The Peg

Apparently there are numbers of people who do not live in Toronto, Calgary or Vancouver. And they’re threatening mayhem in their cute, hick way unless this blog pauses to make a few pathetic comments on their real estate markets. This week: Winnipeg.

Alicia’s in her twenties, living in a city where she feels ostracized. Even alone at work.

“Most of my coworkers are first time buyers that bought their houses with almost nothing down and are quite young,” she says. “Some of the people I know own several condos and houses and flip them. Even at the management level, there have been comments linking home ownership with stability and the real underlying message of ‘if you’re not buying you’re not planning to work here long, therefore you are not a committed employee’.  You can imagine the repercussions of such a conclusion.”

Jim moved to The Peg two years ago. “We could not believe how much the house prices had increased. For example, houses in the desirable River Heights neighborhood that were around 100K some ten years earlier were now 400K. But we were forced to buy. There is nothing to rent.”

Jarmine knows. She just rented a condo in downtown Winnipeg. “Just remember the following,” she tells me.

“(1) Never go outside after dark.
(2) Never walk down the street alone, especially if you are a woman.
(3) Carry “muggers money” $50 should be enough.
(4) Always be one touch tone away from a 911 call button.”
Winnipeg stirs more emotions than you might realize. Some see it as a frozen, flat, windswept period piece, a grimy anachronism from the railway age, with man-eating bugs and the worst climate of any major Canadian city. Others say it has the heart Toronto lost, an economy based on real commodities instead of Starbucks and a lusty future epitomized by a housing market on steroids and cool prairie rap.

A decade ago the average house sold for $95,000. Now it’s $245,000. Detached homes fetch over $300,000, and the city’s girdled with subdivisions where new builds are $500,000 to eight large. Real estate has appreciated by 158% in ten years, eclipsing even Vancouver. Demand seems insatiable. Recently, for example, there were only 27 houses for sale (out of 3,000) between $180,000 and $300,000 – in a place where the average family earns just under $75,000.

Not long ago that family could buy a decent house for less than two times annual income. Now it’s four times. Hardly a match for the eight ratio in 416 or ten in Vancouver. But enough to get an entire city horny on homes.

“I’m in my late 20?s,” Pat says, “and have been watching friend after friend take the plunge, regularly bidding 10% or more over asking price. Note that many are single women who make between $30-$40,000. It’s incredible the pressure I am under.”

So why have prices surged in an urban area where the population has grown a scant 10% in the last twenty years, and is arguably the arson capital of the nation? Why is there only a two-month supply of houses for sale when most other cities are going flaccid? What are we missing?

Yesterday I spent time with Peter Squire, the MLS market analyst for the local real estate board, trying to understand the tightest market in the country. “The biggest reason,” he admits, “is because we have such a limited amount of rental housing, and now such an aggressive immigration program. It’s put a huge amount of pressure on prices.

“And there are reasons why a new home here now costs $400,000, like trades. With so much building, they’re at a premium, and it sure adds to costs. We have far more expensive homes here than people in other places realize.”

It’s hard to overestimate the lack of rental housing. Squire says Winnipeg has the lowest vacancy rate in Canada, and yet a provincial policy which is channelling immigrants from North Africa, South America and the Philippines into a city where competition has forced rents higher than in downtown Toronto. “Some people might not be ready to buy, but they have little choice.”

And this, more than the dodgy neighbourhoods and sparrow-sized blackflies, is what makes The Peg dangerous. While real estate values have more than doubled, wages have barely moved. A rapid and artificial price explosion has brought the inevitable scourge of speculation and greed. Massive increases in sales prices mean a burgeoning of household debt, most of it in mortgages destined to reset at higher rates. A commodity-based economy in a world of slowing growth and runaway volatility is an uncertain foundation.

But mostly, Winnipeg’s greatest-ever real estate boom has birthed a bad attitude.

“People who are buying now reassure themselves by saying Winnipeg is ‘just catching up”’ to different centres,” says Jarmine.  “But, they miss the obvious differences between Winnipeg and other centres. No amenities. Portage Place mall guards wear bullet-proof vests. The transit system sucks – buses. Houses you can afford are on streets you can’t live on. But we do have the Jets. They finished fourth. So, are they worth a big, fat mortgage?’

Hell, no. Not like the Leafs.


#1 View on 06.13.12 at 9:47 pm

Your awesome Garth

Get back to your ironing. — Garth

#2 T.O. Bubble Boy on 06.13.12 at 9:51 pm


Bubble is justified based on immimgration – where have I heard that one before?

#3 The guy in the Orange Shorts on 06.13.12 at 9:52 pm

Fiiirrssttttt (and with cold beer too)

#4 YukonRanger on 06.13.12 at 9:54 pm

Do Whitehorse next please :)

#5 Bandiguile on 06.13.12 at 9:55 pm

Damn! Relocating soon from Vancouver to Winnipeg. I was happy to finally be able to afford to buy a place and now I’m doubtful it’s a good move.

I’ve been checking out places for rent and it’s true the choice is extremely limited.

#6 T.O. Bubble Boy on 06.13.12 at 9:57 pm

Winnipeg housing starts on the rise… oversupply anyone?:

#7 Ed on 06.13.12 at 10:00 pm

Oh Winterpeg;

Thought you were talking about Edmonton. Someday do a piece on the hole they called Nanaimo (“7 potatoes” in Japenese); lots of atmosphere here–aging bikers, ancient retirees behind the wheel, needles on the beach and rat-infested slums for the low 300s.

#8 timbo on 06.13.12 at 10:00 pm,4

“The Chinese shopping spree. Despite the headlines and political rhetoric, China is not coming to Europe’s financial rescue. That’s not to say that every time a senior Chinese economic official lands in a European country promising increased investment, they’re lying. But there’s a big difference between bailing out a country with huge amounts of cheap funding for its sovereign and looking around for potential bargains once forced sellers of distressed assets find themselves without other options.”

China loves to window shop at thrift stores………

“Canada’s boom, related to the exploitation and exports of Alberta’s Oil Sands, has brought boom times to the resource-rich areas of Western Canada. However, an article in the Global Post highlights how the boom is dividing Canada: Western politicians are pushing for more oil-centered exports, while politicians in Ontario and Quebec, Canada’s traditional manufacturing heartland, are saying that increased oil exports have undercut their ability to manufacture”

I don’t feel very dutch, yet…………

#9 Can it be? on 06.13.12 at 10:01 pm

@gmaz… “how do you explain houses selling over asking in past months”…

you just answered your own question… it was in the past. Here and now today… the situation has changed. There are 5 houses on my street alone.. a desirable neighbourhood in Mississauga where things were on the market for a short time. Now… the market is a standstill nothings moving. My neighbour says people are cheap. My realtor in oakville says 90% of the offers she gets are low ball offers. My friend in Thornhill in on the 6th week of her listing and not a single offer. Her realtor tells her nothing is moving. She knows how much she has to reduce to sell.. the number is huge and not what she wants to do. Things have changed since May. I’m not sure if you are looking to buy, because if you are… this would be exciting news to you. If you are a realtor… I guess it cuts your commission… but realtors make money wether the market is going up or down… they just need to sell. Good luck on your move. I assure you that things have changed, it’s blatantly obvious. FYI. A realtor once called my husband to come over to a deal he was trying to close to pretend like he was interested in the house. So he waited in the car confused on what he was doing there. The realtor was so angry that the deal was taking so long. There are a lot of unethical people out there… be careful who you get your information from.

#10 mark on 06.13.12 at 10:02 pm

Tell us what horrors will be unleashed on Prince George, Garthy (besides the horrors that already exist there).

#11 LuckyRenter on 06.13.12 at 10:02 pm

OECD sees signs of Dutch Disease affecting non-resource provinces in Canada:

By Julian Beltrame, The Canadian Press

The OECD is weighing in on the controversy surrounding whether Canada is suffering from an economic condition known as Dutch Disease, and it’s qualified answer is yes.

The Organization for Economic Co-operation and Development warned in a report Wednesday that the run-up in commodity prices is leading to an uneven economy in Canada.

And it says the country needs to do more to develop non-resource aspects of the economy in order to maintain high levels of employment and an equitable distribution of wealth across regions.

As it has noted before, Canada faces a potential future risk over the high levels of household debt and real estate prices.

“Low interest rates are, for now, keeping mortgage and debt-servicing affordable for most, but the share of indebted households spending more than 40 per cent of their income on interest payments remains about the 2000-2010 average,” it warns.

More here:

#12 Can it be? on 06.13.12 at 10:04 pm

Just checked MLS… and to my surprise listings are back on in North Toronto… and there are lots of them on individual streets, quite a difference from Monday to Wednesday. Someone must be reading your blog ;)

#13 East Van on 06.13.12 at 10:04 pm

#14 theworstone on 06.13.12 at 10:08 pm

Great post…. as mentioned before, never been in “Win-a-pig”, but based on your prose I am not looking for it in a meanwhile….

“And this, more than the dodgy neighbourhoods and sparrow-sized blackflies, is what makes The Peg dangerous…” This is poetry, in its purest form….

Actually, I have been thinking about a photographic project based on rundown places….. I may warm to the idea of getting some shots of the “sparrow-sized blackflies”

I thought that the BPOE was unique, but it seems that over there thing are also different…. When everything is different everywhere, maybe is the same anywhere…

#15 Popeye the sailor man on 06.13.12 at 10:08 pm

I’m sure I just talked a co-worker out of buying a 100,000 lot up Island in the near Comox. We were at sea for 4 weeks away from the wife and I showed him alot of things from this site and others, made spread sheets for him to take home. He is over 50 and still has a mortgage on his primary house of 200,000. I showed him how much it would have to go up to be worth it. How much payments will go up on both properties when renewal comes up when interest is say 7% . I showed him how much further ahead he would be if he took the payments and applied them to his home and if land values drop only 3-5% a year for a 5 years. Basically if he falters and lets the wife talk him back in to it he will be out about 50 grand at least in five years on a 100K lot.

#16 Nick on 06.13.12 at 10:11 pm

I’m originally from Montreal and if I had a dollar every time I heard the ‘Just catching up’ argument I would be posting this from a penthouse on 5th avenue with Warren Buffett bringing me refreshments every now and then. ‘Just catching’ is as worshipped as God’s word in Canada and should be printed on every license plate.

#17 CrowdedElevatorfartz on 06.13.12 at 10:11 pm


Skeeters in clouds thicker than the german bombers over London during the blitz.
Portage and Main wind chill at -60..

Weep for them……

#18 thinker on 06.13.12 at 10:19 pm

Whatever happened to all those OSFI rules, F plan’s, etc? Nothing has come into law has it, plans on how to enforce the affordability?

As published here, OSFI has said regs will be in place by the end of 2012. — Garth

#19 Just Park it on 06.13.12 at 10:20 pm

2 facts I would like to make – first, Garth was spot on about the housing market being localized, in the Barrie / Newmarket area, houses are selling in days. I have yet to see a for Sale sign without being slapped with a sold sign for more than 3 weeks. There moving baby – what down turn!!

But, on the other side, father-in-law told me that for the 2nd time since he purchased from floor plans from a builder in Georgetown, they have pushed his closing date down the road. It first was supposed to be this November, then January and now next june. Does anyone have a “intelligent”reason why that is. I was told due to the lack of skilled trades people, and someone else said it was due that if sales are sparse, they hold off ?

I just can’t seem to put my finger on that one!!

#20 West coast on 06.13.12 at 10:21 pm

“… and yet a provincial policy which is channelling immigrants from North Africa, South America and the Philippines into a city where competition has forced rents higher than in downtown Toronto”


Read: government policy messing up the natural order of things.

Time to elect people who promise they’ll do as little as possible while in power, like that maytag dude. He’d be a great politician. Hands off. It’s not broken. Don’t touch it.

#21 Foggy on 06.13.12 at 10:26 pm

Ahaha….what timing. Rob Lowe (actor) is on the news for insulting Winnipeg. Referred to it as a “hellhole” and is now backtracking.

Garth is psychic…

#22 mikef on 06.13.12 at 10:28 pm

Can’t wait for Furst’s lyrics.
So many rhyming words,
Jets,nets gets,bets,
cold,told,sold,mold,bold,fold(Thrashers that is)
Evander Kane,lane,Main/Portage,sane,rain

#23 TNT on 06.13.12 at 10:30 pm

Winnipeg, the place bad weather goes to die.

#24 45north on 06.13.12 at 10:32 pm

picture of Winnipeg:,_west_of_the_settlement,_Red_River,_MB,_1858.jpg

can you imagine a tipi in the winter!

Can it be? “how do you explain houses selling over asking in past months”…

you just answered your own question… it was in the past.

pretty funny

#25 I`m Richer Than I Think on 06.13.12 at 10:38 pm

I’m rich biatch!

#26 Mr Gadget on 06.13.12 at 10:39 pm

#27 bsallergy on 06.13.12 at 10:41 pm

Just got back from Toronto a week ago, funny to see them imitating Winnipeg. They don’t want to pay taxes anymore so the streets are all busted up. And we won’t mention the competition they’re in with with Dampcouver to build as many ugly glass walled towers of shit as they can.

