There are really, really, really a lot of lonely, sad people in Toronto who have yet to hear of eHarmony.ca. How else can you explain well over a thousand of them signing up to come and hear me on November 9th? Or are they all realtors? With weapons?
In any case, we’re now SRO, even after the hotel threw in another ballroom and 500 more chairs. So, registration is closed. I`ve sent notes to Springsteen and the Peas to see if they’d like to hot up the audience for me. Please bring disposable lighters, glow sticks and your own supply of Depends.
On a less serious note, let’s say you have the average Canadian family making the average income – about $70,000. You dwell in the average house, have average kids (1.2 of them), and pay average taxes. That means you have $54,000 left to live on for a year. Sadly, your house eats 48.9% of your pre-tax income, which equals $34,320 – which also means you have about $19,600 left. That’s $1,600 a month for food, clothes, car, vacations, school fees, insurance and your online connection to this pathetic site. Notice I did not include ‘savings and investments’ because, of course, there’s no money left.
And you think this is bad? Try living in a high-cost city like Toronto or Vancouver, where a house eats more than 50% and 65% of pre-tax family income respectively.
This is what happens when real estate speculation meets dumbass public policy, driving the cost of shelter absurdly higher. It’s a massive hidden tax on the middle class, sucking off billions which should be finding its way into a better life or a nest egg for the future. Instead, real estate now means sacrifice and debt. And danger.
So this week the latest Royal Bank affordability report was published, giving us that 48.9% average house cost number. But even that isn’t an honest figure. It’s based on buying a house at current prices with 25% down and a 25-year amortized mortgage. Trouble is, it’s a rare buyer now who has a quarter of the purchase price in cash, the average down payment being 7%.
Even so, this is a document which should have F and Mark Carney doing a dry heave. Families in record mortgage debt. Household liabilities now equaling 145% of earned income. Six in ten living paycheque to paycheque. Forty per not even trying to save. And almost half of earned income now feeding a house pretty much certain to depreciate.
This is what emergency interest rates, feckless lenders and irresponsible leaders have wrought – house lust. Whether it was the CEO of LePage, the economist at CREA or the minister of finance – all of them share in leading buyers into bidding wars and debt quagmires. They turned shelter into a wealth killer, while telling us the American real estate slaughter could never happen here.
Well, guess what?
Even RBC now says there are “red flags” over the Vancouver market. “While the Vancouver market is clearly vulnerable to a price correction, this does not imply that a collapse is imminent because supply (both in the existing and new home sides of the market) is well contained at this point.” What does that mean? If listings rise, of course, it means there will be “a collapse.”
In the GTA: “The deteriorating trend in Toronto’s housing affordability continued.” And the bank cautions that a “wild downswing” in prices was kept at bay only because vendors retreated. Which begs the question of how long that will last. As I’ve told you before, I expect this correction to be followed by a multi-year melt, as interest rates normalize and then those oxygen-sucking, walker-wheeling Boomers start trading houses for income.
Let’s face it. RBC is a bank. Banks in Canada have huge mortgage portfolios. RBC is also a major pillar of the economy and well understands its corporate responsibility. So when it cautions that the average family is being sucked dry by the average house, this is a big deal. Owning a home traditionally took a third a family’s income, not half. The savings rate in 1967 was 7% and in 1982 it was 20%. Today it’s negative.
It’s also worth remembering the US housing market collapsed when it took 4.6 times the average income to buy the average home. Today in Canada the number’s 5.1. In Toronto, 5.5. In Vancouver, 9.3.
Most people have no idea what they’ve done.
Do you?
232 comments ↓
I retain legal copyright of all of Mrs. Grinch’s images. Please remove her picture from your website.
On another note – ever get copies of internal memos the banks circulate Garth? It would be nice to know what the bastards are contemplating from time to time.
I heard that F will “resisted pressure to prolong stimulus spending”. Oh my god, now we are really screwed. The recession hasn’t even ended. No stimulus will mean back to the recession. God Help Us!
http://money.ca.msn.com/investing/news/breaking-news/article.aspx?cp-documentid=25733898
Vancouvergoinup puts on a foam index finger, holds it up high and starts shouting
“most unaffordable? wheee !!!!!!!”
“we’re number one !!!!!!!!!!!!!”
“we’re number one !!!!!!!!!!!!!”
“we’re number one !!!!!!!!!!!!!”
“we’re number one !!!!!!!!!!!!!”
Is the hotel serving dinner rolls/buns?
Nice photo by the way :))
Garth,
The woman’s hot, but what’s with the guy with the gun?
Garth, Regarding your pic tonight; seriously what the hell is wrong with you!!
We wonder why the young guys who posted the BC Rape video on Face book thought that there was nothing wrong with it. How could they think anything else, when grown educated men like you put up pictures like this on a realistate blog. Your being a jerk….Get help!!
Is the pic of Sherry Cooper in her productive (from more points of view) youth?
Hubba, Hubba… if every used house came with one of those, I wouldn’t mind overpaying for real estate…
The wife might have some objections though ;-)
Today I called my credit union to cash in a GIC (ya, 1% interest gets pretty boring after awhile.). The friendly lady told me about their low low mortgage rates-3.5%, and asked me if I was tired of paying rent? Maybe I’d like to talk to someone in their lending department RIGHT NOW? Or maybe I know someone who would? Jeez…lay off on the desperation.
I’d really like to tell this lady that:
If I decided to buy my current place, and put $50k down, and took out a 35 year mortgage at 3.5%, the monthly payment would be $1620 per month. Alright, I’m paying $1350 in rent, so maybe that extra $270 would be worth it to call myself a “homeowner”.
But don’t forget…strata fees are an additional $275 a month. And property taxes are another $125 a month. And when I go to renew, rates will be a lot higher. And sometimes the strata hits you up for their “leaky condo fund.” And 35 years is a long time. And today on the radio I heard there is probably a bubble in Vancouver. It just looks worse and worse. No wonder they’re so concerned about my residential status.
@#7 : What on heck are you talking about? You’re likening a joke picture to some sicko kids posting a foul video online?
Oh dear.
Hey Garth, unfortunately I will be moving from B.C. to N.S. soon and will miss you, again.Thank’s for keeping me out of the market here.Won’t be in a rush to buy back east either, cheap rent there.Keep up the good work,probably doesn’t seem so thankless anymore.Once the tour is done take a vacation,you deserve it…
@This is Wonderland
Seriously, get a life.
Garth,
“I`ve sent notes to Springsteen and the Peas to see if they’d like to hot up the audience for me. Please bring disposable lighters, glow sticks and your own supply of Depends.”
I still can’t stop laughing (I attended your Vancouver session and that would have been great to see them before you)
Garth,
I have commented on this blog before. I own your books, and watched you speak in Kitchener earlier this year. Thanks for all your help. My wife and I are two happy, cash rich, homeless 20 somethings enjoying everyday!
Cheers,
Jordan
Another great post, Garth.
BTW, what’s the source for the following stat?
“Trouble is, it’s a rare buyer now who has a quarter of the purchase price in cash, the average down payment being 7%.”
#7 – First, it’s real estate, not realistate. Second, drawing a conclusion of an unfortunate incident to that picture is about as absurd as drawing a connection to the JFK assasination with Sesame Street. Neither have a damn thing to do with each other. Seek out your own advice and get help.
“This is Wonderland” re. post #7
Get a freaking grip man/woman/It’s Pat.
This a far cry from going out and committing rape…
god is she hot if i come to your event will you introduce me to her …damm!
Coming to see you October 5th! Definitely looking forward to it.
>> To echo Mr. Turner on fiscal reality:
Working people in Metro Vancouver need to earn more than $18 an hour in order to meet the most basic costs of raising a family, a new report says.
The study by the Canadian Centre for Policy Alternatives focused on two-parent families raising two children in Metro Vancouver to determine what they would need to earn a so-called living wage.
It found that in order to pay for the essentials of food, rent, childcare and transportation, two people working full-time need to earn $18.17 an hour apiece.
One of the report’s authors, Seth Klein, told CBC News the figure is based on a very conservative budget.
“There is no money for savings or retirement. There is no money for savings for a child’s post secondary education. The family rents a home, they don’t own. There is no money for debt or credit card interest,” Klein said.
“It is a basic budget. I’ve had the experience of walking many employers and CEOs through the calculation, and I’ve never once had one tell me they think it’s unreasonable,” he said.
Since the first CCPA study two years ago, the living wage has risen nearly a $1.50 an hour.
Klein says rent for a three-bedroom apartment has risen nearly eight per cent since then and the cost of food, and child-care has outstripped inflation.
The report urges employers to raise wages up to the living wage level. Currently the minimum wage for adults in B.C. is $8 an hour.
Read More: http://tinyurl.com/25bf2m
I like this picture.
#1 Grandpa Grinch
Oh jeez, Gramps, I’m sorry, I didn’t realize my mistress was your wife. She just said her name was Suzie.
And Garth why are you printing all this nonsense when F clearly said today that the recession was over and everything was alright. (Someone should check his flight schedule for the next couple of months.)
there are some weirdos in the world. I really can’t believe some people come here and complain about the pictures.
Poster ‘This Is Wonderful’ made reference to the rape video in B.C…mentioning that and associating it with the picture of this blog is beyond weird!!!
wow, lol. You see, it only takes a few words from people and I’m reminded that is in fact possible for a shed to sell for $1,000,000. Thanks.
“two things are infinite: the universe and human stupidity; and I’m not sure about the universe”- Albert Einstein
Nice Picture Garth.
It looks like I will be able to say what I want today. You will be busy on the phone,most of the day, explaining your choice picture.
Wish you had it posted on the night of your Toronto engagement.
___________________________________________
Now back to the blog.
It’s also worth remembering the US housing market collapsed when it took 4.6 times the average income to buy the average home. Today in Canada the number’s 5.1. In Toronto, 5.5. In Vancouver, 9.3.
Most people have no idea what they’ve done.
Do you?
*****************************************
Wild , how about we start printing more money Garth.
Then we will raise taxes some more, ( till there is no middle class left)
Next we will call out the army to quell the riots and looting. Can’t have the people looting the grocery store for food now.
All these unlawful, starved, overtaxed people must now pay for their crimes.
Thank God Stockwell Day seen this coming and has built extra prisons for such an occasion. ( truly a man of vision)
Once the examples have been set against these rebellious criminals, the rest of the sheeple will fall into line. Bleeting to be saved by their Masters who enslaved them in the first place.
Once the free thinkers have been imprisoned, exterminated, the sheeple will work for food and water and thank their Masters for allowing them to exist. ( Pathetic, spineless fools)
Yup the futurelooks pretty Rosy to me Garth.
I, for one, will not will not follow the pied piper, down the path of distruction.
http://www.youtube.com/watch?v=ctyxf41mAJI
Gotta say, I don’t understand the photo tonight…but good job!
“I am only able to load the first set of comments to a new post with Firefox browser. It’s been this way since Garth’s site was hacked. Internet Explorer lets me have more if not all sometimes. I’d sure like to know what is causing this.”
Yes. I have seen the same. It’s not your browser. Tonight the server took several seconds to respond before any data at all was transferred. Like the server is in Japan or something. Slooooow.
Garth, I know you like your web host provider and all, but they don’t seem to be able to keep up with demand.
#7 – get a grip. Are you going to go after Sears too for having a picture of some woman in a bra ad? How about those billboards for the lingerie ads, kind of revealing too. Let’s just ban advertising and free speech, that will solve the problem for sure!!! “”Your being a jerk….Get help!”<—- the person who needs help is not Garth. You should work for the Internet Censor Board. Wait, we don't have one.
Garth
You are wonderful and have an excellent foresight.
There is no need for a gun,She is very inviting and vultures are full of lust, no need for a gun.
he is now like all other Torontoians
Or Probably he wants to shoot her after she got him into home purchase.
Excellent work my friend, keep up the good work.
