The property virgin

mcguinty1

Will the last homeowner in Ontario please lock up? And then torch it?

The symbolism could not have been more apt. On the very day when the last ever of ten million vehicles rolled off the GM truck plant line in Oshawa, the province’s idiot legislators pressed another nail in the coffin of real estate. Of course, it’s not enough to face rising mortgage rates next year, the age wage of the desperate Boomers, galloping energy costs and the lingering bitterness of recessionary joblessness, but now the country’s largest province is again attacking the foundation of its citizens’ wealth.

Just to recap for those who were in the john:

First, Ontario passed the legislation necessary to allow a second tier of land transfer tax to be imposed. And so the real estate-hating junta running Toronto did exactly that. Now when you buy a home in 416 country you have to pay this levy twice, once to the province and again to the city.

For example, to buy a $500,000 home (which will not even get a half-decent semi in most areas), the charge is $6,475 for Ontario and $5,725 for Toronto, for a total theft of  $12,200. This, of course, is in addition to city property taxes, provincial sales taxes and every other tax.

dalton Second, the McGuinty government has decreed it will harmonize the PST with the federal GST. That means provincial sales tax of 8% will now be levied on all charges associated with buying a home. So, on that $500,000 unit, this means an extra eight points on the commission (which the seller will want to recoup in the sales price), or $2,400 on the standard 6% levy, plus tax on legals, moving costs and all else.

Worse, the PST also clicks in on the full purchase price of new units costing more than $400,000. So, in the case of our example above, this adds another $40,000 to the cost.

Having fun yet?

Third (as of hours ago), the province’s new Green Energy Act requires that anybody selling a single-family detached or semi-detached home must provide an energy audit to the buyer. This will cost $300 – but that is hardly the point. This added requirement has the potential to scuttle a deal once it is already inked, if a buyer decides they don’t like the audit results. It makes virtually every offer conditional, since getting an energy audit could now take weeks – precious time a buyer has to change his mind, shop the market for a better deal, or use to hammer down the seller’s price. It adds complexity, uncertainty and  redundancy – since most buyers already know enough to request a building inspection.

Finally, as you might imagine, this devalues older homes while it disadvantages their owners. It’s an example of government intervention at a time when it is least helpful, even in the cause of energy conservation. The only way this can be avoided is for the buyer to waive the audit condition in writing – which no sane purchaser is going to do, since the process is completely in his or her favour.

There was a time I thought Dalton McGuinty was a pragmatic guy. But screwing property owners must come come easily when you inhabit a cloud.

133 comments ↓

#1 North Vancouver Citizen's Analyst on 05.14.09 at 10:03 pm

I have no problem with all these extra fees for people who buy and sell houses, in fact I applaud them because:

A) It will destroy the speculative bubble in real estate and bring prices down to where they should be and

B) It will destroy the speculators themselves who drove up prices in the first place putting them out of business once and for all. These worthless human beings are no better than ticket scalpers.

As long as they don’t start hiking property taxes on everyone for the mere privilege of living somewhere then I think this is fantastic.

After all, most people only need to buy a house once or twice in a lifetime.
If they want to start making a frequent habit of it, then f**k ’em – they can pay.

#2 Hmmm... on 05.14.09 at 10:04 pm

Garth, you were critical of the government providing 0/40s or today’s low low interest rates as incentives to home owners.

Now you are highly critical of a round of taxation and regulations that serve as disincentives…

What exactly do you want the goverment to do?

#3 lgre on 05.14.09 at 10:24 pm

Granite countertops and hardwood floors outweigh everything else..so the dull knives buying RE today, will just waive the audit as they have done with inspections …I dont see it becoming a problem in the short term..

#4 dd on 05.14.09 at 10:27 pm

Ontario must just love taxes. Ya … raise taxes in a recession. Not too bright.

#5 eddy on 05.14.09 at 10:44 pm

Dolt On McGuilty is the dodgiest dude I’ve ever heard. One radio interviewer said questioning Dolt On was like ‘trying to nail jello to a wall’

David Miller is the biggest waste of space in the cosmos. A socialist who sits with impunity in the pockets of big developers turning Toronto’s waterfront into a soulless concrete eyesore.

#6 Sherry on 05.14.09 at 10:45 pm

Why is anyone surprised? Dalton McGuinty proved to be incompetent when he was FIRST elected years ago. Does everyone forget the grand-standing about no new taxes – and then what does he do the minute he gets into office – he raises taxes (aka health care levy.)

The guy has only one strategy – tax tax tax. It is absolutely BEYOND ME why he won with such a landslide this last election. (ok – we can probably blame John Tory and his faith based school debacle for handing it to him.) But really. The people of this province have very short memories. Either that or they love being taxed to death. Or they are dummer than McGuinty… I just don’t get it.

#7 hal smith on 05.14.09 at 10:46 pm

The reason we are house crazy is because it’s the safest investment out there.Remember the Nasdaq? The tech bubble? Lotsa people lost their shirts on that one. Enron? Bre Ex and Nortel? CEO’s making 10 million a year and private jets and yachts?Bernie Madoff? Mortage backed securities and CDO’s ?Creative accounting? Even your own government lies, cheats and steals from you. Remember the income trusts? So what is left? Real estate. You gotta live somewhere so you may as well live in your safe investment . Nobody can steal it from you or cheat you out of it and you don’t have to pay some asshole 10 million a year to manage it for you. And you don’t have to pay capital gains. For the average person, what else is there?

#8 squidly77 on 05.14.09 at 11:23 pm

i am no friend of government fees and/or interference into the once free markets how ever the high cost of completing real estate transactions will curb speculation
and prevent realtors from doing phony paper sales amongst each other to juice the stats

is it theft from the present home owner ? probably
but owning property is full of risk
these extra charges will be at the present owners expense

but we can never allow speculation in a basic human need such as housing to happen again

an imperfect solution to an imperfect situation

#9 kc on 05.14.09 at 11:27 pm

I had to comment on this point….. “Finally, as you might imagine, this devalues older homes while it disadvantages their owners.”

Last Nov I moved from a house built in the 80’s into the current place that was built late 50’s. It still has single pane windows and is in great shape for the years. all winter in this house we were warm with minimal drafts. The house we were in for 2 winters (80’s house) felt like a fridge half the time… I would’t buy any of the POS houses/condos that the builders are flogging today. I have watched too many being slapped together and how they pass any home builders inspections are beyond me….

Any buyer might have just been handed a good blessing if these new taxes were to hit the west coast.

my 2 cents worth. cheers

#10 Dee on 05.14.09 at 11:29 pm

They backed down on the audit.

Real estate should slow down. If people can afford the 400K then they can afford to pay the tax. To compare ON to the Republic of China is ‘too much’ even for you Mr. Garth. Unless you thinking iron rice bowl?

http://www.telegraph.co.uk/news/worldnews/asia/china/5316145/America-threatens-trade-war-with-China.html

I’m guessing but when you owe a foreign nation a lot of money it tends to build some resentment. Artificially holding down inflation over the years will do that to a country.

You go U.S.A. and show/them how monetary policy is supposed to work.

#11 asp on 05.14.09 at 11:34 pm

Will not all these measures help prevent future real estate bubbles. And deflate the current one? Even though that is painful, it is necessary, no?

#12 dbg on 05.15.09 at 12:06 am

Hmmm sounds a little bit like Canada.

http://www.nytimes.com/2009/05/14/business/global/14frugal.html?em&exprod=myyahoo

Maybe we could be a little different than our southern neighbors.
But that wouldn’t fit the doom and gloom crowd now would it?

Cheers,

#13 Grumpydawgs on 05.15.09 at 12:17 am

Is this ‘the’ reason that a blip in house sales has occured in Toronto. Was it just a few able persons squeaking in under the wire? We’re talking about the better part of a hundred grand in taxes to purchase a starter home. Wow!

#14 PW on 05.15.09 at 12:58 am

…next will be PST/GST on rental payments…

#15 . . . fried eggs and spam . . . on 05.15.09 at 1:13 am

With Gordon Campbell and the BC Libs. having been re-elected for a third time, combined with all the public money they are spending to have bang-up shindigs at the Olympics with public funds, it seems as if they are more NDP than the NDP.

Sure there are certain projects that have to be funded regularly — maintenance and replacement of equipment, upgrading to new stuff, etc. But to have all these unnecessary expenses happen within such a short time span, then obviously taxes in one form or another, will have to be raised in order to pay for all this.

Maybe no one noticed the economy is tanking, and more of these expenses are being loaded on to the taxpayers. These twits are doing what Harper and Flaherty did not too long ago — buy votes by throwing money at people, do just about everything that common sense not to do.

Could be that Mr. McGuinty took his cue / lessons from the feds. to screw Ontario up royally. It will be curious to watch if this style of governing becomes a developing political pattern.
——
Link shows that a country can enjoy fiscal freedom, PROVIDED they don’t spend all their money by going to war. — http://tinyurl.com/pznrqp

“. . . in the midst of the worst global downturn since the Depression, Norway’s economy grew last year by just under 3 percent. The government enjoys a budget surplus of 11 percent and its ledger is entirely free of debt.”

