Careful what you wish for

Let’s pretend you had three hundred grand and were hot to buy investment real estate because you believe in systemic global economic collapse, or because a dog had a dump in your daisies and he belongs to the financial advisor down the street. Both are powerful motivators.

What’s the favourite form of investment property in Canada? Where have billions been invested in the last four years? You bet. Condos.

Developers have made them painless to buy with weensy downpayments. Realtors have virtually guaranteed price appreciation. And there’s apparently an endless supply of idiot investors who don’t own calculators. If they did, they’d soon see that the definition of a real estate bubble is when prices roar ahead of rents, and how impossible it is to be in positive cash flow unless you buy a unit in cash. Even then taxes and condo/strata fees chew up most of the rental income. And when you factor in the lost earnings of your equity, it’s almost always a negative number.

So why do people do it? Because developers make it easy, and agents fib. And that brings us to Jackie Reid, who gives us the example-du-jour of why you should always keep your pants on when meeting a realtress. Check out her latest vid, and the outstanding logic of why you (as an investor) should move in and bail out other investors (formerly known as idiots).

In case I need to repeat past advice, I will. Condos are toxic, especially in Vancouver or Toronto (or Edmonton, Calgary, Winnipeg, Montreal, K-W or Skatch). The recent changes by F, OSFI & the Ps will have their greatest impact on first-time buyers – the prime condo hornies. Dropping the amortization, ditching cash-backs and tightening lending regs will nail their moist little hides to the altar of federal regret. We are about to see high-rise epic fail.

But you still really, really want to collect rent cheques and feel like an overlord? Then why use that $300,000 as a downpayment on some endangered glass box in urbanity, where a two-bedroom rents for $2,000 a month and you net almost nothing?

There are far better options, as this hormonal blog has sought to underscore. But not in the big cities, where the greatest real estate risk lies. So sally forth into a well-populated but affordable part of the country where properties are unlikely to crash because they never frothed. Better still, look at multi-unit buildings with long-term tenants (preferably seniors), which are already financed and in positive cash flow. Seriously positive.

Do such places exist? Sure. Like Hamilton or Moncton, Windsor or Medicine Hat. Or Chatham. Like this:

Trust me, I’m not endorsing this listing and I haven’t toured the building or met the nice folks who call it home. But if I had $300,000 I might be tempted to plonk it down and assume the existing $623,000 mortgage, ending up with a 20-unit apartment building (eight 1-bedrooms and 12 two-bedrooms). The rents are modest (this if Chatham, after all, when a two-bedroom nets $620), but so are the costs. Of the $140,000 in annual gross income, the net (even with financing at 5.2%) is about $74,000, which strikes me as a cash-on-cash return of 24%, or an overall cap rate of about 8%.

Plus, kids, you get to own a parking lot, elevator, 19 fridges and stoves and a commercial laundry room. The place is fire-retrofitted and the tenants pay their own utilities. And I’m sure they’d all love you to drop by for tea.

So, this is a hard choice. Spend three hundred and almost afford one condo some loser is bailing out of so you can be in negative cash flow. Or spend three hundred and get an apartment building and $74,000 a year.

Here, use my calculator. It vibrates.

192 comments ↓

#1 Me on 07.03.12 at 10:18 pm

First or last?

#2 last mohican on 07.03.12 at 10:20 pm

first first first let the good times role !!!!

#3 TurnerNation on 07.03.12 at 10:21 pm

Equities’ summer rally still in effect!

#4 Superman on 07.03.12 at 10:21 pm

The Vancouver market is crashing – down 14.1% in 4 months. TORONTO IS NEXT!!!

#5 Derek R on 07.03.12 at 10:22 pm

Condos should be provided free with boxes of cornflakes. They should not be bought.

#6 Westernman on 07.03.12 at 10:22 pm

Fuuuuurrrrrrst!!!!! oh yeah baby!!

#7 Jeune Investisseur Immobilier on 07.03.12 at 10:22 pm

So true. It’s been my choice for the last years. Purchased a great 4-plex 3 years ago. Another 5-plex in 2011. Both with positive cash-flow. This cash-flow even pays ALL my expenses to own the cottage up north. How much money do I take out of my pocket each month to own all this and even live in one unit: 0$.

#8 First to last on 07.03.12 at 10:23 pm

Last to first? Sorry Garth had to try just once

#9 Derek R on 07.03.12 at 10:26 pm

And even then it would probably just persuade me not to buy cornflakes

#10 Jeff in Leaside on 07.03.12 at 10:27 pm

Hi. I won’t say it, but I wondered why there aren’t any comments yet.

Would love to own an apartment building. Garth makes it sound so simple.

#11 Pierre Petit on 07.03.12 at 10:28 pm

First!

#12 Bo Xilai on 07.03.12 at 10:29 pm

Jackie Reid says

“Money for nothing and your cheques are free…”

#13 Don't read his post on 07.03.12 at 10:29 pm

I’d like to put an offer on that. Right away

#14 Retired Boomer - WI on 07.03.12 at 10:31 pm

US fourth of July tomorrow (Our Canada Day).

The EU is still awaiting Germany’s exit, our markets up to flat.

RE seems to me making some anemics value lifts here (for how long?)

My northern neighbors are about to get a dose of economic reality with mortgage gagging by their Fed. I hope it isn’t going to be TOO PAINFUL but, some pain is deserved, for the morons who bought with zero to 10% down.

Just decided to take most of my market gains off the table with 8-10% gains in 2012 booked. Why be greedy? Do YOU sense blue skies ahead? Not me, manufacturing sucks, debt levels suck, the US keeps increasing its debt levels, and cash still has SOME value. Bonds are getting to be value trap.

Time heals all fools. I’ll cool my heals for awhile until I see a reason to invest in something. (might be cheap RE??)

Still the debt free have fewer worries. Who cares if it all goes ka-blooey tomorrow? Nice place to be. First

#15 Network Admin on 07.03.12 at 10:31 pm

>> Here, use my calculator. It vibrates.

Menu > Settings > Language & Keyboard > Touch Input > Text Input – select Vibrate when typing

#16 Former Expat on 07.03.12 at 10:33 pm

Love the blog. We left our fun expat life because we had kids (they ruin everything – good thing they’re cute) and moved back to Canada. We’ve just moved into our third rental since being back, and the landlord couldn’t ‘get’ why we were prospective tenants. “They own XXXX business?!? Well, why don’t they have their own place?” (We bought a very stable business here in town with our savings.) The hardest part is paying money to make the improvements that we want to make it our ‘dream rental’… ripping out old carpets and the like. But when I think of it in terms of making the improvements AND having a loss on house value, it gets easier.

#17 Lost cash on 07.03.12 at 10:33 pm

Go ahead Garth buy it, big shot!!!!

#18 Mr Buyer on 07.03.12 at 10:35 pm

Now you are talking. That was my grand plan in my twenties (that is to build or buy an apartment building). Even my most modest plans now consist of some kind of newly built duplex or triplex. The wife is against it but she is slowly coming around. This place is pricier than I would like but it is up and running and really low risk over all. It seems there may still be hope after all. What a difference a day makes. I know it is a real crap shoot with renters but life is not without risk and this type of risk is right in my face, I can fully understand it quite easily. If I continued working I could get out from under the mortgage within 8 or 10 years barring some horrible maintanence fiasco (I have a top flight engineer doing house inspections for me and his word is gospel to me. My philosophy is that maintanence is something best avoided by not buying or completed just after closing and thus factored into the purchase price), Who knows there may still be the outside chance of possibly having some semblance of a future in Canada(The down payment would likely tap us out though, or close to it anyways, but if it is stable income property that is a different animal all together).

#19 Juan on 07.03.12 at 10:36 pm

I hope I can own one of those multi-unit buildings one day. By the way, that video made me feel kind of sick…and there will be people that take the bait, as always. Thanks for keeping trying to open some eyes out there.

#20 Canadian in Texas on 07.03.12 at 10:40 pm

OMG she reminded me of a female Ricky from the Trailer Park Boys.

Still waiting for an opinion on Ottawa RE. I think a 25% drop is in the cards.

#21 CONDO CRASH IN TORONTO on 07.03.12 at 10:41 pm

Flippers are in a panic to sell their condo before its loses 50% of its valued. Realtors and mortgage brokers are in a state of panic while hoping people are beyond stupid and buy before the market crash becomes to obvious. Toronto and Vancouver are toast.

#22 Stinky the Fish on 07.03.12 at 10:42 pm

Our housing market has been beaten down by the OECD, The Economist, and almost every economist… those of us who haven’t learned from recent experiences of other housing markets deserve to get a smashing

This is the only site that doesn’t ban my comments. Thanks Garth. You are also my only friend.

I need a shower. — Garth

#23 TaxHaven on 07.03.12 at 10:42 pm

Yes, good advice. Nice apartment building. But you’d only be safe paying cash and not assuming a massive mortgage.

Bad stuff happens. Tenants smoke. Trash the suite. Steal the lightbulbs. Deal drugs. Lose their McJobs. Fail to qualify for Welfare. Move – out – frequently. Have their stuff repossessed. Trouble with the cops. Mass sleepovers. Illegal sublets. Late on their rent – repeatedly.

Or no tenants at all. Rising unemployment: downward pressure on rents.

And you are responsible for taxes. Lawnmowing. Repairs. Snow removal. Keeping it up to code. Perhaps some legal problems with tenants…

Without a cash cushion elsewhere and with a huge mortgage what you are doing is relying on short-term and fickle income to borrow long to pay off a depreciating asset. Like a bank.

Point is, it’s risky.

And these days it would be better to worry about simply maintaining one’s wealth rather than risking it in a desperate effort to have cash flow…

Think small. The most valuable asset any of us can have these days is a simplified, liquid, frugal and economical, yet comfortable lifestyle – debt-free.

#24 calator on 07.03.12 at 10:42 pm

Are there any rules to be approved before July 9th and your 30 years pre-approval will be available after that for 90 days or starting July 9th the 30 year mortgage is dead? Thanks!

#25 Foggy on 07.03.12 at 10:44 pm

When I early-retired in 2006 my plan was to buy a cheaper, smaller house well away from the GTA. I researched a lot of homes from Chatham up to Kincardine. My budget was $50K up to $150K. There were plenty to be found from fixer-uppers to nice rural homes on big lots. Ultimately the deciding factor was the hot humid Ontario summers, which eliminated the Windsor/Chatham/Leamington area. Soon after prices for all these same places started to rise significantly as they caught the Toronto contagion. So I wound up on the East Coast, where summers are moderate.
But if you don’t wilt in the heat like me, SW Ontario and up the Lake Huron coast is good value for retirees. I remember Lucknow as being a nice little town.

#26 Toronto Bubble on 07.03.12 at 10:45 pm

Thanks again Garth!

#27 T.O. Bubble Boy on 07.03.12 at 10:45 pm

Or, buy an apartment REIT and save the phone calls over leaky faucets and clogged toilets.

(ok, I’m joking — most REITs are getting a bit frothy, and this kind of return won’t be easily found)

#28 Devore on 07.03.12 at 10:45 pm

Wow! Income with no work! Where do I sign up?

#29 xyz on 07.03.12 at 10:46 pm

Jackie is coming off desperate…

She should get in touch with the guys flogging “Vancouver House Flipping” Seminars on the radio lately. They’ve been cultivating idiots on an hourly basis

#30 Jane on 07.03.12 at 10:47 pm

Jackie is desperate to find some greater fools.

#31 Fleabitten Monkey on 07.03.12 at 10:51 pm

Garth, how long to you feel, at a minimum, the Feds will keep the 25 yr am rule on? Wondering what your sentiments are with respect to them sustaining this.

If they relent, we are in for a rough ride. — Garth

#32 LH on 07.03.12 at 10:56 pm

Bang on Garth!

