2009. Look out below.

Listen to an interview with Garth - click banner above.

Fort Mac, 1400 square feet, $749,900. Owned by realtors, of course.

Fortune magazine has issued a list of real estate disaster areas in the USA for 2009. Astonishingly, eight of the ten Ground Zero locations are in California, where the median house price (at least in the heavily populated southern area) has already collapsed by 50% from the peak point. The forecast below, if accurate, shows just how much of a mess we all remain mired in, since a continued real estate-led recession/depression in the States just about guarantees more crap here.

  1. Los Angeles, CA. 2009 projected change: -24.9%
  2. Stockton, CA. 2009 projected change: -24.7%
  3. Riverside, CA. 2009 projected change: -23.3%
  4. Miami/Miami Beach, FL. 2009 projected change: -22.8%
  5. Sacramento, CA. 2009 projected change: -22.2%
  6. Santa Ana/Anaheim, CA. 2009 projected change: -22.0%
  7. Fresno, CA. 2009 projected change: -21.6%
  8. San Diego, CA. 2009 projected change: -21.1%
  9. Bakersfield, CA. 2009 projected change: -20.9%
  10. Washington, DC. 2009 projected change: -19.9%

Now, what about Canada? Well, we do not get off much more easily, so I will give a few of my thoughts on the house value declines that we should be expecting in this great, snow-challenged land, by Christmas Eve, 2009.

1. Fort Mac, KOA 2009 projected change: -47%

2. Kelowna, BC 2009 projected change: -38%

3. Canmore, KOA 2009 projected change: -27%

4. Vancouver, BC 2009 projected change: -21%

5. Windsor-Chatham, Ont 2009 projected change: -20%

6. Victoria, BC 2009 projected change: -18%

7. Edmonton, Kingdom of Alta 2009 projected change: -16%

8. Muskoka, Ont 2009 projected change: -16%

9. Calgary, KOA 2009 projected change: -15%

10. GTA, Ont 2009 projected change: -14%

Subject, of course, to change without notice or responsibility!


#1 Smart on 12.24.08 at 12:34 pm

Why is in GTA only 14%?

#2 Chaser on 12.24.08 at 12:51 pm

Last time I looked Fort Mac was also in Alberta…sorry according to you that is the Kingdom of Alberta (nice)

#3 Cashmoney on 12.24.08 at 12:55 pm


#4 Cashmoney on 12.24.08 at 12:57 pm

What criteria did you use in calculating the projected percentage loss in value in Canada?

#5 Larry on 12.24.08 at 12:58 pm

Only 15% for Calgary, i reckon it will be double that tbh given the quantity of shacks for sale here.
Either way the slide will not stop next dec 2009.
Thanks for the blog Garth and enjoy the christmas hols.

#6 The First Rick on 12.24.08 at 1:01 pm

Merry Christmas Garth.

#7 Jeff on 12.24.08 at 1:04 pm

Last time I checked Canmore was in the KOA. Are you implying that we don’t get to keep Canmore when we separate?

#8 colette on 12.24.08 at 1:05 pm

How about areas like the Kootnenays where they are employment challenged but prices have risen to outlandish ludicrous heights based on the Albertans flooding in for recreational homes.

Last year I couldn’t believe the prices. $300,000 for dumps in Cranbrook and when I asked what was the economic driving factor for the prices they said they were building a new golf course. And then further down the road Fernie!!!! $600,000 for old small homes built for the mine employees of yesteryear but now being snapped up by ski bums.

Condos that at first blush seemed reasonable $115,000 but then on second look the price was only for a 1/4 share.

But the real estate woman had read your book and advised us to just rent as prices would come down. We chose another area not so remote and with real estate much more reasonable.

#9 Helmut on 12.24.08 at 1:14 pm

Merry Christmas Dude…. :)

#10 Alberta Ed on 12.24.08 at 1:20 pm

Housing is seriously overpriced in Fort Mac (now experiencing a significant out-migration), Kelowna, Calgary and Canmore, four places I am somewhat familiar with. With the real crunch from the collapse of the heavy oilsands projects and related upgraders, your projection is conservative, IMHO. Prices would have to fall by 50% to reach realistic values in the above-named communities.

#11 brazer on 12.24.08 at 1:20 pm

2010 organizers put medal ceremonies on chopping block in budget cuts

VANCOUVER, B.C. – A proposal to scale back on 2010 Winter Olympic medal ceremonies is raising the ire of politicians in Whistler, B.C., who’ve already committed millions of dollars for nightly parties around the event.

The 2010 organizing committee, known as VANOC, has suggested scrapping the plan to award alpine and Nordic event medals at nightly celebration events in Whistler as part of an ongoing review into how they can shave costs off their $1.6-billion operating budget.


there will be more of this coming…

#12 Alberta Ed on 12.24.08 at 1:21 pm

Housing is seriously overpriced in Fort Mac (now experiencing a significant out-migration), Kelowna, Calgary and Canmore, four places I am somewhat familiar with. With the real crunch from the collapse of the heavy oilsands projects and related upgraders yet to be felt, your projection is conservative, IMHO. Prices would have to fall by 50% to reach realistic values in the above-named communities.

#13 Carla on 12.24.08 at 1:21 pm

I don’t see anything on your Canadian list that brings prices into the realm of affordability. And how come you never talk about Saskatoon? I thought it was hot.

Merry Christmas Garth. Thanks for all the good reading.

#14 nonplused on 12.24.08 at 1:24 pm

“Kingdom of Alberta”? This coming from someone living in “Center of the Universe Ontario”?

KOA and CUO! I love it!

Are these forecasts in addition to the 10% calculated for 2008?

I think they are a little light. 2009 is going to be the year when we have to admit the whole thing was just a big delusion.

These are some of the things we have to face up to in 2009 and it’s all going to come at once in one big Minksy moment:


– The tech bubble was a delusion. Tech stocks never were nor never will be worth 100 time hypothetical earnings.
– The stock bubble was a delusion. Stocks are not worth 30 times earnings. Ever. Too much risk.
– The housing bubble was a delusion. House prices are affordable at 3-4 times family income. They are depreciating consumer items not appreciating assets.
– The credit bubble was a delusion. You cannot create wealth by repackaging debt.
– All of the Trillions we think we are loosing now never really existed. It was just bad reckoning that led us to believe we were all rich because a few stocks and houses traded at unrealistic prices. And only a new delusion can bring the delusion back.
And still to come:
– The social security system is a ponzi scheme, and it will not be funded because there aren’t enough people to fund it. There is no other way to fund it either. Baby Boomers are not going to receive the benefits they thought they were. And there simply isn’t anything we can do about it due to demographics.
– Our industrial base is hollowed out and it isn’t coming back. China ate our lunch.
– The government’s (all levels) revenue streams are about to collapse.
– The treasury market (all major governments) is a ponzi scheme. There is no money to pay back the government debt if China and the Middle East stop buying new debt.
A big one which I think many people are already starting to realize:
– The people in charge may mean well, but they don’t really know what they are doing. Nobody can really understand the economy. It’s more complex than they human mind can grasp. Governments simply won’t be able to help and in all likelihood are going to make mattes worse.
And once the last one hits home, the $hit hits the fan (literally):
– The US dollar (and all other currencies through the Breton Woods system) are worthless.

