Don’t. Do. It.

In the spirit of Lent (is that still on?) I am giving something up. A bunch of words, actually. So a portion of this pathetic blog will be turned over to a homage-to-renters letter which is making the digital rounds these days. I think it’s worth devoting some of our real estate to.

First let’s review the latest news. The housing market is growing increasingly schizo on us. Toronto numbers are torrid (especially after the real estate board fluffs them) while in Vancouver listings are up 16% and sales have crashed 29%. Real estate’s suddenly developed intense microclimates, so parts of the country are in severe drought while others get drenched. In general, it’s not a healthy trend since local conditions can change a lot faster than national ones.

This is why there’s no Spring market in Kelowna, London or Victoria and yet horny millionaires storm sales centres in the xburbs of the GTA. Along with the MSM talk of bubbles, household debt and looming mortgage rules, it’s enough to make ya worry. Which is exactly what’s happening.

The word this week is that a huge majority of people have absolutely no intention of entering the housing market, 2.99 mortgages or not. The mortgage pumpers at RBC must wish they’d never commissioned their annual poll on home-buying intentions, because it’s a bust. A whopping 73% of people say they are steering clear of real estate, unlikely to buy anything for at least the next two years.

This is a shocker because (a) mortgage money is so cheap it’s almost free, (b) almost half of Canadians think rates will stay ‘ultra-low’ for at least a year, (c) two-thirds believe it’s therefore a good time to buy and (d) 68% say the value of their homes has gone up lately. So why run for the sidelines?

The bank says: “Canadians still feel confident about real estate but are a little uncertain about where the market is heading and when it makes sense to buy.”

This miserable blog says: Finally. Households dripping in debt. Inflation growing faster than incomes. A trillion in mortgages. Buck fifty gas. Carney ready to jump rates in a few months. New banking regs coming. Government cutbacks. Insane prices. Rock star realtors. Greedy sellers.

Why would any reasonable person not stand back and let this thing suicide?

So here’s an example of exactly this sentiment. “An open letter to my renter friends” was written Heather Setka on her CashGab blog. I first read it some days ago when it was being Tweeted around – an interesting development on its own. I strongly suspect – bidding wars, idiot realtors, greater fools, Global TV and horny virgins aside – that we may just have turned a page.

Dear Friends Who Are Not Homeowners,

I love you. I love your leaky faucets and your wacky room layouts. I love your stark white walls and your durable stain-resistant carpets. I love your visitor parking spaces and your basement window views.

But most of all, I love you.

I love you so much that I’m going to ask—nay, beg—that you think long and hard before you buy a house/condo/duplex/townhouse/acreage/walkout/treefort.

I know, I know, house prices are currently much lower than when idiots (me) bought their homes five years ago during Calgary’s mad real estate rush. And I know, I know, interest rates have been historically low, and looming threats suggest this could end at any second, and you feel pressure to grab on while you can.

Don’t. Do. It.

Wait, let me rephrase that. Don’t do it unless the No. 1 reason you want to buy a home is that you’ve found a neighbourhood you can see yourself living in as a senior citizen. Because, given how long mortgages are these days, that may well be the case.*

I know people say renting is a waste of money. Since when is it a waste of money to put a roof over your head?

These same people say you need to build equity.

Let me tell you how much equity I have—almost none. Due to down payment mortgage rules I was only sort of listening to and, obviously, still don’t understand, I have a few thousand dollars worth of equity—after five long years of paying an astronomical sum each month. There are other things you can rely on instead of equity. Like a silly little thing called savings, for example. And please, please don’t listen to people who tell you owning a home is a financial investment. That’s antiquated advice. Maybe it was a guaranteed investment for your parents—who paid for their home then what you pay for an SUV today—but not for you.

My dear renting friends, I’m clearly not equipped to give you financial advice. But I do have a little more life experience (mistakes) and so I can say this with complete sincerity: only buy a home if it’s a lifelong dream. Only buy a house if it’s your No. 1 childhood goal, right up there with playing the bongos in a Reggae band or winning an Olympic gold medal in that weird dancing horse sport called dressage.

Oh wait, there is only one more good reason to buy a house. It’s this: you want to relieve an unwed mother of her burdensome now-35 year mortgage on a condo she purchased during the height of the boom, and will probably never see what she paid for it.
In that case, have I got a deal for you. Call me.

Love,
Heather

* I have 24 stairs in my condo. The thought of climbing these stairs at 68 years old (when my mortgage amortizes) is really, really, really depressing.

By the way, did I mention that even legendary (in her own mind) economist Sherry Cooper is now souring on housing? I mean, read this. Of course, she just sold.

183 comments ↓

#1 Victor on 04.05.12 at 9:12 pm

FIRST!!!

#2 HAHA on 04.05.12 at 9:13 pm

FIRST!!!

#3 LJ on 04.05.12 at 9:20 pm

That letter from Heather is a classic. I’ve read it a couple of times now and it is great. Well written and succinct. It should be printed on the front page of every real estate newspaper section this weekend!!!!

#4 tron on 04.05.12 at 9:22 pm

There is a realtor in Northvan that sends me listings everyday via email. The listings are for 2-3 bedroom townhomes. For the last week every listing is reduced by 3-5% with new prices…every listing. It’s here to stay and what’s left to see is if the long way down will be fast or slow.

#5 HAHA on 04.05.12 at 9:25 pm

Okay forget the first stuff… this letter really touched me. I feel for this poor woman and everyone in her situation. I can only hope that lots of these “rockstar realtors” get a taste of what they doled out and end up stuck between a financial rock and a hard place.

#6 zombiehoffa on 04.05.12 at 9:27 pm

Amen Heather. Calgary real estate is absolutely ridiculous.

On a side note, what is with all these people posting “FIRST!!!” all the time? That was cool in 1997 on Slashdot.org. You guys are 15 years late and on the wrong website.

Garth, is there any way you can just discard these silly posts? There may even be an automated way to do this in whatever software you use to run the blog.

#7 Blasé on 04.05.12 at 9:29 pm

finally, its over.

#8 mel in victoria on 04.05.12 at 9:31 pm

Curious…..Have you thrown in the towel as far as the precious metals go?

#9 Scalgary on 04.05.12 at 9:32 pm

Heather,

I love you too…!

By the way, I live in one of the nicest condos in down town Calgary. I have two employees working for me without paying a single penny i.e., Resident Manager, Resident Maintenance Technitian… They are at my service at a single clap of my hand…

Love renting…

Happy l
ong weekend everyone..!

#10 John on 04.05.12 at 9:37 pm

I’m sure most people saw the Toronto Star today and the long article about condos. After several years of not following almost anything about Canada, it’s quite an eye opener to have a look again. Things are off the rails.

Included in the article ( below) that talks so glowingly about condos ( and how Toronto is finally catching up to London and New York), is an extra article entitled “how to win a bidding war”.

So here’s the deal. There is absolutely no way in hell a major paper like The Star could be putting that info out legitimately. This isn’t just some person doing 4 minutes on the net and talking to realtors. It’s a paper with an editorial staff and a research department.

They KNOW.

And they put that out to catch a few thousand more people. Think what that means.

It has taken me years to become an even reasonably independent thinker…I left Canada the best part of 15 years ago. The average Canadian has no idea how brainwashed he is. It’s all a “belief pack” based on knee-jerk emotions and unexamined assumptions.

Waking up is ugly though…there’s a lot less short term pain in buying the condo for 900,000 that has a “shoe-shine station” in it ( “just like a hotel”). Couldn’t a guy actually STAY in a hotel for 30 years for a million bucks…like…at least a 4 star?

http://www.thestar.com/iphone/Business/article/1156743

#11 FI Guy on 04.05.12 at 9:38 pm

Agreed – we have turned a page. Based on what I know and see in my employer (a financial institution), we are very close to “Peak Credit”. The level of credit in the system is unsustainable, which will result in devaluation of collateral (housing real estate) when a triggering event occurs.

And when this bubble bursts, it could actually be worse than the US. A lot of the lending is very, very similar – the only difference is the triggering event (different types of teaser rates, levels / amount of fraud and delays in resetting of rates). The Canadian lenders will go after assets – RRSPs, etc – upon default (vs. USA, where one can simply give the keys to the bank). Individuals will have no options but to put up the house for sale (if there is any equity left) and will be left less assets. The mortgage insurance underwriting is actually worse and more pervasive. It is often hard for me to believe what CMHC and Genworth are insuring and what their logic is. It isn’t right….heck, it’s not ethical.

From what I can tell, it’s hard for those in the industry to see it because of the past. Historically, the banking industry has been backwards thinking using what is called an “incurred loss model”. If there is no loss today, there will not be a loss in the future.

Since default rates have historically been low, that tells all the nerds in the back office that the future must be rosy as well. This goes on in both the banking side of the industry as well as insurance. CMHC and Genworth’s loss provisions do not account for housing bubbles – and neither do the banks.

#12 Smoking Man on 04.05.12 at 9:48 pm

I’m so drunk I’m going to tell you what I really think for a change. Two bottles down, my head is spinning. But hear is way its iz for all its worth.

Your all chumps, GTA prices will go up for years and years. Your too well educated to think for yourselves.

That’s your problem not mine.

I’m too drunk to care anymore.

#13 Toronto_CA on 04.05.12 at 9:49 pm

The GTA is officially nuts. Seeing corrections happening in Vancouver (finally) is interesting. I’m holding off until interest rates rise, but if prices keep going up even with interest rates going up (without corresponding salary rises) or OSFI changes their rules – after that I’m going to pick up my toys and play somewhere else. There’s a LOT better places to live than the GTA. The prices are not based on any reality I can fathom.

Of course, I did read/see that some of the numbers are manipulated. I just can’t see how condo prices can be rising 10% with the slew of condos being built. Luckily, I’m renting a great place for a great price with no commute.

Thanks so much for this blog Garth. It’s great.

#14 Extron on 04.05.12 at 9:50 pm

Garth I love that letter.

#15 Poorboy on 04.05.12 at 9:53 pm

#8 mel in victora

This is not investment advice. Always talk to a financial advisor before investing.

Hypothetically, if I wanted to invest directly in gold in the next little bit here is what I would do.

Precious metals are in for a volatile ride in the short-term. US jobs report is out tomorrow – I will watch for the result. If it’s very positive, gold is likely to drop even more than it has recently.

However, in the mid-term, gold is not done yet. The deficit in the US is not going away and more money will be printed – this is assured. If I wanted to invest directly in a gold bullion ETF and the US jobs report tomorrow is positive, I think the ensuing drop in gold prices would be an excellent entry point for a position.

But I would certainly be sure to limit it to a small part of my overall portfolio. I might hypothetically invest no more than 15%. And I would certainly not view it as a long, long-term investment. Certainly it might break $2,000 or beyond. But flip a coin to figure that one out – gold is very manipulated. Everyone can see that it is over-bought and a correction will come. When? Well that is the trick. It’s like trying to time the Canadian real estate crash – nobody will get it exactly right.

#16 Ronaldo on 04.05.12 at 9:56 pm

Time for the “Flip Watch”. 353 days on the market.

http://www.greaterfool.ca/2011/06/page/7/

”The house above, at 2556 Trinity Street, frame covered with a coat of stucco, was built 60 years ago. It has two tiny bedrooms, one bath, contains just 940 square feet and is butt-ugly. It was listed in March and sold in two days to a realtor who paid $773,000. Now it’s back on the market, this time aimed at Asian buyers – at the ‘lucky’ price of $888,000.

That’s an increase of 15% in 75 days, and multiple offers are expected. Says blog dog Doug: “It’s one thing for Joe Public to be speculating on real estate, but when realtors are effectively buying and selling to each other pocketing the commissions or cutting them out completely while inflating the price adds another level to the pyramid and one more ball in the air.”

Sept. 23/11 – asking price was $868,000

Now asking only $875,000. What a steal.

http://www.bcbudongsan.com/property_details-V929592.html

Seems things have slowed down a bit in the east side.

#17 Tim on 04.05.12 at 10:02 pm

Well, dr gloom and doom, you neglected to mention some small news that the economy created over 80,000 jobs last month, the best month since the recession. Just thought I’d mention that so that your blog isn’t one-sided lol
By the way, what happened to the massive sales listings that were supposed to hit in March as you predicted?

I didn’t predict. But they just hit Vancouver. And today in Victoria new listings were four times sales. GTA soon enough. — Garth

#18 industrial Guy on 04.05.12 at 10:04 pm

What happens if there are 1/4 million Heathers out there with CMHC insured mortgages?
That’s a lot of for sale signs. That’s a lot of home owners without any equity.
If she sells at a loss ….. which bank is going to provide her an unsecured loan to cover her losses and the Realtor’s commission?

As a taxpayer, I would be very annoyed with my Federal Government if my taxes go up to cover CMHC’s losses on insured mortgages sold to real estate speculators. According to a report from the Canadian Bankers Association, 16,236 Mortgages were in arrears in Canada January, 2012 (Mortgage arrears is three or more months) At .38%, It’s not the highest percentage ever recorded, but neither is it the lowest.
http://www.cba.ca/contents/files/statistics/stat_mortgage_db050_en.pdf

I recall a report form The Canadian Association of Accredited Mortgage Professionals last year that claimed a full 200,000 mortgages would go into default after just a 1% increase in rates. It sure looks like that is inevitable now.