Webmaster’s Commentary: “These folks are obviously doing something right, and the US can learn from them. And to the best of my understanding, Norway hasn’t invaded any other country for quite some time. All monies going to wars without end are already dead-ended, which is a big part of the reason the US government is broke, and it looks like the US’s financial shape is getting worse rather than better.”
——
A classic example of catching sheeple off-guard. Speaking of another ‘false-flag’ accident . . . — http://tinyurl.com/ojwljt

“CIA chief Leon Panetta has held secret talks in Israel with top officials who assured him the Jewish state would not launch a surprise strike on Iran, a report said.”

Webmaster’s Commentary: “The plan is we knock down something really big inside the United States and then blame Iran for it, and let the Americans do the rest!”

Which is followed by the opposite side of the coin. — http://tinyurl.com/omgzxx
——
My guess is that a war will happen much sooner — wait until those dumbass Olympics are over, then look out! — http://tinyurl.com/pnmvpz
——
Now the UK is mired in deep doo-doo. — http://tinyurl.com/rao2gy
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Climate change, global warming or cooling? I are very confuzed by ‘dis! — http://tinyurl.com/p3stbg

#16 double mike on 05.15.09 at 1:36 am

Good stuff. Sales tax on non-owner occupied RE would help too. Won’t happen of course. But one can dream.

#17 chibidani on 05.15.09 at 1:50 am

While prices are over the top in Vancouver & area, its still better than what you just described. No wonder people in Ontario have jumped on the spring bounce!

#18 Mike (authentic) on 05.15.09 at 4:31 am

There was a time I called Ontario (Toronto) home for 27 years (my family is still there). Like any Torontonian in those times (1971-1998) I survived through the good and bad, recessions, gov’t spending cuts, job losses and some good times as well.

When will the majority of people of Ontario stand up and vote no? Or write their MP’s, or do something re-active if not proactive?

When I come back to Canada in October, Ontario won’t be the prov of choice to move back to and buy a home.

Taxes are a necessary evil but unfair taxes are an evil. A balanced need to be maintained.

Once the Ontario Gov’t gets used to the new added tax revenue they will want more like any tax before that (income, GST, user fees, “OHIP”…)

Sad really. This is going to ironicly hurt the existing tax base and in the end raising taxes may not get generate much more revenue for them.

Mike

#19 wjp on 05.15.09 at 6:12 am

Add to your list: the continuing escalation of property taxes…

#20 Maurice on 05.15.09 at 6:35 am

Beware Friends: Let us discuss the Energy Audit Scam. We had an Eco Energy audit performed on our 1979 vintage home. The results recommended renovations including a Geo Thermal Furnace. The payback for the $70,000 in renovations, with a $14,000 government rebate was to reduce energy consumption, from 125 gigajoules to 35 gigajoules a year. Sounded great. We did the work, no reduction in hydro consumption was experienced. NONE. This generated economic ,”above ground” activited. No cash payments as invoices are required for the rebate. Lots of tax revenue for the government and nothing other than visual benefit to the home ower. Oh yes, we also a visit from MPAC to up the assessment on the house since a building permit had been issued. Get the picture. Home owner get screwed.

#21 wjp on 05.15.09 at 6:51 am

Stocks up…stocks down? – Here’s an opinion…
http://www.reuters.com/article/newsOne/idUSTRE54D4IL20090514

#22 pbrasseur on 05.15.09 at 6:58 am

“Having fun yet? – Garth”

Well, do you want that welfare state or not?

Utopias aren’t cheap, you ain’t seen nothing yet…

#23 David Bakody on 05.15.09 at 7:18 am

Another find enlightenment Garth ….. for those who have not lived the HST please take a seat. Once it is in place everything will be taxed even that chewing gum a politician once was called out on ….. so be prepared.

Many years ago I read an article that by the turn of the century home owners would be paying more in taxes and service fees for their home than their original mortgage ….. Hello?

To-day the new world order is taking effect as unemployment rises, self employment rises, stiff competition for the best jobs, longer harder hours to keep the good jobs, trade unions falling driving down wages and benefits down and out all to the merry tune of greed/ profit for Big Business. The financial institutions that survive will thrive, think the world is now dealing in TRILLIONS gone are billions and the big world bankers have control …. we are but ponds sacrafical at best …. so why help them , pay down debt and save wisely while living within your means.

#24 Munch on 05.15.09 at 7:53 am

I was in Toronto 2 years ago, visiting the central bank – they gave us a tour of the gold vaults, quite impressive

I recall going down to the waterfront (lake shore) – yes, it was decidedly bleak, as your one poster observes.

We had steaks there – we had to order two each to get the same size serving we get for one here in South Africa.

Flew Air Canada, which was crap!

Just saying …

Munch :o)

#25 eddy on 05.15.09 at 7:58 am

green energy act is a fraud, like ‘drive clean’. why single out the point of purchase for audits, why not cram down the audits on all existing homes, like they do with cars? or better still, a license to own a house, renewable every year. put seniors with low R value homes in jail.
it looks like provincial employees have too much idle time on their hands, Dolt on should concentrate on balancing the provincial budget, oh , i forgot, he said he does not want to do that. translation=out of control spending=more taxes

#26 CalgaryRocks on 05.15.09 at 8:08 am

When I come back to Canada in October, Ontario won’t be the prov of choice to move back to and buy a home.

Same here buddy. When me moved back from Florida 5 years ago we didn’t really consider Ontario even though we are both originally from out east.

That was during the ‘good’ times. Nowadays you’d have to pay me to live there. Literally, I would only live there if I was on welfare or on the dole.

The only reason to work in Ontario is so that you can make enough money to move out of Ontario.

#27 dd on 05.15.09 at 8:14 am

#8 squidly77

“but we can never allow speculation in a basic human need such as housing to happen again”

It wasn’t the speculation that was the problem. It was leveraging that speculation to tap out the equity.

#28 Dodged a Bullit in Alberta on 05.15.09 at 8:15 am

Greetings: This energy audit program is another government scam with politicans kissing arses of the industry lobbyists. How much energy is wasted by leaving highrise office buildings lit up 24/7, running AC in empty buildings, schools sitting unused while community groups struggle to find space? However the homeowner needs a 300 dollar audit to get a piss assed rebate, plus the expense of reno work. I can buy a huge amount of natraul gas even if the cost doubles, instead of spending 4 or 5 thousand to replace perfectly good windows on a 30 year old house. This is the same type of scam as the CFL, only industry benefits, not the environment.

#29 Kris on 05.15.09 at 8:22 am

It’s a big world out there folks and we enjoy freedom of movement. If you don’t like the taxes in Canada, then pack your bags, cinch up your huevos and move to a low tax country instead of hanging around here crying about it like a big baby.

But I’ll bet you start pining for good old safe Canada after you get robbed the first time.

#30 smw on 05.15.09 at 8:50 am

Well said Garth.

I wish McGuinty’s reign of terror would soon be over, but Toronto has the votes, and the special interest population. Looks good on them now, at the cost of the public’s wallet.

For the most part I’m a political atheist, but have Progressive leanings, as most Canadian’s do. I’ve paid my $10 to the Ontario PC party so I have a chance to get one vote in on the guy that I best think will get rid of this current Ontario. A premier who actually thinks by fucking around with stupid tax policy and other gimmicks, he’ll steer the ship straight. Sounds like our PM, with little changes like the GST, or 5 extra years of amortization. They may seem like blips but bad policy and little “fixes” here and there is what made the depression so great.

The ship was fine before he got in, it just required some “suck it up” factor, like the whole country did during the 90’s. I guess seeing the western and eastern provinces prosper while Ontario had to suck it up was too much for Dalton and his political aspirations.

If your out of work and out of luck in Ontario, RUN to Newfoundland or Alberta/Sask…

The funny joke of all these people running into real estate at the “Mcguinty Threats” is their cash or equity is disseminating with each new piece of legislature this incoherent asshole brings in.

#31 smw on 05.15.09 at 8:55 am

#29 Kris

“But I’ll bet you start pining for good old safe Canada after you get robbed the first time.”

Yeah right, much better to be blatantly robbed by politicians via inflation or taxation…

#32 Nostradamus jr. on 05.15.09 at 9:00 am

…Prediction Time Once Again…

Prices of consumer manufactured goods…all autos and everything manufactured in China…will begin dropping later this summer.

…I actually predicted this nearly 500 years ago.

#33 smw on 05.15.09 at 9:03 am

#1 North Vancouver Citizen’s Analyst

You could be right on A and B, but that isn’t why these policies are being implemented, if it does work out that way it will be sheer luck.

The average home will be $399,999, only 4.5 times the average family earnings per year($70K), or about 50% of after tax family income to service the debt, taxes and maintenance on that “investment”.

I hope little Billy like potato sacks for clothes.

#34 buy gold on 05.15.09 at 9:14 am

Third (as of hours ago), the province’s new Green Energy Act requires that anybody selling a single-family detached or semi-detached home must provide an energy audit to the buyer. when does this take affect? if i’m selling my house at this point will i have to provide a energy audit?

#35 D from London, ON on 05.15.09 at 9:17 am

#28 Dodged has an excellent point –

Does anyone out there know how much energy is used in heating, A/C and domestic electrical use versus that used for commercial and public purposes (offices, warehouses, stores, schools, etc., etc.)? I am just guessing, but household use of these things must be less than half the total consumption. And that amount is parsed into millions and millions of individually controlled places, with many people making the day-to-day decisions. The Green Audit must be the MOST inefficient way possible to reduce energy consumption, at the highest possible cost. However, since homeowners are so distributed it is difficult for us to band together and wield lobbying power. Large landlords, developers and others are so concentrated that it is easy to band together and wield significant political power to avoid being forced into investing in real energy-conserving initiatives.