All this has to be reckoned with and probably in 2009. I think it’s time to stop talking about bandaid bailouts and housing bottoms and seriously consider that it’s time for individuals to prepare for the worst. I don’t believe at this point there is anything that can be done.

#15 real estate expert on 12.24.08 at 1:26 pm

Happy holidays to all

…even to Deke the geek


Real estate expert, from the city of vancouver, the city of paradise, the next financial/trade capital of North America and where the men are men and the sheep are nervous.

#16 brazer on 12.24.08 at 1:28 pm


this is the best video about the economy i’ve seen yet…definitely worth a couple of minutes of everyone’s time to view.

carrots will never taste the same again…

#17 Wondering on 12.24.08 at 1:31 pm

So does that mean if I can buy a house now (in the GTA) for 15% the listing price, which was already reduced 5%, it will be a good deal?
This will put the house around the same price as what the current owners bought it for in 2002.

I’d have a decent down payment, btw (around 25 to 30%).


And Merry Christmas Garth (or Happy Holidays, whichever you prefer).

#18 Wondering on 12.24.08 at 1:34 pm

edit to # 16 above.

That should read 15% OFF the listing price, not for 15 % OF the listing price.

If it was for 15 % OF the listing price, then even I wouldn’t have to ask if that was a good deal :P

#19 Jon B on 12.24.08 at 1:41 pm

I thought you meant Alberta is destined to become one large KOA campground.

#20 nonplused on 12.24.08 at 1:44 pm



#21 Gigglefinder on 12.24.08 at 2:01 pm

Garth – you should cease with your KOA childishness. And Alberta is now abbreviated AB not Alta. Just like Nfld/ NF is now NL. You’re just another talking head. Do you have a MBA? Just curious.

No, just LCBO. — Garth

#22 Fort Mac girl on 12.24.08 at 2:06 pm

I bought my place in Feb. 2007, so I am in for a big trouble!


#23 brazer on 12.24.08 at 2:09 pm

Canadian economy shrinks

Construction, a source of strength earlier in the year, has recently begun to track the slide in house prices and sales.

Construction slowed by 0.3 per cent in October with home building falling 1.2 per cent.

“The drop (in house construction) was widespread as none of the major markets were spared from the downturn,” Statistics Canada reported.

As a result, the real estate agents and brokers industry fell 14.3 per cent over the month, the largest monthly decline in over a decade.


shhhhhh….don’t tell maureen.

#24 $fromA$ia on 12.24.08 at 2:13 pm

Vancouver should be minus 35%!!!

#25 Keith in Calgary on 12.24.08 at 2:31 pm

Calgary will go down 25% in 2009…..me thinks you are being to cautious in your 15% prediction Garth.

We went down 15% from the high in June 2007 to today.

Low oil prices the ramifications thereof, plus the economic collapse brought about by the financial system are the triggers…….that, and oh yeah, 12,000 listings and 800 buyers…….

#26 jacques on 12.24.08 at 2:31 pm

Hi Garth,

following your analysis with interest. Just sold my condo in Québec City where prices were in fact *up* 7% year-over-year from summer ’07 to summer ’08. Do you see real estate correction coming to markets east of the Ottawa River in ’09? best wishes for the holidays.

Dépaysé in Toronto

Attendez! — Garth

#27 JO on 12.24.08 at 2:39 pm

I like your crystal ball Garth. Lets hope these declines will not be much worse in 2009. I am living at home still and saving agressively to buy a place in late 2010/2011. If my significant other wasn’t so brainwashed into buying RE only, I would not buy until 2012-2013. I think it is possible to have a respite in Q1-Q3 09 in the economy due to these bailout/stimulus nonsense being done, but the only question is how much RE goes down. In my opinion, 2010 and 2011 will be the worse years for RE as unemployment and GDP lapse back into their long term trends after the fiscal and monetary measures end.

Anyway, just want to say happy holidays and thanks for the info as well as your commentary. Keep up the good posts and best wishes for a wonderful holiday season and new year.


#28 Wisdom on 12.24.08 at 2:40 pm

@Garth, I’m looking to buy your “The Little Book Of Small Business Wisdom”, but can’t find it on Amazon or Chapters. Any suggestions on where to buy it?

#29 Jeannie on 12.24.08 at 3:06 pm

nonplussed, you are one of the few posters who seem to have a handle on what’s happening.
Are you ‘nonplussed’ because you have a way out of this mess? Care to share?
What’s your take on gold? the Canuck buck..are you shifting it into Eurodollars?

Enjoy your intelligent posts.

#30 Downsized and Delighted on 12.24.08 at 3:08 pm

When I look at those numbers Garth, it makes me think waay back to how my teachers graded papers – after two or three martinis. But they had to finish marking – you could have just gone to bed! Merry Xmas.

#31 Don Bool on 12.24.08 at 3:33 pm

All the best for the holidays, and a happy new year to your lovely wife,your new dog, and your new jeep to pack your treasures to your cabin. The same to your bike.

#32 kitchener1 on 12.24.08 at 3:45 pm


I think that Garth’s predictions are all very viable. Remeber he is making general predictions for the areas as a whole. ie. Within the GTA I see areas that are dependanent one auto manufactoring will suffer more then the area as a whole. Brampton, Oshawa, Ajax, Whitby will see far greater drops then 14%. Condo’s will fall by at least 30%.

However, as a whole 14%-20% seems about right as that is what will be reflected in the CREA numbers.

#33 East of GTA on 12.24.08 at 3:52 pm

What about Montreal? Is it unique enough to escape the things to come?

#34 real estate expert on 12.24.08 at 4:00 pm

REE is humble… he called the Olympic scaling back possibility…I definately did….instead spend the scaled back monies on other infrastructure.

…and Uncle Garth does not call a larger drop for the GTA cause he doesn’t want to scare the heebie jeebies out of Ontarians.

But why only a five % greater drop for Vancouver?

…Me thinks U G is begining to see the light that Vancouver is Canada’s savior city for the future.

Did I ever mention Vancouver will become the next Financial/Trade capital for North America?

Merry Xmas to all and to all a good night

#35 Jeff on 12.24.08 at 4:02 pm

Garth… tell us what you really think. These numbers seem timid.

#36 POL-CAN on 12.24.08 at 4:04 pm

#14 nonplused

excellent post!

The collapse is on its way…. Is every one here ready?

#37 Gord In Vancouver on 12.24.08 at 4:07 pm

Happy Holidays, Garth !!!

Vancouver realtors just breathed a sigh of relief that you didn’t give their city the #1 spot.

“real estate expert” must be a fictional character that someone developed to give this board some balance. It’s interesting how NO ONE can post any compelling objective evidence that states why Canadian real estate should be purchased now.

#38 Tony Soprano on 12.24.08 at 4:31 pm

“Garth, I’m looking to buy your “The Little Book Of Small Business Wisdom”, but can’t find it on Amazon or Chapters. Any suggestions on where to buy it?”

I picked it up at amazon.ca, just last month. Check again.

#39 Mike in Etown on 12.24.08 at 5:05 pm

I always thought we were a republic in Alberta… agreed on the Kootenays; I am spending my holidays here (there?) and wonder if I am speaking a different language from these people.

#40 Sandy in Calgary on 12.24.08 at 5:13 pm

I read Greater Fool in February, sold my house in June, am house sitting until January and gratefully saved so much money I am going to visit my daughter in Australia until March.