Only problem… Unless one lives in Chatam, long distance management is tough. This is why central Toronto multi unit cap rates are lower. Five to six percent is par for the course, which makes financing the key. Can’t recommend multi family more for those cashed up however! Real yields at 5-6 when linkers are negative through 10y, sounds like a good deal to me!

#33 Aaron - Melbourne on 07.03.12 at 11:04 pm

Fair value in building and construction? Having been ripped off blind on the De-salination project and other major infrastructure initiatives our State Government decides to shut the gate after the horse has bolted.

Maybe they are concerned that with slowing domestic and apartment builds all the idle hands will make up for lost ground scamming on Govt projects?

http://www.theage.com.au/victoria/construction-workers-down-tools-to-march-on-city-20120704-21gc1.html

“Under the rules, a tenderer must submit a workplace relations management plan where the government contribution to the project is more than $10 million, or is at least $5 million and represents at least half of the total construction project value.”

I’m predicting the next stage in the game is massive industrial turmoil in an environment of high unemployment and high inflation.

#34 Devore on 07.03.12 at 11:05 pm

#23 calator

If you’re asking what I think you’re asking, then you have to close before the deadline. Preapprovals are meaningless.

#35 Superman on 07.03.12 at 11:09 pm

Garth, that video is pure gold. You’ve probably ruined that old woman’s day. The comments on the youtube are starting to roll in… she is probably wondering what’s going on. She sounds so desperate in the video – a true shyster. Looks like she’s had a rough life too… stay away boys.

#36 randman on 07.03.12 at 11:10 pm

John Embry interviewed

“HRN: Are these problems the result of Keynesian economics?

John Embry: If you really

DELETED

If you’re going to copy-and-paste from a US gold-pumping newsletter, at least give the reference. Then we can all ignore you. — Garth

#37 Tim on 07.03.12 at 11:11 pm

Buy a Riet instead, they’re a lot less hassle and a lot more liquid

Nobody to have tea with, though. — Garth

#38 dd on 07.03.12 at 11:16 pm

Barkley rigs LIBOR. $350 trillion transction affected in 2011 What else to banks manipulate? The top will soon be blown off.

You’ll have company. How pleasant. — Garth

#39 Aaron - Melbourne on 07.03.12 at 11:17 pm

This is as close to capitulation as we will get from the mainstream media…

http://www.theage.com.au/opinion/politics/ceiling-on-housing-affordability-reached-and-wont-be-breached-20120703-21fbj.html

Bear in mind that Gittins! is regarded somewhat like a weird relative rambling at a family bbq. Nobody pays much attention. And like a sucker fish he has latched onto the much more respectable Saul Eslake.

There are a number of factual inaccuracies in that article I don’t have the time to address in full. The most glaring of them was the trickery about median house price to income ratio moving from 2.8 (1993) to 4.0 (2001). Yeah well now that figure is hovering around 8.0 (depending on which capital you are looking at) but he seems to have glossed over that bit.

The thrust of it seems to be: prices will be maintained at this level but parents should dip into their own equity to help their kids get into the market and sustain the whole ponzi.

Sound like a “Permanently high plataeu” argument?

#40 Grim Reaper/Crypt Speculator on 07.03.12 at 11:24 pm

Smoking Man…

On vacation and Boating?

When 10 naked Amazons with beer and smokes come by your Canadian Tire canoe…I will be one of them…bwahahahahahahaa

#41 Elmer on 07.03.12 at 11:27 pm

I’ve been happily renting a luxury condo in Toronto for a few months, and just got a call yesterday from the owner, he’s going to sell. The rental income doesn’t cover his carrying costs. If the new owner is also an investor then I’ll have no problem, but if he wants to move in himself, I’ll have to move. Garth, if I find out you had anything to do with making my landlord decide to sell, you have to help me move.

In regards to the building you linked to, the problem with being a landlord of buildings like that where rent is fairly cheap is that a lot of people who live there are deadbeats and you’ll have a hell of a time collecting rent. When you rent out a luxury condo in a big city, you can easily find a renter who is a professional (like me) with a stable income and a good credit that he doesn’t want ruined so you’re very unlikely to have problems (not saying it can’t happen, just that it’s less likely), whereas in smaller towns and cheaper buildings it’s harder to find quality tenants and you’ll get a lot of single moms, alcoholics, welfare bums, etc.

You deserve to be homeless. — Garth

#42 Bottoms_Up on 07.03.12 at 11:30 pm

#20 Canadian in Texas on 07.03.12 at 10:40 pm
—————————————-
Average price in Ottawa is around 360k. So a 25% drop would put the average price around 270k. I can’t see this happening in a low interest rate, high employment environment. (yes, we have more people employed in Ottawa than ever before–the private sector is doing well)

If mortgage rates shot up to 8% next year, perhaps we’d see a significant drop in prices.

Remember Ottawa is overpriced, but it never got as crazy as some of the other markets.

I think a definite 5% drop over a few years could be in the cards though.

#43 mark on 07.03.12 at 11:34 pm

She’s not hot enough to make me want to buy.

#44 Rikki on 07.03.12 at 11:34 pm

Interesting; 20 suites, but only 19 stoves and fridges…

#45 wes coast on 07.03.12 at 11:40 pm

I wonder what the oversupply of condos will do when the market crashes. Won’t the speckers that get stuck with these boxes be forced to rent them out below cost to minimize their losses? That’s what happened to you right Garth – back in the 80’s (I think)?

Anyhow, I wonder if we will see rents falling in tandem with housing prices. How does one account for this when looking to buy a rental building today with potential of 1) falling rents and 2) rising rates.

I’m guessing the difference here is leverage. If you can buy with cash there may be a return but if financing it seems the rewards aren’t there (yet)

Thoughts?

I just demonstrated the rewards can be there. — Garth

#46 Fred on 07.03.12 at 11:49 pm

That video pissed me off, urge to slap her is great.

#47 skyfalling on 07.03.12 at 11:57 pm

Hey Garth, impossible to stop the first crowd eh?……tomorrow I will be firssssttttttt!!

#48 charles on 07.03.12 at 11:57 pm

As a previous landlord you give me that property and I will refuse it. Not worth the headaches and expenses and the capital gains that I had to pay when I sold (thank God). I bought a small bungalow

#49 DonDWest on 07.04.12 at 12:03 am

I guess I’ll be the first to point out that people on welfare generally can’t afford $700 a month in rent. As hard as it is to believe, people actually do work while renting one or two bedrooms across Canada for $700 a month. Welfare at most allows $500 per month for rent, and in order to get this amount you must prove you have some sort of chronic disability.

#50 Ronaldo on 07.04.12 at 12:04 am

Incredible deal Garth. If I recall correctly, the cost in 1979 dollars for similar apt. would have been around $660,000. A thirty unit back then that my neighbor had built was valued at 1 million. Rents were about $500. Mostly 2 bedrooms. $20.00/hr was an excellent wage for this northern BC community. $15.00 was pretty normal so rents represented about 1/5 of an average wage. It would be interesting to know what the average wage would be in Chatham.

#51 Saskatoon-Living on 07.04.12 at 12:06 am

LOL! That video was hilarious! I see a career in Amway for that girl in the video!! LOL!

#52 Investx on 07.04.12 at 12:08 am

If those Vancouver units are such a great investment opportunity, why doesn’t Jackie Reid take advantage and snatched them up herself?

#53 Superman on 07.04.12 at 12:12 am

#49

She said in the video she gets enjoyment out of seeing others get rich. She is just being nice and passing on opportunities. She would buy them herself, but then all her “friends” wouldn’t get rich with her. She wants us ALL to be rich!

#54 louise on 07.04.12 at 12:15 am

Man, am I busy these days, reading for work, reading this entire pathetic blog every day, spit’n’n polish’n my condo for sale, and JOY, reading my new MONEY ROAD book, finding out everything I’ve done wrong so far and gratefully what I can do to (try to) turn things around… thanks BIG time, Garth!!

p.s. #41: ditto what Garth said

#55 randman on 07.04.12 at 12:15 am

“If you’re going to copy-and-paste from a US gold-pumping newsletter, at least give the reference. Then we can all ignore you. — Garth”

Wow …not one reference to gold in that two paragraph
excerpt

Can you say…sensitive?

#56 totalchaos on 07.04.12 at 12:16 am

I have just accepted an offer for my multi-unit in the lower mainland. Cash-flow positive, good ‘hood, great tenants. I can hardly wait to get out. No work for the return – Ha!

For a 20 suite building, if you get 3 calls per year per suite, (possible, but unlikely) that is 60 calls per year. Most require a visit to assess the problem and a second visit waiting around for an appliance guy/exterminator/plumber, etc. That is 12 visits per month.

If your average tenant stays 3 years (possible, but unlikely) you are screening new tenants every 2 months.

If that sounds reasonable to you, remember these calls are unscheduled. You might have 3 months with no calls and two months of hell. Or filling 5 suites in one month! Be prepared to cancel holidays if that happens.

I’m not saying don’t do it, just be realistic about the work involved. I have enjoyed managing my place for the most part and have met some really interesting people. My life situation has evolves, however, and I am looking forward to “quitting my job”. Now we own it outright, I can get the same returns from preferred shares, go on holidays on the first of the month and not cringe when the phone rings!

#57 Of_Montreal on 07.04.12 at 12:18 am

Garth, can you check that YT link?

It’s supposed to be about RE, but instead it linked to some broad staring into the sun doing something that resembles stand-up comedy.

#58 Snowboid on 07.04.12 at 12:31 am

#45 wes coast on 07.03.12 at 11:40 pm…

I think you will see rents stabilize once prices are down to 18-19 times annual rent – at least here in the Okanagan (soon to be sunny). In the meantime they are still coming down, even within our own complex.

Currently our luxury condo is valued about 25 times our annual rent – so it has a ways to go.

Patient we are…

#59 Hoof-Hearted on 07.04.12 at 12:59 am

Garth is probably right.

I can’t see condos being turned into rentals…such a glut and the logistics won’t work for many reasons. They will end up as ghost buildings.

Old rentals will hold value, they aimed at a niche market.

#60 Nostradamus Le Mad Vlad on 07.04.12 at 1:00 am


“Careful what you wish for because a dog had a dump in your daisies and will nail their moist little hides to the altar of federal regret.” — Who works under Federal Regret? Not F, surely! As to the concept presented, I prefer REITs. Unlike old codgers, they don’t fight back.
*
#262 Hoof-Hearted on 07.03.12 at 9:32 pm — “According to some wags…..it is huge….the debt is 10X’s what all Global Assets combined are worth.” — In essence then, we’re being raked over the coals daily. And I thought it was just summer that the temps. were increasing!

#267 Nemesis on 07.03.12 at 9:57 pm — Merci for the update! I will continue with postings of the weird stuff as well, to keep you entertained!
*
Boeing and Asia Airbus said yesterday it’s opening a plant in Mobile, Ala. so Boeing wants a greater chunk of Asia, and New Jobs (in Asia?); BoE Now all the juxtaposing fun starts; Trending with Canada? Personal debt; Oil The world needs more crises! Harrods Hotels? Work less Germans do; Tenants Fiscal troubles leaves them owing; Banxters Still at it; Investing in India; Heathrow expansion? The place is massive to start with; Buffalo Bob’s Bonanza Read it and weeple, sheeple; How Minimalism could prevent finances from going under; EZone Banxters in charge; Encouraging Bank Fraud Western govts. have nothing left to do (other than false wars); ExxonMobile Can’t leave Af’stan alone; Get Rich Slowly vs. taking fiscal risks.

