Excess etc.

Would you pay $1,488,000 for the little house below in Van’s Kitsilano neighbourhood (not the best, not the worst), with a nine-year-old reno on a 33-foot lot corner lot? Well, actually somebody shelled out $1,525,000 almost exactly 90 days ago. Here’s the sold listing.

Now, here’s the new listing. Different realtor. Same pictures. Same words. But new price. Now it can be yours for $1,798,000.

“It’s the same house,” says Jason. “We know because we saw it.” Jason and his wife are university professors at (sort of) nearby UBC, and they’re not impressed. “A roughly 250K mark-up in the past 3 months?…. It shows the absolute greed and insanity of this free-based capitalism…… I thought you might find this amusing…..”

Sure do, Jason. We’re at an interesting intersection of human emotion and perception. Sales in Vancouver are down 19% now year-over-year, with average SFHs cheaper by 9.8% – some say one quarter of the way to the first stage of correction. But at the same time, CHMC in a new report claims there has been ‘no clear evidence’ of a real estate bubble, even though prices rose 130% and a single detached home still carries a median price of $1 million. Oh yeah, and it takes (according to RBC) 72% of pre-tax income for the average family to own a home, which is more money than they actually have.

It would be absurd if not hilarious. Here’s Global TV, for example, interviewing ‘experts’ making excuses for declining sales, insisting a correction of 10% or 15% is crazy, even as it takes place.

“The message to buyers,” says this proud network, “is the economy is in reasonable shape, there’s a lot supply out there, and interest rates are still low. So just because sales are slumping, don’t bank on prices doing the same.”

“My wife and I are no longer so angry about the market,” replies Jason, who sounds pissed to me. “We own a 1350 sq. foot duplex in Kitsilano that is almost paid off and are now no longer interested in moving up. We have a different attitude in the sense that we are convinced the market is turning down , as there have been 100K -150K price corrections (typically going down) in a few short weeks on many properties in Kits over the past few months (since February)….It seems as though nobody has told the listing agent of the house above that the direction of the wind has now changed….

“Anyways, we are no longer looking to upgrade from our smallish place and we divorced our real estate agent a few weeks ago who kept trying to convince us to bid very high on places in order to “win”…….we came to the conclusion that our agents were not representing the market as it is now and were too caught up in the hype…. and effectively were giving us very bad advice…….. We are happy to sit on our hands.”

This goes to the point I’ve been making in recent posts. Interest rates are probably irrelevant. Tough new rules from the banking cop may not matter. The fact CMHC is burning through all its insurance money could be moot. Greed and excess, leading to anger and disgust, are the most powerful economic forces a housing market can face. When buyers no longer wish to buy, the snap-back can be brutal.

Vendors, agents, media pumpers, Re/Max marketing dipsticks along with self-serving economists and ‘experts’ have all played a role in helping Canadians price themselves out of their own homes. Real estate’s become so expensive it’s crowded out savings and investing for most families, created a towering pile of debt. The consequences of this are so obvious most people miss them.

But then, most people don’t come here. Way too scary.

Speaking of which, a few words seem necessary on the photo this blog carried yesterday, which managed to turn so many people into xenophobic race warriors. Yes, this one…

This crowd showed up at the preview for a new development of 600 homes to be built in a distant corner of the GTA, ranging in price from half a million to the full seven figures. They did not come to buy, but to view plans. Demand has been so monumental the builders are running an online lottery to see who actually gets to visit a salesperson. Of course, after ‘winning’ an appointment, every single prospect will buy. Clever.

Did the developer target the large local Chinese population? Obviously. And successfully. Anyone who’s visited Markham or Unionville lately knows the population is as solidly Chinese-Canadian as parts of Brampton are universally Indo-Canadian. It apparently doesn’t take too much marketing to get a thousand people from the region to flood into a sales centre, littering neighbouring roads with their vehicles.

But is this, as so many stated here yesterday, HAM? That acronym means Hot Asian Money and refers to horny Mainland Chinese who drop from the skies with bags of money, supposedly driving up prices and irritating natives who then feel forced out of their birth neighbourhoods.

Does it seem a little absurd to you that a shuttle from Beijing would fill with lusty rich Chinese determined to target a cow pasture, 45 minutes north of Toronto, where a mess of suburban houses have yet to be built? Or is it just the sight of a few hundred local Chinese families ready to buy McMansions that had so many yahoos talking out of their butts?

This is a financial blog. If a group of people want to do silly things with their money, buying at the top of an asset cycle, and do it en masse (like most of the folks in Vancouver), then tough for them. They, too, and will reap what they sow.

Now, move on.

210 comments ↓

#1 TurnerNation on 05.17.12 at 8:51 pm

2nd!

#2 99% on 05.17.12 at 8:52 pm

Garth is a genius. Today, my boomer SIL has announced that they are planning to sell their home to downsize, pocket the difference to fund their retirement. Both SIL and BIL are in their late 50’s. The boomer RE dump has started. More inventory. Less HAM. More bank regs. Less credit. Gee, I wonder what’s going to happen?

#3 OwlEyes on 05.17.12 at 8:56 pm

Phurrsftstt!

#4 TurnerNation on 05.17.12 at 8:59 pm

Ready for Facebook Fryday?! IPO day tomorrow.

#5 mac on 05.17.12 at 8:59 pm

“Does it seem a little absurd to you that a shuttle from Beijing would fill with lusty rich Chinese determined to target a cow pasture, 45 minutes north of Toronto, where a mess of suburban houses have yet to be built?”

Garth, you’re about to get schooled on international finance.

#6 East Van on 05.17.12 at 9:00 pm

Seems Garth is just plain wrong on re.
BC is bubble free:

http://www.vancouversun.com/Condo+king+says+talk+bubble+just/6640328/story.html

http://www.globaltvbc.com/report+says+no+clear+evidence+of+a+real+estate+bubble+in+bc/6442642870/story.html

http://www.surreyleader.com/business/150837865.html

http://www.mapleridgenews.com/business/151774025.html

#7 Sub on 05.17.12 at 9:02 pm

Hey Garth,

Long time reader and admirer from Sydney, Australia (yeah yeah.. say something sarcastic).

While I think you will eventually be right about deleveraging hitting property prices hard in Canada and Australia (slow melt over 10-15 years scenario), I’m not 100% sold on your balanced portfolio earning 7% compunding pre-tax over the long term. Something doesn’t seem right for the equity market, the volatility seems to have risen quite a bit. Just interested in what you think of the medium term valuations (2-5 years) for global stock markets.

Thanks

#8 house burden on 05.17.12 at 9:06 pm

I remember going to Vegas just before the crash.

They were shuttering people to buy timeshared condo’s and hotel units.

We went through the motions and got free tickets to a show and a trip back to Vegas.

The atmosphere seems too familiar. We never bought (luckily) but the selling pressure was high, buy now or be left out…. You won’t get another chance… Sale person was disappointed in us for not taking the bait, but looking back on it were glad we didn’t. I remember them pitching, the same old themes

– you can’t lose,
– they are not making more land, population can only grow
– great investment

Yeah, now its just barren desert land, with not hope/ future.,,,,

#9 furst on 05.17.12 at 9:08 pm

Nope. OwlEyes….I’m FURRSST!

#10 Steve Thompson on 05.17.12 at 9:09 pm

They were saying the same thing in Los Angeles in 2005:

http://www.businessweek.com/magazine/content/05_15/b3928001_mz001.htm

Prices have dropped by 45 percent since then. Oops!

#11 harbottle on 05.17.12 at 9:12 pm

FUUUUUUUUUUUUUUUURST

#12 I'm stupid on 05.17.12 at 9:14 pm

I remember reading a stat in the US that had net worth based on ethnic background. Asian Americans topped the list. I’m wondering if it’s the same here. That would explain Ham just that the a is Canadian Asian.

#13 I'm stupid on 05.17.12 at 9:15 pm

Garth I had a question for you or anyone else. How long after I sell an equity can I buy it back and still be able to claim the capital loss?

Thirty days. — Garth

#14 Aussie Roy on 05.17.12 at 9:16 pm

Aussie Headlines

Real Estate Crash in China Underway: Foreign Funding Down 80%, Land Sales Down 57%, Starts Down 27%; Expect Chinese GDP to Plunge

Inquiring minds are reading an excellent report China Real Estate Unravels by Patrick Chovanec, a professor at Tsinghua University’s School of Economics and Management in Beijing, China.

Here are a few items of note.

Developers, burdened by 70% leverage ratios and loans threatening to come due, rushed to complete projects already in their pipeline, to put those units onto the market and raise cash.

That rush to complete inflated real estate investments, allegedly up 23.5% in the first quarter. Other statistics from the report tell the real story.

http://globaleconomicanalysis.blogspot.com.au/2012/05/real-estate-crash-in-china-underway.html

Historically high levels of corporate insolvency are tipped to continue in the economy’s struggling industries, despite this month’s hefty cut in interest rates.

http://www.theage.com.au/business/insolvencies-to-stay-at-record-highs-despite-rate-cuts-20120517-1ys6u.html

BHP Billiton has walked out on a joint venture to develop the Altia copper and silver deposit in Queensland, just a day after the company’s chairman and chief executive warned they would scale back on investments.

BHP Billiton chairman Jac Nasser yesterday backed away from the company’s commitment to spend $80 billion on growth projects over the next five years.

http://www.theage.com.au/business/bhp-walks-out-on-altia-venture-20120517-1yse2.html

More on Keen vs. Krugman

http://www.debtdeflation.com/blogs/2012/05/17/more-on-keen-vs-krugman/

http://www.debtdeflation.com/blogs/2012/05/15/paul-krugmans-economic-blinders-by-michael-hudson-2/

http://www.debtdeflation.com/blogs/2012/05/16/an-attack-on-paul-krugman/

#15 Smoking Man on 05.17.12 at 9:19 pm

Nothing to say today, burnt out.

3 hours, bringing Mom back to the nursing home from Princess Margret Hospital.

No wonder Condo’s are selling like hot cakes, who want’s to drive, Traffic is Nuts.

#16 Form Man on 05.17.12 at 9:19 pm

excellent post Garth !

there are a multitude of reasons why the housing market in Canada has developed into such a bubble, but continued rock bottom interest rates surely must be significant………

#17 WPG_Savant_Syndrome on 05.17.12 at 9:20 pm

Garth please don’t turn all liberal on us.

For most the issue is immigration NOT racism. People would be just as pissed off if there were clusters of German, Irish, Polish people coming to the country in droves and “contributing” to jacking up home prices.

Harder to spot, though, aren’t they? — Garth

#18 Toronto_CA on 05.17.12 at 9:22 pm

Totally agree with this blog entry. The FML Listings blog is all about being just disgusted with the greed of people and the state of the RE market in the GTA.

So many of my friends in their late 20s and early 30s here in Toronto make decent incomes but are just sickened by the state of the market, especially dubious bidding wars cooked up by Real Estate Agents (who have about as much popularity as the KKK). I’d rather continue to rent (which has not increased in the 4 years I’ve lived in my downtown condo) than feed the greed of some speculator/flipper who bought a place just to add $100k to the price and resell it.

#19 Stinky the Fish on 05.17.12 at 9:22 pm

How do you know an Asian has robbed your house? Math homework’s done, computer’s updated, and after two hours, the guy is still trying to pull out of the driveway. Alright, I’ll stop with the Asian jokes… I am half asian so I can get away with it.

Let’s face it. Population increase does not drive house prices. Credit loosening and credit availability does!

#20 mark on 05.17.12 at 9:25 pm

I pity the fools who sits in Tsur Somerville’s classes.

There’s some quality learnin’ you’ll git.

#21 Inglorious Investor on 05.17.12 at 9:27 pm

Good job putting things into perspective. The maniacal Canadian housing market sorely needs some perspective right now.

#22 John S on 05.17.12 at 9:29 pm

http://www.cbc.ca/news/canada/toronto/story/2012/05/17/toronto-condo-market.html

Now open overseas RE offices.. coming to a place near you in Shanghai and Mumbai.

#23 furst on 05.17.12 at 9:30 pm

Poem Greed etc. – A Furst production
Greed is good
G. Gecko knows best
The real estate hoards of Toronto
Follow blindly a road traveled by the fallen
Oblivious to the remains floating in the granite river

#24 lil RoNiE on 05.17.12 at 9:42 pm

if I was the developer for that housing complex I would start prices at over a million

its obvious that these people are oblivious with blinders on so why give them a break, I would be laughing all the way to the bank….booooooyyyyyaaaaaaaaa!!!!!

#25 Bo Xilai on 05.17.12 at 9:46 pm

Listing in Greater Vancouver cracked 18,300 today…

#26 XKR on 05.17.12 at 9:46 pm

” it takes (according to RBC) 72% of pre-tax income for the average family to own a home, which is more money than they actually have.”

This is getting silly. Really, will the bank even grant you a mortgage with that kind of carrying cost? I don’t think so.

#27 J.I.M. on 05.17.12 at 9:54 pm

I went on a real estate website for Calgary.
I has 3819 SFH and 1941 condo mls listings. Don’t know what to compare it to. Is that a little, a lot , or about right for this time of year. I do notice that prices in the 350k to 500k range have softened about 10% since I started to follow realestate in 2009

#28 Jonny on 05.17.12 at 9:55 pm

THE UPPER UNIONVILLE PEOPLE HAVE NOT CALL ME YET!!!!!