Attitude is what Winnipeg is all about, hell even our beggars have attitude. The Squire is all about bluff, a while back the market was about investors coming here because it was cheaper than elsewhere. Nothing on god’s green earth made my house worth 1.5 times what it was worth 10 years ago. I look down my street knowing full well that I earn more than most of the couples on the street and know I can’t afford to live the lifestyles they do. Anyway our selfservative government created this and I hope the chickens come home to roost shortly. Crash and Burn baby!

#28 zeeman on 06.13.12 at 10:41 pm

@ “can it be”

i agree with you that there appears to be some slow down in the gta real estate but not as deep of a slow down that as you are describing.
it is far too early to say that the market has changed towards any significant correction.
the slow down could be due to seasonal as well as just a temporary drop in demand after the heavy record selling that occurred in the last few months
btw, i am not a realtor or earn a living in the real estate industry
lets see the results of the next few months of sales and prices in order to see which direction is the market headed

#29 Devore on 06.13.12 at 10:44 pm

#205 Mister Obvious

After a very long search involving months of traipsing around to highly questionable places listed on Craigslist my wife and I found a great apartment in a purpose-built rental very near downtown.

It really is the only way to go.

After selling my condo 2 years ago, almost to the day, I spend several weeks looking for an apartment, downtown-ish. I have to admit, I spent far longer looking for an apartment than looking for my condo. That’s sad. After passing on dozens of amateur (and some clearly reluctant) landlords, I ended up in a freshly renovated, professionally managed apartment building. The building is well maintained, management very professional, and as you say, by the book, and it’s been nothing but positive experiences.

#30 Sid on 06.13.12 at 10:47 pm

Went to school with a kid who lived in one of these neighbourhoods. Walking home one day, he was killed by a stray bullet.

#31 WesternObserver on 06.13.12 at 10:48 pm

#23 TNT

Excellent! Made me laugh out loud

#32 earlybird on 06.13.12 at 10:49 pm

Hilarious! Great post once again….good idea to focus on individual cities….prices are stupid all over!

#33 Market Bull on 06.13.12 at 10:50 pm

The prospect of the potentail for vindication must be quite a lure.

Revealingly and perhaps unfortunately, it tends to spwan the usual crazies, as well as an odd assortment wild-eyed grave dancers.

But little substance.

#34 BC Bring Cash on 06.13.12 at 10:51 pm

Took my lumps in the Peg back in 1994. Sold at a loss after a miniature housing bubble. Bought in 1988 and took a bath after having to relocate. The young people now refuse to learn from history. This time the losses are going to massive compared to what I suffered. Good luck to residents of the Peg. By the way, the lack of affordable rental housing will fix itself soon just like Kelowna when the Flippers are forced to rent their properties they can no longer sell at a profit.

#35 Stupesing in Cabbagetown on 06.13.12 at 10:51 pm

#14 theworstone – regarding your photographic project, did you see this one of Detroit?

#36 Bottom Feeder on 06.13.12 at 10:55 pm

Seems to me the same old story….. nice low interest rates have stirred up the desires of the citizens of a city who were previously responsible with their money. This coupled with developers who would have normally been cautious due to the low population growth. At 3% anyone can be a rock star! (No offense to BTO)

#37 WPG_Savant_Syndrome on 06.13.12 at 10:57 pm

I feel a little bummed from this post :(

You forgot to mention even Air Canada says Down Town Winnipeg is too dangerous to let their staff stay in a hotel.

Check out our crime state for district 1 (downtown) in the last year

Oh, yeah, and the Jets came in 11th. Not 4th. Good enough to beat the 13th place “makebeleafs”.

#38 Carlyle on 06.13.12 at 11:02 pm


What’s your opinion on buying in places like Hamilton or Oshawa which have prices at a much more reasonable level?

My brother bought in Oshawa for 250k. … A 3 bedroom bungalow with a live in basement that will fetch 800 a mth.

It was hard to argue with him when accounting for the rent he brings in his mortgage will only be 500 a mth …

I did say that even in Oshawa a bug drop could wipe 100k off the valuevof the home … But it got me thinking considering I pay 1500 mth on rent.

Fredericton is cheap too. All for a reason. — Garth

#39 Smoking Man on 06.13.12 at 11:06 pm

#28 zeeman on 06.13.12 at 10:41 pm

I noticed a slow down in the GTA too, three weeks ago nothing moved in my neighbourhood. In the last week all the inventory has big ass SOLD signs

wired or what

#40 WPG_Savant_Syndrome on 06.13.12 at 11:07 pm

@30 Sid

I probly know you. but he was in a back alley buying weed.

#41 O=E+R on 06.13.12 at 11:08 pm

Thanks Garth, today’s blog further galvanizes my position on housing.

Waited this long, what is a few more years, eh? There are other things to do in the meantime.

If I never own a home, so be it.

Outcome = Event + Response

#42 MP on 06.13.12 at 11:08 pm

“It’s hard to overestimate the lack of rental housing. Squire says Winnipeg has the lowest vacancy rate in Canada”

I am guessing the source would be CMHC and this article stating “Winnipeg has the second-lowest vacancy rate among the 35 cities surveyed, at 1.1 per cent.”


It isn’t even the Canadian capital city with the lowest vacancy rate.

“in the Fall of 2011 the vacancy rate in Yellowknife was 1.3% but dipped as low as 0.7% in the Spring of 2011.”


I’m guessing Whitehorse (and likely Iqaluit) would have a similar story. Lack of rental housing is a major contributor to high housing prices in the North (and apparently places further south).

#43 Carlyle on 06.13.12 at 11:13 pm


What’s your opinion on buying in places like Hamilton or Oshawa which have prices at a much more reasonable level?

My brother bought in Oshawa for 250k. … A 3 bedroom bungalow with a live in basement that will fetch 800 a mth.

It was hard to argue with him when accounting for the rent he brings in his mortgage will only be 500 a mth …

I did say that even in Oshawa a bug drop could wipe 100k off the valuevof the home … But it got me thinking considering I pay 1500 mth on rent.

Fredericton is cheap too. All for a reason. — Garth


I won’t deny it’s a pretty long drive from the core …. But so is Milton which has gotten really expensive. The south side of the 401 (downtown Oshawa) is still ghetto but north of the 401 is suburbia granite euphoria … Big lot sizes, good family neighborhoods, with plenty of big box store shopping around.

A lot of folks I know have gone west to Hamilton or east to Ajax/Whitby/Oshawa because they are the only places left within striking distance of Toronto that are still somewhat affordable.

Really though I was asking … Is it a mistake to buy in these areas on the assumption they are “cheap” and even in a downturn you don’t stand to lose “much”?

#44 JohnG on 06.13.12 at 11:18 pm

Nice post on the peg. Let’s highlight these germane facts:

-the budget relies on transfer payments
-large percent of gov jobs
-heavy taxes

The restriction on rent increases means no real new units have been built in decades. Many have been converted to condos.

And the condition of many houses, well…yikes.


#45 Canadian Watchdog on 06.13.12 at 11:23 pm

#18 thinker

Why would OSFI impose rules and take responsibility when they already seen the market rolling over? Instead, they gave lenders and brokers what they wanted, that is, enough rope to hang themselves with. It’s brilliant.

#46 JohnG on 06.13.12 at 11:24 pm

Winnipeg is overvalued by 50%. Counter arguments I hear are
-the jets
-the new centre venture trade corridor
-new airport


#47 Not 1st on 06.13.12 at 11:24 pm

Garth, its clear you have never even been to Winnipeg before. If you had, you would know that the blackflies and mosquitoes are promptly killed each summer by the weekly golf ball sized hail stones.

#48 unbalanced on 06.13.12 at 11:30 pm

If the Jets would have finished fourth, we would have been in the playoffs. They are losers and so is this town. I would move but wifey won’t leave the kiddies. Oh well, I milk the system as best I can.

#49 Sask Girl on 06.13.12 at 11:33 pm

Looks like Regina has recently dethroned Winnipeg of the lowest rental vacancy title.

#50 KingBubbles on 06.13.12 at 11:38 pm

Thanks for doing a post on Winnipeg Garth.

I have heard the “immigration” song bleated by realtors in other jurisdictions. Seems a bit weak to me for Winnipeg.

I wonder what Winnipeg prices did when compared against say housing starts and household formation over the past 10 years? I bet the Winnipeg prices could not be explained by supply/demand imbalances alone and are significantly influenced by HH & EC (House Hornyness & Easy Credit).

Just my two cents.

#51 Bottoms_Up on 06.13.12 at 11:41 pm

Working off the 3.5 metric, if the average household income is $75,000, then the average house price is affordable for the average family when in the ball park of $245,000.

The problem is…you’re living in Winnipeg. And Winnipeg shouldn’t have a 3.5:1 metric. 2:1 would perhaps seem to be more appropriate?

#52 Bottoms_Up on 06.13.12 at 11:43 pm

#46 JohnG on 06.13.12 at 11:24 pm
I feel for the poor virgins that are buying $400,000 homes in Winnipeg (doesn’t that statement seem oxymoronic?).

#53 Bottoms_Up on 06.13.12 at 11:49 pm

#34 BC Bring Cash on 06.13.12 at 10:51 pm
It’s not that young people refuse to learn, it’s that there aren’t enough Garths in the world telling like it is.

If everyone you knew hounded you to buy real estate (because ‘you can’t lose’, ‘it never goes down’, and ‘you’re only throwing your money away on rent’), it’s extremely difficult to be a contrarian and go against the grain.

#54 Pragmatic Pegger on 06.14.12 at 12:09 am

Winnipeg has long been a city where you can be “middle class”. It is changing and being driven by a chain of greed and bad decisions that links back to our own federal gov’t.

The real estate industry has taken the ball and run with it. The cheap interest, loose lending and manipulation of the available listings(yes all you gullibles please bring your offers at this time) is setting up generations of debt. There is little sense of money value with many people as they base decisions on whether they can make their payment. Hence, why not add an extra 20,000-80,000 on an offer, its only a small amount on my monthly payment!! As much as the realtors corral you to offer on a certain date and time, its up to you to say NO!!! Take control , why would you offer more and compete for these houses? I’ve seen over 60 of them now and are you kidding me?!!! You decide what the value is,walk when there is a competing bid. If you don’t we ALL lose ,me ,you and our collective kids for decades.

As far as the provincial nominee program, its essentially over and taken over by the feds.What this means is that criteria for entry and support has changed for manitoba immigrants. They are not coming like they use too.

Having moved back to Winnipeg from Kelowna, I can tell you that when the party ends its ugly. It is up to you to be prudent and wise.When that realtor tells you “if you really want it you should offer more” Look for another realtor. You will find a home be patient

Just say no!

#55 DailyReaderFromWinnipeg on 06.14.12 at 12:15 am

Thanks for the post Garth!

#56 DondWest on 06.14.12 at 12:17 am

#53 Bottoms_Up

Or maybe they feel they have no choice. Rent isn’t much better; you’re getting gouged either way. Most reasonable young people I know wish they were born 10 years earlier, so they could have bought a home 10 years ago.

#57 Listened to Garth and bought a house in the US on 06.14.12 at 12:22 am

A realtor in Kelowna told me the other day that there is a 5 year inventory of houses for sale here.

So I suspect next year or the year after the crash should be apparent.

Sellers are in denial and the buyers aren’t buying.

#58 An Cat Dubh on 06.14.12 at 12:26 am

A popular tune in European dance clubs about 8 years ago was by a Winnipeg artist by the name of Venetian Snares, his “signature” tune is “Winnipeg Is A Frozen Sh*thole”. Don’t think he lives there anymore.

#59 EJ on 06.14.12 at 12:26 am

Vacancy rate is so low because in a housing bubble, it’s easy money to just turn all the apartments into condos and walk off with the profits. Who cares what the result is, as long as you got your piece of the pie, right? Thank your government enablers for this situation.

It’s the new paradigm: only suckers work for their money.


#60 ManfredSteyn on 06.14.12 at 12:27 am

I like the idea of weekly profiles, although if you buy a house at any price in Winnipeg, you’ve given up on life, no?

#61 Observor on 06.14.12 at 12:28 am

Let’s Review Why House Prices Doubled When Incomes Were Flat…

Garth has, I believe, mentioned many times that it is low interest rates that were / are largely responsible for house prices swelling like frat house glands.

But let’s hear again Warren Buffett explain it in his own words.

Warren Buffett wrote:

“Consequently, every time the risk-free rate moves by one basis point–by 0.01%–the value of every investment in the country changes. People can see this easily in the case of bonds, whose value is normally affected only by interest rates. In the case of equities or real estate or farms or whatever, other very important variables are almost always at work, and that means the effect of interest rate changes is usually obscured. Nonetheless, the effect–like the invisible pull of gravity–is constantly there.”