Sales so far for Greater Vancouver for September are abysmal with 3 business days left. On track for the worst Sept new home sales since 1994. Thanks Flats. Thanks Carney. Thanks Banks. Thanks stupid 20 somethings.
http://vancouvercondo.info/forum/topic/september-data/page/2
Winnipeg? I hear it is the town that time, and the real estate bubble, forgot. That is a very good thing.
Any blog dawgs out there know what’s happening in The Peg?
It sucks that real estate is so local….if I lived in Van, the decision is easy — don’t buy a condo for $600,000 that you can rent for $2000/mo. Same with Toronto, although the metrics are a little tighter.
However, as I’ve stated and shown in the past, the rental market in Ottawa is absurd (yes, I know, one can always find ‘cheap’ places if one lowers their standards). The Ottawa market essentially forces one to buy. Here are some fairly comparable examples of the buy/sell equation:
45 minute (8 am) commute to downtown:
Rent = $1500/mo (http://www.grapevine.ca/listing.cgi?id=28631)
Buy = $260,000 (http://www.realtor.ca/propertyDetails.aspx?propertyId=9931037&PidKey=-875759203)
10 minute commute to downtown:
Rent = $1900/mo (http://www.grapevine.ca/listing.cgi?id=28637)
Buy = $325,000
(http://www.grapevine.ca/listing.cgi?id=27234)
What would YOU do given those choices?!?
#7, before posting, please step down from your giant steed and wake up.
While your lusting for the women your really should be watching for the man that’s about to rob you.
Love this blog Garth, keep going,What ever it takes to get the point across.
Bingo. — Garth
http://www.ft.com/cms/s/0/33ff9624-ca48-11df-a860-00144feab49a.html
“An “international currency war” has broken out, according to Guido Mantega, Brazil’s finance minister, as governments around the globe compete to lower their exchange rates to boost competitiveness.”
Yep, inflation is most definitely in the pipeline.
Same thing happened in the 30’s. Global currency devaluations in a ‘beggar thy neighbor’ approach to mercantilism in the global economy. Needless to say, this is not good.
–
“Well, guess what? Do you? . . . real estate speculation meets dumbass public policy, . . . feckless lenders and irresponsible leaders have wrought – house lust. Most people have no idea what they’ve done.”
Well, they’re about to find out pretty damn quick come renewal time, or if one / both lose their jobs.
But that’s reality. Now back to your regularly skeduled Conspiracy Theory Programs, beginning with 60 Minutes of Trailer Park Trash!
*
#184 Cashman on 09.27.10 at 9:34 pm — Excellent post and correct. No conspiracy theory, just plain simple truth which some can’t handle.
David Crane had a good headline on his column today — “Great Recession still painful”.
Now let’s call a spade a shovel full of shit — it’s not a Great Recession, it’s Great Depression II. No matter how much one polishes a turd, it’s still a turd.
Ten min. clip Silver shines!
Cycles never before seen, nor understood.
Liar Liar Headline sums it up nicely.
The missing ten minutes explained during the flash crash, May 6.
Preparing for a HAARP shot on the SAF?
NWO Control and how they do it. Incl. 7:36 clip.
2:58 clip A real eye-opener.
“Most people have no idea what they’ve done.
Do you?” – Garth
Yes, I paid it off.
2 Jeff Smith – so I guess we can count you in the “spend now pay later/never” camp?
#2 Jeff Smith
I don’t know if your kidding or not …
http://www.businessweek.com/news/2010-09-26/chinese-real-estate-bust-is-morphing-into-a-slow-leak-andy-xie.html
Obviously, any melting or slow selling in China will definitely drive up Vancouver and Kelowna as Chinese have way more money to buy abroad? Ahhhh, no. 22 days until rain season.
They’re going to California and Florida for deals like everyone should until the insanity of unsustainable prices go away.
This is what emergency interest rates, feckless lenders and irresponsible leaders have wrought – house lust. Whether it was the CEO of LePage, the economist at CREA or the minister of finance – all of them share in leading buyers into bidding wars and debt quagmires. They turned shelter into a wealth killer, while telling us the American real estate slaughter could never happen here.
*****************
This is good stuff-
An area that needs to be hammered hard-
There “should” be a way to pin these crooked deceiving bastards-into taking responsibility-
All of what you mention-is nothing short of Treason-
It’s called “looting the Treasury”
It’s always been called that-
Then comes looting the People-
Then comes a collapse of Governments-
Then appears-a man on a White Horse–“Always”
Those you speak of-should be drawn and quartered for what they’ve done to the future generations of this Country-all in the name of re-election and enriching the Banker and Corporate scum–
***********************
Even so, this is a document which should have F and Mark Carney doing a dry heave. Families in record mortgage debt. Household liabilities now equaling 145% of earned income. Six in ten living paycheque to paycheque. Forty per not even trying to save.
*******************
We live amongst a totally dumbed down Society-who hasn’t got the foggiest idea-of how to live within their means-how to save or a clue what to do now-so-
of course they’ll scream for “Government” to do “something” and the Government will gladly do something-
They’ll extend UI-they’ll give cash back for refies and new buys-they’ll pump stimulus-then come food stamps-they’ll pick our kids pockets to pay for it-
They’ll get re-elected by flat broke destitute boomers for doing it-or-one of the other proven totally useless/clueless party leaders will be elected and we’ll still go nowhere-until all the deluded-vote rich boomers-get a clue-or finally die-
So we might as well get comfortable-cuz-
It wont be happening-any time soon-
One thing that may be uniquely Canadian is that when we don’t get our price for real estate, we just wait. Funny how that works. Maybe we just are not smart enough to lower asking prices by $100K to placate the dooms dayers and wishes of a band of gold bugs, conspiracy theorists and dooms dayers. Why does there need to be a collapse because there is more inventory? Since when do people drop their asking prices to such an extent it would trigger such a collapse -because Garth says so? I appreciate Garth’s intellect and advise in financial planning but the horse he’s riding into town is a mule. Even an evangelist spits out truths to keep the congregation in order. A clock is right twice a day. No need to fan a fire, pour more gasoline or just start another fire in a new town, but please drop the idea that Canadians will just sell for whatever price someone may be willing to pay. We’re a stubborn old bunch. Distress sales may and do occur, but hardly enough to suggest the sky is falling and impossible to replicate a US style decline.
But there are books to sell, advisors to market, advice to extoll and this is not just a one horse/mule town. There are even jackasses who inhabit this lovely place.
BTW, excellent taste in women!
#7 This is Wonderland
There is a world of difference and you diminish the heinousness of those boys by even venturing to compare the two.
#7
This Is Wonderline —-
By the same logic are we going to blame Tom Sellick for causing a mustache explosion in the 80’s?
Here’s a thought:
Maybe the animals that commited that crime should be held 100 percent accountable for the actions they took.
I know that sounds crazy, right?
That instead of blaming tv, talking heads, music, drugs, booze, we actually blame the person.
It’s a radical idea.
Or maybe Garth Turner is to blame. He is not a mouthpiece for the frugal grandfathers of Canada, no no, he is subvertly attempting to create a crime wave in Canada through suggestive photo’s.
#7 This is Wonderland on 09.27.10 at 10:19 pm
————————————————
You may have stalled on rational thought if you think Garth’s picture is linked to the God-awful disgusting behaviour of ‘lower-than-slime-mould’ ‘scum-of-the-earth’ type people that either partook in, video taped, and/or posted video on the web of that horrific event.
Is ‘dove’ just as guilty as Garth for posting the following picture:
http://www.dove.co.uk/#/products/lotion/
I can think of better people to blame: how about the ones that actually committed the crime? I’d even go as far as putting some blame on the perpetrators’ parents for not raising human beings capable of understanding moral vs. criminal behaviour.
Garth, I love that you let most posts fly under the radar and into your thread. This is why this site is absolutely amazing, you let everyone in to the club regardless of how non-in they may be. Freedom makes for messy but damn good posts. Thanks for being the doorman green lighting the fake id’s.
Great pic Garth keep it up.
Don’t know if this has already been posted, but here is msm (ctv) version of what Garth is talking about.
http://www.ctv.ca/CTVNews/Canada/20100927/home-ownership-costs-canada-100927/
Hi Garth
Agent in Calgary said to me now is the second best time to buy in Calgary AB. The best being the year 2000. They said what was once 600k is now 500k buy now. I said what is 500k was once 250k .I wont be purchasing anything in Canada for quite some time.
40k for 700 square feet near old town in Scottsdale. I will be enjoying the winters stateside in about 15 years for less than a new fifth wheel trailer.
Wonderland: You obviously have no understanding of the picture with or without the gun; Or the crime you referred to in Your Cheap Shot.
Get a life, —and computer. You have
already failed the first, try the second.
KenS in LaLa-Van
Wow,
I just heard on Ann Rohmer’s “HOT PROPERTY” show that the CMHC has a special category for new immigrants, where the lending rules are not as tough or stringent as Canadians that have been born here or have lived here for a significant period of time.
How much more lax can our government be?
#7 This is Wonderland
Take a pill, relax.
have a drink.
Nice Pic Garth,
Put more of these in your Powerpoint, and you’ll pack em in at your next event!
The city is desperately trying to sell the units at Olympic Village to suckers. They’re talking about taking them off the market until it rebounds. When will that be 2020 lol!
35% sell/list ratio today in happy Vancouver.
Lovely artistic photo today Garth, nothing wrong with the female form, its beautiful. Certainly I dont get the same inner glow when looking at any house but each to their own, I say.
Aussie Update.
http://www.smartcompany.com.au/property/20100524-housing-market-slowdown-worse-than-official-auction-data-suggests-expert.html
http://www.smartcompany.com.au/economy/20100927-the-big-picture-why-exploding-housing-bubble-fears-could-be-good-for-the-sharemarket.html
Have the French and the British govts seen the top of the Aussie market so they are cashing out?.
http://smh.domain.com.au/estate-agents-grab-high-commissions-as-the-empire-cuts-back-20100927-15u5o.html
Oops Qld state govt buys a million dollar suburb by mistake, its ok though RE only ever goes up so how much will they make on the deal – Oh dear its gone down in value, oh well taxpayers have them covered.
“Until then, the properties are being rented, most at between $500 and $600 a week. The most expensive, 18 Imara Ct, bought for $1,314,000 in April this year, fetches $620 a week”. What a deal 2.5ish% gross rental yield until its sold, now thats an investment LOL.
http://www.news.com.au/money/property/mansions-bought-by-state-government-for-transport-corridor-are-no-longer-needed/story-e6frfmd0-1225930582817
#7 This is Wonderland on 09.27.10 at 10:19 pm
Ughm, the woman in the picture looks quite content, it’s probably her “thing” ;)
@This is Wonderland: learn to tell the difference between a photo composition and reality.
Or get help.
Economics 101: Supply and Demand
The market is never wrong, the prices are not too low or too high, they are exactly where they should be. Any object (house, car, diamond, stocks), is “worth” exactly what people are willing to pay for it.
If it were true that it is overpriced, and a cheaper home in, say, Winnipeg, is worth the savings, then people would move to WInnipeg. The drop in demand in Vancouver would lower prices there, and raise prices in Winnipeg. That does not appear to be happening. So, if prices are more in Vancouver, it’s because they are worth it.
No different than my local Canucks. I cannot afford to go to a game, decent seats are > $100 each. However, I cannot say they are overpriced. The team (despite their dodgy playoff record), has somehow recorded literally hundreds of sellouts in a row at GM place. That tells me that the currently price, as high as it is for me, is actually too low. If it were not, the seats would empty out, and prices would fall or at least not increase, but they haven’t had to do that so they must be the “correct” price.
If you cannot afford something, but price sustainment suggests others can, that does not mean it is overpriced, it simply means that you cannot afford it.
7 # This is wonderland,
Oh give me a break….this has nothing to do or compare with the BC RAPe. You have the problem…the moment you see a pretty girl in lingerae and you think of rape…it never even occurred to me when i look at this picture.