IT MAKES SENSE THAT GARTH MIGHT BE RIGHT AND HOUSE WILL CORRECT. BUT MY EMOTIONS IS BOSS, I CANNOT CONTROL MYSELF!!!!!!!!!!!!!!!!!ARGHHHH

#29 Mister Obvious on 05.17.12 at 9:56 pm

#7 Sub

“Something doesn’t seem right for the equity market, the volatility seems to have risen quite a bit.”
——————————

Really? Check the S&P 500 Volatility Index (VIX). The link below shows a graph of market volatility from 2008 to the present.

While there does seem to have been a slight uptick in the last week or so (up to 25, probably due to the Greece stiuation) its nothing compared to the huge spike we saw in October 2008 or the major spikes of May 2010 and August 2011.

However, I suppose anything could happen, eh?

http://tinyurl.com/cbmv8r7

#30 Ben on 05.17.12 at 9:59 pm

What I don’t get are the postage stamp size lots with vertical houses in Canada. What’s with that?

Here in Texas the average size lot is one acre with a ranch style bungalow that stretches across it.

You running out of land in Canada or something?

Of course your prices are beyond stupidity too.

#31 Raj on 05.17.12 at 10:02 pm

Bubble Everywhere!
“China Car Dealerships Struggle as Stockpiles Increase”

http://www.bloomberg.com/news/2012-05-17/china-car-dealerships-struggle-as-stockpiles-increase.html

#32 BC Bear on 05.17.12 at 10:03 pm

@East Van: The problem with the Condo King’s statement about $88 Billion equity in Boomers hands is finding the buyers with $88 Billion to allow them to exit. Local incomes don’t support the prices and foreign investment is minimal and declining…

#33 Stevie Wonder on 05.17.12 at 10:06 pm

Those are not HAM…they look like Mexicans to me.

PS This is Financial Blog…I thought this was a soft porn and book flogging site ?
I am cancelling my free subscription.

#34 lil RoNiE on 05.17.12 at 10:09 pm

smoking man why dont you take care of your mom instead of dropping her off in the nursing home, a man with so much money and such brilliance should help the one that brought him into the word…shizzle bro! pure disappointment

#35 Chiquita Banana on 05.17.12 at 10:12 pm

Re: #16 WPG_Savant_Syndrome “For most the issue is immigration NOT racism. People would be just as pissed off if there were clusters of German, Irish, Polish people coming to the country in droves and “contributing” to jacking up home prices.”

I’m pretty sure those clusters already arrived, and your parents or grandparents were among them. Best drop the xenophobic entitlement attitude in the new world or risk exposing yourself as a racist a**hole.

#36 Bottoms_Up on 05.17.12 at 10:13 pm

Garth, why is the city of Ottawa never mentioned as being in a bubble?

Only $630,000 for a 2 br town next to the highway:

http://www.realtor.ca/propertyDetails.aspx?propertyId=11873198&PidKey=1750345435

Or, go on the cheap, $450,000:

http://comfree.com/house-for-sale-ottawa-ontario-314470?from=realtor.ca

Granted these places aren’t selling…the first one is probably overpriced by $200,000, and the 2nd one $100,000.

Talking about greed…

#37 Don't read his post on 05.17.12 at 10:15 pm

What do you think about segregated funds? I’m thinking about stuffing most of my money there

Bad idea. — Garth

#38 Bottoms_Up on 05.17.12 at 10:18 pm

And you gotta love this 50 yr old SFH listed for $510,000
with pictures from the Fall of 2011 [and fall comes early in Ottawa]!! lol

http://www.realtor.ca/propertyDetails.aspx?propertyId=11890746&PidKey=740768595

#39 John G. Young on 05.17.12 at 10:22 pm

“It shows the absolute greed and insanity of this free-based capitalism…”

Did he mean “freebase capitalism”? I’d say that captures it perfectly.

#40 Bottoms_Up on 05.17.12 at 10:25 pm

And this! My forever move-up home, the home of my dreams.

Crack shack or Mansion lovers beware, you have competition.

And for only $750,000!

http://www.realtor.ca/propertyDetails.aspx?propertyId=11933113&PidKey=-1989055359

#41 Don't read his post on 05.17.12 at 10:28 pm

I knew youd say that. Thanks! I get these crazy thoughts sometimes. Can you direct me to a good portfolio manager. But I don’t have 200k to invest. Is more like 30k with a heloc of 50k. I own 40% of my half million dollar house. And a family income of 100k. Also I rent my house out for $1800/month while I live for free elsewhere…..mom and dad. I’m tired of trading ETF’s

#42 Inglorious Investor on 05.17.12 at 10:39 pm

#147 Junius on 05.17.12 at 11:27 am

“He is arguing against a straw man.”
Really? You should watch this video:
http://www.youtube.com/watch?v=SkesgECRXtM in which:

• Keen explicitly says his plan is not a debt write-off. It’s an inflationary pay-off (my words) via money printing of the worst kind.

• He ignores the effect his plan would have on savings (it would destroy them and he knows it). His justification is that the system has failed. Sure, so punish everyone, particularly those consumers and business people who were prudent and lived within their means.

• It’s obvious Keen himself has no idea how his scheme could actually be implemented in practical terms. A better informed interviewer would have torn him to shreds.

Keen’s “solution” to the global debt crisis is akin to cleaning the debris off a beach with a tsunami. In the end it would accomplish nothing good and give everyone even more reason to get to back into debt. Then what?

Keen’s plan is predicated on the notion that the entire current financial system can be demolished and rebuilt from the ground up in his self-agrandized image. Perhaps at some point the current system will collapse. But it won’t happen just to accommodate his plan.

I agree with much of what Keen says, but he works with theory and mathematical models. He is just as dangerous as the economists over whom he claims superiority and the Wall Street quants who use mathematical alchemy to pretend risk doesn’t exit.

IMO he should ensconce himself inside his ivory tower with the ghosts of Schempeter and Minsky and stay there.

#43 timbo on 05.17.12 at 10:41 pm

http://www.economonitor.com/blog/2012/05/a-brief-history-lesson-how-we-ended-glass-steagall/?utm_source=rss&utm_medium=rss&utm_campaign=a-brief-history-lesson-how-we-ended-glass-steagall

great history on how we all became speculators……

http://www.chinapost.com.tw/business/europe/2012/05/17/341416/Bankers-business.htm

“Moody’s downgrade of 26 Italian banks is the first round of a wave of credit rating cuts that are expected to hit dozens of eurozone lenders, adding to their difficulties in raising funds and exacerbating an existing credit crunch.”

yup, China cannot be happy when their biggest trading partner is slowly tipping into the unknown…..

#44 Mean Gene on 05.17.12 at 10:45 pm

To quote the fiction character Nelson Muntz…. HA HA!!!

http://en.wikipedia.org/wiki/Nelson_Muntz

#45 Karie on 05.17.12 at 10:59 pm

Wages haven’t gone up but people are using the money they’ve gained on selling their homes to keep buying up and up and up. I bought my first house 15 years ago for $150,000, made money on that, then bought for $250,000 made money on that, bought our current house for $400,000 using the profits of our previous house sale. I could make money on it now in this hot market where I live but I have stopped because I don’t want to move up and be that Greater Fool but then I think – Am I being too conservative? Maybe the market is going to keep going up and I’m missing out. I missed out on buying 2 homes I was eyeing that are now worth over a million because I was conservative and afraid of stretching myself too much.

My friend bought his house for $590,000 4 years ago in my ‘hood and his next door neighbour just sold for $865,000 so this is how you get tempted to keep going up and up. That’s why people are saying real estate is like crack and it’s hard to stop buying.

I would love to know what people are going to do if the market does tank. Will you move? Continue renting? Buy multiple properties? Does anyone have a plan or do people just want to say they were right?

#46 Vancouver's "Condo King" on 05.17.12 at 11:02 pm

Steven Quinn of CBC asks Bob Rennie the tough questions with no real answers from Mr. Rennie.

http://bit.ly/KGas8U

#47 timbo on 05.17.12 at 11:03 pm

As a side note, if anyone is interested

Greece has a election date set for June 17th and it will be a fascinating example of outside influences trying to set a compliant government. We shall see Garth if you are right and this is but a speed bump but my hunch is that we might see another Lehman brothers event that will require a massive injection of cash. It wont collapse the market but it will be center stage for a year or two.

http://yanisvaroufakis.eu/

#48 Smoking Man on 05.17.12 at 11:07 pm

Just saw my second UFO jet was on the down wind leg of 23 left, it shadowed it. Came in over the lake at about browns line, took a right, was about 500 feet of it’s wing tip.

Was like a round Orange flame, about a mile down leg from my view it vanished.

Amazing.

#34 lil RoNiE on 05.17.12 at 10:09 pm
smoking man why dont you take care of your mom instead of dropping her off in the nursing home, a man with so much money and such brilliance should help the one that brought him into the word…shizzle bro! pure disappointmen

She is 92, craps herself, pops is still going good at 95 with no mind, wonders off, pee’s him self 5 times a day. They are in the best place. Amazing what a couple of brown ones slipped to the staff will get you in terms of service

Plus got a wife that don’t like changing diapers, or likes a pee drenched pair of pants sitting on her couch, suggestions smart ass?

#49 WPG_Savant_Syndrome on 05.17.12 at 11:07 pm

@Chiquita Banana

xenophobia does not = racist

You missed the point but most bedwetting liberals do.

#50 Smoking Man on 05.17.12 at 11:07 pm

I’m getting an enema tomorrow for my birthday. It’s my gift to myself, you only turn sixty once.

I think a lot of buyers in Victoria feel like they’ve had one recently.

#51 Party On Garth on 05.17.12 at 11:21 pm

^^^ you’re “tired of trading ETF’s” but you were considering buying seg funds? That makes no sense, unless you are planning on declaring bankruptcy in the next 2 years and are trying to shelter your assets.

#52 Phil on 05.17.12 at 11:22 pm

@49 bang on.. Haha.. Garth and every other liberal want us to just smile and nod as we are priced out of our cities that we were born in and our parents were born in and our grandparents were born in and built. Could you imagine if that happened to any other group of people situated in any other non western/liberal country in the world?? And all our liberal media would applaud them for standing up for themselves. The facts are that the people in that picture were either born abroad or came over post 1980. It really doesnt matter when. It’s splitting hairs. The results are the same, coming from the same government policy. Hand wring all you want.

Sad. — Garth

#53 PoorgEoisie on 05.17.12 at 11:28 pm

Bottoms up, I wouldn’t worry Ottawa is probably the boomer capital of Canada and 12000 gov’t jobs will be leaving along with your competition..

#54 ANONYMOUS on 05.17.12 at 11:29 pm

I just read this comment from a lady. I’m not sure if she’s correct or not :

(” Markham and other area are sadly now considered commuting distance to Toronto, making them very attractive for newcomers who don’t want to live in the city but still need to work there.

Canada is still a heck of a lot cheaper than most European countries and most other 1st world nations. Canadian home prices are only about half of what they will be in a few years time, they are BARGAINS compared to most of Europe, and anyone who doesn’t understand this fact simply has not lived and traveled to Europe enough to wake up and smell the putrid truth! ” )

Wow !

#55 Diane on 05.17.12 at 11:34 pm

I agree with #7 Sub. I have been waiting to buy our first home in 2007 in Lower Mainland and saving the money in GICs. But I finally gave up last year to pull money out of GICs (Garth hates them) and invest in bank stocks and bonds and some gold. But I have been loosing quite a bit. I wish I had left the money in GICs. I wouldn’t be so stressed out about the market and wouldn’t be in the red.

Nowhere did I counsel anyone to buy individual stocks, banks or otherwise. I specifically warned against impending losses in gold. And bond prices are actually up. I’ve also spelled out the dangers of DIY investing, so the leap from GICs to equities was likely foolhardy for someone with your low tolerance for risk and short-term horizon. But this is a fake post anyway, so the above is irrelevant. — Garth

#56 Not 1st on 05.17.12 at 11:47 pm

I am NOT amused

#57 Trailer Park Boys on 05.17.12 at 11:55 pm

#50 Smoking Man on 05.17.12 at 11:07 pm

I’m getting an enema tomorrow for my birthday. It’s my gift to myself, you only turn sixty once.

I think a lot of buyers in Victoria feel like they’ve had one recently.
=====================================

So..what are you gonna do on your 69th Birthday?

Never mind……(.just make sure you have a 9-11 chiropractor on stand by).

#58 vatoDETH on 05.17.12 at 11:57 pm

listings are up, sales are down, but don’t expect prices to go down… lol!

of course, if it was the other way around, you know they’d milk you for everything you’re worth… even when the market’s not in their favour, they still try to slither their way

#59 VicBC on 05.17.12 at 11:57 pm

#44 Karie

What ever happened to just buying a house to live and raise a family in?

Do you really make more money buying and selling multiple homes rather then buying one home that suits your long term needs? I have friends who have done the multiple home thing and all told I really don’t think they have done better then just buying and staying put. Even if you did make more by flipping in the end you are destine to lose because it’s very hard to walk away when the market turns.

#60 whynot on 05.18.12 at 12:00 am

Promise her anything, but give her Greed

http://www.youtube.com/watch?v=PO35CxpRmow

#61 Immigrant on 05.18.12 at 12:05 am

@ #17 WPG_Savant_Syndrome on 05.17.12 at 9:20 pm

“Garth please don’t turn all liberal on us.

For most the issue is immigration NOT racism. People would be just as pissed off if there were clusters of German, Irish, Polish people coming to the country in droves… ”

What issue do you have with immigration? Aren’t you an offspring of an immigrant? Are you trying to keep Canada for yourself?

