BC (Before Crash)


Being unemployable, I wander the country a lot, riding from town to town stirring up base emotions. One observation: People in BC are nuts. At least the ones who think it’s normal to spend a million dollars on a house in a former lumber town. Or half that amount on a concrete box in the air over downtown Van. Or four times that sum on a moist Victoriana money pit in Victoria.

If you ever lack proof Canadians can out-bubble the Yanks, look west. In fact, when I gave a speech last autumn to a sea of US realtors in Nashville, I flashed a current Vancouver listing on the screen – a crappy clapboard bung on the market for $949,000 – and the crowd roared. And why not? The average home value in the US is under $150,000.

No doubt in my mind that BC real estate is sitting on a fault line and ready for the big one. When it takes 70% of disposable income for the average Vancouver family to carry the average home, you know delusion has replaced logic.

Here’s an example of what I mean – yet another ‘Hi Garth’ letter (I am currently being buried in these things). Check this out:

Hi Garth: I am new to your blog.  I was introduced to you a few months ago by a girlfriend and she dragged me to one of your seminars.  My girlfriend has been trying to convince me to sell for over a yr now and of course I should of listened to her.  I believed like a fool the market will hold out because of our amazing mountains here in BC and with the Olympics ins 2010.  She sold her investment in Kamloops at the right time.  Damn her!!!

I am a single mom with all my net worth in Real Estate.  I invested at the right time and used equity to buy property. I have a Duplex worth 655-700,000.  If I sold when my friend told me to it could of fetched me 800,00 to 850,000+++. Last Feb my neighbour sold one half for 455,000 with no renos done!!!  I bought the side by side duplex for 440,000 and it is currently generating 4,100 income. I have a 500,000  mortgage on it.  I also have a chalet rental generating 1600 income with a mortgage of 220,000. It is currently up for sale and I had to drop my price 4 times now from 320 to 289,000.  I could of had it sold but I had stupid tenants that just wouldn’t pay rent or leave.  Plus they were selling and growing on the property.  I had multiple offers but I could not garauntee the vacancy and plus the tenants would scream at the potential buyers to get of the f’n  property.  It was a nightmare.  The tenants from hell  are gone now but if I sold I would of used the proceeds to invest in oil after reading your blog.  I know I need to diversify my portfolio.

I am 40 yrs old , I have 2 kids, and  have no cash besides the paper money.  I have no RRSP’s nothing but land. After reading more and more of your blogs everyday.  I want to sell everything even my new house that I am living in and just rent for $1400.00 and live a simple life.

What do you think I should do Garth?  Cash it all out and invest it in energy or just sit tight for 5 yrs hoping the market will turn around.  I know I don’t want to be a landlord much longer.  Fed up with tenants.

Single mom looking for the right direction.

Well, SMLFTRD, sounds like you have $1.3 million in real estate, over $700,000 in debt and an income stream of $5,700 a month. That translates into a net worth of $600,000 and an annual rental income of  more than $68,000.

So, what kind of single mom are you? Sheesh.

In any case, sounds like you are finished being a landlord, and afraid real estate values in BC will tumble, wiping out the equity you’ve built. Both are completely understandable. In fact, I can see ‘demand’ west coast real estate falling sharply within the next couple of years, once that Olympic nonsense is over and done with and the bills are pouring in. At that time, interest rates will be substantially higher, the logging industry will still be a mess and the river of Asian money flowing into the province will be turning into a creek.

After all, the economic centre of the world was already shifting from America to China even before subprimes, Wall Street greed, collateralized debt obligations and $10 trillion in borrowed bailout money. Now there’s no doubt. The US middle class is shrinking as fast as the Chinese one is swelling.

So, this would be a good time to sell, before rising mortgage rates make BC real estate even less affordable. Park your cash in financial assets and buy back in five years from now from sellers desperate to get their hands on remaining equity. Boomers will be especially tasty prey for property vultures, since they’ve pretty much skewered their own retirement by being house-rich and cash-poor. At the end of that day, of course, cash is king. You can’t sell off a bedroom to buy gas and groceries.

As for being a landlord, that totally sucks. Provincial laws have been rewritten in favour of tenants, to the extent you can’t just toss out someone who refuses to pay rent. Properties can be trashed, without any recourse for the owner and you’ve already experienced what a loser occupant can do to screw you out of a sale.

So, Single Millionaire Mountain Mom, good choice to bail.

You can also send along a photo and email address for the pathetic home-lusting malcontents who scurry in the dank corners of this blog. They already love you.


#1 Naramata on 06.18.09 at 11:54 pm

Garth…you are toooo funny! Thanks for the laugh!

#2 EJ on 06.18.09 at 11:55 pm

Just for laughs, I checked out the Vancouver MLS. Obviously the first thing to notice is the comical prices. However, the second is the size of these houses. 5, 6, 7, and even 8 bedrooms seems quite common. Places with 7 bedrooms and 7 bathrooms? That’s not a house, that’s a motel.

Are these all multi-family dwellings, or does the insanity in BC rot deeper into the brain than previously indicated?

#3 Basil Fawlty on 06.19.09 at 12:00 am

“After all, the economic centre of the world was already shifting from America to China even before subprimes, Wall Street greed…”. That is a very good point, investors will go where they can make money. One thing BC really has going for it is water, although much of it is being sold off to private power entities, I mean leased off, or some nefarious method steeped in neo-con mystery .

#4 taxpayer like you on 06.19.09 at 12:11 am

“sounds like you have $1.3 million in real estate”

I see a dup at approx $675K and a chalet at
maybe $290K. Thats about $965K, with $720K debt.
Amazingly enough the rent is 15 X. Glad I dont rent either.

“So, Single Millionaire Mountain Mom, good choice to bail”

Still the best option, and do it quick.

#5 flipper on 06.19.09 at 12:17 am

okay… I’ll bite:

SMLFTRD, please send a picture back to Garth and he will forward it back to me.
Together (once you ve liquidated) we can buy a small island and live happily ever after.

P.S. I am a great cook, I do laundry and most importantly put the lid down before I go.

Love forever

#6 glenn on 06.19.09 at 12:19 am

I friend used to own some rental properties a few years back. He one of those tenants from hell and could not legally get rid of them.

He came up with a simple solution which was legal because it was summer time.

He removed all windows and doors. The tenants left on their own fairly quickly.

#7 Fritz on 06.19.09 at 12:40 am

Hi Garth: People in B.C. are nuts? You just found that out?

#8 Charles T. on 06.19.09 at 12:42 am

Bull Markets Bullsh*t & Bubbles

#9 nonplused on 06.19.09 at 12:53 am


I wish my ex were half as business minded as you. And if I were still single I’d try to date you!

Hats off that you are thinking your position through.

I’d unload some of your properties (“hit the bid!”) but I don’t know if you need to go below Garth’s 40% rule.

#10 Jon B on 06.19.09 at 1:13 am

Sounds like someone who took the ill-fated advice of Ozzie Jurock. Yes, people here in BC are nuts.

#11 . . . fried eggs and spam . . . on 06.19.09 at 1:18 am

Jes’ come right on over and you will be turned into suitable employment material, placed here in the sunny and luscious Okanagan Valley Of The Titans, Garth.

Flash your thighs to the right people and you too can make a great living working at La hairy The Happy Hooker’s Wonderland Of A Whorehouse In B.C.!
If this were I, sell the lot and pay all debts off forever, rent a townhome or large condo, park the stash in agricultural commodities (we’ve all gotta eat), medical / health funds, bank preferreds, utilities, 20% silver coins and 5% one or two oz. gold coins. Sitting pretty!

It’s great to dream these scenarios up!
War drills were planned in advance so that NORAD and others would conveniently be somewhere else, so as not to shoot the planes down on 9-11. — http://tinyurl.com/6j88g

This exercise runs from June 18 – 24/09 (right now), so there may be something on the radar just following. — http://tinyurl.com/n454hl

“There are 3 major points . . . 1) Means – Dick Cheney and the Secret Service . . . 2) Motive – Peak Oil (Halliburton?) . . . 3) Opportunity – 9/11 War Games
This is why the tightly-controlled western m$m eggheads so dislike the freedom of the ‘net — nothing can be censored.

The second link is interesting as Kissinger has already called for a New World Order, the same as the Brazilian president. — http://tinyurl.com/kl3bjwhttp://tinyurl.com/mmma6o

“The incumbent nationalist-populist President Mahmoud Ahmadinejad (MA) received 63.3% of the vote (or 24.5 million votes), while the leading Western-backed liberal opposition candidate Hossein Mousavi (HM) received 34.2% or (3.2 million votes). Iran’s presidential election drew a record turnout of more than 80% of the electorate, including an unprecedented overseas vote of 234,812, in which HM won 111,792 to MA’s 78,300. . . .”

Note the term “Western-backed”, which is why Kissinger is calling for “regime change”; dubya also said similar things about Sadaam.

America is the ONLY nation which has ever used WMD against another. Remember Hiroshima and Nagasaki?

May also be a prelude to an eventual showdown with Russia and China. After the Aryan (white) race finishes their cycle, the red race (Chinese) takes over.

By that time, most of us will have already been euthanized to death, so it won’t make one iota of difference!
The other stuff (economy) re: China has America’s nuts in a vice and is tightening it. — http://tinyurl.com/kmbbxa

#12 Munch on 06.19.09 at 1:40 am

Hi Garth :o)

I am a single guy looking for a single gal with lots of bucks, cozz I want to emigrate from South Africa to Canada and live a lazy and contented life.

