America

There’s no way they can afford a house in Vancouver. So they covet one in Washington State.  That makes them just like apartment-dwellers in the GTA who dream of a $65,000 condo in Florida. “We’d be happy to own something, anything,” Jenn says, “even if it’s a thousand miles away and some trucker’s living there, paying us peanuts.”

The gulf between Canadian and American real estate has turned into a yawning canyon, as US prices continue to erode, while ours swell uncontrollably. Throw in a loonie at par, and it’s just too much. This is why realtors in Phoenix and New Smyrna Beach fly Canadian flags. Man, do they love us.

So, is this a good idea? After all, this internationally horny yet oddly pathetic blog has mentioned a few times the logic of selling Canada and buying America. Is it time?

First, the latest news: American house prices continue to go down. The annual decline, as measured by the Standard & Poors/Case-Shiller index is now 3.5%. So housing in general has lost about a third of its value and in some markets (like most of Arizona) up to 70%. But this latest drop is being interpreted as positive news – since it’s less than the 3.9% erosion in the last period. And new home sales in March were 7.5% better than the same time a year ago. Hell, there are even bidding wars breaking out in some cities.

News like this has many stock market investors convinced US housing is forming a bottom. That’s one reason the shares of major homebuilders bounced higher on Tuesday. And this week the Fed will reinforce once again that mortgage rates – now close to all-time lows – are going nowhere.

Meanwhile, here’s a major Canadian bank getting into the act. Impeccably timed to correspond with the latest numbers, BeeMo has a new report telling people “now is likely a good time to buy U.S. real estate in regions with relatively low foreclosure rates, as conditions should improve enough to put a floor under prices this year.”

Written by senior pointy-head Sal Guatieri, it claims prices are likely to stabilize within a few months, demand for housing will surely increase as the US economy motors ahead, and houses are practically being given away.

“With mortgage rates at record lows and resale prices down 34% from the peak, only 12% of gross median family income is needed to finance the purchase of a typical house – nearly half the long-term norm,” he enthuses, with words that make Jenn weak and lusty. “In fact, it’s cheaper to own than rent in many regions.”

BeeMo actually has new numbers showing the pull of US prices on bidding-war-weary Canucks: 16% of us are ready to buy now; 56% would do so to get a cheap vacation home; 44% are smitten because America’s cheap; and a third think this is a good investment move.

Of course, if, like Jenn, you’re hot to buy, then here’s a coincidence – Bank of Montreal will give you a mortgage! Check out this selfless corporate news release:

“Canadians looking to buy U.S. property should consider partnering with a U.S. financial institution, preferably a Canadian-based bank with branches south of the border, to finance the new purchase,” said Laura Parsons, BMO Mortgage Expert. “For real estate, having expertise at the local level is always the best approach, as conditions and trends can vary drastically from one location to the next.”

Ms. Parsons noted that BMO customers can visit a BMO Harris Bank branch in the U.S., which has locations in Illinois, Indiana, Arizona, Florida, Minnesota, Missouri, Kansas and Wisconsin. “Having a Canadian partner can provide a clear understanding of the differences between Canadian and U.S. financing, which can save a lot of time and headache during the home buying process,” added Ms. Parsons.

Flogging US properties to Canadians who gag at the prices has become a big business. Any night of the week, in any big city, you can find an American shill at work in a downtown hotel ballroom telling you to buy hard, and buy fast.

“The window of opportunity for USA real estate may be extremely limited in the very near future,” says John Chin, of the US Investor Network – an outfit which kicks off a series of six seminars in Toronto beginning tomorrow. The events are free, but the process isn’t. What Chin doesn’t tell his Canadian audiences is that he’s the mastermind of a company called (what else?) Mastermind Real Estate Group which has turned into a veritable rental property machine. He advertises the process to real estate agents thusly: “We handle the entire sales process from initial Q&A to closing to follow-up. Closings typically occur within 30 days of lead procurement. Then, upon closing, a referral check is sent to your broker.”

Thirty days from going to a free seminar in Winnipeg to being a landlord in Orlando, of a property you’ve only seen on the Internet?

Whoa. Way too fast. This is exactly why a slew of Canadians are going to get their butts kicked by rube Americans too dumb to buy their own cheap houses because they’re all subprimates. While US houses are at low tide, there’s big risk involved in snapping them up without knowing what you’re doing. And most people don’t.

I will revisit this topic in a couple of days. In the meantime ask yourself a question: If it’s so easy to buy dirt-cheap houses and rent them out for profits, why aren’t the Yanks doing it? I mean, they invented Apple and Viagra, so what gives?

In the meantime, do not go to the Intercontinental Hotel on Front Street in Toronto on Thursday at 3 pm. Whatever you do.

167 comments ↓

#1 TurnerNation on 04.24.12 at 8:51 pm

2nd?

#2 Gta boy on 04.24.12 at 8:52 pm

First…….

#3 Publius Enigma on 04.24.12 at 9:07 pm

US real estate will not truly rebound until shadow inventory is cleared.

Fools have been proclaiming a “bottom” in US prices for two years. Yet prices continue to fall. And will continue to fall, until the shadow inventory clears.

Then, and only then, you will see a recovery. By that time there will be some markets where 90% of the value has been lost vs peak.

#4 boko on 04.24.12 at 9:09 pm

Lazt!

#5 Dontcallmeshirley on 04.24.12 at 9:21 pm

Garth doesn’t like to endorse individual stocks, but this post gives compelling reason to hold a bank or two doesn’t it?

Whatever comes next, banks will flourish. Grab a piece for yourselves.

#6 Nick on 04.24.12 at 9:26 pm

It seems Bank of Canada is finally serious… It will hike key rate soon:

http://business.financialpost.com/2012/04/24/carney-house-price-to-income-ratio-outstrips-norm-by-35/

http://business.financialpost.com/2012/04/24/bank-of-canada-warns-again-interest-rate-hike-may-be-needed/

However, it’s too late for a soft landing…

#7 Freedom first on 04.24.12 at 9:29 pm

Great post Garth! Yes, reminds me of one of my favourite sayings, “Ignorance is extremely expensive.” I am continually amazed at the number of otherwise intelligent people, who are smart enough to amass money from a relatively good income they receive from acquiring knowledge, and then, blow the wad without knowing what the hell they are doing!

#8 Paully on 04.24.12 at 9:37 pm

“In the meantime, do not go to the Intercontinental Hotel on Front Street in Toronto on Thursday at 3 pm. Whatever you do.”

Wow, that kind of makes me want to go, to see why it would be so bad for me to go…

#9 Dan from Richmond Hill on 04.24.12 at 9:38 pm

#3Publius Enigma on 04.24.12 at 9:07 pm

What do you mean by “shadow inventory”?

#10 Smoking Man on 04.24.12 at 9:40 pm

#163 TurnerNation on 04.24.12 at 7:59 pm
Smoking man I did not see you at Duke of Devon tonite.

Waiting for Patio weather.

#11 Smoking Man on 04.24.12 at 9:46 pm

Going to make free of charge for a couple of days a neet tool I made. Was Board on Sunday.

It allows you to enter TIC’s for up to ten stocks, then scans google every 30 seconds for breaking news on the tics. It’s cool

For those of you who can’t afford bloomberg at 2K a month.

I wana make one of you track 6ers rich on day.

I will put up a link after I test it a bit more.

Keep tuned to Garths bat channel

#12 X on 04.24.12 at 9:53 pm

http://www2.macleans.ca/2012/04/23/the-under-the-radar-changes-that-may-soon-deflate-or-pop-the-housing-bubble/

#13 Stupesing in Cabbagetown on 04.24.12 at 10:03 pm

You know, of course, that a whole bunch of people will show at the Intercontinental Hotel on Front Street in Toronto on Thursday at 3 pm because they read about it here first.

#14 Snowboid on 04.24.12 at 10:05 pm

Once again, the wise Professor has outlined the pitfalls of trusting those who look to sell us snake-oil.

Although we met a few Canadian ‘investors’ down south, all of the ones we know as neighbours in the NW valley of Phoenix paid cash and bought these winter homes not as investments, but as inexpensive ‘winter retreats’.

So we are part of the 56%, plus the smitten 44% because know first-hand how much less expensive it is during our winter stays down south.

Those that have an eye on US real estate as a pure investment are well-advised to carefully research the tax/capital gains and estate implications.

#15 East Van on 04.24.12 at 10:05 pm

http://www.nytimes.com/2012/04/25/business/global/cost-of-spains-housing-bust-could-force-a-bailout.html?_r=1&ref=business

#16 a prairie dawg on 04.24.12 at 10:08 pm

Capitalist Dogs!

#17 Intuitive Missus on 04.24.12 at 10:13 pm

#9 Dan from Richmond Hill.
Shadow inventory.

http://www.investopedia.com/terms/s/shadow-inventory.asp#axzz1t0v0unN6

Garth, look forward to your blog daily. Sold last June and renting. Bought nice little place in the Caribbean for winter escape. All paid for. No debt. Planning our retirement. Saved for it. What a great feeling.

#18 K on 04.24.12 at 10:14 pm

If it’s so easy to buy dirt-cheap houses and rent them out for profits, why aren’t the Yanks doing it? I mean, they invented Apple and Viagra, so what gives?

Big belly laugh……true yes…but better still….very witty ! Keep it comin’ ….The reckoning be upon us ! {not funny}

#19 Mike Leblond on 04.24.12 at 10:16 pm

#3 Publius Enigma: you said “Fools have been proclaiming a “bottom” in US prices for two years. Yet prices continue to fall. And will continue to fall, until the shadow inventory clears.”

Well, that is false. Americans (in particular those in the real estate biz) have been proclaiming a bottom every year since 2008 and every year, they have been proven wrong!!!

#20 dutch4505 on 04.24.12 at 10:21 pm

My realtor friend in Bellingham sends me email every time land goes for sale or is reduced in price in Whatcom county. Last email was a price reduction for twenty acres of land, with nice home and large heated shop. Now a short sale price of $ 250,000. Located eight miles straight south of Abbotsford BC. I own enough land in Alberta and Washington state so I am not interested. A co worker in Abbotsford however is looking at the property this week. He also has an American wife so ownership of real estate in USA is no big deal. Now a dual citizen.