#62 Chris K on 05.18.12 at 12:06 am

The new (more like “re”) listing in Kits is a bit fishy – same pics and same writeup. Looks like the practice from Victoria is making its way east. Where realtors are selling to realtors in attempt to push up the price. Those in the Big Smoke, warning to keep your eyes peeled as this will be coming to a neighbourhood near you soon!

#63 Rob on 05.18.12 at 12:06 am

Realtors rarely set the selling prices…the Sellers do. It’s not in a Realtor’s interest to price a property too high as it will just sit there, unsold. That said, try to convince a Seller their property is worth less than they think. If you think that was hard, then try convincing a Seller that their property is worth LESS than they paid for it years ago….almost impossible for a Seller to accept!

#64 Tony on 05.18.12 at 12:07 am

Re: #54 ANONYMOUS on 05.17.12 at 11:29 pm

That doesn’t matter because all the major cities will tank in price.

#65 Mr Buyer on 05.18.12 at 12:09 am

#16 Form Man on 05.17.12 at 9:19 pm
excellent post Garth !

there are a multitude of reasons why the housing market in Canada has developed into such a bubble, but continued rock bottom interest rates surely must be significant………
……………………………………………………………….
The interest rates were primary in relevance along with policy and regulatory changes brought to us by the Conservative/Reform Party. As the closing acts unfold interest rates are and will continue to become less and less relevant.

#66 Chris on 05.18.12 at 12:13 am

Live in surrey BC. Double basement suites are common here, just talked to a guy working at the gas station, he bought a new $800000 house in guildford ( white trash/ India ville) has 3 separate basement suites and rakes in $2200 a month from that. Theres something like 20000 illegal suites in surrey alone, soon people will rent out thier closets and sheds to pay their McMansion wannabe mortgages. What a joke

#67 Blue Monster Lover of Meats and Vegetables on 05.18.12 at 12:14 am

#39 John G. Young on 05.17.12 at 10:22 pm

“It shows the absolute greed and insanity of this free-based capitalism…”

Did he mean “freebase capitalism”? I’d say that captures it perfectly.

——-
Yeah, I’ve had just about enough of these freedoms in Canada. Time to rule with an iron fist. Full government control is required for our own good.

But before that happens I plan on selling my used 2005 Ford Escape for $100k asking price, those poor buyers won’t know what hit em’ and they’re powerless to stop me and my greed!

Maybe I’ll sell my bicycle too for $25k.

oooohhhhhhahahahahaa!

#68 Christopher Lackey on 05.18.12 at 12:15 am

Where does it end? My parents stayed put and raised us in Scarborough where prices stayed flat in the 300k range for over 50 years. My dad told me today a house on his street sold for 708k. No disrespect to him but there was nothing appealing about the area even at 300k. Here in Kitchener, 109 km, which 10 years ago was all firm sub 275k territory, everybody wants 400k now. No disrespect to my fellow residents but this is not an appealing area to live in at any price. Yes I want to move but where in my country remains affordable and not in the complete middle of nowhere? Hoping for the onset of Garth’s scenario soon

#69 Christopher Lackey on 05.18.12 at 12:16 am

#55 – fifteen not fifty. And sorry. My point was real estate doubled in the rest of the city while undesirable Scarborough prices stagnated, and yet today the place is absolutely crawling with greater fools

#70 Mr Buyer on 05.18.12 at 12:18 am

#54 ANONYMOUS on 05.17.12 at 11:29 pm
Canadian home prices are only about half of what they will be in a few years time, they are BARGAINS compared to most of Europe, and anyone who doesn’t understand this fact simply has not lived and traveled to Europe enough to wake up and smell the putrid truth!
………………………………………………………………..
Unless Europeans are making a huge amount of money more than Canadians, then those prices are 2 times over valued relative to the degree Canada’s are over valued and it is hard to even get to sleep with the putrid stench of the toasted carcasses of Canadian home owners paying their credit card minimums at the teller and stopping at the ATM to draw the cash back out of the credit card to get milk and bread. While selling and buying up and repeating the cycle has worked out for many they too are hitting walls in the expansion of their credit along with personal real estate bubbles as the degree of leverage is expanding more rapidly than their ability to make the monthly.

#71 Nostradamus Le Mad Vlad on 05.18.12 at 12:28 am


Greed, Inc. would have been a better headline. “It would be absurd if not hilarious.” — Apt definition.

“Does it seem a little absurd to you that a shuttle from Beijing would fill with lusty rich Chinese determined to target a cow pasture, 45 minutes north of Toronto, where a mess of suburban houses have yet to be built?” — Does this fit your description of a shuttle?
*
EZone Banks History rhymes and repeats; More than half of Brits. want to leave the EU; A Castanet writer opines there is no global economic recovery; Life Before Credit Cards; Out To Lunch; Wacly Walmart; Losing Millions; China’s Slowdown means trouble for the US; Stinking Disaster; ECB What are the chances of an int’l banking crisis? (Esp. if it’s a manufactured one); Brain Drain in Italy; The Fourth Reich taking shape? Spain Increases VAT; Euro debt mind-boggling; 53:32 clip Order from Chaos, the NWO’s mantra. There is plenty of chaos, turmoil etc. and Double Dose 2008 all over again? Passing it On Wills, etc.; Twenty Pounds a Month Increase in mtge. rates could leave 100K families homeless.

Allowances Govts. should be placed on tight allowances, not people; Tungsten Infographic; 25K Job Cuts at HP; Will the world explode if Greece bids adieu to the EU? Rough Landing for China; Sunday, 17 June 2012 Wally (from Dilbert) and The Undertaker get married (NOT!); Brazil — Here we come! Stating the Obvious Tim Geithner; BRIC stocks wander into bear market; Trap Door opens under US Treasury yields; The Closer Links and stuff; Recession How many more before it’s called a depression?
*
Ron Paul Looks as if he was not all he claimed to be; Misssing Nukes All over; Tied for First Most unpopular countries in the world; 5:12 clip Something’s up with California fault lines, and Big Bang Popcorn; Swedish Super Car Nice, but prefer a Hummer; Skyscrapers: TNG; The Sky at Night Interesting pix; Bob Geldof (The Boomtown Rats) on how Africa has improved. Unfortunately, the war pigs from the west have moved in, so enjoy it while you can; Bizarre Brits. Not for the squeamish; Cameron vs. Holande First shadow boxing match.

#72 Frank the skank on 05.18.12 at 12:31 am

What’s the problem with seg funds?

#73 martin9999 on 05.18.12 at 12:32 am

BIGRIDER

http://www.youtube.com/watch?v=hir7limRXUk&feature=related

this was the crapiest thing ever

#74 Freedom first on 05.18.12 at 12:34 am

Greed etc. …..nice title:)

Garth, I would never be so bold as to put words in your mouth, but, I would like to respectfully use a few of my own words for the “etc” with your permission?

Furst:) of all, I just want to clarify that I do not see any particular age group, race, nationality……to be exempt from these unfruitful character traits existent, with one, or more, or, all of them, in the “Financially Incompetent”.

Now, I would follow “Greed”, with: Fear, Ignorance, Stupidity, Close-Minded, Entitled, Envy, RE Lust, Ego, Show-Off, Immaturity…….Please, my fellow Blog dogs, Garth, anyone, if I have missed any, feel free to add to the list.

#75 martin9999 on 05.18.12 at 12:36 am

SMOKING MEN

Do you give out personal consulence one on one?!

Can pay you up to 80$ an hour

#76 Wes coast on 05.18.12 at 12:39 am

I think all the discussion around that picture is for the most part healthy. I think what may get us in a knot (regardless of our own origins) is that there is just a lack of diversity in that photo. It’s not that they are of Asian origins- it’s just that we are in Canada – and when you see a photo of a public event in Canada its shocking to see a lack of diversity in the photo.

Yesterday’s posts had a fella of Asian decent who was upset by that photo as he cited a cultural trait within the Asian culture to ‘follow the heard; is it possible these prequalification screenings actually used Asian names as part of the process in order to exploit this cultural trait and bid up prices?

We’ll never know but if you believe what this blog is telling you there is no reason to get a hate on for buyers (regardless of origin) as they are going to suffer great financial loss. Anger should be reserved for the white dude in the photo (not because of his origins) but because we know he’s fleecing those buyers.

#77 MC2 on 05.18.12 at 12:55 am

I think Mr. Rennie pays Tsur Sommerville’s salary at UBC. What else explains the BS that comes out of his mouth?

#78 Brooks on 05.18.12 at 1:15 am

Garth, Ozzie Jurock is putting together a real estate Alaska cruise. You should go and ask him a few tough questions during his seminars.

#79 Aussie Roy on 05.18.12 at 1:55 am

ANONYMOUS on 05.17.12 at 11:29 pm
I just read this comment from a lady. I’m not sure if she’s correct or not :

(” Markham and other area are sadly now considered commuting distance to Toronto, making them very attractive for newcomers who don’t want to live in the city but still need to work there.

Canada is still a heck of a lot cheaper than most European countries and most other 1st world nations. Canadian home prices are only about half of what they will be in a few years time, they are BARGAINS compared to most of Europe, and anyone who doesn’t understand this fact simply has not lived and traveled to Europe enough to wake up and smell the putrid truth! ” )

Wow !
…………………………………………………………………………..

LOL, doesn’t she have the internet.

Of course some of these countries have bubbles to.

Take a look at Germany prices the power house of the EU.

http://www.economist.com/blogs/freeexchange/2010/10/global_house_prices

#80 truth hammer on 05.18.12 at 1:59 am

Hey Guys remember…the definition of a suckers market is when the majority of suckers get pulled into the many……not just a few. Big bear markets at the exact moment when everyone is at their most confident and lines up for IPO’s and …….overpriced real estate etc. It’s the nature of the beast to screw as many people as possible and the beast won’t flip until everyone agree’s that there’s nothing ahead by blue sky.

In the case of ‘Skits-a-Lano…..I know the area well. It’s ‘Skits’ for a reason because of it’s dual personality. What you have is an area which was boonyville 50 years ago when the grandparents bought houses on dirt roads with no service. The current lot of enterpeneurs are the children who have been living in the parents and grandparents basements waiting for the old folks to die.

Well, when they do emerge as middle age ‘homeowners ‘ after the death of mommy or granny they transform into successful entrepeneurs who’ll demand you believe that they have come by the money with the sweat of their own brow. As a one time credit manager of course I knew they were all lying….so I enjoyed kicking them in the nutz while being uber appreciative of their new found business acumen.

Now our newly minted ‘millionaires’ live in urbane splendour , basking on the wages they rake in from city jobs as road workers….and the few who got an education work for the people as well……a huge number of gresy civil servants haunt Skits as incumbents. The problem all these people have is that they can’t afford to sell. Their whole personal relationship with God resides in the space that they live in ‘Kits’ …..selling would mean joining the godless hoardes in some suburban sewer like Surrey( choke) or worse Coquitlam ( shudder).

These are the people who have leveraged themselves up the ying yangs with second tier credit…….Helocs and credit card debt…..because they’re rich…but have no money after taxes……these are the same Liberal do do’s that vote for anti business and free everything for the lazty so that taxes continue to spiral up. These are the same people who bitch that costs have gone up and that they must strike for more money because costs have gone because we’re paying these slack jawed neanderthals too much in the first place.

Don’t get me started on Dunbar………the hillbilly with a gold tooth is still eyeballing yer behind. The basement dwellers are watching ‘Deliverance’ and waiting for you.

#81 truth hammer on 05.18.12 at 2:12 am

‘scuse me for second posting…but doesn’t this guy remind you Sacha Cohens new movie…The Dictator? This Jihadi goofball loved Toronto…..found it a haven….loved Timmy’s……nice Canadian people……gets job…impregnates girlfriend….the peaceful enviornment ..but then announces he wants to destroy it anyway….Watch the trailer for ‘The Dictator’…the similarities are outrageously funny.

http://news.nationalpost.com/2012/05/17/omar-shafik-hammami-the-story-of-an-america-jihadi/

#82 Lost the taste for RE on 05.18.12 at 2:25 am

Reply to #54 Anonymous: That was no lady, that was a realtor.

I’ve heard that one before — many times — in Ireland, England, Spain, etc. D’you know how many houses they’re bulldozing in Ireland these days?

The housing ponzi game has been played (and played out) all over the world in the last 12 years. It’s interesting how the lines used to hook the suckers are so similar. This one is a good example — make the skeptic feel naive and unexperienced.

Even more shocking is how many millions of people have fallen for it. Are so few capable of independent thought?

God help us.

#83 TRT on 05.18.12 at 2:41 am

A very diverse Canada is coming and will benefit most if done right. The current issue with RE/Immigration is most are moving to primarily 2 cities, creating enclaves where allegiance is to the source country. This concentration inflates RE.

Most posters are not racist (hope not) and are probably frustrated with the above concentration.

In other news, visible minority babies are the majority for the first time in USA history. In 40 years, there will be no dominant race in Canada or the US. Accept that. However, it could be achieved in a better way.

http://www.telegraph.co.uk/news/worldnews/northamerica/usa/9271573/Non-white-births-outnumber-white-births-for-the-first-time-in-US.html

#84 Buy? Curious? on 05.18.12 at 2:43 am

Garth,

You know the housing apocalypse is upon us (I hope everyone is sitting down for this).