Well enough of Warren, back to me now. (And please keep the applause and cheering to a dull roar)

As Warren alludes, the value of a bond rises as interest rate fall. For risk-free bonds that is a mathematical certainty. A tautology. For real estate it also true, ALL ELSE EQUAL, house prices can and in fact MUST rise as interest rates fall.

Interest rates fell enormously and house prices rose. Until interest rates rise or some other shock occurs house prices will stay high. In the case of the U.S. we got “some other shock” and house prices first fell a little which then created a vicious cycle of forclosures and a flood of houses on the market and lower prices and more forclosures and (well you get the point).

I figure interest rates are certain to rise at some point and at that point house prices will fall. They would also fall in a recession.

#62 Observor on 06.14.12 at 12:34 am


In late 2008, Warren Buffett wrote an editorial suggesting it was a good idea to buy stocks, they were cheap and might get cheaper but buying them would be a good investment long term. For about four months they continued to fall. Then they rose spectacularly.

News today indicates that while average Americans lost 40% of their net worth in the past five years, the wealthiest gained 10%.

According to CNBC today…

“New Fed data show that while the middle class lost more than a third of their wealth between 2007 and 2010, the top 10% gained. The reason is quite simple: the wealthy owned more stocks.”

Well, today Warren is still buying stocks. How about you? (Warren also suggested buying American houses right now with cheap borrowed money, locked in for 30 years would be a great investment)

#63 NAM not HAM on 06.14.12 at 12:35 am

Winnipeg is catching up a little with the rest of Canada. It’s still considered cheap there.

#64 Nostradamus Le Mad Vlad on 06.14.12 at 12:40 am

Once flew over Flin Flon. From 42,000 feet, it looked like a gem of a jewel in a snowbank. Fortunately, the next stop was BeeCee. That was the end of my cultural mission. Rob Lowe on The Hellhole.
840,000 Someone has to pay the bills; Contemplating UK looking at quitting, plus Greece, etc.; Thomas Cook Things are not looking rosy; Turbulent Times for BA; Podcast Eric Janszen on High Inflation vs. Hyperinflation; 21:04 clip Peak everything (not just yet); China US is playing second fiddle now, and China seen as leader, not US; The IMF is a front for the BdB’s (Rothschilds, Rockefellers, etc.) and Out of Touch with Reality; Boondoggle Everyone’s borrowing to lend to others to bail themselves out; Earnings Why we’re poorer than we think; Visit Greece and watch it collapse first-hand! Greeks pulling money from banks and stock up on food; 75% chance of US Fed stimulus, because it seems Sales are not keeping up to expectations; Sliding Oil Prices Don’t forget that SArabia was planning to take oil prices down to squeeze Iran, but a Huge Surge may be in the offing; Six Trillion Global central bank money printing.

Psychoanalyst In some respects, he is correct but the main reason is the Cycle Change; Walmart is addictive; Not Saving Enough to cover unexpected disasters; US500K Apt. in NYC cheaper than renting; Heaven Can’t Wait (China); Spanish Youth and The Fourth Reich; Chart Of The Day; Retirement Not as much fun as it used to be; Greece Check headline and figure it out; America No longer the land of opportunity; Oanda Fx Trading to be halted June 17? Emergencies and Money; Economics is not rational.
Smoking Man — Spoof on education (sound up!), and Sleeping On The Job Sleeping can be a lot more fun than being a brainwashed, uneducated snoozeball! 1:30:39 movie Sun Tzu’s The Art of War; Osaka Bay Water is pale yellow; Everything Runs Its Course Even snappy marriages a’twixt animals; Supercar Not the V16 Yugo, and Aston Martin Virage Suits 007; UK Swimming in the rain; Pleasure Cruise If the money is there, why not? Drumbeat of War Begun by the CIA, Mossad, Pentagon, NATO, UN etc. and US Army and military telescopes (Spying from space); Happy Bacteria are healthy bacteria; Arms Race? On eBay; Swarm of Alaskan ‘QuakesNot on USGS site.
disciple — The Light and Sound. Wot say ye?

#65 daystar on 06.14.12 at 12:40 am

Ah yes, the Peg. Vic’s are getting their toes tagged on a regular basis. (for some, stainless is a cold experience) Winnepeg could reclaim its former crown as murder capital of Canada with just 663,000 people. To put it in perspective, metropolitan T.O. has 6 million. Some of the baddest of the bad keep their drops to day visits because they know better.

Its a premium price to pay for front row seats on your typical down town weekend. Why its so violent, who knows. Fast commodity money, drugs, transients, the rest of Manitoba, pick ’em but life has less value there and why its homes have greater value… supply & demand, cheap credit, HELOC ATM’s and an organized RE gang is what I see and there isn’t much else needed other than the typical delusional mania led by greed and fed by higher valuations alone that hits all other boom towns on their way to bust.

Higher rates and unemployment light the fuse on this one and the bottom won’t be pretty when it craters.

#66 Tim on 06.14.12 at 12:42 am

Fetal alcohol syndrome , the Harlem of the praries with all the native gangs, miserable winters…I’d rather buy a house in Ecuador for $50K, where the winters are warm, the food is fresh, and, by the sounds of it, the streets are safer

#67 Andrew on 06.14.12 at 12:48 am

I’m currently in Grande Prairie Alberta. After reading this blog for a while, we’ve decided to rent.

#68 I wish you were a beer on 06.14.12 at 12:54 am

43 Carlyle Re: Oshawa:

Two things that stand out to me:
-What’s going to happen to demand if/when GM cuts one of the lines?

-Taxes are ludicrous relative to many of the other GTA municipalities…..and what’s going to happen to them when GM cuts one of the lines and cries poor.

-If a basement costs $800, the upper two floors in a similar house/neighbourhood probably only costs the $1300 mortgage payment (and no taxes/maintenance)………I’d rather live in that than in something that has a great big mortgage with my name on it. Especially in a city where GM is thinning, and may eventually do worse……….I have relatives from Flint Michigan, and have seen how ugly it can be when the one employer leaves town…..

#69 T.O. Bubble Boy on 06.14.12 at 1:02 am

ANOTHER falling glass story! How many more Toronto condos need to fall apart before this is considered an epidemic?

#70 T.O. Bubble Boy on 06.14.12 at 1:04 am

RE investor/pumper says 2013-2015 won’t be fun for Toronto condo owners, as the “cycle” turns:

#71 Carpe Diem on 06.14.12 at 1:16 am

I’ve been in The Peg a few times. The Manitoba Museum is pretty good, a few more museums are ok as well. Visiting the grave of Louis Riel was cool but the area was crappy.

One time, I was staying there during Octoberfest and as a single guy (at the time) was fun.

A few nice areas but in general I would not relocate my family for an awesome opp (which I’ve had a 3-4 in the e-health space).

I’d rather stay in Ottawa which money sense rate #1 in Canada. I do see lots of new plastic boxes with no lands in Ottawa and should take one day to write about what think of this city.

Garth, if I have the weekend, I’d love to write about Ottawa but probably would need an editor.


#72 MP on 06.14.12 at 1:43 am

@49 Sask Girl – I stand corrected from my previous post about Northern cities winning the low vacancy rate title. Regina? Who knew.

#73 Suede on 06.14.12 at 2:02 am

Prince George – Overpriced
Nanaimo – Overpriced
Oshawa – Overpriced
Milton – Overpriced
Winnipeg – Overpriced

Something is only worth what you’re willing to pay for it, except for gas. Even for $2/litre i’m still filling the Deutsche tank up. Public transit is for left wingers.

Electric cars you say? Hybrids take at least 7 years to break even and the 100% electric cars will cost you even more. What with two tiered electricity rates – just make sure you charge that puppy from 2am-5am. Green you say? – Most of North America’s energy is coal.

But i digress.

Back to Winnipeg.

Been there once for a week, 5 years ago. Yeah….I don’t think i’ll go back unle$$ there’$ a really good rea$on. Though it was cool throwing hot water from a cup in the air and watching it freeze – had to pass the time somehow.

#74 furst on 06.14.12 at 2:10 am

The Peg – A Haiku by Furst

Real Estate bliss
A city lacking
Muddy Waters

#75 Michelle on 06.14.12 at 2:11 am

I’ve been to Winnipeg twice… couldn’t tell you what it looks like though.

Both times I was stuck in the airport on a stop-over, and when I looked out the windows, all I could see was darkness and snow blowing sideways.

#76 Aussie Roy on 06.14.12 at 2:14 am

Aussie Headlines

Low interest rates make no difference when the average punter feels like this.

But ask about family finances over the next year and the answers are so overwhelmingly negative you need to go right back to 1990 to find feelings so bad.

Just 18.5 per cent of those surveyed in this month’s Westpac Melbourne Institute consumer survey expect their finances to improve in the year ahead, while 32.2 per cent expect them to get worse.

The gap – 13.7 percentage points – is the widest since the eve of Australia’s last recession, November 1990.

”This is strikingly negative,” says Westpac economist Matthew Hassan. ”To be more negative about future family finances now than during the global financial crisis is quite surprising.”

RBA gov yesterday said don’t leverage up into housing, today Westpac bank managing director Gail Kelly says “compound growth in house prices are over for good”.

AUSTRALIA is unlikely to ever see the housing boom that sparked a massive rise in personal wealth across the country in the past decade, Westpac managing director Gail Kelly told the economic forum in Brisbane yesterday.
In a closed session, Ms Kelly told business leaders that the years of compound growth in house prices were over for good.

She also said Australians were rejecting the high levels of debt that allowed them to borrow vast sums against the equity in their house.

Beware the first home buyers’ grant – it’s a poisoned chalice

If you were a cynic, you might conclude that the home buyers’ package is designed to attract the least-savvy members of the community to the most problematic and unregulated sector of property development.–its-a-poisoned-chalice-20120613-20aiv.html

What 400k buys in the USA.

#77 BigAl (Original) on 06.14.12 at 2:28 am

Re: Greece, Europe, etc.
In choosing between austerity and default, I really don’t see any other intelligent choice but to default. I hope the Greeks don’t fall for the scare tactics. What’s better? A big chunk of their pay from their daily work going to stuff the shorts and hooker/ferrari-funds of some far off investors and bankers in third-world style debt slavery founded on predatory Shylock-style loans? Or keeping your earned money and spending locally, growing your local businesses? How on earth is ‘austerity’ going to build the local economy at all? How will they be able to buy the goods or services of their local businesses? More personal debt? The austerity option is utter nonsense. How about a little austerity from the banks for a change? In fact, they’re not actually asking for austerity from the people in the form of saving money, they just want every Greek to work harder but keep less of their earned money, giving most of it to the banks. This is more like a mafia racket than ‘austerity’. I care not what happens to the predatory banks or their stupid investors that were too dumb to see how risky and predatory the loans the banks they invested in made – they deserve to lose the money, and they understood the risks with their investments. Boo hoo – go away! If you can’t handle the ups and downs in capitalism, and how stupidity ideally goes unrewarded or even punished in free markets, then don’t play the game. (and yes, even investors like pension funds who lose – if pension funds want to play in the free market, then they have to bear responsibilty and the ups/downs in their investments).
I say to the Greeks keep your money you earn in your daily work in your own pockets. You’re being told lies and the politicians that took those loans on your behalf were conspiring with officials of the EU, ECB, and IMF because the politico/banking system was neurotically obsessed and psychotically pissed off that there’s actually some countries out there where people prefer not to chase the dystopia of ever-greater macro level ‘efficiency’ (read: work harder, make and keep less money), and to actually live their lives at some ease, in comfort, and keep their own money. The Greeks say, let Berlin, Toronto, and Dallas debt-slaves trudge their miserable lives daily, commuting 2 or more hours along ugly freeways, work 44 hours a week, 50 weeks a year, put up with miserable bosses, debt-dead co-workers and neighbours, all to come home and worry about the mortgage, the car payment, the insurance payment, the food costs, the gas costs, the property tax, and work, worry, pay, work, worry, pay…..
To Greece I say, be like Argentina and Iceland. Every single country that has submitted to austerity measures, especially IMF Structual Adjustment Programs, have faired horribly, where everyone suffers on a massive scale without any end, and net capital flows pour out of a country continuously, incessantly. Ireland has chosen to submit to the austerity route and, until they realize their mistake and rescind this decision, they are condemning an entire generation to poverty. Is that worth it, just to satisfy some far off investors/bankers who will do nothing for the Irish economy or people? It’s a demonstrated fact that default shall set you free, and all of you will win in the end. Just do the research yourselves on the history of these phenomena.
If the Greeks default, then hey, they got a great deal. They got the banks/investors’ money, and don’t have to give it back. Just like Donald Trump says…”It’s nothing personal, just business”. Someone wins, someone loses.

#78 Humpty Dumpty on 06.14.12 at 2:48 am

There is no bigger housing bubble than the one currently happening in Canadian real estate. Not only is the bubble raging it has far surpassed what the US housing bubble reached at its pinnacle.

Even the Yanks are starting to laugh….

