Zombies

Hi Garth ! I really enjoy your blog! As a pharmacist who moved from East coast to West coast, your blog is a therapy to all the in-law, co-workers, etc who are constantly asking why I am not in the market yet ! We were in Vancouver previously, but we have no future with our 150k total salary income to buy something normal considering we are now 30′s and we don’t picture ourselves in a million dollar slum in East Van.

As a part of my therapy, I participated to the zombie walk in Vancouver in mid-August. My partner and I were zombie realestate agents (that’s me in the picture). I could swear you that each time I said to a stranger ”Buy now!” they all laughed at me (about 50 persons surveyed) :) . And they were not zombies.

I will be grateful if you use this picture for one of your posts. — Sophie

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The summer ends with a flourish. Tomorrow the Case-Shiller home price index emerges from detritus of the US real estate rubble, and then we have the August body count from local Canadian real estate boards. C-S will show new price crumbles, while sales here melt.

All of this is proving too much for some realtors. They’re cracking.

And how can you blame the poor souls? It’s been brutal. A generational bull housing market from 2001 to 2010, interrupted by six months of dithering last winter. Prices rising during that time by 70%. A dumbass government that brought in 0% down and 40-year mortgages. A desperate central bank that dropped interest rates to 0.25% and plunged mortgages to 1.5%. A federal agency allowing 95% real estate leverage backed by taxpayers, so people without money can buy houses. Banks that awarded mortgages to anyone who could breath.

And now that Canadians are mired in debt, with the recession raging, jobs scarce, taxes rising and real estate priced out of reach, it’s that frickin’ Garth Turner’s fault.

I mean, listen to Agent Bob. He tells it like it is:

Ringleader Garth and his lynch-mob delight in mocking and ridiculing the predictions made by economists and the real estate industry. With his inflammatory language, he gleefully whips his blog dawgs into a frenzy, each one spurring the next to greater depths of despair and misery, as they stalk the internet for vulnerable victims. (Thankfully we have computers – the victims are subject only to cyber-lynching.) They terrorize the blogosphere and senior citizens. This comment is typical: “It would give me great joy to see a massive RE crash devastate all the OLD people financially and force them out on the street!” (Brian on 08.22.10 at 10:56 pm)

Garth can take credit for some accurate predictions, but let’s look at some of his other prophecies which were supposed to have happened by now…

Almost two years ago, Garth Turner said:

“Don’t be surprised if these things happen:
* Neighbourhood food shortages as just-in-time delivery systems are disrupted
* Electricity brownouts starting as early as the summer of 2009
* A pension crisis as retirees find out about unfunded liabilities
* Real estate prices in Calgary, Edmonton, Fort Mac at 50% of 2006 levels
* A wave of mortgage defaults. Yes, in Canada.
* Scaling back of 2010 Olympics in Vancouver
* Bankruptcy of major Ontario homebuilders

* Martial law in some US and European cities to quell protests of unemployed
* Seasoned firewood climbing to $300 a face cord”

It makes me think of this famous quote: “I’m an old man. I’ve seen many troubles. Most of which never happened.”

For a realtor, this is a pretty good piece of ad hominem. And I did make those, “don’t be surprised if this happens…” remarks when I wrote a book called ‘After the Crash’ in November and December of 2009. Some of them were reasonable (pension crisis, real estate values, Olympic money woes) while some are yet to come (mortgage defaults, builder bankruptcies) and some, thankfully, we avoided. You might remember those days – when the media was forecasting a neo-depression and financial collapse.

But what does this have to do with the current real estate mess? Right. Nada. It’s designed to discredit me. Fortunately that was done decades ago. So I’m now like the three-legged, blind, castrated, run-over dog called ‘Lucky.’ Nothing to lose. Why not bark the truth?

In any case, August sales were down almost 40% in Calgary, I hear, and the average home price fell $14,500 in a month. That’s 3.1%, or about 30% on an annualized basis.

I’d be cracking, too.

Frickin Turner.

(And here’s a frickin think tank report:)

‘Canada’s Housing Bubble: An accident waiting to happen’

(And a frickin magazine:)

‘The case against home ownership’