Celine. Dion. is. selling. her. chateau. in. Quebec! For $29.5 million!

http://www.dailymail.co.uk/tvshowbiz/article-2146152/Celine-Dion-puts-private-island-Quebec-chateau-sale-whopping-29-5-million.html

If that isn’t a flaming sign to get financially liquid, I don’t know what is!

#85 NFN_NLN on 05.18.12 at 3:23 am

#54 ANONYMOUS on 05.17.12 at 11:29 pm

I just read this comment from a lady. I’m not sure if she’s correct or not :

Canada is still a heck of a lot cheaper than most European countries and most other 1st world nations. Canadian home prices are only about half of what they will be in a few years time, they are BARGAINS compared to most of Europe,

It’s all true. Check out Spain’s RE prices:

http://www.dailymail.co.uk/news/article-2102074/Spain-haunted-ghost-towns-built-boom-years-unemployment-tops-5million.html?ito=feeds-newsxml

#86 Aussie Roy on 05.18.12 at 4:17 am

Aussie Headlines

Last year the RE industry told us, “Buy Now” we have hit the bottom.

So was it?, how did those who took this sage advice do?.

Well, one year on, judge for yourself.

Year to April 2012

Sydney -2.6%
Melbourne-7.0%
Brisbane-6.4%
Adelaide-4.2%
Perth-2.8%
Darwin-1.1%
Canberra-0.7%
Hobart-8.5%

National-4.5%

http://theage.domain.com.au/real-estate-news/blogs/domain-investor-centre-blog/a-buyers-market-cometh-20120518-1yuyy.html

The slow melt continues.

#87 DondWest on 05.18.12 at 5:14 am

Garth, forget real estate for just today.

The question of the hour is: should I short facebook?

#88 JW on 05.18.12 at 5:19 am

to some of #52’s point…

Found my father’s old high school annual, from about 1960 the other day. He grew up on the west side of Vancouver. Maybe 5 asian graduates of about 300 kids. Today, english as a second language foreign students and asian kids constitute about 70% of the school. I have several asian friends that were born in Canada, but the fact remains the neighborhoods of wealthy Vancouver has dramatically changed. It has disjointed a community when an older bungalow for example is torn down and a massive house with two dragon heads front the driveway to protect it’s occupants. The kids or extended family usually reside in the house, as the owner likely commutes and keeps his business in HKG or China. A Chinese banker friend of mine also says Richmond is basically a suburb of Hong Kong. They like the “Rich-man” association and Chinese malls and shops, where speaking english is optional. Why wouldn’t you sell your 2000 sqf flat in Hong Kong for 2 million and buy a nice spacious house in Vancouver? He also said that the Chinese have realized that owning and running a business is much easier and lucrative in China or Hong Kong, therefore they prefer to keep their business but have the rest of the family live in Vancouver for a better life.

Did it not start with the concern of the Hong Kong handover in 1999? In the early 90’s when the take back was announced, many hedged their bet with the purchase of real estate in Canada, specifically Vancouver. The mainland chinese have been purchasing in greater numbers for the past 10 years. Hence the dramatic real estate price rise over the last decade. I have a few developer friends that do business on the west side. 90% of the reno house purchases are from Asian buyers. They now keep the asian buyers in mind when building a house and use feng shui consultants. Interesting times….

#89 House on 05.18.12 at 5:27 am

So have you dropped the interest rates will rise line? I guess people will have to prove they are smarter than a Finance Minister and a Central Banker. And there is no problem with the economy, car sales are back. But why is it that 20 years ago I don’t remember being offered 0% for 48 to 84 months financing and $8250 in Cash Incentives. Is this the new normal?

#90 Nonno Nicola on 05.18.12 at 5:46 am

To Bigga Rider from yesterdaya’s blog and da guya who posta da questione of how Nonno Nicola even knowa howa to usa da interneta.

To day guya who aska da questione about da interneta, Nonno saya dat his nipoto Tonino typa the wordsa justa lika Nonno dictata dem to him. Nonno no even knowa how to open da computer! Now to Bigga Rider. Firsta alla, you saya I only go to a grada two but I no dat stupido. Nonno went to a grada 5, I already tella youa dat. Secondo, Nonno no claima to hava all da answera to da problemi economico. Nonno justa tinka dat the soluzione is somewhere in da middle, lika da Buddhisti saya. You no can go to da extrema. No paeso ever implementa da Austriano school of economia for a longa perioda of tima and hava da resulta dat theya claima gonna happen, not even da paeso where da school originata, la Austria!! Sorry to disappointa youa wid no real answero Bigga Rider. I no feel bada becausa a lotta guya who have da degreesa in economia, they no hava da answera eithera! Two booka by da same authora I recommenda are da Market Wizards and da New Market Wizards by Jack Schwager. Dis guya he interviewa da top traders in da worlda and dey saya alota good tings about trading. You probably hava dem already because you a smarta young fella but I try anywaya. Tonino, he a reada dese booka to me. I thoughta dese booka woulda hava an interviewa wid da bearded mangia caka who writa dis bloga but they no hava. Hava a gooda daya and longa weekenda Bigga Rider.

#91 Kip on 05.18.12 at 6:04 am

“Now, move on.”

Many people are in fact moving on as wobbly stock markets tank. The May and June numbers for real estate will be interesting as we see how much of that money flows into GTA housing. I suspect it will be plenty.

#92 Deb on 05.18.12 at 6:09 am

“We’re at an interesting intersection of human emotion and perception”

——————————————————————

Indeed. We are motivated primarily by fear and greed, and have been for tens of thousands of years. Nothing new here, for that’s how we’re hard-wired. The change in sentiment has started in certain parts of the country and it is spreading. Group perception has begun to turn. Depending on your personal financial situation, the dark clouds on the horizon could spell significant pain, or for those who choose to remain patient, an opportunity that will be very rewarding.

#93 Deliberate Dumbing Down on 05.18.12 at 7:15 am

A university professor thinks that the insanity of Canada’s real estate market is fueled by “free-based capitalism”?

How amusing.

Ever had a typo, Mother Teresa? — Garth

#94 Regan on 05.18.12 at 7:16 am

Thanks to whoever posted the link to Vancouver Price Drop – what a glimpse into insanity.

#95 Kip on 05.18.12 at 7:22 am

DELETED

#96 John on 05.18.12 at 7:25 am

Yes, this blog is a financial blog. No, the Chinese buyers are not making an exclusively financial decision buying near family and friends. They are making a decision to join a community, and all that entails. It’s a huge part of this.

Your comment exposes quite a crack in your foundation. On one hand it’s a financial blog which can stretch and rise to such lofty moral issues as greed, fear, anger and distrust ( oddly trying to keep this inside a housing box). On the other hand, there is either blindness or denial regarding essential human dynamics: Canadian communities.

If that’s the case, judgment is effected. What else isn’t being considered if a major issue such as culture, communication and assimilation aren’t weighed in sufficiently?

Dark forces can grow if the truth isn’t at least approached. The different cultures of Canada don’t need a patronizing “holier than thou” protection. They actually ARE valuable communities of immense value.

So you can honour this and say…”look, people acting on their values and community, not the world ponzi scheme. Bravo! Now that’s leadership”. But no, instead…a myopic and false representation ( or understanding) of a MASSIVE culture in Canada. Patronizing them. They get that by the way.

Having said all that, assimilation IS an issue, and if the water level of “good times” drops, people need to work together. Such an instance could be GREAT for Canada if different cultures in the pot decided to melt a bit in problem times. Racism stops that. And not acknowledging real communities fosters that racism.

Hell, if the prices dropped 50% in Unionville it still wouldn’t even TOUCH the vibe of what was driving those people. Imagine how insulting your comment about “falling prices” is in that context. It’s really uninformed and reflects a possible view that Chinese people are “invisible”. I mean…wow. Think about it. Remember Flaherty’s “un-Canadian” comments? How cynical did he appear?

You turned up the heat in a messy way by ignoring the motives of this community and putting their actions at that “plan viewing” into a “financial blog”.

That was a mistake.

Hardly. You don’t need to spend $1 million on an unbuilt, speculative house to be a part of a community. Get over yourself. — Garth

#97 Bottoms_Up on 05.18.12 at 7:50 am

#45 Karie on 05.17.12 at 10:59 pm
————————————–
You are very fortunate that you’ve benefited from rising real estate prices; I have friends that were able to eliminate $100,000 student debt just because they ‘owned’ houses…can you imagine starting out today, trying to buy your starter home at $350,000, or trying to get into the market with large student debt?

What are the newbies of today going to do?

#98 steev on 05.18.12 at 7:55 am

#45 Karie on 05.17.12 at 10:59 pm

Karie,

Stop the act, just come out and say you don’t believe Garth at all. You’re bull on RE. Just look at your posts.

Day 1: You trash renters, but think being diversified is just great.

Day 2: You think the greater fools buying Unionville are making the right choice, and it’ll be great for the economy.

Day 3: You claim to have made money climbing the property ladder. Tell me, if I own silver and it goes up, is it a good time to sell my silver and buy gold? Have I made any money off that transaction?

If you’re flipping properties for profit, then good for you…but if you’re a flipper I’m guessing your portfolio isn’t as diverse as you were humming and hawing about on your post two days ago.

Just come out and say it. You’re a bull in bear’s clothing.

#99 bigrider on 05.18.12 at 8:09 am

An update on the RE101-Gottohumpahoma virus.

A medical tent will be set-up next to the site in upper unionville to inject an experimental vaccine which may cure , or at least slow, the progression of the virus.

Mandarin speaking nurses and doctors will be made available.

Nonno, I have not read market Market Wizards but have heard of it elsewhere and recommended to me by another. I actually may go pick it up this weekend.

As for implementation of Austrian ,I said nothing of the sort, I simply said that Keynesian precepts were failing to correct problems, thats all. You did say grade 5 by the way,my bad.

And by the way nonno, something tells me that we know each other, or at least, you know me.

you grada fiva maka you a very smarta pantalone nonnino.

#100 Tri-State Pat on 05.18.12 at 8:13 am

http://www.thefiscaltimes.com/Articles/2012/01/04/The-New-American-Dream-Rent-Dont-Buy.aspx#page1

Rent vs. buy in the States. Home ownership from 69% to 62%. Maybe soon playing at a theatre near you…

#101 Diana on 05.18.12 at 8:13 am

Racism:
hatred or intolerance of another race or other races.

Xenophobia:
hatred or fear of foreigners or strangers or of their politics or culture

I don’t really see a difference between the two dictionary definitions Wpg Savant Syndrome. If I did have to differentiate, the xenophobia looks worse because not only is skin colour a problem, but so’s politics and culture. Of course, that was made pretty clear with the off the cuff libel on liberals. Did it make you feel better?

What I do see in that picture that caused all the kerfuffle is a very carefully targetted ‘lottery’ that doesn’t have a lot of random in it’s make up.

#102 TurnerNation on 05.18.12 at 8:36 am

Over on the Junior Board…a condo closing shocker.

I’ve heard, savvy buyers get their lawyer to cap closing costs (and BS builder feed) on the contract. Otherwise, this:

http://forums.redflagdeals.com/condo-closing-fee-cost-question-always-like-1177691/

“””Condo closing fee cost question (is it always like?!?!?!)

We bought a pre-construction condo back in 2009.
Finally moved in a two months ago.
Our final close is next week.
Closing cost is $35,000

Does this sounds about right? We bought for about 310k and it’s in Thornhill.

Looking to hear from people who’ve gone through this. As a first time home buyer, I had a mini heart attack.”””

#103 Nemesis on 05.18.12 at 8:46 am

“Harder to spot, though, aren’t they?” — Hon. GT

In my experience, OldPol… they’re rather easier to spot… For example…

The Irish: http://tinyurl.com/clwaknw

The Dutch: http://tinyurl.com/3f3596q

#104 Toon Town Boomer on 05.18.12 at 8:51 am

The citizens of Canada really need to remind themselves that they have power in numbers. If they all decide to hold off buying realestate there is no market. Even boycott realtors like the one mentioned here today, but do something for heaven sakes. Get Mad!
If we don’t wake up soon we will all be working 24/7 to buy shacks and all those shrinking food boxes we pay more for now. Aren’t you tired of being ripped off? COME ON CANADIANS UNITED WE STAND

#105 John saccy on 05.18.12 at 9:03 am

To All risk takers…

DO NOT SHORT FACEBOOK……… atleast for a week.

The premium on options will be very very high. Watch the sucker go past $80-$100 in a very short period and then time the Puts for a strike price of $70-$75.

#106 Ferrari321 on 05.18.12 at 9:06 am

#89 – no idea wtf you are saying … learning to read / write is a good idea

#107 Junius on 05.18.12 at 9:33 am

#42 Inglorious Investor,

I have seen that video. Again, you mischaracterize Keen.

There are 2 separate issues and you got both wrong. The first is the debt write down where he says that debts that cannot be paid off and in many cases should not have been made should be written down. He does not advocate an inflationary solution as you suggest. You are just making this up.

The second part where you are completely off base are his long term solutions. He is clear in many interviews that the banks need to be down-sized, ring fenced from speculative investing and properly regulated.

#108 Ed from TO on 05.18.12 at 9:41 am

“It’s the same house,” says Jason. “We know because we saw it.” Jason and his wife are university professors at (sort of) nearby UBC, and they’re not impressed. “A roughly 250K mark-up in the past 3 months?…. It shows the absolute greed and insanity of this free-based capitalism…… I thought you might find this amusing…..”

Greed?
Insanity?
If you can find a greater fool more power to you.

#109 Junius on 05.18.12 at 9:43 am

#54 Anonymous,

Clearly you are a realtor troll. Having been to 4 countries in Europe over the past 3 months I can tell you that prices are not only cheaper there but going down further.

