Soft landing

Not long ago a 177-unit condo building came to market in Toronto. Unbuilt, of course. Occupancy next May, maybe. Prices averaging $450 a square foot, plus $25,000 for a parking spot.

So, a one-bedroom unit of 600 square feet sells for around $275,000 with a place for the car. The building’s in one of the slummier parts of the downtown core, where walking the dog after dark is always an adventure. Unless it’s a really big dog with a bad tude. Condo fees on this unit are $325 a month. Taxes about the same. The floors are laminate. But the kitchen countertop is granite.

All this might not be too interesting, save for two facts: The suites were 95% sold within days of going on sale. And, say people familiar with the project, nine of ten buyers were Asian.

Real estate in Toronto, a mega-market of six million people, is entering a critical phase. On one hand there are these kinds of home runs for some developers who’ve tapped into a cultural lust for property in a hugely multicultural city. On the other hand, there are clear signs the housing market’s in definite trouble, despite what the local cartel bosses say. Almost like there are two separate and distinct markets emerging – which means one set of people is going to be very unhappy with 2011.

After all, they can’t both be right. Either those buying condos on spec are playing the futures market and taking a consequently huge gamble, or they’re geniuses. Either the people shunning resale homes and forcing down sales to avoid the inherent danger of an overvalued asset are prescient, or they’re losers. Somebody’s ox is about to be gored.

Interestingly enough, the latest numbers for the resale market in Toronto apparently make a lie of the great ‘come-back’ media release CREA dumped on the nation just days ago. You remember the one? Sure ya do. That was about month-over-month sales in major markets showing a rebound, which led bank-employed economists and condo-dwelling editors to lay down palm leaves and order a donkey.

As reported earlier on this pathetic blog, said TD Economics’ Pascal Gauthier: “If you’ve ever wondered what a soft landing in housing looks like, this may well be it.”

And here it is. Sales of homes in the GTA fell by 16% in the first two weeks of this month. That means if the pattern holds (and it will), November will mark the fifth consecutive month of year-over-year declines. Sure looks like a trend to me.

In fact, as I keep trying to tell people (and I think I’m going to stop soon), sales numbers are vastly more important than sales values. That’s because as fewer buyers show up, fewer homeowners list their homes, thinking they’ll hold out for the multiple offers and hormonal young buyers who always show up during the Spring housing rutting season.

So with a drop in listings, fewer sales can occur, but average prices still advance. Remember that the bottom end of the resale market (in Toronto, below $350K) – where the smart people live – has cooled off dramatically, while the higher end (where Sherry Cooper lives) is still recording modest sales. Thus, the average price gets goosed higher, even as the bird is plucked.

As the real estate board prez explained it: “The number of transactions remained high relative to new listings through the first half of November, promoting a healthy rate of price growth compared to last year.” Indeed, the average GTA house is now trading hands for $437,554, up about 5% over this time a year ago.

So, back to our dilemma. Who’s right? The condo-snapping families who believe real estate is real wealth? Wary buyers convinced the bubble’s about to burst? Homeowners salivating at a renewed bull market in March? Or a growing squad of US economists, who point north and whisper, ‘take cover’?

I guess if fools find greater fools to sell to, then the market’s irrelevant. If you really need a house to save your spouse, there’s no choice. If your family’s about to disown your sorry renting ass, then dive in.

But I’m sticking by my rules. Keep your house equity to a third of net worth. Keep your emotions in your pants. Keep liquid.

Unless, of course, you run into MissyBunny.

123 comments ↓

#1 T.O. Bubble Boy on 11.18.10 at 10:31 pm

Funny how the 2 stories are actually connected: the bottom-end of the housing market is cooling off precisely because of the stupidity in the low-end of new home/condo sales.

People would rather buy new with those shiny granite countertops in their bathroom than buy “slightly used” with engineered counters at a much lower price/sqft.

#2 Contrarian Canuck on 11.18.10 at 10:31 pm

Hey Garth

Very interesting that you would cover these two topics today. Both are being discussed around the blogosphere also

The ‘soft landing’ prediction for Canadian real estate debunked-

http://financialinsights.wordpress.com/2010/11/18/the-soft-landing-thesis-valid-but-highly-unlikely/

Rich Asian investors back in the news-

http://financialinsights.wordpress.com/2010/11/15/rich-chinese-investors-back-in-the-news/

Do you think the rich asian thing will be enough to keep TO and VAN prices firm through next year?

#3 Kevin on 11.18.10 at 10:45 pm

Every major market in this country has strayed from their fundamental values. It was not incomes, as house prices at least here in Saskatoon, have increased 3 times faster than incomes over the last 12 years. It was not savings, cause that is in toilet. It has always been credit and if people still have an appetite for more credit, prices will go up or at least stay flat. In the last decade, Canadians have gorged on debt like it was their last meal. Most of the western world had the same thinking about debt.
It really is only a matter of time.

#4 Jon on 11.18.10 at 10:50 pm

It seems you write your blogs on emotion.

Are you hitting on me? — Garth

#5 BDG-YYC on 11.18.10 at 11:12 pm

All the signs of what in the market would be a distribution top. The smart money is pumping like hell and selling into the froth … the last of the dumbasses to cream off thier profits to the bag holders. This is liker the final run of the penny stocks by the dumb money trying to catch up on a run that’s left them behind. Such a tired game that never loses its luster. Quality runs … sell it … buy the crap … just ahead of the lambs … hold … sell … rinse … relax … have a smoke … repeat. Amazing how the lambs just prance right up … time after time … generation after generation. Notice that its a rush to crap. These are marginal buyers trying to make a hundred bucks in real estate. Hope they are into education because they are going to get some special ed … from Bubba!

#6 Timing is Everything on 11.18.10 at 11:21 pm

Ont. electricity rates to rise 46% over 5 years
(and bribe people with their own money)

http://www.cbc.ca/money/story/2010/11/18/ontario-duncan-economic-update234.html

Are folks in Ont. getting a 46% pay rise over the next 5 years? (Those that are lucky enough to be working that is) Get used to it… or tax revolt, anyone?

Get off the grid as much as you are capable.
Be self-sufficient as much as you are capable.
Get out of the city and cookie-cuttter burbs. Try to live ‘just out-side their tax grabbing ways’.
You are ‘sitting tax-ducks’.

And renting ain’t gonna help much, the costs will just be passed on to ya all.
———————————————————–

Is it legal to kill Squirrels in Ontario?

http://forum.canadianwoodworking.com/showthread.php?p=256880

#7 Jeff Smith on 11.18.10 at 11:22 pm

Looks like a baby! baby boomer! :)

#8 Yellowknife Fever on 11.18.10 at 11:26 pm

OMG! Yellowknife is the next big thing! Prices are up 80% Year-over-Year!

Oct 09 – $196,847
Oct 10 – $352,869 (+80%!!!!!!!!!!!!!!)

Straight from the Horses Mouth! http://www.crea.ca/public/news_stats/statistics.htm

HURRY! Because at the current booming 80% return on real estate in the well placed, economically super advanced worldly mega city of Yellowknife, average real estate prices will hit $3.47M in 2015 and $70M in 2020, and by 2030 every Yellowknife Real Estate Tycoon will be worth a well-deserved $25 billion.

#9 Jeff Smith on 11.18.10 at 11:30 pm

If they can keep the condo games going for a while, might not be a bad thing. If they can create a huge amount of condos, it will surely keep rents in check.

#10 TheBestPlaceOnEarth on 11.18.10 at 11:33 pm

A timely piece demonstrating the power of Asian buyers. Will 2011 be bad for Canadians -for some yes. For Asians an emphatic No. Housing makes up about a tenth of an Asians revenue stream, they are responsible. Make no mistake about it Home Ownership is very important to Asians. They will NEVER ever rent unless it would be for a short time. For example while looking for Real Estate. The tragic part here is for Canadians not in the market or not buying, they are getting older and soon won’t be able to get a mortgage due to their age. Canadian homeowners who’s children rent are depressed at their child’s future while the Asian parent is proud socking away enough money to buy each one of their children a home with cash. The market will never crash in Vancouver, the demand is incredibly high. Oh yeah as to why the Olympic Village failed, renters, no one likes getting bed bugs. Up Up and Away!!!!

#11 Robert on 11.18.10 at 11:43 pm

I had to re-read this little gem from CMHC a few times, all the while choking down my bile. Not only have they been luring the unwashed and under-waged into the party, but it appears they’ve been subsidizing non-residents to pump up the bubble as well !!!!
http://www.cmhc-schl.gc.ca/en/hoficlincl/moloin/hopr/upload/CMHC-Newcomer.pdf. . So the brilliant scheme has been to invite the world in to play at our table, but bankroll them with CMHC cash.. Freddie and Fannie are pikers in this game. We are such dupes – should beating down the doors to have CMHC’s wings clipped and senior management cashiered..

#12 Nostradamus Le Mad Vlad on 11.19.10 at 12:14 am


“Almost like there are two separate and distinct markets emerging – which means one set of people is going to be very unhappy with 2011. . . . nine of ten buyers were Asian.”

Savvy, smart would-be buyers, whether they are Asians or vultures are those who are more than happy to sit and wait, which leads to the very unhappy people who bought in at the top end with little or nothing down. Then they will lose it all. Keeps lawyers busy, ‘tho.