Of course his other option for 250,000 is a two bedroom one bath condo in Abbotsford and rent it out.

I wonder which one he is going to choose??

#21 AACI Okanagan on 04.24.12 at 10:21 pm

hey Garth remember that house on Broadway Ave in Orlando , check out the new price

http://www.zillow.com/homedetails/327-Broadway-Ave-Orlando-FL-32803/2146860823_zpid/

#22 a prairie dawg on 04.24.12 at 10:25 pm

I read somewhere that as a Canadian, if you own US real estate and you die owning it, it somehow drags your Canadian estate into the US tax equation.

Perhaps GT could address that when he revisits this topic…

#23 Dan from Richmond Hill on 04.24.12 at 10:26 pm

#17Intuitive Missus on 04.24.12 at 10:13 pm

Thank you!

“Bought nice little place in the Caribbean for winter escape.”

Sounds great. It is expensive?

#24 F on 04.24.12 at 10:26 pm

Great read! Keep it up!!!!

#25 45north on 04.24.12 at 10:30 pm

Dan from Richmond Hill: What do you mean by “shadow inventory”?

the US housing market peaked in the summer of 2006. Since then prices have dropped in virtually all parts of the US. As prices dropped, people have defaulted on their mortgages and banks have foreclosed. This description is a gross simplification of the actual process. At every step in the actual process, property is withheld from the market. For example if a property owner is delinquent on his mortgage the bank could foreclose but often does not – and the property is withheld from the market. Shadow inventory is distressed property that is not available for sale.

Mark Hanson argues that shadow inventory is like a snake that is squeezing the life out of the economy:
http://Mhanson.com/

#26 Not on the boat. on 04.24.12 at 10:34 pm

“In the meantime, do not go to the Intercontinental Hotel on Front Street in Toronto on Thursday at 3 pm.”

I’m there. Booking my flight now.

#27 The American on 04.24.12 at 10:34 pm

At #19: Mike Leblond, now you fully understand what Canadians have to look forward to, but only for a much more painful downturn in the real estate sector. Canada’s real estate collapse is going to be “epic.” Mark these words. Case Shiller Index, global banking analysts, International Monetary Fund (IMF), S&P are proclaiming Canadian real estate as perhaps the most “dangerous” and “inflated” bubble ever in the developed world. Good luck with that.

#28 Arb Watson on 04.24.12 at 10:35 pm

Australian real estate party over. Banks start to book losses…

Might Genworth’s (GNW -21%) delay of its Australian mortgage insurance business IPO be ringing a bell for the Oz property market? The company cites deteriorating market conditions in the Aussie mortgage market “as lenders accelerated the processing of late-stage delinquencies … at a higher rate and severity than expected.” Westpac

http://www.businessweek.com/news/2012-04-24/genworth-credibility-eroded-as-australia-plan-shelved-mortgages

#29 Inglorious Investor on 04.24.12 at 10:39 pm

Robert Shiller of S&P/Case-Shiller Home Price Indices fame, has stated, “Suburban housing prices may not recover in our lifetime.” Woah!

Sooth-saying or sign of a bottom? Recall the “The Death of Equities” BusinessWeek cover in 1979? Mind you, the stock market didn’t take off until ’82. So maybe US home prices will bottom in 2015.

Then again, Shiller was referring specifically to suburban homes. (Theory: Energy costs will make sub/exurban living too expensive for the average debt slave. But I suspect North America actually has more energy than we’ll know what to do with IF we are permitted to extract it.)

Are cities going to be all the rage? Maybe greenbelts and cash-strapped city councils desperate for tax revenues will help. Look at what it’s done for Toronto––now the “concrete box in the sky” capital of North America. Yet, we can’t build a damn subway.

#30 Arb Watson on 04.24.12 at 10:40 pm

K,

The yanks are not doing, because they bought during the boom, so a lot of people are stock and are booking losses on their investment properties. Most people buy when real estate goes up, not down. Who ever has money is buying real estate for a long term. USA probably will never come back to the volume it has in the boom years as a decent chunk in the last 2 years of the boom was fueled by subprime.

#31 Debtfree on 04.24.12 at 10:41 pm

Subprimates roflmao .
How about canobles you know how horny they are . The north American grenobles .
If you ever give up finance you’re a shoein on the comedy stage. Thanks I had a tear in my eye.

#32 In Garth and God We Trust on 04.24.12 at 10:42 pm

Captain Garth you may recall Wall Street Pete, a Canadian ex-pat working down with the man eaters on Wall Street was/is doing this very thing. The goofy Americans who lost their homes are now renting at a premium when they should be scooping up bargain basement prices. Even the super doomer Marc Faber is telling investors that US real estate is a bargoon. US real estate is on sale but the herd, having been burned is gun shy of buying. Classic herd mentality. They bought at the top and now that real estate has reached bottom they are too afraid to buy. Luckily we have our bearded mystic oracle to lead us in the financial wasteland of Canada. Pity those poor Americans sans such a leader!

#33 condopoor on 04.24.12 at 10:48 pm

Hi Garth, forum,

1. Sorry it’s off topic but I’m close to the end of my VRM (5 years) at 2.8%. I have the option to lock in for the duration at 3.5% – should I? It’s only 5 years!

2. Re. the topic, another get rich scheme, pushed by people like Steve Martel of “US Takeover”! Sounds exciting. In reality, like Garth says, if it was that good, why aren’t US investors scooping up cheap property?

If you want sub 100k properties, head to MLS.CA and plug in Welland, St Catherines, Windsor, etc… we have them here too. In droves.

#34 Makavelli on 04.24.12 at 10:50 pm

#21 AACI Okanagan on 04.24.12 at 10:21 pm

hey Garth remember that house on Broadway Ave in Orlando , check out the new price

http://www.zillow.com/homedetails/327-Broadway-Ave-Orlando-FL-32803/2146860823_zpid/
—————————————————–
When Garth posted this home, it was going for a half mill. That was several months ago. It was likely underpriced to start. Maybe hoping for a bidding war. Now priced 400k more. Prices are skyrocketing!!!!!

#35 Canadian Watchdog on 04.24.12 at 10:50 pm

Some of Flaherty’s early campaign contributors related to real estate and construction. http://i49.tinypic.com/1et4wj.png Elections Canada doesn’t publish information from 2007 and beyond. We wonder why…

#36 Dan from Richmond Hill on 04.24.12 at 10:50 pm

45north on 04.24.12 at 10:30 pm

Thank you!

#37 SGIP on 04.24.12 at 10:53 pm

What about bev oda?

http://www.thespec.com/news/canada/article/711718–oda-likes-the-flash-but-other-mps-are-spending-more-cash

.

#38 Stupesing in Cabbagetown on 04.24.12 at 10:56 pm

Sad: http://www.marketwatch.com/story/three-hidden-costs-of-the-foreclosure-crisis-2012-04-24?link=home_carousel

#39 Kokuzi on 04.24.12 at 11:04 pm

Time magazine April 24th article deals with this topic of US real estate prices, e.g. Atlanta down 17% in one year:
http://moneyland.time.com/2012/04/24/mixed-bag-of-housing-data-shows-recovery-except-in-areas-with-high-foreclosures/?iid=pf-main-lede

#40 the word of reason on 04.24.12 at 11:05 pm

YES please don,t go to that hotel that day the toronto hookers have booked the place for a massive sex fest !

#41 Arb Watson on 04.24.12 at 11:23 pm

Classic

http://vancouverpricedrop.wordpress.com/

#42 The Dude on 04.24.12 at 11:23 pm

“BeeMo actually has new numbers showing the pull of US prices on bidding-war-weary Canucks: 16% of us are ready to buy now; 56% would do so to get a cheap vacation home; 44% are smitten because America’s cheap; and a third think this is a good investment move.”

Hot Canadian Money?

#43 Tim on 04.24.12 at 11:24 pm

Why not buy in Spain? More culture, nicer architecture, higher literacy, fewer guns, less materialistic, cheap wine…There was massive overbuilding especially on the Costa Brava and many units are at low prices. If you are nearing retirement, then the economy is not an issue. In many areas it is a short hop to Paris with incredibly cheap intercontinental flights

#44 Tim on 04.24.12 at 11:28 pm

Re #37 Bev Oda
She’s not only incompetent, but spends recklessly and she should be ashamed of trying to weasel that outrageous hotel bill and limousine bill on Canadian taxpayers, especially since the neo-cons are laying people off to cut costs. Notice she only offered to pay the bill after she was caught out. This is disgraceful…she, and Peter Mackay who spent obscene amounts of money on hotels and helicopters at taxpayers expense fit right in with their shameful leader

#45 rigged on 04.24.12 at 11:29 pm

vancouverpricedrop.wordpress.com is documenting the top 10 biggest price drops with some commentary each week in the Vancouver area

#46 Bad Advice on 04.24.12 at 11:30 pm

“If it’s so easy to buy dirt-cheap houses and rent them out for profits, why aren’t the Yanks doing it? I mean, they invented Apple and Viagra, so what gives?”

Garth,

I strongly disagree with your logic on this one.

This sort of logic wil prevent one from going after just about any opportunity.

If I wanted to argue that the sort of balanced portfolio you always advocate is too risky, I could just say “if it was so easy to earn a 7% return on a balanced portfolio of bonds, prefs and REITs, why isn’t everyone doing it?”

The fact is there are plenty of opportunities available to everyone that, for one reason or another, most folks just won’t go after

#47 ak_forty_seven on 04.24.12 at 11:35 pm

This is whats going at the Intercontinental Hotel:

Ownership Structures for Canadians
Invest safely with confidence
100% passive investment solution
4 dates to choose from: April 26,27,30 or May 1 2012
Intercontinental Hotel, 225 Front Street West, Toronto

#48 Canadian Watchdog on 04.24.12 at 11:42 pm

Money Power & Wall Street (Full Episode)

http://www.ritholtz.com/blog/2012/04/money-power-wall-street-full-episode/?utm_source=dlvr.it&utm_medium=twitter

The whole truth and nothing but the truth, and why the financial system will crash again.