Even choice locations like the South of France are very affordable compared to Vancouver and Toronto. When you compare he prices to traditional differences you would be crazy to consider investing here. Get a grip.

#110 Q on 05.18.12 at 9:59 am

think I’ll wait about 10 months until 90% of the realtors homes are in foreclosure….then show them how to perform an extreme lowball bid…..should be great fun.

#111 greed on 05.18.12 at 10:14 am

Frank the Shank
“What is wrong with segregated funds?”

Well Frank the Shank seg funds are expensive. Meaning the insurance company has to pay someone to manage them just like a mutual fund and then they have to find a way of covering the cost of the insurance component of the fund. So lets say the stocks in your fund return an average of 7% by the time the insurance company is done with the above costs you get about 1 to 2% return on your money at best. What is the point give it to the guy with the orange shorts. The only guy making money on your funds invested the guy selling you them.
I know I worked for London Life many years ago.
Cheers,

#112 Karie on 05.18.12 at 10:15 am

@59 Vic BC – Our first house was a 100 year old home with 2 bedrooms, 1 bath. I just wanted to get into the housing market and that’s what we could afford. I then moved up to a place I could have stayed in but then we moved across the country and we bought our third house. We bought a house to get equity because it was similar to paying rent.

@97 Bottoms Up – I think housing can be affordable if you’re willing to commute from a suburb or live in the city in an older home in a not so trendy neighbourhood but up and coming and probably won’t have the modern upgrades people expect like granite, etc. There are many options but depends on your expectations and motivation.

@98 Steev – I have been reading Garth’s stuff for a long time and he has not been pro real estate since the ’80’s when he was heavily invested and I’m just trying to understand why and piece together his success story. I can maybe understand why against real estate right this minute but why not for so many years? I think real estate over the long term is a great investment that stabilizes payments and is a big part of the solution to gaining financial freedom.

I have invested some money in mutual funds and stocks throughout the years but the returns have been minimal.

I come on here questioning renters because I want to find out their formula for financial freedom and what it is that they feel they’re doing right but what it seems like is that people think they are just priced out of the market so they’re renting. I enjoy reading about what Garth or anyone else did right through the years and what he/they regret and why Garth became so anti-real estate.

#113 Dorf on 05.18.12 at 10:18 am

I have had coffee numerous times with my mom, regurgitating everything I read on this blog, I told her to sell her upscale country home before prices crash and rent a nice condo, because she wanted to move to another town. She is three years into retirement on a company pension. Her original place was paid for. So, taking heed of all my good advice, she sold, then went out and bought a more expensive place that she can’t afford, now she’s retired with a mortgage and money is very tight. And I thought I was the pot smoker in the family.

#114 Q on 05.18.12 at 10:19 am

methinks the price of BC bud is too low out there….causing mass consumption, resulting in total stupidity. It will look good on the idiot that paid $1.55M when he’s forced to resell next year for that clapboard commuter is actually worth….about 35% of what he paid.

#115 Nonno Nicola on 05.18.12 at 10:24 am

#99 Bigga Rider

There area two booka by the same authore Jack Schwager. Da firsta one wasa Market Wizards and da seconda one was a The New Market Wizards. Tonino, my bravo nipoto (he is in a Grada 6) reada botha dem to me. Youa righta, you never saida dat the Austriano school of economia was the soluzione totale. Mya badda, I no wanna getta in trouble wid Nonna Nicola, she outa at da gyma righta now. I marry a younger femmina and ina casa you a wondering, Nonno no needa da viagra… Sometimes I tinka we know each other too Bigga Rider. Anywaya, I hopa you and youra famiglia hava a gooda long weekenda. Ciao.

#116 Canadian Watchdog on 05.18.12 at 10:27 am

GTA one bedroom units now have 65% market share of new condo openings. http://i50.tinypic.com/14v78ft.jpg

What bubble?

#117 Inglorious Investor on 05.18.12 at 10:39 am

#107 Junius on 05.18.12 at 9:33 am

“[…] the banks need to be down-sized, ring fenced from speculative investing and properly regulated.”

Whether that’s a Keen quote or not, I agree with that.

As for your other points, either: you’re not paying attention; or you have a (selective) hearing problem; or you are just blinded by infatuation.

He may say bad debts should be written down, but it’s clear that’s not his proposal, at least as far as consumer debt is concerned. He literally wants governments to give everyone money––not tax cuts or rebates, but literally cash.

That point was plainly made. Again, not sure how you missed that. But maybe this will help: Read the headline here: http://news.bbc.co.uk/2/hi/programmes/hardtalk/9641873.stm.

FYI: it reads “Keen: Government should print money to pay off our debts”

But if you need to hear what Keen actually says (again): watch the embedded video clip from 1:45 to about 2:40. If you still don’t understand, I could always prepare a transcript for you, but I wonder if even that would help.

So, once we the people got the money, those with debts would then be required to use their free cash to pay off their debts. (Aside from the fact that this idea is nuts, how do you actually enforce that? Keen himself seems to have no idea.) Those without debt could use the cash to––oh I don’t know––buy subscriptions on his web site maybe. I’m sure he’d love that.

Of course he is not going to admit that his solution is inflationary, but if you actually understood what inflation is you’d know that his solution is PURE inflation. And worst of all, it would solve nothing and destroy a great deal.

Now, Keen IS a smart guy. But you can be smart AND insane at the same time. But honestly, knowing what a self-important, cocky, attention whore Keen is, I suspect his ludicrous idea was proffered mostly to get himself some media exposure. That’s the one part of his plan that would work.

For your own good, I suggest you extract yourself from Mr. Keen’s lower digestive tract, and maybe also learn a thing or two about finance and economics.

#118 truth hammer on 05.18.12 at 10:53 am

You wonder why the government has hyperinflated the cost structure of everything? It is to raise tax revenue to pay for the skyrocketing expense of paying for all the richly entitled parasites entrenched in the Canadian system from legacy decades of Liberal pandering to the whiny socialists. Generations of Canadians have been told that the taxpayer is an endless juicebox of free money and what they don’t give is goind to come from a magic hole in the back yard..

http://news.nationalpost.com/2012/05/18/emergency-quebec-legislation-could-see-students-fined-up-to-35000/

When you have to pay 100% of your income to taxation in order to support free education, perks , pensions and give aways to special interest groups don’t come crying to me about not being able to afford your mortgage payment and a pizza on Friday night.

Supporting these wacko’s and their lifestyle expectations ( which are always much more comfortable than yours) is guaranteeing that prices will be pushed higher so that more cash can flow to the undeserving wankers riding the back of the workers. If anyone doesn’t see the tie in then I would suggest some basic Grade 10 economics classes. It’s really simple ….the more thats pissed away on freebies,,,the more the government has to tax and borrow…….it does not have a magic hole to ream my friends…..they only have yours.

This will be your last post on this subject. — Garth

#119 Steven Rowlandson on 05.18.12 at 10:54 am

With such idiotic real estate prices being asked for and paid it has me doubting the sanity of Canadians.
When it come to real estate canadians with a house to sell have nothing but dollar signs in their eyes and they think they are all going to get rich screwing over some young canadian who landed his first job right after highschool or college.
It is time for a reality check and for young canadians to tell realtors and vendors to shove their heads and their house prices up their backsides and fight for air.
Younge canadians should be mad as hell over what they are being asked to pay.

#120 Balmuto on 05.18.12 at 10:59 am

Oh yeah, and it takes (according to RBC) 72% of pre-tax income for the average family to own a home, which is more money than they actually have. – Garth

So who has been buying homes in Vancouver at these prices, if they are way beyond the reach of the average Vancouver family? If it’s not foreign investors, then who? Are you going to pin the run-up in prices solely on domestic speculators, flippers? I think the market would have collapsed a long time ago if that was all that was sustaining it.

Debt. — Garth

#121 unbalanced on 05.18.12 at 11:05 am

I was wondering and hoping Garth if you could tell me why you dislike seggrated funds. I’m not testing you. Just wondering because my wife has these and to be honest not to happy with them. How does one get out of these without getting fleeced from the DSC. Thanks in advance. If you don’t respond I understand. Keep up the great work!

The DSC is the least of your worries. — Garth

#122 Inglorious Investor on 05.18.12 at 11:09 am

Anyone tracking the Facebook circus? It’s like the Canadian housing market encapsulated in one stock. Fascinating.

#123 Frank the skank on 05.18.12 at 11:27 am

#111 greed

Thanks for the reply, I appreciate your time. Part of my retirement plan is to invest in Seg funds for about 25 years. The Seg fund I’ve purchased provides a guaranteed 5% return on my investiment. If returns are higher, that % value increases. I’ve read up on Seg funds and am looking for the downside. I was told that the admin fees are high, but I really don’t care as long as I am guaranteed 5%. I realize that someone else is also making money, I’m fine with that as long as I am guaranteed 5%. Is there a better way to invest that would guarantee that type of return in the long run? Please don’t tell me to invest in real estate…lol!!!

You just got had. — Garth

#124 greed on 05.18.12 at 11:27 am

#118 truth hammer

Can’t believe that this post is allowed – rude!

It is his epitaph. — Garth

#125 disciple on 05.18.12 at 11:29 am

#92 Deb…”that’s how we’re hard-wired”. No, that’s how we’re SOFT-wired. It is only your cultural programming, not your human soul. Looks like my work here isn’t done.

Blacksheep… Stefan Molyneux is confirmed opposition. Proof: He is closely associated with Max Keiser and Alex Jones, both confirmed actor roles. He also took over the reins for Peter Schiff at certain times, and I’ve already told you a couple of times who Peter Schiff is.

#126 Arshes on 05.18.12 at 11:38 am

#112 Karie on 05.18.12 at 10:15 am
@98 Steev – I have been reading Garth’s stuff for a long time and he has not been pro real estate since the ’80′s when he was heavily invested and I’m just trying to understand why and piece together his success story. I can maybe understand why against real estate right this minute but why not for so many years? I think real estate over the long term is a great investment that stabilizes payments and is a big part of the solution to gaining financial freedom.
———————————————————-
Financial Freedom?

My parents have a paid off home, they purchased in the late 70′s and paid it off approx. late early 90′s. But now my dad is 67 and still(was) working. Having a paid off home for almost 2 decades hasnt help my father retire. He thought a paid off home was the best thing someone could do, now he realizes he should have saved more. Somehting he didnt realize until he asked his advisor about retiring. My parents lived below thier means, no vacations every year or even every other year, cars paid with cash, dont eat out, diffenately frugal people. Yet he cant retire. He recently had heart surgery and suffered a stroke from a blood clot, now i worry about the cost of long term care and retirement funds running out. They have approx $300,000 and CPP and OAS. Yet may not have enough for the next 20 + years. Did thier paid off home equal a “success” story? If you have a paid off home yet, not enough saved for the future???? Why is that considered a “success”?

I dont rent now, i live with my parents right now, but i did before. Do i see myself ever owning a home, probably not. Why ? I think in the long run its the best way to secure my financial future, a house or retirement? Time off to help my parents or stuck at my office desk cause i have no savings and no money.

Every month my parents pay money into thier “free” home, had they saved more they probably could afford to live their as long as they want. But when my father finally gets out of the hospital i’m gonna beg them to sell and rent. They’ll be better for it. Money to travel, money to relax, money for now and the future. No burden of the home, and not enough for retirement.

I can guarentee your house wont be worth what it is today in a decade from now, or two decades from now.

I’ve seen the boomers and how they fill up the hospital beds when i go see my dad at the hosipital everyday. Its gonna get worse in the future more people will need funds for medical reasons, more people are gonna need assisted living, more people will need funds for thier retirement. Theres gonna be a point in this countries future where 20% of the population is going to be over 70 or older, the future for real estate isnt going to pretty.

#127 CP on 05.18.12 at 11:44 am

“Anyone who’s visited Markham or Unionville lately”

Ummm, you mean in the last 20 years? I grew up in Stouffville and the running line from the locals was that eventually the “Asian invasion” from Markham would hit Stouffville. Their words, not mine.

#128 SJ on 05.18.12 at 11:44 am

#45 Karie on 05.17.12 at 10:59 pm

Karie, the mortgage you took on each time must be bigger and bigger. You will feel invincible till the day of the crash. Then all you got is a house-under-water and a big mortage for rest of your life. Hope you like that house as you will be paying for it well into retirement! (provided you do not walk away)

#129 Canadian Watchdog on 05.18.12 at 11:50 am

Facebook launch snapshot http://i47.tinypic.com/4ilmh1.png

#130 DM in C on 05.18.12 at 11:50 am

#112 Karie

“I come on here questioning renters because I want to find out their formula for financial freedom and what it is that they feel they’re doing right but what it seems like is that people think they are just priced out of the market so they’re renting.”

My formula for financial freedom is easy — we rent a $500k house for $1850/month. We bank $1500 + resp in savings every month.

We’ve owned two houses back east, but moved to Calgary during 2006 the height of the boom — prices were ridiculous and in some places, still are. This city has more money than brains (another separate topic).

We thought about buying a place in our neighborhood a couple months ago for 3x income, but decided that we’d rather remain liquid and carefree, and keep making those contributions. Plus the moron realtor tried to force a bidding war on a house that was on the market for the past year. It’s still on the market. Reap what you sow.

We’re not priced out of the market — our priorities are living and not sacrificing for shelter. It’s not like we can’t afford it — I’m a VP at my company and we are doing very well. Hubby is at a great company too.