Hey if that isn’t worth the price of a book what is? I was bucking the trend, but thankfully just felt the timing worked for me at the time. Read the book passed it on to friends. All 3 said, thanks, we appreciate the heads up, but it probably won’t happen in Alberta.

Have a wonderful holiday my friend. As I think I mentioned before, 2009 belongs to the coachable.

Merry Christmas, everyone. I think the mere fact that we are all trying to be more aware is worth gold. I really value everyone’s comments. Helps me to put my own ducks in a row.

#41 The First Rick on 12.24.08 at 5:24 pm

#22 Fort Mac girl on 12.24.08 at 2:06 pm I bought my place in Feb. 2007, so I am in for a big trouble!

Hey, I know a couple of folks in the Mac who could rent rooms from you? Oh, wait, they just got their lay off notices.
Er, yeah, you are in trouble. :(

#42 Nicholas P on 12.24.08 at 5:34 pm

Merry X-mas mate!

All the best to you and yours in the New Year.

Thanks from Saint John N.B.

#43 Darrylscrooge on 12.24.08 at 5:54 pm

A little off topic for this post but heard a phrase today that seems to go with the present situation. ” you can control a society through two things only, fear and hope.”

Seems to be little hope these days. Will this change the way governments rule?

Merry Christmas everyone.

#44 Dawn in Calgary on 12.24.08 at 5:56 pm

Garth, I agree, those numbers seem timid, coming from you. Are you hedging your bets?

When we first moved here, I was a bit jealous because I wasn’t in O/G, raking in the five and six figure bonuses that everyone else and their sister were. Now, I’m glad my industry is nowhere near O/G nor dependant on it. We make software that helps large companies downsize. :-)

Merry Christmas and Happy New Year to everyone.

#45 truerickroll on 12.24.08 at 6:46 pm

dawm sounds like your business will be booming soon

#46 rana on 12.24.08 at 7:03 pm

Thanks Garth & happy holiday.

#47 dekethegeek on 12.24.08 at 7:11 pm

#15 Real Estate Expert;
Sorry buddy I was shoveling snow in vancouver !
Merry Christmas to you too !
Keep up the comments. They always make me smile. Even if I dont agree, they’re still hilarious.

Garth, and all you other “geeks” out there. Have a relaxing few days off and Merry Festivus( for all you politically correct bunion-heads)

#48 Homeless in Vancouver on 12.24.08 at 7:50 pm


I hear some say that inflation will hit hard after a short period of deflation. This inflation will be driven by all the excess money in the system from the aggressive measures taken by the central banks and governments once liquidity does free up. (Perhaps inflation is the solution).

Isn’t getting a reasonable size mortgage and owning some real property a nice hedge against inflation? If so how long do you wait for price declines before making a purchase.

Merry Christmas

If you think this deflation is an interesting intermission, think again. It’s the main course. — Garth

#49 POL-CAN on 12.24.08 at 7:50 pm

Garth… Not sure if you have seen this yet….

Mish does it again :)


In Spain, Ford is dumping cars at 25% off.

Ford Spain has announced that from Monday it is offering a 25% discount on 6,000 of the estimated 25,000 cars it has in stock.

All models will be available at the discount until January 24, with the exception of the new designs of the Ka, Fiesta and Kuga.

President of Ford Spain, José Manuel Machado, said that the measure responded to the ‘very delicate situation for the dealers’, and the company could not be accused of dumping as it was a single and limited action.

New Ceiling is 25% Off

The new ceiling to sell a Ford in Spain is 25% off, direct from the manufacturer. Dealers are not exactly happy to say the least.

Ford denies it is dumping on grounds the offer has an end date of January 24, 2009. I expect to see 25% off (or more) in the US as well. All you have to do is wait.

Why buy now when it will be cheaper tomorrow?

Just imagine what this will do to the used car market once all the parties start slashing their prices on new vehicles to clear inventory….

#50 Blacksheep on 12.24.08 at 8:03 pm

Merry x-mas to all.

take care

#51 poorguy on 12.24.08 at 8:26 pm


Soooo Funny :)

#52 MissedTheBoat on 12.24.08 at 8:58 pm

To Garth and all the other contributors here:

Merry Christmas and a fabulous New Year.

#53 JET on 12.24.08 at 9:08 pm

Merry Christmas and Happy New Year to All!

Garth, any chance commentators to your blog could get a signed copy of your new book? (Perhaps not free but signed – what a great way it would be for your fans to help promote your book!)


Consider it done. — Garth

#54 squidly77 on 12.24.08 at 9:10 pm

for all those that think that the fed printing a couple trillion dollar notes will cause inflation
this might make you see why it wont

The chart shows a massive reduction in net worth of households over the last 4 quarters.

2007 Q4 -$1.46 Trillion
2008 Q1 -$2.42 Trillion
2008 Q2 -$0.39 Trillion
2008 Q3 -$2.81 Trillion


and thats just household wealth..

#55 Howard Holt's shark on 12.24.08 at 9:42 pm


Thx for that post. So far in the media no mention of what’s happening with the big 3 bails (?) in Europe, AU/NZ.

Me thinks GTA condo market in for more than the -14% houser.

#56 Investx on 12.24.08 at 9:55 pm

The price predictions for places like the GTA (-15%) doesn’t seem so bad, at least not as bad as the impression I got from Garth’s doom-and-gloom talk. What happened?

Well, 15% in one year has not happened before. Did you expect locusts? — Garth

#57 Kanata middle class on 12.24.08 at 10:08 pm

Best wishes for the holidays and in the new year!

So glad I moved from Vancouver … thanks Garth for the heads up last year!

#58 eh on 12.24.08 at 10:18 pm

Merry Christmas everyone!

Thanks to all for blogging in the last year and thanks to Garth for his website and postings.

All the best to you all in 2009!

(Man, it’s hard to wrap a squirrel!)

#59 $fromA$ia on 12.24.08 at 10:24 pm

Garth, you think it would be better to opt out of purchasing a fire arm for tough times and start a Gerbal farm?

#60 JET on 12.24.08 at 10:35 pm

Consider it done. — Garth
Thanks Garth! The next question is how…

#61 Jane on 12.24.08 at 11:12 pm

Thank you for your book Greater Fool. I bought it several months ago and it confirmed my sense that real estate was peaking. My son bought a condo in August with 5% down and I was able to convince him – with your help – that he should try to sell the condo asap. Miraculously he was able to sell and he will be immeasurably better off in 2009 thanks to you.
We are grateful.
Best wishes for the new year.

#62 Wealthy Renter on 12.24.08 at 11:21 pm

“Garth, any chance commentators to your blog could get a signed copy of your new book? (Perhaps not free but signed ”

Ha Jet,

You beat me to it, but don’t if you read the post about bargaining for a house, you gave away your position way too quickly – at least go for the heavily discounted, signed book! :)

Three bromides I live by:
“If its cheap, I will not weep.”
“If I don’t pay, it makes my day.”
“If its free, it is for me! ”

Seriously, happy holidays all.

Mr. Turner, thanks for the blog. It is the only one I visit, and it is the best one stop shopping for news/commentary/links related to real estate in Canada, as well economic related issues.

I am looking forward to the new book.

Well, off to bed, or Santa won’t come.

#63 Fort Mac Girl on 12.25.08 at 12:12 am

#41 The First Rick

You are so mean.