“. . . the great ‘come-back’ media release . . .” — Wasn’t it Goebbels who said during WW2, “. . . if you tell a lie long enough, people will start believing it.”?

That’s all the RE boards are doing — propaganda pumping, pushing their own agenda to boost sales. If people choose to believe them, that’s their choice. A reality check hurts sometimes.
*
What happens in rust-belt areas. Detroit and Cleveland are on fire and no better in Leprechaun Limerick Land.

Mexican Refried Beans and Canadian Bacon.

Ireland, as per Poland has bowed to the IMF henchmen.

JPM Seem to recall that name from somewhere. Maybe in a past life! First three (short) paras. are quite interesting, specifically for the $ amounts.

Takes an English paper to show the difference between the rich and poor in the US.

Passenger rage and complaints increasing.

Fish ‘n’ Chips “Codex is merely another tool in the chest of an elite group of individuals whose goal is to create a one world government in which they wield complete control. Power over the food supply is essential in order to achieve this.” Here is the reason for soaring food prices.

Soros bankrolls Obama which leads to this.

Avoid vaccinations — don’t get borned!

Five Myths of the US Fed.

#13 Yellowknife Fever on 11.19.10 at 12:22 am

#10 TheBestPlaceOnEarth

Yes! Vancouver will go up forever! How much do you think the Asian Real Estate Tycoons will be worth in 2030? I just purchased a WICKED Mansion in Yellowknife brother! It’s closing next week, man I can’t BELIEVE that I only paid $369 for this badboy!

http://www.cbyk.ca/featuresheet.php?photos=22546

It will be worth EASILY $10 million in 2015!! HAHA IM LAUGHING ALL THE WAY TO THE BANK!

You should get in on Yellowknife brother, once the Asians discover it, WOW BAM! EASILY 200-300% APPRECIATION PER YEAR, TO INFINIITY!!

#14 Anotherlowlyrenter on 11.19.10 at 12:31 am

Anyone who has any knowledge of the Hong Kong property market will know this: Asian speculators are as manic depressive as the rest of us. They know how to ride a trend up — and they know how to get out on the way down.

It’s never a good practice to depend on rich foreigners to support your market…

#15 Thetruth on 11.19.10 at 1:17 am

They’re buying condos because of increasing rental demand. 520,000 per year…need I say more?!

#16 nonplused on 11.19.10 at 1:24 am

#8 Yellowknife Fever

Ha, ha, I like your play with exponential functions. I have done them myself, even pointing out that a 2% property tax in a zero inflation environment means you give your house to the government every 50 years, and if there is a 2% inflation combined with a 2% property tax the time to repurchase your house is less than 35 years.

Ha, ha, the dream of property ownership. What a joke. The only entity that owns anything is the government. And they are owned by the banks. Everyone else is a renter, whether they are on title or not.

Owning seems like a good idea, until you realize that by the time the mortgage is paid off the property taxes are about the same.

Don’t believe me? Find out what the mortgage payment was in 1970 compared to the tax bill on the same house now. The taxes are lower, but not by an order of magnitude. We are splitting hairs here, $270 vs. $170 per month. But the house is now old and decrepit. It needs work.

The socialist program is a failure. All attempts to get something for nothing from the government have resulted in the situation we find ourselves in now. We are going to get close to nothing for everything.

#10 TheBestPlaceOnEarth

Are you for real? I know lots of Chinese people, had a discussion with one and yes they are worried about their political system and thus like to offshore some money and be ready to move, but are you serious? They like the US just as much and stuff is far cheaper there. I’ve been to Vancouver, Whistler, Houston, San Francisco, Portland, Seattle, Denver, Vail, Whitefish, Toronto, Montreal, Kelowna, Chase BC, Edmonton, and London and Holland. And of course Calgary and Banff. Haven’t seen it all, but I’ve seen enough to know this: Vancouver has nothing on the world. There is a reason why Seattle produced Microsoft and Boeing, and Vancouver produced the debt associated with the worst winter Olympics ever. It will be that way forward too.

The people of Vancouver are a bunch of forest cutters that have recently discovered some oil. Nothing else to see but a post card, and sinking ferries.

#17 Tim on 11.19.10 at 2:04 am

Hey,
maybe these saps in TO can score a tiny, overpriced condo with no greenspace at Olympic Village. Who in their right mind would buy into that development when it is in receivership? Who knows what they will decide to do to unload the units? You mention most of the buyers at the complex in TO were Asian. China has the second highest number of millionares? Even if one percent of the wealthiest Chinese move over here then were screwed…Thanks to our spineless Government who lacks the backbone to make it illegal to foreigners to own property, thereby disenfranchising many people who grew up here.

#18 Peter Pan on 11.19.10 at 2:13 am

Equally harmful attitudes toward real estate…

Americans used their houses as ATMs.

Asians use their condos as piggy banks.

Neither have happy endings…

#19 Mike Turner on 11.19.10 at 2:42 am

My sister just bought a new house. I told them to wait but it didn’t matter they both finished school and have jobs and want a house. They bought in Paradise a town just outside St. John’s where prices have jumped almost 20% since last year. If a car was 20% more today than a year ago people would be questioning what was going on but for some reason a house is completely different.

I was talking to a woman from Ireland in class the other day and she was talking about how bad it is there and how the real estate market has tanked. We’re walking a tightrope it’s only a matter of time before we slip. I guess we’ll soon see how good the safety net is.

#20 realpaul on 11.19.10 at 2:48 am

People tend to forget that the Chinese pay zero income tax on what they earn and pay zero property taxes. We can’t compete as we are tied down with 50% direct income tax and antoher 35% in indirect taxes ( fee’s etc). Its small wonder why the Chinese think real restate in Canada is cheap…because they have a far higher disposable income.

Than the Cons and the BOC for keeping the Canadian dollar under the dollar not matter how fast it may plunge. We were priced out of the market in many cycles because of our manipulative dollar policy and egrgious high taxes. Its the Chinese now,,,but a few years ago it was the yanks…the Brits..the Mexicans…..as long as the government is predisposed to keep Canadians the poorest country in the developed world we will see new landlords…speaking tongues we can’t understand.

#21 duesouth on 11.19.10 at 3:34 am

So if you ever had a doubt check out the “REDUCED” listings in blue ink in the most recent update from the FSBO site OKHomesellers here in the Okanagan.

Even the entrepreneur type owners are heeding the call and the running of the BULL may have caught up here in the Okanagan….then again maybe not.

As you say Garth, but it’s different here! — NOT!!

http://tinyurl.com/2cg7suu

#22 Outside the Box on 11.19.10 at 3:43 am

“So, a one-bedroom unit of 600 square feet sells for around $275,000 with a place for the car. The building’s in one of the slummier parts of the downtown core, where walking the dog after dark is always an adventure. Unless it’s a really big dog with a bad tude. Condo fees on this unit are $325 a month. Taxes about the same.”

Ok, and WHY do people BUY these condos (err, apartments)? Here is the REAL DEAL as I see it. Give your landlord $275,000 in rent upfront then PAY your landlord $650/mo to live in “your” apartment in a crumy area you wouldn’t “rent” in, but hey, you “own” it right so that’s ok? Give me a break.

Owning a condo is worse than renting an apartment. You can rent a big apartment in Toronto (2bd or 3bd) for $1000/mo, so why would you pay $650/mo + $275,000 upfront? Oh, and the condo “owner” has to pay to fix your own place. That’s Forrest Gumpish.

I had the opportunity to enjoy a “condo” for 26 years, well, an apartment, and it was rented in a 21 story building in Toronto.

#23 GTAInsider on 11.19.10 at 4:09 am

Garth, is this the hot pumping “The Berwixk” site that the Asians are brainwashed by the media, newspaper and free roasted pig banquet that I told you about 2 days ago ? As I said in many posts, Asians loves to worship condos, houses and nothing more (not stocks, preferred and mutuals)…Because they only believe that these are underground capital gains that he/she can get by flipping around to some newbies without paying income taxes…Imagine LOTS of Asians newbies making mid-range income a year and loading up over 10 units in the past year…where is the money coming from ?? Imagine Asian real estate investment clubs (same scheme they are doing in China) and using the same strategy to play with our T.O market by having 30, 40 or 50 guys and gals (mixed with real estate agents, brokers, lawyers, sellers, buyers) and load up 10’s or 100’s of condos and all they want is to make capital gains…All I can say is the market in TO has been distorted with Asians load up at insane prices and still believe there is still a higher run up…Needless to say, so called luxury Kylemore homes (saw over 20 cars at their model homes last sunday) at Major Mac & Warden is currently selling closed to 1 mil a pop…in Q1 2009, they are only selling for 650K – 700K…!!!

#24 Jay Currie on 11.19.10 at 5:57 am

Daed cat bounce.

#25 Carioca Canuck on 11.19.10 at 7:05 am

Garth:
Reference today’s picture: why are you wearing that speedo?
Please keep to young, stupid, blond realtor girls. It attracts our attention better…

#26 Leanne on 11.19.10 at 7:13 am

Wow – so that’s what Santa Claus does the rest of the year.

#27 T.O. Bubble Boy on 11.19.10 at 7:25 am

The ‘Hot Asian Money’ fallacy:

http://canadabubble.com/bubble-article-list/1312-the-hot-asian-money-fallacy.html

#28 timbo on 11.19.10 at 7:31 am

amazing that when a market cannot justify a selling price due to incomes in the area it must rely on an outside force , aka “Rich Chinese”.