All i see is a paranoid guy with a gun who might have heard something in his girl friends bedroom or they could be role playing …” My Name is Bond…James Bond” But since this is garth site. . It should be ” My name is Turner …Garth Turner”
” I here to rescue you from the gang of realtors!!” …hahahaha
” Is it a game you and the missus play…garth? By the way I enjoyed your Talk In Vancouver…but just so u know…houses do still sell here. I just talked to My friend. Her Dad sold his business/ house and used the money to buy a house here. oh well it’s the boomer thing ….59 retiring early…and no he is not Asian. i think he is mixed Arabic/ persian something like that…..
it’s not the weather…it’s family. His 2 girls have established roots here.. So it really doesn’t matter where. it’s about family.
I’m not precisely sure how the pic applies, but I have decided that I don’t care.
Grownups don’t wave guns at pretty girls.
Vancouver, Victoria, Kelowna are going down. When the RBC admits it – in a backhanded sort of a way – you know that they are telling their mortgage lenders to back off.
I just snagged a great rental at less than 1.5% of the asking per year. Vacant and no one had been through in two months. Big houses are not selling. Nor are little ones.
I’m looking forward to hearing – and perhaps interviewing you for http://Resouceclips.com – when you come to Victoria next month. Where we go next is down; smart people are diversifying to stuff that will go down slower or, even, up.
The pic is supposed to be that the girl represents house lust and the guy is the realtor/banker who is hiding from you the victim. What is so difficult?
Garth Wrote:
“In any case, we’re now SRO, even after the hotel threw in another ballroom and 500 more chairs. So, registration is closed”
———————————————————–
I am guessing SRO must mean “Sold right out.”
Nice going Garth and congratulations. That is a big poke in the eye to your previous Toronto host who unceremoniously dumped you and will now get to regret that most of us here have forgotten their name.
Who were they again…?
You might remember their corespondent; that snarky semi-literate secretary who sent the rejection letter we all laughed about last month. Good riddance.
And that is my point. People want to hear the message.
The vindictive squats who want to manipulate public perceptions by suppressing open debate, discussion and dialogue and the dissemination of valuable and valid information are all forgotten so easily.
So 1000 people eh? I wish I could say I was impressed but I anticipated that and more. (There are more)
Well done.
“realistate” blog…LOL
How true …. housing is a staple and cannot stray too far from the mean. It’s difficult to understand why national policy would follow this path. Can this be a federally sanctified wealth transfer?
Ditto that 7.
Garth, I think I get the image, however….best to switch it out
I asked much the same question just a while back: http://gailvazoxlade.com/blog/archives/1943
I’m not sure what it’ll take for people to realize that we are in deep doo doo and headed to more and they have to STOP SPENDING MONEY THEY HAVEN’T MADE YET.
Such a simple concept.
Please remove the pic, the gun part is really not appreciated.
I gravitated to this site because I sensed something was out of whack with the price of homes in Canada. But I also know that there is nothing wrong with owning or buying a home. The problem is in the affordability of said homes. I learned from this site what is considered affordable (no more than 3 times earning). As long as one lives within or below ones means, and buys a house that is commisurate to his or her income, there should not be a problem. For example, Garth states that the average Canadian family makes $70K a year, so that family should consider a house that costs no more than 210K; similarly a family making minimum wage and wants to live in a house makes about 40K a year – nothing wrong with them buying a house at 120K. I realize these prices are not realistic; consequently, the solution is that more people should rent or prices need to reduce to the point where they are affordable to the middle class Canadian.
I look forward to Nov 9th. Garth’s presentation will probably change my mind about this.
what, the photo got everyone tongue tied?
um…is this about house lust or lusting what’s in the house?
All of these get rich phenoms end the same way….tech stocks, oil, RE, gold….If there is a one way ticket to becoming rich…its not going to end well.
Things always revert to the historically normal trendline. RE will do the same here.
#7 This is Wonderland
…educated men…
We are all apes. What is new? Thanks for the pic Garth.
Most people have no idea what they’ve done.
Do you?
Yes they did, they simply jumped on the ode band wagon sold to them by family, friends and of course government agencies. How could they possibly loose Mr. Turner ? ….oops sorry you just said it, then again we have been saying it for long time.
Yesterday’s election in New Brunswick proves that people to care if the government it broke …. they voted in a party full of bags of stuff with no plan or way to pay for it. Sound familiar?
Only when Southern Ontario looks like Detroit, Vancouver like Arizona and rual towns turn into dust bowls will poeple get it and even then it will be someone else’s fault.
Exhibition Stadium next Mr. Turner?
Re 905er
Maybe its her Husband protecting them from a banker, since our gov wont !
Garth wrote “This is what emergency interest rates, feckless lenders and irresponsible leaders have wrought – house lust.”
I would also hold culpable home buyers who aggressively bid-up prices adding a sense of urgency to the buying process. There was some clown on a news broadcast last night preening about “ya we paid more than the asking price…but we got an extra bedroom”. Clueless.
BTW great pic. Wonderland…your rant is soooo ’90s. PC is coming to an end friend. Looks like you’ll have to find some new ideology to do your thinking for you.
For those who are struggling, an explanation of diagram follows:
Exhibit A. Woman poses for a photo for her boyfriend while husband is at work.
Exhibit B. Woman’s husband arrives home from work early and happens to have a gun, which will come in handy in the next scene.
Exhibit C. Blood and carnage. And probably a missing glove.
Analogy to real estate situation: While you’re totally consumed with house lust, just around the corner and unbeknownst to you, (unless of course, you read greaterfool.ca), a very unpleasant surprise awaits.
A picture is worth a thousand words, give or take a few hundred.
For us girls it looks like the guy with the gun is packing in his pants as well.
The RBC report using “pre-tax” income is going to confuse a lot of people including myself.
If you subtract the 48.9% or aprox. 50% from the average pre-tax income of $70K the balance is $35K. Subtract taxes of aprox. 22% or $8K and you would be left with $27K or $2,250 a month for food, clothing, etc. Do I need another cup of coffee?
#56 Leftbrain on 09.28.10 at 2:05 am
Economics 101: Supply and Demand
The market is never wrong, the prices are not too low or too high, they are exactly where they should be. Any object (house, car, diamond, stocks), is “worth” exactly what people are willing to pay for it.
LOL – So houses in the USA and other bubbled markets were not overpriced but just right. Sounds like a fairy tale to me. Price and value are two different things and the basis of your economics 101 is “markets are always in equalibrium” should be treated like other fairy tales. Ok for kiddies but us grown ups know its just a cute story. Markets are a reflection of their participants which are human, we are emotional so are markets. You do however also prove the old saying a fool and his money are soon parted.
Someone who’s seen the light on the US economy and central bank:
http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100007777/shut-down-the-fed-part-ii/
Garth,
The disturbing thing about the photo is this…most of your idiot bloggers can’t seem to make the connection between the everyday denigration of women (such as is on your blog today…which does by the way, suggest an imminent crime) and the subsequent victimization of women. #7 is quite right. It’s all connected…
We all need and crave attention Garth…but hey, you’re at the peak of your credibility…it’s time to bask in the spotlight…let the weenies go elsewhere for their soft porn…stick to real estate…that’s why we’re all here…
It did not occur to me when I selected this photo that so many people would be one-dimensional in their reactions. The picture is allegorical. The woman represents our infatuation with physical assets and is an object of desire. The person taking the photo, and for whom she is posing, is the lustful one. Her allure is so great he fails to see the immense threat which just came into his life. She is aware, yet smiles on. How could it be about anything other than real estate? — Garth
Bill Gross: More QE Will Lead To A “Declining Dollar And A Lower Standard Of Living; Druckenmiller Departure Is End Of Old Normal”
Some very troubling observations from Bill Gross. In summary: “What the U.S. economy needs to do in order to return to the “old” normal is to recreate nominal GDP growth of 5%, the majority of which likely comes from inflation. Inflation is the classic “coin shaving” technique of government since the Roman Empire. In modern parlance, you print money faster than required, pray that the private sector will spend it to generate investment and consumption, and then worry about the consequences in a later decade. Ditto for deficits and fiscal policy. It’s that prayer, however, which the financial markets are now doubting, resembling circumstances which in part are reminiscent of the lost decades in Japan since the early 1990s. If the private sector – through undue caution and braking demographic influences –refuses to take the bait, the reflationary trap will never snap shut. Investors will likely not know whether the mouse has grabbed for the cheese for several years forward…The most likely consequence of stimulative government policies that strain to get us there will be a declining dollar and a lower standard of living. Stan Druckenmiller is leaving, and with good reason. A future of low investment returns, and a heap of trouble for those expecting more, is what lies ahead.”
http://www.zerohedge.com/article/bill-gross-more-qe-will-lead-declining-dollar-and-lower-standard-living
All asset markets will top out once they become too popular. If everyone who wants to buy has already bought then there is no one left to sell too. It only then takes a small catalyst to change the direction in price. Housing will go down because it is over owned and too expensive.
On page 14 of this pdf from the official government propaganda you can see that the home ownership rate at 68% is the highest it has ever been in Canada.
http://www.bankofcanada.ca/en/about/pdf/chart_media_75years.pdf
Re # 190 BrianT ( yesterday)
#184Cash-the same type of person that loosely uses the term “conspiracy” to discredit logical analysis would have used blasphemy or infidel hundreds of yrs ago-that type of person is simply appealing to authority or trying to convince themselves that if they continue to do what they are told they will get what they want.
*****************************************
Excellent analogy. 200 years ago they would be burning / hanging/ decapitating such people while the masses cheered.
___________________________________________
Re # 25 Micheal Motorcycle:
Gotta say, I don’t understand the photo tonight…but good job!
******************************************
The woman in the photo represents the uninformed sheeple who are buying real estate. ( just look at her lustful yet innocent/blank look eyes )
The man at the door, with the gun, represents the financial cronies. He has come to take back what was never hers in the first place.
Like the sheep who know not went they are being led to the slaughter.
___________________________________________
Lots of wonderful news today:
Talked to my realation this morning. One condo developer is shitting his pants. 43% of the presolds were foriegn investors. 70% of those have walked away. Don’t care about lost deposits.
Got a call from one of my old nieghbours when I lived in TO. Said they can barley afford to stay in house which they bought 15 years ago, for around $240,000.00 by lake. ( $115,000.00 down payment)
I said it should be almost payed for, she is retiring in 3 years. ( husband lost job 5 years ago, still too proud to take jusy any job)
She informs me that they still owe $200,000.00. Have been borrowing against house to enjoy life.
I told her she should have sold a year or two ago. She responded she liked the area.
Some peple you just can’t help, they still don’t get it.
Takedown of the US is underway.
Lotsa stuff. Iran dumps the Euro for the US$ and other assorted junk.
Currency revaluations? Why not. They are not worth anything now!
Hold onto your hats if Alan Greenspan says that Gold is money!
IMMUTABLE GOLD, AGING CURRENCIES, GOLDEN FLEECE
While gold this date is around $1,292.00 US, overnight Sunday to Monday, it blew past $1,300.00. Gold Bugs everywhere are still giddy with excitement. Deservedly so, because I think gold has a way to go to the upside.
This higher price is a combination of demand from the usual sources, jewelry and industry but, most important, it is a hedge against this awful “beggar thy neighbour’s currency contest” making the rounds amongst the G20 nations:
a form of trade protectionism that portends a bad outcome.
This is why gold keeps getting more popular among investors, not just those gold bugs.
If I ever feel like getting into an argument with Garth about my long-range doom and gloom outlook for the world’s phoney-baloney, drowning in debt economy, I wait impatiently for the latest ruminations from Ambrose Evans-Pritchard, business journalist of the Telegraph newspaper, London UK, to help make my argument.
His latest offering, as usual, doesn’t disappoint: this past weekend.
“Gold is the final refuge against universal currency debasement” is the latest headline:
He writes: States accounting for two-thirds of the global economy are… “holding down their exchange rates by direct intervention…to shift (their) problems on to somebody else…Nothing like this has been seen SINCE THE 1930s.”