Mine’s only a trailer but I paid $375K and I still owe 300K to the bank. That’s considered affordable housing here.
I still have contract with one of the oil companies for the next 2 years so I won’t have a problem paying off my mortgage.
However, I don’t want to keep paying my mortgage when this place is worth $175.
If I could sell my place and rent, it’s going to be no less than $2500 a month for a one-bedroom apartment.


Merry Christmas to you all and have a very Happy New Year:)))

I don’t drink so I’ll be saving some bucks.


#64 homeless and happy on 12.25.08 at 12:46 am

When times are tough you just have got to roll with it and look for new business opportunities to present themselves.

Right now I think it’s the perfect time to start a North American wide chain of crack houses. Start small in Detroit and expand slowly towards Cleveland. Something like this would take off like wildfire!

#65 bcgirl on 12.25.08 at 1:04 am

Merry Christmas everybody.

Thanks Garth for a great blog. I’m looking forward to the book.

Best in 2009 fellow “vultures”!

#66 sourgrapes on 12.25.08 at 1:53 am

I’m SOOOO disappointed, Garth. You said: “Victoria, BC 2009 projected change: -18%.”

Please change that to 50%. I can’t afford anything unless it’s discounted half-price. Wave your magic wand. Come ON!

#67 nonplused on 12.25.08 at 2:41 am

#29 Jeannie,

Thanks for the kind words, even though I don’t feel it’s really true. I’m as panicked as anybody. Probably moreso.

I will use this analogy:

I coach a girl’s under 14 soccer team right now (indoor and outdoor, recently impaired by the collapse of the bubble in South East Calgary).

What I can readily tell as a coach (and so can most parents) is why we are loosing. It seems obvious at the time and on the tape.

I think I am better than some coaches at suggesting to the players how to win, because I have extensive play experience myself. People who have played for a long time no how to win, and they don’t have to be told by the coach why they lost.

The problem is loosing can be done by just a few players in a single game. Winning is a dedicated process involving the whole team executing a collaborative strategy over a whole season. You can’t win the game for the team by yourself. Even Wayne Gretsky knows this.

How to win this current situation? I’ve never seen this game before. I don’t know. My strategy would be to follow the rules that have served all players well through time, all the way back to WWII (My grandparents being the oldest input I have).

– Pay off debt. Better yet don’t acquire it.
– Don’t buy things you don’t need
– Don’t buy things you can’t afford
– If you do have more money than your neighbors and relatives, make sure they can’t see it. Live like they do. Even if they know you are more wealthy than they, they will feel better if you both drive the same car and live on the same street. They really only react to what they see. Don’t ever be the point of jealousy. Be modest.
– Be resourceful. Learn to do things yourself.
– Be resourceful. Acquire the means to do things yourself.
– If something you are going to need anyway is on sale, buy it and put it on a shelf.
– If something you are going to need anyway is not on sale, don’t buy it until you need it.
– Understand that when the government looses control of a situation, you are on your own. (Think Katrina. Or WWII.)
– The best of business partners when time are good will screw you like you are a Mexican prostitute when things go south. Hire a lawyer now even if you couldn’t possibly imagine needing one later. In the new world of divorce as a means of self fulfillment this even applies to marriage. If you have any assets, hire a lawyer before making any deals of any kind.

I am sure there are a lot of other “rules of the game” that other readers can post, but that’s all I have for today.

#68 Observer on 12.25.08 at 2:45 am

“Well, 15% in one year has not happened before. Did you expect locusts? — Garth”

This is true. But we saw increases just before the peak like we have never seen before. Considering the only thing that kept the economy going in Vancouver has been construction I am predicting locusts. And I’m a usually a positive person. There’s a lot of pain coming.

#69 nonplused on 12.25.08 at 2:50 am

#29 again,

the definition of the word


I chose it as a name because I am completely confused by the complexity of the situation.

#70 nonplused on 12.25.08 at 2:56 am

#29 again again,

I have some gold, which has always preserved wealth through times of paper money collapse. But now we rely heavily on electronic transactions. And I think the benefits of sticking the card in the gas pump are worth preserving. Unfortunately we are in uncharted territory, as gold has never been incorporated in this new and wonderful electronic system.

#71 nonplused on 12.25.08 at 3:02 am

Garth I’ll take a signed copy of the book, let me know how.

#72 David on 12.25.08 at 6:33 am

That rather modest looking $750K Fort Mac home would cost a family in the neighbourhood of $5K in after tax dollars per month. Considering that the town is on the highway to nowhere and a complete economic monoculture, the price of excess will prove to be very high. If the price of oil starts trading in the $25-$30 range, one can rest assured that there will be a significant slowdown in both production and projects will be frozen indefinitely. The 47% decline prediction might look optimistic in a few years. Single industry communities in Canada do not have a happy history when falling commodity prices shred the local economy and homes and commercial property are rendered worthless.

#73 Future Expatriate on 12.25.08 at 6:40 am

Sounds like forecasts of listing price drops… not SALES at those price drops.

The price drops of properties WHICH ACTUALLY SELL will be far greater.

#74 David on 12.25.08 at 9:53 am

The price decline predictions for Canada are realistic and probably understate the case on potential price declines. Orange County used to be one of the wealthiest zip codes in the USA and the bastion of high priced real estate. The weighted average year over year decline for all residential properties in OC this year is 30.4%. If fortress real estate in Southern California is falling off the cliff, it is reasonable to assume similar outcomes here.

#75 From the Shwa on 12.25.08 at 10:25 am

Any estimates as to housing prices in Oshawa? First time buy here looking, but holding off til 2009 possibly 2010

#76 Brent on 12.25.08 at 10:54 am

Edmonton SFH prices dropping 16% in 2009 seems a little conservative.
Edmonton SFH prices have dropped 8% in the first two weeks of December.

#77 patriotz on 12.25.08 at 11:06 am

Oshawa? Isn’t that where the big GM plant is?

#78 Darryl on 12.25.08 at 11:23 am

Fort Mac RE is more expensive for several reasons.
..The transport costs of building materials
.The new infastructure that has to be installed (water ,sewere,hydro,Tim Hortons)
.The limited construction window because of weather and day light.
.Limited labor.
Real estate may go down to less speculative levels but oil will be back up in price within a couple of years.
The limited supply of homes and infastructre will cause RE values to rise again. Big cities with a glut of house may have a different future.

Did I mention that Milton Ontario will become the hub of finance and commerce for the world:)

#79 OntarioHouse on 12.25.08 at 12:02 pm

I listened to your interview Garth. It was good.

#80 squidly77 on 12.25.08 at 12:18 pm

Fort Mac RE is more expensive for several reasons.
..The transport costs of building materials
.The new infastructure that has to be installed (water ,sewere,hydro,Tim Hortons)
.The limited construction window because of weather and day light.
.Limited labor.

what a bunch of hog wash
lumber is produced in town
cement is produced in town
45 min less daylight (winter) then edm in winter
4 hours more daylight (summer) than edm
contrary to popular belief there is an abundance of labour in ft mac..
the main reason for high prices in ft mac is greed
and the gambling specs do not realize that syncrude and suncor are there rival bidders
they have slightly deeper pockets and they will all sell at peak prices and leave the specs holding the bag

they own so much ft mac property and so many businesses up there that they create there own micro industry going from boom to bust virtually at will

#81 Jeannie on 12.25.08 at 12:21 pm

Nonplused…your coach analogy was quite apt.