40% stock plop by year’s end? Big Banks Living Wills Update; Wary Consumers Don’t bank on us; Oil Jumps; China Increasing overseas investments; BRICs Economic meltdown; Legals and Wills can be a mess; Recession? Charts say no; Seven Charts; Dubai’s Plummeting Prices; 2:17 clip 19th Euro Breakdown; ESM Rejects Finland and Holland; Euro is broko.
*
Off the grid and preparing for it — This is one reason why; Croc’s for lunch? Biggest in captivity; Expanding Cities That’s another thing TPTB would like — twenty million sheeple squashed like sardines in a can. That way, drones can keep a permanent eye on us; UN One World Govt. Threat to second amendment; TSA Pre-Check Skip most security, etc.; Angola Another Chinese ghost town pops up; Macau Casinos Quite nice; Google and China.

#61 Aquarian on 07.04.12 at 2:10 am

If the return was that good, why are they selling?

#62 Freedom First on 07.04.12 at 2:16 am

That video with Jackie is really something. I felt like I had just been propositioned by a true professional. But she failed. I am quite simply left with the impression that she was trying to do me like a doggie. Pass.

#63 eagle eyes on 07.04.12 at 2:26 am

Be careful what you wish for is right. If you have ever been a landlord you would know the headache of managing 20 suites. I would liken it to having 20 kids – some teens, infants, newborn, and the adult children who won’t move out of your basement. Everyday you will get a new problem, which means that you will inevitably have to pay for something. Not to mention the repairs will be constant, and the maintenance of elevators and laundry? Elevators are VERY costly. Washers and dryers will be replaced periodically and service contracts are VERY costly. A new roof, siding replacement, landscaping, new carpets, re-piping? That is only if you don’t have the headache of trying to collect rent from some of the kiddies who refuse to pay. The title of being a landlord is very attractive, but the day to day duties are very tedious.

#64 Mr Buyer on 07.04.12 at 2:36 am

#42 Bottoms_Up on 07.03.12 at 11:30 pm
#20 Canadian in Texas on 07.03.12 at 10:40 pm
—————————————-
Average price in Ottawa is around 360k. So a 25% drop would put the average price around 270k. I can’t see this happening in a low interest rate, high employment environment. (yes, we have more people employed in Ottawa than ever before–the private sector is doing well)

If mortgage rates shot up to 8% next year, perhaps we’d see a significant drop in prices.

Remember Ottawa is overpriced, but it never got as crazy as some of the other markets.

I think a definite 5% drop over a few years could be in the cards though.
…………………………………………………………
Dreaming. The prices doubled in Ottawa over the past few years. There will be a healthy crash there as well

#65 cynically on 07.04.12 at 2:37 am

The correction is coming, the correction is coming — and so it should. The local realtors have been living high-off the hog for a number of years now with no pity for those buying their first home and creaming those multi-unit buyers from you know where. Lots of greed on both sides. Maybe I won’t have to listen to those “World Class City” spiels that only the tourist bureau should be mouthing even if it isn’t true. Unfortunately the local peasants have begun to believe it as they question why anyone from abroad would pay these overly-inflated prices for 600sq.ft. in the sky — home prices don’t crash in real W. C. cities. Even in America’s darkest last few years Manhattan prices have gone up and S.F.’s have held up but these prices never spiked over those years like Vancouver’s and to a lesser extent Toronto’s. Unfortunately this coming mess is going to affect more than greedy realtors so batten down the hatches for the storm is coming.

#66 Humpty Dumpty on 07.04.12 at 2:54 am

This Land Lord says “NO more Vacancy”….

UK’s borders ‘will be closed’ to refugees from Greece and other failing countries if eurozone collapses

http://www.dailymail.co.uk/news/article-2168367/Eurozone-crisis-UKs-borders-closed-refugees-Greece-countries-eurozone-collapses.html?ito=feeds-newsxml

“IF the Euro collapses”…

#67 THE TITANIC on 07.04.12 at 2:59 am

I’m post dating this for June 4 2012…First.

#68 THE TITANIC on 07.04.12 at 3:01 am

shoot… should have said post dated july 4 2012…wobbly pops on a school night will do that to you. First!

#69 Nodebt on 07.04.12 at 3:01 am

Hey Garth, love ur blog! That chick is crazy! That’s one of the dumbest things I have ever heard come out of a woman’s mouth! I feel sorry for her husband!

#70 Buy? Curious? on 07.04.12 at 3:04 am

Thanks for the advice, Garth, considering your loss. Andy Griffiths was an icon to your generation and will be sadly missed. I would love to deal with hicks from Chatham with their backwater values.

#71 lookoutbelow on 07.04.12 at 3:16 am

OK Garth, enough is enough. You can’t teach idiots how to use a calculator because they are idiots. People who make decisions that involve hundreds of thousands of dollars in just a few minutes or even seconds. And then they go to The Bay or Sears or Zellers (soon to be Target) and refuse to buy a small item because it’s NOT ON SALE yet.

Why don’t you put out a little feeler to all the blog dogs here to contribute to a little fund that will be used to take out full page ads in 2 major national newspapers (I don’t think we have three, do we?) and maybe 6 local city papers summarizing what we all think of the investment potential of real estate in Canada’s major centres over the next 3-5 years. Okay, just focus on Vancouver, Toronto and maybe Calgary.

Idiots can at least read. All the rationale for staying away from an asset that is likely to bankrupt the most if not all of the 0/40, the 5/35 or the 5/30 crowd that bought in the last 2-3 years.

The way I see it, it could the “Inverse Brad Lamb” business case for staying away from an over-priced asset.

In the words of the inimitable Don McLean in the song Vincent (starry starry night):

“They would not listen, they are not listening still”,
“Perhaps they never will”

But look, at least we would have all tried. Yeh?

#72 Aussie Roy on 07.04.12 at 3:40 am

Aussie Headlines

Record number of houses for sale in Melbourne

Melbourne has the largest and fastest-growing stock of available housing in Australia, which is likely to put further pressure on house prices in the city.

In June, Melbourne’s residential listings grew at a monthly rate of 6.1 per cent – almost four times the national average – and recorded a yearly jump of 27.7 per cent, more than 27 times Sydney’s annual growth of 1 per cent.

Melbourne now has 55,293 unsold homes and apartments, according to today’s report.

1.
http://www.theage.com.au/business/property/record-number-of-houses-for-sale-in-melbourne-20120704-21guk.html

2.
http://www.bloomberg.com/news/2012-07-04/melbourne-homes-for-sale-jump-28-to-four-times-australian-rate.html

Realtors feeling the slump

BLAME it on the real estate slump or the desire of realtors to have fat wallets because an agent has been cold-calling people on a database and offering a $500 ”referral fee” if they recommend vendors who sell their property through the company.

http://www.theage.com.au/national/melbourne-life/agents-500-tipoff-fee-gets-hammered-20120703-21fa9.html

#73 Soylent Green is People on 07.04.12 at 4:44 am

DELETED

#74 daystar on 07.04.12 at 5:17 am

There are two things I don’t like about this building the way its marketed. The age isn’t given and the sizes of the units aren’t given. The units look small.

$620 x 12 x 12 = $89,828.00 for doubles
$500 x 8 x 12 = $ 48,000.00 for singles unless singles are worth more but its hard to say. If the rent records can’t be produced along with stated income, drop the numbers.

Total: $ 137,828.00 assuming full occupancy.
$124,045 at 90% occupancy. (90% occupancy is reasonable considering 5,000 full time and 12,000 part time students live in Chatham and some renters will be students)

Drop a free rental for the building manager $7440.00 and we are at $ 115,605 gross at 90% occupancy assuming a free rental for management is enough. We might be able to get a senior with fresh legs to look after it for that. Maybe.

$115,600 gross is a steep drop from $140,000 gross and to me that seems legit.

We still have municipal taxes, insurance, some utilities and maintenance costs, a possible room reno or two, a boil system crapping out, we don’t know and I wouldn’t take the Realtor’s word for it on insurance.

http://en.wikipedia.org/wiki/Chatham-Kent

Whats the minimum down, 25%? I’d be looking at its peers before getting too excited. It should pay for itself at asking but I’m not at all convinced of meaningful positive cash flow. We need to look at the math on higher rates… what a $300,000 downpayment will make invested elsewhere, peer competition and keep this one in mind with a lowball offer once the unknows are known is what I’m thinking. (everything has a right price but its not for me, don’t have available cash to invest and I’m too far away)

#75 Smoking Man on 07.04.12 at 6:30 am

Oh. Bubble heads. Doing the happy dance like no tomorrow . F and C plan to get lots of Red dots on the MLS in gta is working. MSM big re in a buuble has paid off. Now as quickly as the stories dominated the headlines watch the stories vanish. Its what the machine does. Watch and learn my little grasshoppers.

No interest rate spike for years and years and strong diverse job market in the GTA

No crash sorry

#76 Aussie Roy on 07.04.12 at 6:38 am

Aussie Headlines

“As safe as houses”

Provident Capital in receivership, stranding investors

There is about $130 million invested in debentures in with Sydney businessman Michael O’Sullivan’s Provident Capital.

Provident Capital is a funds management and investment group offering fixed-interest investments and mortgage lending products.

These investments are secured against a portfolio of non-conforming mortgages secured over Australian residential and commercial property. The business has some 3,500 debenture holders who have invested in Provident Capital’s debenture product.

PPB Advisory’s appointment follows concerns raised with the Court by AET that there is a deficiency in net tangible assets available to meet the claims of debenture holders.

http://www.smh.com.au/business/provident-capital-in-receivership-stranding-investors-20120704-21gpr.html

#77 bigrider on 07.04.12 at 7:27 am

http://www.youtube.com/watch?v=sv-bGxhrkKg&feature=em-uploademail

On high frequency trading and the abnormal correlation of asset classes in today’s financial markets.

First 5 or 10 minutes or so is all you have to listen too.

Fundamentals no longer matter

Of course they do. The more absolute statements are, the inherently dumber they become. Congratulations. A 10. — Garth

#78 House Horny Housewife on 07.04.12 at 7:32 am

Garth,

Why is everyone making the business of renting look so easy ? It damned well isn’t.

After you have plunked down your money, signed all of the ownership papers, indebted yourself (again) to the bank and paid off your real estate agent, you have to realize that you have just purchased a BUSINESS.

This means that, as a landlord, you have certain responsibilities in exchange for collecting that rent cheque. Unless you intend to hire a superintendent or something, YOU are responsible for fixing anything that goes wrong in any one of those units (and even if you hire a super, you have to pay him or her).

Think of it as the headache of owning a home TIMES 20. You know, when your toilet clogs or break down and you have to call a plumber who charges $150.00 an hour just to put a snake in there and pry things loose. Or when heating thermostat breaks and you have to have an electrician come in to fix it .. or the plumbing leaks or whatever. YOU and only you are responsible. That is if the tenant is responsible enough to let you know immediately because if they don’t (some don’t want to bother and just put duct tape over it or something) it will cost you 20 times more to fix it later, due to all of the damage that the small leak or whatever has caused (water leaks inevitably rot 2 by 4’s and weaken the structure, inviting carpenter ants and mold etc etc..).

Invite you for tea ?! Are you kidding me ?! Tenants are notorious for leaving garbage outside of their doors instead of depositing it in the receptacles immediately, making swiss cheese out of your walls because they don’t know how to use a hammer or a screwdriver, painting walls black so when they leave and you have to rent it to someone else, you need ten coats of primer to change the colour etc. etc.

Renting is not for the faint of heart and it is a business, pure and simple. The money doesn’t “roll in” on its own. If there is a cockroach or rat infestation because the guy in 2-D leaves crumbs all over the place, it’s YOUR problem. If Bertha down the hall plays her music too loud, YOU will get a call about fixing the problem. If the roof leaks or someone trips on the front stairs, it is YOUR responsibility. If someone’s appliance is dangerous and causes a fire .. well that’s now your problem too.

Oh, and I am not even mentioning having to collect the rent and how many times people don’t pay their rent on time. And if you are thinking, “well fine, I can simply kick them out” .. good freakin’ luck because the law is extremely tenant friendly .. at least here in Québec. It usually takes about 3 months to get someone out and only after you have spent tons of money on legal fees and gone through a lot of hassle.

