its worst annual plunge in 75 years

A 15.9 percent decline in visitor arrivals in November plunged the year-to-date performance for the state’s visitor industry to its worst recorded 11-month level and may have put it on track to experience its worst year, in terms of percentage decline, since the Great Depression.

Hawaii’s lagging visitor industry, which has seen its visitor count fall by 10.2 percent through November, may fall below 2001 levels for the year, said state Tourism Liaison Marsha Wienert.

The state hasn’t experienced such a major 11-month drop in arrivals since 2001, when the count through November was off by 8.7 percent, Wienert said. The year-to-date plunge in arrivals for 2008 already has surpassed the 9.3 percent annual drop of 2001, she said.

“We had estimated that we’d be off by 10 percent for the year, but right now it looks like it’s going to be a little more,” Wienert said.

During the Great Depression, Hawaii’s annual visitor counts dropped by 15.9 percent in 1930, 15.4 percent in 1931 and 34.3 percent in 1932, she said. Eleven-month records were not available for those time periods.

Hawaii visitor arrivals plunged 15.9 percent in November to push the year-to-date decline to 10.2 percent — the worst recorded 11-month dip ever in arrivals for the state’s lagging tourism industry.

VISITOR ARRIVALS
The number of visitors arriving in Hawaii by air in November with the percentage change from the same month last year:

Visitors Pct.

Domestic 185,045 -15.7

International 120,482 -15.6

Total 485,544 -15.8

Grand total* 496,877 -15.9

By Island

Oahu 305,527 -15.7

Kauai 68,377 -27.2

Lanai 5,216 -33.2

Maui 143,627 -20.1

Molokai 3,880 -38.1

Big Island 93,567 -20.0

* Includes arrivals by ship
Source: Department of Business, Economic Development and Tourism

According to state historical data, Hawaii has not experienced such a major 11-month drop in arrivals since the year-to-date visitor count fell by 8.7 percent following the terrorist attacks of Sept. 11, 2001.

“This is our deepest 11-month decrease,” said state Tourism Liaison Marsha Wienert. “We’ve got some challenges ahead.”

The visitor industry offered a plethora of holiday-related specials last month; however, despite seeing a small pickup in Thanksgiving-related traffic, the state posted its sixth straight double-digit drop in visitor arrivals, Wienert said. As a result, it is likely that the state’s visitor count will fall below the 9.3 percent annual decrease posted in 2001, Wienert said.

“We had estimated that we’d be off by 10 percent for the year, but right now it looks like it’s going to be a little more,” Wienert said.

Members of Hawaii’s visitor industry have said that they expect to see some pickup during Christmas and New Year’s; however, they do not think that they will see recovery in December or even in the first half of next year.

“There’s softness everywhere,” said Barry Wallace, executive vice president of Hospitality Services for Outrigger Enterprises. “We are concerned as we move into next year.”

If performance for the state’s visitor industry continues to move downward, 2008 may be the worst year, in terms of percentage declines, since the Great Depression, Wienert said. Visitor counts to the islands dropped by 15.9 percent in 1930, 15.4 percent in 1931 and 34.3 percent in 1932, Wienert said. Eleven-month records were not available for those time periods.

While the state posted arrivals growth in January and February, the credit crunch, the housing crisis and the overall downturn in the global economy since have caused even avid travelers to become skittish about long-haul leisure trips. Visitors that come now are often looking for bargains. As a result, other leading tourism indicators in November outside of arrivals were down, too.

Total air visitor expenditures dropped 15.3 percent to $805.3 million in November, while average daily spending declined to $179.50 per person and total visitor days for air and cruise visitors decreased 12.5 percent, according to the latest statistics released yesterday by the Department of Business, Economic Development and Tourism.

Destinations across the globe are experiencing similar challenges due to the lack of travel demand; however, Hawaii’s problems are compounded by its sheer distance. Only kamaaina are poised to take advantage of weekend trips in the islands, and even they cannot drive to the destination.

Indeed, all of Hawaii’s market segments, except the meetings, incentives and convention market, saw falling arrivals last month. Year to date, most market segments except for Canada have posted double-digit declines in arrivals.

The visitor count from the U.S. East plummeted 14.4 percent for the month and 11.2 percent for the year. However, perhaps more troubling for Hawaii’s visitor industry was the continued severe decline in its top U.S. West market, which saw air arrivals drop by 18 percent in November and by 14 percent for the year.

“Many of the markets that we rely on the most like California, Arizona and Nevada are among those that have been hardest hit by the credit crisis and the declining home values,” Wallace said.

