Garth: First, I want to thank you for your blogs. I am sort of excited, sending an email to you. You see, growing up in my family you, my dear Garth, have demagoguery status! My accountant brother can’t get enough of you and my mother quotes you constantly.

Anyway,I have futily tried to keep things in line with your advice however, I ended up making a huge mistake and frankly, feel like a pretty great fool. We bought a home in Vancouver’s hideous inflated west side in 2005. We had a  375,000 mortgage on a nice home we had reno’d. I thought the mortgage was huge ( in hindsight I see it wasn’t!) When the markets starting tanking in October 2008 we stupidly panicked, put the house up for sale and essentially gave it away for about 1,000,000 and  then rented a home for a hideous monthly fee and intended to buy again when values “stabililzed”. Well to our dismay, the average house price one year later in the same area is 1,400,000. Needless to say we have been unceremoniously turfed out of the Vancouver housing market due to our unfounded fear about a housing crash that never happened. I am not challenging you, I know in time this market cannot sustain itself but in the meantime we have to live somewhere in Vancouver and with a 70% increase in house value in 10 years  and an a steady stream of  strong asian cashflows, it seems a correction will never come.  I dont want to lose out on equity and our lease is up and what the heck do we do next?   We are mid forties, our combined income is about $150,000 and we have about 600,000 to put down, luckily no debt otherwise. The thought of going to a cramped condo after living in a  nice home is depressing not to mention the  resentment over the mountain of equity we lost.

Any scrap of  advice would be graciously appreciated..regardless,  I will tell my mom we’ve “talked!”

Thanks so much and take care, Elaine.

Ah, the flattery is appreciated, and your family has impeccable taste in financial oracles. However, you are ‘so damn Vancouver’, I hardly know where to begin.

Yes, the property crash of autumn ’08 looked like to would continue apace and result in a market correction with the potential to make you look like a genius. But as we know, when the feds crashed interest rates to zero the resulting borrowing orgy caused the Van disease to spread once again. Add in the unfathomable Olympic influence and the predilection of BC media to hire business commentators who are, by day, self-promoting and self-dealing real estate hucksters, and a mile-thick fog of delusion descended upon the land.

How long it lasts is anyone’s guess. Maybe well into 2010, maybe not. But until that damn flame goes out, interest rates rise and people wake up to the debt morass they’ve sunk into, this madness will bleat on. So, whaddya do about it?

First, exactly what you are doing, which staying out of the housing market until at least next summer. Let’s allow this Olympic boosterism to disintegrate into a bad memory of civic indebtedness. Let’s see what the inevitable Bank of Canada rate hikes do to a frothy housing market. And let’s discover just what pinnacle of delirium your fellow real estate junkies can push prices to before little Vancouver becomes completely unaffordable to the people who live there. Then you’ll feel so happy you didn’t buy that you’ll even forget about the money you could have made by not selling (which will probably be lost anyway).

Second, get out of town for a week and gain some perspective. Even you admit the market’s unsustainable, so seven days away from Global BC might be necessary shock therapy. Third, realize you’re simply nuts if you pump $600,000 in cash into the most expensive housing market in Canada at its priciest moment, when this means all your net worth will be in one asset, plus you’ll have $800,000 in shiny new debt at rates which can only rise. Did you score a $150,000-per-year income being so stupid? I doubt it.

There is, after all, something between a ‘cramped condo’ and a million-dollar spread in West Van. I hear there are people out East, over the mountains, who actually live in townhouses and bungalows, on farms and in semis. Many, would you believe it, have no mortgage.

And some, Elaine baby, might be happy with six hundred large in cash and twice the annual income of their neighbours.

But, what do they know? Fools. Success is stuff.


#1 Soju on 12.04.09 at 8:46 pm

Only in Vancouver can someone make so much money through real estate and be clueless at the same time.

#2 AxeHead on 12.04.09 at 8:46 pm

1.4 M in Alberta buys an mansion, but also buys high taxes, high maintenance, and low resale. It also buys a small village in Newfoundland.

#3 squidly77 on 12.04.09 at 8:48 pm

telling it like it is

have a look at this graph

when these arms reset the consequences to the economy will be enormous

when these prime borrowers default on their mortgages credit card delinquincies and other debt obligations will soar

Option” mortgages to explode, officials warn

#4 eggy on 12.04.09 at 9:04 pm

Here’s a thought: consider leaving Vancouver. The weather is nice there (if you don’t mind a couple months of rain in the winter) but other than that it, Vancouver isn’t what it used to be and gets worse all the time. If you are mobile, consider a mid-size city somewhere in Canada.

#5 Roial1 on 12.04.09 at 9:14 pm

Elain, Take a LOOOONNNGGG look at V.I.
Vancouver is not that hard to get to from either Comox Valley or Campbell River. (Both have commuter flights from their air ports.)
My good friend has a large duplex on the Sequoia Springs Golf coarse for under $299,000. Leaves a lot of cash over.

#6 OttawaMike on 12.04.09 at 9:20 pm

24 hours with no comment left on Garth’s blog on how gold is going to the moon. Blasphemy!
Here’s one from yesterday, (we don’t need to talk about today’s gold closing price):

#7 Bob on 12.04.09 at 9:30 pm

I have relatives with a combined income of $150k… but they also have a $500k mortgage in Alberta, and an $80k LOC, with a baby on the way. I’m simply baffled how some very smart people can make such stupid decisions… I seriously fear for their financial future if/when the market corrects.

#8 Crash on 12.04.09 at 9:45 pm

This letter illustrates what is wrong with people in Vancouver; they (especially the Westside crowd) all see real estate as an investment, not as shelter. Also, why sell just because prices start to decline? Don’t you need a place to live? What a dumb move. They could obviously afford the house to begin with, so why dump it just because the market tanks? I think I read on this blog that when prices decline, listings increase and when prices rise, listings decrease. It should work opposite to this. IMO Elaine is the epitome of dumb and greedy.

#9 Paul on 12.04.09 at 9:45 pm

Were in the same boat. It sucks. Wait till next year.

#10 Increasing that 1% on 12.04.09 at 9:47 pm

Sorry, hard to understand when you have that much cash and don’t know what to do with it. Kinda like those who win lottery and just go back to their old job.

#11 Contrarian on 12.04.09 at 9:49 pm

I think , people in Vancouver , have totally lost the concept of value of money………anyone buying a house takes up a huge mortgage , and keep paying the monthly installments for rest of the life.sounds so simple.
Part of the blame goes to RE pumping media and part to people taking huge mortgage.

#12 eddy on 12.04.09 at 9:50 pm

thanks to the blogger who recommended ‘the secret of OZ’. it’s a great movie that everyone should see. it expands on ‘the money masters’ by the same filmmaker. lists the torrent

#13 Sandy Cove Beach - redux on 12.04.09 at 10:01 pm

: growl :

Try again – the west side is NOT the municipality of West Vancouver. Not even close.

Money aside, West Van is traditionally an insular, conservative right-wing society with a completely different culture than the west end. Money not aside, a mill wouldn’t even get you a tennis court in West Van today.

#14 kc on 12.04.09 at 10:06 pm

BOOOHOOO pooor me….. Earth to head in the clouds … greed is a pissy way to measure success … I hear the great folks at mission gosple is looking for volunteers to help with the Christmas dinners… maybe you and your FAMILY can learn from the people who live on the streets and are thankful for a free turkey dinner in our city… being humble and humanitary might teach you about being thankful for what you have…. I say again… BOOOHOOOO

#15 jack on 12.04.09 at 10:19 pm

Ah, the swansong of the greedy and ungrateful : “I made $600k but I COULD’VE made $1mil! IM SO DEPRESSED!” You should be eternally gratefull that you were able to make such an un-earned windfall.

When your lease expires, renegotiate at a lower rent (pretty common right now, look up some comparables) and if you are really anxious make it month-to-month instead of a lease. If your landlord likes you he may go for it.

#16 Sid on 12.04.09 at 10:32 pm

Elaine, I feel for you, I’ve been in your situation before and it’s hard. You did the smart thing yet you still feel like you got screwed over. Be happy that you had 3 good solid years of price appreciation and use your tax free gains for your next investment. There are opportunities every day, bubbles inflation and deflating all around us. The Vancouver real estate game has been making uneducated nobody’s feel like financial geniuses for 8 years now. THis will end.

#17 Men With Hats on 12.04.09 at 10:34 pm

Buy a big boat and live on it . Property taxes are way higher than wharfage fees .
Then you can cruise the islands and make like a
billionaire .
Yachts hold their value .

#18 Mark on 12.04.09 at 10:41 pm

You are going to love this. Here in Reno, NV, one of the bubbliest markets in the U.S., we had the largest and best located casino in northern Nevada converting rooms to condos in 2006-07. They were selling for $220,000 – $250,000 for 421 SF. They are now selling for $18,000 – $25,000.

Enjoy the boom,


#19 Tony on 12.04.09 at 10:41 pm

Itulip also predicted the DOW would fall to its’ 1987 lows not so long ago. I guess they didn’t see the invisible hand of the US government and Goldman Saks. True the DOW should already be at the ’87 lows but it’s been manipulated since 1995. It’s the unforeseen things that throw a monkey wrench into things. For a comment the first comment basically sums it all up… they get lucky once push their luck on the exact same thing then give it all back with interest.

#20 Sid on 12.04.09 at 11:04 pm

#19, are you being facetious or do you just not know how much it costs to live in a yacht?

#21 T.O. Bubble Boy on 12.04.09 at 11:14 pm

The most shocking part of this story:

Elaine here bought a house in 2005, sold for $1M in 2008, and gained $600,000 along the way.

I can’t say how much her renos factor in here, but at the very least that seems like 80%-100% price appreciation in 3 years!!!

If Elaine sees housing as something you flip every 3 years, she obviously doesn’t *need* to own a home. People who are that flexible/unattached should be renters, since moving that often kills equity through all of the commissions and closing costs.

Also – the cost of renting in Vancouver right now is still probably 50% or less than owning.

Take $10,000-$20,000 of that $600,000 and go on a nice 6-month trip somewhere. That might actually save you money by getting away from the temptation of buying at the peak in Canada’s most bubbly city.

#22 Dmitri on 12.04.09 at 11:15 pm

Wow, 600,000 in cash and…… don’t know what to do with it. NO IMAGINATION! Get 1,600 sq foot townhouse in Miami for…. unbelievable price….. of $50,000. The rest will pay for may, many, many years of every weekend flights there, at least until the prices “stabilize” and you like the folks in Miami can buy something for fraction of your year’s income. Sorry, no mortgage….. Too risky. Ha Ha Ha

#23 Bottoms_Up on 12.04.09 at 11:19 pm

Let’s talk numbers. Approximate.

So, a family earning $75,000/yr, nets about $4500/mo. Let’s say they’re living expenses are $3500/mo. That leaves them with $1000/mo for savings.

How long does it take this family to save 20% to buy an average home?

Well, need $60,000 down on a $300,000 home. They could save $12,000/yr, so it would take them 5 years for the downpayment.

BUT, what would happen in those five years? Would the $300,000 home now be worth $450,000? WTF?

It’s all a pyramid scheme, designed to make the rich richer, and keep the poor renters renting.

Good luck to all.

#24 JP on 12.04.09 at 11:29 pm

Elaine, if you get this far in the comments, you and most have very little idea of what’s coming. Most will not believe what’s in store within the next 5 – 7years. Unfortunately you and many will not recognize it before its far too late. Your best option at this time would be to move from any major city centers.
Make plans certainly within the next 2 – 3 years to set yourselves up in a more remote location. A great panic in a major city when it happens is far more volatile than to be in a city that’s under assault.
So far it appears that most Empires, if indeed you can include the US as one, tend to not exit stage left quietly. In a scenario as such, think of it this way, I am in Calgary. Now lets say a strike hits Edmonton, it would be extraordinary panic to leave the city of Calgary in a most disorderly manner. In fact, many ensnared in this panic would find preference to have been in the assaulted city.
Nothing is for certain, as I will grant that, as a probability for such future events appears to increase over time and the trend continues in that direction. Unbeknown to most of the people in my life, will be only preparing with immediate family within this time left. I urge you and others to consider current trends and make reasonable adjustments in the events that appear to be unfolding.

#25 Ronaldo on 12.04.09 at 11:34 pm

Move to Nanaimo, you can purchase a beautiful home overlooking Departure Bay for $450,000 cash and stash the rest. Lower your expectations and harness that ego. Mid 45’s, 600,000 in profit in 4 years for doing zilch. Go ahead, go all in, buy that 1.4 million dollar shack and sit back and watch your $600,000 melt away once this insanity comes to an end. You are out of touch with the “Real World”.

