Nothing to be proud of

What a crazy old world this is. In Ottawa, F is rewriting his budget. The promise made in the election (six months ago) to balance the budget in 2015 is now history. In Toronto, the Ontario government warns of ‘extremely tough decisions’ as it faces a deficit which grows hourly. In France, the toughest austerity package since Paris was a smoking post-war hulk was just delivered.

In Washington the transformational president sits at 44% approval rating, staring at defeat even as a bunch of clowns campaign to oppose him. If Republicans win, spending stops, winter begins. Across Canada, 71,700 people lost their full-time jobs in just one month. In the US, our big trading buddy, 15% of the population now lives below the poverty line. A third of 14 million unemployed people have been jobless for at least a year.

How could it be more obvious what lies ahead? Glacial growth, less government spending and falling exports. Governments and families tapped out as never before. Europe and America in no mood to buy our stuff. This will mean more lost jobs and stagnant household incomes. Unless the laws of economics no longer apply.

Which brings us to Re/Max.

Spitting in the face of reality, these extraordinary house-humpers manufactured a news story this week that virtually every media outlet in Canada fell for. Here’s what I mean:

Victoria Times Colonist: The average value of Canadian homes has doubled in the past decade and Greater Victoria’s rate of increase is among the highest in the country. In the capital region, the average price, for all types of housing, was $504,561 in 2010, an increase of 123 per cent from $225,731 in 2000, said the Re/Max Housing Evolution Report released Monday.

Edmonton Journal: A red-hot economy fuelled unprecedented price appreciation in Edmonton over the last decade, making the city Canada’s second-strongest-performing market — up 165 per cent since 2000, says a report released Monday by Re/Max.

Winnipeg Free Press: Investment in new and existing homes is at an all-time high, driving up property values and selling prices in Winnipeg at one of the fastest paces in the country, according to a new study by RE/MAX. The real estate firm said today the average selling price of a Winnipeg home soared by 158 per cent between 2000 and 2010, climbing to $228,706 from $88,553. RE/MAX said Manitoba’s capital also could just be looking at even bigger price gains in the coming years.

Vancouver Province: The calibre of Metro Vancouver’s existing housing stock is a big reason average home prices soared 128 per cent from 2000 to 2010, from $296,000 to $676,000, according to a Re/Max report released Monday. “Average price in Greater Vancouver currently hovers at $791,332 — up 18 per cent year-to-date — and is expected to continue its ascent in the months ahead.”

Calgary Herald: Strong in-migration, population growth and a vibrant oil and gas sector have pushed Calgary average house prices to an increase of 126 per cent in the past decade, says a new report released Monday by Re/Max. “A few reasons I believe Calgary has seen such growth in the last 10 years is simple due to our strong economy from natural resources which has been a driving force in migration into Calgary for jobs,” says Tanya Eklund, a realtor with Re/Max Real Estate Central.

What’s the news? Real estate prices have increased since 2000. Therefore, of course, they will continue to increase!

It’s this logic which drove me to publish a book called ‘Greater Fool’ in early 2008, then start this pathetic blog. During this period of irrational increases in housing prices – due almost entirely to an ocean of cheap money and easy debt – family incomes have stagnated while borrowing’s gone ballistic. Traditional 20% downpayments have shrunk to an average of just 7%. Nine in ten new mortgages are now taken for the maximum 30-year amortization. The vast majority are high-ratio, high-risk, requiring federal CMHC insurance to protect the lenders.

No-money-down loans have proliferated. The major banks give money away for down payments along with mortgages. Governments during this time have popped new incentives, offering first-timers tax credits and allowing bigger raids on RRSPs to buy a home. Speculators, amateur investors and flippers have invaded the marketplace, providing 80% of the buyers for big-city condos. And below-prime VRMs lubricated by greasy lenders have allowed property virgins to start bidding wars with money they know will never be repaid.

The result: Well, just as Re/Max said. House prices have doubled. Now the average family can’t afford the average home in the average city. And here are all those big-city newspapers celebrating the fact, as if this were an accomplishment. Bragging, in a real estate macho contest.

Sadly, this is nothing to be proud of. Cities become expensive, then unlivable. Tensions rise and dreams die when children realize they will never afford their family home, even when they earn multiples of their parents’ income. We look to cast blame. Foreigners are an easy target.

But don’t stop there. Greedy sellers, irresponsible agents, horny buyers – the victims of human greed and desire – blame them, too. Toss in politicians who tried to democratize home ownership, but ended up turning it into gold. Avaricious lenders and myopic central bankers are key the story, making a joke of work and savings when money’s no longer needed to buy granite and stainless. And it’s all broadcast as good news by a media which lost its way when valueless corporations slipped into the editor’s chair.

Bravo, Re/Max. You scored.

176 comments ↓

#1 T.O. Bubble Boy on 11.07.11 at 10:58 pm

Here’s a tip: don’t be under 35 in the U.S.

http://rt.com/usa/news/wealth-young-age-theyre-735/

– the average American household headed by a man or woman age 65 or older has a net worth 47 times that of a household headed by someone under the age of 35

– 37 percent of the households headed by someone under the age of 35 have a net worth of zero or less

So much for “good debt” and “bad debt”… if you’re under 35, you just have debt.

#2 Leslie on 11.07.11 at 11:00 pm

Now I am first. And a woman, to boot.

#3 nmh on 11.07.11 at 11:02 pm

FIRSTT!!!!

#4 Mark on 11.07.11 at 11:03 pm

So if housing is so overvalued…by definition, something is undervalued.

What might that ‘something’ be?

If a smart person knew what that ‘something’ is, why not get out infront of the next asset to rise, rather than messing around with this bubble?

#5 A Fan in Van on 11.07.11 at 11:04 pm

Beautiful. When can I vote for you?

#6 Raj on 11.07.11 at 11:09 pm

Firstttttt

#7 nonplused on 11.07.11 at 11:15 pm

Nice work tonight Garth!

I still can’t figure out how it slipped into the collective mind that high house prices are a good thing. Whenever the cost of living goes up, that’s bad. I guess it must be because collectively many of us saw our house price go up much faster than we could otherwise save money, so we thought we were richer. But as I like to say, you can’t sell your house and live in it too. So there was no real net wealth generated, save the new houses that were built that wouldn’t have been otherwise. It just became more expensive to live, that’s all.

As Garth has so eloquently pointed out even with the title of this blog, when asset prices rise with no underlying increase in earning power, the only way to crystallize the notional wealth gain is to sell to a greater fool. Sooner or later that greater fool is you.

To belabour the point, that is why one might invest in Apple, but you don’t invest in iPods. By inventing the iPod, Apple changed the world and produced a great new revenue stream in doing so. That revenue stream is worth more money. But the iPod itself is a depreciating asset and gets cheaper for what you get every year. Heck, now it’s not just an iPod but also a phone, personal computer, internet access point, camera, video camera, video editor, gaming device, book reader, tv and pvr all wrapped up in one and it still only costs $400. But Apple is making a fortune. On the other hand, if Apple repriced the iPhone at $800, who would think that was a good thing??

With real estate, the investment potential is all in the rent. If the property goes up in price, that is probably just inflation. You are better off buying home builders or REITs if you want income.

But with the tax free treatment and free money mortgages, a bubble was bound to arise. Now that houses have become far too expensive to live in in much of Canada, prices can probably only go one way from here.

#8 Bottoms_Up on 11.07.11 at 11:15 pm

Garth, a person retiring today has almost 50x the net worth that I do, the largest wealth gap ever recorded:

http://www.boston.com/news/nation/washington/articles/2011/11/07/us_wealth_gap_between_young_and_old_is_widest_ever/

What caused this gap? Likely inflation, government and bank policy, rising house prices, rising stock markets etc. (in addition to innovation and hard work)

Well guess what? People my age don’t have the money to buy frivolous ‘assets’ such as boats, cottages or cane collections. In fact, the only ones with ‘money to burn’ are those that got into the housing market years ago (I have friends, for example, that were able to wipe out $100,000 of student debt simply because they ‘bought’ a house in 2001). Those of us that bought homes only in the past couple years are tapped out and very unlikely to see similar gains.

As you’ve mentioned before, I think we are definitely entering a period of contraction in prices of frivolous items, and in the face of rising costs for essentials such as food and energy.

I know that my own household income is above average for the Ottawa area, yet we live in a very modest 2-bedroom, 1500 sqft townhouse and still have difficultly making ends meet, with little left over to even think about things such as an emergency fund, family vacation, buying a 2nd car or cottage.

How did you say this was all going to end?

#9 kc on 11.07.11 at 11:17 pm

HMMMM funny they are reporting on Global National that the reason for the advancements in RE prices was because of the renos every one is doing… hmmm still trying to flog a dead reno horse that has pretty much puffed its last breath?

http://www.globalnational.com/GlobalNational/video/average+home+value+doubles+remax/video.html?v=2165374736&p=1&s=dd#video

#10 Renters Revenge on 11.07.11 at 11:18 pm

So Harper is getting nervous. His “steady” hand on the canadian economy is losing it’s grip and now he’s worried about his legacy.

“Prime Minister Stephen Harper says managing the Canadian economy through a global crisis will define his place in the history books, but his life’s biggest ambition is to raise happy kids.”

http://www.ipolitics.ca/2011/11/06/pm-says-he-has-many-ambitions-but-his-kids-come-first/

#11 Ronaldo on 11.07.11 at 11:19 pm

http://www.canequity.com/no_money_down_mortgage.stm

http://www.bcmortgageactioncenter.com/mortgage-no-money-down-canada.html

http://www.discountmortgagecanada.com/nomoneydown.asp

http://www.ontarioequity.com/no_money_down_mortgage.shtml

http://www.albertaequity.com/mortgage-products/popular-products/no-money-down-mortgage.shtml

Seems there’s no end to the money available to buy houses with nothing down. Why is this being allowed to go on?

#12 wetcoaster on 11.07.11 at 11:20 pm

Watching the Victoria media lap up this ReMax crap is disgusting. The TC rag has pumped the so called condo building boom twice this week when infact the largest player Chard just pulled the pin on a major development in the downtown core due to perceived market conditions. The pathetic hoes avoided mentioning that one.

#13 Bottoms_Up on 11.07.11 at 11:22 pm

#4 Mark on 11.07.11 at 11:03 pm
——————————————
What could be undervalued?

Natural gas
Oil
Food
Some brands of new cars
Justin Bieber

#14 Elmer on 11.07.11 at 11:27 pm

Garth, can you stop posting disgusting pictures? Thanks.

Do you have any idea how much oil I had to use? — Garth

#15 JohnnyBravo on 11.07.11 at 11:34 pm

This is the fault of the government, bankers and central bankers. They caused this problem with cheap credit/money. Cheap money is the surest way to undermine a society. When that which is a proxy for all goods and services, and which binds a society together for the common good, loses its value, everything else does too.

Yes, RE agents, mortgage brokers and the public played a role. And ultimately, each must shoulder some of the blame if individual responsibility still means anything. But people are not greedier today than they were thousands of years ago. We merely try to make the best of, and take advantage of, the system within which we are forced to live.

We the people are manipulated, whether by design or not, into acting against our own personal and collective long-term interests. Mediocre people in a good system can produce good results. But great people in a bad system will produce bad results. Our system isn’t just bad, it’s totally corrupt. And we all know it.

#16 Aaron - Melbourne on 11.07.11 at 11:40 pm

“CHOICE” – The people’s watchdog

Real estate’s influence on newspapers

Should you believe everything you read in the property section of your newspaper?

CHOICE investigates.