#19 Not 1st on 04.05.12 at 10:06 pm

In 2006, there was a show on based in California, I think it was called million dollar property or something. It followed a group of realtors as they got well to do people and dreamers into real estate big time byt selling ocean views, stainless steel, granite and host of other ridiculous features in these homes.

That was all fine and dandy, until subsequent seasons of the show started featuring kid realtors that were maybe 20 years old driving bimmers and shilling property like whores. I knew something was brewing then.

Or in the same year a show called flip this house was all over TV and featured some Atlanta home boy buying the crappiest houses, gutting them and listing them for hundreds of thousands more.

Its all foretelling of what lies ahead in a bubble.

#20 Observer on 04.05.12 at 10:07 pm

With QE3 now unlikely, gold has nowhere to go but down, in my opinion. The US recovery, in my opinion, will be very slow, but might be accelerated if Romney manages to dump the Boy. Credit tightening up here, followed by rising interest rates, in my opinion, will stall the housing market and the bubbliest areas will see decline. I’ll just keep my feet propped up on my big soft ottoman, watching for bargains.

#21 mel in victoria on 04.05.12 at 10:09 pm

POORBOY……..

“#8 mel in victora

This is not investment advice. Always talk to a financial advisor before investing.

Hypothetically, if I wanted to invest directly in gold in the next little bit here is what I would do.

Precious metals are in for a volatile ride in the short-term. US jobs report is out tomorrow – I will watch for the result. If it’s very positive, gold is likely to drop even more than it has recently..”

I know POORBOY………..but when are YOU going to buy?

#22 Harlee on 04.05.12 at 10:11 pm

Oh, I love Heather’s letter. Certainly gives me some warm fuzzies….Thanks to Garth for sharing it.
Also thanks to Ronaldo @ 186 (Bad dogs) for that link on TD.Now it’s a little clearer as to what that TV ad was getting at.Learn somrthing new every day….

#23 Not 1st on 04.05.12 at 10:13 pm

Dear Skatch property market;

I know you have been depressed for 30 years and now have experienced a mini economic renaissance. Thats great…looks good on you this time. But I have to say you are not immune to shocks. Commodities are your bread and butter and they always cycle…like in the 70s, early 80s, 90s and now. The bust is always around the corner.

My wish for you is that you can navigate the next downturn, but with some shacks in town over the million dollar mark, some people are in for a surprise one day. Even starter homes for the young ones are in the $300k range. Its scary out there.

p.s. and please just hold for 6 more months till I can unload.

#24 Makavelli on 04.05.12 at 10:18 pm

#12 Smoking Man on 04.05.12 at 9:48 pm
I’m so drunk I’m going to tell you what I really think for a change. Two bottles down, my head is spinning. But hear is way its iz for all its worth.

Your all chumps, GTA prices will go up for years and years. Your too well educated to think for yourselves.

That’s your problem not mine.

I’m too drunk to care anymore.
“””””””””””””””””””””””””””””””””””””””””

Dude, STFU man! You’re a intoxicated junkie and probably full of shit. Price in the GTA will start to fall next year. After you clowns see the declines in Vancouver, you will be shittin’ in your pants. The horniness will end, and Pfizer will be broke.

The end

#25 Bobby on 04.05.12 at 10:21 pm

The market is definitely cooling here in Victoria so it is a good time to start looking. Came across one home I looked at about 4 years ago. It is back on the market now listed $10k less than when I looked at it but has had extensive renovations. I understand it had originally sold for list. Who said prices always go up?
There are lots and lots of listings now in my area.
Looking like a good time to lowbal!!

#26 mel in victoria on 04.05.12 at 10:29 pm

Trying to guess the bottom of the housing market anywhere is like trying to guess the bottom of a plunging equity…Good luck!!

#27 Blasé on 04.05.12 at 10:30 pm

the chip on your shoulder is showing ashtray man.

#28 Makavelli on 04.05.12 at 10:30 pm

#16 Ronaldo on 04.05.12 at 9:56 pm

http://www.bcbudongsan.com/property_details-V929592.html
_______________________________________

DELETED

#29 god on 04.05.12 at 10:32 pm

#12 Smoking Man
you drowned in your own blood, died, put in a morphine coma.revived and realized there is nothing after death.
a little morphine induced coma,reaks havoc on your cognitive abilities.you will die again, but before you do, sit on that humble grate and i would love to hear what your song is in a years time,singing like a lark,roxanne for me.
the universe is irrelevant.
isn’t it wonderful to have died and know your destiny.

#30 condopoor on 04.05.12 at 10:33 pm

Garth,

What are your thoughts on the correlation between our potential fuel “crisis” and the RE insanity?

#31 disciple on 04.05.12 at 10:40 pm

Dear Heather,
I really feel sorry for you and your child(ren). But remember that while others on here would say that you deserve your fate, I would say that you are mostly a victim, and it’s not entirely your fault. Garth calls it the real estate industrial complex. Just keep trying something new, something will work out. I’m psychic that way…

I did some shopping today, with many equities on sale. Life is awesome with no mortgage debt to worry about, no interest rate provocations, or bankster shenanigans to worry about, just collecting my dividends and capital gains and DRIPping my way to the promised land… Invest in Canada, not in Harper’s fascist vision of it, and you’ll do just fine, in my estimation. We should be investors first, consumers second. Like offering food to your comrades before digging in yourself. That set of manners is brought to you directly from the Greatest Generation…sorry boomers…

#32 Makavelli on 04.05.12 at 10:44 pm

#17 Tim on 04.05.12 at 10:02 pm

————————————————
You obviously don’t know the situation in the BPOE. Sales are happening in only certain areas. Richmond is flooded and prices will fall fast. The median price in Richmond is down $40,000 YoY. These crazy prices are not sustainable.

Smoking man,

If you don’t care anymore, why are you still here? Shouldn’t you be smoking your crack and drinking your hard?

#33 Kilt on 04.05.12 at 10:58 pm

Hey Garth.

How statistically important is 73% of people saying they are steering clear of real estate for the next 2 years. I am assuming this is 73% of renters.

If there are 13 million households in Canada and half a million sales each year, then less than 4 percent of properties change hands in a year. If 27% of renters are considering buying in the next two years, that would account for 8.1% of households if you assume 30% of Canada rents.

Also, did they factor in offshore buyers?

Happy Easter.

Kilt.

No, not renters. General population. — Garth

#34 Not 1st on 04.05.12 at 11:03 pm

Garth, you have written about backwaters like Kelowna and Windsor. When are you going to write a real article about saskatchewan and namely Regina?

http://www.theglobeandmail.com/report-on-business/economy/jobs/regina-outpaces-the-rest-of-the-country/article2393672/

Is that why you’re like that? — Garth

#35 45north on 04.05.12 at 11:07 pm

Toronto_CA: The GTA is officially nuts.

back to the future in the 905. My brother-in-law lived at Highway 7 and Islington. Houses were $600,000, two or three cars per house. Gas is $1.35 at Canadian Tire in Ottawa, Garth says it’s $1.50 in Toronto. $1.50! I remember being at Doe Lake when Hurricane Katrina hit New Orleans. It didn’t reach Doe Lake but the price of gas did. So what do I mean “back to the future in the 905”? Obviously, people in the 905 will cut back on their driving. In the 1950’s my mother stayed at home, a horse-drawn wagon delivered milk, the ice-man came into the house to put a block of ice on top of the refrigerator, the bread man delivered bread and desserts. Somehow I don’t think the good women of the 905 are going to wait for the milk man.

#36 Cory on 04.05.12 at 11:11 pm

I watched Julie Dickson from OFSI on BNN today, it was clear these proposed regs will not take shape. She is floating away from the bubble (i.e. banks are prudent..no bubble), just as F and Carney are tossing the responsibilities amongst each other.

She will not move ahead with these changes since the banks are moving “on their own”.

I win $100…who will be paying me??

#37 Retired Boomer - WI on 04.05.12 at 11:14 pm

#31 Disciple…couldn’t agree more….

…except VALUES – which is what you have described so eloquently are not confined to any single generation. Yes,
disciple, there ARE jerk Boomers….also jerks in the Milennial’s, also every other generation, past as well as those we share the planet with currently, as their undoubtedly will be in the future. Surprisingly, VALUES are usually passed from one generation to the next. From where did your Values arise?

Yeah, no debt is wonderful, isn’t it?

#38 Bill Gable on 04.05.12 at 11:19 pm

Just watch how many sales fall through because what I call the death condition….that being on condition of sale of current property. It will drown a ton of deals.
I must have tried a hundred times to get my house horny siblings to read this blog, and they went ahead and bought not one, but two properties, without dumping their principal residence. That alone was beyond dumb, but now they have been slamming 20 K worth of stuff into the house they desperately want to sell, while they pray it will sell. Victoria. As if.
Mr. Turner has warned us that us bipeds are herd animals.
Luckily, I believed Mr. Turner (full disclosure, he is my Fiancial advisor – and he’s a very smart, and genial, and dead honest gentleman). We rent.

I sleep at night.

My fried family members, are living on Maalox.

You can beg, cajole, etc. – but in the end, most people will blow it.

Heather – your honesty broke my heart. I think there are hundreds of thousands of people in your position.

Meanwhile, we now have “Real Housewives of Vancouver” polluting the airwaves.

Egad. This is going to be a long painful Spring and Summer for all those kool aid drinkers.

Oh, and if I read one more drunken Smoking Man post, I am going to hurl.

#39 Canadian Watchdog on 04.05.12 at 11:21 pm

#17 Tim

Today’s numbers were early seasonal changes in natural resources, construction, manufacturing, health care, ect. This is normal. The bad news is finance, insurance, real estate and leasing has declined for the seventh consecutive month by 0.4% in March (unadjusted). Not good, but regardless, the trend that’s worrisome and will destroy first time home buyers in the coming years is shown here. http://i40.tinypic.com/2zqraee.jpg

#18 industrial Guy

CBA mortgage in arrears data is not a good indicator of actual defaults because the banks flip foreclosures/power of sales after 60 days of a defaulted payment, that is before 90 days. Therefore, CBA’s 90 day arrears is more of a buffer indicator.

I had a little exchange with CBA on twitter where they replied saying stats received from the banks are not verified. On top of that, they didn’t answer if their stats included CMHC, which is not a chartered bank, rather a quasi-government entity who holds mortgages on behalf of covered bond investors.

Sooner or later, our banks and CMHC will have to be more transparent and disclose information to bond investors if they want private capital funding. The is why OSFI is focused on transparency rather then rules and regulations.

#40 AprilNewwest on 04.05.12 at 11:21 pm

Tim #17 – From what I’ve been hearing – Peter Mansfield, Lang and o’Leary show, guest speakers on these programs and on radio say most of these newly created jobs are part-time, temporary, low paying, no benefits.

#41 Ronaldo on 04.05.12 at 11:21 pm

Good night-time reading re: the top 1%.

http://www.vanityfair.com/society/features/2011/05/top-one-percent-201105

#42 Donnie on 04.05.12 at 11:35 pm

Garth – How do we short the Canadian Real Estate market?

#43 Rich Renter on 04.05.12 at 11:36 pm

#33
73% of renters will never buy a house if you really must know since they prefer the mobility or accept that they simply can’t afford one.

#44 Mister Obvious on 04.05.12 at 11:45 pm

Sherry Cooper says:

“I have a family member who paid about $750,000 for a house in Indiana in the late 1990s. She doesn’t think she could get $350,000 for it today.”
———————-

I hear ya, Sherry. I really do. I bought an F-150 in the late ninties for $22,000. I doubt I could get $5,000 for it today. And I’m only talking trade in value here.

#45 Mr Buyer on 04.05.12 at 11:52 pm

#10John on 04.05.12 at 9:37 pm
Couldn’t a guy actually STAY in a hotel for 30 years for a million bucks…like…at least a 4 star?
……………………………………………………………………..
Yes, one could life in a hotel for a very long time for a million bucks which goes to the heart of this bubble. If you have no collateral you can not however borrow the money from the bank to get the million to take up residence at the hotel. The taps were turned on by the Harper Government and left running.

#46 Mr Buyer on 04.05.12 at 11:53 pm

one could live, not life. Pinhead, I am an utter pinhead.

#47 Suede on 04.05.12 at 11:59 pm

#34 Not First

Don’t beg someone to do your work for you. It’s easy enough to look it up yourself:

http://www.reginarealtors.com/index.php?option=com_content&view=category&layout=blog&id=11&Itemid=11

Always question the source, purpose and intended audience. Happy reading.

Report back to us with your findings and put some satire and sarcasm in the comments and voila – a platform to express your thoughts.

As for the article in the Globe you linked…Don’t be misled by articles that basically say “You just got a higher return on something that’s among the lowest averages in the country.” For Saskatchewan to catch up to the economic output of Ontario, Quebec, BC or Alberta is a long way off. They’d need to find a plethora of oil, swedish bikini girls or fusion-energy-in-a-can underground those great plains to come close to those afore mentioned provinces.

Maybe if a huge Uranium find turns up in the Athabasca though..