#79 Canuck Abroad on 06.14.12 at 3:02 am

The American (from yesterday) – I’m curious… Is anyone going to address the $131 Billion Canada received last week from the U.S. Federal Reserve as a measure to “Improve access to financing and strengthen Canada’s financial system?”

Okay I will take a guess. Tin foil hat required. The US has been all over Canadian banks to provide information on US citizens who might owe taxes but aren’t reporting it. As you know if you are born in the US, or even if you were not born in the US but your father was, you are a US citizen and you are supposed to be filing US tax returns every year. I guess this would also apply if you have a US grandfather, since his son would also be a US citizen, etc. So long story short there are all kinds of Canadians out there not filing US tax returns that the IRS is very interested in. Some may not even realise they are American. Non-filing incurs all kinds of ugly penalties (like 10k size or more).

Canadian banks have been pushing back hard on the grounds that keeping track of every American here would be way too costly. So my theory, and the reason to keep this so quiet, is that the funds are to be used to upgrade the banks’ systems so they can track who is American so that the Americans can force them to file tax returns and pay stiff penalties.

Just a theory. Okay to remove tinfoil hat now.

#80 groovin_123 on 06.14.12 at 3:14 am

I own a shoebox in Port Moody, BC – just outside of Vancouver.

Its an old townhouse, worth $320K – maybe.

I’m 33. No mortgage, $600K+ portfolio (even now) – I have daytraded for a living for 6 years now. I drive a 1996 Mustang with a million miles on it. I owe nobody, anything, and yes that includes the wife. No kids. I tour the planet at least once a year. I covet gold, bunkers, baked beans. I have a degree in Economics, but that never got me anywhere. Or did it? I even bartend at the local pub a couple days a week for chits and giggles.

My first trade was throwing my entire $12K savings into some penny stock in 2006.

Stay liquid my friends. Stay the eff outta debt. Please. This aint gonna end well.

#81 Canuck Abroad on 06.14.12 at 3:17 am

Great post Garth, fascinating. Did not know anything about Winnipeg before today. Surely the mass of immigrants arriving at Winnipeg airport can work out pretty quickly that there are cheaper places in Canada to live? Why not just hop on a bus and head east or west? Also, why have no major residential apartment companies constructed a few apartment buildings here? Seems like they could keep them full year round no problem.

#82 Buy? Curious? on 06.14.12 at 3:23 am

Garth, while I was sitting here in my Burger King paper crown, shooting imaginary lasers from my fingertips at the ceiling, I was laughing at the thought of all these people deciding to rent now. Rents are going up due to demand and the landlords are cashing in. Like Smoking Man goes on about, people are stupid because of the lack of proper education. I’ll give an example. A neighbour was frantically knocking on my door looking for a plumber. At first I thought she was trying to fulfill a porn fantasy but she really did have a plumbing problem. She’s a lawyer and I’m lazy so we were stumped. By the time the plumber arrived, she was ankle deep in water. The point being that with all her education, she couldn’t do anything.

#83 Canuck Abroad on 06.14.12 at 3:34 am

Carlyle didn’t you just dig yourself out of a hole? Why so keen to jump into another? Hang up some family photos and add a few bits and bobs to turn that rental into a home and enjoy it for a few years while you watch the fireworks.

#84 Finally on 06.14.12 at 3:51 am

Winnepeg, the armpits of Canada.

#85 Winnipegson on 06.14.12 at 5:50 am

Hello Mr. Turner,

The article is insightful but I’m not sure I can glean what might be the best course of action for my father who owns a number of properties with about 20 “doors” that are currently rented in Winnipeg. He’s doing well enough without my counsel but I’m curious if that given most of his net worth is in these properties and he has no desire to pay capital gains on their sale, is there are strong argument to be made to sell them right now?

Thank you

#86 John on 06.14.12 at 6:46 am

“It’s hard to overestimate the lack of rental housing.”

This is not market analysis for the Winnipeg area. In fact, I’d go a little further. It’s absurd, and to believe it was a significant factor in a 300% increase ( in some cases)? It’s not that you can’t be serious, you must be choosing not to be.

My father was born in the Stony Mountain jail, 6 kilometers outside the city limits. And his Dad left Winnipeg in 1925 to go BACK to Ireland after 15 years in Canada. He was a guy in his mid-40’s with an infant. That tells you all you need to know about Winnipeg.

Oh that lack of rental housing. I’ll STICK IT OUT and pay the “extra housing costs it produced”. Was there a Stony Mountain expansion my friend? Is the whole city a closed economy with no options beyond the guarded walls?

NO. People underestimate what Goldman Sachs et al glucose is. And went for it. Just like the rest of Canada. Rental challenges? Yes…you’re right…and you did paint a local story.

There’s a problem. You’re supposed scope is the Canadian housing bubble and regional analysis. You have not discussed this in your Winnipeg article. That’s now beyond opinion. If I’m missing something, maybe someone can help out and fill in the blanks.

Maybe some comedy comments about the Federal Reserve “hoax” to clear the board and start over.

#87 House Horny Housewife on 06.14.12 at 7:11 am

This sounds like a horrible situation.

If these people are young and mobile, why the heck don’t they just go elsewhere ?

And who cares about pressure from others ? These guys should do what they know is right for them and not what others think is right.

Whenever people try to pressure me into doing something or think they know what I “should” do, I get extremely annoyed but I politely tell them, “thanks for your advice” and then do what I want (after all, they mean well). What age do we live in when people are “pressured” into situations they don’t want to get into? This is crazy.

And since when do employers ask if you own your home or if you rent ? What the hell business is it of theirs anyway ? This is a new one in my book.

The way you describe it, Garth, these kids have choices:

a. go into debt up to your ears and lose your mobility
b. rent a place, carry a gun and take up karate
c. look for a job elsewhere and move the heck out

I moved away from Toronto in 1989 and I have NEVER regretted it. On the contrary, I thank heaven I did what I did … despite what others (including my own family) thought I should do at the time.


#88 GarthVader on 06.14.12 at 7:22 am

Interesting read… I knew HGTV “House Hunders” was fake.

#89 pbrasseur on 06.14.12 at 7:26 am

I’ve been to Winnipeg a couple of time, a city with no highways surrounded by gazillions of acres of land.

This makes absolutely no sense…

#90 Onemorething on 06.14.12 at 7:40 am

A decade ago in Winterpeg!

That’s where prices are heading!

#91 Aussie Roy on 06.14.12 at 8:01 am

Aussie Headlines

Houston, we have a problem, deleveraging.

Victoria is the prime example. Its economy is based around three industries that are under simultaneous pressure. The biggest is property. Second is manufacturing and third is finance.

According to the DSE, the annual number of Victorian home transfers fell slightly over the month – from 172,706 in April 2012 to 172,524 in May – which is the lowest level reached in the series’ history and 12 per cent below average levels.

The DSE’s mortgage finance statistics are unique in that they provide data on both mortgage lodgements (i.e. new mortgages) and mortgage discharges (i.e. mortgages repaid in-full). Below is a chart showing both series on a rolling 12-month basis:

According to the DSE, the annual number of mortgages discharged (192,534) actually exceeded the number of mortgage lodgements (191,602), meaning that 932 mortgages were lost in the state of Victoria in the 12 months to May.

To give you some perspective, this compares with the average of about 13,700 annual net mortgage creations since the series began in 2002:

Between 2003 and 2005, there were around 11 mortgages created for every 10 mortgages discharged. In the 12 months to May 2012, however, the number of mortgages lodged has slipped just below the number of mortgages discharged, signalling that Victorians are deleveraging.

#92 Pragmatic Pegger on 06.14.12 at 8:15 am

Its interesting how brave people are with their online persona. It reminds me of highschool.

#93 Gmaz on 06.14.12 at 8:28 am

Can it be?
I meant the past few weeks up to AND including this mornings ToSold report, MOST homes sold for full asking price or above. Both imply to me multiple offers.

How can this still be going on and for how long?

#94 Renting in Regina on 06.14.12 at 8:31 am

#49 Sask Girl and #72MP

I moved to (and stayed) in Regina, in great part, because it was cheap to live here. Prices sky-rocketed and the vacancy rate plummeted. The speed of that change is jarring. Regina is a lot like Winnipeg, but smaller. There is not a lot of bang for the real estate buck. So what are the options? Wait it out? Move? Move where?

#95 Tony on 06.14.12 at 8:46 am

I think the late Davey Boy Smith of WWF fame said it best about Winnipeg. “That 50 degree below zero hellhole”.

#96 Gotthardbahn on 06.14.12 at 8:54 am

‘Some see it as a frozen, flat, windswept period piece, a grimy anachronism from the railway age, with man-eating bugs and the worst climate of any major Canadian city.’

I have yet to see a better description of Winnipeg.

Years ago I passed through westbound on the Super Continental and spent an hour in the city, waiting while the engines were changed and the diner re-stocked. Back then it was just grim. Now it’s grim with overpriced housing.

#97 Steven Rowlandson on 06.14.12 at 8:59 am

Real estate is a cult that persuades its members that each house great and small is a ticket to a capital gains tax free profit. Nothing matters but the tax free profit and all excesses and means are justified to get that profit. Say the words real estate and people get dollar signs before their eyes. At real estate investment seminars they hang on every word spoken by the lecturer as if every word was a divine utterance from god himself. People have drunk the proverbial kool aid.
Some times there is nothing people won’t believe or do for a tax free profit in currencies backed by a promise to pay nothing but more unbacked paper.
This will not end well at all Garth.

#98 timbo on 06.14.12 at 9:00 am

“More Americans sought unemployment aid last week, suggesting hiring remains sluggish.

The Labor Department says weekly unemployment benefit applications rose 6,000 to a seasonally adjusted 386,000. The four-week average, a less volatile measure, rose for the third straight week to 382,000, the highest in six weeks.”

A recovery to remember………

“On Thursday, Italy’s benchmark 10-year yields rose to 6.3 percent, the highest since January, while Spain’s hit the 7 percent level at which other euro zone states were forced to seek support for their national finances.

“The Spanish ‘bail-out’ was a game-changer. It’s putting Italy under extreme pressure because of the lack of differentiation in the markets,” said Nicholas Spiro, Managing Director at Spiro Sovereign Strategy. “There’s a sense among investors that Italy is the next domino to fall in the absence of bold and decisive euro zone-wide measures to stem the panic.”

Bail out the banks to pay the bondholders. Now rinse and repeat with higher rates. What could possibly go wrong?……………

#99 fancy_pants on 06.14.12 at 9:01 am

4 seasons to enjoy in winnipeg: winter, flooding, mosquitos, winter

and looks like this season will be extra memorable:

#84 Finally on 06.14.12 at 3:51 am
…and here I thought it was the groin of Canada being so close to the bread basket

#100 Trebeck on 06.14.12 at 9:13 am

I’m surprised that there are so many negative stereotypes about Winnipeg across Canada. Yes, we were/are the murder capital of Canada, but keep in mind that that’s on a per capita basis, and a good portion of them are gang related. Yes it gets really cold in Winnipeg, but I actually enjoy the variety of weather (you can go skating or on a snowmobile during the winter and go to the lake in the summer). Heck, kids like playing in the snow. In addition, you do get used to the cold. When the weather goes down to -5 degrees in the fall, you wear your parka. When it goes to -5 degrees in the spring, you just wear a sweater. Yes, there are some bad neighborhoods, but most cities do. Heck, I remember being in downtown Vancouver a few years ago and the bums seemed more drug addicted and aggressive than Winnipeg.

Anywho, as for housing, there are a lot of great neighborhoods. Some neighborhoods are pretty expensive (not everyone can live in River Heights, it’s one of the most desirable locations hence houses cost more). I’m sure most of the blog dogs (as well as myself initially) are looking at houses in the 200 to 300k range. The houses that go for that price range are insane and so frustrating as a buyer since it’s in this price range that you get bidding wars which raise prices by 30 to 60k. With this, you have 1000sqft bungalows, sometimes dated and without a garage selling for 280-320k. Plus, every seller is expecting a bidding war. I’ve seen houses listed for 270k and on the offer date they only received 1 offer at the asking price. The seller rejected the offer and raised the price to 295k (and it later sold for 291k). I’ve seen this happen to at least 5 houses recently.

But don’t be too discouraged. If you’re able to afford it (20% DP, mortgage at 3 times your salary), there are many houses which you can buy in the 350-400 range where you don’t get bidding wars and can get a home inspection. You get a lot more bang for your buck, and since some of those houses are sitting on the market, you can find some motivated sellers and low ball them. Yes, I just recently bought a house where the seller reduced the price and I knew she was motivated (had to sell within 1 week or she’d lose her deposit on a condo). Offered below asking, got a home inspection to reduce the risk and now I have a 2000sqft house for just under 350k compared to some 1000sqft houses that I didn’t get due to bidding wars which sold for 310k. Honestly, 350k seems to be the price point where a lot of people can’t afford it, which means less competition if you can afford it.