At the base of currency debasement is trade protectionism. Evans-Pritchard suggests, as an example, that if China accedes to US demands to force the Yuan to appreciate, as Chinese government policy against the USD, the result in China will be widespread industrial collapse followed by civil unrest (That’s why the Chinese premier, in a one-on-one meeting with Obama last week in New York, told him to go fly a kite; no deal).
The article goes on: “We have a new world order where China and India are buying gold on every dip, where the West faces an ageing crisis, and where the soverign states of the US, Japan and most of Western Europe have public debt trajectories near or beyond THE POINT OF NO RETURN.”
He concludes that the “manager of all four reserve currencies are playing fast and loose: the US, UK, EU, and Japan are “clipping” their currencies for whatever miniscule advantage that may arise as a result.
What a dog’s breakfast.
Gold Bugs have been pretty roundly persecuted for the last $1,000.00 or so of the precious metal’s price. At this stage of the game they have been vindicated.
However, Evans-Prtichard cautions that gold has had its depths of price despair, but still has a way to go after its all-time high during the 14th and 15th centuries, in Medieval Europe, where the metal was priced in the $2,400.00 per ounce range at today’s prices!
Meanwhile from another blog, this quote the other day from former Fed Boss Alan Greenspan on the American Empire’s money problems: “We are now at a state where, excluding World War II, we are in the worst shape of relationship between borrowing capacity and debt, I suspect, since 1791 (when the US Bill of Rights establishing limits of governmental powers was approved by Congress).
Gold therefore remains a speculative segment of any sane investor’s portfolio. While it pays no dividends, except as a counter-protection against the erosion of failing fiat currencies, all over the damn place, that ancient immutable metal still has a shiney future.
It’s, therefore a future somewhat shinier than at 400 square foot concrete box on the 40th floor in some awful downtown Canada skyscraper.
To create a pun from Greek mythology, watch out for the real estate market’s Golden Fleece all you wannabe property Argonauts out there. Beware the siren song of real estate boards everywhere. Also remember this: he who owns the gold makes the rules.
That girl should be on Sesame Street!
finally… a seriously less serious tone from GT! :)
I agree with it all… there are clear warning signs of a potential bubble
http://takloo.wordpress.com/2010/09/27/you-aint-seen-nothing-yet-prime-1-00-variables/
Have you seen this?
http://www.wnetwork.com/Shows/BurnMyMortgage.aspx
A sign of the times… Deleveraging here we come!
#81Anne-Gross fails to mention that although the US economy is contracting and will continue to contract for the foreseeable future, the Asian economies are not contracting overall. There is still growth there.
#77 brainsail “The RBC report using “pre-tax” income is going to confuse a lot of people including myself…If you subtract the 48.9% or aprox. 50% from the average pre-tax income of $70K the balance is $35K. Subtract taxes of aprox. 22% or $8K and you would be left with $27K or $2,250 a month for food, clothing, etc”
Let me help a bit. It’s actually $16,488.44 in tax, not $8k. That leaves just $1542 per month not $2250. (different prov are a little lower or higher than AB)
http://www.tax-services.ca/canadian-tax-calculator/income-tax-calculator-canada.html
But like you, we thought RBC should have used AFTER TAX income and “affordable” is LESS than 32%, not more.
#85 VICTORIA TEA PARTY” in Medieval Europe, where the metal was priced in the $2,400.00 per ounce range at today’s prices! ”
Keep dreaming buddy. I think you are on the WRONG BLOG. In Medieval Europe salt and simple spices were worth much more than gold.
#78 Aussie Roy
You are 100% correct! People need to understand the difference between price and value. This is so important when you are holding assets for the long term.
“It’s also worth remembering the US housing market collapsed when it took 4.6 times the average income to buy the average home. Today in Canada the number’s 5.1. In Toronto, 5.5. In Vancouver, 9.3.”
Calgary median income in 2008 was $91,000, assuming income is the same or up slightly, with Calgary median home prices at $390,000, we are sitting approx 4.2X…
Calgary also has a relatively young demographic (10,000 babies born in Calgary last year) and we have good job prospects… I’ve said it before, Calgary will be fine, prices will probably fall but the “melt” Garth describes I don’t believe will happen here. If economic fundementals change then I will change my tune, but until that time Garth is mistaken if he groups Calgary in with Vancouver (abusrd prices), and Toronto (higher prices with much worse economic outlook than Calgary).
Calgary has already lost $60K or 11.9% from the peak. So much for all your babies. — Garth
The lure of quick and easy money and the deadly danger that over leveraged gambled money represents.
>>56 Leftbrain on 09.28.10 at 2:05 am
>>Economics 101: Supply and Demand
>>The market is never wrong, the prices are not too low or too high, they are exactly where they should be.
Economics 101 part II:Price elasticity of demand
Elasticity: the responsiveness of consumers’ demand to a change in price.
Due to perceived over-valuation, great uncertainty in the market in general, unemployment, low savings rate, and over-leveraged mortgages, real estate in Vancouver and Toronto is, in the short term, inelastic. Despite drops in prices, people aren’t jumping at the bit to buy; i.e. sales are low despite dips in price.
Hence, a greater drop in price is necessary before sales can return to “healthy” levels, again. Or the economy needs to recover to the point where people become optimistic about the near future.
Garth, I had the same reaction as you to the criteria for the RBC report (i.e., who puts down 25% these days, anyway?)
But can I ask what your source is for “the average down payment being 7%”? I believe you, but want to know how old and/or what geographical area this figure refers to.
2010 number, national average. — Garth
Hey Garth,
I’d really like to clear this up, hopefully you respond. I’ve been following your blog a lot and find it extremely interesting and useful. Now, someone mentioned this is similar to other guys like “richdad” who had free seminars and pretends to be awesome at investing but then sells thousand dollar “real” seminars where you can get the real info to become rich. Is this at all what you are doing. Is the only thing that you push your book, any other services? I really wanna say I trust your work but then I don’t wanna be one of those guys that drank the kool-aid.
I’ve been following your posts for a couple months now. You often mention certain strategies, buy preferends, bonds a whole bunch of diversified assets but its usually high level stuff…although I should probably talk to a pro to get these things in order.
As a 24 year old with savings starting to build, I wanna stop filling the orange mans pockets but I only become “aware” in the age of the crash. I listen intelligently because I understand what you’re saying… but its easy sometimes if the kool aid tastes good. Please ease my mind here Garth!
I sell nothing but the odd book – twenty bucks. Fell free to ask others who have been to one of my events. You sure are cynical for being 24. — Garth
#1 Grandpa Grinch on 09.27.10 at 10:03 pm
I see them Grandpa, and if Garth does I’m willing to bet like me, he must be careful to paraphrase to protect the source/not bring too much attention – the flow of information would just lock up as there would be a witch hunt for the leak – Garth does carry a bit of a reputation as being an honest guy though so I’m betting his word good. Me? Well – I shoot straight but take it as you will…
#47 sold in 2007 on 09.28.10 at 12:47 am
Did you have fun vultching? We have some clients that have just had a ball recently – in fact the latest shock was an ultra low ball my business partners parents put on one in Orlando (they have many grandchildren who LOVE disney!) – 2 bdrm, 1100 sqr ft, 220 in fees/taxes a month – 25K – at this price they figured they might as well as they were smart/lucky enough to not buy the cottage – that was downpayment money by the way.
7 # This is wonderland
You’ve noticed that even the foil hat set is wondering what you’ve got in your coffee?
and here I thought the “politically correct” movement had been strangled by it’s own tentacles…damn!
“Alan”
prices haven’t fallen here, so they never will.
riiiiiight. SUUUUUURE.
When the drops started, prices did not immediately fall off the cliff in Iceland, UK, Spain, US
So now, it’s started in Canada, prices have not fallen off a cliff, AND THEY NEVER WILL.
Because “we’re different here”
riiiiiiight … suuuuuuuure. whatever you write dude.
Yeah, when the dot – tele – com blew up, Nortel never fell, right? Canadians would NEVER sell a devalued asset at lower prices.
In fact, there’s Canadians out there RIGHT NOW, holding on to their Nortel (unlike the ‘Murricans with their zero value Lucent) who still are trying to get $250 for their Nortel shares.
And $2000 for their Bre-X shares.
riiiiight. Whatever you say dude. Because we’re Canajun doncherknow. It’s different here.
#96 Joe Q. on 09.28.10 at 9:44 am
The average is accurate and by my own numbers here we’ve not seen more than 5% down at my brokerage more than a dozen times in the past two months with 165 deals going through all of our agents…
#56, Leftbrain
Economics 101: Supply and Demand
The market is never wrong, the prices are not too low or too high, they are exactly where they should be. Any object (house, car, diamond, stocks), is “worth” exactly what people are willing to pay for it.
==========================
Except buyers of real estate don’t pay; they finance (with 7% down…).
The only reason why we’re not wheeling and dealing actual white elephants to each other is the lack of government backed EZ financing.
You think the average person is going to pay 330K for the average shack if it required cash in hand? Please.
Funny, is that chunky woman with round face on “Property virgins” show keeps saying that housing is affordable. What right does she have to say it on national TV she is just a realtor not a financial advisor. Why no one tells her that when house is more then 4 times of family income it is becoming UNAFFORDABLE. I bet she knows numbers well and plainly decieves her customers.
She can comment on the house but telling FTB lies is
not in her competence.
Why not make a RE show and have some discussion between bulls and bears on TV and let people decide for themselves who makes more sence.
Obviously, there is reason why there is no such discussion on national TV, I am sure each of you have your own version as to why TV DJs hold it off air, why
CMHC had to insure 2nd, 3rd mortgages of ridiculous prices at taxpayer expense and so manyother questions,
heck why does government has to put its nose in this bussiness at all for that matter, why no one rases these and other ‘sharp’ questions in Canada.
Garth thank you for your will and wisdom to have this
discussion, you might be right or wrong here and there
BUT this is hollow space that MSM refuses to cover unbiasly and you stepped forward to be the one who said enough is enough.
Thank you. Alex.
well it looks like the guy is inquiring as to where the pressure washer nozzle is and he has brought the handle up to show his wife what he is talking about. she doesnt know where it could be as she rarely ventures into the garage anyway….too many spiders and real estate agents .
wondergit mind out og the gutter there eh?
#90 Numbers.
Thanks. Total taxes on $70K would be $16K leaving an after tax or net income of $54K. Then the pre-tax housing cost of $35K is deducted? Shouldn’t it be the after tax cost of housing which would $35K less the taxes already paid of $8K leaving a balance of $27K instead of $19K. Or are total taxes on a $70K income $24K?
og = of
#91 Numbers.
I was quoting Ambrose Evans-Pritchard about the medieval price of gold. That was his research.
But I think you’re right that salt and spices probably were worth a lot, perhaps even more than gold, at some point, since the Silk Road was still being used and a thriving East Indies spice trade, by sea, had not yet ramped up enough to make spices ubiquitous in downtown Europe.
Also, certain spices, along with gold and silver were actively used as currencies, and currency substitutes, long before to the introduction of “paper” money, in various guises, that eventually led to today’s currencies’ debasement. Gold STILL has a good future after all these centuries. Spices are still expensive too!
AS AN ASIDE, gold, silver, salt and spices were the properties of the rich and the Church in those medieval days; the serfs were on the bottom of the heap, of course, just like today’s Brand New (mortgage-drowned) Serfs in our soon-to-be medieval society.
Serf’s up baby!
#85 Victoria Tea Party
Your arguments and those of the Telegraph are quite sound and describe well what is happening today.
Yet, why are people so blind to this gold bull market, while others simply write it off as a bubble?
Gold will be in a bubble when the Taxi drivers and shoe shine boys start recommending it.
Here’s a topic Garth hasnt discussed lately….where the hell is Canada going to find GDP with the CAD almost PAR to the USD. Same can be said for AUD or any other global country trying to sell to the largest consumer in the word…still!