There are no rules. This is global looting.

#49 golem on 04.25.12 at 12:02 am

Apple IS Viagra! Up, ever up.

#50 Kilby on 04.25.12 at 12:05 am

#17Intuitive Missus on 04.24.12 at 10:13 pm

Thank you!

“Bought nice little place in the Caribbean for winter escape.”

Sounds great. It is expensive?
————————————————————–
Used to winter in Barbados and Dominican (before it became popular) Where did you buy? Always interesting to hear when someone discovers their place outside of the States or Mexico…………

#51 Not 1st on 04.25.12 at 12:07 am

I don’t and won’t invest in america no matter how low houses get. I don’t invest in chronically over indebted, over indulgent societies. I won’t invest somewhere where 1% control all the wealth. I won’t invest in corruption or money printing or ponzi schemes. I won’t invest in any entity that conducts wars of convenience. I won’t invest in a country that drops a trillion into bullets and bombs while people do not have basics of life or health care. I won’t invest in a country that rebuilds Baghdad and Kabul instead of Detroit.

#52 Keith on 04.25.12 at 12:19 am

Google “Warren Buffett on U.S. real estate”

#53 Investx on 04.25.12 at 12:37 am

“And this week the Fed will reinforce once again that mortgage rates – now close to all-time lows – are going nowhere.”

Still? Who do they think they are… Japan?

#54 MarcFromOttawa on 04.25.12 at 12:57 am

http://www.cbc.ca/news/canada/story/2012/04/24/carney-household-debt.html

Look at C smile in that picture. Doesn’t that look like the smile of someone you can trust?

“I will note that the proportion of variable debt of new mortgages has gone down quite substantially and is running in the low teens,” he said.

I wonder how much 2.99% mortgages had to do with this?

#55 Tamsen on 04.25.12 at 1:08 am

“Makavelli on 04.24.12 at 10:50 pm #21 AACI Okanagan on 04.24.12 at 10:21 pm

hey Garth remember that house on Broadway Ave in Orlando , check out the new price

http://www.zillow.com/homedetails/327-Broadway-Ave-Orlando-FL-32803/2146860823_zpid/
—————————————————–
When Garth posted this home, it was going for a half mill. That was several months ago. It was likely underpriced to start. Maybe hoping for a bidding war. Now priced 400k more. Prices are skyrocketing!!!!!”

That’s because everybody knows Canadians like to pay more for everything – ha!

Best pic yet, Garth! Not sure how those darling dogs put up with us humans …

#56 Devore on 04.25.12 at 1:09 am

#19 Mike Leblond

That’s what I was thinking, 2 years? Idiots like Cramer have been proclaiming the bottom for 4!

#57 Arb Watson on 04.25.12 at 1:21 am

Oh this is a priceless exchange…

http://vreaa.wordpress.com/2012/04/24/minister-of-finance-james-flahertys-letter-to-gord-goble-a-home-is-a-familys-most-important-investment/

#58 Debtfree on 04.25.12 at 1:22 am

@37 still a lot cheaper than peters fly in and out fishing .she paid the bill and said sorry . We Canadians are still waiting for Peter to pay up and say sorry . I miss ebpv . I guess he’ll be breathing into his paper bag for awhile . Wild rose and all .He’s a loco gringo .as Caezar Chavez would say .

#59 Kale on 04.25.12 at 1:32 am

Smoking Man you plugged ERF yesterday since you are ‘feeling a bottom’.

Forecasted next year earnings, 1.04/share
Current dividend, 2.16/share

If I wanted a time bomb I’d line up for a Vancouver condo.

#60 Mark on 04.25.12 at 2:20 am

#3, “US real estate will not truly rebound until shadow inventory is cleared.”

Not only that, but there is an enormous number of factories and firms still in the housebuilding business, with staff and equipment ready to build more whenever it is economical to do. Just like the dot-com stimulated investment in computer factories ushering in an era of the $500 computer, the real estate bubble stimulated massive investment in companies and infrastructure to deliver housing to market.

To look for a rebound in housing in the USA is a bit silly. Sure, there will be ups and downs, but there are plenty of other solid asset classes in the US market and globally that are dramatically better value.

#61 wopaholic on 04.25.12 at 3:50 am

Ummmm I can buy a home for less than $250,000 that could make it onto an episode of “Cribs” in Arizona, Texas or Nevada (all known for paradise climates) and you people are still talking about reaching a “bottom” in the US market??? I can’t even renovate my home for that in Shitsville (AKA Toronto) Ontario. That’s what an average detached home (aka a crack house in a meat locker climate) in the 416 area will depreciate in the 1st year when the s*^t finally hits the fan here. Give me a break.

#62 House on 04.25.12 at 5:50 am

One US Realtor on HoweStreet bemoaned that Canadians were buying foreclosures at high prices and driving out the US buyers. Maybe that’s why the market is “stablizing”.

#63 bigrider on 04.25.12 at 6:46 am

“The further you are from your property the closer you are to your losses”

Horny house humping Canadians interested in brick licking some U.S real estate..

Be afraid, be very ,very afraid.

#64 bigrider on 04.25.12 at 6:54 am

#49 wopaholic.

Well said. You need to take it up with Nonno Nicola, a poster on this blog.

He’s into the vino a little too much to think clearly…LOL

#65 Onemorething on 04.25.12 at 6:59 am

Sorry but US RE is going down down down. 15% MORE off the national avg over the next few years.

Canada is a complete clusterf*ck in RE just waiting for a complete pounding. It’s insane, and there’s a big price to pay for insanity folks.

Aussie Market in everything from RE Autos Retail getting slashed to SH*T right now so look to our Aussie mates to show you the future Canuckville.

The average job is getting sucked dry of everything left and many high flyers I know are just leaving the USA right now. They know something you dont, so do I!

China is on a road to ruin and all the pimped up Cites like Shanghai, HK and even places like Singapore are doomed. Places like Kuala Lumpur are over prices on condos by 40% easy and SFD’s by 20-25%.

Cash is still going to be king as even if the buying power of a USD stinks it doesnt have far to go, GOLD is manipulated anyhow and while a good 3-5 years of debt deflation continues, inflation will come inventually.

All that points to not owning anything except liquidity!

It’s pathetic how stupid the general populus has become!

#66 Student Debt and Housing on 04.25.12 at 7:11 am

Interesting Article:

‘Explosion in Student Debt’ Drags Down Housing: Chart of the Day

http://www.bloomberg.com/news/2012-04-17/-explosion-in-student-debt-drags-down-housing-chart-of-the-day.html

#67 Dr. WAYNE on 04.25.12 at 7:28 am

“Just think how stupid the average person is, and then realize that half of them are even stupider!” –George Carlin

#68 yorel on 04.25.12 at 7:41 am

Please check the taxes for an out-of-state owner in Florida. Then, if you’re still interested, check the insurance. A lawyer friend of mine doesn’t insure his expensive house in Florida. He figures a few good years and he can buy another house.

They don’t care if you are American or not. Out-of-state is out-of-state for tax purposes in Florida.

There is no special property tax in Florida for foreigners. Rather there’s a homestead exemption for local residents who apply for it. Google, then type. — Garth

#69 TurnerNation on 04.25.12 at 7:44 am

Over on the Junior Board (sometimes good for a laff, check the thread about two friends considering an investment condo purchase, for 500k), Crapital One getting old feet?

http://forums.redflagdeals.com/capital-one-not-allowing-any-credit-limit-increases-1162165/

“Before we decrease the credit limit, we wanted to advise you that once the limit is decreased, it cannot be increased again by request and
Capital One has made a business decision in light of the current economic environment to hold off on offering any credit line increases.
This is a decision applicable to all of our current cardholders, and is in place for the foreseeable future.”

#70 Foggy on 04.25.12 at 7:52 am

@33 Condopoor:
Hi Garth, forum,
1. Sorry it’s off topic but I’m close to the end of my VRM (5 years) at 2.8%. I have the option to lock in for the duration at 3.5% – should I? It’s only 5 years!
—————-
A 3.5% mortgage is a great rate for even one year, let alone 5 years. What’s the risk? That mortgages will drop to 2% for 5 years? Not a chance of that happening.
I would lock in…..

#71 Nonno Nicola, Big Rider's Financial Adviser on 04.25.12 at 8:07 am

#62 Bigga Rider

Hey Bigga Rider, buon giorno caro figlio. Youa never giva me a da feedbacka on Alberto Friedbergo’s Quarterly Reporto. I tella you yesterdaya to read a this reporto of one of da world’s besta funda manageros. My nipoto Tonino, he a reada me thisa reporto every quarter. Please letta Nonno Nicola knowa whata you a thinka.

http://www.friedberg.ca/webpieces/reports/quarterly/First%20Quarter%202012%20-%20Quarterly%20Report.pdf.pdf

#72 Foggy on 04.25.12 at 8:07 am

Speaking of US real estate investing – here’s an article on buying in US college towns:

http://money.cnn.com/galleries/2012/real_estate/1203/gallery.college-towns/?iid=F_Jump

#73 John on 04.25.12 at 8:08 am

The talk of US real estate dynamics “in or around a bottom” in the context of a “US recovery” is misguided.

How would it be possible to examine the issue without looking at these factors:

1. GDP composition made up of 72% consumption
2. Eroded domestic manufacturing base meaning an uncertain supply chain for housing.
3. Falling wages that will continue to fall.
4. High corporate earnings literally built on speculation.
5. A history of quantitative easing which has and will make corporate earnings a fake ponzi scheme anchor number.
6. The certain transformation of Europe and what it will mean for the economy at a world level.
7. Internal demand in China uncertain, and a cloudy political landscape.
8. Uncontained social media that could turn from being a mind-numbing drug to a platform for hungry addicts
( consumers) to “get mad” at “government”…all requiring censorship.
9. A sharp spike in dealing with “vulnerable” segments of the population as the digital money fraud ( derivatives) becomes obvious.
10. People’s reaction to an emerging understanding that there is no representative government ( Mitt Romney vs. Obama fraud).