This reminds me of the current “pesticide ban” which just came into effect in Ontario. While no one would be safe arguing against this “motherhood and apple pie” issue, the real story is that less than half of pesticides used in Ontario are used on household lawns. Most are used in agriculture, golf courses etc., all of which are exempt from the ban and may continue on their merry way without investing in alternative ways to greatly reduce pesticide use.

Both of these are easy ways for gov’ts to “look green”, without actually reducing use and without upsetting the real users of the substances, who have real political power.

#36 CalgaryRocks on 05.15.09 at 9:22 am

#10Dee.

Maybe you are right, maybe they can afford an extra 40k in taxes. But let’s talk about you now, what is it that you have that you wouldn’t mind the government stealing, err, taxing from you?

Please, it’s only fair. If you have some extra why not give it to Dalton so he can help out his friends? Hmm, I mean the poor, yes, that’s it, the poor.

#37 Eduardo on 05.15.09 at 9:27 am

More reasons to move to Alberta.

#38 Bill-Muskoka (NAM) on 05.15.09 at 9:29 am

There was a time I thought Dalton McGuinty was a pragmatic guy. But screwing property owners must come come easily when you inhabit a cloud.

I could not agree more. McGuilty has been sucking down the Blue Kool-Aide from Harper’s office apparently.

This has to be the stupidest tax plan I have seen in all my life. What’s next the former Indiana Governor Otis Bowen’s, M.D., ‘Peter Tax’ plan?

That is where the length determines that tax rate.

Under 6 inches is a Nuisciance Tax

6-8 inches is a Usage Tax

Over 8 inches is a Luxury Tax.

The legislature argued that the tax made no sense because it is out of work 90% of the time and besides it supports two dependents who are noth nuts!

#39 Calgary_sucks_dot_com on 05.15.09 at 9:47 am

Garth, so many nice things in Ontario. All this hubbub about cars going under, stocks falling, house costs going down. People for the most part have enough to eat. Why worry about the rest? Are these people worried about their house equity actually producing anything such as fine paintings, music, anything? Hardly. Its no different than the dark ages and serfdom just in a different form.

By the way, if Ontario is so awful, come to Calgary. Congestion and stupid conservatism. Traffic, green light cameras, stuck up broads, idiots, cops, etc. And a cost of living like New York City in a slow prairie town. The only reason to live in calgary is work, nothing else.

At least in places like Thunder Bay you have lakes and nice scenery. Theres only a view of the mountains here and no trees. Hopefully that automaker crap will put more oil conservatives out of work here so house prices will collapse.

#40 Devil's Advocate on 05.15.09 at 9:48 am

TAX, TAX, TAX, Expect more folks.

And to those who comment that it is not a problem, which quite obviously you are a short sighted renter who hopes to one day own, these taxes do not make homes more affordable. These taxes ultimately will be reflected in higher rental costs as landlords pass it on to the renter. In turn that will cut into your ability to save for a home of your own. And if you do manage to save a significant amount of what you pay will go to such taxes. You will be stuck in that shitbox $500,000 rental paying the $4,000 per month it takes to justifiy it being so for any landlord to contemplate buying and renting it in the face of other investment opportunities which will soon pay a 10% return as interest rates rise.

So… you think this will be punative to the elite who can afford a home? Not a chance so much as it will be punative to those who rent and never now be able to afford a home of their own.

#41 Signal Loss on 05.15.09 at 9:49 am

Man people are harshing on Ontario huge here. Look, nobody is a ‘fan’ of taxes. They suck. They distort investment decisions, blah blah economicsreligion 101 blah blah..

But the government is in the end the only entity willing to provide certain public goods that we all rely on. Ontario is laying the groundwork to try to pay for it, so that when things really hit the fan as we move forward in 21C there will be some capacity on the part of the crown to do something. Still i admit, when Garth lays out the costs like that it’s cringe inducing.

#42 Soylent Green is People on 05.15.09 at 10:03 am

About buying versus renting: Can we talk about how horrible it is to rent?

You have to live next to hillbillies and arseholes who use their stereo to mask their insecurities about the world. People you would normally cross the street to avoid you have to live cheek to cheek. They never play music you like, and even if they did, all you get to hear is THUMP THUMP THUMP. Petty power struggles on daily basis.

Bugs. You can do nothing about other renters not cleaning their places no matter how much a clean freak you yourself are, doesn’t matter.

Cigarette smoke. Do you know how horrific it is to sit in your living room and have the place stink to high heaven because someone upstairs is smoking a pack a day? This after you answered an ad stating: No Smokers. It’s a nightmare, especially when you have children in the house. People are not allowed to smoke in a bar but go home with your kids and you are exposed to noxious second hand smoke.

And the noise. What is it with people leaving their shoes on to pound around on the hardwood? It’s hardwood, it’s noisy, it sounds like an earthquake from below. Take your shoes off you clod, plus it will keep your place cleaner.

How about the basement suite cladded in 60’s wood panel that your landlord won’t let you paint out in white because heavens… it’s wood! Even when you offer to pay for the whole thing. Oh God, preserve the wood at all costs, even though they don’t have to live with it. Talk about ugly and depressing.

How about landlords telling you how to arrange your furniture or nagging you to turn the lights off or not turning heat on when it’s still cold? It’s hard to have engery when you are constantly freezing.

I know why people buy houses.

Renting does not mean a multi-tenant building. Compare apples and apples – buying a $400,000 home versus leasing one. — Garth

.

#43 Mark on 05.15.09 at 10:17 am

Garth,
I agree that there are a lot of tax hurdles for home buyers. We just put our house in my finance’s name (as she is a new home buyer) to avoid some of the property taxes. The HST is just another roadblock for people purchasing a new home. Shocking.

I just did some reading on the energy audit. It seems that the provincial gov’t has backed down on the mandatory audit according to this.
(http://www.yourhome.ca/homes/article/625446)

As I wrote, the audit can be waived by the BUYER, not the seller. And why would a buyer do so? No compromise here. — Garth

#44 U.S.$fromA$iaComming home= inflation on 05.15.09 at 10:21 am

I love it, there is no better time to be homeless!!! :P

Election is comming Garth! You better run or be shunned.

#45 Mirror on 05.15.09 at 10:53 am

Although the only thing we seem to produce is oil, standard of living will continue to deteriorate in Canada/US. We will have no manufacturing base left, the only innovations happening now a days are exotic CDOs and most of us are overpaid for what we do compared to the human resources in the emerging markets. So, we cannot compete with them.When you have job losses and capital market meltdown, the only thing left standing is your home. With house prices recovering (not only in Canada), this seems to be the only way to wealth creation.

#46 LivinginBDA on 05.15.09 at 11:02 am

We are a family that moved from Canada to Bermuda a few years ago to try and get ahead. We are thinking about returning to Canada (416,905) as our main reason for moving here was to be able to pay cash for a home. Would we honestly be better off buying the house before the PST kicks in or will that be offset potentially by the reducation in prices??? Thanks

#47 Bill-Muskoka (NAM) on 05.15.09 at 11:04 am

B) It will destroy the speculators themselves who drove up prices in the first place putting them out of business once and for all. These worthless human beings are no better than ticket scalpers.

#1 North Vancouver Citizen’s Analyst

EXACTLY! They add NOTHING to the value of a home, they just flip them or rent them out and let the tenants destroy them, and leave a mess in the neighborhood. For proof look around Barrie, ON.

Our daughter had one next to their nice home. The ‘Speculator’ did NOTHING to maintain the property, then after running up a huge line of credit went bankrupt. The place was originally worth abouth $200K. After the renters destroyed the interior and yard the bank was asking $268K to liquidate their debt. It sold for under $200k. The yard is still a mess, but the new owners are trying. They will have to spend several thousand to even get the dump into proper shape.

#48 Calgary37 on 05.15.09 at 11:05 am

Urban Survival Update

For those of you who are not already regular readers of George Ure’s writings, I recommend that you start today.

Today, George starts with an update on what he expects to happen by the October-November period. He also elaborates on a discussion of other dimensions that he started on Monday – third density, fourth density and hearing voices from nowhere. (Just scroll down to the bottom for Monday) Some of you may recognize some of what he is discussing.

http://www.urbansurvival.com/week.htm

Enjoy.

REMINDER: A major collapse in the United States is bound to have an effect on Canadians. (are you ready?)

Power to the People. Let the Revolution Begin. (Are You Really Ready??)

#49 Mike (authentic) on 05.15.09 at 11:11 am

CalgaryRocks “Same here buddy. When me moved back from Florida 5 years ago we didn’t really consider Ontario even though we are both originally from out east. The only reason to work in Ontario is so that you can make enough money to move out of Ontario.”

That’s what I did myself, 28 years in T-Dot then moved to Kelowna, BC for 2 years then to Calgary for 8 years. It will be Caglary when we go back to Canada, not Toronto now. I do miss some aspects of Toronto, but I can fly over and visit for those.

Love Kelowna, but talk about expensive and little (and low paying) work…argh.

Mike

#50 Rich in Calgary on 05.15.09 at 11:21 am

Well I guess we can all relax now.

I just saw the cover of Macleans magazine, and it states that the worst of the recession is over.

Boy, they sure seemed down on the economy just 6 months ago, but now everything is rosey?