Page 1 – The big sell

Real estate sections in newspapers seem to be getting bigger, despite the fact that print media advertising revenues are steadily declining, along with circulation figures.

Through this investigation, CHOICE has found the distinction between advertising and editorial in the real estate press is largely absent. The industry has argued that the property section is commercial, but this distinction may not always be clear to consumers.

Vested interests CHOICE has found examples of real-estate industry professionals portrayed as ‘everyday’ men and women in positive property market stories.
Perks including favourable profiles and overseas junkets, provided by newspapers in return for real estate agencies reaching sales targets.

No room for criticism The relationship between media and real estate is apparently so cosy in some instances that big spenders are kept happy at all costs.

http://www.choice.com.au/reviews-and-tests/money/investing/property/real-estate-puffery.aspx

– Four pages

Choice Australia

http://www.choice.com.au/

#17 JohnnyBravo on 11.07.11 at 11:43 pm

“Do you have any idea how much oil I had to use? — Garth”

I thought I recognized the guy on the right.

#18 Nemesis on 11.07.11 at 11:43 pm

“And it’s all broadcast as good news by a media which lost its way when valueless corporations slipped into the editor’s chair.”… – Hon. GT

It wasn’t always that way, was it…

I really miss Harvey S. (and Susan)…

Sigh.

PS – thank you, Nostra – again! For your indefatigable research/aggregation (saves some of us a lot of clicking). And you, too – GT, yet another great piece (SmartyPants).

#19 Unistar38 on 11.07.11 at 11:44 pm

Dear Garth,

Off tonight’s topic.

I voted for Mr. Harper a couple of times because of the TFSA. At the time, I did not know that it was you who pushed through this idea.

Thank you so much for doing this for average Canadians. Please accept my sincere appreciation. You have my utmost respect!

#20 Naga on 11.07.11 at 11:45 pm

Garth – over the past few weeks you ave published some interesting blogs……and amazing pics.

My take of today’s situation (economy, finances and politics is that for everyone this is a time when not loosing money is more important than making it. This means regardless of your age – if you ave debts and have a job paying them down is your first and only priority and also to keep your job. If no job get one or more than one.

However, because of the shape of government finances the only way out is for a period of inflationary depression.

Some signs to look for:

1. Intalian Stallion (SB) tells bond traders to get stuffed. Why after a number of years of reforms and more austerity proposed and a number of years of NO BUDGETARY deficits should Italy be held at ransom to roll over old debt at absurd rates? The Stallion will get Italy out of this mess just as he made zillions of Liras (Billions of Euros) for himself – Obama needs to take note from the Stallion or Clinton and diversify his personal love life to be reelected;

2. Other European countries (PIIGS) will get a similar hard on to default their way out of their current situation – France and Germany have no business in political outcome of other european countries until such time as Europe votes for a represenative government;

3. Cost of energy (net of taxes) will go down due to shale gas and oil resources – watch traditional oil producing countries and Russia blow up with internal fiscal issues when their revenue from oil dries up;

I have no clue if this inflationary depression has started or when it will start, nor if it is any better or worse than a deflationary one – in either case the smart money sits on the sidelines. I have no proof – but I have been told that there is over 3 trillion $US in the US sitting on the sidelines waiting to pick up the prey.

I am trying to find out more about the mechanics of a inflationary depression – but I think that as long as you have cash flow from whatever source – and no debts -one should be OK – everyone else is screwed.

#21 Onemorething on 11.07.11 at 11:50 pm

Wait until those boomers run out of retirement money, look to reverse mortgage or support family in the downturn! They will be dumping RE with no losses even if a retracement to 2003 levels are coming.

It’s not how much money you make it who looses the least in this game. And honestly, these are all paper gains anyhow!

The only way you win with a reverse mortgage is by dying. But, hey, it’s a strategy. — Garth

#22 cxcroney on 11.07.11 at 11:56 pm

#10 Renter’s revenge

“Harper’s biggest ambition is to raise happy kids.” I’m sure that his Gold Plated Pension Plan will help his kids be happy when the time comes. And by the way, how are we all feeling today? $92,000 poorer?

#23 Calgary Bubble on 11.07.11 at 11:58 pm

Its ridiculous that Re/max can put this out and call it news. Its not based on any facts.

They are claiming / implying that the rise in prices in the last decade is due to home renovations, building houses, oil, etc. Anything but the obvious flood of lending by the banks, and the low interest rates that sustain the prices.

I guess when you imply things your not really lying.

I guess when you say things, play dumb, and don’t support your reasoning your not really lying.

I guess falsifying news is not really a crime.

I guess Re/max are not really criminals.

How far can you push the false news before its criminal? Is it when its common knowledge that the things your saying are lies to everyone else. Isn’t this about now, aren’t we getting to the point where people realize what has been happening and what is happening now to real estate.

I guess we’re all in denial because we all own real-estate.

and no one is going to do anything about it, were all screwed.

#24 TaxHaven on 11.07.11 at 11:59 pm

“If Republicans win, spending stops, winter begins…”

You’re a traditionalist…a Keynesian! Someone who believes in spending money you don’t have. Somone who doesn’t believe in building savings, in capital accumulation.

For somone who daily grills the saving-less, big-spending borrower that’s hard to fathom.

Someone who wants to continue robbing future generations…or perhaps you seriously think REAL, non-credit dependent growth will return sometime soon and save us all?

Like Europe is doing…adding MORE debt, while praying for growth to bail them out of their debts…

BTW, we WILL get the same results. Either through continued easy credit, printing, borrowing and competitive currency devaluation leading to raging inflation

~ OR ~

…through cutbacks, layoffs, limits to borrowing, price deflation, a downsizing of government and 15%+ unemployment. Which will end eventually…

#25 Jsan on 11.08.11 at 12:11 am

Isn’t this what usually happens in the final hour of a bubbles death throe. No longer can they brag about monthly or yearly advances, now they have to put the spin on using decade advances. Why stop there? What’s next for the pimps ………..errrrr…….purveyors of real estate, are they going to start comparing real estate prices to what they were a Century ago?

When the inevitable meltdown comes and it’s time to buy, remember which companies shamelessly flogged sky high real estate prices and take your business elsewhere.

#26 Jack the Land on 11.08.11 at 12:11 am

Garth wrote:

“Sadly, this is nothing to be proud of. Cities become expensive, then unlivable. Tensions rise and dreams die when children realize they will never afford their family home, even when they earn multiples of their parents’ income. We look to cast blame. Foreigners are an easy target.”

— Story of my life, Garth. But I don’t blame the Foreigners.

Instead of driving around Van and knocking over ‘Lawn Asians’ out of resentment, I turned the tables and said if you can’t beat them, join them.

So I married one.

I now sleep with my ‘Lawn Asian’ every night.

The Asians might be screwing you all in Van, but I’m one of them… every night.

#27 Paolo on 11.08.11 at 12:16 am

Is the party finally over in the coming year?

#28 Soylent Green is People on 11.08.11 at 12:16 am

You finally post some pics of half naked guys who work out… why am I still puking in my mouth?

………………………………………………

G&M: If Steve Harper’s an economist, I’m the Queen of Sheba.

The ammunition to bury the Conservatives is overwhelming. Yet a majority of Canadians still don’t see it.

http://www.theglobeandmail.com/news/politics/second-reading/gerald-caplan/if-steve-harpers-an-economist-im-the-queen-of-sheba/article1769401/

………………………….

repost from microbe 3:12 PM on April 28, 2011

Before you accept the G&M’s endorsement of Harper and the Tories as “good economic stewards”, read this short article:

http://rabble.ca/blogs/bloggers/progressive-economics-forum/2011/04/stephen-harpers-



#29 Soylent Green is People on 11.08.11 at 12:17 am

Re #19 Unistar38

Death to the Unistar38, and all retards like it.

……………………………

repost from Open Democracy 6:26 PM on February 18, 2011

Other than himself, Stephen Harper’s worst enemy is his inability to deliver on many issues. In Budget 2010, he promised budget freezes would help reduce the deficit by $6.8 billion over five years. It sounded great on paper, however, since then, departmental plans show a tiny and insignificant fraction of the necessary staff cuts will be made.

Here are the details of yet another flip flop by the Harper government:

http://viableopposition.blogspot.com/2011/02/harper-government-cost-control-fact-or.html

.
.
.
.

#30 Tim on 11.08.11 at 12:21 am

Re #10
That makes me want to vomit. Harper inherited a big surplus from the Liberals and he has pissed it away. He has spent like a drunken sailor, racked up the biggest debt of any Prime Minister. He is a disgrace to Conservatives

#31 Smoking Man on 11.08.11 at 12:22 am

CTV just pumped Real Estate yet again.

The herd, the ones traped, void of the knowlage of The Hegelian Dialectic

Will keep the game going……………..Thank you Teachers

Job well done

#32 Habs76-79 on 11.08.11 at 12:26 am

“And it’s all broadcast as good news by a media which lost its way when valueless corporations slipped into the editor’s chair.”… – Hon. GT

———

Best quote about this situation I’ve read in a long time Garth. I’d like to borrow it from time to time when I discus in real life with others and online in other places the image of the modern day media we are almost assaulted by daily.

My dad and I were talking about stuff today and I noted that the MS media in Canada is even more corporate controlled as licks-piddle, mouth pieces than those said to be oh so evil and corrupt media outlets in the Excited States of America. BTW that ain’t saying much to either country’s MS media.

Responsible and true investigative journalism in just keeping it to say Canada and the USA has died a long time ago. The corpse of such in both country’s need to be buried, they are rotting and stink real bad now.

#33 Bill Gable on 11.08.11 at 12:29 am

Global TV ought to hang it’s head in shame. They use a moron named Ms. Henn to hype housing.
Miss Henn is about as qualified as the unfortunate Sarah Daniels – ex Global TV talking head, and now RE agent, and TV host.
The duplicity makes me sick.
Happy rainy night from Dumbcouver.

#34 Peter Goesinya on 11.08.11 at 12:44 am

Imbalances (in an economy) can build up far longer than seems logical. Things that go unchecked for longer periods than they should typically take longer to resolve than they otherwise might. I continue to be concerned that we currently are in a ‘postponement period’ that will come to haunt us all in a severe way when Humpty Dumpty, the egg with increasing cracks, falls from the wall

#35 terces on 11.08.11 at 12:48 am

At the same time as F is re-writing his budget he should stop wagging his self righteous finger at europe. We are a little pip squeak in the world with .5% of the world population and something over 2% of the world economy. Because of timing and good luck our real estate has not tanked – yet. But our time is nigh.

#36 the Phantom on 11.08.11 at 12:48 am

Hi Garth and fellow bloggers.

Certainly it has always been and will continue to be in RE’s best interest to put a positive spin on everything even if it happens to be bad news. That is simply what they are trained to do. There are compelling reasons however to more carefully scrutinze the claims they make.

the Phantom

#37 DonDWest on 11.08.11 at 12:49 am

4# “So if housing is so overvalued…by definition, something is undervalued.

What might that ‘something’ be?”

Water.

#38 1drs on 11.08.11 at 12:59 am

Today , just before the Remax “news” piece, I saw an analyst on BNN calling for a drop in Canadian Interest Rates. Now I see it. Even lower rates to suck in the last of the hapless. Buy now or be priced out forever,now with even lower rates ! Has this government no shame? Will they continue to pump up the mortgage market even when it is so obviously dead? This stuff is so disheartening . The longer this goes on the worse the crash must be. I am so glad that I am mortgage free and debt free. I feel so sad for those that are falling for the crap that is passing as news and buying into a doomed market.
Thank you Garth for the education on how to save my self. And the price was right too !