Hawaii’s most important international market, the Japan market, took a 20.3 percent nose-dive in November, bringing the year-to-date drop to 10 percent. Going forward, traffic from Japan to Hawaii is expected to be down by 8.9 percent during the New Year’s holiday, according to a forecast from Japan Airlines. The declines are due to an 11.4 percent drop in seats from last year and continued economic challenges, the company said.

Arrivals from Canada, traditionally Hawaii’s most faithful fall market, fell 7.1 percent in November. The market was up 5.9 percent for the year, but was not able to offset other shortfalls.

Cruise ship arrivals were down 21.9 percent for the month and 21.8 percent for the year as the market continued to grapple with the loss of two Hawaii home-ported NCL America ships and fewer stops from foreign-flagged ships, Wienert said.

Decreased cruise traffic was responsible for an estimated 50.2 percent of the decline in visitors felt by the Big Island, 45.9 percent of Kauai’s drop, 32.4 percent of Maui’s decline and 20.6 percent of Oahu’s fall, she said.

Hawaii’s neighbor island markets were hit hard last month by the drop in cruise traffic, seasonal island preferences, rising interisland airfares and reduced flight options.

“There has never been a time like this in Hawaii’s visitor industry,” said Ed Hubennette, Marriott International’s vice president of North Asia, Hawaii and the South Pacific.

It is impossible to pinpoint a market turnaround given the confluence of factors affecting Hawaii’s tourism industry, Wienert said.

“This isn’t a singular event so it’s going to take longer to recover,” she said. “We just have to be patient, but that’s hard when people are being laid off.”

Hawaii visitor arrivals plunged 15.9 percent in November to push the year-to-date decline to 10.2 percent — the worst recorded 11-month dip ever in arrivals for the state’s lagging tourism industry.

VISITOR ARRIVALS
The number of visitors arriving in Hawaii by air in November with the percentage change from the same month last year:

Visitors Pct.

Domestic 185,045 -15.7

International 120,482 -15.6

Total 485,544 -15.8

Grand total* 496,877 -15.9

By Island

Oahu 305,527 -15.7

Kauai 68,377 -27.2

Lanai 5,216 -33.2

Maui 143,627 -20.1

Molokai 3,880 -38.1

Big Island 93,567 -20.0

* Includes arrivals by ship

Source: Department of Business, Economic Development and Tourism

According to state historical data, Hawaii has not experienced such a major 11-month drop in arrivals since the year-to-date visitor count fell by 8.7 percent following the terrorist attacks of Sept. 11, 2001.

“This is our deepest 11-month decrease,” said state Tourism Liaison Marsha Wienert. “We’ve got some challenges ahead.”

The visitor industry offered a plethora of holiday-related specials last month; however, despite seeing a small pickup in Thanksgiving-related traffic, the state posted its sixth straight double-digit drop in visitor arrivals, Wienert said. As a result, it is likely that the state’s visitor count will fall below the 9.3 percent annual decrease posted in 2001, Wienert said.

“We had estimated that we’d be off by 10 percent for the year, but right now it looks like it’s going to be a little more,” Wienert said.

Members of Hawaii’s visitor industry have said that they expect to see some pickup during Christmas and New Year’s; however, they do not think that they will see recovery in December or even in the first half of next year.

“There’s softness everywhere,” said Barry Wallace, executive vice president of Hospitality Services for Outrigger Enterprises. “We are concerned as we move into next year.”

If performance for the state’s visitor industry continues to move downward, 2008 may be the worst year, in terms of percentage declines, since the Great Depression, Wienert said. Visitor counts to the islands dropped by 15.9 percent in 1930, 15.4 percent in 1931 and 34.3 percent in 1932, Wienert said. Eleven-month records were not available for those time periods.

While the state posted arrivals growth in January and February, the credit crunch, the housing crisis and the overall downturn in the global economy since have caused even avid travelers to become skittish about long-haul leisure trips. Visitors that come now are often looking for bargains. As a result, other leading tourism indicators in November outside of arrivals were down, too.

Total air visitor expenditures dropped 15.3 percent to $805.3 million in November, while average daily spending declined to $179.50 per person and total visitor days for air and cruise visitors decreased 12.5 percent, according to the latest statistics released yesterday by the Department of Business, Economic Development and Tourism.

Destinations across the globe are experiencing similar challenges due to the lack of travel demand; however, Hawaii’s problems are compounded by its sheer distance. Only kamaaina are poised to take advantage of weekend trips in the islands, and even they cannot drive to the destination.

Indeed, all of Hawaii’s market segments, except the meetings, incentives and convention market, saw falling arrivals last month. Year to date, most market segments except for Canada have posted double-digit declines in arrivals.