Why the housing bulls never made much sense
http://blogs.reuters.com/felix-salmon/2010/08/17/why-the-housing-bulls-never-made-much-sense/

#29 T.O. Bubble Boy on 11.19.10 at 7:33 am

Here’s part of the problem… cheap money will keep flow from CMHC as long as the mortgage bonds seem less risky than bonds from other countries (like, say, anywhere in Europe).

http://www.bloomberg.com/news/2010-11-19/housing-trust-pays-lower-rates-on-foreign-demand-canada-credit.html

#30 T.O. Bubble Boy on 11.19.10 at 7:53 am

Somehow, Vancouver is having a “better” month(relatively speaking) for RE sales:

http://vancouvercondo.info/forum/topic/november-data

On target for a -17% drop… half of the -35% Vancouver has been seeing.

And, even 1 day with sales outnumbering new listings:
http://www.yattermatters.com/

Vancouver All Areas (Attached & Detached):
New Listings – 110
Sold Listings – 147

#31 Moneta on 11.19.10 at 8:04 am

We’re walking a tightrope it’s only a matter of time before we slip. I guess we’ll soon see how good the safety net is.

Good one! When I moved to Ontario I applied for benefits for my son for disability benefits.

I got a nice letter telling me he qualified but that unfortunately the bank account was empty and that we would have to wait until somebody decided to deposit some funds.

A look at Califronai will give us a god idea of who gets cut first. It always starts with the poor and disabled.

#32 Brian1 on 11.19.10 at 8:27 am

Devore; Yesterday: I am not preared to argue forever, but only for as long as you give me ammunition. Perhaps you don’t live in Ontario or do not rent nor know renters. You’ve stated that they should raise rents gradually. That is what they have done for 18 years at least. If it was the old economic textbook example of rent control I would still be paying $500 per month rather than approaching $1400 today. In my building they are trying to rent 3 bedroom apartments for $1500 and they are sitting empty. The rent monetary ceilings have been met. Rent control is almost dead. Old tenant apartment turnover is maximised and I don’t see how the tribunal could be busy. If I didn’t believe in Garth’s predictions I would have bought an overpriced condo which is what the government wants.

#33 Baba Gannoush on 11.19.10 at 8:27 am

Garth – fantastic job – each day I check out this blog before I even check any emails….

I read the globe yesterday – they made a “off reference” towards you – I will qoute them later but it gave the impression that if your in the Garth Turner camp (which they had to mention that you are selling books on the pending housing collaspe) that if your a “nut job” then maybe the sky is falling –

Since reading this blog – I completely dispise the media – what ever happened to unbiased reporting..oh yeah..advertising dollars dictate what is pushed to the masses. I know 3 people close to me that if the market does even a slight hiccup – there house of cards will come crashing down – and no matter how often I try to explain that something is gonna give – to be just cautious – and I get laughed at…oh well…no one can predict the future but one this is for sure – what goes up – must come down.

Anything more than proven 3x income to mtg is a ingredient for disaster..

#34 Paully on 11.19.10 at 8:34 am

Apparently, when things soften in the adult film industry, I am told that they often employ the service of a “Fluffer,” to perk things back up. So if our real estate market is indeed softening, I would like to nominate Jennifer to be the official “Real Estate Fluffer” for Canada! Yeah MissyBunny!

RE: #19 Mike Turner: I met a woman at my condo last week who recently moved here from Ireland. I asked her why she decided to emigrate, and her answer astounded me. She told me that there was just no work for her there at all. She said that nobody seems to have any money because they are all buried in their over-inflated house debts and cannot afford to spend on anything else. Local business are dying. Her direct quote that really blew me away was “if you did not buy a house in Ireland in the past three years, you would have had to be crazy. Or broke. Everyone was buying anything they could. The only reason that I was free to leave is that I did not have the money to get into a house…and I am so thankful that I did not, because I would be trapped there too!”

#35 bigrider on 11.19.10 at 8:36 am

Financial suicide mission on today. I’m doing it for the good of all here.

Going to run into Brad Lambs office..200k in hand.. for the purchase of 5 condos at 40k down a piece ..scattered strategically around the downtown core..

That should put the nail in the coffin for RE once and for all.

#36 bigrider on 11.19.10 at 8:41 am

I’m giving the order for snapcount. Order needs to be confirmed by secretary of state (my wife) under the two man rule. Order confirmed

Yes the release of savings in stocks and bonds has been authorized.

Target packages have been selected. Condos will be purchased throughout T.O and Vancouver.

“MAD” (mutually assured destruction) all but assured.

#37 bigrider on 11.19.10 at 8:46 am

I wish to martar myself.

My entire net worth will be liquidated in the coming days and I will spread it as thinly as possible with minimum downpayments on multiple properties throughout TO and Vancouver.

Brad Lamb here I come.

See you all in the soup lines.

If you all erect a statue in my honour, please look to my right side.

#38 S.B. on 11.19.10 at 8:51 am

Those peole who buy a new condo must realize: EVERYONE on the condo project makes a profit…except the buyer.

By the time you move in the project is completed and everyone has earned a profit: the trades, the crane company, the city inspectors, the night watchman, the Timmie’s around the corner. Everyone. Except you.
(No company or trade will bid on a job unless they can earn a profit on it).

So, buying a new condo is simply a transfer of wealth from you, into the economy. Enjoy! Then, you spend 25-35 years generating interest profits for the bank.

Say, avg. 5-6%/yr paid to bank in interest, given historical rates. Kind of like a preferred stock yield.

Why not save the hassle and simply buy the bank preferred stock and EARN the 5-6%? Wait…that’s what GT has said all along…

#39 Ben on 11.19.10 at 8:57 am

kkkkaaa…. Earth to TheBestPlaceOnEarth… please come in… kkkkaaa

#40 Renting in Milton on 11.19.10 at 9:00 am

The large house just up the street from us in Old Milton just sold. Listing price was 890,000! On the market for a few months. I’m not sure what the final sales price was but I know the Remax sign had two agents representing it. Just down the road is a sea of new developments littering the farmer’s fields.. Townhouses and detached with stupid price tags for starter homes. It’s getting really busy (traffic wise) in Milton and I can only predict that it will get worse and worse as time goes on. I hope one day we can buy a place of our own but for now, I just sit and watch the destruction of the beautiful land around us.

#41 Jimbo on 11.19.10 at 9:10 am

Garth Said.
“If you really need a house to save your spouse, there’s no choice. If your family’s about to disown your sorry renting ass, then dive in.”

So true and I did just that, reserve your judgment till you read the whole story.

I sold the McMansion in the burbs last spring, great harvest, and have been renting ever since. Wife is going nuts, dogs with no back yard 4 walks a day, and 20 something kids scattered about, no one is happy but me, let them all eat cake I say.

Even after attending Garths blurb at the double tree. (Great by the way.)

And knowing and agreeing with Garth that the market has the potential for a major wealth killing correction, why did I do it.

I had to do it, last week I was in the tub and wife was blow drying her hair, she give me this weird kind of look, and I realized the blow dryer could easily reach the tub. Something had to be done.

I bought a bungalow by the lake in west Toronto, high demand area, has a tenant, a professional renting ½ the basement for an outrageous monthly rent.
I am going to put the title all in my wife’s name, after all she wanted it. I have the funds to pay it off completely a few times over, but I am going to mortgage it to the nines. And let my capital keep brining me my nice 7 to 11 percent.

When and if [email protected] hits the fan, I have many options to get out, pay it off, or just walk and let the wife walk around with no credit cards for the next 7 years, that would not be a bad thing, believe me. Capital is still preserved. But then again there is this blow dryer problem.

#42 paying off Mortgage on 11.19.10 at 9:11 am

I am one of the lucky few who will be mortgage free today. So now according to Garth sell my house and take away the largest tax free capital gain of my life.
And he’s right, the problem, we are to emotionally atached to the dam house.

But like my wife said and it’s illogical but…. If our house drops 50% and the house we want to buy drops 50% whats the big deal.
hmmmm

My only comment on the post above, if people are not listing their houses but people still want to buy, does supply and demand still not work? I guess March will be the real truth when everyone wants to sell and no-one wants to buy. Should prove for an interesting spring.

So maybe I can sell in January and rent the house from the new buyer? win win only in Canada eh!

Still hard for me to imagine a significant housing drop like the USA.

#43 Devil's Advocate on 11.19.10 at 9:27 am

volumes this month to date trending 75% of that which they were for the same period last year and 120% of that for 2008 with prices for all three of these last years holding within 5.0% of one another.

Yes things are bad… very, very bad.

How many months in a row have I been reporting very similar results? Five? Six…?

Yes numbers (volumes) are down a “tad” WTF do you expect after coming off the highs we have been on?

Garth, we’re still waiting. How long can you keep saying “next month”?

Again brother I’m not saying you are wrong… you are just pumping your own story with an equal dose of exuberance as those on the dark side.

Get it people..? I am not saying we are going up still. I am not even saying we are staying stable… what I am saying is we are not facing something quite so bad, not nearly so bad, as many on these blogs would have you believe… including Garth.