The ostrich method of looking at such an important sector of the global economy as real estate is dated.

Central banking entities have implemented and directed policies to drive the money in local real estate into the global ponzi.

The “town””home” is in Greece, China, Europe, Emerging markets…everywhere. That’s not a matter of opinion. And if a new version of “doom” were ever to emerge, it’s best definition would be: “A pathological or systemic inability or unwillingness to examine the facts.” Anything that moves away from that is pure upside.

All irrelevant. Americans will buy houses as they regain jobs. — Garth

#74 Bottoms_Up on 04.25.12 at 8:10 am

To all the non-believers out there, the average doctor in Ontario now makes $362,000 per year. Four times the average family income is a little high?

http://www.ottawacitizen.com/Health/6512016/story.html

For what? — Garth

#75 Nonno Nicola, Big Rider's Financial Adviser on 04.25.12 at 8:11 am

#60 Wopaholic

You maka Nonno Nicola laugha so a harda, he hava to change his pantaloni!

#76 Time to leave Canada for a better life on 04.25.12 at 8:12 am

Canadians have bought homes with nothing down and borrowed from their HELOC to pay off their credit cards and borrowed from HELOC to buy investment properties in Canada and now the US. All this on borrowed money. Canadians are going to walk just like the Americans. Canadians have been using their homes like an ATM. Carney you are either stupid or plan to bankrupt Canada and Canadians.

#77 Victor on 04.25.12 at 8:22 am

Bubble watchers set to eye Canadian housing data

Wednesday, April 25, 2012

Bank of Canada policy makers are weighing whether to raise interest rates over the next few months, so you can bet they’ll be looking to any drop of news from the housing market to help guide their decisions.

Although it’s a bit long in the tooth, the Teranet-National Bank Composite House Price Index for February comes out Wednesday, offering a gauge of how much more or less it costs to buy an existing single-family home. The index is rather limited on the whole, in that it does not provide actual prices, and it only tracks the rate of change in prices on properties where homes have been sold at least twice.

http://www.theglobeandmail.com/report-on-business/economy/economy-lab/daily-mix/bubble-watchers-set-to-eye-canadian-housing-data/article2413403/

#78 fancy_pants on 04.25.12 at 8:26 am

Greed and inexperience are not an attractive combination to take to the investment table. Good advice here; tread carefully as many suffer from the first condition and many more suffer from the second (foreign RE investment).

+ you won’t find that elusive state of contentment chasing your greed around.

your mileage may vary depending on the degree of condition A + the degree of condition B that you suffer from.

#79 Young Old Fart on 04.25.12 at 8:26 am

#48 Kilby on 04.25.12 at 12:05 am
#17Intuitive Missus on 04.24.12 at 10:13 pm

Used to winter in Barbados and Dominican (before it became popular) Where did you buy? Always interesting to hear when someone discovers their place outside of the States or Mexico…………
=====================================

Mexico for me. There is a great Canadian contingent here and a few yanks as well. Media has so over blown any issues. We love it. I still get emails from friends who live in Canada and tell me how they hear gunshots almost every day. All I hear everyday is the surf….

#80 Young Old Fart on 04.25.12 at 8:32 am

#57 Kale on 04.25.12 at 1:32 am
Smoking Man you plugged ERF yesterday since you are ‘feeling a bottom’.

Forecasted next year earnings, 1.04/share
Current dividend, 2.16/share

If I wanted a time bomb I’d line up for a Vancouver condo.
====================================

I disagree. It may fluctuate but will go well in the long haul. I am not so sure whether it was Smoking Man made the recommendation or a fake…..

#81 Jeff on 04.25.12 at 8:37 am

Garth,

It would be interesting to get your take on the 5 – 7 million foreclosures to come on the market over the next 3 years. From what I understand foreclosures slowed due to the ‘robo-signing’ fiasco at the banks. Per the article below from the Washington Post (http://www.washingtonpost.com/wp-dyn/content/article/2010/03/11/AR2010031104866.html) , the robo signing issue is somewhat behind them and the foreclosures are going to be starting up again….thus I would be lead to think that we are not at the ‘bottom’ of the real estate prices but ready for another dip….what’s your take?

#82 Tom from Mississauga on 04.25.12 at 8:37 am

Hi Garth

Please add some US REIT’s that would take advantage of this for Jenn and I when you circle back to this.

Thanks!

#83 steev on 04.25.12 at 8:39 am

#45 Bad Advice on 04.24.12 at 11:30 pm

You make a good point. If the goal is to be a contrarian investor, now is probably a great time to jump in to US real estate.

The way I’m reading this post though, the gist of it is:

“There’s a potential opportunity in US real estate, educate yourself properly before taking advantage of it.”

not

“Stay away from US real estate because smart Americans who invented apple and viagra think its a bad play”

Cheers

#84 In God and Garth We Trust on 04.25.12 at 8:47 am

Big Rider #89 From yesterday’s posts

“Your portfolio construction Garth is very well diversified. In no way can you possibly be implying that your portfolio’s are up the full extent of the S&P’s advance, are you?”

Are you kidding me Big Rider??? The bearded mystic oracle from the east that runs this blog and who is the lone voice crying out in the financial wilderness of Canada is surely above the paltry S & P advances in his personal returns. He doesn’t brag about it for fear of upsetting the mere mortals who come to his blog for their daily dose of financial wisdom. Sheeesh Big Rider, I thought you knew better

#85 Peter (NYC) on 04.25.12 at 9:19 am

It’s me again ! I have been reading but not posting. I need to part ways with you on this one Garth. I am a Canadian – recently obtained my US Citizenship – and I am keen to get to my maximum of 10 Fannie Mae sponsored fixed rate mortgages. I am at 9 today and now scraping and saving to get a downpayment to close my next property. Most of what I have purchased are 4 plexes in you got it – Arizona. Try finding one to buy today – it’s next to impossible at distressed prices at least. Inventory for good rentals has gone out the window because the cat’s been out of the bag for a while now.

The reason why Yanks aren’t buying these places?? There is no reason you dam right they are buying. Good rentals with high cash flow are being looked at seriously by bigger and bigger investors.

The small investor and average homeowner are in a tight spot. A large percentage of homeowners are underwater on their own mortgage and even if not are not finding it easy to get financing for some of the great deals out there. I have a pretty good income and all my properties produce positive cash flow – I still actually had a bit of a hard time getting mortgages 8 and 9.

Are Canadians doing the right thing when they look for property down here? Answer – NOT ALWAYS.

Most Canadians I’m seeing can’t divorce the notion of investment for income vs. a second home in a warm location. Chances are if you really want to live in the property you are eying in the US – then it is a bad rental income property. Everyone and their cousin still wants that perfect warm getaway that they can use 3 weeks a year and then for the remaining 49 weeks it gets magically rented out headache free for you. (Keep dreaming).

I disagree with your advice wholeheartedly. If you are looking for good high cap rate realestate income property and you are Canadian – there are still really good deals down here. The trick is make sure you deal with a good cross border estates and accounting expert because there are pitfalls to owning real estate in the US as a Canadian. Also – don’t try to manage the property yourself – best opportunities are with folks who sell the property and then manage it for you.

If you are filthy rich with money to burn – you probably missed the opportunity to buy a dirt cheap condo in Miami – that was 2 years ago – sorry – the rich Brazilians, Arabs and other wealthy foreigners (some Canadians) have made the market for choice locations very expensive. But there are other lovely places where you can still get property for a once in a lifetime price if the second home is your dream (personally I don’t like second homes – spend your money more wisely and buy income property + all inclusive vacation once per year).

#86 cramar on 04.25.12 at 9:37 am

Posted this yesterday. For anyone who missed it. Millions more Americans are going to rent:

http://www.bloomberg.com/news/2012-04-24/millions-more-u-s-homeowners-to-rent-pimco-s-simon-says.html

#87 Mike on 04.25.12 at 9:38 am

Garth, you just told a group of contrarians not to go to the Intercontinental Hotel.

They deserve it. — Garth

#88 Kilby on 04.25.12 at 9:40 am

#61 House on 04.25.12 at 5:50 am
One US Realtor on HoweStreet bemoaned that Canadians were buying foreclosures at high prices and driving out the US buyers. Maybe that’s why the market is “stablizing”.
—————————————————————–
There is a lot of resentment towards “foreign buyers” in Vancouver as it is perceived that they are responsible for driving up prices. I wonder if there is the same feelings in pockets of the United States when people start noticing that Canadians are taking over some neighbourhoods, Phoenix for example……..

#89 This is Wonderland on 04.25.12 at 9:42 am

#78 Young Old Fart

Were the hell do your Canadian friends live that they hear gunshots every day?

#90 G2thaBLA on 04.25.12 at 9:57 am

It is good to see Mattamy Homes doing their part: http://business.financialpost.com/2012/04/23/portable-buildings-put-communities-on-the-move-literally/#Comments

#91 Intuitive Missus on 04.25.12 at 10:07 am

#23 Dan from Richmond Hill & #48 Kilby

Bought in beautiful, sunny West Coast Barbados (Holetown, if your know the island). 30C year round. South & East of the “hurricane tracks”. ~US$250K. Reputable UK developer. Nicely appointed 1BR condo in small new building (9 units – 1 & 2BR). Most owners will live there year-round. Progress payments made during construction. We visited the site last October to check out the construction. Well-built. Converted our money last summer when C$ was $1.05. Barbados eliminated capital gains tax on real estate so tax regime friendly for foreign owners. RE market had already dropped about 20% when we bought with some more correction expected on expensive properties. Our building sold out in a couple of months in 2011. Most buyers coming from the UK & Canada. Air Canada (daily) & WestJet (Mon-Sat) have direct flights. Take possession in June. Can hardly wait.

#92 jess on 04.25.12 at 10:14 am

Traders transfer belief system -confusing need with spending power.

“My job is to bring physical goods from a place where the people don’t need them to a place where they are needed.”

smoking man said: “Here is an extremism case of belief system gone wild.”