The visitor count from the U.S. East plummeted 14.4 percent for the month and 11.2 percent for the year. However, perhaps more troubling for Hawaii’s visitor industry was the continued severe decline in its top U.S. West market, which saw air arrivals drop by 18 percent in November and by 14 percent for the year.

“Many of the markets that we rely on the most like California, Arizona and Nevada are among those that have been hardest hit by the credit crisis and the declining home values,” Wallace said.

Hawaii’s most important international market, the Japan market, took a 20.3 percent nose-dive in November, bringing the year-to-date drop to 10 percent. Going forward, traffic from Japan to Hawaii is expected to be down by 8.9 percent during the New Year’s holiday, according to a forecast from Japan Airlines. The declines are due to an 11.4 percent drop in seats from last year and continued economic challenges, the company said.

Arrivals from Canada, traditionally Hawaii’s most faithful fall market, fell 7.1 percent in November. The market was up 5.9 percent for the year, but was not able to offset other shortfalls.

Cruise ship arrivals were down 21.9 percent for the month and 21.8 percent for the year as the market continued to grapple with the loss of two Hawaii home-ported NCL America ships and fewer stops from foreign-flagged ships, Wienert said.

Decreased cruise traffic was responsible for an estimated 50.2 percent of the decline in visitors felt by the Big Island, 45.9 percent of Kauai’s drop, 32.4 percent of Maui’s decline and 20.6 percent of Oahu’s fall, she said.

Hawaii’s neighbor island markets were hit hard last month by the drop in cruise traffic, seasonal island preferences, rising interisland airfares and reduced flight options.

“There has never been a time like this in Hawaii’s visitor industry,” said Ed Hubennette, Marriott International’s vice president of North Asia, Hawaii and the South Pacific.

It is impossible to pinpoint a market turnaround given the confluence of factors affecting Hawaii’s tourism industry, Wienert said.

“This isn’t a singular event so it’s going to take longer to recover,” she said. “We just have to be patient, but that’s hard when people are being laid off.”

http://www.starbulletin.com/news/20081220_isle_tourism_drop_nears_great_depression_levels.html

#71 Nomad on 12.21.08 at 11:39 am

Vancouver as a financial center? NY/London/Tokyo dying a slow death? This is Xmas, not April 1st right?

I grew up in and love Vancouver more than any other city in the world, and wouldn’t want to raise my family in any other city than here (and I’ve done my fair share of globe trotting).

With that being said, as a ‘naive’ <30 toddler who has been blessed with the good fortunes to work on the frontlines in finance (and still surviving) in Toronto/NY/London/HK, and now Tokyo, anyone that thinks Vancouver is in the same league – no, make that same planet – as any of the traditional financial centers needs to seriously get out more.

Sure Vancouver is stunningly beautiful in the summer, the air is clean, and I will forever hold a soft spot for it, but Tokyo on its worst day (recession or not) will still be 100x time more vibrant than Vancouver will ever be on its best day.

And no, despite the doom and gloom that is always posted about Japan on these forums, I personally live here and will attest that it’s overblown. Japan has been in a recession since the end of the 80s. People are used to it. People have massive savings here. Talk a walk around Ginza/Omotesando and tell me it’s something that Robson can even dream hold a candle to. There are still more Ferraris/Lambos/911s/Bentleys in the 1-mile radius around Roppongi Hills than there will ever be in all of Greater Vancouver. I have already saved more money in 5 years from work in NYC/LDN/TKY than I could hope to make in 25 years had I chosen to stay back home in BC.

I am of Asian descent and am proud to call Vancouver my home. But statements like “everything and everybody from Asia enters thru Vancouver” are so factually incorrect that it’s meant to be taken as a joke (and apologies if I didn’t catch it).

#72 dd on 12.21.08 at 11:43 am

#70 Makeorbreak,

Post is too long. Nobody has read this. Just attach short cut ….

#73 dd on 12.21.08 at 11:55 am

#4 Calgary_rip_off,

For coal to be king … the price of oil has to be north of $100 a barrel. Simple economics.

At $15 oil, the price of natural gas drops. If the price of NGas drops, government rev drops. Your hospital job … your wages will be cut 10 – 20%.

If you don’t give a damn about investing or what your money does when you are sleeping go buy a house today.

Again whether you know it or not you are an investor Rip – Off. You are waiting to buy a house at a reasonable price. That is the first principle of investing.

Ripp-off you are the number one investor on this website.