Oh yes I know… wait ’till spring to see it… you can’t tell at this traditionally slow time of year. Got news for ya people buy and sell houses all year long. Those numbers at the top of this post… they are for the same period in each of the last three years (November 1 – 18).

Have at her pups and poodles… point out the flaws in my arguement. Or, heaven forbid, see some truth in those facts.

#44 HJ on 11.19.10 at 9:27 am

… Condo fees on this unit are $325 a month. Taxes about the same. …

$650 a month in condo fees and taxes! My rent on our semi is only $700 a month which includes 4 bedrooms and 1 & 1/2 baths.

Plus we can walk the streets after dark and I have a nice size garden in the back yard and a large patio for our bbq and flowers … great for entertaining, grilling and having a few drinks.

Keep your condo.
HJ

#45 jimmy on 11.19.10 at 9:29 am

Let Ireland go bankrupt. Ireland should have let the banks fail maybe guarantee depositors funds but the bondholdrs. I cannot see this ending well for Ireland and how it can possibly pay the money back.This and Keynsian economics is all about pay later and delay pain. Doesn’t work in the end.

#46 HJ on 11.19.10 at 9:32 am

I forgot to mention … driveway holds 3 cars and it’s ‘free’ parking!

Plus we can ‘walk’ (I know that is a hard concept for some people) to 1/2 dozen restaurants, a LCBO and a large marina and park all in 5 minutes!

Keep your condo!

#47 MikeT on 11.19.10 at 9:33 am

@ #6 Timingiseverything:
no, it’s not leage to kill squirrels (at least in Toronto). The fine is 2k per killed squirrel. Done the research myself, cause I had my reasons. Raccoons are 2k per head too. Beef is cheaper to munch on…

#48 BDG-YYC on 11.19.10 at 9:40 am

Bernanke in his keynote to the ECB calling for a new world monitary system, among other things.

Text:

Conclusion
As currently constituted, the international monetary system has a structural flaw: It lacks a mechanism, market based or otherwise, to induce needed adjustments by surplus countries, which can result in persistent imbalances. This problem is not new. For example, in the somewhat different context of the gold standard in the period prior to the Great Depression, the United States and France ran large current account surpluses, accompanied by large inflows of gold. However, in defiance of the so-called rules of the game of the international gold standard, neither country allowed the higher gold reserves to feed through to their domestic money supplies and price levels, with the result that the real exchange rate in each country remained persistently undervalued. These policies created deflationary pressures in deficit countries that were losing gold, which helped bring on the Great Depression.3 The gold standard was meant to ensure economic and financial stability, but failures of international coordination undermined these very goals. Although the parallels are certainly far from perfect, and I am certainly not predicting a new Depression, some of the lessons from that grim period are applicable today.4 In particular, for large, systemically important countries with persistent current account surpluses, the pursuit of export-led growth cannot ultimately succeed if the implications of that strategy for global growth and stability are not taken into account.

Thus, it would be desirable for the global community, over time, to devise an international monetary system that more consistently aligns the interests of individual countries with the interests of the global economy as a whole. In particular, such a system would provide more effective checks on the tendency for countries to run large and persistent external imbalances, whether surpluses or deficits. Changes to accomplish these goals will take considerable time, effort, and coordination to implement. In the meantime, without such a system in place, the countries of the world must recognize their collective responsibility for bringing about the rebalancing required to preserve global economic stability and prosperity. I hope that policymakers in all countries can work together cooperatively to achieve a stronger, more sustainable, and more balanced global economy.

Read more: http://www.financialpost.com/news/full+text+Bernanke+speech+with+charts/3854341/story.html#ixzz15ji8ndIe

#49 Taxpayer like everyone else on 11.19.10 at 10:03 am

16 Nonplused – Do you have something against forest cutters?

#50 GregW, Oakville on 11.19.10 at 10:04 am

Hi Garth, re: F on BNN this morning

Just saw F on BNN TV. He is doing per budget consultations now.
Maybe you do want to go to the talk Mon in Oakville to add/give him your input
of what you believe would actually be useful for all the people..

F want’s to carefully try and Shepard Canada though the fragile recovery.
(I am tempted to make a Shepard-sheep comment but it’s wouldn’t actually be useful.)
‘We the People of Canada’ actually need useful. I hope F is actually listening and has become a more critical thinker able to fined ’wise’ people to here (even Mr. Turner!). He/we might be pleasantly surprised were a useful ideas that is helpful to all can come from.

For what it is worth, corporations have there uses, but there are not human beings.
Corporation should not be given more rights that a human being, and all human beings should have rights to clean water, good food, clean air, and shelter which all helps towards keeping people healthy and happy. But I guess there isn’t much profit in that?
(The movie ‘the corporation’ will make some think.)

Money is only a tool made by a few humans to do stuff…
What do you let your tools be used for? Do we really have much choice?
F has a bit more choices right now than most I wonder what motivated his choices? Hopefully good.

#51 AxeHead on 11.19.10 at 10:19 am

I know someone who bought multiple condo’s in Florida for 35k each and is renting them out. He has about 6 of them. Anybody else doing this…and anybody know of the tax repercusions of this?

#52 brainsail on 11.19.10 at 10:28 am

“Most (and least) affordable cities to buy a home
These are the five most affordable major metro areas in the nation for homebuyers and five markets where home prices are least affordable.”

http://money.cnn.com/galleries/2010/real_estate/1011/gallery.housing_market_affordability/index.html

#53 MikeT on 11.19.10 at 10:37 am

@ # 45 Jimmy:
Ireland gave up. The debt claws are deep in its flesh and it has no escape… Another kingdom of forever-serfs. I so much hoped it will be the little pebble that overturns the debt cart. Sad…

#54 GregW, Oakville on 11.19.10 at 10:43 am

Hi Garth, fyi, Money seems to make the world go round, so just letting you know I found out last evening about three speakers on Nov 23, Tue evening 7:30pm at Oakville Town Hall, Oakville room.1225 Trafalgar Rd., Oakville, ON., L6J 5A6
I might even go to here other views that may not get covered on the 6 o’clock 2 min sound bits.

Halton-Peel Humanist Community presents forum on human rights & peace. http://www.h-phc.ca
Speakers:(Main Topics)
-Nasrin Besharat, member of the International Committee Against Stoning. (Stoning of Women)
-Khaled Mouammar, President of the Canadian Ara Federation. (Plight of Palestinians)
-PLUS an American war vet to speak on the horrors of the Afghan war. (War in Afghanistan)

#55 Devil's Advocate on 11.19.10 at 10:48 am

#38 S.B. on 11.19.10 at 8:51 amThose peole who buy a new condo must realize: EVERYONE on the condo project makes a profit…except the buyer.

That’s called commerce. Even non-profit housing is created through paying trades and suppliers a profit to build it. If you didn’t it wouldn’t be built. Actually the profits in non-profit housing are HUGE… it’s a sentimental obligation thing on the part of the providers who are sold the idea by the developer ;-) Don’t you think you should hire me to build this for you? Don’t you owe it to your community? Bleeding heart liberals are not particularly shrewd business people… easy targets.

Get it? … oh bother, probably not.

#56 jimmy on 11.19.10 at 10:54 am

See another Air Canada affair is brewing in the Conservative party. Corporate subsidy of what 300 million or more to Air Canada. Why? I thought the Consevatives didn’t believe in corporate welfare. Can’t Air Canada compete. This will not end well.

#57 GregW, Oakville on 11.19.10 at 11:05 am

Hi Garth, still flying? 15min video link

DA Now Sending Deputies to SF Airport to Investigate Felony Groping
http://www.infowars.com/da-now-sending-deputies-to-sf-airport-to-investigate-felony-groping/

#58 Joe Q. on 11.19.10 at 11:17 am

Garth wrote: “Remember that the bottom end of the resale market … has cooled off dramatically, while the higher end … is still recording modest sales. Thus, the average price gets goosed higher, even as the bird is plucked.”

This is why it’s important to look at the median sale price as well as the average price. Unfortunately median sale price info for Toronto is only available monthly and the info isn’t as fine-grained as the average sale price info that TREB provides.

The YOY increase in median sale price in the GTA in October was much less than seen for the corresponding average sale price.

#59 WINNIPEGER on 11.19.10 at 11:20 am

Same trend here in the Peg.

Mini bidding wars for lower priced homes while the higher priced ones sit idle.

#60 Coraline on 11.19.10 at 11:26 am

DA: But I’m sure your 2010 numbers are below 2007, 2006, and 2005, too. Maybe 2004 and 2003, too.

#61 GregW, Oakville on 11.19.10 at 11:38 am

Hi Garth, fyi, still want the shots with mercury and stuff? Must see 3 min video! the 2-3 min bits is chilling!
Who will choose, you??? Are your friends and family even paying attention?

Bill Gates: Register Every Birth by Cellphone To Ensure Vaccination, Control Population Growth

On the tails of a recent TED conference where Bill Gates stated that

vaccines need to be used to reduce world population

figures, he added more to this insanity last week with a keynote address at the mHealth Summit, an annual gathering whose supposedly focuses on improving health care through mobile technology.