Try this one
http://video.pbs.org/video/2226432507/
exotics- regulatory risk removal services
http://www.pbs.org/wgbh/pages/frontline/
money,power and wall street: episodes one and two

Phil Angelides, Chair, Financial Crisis Inquiry

….” We created $13 trillion of mortgage securities, many of them defective, many based on loans that never should have been made, many based on loans that were fraudulent. ”
================

#93 The American on 04.25.12 at 10:14 am

At #67: Yorel, you proclaim yet ANOTHER idea for which Canadians seemingly have a complete lack of knowledge or understanding. No state in the U.S. has a real estate tax status for 1) Out-of-state owners or 2) Foreign owners. The real estate tax is a reflection of the local municipality’s millage rate against the assessed value of the property. If, however, you are a local resident (doesn’t matter if you are a foreigner or not), in many areas you may apply for an exemption on your local real estate taxes which reduces the total amount of tax paid (it does not eliminate it). It is just that simple. Where do you all come up with this stuff? Is it a prerequisite that all Canadians must attend a anti-U.S.-fear-and-loathing program prior to getting a degree? Like it or not, this is the very reason Americans tend to view Canadians as fear mongering, naive souls.

#94 Frank on 04.25.12 at 10:36 am

The U.S. housing market is more evidence that low interest rates are here with us for some time to come. If a housing correction is going to happen, it will not be because of higher interest rates.

#95 landlessinvan on 04.25.12 at 10:43 am

Actually, I think someone like Warren Buffett has been buying up houses by the hundreds to then rent back to Americans. Another way for the wealthy to make money off those less fortunate.

Actually, he is helping the less fortunate. — Garth

#96 Nonno Nicola, Former Investment Adviser to Big Rider on 04.25.12 at 10:51 am

#63 Big Rider

“He’s into the vino (me Nonno Nicola)a little too much to think clearly…LOL”

Aya Bigga Rider you a disappointa Nonno Nicola. I treat you like a figlio and even giva you the Alberto Friedbergo reporto, he isa one of da besta traders in da world and you no even risponda… I trya one mora a tima and den finito, no mora!

http://www.friedberg.ca/webpieces/reports/quarterly/First%20Quarter%202012%20-%20Quarterly%20Report.pdf.pdf

#97 Kilby on 04.25.12 at 10:52 am

#91 Intuitive Missus on 04.25.12 at 10:07 am
#23 Dan from Richmond Hill & #48 Kilby

Bought in beautiful, sunny West Coast Barbados (Holetown, if your know the island). 30C year round. South & East of the “hurricane tracks”.
——————————————————————

Had a good friend years ago that had a shop in Holetown, nice spot, she now has a bed and breakfast in an old windmill up the hill. Nice place to winter or live, good water, nice people and well run utilities…Congratulations.

#98 In God and Garth We Trust on 04.25.12 at 10:56 am

#84 Peter NYC

Thanks for the update Peter. Kudos to you and your investment program! You are spot on in what you are doing. Keep us posted on your progress. I mentioned you earlier in a post to our fearless bearded mystic oracle from the east, financial tea reading prognosticator, former parliamentarian and minister of national revenues and all round jolly good fellow Garth.

#99 jess on 04.25.12 at 11:07 am

Back in 2007, the Congress passed legislation to hold Stafford loan interest rates at 3.2%, less … are taken out by nearly eight million students each year, will double on July 1, to 6.8 percent.

#100 Intuitive Missus on 04.25.12 at 11:17 am

#85 – Timing is Everything

1. Retiring in less than 2 years. Family all grown up now so no need for a big house in GTA anymore. Took our money out last June in anticipation of RE correction. Renting here for now. In future, we may buy back into the market here or elsewhere in Canada. We’re in no rush. We’ll see what makes sense for us.

2. Barbados

3. Very expensive to rent a nice place in Barbados for 5-6 months in the winter.

4. Plan to spend winters there when retired but can “house swap” with other property owners anywhere. What a great way to see the world. Also have friends, neighbours, colleagues who want to rent the place when we’re not there. And when we don’t want to own it anymore, don’t think we’ll have any trouble selling it. It is a very affordable property compared to everything else around us. Depending on when we sell, we could benefit on the exchange since RE there is priced in US$. We’re not counting on that but it would be a nice bonus :)

#101 johnny5z on 04.25.12 at 11:20 am

A young man who works in our office, and still lives with parents, has been buying properties in the Phoenix MSA for the past two years. He reports that the “better” affordable properties have been sold (short or out of bank REO). That leaves homes in areas, how do it put it, where you’d have to hire Bubba to collect the rent.

#102 givemeabreak on 04.25.12 at 11:29 am

#78

Gunshots everyday?

I have lived in Montreal, Ottawa, Toronto, Vancouver, Winnipeg, St john’s and Gottingen St in Halifax and never heard a gun shot in 30 years.

Mexico has fine weather and I doubt you will be murdered there but dont tell me that “Mexico” is safer than “Canada” for a middle class guy.

#103 Snowboid on 04.25.12 at 11:45 am

#88 Kilby on 04.25.12 at 9:40 am…

No resentment seen yet, they embrace us with open arms. They are happy to take our money, and they love H and they love the Alberta oil – that they can sell for less than we pay here!

Okay, it’s really just a few that like H and most don’t know that a lot of oil flows south from Canada!

A big plus for the full-time residents is the neighbourhoods are so quiet May-October! There are many US snowboids that leave AZ the same time we do. Most we know are from Minnesota, Indiana, Illinois – some from the Pacific NW as well. I would estimate 1/3 are not full-time residents.

In all our years in Saskatchewan, Alberta and BC, we haven’t seen more friendly, neighbourly people than in our NW Phoenix community.

Saskatchewan came close, but that’s it!

#104 Erika on 04.25.12 at 11:47 am

Why are New listing so low in the GTA? If people are getting top dollar and with low interest rates what is stopping them? My realtor has no answer for me.

#105 Do Do Bird on 04.25.12 at 11:54 am

Yes, you can buy a nice little bungalow in Texas; Arizona; Florida; Mississippi or Alabama or Georgia for under $100k but that is not the best part of wintering in U.S.

You get a pleasant climate year round so your cost to heat home are low; you get good amenities like libraries; sidewalks; sports complexes; churches; community colleges; etc.

The difference between buying north of T.O. in the Kawarthas and Muskoka and buying in U. S. is you avoid the BLACK FLIES and you can use the property
12 months a year if you buy in the states.

I WON’T EVEN GO INTO HOW EVERYTHING SO SO DIRT CHEAP.,…IT’S ALMOST SINFUL THE DIFFERENCE IN PRICES BETWEEN U.S AND HERE.

Another hint for all you American bound Canadians….I usually get my eye glasses there and most dentist give you a free first visit.

Most colleges give free classes to over 65…a real deal.

#106 Consider This on 04.25.12 at 12:03 pm

It’s not the prices of US real estate they are balanced for a slow, meandering, mild depression. Its the tax and immigration entanglements. Canadians are sought for their money not their presence. Beware grasshopper its all too good to be true

#107 Canadian Watchdog on 04.25.12 at 12:16 pm

Say bye bye to cash payments Canada. http://ca.reuters.com/article/topNews/idCABRE83O0LT20120425

#108 Nonno Nicola, Fomer Financial Adviser to Big Rider on 04.25.12 at 12:18 pm

#170 Turner Nation

“I stopped reading Friedburg’s pap at this line, pg. 3. It’s not the first time his fund has blown up in the short term.“The net asset value of the Friedberg Global-Macro Hedge Fund Ltd. fell 18.1%, recording
its worse quarter in its 10-year history”

While it is true that the Friedberg fund had its worst quarter in its ten year history, if you had read further you would have noticed that its year over year results were still up 20%. With all due respect to your trading abilities, Albert Friedberg is one of the world’s greatest traders and has a 40 track record that is virtually unmatched. In order to get the kind of returns he tries to achieve in some, not all of his funds (some are far more conservative) one has to expect this type of volatility. To think that this was this fund’s worst quarterly performance in 10 years and yet was still up, year over year 20% should give you an idea of how good he and his traders are. He is not and has never been a “blow up artist”. You must be confusing him with Victor Niederhoffer, author of the bestselling autobiography, The Education of a Speculator.

Hope this response is lucid enough for Big Rider who thinks I am a drunken wino…:)

#109 Koolaid Drinker on 04.25.12 at 12:19 pm

#78 Young Old Fart

“We love it. I still get emails from friends who live in Canada and tell me how they hear gunshots almost every day. All I hear everyday is the surf….”

I think your friends should move away from the Police Academy shooting range.

#110 In God and Garth We Trust on 04.25.12 at 12:22 pm

#168 Cramer from yesterday’s blog

“A bit of an exaggeration here. There are others. I was just reading something written by Gordon Pape the other day and he was saying the same thing about RE.”

Puhleeze….how dare you mention the bearded mystic, all knowing, all seeing, all wise oracle from the east that runs this blog in the same sentence as Gordon Pape. Really!!

#111 Bill Gable on 04.25.12 at 12:26 pm

Laughing so hard, I had to get 911 handy. Come off it!

Buying a home in the US, in light of MERS, and the on-going draining of the pool of suckers – leaves some rube from the GTA who thinks a palmetto bugged dump in Pompano Beach is a great deal.

Give me strength!

Mr. Turner = are the Amazons coming to the Hotel?

#112 yorel on 04.25.12 at 12:30 pm

Please check the taxes for an out-of-state owner in Florida. Then, if you’re still interested, check the insurance. A lawyer friend of mine doesn’t insure his expensive house in Florida. He figures a few good years and he can buy another house.

They don’t care if you are American or not. Out-of-state is out-of-state for tax purposes in Florida.

There is no special property tax in Florida for foreigners. Rather there’s a homestead exemption for local residents who apply for it. Google, then type. — Garth

What’s the difference? Out of state people pay higher taxes. Think, then type.

There is no special tax for foreign owners. Nor do Floridians who do not apply for the reduction pay less than Canadians. — Garth

#113 Steven Rowlandson on 04.25.12 at 12:37 pm

I think that as cheap as American real estate might seem to Canadians such real estate is still expensive relative to what Americans with or with out jobs earn.
If that were not the case all those devalued properties would be snapped up in a heart beat and lived in or rented out. Affordability is relative to your income and if your not getting paid enough then there is not much you can buy. I think pices have not bottomed out yet.