#48 Mr Buyer on 04.05.12 at 11:59 pm

Contrary to what some are merely asserting here Real Estate prices are not going to continue to rise, not even in TO. We will not have to wait much longer now that sales have been falling, even when so called micro-climates are taken into consideration. The pumpers here need you to believe prices will continue rising so they can make it out of their leveraged positions. THE BUBBLE HAS TOPPED. BUYER BEWARE. NOW IS NOT THE TIME TO BUY A HOUSE. There is no substitute for savings, contrary to popular belief.

#49 furst on 04.06.12 at 12:01 am

FURST!!!!

#50 Mr Buyer on 04.06.12 at 12:03 am

Looking like a good time to lowbal!!
………………………………………………………………………
NOW IS NOT THE TIME TO BUY AN OBSCENELY OVERPRICED HOUSE FOR 10k LESS THAN LISTED PRICE. WAIT, AND THEN WAIT LONGER. ALL GOOD THINGS COME TO THOSE THAT WAIT. ESPECIALLY DURING THE CRASHING OF THIS BUBBLE.

#51 rw on 04.06.12 at 12:06 am

This is what’s making headlines in Kelowna these days:

Kelowna restaurants suffering tough times

http://www.kelownacapnews.com/news/146167055.html

#52 TRT on 04.06.12 at 12:07 am

Consider this: Every province and metro area had increased population in the last census. So there are no areas losing population. Vacancies are loq everywhere. What gives? Immigration was 550,000 (all categories) last year. Most come to Vancity and Toronto….Hence the local conditions. No they don’t go to Kelowna, London, or Victoria!

#53 TRT on 04.06.12 at 12:09 am

#36 Cory

There are many hidden agendas as long as $ or ulterior motives are involved. Very difficult to find honest opinions these days… I’m still searching.

#54 mad vancouver on 04.06.12 at 12:32 am

In Vancouver, the debate is getting hot.

Two days ago:
“In B.C., Premier Christy Clark and her “Families First” Liberals could restrict foreign ownership. At city hall, Mayor Gregor Robertson could tax foreign real estate investors at business rates (18 per cent) not residential rates (4.2 per cent). It may not dramatically limit foreign investing but at least they’d pay more into municipal coffers.

Unfortunately, Clark, Robertson and the rest of B.C.’s political elite, which relies on big real estate developers for fat campaign donations, stays silent.

Instead, they prattle on about “affordability,” whining about federal money for rental housing, while realtors auction off our neighbourhoods to the highest bidder in Shanghai.”

http://www.vancourier.com/Vancouver+realtors+cater+wealthy+offshore+Chinese+middle+class+gets+squeezed/6399697/story.html#ixzz1rEOP8QyM

And now:
“Blaming Chinese for high house prices in Vancouver is racist”

http://www.vancourier.com/Blaming+Chinese+high+house+prices+Vancouver+racist/6417310/story.html#ixzz1rEP6YXAD

What a mess!!!
By the way, I just went to a school board meeting where we were told that it is impossible to open a school in Vancouver East or West because of the housing bubble. The consequences are starting to be far fetched: resentment, racism, young families living, nurses and firefighters unable to stay, businesses closing. That really sounds like a recipe for success. Thank you Christy Clark and developer friends.

#55 Market Bull on 04.06.12 at 12:34 am

That RBC poll is a real “shocker” all-right.

It’s a full ‘two’ percentage points lower than last year’s survey.

By most reputable statistical measures, .02 points is within the “margin of error”, and therefore irrelevant.

#56 AnthEmic on 04.06.12 at 12:50 am

Hi all.

Been reading the blog for years (rarely comment), but figured I might change things up a bit and give a little report from the trenches where the early Gen Y proles like my friends and I eke out our miserable existences – a perspective that I don’t see much around here since everyone is either an “investor”, a bazillionaire, or hording the shiny stuff waiting for planet Nibiru or the NWO to send us all packing to the backyard bomb-shelter.

We’re not the house-horny Ys that get all the attention on this blog, instead we’re the ones who are too worried trying to make ends meet and feed our kids on less that 14 bucks an hour (or the ubiquitous student LOC) to think about houses, investing, and all this fancy financial stuff. Investment to us means putting an extra $10 a paycheck towards taxes so that we get a fat $240 windfall when we hit HR Block come tax-time or dropping $25 bucks on the perfect saggy 1970s couch from the Sally Ann so that once a month we can harvest the change that falls out of our friends/ parents pockets when they come to visit.

Why care what these over-educated, underpaid hipster rejects think, you might ask? Well, because even they, despite not generally talking about high-falutin’ things like real estate, are starting to spread the word about the insanity of the Canadian housing market amongst others in the unwashed masses – word that is bound to travel up the socioeconomic ladder to the folks that people around here DO care about and who ARE throwing the bones in the real-estate casino.

In the last few weeks, peppered among the latest “rage comics” and request to help pick crops in FarmVille, I have seen dozens of Facebook posts about (and links to) overpriced properties, unscrupulous real-estate agents, and the impending housing crash. It seems that Garth’s message is getting out there and is making the viral rounds faster than the herpes on the Pabst Blue Ribbon cans that we gen Y hipsters shotgun daily to make life bearable.

It might not seem like much to write home about, but this does not bode well for the Canadian housing market. When people who normally couldn’t care less about finances and real-estate are frequently posting about it on their Facebook pages it is only a matter of time until those who are interested in these things and horny for the granite and stainless start to take notice too. Once this happens, the sales numbers and stats don’t matter anymore. The meme spreads, new emotions (fear, betrayal, distrust) take over, public sentiment shifts, and houses become as uncool as hummers are to everyone except old dudes like Garth.

The winds of $#17 are a-blowin’ and even we plebes who have long lived downwind and gotten used to various noxious stenches are catching a whiff of the things to come. At least BBQ squirrel will be a step up from Mr. Noodles, ketchup soup, and cafeteria creamer chasers.

#57 Blasé on 04.06.12 at 12:50 am

wrong, they do go to london. if theres a goo school, youll find immigrants.

#58 Fleabitten Monkey on 04.06.12 at 1:06 am

How do you reckon the real estate cartels are going to respond to this study? What are they going to put forth to create the urgency to buy?

#59 City Slicker on 04.06.12 at 1:36 am

Five-bedroom house which was worth €3.3million is now on the market for just €395,000

Read more: http://www.dailymail.co.uk/news/article-2125582/Five-bedroom-house-worth-3-3million-market-just-395-000.html#ixzz1rEfySL3m

#60 patiently waiting on 04.06.12 at 1:45 am

A friend of mine is a top notch financial advisor. He manages a portfolio of (+/-) $500,000,000. Minimum client portfolio is $10,000,000. He recently sold his home for $5,400,000. I exchanged a few texts with him today and asked him if he has bought a new house yet . . . this was his response: “Signed a two year lease on a penthouse downtown . . . will wait this out . . . signs are starting to crack, but the market will take time to fully correct or crash”. Pretty telling when I guy like this who can afford to buy any house he wants is renting in anticipation of a market downturn . . .

#61 coastal on 04.06.12 at 1:54 am

Man I hate renting, especially when I get a brand new deck and sliding glass window at ZERO cost to me…and especially when I get a 270 degree view of Victoria from ocean to mountains for $1150 with 1100 Sq Ft. of comfort.

Meanwhile the local Victoria house blog resident rookie real estate agent plug pumps “lifestyle” as the important reason to own an overvalued POS house/condo while he cuts down Garth’s blog. Go figure. Then CTV Victoria states the truth that the housing market is in the tank and most likely heading down using starving agents in their bit lamenting the “10% of agents make 80% of the sales”. Man I hate renting, the “lifestyle” of having so much cash in my jeans just sucks bigtime. ;)

#62 truth hammer on 04.06.12 at 2:27 am

I disagree that the ‘horny millionaires’ were anything close to that rare element in Canada….if we’re talking ‘real millionaires’ and not ‘credit millionaires’ ….as opposed to ‘dollar millionaires’……all confusing terminolgy which is whats really at the heart of this crazy real estate bubble in the first place. I have the correct term for these people lining up to buy million dollar properties……’borrow millionaires’…..or maybe ‘debt millionaires’ is just as appropriate a term.

The thing about the ZIRP is that it has caused the sheeple to have dizzy spells due to the zany altitude they’ve been taken by the ‘you’re richer than you think’ hype……and the lunatic rantings of the real whores and mortgage pimps about how much ‘you’re pre-qualified for’……….I know people who actually fell for this crap and think they are in fact ‘rich’…….by extension of the fact that they are ‘living’ in a popcorn shack in the burbs that they will never pay off.

A perfect example is the fools in Ogopogo country……where hillside slums were ‘worth’ upwards of 2 million…….until the stock was sold and there were no more suckers to rein in……..now their worth…..nothing…theres no buyers…..and 10 years of inventory rotting on the vine in that god forsaken hinterland on the backside of nowhere.

I worked in finance for a long time…..in a very short time you can tell which people made their money and who didn’t……….real estate is chock a block with those that didn’t.

#63 AprilNewwest on 04.06.12 at 2:40 am

#50 Mr Buyer – I agree. This is not the time to be jumping in the housing market. A $10 thous reduction is nothing considering the over inflated prices sellers want today. As I remember it used to be the norm to allow some negotiating room between asking and selling price. Now it seems people are not satisfied unless they get asking price. People should wait it out for at least a 20% reduction and more if one waits long enough.

#64 ANONYMOUS on 04.06.12 at 2:43 am

Here is WHY the prices for homes in the GTA are just nuts these days:

– If I was selling PLASTIC ORANGES (plastic because they won’t go bad in a month’s time) on the side of the road from a fruit stand, and each orange had a price tag on them of $1,000 each, do you think ANYONE would buy them?
No, of course not, nobody is going to pay $1,000 for a plastic orange.

– Now lets say we ‘up’ that price to $25,000 and we guarantee everyone who buys one of those oranges, that the price will be 25% higher each year for the next 3 years. That means in 3 years an investor can be guaranteed to get back $48,800 for each of those oranges.
Well, you would have about half of the city lining up trying to buy one of those fake plastic oranges.

= THAT is an analogy of why people are bidding up the homes in Canada while homes in the US are not moving, its because the Canadian ‘fools’ still believe that prices will only go up, that its a ‘guaranteed sure bet’.

#65 P & T S on 04.06.12 at 3:57 am

Maybe (just maybe) the hoi polloi are waking up and realising that, if it’s cheaper to rent off a speculator, than to rent money (to purchase RE) off a Bank / Institution, then it makes better financial sense to rent the property off the speculator, and let them carry the risk.

We are always amazed by the smug comments – “you are paying my mortgage” and similar – except that those renting out property seem to forget that they carry the entire risk associated with that property – and things CAN go wrong, requiring LARGE expenditures to put right. This doesn’t even touch on the increasingly thorny subject of “negative equity” which is a whole new source of sleepless nights for those who were late joining the party!

Whilst it’s cheaper to rent than own, we happily rent. We will only consider buying again if the balance is significantly tilted towards buying – i.e. when the streets are awash with those desperate to get out at any price.

(Works for Warren Buffett – works for everyone else too!)

#66 jjpetes on 04.06.12 at 4:09 am

@ #42 Donnie
~Garth – How do we short the Canadian Real Estate market?

——————

If your asking that question, do not ever go short anything.

#67 SC2 on 04.06.12 at 6:20 am

As others have mentioned, the GTA condo boom continues unabated despite prognostications of a bust. The fundamentals continue to suggest that demand is completely outstripping supply and history has thus proven such predictions to be correct.

http://www.moneyville.ca/article/1156743–toronto-s-condo-boom-continues-after-record-2011

#68 betamax on 04.06.12 at 7:06 am

#52 TRT: “Most come to Vancity and Toronto….Hence the local conditions.”

Conversely, immigration must have somehow come to a standstill in 2008, when sales and prices dropped.

No? Then no correlation. Just another myth told to justify what is otherwise clearly unjustifiable.

#69 Bigrider on 04.06.12 at 7:13 am

Financial markets going ‘down’ means RE prices in T.O going ‘up’.

Immigrant, rearview mirror investing cannot be over estimated.

The S&P is up 12% on the year and 30% since last autumn. How are markets ‘doing down’? Or did you mean gold? — Garth

#70 Bigrider on 04.06.12 at 7:30 am

Interesting to note.

There are various financial instruments ,perfectly legal even if not ethical, that allow you to short all financial instruments of various types, thereby supressing their prices and as often is the case, causing distress to companies whose operations depend on the value of such instruments. Short a stock, drive it’s price down and possibly cause the demise of the company and jobs that go with it. Short a bond, cause greater distrust of it’s creditworthyness and on and on.

I question the ethics of shorting. I believe it to be a large part of the struggles of financial markets past 12 years and counting.

What is most interesting to me (aggravating actually) is how I can short my neighbors company(say RIM) for example, legally ,causing him distress, short his bond holdings(distress) short all of his financial assets but I can’t short.. Guess ?

His f–in, G-dm house or RE holdings !!

#71 Onemorething on 04.06.12 at 7:49 am

Sherry Cooper has minimal credibility inside of her circle of influence which might only be the GTA however she’s about to find out what having no credibility inside feels like as well.

She’s just another ponzi pumper along with some other wanna be’s in Canada who feel they have insight!