I am 6 feet 8 inches tall and healthy.

Please spread the word.

Munch the Malcontent

#13 TheFirstRick on 06.19.09 at 1:56 am

There seems to be little discourse on the topic of BC’s organized crime and drug industry and how these factors “artificially” fuel real estate prices in this province. In my opinion these are hugh mitigating factors in the disproportionately insane real estate prices in British Columbia, specifically in the Lower Mainland. (Vancouver area)

The government knows it, the real estate industry knows it and Joe Average knows it. I personally know professional people with relatively small grows that generate 10’s of thousands a year in tax free income. People you would never suspect in a million years. Do you want to work here? live here? even survive here? then keep your head down and shut up, crimestoppers is a sham, trust me.

If this is what it takes to own a home in BC, we have obviously gone off the rails. The marijuana industy alone is pegged at 6 billion a year. In a province with 3.6 million people? What has this done to the price of real estate? What is a better way to launder money than a subsidized mortgage payment? The “invisible tenant” as I’ve heard it referred to. People who qualify for a mortgage but can only support same by participating in this industry? One can only estimate what the true numbers are. I suggest it is not the wayward few, but rather 100’s of thousands of households participating. The result? 800K for a peice of crap in Burnaby.

What’s needed is a federal investigation and legislation to “clean up” this scurrilous, counter productive, dangerous and self serving underground economy. The damage that is being done to honest working people and families is incalculable. Unfortunately, those in the know and having the power to effect meaningful change have a vested interest in maintaining the status quo. Just ask the premier and even attempt a straight answer. No regionalized police force in The Lower Mainland and a politically motivated RCMP doesn’t help matters either. Law enforcement has become secondary to politics and an extreemly flakey court system that victimizes everyone except the true victim. Social engineering from the 70’s onward coming to fruition.

Was it not The Economist magazine that just called BC “The Columbia of the North.”??? It all starts at the top. God help us.

Ramble over, thank you.

#14 Jan on 06.19.09 at 2:27 am

Enough with insulting B.C.’ers Garth. And the fake letters are getting to be a bit much.

Sadly, every letter is authentic. And BC is nuts. — Garth

#15 Nostradamus jr. on 06.19.09 at 4:13 am


to this point ou have been spot on w/ regards to………

It is not the golden fleece.

I thank you for illuminating the pack.

Your current blog is convoluted and full of holes.

She spent $440K to buy two semi’s or one duplex
Was worth $800K+- but now worth $650K – $700K
Now has a $500K mortgage.
So each semi or half duplex has a $250K mtge.

2 Questions….Where is the property and what is the living space sq ftge?

The chalet is like apples and oranges to your description.
It has like 50%+- equity.

Same 2 Questions apply.

Until we receive the required facts, your readers letter is useless to this blog.

As the BC Oracle on this blog I have previously annotated that all Canadian Hinterland Towns and Villages are poor real estate investments.

…Save for Toronto and Vancouver.

and Toronto will not keep that position for too long.

Certain regions of Vancouver Island have always been popular Retirement havens…because of their mildest Canadian weather…and that’s all they will really stay as.

It’s like a major reset is in place all across Canada…except for…….drum roll please…….Vancouver…the next financial, trade, cultural and leisure capital of North America.

…Garth, why is it you never graph out real estate prices of Hong Kong, Tokyo, Singapore or Seoul?

Hongcouver is dirt cheap when compared to them….arent’ they.

#16 Sean in E-Town on 06.19.09 at 4:33 am

You should live in Alberta where our shitty landlords feel free to not honour a lease (rhymes with Peter Lam) that contracts them to fix a window and a veneer wall.

#17 crs on 06.19.09 at 4:52 am

I have to disagree about the tenants rights in BC. They are clearly in favor of the owner, but hopefully that will change soon. The law has been changed recently so that a landlord can get an order of possession after 9 days, without the need for a hearing, and can then hire a bailiff to remove the tenant and their possessions. I can only think that SMLFTRD’s claims are a little exaggerated. Perhaps the tenants were chronically late with payments… there are actually provisions for that as well.


#18 Darryl on 06.19.09 at 6:12 am

“You can also send along a photo and email address for the pathetic home-lusting malcontents who scurry in the dank corners of this blog. They already love you.”

No Thanks. She probably took her last husband or two for all they were worth. :)

#19 David Bakody on 06.19.09 at 6:26 am

Where do they come from? How many more are out there in Sunset Land Garth like this poor SMMM. Thousands?

#20 Toronto C9 Renter on 06.19.09 at 7:18 am

“…No doubt in my mind that BC real estate is sitting on a fault line and ready for the big one….”

Agree. Another example is Big White near Kelowna. We usually do some skiing there every spring. While the mountain is gorgeous and the accomodations are excellent, the asking prices are out to lunch and everyone seems to know it but the sellers.

Seems like the whole mountain is for sale, but nothing is moving. Places are still for sale in 2009 that we first noticed in 2007. Only difference is that now the asking prices are lower, but still not low enough.

We’re curious to see how much worse things are when we arrive in Spring 2010!

#21 Bobby G on 06.19.09 at 7:18 am


140-170% debt to income

#22 DG on 06.19.09 at 7:53 am

Really, a grown woman who has acquired all of this property but is all-but illiterate? “Could of”, “garauntee”? These letters just don’t ring true any more.

I resist the temptation to correct some grammatical and spelling errors, since these letters are, in fact, completely real and genuine. Each one sheds some light on us all, don’t you think? — Garth

#23 peter wiener on 06.19.09 at 8:02 am

re #21 Bobby G

and don’t forget that Canadians;

1) make less income
2) pay more taxes
3) proportonately have less discretionary income
4) have a currency worth less than US

so that 140% is even conservative in real terms!

#24 ally ally oxycontin free on 06.19.09 at 8:09 am

Post-Mortem on more post-mortems, where ‘greed, avarice and corruption,’ become the most sought after human trait. Refresh it for me, will you … How much was it that Madoff MAD[ E ]OFF with?


#25 dd on 06.19.09 at 8:32 am

#15 Nostradamus jr.,

This blog today is about overpriced Vancouver. POP goes the bubble.

#26 Nostradamus jr. on 06.19.09 at 8:34 am

Do not apply for your old age pension…instead apply
as a refugee.

The federal government provides every single refugee with a monthly allowance of $1,890.00 and each can get an additional $580.00 in social assistance for a total of $2,470.00.

This compares very well to a single pensioner who, after contributing to the growth and development of Canada for 40 or 50 years, can only receive a monthly maximum of $1,012.00 in old age pension and Guaranteed Income Supplement.

If you had the wisdom to have an RRSP and made other
income generating investments you may have earned the right to receive nothing from the Federal Government as they will claw your Old Age Pension back because in their opinion you do not need it.

It pays to be as refugee.

Only a bigot and an idiot would make such a posting. There is no “$1,890 monthly allowance” and if you want to be a refugee, I’m sure many people on this blog would be happy to assist you. That was your last post, dude. — Garth

#27 The Dog on 06.19.09 at 8:45 am

A bit rightous DG! So in your tiny mind, you can’t be successful or worthy of aquiring wealth if your spelling isn’t up to par?
Or is it jealousy that a single mum has more net worth than yourself and your aging degree?

#28 Gord In Vancouver on 06.19.09 at 8:48 am

Excellent post, Garth.

Here in Vancouver, the “now is a great time to buy” mantra has spread from speculators to long time homeowners, who want high real estate prices when they become empty nesters or sell to generate retirement funds.

#29 Nostradamus jr. on 06.19.09 at 8:56 am

>>>Canadians’ household debt is about 140 per cent of disposable income, compared with about 150 per cent in Britain and almost 170 per cent in the United States. The level is about 90 per cent among the countries that use the euro.<<<

…So diluting their own currencies seems to be the only way to deal with the US’s, Canada’s and Britain’s Foreign Debt.


#30 Da HK Kid on 06.19.09 at 9:08 am

Garth, you rock bro! That dis to Nostra was overdue!

Btw, I rented places in Deep Cove and Whistler over a 3 week period in July. I had owners asking me if they should sell.

Occupancy has been slaughtered! I sent them to Garth, if they write a letter to him not related to selling ONLY, as mentioned, will ignore!

Oh yeah, 5500sqft 5 star right near the village asking $790/n, taking $325! The Deep Cove property not as good but down 50%.

Left coaster bubble centric RE DOLTS………GET A GRIP!

All others in good form, debt reducing renters, come up for a brown pop! I might spring for prime rib!

#31 Toronto C9 Renter on 06.19.09 at 9:15 am

#22 DG on grammer and spelling…

DG, this is just a reality of a fast, electronic information world. Its the message that should matter not the spelling. (unless its a CV!)

P.S. Senior execs, CEO’s are some of the worst offenders, when snding internal e-mails.

Welcome to the information age

#32 Bottoms_Up on 06.19.09 at 9:20 am

From link in #21 Bobby G:
“Canadians’ household debt is about 140 per cent of disposable income”

I watched till debt do us part the other night. A couple with a combined income of $51,000 had a child and lived in their parent’s basement. Their parent’s charged them $200/mo for food/rent/bills.

Here’s the catch: this couple had ~$70,000 student debts, and THE ONLY/BEST OPTION was cited as declaring bankruptcy. (turns out they couldn’t do this because the parents had co-signed on the student lines of credit).

Assuming their disposable income was ~$40,000, that means their debt-to-income ratio was 1.75:1 (or 175%).

With the average Canadian/family at 1.4:1, it’s getting awefully close to bankruptcy…and I bet many Canadians do NOT have monthly bills equalling $200…..