I agree with you, Garth, that owning a house is not as cheap as renting and it is not for anyone who cannot afford it, mainly due to all of the upkeep that a house entails. And for the same reason, being a landlord is even more time consuming .. because the users of the premises are often unpredictable. If you don’t do things right, you can loose your shirt, guaranteed.

Renting is definitely a headache I would stay away from, unless I was really desperate.

HHHW

Owning rental properties is as worthwhile an occupation as whatever you do. BTW, what is that? — Garth

#79 TurnerNation on 07.04.12 at 7:38 am

Airbus just announced a new plant opening in Alabama, USA. A right-to-work state.

That’s right, a French plane manufacturer assembling its product in USA.

CANADIANS: no factory will re-locate to our country, until we are willing to work for $15/hr. I’m sure Harper is frantically working to speed up this process. His constituents (corporate lobbyists) are working 24/7, while we laze in front of the TV.

Tell your kids what they might expect.

Burp. Pass the Freedom Fries.

#80 Timbo on 07.04.12 at 7:44 am

http://www.spiegel.de/international/business/german-economy-shows-dangerous-signs-of-weakening-a-842240.html

“Companies had been banking on the assumption that growth in emerging economies would offset weakness in the euro zone. But now even those markets are no longer as promising. Growth is weakening across the board in the emerging markets, a Citigroup study concluded”

Taking my marbles and running home…………….

http://www.guardian.co.uk/business/2012/jul/03/bob-diamond-quits-barclays

http://www.cnbc.com/id/48058410

“It was ridiculous that he thought he could stay on after the Libor scandal,” one senior executive said Tuesday morning. “It made us look like crooks and fools.”

Some even began plotting to force Diamond, who is American, to step down. Many of the Barclays Capital employees interviewed are former members of Lehman Brothers, the failed investment bank taken over by Barclays Capital during the financial crisis.

“We were like, ‘What world is he living in?'” one trader said. “How could he not see the writing on the wall?”

Banking soap opera gone viral. Tell all books are in the making and movies will be made………………..

#81 Jim Lahey, Sunnyvale Trailer Park Supervisor on 07.04.12 at 7:44 am

As someone with lots of experience dealing with tenants of the trailer park variety I can only make one statement in regards to the rental Captain Garth has shown us today, “stay the hell away” unless you enjoy dealing with the likes of Ricky, Cyrus, Jay Rock, etc. A building full of Bubbles would be ok but it isn’t going to happen. Plus, even with the lovable Bubbles, you would have cat litter everywhere…

#82 yorel on 07.04.12 at 7:52 am

Who shot that video? Her 10-year-old son? If she’s doing so well, you’d think she could afford a professional presentation.

#83 bigrider on 07.04.12 at 8:08 am

Garth, how much has the litany of Italian builders in the GTA offered you to scuttle this blog?

I saw you shaking your head in the back corner table of Harbour sixty as you pushed back the suitcase, Brad Lamb acting as there ‘bitch’.

Looked like a scene out of the movie Casino or goodfellas, all that expensive booze , the $5000 suits ,back slapping and the ‘Eh-O’s” flying around.

Nice to see you sticking to your guns…LOL

#84 bigrider on 07.04.12 at 8:14 am

#77 Garth to Bigrider on high frequency trading.

Garth , if you think that high frequency trading has not had an immense effect on financial markets, in that they have not made fundamentals less relevant, then you are naive.

As for the presenter in that video sounding dumb, I am quite sure that the 45 minute presentation, if you had actually listened to it, would have laid out exactly why correlations in the market are as absurdly high as they are today, among other aspects of this ‘broken’ market.

You ignore the obvious.

I responded to your statement that fundamentals no longer matter. The guy on the vid is an institutional hedge fund trader. He said what you’d expect him to say since he has a vested interest against retail trading. — Garth

#85 robert james on 07.04.12 at 8:25 am

I just watched the Jackie Reid vid.. That was hilarious !!!! I find it hard to believe that there could possibly be anyone stupid enough to believe that clown.. She is begging people to buy for God`s sake !!! UNBELIEVABLE !!! LOL

#86 Don't read his post on 07.04.12 at 8:44 am

I got it!!! I’m going to short HCG. This will be a big loser in the months and years o come.

#87 Bigrider on 07.04.12 at 8:58 am

# 84 Garth response to bigrider.

Fine , my statement about fundamentals no longer mattering was to absolute, I will watch the wording of my comments more carefully.

What I wanted to impress upon you and the blog Is that HFT and the correlations of movement of asset classes is abnormal, at least from a historical perspective. I would also through observation conclude that volatility is abnormal from a historical perspective.

To ignore these new market paradigms is to be naive.

The distrust people have of financial markets is further fueled by these distorting actions, even if most investors don’t know what they are.

#88 Bigrider on 07.04.12 at 9:00 am

Sorry got to watch my words on an iPhone, meant to say the increased volatility from a historical perspective

#89 Toronto_CA on 07.04.12 at 9:06 am

I have a good friend who owns a bunch of multi-unit apartment buildings in Kingston.

His net worth is very high for his age (mid 30s) but when we go on vacation, he is tethered to his tenants and constantly in lawsuits trying to evict them or get rent and obsessed. The lawsuits leave him extremely stressed out.

I have to agree with HHHW on this one, being a landlord wouldn’t improve my quality of life (although I suppose you could outsource 99.9% of the stress, not sure you’d stay cash flow positive unless you did it all in cash, and even then if you had that much cash, why not buy a totally passive investment?)

#90 truth hammer on 07.04.12 at 9:16 am

The ‘Canadian Disease’ is killing the taxpayers …..of this there is no doubt. The union/liberal cure for all that ails us is higher taxes?

http://fullcomment.nationalpost.com/2012/07/03/ontario-unions-practice-shooting-themselves-in-the-foot/

Since when do raising taxes to increase the already outrageous pay packets of unionized civic wirkers have anything to do with solving poverty?

The biggest problem today is people not being able to feed their kids and keep a roof over their heads because of the outrageous taxation in this country….not that our unionized civic workers have even more expansive visions of grandeur. There really is no end to union greed or cynicism. Shame on shame on shame that we have such a Canadian Disease.

And the radical left under Mullah Mulcair would have us shut down all sources of revenue from resources so that he can tax Canadians more on behalf of his unions lickspittles? Oh Great Mullah of the Socialist Horde….pray tell……where does money come from?

#91 jess on 07.04.12 at 9:20 am

66 Humpty Dumpty
..the new plague – unemployment
ringfencing the “contagion”
;^)

#92 dd on 07.04.12 at 9:30 am

IMF – US heading for recession:

http://www.telegraph.co.uk/finance/economics/9373240/US-risks-tepid-recovery-turning-into-recession-IMF-warns.html

#93 condopoor on 07.04.12 at 9:49 am

Some of the comments posted to her youtube video are pretty funny…

#94 Hoof-Hearted on 07.04.12 at 9:59 am

Landlording? It has been my experience that 9/10 tenants are great. Its that 1/10 aka the tenant for hell that makes people averse to being landlords.

Funny, that these types seem to know the Tenancy Acts better than lawyers….and will simply jerk you around and milk as much free rent as possible.

I had one that was something else, threatened me..then the Incredible Hulk to over. I cut off power to their place….which made him take off …..he called police (useless) who asked me to put the power back on.

Anyway, the tenant got the message, and I sped up the move out by taking batting practice swings within 10 ft of their moving truck.

#95 Realtors in an all out PANIC! on 07.04.12 at 10:12 am

smokingman #75

Is this idiot for real? It’s obvious you are a very sad out of work realtor as Toronto’s has seen a huge jump in angry MLS dots that are not selling. In fact houses that had sold signs last month are now for sale AGAIN! How could a house that sold last month be for sale AGAIN? With maxed out people unable to borrow more from their HELOC and new mortgage rules kicking in spells housing crash. Reading your posts smokingman it’s obvious you are an out of work uneducated realtor who does’t understand economics. It’s going to be a nasty crash realtor smokingman.

#96 Bottoms_Up on 07.04.12 at 10:19 am

#85 robert james on 07.04.12 at 8:25 am
——————————————–
I love the part where she talks about using your home equity to buy a condo to rent out, and it being like “having a basement tenant without having to live with them”. hahahaha, excellent logic there.

Basement tenant = keep your home equity, collect rent, pay one property tax bill, one maintenance bill etc.

Jackie’s plan = destroy your equity, possibly take on a new mortgage, collect the same rent, pay two property tax bills, two maintenance/condo fees etc.

LOSER.

#97 Bottoms_Up on 07.04.12 at 10:23 am

#74 daystar on 07.04.12 at 5:17 am
————————————-
Interesting take on that, thanks.

#98 Grimbot on 07.04.12 at 10:27 am

Great post Garth! Did you see the piece that made the MSM about Toronto becoming like Manhattan with real estate costs so high that the only thing people will be able to afford in the future is condos? Absolute bull**** and guess who’s flogging the idea? None other than the self-serving Brad Lamb….Toronto’s condo king and the same guy who published that less-than-scrupulous ad in the Calgary market. As always people need to check the source of this kind of tripe rather than just accepting it as ‘true’ because some journalist didn’t bother to do their homework and actually check out the facts.

#99 Grimbot on 07.04.12 at 10:28 am

Looks like the Harper neo-Conbots are making their way onto your blog Garth. truth hammer wouldn’t appear to know truth if it smacked him in the face.

#100 Bottoms_Up on 07.04.12 at 10:33 am

#64 Mr Buyer on 07.04.12 at 2:36 am
—————————————
Prices doubled in Ottawa in a few years? Pass the crack!

Average price was $290K in January of 2009. Today around $360K.

Therefore in 3.5 years the average price has gone up 24%.

Under normal market conditions, the appreciation over 3.5 years could be 10% (taking inflation and wage gains into account).

Therefore, perhaps 14% of recent gains are frothy. That’s a far cry from 100%.

#101 Bottoms_Up on 07.04.12 at 10:34 am

and I’ll post the link again for people that want to see the data:

http://www.cmhc-schl.gc.ca/en/hoficlincl/homain/stda/index.cfm

#102 jess on 07.04.12 at 10:39 am

brazil
http://www.corpwatch.org/article.php?id=15747
“Monsanto gets paid when it sells the seeds,” Jane Berwanger, lawyer for the farmers told MercoPress. “The law gives producers the right to multiply the seeds they buy and nowhere in the world is there a requirement to pay (again)… Producers are in effect paying a private tax on production.”
http://www.prwatch.org/node/11610
=

News
Supreme Court Applies Citizens United to States: Rules for Robber Barons and Copper Kings
by Jonathan Rosenblum — June 26, 2012 – 9:29am
===================
montana law review
http://mtlr.org/?p=542
Once Upon a Time in the West: Citizens United, Caperton, and the War of the Copper Kings
PDF VERSION

By Larry Howell*

#103 John S on 07.04.12 at 10:54 am

Garth, you had said a couple of weeks ago that there is no systemic manipulation of data and markets. What do you call the LIeBOR scandal and JPM $9B trading scam?

http://www.bloomberg.com/news/2012-07-03/jpmorgan-probed-over-potential-power-market-manipulation-1-.html

Actually, I still cannot believe you had said that the markets are not systemically manipulated. Every market is manipulated by vested interests (that includes the FED) including your fav. RE market in Canada.

It’s called fraud. — Garth

#104 Timbo on 07.04.12 at 10:55 am

http://www.vanityfair.com/politics/2012/08/investigating-mitt-romney-offshore-accounts?mbid=social_retweet

“Romney’s personal tax rate is a particular point of interest. In 2010 and 2011, Mitt and Ann paid $6.2 million in federal tax on $42.5 million in income, for an average tax rate just shy of 15 percent, substantially less than what most middle-income Americans pay. Romney manages this low rate because he takes his payments from Bain Capital as investment income, which is taxed at a maximum 15 percent, instead of the 35 percent he would pay on “ordinary” income, such as salaries and wages.”