Gold is finally at that pivot point. Gold moves with the dollar, dollar moves with oil. What does unstoppable deflation do to oil?
firefox browser-right click,press reload,presto!!
Thanks Garth,
I have good instincts so I had a feeling you were for real. What you talk about is obvious, sometimes its hard to believe ourselves when everyone else is running in the opposite direction.
I’ve grown up my entire life with everyone trying to sell me something. How can I not be cynical, isn’t that what your blog has thought me? I’ll take that as a compliment :)
Your pictures is fine. Its just depend how a person see things; a glass of water half full or half empty! I see your pictues for what it is; A youg couples who gona have fun together! ahah!
“It did not occur to me when I selected this photo that so many people would be one-dimensional in their reactions. The picture is allegorical. The woman represents our infatuation with physical assets and is an object of desire. The person taking the photo, and for whom she is posing, is the lustful one. Her allure is so great he fails to see the immense threat which just came into his life. She is aware, yet smiles on. How could it be about anything other than real estate? — Garth”
Knew that of course. But you could switch genders in these pictures (probably get more attention), as there are more complains about wife/girlfriend wanting house than otherwise.
#33 Deliverator on 09.27.10 at 11:39 pm
http://www.ft.com/cms/s/0/33ff9624-ca48-11df-a860-00144feab49a.html
“An “international currency war” has broken out, according to Guido Mantega, Brazil’s finance minister, as governments around the globe compete to lower their exchange rates to boost competitiveness.”
Yep, inflation is most definitely in the pipeline.
*****************
Inflation it is-
Inflationary it isn’t-
Big difference–
Deflation rages on–
Re # 56 Left Brain.
If you cannot afford something, but price sustainment suggests others can, that does not mean it is overpriced, it simply means that you cannot afford it.
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Here’s Economics Lesson 102:
Try using the right side of your brain, the left seems to be beyond repair.
Have you given any thought as to how the Big Corporations have squeezed out the little business’, in order to control the market share of whatever the product may be.
Then reducing supply on purpose to keep prices artificially high.
Wait till they start doing this on food over here. Already been doing it in 2’nd/3’rd world countries for a while.
It’s all manipulated to further reduce/ illiminate the middle class.
Get ready for the next chapter of oppresion. It’s called
” The New and Improved Fuedal System.”
They don’t teach you that in economics 101.
Pretty neat EH!
http://www.youtube.com/watch?v=gBzJGckMYO4
“Calgary has already lost $60K or 11.9% from the peak. So much for all your babies. — Garth”
Yeah thanks Garth, I’m well aware.. I already pointed that out in a post about two weeks ago…
Also did you even read my post, I said prices will likely fall, but I don’t see the “melt” occuring.
The fact is we are sitting at 4.2X income for median home prices. If the historical range is 3.5-4 as many have pointed out, then we do not have very much farther to fall. Where is the flaw in that logic??
You think it’s different there? Wait and see. — Garth
Garth– “Owning a home traditionally took a third a family’s income, not half”
And usually one income could swing it.
A spouse could take up the slack if needed in emergency.
Unfortunately today where both spouses are working, and it still takes the occasional raid on the kids piggy bank (future) to stay above water.
#89 BrianT on 09.28.10 at 9:25 am
#81Anne-Gross fails to mention that although the US economy is contracting and will continue to contract for the foreseeable future, the Asian economies are not contracting overall. There is still growth there.
Its all smoke & mirrors Brian….literally a house of cards.
Ever wonder how China can endlessly generate goal-seeked GDP of precisely 8.00001% year after year? Or how it can constantly find use for the massive and ever-larger surplus of warehoused commodities? Simple – never stop building. Which, apparently means blowing up empty building before they are even finished and rebuilding them. Rinse. Repeat. After all gotta keep all those construction workers from rioting, and all those USD reserves redirected into Brazilian and OZ commodities, now that China is not really buying US debt anymore. China Hush has some stunning pictures confirming that in its search of the great home bubble perpetual engine, the politbureau comrades may have stumbled onto the bricks and mortar equivalent of Shangri La. In the meantime, more on the whole “controlled demolition thing” from China Hush.
China’s bizarre phenomena: buildings die unnaturally
http://www.chinahush.com/2010/09/24/china’s-bizarre-phenomena-buildings-die-unnaturally/
Re #97 Sean
Seems like you have a good head on you. Question anything that does not make sense to you, until you find out if it is BS or fact.
Take no ones word as gospel until they have repeatedly proven themselves, usually through their actions.
Nothing out there in general is what it seems to be.
For the most part do alot of your own research instead of relying on others opinions.
As far as Garth calling you cynical, I would take that as a compliment.
Sam
People don’t buy, sell and trade houses like stocks. You can do that for 9 dollars a trade. Buying and selling a home requires you to think about where you are going to move all your stuff to. Family, schools, work, mortgage pre-payment fees, real estate commissions and property title taxes.
The majority of homeowners stay put. Don’t/won’t sell at a loss unless they have no choice. They will continue to pay their mortgages like they always have. The only thing that could provide additional pressure is if interest rates were to double or triple. Or they lose their jobs.
People rent out basement suites to supplement their income and in Vancouver, these places rent out quickly if they are well located. Most recent article by RBC points out that people are at a high percentage of their income to pay for mortgages, but does not take this major statistic into account.
#100 JM in London on 09.28.10 at 10:14 am
I don’t doubt it — do you have any info on how those 5% mortgages break down on new buyers vs. those moving “up the ladder”?
It just continually astounds me how little equity most new buyers have in their homes. It’s like a life sentence. Unbelievable.
“Nationally, income dropped by 2.1% to $50,221 in 2009”.
This is from a CNN article today.
I’m just wondering why Garth repeatedly refers to Canada and US incomes being roughly the same…
Last time I checked $70,000 vs $50,000 is not roughly the same…
Thoughts?
Hi Garth:
I do believe in freedom of expression but this photo you have up is not appropriate. Home invasions are not a joke and this is what I think of when I see a man with a gun in a woman’s bedroom. There is a news story in the U.S. at the moment where 2 armed men terrorized a father, mother, and 2 daughters in their home. Each female was sexually assaulted (the girls were 11 and 17) then brutally murdered by the intruders and only the father survived. And I know that you refer to the Real Estate Industry as “House Porn” but do we really need a photo of a scantily clad woman your blog? I was looking forward to reading what you had to say but now, I will go elsewhere until this photo is down! You are a brilliant writer but this photo takes you to a whole other level and it’s not good.
Thank you.
See the response to #74 for an explanation. And stop watching CSI Miami. — Garth
Any time any of us think that there is a social “reality” and that we KNOW what it is, we need to take a step back and think about the extreme variation in the comments related to this picture.
@ 120 Joseph
Think overall purchasing power.
Asia, a leading indicator: Little Warning Flags From China
“”Anthony Chan from Alliance Bernstein says Chinese order of semi-manufactures from Taiwan have been in “sharp decline”. This is usually a warning signal for the health of China’s economy.
“The indicator – which tends to anticipate China’s overall import growth quite accurately by about two months – has been decelerating for five consecutive months, from close to 60pc (y-on-y) in March to just 8.8pc in August…
Separately, Melissa Kidd from Lombard Street Research has sent a note suggesting that world steel production over the three months to August has been falling at rates comparable to the onset of the Great Recession.
The drops are 7pc global, 9pc in the US, and 13pc in Germany and China. The fall in China is actually faster than it was in late 2008.
Global steel capacity use has dropped from to 73pc from 83pc in April. “The rapid slowdown in global steel production reflects the unwinding of the inventory cycle and weakening expectations of future growth. Soaring iron ore exports are difficult to justify against this background,” she said.
The question from both these notes is whether China is just going through a breather after tapping on credit brakes in a well-calibrated slowdown, or whether something deeper is at work.” ”
Fun times all around:
Headline: “Irish CDS to Record Wides on E47 Billion Euro AIB Bailout”<—-was supposed to be E25 B last week, wasn't it? So hard to keep track, the numbers rise so fast. Story on FT Alphaville Blog posted half and hour before said the AIB (Anglo-Irish Bank) bailout was supposed to cost E 35 Billion. The AIB bailout increased by only E 12 B in about half an hour, by the time stamps on these stories. No worries. At this rate, it will be larger than all assets on Earth combined by Friday. LOL
And those US consumers, so Depressed: Zero Hedge – "Big Miss In Richmond Fed, Prints At -2, On Expectations Of 5, As Consumer Confidence Plunges To 48.5 On Consensus Of 52.4" Canada is tied to the US anchor.
The game is afoot. The specter of Sovereign Default stalks the landscape. Fresh analysis of inter-Bank debt in Europe confirms any 1 PIGS folding will cause the whole house of cards to collapse.
And Then Were None
Currency Wars. Trade Wars. Commodity War. Inflation/Deflation War. The Great Recession rolls on.
The guy is a banker and has come calling with the mortgage papers in his back pocket… well, perhaps front pocket, either way he’s a pretty happy fella .
Let’s just say the picture makes it clear who is in control and… well… um… who is going to get $crewed.
Great post Garth……As for the picture…I read it as a modern day Bonnie and Clyde…He is telling her to hurry up and get dressed…..We need to rob some banks and by us a house. As for the ones screaming rape and murder…Direct those commments at Jim F and M Carney…..You are watching way too much CSI…
#66 Gail
Hi Gail. Love the show.You are Supernanny for the finances. Tell me how do you resist actually spanking some of them?
#107 Basil Fawlty
Gold will actually be in a bubble some time after Hell freezes over.
I’m kidding, of course, but my point is that there will be undulations in the price but the trend is the gold investor’s friend, which means gold heads higher until there is some kind of turnaround in currency debasement.
The markets just about everywhere today don’t know which way to turn. The latest economic reports show the US economy keeps on getting worse and worse.
Someone could make some serious coin flogging worry beads!
The usually amusing photo is, for once, in extremely poor taste. The image of the guy with the gun is not funny. Think about it. Please.
#39 wins the Darwin award. Hands down.
>#36 rory on 09.27.10 at 11:44 pm
>#2 Jeff Smith
>I don’t know if your kidding or not …
Personally I think it’s a little late to back out now. They should have never pulled out the stimulus hat trick in the first place. But now the bunny is out, they might as well let it complete the trick. Putting it back in the bag might not be a very good thing, it’s a little late.
#114 Bill ( Peterborough) on 09.28.10 at 10:45 am
Try using the right side of your brain, the left seems to be beyond repair.
*********************
A little known fact–
The “only” time you ever use both sides of the brain at the same time-is when you listen to music-
Maybe people should exercise their brains on both sides a bit more-it might dampen some of the starchiness in some of the people-who bitch about nothing important-
http://www.youtube.com/watch?v=XJMyA8B4gsg
Jesus H. Cahrist, who exactly do I have to blow around here to get Garth to be more P.C. and sensitive to women’s issues?
~~~~~~~~~~~~~~~~~~~~~
Listen, the problem with porn is there is new crazy gonzo porn that is really perverted. The more porn a guy watches, the more he is desensitized to it.
The more a guy (or immature young man, or even children as young as 8 are exposed to porn on the internet) is desensitized to porn, the more extreme porn he searches out for to get back his high. This leads to extremes like child porn.
snip snip: Fresh off unsubstantiated claims that Canada is a piracy haven, the media is now reporting that Canada is also a “pedophile haven.” At least two groups are quoted in a CTV article claiming that Canada has lax laws and should require Internet service providers to take stronger action against pedophile and child porn sites. Moreover, Conservative MP Art Hanger infers that the law should be changed to require ISPs to report sites, even if they are not illegal.
http://www.michaelgeist.ca/content/view/1978/125/
☻
Great post, but the picture is in very poor taste. Not to mention it has nothing to do with real estate or debt ratios.
Look again. — Garth
#133Soylent-your attempts to intimidate by implying any link between this blog site and kiddie porn are repugnant in the extreme.