Oh well, try to enjoy the long weekend!

#51 PTDBD on 05.15.09 at 11:21 am

The Prestidigitaion Levitation Nation

– Obama says “the stars have aligned” (must have been watching an All-Star game)
– Obama says America cannot borrow forever, as they borrow even more
– America’s largest insurers to get TARP bailout
– Americas’s largest trucking company to ask for TARP bailout
– Americas tent cities growing
– gasoline prices rising again because “quantitive easing” is creating more paper dollars, so commodities get more expensive
– read The Automatic Earth for articles from a wide variety of sources which examine the American housing market.

That TARP is being stretched…and it won’t get better while people are still parroting the mindless
:-) going forward :-)
:-) moving forward :-)

#52 Calgary37 on 05.15.09 at 12:00 pm

Swine Flu Pandemic Hoax Update

If you want to find out the background on all of the fear mongering about flu pandemics over the past few years, start with this long article.

http://www.rumormillnews.com/cgi-bin/forum.cgi?read=146851

It is still possible that there will be some type of flu pandemic started up later this year. IMHO it may an updated version of the 1918 Spanish Flu that will be more lethal than the original. BTW the original was made at an Army base in Texas. The updated version may come from Fort Dix in Maryland. To add to the confusion, I am expecting them to spread two other viruses such as SARS and/or the current hybrid version of swine flu that also came out of some Lab.

There will probably be an attempt to have a mass vaccination program for this probable outbreak later this year. The advice from the experts who do not work for the Government or TPTB is “do not volunteer for any vaccinations” and try to keep your immune systems healthy.

Stay safe.

Power to the People. Let the Revolution Begin.

#53 PropertyGuy on 05.15.09 at 12:04 pm

Garth, in one post you criticize the real estate industry for pumping out all sorts of Real Estate Porn in order to get more people to buy homes and now you sound just like them being critical of the HST on the already outrageous RE Commissions.

The most critical and vocal opponent to the HST is OREA and the agents in the Province. Gee, I wonder why – could it be because it makes their proposal to sell a home that much less attractive?

This is a tax you don’t HAVE to pay. How? Don’t use the agent, sell it yourself – it’s not rocket science. Pocketing the Commission plus the 13% HST could easily pay for that energy audit.

FSBOs almost always net the buyer less, not more. Without the muscle of MLS, the exposure of your property is minimal. This is usually a bad decision, made by the inexperienced. Hate them if you want, but realtors have a marketing net second to none. — Garth

#54 My_View on 05.15.09 at 12:05 pm

Just pick up my new boat, dam does it look good in my driveway. EVERYONE TRY TO HAVE A GREAT WEEKEND!

#55 Grumpydawgs on 05.15.09 at 12:11 pm

Bill C-6, another attempt at eroding our personal freedoms. C-6 is an old dog with a new name being pushed through by the big-pharma lobby. Sheeple, you say? Baaaaaaaaahhhhhhhhhhhhhhh it is.

http://www.youtube.com/watch?v=X7_0HlCwb8A

#56 jess on 05.15.09 at 12:19 pm

“until” what a good word more definitive
peak point on a graph….this is better than the schreiber commission but make sure you bring out your foam brick before you view.

http://www.c-span.org/cspanFLVPop.aspx?src=project/economy/econ051309_aig.flv&s=2635.5460000000003&e=0&live=N&popup=Y

#57 Calgary_is_a_joke on 05.15.09 at 12:27 pm

Soylent Green:

That sums up renting in an apartment-and its around $1400 a month in Calgary. Of course you want to buy. And then watch you lose your downpayment when your equity drops. The solution to dealing with those a-holes in your midst? Ignore them. Act like you are at work-do your own thing.

#58 smw on 05.15.09 at 12:42 pm

#42 Soylent Green is People

Your post gets the “ignoranus” or to be more politically correct, “succesful government and MSM programming” award of the year.

How many times do people have to post the differeitials to renting versus buying, and how off kilter it is before you’ll wake up.

My family builds $16,000 to $20000 of savings a year by paying $1200 a month renting in a upscale neighborhood. The total costs of buying an equivilent low end home in the area is $2200 for the mortgage plus the additional tax, insurance and maintenence, which can be upwards of $1000 easy.

Five years of being a hilly billy nets me $80 – $100K.

Then portions of that gets dropped into equities, cash and bonds. So while your promoting people to buy at the top of the market in housing, I’ll stand on the sidelines and jump into the markets and buy real deals.

Until the interest rates were dropped to the lostest they can, the Candian RE market moved sideways in 2008, and would be down if we weren’t up to our eyes in “IT”.

So in closing, some rent because it has superior value to buying right now, some rent because they have too.
I rent where I am because I like the neighborhood and when the right little old lady bites the dust, I’ll have my 20% cash payment for the bank, and trust me, they’ll be all over my crotch at that point.

Stupid hillbillies.

Enjoy your “low rates” and “high principal”…

A big Moo for you and they rest of the herd that see it so clearly, your way.

#59 Another Albertan on 05.15.09 at 12:45 pm

BOAT = Break Out Another Thousand

#60 The End is Not Nigh on 05.15.09 at 12:58 pm

Anyone consider that they are trying to stop people selling? If you want to slow the amount of properties on the market what do you do? … simple, make it really expensive to buy and sell which in turn makes demand higher for the few that are listing and then we see multiple offers and prices sustained for the time being.

End result is higher prices, housing crash postponed plus cash for the taxman and realtor.

This is just buying time as at some point people will be so underwater with interest rates that they will have to sell anyway… this current housing market is insanity and we are nowhere near the end.

#61 Seanmhair on 05.15.09 at 1:00 pm

#42 Soylent Green is People on 05.15.09 at 10:03 am

About buying versus renting: Can we talk about how horrible it is to rent?

Really? We owned a house…once. Had neighbours from hell. Sold the house at a loss to get away from them. Have happily rented since. We have freedom. We have options. More importantly, we have a great and responsive landlord with whom we recently negotiated a 40% decrease in rent due to the fact that I lost my job. (she didn’t want to lose us). Try that with your mortgage holder!! Lousy accommodations/landlords are out there…but so are caring and responsible ones. Just takes time & effort to find them.

#62 Ultraman on 05.15.09 at 1:15 pm

“I love it, there is no better time to be homeless!!! ”

Like they say, you don’t have the trouble of what you don’t have.

#63 hagbard on 05.15.09 at 1:18 pm

Just waiting for the entire bloody lot of fall and anarchy to reign. We’ll all be better off without the State.

#64 Cave Spot on 05.15.09 at 1:26 pm

“FSBOs almost always net the buyer less, not more. Without the muscle of MLS, the exposure of your property is minimal. This is usually a bad decision, made by the inexperienced. Hate them if you want, but realtors have a marketing net second to none. — Garth”

Actually a comprehensive study was done in 2007 that indicated FSBO’s generated more money for the sellers than a MLS sale. However it generally took much longer to sell a FSBO property. A link to the study can be found here:

http://faculty.wcas.northwestern.edu/~ane686/research/fsbo.pdf

This is not Wisconsin. — Garth

#65 Dan in Victoria on 05.15.09 at 1:34 pm

Thanks for that post today Garth,that absoutely is a reciepe for disaster. I had no idea of the costs.Stunning.Sounds like the taxpayers in California are starting to rebel. http://www.usatoday.com/news/nation/2009-05-14-budgetshowdown_N.htm

#66 Greg W., Oakville on 05.15.09 at 1:59 pm

Hi Garth, FYI: Halton Hills on the MSN investing today

Fighting back: Small town says turn-around fair trade in ‘Buy America’ battle
Julian Beltrame, THE CANADIAN PRESS
May 12, 2009
http://finance.sympatico.msn.ca/investing/markets/marketnews/article.aspx?cp-documentid=19736782

#67 Jusuppow on 05.15.09 at 2:02 pm

@ #54 “Just pick up my new boat, dam does it look good…”

My_View FYI. The Jones (the ones across the street) just brought in two new boats and damn they look awesome. Stay alert or you may fall behind.

#68 David Bakody on 05.15.09 at 2:25 pm

#40 Devil’s Advocate on 05.15.09 at 9:48 am

You are so right Sir/Madame …. now let us see what Harper really did with his PPP plan by demanding local and provincial governments anti up 50% of his so called stimulus money. We will be taxed extra by both governments while the greater share of stimulus pot of gold goes to non tendered government contracts and friendly financial institutions and other CON supporters. The banks (all) are starting to play recovery games using white chips now …. next comes red and then blue. Let the money games begin!

#69 . . . fried eggs and spam . . . on 05.15.09 at 2:25 pm

#48 Calgary37 11:05 am — “REMINDER: A major collapse in the United States is bound to have an effect on Canadians. (are you ready?)”

Good sentence, and when the collapse happens, it will radically affect and alter lives thruout the world, so as to your question, no I’m not ready and probably never will be, but that is my freedom of choice.

A few links, separate but when placed side by side, one realizes that this continent is royally screwed.

I figure the second half of ’09 is when the worldwide temperature on everything starts rising, and from then on — possibly longer than a decade — the globe reaches scalding point.

For instance, from Money & Markets — http://tinyurl.com/o3k6sv — “. . . What happened? Simple. Uncle Sam spent money he didn’t have! Government spending surged 17.5 percent year-over-year, while revenue plunged 34.1 percent. . . .”