This group really needs to try looking at the global landscape by travelling it to see what is really going on!

Phone calls from friends who admit they’ve been manipulated still only complain and find reason to blame others!

This is what we have become! What a shame!

#72 TurnerNation on 04.06.12 at 8:18 am

Speaking of Nortel Moments, appears RIM is fast becoming the next Nortel. Single digits are inevitable. Putting it into perspective, Nokia (NOK.US) is trading at 5 bucks…

#73 Beach Girl on 04.06.12 at 8:18 am

Leave Smokin Man alone. He is one interesting character. I don’t understand half of what he says, but that is his allure.

Everyone Happy Easter. Article from some French Woman author, 40 Reasons to not have Children. My ship has sailed on that one. But it is an interesting read.

Expecting an army of unwanted this Easter. Bought a ham and turkey. My lawn will be cleaned, we will all get hammered. But, first we have to visit some of the unloved in Penetang Jail. A family outing. I call us Swiss Family Dysfunctional.

So far I have a NASCAR driver, a NCR (Not Criminally Responsible) mentally ill young man. He wants to start a bike gang. Except, it is with scooters. I think him and the race car driver will get along. Two young pole dancers, not Polish, but can polish. Resident skin head and a rather lovely young man and his girlfriend a professional cheerleader. Let the games commence. Of course the flame wants to appear, with the arrival of those guests.

Laughter in Paradise. You can’t choose your family, but you make more friends.

Have fun everyone.

Now, it some shithead says this doesn’t apply to this serious housing blog (if you need half of this advice you are retarded).

Jay, the Gas Station man is in, everyone hates him because of the price of gas. He says I am from India, not my fault. He wants to see the cheerleader, the dancers, okay. Wants to see the beautiful girl.

#74 househornyhousewife on 04.06.12 at 8:20 am

Garth,

I still believe that generalizing about real estate is erroneous on your part and have thought this ever since coming to your blog those many months ago.

Your comments are “bang on” for people in the big cities, especially those looking at the condo market. I have NEVER been able to understand why ANYONE would spend even a dime on buying these things, unless they were in a gorgeous location in the penthouse with a breathtaking view of the mountains, lake, city skyline or whatever … (and then we are talking millions and millions so it is STILL not worth it).

If you are thinking of buying a home, then it is your own local market that you have to look at and this includes your own household situation.

If you live where I live, you can purchase a beautiful perfectly maintained bungalow on a half acre of land for around $180,000.00 (and this includes all appliances, curtains and light fixtures too !). If you are a couple living here and you work in one of the main industries, that being either the hospital (a university centre which serves the entire Eastern Townships and beyond so it’s a huge employer) or one of the universities or CEGEP’s (two universities and several CEGEP’s and high schools), then you probably earn somewhere around $80,000.00 and if you are two then your household income is somewhere around the $120,000 – $150,000.00 range. If you have paid off your student debt and you don’t plan to start a family right away, why in the name of heaven WOULDN’T you buy a nice house if that is what you want ?! With this kind of financial situation, you can easily pay for the house AND put something aside for retirement … EASILY.

Each individual has to look at their particular situation before they even LOOK at a house so that they can decide if a) they can even afford to buy ANY house and b) if so, what kind of house can they afford to purchase. For (a) you have to look at 1) your income and how secure it is (how likely you are to lose your job and if so, how marketable are your skills so that you can get another one), 2) your age and how many more years you have to contribute to the household budget, 3) your debt and 4) your savings in relation to your age and what you want to achieve during retirement (what you see yourself doing at this time).

Once you know all of that, you can calculate how much money you can contribute each month to a home and once you know THAT, you have to figure out what a home must cost you in order to afford it once you have taken out all of the costs other than the mortgage (insurance, maintenance, taxes etc..). The figure you arrive at is the monthly payment you can ACTUALLY afford to make and this will give you the value of the house you can afford.

I virtually guarantee you that NO ONE does this but instead works in reverse .. ie. they FIRST look at the house they want and then figure out how they can sacrifice their entire life in order to have it. If they DID do what I said, many many many people would either purchase lower priced homes that they could afford (either more modest properties or properties outside of their metropolis) OR they would rent.

In addition, our market would not be so incredibly ridiculous in the larger cities because NO ONE would bid ludicrous prices for ugly inner city bungalows or, heaven forbid, condos facing neighbouring condo brick walls.

Perhaps we need more education or something so that the public understands what an amortization schedule is and can actually see what they are paying towards the principal amount of a property during the first years (practically NOTHING !). Perhaps we also need basic budgeting courses so that the public can also understand that just because you can handle the cost of the mortgage payment, it does not necessarily mean you can afford that house. A dream house with all of the bells and whistles costs more money to maintain because more can break down whereas a house that is more “basic” can perhaps stand the test of time better. A house with a wooden exterior will cost more to maintain over time than a brick one. A slate roof in a heritage area will cost you a fortune because you may be required to replace it with another slate roof if you need to (which will cost you $100,000.00 !!).

That does it !! I think I am going to start my own business giving courses on real estate ownership. I hear that many real estate agents will be looking for new jobs soon anyway so there should be plenty of labour available.

I don’t understand why the public spends months reading up on different models of cars and their performance before forking out $20,000.00 – $30,000.00 for a vehicle (OK sometimes a bit more than that) but they are willing to line up and put down hundreds of thousands, sometimes millions (!), in an instant to buy something that hasn’t even been built yet. This is simply crazy !

HHHW

#75 Arse on 04.06.12 at 8:37 am

Bad job news in the U.S.

The government said on Friday that the U.S. economy added 120,000 jobs, falling shy of the 200,000 expected. The unemployment rate fell to 8.2%.

Hos is another consecutive month of net new jobs ‘bad news’? — Garth

#76 The American on 04.06.12 at 8:46 am

At #10: John, you said, ” The average Canadian has no idea how brainwashed he is. It’s all a “belief pack” based on knee-jerk emotions and unexamined assumptions.” From what I’m learning each day, I’d have to agree with you.

At #64: Anonymous, you said, “THAT is an analogy of why people are bidding up the homes in Canada while homes in the US are not moving, its because the Canadian ‘fools’ still believe that prices will only go up, that its a ‘guaranteed sure bet’.” You’re absolutely spot-on.

#77 Aussie Roy on 04.06.12 at 8:55 am

Aussie Update

Krugman Versus Keen.

The argument is between Professor Paul Krugman, Noble Prize Winner and undoubtedly the worlds most famous economist through his outspoken NYT column and blog, and Professor Steve Keen – who until recently was a marginalised and little known figure based in Australia. Keen had one major claim to fame though, he was only one of a tiny handful of economists who predicted the great financial crisis of 2007 to today (and Krugman didnt) and the only one to do so with a mathematical model.

http://andrewlainton.wordpress.com/2012/04/06/blog-brawl-bests-nobel-prize-winning-economist-and-gulp-im-dragged-into-brawl/

#78 House on 04.06.12 at 9:16 am

1. The 73% was a 2% rise from the year before. 2.The young, under 35; “think” that these rates will be there for the rest of their lives “they are normal”. So in ten years they won’t have to borrow at 10% to buy a new car.

73% is a big number. Those here seeking to diminish it clearly do not grasp the impact of sentiment on an asset whose value is largely driven by emotion. — Garth

#79 Watching on 04.06.12 at 9:30 am

We are renters who are watching. We have the cash to buy, but think this is an inflection point. Rates have climbed slightly since last year. I check the redflagdeals site. http://www.redflagdeals.com/features/canadian-mortgage-gic-rrsp-savings-rate-comparison/canadian-mortgage-rates-closed/
If you click at the top of a column, it shows you the rate for that time from lowest rate to highest in different institutions, 1yr, 2yr, etc. The lowest is now 3.3, whereas a couple of weeks ago it was 2.9! (Redflagdeals is also good to check GIC rates)
We are 68 and figure we would need a house for about 12 years…. at 80 most move again, so even if we rent for 10 years, it is not the end of the world. Our rent is tied into inflation, just as our pensions are. We have a nice home for $1,350 a month, and got an extra discount on the rent because we are old! (I find this works at B&B’s when we travel as well.) If we are slightly picky, they try to entice us with a further discount.
Don’t cave to greedy sellers, the numbers are turning.

#80 nnso on 04.06.12 at 9:58 am

why people have so much money for bidding war while Governments have deficit and spending cuts….
This article show some insights.
http://www.atimes.com/atimes/Global_Economy/ND04Dj06.html

#81 J.I.M. on 04.06.12 at 10:22 am

I love the Sherry Cooper article; not for the content, but for the comments, most of whom noted what a real estate booster she was, until she finally sold her house. Two days after selling, suddenly she is all cautionary and bearish on the Canadian housing market

#82 torontorocks on 04.06.12 at 10:23 am

wouldn’t listings be up now considering that the spring madness rush for houses with preapprovals at 2.99% in hand will soon be afoot?

#83 Mike Rotch on 04.06.12 at 10:30 am

72 TurnerNation on 04.06.12 at 8:18 am
Speaking of Nortel Moments, appears RIM is fast becoming the next Nortel……….

A rising star that grew bigger then itself, brought in a pile of late-to-the-party investors, made some critical mistakes, and then plummetted to near irrelevance?

Check, check, check, check.

Wondering if Apple resembles Nortel on the way up?

Somehow Apple has managed to convince millions to line up for hours to get a modest improvement a scant few days before you could get the same thing with no lineup…….

They’re the cat’s ass right now, and buyers are piling on at $600whatever.

We’ll see. ‘Droids can be had for half the price, catching up in terms of quality, and don’t force you to use a ridiculous piece of money grubbing bloatware like iTunes……….I could see this market splintering within a few years.

#84 Canadian Watchdog on 04.06.12 at 10:53 am

Hos is another consecutive month of net new jobs ‘bad news’? — Garth

Because net employment is not keeping up with population growth. This is why the Employment To Population Growth ratio is the best measurement of employment. http://data.bls.gov/timeseries/LNS12300000

And this doesn’t include an estimated 10-15 million illegal immigrants.

Toronto chart: http://i41.tinypic.com/35i3lap.png

It’s still not bad news. Over 100,000 more people found work, and in each of the prior months, more than 200,000 families gained jobs. This is incremental growth, not contraction. It’s good news. — Garth

#85 Common Sense on 04.06.12 at 10:59 am

Melanie Gilligan: Crisis in the Credit System & Popular Unrest

Presented by:
Justina M. Barnicke Gallery

Starts: March 9, 2012
Ends: April 8, 2012

Event Time(s):
RECEPTION: THURSDAY 8 MARCH, 7:00-9:00 PM
ARTIST TALK: THURSDAY MARCH 8, 5:30-6:30 PM

Website: http://www.jmbgallery.ca
Email: [email protected]
Phone: 416-978-8398

Costs: Free

The Justina M. Barnicke Gallery is pleased to present the Toronto premiere of two major video works by artist-in-residence, Melanie Gilligan, titled Crisis in the Credit System (2008) and Popular Unrest (2010). In conjunction with the exhibition, Gilligan will be working on a new work, currently titled The Common Sense.

Location:
Hart House
7 Hart House Circle

This is not a public billboard. Don’t do this again. — Garth

#86 Ronaldo on 04.06.12 at 10:59 am

#56 AnthEmic – very good post.

Coming from one of the oldest of the boomer generation I have to say that if what you are saying is even close to accurate then it will be your generation that will have the greatest impact on housing prices in the lower mainland going forward. We know that the myth of the Chinese driving up prices is just that. We used to hear the same thing back in the 70’s from the realtors.

I don’t know what your age group is but I suspect mid 20’s. About the same age as I was when I ventured out to buy my first home with no money. Luckily back then prices were very affordable at around .3 of one persons monthly income. And that was at 10% interest rates. Not like the insanity today at the lowest rates in history. Even if prices in the lower mainland dropped by 50%, it would still be too expensive for you to buy. Good for you that you and your friends can see through all the media hype and b.s. that is going on right now. Things will change and when it does, it will be dramatic. I have been through many booms and busts and this is beginning to feel a lot like the mid 70’s boom and bust. We are at the point now where it will not take much of an event to put a stop to the madness. Hang in there and watch things unfold. I suspect by fall, it will be all over.

#87 Daisy Mae on 04.06.12 at 11:04 am

#52 TRT: “Every province and metro area had increased population in the last census.”

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

Census figures aren’t accurate.

They missed our gated community of 149 homes, entirely…I inquired. The federal employee I talked to couldn’t find West Kelowna or Westbank for that matter, on her map.

So we’ve not been included. One has to wonder how many other discrepancies have there been?

#88 Mikey the Realtor on 04.06.12 at 11:08 am

here is a quote from the infamous blog dawg, Carney

“In exceptional circumstances, if there are issues that threaten financial stability, such as household debt … the bank could use monetary policy for that purpose,” he said. “That factors into our decision-making without question.”

so as we can see here, this man is still talking out of both sides of his mouth, one day he claims that household debt is out of control and the next he says he will step in IF household debt gets out of control. Doublespeak has corroded politics to no return.

#89 Mikey the Realtor on 04.06.12 at 11:12 am

#73 Beach Girl on 04.06.12 at 8:18 am
“Leave Smokin Man alone. He is one interesting character.”

nothing to worry about, you make smoking man look sane.