#39 Aussie Roy on 11.08.11 at 1:06 am

Aaron – Melbourne on 11.07.11 at 11:40 pm

“CHOICE” – The people’s watchdog

Real estate’s influence on newspapers

Should you believe everything you read in the property section of your newspaper?

CHOICE investigates.

Page 1 – The big sell

…………………………………………………………………….

Haven’t I seen this before?, in the same format a few days ago?. Thats right, its my post, good article excellent cut and paste.

…………………………………………………………………….

Aussie Update

So Gail Kelly our famous Wespac bank CEO says
“It’s meant that we don’t have further asset bubbles. And property prices, while they’ve softened a little, they certainly haven’t fallen”.

Well that’s handy to know, no asset bubbles here and house prices haven’t fallen they have just softened a little.

http://www.abc.net.au/insidebusiness/content/2011/s3357263.htm

So that’s it folks, even when house prices fall, they don’t really they just soften.

A respected female bank CEO wouldn’t lie would she?.

#40 earlymidlifecrisis on 11.08.11 at 1:10 am

Thanks, that’s one of my favorite postings lately. Stop blaming immigrants when its our own governments policies that are fueling this. Late entry Re ‘Karma’: I wonder if the developers are pre-branding here in Van b/c quite a few times during my (rental) home search I have seen the title ‘Karma’ and it’s not a rental suite but a tidbit telling that something good is coming…..

#41 Nostradamus Le Mad Vlad on 11.08.11 at 1:16 am


“How could it be more obvious what lies ahead?” — This is a little old, but there was an update on CHBC-TV news tonight.

Story is of a First Nations band close to Prince Rupert, bought land and a tree licence for $10 mln. from the former owner, eventually struck a deal with a company a couple of hours outside Shanghai, and are now doing very well by chopping the trees down and selling them raw.

Ploughing the new-found money back into their community, new paved roads, new community centre, everybody in the Band (3,500 or so) are very happy — they all have something to do, keep themselves busy with.

2010 sales were a bundle, next year they are trying to double that. No govt. interference, no red tape — raw logs exported and Chinese labor does the rest.

Russia used to have 60% of the Chinese market, but because the BC wood is better quality, they switched to importing 80% of their lumber from here. Good story.

“The promise made in the election (six months ago) . . .” — H – F are politicos and first class liars. Should we expect any less?

“Spitting in the face of reality, Unless the laws of economics no longer apply.” — Don’t bet against it, as far stranger things have happened. Put Re/Max directly with the politicos — they are all a bunch of lying, disorganized whacknuts.
*
#197 bullion.bunny on 11.07.11 at 10:24 pm — Excellent link!

#18 Nemesis — No trouble!
*
Lucifer’s Lottery Citibank hits the jackpot again! US Fed sells assets, borrows cash (quagmire time); Berlusconi has a love of power, which may cost Italy; 97% Youth unemployment over UK; Italy defenceless; Athens grovels to EU.

Dracula Returns (sorry, Drachma); PolitEuro; Bonuses for banxters; Three Countries See head and know we are controlled by outside forces; EU bailout fund The pot is empty; Frozen Lamb, Young People catching on; 5:33 clip Niall Ferguson says the west is failing unless it works harder.
*
Malignant Narcissism Odear; RE Porn Not quite. This is the real stuff, with Ryanair applying for a licence to show it.

Slow death Fukushima, 26:42 clip Oregon and Washington states — airborne radioactive particles; North Anna nuke plant, cover-up of seismic knowledge; Border checks axed so the UK doesn’t know how many illegals it has; Ageing halted in lab (that’s because we’re all robots); Pakistan’s Nukes Reason enough for the US to go in, but the other country gets off scot-free; Parkinson’s Stem cell research; Russia They have made their point.

#42 BPOE on 11.08.11 at 1:25 am

As 2011 comes to a close we end another stellar year. Even this blog is slowly slowly coming around to the conclusion that real estate is the real deal. BPOE will never end. It has nothing to do with ending well or unwell. It simply will never end. America on the other hand is finished
http://www.theglobeandmail.com/report-on-business/top-business-stories/poverty-and-unemployment-the-american-dream-is-dead/article2222393/

#43 mad vancouver on 11.08.11 at 1:28 am

http://www.youtube.com/watch?v=QoOKY5kH9cc&feature=player_embedded#!

Canada’s economics 101

#44 smartalox on 11.08.11 at 1:29 am

What happens if you’ve taken a ‘reverse mortgage’ and the value of your home declines? Can the lender call the loan?

#45 BPOE on 11.08.11 at 1:31 am

The desperate rantings of a mad man completely disconnected from reality. Time to take your ball and go home. You lost PERIOD
***************************************
However, I do not believe the Canadian market will have this “soft landing” that many continue to preach. The market is just beginning to show signs of cracking to the masses. Yes, its been stressed over the past year there, but now it is cracking, and reports are becoming more opaque to consumers. These reports have a LONG way to go before they’re truly transparent, though. This will happen in time, and as it happens, the real estate decline will accelerate. My point I believe that the market in Canada will overcorrect as well. The bigger the bubble, the louder the pop. Canada’s bubble is of unprecedented proportions, which will propel the accelerated decline. Low rates do not salvage “values” in a home, contrary to what I so often read in this blog by some of its posters/posers. Instead, they fuel bubbles, draining consumers of all expendable income and causing for on-boarding of gross indebtedness to the banks. Then, the rates rise ever so slightly (the tiniest pin in the huge bubble), and it’s all over. Then, the only thing left to do is to lower rates again in hopes of incentivizing consumers to pick off excessive inventory that is now 50% of its original value (think Bend, Oregon for example). But, consumer confidence is low, and it quickly turns into a race to the bottom.

#46 Ben on 11.08.11 at 1:31 am

Two years ago nine in ten new mortgages were taken for 35 and 40 -year amortizations

#47 SophieZombie on 11.08.11 at 1:34 am

”Tensions rise and dreams die when children realize they will never afford their family home, even when they earn multiples of their parents’ income.”
This sentence should be the epigraph of The Manifesto of Generation Screw.

#48 City Slicker on 11.08.11 at 2:00 am

Did anyone else see BNN Headline tonight. The topic was Canadian RE, and much to my shock all the talking heads agreed Canadian RE is grossly overpriced and due for a major correction. Nice MSM is starting to warm up to the idea and embrace it.

#49 VancouverJoe on 11.08.11 at 2:18 am

>>>> #4 Mark on 11.07.11 at 11:03 pm
>>>> What could be undervalued?

– dignity
– honesty
– responsibility
– conscientiousness

Wanna buy some? :-)

#50 Crash Callaway on 11.08.11 at 2:23 am

” Bragging, in a real estate macho contest.
Sadly, this is nothing to be proud of. Cities become expensive, then unlivable ”

That says it all Garth.

#51 betamax on 11.08.11 at 2:25 am

#21 Onemorething: “They will be dumping RE with no losses even if a retracement to 2003 levels are coming.”

Think again. They’ve been borrowing against bubble appreciation for years. I know several boomers who are living it up on borrowed money. Prices go back to ’03, they’ll be greeting folks at Walmart till they die.

#52 jas girn on 11.08.11 at 3:09 am

It seems to me that the RE climax/SHTF is coming soon. I cannot wait to see all the idiots revert back into saving money. BTW, Garth is a good man.

#53 Mike on 11.08.11 at 3:11 am

Elmer: grow a pair

Garth: great post

#54 Jane24 on 11.08.11 at 3:32 am

Surely when a company claiming to be an expert in the field (Remax) claims publicly that house prices will continue to blister up and they don’t, will be liable for some Fools RE poor purchases. Remax is offering professional advice here through this press release.

#55 dddd on 11.08.11 at 4:36 am

the mentally challenged firsters out in force tonite.

do these people really not understand how a blog works? or do they just like to display there foolishness?

#56 dddd on 11.08.11 at 4:52 am

AND YES IT’S THEIR not there

but EVERY f’n day , the same thing.

#57 Peter Goesinya on 11.08.11 at 5:08 am

Oh good god, I can’t stop looking at that picture!

Don’t you think China would be happy to lend Europe some of the trillions of Euros it needs to recapitalize its banks, save Greece, and prevent a crisis in Italian and Spanish bonds…as long as the Europeans posted gold as collateral for the loan?

#58 Aquarian on 11.08.11 at 5:16 am

I don’t know how putting a roof over your head got to be confused with investment.
However so many people are in so deep that I don’t think governments will be able to stop propping up real estate markets through whatever means possible.

#59 Taipan on 11.08.11 at 5:21 am

The only thing that has hit canadian housing prices in the last 10 years in a negative way was GFC1.

Youd better all hope that you get a contagion of sovereign debt issues starting in europe that scares the crap out of all those on the coolaid.

Its the only way you will have an impact on the decade of brainwashing that real estate only ever goes up.

Your government is inept, first moving to 40/0, then back to 35/5 and then 30/5 but still allowing 0 deposit property transactions.

Interest rates continue to be barely above emergency settings.

The european bond markets are under attack. Italian bonds are screwed. Italy is about to come under sustained attack in the markets.

Things are so delicately poised it will only take a small breeze to bring everything down.

Garth you have been very right about the massive issues of excessive debt causing housing bubbles. Sovereign debt is merely an extension.

Will the world end? No – Just ask those in USA and Ireland, spain etc. But it isnt pleasant.

And there is no avoiding this outcome

#60 Wise Guy on 11.08.11 at 6:03 am

Here on vacation in the UK, it is amazing how housing has reversed. My Aunt told me that it was only a few years ago, when people were buying homes worth 6X their household income, but now it has normalized a lot more, where people are paying close to 3X household income.

She has had her house on the market for 8 months and has had only 1 viewing!

She also told me how the banks used to give out mortgages with nothing down and the bare minimum, but now it is very hard to qualify for a mortgage unless you have at least 25% down.

Housing is no longer seen as a rising commodity here.

#61 Young Old Fart on 11.08.11 at 6:04 am

#2 Leslie on 11.07.11 at 11:00 pm
Now I am first. And a woman, to boot.

===================================

Sorry Lady, still second…….. ;)

#62 AM on 11.08.11 at 7:30 am

The desperate rantings of a mad man completely disconnected from reality. Time to take your ball and go home. You lost PERIOD
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
“As 2011 comes to a close we end another stellar year. Even this blog is slowly slowly coming around to the conclusion that real estate is the real deal. BPOE will never end. It has nothing to do with ending well or unwell.”

#63 David B on 11.08.11 at 7:58 am

Nothing changes, nothing changes ….. Greed is Good … so get out there and buy, buy and sell-sell to Greater Fools because they are making them every day eh

South of border a recent poll (NYT) has just stated most Americans believe the rules favour the rich and will continue and no government is in a position to either do anything about it willing to do.

So there you go …. Real Estate owns front page news beit newsprint, radio or TV … ie To night on CTV news, Real Estate is up as prices sour across the country or CBC and local channels take your pick …

There you go ….. since 2008 Garth?

#64 bigrider on 11.08.11 at 8:16 am

#48 Cityslicker.

I looked for the link on BNN website and couldn’t find it.

Could you post if you have it?

Thanks.

#65 fancy_pants on 11.08.11 at 8:36 am

great post…
What a messed up planet.

#66 yorel on 11.08.11 at 8:46 am

All this stuff about Harper. Would someone tell us what the other parties would have done differently? I don’t remember much discussion from them about real estate, but that’s just me.