In case anyone forgot, add the following to this mix — http://tinyurl.com/ryls6t

Yet this (possibly) contradicts the above — http://tinyurl.com/r8qava — but ‘the economic fundamentals are strong!’

Sooner or later — actually, much sooner — this whole mess has to flatline, or pancake out.

The economy IS the unsustainable lifestyle. Unfortunately, most have become accustomed to this and in doing so, have become lazy and complacent with life, expecting life to serve us.

Folks are gonna get one helluva whack between their eyes to wake them up, and that is when they will understand that one has to put some effort into life in order to get something back.

#70 Barb the proof reader on 05.15.09 at 2:34 pm

If this kills the speculative market, then it’s good. Get rid of the greasy slime-wads.

Homes are for people to live in.

Greedy property speculators and insecure sheep who need granite countertops do not have my sympathy.

I’ve bought one home in my life :)
Some day I may sell it and buy another for retirement, maybe. These costs, universally spread, all things equal, don’t change a thing for real people buying real “homes to live in” – a twice-in-a-lifetime expense.

Garth, if this stops people from buying, then they didn’t really need the home after all.

If a citizen doesn’t like paying their fair share to finally help the environment and economy, then they shouldn’t be buying and selling houses, they are just simply driving up the prices for everyone else.

O/T but far more pressing in a place like Calgary, is that my property taxes and my public utilities bill are getting ridiculously high. In fact, ever since the utilities went semi-private they have sky-rocketed.. the real problem is, and always will be, private unregulated greed. At least government costs are a community profit, whereas private costs go into some slime-wad’s greasy wallet.

#71 Live in Ontario on 05.15.09 at 2:41 pm

The only problem with people talking about moving out to Alberta is then you have to live with a bunch of Albertans. I’d pay twice the taxes I do now before I’d sink so low.

#72 ONTARIO IS TOAST on 05.15.09 at 2:46 pm

Would you believe that I moved here, in Ontario because the good ol’ “alberta Advantage” was dead?????

Man that McGuinty guy is nuts. he’s be known for centuries as the guy that killed Ontario. Literally.
As Dubya will be remembered as the worst Prez, McGuinty will have his dirty spot in history…

next elections in Ontario will be NDP for a long time…..
I’m just glad that my mayor isn’t that crackpot david Miller…

A 10 year old would know better.

#73 Dee on 05.15.09 at 2:53 pm

CalgaryRocks,

Perhaps you should stop the Conservative/Libertarian bullshit. With all the money expansion/printing done via tax cuts over the years and ‘massaging’ the numbers or books what has it gotten Canadians?

People want womb to tomb care but don’t want to pay for it. Politicians and economists know how much those tax cuts will Really cost in the long run and so will those under the age of 55. And if you’re over 55 you better hope you’re healthy and able to work.

I don’t mind paying my taxes but I care about people. All those who complain about paying taxes and demand tax cuts?

May you find what you’re looking for.

#74 Calgary37 on 05.15.09 at 3:40 pm

UPDATE: North American Union

Here are a couple of recent articles that may be of interest to you.

http://www.blacklistednews.com/news-4226-0-9-9–.html
The SPP: Three’s Company or Three’s a Crowd?

http://www.blacklistednews.com/news-4224-0-9-9–.html
Former president of Mexico calls for a North American Union at underreported summit

Note that David Emerson has been acting as a champion of Deeper Integration of Canada into the USA. Here is another article about him:
http://www.vancouversun.com/story_print.html?id=1571809&sponsor=
Emerson goes against the tide in push for border reforms
by Barbara Yaffe

One quick way to implement the NAU is if the American Financial System collapses and is followed by a flu pandemic. This means that paper and coin currency would be prohibited from use. This would allow the Amero and a Cashless Digital Currency System to be implemented. While TPTB are giving you your flu shots, they could also insert a microchip implant in the back of your hand to use in this Digital Currency System, or they could give everyone a prepaid Debit Card for you to use until they can set up a more permanent system.

A lot of bad things can still happen in 2009, and most people do not have a clue what is coming at them.

Stay safe.

P.S. The 2009 Bilderberg Group meeting is being held in Greece this weekend.

Power to the People. Let the Revolution Begin.

#75 Bill-Muskoka (NAM) on 05.15.09 at 3:46 pm

#70 Barb the proof reader

LMAO! Barb, that place would destroy property values inany neighborhood except Willy Wonka’s or VR’s make believe Drug Addicted Boomers! ;-) Thank Gawd you are not in my neghborhood. (Just kidding). I always wondered what people on LSD (or is that LDS?) see?

#76 Bill-Muskoka (NAM) on 05.15.09 at 3:49 pm

Meant for you #73 Dee

The Conswervatives want the same thing as everyone else, they just want the ‘others’ to pay for their share.

#77 Dan in Victoria on 05.15.09 at 4:06 pm

I got the wife to read about all those extra fees and taxes.She basically said”You know,people who scrimped and saved, did without and managed to save up for a down payment are having it stolen from them.”

#78 rory on 05.15.09 at 4:08 pm

#73 Dee you said:
“I don’t mind paying my taxes but I care about people. All those who complain about paying taxes and demand tax cuts? May you find what you’re looking for.”

No one minds paying taxes for value received. Right now the perceived value is not there. if you have an income reduction what to you do …spend less, right. If you earn more you may spend more or save more.

Problem is when times are good for gov’ts they spend more, hire more, pay more, shine up the pension plans more …you get the picture…always more.

Now that times are tough, the gov’t so instead of cutting back they just increase taxes (notice no increase in services for the sheeple, gov’t needs the new cash just to try and stay even – no value here).

It is not a 2 way street. The problem with gov’t is that they and the employees just take …because they can and public employees vote and threaten strikes…and they are the government …that Dee is why we need to speak up and do not go quietly …Go CalgaryRocks (whatever you said)…IMO.

#79 jess on 05.15.09 at 4:15 pm

“placement agents” isn’t the english language clever.

#80 Sun Yat-sen suit on 05.15.09 at 4:22 pm

Say Garth enjoy mouthfuls of Halton Regional blackfly on the bike this weekend. Very nutritious you know..

Bugmunch. — Garth

#81 Live Within Your Means on 05.15.09 at 4:22 pm

OT – I just loved Bruce Mackinnon’s ‘toon today.

http://thechronicleherald.ca/toon.php

Barb the Proofreader – Agree & got a good laugh out of the photo of your home :-) I had to show it to my DH.

#82 Not a home owner on 05.15.09 at 5:50 pm

#77 – I couldn’t agree more with your wife.

These extra costs are totally depressing to those who have sacrificed to save for their down payment. My husband and I have been saving for over 5 years and had decided we would start looking seriously this fall. Now, we’re not so sure anymore. We had to go against all those who told us that we HAD to buy a house, that we were crazy to stay with the ‘rents. And for what? It looks like we’re screwed in the end anyhow. That’s how responsible savers are rewarded. Meanwhile, those who can rack up credit and debt can pretty much have whatever they like.

#83 somecatchphrase on 05.15.09 at 6:01 pm

Scariest thing I’ve read or seen thus far:

http://www.chartoftheday.com/20090515.htm?T

Wow!

#84 Nostradamus jr. on 05.15.09 at 6:11 pm

…Sorry to break the horrible news for Ontario.

The news will not be good for Real Estate values in Toronto.

…Within six months there will be rioting, looting, street crimes, private property crimes, gang wars, serial killing, police fraud, there will be major shortages of food basics, gasoline, and supplies.

The Ontario Provincial Govt. will continue to raise taxes.

…I actually predicted this nearly 500 years ago…

#85 Grumpydawgs on 05.15.09 at 6:17 pm

Any kind souls out there who want to bail this fool out?

http://vancouver.en.craigslist.ca/reo/1172253038.html

PS : This example is not advice to follow on how to ‘invest’ in real estate in a down market :)

#86 CalgaryRocks on 05.15.09 at 6:47 pm

#73 Dee on 05.15.09 at 2:53 pm CalgaryRocks,

People want womb to tomb care but don’t want to pay for it. Politicians and economists know how much those tax cuts will Really cost in the long run and so will those under the age of 55. And if you’re over 55 you better hope you’re healthy and able to work.

Gee Dee, I think you’re the one that wants womb to tomb care, I certainly asked for no such thing.

BTW, why so upset? I just asked what you had extra to contribute to Dalton’s fund. That’s it. I guess it hits a little close when it is question of you paying and not ‘them’.

I don’t mind paying my taxes but I care about people. All those who complain about paying taxes and demand tax cuts?

May you find what you’re looking for.

You go ahead and pay for Dalton’s union friends to retire at 55 after working their 37.5 hour weeks (not including smoking time) and their 8 week/year vacations.

Make sure you smile real big and tell them how you love and care for them, when you greet them at the Wal-Mart where you’ll be working your retirement years.

Maybe they’ll send you a card in the winter from Florida to thank you for paying their pensions with your taxes.

#87 . . . fried eggs and spam . . . on 05.15.09 at 6:50 pm

#74 Calgary37 at 3:40 pm — “One quick way to implement the NAU (and SPP) is if the American Financial System collapses (DELIBERATELY) and is followed by a (HOAX) flu pandemic. This means that paper and coin currency would be prohibited from use. This would allow the Amero and a Cashless Digital Currency System to be implemented. . . .”

It will also allow govts. of various countries, under the guise of a ‘national emergency’ — Canada and the US among them — to re-institute a draft, or bring in a new one.