#90 Oceanside on 04.06.12 at 11:25 am

#81 J.I.M. on 04.06.12 at 10:22 am
I love the Sherry Cooper article; not for the content, but for the comments, most of whom noted what a real estate booster she was, until she finally sold her house. Two days after selling, suddenly she is all cautionary and bearish on the Canadian housing market.
——————————————————————–
Just curious, Where was Sherry Cooper’s house and how much did she sell for.

#91 ex bc boy on 04.06.12 at 11:26 am

wow- somebody loves me. I love you too. Seriously ,I read Heathers Letter a couple of times. I think I might print it. Been divorced for a year and renting and relieved I have cash. Now investing it. Still when you have family(Me Red Deer-kids in Edmonton) there is a strong draw to buy.I miss them. I have looked and talked with people and I am skeptical/mistrustfull. Oh, a bank said I qualified?!! for a $385,000 mortgage. NO Thanks!!

Heather,you are welcome to try and reach me. Garth are you a matchmaker too.

#92 coastal on 04.06.12 at 11:28 am

“Private sector economists are almost unanimous in the view that housing prices are too high in Canada in relation to fundamentals, such as incomes and the cost of renting. That suggests a correction is coming, in the neighbourhood of 10 to 25 per cent, with some hot markets like Vancouver and Toronto possibly facing an even bigger reckoning.”

Brother Carney warned you fools.

http://www.huffingtonpost.ca/2012/04/06/mark-carney-bank-of-canada-debt_n_1407676.html?utm_campaign=040612&utm_medium=email&utm_source=Alert-canada&utm_content=FullStory

#93 Abitibi Doug on 04.06.12 at 11:41 am

On Wednesday night I heard David Chilton (the guy who wrote The Wealthy Barber) and some of what he said sounded like something right out of this sad blog. In fact, if I didn’t know what Garth’s voice sounds like, I would have thought it was him giving the talk. He went on about how many younger people get themselves deeply into debt with more house than they can afford, complete with a lengthy discussion about granite countertops! He also put some blame on HGTV, and on over use of those HELOC’s for renovations, saying the 4 worst words for cost over runs are: while we’re at it. While he made no psychic predictions about interest rates, he did suggest they were unusually low and there’s no guarantee they’ll stay that way. Good stuff, it now appears Garth was way ahead of his time with his predictions on this sad blog.

#94 Canadian Watchdog on 04.06.12 at 12:39 pm

#67 SC2

Did you not notice Susan Pigg/BMO’s advertising campaign smeared all over that page?

Speculation is not fundamental demand and I assure you there are listings piling up because TREB’s just released data shows Toronto C1 (financial district) condo sales are down by 22% y/y. https://docs.google.com/file/d/0ByrPFSoPLahJUGNkMGVRSkJTVTYxeFpiRkpJWG00QQ/edit?pli=1

More interestingly, the INDX project is right next door to BMO’s tower, and there’s a good chance it was financed by BMO, which could also explain why BMO went 2.99% before every bank.

Toronto C01 Sales To Listings Ratio http://i43.tinypic.com/mafne9.png

BMO may be in the doldrums.

#95 daystar on 04.06.12 at 12:51 pm

So Sherry Cooper has finally seen the light, illuminating her advice towards long terms (10 year terms would be the smart way to go without question) and warning of an overheated market. Maybe she finally read this blog or realized she won’t have a career left if she doesn’t send this message from here on in. Better late than never. (sure comes late though)

If readers are looking for a pivotal definitive turning point in RE in terms of valuations I think we are there now. We certainly hit the RE sales volume peak nearly a year ago as F gave the RE market a near 2 month advance notice that he was lowering mortgage payments creating a “now or never” mini boom in the marketplace just in time for spring (the first and only time F ever made mortgage payments more expensive and he created mania by not doing it quickly). We won’t see credit volumes like that again for a long, long time but this credit bubble still has legs and household debt has yet to peak but we aren’t far off from this either. January of next year perhaps if OSFI sticks to the draft proposals outlined?

Household debt won’t grow past the spring of next year for a number of reasons from higher interest rates to negative world events and Italy and later, France and Spain will impact the markets negatively with currency crisis impacts and Iran will be front and center with Israel, the U.S., China and Russia all involved in a resource war perhaps as early as this summer. If such a war doesn’t stay localized to the middle east (which I think it will) then everyone’s lives will change forever.

As for valuations, consumers are exhausted from debt and I don’t see national averages going any higher because its been high end homes and lower volumes that have supported higher national averages and the affluent are about to take a financial hit.

What has boosted the national average year over year has been the markets of T.O. and Vancouver and its been the high end market that has skewered valuations which are typical of wealth effects and their mania’s. Signs of consumer debt fatigue are everywhere but wealth breeds confidence until losses come unexpectedly. Readers should take notice and literal stock of what happened in the stock markets this week as a precurser to what is likely to happen to the balance sheets of the wealthy in Canada going forward.

As the informed reader is already likely aware, gold has been on its way down due to the unlikelyhood of another U.S. fed round of QE 3 and greater likelyhood of higher rates and a strengthening U.S. dollar meaning gold is on its way down, down, down and with it the heavily laiden mining sector in Canada will take a big hit for the rest of this month and likely into June.

Italy is becoming the justified focus in Europe now and commodity inventories should build over a general world slowdown (Europe, China, it had to happen sometime) and since gold is priced in U.S. dollars…

There is also trouble brewing with Italian bonds pushing the dollar higher than expected through to the rest of this month. On the surface, it looks as though the ECU has pumped enough liquidity access for Italian banks to buy bonds that foreign buyers don’t have the appetite for:

http://www.reuters.com/article/2012/01/20/us-italy-bonds-idUSTRE80J0IM20120120

But upon closer reflection, Italy isn’t the only nation struggling with debt and risk who is rolling over significant amounts of bonds this month so competition for credit between 3 debt laden nations can and should disappoint the markets in April:

http://www.informedtrades.com/blogs/jason-rogers/5738-infographics-sovereign-debt-european-debt-maturity.html

Spain is worth a mention here but Italy has always been the one nation to worry about due to the size of their economy and public debt to GDP levels now at an est. 120% in combination with recessionary neighbors significantly hurting Italian trade. (readers take note, France is included here for a reason)

http://www.bbc.co.uk/news/business-15748696

If we click onto France, we’ll see the problem as France is overexposed to Spanish/Italian debt and April is the one month where all three indebted nations (France, Spain, Italy) are borrowing the largest amounts collectively and hence, the headline news:

http://online.wsj.com/article/BT-CO-20120404-710662.html

I think Italy’s debt implosion is still more than a year away and the summer/fall of 2013 is when it comes but one can see it coming now and as Italian bond rollovers meet with higher yields in April, the story will gain more traction.

Italy is taking a terrible path with their approach to rolling over bonds shortening the lengths of maturities to create lower yields but this creates huge sensitivity towards their public debtloads and economic performance. How bad is it? The ECU has allowed Italian banks to use existing loans as collateral to borrow money from ECB funds. The end is near.

My gut tells me that Italian bond markets unravel next year in the summer or fall and France falls in the winter of 2014, 2015. Bond maturities are key to establishing an accurate timeline. What a world climate just in time for rising interest rates out west!! Should be an exciting conclusion with plenty of drama for Canadian housing… next year. (if this is scaring you into locking into 10 year terms, it would be ultra wise to listen to now your fear. Even Sherry Cooper has jumped on this bandwagon)

I’m not clear on the timeline of the other major story between Iran, Israel and the U.S. . All smoke and mirrors and noise aside, another resource war is looming in the middle east and I believe its closer than anyone realizes. Logic suggests the odds of this happening are less than 10% (this year) but once a person familiarizes themselves with the issue this probability goes up. (Gut tells me June will be a tense month that will shake market confidence) I would give the chances of it happening within the next 3 years north of 50% and its implications are obviously dire if it doesn’t stay localized to the middle east region. Even if it does, oil values…. hmmm….

One final thought. (or series of them) I know its not a political blog but this F-35 story breaking from our auditor general on our Conservative ministers knowing about the true cost of F-35’s since June of 2010 almost a full year before the election and then lying about it, a federal election that was literally called for this reason… (14 billion claimed cost as opposed to 25 billion real cost, thats quite a stretch)

http://news.nationalpost.com/2012/04/05/federal-cabinet-knew-f-35s-true-25-billion-cost-before-election-auditor-general/

http://fullcomment.nationalpost.com/2012/04/04/john-ivison-f-35-debacle-saw-canadians-nearly-played-for-fools/

http://www.cbc.ca/news/canada/story/2012/04/04/f-vp-stewart-f-35-secrecy.html?cmp=googleeditorspick

Where there is smoke, there is fire and time might dim the memory in some voters but with a housing bubble on the edge of a cliff before us and the well known history of political decisions being made through CMHC and Bay St connections in an effort to win elections regardless of cost, it all paints an unsavory end to the Harper age.

This is a major scandal that is sure to seriously impact Canadian trust towards the Harper government (and doubtful to be a one hit wonder). A growing number of Conservatives must be thinking that the Harper government doesn’t deserve a majority while the rest of us believe they don’t deserve a minority government when a story like this breaks. Harper has lost a good deal of trust here and I believe it will spill over into what the Harper government has to say about housing precisely because the money at stake is so much higher and this is big, because housing is poised to become “thee” economic issue for the Harper government through to the rest of their majority term beginning in 2013. If Harper doesn’t take a big hit on trust here now, Canadians aren’t thinking or paying attention.

#96 Poorboy on 04.06.12 at 12:52 pm

#21 mel in victoria

I know POORBOY………..but when are YOU going to buy?

I’m not. I presently see better opportunities elsewhere. That could change if gold takes a nose dive but it would have to be a really big nose dive. I’ve found it far more profitable to short gold producers. If this funk OTTGD finds itself in ever turns around, I’ll probably reverse my position because they have a long way to go to get back to the mean relative to the price of gold.

But right now, gold doesn’t provide the right risk vs reward profile for me.

#97 scib on 04.06.12 at 12:59 pm

Look at the comments section of this article:
Anecdotally it seems that a majority of Canadians “get it”, and these are not likely all Garthies blog dogs.
Real estate prices will mirror what people are thinking.
Many also understand the theft of wealth from savers to asset holders through low interest rates.

http://ottawa.ctv.ca/servlet/an/local/CTVNews/20120406/carney-housing-debt-20120406/20120406/?hub=OttawaHome

#98 Victoria on 04.06.12 at 1:00 pm

We want to sell our house and now it is probably too late. We have been in the market for 20 years and are not first time buyers. Our problem is that we have 4 kids, 7-14 and 3 cats and 2 dogs.

In Victoria we can’t find anything decent that would work for our family that is the same or less that we are paying in mortgage and taxes. Many of the homes for rent are incredible dumps. I am even willing to drive 40 minutes each way to get our kids to school.

I wonder if there are companies that can help you find rentals?

#99 Phil Indablanque on 04.06.12 at 1:12 pm

#56 AnthEmic

1 person likes your post (y)

#100 Re-diculous on 04.06.12 at 1:20 pm

According to this, Carney may be willing to act regarding household debt levels afterall
http://www.vancouversun.com/news/Bank+Canada+could+crack+down+household+debt+Carney/6421389/story.html

#101 maxx on 04.06.12 at 1:21 pm

#36 Cory on 04.05.12 at 11:11 pm

“I win $100…who will be paying me??”

Parker Brothers.

#102 Market Bull on 04.06.12 at 1:27 pm

#39 Canadian Watchdog

“CBA mortgage in arrears data is not a good indicator of actual defaults because the banks flip foreclosures/power of sales after 60 days of a defaulted payment, that is before 90 days. Therefore, CBA’s 90 day arrears is more of a buffer indicator.”
_____________________________________________

This statement baffles me. If banks are “flipping properties” within 60 days of default as you suggest, then where are they getting the 90 days in arrears data from?

Is it your contention that lenders “flip” some properties before 90 days in arrears and not others? If so, what are the percentages?

Your level of knowledge and expertise in this area is sadly lacking, if not laughable. You clearly have no first-hand experience with such matters and subsequently no clue about the process, time limits, notice periods, lender’s obligations, etc. etc.

Do you know the difference betweeen power of sale and foreclosure? Do you know what the borrowers “right to redeem” means?

I suggest that you refrain from writing about topics before doing at least a modicum of basic research, lest one be left with the impression that you are full of hot air.

#103 Daisy Mae on 04.06.12 at 1:27 pm

#84 CANADIAN WATCHDOG: “And this doesn’t include an estimated 10-15 million illegal immigrants.”

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

I’ve often wondered….if these immigrants are ‘illegal’ how do they find employment? How do they access social programs? How do they do anything?

#104 Daisy Mae on 04.06.12 at 1:29 pm

I guess it’s all under the table….so then, who is regulating these ’employers’?

#105 Mythbuster on 04.06.12 at 1:31 pm

Garth: You wrote: “Toronto numbers are torrid (especially after the real estate board fluffs them)”

Not quite. While sales are up, AVERAGE PRICE was A TAD LOWER in March compared to February. This suggests demand was ‘pushing on a string’. And thus market has possibly become weaker.