Anyways, I wouldn’t be surprised if prices go down in the next few years, but really, if you’re looking for a house in Winnipeg, at least keep an eye out and you might just find an ok deal. The lack of apartments is crazy though (I needed to sublet my apartment in 4 weeks and I couldn’t believe how many people were looking to move in an apartment in less than a month).

#101 timbo on 06.14.12 at 9:27 am

a rant to remember……

“open borders and free trade — is about to go down in the flames of a misplaced decades-long infatuation by the EU governing authorities with a single currency and its banker creators.”

Damn housing bubbles can bring a system to a cliff………

#102 JIM from Calgary on 06.14.12 at 9:29 am

Interesting point. There are more renters than rental units in Winnipeg. So by classic laws of supply and demand. rents will go up. Therefore in the microcosm that is Winnipeg, housing prices will also go up. We have seen this all across Canada, especially in areas of the country (like Ontario) where draconian rent controls meant no new rental units being built.

#103 AokakesuDigital on 06.14.12 at 9:50 am

Wow. The Winnipeg summary pretty much covers all of my observations about the Greater Sudbury Area.

Affordable homes only in neighbourhoods where your family would be in jeopardy? Check.

New builds of questionable quality starting at 400kCAD? Check.

Rental vacancies at 1%, driving rental costs to mortgage levels? Check.

Blackflies and mosquitoes? Well, they should be up and munching now, but are strangely depopulated.

#104 cramar on 06.14.12 at 9:53 am

#35 Stupesing in Cabbagetown on 06.13.12 at 10:51 pm
#14 theworstone – regarding your photographic project, did you see this one of Detroit?

Wow! That is enlightening! Thanks for the link. What got me was the derelict library shots with books still there on the shelves. When a society puts no value in books then it is doomed. Now I like Detroit even less.

#105 disciple on 06.14.12 at 9:54 am

Hi Nostradamus – Thanks! Mona B.’s dreamy voice talking about the Big Bang was distracting, but I’ll definitely try again later to understand what the heck she was talking about…LOL.

#106 cramar on 06.14.12 at 10:02 am

#80 groovin_123 on 06.14.12 at 3:14 am
I own a shoebox in Port Moody, BC – just outside of Vancouver.

Its an old townhouse, worth $320K – maybe.

I’m 33. No mortgage, $600K+ portfolio (even now) – I have daytraded for a living for 6 years now. I drive a 1996 Mustang with a million miles on it. I owe nobody, anything, and yes that includes the wife. No kids. I tour the planet at least once a year. I covet gold, bunkers, baked beans. I have a degree in Economics, but that never got me anywhere. Or did it? I even bartend at the local pub a couple days a week for chits and giggles.

My first trade was throwing my entire $12K savings into some penny stock in 2006.

Stay liquid my friends. Stay the eff outta debt. Please. This aint gonna end well.


Luv it! You da man! Wisdom for your generation: S-T-A-Y O-U-T-T-A D-E-B-T! REAL Smokin’ Man wisdom! LOL

#107 joe_blown_away_by_high_housing_costs on 06.14.12 at 10:03 am

I’ve been to Winnipeg twice in my life. Both times were stop overs on greyhound bus trips between Vancouver and Toronto.

On my first one hour stop over in Winnipeg, a native guy sold me a pack of contraban Du Maurier cigarettes–a 25 pack for something like $3. What a great deal! I bought them!

On my second one hour stop over, a group of us got off the bus and crossed the street to an empty field. We sat on the grass, in a cloud of mosquitoes, and smoked a joint. The marijuana impaired our sense of time and we ended up missing our bus headed to Vancouver. I had almost no money, I thought I was going to be stranded in Winnipeg for life. But we talked to greyhound and they called the bus driver and told him to meet us at a McDonalds on the side of the highway. We took a taxi to meet the bus there.

I wish I spent more time in Winnipeg because I lov e gritty cities. Coming from Vancouver, the old buildings of Winnipeg’s downtown remind me of Vancouver’s Downtown Eastside. Imagine if Vancouver’s downtown only consisted of the Downtown Eastside and there were no glitzy Robson Street, Burrard Street, west part of downtown. That’s what Winnipeg’s downtown reminded me of–a downtown entirely consisting of the Downtown Eastside with no nice parts.

#108 SKRenter on 06.14.12 at 10:07 am

I don’t know what the bitching is about, come to Skatch get that HELOC, buy an F350, strap some golden bull testies to your hitch and swallow the we are different attitude. Once you take this medicine, you will be in a state of perpetual price gains and we love Regina. Mountains you say…whatever, who needs them, they just block our mental waves from reaching their full potential. My buddy just walked to his car in downtown Regina and started getting acosted by 3 of Regina’s finest. They were so drunk anyways, he just pushed them down for a few minutes before they were too tired to get up. Tell me Canada, where else in Canada can you get that type of workout without a gym pass? Answer, nowhere, we are different, now suck it up, grab those testies, dust off that cowboy hat and come to the Skatch!!! Yeeeeehaaawwwwwww!!!!!!!!

#109 eaglebay - Parksville on 06.14.12 at 10:25 am

#7 Ed on 06.13.12 at 10:00 pm

The name “Nanaimo” is a contraction of the Indian word “Snanaimo” which means “Great People”. The sibilant sound was dropped by the early settlers; and the Indians, through their commercial dealings with them, finally acquired the same pronunciation.
These Indians were formerly five tribes, one of which lived at “Sclalup”, now called “Departure Bay” another at “Sweelum”, now known as “Nanaimo River”, and the other two tribes, both small tribes lived within a radius of four or five miles from Wenthuysen Inlet, where the fifth, the largest and principal tribe lived. These tribes each had a separate name but all speaking the same dialect. They finally united at Wenthuysen Inlet, now the city of Nanaimo, thus forming the “Great People” – hence the name.

#110 NAM not HAM on 06.14.12 at 10:39 am

Stan Wong had his words about REITs on BNN. He said that REITs have had a good run due to low interest rates. REITs will continue growth because rates will be low for the near future.


Will REITs still be a good investment later down the road when rates are higher?

#111 cramar on 06.14.12 at 10:39 am

In the late Spring a few years ago, my wife and I drove out to Regina to visit family. We passed by Peg with a couple of hours to spare. Never been there, let’s visit. We ended up at the Parliament building and took a tour. Wow! Really impressive building! I was blown away! The cavernous interior. The marble. The huge stairways. What I also remember is signing a guest book and having a uniform guide asking where we were from. When I replied, Ontario he said, “We will not hold it against you.”

When people have said that in the past they were mostly joking. What I detected was he was mostly serious. Huh! Are the inmates running the asylum?

We toured the surrounding lawns and walked to the river. Really impressive legislature building! Then we were on our way—never to return I hope. Winnipeg in winter is as attractive as Mars. I wouldn’t live there if you gave me a free house.

But then, it does have a really impressive Parliament building.

#112 Chris on 06.14.12 at 10:41 am

Rates, rates, rates.. They’re of overwhelming importance. Even a wannabe city like The Peg needs normal rates to slowdown its runaway housing.
Nobody disagrees that they’ll go up, but nobody can agree when they will. Till rates wake up, I’m afraid we’ll have little more than theories & predictions..

#113 jess on 06.14.12 at 10:43 am

sifi’s – too significant to fail

when branding your city as a “creative” fails

no demand?

…”Four years after Governor Deval Patrick signed a $1 billion initiative designed to boost the Massachusetts life sciences industry, the program has brought new companies and jobs to the state – but not as many jobs as originally anticipated. While the governor in January 2008 said the biomedical initiative could generate 250,000 jobs over 10 years, the economic slowdown has made it unlikely the real job gain will come close to that figure, with only an estimated 8,750 jobs created so…
During the financial crisis, at least 18 former and current directors from Federal Reserve Banks worked in banks and corporations that collectively received over $4 trillion in low-interest loans from the Federal Reserve.

#114 pessimist on 06.14.12 at 10:55 am

#85 Winnipegson on 06.14.12 at 5:50 am

Hello Mr. Turner,

The article is insightful but I’m not sure I can glean what might be the best course of action for my father who owns a number of properties with about 20 “doors” that are currently rented in Winnipeg. He’s doing well enough without my counsel but I’m curious if that given most of his net worth is in these properties and he has no desire to pay capital gains on their sale, is there are strong argument to be made to sell them right now?

Thank you

I’m not Garth, but I’ll give this one a shot.

With all due respect to your father, not wanting to sell an asset due to the fact that you would have to pay capital gains tax is about the stupidest reason there is to not sell it.

Capital gains tax is NOT going to go away. The only way to avoid paying it is to sell even or at a loss. That is a pretty poor alternative to just paying the tax. The more tax you pay, the more profit you made, the *happier* you should be, not angrier.

Perhaps he should diversify by selling some of these properties if the comprise too high a percentage of his net worth, say over 35% or so.

#115 T.O. Bubble Boy on 06.14.12 at 11:19 am

Here is where Toronto’s housing rental stock is going:

“Mostly Land Value. Home Being Sold ‘As Is’. This Brick Bungalow Is Currently Tenanted With Excellent Month To Month Tenant Who Is Willing To Stay!”

i.e. screw the tenant, I want my $1.25M for this dump!!!

#116 Silver on 06.14.12 at 11:25 am

Every sale of property in Vancouver in my classification has cost
me an extra $450-$500 dollars in “New Property Tax’s”.

Here is my solution to the shifting of the post sale costs of million dollar propertie’s tax’s through an obscure cost shifting averaging formula to long term residents with actual “Equity”.
SO… for every property that sells in my class
….I must now recover an extra $1,200.00 in costs,
… to cover the property tax , federal tax,and my profit increase each year.

each property sale is one week of employment for an employee that will not happen.

So far we are looking at 3 months of work lost by an employee….

… to cover the costs of someone else’s subsidized property tax’s…
on purchase’s of million dollar properties.

… this is happening in small business all up and down Commercial and Venable’s st. in vancouver.

It has become financial necesary to remove these costs to keep the bottom line cost above water….

Have fun guy’s here go the small business job’s…

One Sale At A Time…

And for Vancouver film job’s with a 40% tax Kickback to the productions cost’s…

here’s the future… direct from the source…

the L>A> money is sitting in Bank accounts because people there are afraid to commit to, and finance a big project right now…
there are some 10,000 jobs in the lower mainland directly based on this income… and some 5,000 or more high value properties dependent on this work for their mortgage payments.

this is an extremely market leveraged group of people
most… even with $10,000.00 a month or more in earnings can’t last a month without a job…. no cash flow….

have a nice day


#117 Not 1st on 06.14.12 at 11:35 am

Garth, do you still maintain that Europe’s problems are contained, as you cited in your blog last fall?

More like just beginning I think;

Do you own Spanish bonds? Then relax. – Garth

#118 joe on 06.14.12 at 11:35 am

Winnipeg might possibly be the crapiest place on earth (in the 1st world). How anyone can justify paying anything over $100K for a house there is beyond me. My city Calgary is not too far behind on the list of crapiest places to live.

#119 Beach Girl on 06.14.12 at 11:40 am

Winnipeg sucks, actually had to live in that rat hole, entertaining drunks on an airplane. Yes, I was a stewardess. Surprised, I am not gay. That town is diddley squat and always will be. The rest of the West sucks too. They know it, inferiority complex well deserved. The hat is only large thing you are carrying buddy and not to this party.

If you can’t make it in our version of the Big Smoke, you are a loser.

I understand the laid back lifestyle everyone envisions of pot relaxed boomers, zoomers, Bull Shit artists, tattoo freaks. They are none of the above.

#120 Can it be? on 06.14.12 at 11:45 am

#93… I know people who lowered their prices, so if they sold at the reduced price… at full asking… it’s deceiving. Offer what you want to pay. Don’t get sucked into multiple offers. Don’t believe the hype. I’ve spoken to my neighbours, although people are not panicking yet, they will when they are carrying two homes in a short time. I no longer trust any realtor reports. I’m not saying the market is tanking.. but people are accepting less for their homes if they have to move. The general feeling is that the market is changing… who knows for sure. I was looking at a lakefront property in Port Credit today… listed too high in my opinion… but it will probably sell over asking. I’d be curious what happens after the weekend. 63 Oakwood if anyone is interested.W2390463. If it sells over asking… it’s not profitable for a reno or a flip IMHO.. but you never know now a days. Certain neighbourhoods are a little wild.