Obviously you’ve benefited from the long run up in prices. What is your plan for financial freedom given that the market is obviously on a long slow slide down and demographics won’t favor selling at high prices — who’s gonna buy, kids with $100k in student loans and $50k jobs?

#131 greed on 05.18.12 at 11:50 am

#123 Frank the Shank

Sorry buddy I have not been involved in that industry for awhile and did not know they were providing a 5% guarantee. Are there costs to exit or take money out?

If not carry on if you like 5%.

#132 Hoof-Hearted on 05.18.12 at 11:57 am

Here in Hamville central,aka Richmond, you can see the panic is on.

The inventory of houses “For Sale” less than a year old are increasing, indicating the old capital gains flip attempt.

I am just wondering if CRS is now going to add to the misery and start auditing these flippers demanding the proper paperwork. That’s one Gov’t initiative I’d support, as these flippers add to the misery and are effectively de -facto subsidized by the other taxpayers.

As I drive around, a lot of homes being built are near completion. My thoughts are, if the owners are paying attention, they must be in fear, given they likely bought the land at peak price and any equity they had shrinks daily as the market tanks.

#133 Van guy on 05.18.12 at 12:02 pm

All you HAM haters can now relax. That kits home does no interest Asian buyers. Not a HAM area, not an ideal HAM square footage, and lot is too small. So the fingers are pointing to who? Cacausian buyers. HAM have fled Vancouver.

#134 Islander on 05.18.12 at 12:05 pm

Garth, I’m sure you’ll have some colorful things to say about this:

http://www.cmhc-class-action.com/

#135 2centsCanadian on 05.18.12 at 12:10 pm

DM in C #130

You are right on the money. Your decisions were based on $ reality with emotions removed (emotion always cost us money). I wouldn’t always say renting is/was the best option, but I think if someone was thinking on buying a home in the last two or three years, choosing instead to rent will soon turn out to be a genious decision. You are in control of your own destiny, something millions in Canada can not say. And when the time is right … you can come out and buy when the time is right, at the bottom of a cycle.

#136 Inglorious Investor on 05.18.12 at 12:12 pm

#126 Arshes on 05.18.12 at 11:38 am

Good post. And poignant.

Your parent’s experience exemplifies the fact that a house is a consumed good as much as an asset (actually, it’s mostly the land that’s the real asset, but anyway…). As you point out, a mortgage-free home is not a cost-free home.

Real estate has proven to be a good store of value over the long run. And home ownership is as much a lifestyle choice as a financial one.

But, the boom and subsequent mania of the last 12 years or so have made RE overpriced by just about any metric. It’s a great time to sell, especially if you are retired and need the money.

I agree with you. If I was in your dad’s position, I would seriously consider selling and putting the cash toward improving my remaining years, not the walls that surround me. At some point you should spend your money on experiences, not assets.

#137 Hubert on 05.18.12 at 12:15 pm

#96 John

Crushed.

Next.

#138 Snowboid on 05.18.12 at 12:18 pm

#45 Karie on 05.17.12 at 10:59 pm…

It’s not if the market tanks, but when – and our plan is to buy in when it is less expensive to own (with associated costs) than to rent.

As you mention, equity only results in a ‘profit’ when you sell.

But if you are that addicted, go for it! Get that bigger house, I’m sure you will feel good for at least a few weeks!

#139 TnT on 05.18.12 at 12:30 pm

#112 Karie

** I come on here questioning renters because I want to find out their formula for financial freedom and what it is that they feel they’re doing right but what it seems like is that people think they are just priced out of the market so they’re renting. I enjoy reading about what Garth or anyone else did right through the years and what he/they regret and why Garth became so anti-real estate. **

For me it’s simple math. I want to live in “The Beeches” part of Toronto. I sold my house in Stouffville and pocketed close to $300,000.00 cash. I can easily purchase a house here in The Beeches for $600,000.00 BUT I can also rent the same house, same neighborhood for $2095.00 per month. When owning this house is closer to 15 x my annual rent then I will buy. Until then with rent so cheap I can easily save $25,000.00 a year and watch the house prices go down. And after owning and renovating 2 homes for the past 10 year it sure does feel nice to be debt free. I never go to Home Depot anymore. Weekends free to explore and enjoy the City. Wife / Kids are having lots of fun. No stress and we can simply pick up and move anytime. It’s a great feeling seeing my hard earned money go straight to my bank account collecting interest. Cheers!

#140 greed on 05.18.12 at 12:39 pm

Frustrating to read Bob Rennie’s comments.

http://www.vancouversun.com/business/Condo+king+says+talk+bubble+just/6640328/story.html

Just has no logic but I guess the Vancouver area is beyond logic.

#141 Spiltbongwater on 05.18.12 at 12:43 pm

#93 Deliberate Dumbing Down on 05.18.12 at 7:15 am

I thought free-based capitalism was some sort of junkie reference to capitalism.

#142 99% on 05.18.12 at 12:46 pm

#132 Hoof-Hearted

I’d be interested to see what happens to Hamville this summer, when Hambini’s return home for the break and activity slows. All there will be left are the locals wandering through deserted open houses. And we all know that they certainly have $1m to spend on lot value only.

#143 coastal on 05.18.12 at 12:51 pm

#140 Greed.

When the crash hits, Bobbie will be giving up his citizenship and living in Singapore. But then again the Asians may take him on a helicopter ride BRE-X style. The gall of these scumbags to totally discredit the biggest bubble in Canadian history. Fricking criminal.

#144 coastal on 05.18.12 at 12:53 pm

Next thing Rennie will spew will be “everyone making $50,000 can easily afford a van down by the river”.

#145 Toronto_CA on 05.18.12 at 1:02 pm

At Karie** I come on here questioning renters because I want to find out their formula for financial freedom and what it is that they feel they’re doing right but what it seems like is that people think they are just priced out of the market so they’re renting.**

I rent a great 1 bed 2 bath condo across the street from my job in the financial district. My rent hasn’t changed since I moved to Toronto in 2008, and my landlord is awesome. I have a 2 minute walk commute, that is mostly elevators. This allows me to work longer hours than my colleagues/competitors, one of which lives in Hamilton and takes an hour and a bit each way to come in.

Working longer hours and arriving earlier has lead me to get a promotion in just under 3 years to Controlller, and due to a boomer retirement, I could be CFO in another year. I know from commuting to Burlington in my early Deloitte days that it is no fun putting in long hours.

The rent I pay is lower than the cost of buying the condo (including mortgage interest, property tax, repairs, and condo fees). I continue to save 20.5% to my DC plan (nearly maxed out my contribution room), max my TFSA and save for the downpayment on a townhouse once the market corrects.

I don’t want to own a condo in the GTA, especially right now. But I will buy a townhouse in the next 5 years, unless prices don’t correct. In which case I’m taking my toys and moving to a city that isn’t ridiculously overpriced. Chartered Accountants are extremely in demand and extremely mobile, especially after IFRS (also trained in SAP and Solvency 2).

Hope that helps you.

#146 rb on 05.18.12 at 1:25 pm

still feasting on HAM? check these two articles:

http://brazilianbubble.com/chovanec-says-chinas-real-estate-unravelling-is-not-poised-to-recover-despite-morgan-stanleys-wishful-thinking/

http://brazilianbubble.com/deflation-ahead-mounting-stockpiles-at-china-car-dealerships-threaten-to-deepen-price-cuts/

#147 Pbane on 05.18.12 at 1:43 pm

#139 TnT

Similar situation here in Vancouver area. Rent a nice, newer 1,150 s.f. condo for $1,675 which is assessed at over $610K. That is 30X annual rent. Taxes and condo fees alone are over $600 a month. Throw in your assumed $50K leaky condo repair special assessment down the road. Not hard to crunch the numbers in Excel to see that renting is the better choice financially at these levels. The buy consideration would only begin if the rent was $2,500+ or the condo asking price under $400K. Save and do sensible, non-emotional value investing. I’m not anti real estate. I’m anti debt and pro having more money and only reasonable risks.

#148 timbo on 05.18.12 at 1:50 pm

http://www.businessinsider.com/canadian-oil-sands-flyover-2012-5?op=1

A truly fascinating pictorial on our oilsands, good and bad.

http://www.economonitor.com/blog/2012/05/closer-to-colliding/?utm_source=rss&utm_medium=rss&utm_campaign=closer-to-colliding

http://www.theglobeandmail.com/globe-investor/markets/markets-blog/facebook-pop-turns-to-flop/article2437079/

The news just gets better and better. Thank god r/e always goes up in Canada, after-all we are an island with a low household debt load. Oh wait?……..

#149 Junius on 05.18.12 at 1:51 pm

#117 Inglorious Investor,

You said, “For your own good, I suggest you extract yourself from Mr. Keen’s lower digestive tract, and maybe also learn a thing or two about finance and economics.”

You smugness is now matching your ignorance. Calling Steve Keen insane is the height of stupidity. You can disagree with him but he was one of the few economists who correctly called the economic crash before it happened AND properly set out the reasons why it would and did happen.

Who would you suggest we read wise one? The brainiacs on Wall Street who have nearly blown up the economy twice in the past 20 years?

Keen and people who agree with him would be the first to admit there are no easy solutions. That is the point.

He is one of a growing number of economists who are working to change the paradigm to more realistic view of the economy. One that understands that the economy is inherently unstable (per Minsky), that human beings are not necessarily rational actors and that the debt fueled banking system is the primary cause of our current economic problems.

#150 Junius on 05.18.12 at 1:53 pm

#140 greed,

Amazing isn’t it. Rennie speaks and it gets printed. The billions of dollars of boomer money is now going to flow into condos but who is going to buy them into houses.

Nonsense. But the MSM never asks the question.

#151 I`m Richer Than I Think on 05.18.12 at 2:00 pm

The lady at the bank told me that I have more money than I think. My wife (with her spreadsheets and such) says that we dont. I like the bank lady better. She should know better, she works at the bank.

Anyways, the bottom line is that I’m sick of living in this stinkin townhouse. I deserve better than this. I work as hard as the next guy. Why shouldn’t I have the back yard patio and bbq set that I want? Why cant I have the toolshed and the dbl garage that my friends have?

The answer is…. I can. Nothing is stopping me but the beliefe that I cant. And I will.

#152 Junius on 05.18.12 at 2:02 pm

#140 greed,

Opps. Sorry. I meant by the boomers out of their houses.

#153 Junius on 05.18.12 at 2:05 pm

RE: Bubble goes mainstream,

I spoke to a real estate buddy in Vancouver today about the softening market. He said the reason is all bad press the industry has been getting lately is causing it. “People keep talking about a bubble here but they just don’t realize that Vancouver is not like other places. My advice to people is just to wait it out and not to worry. It will be back up by the Fall.”

I just held my breath. No comment. Love Vancouver because it is different here. Until it is not. Like now.

#154 Fools and Their Money are Soon Parted on 05.18.12 at 2:17 pm

#113 Dorf

Please don’t take this as a personal attack on your mom but…as Thomas Tusser, a 16th Century British farmer, horticulturalist, chorister, musician and writer, once said, “A fool and his/her money are soon parted.”

#155 Westernman on 05.18.12 at 2:44 pm

Truth Hammer @ # 118,
Dead on again. Of course you won’t be allowed to state the obvious on this blog much longer-it’s much to “rude”.
You see, Canadians are fine, just fine with getting screwed over by their massive government entitlement machine, just don’t mention it – it’s “rude”.
This blog is rapidly deteriorating into a politically correct love-in…

Oh, stuff it. — Garth

#156 Vancity on 05.18.12 at 2:48 pm

Because greed abounds here in sunny Vancouvers I revolt by letting my wallet do the talking and refusing to buy. Most of us are not HAM or international buyers and therefore we account for most of the population with the most purchasing power. So Mr. Realtor, no market is sustained by offshore greed as Vancouver’s now seeing. I leave you with the latest slogan coming out of Vancouver, ‘Price reduced!’

#157 Devore on 05.18.12 at 3:01 pm

#89 House

But why is it that 20 years ago I don’t remember being offered 0% for 48 to 84 months financing and $8250 in Cash Incentives. Is this the new normal?

It’s the new normal, when you can drive across the border and still buy it cheaper, even with all those incentives thrown in. It’s car dealers no longer able to justify charging an extra $10,000 for the exact same product. It’s the consequence of a long period of par dollar.

#158 Devore on 05.18.12 at 3:20 pm

#102 TurnerNation

I’ve heard, savvy buyers get their lawyer to cap closing costs (and BS builder feed) on the contract. Otherwise, this:

Problem wasn’t capping costs, the costs are what the costs are, they were either known ahead of time or could be accurately estimated. The problem was buyer being completely unaware of his obligations upon closing. Just another idiot who stood in line to put his red dot sticker on a floor plan before someone else did.

#159 betamax on 05.18.12 at 3:23 pm

Mainland Chinese are already experiencing falling housing prices, and my wife’s relatives there suggest prices in several cities have already fallen 25%, far worse than officially sanctioned figures suggest.

Mainland speculators are dumbfounded to discover that their belief in perpetual appreciation — considered axiomatic, inviolate — was a fabrication. Confidence shaken and access to credit made more costly, they’re not buying in droves locally or overseas. That’s why HAM has dried up here in Canada.

Those people in the picture, then, are not mainland Chinese. They’re likely locals, born or immigrated, people inculcated with a blind faith in constant appreciation that is reaffirmed by everyone around them — and by that I mean Canadians of all stripes. The myth still lives on here, despite how insubstantial and tattered it has become.