Unemployment is high and getting higher, so why not have these people do something, fix our countries’ infrastructure only to blow it all up again?

Then govts. can use excuses like Iran / Iraq / Syria, etc. having WMD to have more and more wars. Keep Russia and China in mind as well!
——
The short- and long-term outlooks are not terrific! — http://tinyurl.com/p4obpn

US banks are getting naughty again! — http://tinyurl.com/p8glnj

“. . . On one hand, you have banks and Wall Street receiving massive bailouts from the U.S. Treasury and the Federal Reserve, bailouts of the magnitude that would gear up for a Great Depression and imply that the banking system of our country is insolvent. Then on the other hand, you have Wall Street and the crony banks trying to convince the public that this is a minor recession and all will be well in Q3 and Q4 of 2009.”

Remember the second-half of ’09, as that is when things slide downhill quickly.

LA is also having its own fiscal fiasco. — http://tinyurl.com/oevyll
——
Bill-Muskoka (NAM) — Do you recall cyber-chatting about forthcoming Pole shifts? Well, we may not be that far off the mark — lookkeee here! — http://tinyurl.com/qxan3z — and this link hypothecates why the preceding may not be such a bad thing after all! – http://tinyurl.com/o4zjfx

#88 CalgaryRocks on 05.15.09 at 6:52 pm

#71 Live in Ontario on 05.15.09 at 2:41 pm The only problem with people talking about moving out to Alberta is then you have to live with a bunch of Albertans. I’d pay twice the taxes I do now before I’d sink so low.

Oh no! We’ll miss you. :(

#89 Dan in Victoria on 05.15.09 at 7:53 pm

Post#82 Not a home owner,I think that all governments are robbing the taxpayers with these types of fees.I guess the Ontario government just looked south of the border and watched what was going on with the looting of the US treasury and the lack of response from the american taxpayer, based on that decided to be a little bolder.May I suggest a good read for you,May 14’s http://theautomaticearth.blogspot.com/ also on his links read Patrick Killena.I wish you well,this mess will eventually cycle itself out.The idiots will pay.

#90 Bottoms_Up on 05.15.09 at 8:19 pm

Contact an MPP:

http://www.ontla.on.ca/web/go2.jsp?Page=/getting-involved/contact_an_mpp_legislator&menuItem=getting_involved_contact&locale=en

#91 gold bugger on 05.15.09 at 8:34 pm

North Korea Citizen’s Analyst writes: “I have no problem with all these extra fees for people who buy and sell houses, in fact I applaud them.” Fellow travellers Bill from Muskoka and Barb the Proofreader also chime in with their statist bona fides, but I’ve picked on them enough in the past.

Squibbly writes: “the high cost of completing real estate transactions will curb speculation and prevent realtors from doing phony paper sales amongst each other to juice the stats.”

Not sure who’s kookier. Marxists or conspiracy theorists.

“Speculation” is not an objective judgement. It’s a subjective term employed by Marxists who want the world to conform to their utilitarian creed. Just admit that you’re either afraid of a free market or unwilling to submit yourselves to the rigours of it. That’s OK. Admitting you have a problem is the first step on the road to recovery.

As for suggesting realtors engage in the (very expensive) process of buying and selling houses to each other in order to engage in a grand scheme of juicing MLS stats, well, somebody’s off his meds. Same guy claimed on another site that EVERY mortgage in the U.S. will fail. Stick to plumbing, pal.

And if any of you don’t want to live in Alberta, that’s OK. Really. Stay home. With all your spare time, you can check out the dictionary for the word, “irony.” As in, it’s ironic that smug Ontariorians would accuse ALL Albertans of being close-minded. Think it through, McGuintyers, you’ll get it eventually.

#92 M R Ducks on 05.15.09 at 8:35 pm

Howard Davidowitz delivers.. New York Style

gotta love this guy!

http://tinyurl.com/pf242w

#93 Devil's Advocate on 05.15.09 at 9:17 pm

“FSBOs almost always net the buyer less, not more. Without the muscle of MLS, the exposure of your property is minimal. This is usually a bad decision, made by the inexperienced. Hate them if you want, but realtors have a marketing net second to none. — Garth”

Actually a comprehensive study was done in 2007 that indicated FSBO’s generated more money for the sellers than a MLS sale. However it generally took much longer to sell a FSBO property. A link to the study can be found here:

http://faculty.wcas.northwestern.edu/~ane686/research/fsbo.pdf

This is not Wisconsin. — Garth

And, if true, which in my experience I doubt, all the more reason that a BUYER should employ the services of a good REALTOR.

And, how many FSBOs get multiple offers which circumstantially lead to higher than list price sales?

And, months of selling privately rushing home to meet unqualified buyers… what’s that worth?

And, well I could go on and on but the fact of the matter is 75% of FSBOs end up listing with a REALTOR. but you go ahead and wing it on your own. You learn best by repeating the mistakes of others until you learn that it is best to learn from the mistakes of others… it ultimately is less costly.

#94 POL-CAN on 05.15.09 at 9:37 pm

This was posted on Mish’s site earlier this evening:

Dow Jones, down 0.75%
S&P 500 down 1.1%
Nasdaq down 0.5%
US industrial production, April, down 0.5%
US inflation, year to April, minus 0.7%
Europe 1st quarter GDP, down 2.5%
German 1st quarter GDP, down 3.8%
Hong Kong 1st quarter GDP, down 4.3%

As you can see, there was a bit of a data blast last night. No bellbirds or green shoots I’m afraid – just unremitting gloom. In Europe the recession is just awful, especially Germany’s. And Slovakia’s and Latvia’s GDP are down 11 per cent, just in the March quarter!

Europe, by the way, doesn’t report “annual rate” GDP data like the US. So whereas the US economic growth number of minus 6.1 per cent for the March quarter that we got at the end of April was the “annual rate” of decline, the European figures refer to the actual decline in one quarter. The annual rate of decline in Europe is not given, but 2.5 times 4 quarters equals 10.

That’s a Depression. Germany is definitely in depression (-3.8%), likewise Spain, (-2.9% in the quarter), Latvia (-11.2%), Slovakia (-11.2%) , Lithuania (-9.5%), Estonia (-6.5%), Netherlands (-2.8%), and Austria (-2.8%). These are quarter on quarter figures remember.

But it is different here in Canada right? We are safe from a GLOBAL crisis right? Toronto is the ceter of the universe right? We are the only country in the world with an abundance of natural resources right?

Sheep… Sheep I tell you….

#95 PropertyGuy on 05.15.09 at 10:00 pm

“FSBOs almost always net the buyer less, not more.”

Garth – really – the internet has changed many busineses and has garnered you a loyal following here. It has changed the Real Estate business too. Use a professional marketing service, get some support and a good lawyer and you will net more.

I agree – If you go to Canadian Tire and pay $10 for a sign and hope for someone to drive by, your chances of selling are limited. But take good photos and expose it online on a site that gets traffic and have it priced right, and you will save thousands.

Sure, this is not Wisconsin, but the same holds true in any market when you combine Price, Product and Exposure online.

More Porn from the pimps today:

http://www.cbc.ca/money/story/2009/05/14/crea-april-sales.html

Yeah, I know you are in the business of making money from FSBOs. But try offering us all some proof. That would be more convincing. — Garth

#96 PropertyGuy on 05.15.09 at 10:21 pm

Should have added this to my previous post – The pimps are working hard – homes are SO Cheap right now, here is what you are being fed to sign on the dotted line:

http://www.remonline.com/detail.aspx?menu=29&dt=1405012&app=163&cat1=501&tp=19&lk=no

Hurry up.. there is someone sitting outside waiting to offer more on that cheap house.

#97 kanata squirrel on 05.15.09 at 10:30 pm

Let the Canadian arms of the car companies go under. Then some really smart, rich, green folks buy the facilities, re-hire the assemblers and modify the solution to be green cars built in Canada and screw Alberta in the process.

Duh?

#98 dd on 05.15.09 at 10:33 pm

#84 Nostradamus jr.

…Within six months there will be rioting, looting, street crimes, private property crimes, gang wars, serial killing, police fraud, there will be major shortages of food basics, gasoline, and supplies….

and Vancouver will be a bed of roses.

#99 Barb the proof reader on 05.16.09 at 12:09 am

#75 Bill “LMAO!”

Glad u enjoyed the photo of my home .. a happy place, in both an LSD or LDS kinda way :)

. . . . . . .

#81 Live Within Your Means “I had to show it to my DH.”

Hey L.W.Y.M.s,

Glad you enjoyed it too. Say hi to hub for me. Loved the Bruce Mackinnon you posted as well. So true. Can you believe that stupid party, so predictably starting negative attack ads. Gosh I so hope this time their hijinks backfires on them, it would be so satisfying to see the door slam on Harper’s ass.

I will now shut off the lights in my little pink & purple home of love, and go to sleep on my gum drop pillows :)

#100 Dave99 on 05.16.09 at 12:17 am

Nostradamus jr,

Would you please piss off? Seriously.

Although there are some loonies on this site, there are also some really smart people making valuable contributions.

But then there is you, who seems to delight in wasting everyone’s time with some puerile attempts at humour or perhaps some bizarre attempt at civic pride?

I’m guessing everyone else does the same thing as me when they see your post. They sigh and scroll to the next one.

You’re not funny.
You’re wasting everyones time.
Get a life.
Please.