#114 };-) aka DA on 04.25.12 at 12:43 pm

#162SaggyBottomBoomer on 04.24.12 at 7:14 pm
#141 };-) aka DA on 04.24.12 at 2:07 pm
” What she thinks is respect is nothing more than insincere flattery used as bait to lure an easily manipulated mind. };-)”

Kind of like the same treatment you get from a Realtor n’est ce pas?

I can’t imagine if one were of similar intellect that there would not be someone out there willing to take advantage. You know what they say about a fool and their money…

#95landlessinvan on 04.25.12 at 10:43 am
Actually, I think someone like Warren Buffett has been buying up houses by the hundreds to then rent back to Americans. Another way for the wealthy to make money off those less fortunate.

Actually, he is helping the less fortunate. — Garth

Yes a return to Feudalism where Vassals can forever be indebted to a Lord is EXACTLY what the Blog Dawgs are after. Shepple… if they aren’t now following your advice they soon will be as you entice them to give up one of those so fundamental aspects of a democratic society – property rights.

Yes I know I may be stretching it a tad but I suspect if the Blog Dawgs really thought about it they might see the risk.

Conspiracy theorist? Nah, there’s no conspiracy or hidden agenda here is there Lord Garth? };-) LOL

“Greater fools you are incapable of looking after yourselves. You ought realize this and become the simple serfs you were born unto this world to be. Work your Lords land, fight your Lords battle, pay your Lord his due for looking after you his shepple. Aspire not to become any more than you are – an instrument of another willing to provide a place to rest that you may work another day for his benefit never aspiring to attain any of your own as you remain shepple forever more.”

Land has always been and will forever in this life continue to be a most fundamental underpinning of any and every society. He who controls the land has control. He who has no land to control ultimately has no control as they remain but a serf indebted to the Lord of the Manor they must work for to earn their keep.

Ya that’s a system you all want to go back to all right. This whole notion of owning vs renting is a poor economic model. We need to turn back the hands of time. Serfdom is a WAY better gig.

(sarcasm off)

#115 Arb Watson on 04.25.12 at 12:48 pm

Onemorething,

Inflation is already here. It has been exported to Europe and Asia if you haven’t noticed.

#116 Dividend Yield Investor on 04.25.12 at 12:49 pm

The U.S economy has entered recession as of NOW. This will be a mild recession lasting the standard measure of two back to back quarters. A contraction of -1% the first quarter and the second less than -0.5%.

This is on the heels of a global recession with pockets of out right depression [Spain, Portugal, Greece and possibly Italy].

Greece has gone past depression, for we hope that they hold onto to their democracy and not slip into a strong man or ex-Soviet style government.

Australia is an economic colony of China. China is going to get hit hard economically, with too many miss-allocations of capital to mention, and it is happening at this moment. Australian RE has top out and will drop for years, along with a debt bubble that has popped.

This U.S. recession will push American RE into Max-Pessimism, however, for those who are looking for the fast money [capital gain] you will be in for a long wait. Those individuals who truly understand rental properties are buying up properties on a cash basis. They realize [the smart players] that it will be another 5 to 7 years before the U.S. economy sorts itself out.

The Canadian situation is also an economic colony of China with your natural resource sales. This will by itself create an economic downturn; when it is combined with a debt bubble in the private sector greater than the U.S. you are looking at a nasty recession.

The advice for Canadian RE is to sell your properties yesterday and get liquid. For those who have knowledge and experience in RE the U.S. is the place for the long term investor [10 to 20yrs].

For those of you who are new at the RE game and have looked into the mirror, that this not some passing fancy, then go ahead. Do so on a cash basis only. This will mitigate your mistakes. Happy hunting.

For Canadian RE you better hurry for the economic sniper has his cross hairs trained on you. He has an excellent sight picture, breath control, and he is now squeezing the …!

Dividend Man
Atlanta GA, USA

#117 };-) aka DA on 04.25.12 at 1:01 pm

But seriously the less fortunate and greater fools ought to be protected from their own folly. We don’t give everyone a driver’s license do we? Not everyone is capable of looking after themselves and ought not be exposed to the high degree of responsibility required of owning land. This is the very reason we will not allow a minor to own land – they are not mature enough. So those greater fools too should be denied such risky venture they are clearly ill-equipped to master.

I say we return to a caste system where we can better manage our economy that those greater fools not be allowed to take upon themselves such risk the cost of which when failure is bestowed upon them must ultimately be borne by us all.

They our Vassals ought be relegated to working for us and not themselves. Any profit they show at the end of the day should be handed over to us that we might better look after it for them for they are so clearly incapable to doing so for themselves. And the line in the sand should be drawn at the fundamental underpinning that separates we the Lords of the Manor from they the Vassals who rent and work our land.

Do I stretch the truth too far? Well, that would be your call… };-)

#118 SHUT UP Mark Carney on 04.25.12 at 1:12 pm

Hey mark carney I’m sitting in the doctors office and these 3 23-26 year olds are talking about RE and where to buy and about being able to put down a small dp to buy in a new sub division. These kids should be talking about clubing but they are RE experts. The last time I seen this many experts was the year 2000 days before the dot.com went boom.

#119 Derek R on 04.25.12 at 1:24 pm

#116 Dividend Yield Investor on 04.25.12 at 12:49 pm wrote:
The Canadian situation is also an economic colony of China with your natural resource sales.

Well that’s what we’re aiming for but there’s still some way to go. We’re still mainly an economic colony of the USA right now. And since we’re just changing imperial masters it probably won’t make as much difference as you seem to think.

#120 LTL_FTC on 04.25.12 at 1:25 pm

Garth,

I know you’re not big on the idea of buying US R/E for most people, but I’d love to add a book to my GT collection in which you expound on the subject in greater detail.

#121 };-) aka DA on 04.25.12 at 1:31 pm

#118SHUT UP Mark Carney on 04.25.12 at 1:12 pm
Like I said… Greater Fools should be protected from themselves and denied right to own property. They couldn’t possibly have the maturity at such a young age as 23 to 26 to manage land of their own. Be damned. Tell them “NO, you’ll not be owning any land!!! Now get to work and pay me my rent! If you have any left at the end of the day go nightclubbing that you might dull your already numb senses and be even more easily manipulated by me. You are a serf – it’s your function. Shepple, know your place. Do not aspire to improve your lot in life. I’ll have none of that dissention amongst the shepple in my herd.”};-)

sarcasm off again

#122 dd on 04.25.12 at 1:49 pm

US growing? Housing coming out of the slump. We have heard it for months. Think again. US could be falling back into recession. Durable goods order off big time.

http://www.zerohedge.com/news/march-durable-good-implode-worse-lowest-wall-street-forecast-and-biggest-drop-january-2009

#123 Arb Watson on 04.25.12 at 1:50 pm

John,

All valid points, but the society at large does not care.

#124 Really on 04.25.12 at 1:56 pm

Garth,

You oositive comment on Buffet is disturbing. So much so that it makes me question evrything else you say.

Warren Buffet is helping the less privileged….bullshit.
He started as a smart “out of town” investor. He bought he believed and he held and prospered. That was the early “good” Buffet.
Since becoming a billionaire however he is just another insider prick trading on information.
Look at his investments and his alliances.
Look at the disgusting 80+ year old man who now when it suits him nearer to the end of his life he thinks everyone should pay their fair share. He has become a shill and a whore for the us government and for the fed.

The sooner people like him are gone the better. We don’t need 80 year old insider info trading billionaires telling us how to live and what to believe in.

My comment on Buffet, or anyone else, buying up foreclosures to turn them into rental stocks, stands. This is not a negative social action and in fact can benefit many people. Your remarks are childish and ageist. — Garth

#125 Regan on 04.25.12 at 2:12 pm

I know at least one person who purchased rental properties within striking distance from Toronto. Areas like Buffalo offer great ROI ratios – don’t expect capital gains but the income is good. However, you should already be an experienced landlord locally and be able to travel to your rental if needed, even if it’s just to meet before buying and find a property manager. I didn’t have the time to make it work. My friend did and pulls in about $1000/month in gross rental income from a $60K investment. This was an even sweeter deal before the Canadian dollar climbed too, since the rent is paid in USD. So… it’s risky and it’s work (not free money) but if you’re a good landlord you can definitely make it work. Garth can probably say if just investing in a US REIT is a similar return with less sweat equity.

#126 JRoss on 04.25.12 at 2:25 pm

DA,

Instead of spewing such drivel, I suggest you take 5 minutes to google ‘False Dichotomy’. You might learn something.

Then again, maybe not.

#127 Professor Stu Gatz on 04.25.12 at 3:12 pm

#78 Young Old Fart

“Mexico for me. There is a great Canadian contingent here and a few yanks as well. Media has so over blown any issues. We love it. I still get emails from friends who live in Canada and tell me how they hear gunshots almost every day. All I hear everyday is the surf….”

But of course! I have heard that the Mexican drug cartels have laid down their weapons and have become peace loving neighbours to their fellow Mexican countrymen. Too bad this new land of serenity didn’t exist for a former student of mine who was murdered in a Mexican nightclub and the other Canadian tourists who met the same fate in the past few years. Glad to hear Mexico has become such a land of peace and tranquility whilst we poor Canadians are dodging bullets on every street corner. Lucky you!

#128 Ernest Defarge on 04.25.12 at 3:20 pm

I wonder if Canada’s head honchos will be on trial for crime against Canada’s economy when the sh*ts hit the fan.

http://online.wsj.com/article/SB10001424052702303592404577364280643112316.html?mod=googlenews_wsj

#129 Dividend Yield Investor on 04.25.12 at 3:21 pm

#119 Derek R on 04.25.12 at 1:24 pm
#116 Dividend Yield Investor on 04.25.12 at 12:49 pm wrote:
The Canadian situation is also an economic colony of China with your natural resource sales.

Derek,

You are quite correct, for I should have stated that Canada is a colony of the U.S. and China, for both are in recession; this will be the catalysis of popping your debt bubble.