Those who’ve been waiting for the bull market’s ending might have their wish fulfilled in April.

I look forward with great interest to see the April figures. (Note that I’m not writing this note on April 1st… :)

I referred to sales, not prices. — Garth

#106 Adam on 04.06.12 at 1:34 pm

Garth, you say the survey found “a whopping 73%” are not interested in buying homes this year, but this number was 71% last time. This increase is statistically insignificant. I support most of your views but misleading stats lead to less credibility.

If you believe 73% is statistically insignificant, you see things different than I. — Garth

#107 Tiny Bottoms on 04.06.12 at 1:41 pm

Mark Carney willing to act if debt levels keep climbing

“If a point comes where house prices adjust downwards, the question is how is that going to impact consumption behaviour,” Carney asks.

“There is history in other jurisdictions where this has a bigger impact on consumption on the way down than it does on the way up. And the consequence of that is consumption slows, growth slows, income slows, debt serviceability deteriorates, etc, etc.”

http://www.cbc.ca/news/business/story/2012/04/06/carney-household-debt.html

#108 T.C. on 04.06.12 at 1:48 pm

coastal @ #61

“…especially when I get a 270 degree view of Victoria from ocean to mountains for $1150 with 1100 Sq Ft. of comfort.”

You are paying about $600 more than me for twice the space. And I have the same view and no commute.

My buddy rents a 2 bdrm house for $800.

Just think of the square miles of detached homes in Oak Bay, Fairfield and Saanich populated by thousands of recently retired boomers who bought in at a premium. What happens when they start to expire?

Inspiring vistas, what?

#109 Raj on 04.06.12 at 1:49 pm

Mike Rotch

“Somehow Apple has managed to convince millions to line up for hours to get a modest improvement a scant few days before you could get the same thing with no lineup…….”

And trade your kidney for an iphone
http://www.theglobeandmail.com/news/technology/tech-news/five-charged-after-chinese-teen-sells-kidney-to-buy-iphone/article2394072/

I liked your view.I think APPL downfall will begin soon.

#110 FTP - First Time Poster on 04.06.12 at 2:09 pm

#115 – Thanks for the Van Sun article on Carney’s latest pontifications. Here’s part of what the article said:

“We have never been as indebted as we are today as individuals,” Carney told Canadian Press. “We’ve done analysis which shows that about 10 percent of Canadians are vulnerable if interest rates returned to more normal levels, which will happen.”

I find it extremely hard to believe that 10% of individuals would be vulnerable – I think if Carney weren’t talking out his fat, lying, Goldman Sachs ass that he’d say “at least 40% of the population would be royally screwed”. There is no doubt in my mind we’ve reached a tipping point and the Canadian economy will be under a lot of pressure over the next 2-5yrs.

#111 FTP - First Time Poster on 04.06.12 at 2:21 pm

ummmmm…ya sorry meant #100.

#112 truth hammer on 04.06.12 at 2:26 pm

Bwahahahhahahaha !!! Marc ‘Carnage’ Carney is once again in the news over Canadian personal debt now eclipsing the debt ratio in the US and Britain that blew the top off both those economies and plunged the world into chaos…………what an a**hole !!!!

If there was a time for ‘jawboning’ the market back off the ledge Marco………it was five years ago when it was obvious that real estate speculation was taking over under the phony ZIRP that you and ‘Frivolous Flaherty’ dreamed up to keep the pensions and raises of civil servants fat with the increased revenues out of the tax creep created out of rising ‘values’.
……….Marco……you’re not worth the $500,000 a year we pay you…..any clown could wipe Flahrety’s bum.

#113 Canadian Watchdog on 04.06.12 at 2:29 pm

#102 Market Bull

Yes I do know the difference. Foreclosures have a judicial process that require an order nisi set out be the courts, while a power of sale is contractual. Ontario is one of four provinces (other being Newfoundland, New Brunswick, Prince Edward Island) that can enforce a power of sale with no court order (Ontario Mortgage Act). The clause is included in most mortgage contracts in these provinces. The rules are as follows:

The bank sends out a notice to the borrower after 15 days of the defaulted payment. Upon that notice, the borrower has 45 days to correct the payment (this is 60 days now). After 45 days if the borrower has not made a payment, the bank can list the property as a power of sale with no court order.

To my point which you missed; with the average home selling below 30 days on the market, the bank can sell the property (flip whatever) within the time frame of 60-90 days. That is why 90 day arrears is more of a buffer or indication of power of sales that have not been sold.

Get it? Good. So next time shut your mouth before you try to discredit me again.

#114 Investx on 04.06.12 at 2:36 pm

Why rent if you can put down a sizable down payment (the traditional non-sublime 20 – 25%) and build equity with mortgage payments that are not any higher than the cost to rent?

#115 daystar on 04.06.12 at 2:49 pm

http://news.ca.msn.com/top-stories/mark-carney-willing-to-act-if-debt-levels-keep-climbing

This is the first time I’ve ever heard Mark Carney will raise rates to squash the number one threat to Canada’s economy. Some clips:

“We’ve done analysis which shows that about 10 per cent of Canadians are vulnerable if interest rates returned to more normal levels, which will happen.”

Mark has all but said that such an event (normalized interest rates) will breed a recession. Mark Carney goes on:

“There is history in other jurisdictions where this has a bigger impact on consumption on the way down than it does on the way up. And the consequence of that is consumption slows, growth slows, income slows, debt serviceability deteriorates, etc, etc.”

I.e., every bubble has the same result, its not different here and Mark makes this point as well:

“Carney reiterated that broad-brush Bank of Canada policy should be the last resort to correct what is essentially a specific problem. Other policy-makers in government have more finely-tuned instruments.”

While a few would disagree with this assessment, I know he’s right. I’ve always known he’s right and what is he saying without really saying it? Its up to the federal minister of finance to initiate policy that controls household debt from becoming the #1 threat to Canada’s economy and its not hard to see this based on simple results (household debt to GDP now at 153%, collective mortgages growing past a trillion) that our minister of finance has failed Canadians terribly.

I have said on this blog for a year that the impetus for a rate increase in Canada will be to curtail a credit bubble. Of course it will happen. Prepare now. — Garth

#116 Don on 04.06.12 at 2:50 pm

T.C. – Your friend rents a 2 bedroom house in Vic – I have noticed that house rental prices are coming down in Vic. Boomers have a limited amount of time before they need to move into some sort of assisted living, be it with family or with paid institutions. I will be waiting.

Coastal – Are you around the bear mountain region or downtown – I need to move to a two bedroom and am not willing to buy? I like that price range.

Ronaldo – thank you – I was only a teenager in the 80’s but that feeling of a crash has never left. I remember the effects – I’m getting the same feeling again.

How to stop my brother from buying in the fall??? I guess it is time to force the issue and make him read this blog and the news in general. It is not hidden anymore.

I feel for Heather – she should walk – give her children a better future.

Garth – as usual thank you and thanks for doing a special on Parksville/Qualicum – I am going home next week and will report more. I hear there are more and more listings on the same streets and house rents are falling even further.

#117 Westernman on 04.06.12 at 3:24 pm

Beach Girl @ # 73,
Yeah, the whole thing sounds like a freak show in the back corner of some travelling fair… you should fit right in…

#118 Westernman on 04.06.12 at 3:34 pm

Not 1st @ # 34,
It’s likely Garth won’t waste any time because Sask. in general and Regina in particular don’t matter and nobody cares…
No one wants to live there…

#119 LuckyRenter on 04.06.12 at 3:36 pm

Mark Carney willing to act if debt levels keep climbing

Bank of Canada governor said in an interview with The Canadian Press that he would be prepared to intervene if things got out of hand.

“In exceptional circumstances, if there are issues that threaten financial stability, such as household debt … the bank could use monetary policy for that purpose,” he said. “That factors into our decision-making without question.”

By Carney’s telling, the situation is not that far from reaching the point of exceptional circumstances. He is encouraged by the recent slowdown in the housing market. Household debt as a proportion of disposable income was close to 151 per cent at the end of last year. The Bank of Canada’s own analysis expects the ratio to approach the 160-per-cent level reached in the United States just prior to the 2008 financial crisis.

http://www.cbc.ca/news/business/story/2012/04/06/carney-household-debt.html

Here we go !!

#120 Sebee on 04.06.12 at 3:45 pm

If you believe 73% is statistically insignificant, you see things different than I. — Garth

I think it’s a valid point few commenters have. Look what happened to sales and values over 2011, both increased at 71% in this survey. Already a significant % of respondents.

#121 DM Kid on 04.06.12 at 3:58 pm

@ #90 Oaceanside – it should be noted that Sherry Cooper has since then bought a Toronto condo that is not only smaller than the house she just sold but is also more expensive!

You know this how exactly? — Garth

#122 The Thing in the Basement on 04.06.12 at 4:06 pm

“If you believe 73% is statistically insignificant, you see
things different than I. — Garth”

That’s not what Adam @106 said. It was the increase
from 71% that he said was insignificant. The 2% change
falls within the error margin of must surveys.

A better figure for comparision would be the historical
percentage.

Count the fairies on the pinhead all you want. When 73% of the population eschew buying it is meaningful. The market is being led higher by an increasingly smaller squad of fools. Surprised you cannot see this. — Garth

#123 Market Bull on 04.06.12 at 4:15 pm

Canadian Watchdog wrote:

“To my point which you missed; with the average home selling below 30 days on the market, the bank can sell the property (flip whatever) within the time frame of 60-90 days. That is why 90 day arrears is more of a buffer or indication of power of sales that have not been sold.

Get it? Good. So next time shut your mouth before you try to discredit me again.”
_____________________________________________

You have just proven yourself an imbecile. Equating days on market with mortgage arrears is hysterical.

You failed to answer the question. Where does the CBA 90 days in arrears data come from, if the banks are selling all the default properties before 90 days?

#124 zeeman on 04.06.12 at 4:17 pm

Garth,

Carney is all talk….he has been saying this for a very long time but scared to do anything……same for F….he talked and talked but did nothing when he could have with the majority govt…..same will hold true for OSFI, heard the Super talk on Friday and from the way she spoke she will do nothing……so the beat goes on……

rates are going no where….usa job numbers are below expectations and this will mean QE3 is back on and bonds rates will drop resulting in low rates staying longer….

#125 The Thing in the Basement on 04.06.12 at 4:18 pm

113 Watchdog – tracing back the comments regarding this 90 day arrears, I have to disagree with your logic.

I will assume your explanation of the power of sale is
correct. However, if POSs are selling that quickly, they would not present any significant indication of a falling market or recession. The longer 90 period would be a much better indicator.

#126 Deb on 04.06.12 at 4:20 pm

As always, it is the immediate, draining impact on the pocketbook that can quickly change a person’s general financial perception. Once again, for many Canadians, that regular trip to the local gas station may become a time to reassess priorities and focus on the big picture, which may include real estate.

The coming OSFI changes and the spectre of rising interest rates are several months away, and most folks just can’t estimate what the overall impact will be (even though personal stress tests of the latter are easy to do and actually quite helpful in planning).

But this week, all I am hearing is the shock and dismay at rising gas prices. And just in time for the Easter long weekend! People are already starting to talk about cutting back on driving, switching to a smaller vehicle, planning summer vacation time for short trips only in their home province, ect.

Most of us have seen this movie before, but the impact from extreme gas price increases the near future will be phenomenal. And it is rising energy prices, I would argue, which will be one of the most important social psychological constructs to fuel the rapidity of the national real estate correction, which has already begun to occur in several localities. In other words, even though the real distance will not have changed, soon the suburbs and bedroom communities are going to seem further and further away from the core.

Don’t. Do. It. Indeed.

#127 Superman on 04.06.12 at 4:20 pm

Once this house crash begins it will be a long and hard crash. We will all look back and wonder how 1 bedroom condos ever sold for $550k in DT vancouver. End of story.

#128 The Thing in the Basement on 04.06.12 at 4:27 pm

“Count the fairies on the pinhead all you want. When
73% of the population eschew buying it is meaningful.
The market is being led higher by an increasingly smaller
squad of fools. Surprised you cannot see this. — Garth”

A statistically insignficant change in one year. You need
to show years of data to establish the trend and
calculate an historical average. Surprised you do not
understand this.

#129 Adviser on 04.06.12 at 4:29 pm

#95 daystar on 04.06.12 at 12:51 pm

Great post, enjoyed reading it!!

#130 Finanzkrise on 04.06.12 at 4:36 pm

This Vancouver story of joint-mortgages smells like Tokyo circa 1988…

http://www.vancouversun.com/business/Joint+mortgages+help+increase+buying+power+come+with+complexities/6418588/story.html

#131 Mark The Talk Carney on 04.06.12 at 4:52 pm

#119 lucky renter

Mark the talk carney is a financial criminal who has created the biggest housing ponzi scheme in canadian history. He is lucky Canada Is a fascist country where corporate financial crimes such as the housing ponzi isn’t a criminal offence. Mark will talk until the ponzi crashes and he bankrupts Canada much like helicopter Ben did to the US. The scary part is canada has a bigger bubble then the US. Keep talking mark carney you useless CRIMINAL.