Gates told an audience of more than 2,000 that if we could register every worldwide birth on a cell phone, we could ensure that children receive the proper vaccines. He also said the key to controlling population growth is to save the lives of children under 5; and the next big thing in technology is robots.
http://www.infowars.com/bill-gates-register-every-birth-by-cellphone-to-ensure-vaccination-control-population-growth/

Youtube, ‘in lies we trust’ I found informative also.
Why do they want to have more control of the internet, so you and your kids can’t find out I suppose. Staying uninformed is not in your best interest it seems, but your lack of information is for some important.

#62 Paolo on 11.19.10 at 11:43 am

Funny, as I reading this I had to run off to help some employees at my place of work. As I sat there working away I hear one person say that if they stayed in their original home, their mortgage would have been paid off right now. However their current mortgage amount is bigger than the purchase price of the original house. The other coworker says something about what can you do and then well it’s an investment and it (Real Estate) “always” go up.

There you go. And Asians?

Any new Canadians always worship real estate. Always have. Always will. They will forego vacations, luxuries, dinners out, fun, personal pleasures, drive beat up old camrys or civics, etc…to pay down that home whatever the price. I grew up around the same mentalities and I’m not Asian. The old will skimp and save to buy for the young and a pile of bricks or even a concrete box in the sky has a huge psychological weight associated with it. It’s something to show off to the community and it becomes a trap in the sense that everything, all energies are funneled into it and at all costs.

Don’t mention the BoC, stocks, the bond market, QE, ETFs, mutual funds, RRSPs, TFSAs, etc… there is no point. Talk only about real estate and how much money someone made on his or her home.

Hey, like I’ve heard on this blog before, “Pay someone else’s mortgage and see where that gets you?” And this is the basic mentality.

However I worry about the two camps Garth mentions above. Last year, as I worked with some South East Asians one individual was bragging about how a relative sold a Mississauga home in one day after multiple bidding wars. I thought, wow this reckless behavior is going to hurt all of us (like I said about the USA a few years ago) but trying to explain this to people that have roots in the GTA going back to maybe 2001 is fruitless. Pointless explaining 1992 or 1980-1, etc… In fact, they viewed the sale during a bidding war as a success. It was pointless to mention that said seller ended up buying another Mississauga property in a larger bidding war. Paid way too much. Bought in a frenzy, etc…

Yes, investment. Yes, always goes up. Yup, you are shrewd investor because greater fools lined up to buy your overpriced home (as you did in turn).

This will not end well and I feel bad for the many ‘New Canadians’ in and around the GTA (or any major city in Canada) because they are not immune from what’s coming. I feel sorry for them because developers in Brampton or Mississauga or Milton are not your ticket to the “Canadian Dream”. It will end badly if your roots go back 10 years in Canada, or they go back over 100!

“Yes Virgnia, legions of Asians or Iranians are not going to keep Yonge and Sheppard going on indefinitely. There are only so many $300,000.00, 600 square foot condos people are willing to buy and as the decade marches on, same people will wonder how they were so stupid. Will wonder why they can’t afford their monthly mortgage payment as interest rates reset to more historic levels”

Like I saw on this blog a few days back (made me laugh because I remember this mentality all too well):

“Buy a house like an Italian, buy at any price and rent out for $1300.00 a month”

Hilarious. Like watching a train wreck unfold…

Welcome to Canada, the Ireland of tomorrow…

#63 dark sad person on 11.19.10 at 11:47 am

How F saved Canada–

http://barchart.com/chart.php?sym=GM&style=technical&p=I&d=O&x=55&y=8&im=10&sd=&ed=&size=M&log=0&t=CANDLE&v=1&g=1&evnt=1&late=1&o1=&o2=&o3=&sh=100&indicators=&addindicator=&submitted=1&fpage=&txtDate=#jump

#64 45north on 11.19.10 at 11:47 am

Jimbo: I had to do it, last week I was in the tub and wife was blow drying her hair, she give me this weird kind of look, and I realized the blow dryer could easily reach the tub. Something had to be done.

pretty funny, also pretty smart how you have hedged your bets

If you’re in Ottawa look me up

#65 GregW, Oakville on 11.19.10 at 11:49 am

Hi Garth, fyi, article (What do he know? Sounds like he can think.)

New French defence minister says Afghanistan a trap
http://www.infowars.com/new-french-defence-minister-says-afghanistan-a-trap/

“Afghanistan is, I would say, a trap for all the parties involved there,” said Alain Juppe, a former prime minister who was appointed defence minister on Sunday in a reshuffle of conservative President Nicolas Sarkozy’s cabinet.

#66 Chris in Langley on 11.19.10 at 11:54 am

Devil’s Advocate,

You claim you’re happy to rise to the challenge. That’s good news. Whether the term is social intelligence or emotional intellegence, is not a big deal to me. The basic premise is about being self aware, which you claim to be, and I strongly disagree.

You’ve still not explained why my hypothesis is wrong. You claim that it’s wrong without giving any logical explanation. Here’s your opportunity.

Perhaps you could explain why I’m wrong in light of the fact that one of your entries today is diametricly opposed to your deeply held beliefs about real estate during the summer months? Remember…how it was going to rebound in the fall, and yet for several weeks you’ve been touting a position that agrees almost whole heartedly with Garth’s position?

#67 GregW, Oakville on 11.19.10 at 12:11 pm

Hi Garth, fyi, on FOX news 8min video. (Fallow the money.)

Geraldo Rivera who for so long has vocally opposed 911Truth has changed his mind.
http://www.infowars.com/geraldo-rivera-changes-mind-on-ae911truth-and-buildingwhat/

(I wonder why Rockefeller wants to shut down fox?)

Rockefeller Wants Government to Shut Down Fox and MSNBC
http://www.infowars.com/rockefeller-wants-government-to-shut-down-fox-and-msnbc/

#68 PTDBD on 11.19.10 at 12:15 pm

! in 5 Americans are mentally ill claims a government survey quoted on Drudge, WSJ, Newsday, etc.

That’s kind of scary if you believe the survey…shouldn’t they also be screening for this at the airports? Testing the pilots, central bankers, government reps, etc.?

OTOH, the natural reaction is to think that the survey is a crock of garbage, contrived for some nefarious purpose. If that’s the case, what does that say about other published statistics? You’d be crazy to believe them. Right?

…… 4 out of 5 people and 100% of financial announcers believe Bernanke’s deflation story, his actions and inflation figures. Hmmmm….

#69 BrianT on 11.19.10 at 12:34 pm

Mish covers Bernanke today-I don’t totally agree with Mish on this one (IMO Bernanke is a lot more crooked than stupid) but Mish is still very eloquent:

Preaching to the World

Bernanke is a man who could not find his ass with both hands and a roadmap when it comes to spotting the housing bubble, the recession, and levels of unemployment, yet he preaches to the world as if he has all the answers.

He is so hellbent on preventing deflation that he cannot see anything else. It would help if he even understood what it was. It sure would help if he could understand that rising prices without rising wages will crucify the average citizen.

But he is a blind, stubborn, academic wonk with no real world experience or common sense. I would love to debate him any day of the week.

#70 GregW, Oakville on 11.19.10 at 12:35 pm

Hi Garth, fyi I wonder if your on there list? and what the PM office is working on for us?

Congress Back To Censoring Internet
http://www.infowars.com/congress-back-to-censoring-internet/

#71 BrianT on 11.19.10 at 12:36 pm

#67Greg-To be fair to Geraldo, if he hadn’t opposed 9/11 Truth he wouldn’t be employed by the MSN. If you aren’t willing to lie you are not going to be employed.

#72 Devil's Advocate on 11.19.10 at 12:42 pm

#66 Chris in Langley on 11.19.10 at 11:54 am
Devil’s Advocate,
You claim you’re happy to rise to the challenge. That’s good news. Whether the term is social intelligence or emotional intellegence, is not a big deal to me. The basic premise is about being self aware, which you claim to be, and I strongly disagree.
You’ve still not explained why my hypothesis is wrong. You claim that it’s wrong without giving any logical explanation. Here’s your opportunity.

Perhaps you could explain why I’m wrong in light of the fact that one of your entries today is diametricly opposed to your deeply held beliefs about real estate during the summer months? Remember…how it was going to rebound in the fall, and yet for several weeks you’ve been touting a position that agrees almost whole heartedly with Garth’s position?

First provide me proof that I stated real estate “was going to rebound in the fall”. There is no chance what-so-ever that I said or wrote that. Not a chance. You must have misread something I wrote. Just no chance of that at all Chris. Real estate will not give any significant indication of a rebound for at least another two years. We are at best bumping along bottom right now.

As far as me explaining why your hypothesis that I lack social/emotionally intelligence/maturity is wrong… really now Chris, how the hell am I supposed to do that to your satisfaction without a personal assessment of me by you in the flesh and blood? Come on over to our place for dinner… meet the wife and kids. Trust me you are wrong I am very self aware, happy, content, my wants and needs are minimal and I have more than I need. Believe it or not I actually have a good cross selection of friends in my life ranging from highly successful free enterprise types to teachers, from government employees to people on E.I.

But back to the subject of real estate… personally I think we are nearer the bottom than most here believe. Not that allowed to freefall it wouldn’t go further but the governments are just not likely to let that happen. Not that I agree with them mind you… but they tend not to come to me for advice.