#67 Macrath on 11.08.11 at 8:48 am

“It’s this logic which drove me to publish a book called ‘Greater Fool’ in early 2008, then start this pathetic blog.”
_____________________________________________________________

And an excellent book it is. I particularly like the part about having a home with a future. Energy efficient , close to transit and services, etc…..
Timely advice due to the rising cost of everything and the ZIRP income squeeze.
The end days of a litre of gas for a litre of milk are fast approaching.

#68 Ron on 11.08.11 at 8:50 am

“How could it be more obvious what lies ahead? Glacial growth, less government spending and falling exports. Governments and families tapped out as never before. Europe and America in no mood to buy our stuff. This will mean more lost jobs and stagnant household incomes. Unless the laws of economics no longer apply.” -Garth

Time to admit you were wrong about “leaving the bathroom”?

No. Smart people prosper in all environments. — Garth

#69 Kevin on 11.08.11 at 8:54 am

“But don’t stop there. Greedy sellers, irresponsible agents, horny buyers – the victims of human greed and desire – blame them, too.”

I don’t think you can blame individuals for acting rationally. Their actions are the product of simple economics. The sellers were looking to maximize their profit. Of course they were. Why wouldn’t they? In what context would it make sense for them to settle for less than they know they could get? Out of altruism? If they list their house for $250,000, and they get offers for $265,000 and $275,000, what are they supposed to say? “Guys, guys, thanks for the offers, but we only wanted $250,000. This couple offered first, so we’re going to sell to them. Keep the extra $15,000, $250,000 will be fine, thank you all for coming.” That’s absurd.

Even moreso with the agents. They’re in a competitive market. Why would they not try to get the maximum price for their clients, both to maximize their own commission, and to boost their reputation and drive future word-of-mouth business their way? Again, they were simply acting rationally.

The only one I do agree with blaming is the politicians. They’re the ones who set the rules for this high-stakes game, and they’re supposed to be acting in our best interests. They’re supposed to have done the research and consulted the experts, and set the parameters and regulations to protect our economy for the long term. And they dropped the ball.

The vendor technique of choice has been to list below ‘market’ value in order to ignite a bidding war, in which fair value is exceeded. Hence, greed. — Garth

#70 Lead Paint on 11.08.11 at 9:01 am

“…by a media which lost its way when valueless corporations slipped into the editor’s chair.”

Bravo Garth, that’s beautiful. Have you read Chris Hedges? My favourite financial advisor is now sounding like my favourite author, it’s gonna be a good day.

#71 Middle Goldfinger on 11.08.11 at 9:02 am

“Residential property prices are in freefall in China” – Forbes / http://whispersfromtheedgeoftherainforest.blogspot.com/2011/11/residential-property-prices-are-in.html

Over the past week and a half stunning price cuts are turning up everywhere. One builder — Excellence Group — even said it would sell flats in Huizhou at its development cost.

Citi’s Oscar Choi believes prices will decline another 10% next year, but that’s a conservative estimate. State-funded experts are far more pessimistic. For example, Cao Jianhai of the prestigious Chinese Academy of Social Sciences sees price cuts of 50% on homes if the government continues its cooling measures.

If China’s ‘approved’ analysts are saying prices could halve in a few months; you can be rest assured they believe the eventual sell-off will be worse.

Legendary investor Jim Chanos has long been bearish on the China Real Estate market and has said that China will be “Dubai times 1,000—or worse”. He has said that what will play out is the unwinding of “the biggest housing bubble ever created”.

As goes China, so goes BC and to an even greater extent, the GTA. Contrary to popular belief, the Asian population in the GTA is far greater than in Vancouver.

#72 Myopic Mel on 11.08.11 at 9:03 am

“Avaricious lenders and myopic central bankers are central to the story…”

Garth, in a previous post you stated that the central bankers would be able to handle the situation in Europe and now they are being referred to as myopic. Are you still of the opinion that these myopic central bankers have the situation under control?

The myopia clearly refers to emergency interest rates, not coordinated global macroeconomic policy. — Garth

#73 young & foolish on 11.08.11 at 9:12 am

Aquarian:

“I don’t know how putting a roof over your head got to be confused with investment.
However so many people are in so deep that I don’t think governments will be able to stop propping up real estate markets through whatever means possible.”

RE has become commodified. Most people buy on what they can carry on a monthly basis and hope that when they need to exit they won’t get trapped. Risky.
As for governments keeping the party going, well consider that RE now accounts for a greater share of the economy and many well paid jobs have already disappeared in manufacturing and middle management.
What do you expect from the politicos?

Feeling “priced out”? Don’t worry, Mr. Market will eventually make sure you get what you need. After all, most RE is a necessity, not a frivolous luxury.

#74 househornyhousewife on 11.08.11 at 9:12 am

Garth,

That photo almost made me loose my breakfast .. UGHH ! (there’s something to be said for at least a little bit of fat in the right places).

At the moment, I have it in more for the greedy sellers and their agents than for anyone else. I am used to greedy banks and governments but have only recently been introduced to greedy sellers and their agents.

Around here, the sellers are unrealistically greedy and even my own real estate agent cannot believe what some people are asking for their property. By unrealistically greedy I mean that none of these people can even hope to get anywhere near what they are asking. Only the lower end housing is still selling like hotcakes around here these days (in my neck of the woods anyway .. here you can buy a nice bungalow for around $200,000.00) so all that the higher end greedy sellers are getting is some peace and quiet (cue the crickets).

At least around here the greedy sellers and their agents are getting only what they deserve, as opposed to the bigger urban centres where ignorant buyers are still buying into expensive and fraudulent deals (this is what I would call it … hey, you wanna buy a Rolex made in China … $3,000.00 but it will appreciate with time so go for it … well DUH !).

As always, great post Garth.

HHHW

#75 Diana on 11.08.11 at 9:17 am

@ #14 Elmer on 11.07.11 at 11:27 pm
Garth, can you stop posting disgusting pictures? Thanks.

Speak for yourself my friend. They can detail my Harley anytime.

#76 Ret on 11.08.11 at 9:43 am

Politicians in Canada love to talk about fiscal responsibility. The electorate eat it up. To actually implement any form of an austerity program would be political suicide and every Canadian politician knows this. Preach from the right, spend from the left.

Any party that federally reduced pension checks by ten cents, cut out provincial junior kindergarten programs, or municipally cut any funding for arts or festivals, would be toast. Canadians love Canada, but paying for the party, not so much.

When governments run out of credit, it will be, “Save the country be damned. We are Canadian taxpayers and are entitled to our entitlements just like any politician or civil servant.”

Party on Canada!

#77 disciple on 11.08.11 at 9:50 am

#24 TaxHaven… I have found that you’re directly in my cross-hairs this week, sorry. Let me blow another hole in your logic: the function of government is to go into deficit, with the promise, of course, that labour and technology will satisfy the demand that has been pulled forward. You’re not seeing this. Shall I repeat it? The only way to not go into deficit is to not have government. I believe this to be the future, but it is not now the reality because we have dastardly enemies of humanity we must first deal with.

The problem at hand currently is not that we have governments (whose only function is to borrow and create deficits). The problem is that they borrow from private families at interest. Read that last sentence out loud a few times to let it sink in. This is the crux of the problem. It’s completely unnecessary. Compound interest is the dirty little secret. Entire nations on this planet operate without the need for interest. These are the ones being targeted by the international banking cabal.

#78 T.O. Bubble Boy on 11.08.11 at 9:55 am

So, let’s say you’re a teacher in Ontario, and your pension plan now runs a mortgage insurance business:
http://www.canadaguaranty.ca/about-us/

If you were teaching kids about mortgages (say in a high school math/economics class), would you teach them that mortgages are typically taken out with less than a 20% down payment, and need insurance on them?

(maybe Flaherty could write the textbook!)

#79 UK Love Calling on 11.08.11 at 10:00 am

BPOE what you write is utter rubbish and trash. The reason I know America will rebuild from the ashes is because they have one thing you would not be aware nor would many Canadians, much like the individual who wrote that trash that you cling to. They have spirit. American spirit is an intangible asset that no amount of statistics can account for. It is unstoppable and it is this spirit that allows them to reinvent themselves every thirty to forty years even stronger. In case you missed it my post from two days ago summed it up.

Gotta admit that those damn Yanks are geniuses in times of toughness. Seems like in times of adversity their creativity sings to the world. In this instance I look to Maroon 5 and Christina Aguilera which are American artists with awesome talent. Americans know how to pull themselves from the muck when times get tough and they do it with music and entertainment. Look at the Great Depression. The world always follows suit. Katie Perry, Kesha, Lady Gaga, they’re all keeping it moving along with a great show and hope. Never bet against America people. Move Like Jagger – Best damn song of the year I guarantee it!!! What people aren’t seeing is how these videos epitomize the meaning of being American as the details are in the subtlety of the humor. Depressions yield humor and stellar entertainment. Nobody gets it better than the Americans.

http://www.youtube.com/watch?
v=ZQsK9WzDiuM&feature=mfu_in_order&list=UL

http://www.youtube.com/watch?v=tyL9H5n_sxQ

http://www.youtube.com/watch?v=EVBsypHzF3U

http://www.youtube.com/watch?v=QeWBS0JBNzQ

http://www.youtube.com/watch?v=wV1FrqwZyKw

http://www.youtube.com/watch?v=KlyXNRrsk4A

http://www.youtube.com/watch?v=LiD72NS3UHQ

http://www.youtube.com/watch?v=pzh5VaHyKoY

#80 UK Love Calling on 11.08.11 at 10:04 am

Oooops broken link. Here is the good one.

http://www.youtube.com/watch?v=iEPTlhBmwRg&ob=av2e

#81 disciple on 11.08.11 at 10:10 am

Call of Duty 3. Expected to be the single biggest entertainment revenue generator of all time. Total madness. JohnnyBravo, our world is not only corrupt, it’s thoroughly insane. I told you. An entire generation of youth hooked to military violence… for entertainment? At least Benny Hill had more humanity… There is a great and terrible war coming. Unfortunately, the fulfillment of my prophecies approach sooner and sooner.

Doug Holyday is an embarassment to the city of Toronto. He is utterly clueless on just about everything and has his “staff” do everything but clip his toenails (hmmm…. I wonder about that too).

These puppets you have “elected” including small businessman Rob Ford are coming after your pensions, after your social welfare programs, after your retirement money. And you thought it was just the bums on the street who don’t want to work that they were targeting. You’ve been duped, yet again.

The major investment banks have been stealing these funds from you for years through fraud involving the transaction dates on their trades. But they want it all, and they’re gonna get it, friends. Because you let it all happen, blaming each other when the real perpetrators sit in Parliament collecting their collective collusive cuts.

Scandals in the RCMP. Why am I not surprised? Scandals in the Senate. Both former members of these exclusive clubs, speaking out, now that they have nothing to lose. How brave. But how different from even the G-man himself, while hardly an angel, was willing to risk his career for something he believed in. Respect. It is earned, not commanded. One of the greatest ideals my father ever taught me.

#82 Daisy Mae on 11.08.11 at 10:20 am

“Bravo, Re/Max. You scored.”

********************************

This is nothing more than a ‘last ditch’ effort.

All people have to do is take a good look at their financial situation, the global financial disaster, and what is happening in their own neighbourhoods to simply come to the realization RE/MAX is running scared….and people will.

#83 City Slicker on 11.08.11 at 10:57 am

#64 bigrider on 11.08.11 at 8:16 am #48 Cityslicker.

I looked for the link on BNN website and couldn’t find it.

Could you post if you have it?

Thanks.
——————————————————
I tried to find the video last night on the website, as the host said it would be there, but could not find it.
It played about/between 4:30ish to 5:30ish Calgary time. I looked this morning without success. Busy day today so I won’t have time, but if anyone else wants to search for it online then please post.
They also mentioned exactly as Garth said yesterday, I think, about the over building of condos in GTA.