Now that is capitalism……………………

http://www.bloomberg.com/news/2012-07-04/france-raises-taxes-on-wealthy-companies-to-narrow-budget-gap.html

“The largest new levy will be a one-time surcharge on wealthy individuals’ assets to raise 2.3 billion euros. Another 898 million euros will be reaped by ending a payroll-tax holiday. Other steps include surcharges for oil and financial companies, each raising an additional 550 million euros, and a levy on dividends and stock options. ”

Class warfare or smoke and mirrors?….

#105 Cowtown on 07.04.12 at 11:09 am

Call Jackie Ried for bad advice: 604-880-7343 http://twitter.com/#!/jackiedreid

#106 Weed and Jackie on 07.04.12 at 11:29 am

Apparently, Jackie has been smoking too many of those giant marijuana plants blowing in the wind behind her.

#107 45north on 07.04.12 at 11:35 am

hoof-hearted: I sped up the move out by taking batting practice swings within 10 ft of their moving truck.

not a wise move hoof

my brother-in-law looks scary without the baseball bat

#108 terces on 07.04.12 at 11:39 am

I’m not here to dis apartment ownership, as I made a bunch of money off of it, but here is one other angle you need to consider before investing.

Your net taxable earnings will be taxed as passive investment income, which means the first and every taxable dollar earned will be taxed at your highest marginal income tax rate. The only way around this is if your company owning the buildings has at least 5 full time employees.

Also, when you sell the buildings, what you consider capital gains could very easily be taxed as income – same as above at the worst possible rate. The only way around this is to “retire” and not invest in any more real estate for at least 3 years until your sale becomes “statute barred”.

You are wrong. — Garth

#109 Hoof-Hearted on 07.04.12 at 11:43 am

107 45north on 07.04.12 at 11:35 am

hoof-hearted: I sped up the move out by taking batting practice swings within 10 ft of their moving truck.

not a wise move hoof

my brother-in-law looks scary without the baseball bat

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

You had to be there……but it worked. I didn’t threaten them…just showed I had one and could swing it to do Babe Ruth proud.

#110 futureexpatriate on 07.04.12 at 11:52 am

Ask the lovely Jackie how many condos she’s purchased during “this terrific opportunity”.

#111 T.O. Bubble Boy on 07.04.12 at 11:58 am

HAHAHAHA – house flipping didn’t quite work out as planned:

C2403342 – 135 CHAPLIN CRES, Toronto, Ontario… now $1!!!

Price Changes:
June 4th 2011: $799,000 (bought for a flip, obviously)
May 31st, 2012: $979,000 (one year later, a post-reno attempt at a bidding war)
June 10th: $1,099,000 (hmm… no bites on the bidding war, so increase price by $120k)
June 27th: $1,049,000
July 4th: $1 (attempting to get the last greater fool before 30-yr mortgages dissapear?)

I’ve never seen shenanigans like this before.

#112 DonDWest on 07.04.12 at 12:17 pm

This is the best video I’ve ever witnessed (explaining the Canadian housing bubble):

http://www.youtube.com/watch?v=ti6nPCDnPi8&feature=related

Scary, over 30% of our economy is in housing. We’re screwed.

#113 TRT on 07.04.12 at 12:38 pm

To all the union, teacher, nurses, liquor workers, working-class bashers out there:

France has just instituted a “Wealth Tax”. Not income… but a wealth tax. Imagine if Vancouver did that??? All the gazillionaires with less than $18,000/year incomes will have to make up for their share…and in a hurry.

What you say Garth? Cheer a Wealth Tax??

#114 cramar on 07.04.12 at 12:41 pm

#25 Foggy on 07.03.12 at 10:44 pm

When I early-retired in 2006 my plan was to buy a cheaper, smaller house well away from the GTA. I researched a lot of homes from Chatham up to Kincardine. My budget was $50K up to $150K. There were plenty to be found from fixer-uppers to nice rural homes on big lots. Ultimately the deciding factor was the hot humid Ontario summers, which eliminated the Windsor/Chatham/Leamington area. Soon after prices for all these same places started to rise significantly as they caught the Toronto contagion. So I wound up on the East Coast, where summers are moderate.
But if you don’t wilt in the heat like me, SW Ontario and up the Lake Huron coast is good value for retirees. I remember Lucknow as being a nice little town.

———————-

Hey Foggy, way to go! Two thumbs up!

Funny, six years later nothing has changed much. Your statement, “soon after prices for all these same places started to rise significantly as they caught the Toronto contagion,” could have been true, but it never materialized, or they fell back. The prices now are still not far from what they were six years ago. The problems in 2008-2009 in Windsor has held prices down anywhere west of London. Many in TO have no clue that they could sell out, finance their retirement, and buy in SW Ontario.

A have a bud that lives near the lake outside of Kincardine. It does not get hot where he lives. Sunsets are unbelievable as is the beach! Too bad you didn’t buy there in 2006. Now because of the Bruce Plant, RE has shot up in recent years.

#115 Victor on 07.04.12 at 12:43 pm

Interesting link from Rob Carrick over at the G&M:

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

How to make money while housing burns

A U.S. financial blogger looks at some potential ways to make money on a big drop in the Canadian housing market. Interesting to see Americans looking northward and sizing up our housing market as being vulnerable.

http://seekingalpha.com/article/697261-the-way-to-play-canadian-housing-market-bust

#116 so it begins... on 07.04.12 at 12:52 pm

Victoria prices down 6%

Vancouver sales down -27% y/y, -17% m/m (detached down -37%)
listing up +22% y/y , +4% m/m

sales-to-active-listings ratio sits at 13 per cent, which puts it in the lower end of a balanced market. This ratio has been declining in our market since March when it was 19 per cent

#117 Silver on 07.04.12 at 12:52 pm

… is home equity not the actual value you have paid off…?

and borrowing against an imagined home wealth above the borrowing is that not called debt… ?

when did more “debt” become an improved “Equity” position?

Silver

#118 Market Bull on 07.04.12 at 1:15 pm

“By our estimate, to neutralize the impact on mortgage payments of the amortization rule change, average home prices would need to fall about three per cent. By helping to cool the market now, the rule changes should increase the odds of a soft —rather than hard — landing,” Sal Guatieri, BMO’s senior economist, said.

http://www.cbc.ca/news/business/story/2012/07/04/bmo-survey-mortgage-duration.html

#119 Toronto_CA on 07.04.12 at 1:19 pm

http://www.vancouversun.com/business/commercial-real-estate/Vancouver+sales+year+real+estate+board+declares+buyer+market/6882325/story.html

and

http://business.financialpost.com/2012/07/04/vancouver-home-sales-plunge-to-10-year-low-in-june/

You have to love the Van RE Board’s spin. “Prices appear to be stabilizing base on what the board calls its composite benchmark price index which is up 1.7% over the last year and 0.7% down from May.”

Even the MSN is got a cock eyed look going when it says “what the board calls its composite benchmark price index”. Too bad these people are too lazy to give actual price drops by average and median.

#120 eagle eyes on 07.04.12 at 1:29 pm

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales of detached, attached and apartment properties reached 2,362 in June, a 27.6 per cent decline compared to the 3,262 sales in June 2011 and a 17.2 per cent decline compared to the 2,853 sales in May 2012.

#121 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 1:37 pm

I do not hate the idea of free markets any more than I hate Grimm’s Fairy Tales (which I do not hate, they are nice stories really). If you like to live in fairy tales then enjoy yourself. There has likely never been free markets ever in history (except possibly for brief periods in and around wars and similar upheavals and those free markets are nicely described by the term profiteering).

#278 American Werewolf in BC on 07.03.12 at 11:34 pm
We shouldn’t strive to achieve them because 1) they are unachievable and 2) since they are not achievable, their benefits are not testable hypotheses, and therefore, the notion of their “goodness” is without grounds.
IOW, they are nothing more than a fantasy that children shouldn’t even bother to be bored with.
——-
Mr. Buyer and Mr. Wolf,
The best measure of freedom and free markets is the amount we pay in taxes. So for arguments sake, lets just say in total the average working person pays 50% in taxes.

The glass is half full or the glass is half empty but the glass is not an illusion, that’s just your ability to reason.

So looking at the USA, a country that matters and was founded on freedom and free market principles. And not long ago they had no income tax, no medicare, no medicaid, and no social security and they were prosperous. They had money backed by gold and banks in the business of lending to business. The business of America was business. Busy-ness! Get it.

You claims that there are no such thing as free markets are wrong. At one time, the USA only had excise taxes, meaning only sales taxes, meaning if you didn’t buy certain products it was possible for an American citizen to pay zero taxes.

Now we have,
capital gains tax,
estate tax,
sales tax,
health tax,
income tax,
property tax,

all to pay for government services that should be privatized back to the way it used to be.

#122 Dorf on 07.04.12 at 1:38 pm

Its exciting, its super-good. Translation: I need to pay my rent.

Invest in Apple. Apple is on about stage 4 of a 10 step plan, and it takes too long to explain it all, especially to people who, instead of listening, just constantly think NO because it wasn’t their thought.

So here I am once again being the good friend, availing people of my knowledge and superior technical abilities even though I am not obligated to do so.

So, tell me to shut up or stop talking nonsense, but buy Apple, Telcos, IBM, and Cisco. These are for growth.

Whatever you choose to do, don’t tell me I should have been a better friend….you first.

Remember Nortel? Did you buy FB?

I am not an investor. I own no stocks or investments, I own everything I have, including my cash in the bank.

I am a technical wizard who can’t stand stupid people so I drive a truck instead. Its a beautiful way to live. I get to see so much.

I am still OCD about technology, I have to know everything.
Disregard everything I say and buy FB, Google, and Samsung. Freaks.

#123 tkid on 07.04.12 at 1:44 pm

TRT, the wealth tax you are proposing would crash the real estate market overnight. Those folks can’t afford to pay a tax on wealth that doesn’t really exist. They’d sell, all of them, and the resulting chaos on MLS would ensure that market crashes.

What France has done is drive wealth out of France, both private wealth and commercial wealth. Why pay a 75% tax on what you have worked hard for (if it is your money you are damn sure you worked hard for it notmatter what the opinion of the government and its dependants may be) simply because The State couldn’t get its overtax-and-overspend act together?

Find yourself a nice tax haven that will not hand over banking information to foreign countries, and voila! You are safe and secure on a beach somewhere sipping mai tais. It is terrible what has happened to all of your French workers, but what else could you do but leave?

It isn’t like the conditions in France are so advantageous for businesses that the wealthy could afford to take the tax hit. Last I heard one could get prison time for working over X hours per week! Too much red tape kills businesses, as Ontario will find out sooner or later.

And Germany is equally nuts forking out cash to the rest of bankrupt Europe – in the end they will be lucky to get 50% of their money back.

#124 Dorf on 07.04.12 at 1:45 pm

And hello from a bush camp in Northern Alberta, nowhere near anything, from my truck cab. I am using a mobile Wi-Fi hub and a tablet. This is portability with a 10 inch screen. I have internet anywhere I can get a signal, and I can double my range with a non-sanctioned signal booster. I don’t own a smartphone because I am far sighted.

#125 Devore on 07.04.12 at 1:53 pm

#74 daystar

There are two things I don’t like about this building the way its marketed. The age isn’t given and the sizes of the units aren’t given. The units look small.

Properties like these are bought by professionals. It’s not a box in the sky bought sight unseen after a few seconds deliberation. There will be an engineering report, inspections, multiple visits on site, rent roll and other documentation. It doesn’t matter how small the units are, only how much money they bring in. ICX is just the commercial version of MLS. The seller will already have an information package, amongst other things, because that is what buyers of these types of properties (management companies, REITs) expect.