Actually the high prices of RE that you are experiencing is only a syndrome of debt gone wild. This culture of debt is every where to be seen – your stock and bond market, and of course obviously RE. Coupled with excessive consumer spending.

All I can say, is when the smash occurs, “welcome to the club!”

Bye the way, my opinions are emotionally neutral, for I grew up in north east Ohio [east of Cleveland] and more importantly we have relatives in GTA plus a crazy cousin in [he knows how to party] in Montreal.

Best Wishes,
Dividend Man!

#130 Canadian Watchdog on 04.25.12 at 3:49 pm

Genworth Financial Inc. credit default swaps pricing at 43% chance of default within five years. http://www.businessweek.com/news/2012-04-24/genworth-credibility-eroded-as-australia-plan-shelved-mortgages

#131 steev on 04.25.12 at 3:49 pm

#124 Really on 04.25.12 at 1:56 pm

Your comments on Warren Buffet are disturbing. What do you know of the man?

In June 2006 he made the world’s largest charitable donation ever. EVER.

He’s openly called for higher tax rates on the rich to help close the wealth divide in America.

His company, Berkshire Hathaway, is considered a paragon compared to the Goldman Sachs and BPs of the world.

Is his work life balance kinda wonky compared to the rest of us? You bet, but in no way does that make him unethical.

#132 alsiem on 04.25.12 at 3:51 pm

#104 Erika,

You don’t understand why there are no listings? Really? Take me for example.

I live in Toronto and have a smallish mortgage. However, any house that I would want to move to is massively overpriced even in comparision to my massively overpriced starter home. If I can’t move, then you can’t move (up and down the chain).

#133 VICTORIA TEA PARTY on 04.25.12 at 3:57 pm

RETIRING IN CHINA? NO, APPARENTLY…

In the last several years the Chinese have fully adopted North America and Europe’s favourite INDUSTRIAL DISEASE, putting too much faith in the auto industry!
Fraught as it is with private/public/union connivances all of which lead to crappy cars being built for feckless consumers who then pay too much for them, there is this bellwether that says it all about Mainland China’s near-term economic prospects and the future of HAM real estate on our makes-no-sense West Coast:

“…(Bloomberg April 24, 2012)

Tire demand in China, the largest rubber consumer, is growing at a slower pace than last year as the nation’seconomic expansion is decelerating, said an executive at Bridgestone Corp. the (world’s) biggest tiremaker.

“The Chinese market is in an adjustment phase,” Vice President Makio Ohashi said in an interview yesterday.

Growth in tire sales for trucks and buses, or half of the country’s demand, may slow to near the rate of gross domestic product expansion at 7.5 to 8 percent annually from last year’s 11 percent…Passenger-car tire sales are also slowing from last year’s 16 percent expansion…

China’s passenger-car sales fell 1.3 per cent in the three months ended March 31, the first decline since the first quarter of 2005.

Rubber futures on the Tokyo Commodity Exchange have lost 9.1 per cent since March amid concerns the sovereign-debt crisis in Europe may derail the global recovery…”

ALREADY BAILING FROM CHINA?

“…Bridgestone forecasts Indian demand for replacement tires for trucks and buses will grow 39 percent this year from last year, while demand for passenger-car tires will expand 15 percent.

Tire use in Thailand is expected to grow 24 percent for trucks and buses, and 13 per cent for passenger-car tires…”

What a difference one year makes. Last year China was an invincible trading force upon this world with major diplomatic and military potential overtones.

Now?

It’s economy is slowing and consumers are beginning to burn out.

It took the West more than a century to cook our economic geese.

It’s taken China about half a decade to burn its Peking [email protected]?

#134 spaceman on 04.25.12 at 3:57 pm

http://business.financialpost.com/2012/03/29/ottawa-to-toughen-cmhc-oversight/

Carney says we are all paying to much for houses, and F is about to clamp down on CMHC, oh ya CMHC is rationing the money now to lenders.

F is sitting on a powder keg, he knows he is doomed one way or the other. He hopes for a slow deflation of the bubble, that would look better for him, but if he does nothing, the inevitable crash will be even worse.

I would not want to be in his shoes… but what the crap, the two of them created this mess in the first place.

#135 Really on 04.25.12 at 4:47 pm

#124 Really on 04.25.12 at 1:56 pm

Your comments on Warren Buffet are disturbing. What do you know of the man?

In June 2006 he made the world’s largest charitable donation ever. EVER.

He’s openly called for higher tax rates on the rich to help close the wealth divide in America.

His company, Berkshire Hathaway, is considered a paragon compared to the Goldman Sachs and BPs of the world.

Is his work life balance kinda wonky compared to the rest of us? You bet, but in no way does that make him unethical.


Hey Steev,

I think you should have a close look at Buffets business and his partners and he source of his wealth.

We should measure him by his generosity?? Really?? Think about that before you even type it next time.

I see you’ve “contrasted” him to Goldman Sachs…..that makes you uninformed. Maybe spend some time and actually do some reasearch and find out if he is connected to Goldman Sachs. Maybe type that into the Google search engine.

The end NEVER justifies the means – if the “means” are evil.
Buffets age is irrelevant except that he is being generous with his dirty money and that he is setting an example at a stage in life where it’s meaningless to him. There is no sacrifice for warren buffet to say tax me more. He is simply a mouthpiece in his twilight paying back chips to those who helped him along.

Garth you can say my comment about buffet is childish – but it has NOTHING to do with his age- except where it’s convenient for him to be a bs role model.

He had a great investment strategy, the herd still thinks its the way to invest. Buy hold and prosper. Yeah.

#136 bigrider on 04.25.12 at 5:12 pm

#70 Nonno to bigrider- regarding Friedberg hedge.

I wouldn’t even pretend to try and comment on them. Absolutely incredible returns.

#83 In God and Garth we trust.

Sarcasm noted.

#137 Smoking Man on 04.25.12 at 5:15 pm

#57 Kale on 04.25.12 at 1:32 am
Smoking Man you plugged ERF yesterday since you are ‘feeling a bottom’.

Forecasted next year earnings, 1.04/share
Current dividend, 2.16/share

If I wanted a time bomb I’d line up for a Vancouver condo.
…………………………………………

Really?

You check the close today ba hahahahahahahah

That’s how you pick em baby .

#138 Nonna Nicola on 04.25.12 at 5:20 pm

NICOLA!!!!

ima getinga tireda wit u drinkina Dinos wino, leava da nice man Biga Rida alone, go ana clean da pige pena and afder dat we a gona do a tomato sauca. Ima gona a slapa u arounda if u donta hurry up.

Enougha. — Garth

#139 Nonna Nicola on 04.25.12 at 5:28 pm

i forget to apologizo to Garth, my husban sometime trya to be a biga shota, but he hava no moneta, i taka cara the moneta because he drinka to much

#140 Grantmi on 04.25.12 at 5:33 pm

#107 Canadian Watchdog on 04.25.12 at 12:16 pm
Say bye bye to cash payments Canada. http://ca.reuters.com/article/topNews/idCABRE83O0LT20120425

In South Korea, for example, residents have used touch-and-go mass transit cards for years. But only a limited number of stores can process such transactions and phone-based payments have yet to take off.

CW … Do you think retailers will ever allow cash as a non-payment??? Guess again.

You,ve obviously never owned a family retail business. The biggest way to hide money and not pay taxes EVER!!!!!!

Payment by cell phone will be traceable. Cash… NOT!

#141 maka on 04.25.12 at 5:49 pm

[First, the latest news: American house prices continue to go down. ]

Patiently waiting to buy my dream house – the big ‘White House’ in DC.

#142 yanz on 04.25.12 at 5:50 pm

@#78 — “Media has so over blown any issues. We love it. I still get emails from friends who live in Canada and tell me how they hear gunshots almost every day.” —-> one of the most stupid comments I’ve read in this blog… jesus….

let me know when canada has 8+ drug cartels, and a fully blown, gory, bone-chilling civil war
http://en.wikipedia.org/wiki/Mexican_Drug_War

It’s a great read actually , very well explained, and makes you feel very sad for the mexican people, who are literally scared of leaving their homes… or even using their computers…
http://articles.cnn.com/2011-09-14/world/mexico.violence_1_zetas-cartel-social-media-users-nuevo-laredo?_s=PM:WORLD

Yeah… so many severed heads found in Canada’s tourist spots… Like in Acapulco, beautiful tourist destination
http://www.huffingtonpost.com/2011/09/27/acapulco-severed-heads-mexico_n_984263.html

So many mass graves in Canada… probably that’s where the shots that your friends hear so often come from… those damn killing fields…
http://www.huffingtonpost.com/2012/03/08/monterrey-burial-site_n_1329041.html

This is not the media overblowing anything, this is the media reporting on a very real issue, a war that has taken tens of thousands of lives in a very short span of time… an issue that you clearly have no clue about. Canada is a gem, is a great place, and offers a quality of life that very few other countries can beat. I’m grateful for the life I have here, for being able to live in this country. Yeah we have a bad RE bubble, a robot for a prime minister, and a bunch of other issues that are very real and important — gangs, fighter jet crap, Attawapiskat…but dude, never ever again compare Canada to Mexico in regards to safety or the political situation. Just… don’t.

#143 Nostradamus Le Mad Vlad on 04.25.12 at 6:22 pm


Thought For The Day! — I realized from a very early stage that the financial market is a wholly rigged job. There’s no chance that investors have in this market.” — Bernie Madoff (wrh.com)
*
14:22 clip See what Harper’s planning for students, and Kannnaduhh’z Economic Collapse Says so on the headline; 2:46 clip Student loan interest set to balloon; 12:24 clip Return of govt. issued money, not US Fed or other central banks; Insider to Merkel “A very clever piece of propaganda to put the onus back onto Germany for the coming problems.” wrh.com; Insurers Bleeding us dry; Borders to France temporarily closed. “The money-junkies are getting nervous. They know we know!” wrh.com; Unplugging NAmericans from the matrix; Detroit skyrocketing In self-defense killings. No police, gun control coming in. Progress? Plus — BoA; Germany Complicated headline; Destroying Retirement Plans; Buy A Boat! “The stealth ship prototype the US Navy built for $195 million is on the auction block. Current bid. $10,000.” wrh.com. Better investment than RE? 1:37 clip US SS Disability Benefits to run dry by 2016, which is the next election; Hurting Economy Keep the Mexicans in.