#84 disciple on 11.08.11 at 11:01 am

China has little to be proud of. Even Chinese people hate the Chinese authority. Their “all-other-children-must-die policy” of no brothers or sisters allowed is ghastly beyond measure, especially when they go in and literally rip out eight-month old fetuses and require young women to undress in front of the birth-planning doctors in order to check for pregnancy and re-qualify for wages.

But it would be a shock to most of you to learn that the same families behind this monstrosity are the same families who run Wall St. Yes, the oppressive Chinese regime is run by Western financial corporations. Didn’t you already know that?

If not, your ignorance of this is nothing to be proud of.

#85 disciple on 11.08.11 at 11:04 am

Forgot to add the link for more info:

http://www.theepochtimes.com/n2/china-news/chinas-harsh-enforcement-of-one-child-policy-62111.html

#86 City Slicker on 11.08.11 at 11:07 am

64 bigrider on 11.08.11 at 8:16 am #48 Cityslicker.

I looked for the link on BNN website and couldn’t find it.

Could you post if you have it?

Thanks.
———————————————————
One of the guests on the show said there are more cranes going in GTA for condo buildings than all North America, or something along those lines. I think he was exagerating, but you know what he is saying.

Which leads me to my question Garth, do you beleive condo developers take advantage of people this way, like – “keep building and they will come”. Especially in the low interest rate enviroment. I guess they still make huge profits so long as people are buying, its just the buyers who are hooped after the market turns and they can’t sell.

#87 Aussie Roy on 11.08.11 at 11:08 am

Aussie Update

Positive spin?, just more confidence is what’s required.

But that’s not the kind of confidence that’s being bandied about by an increasing number of banks just now. Wesptac CEO, Gail Kelly, told us on the weekend in no uncertain terms that because, as a group, we’re not borrowing as much as we used to because we lack confidence.

http://www.macrobusiness.com.au/2011/11/confidence-trick/

USA

Call it the Great Rock & Roll Real Estate Swindle. Call it a $26 billion Bait & Switch. Call it the Mother of All Boondoggles.

Call it whatever you want.

But as foreclosures surge again and house prices continue to slide, new data out Monday reveals more of the grim verdict on the $26 billion federal program in 2009 and 2010 to offer tax credits to home buyers.

You may remember that between the spring of 2009 and September 2010 the government handed out credits of up to $8,000 to induce people to buy a new home. It was supposed to gee up the housing market.

How’d that work out?

http://www.marketwatch.com/story/the-great-26-billion-real-estate-swindle-2011-11-08

#88 The thing in the basement on 11.08.11 at 11:10 am

Overall, the poser on the right exhibits superior mucularity and definition. Both display good symmetry and technique. Which one are you again Garth?

#89 GTA Girl on 11.08.11 at 11:10 am

Garth, love to know your thoughts on Carney’s speech this morning? The Keyser Sozye reference guarantees media hook. Have to think that was planned.

#90 Ret on 11.08.11 at 11:11 am

#71 Shanghai property crash.

The clip is listed as 2 minutes on You Tube but we see only 1 minute 41 seconds of video.

The last 19 seconds were not pretty. My wife saw this entire clip on TV the other night and tells me that there was some trashing of offices and other civil disobedience that we are not seeing in this clip. (Did anyone else see the whole clip?)

I guess that the Chinese spin doctors and the government are trying to keep this as low key as possible now that great Chinese property bubble/lie has been exposed.

#91 TaxHaven on 11.08.11 at 11:13 am

#77disciple, the trouble is that the governments of the world have not been able to resist the temptation to pull forward a lot more demand than can ever be met in future.

And government is the world’s worst allocator of capital, period. They needn’t worry about costs, profits or productivity. Ther only concern is to reward their client groups.

I assume your big beef, however, is that governments must borrow from private banks…

And I have no doubt your answer is to allow those same spendthrift governments to print their OWN paper “money”…

#92 pjwlk on 11.08.11 at 11:18 am

“The vendor technique of choice has been to list below ‘market’ value in order to ignite a bidding war, in which fair value is exceeded. Hence, greed. — Garth”

I think the same can be said for the recent auction you posted about.

#93 Ronaldo on 11.08.11 at 11:23 am

“I invest in anything that Bernanke can’t destroy, including gold, canned beans, bottled water and flashlight batteries.”
Fiscal Times, October 2010. David Stockman

Love this quote.

#94 wtf????? on 11.08.11 at 11:45 am

Figures don’t lie and liars can’t figure. When ‘Super Mark’ Carney announced another warning about liquidity his speech writers should have done their homework and told him that the real culprits in the liquidity game are governments competing woth each other to devalue their currencies faster than the other guy. Canada has increased the money supply 14% every year since 2000 to make the $C worth less than half what it was a decade ago….ergo massive inflation…..blamed on everything else than the governments own proclivity for blowing high dough and printing gobs to cover it up.

http://www.vancouversun.com/business/Carney+warns+wild+swings+global+liquidity/5674191/story.html

Now I’m no Garth Turner…he thinks I’m a bad man for speaking the hard truth without the liberal ‘smoke’. btw,,so don’t listen to me….But c’mon people…this flash cash printing disease is the death knell for your savings. The ‘Occupy’ dingbats have focused on the wrong enemy…or are they a front for government interests to misdirect the truth? I’m for the latter.

#95 Mingeford on 11.08.11 at 11:48 am

My ReMax Agent last month put her Brampton investment condo townhouse on the market because being a landlord is not for her. Comparables showed the last sale was for $228,000 so she told me her strategy was to list for $200,000 and accept offers on a certain day. Guess what happened?

She received only one offer for $208,000 felt insulted and rejected it, despite the fact she bought the unit last year for $184,000 and doesn’t incurr all the selling costs of having a realtor.

She has this week relisted it for $222,800 because in *January* a comparable unit sold for $233,000 !! I wished her good luck with selling it this time. I shall keep the Dawgs posted.

#96 Devil's Advocate on 11.08.11 at 11:49 am

Interesting…

Are We Becoming a Renter Nation?
There’s at least one big Wall Street bank that’s betting on the United States becoming a “rentership” society. Find out why Morgan Stanley believes some owners will revert to renting in the coming years.

read more…
http://tinyurl.com/5tclnx5

#97 Devil's Advocate on 11.08.11 at 11:53 am

And…

How to Profitably Serve Renters
Whether or not you think renters will become more
predominant in the market, you can make more money today by catering to them in an efficient yet personable way.

read more…
http://tinyurl.com/3m9kddf

YA BABY!!!

#98 Gord on 11.08.11 at 11:59 am

I can not believe that the media contiunes to allow reports from Remax and the real estae industry to be considered news items. They are biased and lead Canadians to believe that housing it the road to riches. I have just posted a blog article “Is your house your castle or your prison”. (http://www.timeandmoneyconnection.com/2011/11/is-your-house-your-castle-or-your.html)

In reality the average person can not afford to buy the average house, so no wonder that real estate industry is trying to paint a whole different picture.

Wake up people before you find the house you bought that was to be your castle turns into your prison.

Keep at it Garth, maybe someday your message will get through to the masses.

#99 Ronaldo on 11.08.11 at 12:03 pm

http://www.mj-economics.com/page/10/

I came across this link as I was reading my lastest copy of the Canadian MoneySaver magazine. This gal started a blog back in April of 2010 and has posted something like 44 posts which I read and find her to be extremely with it as far as the current situations going on at the moment around the world. She also has initials behind her name, BEcom, MPA which helps. I think Garth you may find some of her posts quite interesting as her take on some things are very close to yours.

Moneta, I think you would like this blog.

#100 Form Man on 11.08.11 at 12:05 pm

#66 yokel

I will tell you what the Harper has done. He has lowered lending standards via CMHC, creating a subprime mess. He has ramped up spending faster than any government in history. He has cut the GST, to the dismay of economists, because value added taxes are considered the most efficient taxes, leaving income taxes as the proportionately higher revenue source. I could go on and on……..

#196 Devil’s Advocate on 11.07.11 @ 10:20 PM
You have missed a lot of things my friend, leading me to believe you cannot comprehend what others are writing. Go back carefully through all my previous posts; you will find I am scrupulously accurate about my facts and evidence ( unlike yourself ). I am in the same city as you, and in a related business. Thus I feel compelled to expose your ranting nonsense. If you are relying on your gut rather than the evidence surrounding you, you have my condolences. You will find life a hard road.
good post Garth.

#101 maxx on 11.08.11 at 12:19 pm

#48 City Slicker on 11.08.11 at 2:00 am

As more SHTF, MSM pumpers will become increasingly effete and streets will be flowing with the RE industry’s bile.
RE newspeak will centre on “realistic”pricing and hordes of price intransigents will be pliable as butter.

#102 html on 11.08.11 at 12:19 pm

hey garth you need to close the italics tag on post 71

#103 Ronaldo on 11.08.11 at 12:22 pm

#51 Betamax – “I know several boomers who are living it up on borrowed money. Prices go back to ’03, they’ll be greeting folks at Walmart till they die.”

There will not be enough Walmart greeter positions available.

#104 disciple on 11.08.11 at 12:26 pm

Scientific Dictatorship. Here is an interesting list of sacrificial victims of the military-industrial-complex. The more knowledgeable you are, the more expendable you are. The story of Hamlet, in a nutshell…

http://www.stevequayle.com/dead_scientists/UpdatedDeadScientists.html

#105 You are the fool on 11.08.11 at 12:29 pm

Hey Garth you have been predicting a RE correction since God knows when. What I do not understand is the fact that how can so many people read your carp every day and stay on the side hoping they will be able to buy a house one day.
You know RE might go down some time in future and it might go down 10-20%, but GTA prices have increased almost the same amount in 2011 so waiting on the side lines hoping to buy a million dollar home for 200k is never going to happen.
Garth stop being so negative, if all hell is breaking lose instead of promoting bank stocks you should tell everyone to short whatever they can get their hands on.

So buy a house. Be sure to return in a year and give us a report. — Garth

#106 maxx on 11.08.11 at 12:32 pm

#54 Jane24 on 11.08.11 at 3:32 am

Completely agree- pretty difficult to invoke the “who knew?” exclamation if values go horribly wrong after years of pumping it up, eh what?!!

#107 Van guy waiting on 11.08.11 at 12:41 pm

Taipan,

Are you still building down under? It’s funny how a developer says that people are dumb to buy. Do you post signs at your sales office stating that people are dumb to buy?

#108 Ronaldo on 11.08.11 at 12:41 pm

#98 Gord – “In reality the average person can not afford to buy the average house, so no wonder that real estate industry is trying to paint a whole different picture.

Wake up people before you find the house you bought that was to be your castle turns into your prison.”

Actually Gord, with the size of condos now being proposed (under 300 s.f.), developers will be pumping these things as the next “in thing” like they did in California.

Heck, when these 300 square footers which become too expensive for the speckers, what they could do next is buy up some of the old jails around the country and turn the cells into even smaller condo units.

Isn’t Harper planning on building more jails? Would be an opportunity for him to sell off the old ones and build newer more modern ones fully equiped with all the latest technologies so that the inmates would be more comfortable.

They could come up with a fancy name for them like “Alcatraz Acres” or some such thing. As good a name as some I read about that they are calling “Gotham”. In Winnipeg I think. Just an idea.