#33 Nostradamus jr. on 06.19.09 at 9:21 am

# 89 Pink Monkey on 06.17.09 at 10:45 pm Nostradamus Jr


# 45 mikewasanengineer on 06.17.09 at 12:52 pm Nostradamus jr.


“”Only a bigot and an idiot would make such a posting…Garth””


#34 Bottoms_Up on 06.19.09 at 9:22 am


Quebec providing $8000 for the purchase of an electric vehicle…

#35 popeye the sailor man on 06.19.09 at 9:28 am

#22 DG,

Just because someone can’t spell doesn’t mean they can’t acquire wealth, and hold a good job or invest. I’m suspected to be dyslexic and with hard work I was able get a technology diploma, and a 2nd class Motor and 4th Steam Marine Engineering certificate, I work as a Senior Engineer and sometimes as a Chief Engineer. I even have a 4th Power Engineering Certificate. I’m good at what I do, might not be the best, but being vigilant and taking extra time makes up. Having flipped a couple of homes and been a land lord a couple of times, I know being clever a good work ethic and being money smart can make up for lack of spelling.

PS spell checker found 11 spelling mistakes that are now corrected.

#36 Dean on 06.19.09 at 9:30 am

Saw one of those bidding wars at one of my neighborhood houses here in Edmonton the other day. Three realtors sitting in their SUV’s writing up offers. I haven’t seen that since 2007. The grapevine price I heard (which is fairly reliable) put it in the 2007 price range too.

Garth, what’s this bubble made of? Titanium? Anyway, the economy here still stinks, so it’s got to be interest rates fueling this one.

#37 popeye the sailor man on 06.19.09 at 9:32 am

#26 Nostradamus jr.

YaY Goodbye, I’m tired of his nonsense.

#38 905er & Spouse on 06.19.09 at 9:34 am

RE: #26 Nostradamus jr.

That was your last post, dude. — Garth


Everytime I ready one of this guys posts about half way through I start thinking “Who wrote this garbage?” Then I realize who it was and skip the rest angry at myself for wasting the time to read his post. Now I don’t have to worry about it anymore.

Until he changes his name again…

West Vancouver Citizen Jr –> Nostradaums Jr. –> ?

P.S. I guess he won’t be Garth’s Minister of Finance after all. lol

#39 Larry on 06.19.09 at 9:38 am

# 26 Nostradamus jr.
Actually refugee’s entering Canada must pay back the allowance they receive from the federal govt. Just ask any of them and they will clarify that for you.
How would you feel if you were evacuated from a war and had to adapt to a new country with no money to buy some bare essentials for your family. BTW Enjoy your ban you bigot.

#40 D - Ottawa on 06.19.09 at 9:38 am

#26, Nostradamus jr.

His comment isn’t even an original posting. This was cut and pasted from a chain letter. ‘Maybe’ the last line was original. Details of the false claim from Nostradamus jr. are found in the following link.


#41 househunter on 06.19.09 at 9:42 am

Garth, I’m a Vancouverite and I agree with you… sorta. Post 2010 there is going to be a juicy drop but I this area (i’m not talking Surrey, Maple Ridge, Coquitlam ect) is in high demand. I think there is going to be a fantastic buying opportunity when the prices in Vancouver proper drop another 10-15% ($100-200k). This area goes through peaks and troughs like everywhere, and post 2010 is likely going to be a trough.

#42 Waiting for it on 06.19.09 at 9:53 am

#26 Nostrastupid Jr

I have seen that SPAM email circulating before with the amounts you indicated for refugees.
It’s racist and full of mis-information.
But then – you probably believe those emails that you get saying if you forward to another 15 people you’ll magically get a $50 Gap gift certificate in the mail!?!

Government-sponsored refugees may be eligible for assistance under the RAP (Re-settlement Assistance Program) for up to one year. These are for the people that basically have been granted refugee status prior to even coming here.
After the one year they may be eligible for social assistance if they haven’t found employment within that time…
But both benefits are NOT available at the same time.

For people who arrive here and just suddenly make a refugee claim at their port of entry (or after they’ve arrived), they still have to go through a fairly lengthy process to determine if they will be granted status as a Convention Refugee.
They may be eligible to apply for OWA as well.

For anyone that thinks that people on assistance make a ton of money — just think of these numbers.
For a single person, the maximum that the government will assist you towards your rent is $356.
Try finding that rent in Toronto.
Add $216 for food and you’re living large!!

#43 Mathew Gibson on 06.19.09 at 9:57 am


Thank you for finally axing Nostradamus Jr.

#44 Calgary Rip off on 06.19.09 at 10:00 am

Nice post Garth.

As an underpaid renter(9 years university and 3 degrees, including graduate school) I make $90,000 a year.

One of your readers assumed I drived ambulance and that was overpaid. That comment shows the ignorance and callousness of Alberta. Most people are UNDERPAID for what they do in Calgary. The reason it is hard to afford anything is the petroleum industry and the speculators.

However, to buy is a choice. The media and local attitude here think buying a house is like purchasing groceries. It is better to wait and think when buying a house.

By renting, if I so choose, I can leave Calgary at any time. I am smart enough to retrain in any field I choose. I also am able and willing to do any job. Ive done it when I immigrated from USA to Vancouver Island with my family.

Unlike my workmates who are serfs to their house, I am fortunately not tied to this overpriced prairie town of Calgary.

Some may argue that its much worse in Vancouver, that is true.

And you are correct in saying Canada real estate is a rip off. The same house in Katy Texas(outside of Houston) where it would be $500K here in Calgary would be $130K there at most. This is an alarm bell with anyone anywhere who has any intelligence.

Calgary real estate remains overvalued severely still.

#45 LS on 06.19.09 at 10:01 am

@Jan and DG
“Really, a grown woman who has acquired all of this property but is all-but illiterate? “Could of”, “garauntee”? These letters just don’t ring true any more.

Think about it, Garth has a highish profile blog which likely generates hundreds of emails a day seeking free advice. Do you really think he’s gonna spend a ton of time making up emails just to post them here? Don’t be daft. I’m sure it’s a veritable gold mine of stupid stories every day.

#46 Peter on 06.19.09 at 10:03 am

If I had any real estate in BC I would sell in a hurry. This will not simply end badly, this will be a disaster.

#47 Jonathan on 06.19.09 at 10:07 am

Hey Garth and posters,

I know commodities and I know energy. I don’t know health. Garth, or others, what type of companies do you invest in?

Concern is that the large pharmas like pfizer, novartis and merck are susceptible to losing their patents and drug discoveries are rare and expensive.

Also, US private hospitals may actually have to reduce prices if they end up competing with Obama’s public hospitals if they are ever built.

What else is there to invest in?

#48 RJ on 06.19.09 at 10:09 am

Sorry, I’ve got a kid.


#49 timbo on 06.19.09 at 10:12 am

Would it be possible for you to post on the tax implications of selling housing for a profit.

twice now I have heard about the massive tax free money people have made flipping 3-4 property’s in the same market over 2-3 years. Is this or is this not income and how long should you be waiting to sell to get below the tax-mans radar.

My friend is developing his basement and putting up a garage in the back yard. He bought last year and is developing to increase the price of the property as it has not sold yet. If he sells this fall and rents after, in the same area, will that not show he had profit in mind on his primary residence?

#50 PTDBD on 06.19.09 at 10:14 am

Would $8,000 help you with your house purchase? – That’s the tax credit Americans are getting.

Even better, there is now a Bill in the Senate to extend this to $15,000 and to make it eligible for a downpayment. Bill S 1230.

(the money comes from the amazing paper prestidigitizer perpetual prosperity machine – too bad Canada doesn’t haz one, eh?)

#51 Rodney on 06.19.09 at 10:23 am

I just finished with tennants.. 12000.00 damage after their lease was not renewed.. Went to rentalsman was awarded half the ammount as we did not have enough pics before tennants moved in…now collect.. You can-not get blood from a stone. You can register them with small claims court but if they leave the province you are screwed.They don’t work or have an address find them !!Don’t give me the crap in favour of the landlords…Happy in Kelowna !!

#52 Another Albertan on 06.19.09 at 10:26 am


According to a semi-retired realtor that plays bridge with my mom:

Edmonton is exhibiting a peculiar, but evident, trend in the past two months or so. There are bidding wars on some properties, but what caught this woman’s attention more than anything else is that the majority of transactions taking place are in what she calls “a very thin demographic slice”. My mother probed a bit further about this “slice”. It turns out that many of the recent Edmonton transaction are being done by “young people, in their 20s, a large proportion of which are having cash injections or co-signing by their Boomer parents”. She likened the situation to a “panicked feeding frenzy, probably fueled by a bit of the ‘last chance to get in’ mentality”.

Per usual, everyone else’s mileage may vary.

#53 rory on 06.19.09 at 10:29 am

All got to see this visualization on how hard The Yank gov’t is working to balance the budget to make all live within their means …this is a wow as in that’s it…yikes.


#54 rory on 06.19.09 at 10:35 am

I hit send before adding more …I think the actual cuts are up to about 17B now after everyone said it was not enough …their are other links from the one above that show that 17B is still a small #.

#55 PTDBD on 06.19.09 at 10:56 am

Would $3,500 or $4,500 help you with your new car purchase? The “Cash for Clunkers” Bill is awaiting Obama’s signature in America. In Germany they are getting $4000.