#74 smwhite on 12.21.08 at 12:00 pm

#10 real estate expert/ymaxxx

Give up on your fantasy “predictions” once and for all, pretty please. Vancouver is toast…

And oh yes, those that banked so highly on oil seem to forget that without GM and Chrysler’s incompetence, the oil $ would never have gotten out of hand…

Oil needs auto, no auto, no oil…

#75 re-aligned on 12.22.08 at 1:56 am

Which Asians is the RE expert talking about? The ones who lost billions in Hong Kong today/ Or the koreans? Nah, gotta be those who lost on the Nikkei. They’re so flush with cash, they can’t wait to jack up RE in the ‘Couv with their massive influx. What a jackass!!
http://www.salon.com/wires/ap/business/2008/12/21/D957INM00_world_markets/index.html

#76 Tin Foil Hat Man on 12.23.08 at 4:42 pm

Glad to see all of the “experts” have tuned in…
After years of telling me to go and get my tin foil hat on.

Even Stephen Harper was telling us during the election in Oct. ’08;

“The fundamentals of our economy are fine.”

and,

“There are some excellent opportunities on the stock market today.”

Get prepared?

I’ve been preparing for almost two years.

People talking about getting some cans of soup, and the like? Yeah, while you’re talking about it, someone else is DOING it.

As far as guns go?

It takes 3 months after you take your CFSC (Canadian Firearms & Safety Course) to be eligible to even purchase a firearm (PAL).

So, for the sake of argument, you took a course in the second week of January (earliest one, I checked) you wouldn’t be able to get a firearm until mid April. Many ‘experts’ now predict that the fit is going to hit the shan by February – after Christmas consumer spending, or lack thereof pulls the carpet out from under whats left of the ‘economy’.

To the some who angrily tell people that they’re stupid if they don’t want to buy real estate:

No, I don’t want to buy any of your four $1,000,000 Vancouver Specials which you drastically over paid for expecting to flip it for $1,200,000. It’s worth $250,000 AT BEST – depending on, you guessed it – location.

You know why the average price of a house in Detroit is $18,500 now? It is because noone wants to live there.
Sure, Vancouver is nice and pretty now…but should the inevitable occur and civil unrest rears it head, you’ll find you won’t be able to get a dollar for your so-called investment.
Go and tell that to the banks who got $75 billion from Harper, and the hundreds of billions more in loan guarantees… Yeah, a house in Detroit took over three weeks to sell in July ’08 – it’s asking price? $1 US.

I already bought my land thanks – a 12 acre treed parcel in the ‘interior’. I could have rented a basment suite in one of your Vancouver Specials for two years for what I paid for it – and I OWN it – first time I ever owned anything of substance in my life, and it feels damn good that my partner and I will be able to grow food, have fuel & water and not have to depend on a single solitary soul for another thing again.

Last summer I completed the second structure – a barn, to compliment the main house. I have fresh water 75′ away from the house, where one of the first things I did was establish a basic hydro-electric system. I even have hot water, thanks to coils and coils of copper piping under the floors of my house which also – you guessed it – heats the place. Solar power works excellent by the way. Some deep cycle batteries and a few solar panels, and you’re on your way.

Yeah, my tin foil hat is firmly in place – buried with my gold and silver…not too far from my secondary ammo cache and solar powered motion sensor and wireless camera.

This is not some Y2K scare. If you decide to stay in the city…or even close to it, your ‘security’ and well being is entirely out of your hands. You will be entirely dependent upon the government (all levels) for everything you need – and they will be so overwhelmed it’ll make your head spin.

Think Superstore will have stocked shelves of food for you during a crisis like whats coming? Food goes first – as it does in every country where whats coming here happens.

Research what happened in Argentina from 2000-2005 to see what I mean. One day, the govenrnment seized all citizen’s bank accounts (Same law exists here in Canada – which is why I maintain a zero balance) and the country went ballistic. Not only that, but we’ll have to contend with an imploding United States of Bankruptcy as well. Over 30 US States are facing bankruptcy in 2009. Not maybe, or substantial cuts to services – but bankruptcy.

Think Weimar Germany, and substitute skinny, war torn Germans speedily pushing wheelbarrows full of deutchsmarks for a loaf of bread before the currency deflates further before they get to the store for fat, ignorant, American Idol worshipping gun toting Americans and a bigger picture starts to arise.

Word to the wise:

Unless you’re waving a huge white flag over your head when crossing my land, I’m shooting first and asking questions later…and believe me, I’ll know the minute you step onto it.

Good luck.

You owe us a Google Earth map of thet location, pardner, so’s we don’t mosey by and get our asses shot off (in April). — Garth