#109 Quebec_Frog on 11.08.11 at 12:59 pm

Finally an interesting article on this blog ;o) Nice written Garth. Average price on a house here in Montreal is approx 350 000$. Last month I asked a realtor if the price will top or even decline, he replied: No, the housing price will continue to rise like it ever did’. Anyway, this year I bought a house at 285 000$ with a bachelor and I plan to live there for a very very long time, I know the bubble can burst at anytime but I made the choice to buy because I could not wait forever this housing bubble to burst. Sorry for my pathetic english grammar, I’m french and I skipped most of my english course at school.

#110 HDJ on 11.08.11 at 1:09 pm

The real estate numbers are obviously correct – house and condo prices more than doubled in the last ten years. And anyone who got out of the market during that time and rented, in anticipation of a drop, made a bad decision – it was far too early to bail out. As a consequence, this decision produced significant loses that will not be recouped unless the oncoming correction is a very large one. I’ve no idea what the magnitude of the downturn will be, but it probably won’t be sufficient to serve the needs of those who sold off properties that ultimately doubled or tripled in value.

#111 disciple on 11.08.11 at 1:18 pm

Beware the Peak Oil agenda:

Note that the oil reserves claimed by Saudi Arabia alone (1.2 trillion barrels) exceed what the Peakers claim are the total recoverable oil reserves for the entire planet. Let’s pause here for a minute and think about the significance of that: one tiny patch of land, accounting for less than than 1/2 of 1% of the earth’s total surface area, potentially contains more oil that the ‘Peak’ pitchmen claim the entire planet has to offer! Is there not something clearly wrong with this picture?

http://www.davesweb.cnchost.com/nwsltr70.html

#112 wetcoaster on 11.08.11 at 1:27 pm

Carney saying we’re on the cusp of another credit crisis and the Canadian media are pumping houses like snake oil salesmen. Even the Victoria TC rag has the same article on the front page 24 hours later when most articles are routinely dumped within 12 hours or less. You can bet your ass that ReMax pumped out millions of advertising dollars to keep this story front page for days.

#113 rana on 11.08.11 at 1:39 pm

Great post Garth.

You hit the nail on the head with this one.
Its a difficult pill to swallow when you start telling people that their homes will be worth much less than what they paid for and will only be making higher payments then they ever intended to on a home that is worth less.
People do get blinded by shiny, new and big and by others making money in this market- and everyone wants a piece of the action but are unsure how to do it.
A friend of mine who earns less than I do (which is not much) owns three condos in Lower Mainland- hoping she would strike it big with the increasing real estate market. SHe now finds herself in debt, her “assests” depreciating and has no idea what to do. So she does what most women do- shacked up with a guy who has money and is leaching off him. She does not pay for any rent or expenses. She spends all her money trying to pay off the three morgages. She thinks if she hangs on a little more she will be in the clear- I told her to sell and cut her losses- as they are not so bad this time. But her ego gets in the way- no no, she says value will increase in her condos.

I am not sure why people thinks is bad advice to put down at least 25% down on a morgage, to spend less than a third (although I think less) of your income on morgage payments, to have as little as debt as possible, to work hard and save, to do some bloody research and thinking before just jumping into carrying a half million dollor debt.

#114 Beach Girl on 11.08.11 at 1:43 pm

I will be probably rejected from this site today. But I think Paul Bernardo has more living space.

Everyone I know is down in the dumps. This does not seem to end.

I made 20K in the late 70s, I thought I was broke. I could buy a house in Pickering for 60K. What has happened.

Might be the weather, yesterday was great.

#115 Beach Girl on 11.08.11 at 1:43 pm

Stop with the italics.

Blame the Apocalypse 2010 doomer dude. Now fixed. — Garth

#116 jess on 11.08.11 at 1:51 pm

A homebuyer is upset over being hit with $50,000 worth of unexpected repairs to his basement, after the seller and his realtor didn’t tell him about previous water leakage problems. cbc

disclosure
who knew … insurance opting out since mold law suits are costly for the insurance . 35 states, including New York, have successfully lobbied insurance regulators to permit insurers to exclude mold coverage in their policies.

Stevens v. Pirate’s Lane Condominium Trust, et al) was rendered in Massachusetts .

=========
Remember rent a wreak …only this time you buy one cause your ,poor , need to get to work and your credit sucks. No problem we have the car for you! Price of these wrecks are 3x kelly blue book with 21% interest. The default rate is 4 :1
Investors place big bets on Buy Here Pay Here used-car dealers
November 1, 2011
http://www.bhphinfo.com/

========

The Prompt Corrective Action Law – Section 1831o.

Prompt Corrective Action is a US federal law mandating progressive penalties against banks that exhibit progressively deteriorating capital ratios. At the lower extreme, a critically undercapitalized Federal Deposit Insurance Corporation (FDIC)-regulated institution (i.e., one with a ratio of total capital / assets below 2%) is required to be taken into receivership by the FDIC in order to minimize long-term losses to the FDIC.[1] The motivation behind the law is to provide incentives for banks to address problems while they are still small enough to be manageable.

#117 And in Calgary on 11.08.11 at 2:00 pm

Jay Cutler in that picture.. I met him 8 years ago in a supplement store in Brantford, ON… another place where real estate prices have doubled in the last 10 years..

#118 jess on 11.08.11 at 2:02 pm

The Story of Broke (2011)
http://www.youtube.com/watch?v=G49q6uPcwY8&feature=player_embedded#!

#119 TaxHaven on 11.08.11 at 2:04 pm

#93 Ronaldo…one of my own favourite quotes too!

And I submit, that even for those of us who are not “doomers,” it’s prudent to follow it. Just beware “the gold bubble”….! Hahahahah…!

#120 oslec on 11.08.11 at 2:12 pm

#75 Diana “Speak for yourself my friend. They can detail my Harley anytime.”

My wife’s name is Harley. Don’t give her any ideas…

#121 Devil's Advocate on 11.08.11 at 2:31 pm

#100Form Man on 11.08.11 at 12:05 pm

#196 Devil’s Advocate on 11.07.11 @ 10:20 PM
You have missed a lot of things my friend, leading me to believe you cannot comprehend what others are writing. Go back carefully through all my previous posts; you will find I am scrupulously accurate about my facts and evidence ( unlike yourself ). I am in the same city as you, and in a related business. Thus I feel compelled to expose your ranting nonsense. If you are relying on your gut rather than the evidence surrounding you, you have my condolences. You will find life a hard road.

Form Man;

I have plenty of facts and figures at my disposal. You know what they say about statistics… right? So while I certainly do spend time gathering those facts and figures I pepper them heavily with a gut instinct which comes from many years of experience and education.

Look… you have failed to be able to compete in this market and I have over thirty years worth of successfully surviving through the worst it could throw at me. THAT my friend should tell you everything you need to know about the difference between you and I.

Don’t feel too hurt as you leave town though Form Man. This city has chewed up and spit out much better than you.

Good-bye

#122 zeeman1 on 11.08.11 at 2:44 pm

# 81 disciple.

Cutting public service fat is necessary as it’s the biggest drag on our governments because of years of money printing and good time economic fake negotiations with the government unions. I think I pay enough taxes, thank you. Call of Duty is clearly military indoctrination (these games and movies are made with plenty of help from the military) but US culture has always been big on this and the US military has always been the biggest welfare program in the world. I prefer playing Halo because I’m saving humanity from evil aliens, not evil illegal aliens.

#123 Nostradamus Le Mad Vlad on 11.08.11 at 3:03 pm

#77 disciple — “Entire nations on this planet operate without the need for interest. These are the ones being targeted by the international banking cabal.”

Correct. See link “Three Countries” in #41 post. This gives a clear reason why Libya was destroyed, and Iran is next.

It shows who is manipulating and controlling events in the world, except for one thing — They do not know, or realize there are superior and higher forces working beyond their ideals.

#82 Daisy Mae — “. . . . the global financial disaster, . . .” — See response to #77 disciple. You are both on the right track, the only thing left being the unseen element. This appears in due course.

#90 Ret — “(Did anyone else see the whole clip?)” — Yes, but I didn’t bother posting. All part and parcel of the current cycle change. Not too long to go now.

#111 wetcoaster — “Carney saying we’re on the cusp of another credit crisis . . .” — On cue and enter stage left. Guess what the realization will be a few weeks after xmas / new year’s?
*
‘Quakes ‘n’ Things for 2011. These are part of the happenings the higher forces are using to bring change.

#124 zeeman1 on 11.08.11 at 3:10 pm

# 111 Disciple.

The peak oil doomers are just the latest in a long list of resource doom preachers who have been proven wrong every time throughout history. Doesn’t stop them from trying to spread the word, though. Also ,they fail to take into account all the known, non exploited oil reserves that are in remote or protected locations. Self imposed blindness on their part.

#125 refinow on 11.08.11 at 3:16 pm

This is Remax’s last trump card, and they already lost the first two tricks….. About to get euchured!!

They are running out of positive trend comparibles so they are going way back in time to show positive figures, 11 years prior….

Dont worry that if you buy a house today….Look at all the money everybody made when they bought real estate…before…..They just mixed a fresh batch of Kool-Aid….

#126 Marc L on 11.08.11 at 3:30 pm

Wall Street Bonuses Set to Plunge…

http://money.cnn.com/2011/11/08/news/economy/wall_street_bonus/index.htm?hpt=hp_t2

#127 Snowboid on 11.08.11 at 3:32 pm

#96,97 Lucifers’ Apostle…

Your links show why a rental property will provide an investor in the US positive cash flow – unlike most places in Canada.

If you compare two equivalent properties, SFH in managed community in Kelowna vs one in Phoenix – each with 20% DP and 4% interest on 25 year mortgage.

Rent in Kelowna $ 1800 a month, Phoenix $ 1000.

Net income (loss) in Kelowna monthly $ – 828
Net income in Phoenix monthly $ +208

Basically you have reinforced our reasons for renting in Canada

Thanks

#128 The American on 11.08.11 at 3:32 pm

19th BPOE, THIS JUST IN!!! Again, you’re wrong :-) Damn, this is so embarrassing for you!

Wall Street Journal:
http://online.wsj.com/article/SB10001424052970204554204577023123449783572.html

Forbes:
http://www.forbes.com/sites/gordonchang/2011/11/06/property-prices-collapse-in-china-is-this-a-crash/

Say good bye to all those buyers in Vancouver with that HAM. This will have, without question or doubt, deeply negative impact on property values in Vancouver.

#129 CTO on 11.08.11 at 3:37 pm

#86 City Slicker

guess they still make huge profits so long as people are buying, its just the buyers who are hooped after the market turns and they can’t sell.

VERY SIMPLE QUESTION…
If there is so much $ return for being a landlord, then why don’t the developers keep the buildings they build and rent them out as luxury appartments?…like they did a few decades ago.

ANSWER: RISK MANAGEMENT!

#130 Snowboid on 11.08.11 at 3:41 pm

#121 – Lucifers’ Apostle

I have no idea who Form Man is, but if you think you are in his league (intelligence, etc) I am sorry to say you are incorrect.

Form Man just continues to kick sand in your face, may I suggest the Charles Atlas program?

At least that will take your mind off the coming RE downturn in the Okanagan – at best you may end up in a picture from one of Prof Turners’ blog entries!

#131 VI Funcanuck on 11.08.11 at 3:55 pm

AT RISK OF BLAMING THE VICTIM…. “GREED” is greed and an ongoing pervasive theme. Heard about investment scams where a sucker invests their cash, takes a mortgage thinking Return on Investment (ROI) of 20%+ annually is NORMAL. Lo and behold a pyramid scam. Crazy greedy and stupid. Some people need a reality check.