Canada, due to its “turning the corner” green vision offers….(drumroll)….$300.
;-) going forward :-)

(BTW, this money comes from the amazing paper prestidigitizer perpetual prosperity machine)

#56 pjwlk on 06.19.09 at 11:02 am

A couple of good articles for those interested.

– “China is frantically spending its dollar reserves to buy factories and property around the globe so it can unload its U.S. currency.”

– “The negative equity that already plagues 25 percent of American homes will expand to include nearly all property owners.”


Dismantling America’s Financial-Military Empire.


#57 evilfred on 06.19.09 at 11:23 am

if Garth was actually familiar with the Residential Tenancy Act in BC he would know that tenants have almost no writes. The letter writer also seems completely out of touch with the process.

Perhaps, but they do have rights. — Garth

#58 smw on 06.19.09 at 11:30 am

BC’s fate?

– Urban real estate in Japan has fallen for 15 years.

– Prices are now only back to 1986 levels.


No matter what the heavily medicated dogmatist from BC says, it won’t stop the inevitable.

During the tech boom colleagues in San Francisco and San Diego talking the same nonsense while their bungalows went for a cool half million.

7 years later the gig was up in the USA.

If you look at that chart, the small blue dip was 2002. It doesn’t happen over night and it could be 2015 before we hit the bottom in Canada.

But a lot of young professionals listening to the wrong advice are going to bleed $ for the next five years. And the BoC will not be able to hold back rates for 5 years for them to catch another “break” in the bank rate, like they did for the boomers on the down slope towards retirement.

I posted yesterday that in six months the long term bond in the USA is up 2%. If you don’t understand what that means, it means that in order for the USA to entice
buyers of their debt, they will have to pony up a better rate on their debt. Good thing they’re the “reserve” currency because the US as a nation has been SO RESPONSIBLE with that role.

Its not “if” real estate will come down in Canada, its a matter of “when”.

I hope these drop in the bank rate will save some of the boomers out there that took a hit in their pensions.

We’re not different, we’re no smarter then the Americans or the Japanese, we’re susceptible to greed and manias. The golden RE goose is dead.

#59 AM back in TO on 06.19.09 at 11:39 am

Only a bigot and an idiot would make such a posting. There is no “$1,890 monthly allowance” and if you want to be a refugee, I’m sure many people on this blog would be happy to assist you. That was your last post, dude. — Garth

I bet Jr. predicted this some 500 yrs ago…

#60 poor decision on 06.19.09 at 11:40 am

Wow, I see that I picked the wrong single mom from BC to marry. Damn.

#61 Nostradamus jr. on 06.19.09 at 11:40 am

>># 40 D – Ottawa on 06.19.09 at 9:38 am #26, Nostradamus jr.


#62 Nostradamus jr. on 06.19.09 at 11:44 am

the river of asian money flowing into the province will be turning into a creek ….

…what statistics have you to confirm this?

shifting from America to China…

Vancouver will remain Asia’s gateway/lead city….New York State and New York are next to implode.


#63 kc on 06.19.09 at 11:45 am

20 Toronto C9 Renter

“Agree. Another example is Big White near Kelowna. We usually do some skiing there every spring. While the mountain is gorgeous and the accomodations are excellent, the asking prices are out to lunch and everyone seems to know it but the sellers.”

You think Kelowna is bad….?? Do a mls search on Revelstoke BC, they built some new ski hill there and every property went 300% up in price. The real kicker thou is that the land assesmant for houses in the area fuel the misconceptions of what the real price should be. I know the area well and know a person there who owns a old house in the older section of town. He keeps on saying that if he put it on the market he can ask 1.3 M for it. Ask anything you want, it still takes an idiot to buy it, and if these are such great deals look at the pictures on MLS and see how many of these houses still have snow on them. This shows you how long they have been on the market. Realstate agents should actually do some work and update pics (i know it is such hard work selling houses that means you might have to retake pics) LOL

Anything West of Golden to Victoria is engulfed in a BUBBLE zone.


#64 rory on 06.19.09 at 11:49 am

Hi all …looking for a little advice. I have been liquidating like crazy …now got the ‘cash is king’ thing going …now what?

Where is everyone parking their cash? Are insured deposits safe? I am assuming money should be in short term whatever but is earning nil a good place for now.

My assumptions, right now, is RE has nowhere to go but down, all stocks going down (bear market rally right now?), rising interest rates will tank bonds, oil down on lower demand (short term) & even gold to $800 or so…so pretty much deflationary times.

Me, I have about 70% cash, 20% value mutual fund, and 10% precious metals, 0% RE….and I live in BC.

So where is the big, smart money parked and what it is doing? Comments?

#65 Kelly McMae on 06.19.09 at 11:53 am

People in BC are great, and much like Ontario we’ve got our various regions. From Lululemon latte totin’ gear heads in the lower mainland to grey haired gnome lovely gardeners the province over to lucky drinkin’ moose shootin’ voyagers to hemp wearin’ diesel turned oil van converts.

People in the lower mainland tend to be the most crazy, perhaps since most of the kids who grew up there, and for some reason want to stay there, can’t afford unless they tap the parent bank still sending them into 500K debt. Should they wish to move to the burbs though and sludge to work through hours of effluents the home abode purchase price decreases slightly, inversely in fact to your new social status.

#66 Al on 06.19.09 at 12:00 pm

Diversification as typically described in the MSM is for people that have no clue. Case in point. Go from all in one asset class ie real estate to another ie energy. Glad to see how that one works out for you. Deflation hits everything. Real estate and oil. See you at 15 bucks a barrel. Bye bye.

#67 smw on 06.19.09 at 12:01 pm

#39 Larry

And just to add, the PNP (Provincial Nominee Program) has become a “corrupt” cash cow for provinces. Basically using the paying, educated immigrants as tax grabs.

And when somebody that claims they’re so smart doesn’t know the difference between a refugee and an immigrant, just goes to show how much sense all other baloney coming out of their mouth for the past year makes.

Last year 2000 refugees came from Iraq, 25K died. If a few of my tax dollars can go to save an innocent life, and I don’t have to risk mine in the process, bring it on.

Then again, that’s what being CANADIAN is about. Follow the lead of our fore-fathers(aka WWI and WWII), be the bigger person, do whats right, protect the weak.

I hope your able to be blocked at the IP level.

#68 lemontory on 06.19.09 at 12:23 pm

Here in our Burnaby neighbourhood, everything in the $700-900K price range has sold quickly. Average houses – nothing special – could use a few upgrades to modernize them – no mortgage helpers – but flying off the shelves. Insanity rules.

A friend of mine looking to get into the RE market asked me the other day how can people afford these homes? The three typical answers you get is 1) wealthy Asians, 2) drug money (way more common than you think), 3) massive debt. My bets are on (3) – mortgaged to the hilt!

#69 infernalmachine on 06.19.09 at 12:27 pm

All right, I’m going to become a persistent nag.

Garth – WHAT ABOUT TORONTO? Bubble, yes. Bursting? Leslieville properties are only one example.

Look at this nonsense from June 13th Globe & Mail. It’s an 850 sq. ft 2 bedroom 1940s bungalow.

“185 Windermere Ave., Toronto

Asking price: $455,000

Selling price: $465,000

Previous selling price: $358,000 (2004)

Taxes: $2,773 (2009)

Lot size: 25 by 100 feet

Days on the market: one

Listing agent: Theodore Babiak, Royal LePage Real Estate Services Ltd.”

I am renting because I know this is ridiculous. But maybe we’ll go the way of NYC, Hong Kong, London, Paris, etc and fall right off the deep end of common sense into crazyland where bungalows are $950K and have knotty pine panelling and asbestos insulation.

#70 Nostradamus Jr.'s Analyst on 06.19.09 at 12:28 pm

Vancouverites are indeed insane when it comes to real estate – actually when it comes to pretty much anything.
What kind of people overpay by 100% for the biggest purchase of their lifetime, especially after witnessing what’s happened in the US (which is far from over by the way thanks to Alt-A and option ARMS coming due).
Our version the 0/40 will have it’s first wave of renewals next year.

We in La-la land are in for a rude awakening and I for one welcome an end to the stupidity.

Some points about our economy:

*Forestry – DEAD
*Tourism – dying, cancelled cruise ships and higher dollar + post Olympic layoffs of 10’s of thousands.
*Film industry – higher dollar again will snuff out business.
*Construction – already at 25% unemployment rate, Olympic mega projects due to complete in Sept.
*Finance – hammered

That leaves grow-ops to sustain us – why don’t we legalize marijuana and kill that off too.

As Steve McGarett like to say – Aloha, suckers!

P.S. – thanks for putting my patient in the corner with his dunce cap on, it’s what he needed.

#71 jose on 06.19.09 at 12:31 pm

Clearly, people in BC have lost touch with reality

#72 Nostradamus Jr.'s Analyst on 06.19.09 at 12:31 pm

And did I mention that Vancouver is tapped to become the next gangster/homeless/junkie capital of the world?

#73 Bill-Muskoka (NAM) on 06.19.09 at 12:47 pm


As to ‘BC is nuts!’ Yeah think? LOL BC = Bong Capitol it would seem?

#74 PTDBD on 06.19.09 at 12:56 pm

#34 Bottoms Up – your “Quebec providing $8000 for the purchase of an electric vehicle” is enticing. Do hybrid’s qualify?

Currently how many electric vehicles are available in Quebec for highway driving? Could a nearby provincial resident take advantage by buying their car there and diving it back?

Didn’t our enlightened Fed Govt. also have a green incentive program, or did they “turn the corner” on that one also?