#126 Shortymac on 07.04.12 at 1:54 pm

Awesome birthday present for me, a cooling of the Real estate market. :) Maybe it’ll come back to sanity and hubby and I can afford a home in 5 years.

Homes in my area are going for 600k-800k (just west of glencarin station in Toronto). Now I know why our landlords are living with Grandma but renting a 3br on a double lot for 1650 plus utilities. They also rent out a condo too.

#127 Kitchenerite on 07.04.12 at 2:07 pm

Very interesting post today. I’m not impressed by all of the people on here slagging off landlording. There’s a big PITA factor, yes, but you’re all missing the point. The comparison is not between not owning rental property and owning rental property, it’s between becoming a “landlord” by buying and renting out a condo that will require additional cash to keep it running and probably lose value, or buying a purpose-built apartment building in an area that has not had a huge run-up in prices, and has positive cash flow from day one. Big difference.

True enough, landlording is not for everyone. But it’s also not rocket science in that you don’t have to wake up every morning, drive an hour to the rocket laboratory to listen to your boss say that rocket production is down and difficult decisions are ahead. I digress: landlording can be a very enjoyable activity, and can be both a lot of hard work and a great opportunity. The main thing is, if you can’t even make the simple decision “should I or should I not buy this condo and effectively subsidize my tenant’s housing expenses?” correctly, then no, landlording is not for you.

#128 Devore on 07.04.12 at 2:13 pm

78 House Horny Housewife

Why is everyone making the business of renting look so easy ? It damned well isn’t.

I don’t see anyone making the business of landlording look easy, except for Jackie “income with no work” Reid. This is what all the amateur and accidental landlords miss; it’s not “passive income”. There is no such thing as passive income. That’s just entitlement attitude talking. You always pay for it. With your time. With your skills. With your lifestyle and convenience. With your nerves and stress and health. With risk (barely anyone adjusts returns for risk, or hedges for fat tail events). You’ll pay for it in future maintenance, depreciation, reduced rents, vacancy, tenant quality.

These types of buildings are bought by professionals. They treat is as a business, not something to dabble in their spare time. These people know ROI, cap rate, amortization, depreciation, maintenance, serviceable life, risk management. They make business decisions.

#129 rembrandt on 07.04.12 at 2:16 pm

Jackie: Passion but NO compassion just endless commissions, a penthouse and a Bentley for the lady!

#130 Not 1st on 07.04.12 at 2:43 pm

Burj Dubai going for same per foot cost as Vancouver and T.O. Hmmm….

http://www.businessinsider.com/dubais-magnificent-burj-khalifa-is-a-complete-flop-with-buyers-2012-7

#131 50% Correction Predictor on 07.04.12 at 2:50 pm

Personally witnessing:

Asking prices have been cut left and right in the supposedly HAM area – Markham and Richmond Hill, GTA

#132 daystar on 07.04.12 at 2:53 pm

#97 Bottoms_Up on 07.04.12 at 10:23 am

Cost me an hours sleep, but I felt compelled. Np.

#78 House Horny Housewife on 07.04.12 at 7:32 am

You make interesting points, but management doesn’t have to be hands on. Most investors of apartment buildings don’t manage them from my experience, building managers have free rents or in some cases depending on unit size, less or more than the price of rent.

Try it from a hands off perspective and price in hired building management so that you don’t have to deal with all the little headaches. I do like you raising some interesting points that come down to the detail of the health and structural integrity of the building itself such as sound issues and little annoyances from plumming to electrical, and smaller maintenance (clean halls, lighting, snow removal, etc). The healthier the building, theoretically the less you will have to pay for management and the increased likelyhood of building managers staying put, plus the possiblity of increasing rents in the future to meet or beat inflation.

What I look for is the way this building is being marketed. Its being sold to a buyer who views it as an investment and what do investors look for? Profit. Positive cashflow, but the numbers the realtor offers are based on variables that change (presently dirt cheap interest rates, 100% occupancy rates, low maintenance and management costs, no hidden capital costs/upgrades, taxes, insurance, unchanged rental rates etc.) and its all as good as it gets in a perfect world but this world is far from perfect and these numbers aren’t reflective of present reality, never mind futures. The numbers the realtor has given here are highly questionable so we’ll have to do our own. All these numbers will change and will this investment be able to stay cash flow positive over the next 25 years? Can, for example, this building stay cash flow positive with 10% interest rates or occupancy rates at 80%? Are present rents too high? If not, can a serious reduction in the offer make it cash flow positive? Lets look at he competition:

http://chatham-kent.kijiji.ca/f-real-estate-apartments-condos-W0QQCatIdZ37

Is $620.00 rent to high against the competition for a 2 bedroom a realtor can’t give the dimensions on? If these units are small….

Again, its the unknowns that kill the investor so you make the unknowns as known as possible, estimate these future variables with a level head and make an offer accordingly. Every other smart investor will do the exact same thing and dummies, yeah, they exist, but they are buying condo’s right now. :)

Ask not so much what is there (variables with numbers that need to be more realistic over a 25 year timeframe) but what isn’t. Is the building run on a boiler system and what is its condition? What are the carpets like? What’s the age of the building, why wasn’t it given? (will insurance skyrocket if this building climbs into an onlder age bracket, we don’t know, we have to know, again, unknowns are a killer)

Apartment sizes, why aren’t they given? The building dimensions aren’t given, how small are these units? Why aren’t there more pictures? What kind of buyer is the realtor trying to reach? The information here is vague meaning the realtor is going to cherry pick the information she wants you to hear over the phone and power sell you in person. Expect this. Take control of the conversation and ask all the information the realtor isn’t providing up front and readers, $998,000 is a starting point? When we dig, I mean, truly dig for the bottom line, it might not make sense at all at $998,000 (I don’t think it does) but it could make sense at $600,000. If someone pays more for it, what did you lose? Nothing ventured, nothing lost right? This building could eventually sell for $550,000 for all we know.

Its present competition for rents:

http://chatham-kent.kijiji.ca/f-real-estate-apartments-condos-W0QQCatIdZ37

Its present competition for other investments if Chatham – Kent works for us:

http://chatham-kent.kijiji.ca/f-real-estate-houses-for-sale-W0QQCatIdZ35

Last but not least, income and occupancy support not just for today but the next 25 years. These numbers are critical. Is Chatham dying or growing….? Anyhow, enough food for thought. A pleasant day, all.

#133 Peter Goesinya on 07.04.12 at 2:59 pm

Jackie Reid’s finest moment.

http://i46.tinypic.com/2aaf3w3.png

#134 Realtors in an all out PANIC! on 07.04.12 at 3:17 pm

Vanvouver has stalled for months now and now Toronto has joined Canada’s housing crash. Realtors are in an all out PANIC! trying to spin while kicking and sreaming that all is well when in fact the market has CRASHED in Vancouver months ago with prices down over 13% and now Toronto has stalled and now in free fall.

http://www.theglobeandmail.com/report-on-business/economy/housing/vancouver-now-a-buyers-market-report-finds/article4389244/comments/

#135 Frank le Skank on 07.04.12 at 3:20 pm

I’ve been sifting through some old articles on Garths website. I was reading the comment section from Garths “Surprise” article from March of last year. Seen a few comments from posters (#30 on 03.30.11 at 11:19 pm ) making the same observations as I’m reading in the most recent comments from Garths blog. People say they are driving around the city seeing all kinds of for sales signs, its a buyers market. I’ve seen some posters make this comment lately and I have to say I strongly disagree with that. Yes, there are for sale signs, no doubt about that, but nothing that would make me say “Holy fuck”, its crash time. Some people are jumping the gun, I think its too early to tell if the new regs will break the camels back. The housing market seems to be more resilient then anyone here predicted. I have to admit that things seem to be coming full circle, MSM is starting to turn, real estate agents are turning, government has turned, seems like its just a matter of time. Will it happen soon? I’m not seeing the for sale signs yet.

#136 IM in C on 07.04.12 at 3:30 pm

http://www.calgaryherald.com/business/real-estate/Calgary+house+sale+activity+sparks+memories+2007/6875505/story.html

What’s most interesting about this article is all the comments. The number of people calling ‘baloney’, and taking the Herald to task for shilling the real estate market.

#137 TNT on 07.04.12 at 3:36 pm

A RE Agent i know who works mainly on the North Shore said that he is leaving Vancouver for greener pa$ture$, Ontario, as are other agents, he said it’s deadsville. The GVREB would call this a BALANCED market move. Over the past 5 months moving companies are relocating many more sellers into rental properties because of the clients awareness of the overpriced Vancouver housing market and their fear of the bubble bursting, and a desire to deleverage from it. The GVREB would call this a TREND. PPPSSSSSTTTTTT.

#138 TorontoBull on 07.04.12 at 3:54 pm

great article in the economist:
http://www.economist.com/node/21557734
to quote: “bond yields reflect expectations of future short rates, among other things, that promise is likely to have lowered them further.”
we are in long term low interest rate environment folks…Garth you got that one wrong!

‘Long term’ is shorter than you think. — Garth

#139 Linda on 07.04.12 at 3:58 pm

If it is so good as investment, I am wondering why the owner is selling?

#140 terces on 07.04.12 at 4:03 pm

I’m not here to dis apartment ownership, as I made a bunch of money off of it, but here is one other angle you need to consider before investing.

Your net taxable earnings will be taxed as passive investment income, which means the first and every taxable dollar earned will be taxed at your highest marginal income tax rate. The only way around this is if your company owning the buildings has at least 5 full time employees.

Also, when you sell the buildings, what you consider capital gains could very easily be taxed as income – same as above at the worst possible rate. The only way around this is to “retire” and not invest in any more real estate for at least 3 years until your sale becomes “statute barred”.

You are wrong. — Garth

Garth I respect your advice. Perhaps you could let me know where I am wrong with the above insight. I paid the top tax consulting firm in Calgary $850 an hour to increase my awareness around this issue and if it is “wrong” I would sure like to know where I am off base.

#141 Timbo on 07.04.12 at 4:04 pm

http://www.huffingtonpost.com/2012/07/04/stockton-bankruptcy_n_1648634.html?utm_hp_ref=business

“The man in charge of the biggest U.S. city ever to file for bankruptcy is clear about the root of the crisis.

It was a decision that gave firefighters full healthcare in retirement starting on Jan. 1, 1996, s aid Bob Deis, the city manager of Stockton, California.

At the time, the move seemed cheaper than giving pay raises s ought by unions, officials involved in the decision said. When other Stockton employees demanded the same healthcare deal in following years, the city agreed.”

Giving full private health care insurance benefits can bankrupt a city? Damn you Tommy Douglas!!!!…..

http://sfgate.bloomberg.com/SFChronicle/Story?docId=1376-M6MMFA6KLVR601-5GTG8UHN5T17RGV5UUCVQN97C4

‘Huge Drop’

“Job losses are mounting as a result of falling demand, as companies seek to reduce costs and prepare for the possibility that worse is to come,” Chris Williamson, chief economist at Markit, said in a statement. “Service-sector companies’ expectations for the year ahead showed one of the largest declines in the history of the survey, pointing to a huge drop in confidence due to the worsening political and economic crises.”

The light at the end of the tunnel just blew it’s horn…….

#142 Mark W on 07.04.12 at 4:19 pm

http://www.news1130.com/news/local/article/379550–vancouver-left-off-list-of-best-cities

It would appear that The Economist Magazine just published a list of the “best” 70 cities in the world to live in and Vancouver is not even on the list.

Now watch all the Kool Aid drinkers in this city have conniption fits all over the place.

The only Canadian city to make the list is Toronto … which should leave the average Toronto hating Vancouverite having a complete heart attack!