The Rhetoric of Repression
Is Garth an “extremist”? The reaction of some of his audience here to his titilating photo would certainly indicate that he is.
It’s important because on last night’s news it was reported that the Obama government wanted to wire tap the Internet because they were hunting “extremists”. The word was used three times, just so there wouldn’t be any confusion. Extremists are communicating on the Internet.
Is a contrarian an “extremist”? Are you? Do you read Zero Hedge, TAE, Denninger, or the like? Extremist views, defined as views exceeding the ordinary, usual, or expected. Do you expect home prices to drop? This is Extreme thinking! Watch it.
At first they were hunting “terrorists”. Then it became “insurgents” – people who opposed the ruling government politic. Now they are searching for extremists.
Make sure to stay average, sedate, quiet. Above all don’t paste links to extremist articles like Counter Punch’s What About the Government? – The Slippery Definition of Extremism
What’s next after the extremists are rounded up? Nimrods, goldbugs, and TinFoilHatters beware.
Watch out seniors
The indictment alleges that Jim Lankford, who is the owner/broker of Century 21-Apollo Realty in Modesto, and Jon Vance McDade, who is Lankford’s roommate, devised a scheme to defraud elderly property owners and lending institutions out of money and property. Specifically, the indictment alleges that Lankford and McDade would find elderly property owners who wanted to sell their property with no listing agent. Lankford and McDade would then induce the elderly property owner to sell their home to one of them and enter into a “straight note” contract for a portion of the purchase price, under which the defendant would make interest-only payments to the seller for five to 10 years, with the principal amount owed to the seller at the end of that period. The defendants then obtained conventional financing to purchase the same properties in the form of a mortgage from a lending institution, but did not disclose to the lending institution the seller-backed financing. The indictment alleges that the defendants would divert the proceeds of the mortgage loan to themselves, and would lull the elderly property owners by mailing them monthly interest-only payments.
The indictment also alleges that Lankford and McDade made material misrepresentations on the loan applications, and in some instances, submitted falsified documents regarding monthly income to the lending institutions. The defendants allegedly caused fraudulent loan applications to be submitted Countrywide, World Savings Bank, GreenPoint, Wachovia, Seaforth Mortgage, Aegis, Sierra Pacific, and Alliance Bancorp.
The indictment alleges that in many instances Lankford and McDade subsequently sought to refinance the property with another lending institution to draw out any remaining equity in the property. In connection with refinancing transactions, Lankford allegedly deceived some of the elderly property owners into signing documents indicating that they had been paid in full. Many of the properties were later allowed to go into foreclosure, or were sold in short sales through Lankford’s real estate business. The indictment alleges that the defendants’ conduct caused losses to the victim elderly property owners, lending institutions, and banks of at least $10 million.
=
This was one of the houses
3331 Wycliffe DR, Modesto, CA – MLS 10067176 – Estately25 Aug 2010 … Custom home, 1000000.00 renovation in 2004/2005. 5 becrooms, 3 baths,Floors are porcelin from Italy, Kitched cabinets are solid cherry …
http://www.estately.com/listings/info/3331-wycliffe-dr–1 – Cached
3331 Wycliffe DrModesto, CA 95355
Recently Sold: $385,000
http://www.zillow.com/homedetails/3331-Wycliffe-Dr-Modesto-CA-95355/16043593_zpid/
Data last changed 09/22/2010
I recently moved to Toronto from US and I am totally bewildered by the real estate markets here.What surprises me most is that the data on actual sales prices is not available to public! Do you folks know why this data is not made publicly available e.g. at the county auditors website or something like zillows.com?
I wonder if a picture of a sexy Tarzan in his undies and a gun-toting Jane would have generated this much controversy. She is a beautiful confident woman and, as a woman, I just don’t understand the fuss. You see more skin on the beach people!!!
i thought the image as satirical
“The subjugation of women. As women were once used as “trophies of war” by barbarians, in modern times, the housewife also served as a trophy to show off a man’s success. By not allowing their wives to take outside professions, a man could show off her conspicuous leisure as proof of his status and spend money on his wife through conspicuous consumption.
The Theory of the Leisure Class is a book, first published in 1899, by the Norwegian-American economist and sociologist Thorstein Veblen while he was a professor at the University of Chicago. In the book’s introduction he explains that much of the material discussed can be traced back to the proper sources by any well-read person. The Theory of the Leisure Class is considered one of the first detailed critiques of consumerism”
http://en.wikipedia.org/wiki/The_Theory_of_the_Leisure_Class
#134 Soylent Green is People on 09.28.10 at 11:41 am
Get a grip people; on the face of it this isn’t porn, at least as I understand it. Had a look at the Sears catalogue lately or the print ads for Victoria’s Secret?
The trouble, I think, is that the genders look at photos like these from [at least] 2 perspectives and none of them can see the pics from the others’ viewpoint. As a female – and I’ll admit to a middle-aged, small c conservative, feminist mind set – I find it offensive. Is she about to be assaulted with the barrel of that 45? Will she be coerced to comply with his demands? Will she be shot after the assault?
Garth can rationalize his choice of pics ’til the cows come home. But I’ll bet most visitors to his blog, and I’m guilty here too, don’t take the time to analyse the artwork. And in this case, without his explanation at post #74, I wouldn’t have spotted the imagery at all.
Hell Hath no fury like the Politically Correct crowd.
AND they are ALWAYS right.
ahhhh for the good old days when you could call a spade a shovel.
yeah, and
in the US
in ICeland
in the UK
in Spain
in Ireland
in Japan
you CAN sell houses like stock right?
You CAN put a house up for sale & have it sold in 10 milliseconds for $2, right?
Alan to world: (fingers in ears)
lalalalalallalallalalla I’m not listening to you”
“IT IS DIFFERENT IN CANADA”
“houses are different from any other asset”
“lalalalalallalallalalla I’m not listening to you”
“CANADA IS NOT LIKE Japan, the US, UK, Spain, Ireland”
Over there you can sell a house in 10 minutes for free, just like a stock
“IT IS DIFFERENT HERE”
_______________
#118 Alan on 09.28.10 at 11:00 am
Sam
People don’t buy, sell and trade houses like stocks. You can do that for 9 dollars a trade. Buying and selling a home requires you to think about where you are going to move all your stuff to. Family, schools, work, mortgage pre-payment fees, real estate commissions and property title taxes.
I’m with #7 and #80 on this one, as I have been with several of the other misogynist pics you have posted over the years.
Quote: “How could it be about anything other than real estate? — Garth”
If that is so, try it in role reversal and see how that works out: make the dominant figure in the pic a semi-dressed male with a large dick and the fully-clothed person coming in the door and reflected in the mirror a nondescript mature woman.
Doesn’t have quite the same irrelevance, in at least a few men’s eyes, does it?
So I guess I stick with puppies and chimps? — Garth
@ # 139 Loneshark21
Your bewilderment is just beginning…trust me. I moved to Alberta a couple of years ago from the states and I’m still in a general state of confusion. They are a different country here…who knew?!?!
There are a lot of other things that you are going to find frustrating (e.g., the cost of living, structure of cellphone/data plans, differences between amazon.ca and amazon.com, the cost of alcohol, the fact that the letter “z” is pronounced like a character in a Tarintino movie).
The upside is that urban areas are MUCH more people friendly than in the States and you don’t have to deal with the idiocy of American politics.
Plan on sticking around and enjoying the place.
What quickly gets lost in these affordability reports is common sense perspective.
33% going to housing costs is the MAXIMUM, not the “affordable” limit. But in the “new economy”, these things have no meaning. One in a set of general common sense guidelines (another is 3-4 times income) gets twisted around into a monthly payment.
When I bought a condo, it was just around the 4x mark, and with a 20%+ downpayment and 25 year amortization (you know, a “standard” mortgage) I was just inside 30% net income, with zero other debts, and I started to feel the walls closing in after a while. And I hardly lead an extravagant and expensive life.
I can’t imagine having to pay 50% or more.
Of course, I could have taken out a 35 year amortization to make my house “more affordable”, but 35 seemed to ridiculous for me to even consider. But that’s what people are doing to afford their mega houses, fiddling with the numbers until the monthly payment comes out right.
I have no doubt large majority of new mortgages in places like Vancouver and Victoria are 35 year. What should have been a tool for a few people in special circumstances to lower their payments, has turned into just another way to pump more juice into housing. As “conventional wisdom” has it, buy the most house you can afford, and with a 35 year mortgage you can afford 20% more house!
With respect to the varied criticisms of the photo…
I agree absolutely.
burn the books…burn the books…burn the books…
…censor the inappropriate…muzzle the artists….burkha the women…ban analogies and allegories…PROTECT US!
Hi Garth, great blog.
What are your thoughts on multi-unit residential real estate (6 units +) as an investment? The government increased the down payment from 5% to 20% which removed buyers from the market. However, values have not come down. I anticipate that with an upcoming rise in interest rates cap rates will also rise and lower values will result. With more people potentially choosing to rent rather than purchase given the upcoming devaluation of real estate this may prove to be a good long term investment within a well balanced portfolio of cash producing assets. Thoughts…
#139 loneshark21 on 09.28.10 at 12:03 pm
——————————————–
Don’t know, but you get up to 100 free searches of selling prices in and around your own neighbourhood at http://www.mpac.ca (you’ll need your user ID from your MPAC statement–if you’re a home owner, that is).
… to the folks commenting on the picture: Get a grip … you are just like the guy taking the picture (missing the point and certainly not seeing the big picture)
And by “30% net income” I meant “30% gross income”..
I find it offensive. Is she about to be assaulted with the barrel of that 45? Will she be coerced to comply with his demands? Will she be shot after the assault?
*********************
Finally-something to take the heat off Goldbugs-
A pic of nakedness-beauty and extreme danger-
http://www.fotosearch.com/bigcomp.asp?path=IMR/IMR388/IE216-094.jpg
********************
What could she be up to?
The inquiring mind wanders-
Could she be stealing her husbands stash?
What might she do with the proceeds?
Will she run off-marry her secret lover and live happily ever after?
http://www.youtube.com/watch?v=9IyRNKleyyg&ob=av2e
Re # 133 dark sad person
Whats even more interesting is how the subconciuos mind can be programmed through repetative conditioning. Subliminal advertising, having so called intellects repeating the same garbage over and over again.
Rule of thumb( with the mind ). Garbage in garbage out. Simple.
It’s all how you choose to program it.
Thats why we have all kinds out there. ( different programming)
http://www.youtube.com/watch?v=-Fulz4ytZ54
___________________________________________
Re # 134 Soylent Green is People.
Jesus H. Cahrist, who exactly do I have to blow around here to get Garth to be more P.C. and sensitive to women’s issues?
******************************************
Never has the devil on one shoulder/ angel on the other shoulder battled so hard to responsed to above comment. lol
Garths on a real mission these days, got to build it up for Toronto appearance.
http://www.youtube.com/watch?v=kkqGLJjQkhc
#133 Soylent Green is People
And marijuana is a gateway drug, right?
Child porn has nothing to do with porn. And there is no amount of porn you can watch that will make you reach for the kiddie stuff, just like pot smokers aren’t shooting heroin into their veins.
Garth, keep posting your pictures, so we can continue to shake out the crazies.
@ #7 This is Wonderful
Talk about comparing apples and oranges. There is no comparison. I think the picture makes a great metaphor, a beautiful woman representing our blind lust for houses and the man with a gun representing the danger of rising interest rates, low savings and higher taxes.
#7, take an aspirin, if Garth wants to post a picture of my old girlfriend on his post…what’s wrong with that.
Self righteous jerk.
#145: “try it in role reversal and see how that works out: make the dominant figure in the pic a semi-dressed male with a large dick and the fully-clothed person coming in the door and reflected in the mirror a nondescript mature woman.”
Look again; the guy in the mirror is buff.
The PC crowd seems to be suggesting that pics of people are OK so long as everyone is ugly. Well, good luck with that. This ain’t the CBC.