#121 bill on 06.14.12 at 12:15 pm

ah ! Winnipeg…..

one summer ,many years ago,myself and two friends were on our way across Canada.
one night ,under the lash of hunger ,we found ourselves in the aforementioned city.
pulling into a gas station, we struck up a conversation with the attendant, and ascertained that a taproom was close at hand .indeed just down the block at the corner of portage and main.proceeding to this establishment , we couldnt help but notice that the surrounding neighborhood was strongly reminiscent of the downtown east side of vancouver. street people in darkened doorways huffed on lacquer thinner and eyed us with suspicion. wandering bands of impaired aboriginals solicited us for money or insisted on showing us card tricks.
eventually we found the bar and went inside.
here they played both kinds of music apparently, country and western. I had never been in a tavern that had balconies. 4 or 5 as i recollect.
with commendable initiative and foresight the management had ,in an effort to prevent bottles and other debris from landing on the patrons below,strung chicken wire in a strategic fashion.
while this obscured the view of the band, it was just as well.listening to these artists perform the old standards was a test is all I will say.
my predominate memory of this performance was steel guitars weeping continually and the singer ululating about some lost dog or truck. or it may have been his best girl or heifer. the nights events faded into a bit of an achohol haze to be honest.
As our fellow patrons were starting to eye us with ill concealed dislike we thought it best to call it a night and proceeded into the dank mosquito filled air in search of some Chinese food. we found this establishment just a block or so away from the gas station and filled ourselves with the worst Chinese food I have ever had. [worse even than the restaurant in bella coola]
A subsequent visit a few years later showed that this establishment had been torn down and an office building [?] stood in its place. Good move I thought.
does any native pegger know the name of that bar?
Thanks in advance
on our return trip we eschewed the core and parked our van in a lovely middle class neighborhood beside a large park. much better.
my feelings were and still are a bit mixed. the nice parts were quite decent . the bad part of town was definitely on par with any wretched part of town that I have struck on my travels through Canada.

#122 jess on 06.14.12 at 12:19 pm

115 T.O. Bubble Boy

there will be plenty of public housing when the underwater condos revert back to apartment reits and need tenants

#123 TonyMontoya on 06.14.12 at 12:24 pm

Wake up Canada this is coming to a street near you in the very near future:

#124 Jim on 06.14.12 at 12:47 pm

This does not sound like a city that I would want to live in. I’d be pretty pissed if I were First Nations, as well. Your people finally start regaining ground in terms of birthrates and population growth, and then the government begins to flood in immigrants with even higher birthrates (north africa, etc). It’s like they want to keep the First Nations marginalized. I can only imagine the gang activity in Winnipeg in 10 years when the blacks and First Nations start going at it for control of the various illicit goods trades. No thanks.

#125 from kits on 06.14.12 at 12:48 pm

4 times is close to the average mean? while expensive to those who have lived there for years, still not too bad for affordability

#126 Bittersweet on 06.14.12 at 1:08 pm

Yeah, so many bitter people here. I have no doubt that the outcome of this real estate bubble burst will bite most peoples behinds. But why cheer to it. I think the most people here (including Garth) cannot get over the missed opportunity to make big on real estate. These people missed the train, and the train is not coming again soon. And this is the reason for all comments welcoming crash. Vendetta.
People, you must realize that the only big winners are large financial corporations and the government. The financial corporations take real earnings from mortgagees for lending money they created from thin air. And the government is also ripping us all with printing money and inflation. Nowhere to hide if you are prudent and saved a little. Yes, I’m bitter too.
Yeah, preferred shares are the solution!!!!!

You have a bad attitude. ‘Making big on real estate’ is exactly the mindset which creates bubbles, inflates homes, destroys affordability and leads to inevitable busts. Be bitter all you want. — Garth

#127 Snowboid on 06.14.12 at 1:08 pm

#109 eaglebay – Parksville on 06.14.12 at 10:25 am…

While you may be a great historian, the accepted practice is to cite your source (word for word I might add):

Chief Louis Good as quoted in the Nanaimo Free Press, March 4th, 1907

#128 T.O. Bubble Boy on 06.14.12 at 1:20 pm

Canadian House Porn apparently makes for good TV Ratings / Advertising Dollars:

#129 Toronto_CA on 06.14.12 at 1:23 pm

Bank of Canada gives strongest warnings yet on the Toronto Condo Market.

Would anyone buy one right now at full asking price with the entire world and MSM shouting “this is going to crash very soon”?

“Adjusted for population levels, multiples under construction in major metropolitan areas, especially Toronto, are above historical highs,” they said. “If these units are not absorbed by demand as they are completed over the next 18 to 36 months, the demand-supply imbalance will become more pronounced. Since strong investor demand has spurred levels of construction that are above demographic-based demand, this market will be susceptible to changes in buyer sentiment.”

#130 Observor on 06.14.12 at 1:25 pm

114 Pessimist responding to 85 winnipegson

Pessimist said Capital gains tax is NOT going to go away and that therefore avoiding selling an asset just on to avoid capital gains tax was stupid.


There is however a HUGE benefit to deferring taxes for amany years

Imagine $10,000 invested for 40 years at a return of 10% capital gain per year.

If capital gains tax of 20% is paid annually the after tax return is 8%. After 40 years we have $217,245. ($10,000 time 1.08 to the power 40)

If capital gains taxes are deffered until the end then the $10,000 grows to $452,592 or after 20% tax $362,074.

So our value is 67% higher when we simply defer the tax.

The value of tax defferral jumps dramatically with higher tax rates and especially with higher returns.

So deferring taxes is a legitimate matter to consider here, though far from the only consideration. The dad here is wise.

Tax defferral is why RRSP is so incredibaly powerful. It can be used to defer taxes for decades.

In fact though it is a whole ‘nother argument, the taxes you pay on an RRSP withdrawal are EXACTLY equal to the value of your original tax deduction compounded up at the return rate of your RRSP (assuming tax rates unchanged) and you pay zero taxes on your share of the RRSP and the growth in your share. Your share being the RRSP contribution less your tax refund. Your RRSP withdrwal so-called tax is merely the return of your RRSP tax refund with an interest equal to the return rate you made.

#131 new_era on 06.14.12 at 1:26 pm

F&C are ducking and hiding

So blame it on Europe. Its was always a given that this would happen.

But that politics. (I guess they are washing their hand clean of the mess they have created) and have continued to encourage.

#132 Smoking Man on 06.14.12 at 1:31 pm

This morning carney came out with fire and brimstone. Europe is going to take us down bla bla bla bla

Translation. The msm The Boc and F with there real eastate retoric have done nothing to quench the fire in the GTA.

As we watch Europe un ravel and put on our shorts C knows a rate cut in the prime is a comming. C reminds of me. When a goes into my wallet and lifts a 20 never any conciquense. The 6ers don’t beilive him anymore

#133 Toronto_CA on 06.14.12 at 1:39 pm

So this is how it will go, eh? Europe will send the world into a Global Recession which could be as bad as the GFC of 2008. This will set off layoffs in Canada and suddenly house prices will collapse like a house of cards at the same time, and everyone will say “wow that Europe, they ruined Canada”.

It’s depressing and the writing is on the wall. I don’t know how anyone could be a RE Bear right now given what is happening. Greece goes to the polls on Sunday right?

#134 Snowboid on 06.14.12 at 1:40 pm

#121 bill on 06.14.12 at 12:15 pm…

“…in an effort to prevent bottles and other debris from landing on the patrons below, strung chicken wire in a strategic fashion…”

This was (and may still be) a common practice at many C&W bars throughout the west in the 1970s and 1980s – to protect the band.

Some places, such as the Williams Lake stampede open air dance hall, were notorious for the injuries (sometimes fatal) sustained by patrons from flying beer bottles and broken glass. The band remained safe, protected by their ‘cage’.

Those were the days!

#135 edmonton mortgage broker on 06.14.12 at 1:46 pm

How considerate of CMHC and Genworth. see details on the Divorce financing programs below…..

Do you have clients looking for a refinance due to Marital Split and 85% LTV refi is just not enough to payout ex spouse?

RMG has a solution for you to obtain up to 95% LTV financing for these situations through both CMHC & Genworth. Details as follows —

On an exception basis, both CMHC and Genworth have been considering Marital split payouts up to 95% LTV .
The deal is still packaged as a Purchase; however it is one that purchases the other spouse off title.
Clients are no longer restricted to 85% LTV of the equity in their property.
This allows for greater payouts and/or debt consolidation to help facilitate the separation.
We will consider these transactions “but” only under special circumstance of a “Marital Split”…..

#136 Doug in London on 06.14.12 at 1:49 pm

I think Alicia’s comments sum it all up quite well. When I was in my twenties (back in the ancient 1980’s), there wasn’t this pressure to hurry up and get a house. Nor was there any negative stigma if you were a tenant. We believed in a highly abstract concept most people don’t get now, likely a product of the time of horse drawn wagons and steam locomotives, called saving up for a good down payment first. It’s one of many tell tale signs of a bubble, when it’s perceived there’s something wrong with you if you haven’t blindly jumped on the band wagon. I’m glad I haven’t bought an overpriced house in Windypeg, or any other overpriced city for that matter.

#137 Can it be? on 06.14.12 at 2:03 pm

@bittersweet… While they may be some who wish they made money.. For the rest off is who have been home owners for over 10 years… And I mean owners not in debt, with paid for homes… You missing the point. I have no interest in my property taxes going up etc. I’m content to stay where I am and use money for other things. I don’t care that my property doubled in value… But I do care that I have $3000 less dollars that now goes to property tax payments. This type of future is unsustainable. I’d like to know that I can retire someday and sustain this life.. Some profit on increasing house prices, but government gains the most. Just can’t teach everyone common sense I guess. Keep up the good work Garth.

#138 From Winnipeg... on 06.14.12 at 3:01 pm

Thanks today’s blog, Garth, but I wonder if this statement is correct:

“…A commodity-based economy in a world of slowing growth and runaway volatility is an uncertain foundation…”

Is Winnipeg a commodity-based economy? I sincerely doubt it. And that is why I question if it really IS different here.

I would characterize it more as a socialist economy. Here the ‘good’ jobs are based on tax dollars: direct employees of the provincial government; Provincial Crown corporations like Manitoba Hydro or Manitoba Public Insurance; unionized employees in industries ultimately backed by tax dollars like health and education.

Notice I didn’t list Federal Government employees as jobs have been lost due to austerity measures. I can’t see “Today’s NDP” taking any austerity measures in MB. As long as Ottawa keeps the transfer payments flowing…

So I would like to see you address the socialist aspect.

(Off to buy ‘Money Road’ now…)

#139 Observor on 06.14.12 at 3:24 pm


That you don’t know that property taxes rise with the revenue requirement of your City.

If house prices doubled in a year the property tax would still only ris by the standard 4% or whatever.

Property tax is actually the most honest tax around because when they say a 4% increase actual rate per assesed dollar may actually change 0% if assesed values are up 4%.

Rising house prices only cause your property to tax to rise if your house rises more in price than the average for your City.

Do you really think property taxes will go down if house prices crash by 50%. No, they remain stable and in order to accomplish that the mill rate ber dollar of assesed value would double.

#140 Vanman on 06.14.12 at 3:28 pm

Hi Garth,

Why not discuss the reason rental properties are not being built in Manitoba – ooppressive rental restrictions? Without any rental stock being bulit for a few decades, people who want to rent just can’t find anything. And existing multi-family landlords aren’t going to invest any money making the existing housing stock attractive, since their returns are zero.

Having the government change those laws might go a long way towards some new rental-specific housing projects being started, or existing stock being made live-able.

#141 bill on 06.14.12 at 3:37 pm

I can safely say it was one tough dump.
been in a couple so I speak with some little experience..

#142 Surrey Girl on 06.14.12 at 3:43 pm

#73 Suede
Electric cars do not take 7 years to break even even at today’s gas prices.

#143 jess on 06.14.12 at 3:51 pm

stand your ground

NRA Offers ‘Stand Your Ground’ Insurance To Cover Legal Costs Of Shooting People In Self-Defense

Mitt Romney’s presidential campaign isn’t backing off the candidate’s claim that America needs fewer teachers, firefighters, and police officers. Instead, former New Hampshire Gov. John Sununu (R), a top Romney campaign surrogate, backed Romney’s call this morning, telling MSNBC that changes in technology and population shifts have made layoffs of teachers and public safety officials necessary
Q Sensors

Biosensors to monitor U.S. students’ attentiveness – Yahoo!… – United StatesYou +1’d this publicly. Undo
1 day ago – Biometric devices wrapped around the wrists of students would … A biometric bracelet named “Q Sensor” is shown in this undated image …

leg bracelets for the white collared criminals

#144 Bill Gable on 06.14.12 at 3:54 pm

I am always on high alert for anecdotal evidence that damp ole Vancouver is starting to slide. Today a stark reminder of just HOW bad it “could be” getting.

London Drugs, on Davie Street, in the West End has been a goldmine for the Louie Family since it opened, fifteen years ago.

I started noticing that it was “quieter” in the last two months, or so.

Today, I asked my favourite cashier what her take was.

“It’s dead”, she said. “No one is buying anything except the basics”.

Hmmm. I went into the Computer department – flies.

The TV and geegaw department – nary a soul.

If this is a hint about of how strapped people are, (and I think it’s a very good indicator), now I know why I have been noticing a new forest of “For Lease” and “For Rent” signs, in retail areas of the west side.

I have a feeling that we starting to see a massive deflationary tsunami, just offshore, and if you haven’t been following Mr. Turner’s astute calls on what to do to protect you and your Family – I suggest heading to higher ground, now.