#101 . . . fried eggs and spam . . . on 05.16.09 at 12:50 am

#94 POL-CAN at 9:37 pm — There are two countries, Norway and Ghana (I think) who are doing relatively well.

Norway is as close to debt-free as possible, while Ghana still has some to pay off. Overall, both countries seem to have happy and full workforces.
——
This country is undoubtedly in the same basket, but where, oh WHERE is the m$m to report on this? Ummm, they’ve all gone to hell in a trashcan! — http://tinyurl.com/qgy9ee

Compared with the above link and what Garth says about rising interest rates over the next few years, it is easy to see why The American Dream and The Canadian Shield are now lifeless! — http://tinyurl.com/o9gwal

Talking of protectionism, trade war vis-a-vis Canada / US. — http://tinyurl.com/qnwq7u — But this one is no trade war, it could lead to real war. Forewarned is forearmed. — http://tinyurl.com/pnw3dg

This is what I mentioned earlier. The US has zero chance of ever paying any debts off, so re-institute a draft (along with several other countries), create wars and rumors of wars.

Then two pole shifts, massive earthquakes, the underground super-volcano at Yellowstone blowing its’ top and by 2021, the population of the planet will be a couple of billion (give or take a few hundred million or so)!

More to the point, certain folks want inflation, so — http://tinyurl.com/ot9mp3

“1. Quite simply, today’s monetary and political framework is built for inflation, as much inflation as the government, the Federal Reserve and their banking partners want. And inflation, and a whole lot of it, is exactly what we are about to get.”

Home repos. in UK have gone up 50%. — http://tinyurl.com/pm49tn

#102 wjp on 05.16.09 at 7:38 am

# 91…”As in, it’s ironic that smug Ontariorians would accuse ALL Albertans of being close-minded. Think it through, McGuintyers, you’ll get it eventually.”

I might suggest only those that post here seem to carry that attribute…I will leave it to you to determine whether my comment refers to the “smug” or the “close-minded” … also I would suggest at this point in time you would find few McGuintyers in Ontario… as to what “Ontariorians” will get, my thought on that is they will get what all Canadians will get, ten long years of very slow recovery…

#103 Samantha on 05.16.09 at 10:12 am

The manufacturing sector in Ontario has been gutted and tax increases are a surprise? Someone has to pay and now to the tax-payers “it’s tag – you’re it”.

The time to bolster manufacturing and stop the off shore stampede was long ago. We reap what we sow. If the results aren’t acceptable, change. The inhabitants of the house on the hill will hear your voices if you use them – push for manufacturing, not service based jobs. Or, you can continue to complain about tax increases and change nothing.

Interesting that Ontario is levying these taxes rather than just slapping flippers with a licensing requirement. It could include insurance and ensure that those who have been gliding along on granite countertops and laminate floors would actually have to complete renos that are safe (wiring, mold etc…)

#104 Nostradamus jr. on 05.16.09 at 10:46 am

#100 Dave99

…I predicted “Intellectual and highly educated Oshawanians” like yourself, will have two choices, move away/start a new life or sink into the abyss amongst all your blue collar friends from across the Golden Horseshoe….unless of course you run for Politics.

Real estate was cool to own in Ontario, ….but THINK now…if Detroit, Cleveland, Buffalo, and Windsor are toast…why in the Wide World of Sports do you believe Toronto will be different?

Ontario can only maintain with the rest of Canada’s support…and that won’t happen much longer.

…Real Estate was Garth’s main theme for this blog site.
He has softened and replaced his views about Ontario utilizing the switcharoo to “Federal Canadian Politics”….why???…to take your mind of all the crap hitting the Ontario Fan.

Garth has decided to stick it out in Ontario…people make choices.

…And I predicted nearly 500 years ago that the Pacific Northwest will become the safest place in the world…

#105 John Feier on 05.16.09 at 11:17 am

At what point will people finally stop paying on their debt? The Titanic is sinking. We’re headed for a world where a credit rating is irrelevant. Don’t people see this? Think of all those things that you think you need credit for–a house, a car, a college education and luxury items at the shopping mall and ask yourself, is there any other way that you can get these items without credit?

A house could easily be replaced by a rented apartment or a mobile home that you could save money for. They could say that people who don’t pay their bills on time would find it hard to find an apartment. So, we’re just going to have people who have money to pay for rent and are working just live out on the street because they didn’t pay their light bill five years ago? Right.

What’s wrong with moving closer to work, walking, a bicycle or public transportation?

I happen to think that I shouldn’t have to pay for a college education. I think that should be paid for with tax dollars.

And do you REALLY need to buy luxury items at the shopping mall?

So you see….we don’t need credit to survive. All of this credit was introduced into the economy as a means to help facilitate globalization. The long credit-fueled consumer binge in the United States has helped to give billions of jobs to third world countries, but it has also perpetuated the stagnant wages that has existed in the American economy since the 1970’s. We now have people in Walmart making low wages helping to sell items that are made by people…making low wages. You only get what you give. This is the future.

So consumers should stop worrying about the fine china. The Titanic is sinking and it’s only a matter of time before the rumors are confirmed. Consumers should stop trying to save their credit record because we’re headed for a world where a credit rating is irrelevant.

#106 charliegosurf on 05.16.09 at 11:29 am

A plan for economic recovery

International economics is a mystery to me, but the following approach to resolving the global economic slump strikes me as very promising:

It is August. In a small town on the South Coast of France, holiday season is in full swing, but it is the rainy season not much business is taking place. Everyone is heavily in debt. Luckily, a rich Russian tourist arrives in the foyer of the small local hotel. He asks for a room, puts a 100 Euro note on the reception counter, takes a key, and goes upstairs to inspect the room.

The hotel owner takes the banknote and rushes to his meat supplier, to whom he owes E100.

The butcher takes the money and races to his wholesale supplier to pay his debt.

The wholesaler rushes to the farmer to pay E100 for pigs he purchased some time ago.

The farmer triumphantly gives the E100 note to a local prostitute who gave him her services on credit.

The prostitute goes quickly to the hotel, as she owed the hotel for her hourly room use to entertain clients.

At that moment, the rich Russian comes back down to reception, informs the hotel owner that the proposed room is unsatisfactory, takes his E100 back, and departs.

There was no profit or income. But now no one has any debt and the residents of the small town look optimistically towards their future.

[Hat tip to Bob Goldfarb] and P.Foglia of Montreal LaPresse who got me the link to the monkeycage blog,

#107 vicguy on 05.16.09 at 11:58 am

#94 POL-CAN, can you please provide a link to the article referring to an 11.2% drop in 1Q 2009 GDP for Slovakia? My sources indicate a 5.4% drop.

#108 PropertyGuy on 05.16.09 at 12:15 pm

#95…Hard to provide too much truth that FSBOs net more without this sounding like a sales pitch Garth – but Cave Spot did so in #64. Real estate is the same in Wisconsin as it is in Halton, Guelph or Victoria BC. Buyers buy homes at the market value, no agent “Voodoo” changes this. Could the same be said for Stanford CT?

Stanford University had similar findings:

http://www.nber.org/papers/w13796

“We find no evidence that the use of a broker leads to higher average selling prices, or that it significantly alters average initial asking prices. However, those who use brokers sell their houses more quickly.”

For my example in our little world in Guelph, ON – countless clients who have been unable to sell with an agent have lowered the price a bit and sold privately using our network and exposure. In fact one just sold yesterday in Fergus.

On the flip side, not one has gone to an agent, increased the price by 5% and sold with the agent. If there was Voodoo involved, the agent would always take over the FSBO, put the price up and sell it – it doesn’t happen.

#109 Dave on 05.16.09 at 12:25 pm

The reason we are house crazy is because it’s the safest investment out there.Remember the Nasdaq? The tech bubble? Lotsa people lost their shirts on that one. Enron? Bre Ex and Nortel? CEO’s making 10 million a year and private jets and yachts?Bernie Madoff? Mortage backed securities and CDO’s ?Creative accounting? Even your own government lies, cheats and steals from you. Remember the income trusts? So what is left? Real estate. You gotta live somewhere so you may as well live in your safe investment . Nobody can steal it from you or cheat you out of it and you don’t have to pay some asshole 10 million a year to manage it for you. And you don’t have to pay capital gains. For the average person, what else is there?
—————————-

trace your steps back. All the markets you’ve mentioned had a herd that rationalized why those particular investments were different from the rest- you don’t need me to tell you this, I’m sure people have long memories.

More and more we’re seeing the fundamentals of purchasing a home at the prices we see as a ridiculous decision. Increasing prices, increasing property taxes, new taxation such as land transfer taxes, green audits, massive job losses. Just like any other market, the herd will only take so much. At some point they say “I can’t do this!”, and the collapse ensues.

#110 dbg on 05.16.09 at 1:07 pm

North Van Citizen jr Aka – cut and paste

“…And I predicted nearly 500 years ago that the Pacific Northwest will become the safest place in the world…”

Dog years I imagine……

#111 Barb the proof reader on 05.16.09 at 1:31 pm

#106 Sorry charlie, but according to your story, the hotel owner is still out 100 bucks.. the plan didn’t work :(
Wish it had… t’wer life that simple ..