#73 Love This Blog on 11.19.10 at 12:42 pm

@47

“@ #6 Timingiseverything:
no, it’s not leage to kill squirrels (at least in Toronto). The fine is 2k per killed squirrel. Done the research myself, cause I had my reasons. Raccoons are 2k per head too. Beef is cheaper to munch on…”

Snares are quiet. If times get rough enough, the poilice will be too busy to fine you, they will be dealing with assaults, armed robbery, etc. Who in the hell will worry about a damned squirrel when the mobs are in the streets??LOL

I’m off work today, taking my son hunting later. I’ve had a good year! 3 deer, an antelope and a moose. Making/eating moose jerky right now. Friends and food bank did well too this year.

I could get another deer tag, but choose not to. And you can’t even kill a squirrel!!! Man, different places, are you sure we are even on the same continent, let alone country? Life is relaxed here, my commute is 1.6km, free parking at work, and all around Town.
No, not much night life………….but I really don’t need much. If the SHTF, c’mon out, with you blog dawg tattos for ID, and we’ll keep you fed.

LOL. Have a good days guys/gals. Got jerky to tend to.

#74 vreaa on 11.19.10 at 12:57 pm

The End Of The Implausible Happy-Ending Scenario –
“Real estate prices would rise 40 per cent quickly, condo prices would increase, and cost overruns would be covered.”

From an article in The Province [19 Nov 2010] on the implications of the developer for the Olympic Village going into receivership.
After laying out the likely money losing outcomes, the article ends with these flippant statements:
“There is a fourth scenario, however implausible, with a happy ending.
Real estate prices would rise 40 per cent quickly, condo prices would increase and cost overruns would be covered.
“Everyone would go away happy,” said [UBC real estate professor] Tsur Somerville.

(sarcasm/) Why is this so implausible? (/sarcasm)
Hasn’t our entire economy, for the last 10 years, been completely dependent on just such an implausible ongoing RE-price-rise bailout?
Where would we be without the 100%, 200%, 200+% RE price rises?
What will happen to Vancouver if/when RE prices don’t “rise x% quickly”.
We guess we’ll find out.
– vreaa

http://wp.me/pcq1o-1yb

#75 Timing is Everything on 11.19.10 at 1:06 pm

Canada urged to cut budgets, keep rates low

…and they will

http://news.xinhuanet.com/english2010/business/2010-11/19/c_13613217.htm
————————————————————
The OECD sees increases in taxes and user fees as a means of slashing debt at the provincial level.

…and they will

http://www.torontosun.com/money/2010/11/18/16199231.html

#76 jess on 11.19.10 at 1:07 pm

The “Bezzle”

http://vimeo.com/16572306
radio interview with janet tavakol

==========

Bagehot once observed every great crisis reveals the excessive speculation of many houses which no one before suspected.

#77 hobbitt on 11.19.10 at 1:21 pm

slight name change required here……

Ernst & Young has taken over the village, now called Millennium Underwater, on behalf of the city,

#78 Prof ANON on 11.19.10 at 1:28 pm

@ #68 PTDB

On a basic level, all research is agenda driven because the choices of which questions to research and of which level of analysis to focus on is driven by personal values.

In effect, it is the mental health researcher’s job to find illness. So it is not surprising that they would find lots of them.

Similarly, it is the sociologists job to find ways society constrains the individual (e.g., “it’s society’s fault), and it is the psychologists job to find ways the individual matters (e.g., “individuals, not society, make a difference”).

It is the policy maker’s job to draw on research from a wide variety of fields to make an informed decision. If your really curious about the survey that you cite, go to a library with access to full text academic articles via databases such as jstor. Pull the article, read the methods section, consider the authors theoretical and philosophical background (e.g., who they study under/publish with), then draw your own conclusion regarding the prevelance of mental illness.

#79 Nostradamus Le Mad Vlad on 11.19.10 at 1:30 pm


#34 Paully — Good post and a major reality check on what is really happening in the western world.

#37 bigrider — Too funny! Is it French Onion soup with melted cheese on top? I’m there! NOT!!

#38 S.B. — “Say, avg. 5-6%/yr paid to bank in interest, given historical rates. Kind of like a preferred stock yield. Why not save the hassle and simply buy the bank preferred stock and EARN the 5-6%? Wait…that’s what GT has said all along…”

Bingo! I would buy bank preferreds and bonds for as long as possible — 20 years? — and receive a continual, quarterly payouts not caring whether they went up or down in value.

That’s why I would have liked to have sold a year or two ago, rented a townhome and utilized the net proceeds, but it is not to be.

#41 Jimbo — Smart, very smart. Of course, the funds could be used for a RRSP-mortgage, but then again, better off getting a nice return and avoiding the wife.

#48 BDG-YYC — Good post. Other than all the yelling and screaming between countries, something will change soon.

The only part is we’re all caught up in day-to-day life, and thus most don’t even realize what’s going on.

#50 GregW, Oakville — “Money is only a tool made by a few humans to do stuff…”

So true. Money is no different than a rake, vacuum cleaner or shovel. All anyone needs is just enough, no more.

#62 Paolo — “Welcome to Canada, the Ireland of tomorrow…”

Great line. Look at Ireland, read poster #34 Paully’s comments and figure we’re headed in the same direction.
*
5:43 clip Three acres = One million pounds of food. Grown in greenhouses. A lot more efficient than the WH or 24 Sussex Drive.

F22 Raptor and CF-18 “. . . an American F22 loaded with a B83 Nuclear Weapon was brought down over Alaska.” China is involved. “Do not underestimate how dangerous of a time this is. Get your money out of the banks into gold or silver. Get stocked up on everything. Get out of the West Coast Cities.” SAF major fault soon? It’s winter . . .

Soros calling for change? He may be done with Obama and pushing for Hillary. Oh no!

Dec. 7 Reminder French citizens are having their own Bank Holiday! Link in.

The countries mentioned are all liars, as witnessed by America’s destruction of Iraq and ObL, who moved back into the other worlds in Dec. 2001, when he died of kidney failure. Iran has no nukes and is a signer of the NNPT.

Lotsa links in Spend the holiday season not getting mad, just getting even!

Obama a real juggling act (destroyer).

#80 Vancouver_Bear on 11.19.10 at 1:58 pm

#10 TheBestPlaceOnEarth on 11.18.10 at 11:33 pm

This is new, now the reason why Owe’lympix village failed were bed bugs. Ha-ha……give you head an MRI SCAN…..you have a huge bed bug living in your brain.

#81 Timing is Everything on 11.19.10 at 2:15 pm

#44 HJ

Where do you rent? Weyburn?

#82 PaulB in Ontario on 11.19.10 at 2:17 pm

“….which led bank-employed economists and condo-dwelling editors to lay down palm leaves and order a donkey….”

Quite possibly the best original writing I have seen this decade. Thanks for this.

#83 Vancouver_Bear on 11.19.10 at 2:30 pm

#10 TheBestPlaceOnEarth on 11.18.10 at 11:33 pm

Also it looks like that HUGE bed bug just finished consuming the remians of your brain…..yikes.

#84 OttawaMike on 11.19.10 at 2:36 pm

I no longer have squirrels in my attic.

3 of the critters have been living in my back soffit since Oct. I installed a vinyl sofit temporary cover over the entrance hole which they gnawed their way out of. (I wrongly had assumed there was only one resident and he was out)
I then used a long drill bit to drill the old wooden sofit and chase them towards the hole. They sat at the hole with their blacks noses pointing,watching me drill like mad.
I then hid around the corner and let them escape. Sealed up the entrance and victory!

#85 OttawaMike on 11.19.10 at 2:40 pm

#68 PTDB
On a similar note, I have no way to prove or disprove but believe the study’s conclusion 20% of the US population have squirrels in their attics.

The figures for common depression alone sometime in life in the general population is close to that 20%.

#86 Pat on 11.19.10 at 2:47 pm

Prof. Anon: “If your really curious about the survey that you cite, go to a library with access to full text academic articles …
Pull the article, read the methods section…”

I’ve done this with a few papers of Prof’s in the social “sciences” who have gotten on my nerves (e.g. by sticking “PhD” or “Prof” to their names whenever possible; whoever thinks that a PhD, especially in a subject that requires no particular talent apart from the ability to BS, is a great achievement worth bragging about, must be a pretty mediocre scientist/researcher).

Anyway, in all cases I’ve found the research to be laughably amateurish, biased or trivial.

#87 Martin on 11.19.10 at 2:54 pm

So The Star just posted this;
http://www.moneyville.ca/blog/post/893796–why-we-won-t-see-a-housing-collapse

What a load ….

We now live (so it seems) when anyone with a keyboard can be a ‘journalist’..With a Blog, Coloum, etc. Opinions based on nothing other then a casual thought get posted as news. Any idea of journalistic integrity, ethics, or fact finding, has left the building.

#88 BrianT on 11.19.10 at 3:08 pm

I have to laugh at these “goldbug” or “silver bubble” comments. Only a few months ago Ireland hepled to bail out Greece (Ireland is flat broke). Portugal and Spain to follow-now Roubini points out that eventually France will need a “bailout”. The USA is flat broke. So Germany and China will bailout the planet-sounds reasonable http://finance.yahoo.com/news/Roubini-Maps-Out-Nightmare-cnbc-2735623765.html?x=0&sec=topStories&pos=1&asset=&ccode=

#89 Chris in Langley on 11.19.10 at 3:21 pm

Devil’s Advocate,

Can you read? Scroll back and check out your posts from the summer, pretty consistent message about how things were going to get back on track, how you were going to be busy come the fall. Certainly I’m not the only one who read what you had to say back then.
Make sure to read the ones in late August forward until you had your public meltdown on the labour day weekend. (If you’re as self aware as you claim, bring some tums, you’ll need them)

I posted #121 yesterday. It’s not rocket science to take what I wrote and break it down. You said you went to UBC, surely you had to submit articles and defend your position on different matters?