Get rid of debt. That of course has a downside, a death spiral, as people stop buying, then it affects the take, taxes, et al.

In a word.

Jimmy Carter-itis.

#145 Mark W on 06.14.12 at 3:58 pm

Winnipeg on the high note:

Winnipeg on the low note:

Fast forward to the year 2025.

All these baby boomers born from 1947 to 1954 are retired and want to downsize their Winnipeg large suburbia homes (with massive property taxes).

A city with almost ZERO demographic growth.

Question: Who are they going to sell them too??

#146 Canadian Watchdog on 06.14.12 at 3:58 pm

Mark Carney preparing for Operation Twist 2

#147 Not 1st on 06.14.12 at 4:14 pm

Do you own Spanish bonds? Then relax. – Garth

Garth, you need to extend your logic to see the entire picture.

1. The U.S.A is our biggest trading partner and Europe is a recent signatory to a new free trade agreement with us. China is a major consumer of our raw resources.

2. The U.S. fed and soon ECB/ESFS is busy buying up foreign bond debt to support the Euro.

3. Future bailouts are on tap for Spain, Italy and then Ireland and Portugal. Greece leaves Euro and defaults on $400 billion in debt repayments and ECB gets stuck with it. 3rd tier countries like Hungary are up next to the trough. Trillions in new debt will be issued to prop this thing.

4. All those actions increase the indebtedness of those residents and will eventually lead to austerity one way or another when growth cannot outpace debt servicing. Simple math, irrefutable.

5. Then U.S. and Europe stop buying finished chinese goods, china stops buying Canadian resources and the crash is world wide at that point.

We are so intertwined that something like high yields on Spanish bonds tips a domino that cannot be stopped.

6. Stop thinking you are smarter than the world’s central bankers. You aren’t. — Garth

#148 Alexa Torelli on 06.14.12 at 4:16 pm

U should think these kinda things god loves u and wil forsure keep u safe belive in him! Trust in the lord with all ur heart lean not ur own understandings on all ur ways ignoledge him and he will make ur pathhhh straightProverbs3:5-6:) hope to see u on heaven someday:D bye now.

Bye forever. — Garth

#149 daystar on 06.14.12 at 4:23 pm

#126 Bittersweet on 06.14.12 at 1:08 pm

There’s a bit of that but to generalize like you just did is so off. There’s a big reason why this site has been talking down housing in Canada for several years now (Calgary as an example peaked in 08′, bubble phenomena has been alive and well in Canada for 6 years, ever since Harper was elected back in 06′).

Most who buy into the highly inflated prices of markets that have soared taking on huge mortgages are either walking into a nightmare or are already there. This site does the service of educating specifically so that the buyers of today don’t share the same fate buying into lofty prices!

The numbers that have taken on large mortgages have generated what cannot be an understated large systemic risk. The reason why most here toil at this is not vendetta. Its called prevention. Damage control. In short, education and when its done as a group that doesn’t infight and backbite, it can be highly effective. If you had any sense you would quit doubting motive and become an interactive player yourself or taste the lash of your own judgment of which, by the way, is as transparent as glass. Quick question. What did you hope to accomplish running down those who comment on this site, self inflation, did you get what you came for?

#100 Trebeck on 06.14.12 at 9:13 am

If you go by capita murder rates in Winnepeg:

Winnepeg is an uncomfortable 1st place over the last decade and especially as of late. Looking at non per capita rates and actual murders, Winnepeg had 32 murders last year. T.O. had 37. Winnepeg is in 2nd place this year and could end up #1 in the number of homicides with capita removed from the equation. Thats excessive.

2006 crime stats tell a story. Criminals either get caught more in the west or the environments out west breed crime… or both but its deeper than this. The percentage of natives behind bars suggest racism in the system but the result from our penal systems is gangs and wasted youth and the far greater underlying reasons are poverty, drugs & alchohol and lack of education leading to or caused by high unemployment and when we have generation after generation of these environments it becomes systemic.

Its an awkward dialogue at the best of times but one that is long overdue for Canada and if our federal government really truly cared about “sustainable” RE valuations in cities like Winnipeg (or reserves, think about that), they would spend less money on jails and more energy and resources on social programs that support native health, education and spirituality particularly through women followed quickly with job creation.[email protected]?iid=36

I get that the Peg is not all bad, there are gems everywhere in Canada, we just have to look for them but thats just it, we have to look. There’s big room for improvement here and I seriously don’t see much in the way of political will to do so, at least federally especially with first nations.

#150 NAM not HAM on 06.14.12 at 4:26 pm

You have a bad attitude. ‘Making big on real estate’ is exactly the mindset which creates bubbles, inflates homes, destroys affordability and leads to inevitable busts. Be bitter all you want. — Garth

Well if I wasn’t so bearish like everyone else in 2007, I would of hopped on the train and flip till now. Know I’m struggling to make money because my job is commission based and there’s little work for me. I snoozed, so I lose. Now the world is hopped and I can’t get by. My have 2 young kids and I pray every night that I can bring home some food. It’s tough, coming out of 2008. Home prices going crazy and this blog got me thinking too early. If this crash was going to happen anyways, at least I could of gotten a piece of the pie to protect my children.

#151 KingBubbles on 06.14.12 at 4:39 pm


Any feel for how Winnipeg might fare if/when the bubble bursts?

#152 greed on 06.14.12 at 4:54 pm

You have a bad attitude. ‘Making big on real estate’ is exactly the mindset which creates bubbles, inflates homes, destroys affordability and leads to inevitable busts. Be bitter all you want. — Garth

There it is again. Telling people it is bad to make money on RE.
It is ok to advise them to all buy preferred shares with dividends as that wont drive the price of them up eh?

Shelter is a social issue. Dividend-yielding portfolios are not. Buzz off. — Garth

#153 SG-Astroboy on 06.14.12 at 4:55 pm

Dear Mr Turner,

Thank you for your commitment to educating the public about the dangers of speculation, and humorous posts. I have been silently reading your posts for a while now, to understand the Vancouver market and the Canadian mind as I’ll be moving over to Vancouver in a few months.

I live in Singapore and we’ve had a similar credit and housing bubble as a result of Fed policies. Our central bank has an outdated managed float strategy for our exchange rate, which means we import our interest rates, which Ben made zero. In fact, there was a period last year when our rates actually went negative. The result: Young horny couples making less than 50k a year have been buying million dollar condos, and buying 250k cars. They also have 7-10 credit cards each; stanchart has giving away $100 to everyone who signs up for one. Sales have slowed significantly, however. The core downtown region had virtually no sales in the 1Q, and asking prices are down 10%. Only periphery sales are happening now as the mass market participates in the last hurrah. Very late stage in the bubble. And yes the HCM has stopped coming to Singapore as well.

The last time I saw this credit hubris was when I was in the US for studies from 2002-2007. I left College with 6 credit cards as a student, with a 30k credit line from Amex alone. My income was about 5k per year. I never used them as I just wanted the freebies. Later I worked for Lehman Brothers in 2007 and well that lasted less than a year but what a real education! I saw many ‘good’ hardworking Americans lose all their ‘wealth’ in 3 months. Firstly, they had a significant portion of their wealth in their company stock (Lehman encouraged and boasted about employee ownership). Secondly most of them were levered up heavily on property. Thirdly, the best and brightest of them were wiped out when Dick Fuld and internal emails encouraged employees to buy up the stock at the deal of a lifetime at $25, $20, $15, $10. So, in a matter of months, they lost their income, their savings, their house, some their families. I was lucky to be a junior employee. By the time bankruptcy was filed, I had a new job , but it was still dreadful to watch.

As an outsider looking in, it appears very very strange to me that houses in Seattle are 50% cheaper that in Vancouver. The two countries have far more similarities than differences.

And yes, I’ll be bringing my HAM along, but if I buy at all, it would be in Seattle, not Vancouver. Half the price, same rents. Wow.

#154 taylor192 on 06.14.12 at 5:33 pm

My friends just sold in the peg and took a loss after only living there 2 years. Or shall I say we, the taxpayer, took the loss as the government covers any losses for military families.

I foresee the military covering a lot more losses in the future.

#155 Burnaby Aquarium in the Sky on 06.14.12 at 5:43 pm

Bill Gamble #145:

I’ve been slowly noticing the same thing – the crash has started and people are tightening their belts it’s just a question of how quickly we start to see it in selling prices. Nokia in Burnaby just announced 450 layoffs there, and I’m sure they won’t be the last company to do so locally.

We recently sold our aquarium (it seems like everyone on this blog is looking at condo buildings at night to see if the lights are on so that’s why I choose to call it that) in Burnaby and walked away with $200k. Now living more or less rent free in North Vancouver with $450k in hand while we wait to see what happens. Admittedly some of this is in the orange guy’s shorts, but I can’t win every argument with my wife :)

I’ve recently been presented with an opportunity to invest in a retail pharmacy located in the Vancouver proper area. I had heard that things were slowing down but if London Drugs is feeling it, and my potential purchase would have a Rexxall Superstore as a neighbor, I think I’ll just hang tight and plan on vultching.

#156 jess on 06.14.12 at 5:52 pm

…”It will have the opportunity to do just that on Thursday when it considers the Montana Supreme Court’s decision in December to uphold the state’s century-old ban on corporate political expenditures in state elections. In February the US Supreme Court informed Montana that it could no longer enforce that law until further notice, and now it must decide whether to hear the state’s case. This is perhaps the most serious challenge to date to the Citizens United decision…

In a recent New York Times op-ed, Montana Governor Brian Schweitzer writes that the effects of not being able to enforce the state’s anti-corruption statute “are already being felt here.” He describes “corporate front groups funneling cash into our legislative races,” and bills “ghostwritten by a host of industries looking to weaken state laws,” including overturning a state ban on the use of cyanide to mine gold, and developers seeking “to build condos right on the edge of our legendary trout streams.”

#157 Toronto condo sales falling, prices falling and glass falling on 06.14.12 at 6:04 pm

The Toronto condo market is done. Apparently nothing is moving and new sales have crashed along with resales for condos’s. To make matters worse more glass issues are coming to light as more and more condos are have falling glass issues which will require a fix and thus cost condo owners/speculators alot of money. Toronto glass condos are a ticking time bomb. Many experts are calling for a greater then 50% drop in values which will hit The rest on the GTA REAL market hard. Is it any wonder why GTA realtors post on garths blog with fake sales and other RE propaganda . If the market was well realtors like smokingman wouldn’t be here. Keep spreading the truth garth and buyers sit back and watch the crash. Sales in the GTA have stalled.

#158 Observor on 06.14.12 at 6:15 pm

Shelter is a social issue. Dividend-yielding portfolios are not. Buzz off. — Garth

Wow, the penny has dropped for me that Garth is really NDP at heart.

From Conservative to Liberal but maybe one more step needed?

I mean, it’s fine to hold the opinion that profit is evil on real estate but it’s not the view of a conservative.

What is next no profits on all necesities like basic food and basic clothing?

Looks like Garth could use a session at Kevin O’Leary’s capitalist boot camp.

Long live capitalism and freedom.

Sell your houses for the absolute maximum you can get. It is your right. Fell NO guilt about it.

Nowhere did I say profit is evil. But those who flip and speculate with no regard to the social consequences are not to be applauded. — Garth

#159 Ronaldo on 06.14.12 at 6:52 pm

#59 EJ – ”Vacancy rate is so low because in a housing bubble, it’s easy money to just turn all the apartments into condos and walk off with the profits. Who cares what the result is, as long as you got your piece of the pie, right? Thank your government enablers for this situation.”

And that is exactly what they did in the late 60’s early 70’s when governments enacted rent controls thereby discouraging any further rental development. They said, fine, we’ll build condos, sell them to the boomers like myself who were coming of age and hot to trot to buy.

Turned out good for the developers as they simply passed on the problems associated with these things, like leaky windows, etc. and costs associated with sloppy construction and they laughed all the way to the bank.

We all know what happens during building booms, everyone with a hammer and a saw suddenly becomes a building contractor. Now the lucky condo owner is stuck with the bills and having to deal with strata councils made up of owners who mostly are there to look after their own self interests which can result in strata fees being too low, insufficient funds to look after future costs like replacing roofs. Bad deal for the person buying in at this time.

I know of several persons having purchasd condos only to be stuck with a huge bill for replacement of windows and doors and others getting stuck with costs of roof replacement. And that, shortly after purchasing.

I personally would never purchase one of these things again. Too many hassles and there is always that one person who elects her/himself, the “Condo Cop”.

I am willing to bet there are many of you out there who have had these very same experiences.

#160 NAM not HAM on 06.14.12 at 6:55 pm

19000k listings the Rebgv? Think again, half the amount today. Is it a system glitch or a strategy to show that there’s little inventory. I’ve never seen this before.

#161 Market Bull on 06.14.12 at 6:57 pm

TREB Weekly Stats (week ending June 14, 2012):

Sales – 2,292. Average Price – $518,092.