#26 Chaostrology on 12.04.09 at 11:51 pm

OMG…talk about a hanging curve ball

Chaos swings, (kkkeeerrraaaaccckkk)!!!!, it’s going, going, going, gone. It’s outta here! It’s a homerun. What was the pitcher thinking? Throwing Chaos a hanging curve-ball! It must of looked like a canteloupe coming down the pipe! A three year old could have smashed that pitch out of the park!

Yup, Nosty, you are absolutely correct, there’s the manager, he’s up off the bench and headed to the mound. He’s motioning for a southpaw. Elaine’s game is over for today. She can take a long hot shower and just reflect on how stupid that pitch was. Well you can be good and you can be lucky but sometimes you can’t be good and lucky. We’ll just wish Elaine good luck in the future.

For those of you who can’t understand Elaine’s reality, let me help you.

-Elaine lives on the West Side of Vancouver, west of Arbutus street, south of 25th ave.
-Her car is a brand new Volvo wagon, the other car is an Infiniti.
-She has 2 children, maybe in one of the private schools in the ‘hood. The kids are very preppy and a little obnoxious.
-They are club members, The Arbutus club, Point Grey Golf Club, Vancouver Lawn & Tennis Club, The Vancouver Yatch Club, Southlands Riding Club (one of these westy clubs)
-Elaine is a great mom, her children will flourish because of the effort that she showers on them, they are ignorant of her effort because this is the status quo of this particular reality.
-The children are ear marked to attend any university that they choose.
-The sense of community and belonging that Elaine experiences on a daily basis is not to be believed. She belongs to an exclusive social set that is usually handed down from parent to child, to be rooted in this community is something of value.
-Elaine cannot be cut off from her reality, it would be like trying to live without air. The ultimate disaster for Elaine would be the wrong postal code.

I know lots of Elaines, they are abslutely fabulous people. Just don’t expect them to leave the West Side of Vancouver, and don’t be bringin’ your dirty finger nails into their ‘hood.

Here endeth the lesson.

#27 junius on 12.05.09 at 12:02 am

I understand the situation all too well. My wife and I are in a similar situation in Vancouver. We strongly believe that the housing market is going to collapse here but it puts you so at odds with everyone else. It reminds me of when my uncle lived in a small city in Texas and he believed he was the only person in town who didn’t own a gun – and was afraid to let people know it!

“Conventional wisdom” in Vancouver is that real estate cannot go down – it always goes up. Always. So many people are strapped into the market and over-leveraged they simply cannot believe it could be otherwise.

It is different here (to paraphrase a current bestseller) for a host of reasons such as (1) everyone wants to live here (2) Asian money is flowing in (3) there is no more land available and (4) because.

This is why it is ground zero in the bubble burst. 2010 is going to start with a party and end with a bang.

#28 EJ on 12.05.09 at 12:20 am

$600k on hand… Don’t people realize that there are many nice places in this world where you can retire with that kind of money? Why would you even consider throwing it back into the rat hole that is Vancouver real estate?

#29 Matt Dunnigan on 12.05.09 at 12:34 am

Blaze up some of that B.C. bud and count your money. That ought to keep you busy for a year or two.

#30 dd on 12.05.09 at 12:40 am

Yup … the Calgary real estate market is calling for a 5% increase in house prices in 2010. That announcement was on Wednesday. On Thursday Talisman (large gas producer in Calgary) announced 200 layoffs.

The layoffs are a fact. The prediction of real estate increasing 5% …

#31 nonplused on 12.05.09 at 12:42 am

Interest rates are not going up anytime soon. The central banks will print money and use it to buy government bonds to keep the long end of the curve down. And it doesn’t matter if the Chinese want to sell, sell, sell, the Fed will just buy, buy, buy. That way the Chinese get out without having to take a big haircut on the value of their bonds.

Of course, everyone, including the Chinese, knows that this will massively devalue the dollar over time. But it’s six of one, a half dozen of the other. Either take a hair cut now on bond prices or later as the dollar declines. Which is why they are using debt to buy up every hard asset they can get their hands on. Secure the assets, cash in your bonds, and then pay off the debt or let it just inflate away. Simple really.

Of course monetary debasement cannot save a local real estate market, as Japan has proven. As the cost of anything that can be put on a boat and sold somewhere else goes through the roof, there just isn’t any money left to support the debt burdens of a local, immobile market.

They will eventually get the nominal price of a house to stabilize at current levels in Canada and rise to an acceptable level compared to debt in the US, but it will be by dramatically devaluing the dollar. Only those who have long work careers ahead of them and can demand corresponding pay raises (in other words government employees) will escape unscathed. Fixed income pensioners are about to be utterly ruined. Not all at once mind you, this could take 5 to 10 years.

This is what the gold market is telling us as well. Do not trust the central banks to preserve the purchasing power of their various currencies. Their mandates are inflation of at least 2% per year, and full employment. That all by itself dictates a 95% loss of purchasing power every 35 years, except that it isn’t linear it’s exponential so you can always add more zeros and keep extending the curve. Only for the next little while they are going to be stepping on the gas much harder than 2%/year.

And don’t throw the CPI at me, it’s a rigged number designed to keep Social Security payments in check. Grannies don’t buy new computers with faster processors, they buy food and energy, both excluded. Cars aren’t cheaper because they have mandated airbags, in fact it’s questionable if they are even safer to the extent that the airbags discourage seat belt use. Highway fatalities don’t go down because of antilock brakes and traction control, people just drive even more stupid because they misunderstand the limits of the technology. In fact, it’s all modern SUV’s in the ditch these days because a guy with an old rear wheel drive truck understands quite instinctively that he shouldn’t be driving that fast, because the truck tells him so. Now you can’t tell you have no traction until it’s too late, but the CPI is hedonically adjusted to make the vehicle seem cheaper because the car is more advanced.

Side rant on traction control, perhaps the most stupid idea ever to come out of the auto manufactures. Don’t get me wrong, anti-lock breaking is probably a good thing, it does reduce stopping distances. But even that can be abused. I once got a ride from a girl (might have been a date) who was firing off the anti-locks practically every time she stopped. I asked her why she was waiting so long to stop and then hitting the brakes so hard. Her response: “They always make that noise. It’s normal.” She did not even realize that she had adopted her driving style to always reduce her factor of safety to zero.

But traction control? Why would you want to be able to accelerate so quickly in poor conditions? When I was 16, me and my friend spent many a winter hour leisurely putting our cars into skids intentionally in empty snow covered parking lots. We learned how to steer out of a skid as an unintended side result (we were just having fun), but we also learned there is a distinct limit to how much traction you have. My newish 06 Explorer cannot be made to perform these skid maneuvers; the computer will cut the power. But it will let me accelerate to insane speeds and then be of no help at all when the corner cannot be navigated at that speed and I sail right into the ditch.

I like 4 wheel drive, but if you need it to go 100kh you are going too fast. Above 60kph you need to turn it off, so your back end can tell you by kicking out whether your front end can steer. Only you can’t turn it off on modern vehicles. Hence all the SUV’s in the ditch every time it snows. Idiots.

#32 ATP on 12.05.09 at 12:51 am

#2 AxeHead on 12.04.09 at 8:46 pm

“It also buys a small village in Newfoundland.”

He, he … Don’t be so sure. Look up the following property: MLS#138183 at

It’s pretty big but a piece of s**t up close (I went to an open house event). Price recently reduced by $100,000 to 1.29 million. BTW, there is no back yard.

While you’re at the site, also check out houses priced between $500k to 1M but look at the pictures and details. Some of them will have you scratch your noggin and say ‘WTF’?

Greed is everywhere.

I still don’t understand this obsession to own. Lust, as I’ve said before.

#33 MortgageScuba on 12.05.09 at 1:17 am

Elaine, you played the safe side of the investment, and for that, you won thousands and thousands of dollars. Tax-free, too. That’s not a mistake. That might be a story you tell your grand kids about someday!

You landed safely with a parachute. The plane started up again and went back up, but you can still walk to the crash site. We don’t know where that is yet, but we know it’s low on fuel. Actually screw that, *you* can buy a lambo and drive really fast to the crash site!

The two parts to getting a deal are knowing when something is a deal, and having the cash to buy it. You have half of that problem solved right now.

P.S. I love Garth’s attitude in this message, he seems… optomistic! :)

#34 grumpy on 12.05.09 at 1:17 am

Garth, I wouldn’t believe the newest ’employment’ numbers for a second. Instead lets wait until the shopping season is over and the push for re-election of bernake is over. This is a desperate push for consumer confidence at a critical time. 100% of the time we see ‘revisions’ after the announcements anyway, this time they will just be a lot larger.

I follow the container traffic and see it hasn’t improved. I see wage fights in China as stimulus money there cranks up inflation. We can’t absorb too much more debt here as the debt/gdp is cresting 80% now. QE and extremis may not do the trick without any movement on rates. This will knock the dollar up and force the capitulation of a higher percentage of new homeowners.

The U6 numbers in the US show that a huge number of claimants are simply vanishing off the rolls as all benefits run out. The CES birth/death model ‘created over a million jobs which as you know are not in existence but merely projections.

Canada of course is always fudging its numbers and can’t be trusted for any honesty. Lets get real here Garth. People are desperate for ‘good news’ and the latest ’employment numbers’ are nothing but sugar coated pap being put out by a desperate clique of Keynsian holdouts who’s indexed pensions depend on never ending inflation boosting tax revenues.

Every pyramid scheme falters, this is no differant.

#35 robert on 12.05.09 at 1:19 am

I could easily live for twenty five years with 600 large and no other source of income. Of course I don’t feel the need to live in Toronto or Vancouver or own property anywhere for that matter.

#36 CalgaryBoy on 12.05.09 at 1:26 am

Is this Elaine even for real??? $375 in 2005 is a good price…the only reason you’d sell is to make money,so just admit it. I can’t stand people who 1) do not take responsibility for his / her own actions 2) want people to feel sorry for you 3) make money and yet make it seem like you’re still poor and is asking for help.

#37 NLMV on 12.05.09 at 1:31 am

#16 Sid — Good advice from Sid and Garth. Rent a decent place for 12-18 months and keep your eyes peeled. Sooner or later, there’s gonna be lotsa bargains to choose from.
“. . . a steady stream of strong asian cashflows, . . .”

Nostradamus jr. is vindicated at long last. His posts are accurate, esp. with the Chinese populace being given the go-ahead to visit / live here. North and West Van. will continue to do very nicely.

Not sure if the ‘burbs will make as much progress, but as long as there is a steady influx of wealthy Chinese, with more than enough spare change to buy mansions on the spot, plunk down the cash for the gated communities they are sitting pretty.

“Fools. Success is stuff.” — This stuff? This is not living within anyone’s means; it’s flaunting, then using money foolishly, such as Imelda Marcos and her shoes.
Cults seems to be intertwined with everything else, such as curioser, said St. Gore of the Als (may have the name mixed up). “. . . There they are, in the fine print of the history of the outfit among the funders of the Nobel-lauded independent minds that supposedly certified our sanity in this madness: BP and Shell. You guessed it.” Hmmm. Do I see BP and Shell mentioned? Whatever happened to Iraq?
Facts and figures on why Reverse Mortgages are not very helpful.

#38 CalgaryBoy on 12.05.09 at 1:34 am

In the past 6 months, I’ve noticed a lot more places to rent and prices have dropped ~$200 here in Calgary. Plus, the condo market is in trouble as there are TONS of foreclosures! Most of them are shitty apartment converted condos. Hopefully, next are foreclosures on houses. Then it will be time to cash in on one. It was so sad and upsetting when it looked like there was no hope in prices dropping and that only the rich can buy and afford houses.

Then I bumped to this website and have been reading “Greater Fool” and this told a totally different story.

Soon, it will be my turn to get a place :D

Not to say that I hope people lose their homes, but to those who flipped home and drove the market up like mad should be taught a lesson.

So, now I say, keep the craziness going, keep buying, keep driving up the prices; the bigger the bubble, the more houses will be available for the average person next year.

#39 ralph on 12.05.09 at 1:45 am

Gold today took a $48 drop. Will this be the end of another gold rush?

#40 ManfredSteyn on 12.05.09 at 1:55 am

Hi Elaine,

Please disregard some of the more negative respinses to your post. We are also in Vancouver, and we also benefited from selling our house. We’re now back renting near downtown in a great condo. Walking to Granville Island, the great restaurants Downtown and on south Granville. I don’t agree with Garth and the other posters who recommend moving east of the Rockies. Blah! Life’s too short to live in a frozen wasteland, IMHO.
Find a nice rental (there’s lots out there). Ride out the crash. I see it as “earning” an additional $250,000 a year. Just think of how great it would be to buy your old house back for cheap, and have no mortgage to pay!