#132 Timbo on 04.06.12 at 4:56 pm

http://www.capitalspectator.com/archives/2012/04/march_paryolls.html#more

“Hopefully, income growth will accelerate as the labor market improves. Otherwise, households will need to take on additional debt or running down saving rates to hold the current trend in place.”

http://www.economonitor.com/blog/2012/04/job-growth-slows-sharply-in-march/?utm_source=rss&utm_medium=rss&utm_campaign=job-growth-slows-sharply-in-march

“It is obviously disappointing,” says Cliff Waldman, a senior economist at the Manufacturers Alliance for Productivity and Innovation. “This provides some pretty good evidence that part of the strength of the prior two months was probably seasonal.”

This is not over quite yet people. High gas prices and poor wage growth will not bring along a full recovery. Hopefully Canada’s neighbor just floats around the border of recession never quite sinking too far into the negative.

#133 SHUT UP Mark Carney on 04.06.12 at 4:58 pm

Will this clown just shut up? Nobody cares what you say. You are a useless eater and worthless to society. Why are you even here in Canada…what is your job. You like to talk and do nothing. A monkey could do your job and it would cost taxpayers $500 a year in bananas.

#134 daystar on 04.06.12 at 5:14 pm

I have said on this blog for a year that the impetus for a rate increase in Canada will be to curtail a credit bubble. Of course it will happen. Prepare now. — Garth

Exactly. The only question mark is when. F & H won’t do anything, thats obvious enough. Readers need to realize precisely why it is that the BoC should raise interest rates to halt the growing risk of household debt only as a last resort and its right there at the beginning of this link:

http://money.ca.msn.com/investing/news/business-news/carney-would-act-on-housing-debt-in-emergency-2

Mortgage holders aren’t the only ones who borrow money. Governments and businesses large and small do as well so the moment rates go up, its the moment borrowing costs go up not only for mortgage holders but for everyone else under the sun. It not only hurts an economic recovery from recession as borrowing costs rise, it puts a damper on growth and most importantly, productivity in this nation which is precisely why raising interest rates to put a halt on household credit growth is so costly.

Why would Mark Carney raise interest rates to curb growing household debt at the expense of our businesses and push government borrowing costs unnecessarily when F could so easily pop our household debt issues through CMHC? Or for that matter, OSFI or a combination of both?

Mark Carney has been ringing alarm bells with growing household debt on deaf ears for years. F & H won’t listen so what are his choices? Take the message to the masses to slow down consumer credit growth and it that doesn’t work and F does nothing (as usual) and rates don’t go up south of the line forcing rates to go up regardless, Mark will be forced as a last resort to do it himself.

If Mark Carney is truly pushed to the brink of raising rates for the sole reason of putting a halt to household debt in this nation its just another clear cut example of our Harper government wrecklessly damaging the economy through doing everything they can to encourage consumers to dangerously borrow their brains out.

So why would they do it? Why would F & H purposely run up household debt to where its the number one threat to our economy? Incompetance. Immorality, a lust for power and self interest… treason perhaps… but the result is the same. Its grossly failed Harper government policy on housing no matter how one looks at it and by the time everyone finally and fully catches on, its far too late. Lock into 10 year terms readers and maybe… just maybe you won’t the 1 in 10 (or more) that gets crushed by what’s to come.

#135 Timbo on 04.06.12 at 5:19 pm

http://marcfaberblog.blogspot.ca/2012/04/cnbc-video-dr-doom-forecasts-massive.html

Now there is a video of doom.
50% loss in my opinion is way over the top but I thought I would share it will the bears.

But on a good note for Canada depending on your take..

http://www.arabianmoney.net/us-dollar/2012/04/06/us-losing-its-competitive-edge-explains-professor-niall-ferguson/

#136 Uh Oh Canada on 04.06.12 at 5:32 pm

Lent- a new holiday to memorialize all those who have been ‘lent’ money excessively and are over their heads in debt. They remain in a position of being lent for many years.

#137 DM Kid on 04.06.12 at 5:35 pm

Garth, take a look at this month’s North Toronto Post. In the article “Real Estate Issue 2012 Roundtable” Sherry mentions she paid more for her condo than she got for her house “… and it’s much smaller, of course.”

Wow. Must be true. — Garth

#138 dd on 04.06.12 at 5:45 pm

#95daystar

Do the math Daystar. The fed is buying over 50% of the Treasuries bonds – this is easy money policy. Furthermore the US want a cheap dollar – it is trying to drum up export jobs.

QE through the front of side door. Gold is moving towards the system and not away.

Ha, ha. — Garth

#139 dd on 04.06.12 at 6:01 pm

US needs to generte 260K jobs a month to breakeven. This latest jobs reports is 1/2 the amount. The US is actually falling behind.

Lets “play up” jobs numbers this time!

http://www.zerohedge.com/news/us-needs-generate-262k-jobs-each-month-get-back-breakeven

#140 Timbo on 04.06.12 at 6:02 pm

http://timiacono.com/index.php/2012/04/06/and-now-for-something-completely-different-2/

totally off-topic Garth but here is a plane being built over eight days in an 2 1/2 high speed video. Housing being built with time lapse be-damned.

#141 Harlee on 04.06.12 at 6:04 pm

#89 Mikey He’ll Eat Anything
Don’t pick on Beach Girl ! She leads an interesting life and as far as I’m concerned has every right to post here. A little “off topic” at times,but so what ? All of this doomer talk gets a little boring at times and BG’s posts are a great break from that. This message goes for that guy at #117 too. You’re just a couple of maroons….

#142 dd on 04.06.12 at 6:04 pm

Gold is moving towards the system and not away.

Ha, ha. — Garth
———————————————————-
Right on the front page Garth:

“lawmakers from 13 states, including Minnesota, Tennessee, Iowa, South Carolina and Georgia, are seeking approval from their state governments to either issue their own alternative currency or explore it as an option. Just three years ago, only three states had similar proposals in place”

http://money.cnn.com/2012/02/03/pf/states_currencies/index.htm

Only you and a bunch of anti-gooberment Tea Party knuckledraggers would get excited about this. What tripe. — Garth

#143 Ret on 04.06.12 at 6:15 pm

Julie Dickson, top banking regulator at OSFI, on BNN yesterday at 1:00 pm.

Sorry I can’t get the link to post. When asked about CMHC and what she was going to do about the this plan, she said that this is a political program and not her gig.

Over to you F. It doesn’t appear that she is going to do the dirty work for F on this one.

#144 Mr Buyer on 04.06.12 at 6:15 pm

I wonder how successful our elites would have been pulling these shenanigans in say 1948 or 49 with society composed of the likes of these characters…
http://ca.news.yahoo.com/blogs/dailybrew/canadian-veteran-famed-devil-brigade-dies-within-hours-204426389.html

#145 Blog Dog Carney on 04.06.12 at 6:24 pm

Daystar – thank you for your efforts in explaining to some of the bloggers the difficult, precarious situation we are in and how contradictory in approach the objectives can be. We did suffer much of the fallout from the financial crisis, including a small correction in the housing sector. However, the difficulties faced by many of our trading
partners continues to influence interest rates worldwide. Unfortuneately, despite my warnings, some Canadians
have taken on too much household debt.

We must proceed cautiously. I am encouraged by the recent job numbers. If they continue, I will start raising the BOC rate incrementaly. I ask for everybody’s patience on this. Thank you Garth for allowing me this blogspace. Happy Easter. We’ll go riding soon, K?

#146 Canadian Watchdog on 04.06.12 at 6:29 pm

#123 Market Bull

Who said all? In the case for Ontario (that makes up the largest share of the property market in Canada), the average DOM is 21 days for GTA properties, meaning, after 60 days of a default, the bank will list the property with a high probability of it being sold before 30 days, or within the 90 day window. If it’s sold, it does not go into arrear stats. CBA stats are pending properties that are still listed or not fully claimed with CMHC.

And since you persist that I stupefy you again with charts, look below to see why Ontario’s arrears (a power of sale province) has recovered while foreclosure provinces have not.

BC http://i43.tinypic.com/xds9sl.png
AB http://i43.tinypic.com/2h50bpl.png
ON http://i39.tinypic.com/qzr9le.png

The foreclosure process takes much longer to liquidate homes, while a power of sale can be liquidated immediately, making it easier for the banks to offload properties. If that’s not enough, also know that CBA revisions include the removal of mortgages that have closed, and also mortgages that have been pooled/sold to MBS investors. These titles are transferred to CMHC on behalf of investors.

If you’ve been using CBA stats as your indicator for a market crash, sorry, you’ve been duped like many others.

#147 wheredideverybodygo? on 04.06.12 at 6:45 pm

Again curious with the gas prices and if they could be the canary in the coal mine or the actual cause of the gas leak… Here’s a handy chart by gas buddy that tracks it, change the spec’s to 8 years and compare toronto and the US and see where the spikes and drops are.
http://gasbuddy.com/gb_retail_price_chart.aspx

Could be a fluke or one causes the other, but the trend fits comfy with when they had to goose interest rates and where housing tips -either up or down -happened. So I am very interested to see the results when and if we hit $1.50L.

#148 Westernman on 04.06.12 at 6:46 pm

Harlee @ # 141,
Your white knighting of Beach Girl puts you in the catagory of Mangina…
You are a perfect example of the sad, sad state Canadian ” Men ” ( and I use that term loosely ) are presently in…
Get a backbone, grow a pair and stop sucking up…

#149 P & T S on 04.06.12 at 6:54 pm

#114Investx on 04.06.12 at 2:36 pm
Why rent if you can put down a sizable down payment (the traditional non-sublime 20 – 25%) and build equity with mortgage payments that are not any higher than the cost to rent?

____________________________________________

Right now it’s better sense to invest your 20 – 25% deposit and let the income from that offset part of the rent you pay. In the future it may very well be VERY cost effective to buy, but not right now.

“Gaining equity” in a falling RE market will be quite an achievement. We wish you luck in this venture.

#150 daystar on 04.06.12 at 7:00 pm

Lol, this is a funny blog Garth. Obviously enjoying being a part of it. ;)

Happy Easter weekend everyone!

#151 eddy on 04.06.12 at 7:15 pm

Carney only makes 500K? I recall reading an interview, shortly after he was installed, where he said he was taking a pay cut to be here. He said he took the job becaue he felt a compelling urge to serve.

#152 Daisy Mae on 04.06.12 at 7:19 pm

#112 TRUTH HAMMER: “Marco…you’re not worth the $500,000 a year we pay you…”

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

After arguing with a council member over the replacement of a dead tree…I am angry. Then I read your post and got even more disgusted! LOL I agree. Carney has been keeping a low profile so he doesn’t get shown the door by Harper. WHERE is the opposition? WHY aren’t THEY doing THEIR job? Why aren’t we having a vote of non-confidence?

#153 len on 04.06.12 at 7:25 pm

AnthEmic

I don’t normally post but wanted to make a quick response to your post – right on…

The concerns of the productive class (not the rentiers class) are not really addressed here.

Our family has taken the approach of not propping up the system by removing our savings from it. It is a cynical system that skims… we have no interest in this useless churn

Solid relationships trump all the endless greed and money for nothing attitude.

Take care

#154 Onemorething on 04.06.12 at 7:29 pm

#114 Investx on 04.06.12 at 2:36 pm

Why rent if you can put down a sizable down payment (the traditional non-sublime 20 – 25%) and build equity with mortgage payments that are not any higher than the cost to rent?

This better be your first visit to this blog! If you need answers bookmark this page and read it everyday!

Maybe you can be saved!

#155 Claudius Emperor on 04.06.12 at 7:31 pm

http://ca.finance.yahoo.com/news/mark-carney-says-intervene-housing-130558908.html

————
Private sector economists are almost unanimous in the view that housing prices are too high in Canada in relation to fundamentals, such as incomes and the cost of renting. That suggests a correction is coming, in the neighbourhood of 10 to 25 per cent, with some hot markets like Vancouver and Toronto possibly facing an even bigger reckoning.
———————
I bet on 60 percents drop in GTA. I am normally a moderate optimist.

#156 jess on 04.06.12 at 7:33 pm

downplaying –
reframing bubble to a balloon minus the pin

Finance Minister Jim Flaherty has tried to deflate the housing “balloon ” three times in the past six years by tightening mortgage lending rules.

….one must first put a bit of of lubricant on the least stretched part of the balloon (by the knot) to reduce the friction produced by inserting the pin. This will deflate the balloon without popping. Assuming that the balloon wasn’t fully inflated.

Does Mr. Carney have the pin?
” Mark Carney willing to act if debt levels keep climbing.”
http://www.cbc.ca/news/business/story/2012/04/06/carney-household-debt.html
============

Households listen Up!
Remarks by Chairman Alan Greenspan
Understanding household debt obligations
At the Credit Union National Association 2004 Governmental Affairs Conference, Washington, D.C.
February 23, 2004

http://www.federalreserve.gov/boarddocs/speeches/2004/20040223/

#157 Beach Girl on 04.06.12 at 7:53 pm

Hi Harlee

Thanks for your support, Westerman and Mikey the Retard or Realtor (can’t remember) are probably very lonely men. You can sense the anger. The pent up anguish, among other bodily fluids, the lack of friends.

The shear knowledge that you are a dork and no one likes you, so you try to appear superior, when if fact you are dying inside.