As for the prestidigitizermoneyprinting…I used to be against this. But since the U.S. seems to taking the practice to its limit, Canada better join in. If you are in a poker game wqhere everyone else is using IOUs and matchsticks, you would be foolish putting real resources into the pot?

#75 David on 06.19.09 at 12:57 pm

Psychiatrists actually have a nomenclature that applies to this type of pathology. What comes to mind is Cognitive Disassociation, which is briefly defined as; “psychological conflict resulting from incongruous beliefs and attitudes held simultaneously”. If that is what Garth means by nuts, then it fits the clinical definition. The housing fault line on the Wet Coast looks set for a massive tectonic plate movement with hundreds of after shocks.
The disturbance is understandable, the belief that real estate prices never go down versus home prices totally disconnected from economic reality and fundamentals.

#76 Increasing that 1% on 06.19.09 at 12:58 pm

Why is there the assumption that because she’s a single mom, she’s looking, or interested? Or, that it’s such an unusual situation that she has any money or business sense (supposedly) ?

What does the term ‘single mom’ mean anymore, anyways? Used to be for the young teen moms who ‘accidentally’ got pregnant, ‘father’ not involved/ abandoned her and too young/unable to be ‘forced’ to help support child, family not supportive, and she has a lack of education/ resources available to her.

That is not the case anymore with many women who happen to be raising their children without their father…

#77 Nathan in Edmonton on 06.19.09 at 1:08 pm

#32 Bottoms Up
RE “Till Debt Do Us Part” — I find it funny that they rarely include mortgage debt, because we all know its “good debt”.

#78 Mike B formerly just Mike on 06.19.09 at 1:08 pm

Nostradamus jr.’s bigotry is the least of his worries.. He is arrogant and dumn as a post… all great combinations
In all fairness Vancouver is a great place but price point to buy or even rent is beyond crazy.. Years ago before I was married I went looking for work and the pay was at least 30% less than Toronto and the cost of living 25% higher so really that did not work for me. I know of a very wealthy couple who only had one child that they adopted. Even they bought way outside of the city in Coquitlam which I am told now is also quite expensive.
Not sure if I made the right choice as Toronto is tres expensive and now with the recession jobs are pretty scarce and low paying..

#79 crashing yuppy on 06.19.09 at 1:15 pm

Houses in the Greater Vancouver area will be down at least 30% from this moment one year from now.

Go to the bank on it. The post Olympic hangover combined with continued job losses will lead to a giant POP sometime in late Summer.

Please log this comment. I will be back in June 2010 to accept all laurels/criticism on this prediction.

#80 questioning on 06.19.09 at 1:35 pm

it is the Asia immigrants’ money supporting the RE market now…maybe forever.

#81 ralph on 06.19.09 at 1:45 pm

hasta la vista Nostradamus jr.

#82 barb the proof reader on 06.19.09 at 2:37 pm

I just hope you get this underway ASAP and put those places on the market this week. The process takes time, and now is the time to strike. I hope you keep us all informed on your progress, and when you reach freedom, please let us know. If you delay, you’ll miss this summer rush. August is too late.

#83 curious to know on 06.19.09 at 2:37 pm

Anybody knows where the Canmore market is at?

If you do, I would be glad to hear about it.

#84 Tom Jeffries on 06.19.09 at 3:13 pm

These monster homes in Vancouver are ridiculous. Most of older frontage is 35 feet on the West side, with 50 ft. being the usual high end.

These crass structures have come along at the same time that the mass hallucination of ‘real estate investing’ really took hold.

The insanity falls a well worn path, and can be passed off to the ‘get something for nothing’ gene that makes us bipeds so vulnerable to herding behavior.

No one seems to remember when Vancouver Real Estate TANKED in high interest rate, and stagnation cycles.

Lets think about this: Right now I bet a lot of people are holding off selling their palace, because of the Olympics. Put down the bong – the Olympics are NOT going to goose home prices in Vancouver.

Let’s think about this.

Interest rates have been on the floor but are moving steadily higher. The folks that have been using that HELOC for those trips to Hawaii, or worse, jacking a bunch of dough into overpriced condos at a skihill, are going to wake up all at once and go – SELL!
SO – a ton of homes will be fighting for few buyers. Will Boomers be willing to drop 500K into a 500 sq ft condo in Yaletown? Who will be buying?
Unemployment (*except in the Government and healthcare sector) is rising every month.

How many people in the IT, Software and Banking/Financial sector are going be cut?

The banks are cutting back on credit like crazy. HELOCS are demand loans and can be called at any time.
Credit cards have been maxed.

YOINK. There goes the party money.

Vancouver’s after tax income minus home costs rank us at #57, tied with Goose Bay Labrador.
Pass the Kraft Dinner.

Did your parents spend thirty grand for a granite counter top?

#85 Nostradamus jr. on 06.19.09 at 3:14 pm

>>Excluding (U.S.) public sector borrowing (by the Treasury, government agencies, states, and municipalities), private sector credit was reduced at a mindboggling


#86 landlord on 06.19.09 at 3:19 pm

my question to all those on the site that know which way the re markets are heading: how are you capitalizing on your knowledge… come on kids, time to get some skin in the game.

#87 Herb on 06.19.09 at 3:22 pm

Timbo @ 49,

“flipping 3-4 property’s in the same market over 2-3 years” is a sure way to attract the attention of the revenooers and get yourself to be declared to be engaged in adventure in the way of trade. In other words, no capital gains exemption for your primary residence, but capital gains tax due on the “profit” between selling price and adjusted cost base.

It doesn’t matter if your friend develops his property to the max then sells it, as long as he lived in it and declared it as his primary residence. But if he does this serially, he is bound to get nailed (see above.)

#88 DM in C on 06.19.09 at 3:41 pm

Hahahaha. The REIC is getting desperate in Calgary.


“Calgary real estate pros to hold industry extravaganza

CALGARY – With Calgary’s housing market picking up steam again, more than 80 real estate professionals, 20 bankers and several home renovation experts and mortgage insurers will gather Saturday for a one-day home buying and renovation extravaganza.

A carnival atmosphere is planned for two RONA locations — 90 Crowfoot Way N.W. and 9630 Macleod Trail S — for the Under the Tent Home Buyers and Renovation Event, which is a free information day of seminars and one-on-one home buying, financial and advisory services open to the general public from 9:30 a.m. to 4 p.m.”

THIS is the funniest [saddest?!?] thing about it,

“All the sponsors of the Under the Tent Home Buyers and Renovation Event, including the 80 realtors, have pooled their funds to provide a donation of $1,600 to Habitat for Humanity.”

Never mind it’s completely out of context and should have been the lead feature (positive spin for a maligned industry), they’re promoted the fact they all gave about $20.

#89 thecomingDepression on 06.19.09 at 3:44 pm

Go over to Urban Fare in Yaletown and talk to some of the insane agents about R.E in Vancouver. “They Chinese will hold it up” (like they enjoy losing investments) “The Iranians are moving their money here”. (all 12 of them) “The Olympics will expand Real Estate prices”. ( The party is over in 10 days clean the mess up, shut the lights out I’m going home) “I don’t want to miss out on the increase of prices, I better buy now”.(What was that?) “Spring is not only the best time to sell real estate, its robust all year ’round” (I’ll wait for a winter storm, to sell, thank you.. more buyers)
Not only are they delusional they are mentally challenged

#90 pbrasseur on 06.19.09 at 3:59 pm

From Peter Schiff, this is pretty good, check it out.


#91 Vancouver_bear on 06.19.09 at 4:11 pm

Here is a video from one of the recent developments near very popular area in Burnaby BC, across from Central park. Developer bought land for new townhomes….and turned it into a……park. Nice, eh?

The quality may be no that great (taken with cellphone) but gives the idea.


#92 Just a Carpenter on 06.19.09 at 4:21 pm

Knock BC all you want, deep down inside we all know it stems from deep rooted jealousy! The parade of out of province plates down my street every weekend continues.
Garth we are all unemployable, so we become entrepreneurs. Amidst all the griping of high unemployment the guys who have been reputable, honest and provided good service are all busy. So while you are suffering in the congestion and smog or hiding from the bugs at the bunker, we are enjoying life, working just enough to enjoy real living. Next time spend time in the real world here, not just the musty ballroom and the bar @ Joeys. The scenery is just as good in the open and the air quality better but you have to learn how to chill and go with the flow! “It’s not all about the money”

#93 Dave on 06.19.09 at 4:25 pm

Garth, your numbers are garbage. First off, that 70% figure is out of date by one year. Since then prices are down, interest rates are down and incomes are up. All told, that has significantly changed the affordability equation. Second, the average person in Vancouver does not buy a SFH. Rather, only a small percentage of people do and their incomes are far from being ‘average’. Most new home buyers in the Vancouver market start out by purchasing condos, which are significantly more affordable. The percent of income devoted to such a mortage (using averages) is around 30-35%.

Not so scary now is it?

So, what is the “new” figure for the amount of disposable income required to carry the average home, on the average income, in Vancouver? — Garth

#94 Tom Jeffries on 06.19.09 at 4:25 pm

Chapter 1 WEB OF DEBT – Ellen Hodgson Brown


“The great Oz as spoken! Pay no attention to that man behind the curtain! I am the great and powerful Wizard of Oz!”

In refreshing contrast to the impenetrable writings of economists, the classic fairytale The Wizard of Oz has delighted young and old for over a century. It was first published by L. Frank Baum as The Wonderful Wizard of Oz in 1900. In 1939, it was made into a hit Hollywood movie starring Judy Garland, and later it was made into the popular stage play The Wiz.