#41 Taxpayer like you on 12.05.09 at 2:12 am

Elaine: Dont kick yourself too hard. You got out of a 375K mortgage – that is big, don’t let anybody tell you otherwise. I also doubt you “lost” $400K of possible equity. I dont believe a 40% jump in average prices, even on the west side.

Take Garths advice – get outta town for a bit. Check out VI as another blogger suggested. Still possible to work in Van with weekly or bi-weekly commute. Dont buy there
either. Rent for time-being. Good luck.

#42 Nathan in Edmonton on 12.05.09 at 2:25 am

$375,000 is a huge mortgage for a couple in their mid 40s. Even with what you’re making. When where you hoping to have that paid off? I’d be sleeping easy with your decision, and not worry about equity that was never yours to lose.

#43 weston on 12.05.09 at 2:38 am

They had ALL their cash in their house. That’s why they had to sell!!

The fear of losing ALL that equity drove their decision.

Now, think what will happen when the market craters
and the mob starts acting the same why they did.

#44 Rob in NVan on 12.05.09 at 3:08 am

Analysing the historical trend line for Vancouver house prices indicates a steady, almost linear, rise in the value of a benchmark detached house from approximately 100000 dollars to about 400000 dollars over the course of the 20 year time span from 1980 to 2000 (see or ). Thus, in nominal terms (i.e. not “inflation-adjusted”), house prices in Vancouver inflated at a rate of about 7 percent per annum from 1980 to 2000.

To corroborate such information, Sommerville ( ) indicates an historical average per annum increase of roughly 3 percent in real Vancouver house prices (“inflation-adjusted”) from 1980 to 2005. This rate is similar to the long-term US norm of increasing at around 2 percent per year above inflation (as was determined by Robert Shiller: see page 20 and 21 of “Irrational Exuberance”). Similarly, per a 2006 TD Bank report ( ) the average nominal annual increase in resale home prices in Canada was 5.6% per annum over the 25 years prior to 2006. During that time period the average rate of inflation was 3.7%, implying that the after-inflation (“real”) increase in Canadian home prices has historically been (only) 1.9%. Vancouver prices therefore historically inflated at a slightly faster rate than Canada as a whole.

Vancouver house prices therefore historically (pre-bubble) “beat inflation” by (only) about 3 percent each year (despite Vancouver historically being similarly “desirable”, “short of land”, “attractive to immigrants”, “insert-myth-here” as it is now). Key point: even Vancouver houses have historically not been much of an “investment”.

It’s easy enough to extrapolate forward from the pre-bubble trend line and determine what Vancouver prices “would/should” be at any point in the future (hint: considerably less than now) should current prices merely “correct” and revert to tracking that line. But even such expectations are liable to be shattered with consideration of all the factors that contributed to “inflation-beating” house price trends in recent decades (let alone in the recent bubble era) . . . a key one being ever-decreasing borrowing costs (on average) over the entirety of that time period, as shown in this chart: (which, obviously, cannot be continued).

In 2006 Shiller warned, “Vancouver is the most bubbly city in the world” . . . the recent bounce-back has only confirmed it . . . consequences forthcoming . . .

#45 Boombust on 12.05.09 at 3:40 am

Shut up, Elaine.

#46 Jojo on 12.05.09 at 4:00 am

Inflate or Die,
So will die from 2011. When this bubble burst in 2011,2012 than will need recovery over 20 years.
Garth you still don’t know how to timing the market.

#47 Dan in Victoria on 12.05.09 at 4:23 am

Elaine, you’ll never go broke taking a profit.
Greed then Fear, now Greed, then…….?
Haste will make waste.
Be patient.
Do you really want to be a debt serf the rest of your life?
The government and banks love it when you must get up early, go to work, pay taxes, pay interest on fractional reserve lending, an obedient beaver is what they want, Easily controlled by debt.
Take a look at the drones around you…….

#48 SaraBeth on 12.05.09 at 6:59 am

Elaine ~

Why do you HAVE to rent a condo/apartment? There are homes for rent too… My husband and I have been renting houses for decades… both in Canada and in the U.S. Neither of us have ever owned a home…

I only WISH my husband and I had your options… We would be set for life if we had your $600 K…. But then again, we’re just simple folks, with simple needs…

#49 miketheengineer on 12.05.09 at 7:08 am


Wake up and smell the coffee. With 600g’s your dollar could buy a great place in PEI and leave you with 300g’s (maybe even an awesome place). Same Ocean View, unfortunately, the Asian food will not be as good, and their are no mountains.

With that 300’gs invested, could produce at least $1500 per month income. Garth’s buddies there should be able to get you more from your investing. With 600k in the bank, this should generate 3000 per month.

Mid Forties and 600k in the bank…..hey Elaine you could give a good donation to the food bank too. Imagine, hungry people, who have no job, poor, and on their last hope, and at Christmas, somehow, they get a box of food.

I wish I had a job and 600k right now. What a problem to have.

#50 David Bakody on 12.05.09 at 7:14 am

Elaine, Elaine, Elaine ….. bow to the East Elaine, you are the lucky one’s and have not realized it yet. I am off to Tim’s and will have more to say later.

#51 Repatriated Expat on 12.05.09 at 7:20 am

To all the high-strung, stressed-out, asset-rich bloggers on this site, verbalize the Zen mantra:

I control nothing
I own nothing

Repeat until it sinks in or until you have a heart attack.

#52 Greateast Storm Ever A Coming on 12.05.09 at 8:38 am

They’re Going to Kill the Fed
Linda Brady Traynham

Okay, Sugars, you got all that? The debt is all being loaded onto the Fed, those in the know are scurrying to invest in kukui nuts, baht chains, ink cartridges, whatever they can find that is tangible, and in the fullness of time Mary Renault will be shown right again because The King Must Die.

You heard it here first, and if you don’t get your money out of the mutuals, your CD collection, the Market, banks, and treasuries on your bottom line be it.

Well, anyone who didn’t know about the scam in time to flee with his stored value is going to take a brutal kick to the codpiece. The stock market crash and housing bubble will be regarded fondly as “the good old days.”

Anyone who expects to get a 1:1 swap for his greenbacks leave quietly now, please.

My most sanguine guess–and it is only a guess–is that we’ll turn them over for 30% of face value. And that was “sanguine” meaning “hopeful.” It would not surprise me at all if you are offered ten per cent., or even one per cent., at which point I suggest they would make great wallpaper. Those still holding traditional dollars will be exsanguinated. My bet is on the Amero, since I don’t think the coins I have seen were stamped “D” to indicate that they were turned out by the Franklin Mint as collectors’ items. There were plausible reports that China received a shipment of eight billion of them already…

#53 David Bakody on 12.05.09 at 8:47 am

Guess it’s all been said Elaine, but this you know, you are out of the house racket and have a good job, no debt and plenty of cash in reserve. Although you may pay rent, you also will be saving 100% plus on every dollar you put away as opposed to paying big bucks to everyone who lines up behind the home purchaser.

Word from Tim’s.

Bud just had his bungalow roof re-shingled to cash in on what’s his name’s housing improvement plan …. he paid $6800 and was told he got a great deal.

Friend of Bud had his bungalow re-shingled about 18 months ago same neighbourhood ( up the street) and paid $4000 plus the guy threw in his utility shed roof for free.

Need I explain once again about so called government grants!

#54 China vs Canada on 12.05.09 at 8:58 am

YIKES !!!!!!!!
Had an interesting conversation with some Chineese co-workers over here in TO temporarily.
Their housing bubble in China makes ours look like bubble gum.
They said people that got in early have become super rich. People that want a condo now have to purchase it with 3 other families. You and her, plus your parents and her parents… that’s the only way you can afford it.
He was asking me about a condo here in TO that was going for $350,000 and whether it was a good deal or not. He said the same condo in China was going for $850,000. Where in China, I didn’t ask but it was quite the conversation. I thought Canada’s real estate bubble was stratosphere, I guess not.

In China 4% of the population can afford to purchase an urban home, while here 70% are homeowners. There is no comparison. — Garth

#55 Greateast Storm Ever A Coming on 12.05.09 at 9:21 am

They’re Building a Box – and you’re in it

It doesn’t matter who you ‘elect’ at the one opportunity they give you every few years to ‘participate’ in ‘your’ ‘democracy’, if the backbenchers all take orders from the PMO, and the PMO formulates Canadian policy not with the consultation of those elected backbenchers, but in secret meetings with the people who really run Canada, the Bay St Bankers and their elite ‘investor’ cronies, and those policies all have the goal of making THEM richer and consolidating their power even further, and who cares what happens to you and your meaningless (to them) life beyond making sure you keep going to your job every day and producing the wealth they are stealing.

When they decide that they will establish a massive, and very blatantly fraudulent, national debt and use that as an excuse to slash your social programs and weaken your democracy and turn tens of billions of dollars of your tax money each year over to private ‘investors’ – does that matter to you?

When they decide to lower corporate taxes and close hospitals, rather than maintaining corporate taxes and improving the health care system – does that matter to you?

When they decide to sign ‘free’ trade agreements that will put downward pressure on your income, but allow corporations to improve their profits at the expense of every Canadian worker – does that matter to you? Does it matter that you do not even understand these ‘trade’ agreements, or their ramifications?

When they allow your currency to be subject to the whims of international currency traders rather than creating secure exchange rates, thus callously tossing the financial wellbeing of all non-player Canadians into a currency casino over which they have no control – does that matter to you?

When they decide to invade other countries as part of the ongoing American global NWO hegemony drive, whether you or most Canadians approve or not, or really understand what is happening or not (and with the added effect that the people in those countries may well, sooner or later, decide to come to Canada and blow some things up in retaliation, putting your life and the lives of your family at risk) – does that matter to you?

Your children cannot see a doctor in a reasonable time because the government decided that supporting the banks was more important than supporting your health care system – does that matter to you? People die in ambulances and waiting rooms because of underfunding while lower and lower corporate taxes provide record profits for the banks and corps year after year – does that matter?

Hundreds of thousands of Canadians depend on food banks to feed their children, because the government has decided that reducing corporate taxes and paying off phony ‘national debts’ is more important than funding social safety nets for children living in poverty – does that concern you at all?

Does it concern you that you never have meetings in which you talk about these things, so that your opinion can be heard by others, and together you can agree on whether or not you think the taxes you pay should fund wars in Afghanistan or better social support for the poor people in this country, so they have a chance at a decent future? Or even if you agree with the Afghanistan ‘mission’, does it not concern you that you have never participated in any discussion about whether or not we have a role to play in overthrowing governments in foreign countries whose policies someone doesn’t agree with – and even if we do decide to take a role, should that role be military invasion or something else? Does it concern you that ‘your’ media never talks about these things, never suggests the people ought to have a bit more of a role in ‘our’ country?

Well, if you are really a Canadian citizen and not one of the new breed of tv-couch-potatoheads, then of course these things matter to you – but if you think about it at all honestly, you have to admit that as a citizen in what is called Canadian ‘democracy’ in the opening years of this millennium, you have no meaningful say in these decisions, or anything else of any importance, really.

These things certainly should matter to you. If you think that even if what I say is true, but you still have a pretty good government and country, and things are not so bad that you can’t live with them so do not protest them – think about what is going to happen someday soon when they really do go too far, and you really want to protest – you will have no voice then, only police batons and pepper spray in your face, and the demands for you to obey the ‘lawful’ police orders of ‘Citizen do as you are told!!’ – as you have always done before, or told others to do. And they will say that nothing has changed, you have the ‘same’ voice you had in times past when you did not protest.

And that voice is – No voice beyond a supplicatory one, that the masters can refuse at will because they have always done as they have pleased and you’ve never complained before. No right to change anything because by your actions over many years you have waived all such rights you may have once had, or thought you had. All that is left is the ‘right’ to do what you are told.

And that, they will tell you, is democracy. The same ‘democracy’ you have always accepted, so have no right to complain about.

Well, I’ll leave it at that, although I could go on. If you’re happy or at least not bothered enough to complain about being treated like a powerless child in your own country, I doubt you would have read this far in the book.

But even while that might seem to be enough reason to get away from the tv and start thinking about retaking control of your country, it is not all.

#56 Herb on 12.05.09 at 9:25 am

Off topic, but about to bite … the HST!

Unaccustomed as I am to praising The Ottawa Citizen, it does offer a very good exposé of the HST in to-day’s “Saturday Observer” section, with further instalments to follow over the next three days. Access at

The quote that says it all: “According to the Chamber of Commerce, harmonizing taxes would lead to a more competitive, richer and happier province.” (From And so it will, for all those who are able to recover the tax they pay from the level they sell to. Unfortunately, this happy daisy chain stops at the last link, the consumer. He will get a portion back in reduced income taxes, not to mention the lower prices that will result from the taxes saved by business. The whole thing will be “revenue neutral”, IF you believe in Santa Claus or the probity of government.