#112 ally ally oxycontin free on 05.16.09 at 2:12 pm

Ricochet, Fat Boy, Get Shorty, Death Star …

http://www.truveo.com/documentary-Enron-The-Smartest-Guys-in-the-Room/id/4251426576

Ken Lay’s vouch-safe missus … ” My Kenny wouldn’t ” …( ? )

‘After Oregon Power Generation was absorbed, all the linemen were fully 401K invested as an opportunity for a money grab.’

#113 Gord In Vancouver on 05.16.09 at 2:32 pm

I’m all for free enterprise but see Ontario’s new land transfer tax as a blessing in disguise. Although this tax will increase the price of a home, it’ll reduce the number of homeowners who can barely afford mortgages at today’s rock bottom rates – fewer foreclosures in the future.

#114 Bill-Muskoka (NAM) on 05.16.09 at 4:56 pm

#106 charliegosurf

Great story and true as well, from the standpoint of how things work. A point most miss in how dependent we are on each others credibility.

#115 Bill-Muskoka (NAM) on 05.16.09 at 5:02 pm

#105 John Feier

As the saying goes ‘Globalization is where the poor of rich nations make the rich of poor nations richer and the poor of poor nations poorer.’ I strongly suggest you read John Ralston Saul’s book ‘The Collapse of Globalism and the Reinvention of The World’ for a detailed insight as to how the program has failed.

#116 Bill-Muskoka (NAM) on 05.16.09 at 5:06 pm

#105 John Feier

As to the Credit Rating Industry, it is so ripe for a Privacy Commission investigation it is beyond the pale. Why would a company allow access to a Canadian’s personal information to someone in India?

These whore houses were built with no respect whatsoever in mind for the public. The politicians played whore again to allow them. It is the result of our non-personal world of not actually knowing anyone.

#117 Bill-Muskoka (NAM) on 05.16.09 at 5:09 pm

…And I predicted nearly 500 years ago that the Pacific Northwest will become the safest place in the world…

We assume you mean after the Big Earthquake, Tsunami, or volcanic eruption happens. Got predictions for those? Ask the people in Alaska how safe they felt when the last Big One hit? You live on the edge of the Pacific Rim. Good luck with the lava in your overpriced living room, if you still have one!

#118 rory on 05.16.09 at 5:19 pm

#106 charliegosurf

Cute story but is the way the present sysem works albeit oversimplified.

So where did the Russian get his money? …from the Fed Reserve Bank ….problem is some of the fraudsters siphon off the money so the $100 eventually disappears…no problem just print a few more $$ so all are paid …now you know it is all built on nothing but faith, baby…IMO …please don’t tell gold bugger :).

#119 taxpayer like you on 05.16.09 at 5:25 pm

106 Charlie – well it looks like a great plan.

Essentially what the rich Russian did was loan his money. Isnt that what we mean by liquidity? Isnt that what the
BOC is trying to do?

Its funny how we all seem to get hot under the collar about it.

#120 im-poster on 05.16.09 at 5:48 pm

every one can chill house prices go up down…economies go up and down…your lifestyle will probably go up and down, boats go up and down too. Bought a house in calgary in 1981 for $115,000. Tried to sold it in 1985 for $65,000….wouldnt sell! Listed again in 1992 for $125,000, then sold it for $165,000 in 2003. I know it sold in 2008, sept for $335,000. what a world…..

#121 Barb the proof reader on 05.16.09 at 6:00 pm

#105 John Feier, I liked your comment. And I’d like to add that I certainly also agree that some basic higher education should be paid for.. students would strive harder with no excuses about money. And I believe everyone deserves a shot at our best basic education.
There would be a cut-off point where specialized areas of education which would lead to guaranteed high income jobs, those rare careers like doctors that would afford room for loan payback, would of course have some sort of shared tuition and loan system. And of course in the case of doctors, with education partially paid for by the Canadian system, their student loan repayments would be factored into whether they STAY in Canada. Graduates who leave Canada and go to the U.S.A. within a certain number of years of graduating would not be given any concessions or easement or reward. Those who serve in Canada for ten or twenty years would receive the incentive payment. Help ’em pay, but only if in Canada, eh.

#122 POL-CAN on 05.16.09 at 6:37 pm

#107 vicguy

Here you go:

http://www.spiegel.de/international/germany/0,1518,625045,00.html

#123 Dave on 05.16.09 at 6:53 pm

every one can chill house prices go up down…economies go up and down…your lifestyle will probably go up and down, boats go up and down too. Bought a house in calgary in 1981 for $115,000. Tried to sold it in 1985 for $65,000….wouldnt sell! Listed again in 1992 for $125,000, then sold it for $165,000 in 2003. I know it sold in 2008, sept for $335,000. what a world…..
———————————————-

the price of paper clips, toilet paper, socks, bubble gum and anything else you can think of has risen in price since 1981 (27 years ago). Inflation is a certainty in the long haul. I don’t get your point

#124 Charles T. on 05.16.09 at 7:15 pm

(# 107 vicguy)

You can find the reason for the discrepancy at the following link

http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-15052009-BP/EN/2-15052009-BP-EN.PDF

#125 . . . fried eggs and spam . . . on 05.16.09 at 9:24 pm

#117 Bill-Muskoka (NAM) at 5:09 pm — “. . . after the Big Earthquake, Tsunami, or volcanic eruption happens. . . .”

Which is why the Okanagan will be oceanfront property in less than a decade!

To remove all the drug czars, booze smugglers and other lynchpins, as well as very naughty people from here, Calif., Oregon, Washington St. and the lower mainland will be let go — i.e., downsized to nothingness.

Thereafter, Okanagan Lake will join with the Pacific Ocean giving us a great lifestyle. With no economy to speak of, I haven’t yet figured out how to make it work or keep it sustainable!
——
As mentioned earlier, I said that the latter part of ’09, along with The Cycle of Nines will be heading south, and picking up speed at the same time.

Should have stayed with June ’09! — http://tinyurl.com/per7p6
——
This blogger hits the head on the rusty nail with this! — http://tinyurl.com/pkntkj

“. . . and that’s a good thing because things won’t get better for the average Joe until corporate industrialists start to hurt.

“. . . that’s the beauty of the human economy. like it or not, those corporate parasites are tied to us workers by the umbilicus. If we have no jobs then we have no money to buy their shit.

“. . . and when we don’t buy shit, the price of shit drops, putting hundreds of greedy corporations out of business.

“Which is precisely what’s happening as the economy grinds to a halt.”
——
Death and Taxes = the only two fundamentals of life, as everything else is what we choose to make of it. Does anyone really LIKE paying taxes? Be honest, now.

Apparently, there are people who don’t mind one bit. North Americans may have differing views, however. — http://tinyurl.com/qwv7nh

“Americans get bombs.Americans get torture chambers. Americans get lies.”

Courtesy wrh.com. Due to our not-asked-for inclusion in AfPak, include Cdns. and Mexicans with Americans in this group, especially with the war-monger Cheney possibly running in 2012.

#126 Shawn on 05.16.09 at 10:29 pm

99% of the posters on this Board give the others a bad name. The 99% have no clue about economics and are groping in the dark always looking for someone to blame.

Speculators, the taxman, big business.

Me? I am working within our wonderful economy enjoying a good life and building up my investments.

Even if jobs are scarce, you need but one. The best workers always find a job.

Look at Garth he lost his Parliment job but as an energetic guy he keeps on making money.

This blog is making me rich! — Garth

#127 vicguy on 05.16.09 at 11:07 pm

#97 POL-CAN and #124 Charles T. for your educational posts, one keeps learning due to a valuable blog like this.

#128 vicguy on 05.16.09 at 11:10 pm

Sorry POL-CAN and Charles T., I ment to thank you, but I messed up the previous post.

#129 charliegosurf on 05.17.09 at 12:26 am

one hundred toughts!

or five, http://1.bp.blogspot.com/_HuMUMwIgbGU/R1BGHMnm5pI/AAAAAAAAABE/VDndHJD4FvQ/s1600-R/Russian+Nesting+Dolls.jpg

keep on riding

#130 Bill-Muskoka (NAM) on 05.17.09 at 9:52 am

#125 . . . fried eggs and spam

What will they do for an economy? Well, I suppose all the fishermen from the Maritimes will migrate there to operate fishing boats for the tourists? They will, of course, have to compete with all the Asians who are already there and skilled fishermen.

Phoeniz, AZ used to be an inland saltwater sea. Perhaps it will be again after the Big One, along with the Okaknagon Valley? They are similar but the climate is grossly different.

One thing is for sure Mother Nature could care less about the status quo, and all that fluffy stuff humans think is so important.

#131 Bill-Muskoka (NAM) on 05.17.09 at 9:56 am

#125 . . . fried eggs and spam

One more thought on the aftermath economy. Perhaps the event, is a huge tsunami forms, will wash the square kilometres of plastic to the area from the mid-Pacific. They can then build a recycling plant and compete with the Tar Sands as an energy source? Sure will clean up the Pacific Ocean after many years of illegal dumping by unscrupulous arseholes.

#132 Bill-Muskoka (NAM) on 05.17.09 at 9:57 am

This blog is making me rich! — Garth

Going to buy a car company are you? ;-)

#133 Gord In Vancouver on 05.17.09 at 12:44 pm

#126 Shawn

99% of the posters on this Board give the others a bad name. The 99% have no clue about economics and are groping in the dark always looking for someone to blame.

Speculators, the taxman, big business.
___________________________________________

I agree that the taxman and big business should not be blamed but don’t understand why you’re defending speculators.