Few of the millions who have enjoyed this charming tale have suspected that its imagery was drawn from that most obscure and tedious of subjects, banking and finance.

Fewer still have suspected that the real-life folk heroes who inspired its plot may have had the answer to the financial crisis facing the country today!

The economic allusions in Baum’s tale were first observed in 1964 by a schoolteacher named Henry Littlefield, who called the story “a parable on Populism,” referring to the People’s Party movement challenging the banking monopoly in the late nineteenth century.

Other analysts later picked up the theme. Economist Hugh Rockoff, writing in the Journal of Political Economy in 1990, called the story a “monetary allegory.”

Professor Tim Ziaukas, writing in 1998, stated:

“The Wizard of Oz” . . . was written at a time when American society was consumed by the debate over the “financial question,” that is, the creation and circulation of money. . . .

The characters of “The Wizard of Oz” represented those deeply involved in the debate: the Scarecrow as the farmers, the Tin Woodman as the industrial workers, the Lion as silver advocate William Jennings Bryan and Dorothy as the archetypal American girl.

#95 David Bakody on 06.19.09 at 4:25 pm

#79 crashing yuppy on 06.19.09 at 1:15 pm

Sir/Madame you can bank on, Christmas is always a strain on many and finding money to play spectator will be beyond belief ….as mentioned one major company has backed out as a key sponsor ….. and as far as ticket sales, scalpers will be taking a bath, even people who do go will be taking box lunches and cutting corners ….. and all those plans for selling Olympic RE …. gonzo ….. Expo 67 will seem like a parking ticket in comparison! By the way did the city of Vancouver not already borrow $800B for some complex? So Sir/Madame why have the taxpayers of BC not demanded to see the balance sheets prior to the opening ceremonies ….. is BC not the land “Reform Accountability”?

#96 rory on 06.19.09 at 4:29 pm

Quebec providing $8000 for the purchase of an electric vehicle …jeez for a have not province where does the Quebec gov’t get the money to pay for that …oh yeah …the rest of Canada…more Western than Eastern …great deal for Quebecers…subsidies – hate them for the unfairness.

#97 David Bakody on 06.19.09 at 4:43 pm

#57 evilfred on 06.19.09 at 11:23 am

Read Rondey’s words Sir/Madame. (also) Many years ago a good friend bought and rented a couple of duplexes and he told me when he finally unloaded them this ….. “It was nothing but a nightmare and in the end I had to unload them well below market value” Also Sir/Madame a good friend went to lot sale ( normally for contractors) bid on and acquired a lot to build a retirement home … he got the lot at a good price ….. then the contractors put the screws to him and he had to contract out many things and one hell of time completing it to exact specifications that seem to change every time he sought approval. Rights for little guys/gals …. you betcha!

#51 Rodney on 06.19.09 at 10:23 am

#98 Mark on 06.19.09 at 4:44 pm

I have to admit. I’m a Brit – who has been living in Vancouver for 4 years now (moved here from Montreal)

One thing i’ve noticed about the locals is that they’re incredibly boring people compared to the rest of Canada. My personal take on this, is that they’ve become so obsessed with buying real estate, and appearing to be rich (loans to buy latest fashion/cars/etc) – that they’re so loaned up to the eyeballs that “being rich” is furthest from the truth than you can get.

Subsequently they cant afford to do anything, and spend their evenings staring at the walls of their pretty appartments (or sitting in their expensive car, unable to afford gas to drive it anywhere).

All this has added up to make Vancouver a very boring city, where the locals are unfriendly (compared to the rest of Canada) – because they’re so worried about their debts that being nice is last thing on their minds.. Especially to people they perceive as “Being poor” (i.e. the renters – who ironically are probably better off than they are).

Obviously i’m over generalising here. But anyone who disagrees – spend some time hanging out in yaletown.

#99 Dan in Victoria on 06.19.09 at 4:55 pm

I think out here in BC we suffer from”Big”…Big egos,Big trucks,Big boats,Big cars,Big houses,Big mortgages,Big bills,……Big bubble,Big crash,Big trouble.

#100 pricedoutfornow on 06.19.09 at 5:50 pm

That household to debt article is pretty interesting. I’m in my 30s, work in an area where I have information about individuals’ financial positions. I noticed that a lot of older people have accumulated lots of cash (in the hundreds of thousands by the time they’re in their 60s) plus the house where they live.
And then I look at my own generation. Seems to be a depressing situation. Lots of people around my age have huge student loans, huge mortgages or a combination of both. And the incomes we earn are not large either (not all, of course, some people do quite well). So I wonder how we will get to the same position as these older people-will we also manage to save hundreds of thousands of dollars by the time we retire? Maybe, but having a huge student loan and a huge mortgage doesn’t seem like a good start.

#101 David on 06.19.09 at 6:07 pm

People used to say that BC was the California of Canada, the trend setter in politics, culture and transformation. There is an element of truth in that quip. The Real California south of the border is a financial mess at the moment and people with any doubts about this statement can check the grim economic data for themselves. Terms like ground zero for the housing bubble bust crop up numerous times on every news clip. State and local governments in California are at risk of defaulting on their debt obligations as tax revenues dwindle. Home prices in the SoCal Inland Empire are reverting to 1989 pre-inflation adjusted levels.
Sorry to rain on the parade, but Marin, Mendocino and Humbolt Counties in California can not grow enough cannabis to save the California economy from its current state and the same would be true of BC. The price support mechanism is called taxpayer funded law enforcement. Great economics.
Single Mom has the option of hanging on to properties with diminishing value and languid rental income from bum tenants or getting out while the getting is good.

#102 Crazy BC Mortgage Broker on 06.19.09 at 6:22 pm

Hi Garth: Mortgage broker from BC again or should I say crazy mortgage broker from BC. I have determined that reading your blog is bad for my business.
I just had a conversation with a client who is transferring to my community from Victoria. He has sold his condo in Victoria for $296000 which he bought 2.5 years ago for $289000. His outstanding mortgage balance is $290000. + penalty. With a rate of 5.09%. He advises his penalty is $15000.
The good news is his employer (that would be us) is going to pay real estate commission, legal fees, moving costs and a portion of that penalty equal to 3 months interest .
His question. Should he port the mortgage and continue to pay the 5.09 or pay the penalty and start afresh. I of course advised him to pay the penalty if his employer is picking up half of it as otherwise by virtual of combined principal and interest payment-that penalty is paid over time.
At the same time though, I find this little Garth with furrowed brow on my right shoulder saying yes sell and rent for a year or two in your new community.
Bad for business….
On another note, the single mom with the rental that was utilized as a grow show opens a new can of worms as this must be disclosed when listing a house for sale. Some municipalities will condemn property until it has been remediated CMHC is reluctant to lend on these properties which can create a Catch 22 if the vendor refuses or is unable to perform the necessary remediation.

#103 supersocco on 06.19.09 at 6:53 pm

Well, Vancouver is perhaps more comparable to SF than Nashville.
Average San Francisco $682,000 -19.6
-19.6 down from a year ago

That is still crazy high.

My audience was from across America. — Garth

#104 Greg W., Oakville on 06.19.09 at 7:07 pm

Hi Garth, This might be an interesting topic tomorrow on CBC radio Quirks & Quarks 12:10-1pm

This is Your Brain on Dough.

As the global economic melt-down continues, we take a crack at the dismal science of economics and decision-making. It turns out that what may really be to blame for the collapse of banks, the crash of the stock market and those trillion dollar bail-outs – is our pathetic human brains. Researchers are gaining a better understanding of how the bad decisions we so often make, when it comes to money, can be traced to our fundamental biology and psychology and how we evolved to make choices.

Plus – a Canadian plan for an elevator to space.

#105 squidly77 on 06.19.09 at 7:31 pm

think buying and selling houses is a tax free exercise
better think again
even 1 transaction of your principle residence can be considered earned income

the taxman gonna have some fun

#106 john m. on 06.19.09 at 7:32 pm

Absolutely right Garth..i was a builder in BC for about 20 years.when you have to pay $200,000 +for the least attractive lot,in the worst neighborhood…..in a climate where you don’t see blue sky for at least 5 months of the year..crime is rampant…….when the average wage earner has to bunk up with 3 buddies to afford the price of an apartment ……..something is wrong…..where is the industrial backbone or resource.sadly i can’t think of one…..fishing is done………logging is headed for disaster………tourism is fading…………..actually i have read that marijuana is by far the biggest industry in BC?………..oh yes what a future?????????? the crash coming there will be astronomical.IMO

#107 Nostradamus jr. on 06.19.09 at 7:59 pm


#108 Nostradamus jr. on 06.19.09 at 8:11 pm

Garth is


#109 Naramata on 06.19.09 at 8:12 pm

#47 — health investment question — software for medical records might be profitable.

J&J has good pipeline.

#110 taxpayer like you on 06.19.09 at 8:16 pm

104 squidly

“even 1 transaction of your principle residence can be considered earned income”

Example? Reference? Ruling? Legislation? Pls & thanx.

#111 Dan in Victoria on 06.19.09 at 8:19 pm

#104 Squidly,It’s amazing how many people think you can continually buy/build/live in houses and not pay tax.Beware, I know 3 diffrent people who have had the tax man and their pal “Big Bill” come calling.#105 John,Heck 200+grand is a deal now,its gotten waaaay stupider ,I see one for 350 grand about a 5 minute drive from my place,and theres some lesser cost ones going the other way, but you’re going to pump 100 plus yards into the hole just to get to street level.I was working on one the other day 52 meters to get to grade.I guess theres so much land here we just stack it on edge.