You see, Chill’un, business must have tax relief because they have been passing on the taxes they pay to their customers, so if the customer pays the whole shot at the end, he’ll pay less in the stages in between, because business always passes cost-cutting improvements on to the customer, right? And business deserves special consideration because it is in business to produce jobs, not profits.

And the reason for introducing the HST now? The recent financial crisis, forcing Premier McGuinty to ask earnestly: “[W]hat are you prepared to do to ensure there are good jobs for your kids?” Disaster Capitalism, anyone? He should have added “We’re government, we’re here to help you.”

#57 knucklewalker on 12.05.09 at 9:30 am

Elaine and her ilk may well end up on slave chains in the next 20 years let alone reaping rewards for their wise investment decisions.

We will not see $100.00 oil again except as a spike phenomena. We are past peak oil…demand destruction is now in full control…the PERMANENT spiral DOWN of the world economy has begun.

Canada is SCREWED, we high graded our petro resource and we are now into the dregs at the bottom (tar sands), manfacturing will never recover in the USA now as their little hyperinflation starts to run…..therefore forget NG being worth much also (40-60% of all NG is used for manufacturing stateside).

Our so called rich country full of natural resources will stay full of natural resources that CANNOT be sold in a world wide full on hyperinflationary (to start with) greatest (and final) depression.

We are finished and are to damn stupid to even know it!

I feel not much except contempt for Elaine and her types…her money will soon be lost….even advice on here is laughable…invest in cheaper urban real estate somewhere outside of North Van???…yeah ya’ll do that….you might as well because the skill set required to survive (let alone thrive) in the very near future will not be those that “real estate” speculators possess.

#58 China vs Canada on 12.05.09 at 9:48 am

“In China 4% of the population can afford to purchase an urban home, while here 70% are homeowners. There is no comparison. — Garth”

That 4% is more then the total population of Canada. lol

Exactly my point. A condo in Beijing should be $8.5 million if Canadian logic were applied. There is no comparison. — Garth

#59 Toronto C9 Renter on 12.05.09 at 9:55 am

Garth, great post. My favorite part is your simple (but I think profound) advice — “get out of town for a week and gain some perspective”

This is so true. Doubtful any sane person would lay down serious cash in Vancouver if they had experienced the comparable prices for excellent homes in places like Texas, Arizona, Florida, Nova Scotia, South Carolina, parts of California etc etc.

#33 Watched Bubble Never Pops on 12.05.09 at 1:00 am

“However, this assumes that the investor stood by as one of the biggest buying opportunities in history came by and did absolutely nothing”

Jim, your “newsletter” says you lost 33% in 2008. This means you needed 50% this year just to claw back to zero. Did you achieve that, and if so how?

If not, what are you bragging about?

If yes, that sounds like active trading (i.e. anticipating the future which you claim is foolish), not buy and hold.

So which is it?

#60 China vs Canada on 12.05.09 at 9:59 am

“Exactly my point. A condo in Beijing should be $8.5 million if Canadian logic were applied. There is no comparison. — Garth”

Sorry, you lost me on that logic.

Keep searching. — Garth

#61 Peter Wiener on 12.05.09 at 10:36 am

Reread this “Elaine” posting as it is a very timely and cautionary tale.

In it you will find a perfect illustration of the mentality that is adopted in a mania or bubble market regardless of the item / investment/idea having money spent on it.

Think about it.
Combined gross income of 150 K – they couldn’t save 600K in 17 years maintaining a normal (for Canada)living standards, yet they are prepared to BELIEVE that others, who on average make half their income, will be able to continue to purchase houses with hugely out of whack income / purchase price ratios.

This is only one of the delusions that most purchasers have today and from what I am witnessing, it cuts across all income levels, save the truly wealthy.

The resolution of this ‘Great Delusion’ can only end in serious troubles for individuals or Canada or both.

Elaine, read some history and do a little research for your gains, or as Tony in # 19 alludes to, you’ll give it all back and maybe more.

You were fortunate and life handed you a lovely gift of good fortune, you just don’t realize it yet.

#62 AJ on 12.05.09 at 10:39 am

Elaine- Greed makes you sound fat.

#63 dd on 12.05.09 at 10:40 am

#55 China vs Canada

A chinese co-worker said that families are paying 10x earnings for condo’s in larger coastal cities. He said it is expensive.

#64 My_view on 12.05.09 at 10:51 am


Great post, although I sometimes disagree, todays post was absolutely brilliant!

#65 Piccaso on 12.05.09 at 11:47 am

Elaine just go hide out down here until the euphoria is over

Las Vegas, NV 89108
1 Bed, 1 Bath, 685 Sq Ft–Sue-Ct-104_Las-Vegas_NV_89108_1114245702

#66 Cory on 12.05.09 at 11:51 am

I agree with all of the logic on this blog as I have been saying these same things for several years now. Sure we saw a blip downward in 2008 but I think there is just too much political will to keep things afloat here and it seems they will stop at nothing to do so.

Banks post incredible earning this past week and they think everything is rosy because of it. They leave out the part where the CDN gov’t bought 60 billion worth of mortgages from the banks early this year to achieve this.

The logic of a collapse seems, well, logical and it should be. The problem is, our “leaders” are not logical.

In response to the gold boom is over comment simply because of a one day expected drop in the POG, don’t get too excited. It has only just begun it’s move.

#67 X on 12.05.09 at 11:53 am

61 – think supply and demand and you will get it.

#68 Piccaso on 12.05.09 at 12:02 pm

Or this one has a pool…

Las Vegas, NV 89149
1 Bed, 1 Bath, 700 Sq Ft

#69 BDG YYC on 12.05.09 at 12:05 pm

A lot of bitterness and resentment seems to ooze out of the darker recesses of this forum, and more than enough folks looking forward to “the great reckoning” and their wonderfull opportunity to get even on some level with those stupid undeserving bastards whom they seem to percieve as somehow having stolen thier opportunities. Twenty somethings cranky that relatively fresh out of school they can’t buy the house they so richly deserve the immediate right to. Fortysomethings who for whatever reason, able or not, didn’t get in ten years ago with all the other thirty somethings of the time and are looking forward to their do-over opportunity. And the just plain miserable. Yup … much gleeful anticipation as folks look forward to what they seem to hope will be their great opportunity to cash in when hell arrives with all its bounty.

And … of course there is a very good chance they’ll get their wish. Yup … can’t wait to see their bastard friends and neighbours go under. Have to wonder if these are just good old asperational hopes and wishes for thier personal better fortune (perhaps pooly expressed) or just an honest expression of bitter and hateful resentment.

I suspect that these people will indeed get what they are wishing for. I also suspect that when TSHTF many of these folks are going to find themselves sitting in the very same box albeit in a nastier place populated by very many more people feeling cranky and out of sorts, with, in very many cases, very good reason for being so. I somehow also suspect that this little collection of mean spirited souls won’t be faring as well as they presently expect. Nope … you still won’t be normal … even in the new normal. But you will likely get the chance you’re hoping for – to be able to tell all your bastard neighbours and frinds what assholes they are and how you told them so. But alas … even after they’ve gotten their comupins and they’ve been brought all the way down … you’ll still be pissed off because they still won’t have sunk to your level.

Seems somehow a lot of folks seem to think they are going to wake up one morning to a new and wondrous land of fresh opportunity … that house they covet will be half price and theirs for the taking … happy days!

I suspect though that reality is going to deliver a long, grinding, miserable road, and that one way or another it’ll be years in the making … and a seeming eternity for this ilk to get to where they think they are going.

No naming names – pointless anyway. Sadest is most of these folks will be wondering who the hell this little blurb is referring to.

There is a great deal of hardship being experienced right now by many of our friends and neighbours even though much is being hidden from public view. There is likely much more to come before it becomes evident.

By the way … we’re entering a particularly sensitive seasonality window here … for the technically inclined … might not hurt to invest a bit in an appropriate spirit …

Its only prudent to plan and position to protect ourselves against the risks that may emerge, and yes to look to take advantage of opportunities that could emerge. That said, losing sight of the human impacts of what is being discussed on this site … that are and will be tragic, seems well… . Further … untill all is done … its a bit early in the game for being too smug … few here I suspect are beyond risk … and there is likely plenty of hurt to go around … and a blind card or two that nobody has thought about could deliver a blow to anyone – including meeeeeeeeee … unfortunately.

The bad ending being pondered here could just be of the never ending variety. Or seem like it anyway.

My apoligies, to the large majority of the posters here for the longish rant.

Luck to all !!!

#70 bsallergy on 12.05.09 at 12:18 pm

Our selfservative government in Ottawa has chosen to blow up a huge real estate bubble in an attempt to prove itself a good steward of the economy. Fool the canadian people into feeling rich and they will vote selfservative. Tell the canadian people that they too can have a free lunch a la american and they will vote selfservative.

#71 Gord In Vancouver on 12.05.09 at 12:18 pm

As of now, 65 replies have been posted and only one of them (#38 NLMV) comes close to saying that Elaine should put her $600,000 back into Vancouver’s real estate market.

a steady stream of strong asian cashflows

Until we objectively identify the percentage of gimmick (e.g. 5%/35 year, 0/40 year, flexible rate) mortgages that were recently applied to Vancouver home buying, we cannot confirm that wealthy Asians (most likely cash buyers) are the market’s primary catalyst.

Vancouver renters can still afford to buy smaller (e.g. <=500 sq. ft, $160,000) apartments in the suburbs. If wealthy Asians were entirely behind Vancouver's market rise, these buildings would be out of reach to the middle class too.

#72 kc on 12.05.09 at 12:20 pm

62 Peter Wiener

“This is only one of the delusions that most purchasers have today and from what I am witnessing, it cuts across all income levels, save the truly wealthy.”

When I read your comment, this article popped into my head about bubbles. Nice little read written a few days back.

Dubai Fiasco Shows the True Nature of Bubbles

#73 Colin on 12.05.09 at 12:21 pm

Looking at the Canadian system more closely, all five Canadian banks are levered at an average of 31:1, which is actually the lowest leverage ratio during the three years that we reviewed. This implies that if the Canadian banks’ tangible assets were to drop by 3%, their tangible common equity would effectively be wiped out. Now, that doesn’t mean they would go bankrupt per se, but it does give us an indication of how little asset prices would have to decline in order to wipe out their tangible common equity. These leverage ratios worry us because they leave such a razor thin margin for error on the ‘tangible asset’ side of the leverage equation. We are always cautious about investing in companies that have zero or negative common equity – we’ve seen what happens to public companies that trade at those levels, General Motors being a good example.

Acknowledging the leverage levels above, you may wonder how the Canadian banks escaped the 2008 meltdown unscathed. The answer is that they received significant assistance from the Canadian government. First, they received $65 billion in liquidity injections from the Insured Mortgage Purchase Program (IMPP), whereby Canada Mortgage and Housing (CMHC) purchased insured mortgages from Canadian banks to provide additional liquidity on the asset side of their balance sheets.7 Next, the Bank of Canada provided them with an additional $45 billion in temporary liquidity facilities. Finally, a Canadian Bank (that shall remain nameless) also received assistance from the Canada Pension Plan (CPP) through the purchase of $4 billion in mortgages prior to the IMPP program, for a total government expenditure of $114 billion.8 For reference, the entire tangible common equity of the Canadian Banks in 2008 was $68 billion. Can you put two and two together? The Canadian government injected a sum through mortgage purchases worth more than the entire tangible common equity of the Canadian banking system! On top of that, the Bank of Canada provided more than 50% of the tangible common equity of the system in emergency liquidity facilities. Mark Carney, Governor of the Bank of Canada, acknowledged this, albeit in an indirect way: “Policy-makers had to do many unpalatable things to save the economy from the financial system – a financial system that begged for mercy.”9

#74 Ian McDonald on 12.05.09 at 12:33 pm

What’s the difference between 250k and 500k?
500k and 1000k?
1000k and 1500k?
A percentage difference.
At what level of the game are you playing?
With tax deductibility like the SM, bring back the capital gains tax for residential real estate.
Clearly, residential real estate, including a primary residence,
are being used and traded as a commodity with no tax consequences and are no longer just a place to live for shelter.
Also no-one is pricing in ‘risk’.
Foreign Exchange
Interest Rate

#75 Ret on 12.05.09 at 12:35 pm

Elaine- I only wish that I had your “problem.” So you got a cool $1M for a 375,000 pile after less than 5 years. People can ask 1.4 M but is this just Olympic hype or are houses actually closing for these prices? How many buyers qualify and are willing to pay $1.4 m for a $375000 home after less than 5 years. I sense more shinola than shine whenever I read about this Vancouver real estate market. Keep your powder dry and don’t buy in too soon when the crash comes. Let the speculators twist in the wind for a while.