Rates are being held down so that we get out there and spend.
Now don’t you feel guilty that your favorite politicians next raise is being held up?
Nothing will save the economy unless you get out there and buy at any cost….buy a house…save a politician. But…while doing that you also screw a senior who is quickly running out of money because of the zero rate policy. What has the government planned to do with all the seniors who will join the ranks of the boomers who need a handout because they’re all broke at the same time?
#139 loneshark21
Hey, REALTORs(tm)(r)(c) need to eat too!
#134 Soylent Green is People
Just noticed this, oh my! I’m gonna go out on a limb, and say that Art Hanger has no clue about how the internet works, which of course means he is uniquely and perfectly suited to regulating it.
If I were a RE Bull I might say that all of the people upset about the photo were just jealous for not owning one (or being one). That and the fact they have to rent one like that while they live in a basement.
Instead I will just say, “get a life”.
I have visited this blog I don’t know how many times today. I decided to comment on the picture and discovered it was a blog about housing or something. Who knew
Great post, Garth.
I love your writing style … lately, I noticed you’ve been going for the jugular vein. Rightfully so. Your warning calls should have been heeded a long time ago.
This real estate party will have horrible repercussions on all Canadians, whether or not they participated in it. The hang-over will be immense.
real world 101: how to think – observe, evaluate, reason.
lesson one: DO NOT wear blinkers.
fantasy world 101: how to avoid using your brain by spouting slogans,
class one: learn to wear blinkers and regurgitate “The market is never wrong”
hey leftbrain: you majored in “fantasyland studies” with a minor in “blinkered thinking”, and then did graduate work in “willful ignorance” and “toeing the party line”
____
#56 Leftbrain on 09.28.10 at 2:05 am
Economics 101: Supply and Demand
wacka wacka hubba hubba
The person taking the photo, and for whom she is posing, is the lustful one. Her allure is so great he fails to see the immense threat which just came into his life. She is aware, yet smiles on. How could it be about anything other than real estate? — Garth
******************************************
If we are seeing this through the eyes of the photographer, how come he doesn’t see the reflection in the mirror of gunman Garth.
Allure or no allure a gun always trumps infatuation.
By the way I have submitted all your comments from the past 6 months, as well as blog photo’s to a good freind of mine in Vienna, to do a phycological profile. ( he is a well known psychiatrist).
I talked to him today to see how he was coming along with profile. I was informed that he had a team of his of colleauges working on your profile. Imagine that.
By the way where’s TheBigLebowski.
Great pic, and great message: house lust will get you screwed, one way or another. As for the PC crowd here, lighten up.
china view
http://seekingalpha.com/article/227167-china-s-bubble-you-ain-t-seen-nothing-yet
Can’t decide which are more fake… her boobs or his, uh, gun… and you old nellies complaining about the pic… what the HECK did you do in 1962 when the first James Bond flick came out, faint dead away?
Seriously.
yesterday recommended your site to a stranger that was asking if i thought housing prises were going to rise or collapse. I hope that she visited your site yesterday, because she might have thought I gave her a porn site link with the picture you chose today. Scantily clad woman, talking about eHarmony…. yikes, thanks for making look like a pervert! ;) I hope I don’t see her again.
when you say household debt to income is at 145%, does that mean total oustanding mortgage debt compared to after tax income for one year. I think 145% sounds a little low if that is the case.
When are you coming to Calgary? You might have to rent out the saddledome by then….
Are there that may perverts? — Garth
off topic but necessary – please put this in Garth
I canNOT believe anyone still believes in this subliminal advertising cr*p*la.
http://www.snopes.com/business/hidden/popcorn.asp
http://www.google.com/search?client=ubuntu&channel=fs&q=vicary+subliminal+recanted&ie=utf-8&oe=utf-8
Figures that a Mishie would believe it though. (next up: the Mishie will redefine “subliminal” to mean something else and declare himself the winner. I know I shouldn’t have written that, it may prevent him from doing it … )
Hey Garth, here is little info on where the word “mortgage” comes from> I know you will like this!
MORT is from the word mortise meaning DEATH.
GAGE has the meaning GRIP
DEATH GRIP, the golden handcuffs that enslave people and make them live paycheck to paycheck.
#109 – Try me
Thanks, that worked.
Photo:
How come when Garth puts a sexy shirtless man on nobody says anything. Isn’t that strange hmmmm.
By the way – I am a female.
If lists are outpacing sales in Vancouver it may suggest the market is not clearing, that is equilibrium price is actually lower then where people are price setting. Suggests th demand curve is shifting in and to the left. Seems very logical for all the reasons posted here. Some people will have to sell, and will thus have to lower their prices. If events play out as they did here in the U.S., the demand curve will continue to move to the left, supply will start shifting to the right as more folks are forced to sell, and prices will drop. I think I am going to see how far they drop before I invest.
The “foreign investor” is The only credible argument I have ever seen posted here about demand support, but it is flawed because it assumes foreign money is “stupid”. It is not, and will dry up the moment the upward price trend reverses which I believe has already occured. The tragedy in Canada is that Canadians are going to have a hard time walking away from bad RE investments, the foreign investors might not.
#15 grumpy
You are so right. I spoke before about my mother-in-law having to go into a dementia care home. She is getting 0 interest on her capital and we are worried how we can all afford this.
Dear this is Wonderland
#7
You are a tree hugging politically corect moron: Get a life and get off this blog
so if all this shadow banking goes on in China
china loan shark
http://www.lnnews.net/html/20
Special Report- The Secret Engine Behind China’s Housing Bubble …17 Jun 2010 … The hunan jishou city riot was covered up, but no one told the true story. … Under the government support and the funds from local banks, …
seekingalpha.com/…/77200-special-report-the-secret-engine-behind-chinas-housing-bubble-the-ponzi-shark-loan-finance – Cached
LOL #174 Surely you and your female friends do not sit around discussing men’s breast size, complete with hand gestures!!!
#172 Clayton Lesoway
Where does “amortization” come from?
Aren’t you glad you’re no longer in politics? Any pressure mounting for a public apology press conference? Have your press secretary and publicist been informed of the career damaging photo? Spin doctors being deployed as we speak? Can you still reach Elliot Spitzer by phone?
I have no career. Shove off. — Garth
http://www.theglobeandmail.com/globe-investor/personal-finance/what-would-you-do-to-burn-your-mortgage/article1728943/
Damn good television!
#155Devore-maybe Solyent is right about the gateway stuff-that is why the Amish don’t do it standing up-it can lead to dancing.
Next time pepper your presentation with some pictures like the one from this blog. When I saw you in Kamloops the only pic I remember is one of a naked guy!
wow, give Garth a break people. The man has a sense of humour. I thought it was funny. You go, Garth.
# 174 What I find funny is, the many times Garth has posted a picture of a seriously obese, shirtless man and no one says anything.
It’s called a honey trap and some of your neighbours are most likely entangled.
To all the nambie pambies offended by the photo.
Show us on the doll where the bad man touched you!
jeez get a life.
Jebus, yesterday it’s the gold bugs and today the anti-prawn crusaders. It’s called a metaphor. Step down Good Christian Soldiers.
Oh, and one thought on foreign investors; what kind of foreign investor is going to buy into an inflated Vancouver market when property can be bought for chump change in virtually every US State including getaway hotspots like California, Miami and Florida? Good luck with that.
Bill Gable: Canadian Centre for Policy Alternatives
your link didn’t work I got something about USB mouse
again the bit by Elizabeth Warren talks about the Collapse of the American middle class which is entirely relevant to Canada. Once I find the link I could see if it supports my argument
http://www.youtube.com/watch?v=akVL7QY0S8A&feature=related
could you post the link again please
Please remove the pic, the gun part is really not appreciated.
—————————————————-
and you are? This is his blog. Sounds like a lot of spoiled people that take free information for granted. You people see something you don’t like and the alarm goes off. I hope you all say thank you for the free posts you agree with in the future
Everyone just have a sense of humour. WHY SO SERIOUS!!!!!
oh and if you don’t like what you read or see, don’t click on the blog. There’s no paid membership here.
For all the “politically correct” people reading this blog,
the guy in the picture is holding a hair dryer.
#120 Joe Q. on 09.28.10 at 11:02 am
You might be surprised at this but at my firm there is a cabal of us chasing property virgins to the side here. We are asking first timers to sit on the sidelines and wait it out. Surprisingly, there are a few decent RE agents here that have caught wind of things we’re up to (a few unscrupulous ones have called for heads on a platter) and joined our line of thought.
Sorry was writing “off the cuff” earlier though – 2/3 of that number are refinances (some from referrals of newbies as a bright spot) and don’t count – sorry for the confusion so to break it out a little more for you as I’m now actually working with the numbers not from memory:
53 New purchases last month:
14 had no CMHC insurance so at least 20% down
of the 40 remaining:
19 were previous home buyers but had taken equity on the previous sale to do various things from invest to pay off credit cards (majority) to buy sports cars –
10 were new combination families with programming to buy while the rates were good (some of these were my actual clients, 2 of whom “put me in my place” about me just being a mortgage agent)
11 were first time home buyers, 10 of those in St Thomas where we have an agent working with a realtor where things have already been eviscerated. It is their personal contention that the worst (true or not) has already happened (Closures include Sterling Trucks and associated plats with St Thomas Ford already announced for this time next year…) and doesn’t have much further to fall…Time will tell there I think.
The brightest spot we’ve seen is the younglings actually seem to be getting the “home ownership is boat anchor” message – a small ray of hope possibly?
Stat of the day:
North Vancouver, over the past 30 days, has had a total of 152 Price Reductions on 456 Active Listings (for detached homes) vs. a whopping 1 Price Increase over that same period.
Also – another stat: 31 sales against 456 active listings = almost 15 months of inventory!!!
(4 to 6 months is considered a “balanced market” I believe)
http://www.yattermatters.com/2010/09/community-snapshot-series-north-vancouver/#more-21337
“Notice I did not include ‘savings and investments’ because, of course, there’s no money left.”
I didn’t see any deduction for utilities.
Geeez Garth, ya can’t win lately… How bout we all cut the man some slack and try to learn about what he’s sharing with us. Does economics and our life savings plan have to be so dry and boring. I personally appreciate the creativity, writing style, etc. This is way too important to get hung up on a woman in her pj’s…
…and they are nice pj’s…
Soylent Green is People
~~~~~~~~~~~~~~~~~~~~~
You might want to ease up on the blasphemy. I didn’t come to this site to see you take the Lords name in vain. I also take issue with your sexual innuendo, with reference to fellatio.
*sarcasm off*
Actually I just find you tiresome and trite
In its first year of implementation, the Economic Action Plan has delivered over $33 billion in stimulus to the economy.
http://actionplan.gc.ca/eng/feature.asp?pageId=180
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Canada’s Flaherty Says Government to Protect Recovery
Sept. 27 (Bloomberg) — Canadian Finance Minister Jim Flaherty said today that his government would “protect” the country’s economic recovery while working to reduce the deficit.
“As the recovery becomes more secure we are working to make sure that federal stimulus winds down,” Flaherty said, adding that he would “take action as necessary to protect the economic recovery.”
Flaherty was speaking in Montreal today after releasing a progress report on the stimulus program that showed it boosted Canadian economic growth by an average of 1.5 percentage points each quarter since the second quarter of last year and created or helped protect about 200,000 jobs.
**********************
So 200,000 jobs for 33 Billion (with a B)
Works out to–
$165,000/per job—and—
some of the 200,000-were only “saved” jobs–
Wonder how much more (Economy recovery protecting} F plans on ?
And all the while-reducing the deficit–
Something tells me-this is not real profitable or too likely to help reduce the deficit-especially when we know-we ain’t seen nothing yet-
I’m a woman and this photo is no more offensive than a Sears catalog. Oh, but there is a man with a gun. I’m reminded of a 1970’s era James Bond movie. The horror!
People need to get a grip.