#112 . . . fried eggs and spam . . . on 06.19.09 at 8:28 pm

#62 Nostradamus jr. at 11:44 am — “. . . shifting from America to China…” — That is what I posted last night. With the Aryan (white) race’s cycle almost finished, the Red race (Orientals) begin a new one.

Now that Japan has re-entered the arms race (there’s not much else for them to build now), a good guess would be that the Oriental countries, along with Russia and some eastern European countries, will eventually become solidified against western countries and beliefs.

This link — http://tinyurl.com/n22834 — along with the comment from wrh.com takes it a little further, if one is prepared to expand their horizons:

“The North Korean Missile does not have the range to reach Hawaii and obviously North Korea is not going to do something so stupid as to give the US the excuse the US Government wants to crank up a major war. So this “fortification” is just for propaganda purposes.”

One possibility is that America is gearing up for WW3, by placing their military in strategic positions. They know that Japan is building arms, China and Japan are dumping the dollar and ultimately, one company — Halliburton — will be laughing all the way to a (broke) bank.

The life cycle — The Wheel of the Eighty Four, as Siddartha Gautama (the Buddha) said — always turns.
#64 rory at 11:49 am — “. . . been liquidating like crazy …now got the ‘cash is king’ thing going …now what? 70% cash, 20% value mutual fund, and 10% precious metals, 0% RE….”

Nicely diversified. Suggestions from moi — shift 25% cash into agricultural commodities, 10% (total 35%) into silver coins and leave the rest alone.

Come summer / fall 2011, should be plenty of nice duplexes, one side to rent out and the other to live in or townhomes to choose from (but only if necessary).
#70 Nostradamus Jr.’s Analyst at 12:28 pm — “That leaves grow-ops to sustain us – why don’t we legalize marijuana and kill that off too.”

Portugal decriminalized drugs in 2001, and the crime rate is all but gone. Holland has started on the same path, and California (which is broke anyway) is also looking at this option.

If it reduces crime. it’s worth it. There are a right bunch of jackasses in Kelowna now, and it’s not even summer holidays yet.
Hindsight is 20-20. It’s easy to criticize one’s successor — http://tinyurl.com/nwlzft — but there is always another side to the story — http://tinyurl.com/lxhqaw
For those that have been following the Iran election BS, this. — http://tinyurl.com/kodtmu

“Some blogs, including WhatReallyhappened.com, are pointing out that the LA Times used a similar photograph which showed President Ahmadinejad waving to supporters. The Getty pictures we received did not show Mr Ahmadinejad.

“When a reader contacted us about it, we checked our caption and corrected it. We’re sorry for the mistake and have added a note explaining the correction to the story.”

Webmaster’s Commentary: “I … will … not … gloat … I … will … not … gloat … Per reader request, here is the original article. — http://tinyurl.com/nrv9fh

#113 Marc on 06.19.09 at 8:31 pm

Vancouver can be pretty depressing when it rains for 4 weeks straight, but once the sun comes out, I wouldn’t want to live anywhere else. Mountains, ocean, can ski and golf on the sameday. The rain is like a long airplane ride. Uncomfortable for the time on it, but once the destination is reached, the uncomfort is quickly forgotten. Also weed helps.

#114 Naramata on 06.19.09 at 10:53 pm

#51 Did you do reference checks?

I’ve had rentals since 1983 (Vancouver basement suite, West Van ..extension)– and it has allowed me to live where I want and build equity. I had 1 bad tennant (Apex) — I didn’t do reference checks and it was too far to do drive-by checks.

After reading “The Strategy” I bought 3 rental properties …at the right time …but …there is no free lunch…you have to do the work …and that is:
1. Check the references
2. Be prepared to be “Mr. Fix-it” or have a plumber, electrician, Sears, and carpenter you can call.

It has been good for me…at at certain time, in a certain place . I do not see any similar opportunities now. …within drive-by distance. The numbers don’t work.

#115 dgd on 06.19.09 at 11:16 pm

This has to be the silliest I’ve seen this blog get.

You people are out of control………..is there a full moon?

Garth shut it down before it just gets plain silly.

#116 Bailing in BC on 06.19.09 at 11:22 pm

I am SMLFTRD’s friend who sold her investment in Kamloops at the right time. Damn me!!!

I can assure you that this letter is true.

SMLFTRD managed to accumulate equity through luck (being in the right place at the right time) but mostly through guts and hard work.

She did not fleece any ex husbands. She did however guilt her ex into getting a loan for her that she would not qualify for and then made all payments until she paid it off in full.

She got her first property renovated on a credit card and through barter (I’ll clean your house for 6 months if you do my electric etc.).

The suite got reno’ed first to bring in rent asap, while she lived upstairs with no kitchen and the most rudimentary of bathrooms.

She has done very well because she didn’t sit back with her success but went out and grew her holdings. She took calculated risks and they have paid off.

She has worked VERY hard for what she has. She has lived in renos for the last 7 or so years, a lot of which she has done herself. She is 5 foot nothing and has been known to do her own drywall.

She also deals with scum bag tenants because she has no one else to do it for her. The property managers that she has dealt with in the past are ineffectual since they have no skin in the game. As for kicking tenants out anyone who suggests that it’s easy has never had to do it. The changes to the legislation are relatively new and some of the staff at the RTO either do not know about them, or else, they are not telling landlords when they call for information. Anyway what’s so easy about paying a bailiff THOUSANDS OF DOLLARS to kick out a dead beat tenant who wouldn’t pay their rent and has trashed your place?

Before anybody jumps on me, I don’t think all tenants are dirtbags and I know that some landlords are exactly that.

#117 CAPOFALBERTA on 06.19.09 at 11:27 pm

Being also from Edmonton, I am wondering what is causing this surge in the market here. Great points from both posts. I too could jump into the market right now and still be comfortable thanks to the low morgage rates. If rates do go up that will probably price out a lot of buyers now(not during the boom though). It does make sense that a lot of young people would jump on the band wagon, I would like to know if that semi retired realtor has done deals with these 20 year olds and how much down payment are they going in with ?? Any other EDMONTON trends out there??

#118 CAPOFALBERTA on 06.19.09 at 11:30 pm

GARTH have you ever thought of doing a region by region post. I know there a lot of posters from Ontario and BC, would like to know what your views on the markets outside of these proviences shape up to be

#119 Just a Carpenter on 06.20.09 at 12:11 am

#104 The taxman ruleth

The criteria for tax exemption on capital gain with your principal residence is all do do with the reason you have for selling. If your reasons for selling match the criteria set by Rev Can then you good to go. If for what ever reason they determine that you are selling to earn income then they will assess you.
As someone who works in the business I am particularily vunerable to scrutiny according to my accountant. I could live in a home for 5 or 10 years and still be assessed if it is determined that my primary motivation for selling was to earn income.
Reasonable motive for selling include job transfer, proximity to kids schools, growing family, financial hardship such as disability or job loss, divorce or separation.
As much as I am tempted to play the game I keep my business and personal income separate. My home is where I live, where I entertain family and friends and where I hope one day to spoil my grandkids. My kids can decide otherwise after I’m gone.

#120 dd on 06.20.09 at 12:12 am

.#44 Calgary Rip off

…The same house in Katy Texas(outside of Houston) where it would be $500K here in Calgary would be $130K there at most….

I have heard this before but people would say the homes are not built to Canadian winter standards. True enough but $350k more?

Just look in the crystal ball (the states) and see what is coming down the pipe. House pricing has to come down.

#121 Rich in Calgary on 06.20.09 at 12:13 am

#5 Flipper said:

“P.S. I am a great cook, I do laundry and most importantly put the lid down before I go.”

Your bathroom must be a pain to clean. LOL.

#122 NorthVanDude on 06.20.09 at 12:14 am

# 98 Mark – sounds like you got it just about right. I just moved back here after living in Dublin for 3 years.

People here are so maxed out that they cannot afford the time or attention to have a good time. The problem is that so many people buy into that trap. If enough people said f^&* it, i’ll just not buy that huge house or that SUV, the city would transform itself into something more interesting.

Everyone is working all the time just to pay the mortgage, but they don’t even realise it would all stop if they just lived within their means.

#123 dd on 06.20.09 at 12:15 am

.#110 taxpayer like you

…“even 1 transaction of your principle residence can be considered earned income” Example? Reference? Ruling? Legislation? Pls & thanx….

Don’t be lazy. Look it up in the income tax act.

#124 dgd on 06.20.09 at 12:22 am

He isn’t such a bad guy after all…….


Sounds like he is trying to cool the euphoria recent.

Maybe he does know what he is doing.


#125 Rural Rick on 06.20.09 at 12:36 am

I have to say my favorite post in a long time is #107. After a while our ideals change from “I will give my life in defense of your right to be heard” to “shut the f*#k up.”
Thank you Garth.

#126 kc on 06.20.09 at 12:48 am


“Would $3,500 or $4,500 help you with your new car purchase? The “Cash for Clunkers” Bill is awaiting Obama’s signature in America. In Germany they are getting $4000.