#76 Piccaso on 12.05.09 at 12:55 pm

Elaine with your $600,000 you could buy twelve SFH’s in Las Vegas.

#77 Another Albertan on 12.05.09 at 12:56 pm


In regard to Talisman, my understanding was 220 employees and somewhere between 65 and 80 contractors, principally on the same NG business side. Of course, that’s never reflected in the published numbers. In reality, the number of workers immediately affected is 25 to 35-odd percent higher.

#78 TJ on 12.05.09 at 1:02 pm

Of course, I have to admit to being totally biased. Garth Turner has been a major influence.

I want to talk about Vancouver for a second and I want to preface this by saying this City is by any stretch one of the prettiest and at the same time, most delusional place on the Planet.

We used to call it Lotusland.

I don’t know when this City started to descend from a bucolic and rather sleepy Port, to this hyper caffeinated ‘World Class” (*gag) Super City by the Sea – but a lot us disgruntled point to Expo 86 as a main culprit.

We started to get full of ourselves and tried to forget the 65% crash of the Real Estate market to start the Eighties and talked about how Vancouver this, and Vancouver that.

The Downtown East side slums, that rival Kolkata, and the happy days of the Hells Angels and the Viets and Triads are ignored – party on, dude.

The quality of the Coast life has morphed into a High Rise ‘Potemkin Village’ of overpriced ticky tack, that 20 somethings think are a steal at $500K.

The Freeways that were built in 1955, are a bumper to bumper nightmare and don’t get me started about the burgeoning gangs, guns, id theft, illegal immigrants, and poor souls lying on heating grates.

Wake up and smell the coffee – we have turned Vancouver into our warped image of what a “Big City” should be.
There are UNDER a million people here in the City proper – you cannot have MEDIAN homes at
$750K – unless you want to start a shuttle service for the ‘staff’ at barracks in out in the ‘cheap far suburbs’…like they had in Dubai.

That is, until someone woke up one morning and realized it was all built on sand.

Vancouver is built on blind, stupid, dumb, illogical animal spirits, and it’s about to get what it has been cruising for – and a lot of ill-informed, or greedy people are going to be dancing to a new band – and the theme song will be “….Brother, can you spare a Hundred K?”….

#79 omg on 12.05.09 at 1:11 pm


I am surprised at the number of people critical of you – what a bunch on morons.

I am in somewhat the same boat as you – sold in 2006 when prices in Vic were at a ridiculous high – how much more could people pay for a bungalow in a small city? But people were will to pay more and I watched as prices have climbed nother 20%.

I am renting and even at $2000/m for a nice little housing in Oak Bay it still cost much less thatn owning.

The market will reset, whether in 2010 or 2012 or 2014, who knows. Keeps your powder dry and buy a few rental condos when the marker resets and be set for retirement.

#80 McLovin on 12.05.09 at 1:17 pm

Wow there are a lot of Wacko’s on this blog!

Please consider the following:
1. Perhaps Elaine does not want to move out of Vancouver. Not everyone is interested or able to uproot their families and move 4,000 miles away
2. The pursuit of profit is not greed in my books. I think Elaine did the right thing based on the facts. I don’t know why so many of you are getting on her. I highly doubt you same people would consider someone who bought gold at $300 and sold it at $800 (because they thought it would go down) greedy.

Elaine, my advice for you would be to sit tight and just wait for fundamentals to reassert themselves. I am more convinced than ever that Vancouver is in big big trouble!


#81 Gordon Gekko on 12.05.09 at 1:21 pm

Greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind.

#82 S on 12.05.09 at 1:27 pm

Everything is relative. Some of the posters here seem to think that $600K is a lot. To many people it is. Those who have invested in themselves, who took the time to acquire good education or took the risk of building their own businesses and have – as a result of their hard work – prosperous careers realize that 600K is not a great deal of money. Those are usually self employed individuals who contribute the most in taxes while not being covered by the social safety net that they fund. No subsidized healthcare or childcare, no employment insurance, no welfare services available and no company pension plan. And all that as they continue to fund those services for their employees. I could go on here but why bother. I can already predict the response… Enough to say that there are thousands of “Elaines” in Canada, most of whom acquired their assets through hard work, others through wise investing and relatively few through shear luck. Those people have a real reason to be worried. Rather than being rewarded for their prudence they are being penalized by artificially low interest rates and government aided bubble building. And no, moving to a small centers – the proverbial boonies – is not a real option for those who want educational opportunities for their children and professional possibilities for themselves. Canada is just not built that way.

#83 CM on 12.05.09 at 1:35 pm

Analysis from Kevin over at Edmonton Housing Bust on why low interest rates did nothing to stop the real estate bubble from bursting in Japan…

#84 HouseBuster on 12.05.09 at 2:01 pm

#33 Watched Bubble Never Pops

How quickly your forget the Nasdaq and Nikkei

Nikkei ~1990 it was at 39,000 – today, almost 20 years later it is at 10,000

Nasdaq ~2000 it hit 5,200 – today, almost 10 years later it is at 2,194

How’s that for buying the dip???

#85 omg on 12.05.09 at 2:28 pm

#79 Hey McLovin

Give the wackos a break they are all hyped up on the nano particles in their blood from the H1N1 injections.

#86 kc on 12.05.09 at 2:32 pm

I am still waiting for the …

“Any scrap of advice would be graciously appreciated..regardless, I will tell my mom we’ve “talked!”

Thanks so much and take care, Elaine.”

rebuttle letter where she comes back saying… ohhh I wasn’t expecting you to publish my tales of whooas’me… how unfair the blog dogs are… What did you really expect? To the others in here that can’t decide what to do after you have made oooodles in the RE elevator… here is a opening from a thread i linked to above…

“At particular times a great deal of stupid people have a great deal of stupid money… At intervals, from causes which are not to be the present purpose, the money of these people – the blind capital, as we call it, of the country – is particularly large and craving; it seeks for someone to devour it, and there is a ‘plethora’; it finds someone and there is ‘speculation’; it is devoured and there is ‘panic’.” – Walter Bagehot, 1826-1877, editor-in-chief of The Economist

(waiting patiently for the next updated letter)

#87 jeffd on 12.05.09 at 2:46 pm

If anyone ever wondered about whether the Vancouver bubble can sustain itself, this email answers the question. No. Because people in Vancouver don’t understand their own market.

Cashing out for a million is a very smart move. Sure, you could have done better, but anyone who trades stocks knows this is perpetually the case. Wanting to get back in now is a really really really dumb move. If you just pulled 500K+ equity out of real estate, that’s a massive profit considering 150k a year pre-tax income. Invest it conservatively and wisely, and sit on your nestegg. You can rent for years, decades in fact, off that equity, so why would you go risk-hunting, during such uncertain times, when you have so much going for you financially? Pure hubris.

#88 Live Within Your Means on 12.05.09 at 2:50 pm

#141 Dan in Victoria on 12.05.09 at 3:54 am
Post 135 Live within your means,Unfortunately you have taken my post out of context, I made a point of explaning that there was no critism of YOU or what you had done, again I say that. My comments were not about that.

Sorry if I came across like that Dan. I did not mean to. BUT, you did not answer my question about the percentage that renovators make on purchasing all the fixtures, tiles, etc.

One of the reasons that my husband wanted me to make those purchases was because I take a long time to decide (I’m a Libra :-). If we had a contractor buy stuff for us, I’d have to make ‘almost split second decisions” which I don’t like to do. I like to do lots of research. We shall be replacing most of our windows and siding next spring. During the winter I shall be visiting all of the companies in my area and doing a comparison on their products – ER values vs cost, etc. I’ve already checked the Nat Resources and other sites and, if feasible, will take advantage of the Fed and Prov. rebates. Before I wretired I was a business analyst.

No offence taken Dan, but would still like to find out the percentage that contractors make on those purchases.
Also, what’s the going hourly rate for some of the trades people where you live.

My husband spent all day doing the plumbing for our shower downstairs. I worked with him for an hour. Its our time and I can assure you it won’t leak and is probably as good as, or better, than a plumber would do. I do realize, however, than time is money for trades people. BTW, I’m a big fan on Holmes on Homes.

Best wishes Dan.

#89 Joseph on 12.05.09 at 3:01 pm

Garth, I think your bloggers sometimes need to take a step back and take a deep breath. In my opinion, Elaine has asked an honest question and deserves an honest answer. Having your blog dogs tear her apart just because she has $600K and can live some place else comfortably with that kind of money is not the point. THEY WANT TO LIVE IN VANCOUVER. They are NOT greedy anymore than the average blog dog on this post is greedy if they have $80K leftover as a result of a recent home sale in an Ontario suburb and are now priced out of the market and someone from Newfoundland writes and says “Pity you. I only wish I had $80K. Move in my town and you can buy a mansion for $100K” They don’t get it. Elaine and her husband have put themselves in an awkward position but still likely want to live in Vancouver because that is where their roots and jobs are, and they love the city and have called it home for 40+ years. Can’t just pick up and leave all that behind in a flash. Not all these letters are spin. GHEEESH…

#90 Taxpayer like you on 12.05.09 at 3:24 pm

73 Ret (and a coupla others)

Elaine doesnt say the house cost $375K. That was the
size of the mortgage.

Maybe she could enlighten us on what they paid for the house.

#91 GregW.,Oakville on 12.05.09 at 3:34 pm

Hi Garth, FYI re: climate change story/radio info show

CBC radio, Quirks & Quarks, Dec 5

The Rising Seas.
‘ but the big concern, and the big unknown, is what will happen with the great ice sheets of Greenland and Antarctica. Recent observations of these ice sheets have suggested that, in response to warming temperatures, they are losing ice faster than ever before.’

#92 kc on 12.05.09 at 3:39 pm

#87 joseph

re-read her letter, in places she comes across as pompous and self serving, and on top of that states her own conclusions. “oh how depressing to rent” “lost equity” blah blah blah…. If as she states, follows this blog and her family “quotes” from here…. isn’t there something LOST in the translations?? And I also agree where you said she wants to live in Van, however, if you decide to live there pay the piper is what I feel the blog dogs are saying.

BTW, #76 TJ & #26 chaostrology, good posts

#93 Ronaldo on 12.05.09 at 4:13 pm

#86 Live Within Your Means – three cheers for you and your hubby. Every hour you work yourself is money in your pocket. You two will have no problem surviving the coming hard times. If you recall the early to mid 70’s you will know what I mean. What has happened so far in the past couple years will look like a Sunday school picnic to what is coming down onus in the very near future. Keep up the good work Garth. By the way, great photograph.

#94 David Bakody on 12.05.09 at 4:14 pm

80 S on 12.05.09 at 1:27 pm

Easy bye/gal …… less than 4% of words population
(5 1/2 Billion) can put their hands into their pockets and pull out any spare change! Also if the world’s 500 riches people on the face of this earth parted with only 10% of their wealth not one person on this earth would go hungury!!!

Now you tell me $600K in the bank with no debt and full time well paying jobs at age 40 is nothing!

Good homes in may very good areas are plentiful for 250K or less across this land and they could work for less pay and still bank money and who knows with experience they may make even more.

Silly silly bye/gal if you want to play and live the rich be prepared to give up your soul to the devil (Taxman) because they are coming.

For others who understand …. story time …. many here in NS had ocean front family property even in Coves with family names …. they refused to sell to keep it all in the family …. along came re-zoning laws and the taxes skyrocketed over night even to the point they had to move themselves …. even out West long time farms hit the auction block …. So you think you can live in a million dollar home? wait till it hits two million and mill rate rise or assessments or worst both!

Even money in the Caribbean shut out the working class who thought they could play with the big boys.

#95 Gord In Vancouver on 12.05.09 at 4:27 pm

Thanks for the post, Garth.

Vancouver’s market is a weird beast indeed. After the dust settles, those who expect a repeat of 2004 to 2008 values increases will be deeply disappointed as will bears who are calling for a 50% correction.

You answered Elaine’s question about as well as you could.

#96 Jaeyon on 12.05.09 at 4:48 pm

I just retired to Campbell River from Vancouver. Most houses are under $300K with many having ocean views. Many pros to living here:
-exact same weather as Vancouver
-skiing 45 mins away
-medium size hospital
-home depot, walmart etc.
-gateway to the outdoor

Pocket your $700K & get over here!