Looks like another strong month of MLS sales is well on its way. Prices firm and still advancing nicely year over year.

There’s no stopping the success of the GTA.

How it is successful when fewer and fewer can afford homes? — Garth

#162 Timing is Everything on 06.14.12 at 7:15 pm

#153 SG-Astroboy – …Seattle, not Vancouver.

HAM is aiming a bit further south…

‘The super-rich investors responsible for London’s prime real estate bubble are adding California to their wish lists, lured by bargains offering crisis-defying returns as an overdue churn in the United States property market finally gets under way.’

And so it goes…

#163 uh? on 06.14.12 at 7:16 pm

observer, I mean observor, you have totally missed the point. Pack up and go home.

#164 Smoking Man on 06.14.12 at 7:16 pm

#158 Toronto condo sales falling, prices falling and glass falling on 06.14.12 at 6:04 pm

LaughingCON you’re like Red John

#165 Smoking Man on 06.14.12 at 7:19 pm

Garth you’re finally going to nail one.

When Europe goes down the drain, Carney will drop the overnight and your preferds will climb in value

Well Done Gartho

#166 Nostradamus Le Mad Vlad on 06.14.12 at 7:33 pm

#145 Bill Gable and #156 Burnaby Aquarium in the Sky — See links on Nokia further on. Thanks for the Vancouver update, and London Drugs is a pretty good barometer to see life from.

Main thing in the Okanagan is food bank use is up quite a lot, ‘tho (apparently) several of the recipients are quite well off, and don’t need help.

They are taking something because it is free, but there is no such thing as a free lunch. Everything has a price.
2:51 clip Nigel Farage is right on this. With countries always being indebted to one another (or their masters, the IMF or BdBs), it is not necessary for anyone to pay their debts back. Just tell sheeple things are really bad, and “we must bring in austerity measures now” to soothe their masters’ withering brow; Why the world’s #1 and #2 economies are falling to pieces; Westlife’s Shane Filan bankrupt, multi-million pound property empire co. gone; Spain downgraded again Does the populace care? Not really; World’s Richest Man (Mexican) says to increase retirement age; Nario Draghi What is he hiding? Kannnaduhh and the EZone; Athens, Greece Empty hotels (good tourist deals); Jamie Dimon (JPM), this is for you; Nokia Running out of time and money, and 10K jobs gone; Prior to Election — Collapse, which allows for martial law to be imposed, no elections, bank holidays etc.
Syria Soros pleads for more war (so he can make more money); Iran Asking for Chinese and Russian military support; Egypt Caught between the devil and the deep blue sea; US and Israel violate international law with impunity; Arab Spring Immensely; Pope St. Goregonzolas of the Als is slightly off with his prognostifications again; 7:04 clip Uprisings do not appear only in the world’s theatre. The RC Church is also facing its own conflicts; Livestock Deaths Syngenta charged, GM corn killed them; Google Controlling the ‘net one click at a time; Global polio eradication impossible; Teacher fired for showing video, even though students said they wanted to see it.

#167 GBG on 06.14.12 at 7:39 pm

Great post Garth – nice insight into the extremely tight rental market in the city. The best part, however, has been weeding through all of the disparaging comments towards Winnipeg by people who either have never been to the city or passed through the airport/train station/bus station years ago. Real productive use of my time. If we are lucky maybe they will give us their reviews of movies they haven’t actually seen yet based on the trailer they saw on tv.

#168 Ronaldo on 06.14.12 at 8:18 pm

#61 Observor ”I figure interest rates are certain to rise at some point and at that point house prices will fall. They would also fall in a recession.”

From the attached two links, you can see that even during the rise in house prices in the U.S. which peaked in the summer of 06, the Fed had been increasing the rates the entire time starting in July of 04 from 1.00% to 5.25% in summer of 06 before starting to lower them.

The problem is that the damage had already been done but the banks kept the party going with their ”teaser rates”, much like our own banks were doing with the ”prime minus”, some up to minus 2% when bank rate was near 5%.

Like one loans officer at a local credit union said to me in the fall of 09 when I asked him what they would do if the central bank raised the rates. He said, we’ll simply go back to prime minus rates. The thing is, they have nothing to lose, they are backed by CMHC. That is one of the main problems we have with housing prices today plus the greed ridden banking institutions.

Now, all they have to do is stop lending and then watch the prices come down. It will happen so fast, it will make your head spin. I suspect that by this fall, it will all start to unravel. Time will tell.

#169 T.O. Bubble Boy on 06.14.12 at 8:28 pm

@ #161 Market Bull

TREB Weekly Stats (week ending June 14, 2012):

Sales – 2,292. Average Price – $518,092.

Looks like another strong month of MLS sales is well on its way. Prices firm and still advancing nicely year over year.

Ummmm…. 2,292 in 7 days = 9,823 in 30 days.

As a point of reference, monthly sales from the past 3 years:
June 2011 = 10,230
June 2010 = 8,442 (lowest in 8+ years)
June 2009 = 10,955

So, wouldn’t sub-10,000 sales for June be a downtrend?
(as Garth has noted — volumes fall first, then prices follow)

#170 Mean Gene on 06.14.12 at 8:36 pm

Here here!!!!!!!!!!

“Nowhere did I say profit is evil. But those who flip and speculate with no regard to the social consequences are not to be applauded. — Garth”

#171 Phoeey on 06.14.12 at 8:51 pm

Come on people. Do some real analysis on Winipeg instead of parrotting your biases.
What is the population, the radius?
What is the land on the outskirts? Farmland? Reserve?
What is the cost per acre of the fringe land?
What does a house cost to build?
Does government give permission for extra housing to be built?

Do you just ask questions? Do you know the answers? Will you be providing them? Can you actually spell Winnipeg? — Garth

#172 Phoeey on 06.14.12 at 9:12 pm

A sense of humour is required on this blog Garth. I also misspelt parroting.
My guess is that the Winnipeg government has become used to a very low growth rate and makes it difficult to increase supply of housing to meet demand.
When a bunch of extra customers come to McDonalds you will notice McDonalds increases its staff and the price of a Big Mac does not rise there.
Why then in some housing markets does price increase instead of supply? Often government restrictions is the answer to that question. Look to the cost of extra city fringe housing to confirm or deny this.

I was kind. Gave you the parrot. — Garth

#173 T.O. Bubble Boy on 06.14.12 at 9:14 pm

Carlyle – was this you in the ‘shwa?

Man attacked with baseball bat in spat over a parking spot–man-attacked-with-baseball-bat-in-spat-over-a-parking-spot

(could safety be a reason RE is cheaper?)

#174 Market Bull on 06.14.12 at 9:16 pm

#169 T.O. Bubble Boy: Ummmmmm? Are you kidding me?

#175 TnT on 06.14.12 at 9:26 pm

Winnipeg is a contest for pirates!

Win A Peg :)

#176 T.O. Bubble Boy on 06.14.12 at 9:58 pm

oh ya – and those “sales” include many condo assignments (i.e. new builds disguised as resales)

#177 Gta fun on 06.14.12 at 10:07 pm

Observer… Obviously you don’t know how MPAC works… Call them, I did. Property taxes are evaluated by many factors and can rise quickly. Regardless… The end result, even if people can afford to buy the home they won’t be staying in the long term. The consequence of speculation.

#178 PoorgEoisie on 06.14.12 at 10:08 pm

The amazons will still be there after today’s blog is done, feeeed me

#179 Don in the east kootneys on 06.14.12 at 10:34 pm

number 99

4 seasons in Winnipeg–winter–flooding–mosquitos–and winter

We lived there in the early 50’s and as a youngster I always wondered why anybody that was retired with $$$$ would continue to live in Winnipeg. The only reason I assume is being close to children and grandchildren.
Of course you could always go south in the winter and return for the other 3 seasons –mosquitos–winter –flooding

#180 daystar on 06.14.12 at 11:39 pm

#171 Phoeey on 06.14.12 at 8:51 pm

When I use “lazy” and “bitch” to describe someone in the same sentence, it likely won’t end too well for them. Such is the fate of a whiney shoolboy.

What’s so hard about a search on Winnipeg? Its not the 30 second search copy and paste:

Its reading it. Is that something you are up for?

Cost per acre, lot and new builds, good luck sharing something other than an opinion piece with us:

(you’ll have to learn how to spell Winnipeg and surf these sites, I can’t do it for you, same goes for the rest of the questions you apparently have no time for yet demand on the rest of us)

Does government give permission? Its a need to know, ask them.

…. and back to an earlier point on crime. Winnipeg is the oldest city in Canada in terms of the percentage of older houses. Anyone who has ever “just” travelled through Winnipeg will see it at face value. Its old. Winnipeg has higher levels of crime because it has a higher percentage of transient population in a small city with the greatest percentage of older housing in Canada. Look at the demographics not just of Winnipeg but of Manitoba and readers will see that its a melting pot and melting pots are known for conflict.

There are gems in Winnipeg, no doubt. People who have never been to Winnipeg can see that this city has some good stuff going for it if they know what to look for with a simple wikipedia search. But! People who do a drive by because they saw the Jets or Bombers play will see its housing and parts of downtown as aging because it is and people who grew up there will have some love for it because there are good people there as it is… everywhere! Shakespeare coined it best.'s_a_stage

#181 Tony on 06.14.12 at 11:53 pm

Re: #130 Observor on 06.14.12 at 1:25 pm

RRSP’s are nothing but a tax deferral. With taxes likely in the future being much, much higher anyone buying an RRSP and cashing it in later at the same wage scale will pay much higher taxes. Something very few consider but will regret in the future.

#182 Phoeey on 06.15.12 at 12:41 am

#180 daystar
You start your post by calling me a lazy bitch and a whiney schoolboy. Then you fail to answer any of my simple questions.

The reason I don’t research Winnipeg is because I am not interested enough in that market and not close enough to do meaningful research or cross-checks.

I have done lengthy research on the Sydney market (not a few google searches) and can report that government restrictions and high immigration are the cause of housing affordability problems.
My lengthy research on Ireland (not a few google searches) indicates that unresponsive supply coupled with temporary high immigration caused the price boom there from a depressed base. Business slump, reversed immigration and a bit of lagged supply caused the bust.

I now wonder if a similar thing is happening in Winnipeg. Perhaps there is one reader with local knowledge who would care to share it. Abusive know-it-alls who can search on google are easy to find, as are dogma-parroters. People with real valuable local knowledge are much rarer. My questions were addressed to that rare species, not you.

#183 Gunboat Denier on 06.15.12 at 1:50 am

177 Gta fun – from what I’ve read MPAC works just like BC assessment. They dont set the tax rate.

#184 Andy on 06.15.12 at 10:10 am

If anyone is looking for one of the answers why real estate are so expensive here in Winnerpeg, read between the lines of this article in the Free Press. Real estate purchased at inflated prices by Vancouver money during the 0% down, low interest rate craze, pushing prices even higher than anyone here could expect.

There has been some immigration here, but nothing to warrant such a high increase in house prices. Our “booming” native population can’t afford to purchase houses, but do fill slum houses purchased by Peg lawyers during the years when rental houses could be purchsed in the core for under $15,000. Those prices ended in about 2001 with the lowering of interest rates and easing money policies. We are surrounded by “millions” of acres of empty land yet a little building lot in new subdivisions cost in excess of 100G. WTF?

There is one reason and only one reason and that is low down payments (as low as zero), low interest rates, and easy money has pushed prices to ridiculous levels. CMHC which was suppose to make housing affordable to Canadians who couldn’t afford a house has now made it so the average Canadian can’t “really” afford a house. It will end, and it will end badly.

Side note. My sister lives in Seattle (Arlington). Purchased house in 2002 with the easy money policy set by George W and Greenspan to keep economy going. Paid $313,000. Needs to relocate for work. House currently valued at about $140,000 (and its a lot nicer than mine here in Winterpeg valued at $320,000), still owes over $200G. Do the math. What makes us so different here?

#185 woper_holic on 06.15.12 at 11:15 am

@#26Mr Gadget

An amazingly well written article on Canada’s imminent housing bubble. Wow, even the Americans are laughing us now.

#186 I_love_dividend on 06.15.12 at 5:22 pm

6%? It’s so easy….how about more? = 12% = 7%
ipl.un = 6%
exe.un = 10% = 7%

#187 Sid on 06.16.12 at 1:09 pm

@ #40 WPG_Savant_Syndrome:

This is Canada, you should be able to buy weed without fear of getting shot.

#188 Mark W on 06.16.12 at 1:28 pm

The 10% growth in Winnipeg in the last 20 years has come from the underclass of the city.

Quote from article:

“As Silver notes, 100 years ago, the working poor were underpaid and exploited, but they were a vital cog in Winnipeg’s economy. They had power.

Now, the poor are more often people on chronic welfare who have little experience in the job market and who are, for whatever reason, excluded from the mainstream economy.

“There is a big chunk of young men in particular who are often aboriginal, and they never get a foot in the labour market,” said Silver. “That’s a source of trouble.”