Found myself ticking off most of your suggestions, particularly on keeping a low profile, (the tall poppy syndrome) seems I’m on the right track!

Yes, we’re in uncharted territory, where even commonsense is uncommon nowadays… great wake-up lessons ahead for those who need it.

By the way, when is YOUR book coming out!

#82 Jeannie on 12.25.08 at 12:38 pm

We met a married real estate couple from Fort Mac at a house party last night.
They assured us that business was still booming, and that the foreseeable future for the area was all roses…”the world will always need oil” etc.,

They seemed very prosperous, although they admitted that actually having to live in Fort Mac was a high price to pay for their financial success.
It remains to be seen whether or not the outrageous real estate prices in FM. can be sustained.

An interesting conversation.

#83 marcus aurelius on 12.25.08 at 1:38 pm


#1 – It’s plausible to foresee only 15% average drops in the GTA (be careful about listing prices – which, in Toronto, can be truely bizarre and the result of Iranian after-dinner poppylust). That is because the microanalysis of neighbourhoods can lead to significant swings in sale price results. For example, you can own a condo, but one in Yorkville or Summerhill, and get hurt far less than having bought a foreign-builder’s ‘special’ in Scarborough or North York (by that, I mean Korean/Iran/HongKong/Moscow-ville, around Bathurst or Bayview at Finch or Steeles), even though all condos, including DOA projects in Mississauga, might get hit by 50% or more. In short – those who don’t know their Toronto Real Estate micro-history are doomed to repeat their pain. I would not have wanted to buy any new construction detached houses south of Steeles over the last 4 years. Those folks had better have paid all-cash or reduced their mortgages significantly. The tsunami of lay-offs (including the white collar service sectors so key to Toronto Real Estate market-making by the dwindling agent-thief class) is going to roll through 2009 and into 2010.

Ever meet those ‘dual-income professional middle-manager 20-foot frontage but paid $1.3Million’ types? Dead Men Walking, once the management layoffs hit.

#84 Darryl on 12.25.08 at 1:41 pm


Lumber and concrete are not the expensive part of building a home. labour, Copper , windows, flooring , insulation and fixtures are.

Anyways my point was that they have a better chance of coming out of this downturn sooner because they have an industry that will thrive in the future. The reasons for the sky high prices will still exist when oil goes back to $80 plus.I’m from the golden horseshoe and the future does not look good at the moment. Time to change those auto plants into solar panel plants of some other future industry.

#85 wealthy renter2 on 12.25.08 at 1:41 pm

I’m curious to know what home prices were in Fort Mcmurray in the early nineties?
Anyone have any graphs or links?

#86 real estate expert on 12.25.08 at 1:47 pm

…China slowly killed “world competitiveness” over the last two or three decades.

Contemporary economies had no chance competing with a combination of 10% labour costs and a depreciated currency.

When you realize this you will appreciate that bankrupting China is the only way to recovery.

China is very close to begin manufacturing autos and planes…obviously on the cheap.

Will the U.S. will at some point “nationalize” it’s $1.5 trillion debt to China?

Will China and Russia go to war over Siberia and all its natural resources?…China has been settling Siberia for over a decade now…they have historical claims on Siberia.

…Is War imminent in the Middle East?…Is Israel on the brink?

Canadians should consider themselves most fortunate today, count our blessings…we live in the safest G7 country.

…What other country can you go on a blog site and b*tch and complain about how rich you are, were or will be?

People in too many parts of the world do not know where their next meal is coming from.

…I am a lucky soul.

btw, did I ever mention that Vancouver will become the next financial/trade centre for North America?

#87 midas on 12.25.08 at 1:52 pm

#33 – EAST OF GTA: What about Montreal? Is it unique enough to escape the things to come?

NO, NON Mon Ami! Montreal is already down 10% at least and I know this first hand. My sister-in-law bought a house on ILE BRIZZARD, a trendy burb for about 650K 3 years ago and this house was supposedly worth 800K last year. But if you check listings on MLS on Ile Brizzard around the Ran Rafael and Royal Montreal golf courses, a house very similar to hers with a pool, hardwood, granite, finished basement and all can be had for under 550K. Montreal will crash much like GTA, possibly even more.

#88 patriotz on 12.25.08 at 2:07 pm

btw, did I ever mention that Vancouver will become the next financial/trade centre for North America?

Yeah right. Vancouver has actually lost a great deal of financial activity in the last few decades, including the Bank of BC and the Vancouver Stock Exchange, and numerous resource industry head offices.

That’s why downtown Vancouver is being taken over by condos – there are no head offices to build for.

#89 midas on 12.25.08 at 3:00 pm

2009 BUZZ WORDS will not include Deflation, Inflation, Recession, or even depression but more likely WAR, CONFLICT, TERROR, FOOD SHORTAGES, RATIONING and those may just be the pleasant ones.

India gives Pakistan a Dec. 26 deadline – keep your eye on this rather than Boxing Day sales. This date will probably pass but this conflict will rage in the near future and may well be of the mushroom cloud variety.

U.S. debt approaches insolvency

A crash of the US dollar is very probable, even imminent in the short term; this will set off a domino effect that will make all paper fiat currencies pretty much worthless outside the borders of the issuing country. This in turn would halt most imports or make them outrageously expensive in local currency. Canada being a major importer of foodstuffs may see a dramatic increase or inflation in the price of essential imported goods even if price of non- essentials such as Jeeps and plasma TVs are deflating rapidly. So in this unprecedented crisis the problem will not be deflation across the board or inflation across the board but rather deflation in non-essentials and hyper-inflation in essentials. Even though Jeeps may be rapidly declining in price, the cost of foods will be so high that no one will have any money to buy such goods. In the words of The Mogambo Guru ‘We are so screwed!’

#90 Sandy in Calgary on 12.25.08 at 4:20 pm

What about investing in Calgary office buildings? What will the value of commercial real estate be in 1, 2 or 3 years from now?

#91 Nick on 12.25.08 at 4:38 pm

Merry Christmas Garth! The 20 bucks I spent on Greater Fool was the best investment I’ve ever made, I figure you’ve saved me over $100,000 in lost equity and increased mortgage payments. Your book was a breath of fresh air amidst the real estate industry cheerleaders telling me to buy before I was priced out forever.

#92 Strataman on 12.25.08 at 4:41 pm

Garth; New definition. Real estate Bull = -30 % Real estate bear = > 30 %. Why are you a bull? :-)

#93 eddy on 12.25.08 at 5:57 pm

Merry Christmas Garth and bloggers, thanks for the space to rant, my prediction for toronto is about 30% from peak. i like using east york bungalows as examples (because EY is a wartime (WWII) subdivision and they all look the same)- peak around 420, should end up around 300. better neighborhoods are harder to call, maybe less than 30%. i don’t predict a melt down because of the supply and demand factor. even mayor miller, try as he might, cant seem to kill it dead. i think he might repeal his land transfer tax, under pressure, and just raise all property tax, with verbiage like “I tried my best to buffer the majority of Torontonians from tax increases but they stopped buying houses in the numbers my experts had projected. so now we have to share the pain. we all have to dig a little deeper for a better city, Torontonians will not stand for a cut in services!”