#97 confused and a little crazed on 12.05.09 at 5:38 pm

58 # asia vs canada

if you compare population density and value of currency we in canada do not justify the high prices in vancouver

i think he meant if we had the same population density and we were in a comparable bubble we are now property will be up to $8.5 million condo wise

确切地! — Garth

#98 TaxHaven on 12.05.09 at 6:10 pm

For public education purposes: Gold will be money long after overpriced Vancouver RE, paper currencies, barrels of oil, Canada Savings Bonds, stock certificates, cheap mortgages, and the cheap zinc-clad steel tokens in our wallets are a bad memory…

#99 palebird on 12.05.09 at 6:29 pm

I really don’t understand Vancouverites, I lived and worked there for seven long years and except for the occasional brilliant day in the summer could not stand the weather…like living in a swamp.. boring nightlife compared to so many other places..and boring people..if you want to live somewhere nice there are so many choices in this world that completely blow Vancouver off the map..Vancouver’s claim to fame is it has the mildest winter in Canada..who cares..nobody came to Canada for the weather in case you were wondering so to say that they have the best of something nobody gives a damn about is..ridiculous..oh I know, many friends and relatives harp about how they have it made living in the Canadian rainforest and it could not get any better..that is because they have not been anywhere and know not what they are missing..poor lost souls..

#100 S on 12.05.09 at 6:47 pm

#92 David Bakody on 12.05.09 at 4:14 pm

While $600K is far from nothing (and nowhere do I say it is) it is not nearly as much as one who doesn’t have it may think. I would suggest that, at least in Canada, anyone with good work ethic and discipline can have a very good life, regardless of their background. I check on this blog from time to time and all too often find that those who managed to save a little coin get “beat up” for what usually is nothing else than reaping the rewards of their own diligence. I suggest that many (notice that I did not say all or even most) of those who are in their mid forties and do not have much to show for in terms of material equity have probably neglected their education or professional development in favour of more immediate – albeit short lived – rewards. Those who were more forward looking paid their dues “up front” and are now in better position. Simple thing: live it up when you’re young then pay the piper later or apply yourself when you’re young and breathe a little easier in your middle age. What can I say kids, you can either enjoy the bush parties, snowboarding trips or toking behind your neighbours garage or you can get ready for those final exams that will get you into the university or college of your choice.
The point I was actually trying to make (post 80) was this: a self employed expert in his/her field (and I know highly skilled tradesmen, not just the proverbial doctors and lawyers, who have done this) can put away $40K to $60K per year. That would include the RRSP contributions, as well as any money not withdrawn from the corporate account. After a decade and a half of prudent living the net worth of such individual would exceed $600K. Now ask yourself, is this person more deserving of resentment or respect?

#101 Grantmi on 12.05.09 at 7:13 pm

So PaleBird.. where have you lived that you’re so cultured and rate Vancouver???

I’ve lived in a ton of places and visited as many more… and sorry! You’re out to lunch. Vancouver IS one of the nicest places on the planet.

Not only that. When I tell people where I’m from around the world… the first thing that comes out of their mouths… is .. “WOW! We were there for a visit.. and it’s the most beautiful place ever!!”

#102 David on 12.05.09 at 7:22 pm

That was certainly an interesting letter. Having said that, people who bemoan financial losses for being able to suck air into their lungs and having a recordable pulse by virtue of property ownership should give their heads a shake. Time for reality check Elaine. Being able to fog a mirror does not entitle people to abnormal tax free returns. People like this who kvetch about their great housing misfortunes make me sick, take your $600K of unearned income and hide it in some dark body orifice of your own choice. Boohoo that the house you wanted is now $400K more expensive. Too bad! See what it is like to lose a middle class paying job or see what it is like to be a member of the honorable working poor that can barely fill their stomachs in the wealthiest country in the world.

#103 Peter Wiener on 12.05.09 at 7:42 pm

# 62 AJ

Great comment – especially to a 40-something woman!
I’m still laughing at your comment as I watch the girlfriend fume at my amusement.

Yopu go bro!

#104 jess on 12.05.09 at 7:45 pm

The Repo Time Bomb Redux
Friday, 12/4/2009 – 12:21 pm by Henry Liu

“The repo market is the biggest financial market today. Domestic and international repo markets have grown dramatically over the last few years due to increasing need by market participants to take and hedge short positions in the capital and derivatives markets; a growing concern over counterparty credit risk; and the favorable capital adequacy treatment given to repos by the market. Most important of all is a growing awareness among market participants of the flexibility of repos and the wide range of markets and circumstances in which they can benefit from using repos. The use of repos in financing and leveraging market positions and short-selling, as well as in enhancing returns and mitigating risk, is indispensable for full participation in today’s financial markets. … … Unless the repo market is disrupted by seizure, repos can be rolled over easily and indefinitely. What changes is the repo rate, not the availability of funds. If the repo rate rises above the rate of return of the security financed by a repo, the interest rate spread will turn negative against the borrower, producing a cash-flow loss. Even if the long-term rate rises to keep the interest rate spread positive for the borrower, the market value of the security will fall as long-term rate rises, producing a capital loss. Because of the interconnectivity of repo contracts, a systemic crisis can quickly surface from a break in any of the weak links within the market. …”

“… Mortgage-backed securities are sold to mutual funds, pension funds, Wall Street firms and other financial investors who trade them the same way they trade Treasury securities and other bonds. Many participants in this market source their funds in the repo market. … … In this mortgage market, investors, rather than banks, set mortgage rates by setting the repo rate. Whenever the economy is expanding faster than the money supply growth, investors demand higher yields from mortgage lenders. However, the Fed is a key participant in the repo market as it has unlimited funds with which to buy repo or reverse repo agreements to set the repo rate. …”

#105 WaitandSee on 12.05.09 at 8:35 pm

Hi there,
I would like to get the link/source of :
“In 2006 Shiller warned, “Vancouver is the most bubbly city in the world”

#106 Daystar on 12.05.09 at 8:50 pm

This is the part in the letter where Elaine lost me.

“I dont want to lose out on equity and our lease is up and what the heck do we do next? We are mid forties, our combined income is about $150,000 and we have about 600,000 to put down, luckily no debt otherwise. The thought of going to a cramped condo after living in a nice home is depressing not to mention the resentment over the mountain of equity we lost.”

Time for some unsolicited advice, Elaine.

You bought and sold a house making $600,000 in less than 4 years and you stressed over lost equity? Frustrated because you didn’t hit the big peak? (so many are filled with glee when they hit the top value as a seller with absolutely no thought whatsoever to those who bought at the peak and what happens to them, don’t they?) Frustrated because it still costs 1.4 mil to buy back into the equivalent for just a little while longer, a timeline that can be measured likely in months instead of years before prices spiral hard? Huh? Am I missing something here, or are you a person that simply can’t be pleased.

And of lost opportunities… Elaine, since Oct 08′, real estate hasn’t even been the big score. All the while, while real estate began to re-inflate from March on with the crash of interest rates, the markets have been on literal fire but thats besides the point.

I’ll just get right to it. By all means correct me if I’m wrong but otherwise, how many million will it take for that full feeling… life must be tough. Who would want to go back to condo’s after such a rough experience you’ve just went through, your so poor.

Try gaining some perspective is right. There’s a ton of people I know in their 40’s and 50’s living from cheque to cheque. Still. When you look around and take a serious look at how others are living Elaine, how others who didn’t borrow to own are still worth nothing now, try at the same time putting yourself in their shoes and when you do, when you wear those shoes and hats, you’ll know why I”ve been hard on you and I offer you this advice.

You struck it rich flipping a house over a 4 year period which made you $600,000 and its a one hit wonder in Canada in terms of how you did it, but… what in the world ever made you think it can’t happen again? Think. If its real estate, try another nation. Homes are cheap in Arizona, Florida, Cal… and what of making money outside of real estate ventures? There truly is more than one way to skin a cat. All I ask is count your blessings and don’t dismay if it wasn’t “the big score” and honor, by the way, where it came from, always.

You want to get rich? Really rich and still sleep at night? Fill a need. It really is that basic. Then and only then will you have that full feeling you’ve been looking for.

Good luck!

#107 What's A Dictionary? on 12.05.09 at 8:51 pm

“In my family you, my dear Garth, have demagoguery status!”

Has no one here heard of a dictionary? Or mastered 6th grade competency in the English language?

“Demagoguery status”? Isn’t that what Sarah Palin is striving for? You betcha!

#108 Another Albertan on 12.05.09 at 8:59 pm

#103 –

April 26, 2005.

ROB TV/Globe and Mail.

Cited here:

#109 45north on 12.05.09 at 9:18 pm

-Elaine lives on the West Side of Vancouver, west of Arbutus street, south of 25th ave.
-Her car is a brand new Volvo wagon, the other car is an Infiniti.
-She has 2 children, maybe in one of the private schools in the ‘hood.
-They are club members
-Elaine is a great mom
-The children are ear marked to attend any university that they choose.
-The sense of community and belonging that Elaine experiences on a daily basis is not to be believed. She belongs to an exclusive social set that is usually handed down from parent to child, to be rooted in this community is something of value.
– The ultimate disaster for Elaine would be the wrong postal code.

sounds right!

#110 palebird on 12.05.09 at 9:27 pm

#99..buddy I have lived on all continents and visited/worked in many countries on said continents.. and I have lived in all provinces except the maritimes, yeah I get around and people who think they live in the best place in the world, well that is just about everyone, cause every place in this world is home to somebody..which is why smug Vancouverites really make me gag..think what you like but keep it to yourself cause I don’t want to hear it..I love BC but Vancouver you can keep it..

#111 beauty in lala land on 12.05.09 at 11:09 pm

So Rob in N Van, how is life in N Van? I have always thought Vancouver purchase prices and rents are crazy, but North Van seems to be have a little more value for $$. Vancouver is certainly not San Francisco but seems to be about as expensive. Makes no sense, and the wages generally are not great.

Low Budget (Kinks) blasting in background ….. I will ride out the RE roller coaster on the west coast. I have lived in many provinces in Canada and would live nowhere else but the west coast cities now, with frequent forays to warmer winter climes. I have had a nice return on my modest home on Vancouver Island, and have personal reasons for wanting to live in or near Vancouver. It will be interesting to see what happens post-Olympics.

#112 unbalanced on 12.05.09 at 11:32 pm

#92 – Dave

What yoy mean by ” money even shut out the working class?”. Thanks in advance.

#113 Fool me once... on 12.06.09 at 1:40 am

Folks, we get too wrapped up in personal feelings on where people want to live. You can’t argue the fact that for what ever reasons, people like to live in Vancouver. It doesn’t have huge job opportunities. If you do have a career, you’re not making more than elsewhere in Canada. It has a much higher cost of living. Buying a home is ridiculously expensive, actually has been for many years now. Yes it rains more than average. So why is there so much migration to the west coast? My wife made the move because she felt after all the reasons I listed, it was still the nicest place in Canada to live, in her opinion. One by one many members of her family are doing the same. It doesn’t mean it’s for everyone, but there sure seems to be alot of people who think it’s worth packing up and moving to.

#114 Pat on 12.06.09 at 1:58 am

#98 S,

The $600k in question is outside RRSP. Accumulating that much cash outside retirement funds by mid 40’s is not as easy as you make it sound. I am not aware of any of my colleagues (all of them with PhD’s, mostly from Ivy league universities) being anywhere close to that amount. Passing your exams, working hard and saving diligently is usually not enough to get there. Now, if you spend most of your time thinking how to make money and you are smart, then there are ways of course.

#115 Kelly McMae on 12.06.09 at 2:19 am

Vancouver is lame and toxic in so many regards. If you value quality of life move somewhere and buy and sweet house for $300K, invest and live off the proceeds till cows come dump on your.

Unless you’re addicted to Lulu-lemon and thrive on choice of Starbucks.

#116 Kelly McMae on 12.06.09 at 2:42 am

The term “political will” is about as ironic as they come.

To label politicians as leaders is a bit misleading. They are essentially managers and controllers. I see little in the form of leadership, much less an important component of leadership being stewardship.

These clowns manage, manipulate, and control, but nary have I witnessed much in the form of true leadership, at least in the sense of transformational or transforming. They are well versed in the art of transaction, and live in the word of zero-sum.

Punk nerd vigilantes living out the debate club dream.

#117 Kelly McMae on 12.06.09 at 2:53 am

#77 omg on 12.05.09 at 1:11 pm

Right now you could buy for less than $2000 in swanky stuffy let’s have tea oak bay. who’s the moron?

#118 Kelly McMae on 12.06.09 at 2:57 am

#80 S on 12.05.09 at 1:27 pm

Who is this “s”? have you seen the debt that most kids incur for a “good” education. pishaw.

You live in a world of delusion marked by dreams of common good and community trickling down your leg.