Victoria Still Overpriced:

Am in Victoria on business this week and RE is still overpriced and I doubt much condo stock’s moving. Glad I don’t live here anymore (can you say colwood crawl?)!

Just another viewpoint.

#132 poco on 11.08.11 at 4:01 pm

#196 DA–from yesterday
I don’t think I understand what you mean by sales to listings ratios as you appear to have used it out of its industry context. Maybe you don’t understand it? If you mean months of inventory well that can be quite a misnomer.
______________________________________________
“out of its industry context”—-boy you really do have to get out more
sales/listings–or, as you like— sales/ inventory (as used in the Okanagan)–same meaning to us westcoasters—
you couldn’t figure that out????
as i sit hear and read my latest remax flyer from the cute newbie realtor which states “sales to listings”–isn’t she in the same industry???

#133 Kevin in Winnipeg on 11.08.11 at 4:03 pm

http://news.nationalpost.com/2011/11/08/canadian-home-prices-have-doubled-in-the-last-decade-study/

– Winnipeg a future real estate hotspot: study

A developer must be trying to drum up buyers for projects. I wish I could use the media to get free advertising as well.

#134 Onthesidelines on 11.08.11 at 4:06 pm

Excellent post, Garth.

#135 Form Man on 11.08.11 at 4:33 pm

#121 Devil’s Advocate

My goodness ! you are touchy today. some tips for you if you want to earn the respect of the other bloggers:

focus on trying to deconstruct your opponent’s arguments, rather than on wildly inaccurate personal attacks. By ignoring the facts presented, you simply confirm either a comprehension issue, or lack of a valid counter argument.

#136 Van guy waiting on 11.08.11 at 4:40 pm

The Rolston development in downtown Vancouver is now clearing out remaining units at a 10% discount. The other fools will have to follow. Condos are toast in GVRD

#137 Alex B on 11.08.11 at 4:52 pm

My pretty Realtor friend on facebook posted this link to help persuade people to lay down 400k for a rathole. http://cordelia.opendoormortgages.ca/news/2011/11/heres-why-house-prices-seem-so-high I mean, who doesn’t trust ReMax?

Great last paragraph or two big Guy, really focused and great writing!

#138 BPOE on 11.08.11 at 5:05 pm

American how desperate you have become. Some Real Estate 101 for you . Nothing goes straight up or straight down. Vancouver is about the long term it is not a starbucks flavour of the month
Boy sure are huge decreases in China. What was it – oh yeah .23% POINT 23 %. Even if prices were to drop 5 or 10% over a couple of years, investors have made out like bandits. Your posts continue to show your arrogance and ignorance when it comes to Vancouver. The fact of the matter is you’re just plain jealous. It’s not anyones fault than your own that you can’t afford to live here and missed the boat on paradise
********************************************
The American on 11.08.11 at 3:32 pm
19th BPOE, THIS JUST IN!!! Again, you’re wrong :-) Damn, this is so embarrassing for you!

Wall Street Journal:
http://online.wsj.com/article/SB10001424052970204554204577023123449783572.html

Forbes:
http://www.forbes.com/sites/gordonchang/2011/11/06/property-prices-collapse-in-china-is-this-a-crash/

Say good bye to all those buyers in Vancouver with that HAM. This will have, without question or doubt, deeply negative impact on property values in Vancouver

#139 Peakoilist on 11.08.11 at 5:16 pm

#111 disciple

why don’t read a more reputable source for Saudi oil reserves, like this gem by Matthew Simmons, the foremost authority of peak oil..but somehow you would still prefer to believe crackpot sources from 2004. Is that your only source for debunking peak oil? Despite what you may believe in that little world of yours, you don’t know everything about everything..that’s just a little creepy. every time you come on here and spew that garbage , I will jump on you my friend…..

http://www.amazon.ca/Twilight-Desert-Coming-Saudi-Economy/dp/047173876X

#140 The Corporate Media on 11.08.11 at 5:18 pm

You are so right, Garth!

We now have less than 1% independent media in Canada–the most centralized in the world.

In 1990, it was 40%.

Even the Canadian Press is now corporate owned…happened less than a year ago.

Sad.

And dangerous.

#141 Peakoilist on 11.08.11 at 5:33 pm

#124 zeeman1
please see my response to Disciple above. Peak oil is not doomerism. It is based on data that is published. those oil reserves that you speak about are expensive to produce(and much smaller volume. a few billion barrels, that would last the US, with their consumption, a few months. People love to debunk peak oil because they haven’t done their research. It doesn’t mean that the world is running out of oil. It means that the lowest hanging fruit has been picked and that the remaining reserves are less conventional and therefore more expensive. The Saudi’s are suspected of fudging their reserve numbers as to not raise the alarm bells, that their oil is not flowing as smoothly and is more difficult to extract. It is more and more sour and heavy. ala Venezualen crude. The world is stuck at 86 million barrels per day, since 2008,but due to the economy sinking the last few years , the effects of peak oil have not been fully felt.
but somehow I suspect that the peak oil disbelievers, will still prefer to use conspiricies to explain plain and simple resource depletion.

#142 April Showers on 11.08.11 at 5:41 pm

This is hilarious! BPOE JUST GOT HIS ASS HANDED TO HIM BY THE AMERICAN AGAIN! BPOE has to be the dumbest person on any blog I’ve ever read. The only arrogance and ignorance I see in this blog is BPOE.

Great videos UK Love Calling!!!! SEND MORE because it is fun and entertaining and I totally see your point.

#143 live within your means on 11.08.11 at 5:45 pm

Neighbour’s son sold their home. Closing is Dec. 1. Before his Father died 7 days ago, he & his wife told them they could stay with them until they found a home to fit their needs and within their price range. They don’t want him to feel pressured into buying something above their means. They’re not looking for SS or granite counters.

House behind us has been on the market for at least 6 mos. and has been empty for at least 5 mos. For sale sign has now been removed.

Meanwhile a friend of ours recently put up her place. Its a townhouse overlooking a park. She’s had 4 showings but no sale as yet. A house up the street – listed at the same time as hers sold over the weekend. Her home is listed until Nov.28th. If it doesn’t sell before then, she’ll wait until the spring to relist it. She’s not in a hurry. No mortgage. She’s a retired school VP, her own consultancy business, and will make money on her place, regardless. She’ll rent and travel. Good for her. She went through hell with her ex.

Weather was beautiful here today – 15+ – a real Indian summer and should be nice until Friday then clear up Sat.

#144 bigrider on 11.08.11 at 5:49 pm

Thats it. Im gonna Martyr myself. F-in sick of this senseless RE mania.

I’m gonna buy a condo in the T.O proper and a cheapo house in the suburbs, both as ‘investment properties’

Gauranteed now that market will f-in tank.

Garth ,I expect a cheque in the mail from you upon closing for half my losses.

Gonna make you look like a genius oh bearded sage… worth a few bucks too you I think.

#145 bcpaul on 11.08.11 at 5:51 pm

Looked at MLS yesterday. I am astounded by the sheer number of Court Ordered Sales and homes that are empty save a mattress and and few odd and ends.

#146 Mike on 11.08.11 at 5:59 pm

You mean a politician who promises something to get elected then within a year says he cannot deliver. I have never….. gasp… The guy was a clown for the past 4 years and the circus has not closed down yet…. The farmers are reeling from the removal of the Wheat Board. The dismantling of the long gun registry. All those who voted for these clowns have no one to blame but themselves. Maybe the same morons who post here that they were the first to be on the blog… what a waste of human organs.
As for real estate .. go to guava.ca and see how inventory has dropped and prices just keep going up..highest median prices … shortest number of days on the market. This may take some time for this to reverse or even abate…. why ?? LOW interest rates that seem to be going nowhere soon plus there is talk that rates will go DOWN not UP… Greed from realtors. These guys can clear 10K in one house deal for a few days worth of work…. Global economy sucks and will continue to suck for some time… Limited employment does not seem to bother the market as people are not adverse to debt… The stock market does not offer the stability as real estate. Talk to the REIT guys.. They often have 5 plus year leases so they have a base of predictable income …. same applies to residential ownership.
Prices are way ahead of peoples wallets but the system is just rigged to go up… stay tuned for a brisk winter selling season.

#147 AKatz-Oaville on 11.08.11 at 6:01 pm

2 reports about housing affordability in Halton Region:
http://www.cdhalton.ca/pdf/Report-Card-on-Poverty-Oakville-Families.pdf
http://cdhalton.ca/pdf/communitylens/Community_Lens_71.pdf

#148 Maxamillion on 11.08.11 at 6:07 pm

Has the asteroid hit yet? Maybe it will knock some sense into this planet. Hiding in the bunker with no lights.

#149 Timing is Everything on 11.08.11 at 6:09 pm

#114 Beach Girl- “Might be the weather…”

Once your problem has a name, it’s not your problem anymore. SAD…?

http://tinyurl.com/4eo98fz

#150 Devil's Advocate on 11.08.11 at 6:09 pm

Form Man, Snowboid & Poco

Be it mortgaged, rented or owned, even here in the sunny Okanagan, EVERYBODY needs a roof over their head.

Being in the business I am, I’m not so worried. Nor am I wasting time hoping for something that may never come or escaping that which I cannot change. I deal with what is and there is plenty of it to keep me busy.

You keep interpreting the stats as you wish selecting those which have been presented in a manner that suits you best. Reject mine because they never will tell you what you want to hear. Only time will tell who was right and who was wrong, who was the fool and who was not.

A hint though my friends, be you right or wrong it is all fine by me for be it rented, mortgaged or owned you still need a roof over your head.

#151 zeeman1 on 11.08.11 at 6:22 pm

# 141 Peakoilist.

The OPEC producers have capped their production to keep prices high during a global slowdown which has lessened the need for their product despite all the emerging economies and growing middle class. They have stated their desire to keep oil between $80 -$120/barrel. Production in Canada’s oil sands is steadily increasing and many countries are sitting on massive untapped oil and Shale Gas reserves. You’re a doomer and you guys have all been wrong so far.

#152 Hashnugs Inthebong on 11.08.11 at 6:22 pm

Hi Garth, If I was to buy a Langley area townhouse in the 300K range, and offered 275K and the owner was “insulted” by the offer, what would be a good insult to return with another offer? I was thinking of telling the owner that from the pictures I saw on the wall, the skirts in his wifes closet are much to small for her size. Anyhelp with countering insults would be appreciated.

Go away for a month than make the same offer. — Garth

#153 mac on 11.08.11 at 6:27 pm

DELETED

#154 Humpty Dumpty on 11.08.11 at 6:46 pm

http://www.reuters.com/article/2011/11/08/us-eurozone-idUSTRE7A72R320111108

“I” of the storm, or just “I” in the PIGGS.

Stay tuned!
Much more muscle will be requried. However….

This is real italian muscle….

Or just another episode of ” The Italian Job”

http://www.telegraph.co.uk/finance/financialcrisis/8856149/Italian-government-buys-19-Maserati-supercars-despite-austerity-cuts.html

#155 BPOE on 11.08.11 at 6:46 pm

Still renting eh April Showers. With a name like that you must be a Seattlelite
*******************************************
#142 April Showers on 11.08.11 at 5:41 pm
This is hilarious! BPOE JUST GOT HIS ASS HANDED TO HIM BY THE AMERICAN AGAIN! BPOE has to be the dumbest person on any blog I’ve ever read. The only arrogance and ignorance I see in this blog is BPOE.

Great videos UK Love Calling!!!! SEND MORE because it is fun and entertaining and I totally see your point.
.