#94 Cora on 12.25.08 at 6:37 pm

Merry Christmas. I was linked to this site unfortunately too late from the Globe and Mail on-line comment page. Thinking those other more popular misleading websites I “researched” and various agent were giving me good info, and being encouraged by family, I am now the owner of a 3 bedroom 2 bath 1250 sq foot condo townhouse in RH, condo fees less $100 monthly. I bought this Oct 2008 for 308,000 (asking price 321,000). It was built new in 2002 for 200,000. What should I have paid for it? I’m renting it out and should be paid off in 6-8 yrs at worst and original plan to keep 10+ years as a rental as a source of extra income. I currently live 10 minutes away in a paid off condo apt which I plan to keep.

Having discovered this website 30 days too late I realize that 25% downpayment I had in cash would have been better to keep. At least it’s small, might be appealing to a baby boomer down the road. How much damage did I do to myself? I can take it, I’m well numbed by “good cheer” at the moment.

Good luck to you all in the New Year of Impending Doom of 2009.

#95 Derrin on 12.25.08 at 8:07 pm


Fort Mac and cost of building.

It is called supply and demand – Econ 101.
When everybody wants lumber the price goes up.
When everybody wants cement at the same time the price goes up.
So, Daryll you are right the cost to build in Fort Mac is much higher.


#96 Derrin on 12.25.08 at 8:33 pm

Garth have we seen the “Whale” yet?

Lehman brothers and Madoff.
Or is the big one still on the bottom just waiting for the negative tide to inch a little further out.

Last time it was Enron(100 Billion) and previous to that it was LTCM.

I think you have found the “Whale” and it is real estate.

Wait for those markets to contract in 2009 and then watch the banks and or finance companies that have been using cheap money from the banks and investors try to swim to shore. They will be stuck in the muck. Western Canada better hope oil prices climb up to the $80 dollars a barrel soon or Canada will be in a heap of trouble.

#97 Peter Piper on 12.25.08 at 9:26 pm

#78 Darryl

Land shortages coupled with the high cost of materials and labor definitely make it more expensive to build a home in FM. But speculation has played a major role in the price appreciation we have seen over the past several years. Like many other markets in Canada, prices really started to take off upon the advent of the 40 year amortization mortgage.

The average price of a detached home in FM was 490K in January 2007 and end up at 632K in December 2007.

Could this really be only attributable to the increased cost of labor and materials?

#80 squidly77

There has been almost $70 Billion worth of spending on oil sands construction over the past 4 years. Inflation in the cost of building materials is real. But as stated before I suspect a large portion of the appreciation in housing prices in FM has been due to speculation.

However I have to completely disagree with your statement that “it is absolutely false to say there is an abundance of labor in the residential construction sector in FM”.

Where did you get that idea? The market for residential construction labor has been extremely tight for the past number of years.

I also have to completely disagree with your assertion that “gambling specs do not realize that syncrude and suncor are there rival bidders they have slightly deeper pockets and they will all sell at peak prices and leave the specs holding the bag” .

That is borderline paranoia.

#82 Jeannie

Never expect unbiased real estate advice from a “real estate couple”. Even if the sky were falling all around them, they would never admit it. FM is definitely in much better shape then most larger cities in Ontario at the moment, but things have slowed dramatically over the past couple of months. I don’t know if a 50% drop in home prices is in order, but I would not be surprised to see a significant decline in 2009. But try to get a local real estate agent to admit that possibility. Well good luck.

#85 wealthy renter2

Average price of a detached home in FM (sorry I don’t have median numbers).

December 1995 104K
December 1998 174K
December 2001 219K
December 2003 270K
December 2005 415K
December 2006 459K
December 2007 588K
November 2008 679K

#98 dd on 12.25.08 at 10:05 pm

#5 Larry,

10% 2008
15% 2009
10% 2010

#99 Peter Piper on 12.25.08 at 10:40 pm

Correction of squidly77’s quotation

#80 squidly77

There has been almost $70 Billion worth of spending on oil sands construction over the past 4 years. Inflation in the cost of building materials is real. But as stated before I suspect a large portion of the appreciation in housing prices in FM has been due to speculation.

However I have to completely disagree with your statement that “contrary to popular belief there is an abundance of labour in ft mac..”

Where did you get that idea?

The market for residential construction labor has been extremely tight for the past number of years.

#100 Shaun on 12.25.08 at 11:37 pm

We just sold a house in Southwest Edmonton for 18 percent below what was thought to be a very competitive asking price in June. After five months with no sales in the area for guidance, lots of toil and expense for improvements and through several price reductions we finally discovered the market value. That’s a decline of about 26 percent from the peak. Merry Christmas to all.

#101 nonplused on 12.26.08 at 1:02 am

#82 Jeannie

You flatter so well I can’t help but respond but I blush….

I don’t have a book in the works. To write a finance book (which is really a psychology book in a lot of ways) you need to research, come up with theories, spend a lot of time developing your message, communicate clearly, get feedback, revise, find a publisher, and take personal risk. As well as having a huge sense of self confidence that you are right and everybody else is wrong. I have none of these attributes and thus prefer to post the odd response to a blog.

When I was a kid my dad used to shut me up when I was getting a little too smart for my own good by asking me “if you are so smart, how come you aren’t rich?” He doesn’t say that anymore, probably because I’m a dumb adult now rather than a dumb kid, but maybe also because I made a good salary for a while. But I respect him for giving me the summer job I needed while in school and bailing me out a few times when I ran out of money. And he did that on a carpenter’s wage in bad times for carpenters. And it turns out he’s a pretty smart man too, but he didn’t have the same opportunities the times and his support afforded me. I still respect his opinion as much as my own. He something out of nothing. I made something out of something. Who’s smarter?

#102 nonplused on 12.26.08 at 1:12 am

#97 Peter Piper

The average prices you gave for house prices in Fort Mac are great! The stock market is already back to 2001 lows and worse adjusted for inflation. Can house prices do something similar? Oh yes they can. Less liquid and more emotional, as Garth has pointed out time and again.

#103 squidly77 on 12.26.08 at 3:25 am

who do you think built most of the original housing in ft mac ? the two high rises at the north end of franklin ave were originally called the syncrude towers
in the eighties and nineties ft mac was a virtual ghost town and there were empty and deteriorating houses everywhere
so syncrude and suncor could either watch the place deteriorate into hell or they could invest in local businesses and buy the empty houses and rent them out cheap and hopefully the people would come
these rental agencies were not named syncrude home rental ltd. they were shadow companies
they held onto the places for years and started re-selling them in fairly recent years
theres an entire new neighbourhood being built right now somewhere up on the hill by thickwood
guess whos building it..CNRL
guess whos owns the majority of the homes..CNRL

you could buy a house in ft mac for well under $100,000
in the eighties right up to the late nineties

why do you think that theres a worker shortage in ft mac
is it because you heard it on the radio or read it in the paper..the unions have an unlimited supply of skilled tradesman available for about $30 hr as we can call people from anywhere in canada
when they get here they are housed in 8 x 12 ft rooms and fed institutional food..its ok
union trades people get paid exactly the same in edmonton as they do in ft mac..our agreements are from red deer north to the nwt

the non-union companies have trouble getting people because they pay less and have worse conditions
so people do not want to live in those conditions and receive inferior pay

theres never a shortage of workers but there is always a shortage of companies not willing to pay workers enough money to attract them to stay and work up there

i think that you can put a lot of windows and fixtures in 45 foot trailers and pull them 4.5 hours north of edm

but if you want to drink the media/realtor brewed
kool-aid who am i to stop you

i have worked in ft mac since my teens so thats about 30 years

#104 squidly77 on 12.26.08 at 3:41 am

FORT MCMURRAY, ALTA. — Tenants in one of the largest apartment complexes in Alberta’s oil sands city are facing a rent increase of as much as $1,150 a month

The owners of River Park Glen, known for many years in Fort McMurray as the Syncrude Towers

thats where i stay when i am up there as i am lucky enough to be paid a housing allowance
and by the way those huge rent increases really did happen
there plan was to piss people off enough so that they would leave allowing them to sell the properties off

since they no longer hire security guards there
the syncrude towers are now known as the crack towers its name is justly deserved

problem was they were to late

#105 Tom on 12.26.08 at 3:59 am

#94 Cora – “What should I have paid for it?”. You obviously bought it at a price you thought was appropriate and could afford so the question of what you “should” have paid for it is moot.