#119 Bob on 12.06.09 at 4:28 am

Garth, you have stated in the past that you think rates will likely return to their historical norm of around 8%, so is there any way for a new investor to take advantage of interest rates rising in the future?

#120 tom on 12.06.09 at 4:29 am

@97 “many friends and relatives harp about how they have it made living in the Canadian rainforest and it could not get any better..that is because they have not been anywhere and know not what they are missing.”

At least 50% of Vancouverites are from somewhere else – other countries or other parts of Canada, particularly Ontario.

#121 Patiently Waiting on 12.06.09 at 5:50 am

Elaine, if you want to know what the problem with Vancouver is, look in the mirror.

#122 David Bakody on 12.06.09 at 8:00 am

Well Elaine the jury is in, be smart and look for a new home town while you are young. Looking at ocean front is both safer and far less expensive. It all comes down to quality of life and the stress associated with it. Less is indeed more. Happy Holidays girl.

#123 shane on 12.06.09 at 11:09 am

Garth, if a person has money to invest in a business what would you recommend for a business over the next 5yrs?


Vulture. — Garth

#124 $fromA$ia ( o Y o ) on 12.06.09 at 11:12 am


If I buy an ounce of gold and inflation hits so that it takes twice the money to buy that same ounce of gold, why would I have to pay tax on it?

The value of the gold did not increase, it’s the money that has decreased which takes more decreased dollars to purchase that gold.


That’s a joke, right? — Garth

#125 Taxpayer like you on 12.06.09 at 11:12 am

Hello [email protected]

Please remember that in the case of our original poster, she has cashed out her RE, so the $600K reflects the equity she had. Now as far as S’s comments regarding trying to save that amount in cash (or easily cashable), I
will agree that it can be done, especially as a self-employed “expert” in whatever field (yes plumbing included). Does it take discipline and hard work? Definitely. I am surprised none of your ivy-league friends
havent attained such an amount. Of course the did pay
for that ivy league diploma. Shoulda been a plumber!

[email protected] Good to see you posting again, but I think you fell into the same trap as [email protected] and some others. We dont know what Elaine made on the house, because
we dont know what she paid, and how much was spent
on renos. We just know the mortgage was $375K.

But that doesnt change the present situation. All Elaine can look at is the $600K she has, and the price of RE in Van. If she must live in Van, consensus is dont buy!

#126 tom on 12.06.09 at 11:33 am

#111 Fool me once

Where is the evidence that Vancouver has a higher cost of living (aside from house buying of course)? I moved from Toronto and my cost of living, along with my salary unfortunately, dropped considerably. Transit, heating, rent, food – I found all of that to be cheaper in Vancouver. And because of the amenities so close to hand you don’t need a cottage up north to escape for the weekend. Just my view of course…

As for rain, well isn’t just that the rain falls as rain – and not as snow in so many other parts of Canada. What Vancouver is is grey – if you suffer from SAD and need lots of sunlight year round, Vancouver is not for you. IF you can handle complete cloud cover for a lot of the time, then you’ll be fine.

#127 BDG YYC on 12.06.09 at 12:09 pm

106 … Another Albertan ….

Great charts and comentary !

Thanks for posting … and in case folks missed it, I hope you don’t mind if I post it again …

Thought provoking stuff. Seattle, Portland, Vancouver timing (lag) is interesting. Would be great to see the rest of the major Canadian markets charted. Somebody somewhere has likely already done it. A bit of surfing is in order.

#128 Piccaso on 12.06.09 at 12:22 pm

#124 tom

Exactly, it is beautiful with mountains and coastline and green green green but you never see it. lol

#129 beauty in lala land on 12.06.09 at 12:54 pm

Kelly McMae careful you don’t choke on your superiority
complex. Trashing others doesn’t make you look smart dear, just a b****

#130 Another Albertan on 12.06.09 at 1:10 pm


This is a repost (reformat – easier to read) of another Vancouver blog’s comment.

#131 squidly77 on 12.06.09 at 1:22 pm


This was all good until there were no more greater fools left to bid up the inflated housing prices, and so the party abruptly stopped. People realized that they were not buying homes. In fact, they were renting them for the price of the mortgage.
The greatest fool

#132 $fromA$ia ( o Y o ) on 12.06.09 at 1:37 pm

That’s a joke, right? — Garth

With all do respect Garth, its a decent question/ concept. The same pronciple can be applied to government income tax. With inflation there will be more taxes received with out increasing the %.

Do you understand what I am getting at? In other words get rid of your cash for other assets and when inflation hits, transfer your assets back to cash. In the end youve just preserved your level of wealth, how can that be a joke, your no wealthier. If others didn’t play their cards right and they get stuck with holding too much FIAT cash, they lose.

Were not talking about making gains with the same dollars here, I mean going in and comming out with debased dollars.

You can’t measure an increase in level of wealth to tax.

Actually, comming to thing of it, it’s a pretty good deal if the government taxes regardless. Your still comming way out ahead. But still, I thnk its pretty dumb on the Governments part to create all this bubble $hit and fiat money anyhow.

#133 shane on 12.06.09 at 1:41 pm

Garth,Vulture. — Garth please explain?


#134 S on 12.06.09 at 1:41 pm

#116 Kelly McMae on 12.06.09 at 2:57 am

You said:
“#80 S on 12.05.09 at 1:27 pm

Who is this “s”? have you seen the debt that most kids incur for a “good” education. pishaw.

You live in a world of delusion marked by dreams of common good and community trickling down your leg.”

Yup, took a few years to pay mine off, too. Looks like I kicked over a beehive in your backyard. Delusion, however, is yours. This is the land of opportunities and everyone makes their own choices, then reaps as he/she had sown. Some just want to have fun, and there is nothing wrong with that: much more to life than money. Some will only consider careers giving them a sense of self-fulfillment regardless of the pay scale. There is absolutely nothing wrong with that, for sure. That is why we have those wonderful teachers to educate our children. The third category, much less numerous, is focused on more quantifiable accomplishment and uses $$$ as the measurement. Nothing wrong with that, either. (That is why we have Warren Buffets and guys like my welder buddy with his own welding truck working his butt off in the cold windy oil patch who – at a tender age of 48 – can easily announce himself, well.., very well off :) It all does go wrong when anyone from the first two categories looks at the third guy and wants to rip his face off for just having more. I suspect those folks are way more materialistic than the subject of their derision.

Derision is the subject of my posts on this thread.

Done and out.

#135 vreaa on 12.06.09 at 2:46 pm

Great anecdote, and good discussion.

Archived at VREAA as “We bought a home in Vancouver’s hideous inflated west side in 2005. When the markets starting tanking in October 2008 we stupidly panicked, put the house up for sale and essentially gave it away for about $1,000,000”

Bubbles stir the emotions, and even those who have profited by selling may feel confused. This Vancouverite, who has $600K equity in hand after selling her house in 2008, expresses regret, sheepishness,dismay, fear, greed, depression and resentment – all in one paragraph. This anecdote is also noteworthy in that it shows that supply does indeed come into the market as prices drop and owners begin to sell out of fear. How many Vancouver properties will enter the market when prices next descend? -vreaa

#136 the Coming Depression on 12.06.09 at 2:56 pm

#124 I don’t know, I’m sitting looking out the window at SUN, like I have been for a number of days. I’ve lived here for 4 years and I still don’t see these gloomy days of Vancouver that you fools have been inbred in your minds by the media. The only forecast I see gloomy, is the Real Estate market. Heavy clouds with a good chance of a Tsunami..

#137 Toronto C9 Renter on 12.06.09 at 3:20 pm

#112 “…my colleagues (all of them with PhD’s, mostly from Ivy league universities…”

So much hyperbole on this site sometimes. Please get real. The majority of the people that you work with did not recieve PHD’s at one of Yale, Harvard, Princeton, U Penn, Dartmouth, Cornell, Columbia, or Brown. Perhaps in your mind, but not in reality.

#138 ted on 12.06.09 at 3:25 pm

124. tom your salary droped when you moved from vancouver to Toronto. What on earth did you do in Vancouver and why did you then leave? Almost everyone else I know doubles there salary when leaving. And those who make good money stay because Vancouver is one of the few places where the high paying jobs are in cushy protected crown corps, or government jobs which are impossible to lose.

#139 Future Expatriate on 12.06.09 at 4:31 pm

#124 “IF you can handle complete cloud cover for a lot of the time, then you’ll be fine.

Try living in Las Vegas for a decade or more. You’ll pray for real daily cloud cover that doesn’t come out of the nozzles of drone jets every day for the rest of your life.

As well as strong offshore winds.

#140 Nostradamus jr. on 12.06.09 at 4:35 pm

Just read Elaine’s letter.

…My dear fellow Hongcouver citizen…Wait untill after the Olympics then pack your belongings and purchase a sizeable home in North Vancouver.

…You will have a short window of opportunity to find it as the world influx/stampede will begin after June…people need to sell their overseas properties first before relocating to our fair city.

…I predict at least a >25% increase in Hongcouver home prices in 2011.

…North Vancouver may see a >50% increase…because of the plethora of pet friendly trails and walks…and the exclusivity/privately gaited community feel of the North Shore makes the North Shore unbeatable for the safest & highest quality living experience.

…Do not listen to or heed the critics on this blog…they are the Eastern Canadian Wannabees.

Nostradamus jr.

#141 Nostradamus jr. on 12.06.09 at 4:43 pm

#109 beauty in la la land

“”Vancouver is certainly not San Francisco but seems to be about as expensive””

…You say San Francisco is better…many other people say Hongcouver is best city in North America.

…Toronto citizens very jealous of Hongcouver success…they say Hongcouver have no culture…they do not understand the West Coast Culture.

Nostradamus jr.

#142 ruraldude on 12.06.09 at 4:51 pm

The term “political will” is about as ironic as they come.
The only leader in Canada in recent memory that had any political will as far as debt elimination was Ralph Klein former premier of Alberta. He brought a 23 billion dollar debt down to 0 and I might add it wasn’t done on $147 dollar oil either.Oil was less than $20 a barrel when he started his crusade to slay the debt . Albertans made huge sacrifices and no sector was exempt from the ax. There is still hope for Canada’s present debt to be brought under control but is there the political will.

#143 Pat on 12.06.09 at 4:58 pm

#123 Taxpayer like you,

First, your comments are mostly beyond the point. Second, regarding: “Shoulda been a plumber!” – this would fall into category of spending most of your time thinking about how to make money. I chose to spend my time thinking about more interesting things, and I’ll be able to do it and get relatively well paid for it until I drop dead.

#144 Pat on 12.06.09 at 5:19 pm

#135 Toronto C9 Renter,

“… The majority of the people that you work with did not recieve PHD’s at one of Yale, Harvard, Princeton, U Penn, Dartmouth, Cornell, Columbia, or Brown. Perhaps in your mind, but not in reality.”

Have a look at the faculty of some science departments of top universities in the US.

(Although technically not there, I’d include Sanford, MIT and Berkeley in the ivy group too.)

#145 wellwell on 12.06.09 at 5:41 pm

It’s a bit perverse that Garth posts a message from someone who followed his advice and then missed out on the real estate rally this summer. She doesn’t deserve abuse for that — what is this, the Dr. Laura show, where being a fan means being humiliated for your loyalty? Sheesh!

On the other hand, I’m reminded of what J.P. Morgan said when asked the secret of his success in the markets: “I always sold too soon.”

#146 junius on 12.06.09 at 5:48 pm

I have no doubt that Vancouver’s market is over-heated. There is simply no reason to believe that at some point the market will correct and return to traditional increases of 2-3% per annum adjusted for inflation. However in order to reach that we would have to return to 2005-2006 prices which means at least a 10% drop and perhaps as much as 30%.

Keep your powder dry.

#147 Taxpayer like you on 12.06.09 at 6:23 pm

141 Pat. I am glad you find other things to think about besides money. But be honest with yourself. You obviously seem to be angry with mid-40s people who have acquired the stated amount of cash. Why is that, and why are you blogging here? As far as plumbing v.
Phd, I know not-so-rich plumbers too.

In the 80s recession, I examined some different career paths. Thought about accounting, teaching. Spoke with a
consellor at local PSI, who asked what I’d been doing
before and what I felt I was good at. When I said
engineering, he said “no brainer, do that, you’ll be happy, and the money will come”. I like that, because everybody wins that way. Its worked out so far.

Oh and check the latest issue of money sense. It had an interesting calculation of what your expected wealth should be given your age, education, wage. I was a
bit surprised. Given those factors, I’m more or less where I should be, even after some good years in business.

Have a nice day.

#148 junius on 12.06.09 at 6:23 pm

To Nostradamus Jr.,

I agree that Vancouver is a great city to live in but that is no reason for economic fundamentals to be ignored. Vancouver housing prices are higher than San Francisco yet our average income is at least 30K per annum less. That doesn’t add up in the long run.