They’re all smiling because, unlike mainlanders, they didn’t get the memo yet. Secure in their catholic faith, they haven’t heard that the Reformation’s at the door.

#160 DondWest on 05.18.12 at 3:33 pm

#125 disciple

Off topic, I’m not sure if Stefan Molyneux is controlled opposition. I’ve caught him a few times expressing anger and frustration over Zionism and what’s being done to the Palestinians. I’ve also caught him a few times debating the history leading up to the 1st World War and the 2nd World War; and how this misinterpretation of history is causing us to turn a blind eye to the problems of today. Shortly after this discussion, he even subtlety mentioned the Bolshevism movement and Israeli religiosity as an ugly aftermath of both World Wars. And yes, he even dared to throw in the words “Jewish intellectuals” as catalysts who started these movements that have so far killed millions.

I’m sorry, but no establishment hack would dare tread in this area. From personal experience, I know there is no other topic that brings greater discomfort to a conformist. To even mention this in a military city such as Halifax, where I live, would lead to a quick death. I would gain greater acceptance amongst the populace announcing I’m a loony scientologist than explaining the bitter truth of what happened in the aftermath of World War II; leading all the way up to the events of today. To quote Molyneux as he stopped himself from going off tangent, “sorry, you just can’t talk about it.” His reaction may lead me to believe he’s being bribed to “shut up” about certain issues or perhaps even threatened, but that’s a far cry from an establishment hack. It’s possible he may face repercussions in the future for “slipping up” in that particular podcast I listened to. . . Though, when he did slip up in that rant; it was like a breath of fresh air. Made me laugh.

#161 Hubert on 05.18.12 at 3:34 pm

#105 John saccy on 05.18.12 at 9:03 am
To All risk takers…

DO NOT SHORT FACEBOOK……… atleast for a week.

The premium on options will be very very high. Watch the sucker go past $80-$100 in a very short period and then time the Puts for a strike price of $70-$75.
.

Ha ha ha. Ha ha. Ha.

#162 ozy - I totally agree, I think the same on 05.18.12 at 3:56 pm

#118 truth hammer on 05.18.12 at 10:53 am

You wonder why the government has hyperinflated the cost structure of everything? It is to raise tax revenue to pay for the skyrocketing expense of paying for all the richly entitled parasites entrenched in the Canadian system from legacy decades of Liberal pandering to the whiny socialists. ”

*******************
I totally agree, I feel the same, the expensive low-productivity fellas will be immediatelly targeted when yankees take over of remains of corporate canada and start running them with an iron, collonial hand.
Don’t be scared, it is coming in years ahead folks, the dolce-vita cannot continue, just ask the Greeks.

#163 DondWest on 05.18.12 at 4:09 pm

DELETED.

You are not welcome back on this blog. — Garth

#164 Bigrider on 05.18.12 at 4:15 pm

# 123 frank the skank and # 131 greed.

You are both fools and Garth has been to nice to you by simply telling you that you have been had.

You are not earning 5% a year. It is a notional value only subject to a withdrawal structure that is not flexible. The true rate of return, depending on how long you own the contract, will be somewhere around 3% at most and much less at worst.

A simple example, 100k invested for 10 years gaurantee of 5% means you have 150k. You ten start to withdraw.depending on contract details all a little different you will be entitled to 5% a year or 7500 a year for life. To be perfectly clear you will not be able to withdraw your total 150 in one shot. You will only be entitled to market value if you do so , up or down, guarantee gone.

Now spreadsheet that annuity of 7500 , run a couple of longevity expectations , say 20 years or 30 and tell us what you have actually made as a return.

As Garth says and a take from the old Sanford and Sons comedy TV show of yesteryear ” you have been had bad”

#165 Michael Hawk on 05.18.12 at 4:16 pm

ONE HUNRED AND SEVENTY SECOND !!!!

#166 Canadian Watchdog on 05.18.12 at 4:16 pm

Genworth Financial Inc.(GNW) New 52 week low today $4.80 (-2.41%)

Genworth MI Canada Inc. $19.64 and falling. http://tmx.quotemedia.com/charting.php?qm_page=48101&qm_symbol=MIC

There’s going to be some serious problems for Genworth at this pace. Wait until Aussie home prices come rolling in negative again.

Get your popcorn ready.

#167 josh on 05.18.12 at 4:32 pm

#45 Karie
“My friend bought his house for $590,000 4 years ago in my ‘hood and his next door neighbour just sold for $865,000 so this is how you get tempted to keep going up and up. That’s why people are saying real estate is like crack and it’s hard to stop buying.”

It’s not just about the amount of money you make, but the RISKS you took to get that money. It sure looks nice if it pays off, but what if it doesn’t? For every person like your friends who makes a bunch of money on the way up, there is at least one person losing money on the way down. Also, if you keep placing bigger and bigger bets you will eventually lose. Does your friend have the discipline to park some of those profits in a safe place? Why do you think Vegas can afford to build all of those big casinos and run all those lights 24 hours a day. It’s not because everyone is walking out a winner.

Also did you realize that your friends rate of return is only 10% on the numbers you gave? Plenty of stocks out there that can offer the same or greater return. Just imagine if you had bought the same amount of Apple stock 4 years ago!

#168 A new name today on 05.18.12 at 4:32 pm

I know the people that sold that house in Kits. It was a legitimate sale.

They were told that the person who bought it was going to knock it down and build.

As for the new price, yeah good luck. Maybe they decided they couldn’t make money with a new build, maybe they always intended to flip, but they’re not getting $1.8 million for it, no way. It’s in an OK location, but right across from St. James Community Centre which is at Trutch and 10th. It’s also just a block from 10th. Not terrible, but also not the most ideal spot.

#169 truth hammer on 05.18.12 at 4:45 pm

DELETED.

I warned you. — Garth

#170 WPG_Savant_Syndrome on 05.18.12 at 4:48 pm

@Immigrant
What issue do you have with immigration? Aren’t you an offspring of an immigrant? Are you trying to keep Canada for yourself?
——-
How you got the impression “I” have a problem with immigration I can only guess……. my problem is with the heightened pansy sensitivity of some calling others; “rascist” or “Xenophobic” when they are clearly not. You might be in this camp from your post.
But to answer your question about immigration…….none, however the overwhelming majority feel Canada is full and have had too many come too fast which is negatively affecting a huge pocket of “native life”. They have a point and the MAJORITY of them are NOT racist or xenophobic.
Read this article and the 2300 comments to get a better sense http://www.theglobeandmail.com/news/national/time-to-lead/why-canada-needs-a-flood-of-immigrants/article2423585/
—————
@ Diana
1) Re-read your definitions
2) Does having to look up the definition of words you have been freely and unjustifiably calling people your whole adult life make you feel any less “smart”? How about prejudice? http://dictionary.reference.com/browse/prejudice

#171 Einzatgruppen kanada on 05.18.12 at 4:49 pm

Fools they’re all gonna end up hating each other for getting drawn in. This pic is endemic of what happened amongst the local Spanish population just a few years ago.

#172 greed on 05.18.12 at 4:54 pm

#155 Westernman

The reference to “rude” was the way of the lexicon and not the body. Politics is not my forte as it usually attracts the likes of you two.
Enjoy!

#173 Junius on 05.18.12 at 5:09 pm

#118 truth hammer and #162 ozy,

The constant attempt by the right wing to paint the entire Greek situation as “driven by entitlements” is such a smoke screen and a lie. The problems are far, far more complex than that. If that is your focus then you are missing the bigger picture. The core problems come from the international financial system and not the entitlements.

Good video from Richard Parker on this in today’s Huffington Post:

http://www.huffingtonpost.com/2012/05/17/richard-parker-greece_n_1524951.html

#174 Junius on 05.18.12 at 5:11 pm

#155 Westernman,

Entitlements are too high. We know this because they are unsustainable. However they are the symptom and not the cause of the problems.

#175 Westernman on 05.18.12 at 5:17 pm

Ozy @ # 162,
Careful now, you are treading on sacred ground critiquing Canada’s finest goverment workers, we need them, who would take care of the helpless masses if their “jobs”, snicker,snicker… where given to privately owned entitys… it’s practically “rude” to even broach the subject …
It is an honor and a privilage to keep them swathed in luxury with my tax dollars…

#176 Junius on 05.18.12 at 5:23 pm

#159 Betamax,

The disappearance of HAM is even more surprising considering the enormous outflow of money from China these days. The numbers right now are staggering. It could create enormous problems for China and the world markets. See this article:

http://ftalphaville.ft.com/blog/2012/05/16/1002681/why-chinas-rmb-exodus-is-the-story/

#177 Inglorious Investor on 05.18.12 at 5:28 pm

#149 Junius on 05.18.12 at 1:51 pm

So far you’ve said nothing to counter my argument against his proposal. Instead of so obsequiously defending the glory and honour of your dear Mr. Keen, why don’t you try to actually argue the point at hand? If not, don’t waste my time.

#178 Bill Gable on 05.18.12 at 6:14 pm

“It was….so QUIET……” (*How quiet was it?) – I have a buddy who has been hitting the kool-aid as hard as his moronic agent.

Vancouver listing for a two bedroom in a 40 year old, frame building – 890 square feet – for nearly 470K.
The last month the sign languished on the lawn.

My pal asked me what I thought the problem was.

I was about to go into the song and dance, but instead directed him here. I asked him to put on the coffee and read six or ten of the last entries, by Mr. Turner, and then we’ll talk.

The sign came down Saturday.
One agent unhappy.
One friend thinking he was about to cash out – humbled.

He didn’t call.

He can read.

#179 Linda on 05.18.12 at 6:15 pm

I visited a friend out in Victoria, BC, for the first time back in 2001. Back then, she and her husband were living in a small, 2 bdrm townhome just outside of town. They put me up in a cot in the spare room that doubled as a home office.

In the summer of 2003, they were living in their centrally located, newly built 3 bdrm SFH which they’d purchased before unloading the townhome. Thanks to a booming real estate market, they were able to sell their townhome without complication and for a healthy profit.

In 2006, they sold the new build for another tidy profit and bought a much older, 4 bdrm house near UVic. They paid roughly $625K.

For the last few years, houses in the area have been selling in the high $700Ks and into the $800Ks.

Since moving into this spacious home, the kids have started attending private school. They’ve taken multiple family vacations: skiing in Washington, sunny escapes to California and Mexico, camping trips in the new 5th wheel in Tofino, etc. They’ve wined and dined in high end restaurants and have visited golf resorts. They each drive their own car. Their garage is teaming with all manner of sports equipment. Their landscaped backyard boasts a deck and hot tub.

Oh, and did I mention their sizable HELOC?

My friend, God love her, is a spendaholic: clothes, shoes, jewelry, handbags and Grey Goose vodka. She is living the life! She goes for the full spa treatment regularly, and I have to hand it to her. She looks great! She definitely has the air of someone who is pampered and prosperous, despite working full-time and raising a young family.

Unfortunately, the *bleep* has hit the fan in the last year because the marriage is now over. They are both under enormous stress because reality has come knocking.

There is very little equity in the house, and once sold, they will be lucky to each walk away with money in their individual pockets. Their agent has advised them to put it on the market at just over $700K. If offers way below asking start coming in, my friend said, they don’t know what they are going to do.

Life is going to be a lot different for this family from here on in.

#180 Junius on 05.18.12 at 6:32 pm

#167 Inglorious investor,

Ditto. Stop wasting mine. You haven’t countered a single argument I have made.

#181 jess on 05.18.12 at 6:42 pm

George W. Bush Writing a Book on Economic Growth!
http://thinkprogress.org/economy/2012/05/16/484981/bush-economic-book/?mobile=nc

————–

Tom Ferguson: Senate Banking Chair Calls Jamie Dimon to Testify -– But JP Morgan Chase is His Biggest Contributor!

Tim Johnson is from South Dakota, the state which first threw out its usury laws in the early 80s to attract credit card issuers to their state.

http://www.creditcards.com/credit-card-news/marquette-interest-rate-usury-laws-credit-cards-1282.php

#182 Mr Buyer on 05.18.12 at 6:44 pm

#155 Westernman on 05.18.12 at 2:44 pm
Truth Hammer @ # 118,
Dead on again. Of course you won’t be allowed to state the obvious on this blog much longer-it’s much to “rude”.
You see, Canadians are fine, just fine with getting screwed over by their massive government entitlement machine, just don’t mention it – it’s “rude”.
This blog is rapidly deteriorating into a politically correct love-in…
……………………………………………………………….
This tripe reminds me of the whole gun boat deniers during the Kerry Bush election run off. There were a group of people that stated that Kerry did not carryout the heroics he did that day he attacked head on those that were shooting at the boat he commanded. Well the evidence by the gun boat deniers was non-existent to be kind yet they received front page, top story billing repeatedly. This was clearly not a case of fair reporting but rather mere propaganda in the worst form. In any rational society DATA is of prime importance and as such I believe the corruption of DATA to be a grave offence, as grave as any in said society. Dissemination of corrupt data, especially reporting assertions as fact and giving these assertions equal billing, time and credence as fact is not avoiding censorship but rather corrupting the truth and thus corrupting data. Somethings are nothing more than small type footnotes that should be prefaced with statements like “while unproven,” or “while found not to supported by reliable evidence…”

#183 Mr Buyer on 05.18.12 at 6:47 pm

#155 Westernman on 05.18.12 at 2:44 pm
…………………………………………………………
The news is bad so discredit the bearer of the news. Yet another ham fisted PSY-OP 101 tactic.