UN Plan for World It ain’t pretty, and it ain’t gonna work; VAT tax, sex tax, any more taxes? 5:40 clip Rich farmers?
*
7:03 clip US provoking war with China, which leaves the door open for an Israeli strike on Iran (then TSHTF); Redirecting URL virus question – answer; You’re Fired! Different variation on a theme; Social / Ethnic Cleansing in UK; Jackass comment Expression says it better; 3:13 clip CIA funding and m$m manipulation.

Iran unlikely to make bomb, according to Israel military head so why all the fuss? Mad Cow Disease confirmed in California, and South Korea suspends US beef imports. So much for their war games; It’s a Mystery Space, that is; CNN loses half its viewers. Good – serves them right for lying; Monsanto Another way to kill off farmers; First, it was Germany and France ‘temporarily’ closing their borers. Now, it’s Spain and France. See a pattern developing? Tiger Mosquitoes China’s response to the west? CISPA Cartoon first is good; Artificial Sweeteners Lose them. Switch to Stevia or other sweeteners; Proview More legal jargon; New TVs “I remember The Jetsons episode which had a cereal box that came with a TV set on the back. Looks like we caught up with Hanna Barbera!” wrh.com; Trayvon Martin and gun control, part of Obomba’s second term but he may not make it.

#144 Timing is Everything on 04.25.12 at 6:23 pm

#100 Intuitive Missus

Thanks for the info.

#145 ozy - native americans on 04.25.12 at 6:24 pm

I guess the americans are paying for sins 300 years ago, if you think honestly for a second, it was a lot of native american land being focefully occupied. So, Karma is back to bite their successors asses really hard.
How many of american states have given land back to american indians or apologized for past crimes? Canada\Ontario did it and we are not dying under a real estate bust. Moderation, modesty and accountability, non-religios moral values are probabbly not very well taught in american public schools. That’s the root cause felles.

#146 Fisc on 04.25.12 at 6:38 pm

Garth, could you comment this:

““The issue that pushes them near their lending limit is the desire of some of the financial institutions to purchase portfolio insurance for their low ratio mortgages,” Mr. Flaherty said.

“That’s not the way most people usually think of CMHC.””

http://business.financialpost.com/2012/04/25/cmhc-set-to-be-under-osfi-supervision/

Holy crap. I agree with F. — Garth

#147 Tremblant on 04.25.12 at 6:40 pm

An excellent web site to look at Florida homes and their recent selling price , their past selling prices and compared to their neighbours is http://www.trulia.com

#148 45north on 04.25.12 at 7:05 pm

Peter (NYC): Most Canadians can’t divorce the notion of investment for income vs. a second home in a warm location.

Regan: Garth can probably say if just investing in a US REIT is a similar return with less sweat equity.

yeah, the idea of finding the perfect vacation spot that is going to pay off is just a dream. I think that US REIT could be a good investment – let somebody else figure out “Save Our Homes” or Proposition 13.

#149 };-) aka DA on 04.25.12 at 7:12 pm

#126JRoss on 04.25.12 at 2:25 pm

Careful now – don’t be losing sight of the forest for the trees.

};-)

#150 Onemorething on 04.25.12 at 7:34 pm

#115 Arb Watson on 04.25.12 at 12:48 pm

Onemorething,

Inflation is already here. It has been exported to Europe and Asia if you haven’t noticed.

We’re talking Canada here bro, and the US and everywhere else money printing has provided cheap entries to everything. STILL!

Debt Deflation cuts the top off all these high priced items where only a side of inflation shows in daily prices. When the value of your house car boat vacation home and investments are halved and printing money is no longer an option, then you’ll see real inflation.

When your recourse mortgage goes belly up and your selling off the furniture in your McMansion to feed your family, only then will you look at the price of bread, fuel and beer!

#151 Canadian Watchdog on 04.25.12 at 7:37 pm

#140 Grantmi

No comment. http://i49.tinypic.com/21jp3kp.png

#152 Bigrider on 04.25.12 at 7:40 pm

Three motorcycle fatalities so far this year Garth( another today on missisauga road).
Enjoyed my day today on mine but I can tell you that drivers aren’t quite used to seeing them yet on the road as I was in the city proper and had to deal with lane drifts, distracted drivers and one scurrying vehicle through a construction lane restriction.

Ride carefully Garth . I enjoy this blog.

#153 Fabrega on 04.25.12 at 7:50 pm

#84 Peter (NYC)
What do you mean by “spend your money more wisely and buy income property + all inclusive vacation once per year” ?

#154 Derek R on 04.25.12 at 7:54 pm

#129 Dividend Yield Investor on 04.25.12 at 3:21 pm wrote:
Actually the high prices of RE that you are experiencing is only a syndrome of debt gone wild. This culture of debt is every where to be seen – your stock and bond market, and of course obviously RE. Coupled with excessive consumer spending.

All sadly true, DYI. It depresses me that Canada has learned nothing from the experiences of the other Western countries over the last few years.

#155 TurnerNation on 04.25.12 at 8:01 pm

Smoking man nice call on ERF I picked up some near the bottom today. Very short term trade. I went by 60 minute chart alone.

#156 Dontcallmeshirley on 04.25.12 at 8:02 pm

Financial Post reporting Flaherty will, on Thursday, announce legislation putting CHMC under OSFI supervision, and the role of insured mortgages in covered bonds.

Any good, educated guesses on what’s coming here?

Exactly what this miserable bog said in March. — Garth

#157 Mr Buyer on 04.25.12 at 8:03 pm

#145 ozy – native americans on 04.25.12 at 6:24 pm
I guess the americans are paying for sins 300 years ago, if you think honestly for a second, it was a lot of native american land being focefully occupied.
…………………………………………………………………….
How do you think present day native american’s ancestors got the land in the first place? They occupied land inhabited by the first wave of setters that came before them when a previous ice bridge existed between Alaska and Russia. All present day inhabitants of North America are here because the land was occupied and taken from previous settlers. We all have a Karmic debt including the people we identify as Native Americans

#158 Kale on 04.25.12 at 8:04 pm

#137 Smoking Man on 04.25.12 at 5:15 pm

“Really?

You check the close today ba hahahahahahahah

That’s how you pick em baby .”

A 1.3% bounce off the 52 week low? Nevermind you’re right, best back the truck up.

#159 Dontcallmeshirley on 04.25.12 at 8:28 pm

Exactly what this miserable bog said in March. — Garth

——-

Yes, yes, yes…you mentioned it.

I’m asking for informed speculation on what the specifics might be.

The buzz on the covered bonds is that insured mortgages won’t be allowed as collateral. So maybe +0.50% in fundind cost.

What’s the OSFI supervision going to do for us?

I don’t want to wait for that blowhard, windbag Flaherty’s Thursday public address.

I’d guess it’s all about the end of CMHC insurance on conventional loans, new securitization guidelines and a reiteration of OSFI’s tough new mortgage regs. — Garth

#160 Canadian Watchdog on 04.25.12 at 8:41 pm

Exactly what this miserable bog said in March. — Garth

You’re taking the bait too huh? I hope not, because the biggest non-news event was quietly released today right under everyone’s nose.

Forget CMHC, the banks already got what they wanted. Now they can write insurance themselves into perpetuity.

#161 Smoking Man on 04.25.12 at 8:59 pm

Kale. Maybe your new here. I had a Near death expence , had a tour of the universe. Went throught the universal consiounes consolidator. Now I can see the futre as demonstrated on this blog and globe for the last 4 years. The bounce was my tour guide. A stripper angle

#162 Dontcallmeshirley on 04.25.12 at 9:03 pm

I’d guess it’s all about the end of CMHC insurance on conventional loans, new securitization guidelines and a reiteration of OSFI’s tough new mortgage regs. — Garth

——-

Ah yes, no more insurance on conventional is a good call. What’s your probability on a raise of CMHC’s insurance limit? I would expect less than 5% probability.

#163 steev on 04.25.12 at 10:03 pm

#135 Really on 04.25.12 at 4:47 pm

Actually I chose Goldman Sachs for a reason. Buffet first acquired part of it in the 80s, however soon it started to smell. Not wanting to be associated with a rotten company Berkshire exited the position.

Berkshire again acquired part of Goldman during the GFC. This was not a large acquisition for Berkshire, 3.5 Billion was only about 2% of the company.

The last time Berkshire had negative press was during the Lubrizol affair. During which Berkshire went to great efforts to bring to light what had happened behind closed doors…and Sokol was let go.

I find it interesting you critisize buy and hold. Buy and hold works for Berkshire as it allows it to attract company owners looking for an exit strategy that won’t see their hard work broken up and sold off to the highest bidder.

Maybe you’re right about Buffet being crooked…I just find that hard to imagine when he’s lived in the same modest house for much of his life considering his means. Usually the 1% are associated with greed, for whatever reason he isn’t.

Cheers

SB

#164 Tony on 04.25.12 at 11:54 pm

Re: #6 Nick on 04.24.12 at 9:26 pm

I’ve got news for you pal, interest rates are on the way down not up in both Canada and America.

#165 Peter NYC on 04.26.12 at 5:49 am

153 fabrega – instead of buying a condo in Florida – buy an income producing multi unit property in the US. Bank your income. Use a portion of the income to pay for an all inclusive vacation each year

#166 Money News | Canadian Performer's Money on 04.27.12 at 4:32 am

[…] Is it a good time for Canadians to buy U.S. real estate? Garth Turner: America […]

#167 SRV on 04.28.12 at 11:34 am

Well that was close Garth… really thought you were jumping the shark on this one, but nice to see you’ve finally seen the light on US R/E (why aren’t US corporations scooping them up if they’re such a bargain… and of course they would if money could be made).

So… our banksters, who have run out of suckers to sign up for over priced Canadian R/E, are now pushing the US alternative… morally bankrupt vultures all!