The fact that so many people in Vancouver believe that normal economic rules do not apply is what makes this market so overheated right now. Conventional wisdom has people strapping themselves into the highest mortgage they can find without any doubt that rising prices will get them out of their future risk. Scary.

#149 kc on 12.06.09 at 6:26 pm

What still no update from Elaine?? I was looking forward to her rebuttle.

#150 Nostradamus Le Mad Vlad on 12.06.09 at 6:32 pm

#74 Piccaso — An investor from Europe recently bought a whole street of fairly new homes in Detroit, for somewhere around US$150K (no one lived there homes anymore).

Perhaps they looked a very good long-term investment. Not sure about that, as the big three are pretty much gonzo to greener pastures, along with suppliers, other mfg. jobs; as well, supermarkets have closed up and moved elsewhere.

Detroit now compared to two decades ago is akin to a ghost town. Violence and drugs rule the roost there.
Al Gore invented the internet, so this 1:19 movie clip from 1958 is wrong. — More Egg on St. Gal of the Ore’s face. “Then in the 1970s, it was the coming ice age, and now it’s back to global warming.” April Fools! However, does anyone notice a pattern? Line from Here are the truthful and accurate figures from Dilbert.
Explains who and why is running us. In charge
Inflation and Silver. 8:03 clip. Gold is hoarded; silver used.

#151 junius on 12.06.09 at 6:34 pm

The one thing I just can’t figure out is who people think are going to be able to afford these increases? The job market is not strong and even the companies hiring are not paying six figure salaries these days except for top flight jobs. We might even see deflation in the job market before the end of this recession.

Things in the U.S. are really bad. Check out this article from Harvard Prof and TARP Fund Manager Elizabeth Warren:

#152 Rob in NVan on 12.06.09 at 6:58 pm

Further to my comments earlier re. Vancouver house prices historically increasing at an average of 3 percent per year, and North American prices increasing at about 2 percent per annum:

Shiller clarifies that the actual average rate of increase is likely closer to 1 percent – the 2 to 3 percent figures fail to accurately account for more-recent houses being generally larger and more lavish (Vancouver’s recent “monster house” era ring any bells?), which of course naturally increases their prices and skews the average upward when comparisons are made with earlier era’s average prices. That is another trend that will abate/has abated.

So, all you specu-vestors out there best plan for realizing a 1 to 2 percent annual return under non-bubble conditions, minus all the inherent costs of ownership. Under such conditions a house ceases to be an “investment” and reverts to just being a “home”, as it should be.

Even in Vancouver.

#153 Wondering on 12.06.09 at 7:25 pm

Garth,Vulture. — Garth please explain?


Garth speaks in riddles so he’s not likely to get back to you on this. He even responds in Chinese, so we have to go to Babblefish to understand his response. Garth is too clever for us mortal souls.

Garth, it would be great if you could give responses that mean something instead of giving a quick quip!

#154 Pat on 12.06.09 at 7:29 pm

#145 Taxpayer like you:
“…You obviously seem to be angry with mid-40s people who have acquired the stated amount of cash.”

You obviously have reading comprehension problems amigo.

#155 David Bakody on 12.06.09 at 7:46 pm

149 junius on 12.06.09 at 6:34 pm

So what measures have been put into place by Harper Flaherty and Carney to ensure Canada does not follow the same route. In a word “None” and the sad part is a) Canadians will give him a majority to continue to do nothing and blame the middle class and b) the opposition parties are just that and feeble at best!

So run to Vancouver , Calgary or Toronto and buy a house and for those living there sell, sell , sell to greater fools and purchase a one way ticket out of town. Those that buy cross your fingers and toes and hope for even a greater fool. For the rest of us, stay put, pay down debt and enjoy life ….. and if you are like me plan to stay home for the next election.

#156 Nostradamus Le Mad Vlad on 12.06.09 at 7:53 pm

The Bilderberg Group. “Credible evidence (reveals) a world (banking) power elite intent on gaining absolute control over the planet and its natural resources, including its subservient human (ones).” It’s the Bilderberg Group classless society idea of rulers, serfs, and no middle class by controlling the world’s money.”

Guess this is the only reason for the world’s fiscal takedown, and it’s not getting better anytime soon. Because Obama, one of the pawns being used on the chess board, has now declared war on Pakistan (except AfPak haven’t done anything to us) — 9:13 clip. Another one.
CPP / OAS / GIS is a great Social Safety Net, but for how long?
I recently posted a link which said when the US$ rises, the markets will crash (not sure why, and I can’t remember which post it was in). Here — Dubai Aftershock is a similar version, as it may be joined with derivatives, and it also could be why a poster (here I think) chose to sell all investments and keep 100% cash for the time being.

#157 T.O. Bubble Boy on 12.06.09 at 8:10 pm

Great example of why you can’t bet everything on one type of asset (even if they are in theory doing a good thing by paying off the mortgage):

Couple, 50 years old, 2 kids, $90k/year income

House $550,000; RRSPs $35,000; RESP $19,000.
Total $604,000

Mortgage $202,000; Line of credit $44,000; Credit card debt $3,000.
Total $249,000

Their consumer debt (LOC + Credt Card) is far beyond their non-house savings (RRSP).

This couple literally has every penny of their Net Worth in their house!

Imagine what happens when the housing market declines 25%-30% (or whatever percentage it will be)… suddenly they have a $400k house with a $200k mortgage and still a ton of consumer debt (probably harder to pay off at that point, since the LOC would probably be at a higher rate by then).

These 2 will be 55-60, kids still in University or just out of school and probably living in their basement, and probably $175k (after closing costs etc.) in home equity as their only asset heading into retirement in a few years.

Anyway — not trying to “Play Garth” here, but this article shocked me at how positive it was (“they are going to be better off in retirement than they have been at any time since they were married”).

#158 kc on 12.06.09 at 9:37 pm

151 Wondering on 12.06.09 at 7:25 pm Garth,Vulture. — Garth please explain?


Garth speaks in riddles so he’s not likely to get back to you on this. He even responds in Chinese, so we have to go to Babblefish to understand his response. Garth is too clever for us mortal souls.

Garth, it would be great if you could give responses that mean something instead of giving a quick quip!

Do a search…. garth wrote extensively on this subject… i think it was during the summer….

#159 Elaine! on 12.06.09 at 11:09 pm

Thanks to Garth and the rest of you who offered constructive advice. I giggled at the rest of you who have the time and energy to spew hateful little barbs about what a selfish cow that I am. Tsk tsk jealousy is tremendously unbecoming, especially in this season of peace and brotherly love! Don’t worry, I get it – you’ve conjured up a great deal of resentment in your frustrated little heads over years of feeling screwed over by twats just like Elaine. Believe it or not, I used to be like you. I used to sit with my draft swilling friends at the legion dissing the man and the government that kept me feeling poor and useless. However, one day I woke up and realized that I was responsible to change my situation so I rolled my sleeves up, worked two jobs, ate KD and lived with roaches the size of kittens while I got a “hoity toity” nursing degree. When I got my first job I bought real estate in the dreaded Toronto and rented every room out to students and I slept on a pull out couch in the living room for years. I sold that property and went from there, so yeah, I have worked hard to get where I am. I am pissed off that I lost a wad of cash when I decided to become a henny penny like the rest of you at exactly the wrong time.

You see, people who hate too much usually feel pretty negative about themselves and heck, why wouldn’t you? You are stupid, lazy and scared little wimps who don’t have the courage to overcome the fear of living outside of the safe little 3 mile perimiter of whatever rat fink little town you were born in.

Incidently, I actually hate Vancouver. Living in Vancouver is like dating a model – all beauty, no brains. Tired retorts like “move somewhere else” are just not really always possible especially since we both have jobs that can only be found in urban centers – my husband is contractually tied here or we would leave for Ontario tomorrow. Incidently I don’t own a car, I ride my 12 year old bike to work ( no, I am not the angry, car kicking, spandex wearing type) I refuse to waste my life in commuter traffic in one of the 2 roads out of town with the worse drivers in the country just so I can get to my milquetoast home in a suburb when I can live 3 blocks from an ocean. So yeah, right now I will bleed this model for sheer joy her beauty offers me – knowing that I don’t have to stay forever.

Thanks everybody, it was fun and I wish you all happiness and bliss.

#160 Taxpayer like you on 12.06.09 at 11:38 pm

157 TO – these people are municipal employees with a
great pension plan (and other benifits too I would think)
which is given a zero value in their net worth statement.
With a paid for house and no kids at home that is why they will be “better off” in retirement.

#161 MPM on 12.07.09 at 12:00 pm

Elaine, pigs get fat, hogs get slaughtered. Be happy and quite whining.

#162 Zero Net Worth on 12.07.09 at 1:35 pm

I have to laugh when I read this. I’m also mid forties living in Vancouver (the West End in a shabby 1 bedroom rental). In my case though, I have zero savings, zero equity, and zero assets of any kind (not even a beater car). When I hear about someone complaining they only made $600K in 3 years, it sounds almost ridiculous.

Meanwhile, I just helped some local filmmakers finance a 2.5 million dollar feature film via a venture capital friend of mine, and will be lucky to pocket a $10K referral fee, and maybe one point on the back end. What a joke. Did I ever pick the wrong career path ..

#163 kc on 12.07.09 at 1:41 pm

159 Elaine! on 12.06.09 at 11:09 pm <<<< you have got to be kidding me??? you the same chick from the top of this blog who wrote that letter?? who you trying to kid?

Somehow i have to say BullS**t that you follow this blog as a faithful as you state. You now come in here with KD and working your way up the ladder of hard knocks, listen sweet cheecks, sounds like you need to return to those hard knocks to re-learn wht you missed the first time around.

My grand mother used to say (bless her soul) remember that when you die you are as dead and broke as the guy laying next to you, value life over money.


#164 pjwlk on 12.07.09 at 3:03 pm

#31 nonplused: Nice rant(s) on the auto stuff fella, but you’re giving away your age. I’ve had many of the same experiences as you but you have to step into the new world. I’d like to counter some of your points for sake of conversation.

– You can’t legislate common sense and no matter what the auto makers do or don’t do there are still going to be people who do stupid things and shouldn’t be driving.

– You sound like a rear wheel drive believer. I was until one winter during a storm I watched car after car, all front wheel drive, and half the size of my “battle star” station wagon drive by me without an issue.

– Traction control has been the best thing I ever discovered by accident. It also does not operate over a certain speed, so your comment about excelleration is moot. Traction control has saved my bacon many, many times especially when towing my trailers in the winter. You may be thinking of Yaw (sway) stability control which I do agree can teach people bad habits. However people have bad habits regardless so perhaps it may save a life one day.

– SUV’s wind up in the ditches because four wheel drive makes people think they can stop a lot faster than they really can. Nothing will save idiots who drive too fast in 4WD

– Your back end kicking out is just another form of instability that can kill people and has for many years. I used to practice in parking lots bringing my rear wheel drive car back under control after intentionally making it fishtail… only to be harassed by the police for “playing”. Guess what? It’s pretty bloody hard to fishtail a front wheel drive car without using the rear brake. Even harder if you know how to drive them properly.

– I believe that front-wheel drive to be far superior to rear wheel and quite honestly auto makers should be making pickup trucks with front wheel as the two wheel drive postion and the back wheels kick in when switched to 4WD.

– 100km/hour is regular highway speed here in Ontario so I’m not sure what you mean by that.

– It’s the big nut sacks hanging from the back of the trucks that cause most of the problems if you know what I mean…

#165 beng on 12.07.09 at 4:59 pm

Speaking of Vancouver…

Everybody wanna live in da Van’ity

#166 never mind on 12.07.09 at 7:25 pm

Garth, does it ever bother you that some of the comments just seem jealous, the advice sometimes ridiculous? who are you gearing to? who is your average reader? what’s their average education, class, income?
Just curious…

You start. — Garth

#167 Cory on 12.07.09 at 8:51 pm

My parents live in Mississauga Ontario and would love to have us move there so they can be closer to their grand kids. We live outside of Waterloo. In the spring we looked at a house in a very nice area of Mississauga. It was a 4 bedroom 2 car garage on a large lot 80X200. The house was clean but not particulary upgraded. It was listed for $879,900. It sold for $868K in a week. So even with a 600K downpayment you would still be stuck with a mortgage of $268K. We could do that but then we would have a mortgage. Where we live now we live on 2 acres and purachased the house for $670K in summer of 2008. When we bought it we sold our former house for $475K and added all of our savings a hefty $200K to make up for the difference. If I was to do it again I probably would have stayed in our old house and kept my 200K nicely in the bank. Thats moving up for you……