And, no offence, but you are part of the problem as you are a speculator who bought into the rising prices hype and sought to profit from real estate. No-one needs two houses. Plus, the fact that you confidently state this house will be paid off in 6 to 8 years shows you’re not short of a buck or two. I think you’re OK compared to a lot of people.

#106 Zoronqueen on 12.26.08 at 4:18 am


Went back to read your squirrel blog… that’s where the generator comments are about. Saw one at London drugs but it need propane to run.

I agree with some others that your predictions might be modest. Edmonton=at least 25 from peak

I too discovered this blog a little too late. Otherwise we might not have bought in Sept and waited another year. And now we have an increasing amount of debt ie. mortgage and if interest rates do go up like some suggest then we will be in deep trouble.

We too are hoping the best and rent out for a few years and hop that D won’t come…..

#107 squidly77 on 12.26.08 at 5:40 am

i like to back up what i say with links..when you blend in the apprentices with journeyman its about $30 hr for a union tradesman..and please dont start on me about the benefits..try collecting them and most jobs (not realtors) have the same if not better anyways

#108 squidly77 on 12.26.08 at 5:54 am

i know i know you read the newspaper and they said that tradesman are making obscene amounts of money
now you the facts..we dont we are blue collar guys and we are lucky to work 8 months a year

#109 Darryl on 12.26.08 at 9:42 am

The labour burden for a union electrician in Toronto is 60 dollars an hour . I’m sure Alberta is similar.

#110 squidly77 on 12.26.08 at 12:05 pm

ELECTRICIANS (PROV.) **…continued…
General Foreman 0.98 35.75 3.575 1.72 4.28 0.48 46.79
Foreman 0.91 33.40 3.34 1.72 4.28 0.48 44.13
Sub-Foreman 0.84 30.77 3.077 1.72 4.28 0.48 41.17
*Journeyman 0.80 29.30 2.93 1.72 4.28 0.48 39.51
4th Yr Apprentice 0.64 23.44 2.344 1.72 4.28 0.48 32.90
3rd Yr Apprentice 0.56 20.51 2.051 1.72 4.28 0.48 29.60
2nd Yr Apprentice 0.48 17.58 1.758 1.72 4.28 0.48 26.30
1st Yr Apprentice 0.40 14.65 1.465 1.72 4.28 0.48 23.00

#111 Mark on 12.26.08 at 12:17 pm

Why not use this negative outlook to make $$$? Buy HFD. I recommended HOD and HFD since July and look where it’s got me…. Check it out on the TSE.

I’m just letting you know that you can profit off the fools. There are ways.

Garth perhaps you should let people know that if housing crashes as severely as the USA then the Canadian banks will indeed take a HUGE hit.

#112 chris on 12.26.08 at 12:26 pm

Hi Garth,
Wait until the U.S. turns to the next chapter of the real estate disaster: aid demands for commercial real estate.

#113 Darryl on 12.26.08 at 1:00 pm

IBEW 353 toronto base 36.40,vac and stat pay 3.64, welfare 3.15,pension5.62, union funds 2.33 total 53.34
what about employers contributions to CPP , UI , insurance,WSIB, training, small tools and consumables. actualy comes out to over 60 dollars. Apprentises and foreman are varied percentages.
Maybe I should open shop in Alberta and make some real money.

#114 squidly77 on 12.26.08 at 2:12 pm

you had this grand illusion that tradesman drove the prices of ft mac homes through the stratosphere
thanks for proving yourself wrong as toronto tradesman make 5% more than ft mac tradesman

and if you think that the benfits are too generous
you to can become a tradesman in 5 short years
and then you to can go to ft mac and live in an 8×12 room and make your millions

#115 JET on 12.26.08 at 2:45 pm

Power of sales (foreclosures) in Toronto trending up but not too alarming just yet. 2009 will be telling…


Happy Boxing Day, eh!

#116 dotava on 12.26.08 at 2:58 pm

#92 Strataman on 12.25.08 at 4:41 pm

Looks that Garth gets slapped. :-(

Merry Christmas & Happy New Year (as much as it’s possible).

#117 kitchener1 on 12.26.08 at 3:07 pm

Its a misconception that trades clean up in Fort Mac. I know of some guys that went down there to work. Sure they make good $, but the reason is that they don;t have any expenses and there is not much to do in Fort Mac. Most of the money is saved (ie. many get a food allowance and room and board for free). Works great if you are 22-23 with a trade and don’t have any expenses as most of these guys live at home with there parents in their respective provence.

Same thing was going on 10 years ago with the longhaul truckers. great money but no life.

As far as the GTA is concerned, you can make the same $ here if your a trade guy, go and rent a 2 bedroom, split it between 3 guys and, work 60 hours/week and save your money.

#118 dotava on 12.26.08 at 3:08 pm

#105 Tom on 12.26.08 at 3:59 am

Can’t agree more.

#119 EJ on 12.26.08 at 3:25 pm

I don’t understand why anyone would buy a house in Ft. Mac or even rent at those prices. Is it not possible to buy an RV and just rent a campsite that has sewer/water/power?

#120 Darryl on 12.26.08 at 3:53 pm

I didn’t say trades drove the prices up squid.I am an electrician and I own a union contracting shop.

#121 David on 12.26.08 at 4:26 pm

Interesting stats on Fort Mac average home prices. From 1995 to 2008 the average annualised compound growth was 15.52%. Those a hefty numbers and are not likely to be sustainable in the future. Wages did not grow by 15% per year, rents did not increase by 15% annually and the rate of inflation was nowhere close to 15%. One can run the various combinatorials of year over year increases for various periods, but the one and only conclusion that can be drawn is misaligned fundamentals. The biggest annualised increase was the period from 1995 to 1998 when the annualised compounded growth was 18.71%.
Garth’s prediction of a 47% price decline in Fort Mac is certainly numerically reasonable, since the correction would only be wiping out 3 years out of 13 years of compounded gains in housing prices in Fort Mac. Even if home prices decline 47% in the next 12 months in Fort Mac residents there will still be stuck with grossly overvalued homes.