#156 Steven Rowlandson on 11.08.11 at 6:48 pm

Ultimately having a surplus or deficit is an act of will and is no accident. If Canada’s governments were really serious about being fiscally conservative they would decide that the communist spending spree is over and the books are going to show surpluses all the time untill the debt is paid off no matter how many politically correct canadians, businesses and special interests have to be short changed or cut off all together.
There is no gain with out pain! You want Canada to be another USA, Argentina, Zimbabwe, Yugoslavia or Weimar Germany? Keep resisting austerity and keep supporting your favorite politicians. They will borrow and print to keep things going untill your life savings and pay check is worth nothing. If panic or default doesn’t do you in hyper inflation will.
All done with your consent at the ballot box of course.

Always entertaining to hear from the Tea Party. — Garth

#157 Van guy waiting on 11.08.11 at 6:58 pm

BPOE & DA

How many condo pre-sales do you own?

#158 cxcroney on 11.08.11 at 7:08 pm

Garth, is the picture Cain and Romney?

#159 Form Man on 11.08.11 at 7:12 pm

#150 Devil’s Advocate

That is actually a very good post.

#160 Devil's Advocate on 11.08.11 at 7:33 pm

#157Van guy waiting on 11.08.11 at 6:58 pm
BPOE & DA

How many condo pre-sales do you own?

None.

I cannot speak for BPOE but I do not care to own strata properties of any kind. The value is not in the improvements upon the land but the land itself.

I am self-admitted slum-lord. I do not care so much what the tenants do to the building. It is the land I buy. When they move out we will clean up the mess they leave and rent to another. Pets allowed as they tend to respect the place better than their owners.

#161 Devil's Advocate on 11.08.11 at 7:36 pm

Funny thing about pet owners… when they find a rental that will allow pets they are most willing to pay way more than they should for the privilege of having pets. They will actually compete with one another bidding a higher rent to secure it.

#162 Devil's Advocate on 11.08.11 at 7:45 pm

Nothing like obnoxious, loud, renters and their pets to drive down the price of the neighbouring properties you might want to consolidate. ;-)

#163 Nostradamus Le Mad Vlad on 11.08.11 at 7:55 pm


11:37 clip Iceland’s real revolt; Dallas and Oakland Two cities that are having general strikes; 3:34 clip Euro is a Greek word; Greece “European Central Bank Vice President Lucas Papademos is ready to take on the job.” They’re all cozying up to each other to ward of the inevitable (“Bow down before the IMF, ye slaves of Greece!” wrh.com), and Berlusconi is almost gone, and TPTB have another austerity package in place; Admit One Covering up fraud from the ’80s; US$518 bln. And that’s my bi-weekly paycheque! 8:01 clip No one can say for sure when a revolution explodes into action.

1:10 clip Sarkozy, Obummer, Harper and Netenyahu — they are all liars; 43 bln. pounds lost in investments due to inflation; Twelve facts about money and congress; Deutsche Bank Is everyone ready for another crisis? Something that no one can control, except TPTB, as they are the ones pulling the strings? Plus The 11th Marble Goes with Deutsche Bank link; Gold, Ron Paul and Central Banks “Ron Paul recently said that he would choose Jim Grant as Fed Chairman if he were President – This short video explains why.”; 9:01 clip US economy deliberately allowed to fail? 3:19 clip Neanderthal Bill O’Reilly disqualifies Ron Paul from list; 4:12 clip Just as the IMF took Libya’s gold, so Obanana is going to take citizens’ gold in roughly the same way; Best Buy closes UK stores; OWS says Americans should occupy foreclosed homes; 2:46 clip Rural farmers band together to feed OWS protestors.
*
Dictatorship The US has two new tracking devices; Robots Google replacing humans? 7:27 clip US military is trafficking heroin from Af’stan; Warmongers Beating the war drums again, and 9-11 to WW3 The dots have almost been connected (not incl. FFs); The US and Russia. Neither has the funding for such projects, unless they increase the speed of their presses.

5:01 clip Iran has no bomb (duh), and 1:53 clip Ground invasion of Iran makes Iraq look like a picnic; Odd Space weather is down, just as the hemmorhoid steroid passes gas on its fly-by; Odammit No more need be said for the person he is; Flu – Cold Remedy Lotsa rest plus oranges.

#164 Van guy waiting on 11.08.11 at 8:01 pm

#152 Hashnugs Inthebong

Maybe they were insulted because you eyes were red and you were more interested in the pantry and fridge.

#165 Devore on 11.08.11 at 8:34 pm

#152 Hashnugs Inthebong

If I was to buy a Langley area townhouse in the 300K range, and offered 275K and the owner was “insulted” by the offer, what would be a good insult to return with another offer?

Tell him you’re insulted by his high asking price. WTF should you be tiptoeing around fragile egos?

The key to getting a good real estate deal is patience. I know, I know, real estate “professionals” will say you need to act quickly to get the best deal, but that’s only because they work on commission, and saving you 10, 20, $50k is not very high on their priority list.

#166 McLovin on 11.08.11 at 8:46 pm

DA, WOW. I am actually disappointed in you.

Perhaps you should adopt the 15 min cool down method. Write your post, go away and come back in 15 mins. If you still mean it then hit “submit”

#167 Steelman on 11.08.11 at 8:52 pm

The people who got us here, are still in power and
continue to pull the wool over everyones eyes….good story see the moive or read about it … INSIDE JOB.

herehttp://en.wikipedia.org/wiki/Inside_Job_(film)

#168 April Showers on 11.08.11 at 8:53 pm

BPOE my name is April you retard. And I like the rain. IT RAINS MORE HERE IN VANCOUVER THAN IN SEATTLE. YOU ARE SO FRIGGIN’ S T U P I D! Everyone knows Vancouver’s weather is the best in Canada but Vancouver’s weather is definitely worse than the weather they get in Seattle.

Seattle receives only 944 mm of rain a year and 21 cm of snow
Vancouver receives 1199 mm of rain a year and 48 cm of snow

So Vancouver receives 27% more rain than Seattle and Vancouver 128% more snow than Seattle.

http://en.wikipedia.org/wiki/Seattle
http://en.wikipedia.org/wiki/Vancouver

#169 Devil's Advocate on 11.08.11 at 9:44 pm

#166McLovin on 11.08.11 at 8:46 pm

What? The Slum-Lord thing? I am only filling a need others will not. As my reward the supply/demand dynamics compel my customers to reward me handsomely. If you are a renter with a pet you know how few options you have. If you don’t like it get rid of the pet and rent a nice new, never lived in condo with granite, stainless and hardwood from some reluctant landlord. I hear there are many to choose from that can be had cheap.

Otherwise buck up and buy a house.

#170 Bobby on 11.08.11 at 9:46 pm

For #152 Hashnugs,

Garth is right, walk away and wait. But if it was me I’d offer even less, say 270k.
Remember a property is only worth what someone is willing to pay.

#171 Bobby on 11.08.11 at 9:50 pm

Just read the article in the local TC today about real estate prices doubling in a decade. The naive will say it is a 100% rate of return but in reality it is only about 7% a year.
I have some dividend funds that have averaged 9%.

#172 Peakoilist on 11.08.11 at 9:55 pm

#151 zeeman1
your response proves that you’re an idiot.
OPEC needs to cap production at that level, because it is getting so expensive to get out of the ground now. They need to keep the price at least above $80 to make it worthwhile. Also their domestic consumption is rising rapidly which will decrease the volume that they will export as they are passing their own peak. The most the oil sands will ever produce is 3 mbd..much less than an oil thirsty world needs,as production will inexorably decline over the next decade. Shale oil is in the same boat… EROI is getting close to 1.5:1 now(http://www.westernresourceadvocates.org/land/oseroi.php), way too close to breaking even with oil prices where they are right now. Oil pricing heading above $100 will create more profit for OPEC and oil and shale oil producers, but there is still limits to what they can produce ..it is a slow process, due to its unconventional nature..
I suggest that you do a lot of additional reading on this subject, not just grabbing headlines from the MSM. “O look we have billions of barrels of shale oil, just waiting to be extracted too slowly at too high a price to make it worth the while” It’s a huge energy sink. http://en.wikipedia.org/wiki/Second_law_of_thermodynamics

#173 Snowboid on 11.08.11 at 10:01 pm

I thought about calling the super realtor of Kelowna on his many blunders since he started posting about real estate over 3 years ago (how he was leaving Kelowna
and had sold his rental properties and had liquidated assets, etc. etc.) but I couldn’t say it any better than poster ‘Chris’ from about a year ago:

“ How to be just like the Devil’s Advocate,

1. Begin by writing to Garth about how the world is insane, there is no point to Garth educating people, blabber a lot and basically act like an ass. (1 week ago)

2. Follow it up over the next several days with some rather well structured and well thought out posts, that come as a result of it being pointed out he is once again behaving foolishly.

3. Increase the velocity of these posts.

4. Begin to try and take over the direction of the blog by challenging Garth over his strongly held beliefs.

5. When Garth doesn’t take the bait, get angry.

6. Call people names like…asshole. (Yesterday)

7. Then have Garth respond with “Your arguments were more cogent before you became abusive. — Garth”

8. State that “Truth prevails always and can not be manipulated to say anything other than what it is.”

9. Once kindly reprimanded by Garth, revert to the fetal position with “But Garth, come on now, even in that post of mine you just censured you must have sensed the love bro? You know I respect you. And what would this blog be without a Devil’s Advocate. Come on now were good… right?”

10. Completely try to ignore the fact that your poor behaviour is a regular problem that you claim to be willing to clean up, but never do.

11. Talk about integrity.

12. Ignore the fact that you made a public statement of accountability several months ago that you asked people to hold you to.

13. Break your promises.

14. Look like an hypocrite.

15. Repeat the process over many months.

Follow these 15 steps if you want to become as unstable as the Devil’s Advocate.

P.S. – Remember what DA said – “Truth prevails always and can not be manipulated to say anything other than what it is.”

You will be a man of integrity just like him…and very self aware too”

#174 Don on 11.09.11 at 3:00 am

#23 Calgary Bubble:

The media bit: Well said!

An historical low in terms of factual/investigative reporting.

#175 disciple on 11.09.11 at 10:09 am

#122 zeeman1… You make a good point, but I think that the drag on the economy is the compound interest on the unfunded liabilities, and not the principal itself, which can be obtained from taxes… the interest never can, because it does not exist… and never will…

#176 disciple on 11.09.11 at 10:47 am

Peaky… I was waiting for you to weigh in. Just checking to see if you were still alive… Good point about the 2004 source, I was aware of the dated material, but valid logic never goes out of style does it? I am a peak oil disbeliever still, but I am hearkening intently to your comments, perhaps you can sway me, after all, it seems logical that eventually oil will be depleted, even if it does self-replenish somehow way down in the Earth’s mantle. But people have been declaring peak oil since the turn of the century, you have to admit that. It all comes down to which conspiracy you prefer to believe in.

Having said that, here are some things we agree on:

-Price manipulation
-Published numbers are bogus
-Oil obsession is one pretext for military action
-Current usage levels are unsustainable
-There are hidden agendas on both sides of the Peak Oil Theory

So, let’s look at those agendas: Peak Oil proponents are concentrated among the Big Oil players. They JUSTIFY their wars of aggression AND their price manipulation based on this MYTH OF SCARCITY. Do you see the pattern? They’re not making any more land, they’re not making any more oil. Shall we include Peak Gold now? How about Peak Water? We’re always running out of something, aren’t we?

Peak Oil opponents are ALSO concentrated among the Big Oil players. “There’s no problem here, nothing to see, people, let’s continue to gorge ourselves”…

But how can this be? Is that even possible? YES! The Hegelian Dialectic at work again. Mind control.