#184 Nostradamus Le Mad Vlad on 05.18.12 at 7:03 pm


Holy hot damn sum ov a gum! Today feels so fiscally and emotionally bankrupt (insert your own words). Is it time for a long weekend yet? Mebbe I can get a few trillion dollars in looted bailout moolah by Wednesday. Where is The Spanish Inquisition when they are really needed?
*
0:41 clip Good reason to load up on Garth’s 40-60 mix; Quadrillion? Pocket change for Garth’s groupies! Apocalypse Now? No, within a few months give or take; GS, Greece and Spain “Worth another look in light of the underhanded Goldman Sachs dealings that destroyed Greece.” wrh.com. Be curious to see how far GS is involved with the whole Euro schnozzle; Conspiracy Theory “There is talk in conspiracy circles about a bankster plot to reduce the world to slavery. Unfortunately, the conspiracy theorists are right.”; Signs, signs Everywhere there’s signs; Shrinking USPS 28K jobs in the balance. What will happen to Canada Post? Austerity banxter style; 1:38 clip “There is only one solution to this problem, the same one used by Iceland. Throw the criminal money-junkies into prison. Write off the debts created through fraud and manipulation. If you cannot do it, We The People will, adding the third part of the Iceland formula, which is to fire the government.” wrh.com; Stimulating Austerity Both sides of the same coin.
*
Medvedev warns of war, and Nuking Syria? Fukushima on one side, the ME on the other. Depop time? Iran – Israel The elite have taken cover; Vermont bans fracking; NATO looking for a fight in central Asia; GPS loss caused fatal drone stuff. So if GPS is shut down world wide, due to a solar storm and whatever, this planet could be a droneo-free zoneo! SArabia Now that Libya, Syria and Lebanon have been or will be invaded, next on the list is SArabia. Interesting to see when China, Russia, India and Pakistan have had enough of this; G20 45 officers to be arrested; Big Brother Now that’s snooping! Plus Beward of iCloud! Snooping software; Iran and IAEA US and Israel will be mighty pissed off at this, as both are running outta money — they need this war; Good Security The US military is falling to pieces.

#185 John G. Young on 05.18.12 at 7:09 pm

#163 DondWest on 05.18.12 at 4:09 pm

“I had the courage to tread where everyone else would dare not tread. I told her like it is, “what do you need 300K for? Tomorrow you’ll most likely be dead, you greedy little b***ch!”

Wow, what a brave, brave man you are — taking on an 85 year old widow like that!
Reaffirms my faith in The Youth Of Today.

“I might have shown better restraint, had I not had to endure her fickle conversation about her precious postage size lot garden for over one hour!”

OMG!! How insensitive of her to not talk about the things that YOU’RE interested in — like YOU, for example.

“The bungalows are mostly populated by bitter old widows who feel their life is incomplete unless they rip off a “young punk”…”

Yes, everybody’s thinking MUST revolve around you — how could it possibly be otherwise?

I’ve read some unbelievably nasty postings on this blog, but yours takes the cake — and that’s no mean feat. You have just managed to affirm every stereotype of young people as the venal, self-absorbed, entitled, empathy-challenged, soulless creatures I encounter daily.

I hope you find your dream house and when you do, do us all a favour and never, NEVER venture out.

And BTW I hope you got that vasectomy.

This vile post slipped past me earlier today. I apologize to readers for having published it some hours ago. The post has been removed and DondWest is history. — Garth

#186 lil RoNiE on 05.18.12 at 7:12 pm

sm @ 48

lil RoNiE here

you’re making mad excuses bro, take care of your family instead of dumping her off in some overpriced cesspool, yo momma is the reason you’re here giving us poor folk drunk wisdom..check it son!

#187 Devore on 05.18.12 at 7:31 pm

#178 Bill Gable

Vancouver listing for a two bedroom in a 40 year old, frame building – 890 square feet – for nearly 470K.
The last month the sign languished on the lawn.

My pal asked me what I thought the problem was.

The same problem as with anything that isn’t selling: the price is too high for the value the buyer is getting. He either needs to add value (real, such as through strategic renovations, or fake, such as with staging), or lower the price.

#188 };-) aka DA on 05.18.12 at 7:45 pm

DELETED

#189 daystar on 05.18.12 at 7:50 pm

#173 Junius on 05.18.12 at 5:09 pm

Quite right. The story with Europe is not one of “entitlements” but moreso of government direction concerning what drives economies then and now. With Greece it was wreckless spending on military in the early 2000’s. With Spain and Portugal they decided to overdevelope housing instead of kickstart manufacturing through incentives especially at the bank level. Ireland, Iceland, the U.S., the same thing, load up on housing construction and overvaluations leading to overdevelopment and RE/credit bubbles that await a sure fate.

The same fate awaits Canada, Australia, France, Singapore and on some levels, China where where governments engineered a housing bubble by simply giving into our banks every demand for easy money when the hard money needed to be earned through commodity development and having some kind of rising currency plan with manufacturing. All weak governments either through greed or want of power or corruption facilitate banking desire to overvalue and overdevelope RE in the effort for more market share and as a consequence, a credit bubble forms breeding recession.

Look at the GWB era where corporate america wished for a housing bubble and they got it through elected corporate lobbyists only for their people and customers to pay dearly for the generation that follows! Maybe Canadians will finally clue into what strong government does through simple budget legislation and regulation, keeping corporate greed in check. Readers, it can’t be done by those who lobby for corporations during their pursuit and rule of power. Elected corporate lobbyists are the last people to represent the full needs of Canadians in general, especially the longterm for greed/pride is blinding. Look for the corporate lobbyist Stephen Harper to blame the destruction of his works (RE/credit bubble) on “entitlements” and socialist systems going forward.

#190 Onemorething on 05.18.12 at 8:08 pm

MS bought all the Fadbook shares to hold at 38.00. Wait and see Mon Tues.

The Seagull represents the banks and government, the ice cream your assets, the poor fellow just finished a budget shop at Walmart and wont last through retirement.

He has already outlived his money but he’s a lost gen guy so he’ll work it out. Boomers are done!

#191 Dan in Victoria on 05.18.12 at 8:21 pm

Karie @ 112
“I want to find their formula to financial freedom.”

Sell the debt to someone else.

#192 truth hammer on 05.18.12 at 8:35 pm

blah blah..you know I’m right…deal with it.

#193 Aaron - Melbourne on 05.18.12 at 8:38 pm

Here’s the New South Wales Government’s attempt to sucker in more greater fools with stamp duty concessions for an unbuilt box in the sky….

Video
http://media.theage.com.au/national/selections/six-weeks-to-save-on-stamp-duty-3303240.html

(pardon the accent, we don’t all speak like this or like our horrid nasal PM).

#194 Junius on 05.18.12 at 8:49 pm

#189 Daystar,

I don’t disagree with you but my point is that to blame the current financial crisis on entitlement programs is a deception being used by the political right as a distraction from the real causes. There were lots of reasons the entitlement programs grew including demographics and other things like cheap oil. Entitlements will have to shrink.

However the attempt by the political elites and the banks yet class to use them as an excuse to impose austerity and as a distraction from the financialization of our political system is criminal.

#195 CrowdedElevatorfartz on 05.18.12 at 8:59 pm

Damn!
Had too much spicy food last night!
Johnny Cash was RIGHT!
Toilet beckons
BPOE is handcuffed to the seat ;)

#196 Westernman on 05.18.12 at 9:05 pm

Mr. Buyer @ # 182,
Not supported by reliable evidence, huh?
Just look at your deductions on your paycheck and then look around at what your getting for the life energy you traded… you may think your getting value for your dollar but i sure as hell don’t…

#197 Gun Boat denier on 05.18.12 at 9:34 pm

I couldnt reisit this new blog handle.

173 Junius – you do realize that guy worked for the greek government.

#198 greed on 05.18.12 at 9:35 pm

#164 Big Rider

Hi
I think you missed part of the original discussion.
I would never buy segregated funds.
But thanks for the info.

Have a good weekend,

#199 Dan in Victoria on 05.18.12 at 9:40 pm

Linda @179
Your friend is one of many, many people here in Victoria living / enjoying that lifestyle.
Hopefully they get out early enough to break even.
Some areas are still selling well.
In the end was it worth it?

#200 Bill on 05.18.12 at 9:59 pm

Garth… Good on you for taking a stand against small minded ignorance.

#201 daystar on 05.18.12 at 11:29 pm

#194 Junius on 05.18.12 at 8:49 pm

Don’t disagree with you either. Your point was already taken :) but the truth is worth repeating. Needed social spending is generally made unaffordable through unsustainable debt caused by chronically needless taxcuts and wreckless public spending in areas that neither generate productivity or sustainable wealth. All too often public social spending is the scapegoat of bloating debt that is all to often caused by needless tax cuts to business and the wealthy.

I do feel however, that some social spending is also mis-spent but there too, especially in the case of presciptions where there is HMO collusion to milk the public coffers through the overprescription of overpriced drugs. Corporate lobbying in our institutions of education and medicare are quite extensive in terms of drug treatment. If governments truly wanted to save money, they would nationalize some area’s of drug manufacturing taking the for profit agenda out of the equation and spend 20 times what they do in the areas of prevention and reasearch in diet and stress related diseases but corporate america would never let that happen without a major fight and as long as corporate lobbyists remain in power, nothing will change.

#202 villain? on 05.18.12 at 11:33 pm

#104Toon Town Boomer on 05.18.12
“If we don’t wake up soon we will all be working 24/7 to buy shacks and all those shrinking food boxes we pay more for now. Aren’t you tired of being ripped off? COME ON CANADIANS UNITED WE STAND”

If we are all buying the shacks, then WHO will be buying the mansions and the better homes?

Seriously… Someone has to…

#203 villain? on 05.18.12 at 11:37 pm

#54 Anonymous,

“Canada is still a heck of a lot cheaper than most European countries and most other 1st world nations. Canadian home prices are only about half of what they will be in a few years time, they are BARGAINS compared to most of Europe, and anyone who doesn’t understand this fact simply has not lived and traveled to Europe enough to wake up and smell the putrid truth! ” )

Bull, this is. Lived in Europe long enough, your statement is simply not even close to the truth!

#204 John G. Young on 05.18.12 at 11:45 pm

#200 Bill on 05.18.12 at 9:59 pm

“Garth… Good on you for taking a stand against small minded ignorance.”

Hi Bill,

I’m not as charitable as you. I don’t think it’s ignorance — I think it’s hatred, pure and simple.
The people spewing this bile are the same ones who rail against “political correctness”, so I say give them a taste of their own medicine.

Cheers,

John

#205 Karie on 05.19.12 at 9:05 am

@sj – Each time we moved up yes, mortgage increased by only about $40k because we made a decent amount of money selling the homes. Mortgage will paid off before retirement.

My regret is having been so conservative, we could have made tons of money in the past if we bought bigger homes. Looked at a lake home about 10 years ago selling for $250k. Properties on that lake are now going for over a million.

Calgary family, Beaches family, Accountant guy, Arshes – thanks very much for sharing! I read your posts over a few times. Pretty awesome what you’re doing and saving!! Arshes, sorry about your dad.

We lived and bought 2 homes and lived in the city many years. Live in the suburbs now, paying $285 on a weekly accelerated plan to pay our mortgage off sooner. We can pay less and monthly if we want to. Also pay property taxes on top of that of course. Make monthly contributions to RRSPs and RESPs. Spend a lot on kids extra curricular activities. When house is paid off, we can save more. Still not for renting.

@Snowboid -Looking at a house with a swimming pool for $150k more than I think I’ll sell current house for. We would be able to manage the payments. Often read Garth but just recently started reading the comment section. Something seems to be stopping me from putting in an offer because I keep coming on here. It would be really great to have a pool…

#206 Karie on 05.19.12 at 9:20 am

@167 Josh – It was my friend’s neighbour but of course that has now got him tempted to sell. I have had some stocks and mutual funds that have done okay but nowhere close to 10% over the past 10 years and we unfortunately bought Nortel and RIM.

@Linda – Your friend sounds like she has had a great life and fun lifestyle for many years. Good for her! Sure, life will be different but if she has her health and a job she will be fine!

#207 Bobby on 05.19.12 at 9:35 am

For #123 Frank the Skank,

Sadly my friend, the only thing that is guaranteed is death and taxes. Believe me you are paying through the nose for your supposed guaranteed investment. The financial services interest thrives on people such as yourself buying products such as this.

The main reason you are committed to staying in these products for such a long time is they are using your money. They know if you saw the real costs, you’d bail.

Let me guess, you have a financial adviser. Or should I say you take advice from a commissioned salesman.

#208 Jonno on 05.19.12 at 2:48 pm

#105 FB options I don’t think you have traded options on an IPO before ?.. there won’t be any options until may 29th on FB and they will be priced with a wide spread. I wouldn’t touch them until the lockup expires and some direction for the stock is clear. If it does shoot way up… then buying puts could be wise if priced appropriately. Good luck!

#209 deja view? on 05.20.12 at 8:39 pm

This experiment that is Canada isn’t going to end well.
Then there’s the genetically engineered lives of the less well-to-do RHIs.. residual hutch inhabitants that are clawing at the air in a bizarre weekly pantomime to find that when they do get outside, they’re still going through the motions of trying to escape.
insanity now.. insanity later.
Yet another one for Jesse Ventura.

#210 Dorf on 05.21.12 at 1:05 am

154 – Fools
No worries..I just thought I had already made that point obvious.