I feel for you (NOT) LOL. Get a life, make some friends. Happy Easter.

This one is going to be the BEST.

The next party is going to have a Bollywood theme, as Jay the gas station man seems suicidal. The Indians all seem to Dance Like Jagger. Already planning that one.

Have fun everyone. Don’t buy a house. LOL.

#158 Beach Girl on 04.06.12 at 7:55 pm

Just in fun, the only balls Westerman is dragging are probably behind his pickup.

#159 KingBubbles on 04.06.12 at 8:11 pm

In case it was nnot posted already

http://www.cbc.ca/news/business/story/2012/04/06/carney-household-debt.html

#160 Westernman on 04.06.12 at 8:27 pm

Beach Girl,
How long do they allow you use of the computer at the sanitarium…?

#161 notafollower on 04.06.12 at 8:33 pm

Garth,

I don’t own a home and I’m really bearish on real estate particularly in Vancouver. So I’m in sync with your spin on this however what are your apologetics on the following typical analysis: (in my words)

Mainland Chinese – the cash rich wealthy ones already have cash and are looking for “safer” places to put their money.
Vancouver is the #1 foreign place to visit and invest for wealthy chinese.
Even if China busts and even goes into recession there are still Chinese cash buyers looking to invest and secure themselves outside China and Vancouver is the place to do it.
1% of a 1.6 Billion Mainland Chiness are more than enough to continue to pump up Vancouver blah blah blah

I’m not a realtor is does NOT suit me for prices to go up further in Vancouver, in fact it would suit me for prices to collapse here (which I believe they will do).

But the above scenario that I discribed is totally possible as well – can you address it specifically and articulatley kill it, or no?

I’d like to hear your specific spin on those typical issues.

notafollower

Blame the idiot citizens of Vancouver, not the new idiots. — Garth

#162 Mr Buyer on 04.06.12 at 8:41 pm

#145 Blog Dog Carney on 04.06.12 at 6:24 pm…including a small correction in the housing sector. However, the difficulties faced by many of our trading
partners continues to influence interest rates worldwide. Unfortuneately, despite my warnings, some Canadians
have taken on too much household debt.
…………………………………………………………………….
To sum up, correction is over, global concerns govern our interest rates and your government had nothing to do with turning the taps of easy credit on and leaving them running up this bubble. Tripe, total tripe. Your party will pay dearly for this blight brought on by your policies. Just imagine sound bites like so next election, the Conservatives changed CMHC policies and lowered interest rates, cross fade to families dumping 70 to 805 of there salaries into their mortgages, How could they do this when they saw what happend to America? There will be no more reform parties or any conservative parties in power for generations. Do not let your political consultants con you, you guys are finished. There will be no shifting the responsibility to the banks or the Canadian people. This was an act of policy and easily condensed into a sound bite.

#163 Ronaldo on 04.06.12 at 8:42 pm

#143 Ret – ”Over to you F. It doesn’t appear that she is going to do the dirty work for F on this one.”

They are just playing this game:

http://www.siasat.pk/forum/showthread.php?99910-Passing-the-Hot-Potato-Chinese-Army-Style-Must-Watch

#164 Mr Buyer on 04.06.12 at 8:45 pm

PS. Lets go riding sometime.

#165 Mr Buyer on 04.06.12 at 8:59 pm

A big part of the fallout from the RE bubble in Japan is political instability. Allegiance to a political ideal or party is no longer assumed.

#166 Investx on 04.06.12 at 9:03 pm

Onemorething on 04.06.12 at 7:29 pm
#114 Investx on 04.06.12 at 2:36 pm

Why rent if you can put down a sizable down payment (the traditional non-sublime 20 – 25%) and build equity with mortgage payments that are not any higher than the cost to rent?

This better be your first visit to this blog! If you need answers bookmark this page and read it everyday!
________________________________________

Care to elaborate?

If it’s because you’d be gaining equity in an asset that will fall in the near future, isn’t that at least better than having no equity at all with renting? And, you have a chance of the asset appreciating when the market rises again if you’re still holding the property.

I’m all ears (eyes).

#167 jess on 04.06.12 at 9:05 pm

By STEVE EVERLY
The Kansas City Star Read more here: http://www.kansascity.com/2012/04/05/3539129/three-big-oil-companies-agree.html#storylink=cpy

..”As a liquid, gasoline expands and contracts depending on temperature. The volume of fuel is pegged to a 60-degree standard, at which the 231-cubic-inch American gallon puts out a certain amount of energy. But if the temperature of that gasoline rises to 90 degrees, it expands to more than 235 cubic inches. But at the pump, consumers still get only 231 cubic inches.Put simply, every degree over the 60-degree standard diminishes the energy a 231-cubic-inch gallon delivers to the nation’s fleet of cars, trucks, boats, buses and heavy equipment — and forces drivers to consume more and thus pay more for fuel.

Gasoline and diesel expand in warmer months, so a gallon of fuel contains less energy than what consumers pay for at the pump.
In a series of stories in 2006, The Kansas City Star estimated that hot fuel cost consumers $2.3 billion a year, a price tag that is now roughly $3.5 billion at current gasoline and diesel prices.
After The Star’s stories, class-action lawsuits accused dozens of companies, from oil giants to fuel-station chains, of being involved in the practice. Read more here: http://www.mcclatchydc.com/2012/04/06/144416/three-big-oil-companies-agree.html#storylink=cpy

The lawsuits seek a remedy such as retrofitting pumps so that they would automatically adjust volume of a gallon of fuel depending on the temperature, which has been done for decades in Canada.

Read more here: http://www.mcclatchydc.com/2012/04/06/144416/three-big-oil-companies-agree.html#storylink=cpy

#168 notafollower on 04.06.12 at 9:12 pm

Garth…um thanks for responding above – I was hoping for some actual quality rebuttle (for me) and so I can share with others who always bring up the same points with me when I tell them the bubble is going to burst.

I get that we are the most expensive city in the world for real estate using affordability index and that our household debt ratio is approaching USA 2008 level per crash, but that doesn’t answer the “Chinese”‘issues I mentioned above.

Have you dealt with this in another article? Or can you do a specific post that explains why the Chinese factor is not going to cinque to prop up the market.

Sure

#169 T.O. Bubble Boy on 04.06.12 at 9:14 pm

#121 DM Kid

it should be noted that Sherry Cooper has since then bought a Toronto condo that is not only smaller than the house she just sold but is also more expensive!

You know this how exactly? — Garth

Garth – this was stated by Sherry Cooper in the Post City Magazine real estate roundtable that you missed… She said that her new condo cost more than her house.
(now, maybe that just means more than the *original* cost of her house, but she definitely stated it in a way that suggested she just went in for $3M+ on some Toronto condo)

Try per square foot. — Garth

#170 notafollower on 04.06.12 at 9:17 pm

Garth (a followup)

Btw, I’m not blaming wealthy Chinese (or anyone for that matter) for pricing everyone out of Vancouver – even if that were true – I don’t care, I’m a free market believer.

But I’m still interested in understand why the “wealthy chinese with cash” argument will not keep the Vancouver market going.
I would be happy to replace “wealthy Chinese” with another phrase but its the one that most realisticly describes what can continue even if other markets start to collapse.

sure

#171 Spiltbongwater on 04.06.12 at 9:22 pm

Blame the idiot citizens of Vancouver, not the new idiots. — Garth

I think you are mad today Garth.

#172 daystar on 04.06.12 at 9:22 pm

#145 Blog Dog Carney on 04.06.12 at 6:24 pm

Thanks! That means alot to me and I’m honored and most welcome to assist! I’m a strong admirer of your work and efforts by the way and glad to have you as governor of the BoC.

#129 Adviser on 04.06.12 at 4:29 pm

Thanks and you’re welcome. :)

As for these entries below by one or two individuals who for some reason wish for tax increases, reduced business profit and unemployment over the proper identification of the root of the problems we face in housing (void of manners too, how were you raised?) …

#124 zeeman on 04.06.12 at 4:17 pm
#131 Mark The Talk Carney on 04.06.12 at 4:52 pm
#133 SHUT UP Mark Carney on 04.06.12 at 4:58 pm

Thankful… not so much. How to be civil about this… hmmm… practice this mantra successfully and you may yet escape what you otherwise so richly deserve:

http://www.youtube.com/watch?v=OM9b3uUQ2zI&feature=results_video&playnext=1&list=PL2EAC9B2D9E828956

While we are on the subject of Pop songs, I’ve got a song all picked out for Stephen Harper to learn…

(suits him) :)

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

Rated PG (some foul language in the last 10 seconds of the song so heads up)

#173 brainsail on 04.06.12 at 9:24 pm

There is alot of goodness in the latest US employment numbers!

“March’s underemployment rate is the best reading since just before President Obama took office in January 2009.”

“Fewer frustrated baristas: Much of the improvement came because the number of workers who want full-time jobs but who are stuck working part time fell by 447,000 to 7.6 million. It’s the sixth-biggest monthly drop on record.”

http://money.cnn.com/2012/04/06/news/economy/jobs-report-underemployment/index.htm?iid=HP_LN

#174 Timbo on 04.06.12 at 9:31 pm

notafollower

Investment means a rate of return. Rents cannot give you that return in Vancouver, only speculating on a greater fool to buy at a future higher value.

The US in many markets does give you that return now. The asset price might not move up much but the rental income realized is much higher with the same amount of capital tied up. Prices should go down a little more but it is close to bottom. Vancouver is going to get pummeled, stay away.

Investors are not stupid, they invest in rising prices and get out leave when things turn downward.

#175 disciple on 04.06.12 at 9:31 pm

#83 Mike Rotch… I disagree concerning Apple. They are light-years ahead of everyone else, both in terms of innovation and just plain old cash. They don’t have to stick with smartphones, they could be making automobiles or 3D printers or God-knows-what in the next decades, and the rest of the imitators still wouldn’t know what blew past them… again… For a long time I didn’t understand the appeal, but I luckily discovered that Apple is more than a tech toy company, it is a revolution. I bought in a long time ago when I discovered the iPod. Glad I did… quintupled my investment…is that a word?

#176 dd on 04.06.12 at 9:41 pm

Paul Krugman: Not enough inflation (MONEY PRINTING)

“would a rise in inflation to 3 percent or even 4 percent be a terrible thing?”

WOW … the main reporter for the Fed wants to see 4% inflation. But you know the govenment always fks things up. It could easy be double this.

http://www.nytimes.com/2012/04/06/opinion/krugman-not-enough-inflation.html?_r=1

#177 Mr Buyer on 04.06.12 at 9:47 pm

#166 Investx on 04.06.12 at 9:03 pm
And, you have a chance of the asset appreciating when the market rises again if you’re still holding the property.
……………………………………………………………………
Now you have done it. You said the IF word. Now the great pumpkin will not come.

#178 Blog Dog Carney on 04.06.12 at 11:03 pm

162 Mr Buyer – Though I am appointed to the BOC board
for three years, it is the directors who elected me
governor. My seven year term started in ealy 2008. If the
finance minister is extremely unhappy with my work, he
can ask for a change in bank policy. You can read more
here:

http://www.bankofcanada.ca/about/faq/

The low interest rate environment was already well established by the previous governor, Mr. Dodge. My term started just before the GFC. I too am frustrated by the current economy. It is not normal by any stretch. We must however recognize all the forces at work, and the role that the BLC plays.

A ride? Certainly.

Mr. Daystar – feel free to examine the “careers” page at the BOC website.

#179 daystar on 04.07.12 at 1:06 am

#178 Blog Dog Carney on 04.06.12 at 11:03 pm

Thanks for the suggestion. I’ll look into it. ;)

#180 Beach Girl on 04.07.12 at 5:15 am

#160 Westernman on 04.06.12 at 8:27 pm

Beach Girl,
How long do they allow you use of the computer at the sanitarium…?

_____

That’s funny, as I volunteer at Whitby Shores. You really do think you are superior.

Was trying to get Miss Daisy to be a visiting dog in a Pallative Hospice or Old Folks home, but she is too nasty. All my friends volunteer.

I had a good friend Alice. She died last fall at 97. We used to bring her to the pool parties, put a hat on her, and duck tape her to the lawn chair, so she wouldn’t slide off.

Skinny thing could eat. From some Slovakian Republic crap place. Had her first dime. Used to hit the dog when she thought we weren’t looking.

Westernman, go help someone, you might make “A” friend and have some fun.

Happy Easter, I am getting stoked. This is going to be fun.

#181 Daisy Mae on 04.07.12 at 9:49 am

#156 JESS: “Finance Minister Jim Flaherty has tried to deflate the housing “balloon ” three times in the past six years by tightening mortgage lending rules.”

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

You mean he’s been trying to rectify the mistakes HE

#182 Daisy Mae on 04.07.12 at 9:52 am

I’ll try again…

#156 JESS: “Finance Minister Jim Flaherty has tried to deflate the housing ‘balloon’ three times in the past six years by tightening morgage lending rules.”

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

He”s been trying to rectify the mistakes HE alone made within the past few years. That’s ALL he’s been doing. And now he’s trying to pass the buck. Let’s be honest!

#183 Arse on 04.08.12 at 11:17 am

Happy Easter!!!