Here is the post below. Break it down and give me your reasons why this hypothesis is wrong.

How to become a Devil’s Advocate

Some might call it a freudian slip – the comment about “a woman’s womb being the biggest polluter of all.”

freudian slip- n. A verbal mistake that is thought to reveal a repressed belief, thought, or emotion.

So if you want to be a devil’s advocate like the man himself, all you need to do is repress deeply held anger and resentment. Put on a happy face. Think super positive. Lie to yourself about your feelings and then make a jackass of yourself in public forums. It also helps if you ignore the feedback people give and try to cover up your lack of emotional intelligence. This is done by striving to assert your intellectual abilities – it’s called over compensating for other areas of weakness. In males it’s called the “small dick, big mouth” syndrome.

Emotional intelligence (EI) describes the ability, capacity or skill to identify, assess, and control the emotions of one’s self.

How’s the wife?

P.S. – One doesn’t need to sit and have dinner and meet a person’s friends to get a sense of their character. Playing golf is one of the most instructive ways to get to know the character of a person, as is reading hundreds of their blog entries over the course of many months. The key is to engage them in activities that they feel strongly about and see what comes up.

#90 Kelowna is ground zero on 11.19.10 at 3:36 pm

Devil’s Advocate

“But back to the subject of real estate… personally I think we are nearer the bottom than most here believe. Not that allowed to freefall it wouldn’t go further but the governments are just not likely to let that happen. Not that I agree with them mind you… but they tend not to come to me for advice.”

What exactly do you think the Gov’t can do? They cannot control prices, they can only control interest rates and they have slashed them to zero. Look at the US and what the Gov’t “allowed” to happen there. You are giving people like F a lot more credit than they deserve.

Please show us the month over month prices in Kelowna for condos and detached for the last 36 months. Thanks

#91 Hell in a Hand Basket on 11.19.10 at 3:54 pm

End JP Morgan, buy an ounce of silver today!

#92 Business Unusual - the BUN on 11.19.10 at 3:56 pm

The rich continue to bid up high-end home prices here in Vancouver that may be way their is a new kind of lender emerging.

High-End Pawn Shops for the Rich & Famous
http://www.businessunusual.net/odd/highendpawnshops/

#93 Carioca Canuck on 11.19.10 at 4:01 pm

Just sold my second house yesterday!
This market is getting tougher to sell but… it’s such a great time to acquire a home that there’s no arguments with buyers.
I love being a realtor!

#94 Paolo on 11.19.10 at 4:14 pm

#87 Martin – Yes, what a load!

Hilarious

Why we won’t see a housing collapse

The Reasons:

Different regulations (I say but problems in same spirit as in US, same features of hooking people into massive debt)

Supply and demand (Again with the poor immigrants – they are going to get fleeced! – see my post above #62)

We can afford our homes (Nuff said)

People pay their mortgage first (Generally only if you are a recent immigrant – see my post above #62)

Interest rate impact (Basically the increase will spell the end)

My sister lives in the USA and bought a home in 2006. She is underwater right now.

To the above, because we’ve had this discussion before, she says:

“That is what they were telling us here, how stupid are Canadians up there?”

Very stupid – – just talk to anyone from Ireland.

“What can you do? It’s an investment and it always goes up” (-see my post above #62)

#95 Prof ANON on 11.19.10 at 4:15 pm

@ #86 Pat

I’m assuming your a nobel prize winner or at least an editor in chief of a physics journal?

All I did was make the point that all research is biased and therefore needs to be considered within context, and you go off on some kind of holier than thou critical rant. Relax much?

#96 Increasing that 1% on 11.19.10 at 4:27 pm

#41. Jimbo

Parts of your post brought to mind your wife could have found therapeutic comfort in Cake’s song, (..’i-iyiyiii-want to flyy a-wayyy’..)-while at the same time you may relate to some of the images in the video
http://www.youtube.com/watch?v=mi9MLL8QOY0

#97 CTO on 11.19.10 at 4:30 pm

#87 Martin

I was at Macdonalds this morn and they have loads of Tor Star papers for customers to read. I guess they can giv-im away.
Anyway, I was reading the business section and I noticed the huge section with housing ads…
Hmmm…who pays their paychecks!!!
You will never get balanced housing news from a paper that desperately depends on the real estate cartel for revenue!!! Ever!!!

#98 Sail1 on 11.19.10 at 5:13 pm

#40 Renting in Milton

I just sit and watch the destruction of the beautiful land around us.

Head north, lots of land and beautiful scenery. Where are all the new immigrants going to live?

#99 Sail1 on 11.19.10 at 5:21 pm

#42 paying off Mortgage

I guess March will be the real truth when everyone wants to sell and no-one wants to buy.

March will come and go, and people will still be buying and selling homes. Unless interest rates climb considerably higher, there will be no change in sentiment. People will still want real estate as a home and investment, as always.

#100 Dorf on 11.19.10 at 6:05 pm

You know….over the course of any year it might be noteworthy to find one acquaintance of mine stating that he/she/they is/are having financial troubles. It happens to all of us at some point in our life.

Well… EI extended benefits for the unemployed and the Feds rolled out economic stimulus plans to hold back the water, and now both of those levies are gone. They were temporary infusions of capital that have now dried up.

Then…over the last 4 – 6 weeks, I have spoken to 4 different parties who say they are in financial trouble, one of those said “deep trouble”, and an additional one said they were almost in trouble. That’s 5…and in only 45 days.

What just happened recently to trigger this ?
Surely it’s not coincidence ?
Surely there’s got to be more people also affected then ? Wtf ?

I noticed…there are still 2 or 3 local developments that are still stalled out, after a few years of no activity, where some units were sold. There is another development that was a big buzz in the news and advertising, then they never broke ground on it. Nobody even remembers it now.

I see….recently it seems that every time a house sells for any price in any location, every realtor in the country writes statistics around the sale, publishes the good news numbers and breaks open the bubbly and the open house signs.

And I think….hmmmm.

#101 Timing is Everything on 11.19.10 at 6:27 pm

#47 MikeT
#73 Love This Blog

That is why ya gott live ‘just outside’ their tax/regulation/fee area(s) i.e. outside city limits!

Squirrel Seasons for Residents and Non-Residents (Ont.)

Open Season
Sept. 15 to Dec. 15
Sept. 20 to Dec. 15
Sept. 25 to Dec. 15
Oct. 27 to Nov. 7
Daily Limit 10
Possession Limit 10

Small Game Regulations (Squirrels, page 73)
http://www.mnr.gov.on.ca/stdprodconsume/groups/lr/@mnr/@fw/documents/document/239852.pdf

#102 Timing is Everything on 11.19.10 at 6:32 pm

#101 Timing is Everything

The dates refer to various areas in Ontario (Basically Sept. to Dec. is open season on squirrel)…
It’s all in the ‘regulations’… ;)

#103 Vancouver_Bear on 11.19.10 at 6:44 pm

#99 Sail1 on 11.19.10 at 5:21 pm

Tell it our buddies South of the border.

#104 Vancouver_Bear on 11.19.10 at 6:48 pm

#99 Sail1 on 11.19.10 at 5:21 pm

Or even better….go to Vegas and tell what you said here to locals….let’s see if you get home alive……They have guns there.

#105 View on 11.19.10 at 6:48 pm

“Please show us the month over month prices in Kelowna for condos and detached for the last 36 months. Thanks”

Central Okanagan is the Kelowna area…

http://www.omreb.com/page.php?sectionID=2

#106 Steven Rowlandson on 11.19.10 at 6:54 pm

Garth any one that shuns buying an overpriced property that he can not afford inorder to remain solvent is not a loser. He is wise.
Never ever try to buy what you can not afford and always conserve capital just incase of hardship or oppertunity to buy something that is underpriced or usefull. By that yardstick gold and silver bugs are wise.

Steven

#107 Devil's Advocate on 11.19.10 at 7:09 pm

#89 Chris in Langley on 11.19.10 at 3:21 pm
Devil’s Advocate,
Can you read? Scroll back and check out your posts from the summer, pretty consistent message about how things were going to get back on track, how you were going to be busy come the fall.

Ah yes what I wrote and how you interpreted it are two entirely different things.

What I wrote was that we were going to get back on track in that the housing market was returning to a more normal state. Certainly Chris you would not say that the last four years was a “normal” market.

What I meant by “becoming busy come fall” was that I personally was going to return to the business in a more ramped up fashion. The fact is I did not participate as much in the market of the last four years as I could have. It was a bit of a turkey shoot but really that’s not my style. It was a crazy market in which it was difficult to do the right thing for my buying clients. All logic was out the window. Yes I was a full time REALTOR and yes I earned a living but this market that is returning is my market. This is a very special time Chris… the shift in the real estate markets present some very rare opportunities for REALTORS like me who have been in the business a while. There will be many leaving the business and there will be many who don’t know how to do the business. It is no longer a matter of sticking a house on MLS a sign in the lawn and waiting for offers to roll in. This is a market that takes some know how, experience and a good work ethic.
Get it?