Canada, due to its “turning the corner” green vision offers….(drumroll)….$300.
going forward ”

When you sell off an old car you are buying into the CREDIT game….. think about this for a second… Someone wants you to buy a new car/truck…. why?? to indebt you even more, sign here please… lIt has abolutley NOTHING to do with global warming and save the planet BS. it is to make you believe that you are doing the world a good deed by buying some over priced POS and running a higher credit bill at the end of it… who makes the money?? banks and lease officers… peroid.

give you a good example. for years i have driven a 91 vehicle here we have a driving tax called air care that you have to get your tail pipe inspected every year @ $22 bucks a shot, in all the years of driving this truck it has never failed even with 420K Kms. I finally got a different truck and pulled the motor out of the 91 to rebuild and I will place it into the new one I just picked up for $400. People today rather go into hock and have the I am rich look than figure it out for themselves. Sorry I don’t buy into the whole scheme of it. How many people pay a vehicle out right?? it is all a suckers game.

#127 . . . fried eggs and spam . . . on 06.20.09 at 12:59 am

‘Owzabout US$300 / brl. oil? — http://tinyurl.com/n27ddx
Put these three links together — http://tinyurl.com/kr4mo9 /\ http://tinyurl.com/l53nxm /\ http://tinyurl.com/nkew8p — and notice that the west is royally screwed. From the first link . . .

“Responding to the Obama administration’s new regulatory reform plan, which will officially hand the Federal Reserve complete dictatorial control over the U.S. economy, Congressman Ron Paul told MSNBC that the Fed was now more powerful than Congress.”

Webmaster’s Commentary: “Basically, the Federal Reserve has foreclosed on the US Government.”

From the Daily Mail link . . . “A job is now being lost every 30 seconds . . . McDonald’s receiving 2,200 applications a day . . . Directors and CEOs claiming the dole up 200%”. — Also: — http://tinyurl.com/kjr4jh
The US Treasury will auction US$104 Bln. of debt next week — http://tinyurl.com/kn8ysq (what happens if, like Latvia last week no one buys?) and at the same time Congress rubber-stamps US$106 bln. for the war — http://tinyurl.com/n8mpry

Add in Obama’s Health Care reforms, estimated at US$1 trillion — http://tinyurl.com/mm57ce.

Correct me if I’m wrong, but the US isn’t at war with anyone, hasn’t declared war so why spend money on nothing? Ah yes! The world is heading toward being Iceland and Latvia all over again!

#128 smw on 06.20.09 at 1:55 am

#107 , #108

I wish you peace and happiness; and all sorts of other good stuff that you yourself would only wish upon your fellow eastern Canadian. (Which is 95% of the population in your “little’ world.

PS I don’t like to throw words around without meaning, but I think your a di!k.

Take the rest of the week off and contemplate what the ! might mean.

And if you figure out that puzzle, take another week and figure out why I’d make that reference to you.

Hugs! XOXO


#129 smw on 06.20.09 at 2:11 am

#90 pbrasseur

Peter’s knows his stuff. His ramblings have protected my pewny pension.

Its too bad that there’s been too many “sword” fights over the specifics of what happening and not enough of the contrarians standing up stating and whats going to happen.

Now is the time to listen to the commodity perma-bulls…

They’re right,

Remember a clock strikes 12 twice every day…

Ding Ding Ding Ding, Ding Ding Ding Ding, until 12.

#130 smw on 06.20.09 at 2:12 am

#62 Nostradamus jr.

Long Beach

#131 Tony on 06.20.09 at 2:17 am

#64 Rory
The smart market is all short Russian stocks. The American stock market has hit the wall around the DOW 8500 area. The US market influences all the markets except sometimes Hong Kong and Japan. Don’t let this garbage about low volatility throw you in the American stock markets. The US markets will fall hard and very soon. The bear market rally is over as of the end of this month! Stocks will in price continue to fall for the rest of the year. The smart money is short the emerging markets with the smartest money short Russian stocks. For excellent stock pickers such as myself you can always hedge the basic market indexes and buy stocks dollar for dollar. I usually outperform the market by about a 3 to 1 ratio. This is a good strategy instead of going insane by watching your stock picks go up strong and not being able to buy them knowing full well the bottom will fall out of the market very, very soon and the basic law of probability will defeat you (you’ll always lose with any stock pick without a hedge unless it’s a day trade in a very volatile stock when the market is falling 30 percent and you’re long).

#132 Glenn on 06.20.09 at 2:18 am

There is no “$1,890 monthly allowance” and if you want to be a refugee, I’m sure many people on this blog would be happy to assist you. That was your last post, dude. — Garth

Highly unlikely, Garth. I stick around (or am not banned?) so as to make the locals feel oh so much better about themselves. it must comfort the locals, knowing they are not a knuckle dragging buffoon of an American like myself.

In all seriousness, I am a disabled veteran with no criminal record, and a fairly decent pension and nobody here would be caught dead lifting a pinky on my behalf. I also refuse to be an “illegal immigrant”.

I am also every bit the muckraker this Nostradamus is, if not more so. I have posted much more offensive opinions (ok, facts). Anyhow, perhaps we should all go look up the Canadian refugee stipulations. I have been giving the idea some consideration lately.

#133 dd on 06.20.09 at 2:53 am

Quote of the day

“banks taking stress tests could be likened to a
student who is given a take-home examination that he grades himself with some grading guidelines from
the teacher. Unfortunately, our student completely failed this exam, but then negotiated with his teacher
to get a passing grade based on how hard he intends to work in the future”

#134 Nostradamus jr. on 06.20.09 at 8:53 am

…Freedom of


#135 Dan in Victoria on 06.20.09 at 10:44 am

Post #126 KC Yes,you got that right credit ,credit and more credit.I wonder how many people have pulled wrenches to save money, not very many now a days .Idiots,50- 60 grand for a new pickup plus interest payments.I haven’t spent that my entire life on trucks.The last one we bought,I went with the wife to the dealer and we took a new one for a test drive,brought it back,drove up the road and picked up the used one I had just bought.It was the same model and colour.”What was that about she asked?”Well I said,you said you wanted to drive a new one off the lot,there you go,and it didn’t cost you anything.”She’s used to me now.

#136 Chris no longer in England on 06.20.09 at 11:15 am

#64 rory: “So where is the big, smart money parked and what it is doing? Comments?”

I have my own question to add to this. Being new in Canada and needing professional advice about investing, how do I find an honest, competent financial adviser that isn’t going to take me for a ride?

#137 taxpayer like you on 06.20.09 at 11:19 am

123 dd. Yeah sure. Last time you claimed a “fact” you
were so far out to lunch about 10 bloggers nailed you in 5

Carpenter – thank you. I understand the theory of deriving “income” from selling your principal residence, especially if you do it regularly, or like you are in the biz.

Squidlys original post sounds all-encompassing, and why would he think that, unless he found a ruling, example, court case, etc. So once again, I’m asking him respectfully to provide that reference, so I can learn, even if dd is beyond help……

#138 Samantha on 06.20.09 at 12:35 pm

#126 kc and #135 Dan in Victoria

Bang on kc and LOL Dan – good story.

We also refuse to purchase a new vehicle. We have a ‘97 and just replaced the motor (a dealer repair problem blew our original motor). The new motor (out of the crate from GMC) was a deal due to what happened – we got it at cost and it was installed free of charge.

We will be replacing the transmission this fall. With our usual schedule of proper maintenance and sensible driving, this vehicle will run for at least another 12 years.

If they insist we go green by banning vehicles over a certain age, then I’ll get a pair of horses. You can’t get greener than that – their emissions create lovely fertilizer once it ages.

#139 dd on 06.20.09 at 3:51 pm

.#137 taxpayer like you on 06.20.09 at 11:19 am
123 dd. Yeah sure. Last time you claimed a “fact” you
were so far out to lunch about 10 bloggers nailed you in 5 minutes.

Could you please back that up with facts please.

#140 taxpayer like you on 06.20.09 at 8:22 pm

dd on 06.08.09 at 9:09 pm
taxpayer like you on

“JoJo 49….“Canada has the highest income taxes in the world for workers.” Please provide reference”

What? It is a fact. U don’t need to provide a reference.

#141 Mike (Authentic) on 06.22.09 at 3:36 am

Great post.

Interesting timing with the topic as we have my in-laws over from BC here in London. They are from a small coastal town, 2 ferry rides away from Vancouver (that just called themself a city at 18,000 people!) and are completely convinced that their small lumber town is “different and special” from the world economy!

No RE bubble there, $400k homes in the middle of nowhere in a retail town with no future is perfectly normal.

No roads lead to anywhere from there.


#142 Tony on 06.23.09 at 8:17 am

RE: #131 Tony

Note the part about the Russian stock market.

#143 randy jeannotte on 07.08.09 at 1:04 am

Where do I start. I have experience as an investor (stocks, mutual funds etc.) and as a real estate investor. Real Estate is where I have made money and stocks/mutual funds are where I have lost money. I feel mutual funds are terrible with the high MERS and average returns, why would you invest? I bought 21 rental condos in Courtenay BC in 2004 for an average cost of just over $50K per unit. My rent is $750 per month and they are now worth $125K. I don’t know of anyone personally or through my large network of friends that have made their fortune in stocks/mutual funds BUT know many that have done it through real estate. Are there a few headaches with RE? Yes, very few But I can buy a lot of advil with 1.5 million. Stop and think…you put down 25%, your tenant pays your mortgage, you can depreciate the rental despite the fact over the long haul it goes up, you get income from rents…no brainer….maybe I could have done as well in stocks etc had I invested with a “professional” like Madoff or Ian Thow…lets see if this get posted …PS read the online book Conspiracy Of The Rich by Robert Kiyosaki…and get the truth.

#144 Ali Yen on 10.20.09 at 11:33 am

How to buy a house at 20 with 3.5% down, one full time job and two extras to keep afloat, but houses price in U.S are going up aren’t they ?