#122 Extso on 12.26.08 at 4:41 pm

Everyone must read:

#123 Yalie on 12.26.08 at 5:20 pm

All of this speculation talk about Fort Mac is forgetting one thing: the single dominating factor affecting *fundamental* house values is the availability of land. Ft Mac prices will crash MORE than 50% no matter what happens to the price of oil, because there is virtually an unlimited amount of land to build on, and as long as house prices are higher than the cost of labour and materials, the market will build more housing until equilibrium is reached. This has NOTHING to do with the incomes due to the oil fields nearby. It would be otherwise if there was not enough land to build on, but that isn’t the case way up there.

#124 Noz on 12.26.08 at 7:19 pm

Only 21% for Vancouver, BC? Man…I was hoping for alot more.

#125 dotava on 12.26.08 at 7:50 pm

Sorry Garth but your prediction is kind off. Before we make “reasonable debate” is your numbers (-%) for GTA count from 1st of January next year, or just before Christmas? Also can we be more specific which area we are talking about – Ajax, Oshawa, Scarborough, North York (Aurora, Richmondhill…), Downtown, Mississauga or further toward Milton. When you said -15% did you mean that you eat meet and I eat cabbage –> “in average we eat – cabbage-roll”. LOL
BTW – here in Ottawa – decent house was on sale in beginning of November $300K (bit less), then ten days ago was $285K, today $277K (that is close to 10% just in less than two month).
Anyway until we get back to basic economics that product/s have to have VALID buyer or we will be off (you can’t squeeze juice from dry lemon/fruit).

#126 dotava on 12.26.08 at 8:10 pm

#121 David on 12.26.08 at 4:26 pm

David – I adore your comments – but if we do not start to produce alternative way to harvest energy – someone will (as Japanese & Korean did with cars) . We get lucky to have Tesla & Einstein on our side – but I do not wont gamble the future. Also WWW is replaced with another WWW that suppose to be more human-friendly.

#127 dotava on 12.26.08 at 8:27 pm

I didn’t forget Mr. NOBEL – but I am positive that he is turning in his grave when he see who is getting his prize.

#128 Extso on 12.26.08 at 8:57 pm

One more must read article:

#129 Peter Piper on 12.27.08 at 12:50 am

#103 squidly77

This is 2008 not 1978. Those two towers were once called the ‘Syncrude Towers’, when Syncrude owned them. But Syncrude doesn’t own them anymore. What is your point?

The article you linked clearly stated that the units in those buildings are now owned by a company and on a individual basis.

“Some where up on the hill by Thickwood”, Squidly 77

Are you referring to the Parsons Creek development? I do not know if any of the homes up there will be owned by CNRL, so I cannot agree or disagree with you. But again what is your point?

You omit the fact that many trades people in Fort McMurray make (or made before the construction slowdown) a tax free Living Out Allowance (LOA) which can amount to $3000-$4000 a month.

Also over time is paid at 1.5x after 44hrs a week or 8 hours a day. With 12 hr shifts and (21days on/ 7days off) rotations being common, there is an oppurtunity for a considerable amount of earnings above the base pay you might initially expect.

“Theres never a shortage of workers but there is always a shortage of companies not willing to pay workers enough money to attract them to stay and work up there” Squidly 77

Do you really think that is some sort of revelation?

If a business does not have an attachment to the oil sands, it cannot easily pass along its costs and it cannot afford to pay a competitive wage. Therefore it is hard to attract and retain employees who can afford to live in FMM.

Do you really expect a business to pay a wage that wouldn’t allow it to turn a profit?

There has to be a relationship between the revenue the business can bring in and the wage it can pay its employees.

#107 squidly77 – #108 squidly77

Here are some trades positions located in FMM which are currently advertised on Service Canada Job Bank.


4208639 Boilermaker
Salary: $48.75/ Hourly for 40 hours
Location: Fort McMurray, AB
Date Posted: 2008/12/23

4208646 Insulator
Salary: $42.14/ Hourly for 40 hours
Location: Fort McMurray, AB
Date Posted: 2008/12/23

4208650 Scaffold erector
Salary: $41.52/ Hourly for 40 hours
Location: Fort McMurray, AB
Date Posted: 2008/12/23

4208654 Ironworker
Salary: $45.5/ Hourly for 40 hours
Location: Fort McMurray, AB
Date Posted: 2008/12/23

4208655 Pipefitter-steamfitter
Salary: $47.83/ Hourly for 40 hours
Location: Fort McMurray, AB
Date Posted: 2008/12/23

4208652 Welder
Salary: $47.83/ Hourly for 40 hours
Location: Fort McMurray, AB
Date Posted: 2008/12/23

Do the math with a conservative amount of overtime.

Further proof of the higher then average incomes that can be earning in the construction field in FMM:


Ben Stacey, a pipefitter from Newfoundland, was making as much as $70 an hour in the oilsands when he was blindsided by sudden layoffs. “You can make $70,000 up there in three months,” Stacey, 54, told The Canadian Press from his home back in Grand Bank.

#130 Peter Piper on 12.27.08 at 3:08 am

#123 Yalie

There is a real land and infrastructure shortage in FMM. Significant portions of land that surround FMM are muskeg. You cannot readily build on Muskeg; you would just sink into it. Further, most of the land surrounding FMM which is suitable for building on is owned by the Government of Alberta.


“Candidates will also have to address the chronic land shortage in a city that is virtually an island surrounded by provincially owned forests.”

A large scale land release was announced in earlier this year. But I am unsure of the current status of that initiative.


Two new communities in Fort McMurray will house 40,000 Albertans

The Alberta government is working with the Regional Municipality of Wood Buffalo and various local groups to develop serviced lots for residential, commercial and community uses in the northwest community of Parsons Creek and southeast Saline Creek Plateau.

Additional information about the community development board and project details will be available as the work unfolds. Construction is currently anticipated to be completed in phases with the first housing expected to be available in 2010.

#131 Mike on 12.30.08 at 8:05 am

#129 Peter Piper

FM Wages. 41.52-47/ Hourly.

They sound high, but in fact, that’s 1/2 of what they were 2 years ago! An Electrician in Calgary 1-2 years ago made close to $90/Hour and the Union was asking for $100/hour early 08.

Who would move up to Fort Mac at 50% off wages of $40 hour? Please. We make more in Calgary at the same jobs.


#132 JL on 01.06.09 at 11:31 pm

1) I am looking for info on the Ottawa market. Any suggestions?

2) Any idea how to access the public listing of sold houses in Ontario (i.e. not through an agent)?


#133 malik on 01.26.09 at 11:26 am

Hi Garth,

I really like this website, and I would like your opinion, on a good time to buy the property in 2009 in Mississauga(GTA area),since there has been no significant price reduction,but the sales are down 56%. Any help would be appriciated.

#134 Riz on 01.26.09 at 1:33 pm

There were times when mortgage rates were 18% and banks had lots of playing ground , now the house prices are gone so high that if bank increase a little bit of interest housing market starts slipping.
To keep the banking systems working for “Their” benefit they have to raise the interests but that is not possible to do if the house prices remain same ( people can not afford high interests )
Bottom line …our financial system wants the house prices to come down again and it will be at least at the 10 years ago level… very soon.

#135 X on 07.27.09 at 4:47 pm

The best part of the internet is the accessibility of predictions after the fact.

I just want to weigh in for Calgary:

Dec 2008 Average/Median = 417,398 380,000
June 2009 Average/Median = 447,142 399,000

Predicted: Calgary, KOA 2009 projected change: -15%

Actual = +7% +5%