This is the chart that measures “liveability” but when the average house here is over one million dollars is it any wonder vAnCoUver is not on the list.

#143 Tony on 07.04.12 at 4:23 pm

Windsor and Edmonton would be two cities where it’s much cheaper to buy a condo than it is to rent it even with nothing down. Century homes out on the east coast would also fall into this category.

#144 robert james on 07.04.12 at 4:29 pm

Hey #96 Bottoms_Up .. When I first looked at Jackie`s vid. ,I am thinking this must be some kind of spoof.. maybe a Rick Mercer job,, then I realized ,IT`S REAL !!! Holy shoot !! If I were a realtor I would be so embarrassed by this azz clown.. Well she is based in Vancouver where everyone probably knows by now there is a “special kind of stupid” when it come to real estate.. Cheers!!

#145 Pete in Barrie on 07.04.12 at 4:33 pm

“F, OSFI & the Ps ”

Sounds like a 70’s Canadian rock band.

On another note, that “realtress” in the video came across so sincere. She seems completely honest, which is the scary part.

#146 Bill Gable on 07.04.12 at 4:45 pm

“Vancouver home sales fell 17.2 per cent from May to June and hit their lowest level in more than a decade, the city’s real estate board said Wednesday, tilting the market in favour of buyers.

The Real Estate Board of Greater Vancouver said there were 2,362 sales in June, down from 2,853 in May and down 27.6 per cent from 3,262 in June 2011.

“Overall conditions have trended in favour of buyers in our marketplace in recent months,” board president Eugen Klein said.
“This means buyers are facing less competition and have more selection to choose from compared to earlier in the year.”

The board said June sales were the lowest total for the month in the region since 2000.

Vancouver has been one of the country’s hottest housing markets, but has shown signs of cooling in recent months.

New listings for detached, attached and apartment properties in the Greater Vancouver region totalled 5,617 in June, down from 6,927 new listings in May and from 5,793 new properties a year ago.

The total number of residential property listings on the board’s MLS service was 18,493, up 3.27 per cent from May and up 22 per cent from this time last year.

Despite the drop in the number of sales, the housing price index for residential properties in Vancouver was still up 1.7 per cent from a year ago.”

> Just like Mr. Turner warned – but did the punters listen?

http://tinyurl.com/84muaum

#147 Canadian Watchdog on 07.04.12 at 5:07 pm

Charts:

Vancouver Benchmark Home Price – Apartment http://postimage.org/image/axoe2v9iz/

Vancouver Benchmark Home Price – Townhouse http://postimage.org/image/76rq6jc0d/

Vancouver Benchmark Home Price – Detached http://postimage.org/image/5p69uz79p/

Vancouver Benchmark Home Price – Composite http://postimage.org/image/72tbcjh59/

And the one that matters for the time being. http://postimage.org/image/s4huy2uoh/

The HPI will not decline by double digits until inventory value is marked down and sold. Best estimate is Q4 into 2013.

#148 bigrider on 07.04.12 at 5:18 pm

http://ca.finance.yahoo.com/blogs/insight/toronto-takes-8th-spot-revamped-liveability-index-161832471.html

Toronto takes 8th spot globally in revamped livability index.

Vancouver not even considered.

Is it possible Garth ,that prices for RE in the GTA are what they are because others around the world realize what we do not.

Just asking..no ‘shots’ at me this time..I am a RE bear after all just questioning the markets resilency.

#149 Tony on 07.04.12 at 5:21 pm

Re: #10 Jeff in Leaside on 07.03.12 at 10:27 pm

Problem is when times get worst and worst like Canada’s future renters skip out on rent and or don’t pay the rent and stay until the court evicts them. If you pay all cash and don’t take out insurance on the inside of the building then you risk someone flooding or burning down the entire complex. An onsite property manager is a total waste of money so you take your chances. I’ve always paid all cash and never taken out insurance on the insides and have been mostly lucky so far. Having guys around like “Rocky” can really get you in trouble if you don’t do things right in the first place.

#150 Mike on 07.04.12 at 5:43 pm

@139 Linda : “If it is so good as investment, I am wondering why the owner is selling?”

Maybe they don’t like being a landlord? Maybe they’re moving? maybe they’re sick? maybe they’re upgrading to a larger building? Maybe it was inheritance? Maybe they’re cashing out?

Just because it’s a good investment for some people, doesn’t mean it’s a good investment for all people.

IMHO, it’s crazy to manage a building hundreds of kilometers from home, so I’m not interested. But I’d buy it if I lived in those parts.

#151 daystar on 07.04.12 at 6:12 pm

#125 Devore on 07.04.12 at 1:53 pm #74 daystar

Properties like these are bought by professionals. – Devoire

Professionals? How do you define that word exactly? Investors and sometimes even your average person buy into multiple family RE. I don’t mean to come down on you so harshly but why do you think this is the topic of the day, so we can listen to you can tell everyone including myself that this is all too much for us lamen to grasp, we’re all in over our heads because we’re not “professionals”? I’ll keep it simple. The word professional means f all to me if the individual can’t accurately price in risk, as all buyers must do if they don’t want to blow it.

Here’s 8 units for $294,000 (was $550,000, a professional blew it apparently) in Chatham-Kent. Why so cheap? Seriously, this sounds sweeter in comparison to the aforementioned but why can I get 8 units (that sound like they have more square footage and appeal) for less than a third of the price for an apartment building with 20 units for a million? Whats missing? Near rail tracks? What is it? (This is something I’m interested in, its worth more time)

http://www.icx.ca/propertyDetails.aspx?propertyId=12130861&PidKey=831353917

“It’s not a box in the sky bought sight unseen after a few seconds deliberation. There will be an engineering report, inspections, multiple visits on site, rent roll and other documentation.” – Devore

Are you suggesting I would buy an apartment building on a few seconds of thought? Lol, is that what are you implying, that I’m too irrational and dumb to not look into the obvious? You really have to rethink how you come across. You could be a touch more careful with what you say and how you say it (yes, I’m once again repeating myself).

“It doesn’t matter how small the units are, only how much money they bring in.” – Devore

…. and the money units bring in are based to some extent on their square footage so yes, Devore, it matters. It matters specifically in assessing rent values and rates of occupancy. How can you assess revenue risk without looking at what the competition offers, especially if vacancy rates in the area climb?

It surprises me that you would say this. Apartments as a rule are cheaper to rent than condo’s or other form of multi family precisely because they have less square footage. When vacancy rates rise in a market throughout a 20 or 30 year timeline and they will depending on the economic environment, demand for apartments wane and can stay unrented unless they are the cheapest on the market and even then… (think Detroit) As a rule, apartments ARE the cheapest on the market precisely because of square footage. When I look at the rent spreads between Garth’s example compared to the examples of competition out there elsewhere like kijiji for example, I can’t say it until I’ve walked through these examples, but the spreads are too close or at par. Again, wth Garth’s example we have to rework the numbers.

“ICX is just the commercial version of MLS. The seller will already have an information package, amongst other things, because that is what buyers of these types of properties (management companies, REITs) expect.” – Devore

Yes and no. Of course realtors have a package with detail Devore, but there is absolutely nothing stopping them from devulging all of the information online. Again, how its marketed matters. The good intel will come without effort, they’ll always put their best foot forward. Here’s an out of town example to compare. Look at the extra information (as well as whats missing). Everything its got going for it will come without effort. The rest… isn’t so rosy and takes a phone call or email that will likely be vague, plus a pitch:

http://passerelle.centris.ca/Redirect2.aspx?CodeDest=SUTTON&NoMls=OU8632278&Source=WWW.ICX.CA&Langue=E

Here’s another apartment building in Chatham. 12 unit, large 2 bedroom (so they say), $519,000. How is it being marketed? Whats the information that is volunteered? What isn’t?

http://www.icx.ca/propertyDetails.aspx?propertyId=11698294&PidKey=-999079493

Here’s an example of square footage and other best foot forward examples (but whats missing?):

http://www.icx.ca/propertyDetails.aspx?propertyId=11650560&PidKey=1735942087

Dude, I’ll speak it plain. Commerial Real estate marketing isn’t reinventing the wheel compared to residential. Realtors aren’t going to sell the negatives, its up to buyers to find them and they’ll overstate the positives just as inexperienced buyers will. Realtors won’t shop or compare for you, inspect, engineer or provide more than is requested unless it can generate a sale and they sure won’t help you assess risk. They don’t work for the buyer, the buyer has to work for his or her self. If you seek the help of “Professionals” (they exist) for a second opinion (thats what it is), they will want their cut and some of them will cost you more than help you because all “some” of these “professionals” are really after IS their cut. Simply put, if you don’t know what to look for on your own, you shouldn’t be a buyer…. until you do but some of it (some could argue all of it) is just plain common sense.

#152 Regan on 07.04.12 at 6:22 pm

I’m very curious where people get their information about the prices of various listings? Please enlighten me. Do you sit on the listings and watch the changes? Is there a site somewhere that tracks it? I know realtors’ have access to this – arbitrage to keep this info hidden, of course, and disadvantage ordinary people in the marketplace. I know you can theoretically go to city hall and check on a property, but that’s hardly effective.
Also, buying a multi-unit is definitely smart. I’ve had trouble finding a decent cash-flow positive one in the time span that I’ve had any capital to invest in one. Many of them are priced based on capital appreciation, or the ones with positive cash-flow are based on theoreticals that don’t take the bad tenants into account.
Perhaps that will change soon. I’ve also noticed that the only people who want to be landlords are older and perhaps many are now feeling too tired for the work. I don’t know anyone under 40 who wants to be a landlord beyond the ‘rent my basement’ approach.

#153 Mr Buyer on 07.04.12 at 6:48 pm

#121 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 1:37 pm
………………………………………………………….
Apples and oranges. I have beaten this dead horse in past comments. Your propaganda is just that. It is off message presently and tiresome. Good luck with your free market baloney. By the way. BUYER BEWARE. THE MARKET HAS TOPPED. NOW IS NOT THE TIME TO BUY A HOUSE. SALES ARE FALLING ACROSS CANADA. DO NOT BE LEFT HOLDING THE BAG. CAN’T FLIP IT, CAN’T AFFORD IT. IT IS DONE.

#154 Mr Buyer on 07.04.12 at 7:02 pm

#118 Market Bull on 07.04.12 at 1:15 pm
“By our estimate, to neutralize the impact on mortgage payments of the amortization rule change, average home prices would need to fall about three per cent. By helping to cool the market now, the rule changes should increase the odds of a soft —rather than hard — landing,” Sal Guatieri, BMO’s senior economist, said.
…………………………………………………………….
How on earth does this increase the odds of a NEVER BEFORE seen soft landing. How does cooling the market (dropping prices) increase these chances. The turning down of the taps controlling free money will somehow convince people that this is the only small and temporary drop in prices that will be seen in the collapse of this huge real estate bubble. This is yet another confidence scheme by yet another huckster. Even if no changes or a million changes are made there comes a point (that we are likely at now) that there are not enough willing buyers to sustain the fevered pace of flipping and prices crash. This is the simple life cycle of a bubble. Market BULL indeed.

#155 VT on 07.04.12 at 7:10 pm

POP!

http://www.theglobeandmail.com/report-on-business/economy/housing/vancouver-now-a-buyers-market-report-finds/article4389244/

#156 Dorf on 07.04.12 at 7:13 pm

#135 Frank…I agree.

Besides, when the bottom does hit, don’t you think it will be a significant amount of time before most people even acknowledge that we are no longer on the way up, let alone have hit bottom anyway ?

MSM will be the last ones in for dinner, and when they report it, people will finally accept it’s validity.

Until then, it’s HELOC and crack for everybody. Party time!