#108 Devil's Advocate on 11.19.10 at 7:11 pm

#89 Chris in Langley

I’m wasn’t a lit major Chris… sorry if you misunderstood my written word… but that does seem to be a prevalent problem here doesn’t it. Where is that damned sarcasm font anyway?

#109 BrianT on 11.19.10 at 7:15 pm

It is a good thing we won WW2-I hate to think what the airport experience would be like if the Nazis had been victorious http://www.wbtv.com/Global/story.asp?S=13534628

#110 Devil's Advocate on 11.19.10 at 7:16 pm

#90 Kelowna is ground zero on 11.19.10 at 3:36 pm
Devil’s Advocate
What exactly do you think the Gov’t can do? They cannot control prices, they can only control interest rates and they have slashed them to zero. Look at the US and what the Gov’t “allowed” to happen there. You are giving people like F a lot more credit than they deserve.
Please show us the month over month prices in Kelowna for condos and detached for the last 36 months. Thanks

1. Why do you think the economy hasn’t seriously tanked yet in the first place?

2. Are you wanting averages or means, list or sale, Kelowna wide or your specific neighbourhood? It does make a big difference you know

#111 Bill Grable on 11.19.10 at 7:26 pm

QUOTE: from Carioca Canuck: Just sold my second house yesterday!
This market is getting tougher to sell but… it’s such a great time to acquire a home that there’s no arguments with buyers.
I love being a realtor!

>> I can’t speak Portuguese, so let me use my other closest language, Spanish for you – Bueno suarte, cabron.
Adios.

#112 ballingsford on 11.19.10 at 7:28 pm

GM’s IPO released, stock markets react favorable. UK offers to rescue Ireland’s debt,stock markets react favorable . Flaherty working on Ireland’s debt woes (is Flaherty Irish?)stock markets react favorable.

What the hell is going on??? We need to stop using the g’damn markets as indicators of recovery! The world is so messed up!!!

#113 Timing is Everything on 11.19.10 at 7:39 pm

…That made him a target for agents who had long relied on commissions and now feared for their livelihoods.
He was new to the industry. He’d sold only three houses under the old regime, and was almost embarrassed accepting the commission, feeling he hadn’t earned it.

http://ca.finance.yahoo.com/personal-finance/article/canadianbusiness/1905/travel-agents-and-stockbrokers-are-nearly-obsolete-thanks-to-the-internet—are-real-estate-agents-next

#114 Nostradamus Le Mad Vlad on 11.19.10 at 8:00 pm


“The Federal Reserve is not a government institution. It’s a group of privately-owned banks to whom Congress illegally gave away the right to print the nation’s money. Now they print it, loan it to us, and we pay it back with interest.” wrh.com from The Daily Bail.

Dictatorship This is a great place to live, ain’t it?! Also — Dictatorship Two.

3:41 clip “I know this is chump change compared to the 2.3 trillion that was unaccounted for in 2001 (conveniently the CFOs were killed in the flight 77 crash the next day and SECC blown up in NY) but what makes this more of a sting is that 95% was earmarked for Iraqi reconstruction which wouldn’t be necessary had the pentagon not blown them up, and the money is gone. We pay to kill but not to help.” wrh.com.

IRA Blowing up banxsters. Also — 2:24 clip Let Ireland go bankrupt? They are way ahead!

New Housing starts not doing so well in the US.

Defending the US Fed. Strange.

Another reason for depopulation, Retirees, step right up for your free death (flu) shot!

Silver Bar Shortages “J.P. Morgan Chase is trying to cover their massive short positions, some of which are “naked” shorts inherited from Bear Sterns. But the music has stopped and players are scrambling for the chairs, wondering who gets left standing out in the cold.” wrh.com. JPM also has US$90 trillion in derivatives which they (or taxpayers) are left holding the bag for.

Not RE porn Stock market porn instead. Better, way more colorful. US – Japan stock markets almost identical.

4:12 clip “Georgetown Professor Tells Congress: “Citigroup, Bank Of America, JPMorgan & Wells Fargo Are All INSOLVENT”

Soros shorted the pound in the ’90s, and made nearly a billion in profit. Now the world has shorted the US$.

‘Net Censorship “Who says Congress never gets anything done?” To be expected, that’s fer sure.

Cracking the Fed “I have never seen a Federal Reserve credit or debit card. Whose numbers are those and why does the Fed have them?” wrh.com.

Iran “Looking at the bubbling animosity directed against Iran from the US and Israel, who can blame the Iranian military for developing weapons like this? But having said that, it is important to remember that the Iranian leadership may be many things, but they are not fools.” wrh.com.

Monsanto + the NWO.

Chocolate “Side note, chocolate doesn’t make you fat, the sugar added to chocolate does.”

3:07 clip Apparently the WH is not going to pay China back.

Rockefellers “Editors Note: It appears as if Fox News has really been exposing the global elite. The other possibility is that this is a psi op used to push Fox News as a truth media outlet.”

5:27 clip Back To The Future IV. In 2005, Robert Rubin predicted the IMF would bail out the US. Seems he may have been on to something.

#115 Moneta on 11.19.10 at 8:09 pm

We got our publi-sac yesterday or whatever you call it here in Ottawa.

Anyway, it’s more than 4 inches now. Same size as in Montreal. In 2001 it was maybe an inch.

I’m convinced the size of that thing is correlated to the well being of the NHL.

When that thing gets back to 1 inch, there are going to be a lot of people out of work… because advertising budgets will get slashed.

#116 Sail1 on 11.19.10 at 8:17 pm

#103 Vancouver_Bear

I know, we have a few casinos in Ontario, but I can’t believe your actually comparing Vegas to Ontario. Get a grip.

#117 Pat on 11.19.10 at 8:28 pm

#95 Prof ANON wrote:

“All I did was make the point that all research is biased and therefore needs to be considered within context, and you go off on some kind of holier than thou critical rant. Relax much?”

You made a point – the one I quoted before, not the one above, with which I agreed and then further elaborated on. That’s all.

As to all research being biased, your definition of bias is apparently so broad that it renders your statement trivial.

#118 KELOWNA IS GROUND ZERO on 11.19.10 at 8:31 pm

“DA: Are you wanting averages or means, list or sale, Kelowna wide or your specific neighbourhood? It does make a big difference you know”

Simply Kelowna general The average selling price. Can you make it simple like this:

Jan 2008 House +1.1%
Jan 2008 Condo +1.2%
Feb 2008 House -1.5%
Feb 2008 Condo -1.5%

With at the end of each year showing the chg in Value for the CALENDER year.

I woud be very interested in seeing the month over month move is text form for the last three years if its not too much work to post it.

#119 Ret on 11.19.10 at 9:09 pm

#11 Robert -Right on!

Permanent Resident is the new Politbureau speak for Landed Immigrant.

Similar policies enable universities to load up on foreign students with loans also backed by Canadian taxpayers.

The universities continue to float the self-serving rumor that all foreign students are paying 2x what Canadian students pay. Yeah, right. All five of them?

Kind of like the RE rumor that foreign investors had to bring in tons of cash to qualify to get to live in Canada. More MSM lies.

The students and investors are only bucks up because the Canadian banks have found a sure fire way to make billions without any risk. They make ‘softdoc(ument)” loans, fully guaranteed by Canadian taxpayers.

The banks have ZERO skin in the game. It will be the Canadian taxpayer’s a$$ on the line with the RE and student loan mess. A good portion of which, in my warped view of the world, will be caused by “Permanent Residents.”

#120 prairie gal on 11.19.10 at 9:26 pm

#55 Devil’s Advocate wrote:
#38 S.B. on 11.19.10 at 8:51 amThose peole who buy a new condo must realize: EVERYONE on the condo project makes a profit…except the buyer.

That’s called commerce. Even non-profit housing is created through paying trades and suppliers a profit to build it. If you didn’t it wouldn’t be built. Actually the profits in non-profit housing are HUGE… it’s a sentimental obligation thing on the part of the providers who are sold the idea by the developer Don’t you think you should hire me to build this for you? Don’t you owe it to your community? Bleeding heart liberals are not particularly shrewd business people… easy targets.

Get it? … oh bother, probably not.
_______
I see the same thing with self-loathing public servants who worship the private sector but have never worked there. Most likely right-wing economics and political science majors. Their fawning and naivety are embarrassing to observe. Plus they spend countless taxpayer dollars on consultants, thus ‘stimulating’ the economy with wheel spinning and massaging messages and looking busy doing nothing.

#121 S.B. on 11.19.10 at 10:13 pm

#34 Paully – great idea. Every condo sales office should employ a “Fluffer”: when the rube is hesitant with his commitment, the Fluffer will escort him into a VIP room and proceed to vigorously massage…his wallet! :o :D

#122 tkid on 11.19.10 at 10:46 pm

Ottawalmike, you are such a girl. My mother has evicted 5 squirrels from her attic without half the fuss.

#123 Vancouver_bear on 11.20.10 at 1:10 am

#116 Sail1 on 11.19.10 at 8:17 pm

I am not comparing anything….go to Vegas and tell locals that RE is the best investment…..don’t forget to take a bullet proof vest with you.