The new regime at FTC intends to increase the amount of enforcement action taken against food and dietary supplement advertisers,”…
i hope this will extend to labeling
http://www.nutraingredients-usa.com/Regulation/FTC-bombs-POM-and-researcher
http://www.ctv.ca/generic/generated/static/business/article1729066.html
Watchdog cracks down on pomegranate claims – The Globe and Mail27 Sep 2010 … The FTC also said that it had settled a complaint against Mark Dreher, POM Wonderful’s former head of scientific and regulatory affairs, …
http://www.theglobeandmail.com/…/marketing/…pomegranate…/article1729066/s-beware
Phew!!! I want real porn here!!!
re: Calgary birth rate
Calgary’s got SO MANY BABIES!
FOUR HUNDRED BABIES! Er, sorry, I meant
TEN THOUSAND BABIES!
I hope those 10,000 babies are all going to buy
houses immediately, since it’s the only thing
that’s going to prop the market up.
Sad part, they’re already mortgage pre-approved.
It was a pleasure to shake your hand today @ the Hasty Market, Peter.
Likewise, Peter. — Garth
Sorry – Typo – should have read 54 new
As a Toronto elite reflecting on the plight of the latest crop of F.B’s I see the picture as a pictorial allegory of the world as it is . To complete the allegory in a truly meaningful way the bloggers on this site need to see the next, and hopefully continuing pictures of this important expose showing the harm that the P.T.B have imposed on the sheeples. Garth, I look forward to the unwinding of this educational enlightenment, in picture form, over the next few sessions. Freedom demands it.
#194 T.O. Bubble Boy,
North Vancouver prices going down? Can’t be.
Where is old Nostradamus Jr.? He must be having a bad day.
#183 BrianT,
LOL! Oh the unpardonable sin of dancing!
–
#91 Numbers. — “. . . salt and simple spices were worth much more than gold.”
Food, water and shelter are following on from that trend. If I weren’t so physically useless (partially blind in both eyes, deteriorating and paralyzed on the right side), we would have bought some land when it was affordable in the early ’90s, and had a hobby farm.
Self-sufficiency and bartering are excellent lifestyle choices.
#108 Onemorething — “Gold is finally at that pivot point. Gold moves with the dollar, dollar moves with oil. What does unstoppable deflation do to oil?”
Now, just suppose (looking through rose-colored glasses in a Pollyanna world) that gold and oil begin leaping into the stratosphere, the greenback drops into hell (not that far from here), what will life have become?
#114 Bill (Peterborough) — “Try using the right side of your brain, the left seems to be beyond repair.” — Good one!
“. . . as to how the Big Corporations have squeezed out the little business’, in order to control the market share of whatever the product may be.”
No doubt the small- to medium-sized biz. owners have felt the squeeze for several years now, with RCSuperstore, Costco and WalMart taking a fair share of market change, but the Okanagan has a lot of fruit / veggie stands, often in the middle of nowhere and they slightly above supermarket prices for their products, all of which are infinitely more tasty than the store bought stuff.
#137 PTDBD — “The Rhetoric of Repression”
Reminds me of Monty Python In Search of the Holy Grail — Help! Help! skit!
#143 CrowdedElevatorfartz — “Hell Hath no fury like the Politically Correct crowd. AND they are ALWAYS right.”
Personally, I prefer hell to these sado-masochistic ninnies who can’t tell the difference between a square and circle.
Give them lots of time and space. They need it!
#171 Sam — Re: Snopes. Not as accurate as believed.
#190 Confused in Victoria and #200 prairie gal — Right on — lighten up and chill, y’all! “The horror! People need to get a grip.”
Well-here’s a different set of-F saves Canada numbers-
Take your pick i guess-no one seems to know and if they do know-they don’t care–yet
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OTTAWA — The federal government says virtually all of its two-year, $62-billion Economic Action Plan has now been committed and the plan played a key role in creating 430,000 new jobs since July, 2009.
http://money.canoe.ca/money/business/canada/archives/2010/09/20100927-112357.html
*************************
Oh-this is so much better–
62 Billion (with a B)
To “create” 430,000 jobs-works out to–
$144,186 per job/year
Now the year is up-the money is spent-
What will continue to hold these 430K jobs together?
Let me guess–
Another 62 Billion (with a B)
Re # 199 dark sad person
******************************************
How the government works on a much simpler level.
EXAMPLE A)
Selling Toothbrushes
The kids filed back into class Monday morning. They were
very excited. Their weekend assignment was to sell something,
then give a talk on productive salesmanship.
Little Sally led off: “I sold girl scout cookies and I made $30,” she said proudly,
“My sales approach was to appeal to the customer’s civil spirit
and I credit that approach for my obvious success.”
“Very good,” said the teacher.
Little Jenny was next:
“I sold magazines,” she said, “I made $45 and I explained to everyone
that magazines would keep them up on current events.”
“Very good, Jenny,” said the teacher..
Eventually, it was Little Dalton’s turn.
The teacher held her breath …
Little Dalton walked to the front of the classroom and dumped
a box full of cash on the teacher’s desk and smugly said: “$2,467.
“$2,467!” cried the teacher, “What in the world were you selling”
“Toothbrushes,” said Little Dalton.
“Toothbrushes,” echoed the teacher, “How could you possibly sell
enough tooth brushes to make that much money?”
“I found the busiest corner in town,” said Little Dalton,
“I set up a Dip & Chip stand, I gave everybody who walked by a free sample.”
They all said the same thing, “Hey, this tastes like dog shit!”
Then I would say,”It is dog shit. Wanna buy a toothbrush?”
“I used the governmental approach of giving you something
shitty that they say is good, and then making you pay to get the shitty taste out of your mouth.”
Don’t you just love little Dalton and what he has done to Ontario now that he is all growed up!
Why is BMO being so much more aggressive on their advertised 5 yr fixed rate than the other Big Canadian Banks. Hmmmm.
#207 junius
…Where is old Nostradamus Jr.? He must be having a bad day…
Nost said that he would leave this site if his 50% North Van price increase didn’t materialize.
I thought the photo was her husband coming home and upset because the absent minded house lust wife pushed him/them into a spiraling realestate market that will not end well.
So from a vultures perspective are the cameraman and the gunman working together?
Hey Garth!
Any plans to come to Ottawa and help end the crazyness there too? (Of the housing kind, I don’t blame you for giving up on the political scene).
Devore…(from the last forum). Thanks for the response, appreciate the information.
I’ll talk with over with my Canadian Tax guy, as well as re-read that chapter of ‘Money Road’
Why cant i read the rest of comments
Garth please take down the image of my wife.
She’s real busy. You are the third one today. — Garth
#211 Bill
I know we don’t see eye to eye on everything but on this all I can say is alot of truth is said in jest. ROTF!
–
A tad hypocritical, non?
Where Is My Global Warming, goddammit?! Snow in UK wrh.com is right when it said the elite are well aware that GC is also happening quickly. Fool me once . . .
Global Governance PDF format.
Big Bruv Article is interesting.
4:35 clip Poverty In The USA (increasing).
Proof the US is losing influence.
Meatballs in Asteroids Coming close in a few weeks!
Money Honey “The bad economy is all YOUR fault because you won’t give us that last half-penny hidden in the tea-cozy!” wrh.com.
KFC Tariffs? Be still, my exploding heart!
The EU tells the UK it MUST give welfare to migrants. That is what is happening here, and what the elite want — a serf system, with sheeple totally dependent on their masters.
5:49 clip Bullion banks losing control of Gold and Silver. Plus — Post-Election Collapse? More and more dots are being connected.
God how i love the Icelanders–
Can you feel it coming H-F-C?
**************************
Reykjavik, Iceland— The Associated Press
Iceland’s former prime minister has been referred to a special court, a development Tuesday that could make him the first world leader to be charged in connection with the global financial crisis.
Lawmakers voted 33-30 to refer charges against former prime minister Geir Haarde for allegedly failing to prevent Iceland’s 2008 financial crash that toppled the government, brought protests and crippled the national currency.
The special court has never before been convened. The court handles cases in which the parliament, the Althingi, decides to act against ministers on their handling of duties.
http://www.theglobeandmail.com/news/world/iceland-refers-former-prime-minister-to-court-over-bank-crisis/article1730460/
Can you believe these arrogant (insert word here) elite fatcats? Now they are kicking savers in the ass end and almost blaming THEM!
UP YOURS.
We’ve been the responsible ones.
http://www.telegraph.co.uk/finance/personalfinance/savings/8028884/Savers-told-to-stop-moaning-and-start-spending.html
Dear Garth,
I do find your articles intelligent and funny, thank you. The choice of pictures is excellent, adding much deeper understandment. The one that’s published today is no exception. Especially, due to the number of complains. It does show how easy to ignore a point – most don’t even see yourself in the picture (as a subject who’s so blinded by “assets” that completely in denial to see the obvious danger. But of course, “what is essential is invisible to the eye”.
Hmmm, Garth Turner is right, people here don’t read.
p.s. Speaking of HarperCon, did you know:
On Aug. 22, 2010 , Stephen Harper announced it agreed to pay $130 million to Abitibi for hydro dams and other assets the province expropriated.
The Abitibi suit was filed in February 2010, more than a year after the province expropriated the assets.
Clarkson said the settlement caught him off guard.
“I was surprised that they would settle so early,” he said, adding that Ottawa could have dragged out the process for years. “Why not? For one thing, it delays having to pay. You have legal expenses, but there’s so much obstructionism that you can carry out during a legal procedure.”
http://pushedleft.blogspot.com/2010/08/stephen-harper-again-shows-that-multi.html
It used to be that we fought against multi-nationals on behalf of our citizens. Now we are being asked to fight for multi-nationals, regardless of their impact on our citizens, our environment and the well being of our country.
☺
Oh for crying out loud!
The woman is young and presumably has no problem hearing the sound of her door being opened or the footsteps of a person entering the room and yet she beams delightfully.
There is no worry or look of concern on her face. She knows what is at her door but does not recognize the danger. Instead she looks with blissful ignorant vanity into the camera and smiles sweetly as her home is being threatened. She typifies newbie real estate buyers and symbolically represents what we all dislike about the many people we warn daily.
We are not shouting “Lock your doors”! but the message is the same. Instead we cry out “Dump R/E before it’s too damn late,…get out,..get out now..!!
And so we dislike people who hear with their ears but understand nothing of the words that entered their minds nor the real danger lurking on their very doorstep.
I think this is a perfect R/E allegory.
(OK, that was fun. Even if it really didn’t mean a damn thing. Let’s all do physchology 101 more often. We can all try to interpret the meaning of blobs of ink on a white paper and look like fools doing it.)
#200 prairie gal
I’m a man and this photo is no more offensive than a Sears catalog. Oh, but there is a man with a gun. I’m reminded of a 1970′s era James Bond movie. The horror!
People need to get a grip.
Re # 221 JM London.
Thanks.
Garth,
Your insights are great. I don’t think soft-porn photos like house lust really add to your ideas. I enjoy sharing your wisdom with my wife, and it is somewhat offensive and off the point to include such pictures. Keep up your good ideas!
It really is different here in Florence, they have Michelangelo and Da Vinci, I also noticed that no one here is crazed about houses, it’s just a place to live, imagine that… Good to catch up Garth I’ve been off the internet radar for the past week I just got caught up to speed. I had a six hour stop over in Toronto where I met up with a friend renting a great apartment twice the size of what he could buy and his wife is starting to pressure him to buy, he’s holding firm on waiting and I told him he’s doing the right thing. Not everyone in Canada is diving off the deep end. It’s just too bad they are usually the ones who end up footing the bill like what happened in the States. Ciao
228 Timing is Everything on 09.28.10 at 10:04 pm
#200 prairie gal
I’m a man and this photo is no more offensive than a Sears catalog. Oh, but there is a man with a gun. I’m reminded of a 1970′s era James Bond movie. The horror!
People need to get a grip.
………………
Totally agree, and I’m a 60+ woman.