#157 Mr Buyer on 07.04.12 at 7:14 pm

#100 Bottoms_Up on 07.04.12 at 10:33 am
#64 Mr Buyer on 07.04.12 at 2:36 am
—————————————
Prices doubled in Ottawa in a few years? Pass the crack!
……………………………………………………………
You have to forgive my softening mind with advancing years but to be more precise it is something like 8 or ten years. I found an excel spread sheet by CMHC that laid it all out. There was no doubling in wages earned or economic productivity or any multiple to support such a rise in prices. Ottawa will crash as well. An acquaintance has seen his Barhaven SFH go from its 150k purchase (approximately) price to over 300k. Lets put down the pipe and stop minimizing the disjoint in Ottawa.

#158 Mr Buyer on 07.04.12 at 7:20 pm

#90 truth hammer on 07.04.12 at 9:16 am
The ‘Canadian Disease’ is killing the taxpayers …..of this there is no doubt. The union/liberal cure for all that ails us is higher taxes?
………………………………………………………
Did anybody tell you the Conservatives/Reform party is and has been in power for some time now.

#159 Toronto_CA on 07.04.12 at 7:29 pm

“Is it possible Garth ,that prices for RE in the GTA are what they are because others around the world realize what we do not.”

If the prices were being driven up by rich people coming from all over the world to live and work in the GTA, then you could conclude that Toronto being the new BPOE is responsible for the prices being driven up.

However, it is not the cause. That would be cheap, easy credit and people willing to take on record levels of debt lent by banks who are backstopped by the taxpayer. It is not because every millionaire on earth decided Toronto is so amazingly livable that they MUST have a condo on Jarvis.

#160 ts harpoon on 07.04.12 at 7:30 pm

http://badapartmentphotos.tumblr.com/

#161 Nostradamus Le Mad Vlad on 07.04.12 at 7:30 pm


#123 tkid — “What France has done is drive wealth out of France, both private wealth and commercial wealth.” — Interesting that Sarkozy has neatly fled France (first lower link). Wonder what he’s got to hide?
*
Spanish banxters go on trial “Rodrigo Rato is also a former director of the IMF. Do you get it yet? Do you see that they are all crooks? Do you understand that the private central banking system is a criminal plot to enslave and loot the people of the world? wrh.com; Gold Coming back into the system? 0:35 clip Jon Corzine, come in please; Euro Nose Dive; Economic Enema; Barclays, Libor and UK Govt. Whoa baby! TSIHTF now! Fixing Rates Is Bob Diamond still around? Libor lawsuits flying thick and fast; Food Prices Up What else is new? Morgan Stanley and S&P All a bunch of criminal whaknutz.
*
Sarkozy flees France Crooks don’t wait around too long, and Wonder how much he was paid to switch his vote? US Uranium Reserves Russia owns 20%; George Entwhistle “This is a very worrying sign, because Entwistle was named Editor of Newsnight just one day before 9-11, during which BBC announced that World Trade Center Building 7 had collapsed … almost half an hour before it actually happened! Is this just his payoff? Or is a major war-starting false-flag planned for September 18th?” wrh.com, and here; UN’s Agenda 21 somewhat screwed up, but UN Gun Grabbers Obummer doesn’t have to do anything — the UN is stripping rights and civil liberties away, plus Osaka’s Mayor “You have no human rights” (great election campaign); Eureka! Dilbert discovered the Higgs Boson shipwreck, passed it over to his pointy-haired boss who has since let Wally make improvements. Hence, this is fake; Syria “That is not a civil war. That is is an invasion!” wrh.com; Melinda Gates Following Bill’s lead on depop.; Florida Democrats “Obviously, and this is a lesson to us all, all friendship ends at the border with Israel!” wrh.com; Cdns. Protest Sheeple are waking up to what’s going on around them; Obomba and IBM Massive data mining initiative.

#162 Mr Buyer on 07.04.12 at 7:35 pm

Update…my Barhaven acquaintance bought at 164k in 2001 and is currently valued at 308k. That is much longer then a few years but my point still stands.

#163 Devore on 07.04.12 at 7:37 pm

#150 daystar

Not sure what your point it. Yes, multi-units are income investments. They are bought for income. Speculators don’t buy them. Amateurs don’t either. That’s what I mean by “professional”. Professional landlords and property managers. Not Dave down the street because it was a tossup between a 20-unit apartment and a pre-build condo downtown.

For anyone considering buying such a property, the listing is irrelevant. It informs the property is for sale, its location, asking price, and general description such as number of units. Anyone considering buying it will evaluate and treat it as an investment, they won’t be buying it because the granite countertops are a pleasing shade of black. This is not a duplex. This is not an “income suite”. The buyer knows this property requires cashflow because there regular operating and capital costs, because it is an investment, not a place to live in, and the numbers need to make sense.

#164 Timbo on 07.04.12 at 7:42 pm

#151 Regan,

I’m very curious where people get their information about the prices of various listings?

http://www.quickonlinetips.com/archives/2006/04/the-big-google-search-tools-collection/

Try Google alerts. R/E needs listings advertised and the crawlers usually pick up any changes.

#165 Devore on 07.04.12 at 7:49 pm

#150 daystar

And I am not being high and mighty. I am also perfectly aware of the “topic of the day” (like it matters). I am simply responding to the general flavour of your post taking issue with how this property is being marketed. I’m telling you it doesn’t matter. Are there stupid investors? Undoubtedly. Are some professionals not very “professional”? Heck yeah. Do some investors lose money? Of course, there is no sure thing, you take a calculated risk, often you still lose money, but hopefully not your shirt.

#166 Hoof-Hearted on 07.04.12 at 7:54 pm

#137 TNT on 07.04.12 at 3:36 pm

A RE Agent i know who works mainly on the North Shore said that he is leaving Vancouver for greener pa$ture$, Ontario, as are other agents, he said it’s deadsville.
==================================

Lets pass the Hat and send them ALL to Loserville aka Ontario.

#167 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 8:03 pm

#152 Mr Buyer on 07.04.12 at 6:48 pm

#121 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 1:37 pm
………………………………………………………….
Apples and oranges. I have beaten this dead horse in past comments. Your propaganda is just that. It is off message presently and tiresome. Good luck with your free market baloney.
—–
Hahaha, don’t want to argue anymore eh, I don’t blame you, you were losing pretty bad and never said anything of substance. I’m actually surprised you prattled on as long as you did. You and the wolf man.

It’s all over.
http://www.youtube.com/watch?v=cyZTTkMPavE&feature=related

#168 Spiltbongwater on 07.04.12 at 8:12 pm

#147 bigrider on 07.04.12 at 5:18 pm

The three top cities on the EIU’s last liveability list — Melbourne, Vienna and Vancouver — weren’t among the 70 cities evaluated. Vancouver was left out because its population — about 578,000 as of the 2006 census — falls below the new ranking’s cut-off of 750,000 people.

Toronto is a very livable city, providing you don’t get shot.

#169 American Werewolf in BC on 07.04.12 at 8:21 pm

#121 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 1:37 pm
The best measure of freedom and free markets is the amount we pay in taxes.

=====

Why?

Your faith shouldn’t dictate that you can just make things up. There are plenty of examples of states historically that had very low levels of both taxation and freedom (think about states that legalized slavery).

=======

#121 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 1:37 pm
So looking at the USA, a country that matters and was founded on freedom and free market principles. And not long ago they had no income tax, no medicare, no medicaid, and no social security and they were prosperous.

=======

The militia acts of the 18th century mandated that citizens purchase private products (firearms). That is a fine example of regulated market at the very foundation of America. During these times, there was also slavery and religious intolerance. On top of it, these very market conditions invariably led to a political struggle that resulted in a civil war. And you measure freedom and free markets by taxation alone? Come on.

=====

#121 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 1:37 pm
The business of America was business.

=====

The business of America during their foundation was forcing children to work in dangerous factories, indentured servitude, exploiting immigrants, stealing land through force from both Americans and natives, production powered by dirty fuels and pollution, etc. America got ahead by fucking over freedom; by stamping on the pursuit of happiness for millions. That is the bottom line. And during this time, the markets were not “free”, but most often, regulated in such a way that the monopolies could prosper and the little guy couldn’t get a foot in edgewise.

Its clear with your romantic talk of “free markets” (which have not and cannot ever exist in real life) and vitriol hatred against taxation (which you inversely measure “goodness” against, without clear rationale for doing so), that your adherence to these principles is religious. This is akin to Taoism; you are essentially saying if everything happens according to this patters, magical “goodness” (you definition of which) will be imparted upon the world.

Its nonsense. Horseshit. Garbage. Ridiculous. Not worth any further time.

#170 A in Vancouver on 07.04.12 at 8:24 pm

No market can go up forever.
It is TIME!!!

#171 penpal on 07.04.12 at 8:27 pm

@# 118 Market Bull

Why don’t you take a good look at that hack’s record before blindly quoting him. Better yet, track his personal investment record.

To quote a loser like this just shows how little you know about investing, period.

In other words, tuck in your tongue, your ignorance is showing.

#172 Smoking Man on 07.04.12 at 8:35 pm

#95 Realtors in an all out PANIC! on 07.04.12 at 10:12 am

You are one sad little man. LaughingCDN

You say the same shit over and over, on the globe and on hear. No contribution or reflective thought, just the same shpeel over and over.

Well you seem think thick you know what I do, so my turn to profile

You’re about you are about. 5’5″ had perhaps 3 woman tops, 1 was payed for. They never came back for seconds. you live in your mothers basement, jealous of the cat, cause mom loves it more than you. You hate your sister cause she made a killing in real estate, while you are still a moms boy.

You never gambled one nickle in your life, if your best . friends (or only friend) girl friend came on to you, you would do it.

When you see road kill you wish it was you who ran the critter over. So for the hell of it, you run it over again.

You have a demeaning just above min wage job. but you are useless at anything else.

You hate anyone that does not trade their time for wages, just like you. You salivate with envy to anyone with nuts who is self employed.

You are a pathetic parasite who can only feel successes if those around him fail, because you know what ever you do you will always fail

About right

Mr LaughingCDN

Another one like that and you can smoke alone. — Garth

#173 jess on 07.04.12 at 8:38 pm

Does Your Doctor Have a Fake Degree? The Billion-Dollar Industry That Has Sold Over a Million Fake Diplomas
There is a major crisis in the world of higher education: the large and growing number of fake universities and fake degrees.

There are more than 3,300 unrecognized universities, worldwide, many of them outright fakes, selling bachelor’s, master’s, doctorates, law, and medical degrees to anyone willing to pay the price. No nation is immune from the problem.

• One international diploma mill, with offices in Europe and the Middle East and mailing addresses in the United Kingdom, run by Americans, has sold more than 450,000 degrees—bachelor’s, master’s, doctorates, medicine, and law—to clients worldwide, who did nothing more than write a check. Their revenues exceeded US $450,000,000.

http://www.alternet.org/investigations/155864/does_your_doctor_have_a_fake_degree_the_billion-dollar_industry_that_has_sold_over_a_million_fake_diplomas

#174 American Werewolf in BC on 07.04.12 at 8:42 pm

RE: #135 Frank le Skank on 07.04.12 at 3:20 pm

While I partially see where you are coming from, the numbers are in to confirm its a substantial downturn. The biggest key to starting the chain reaction though is public perception. If you take a look at the frequency of bearish articles in the various news outlets, there seems to be a big upswing. Front page on G&M this morning was about Vancouver being a “buyers market” officially. Normally when the media is starting to report it, its too late.

As I’ve said before, this feels exactly like July 2007 when I was down south.

#175 Tony on 07.04.12 at 8:44 pm

Re: #14 Retired Boomer – WI on 07.03.12 at 10:31 pm

You seem to know about holidays and the U.S. markets. The rule of thumb has always been to sell everything and go short one month before election day. I have no long positions in any stocks only short positions. I expect a retest of the ’87 lows in the next couple of years.

#176 Victoria on 07.04.12 at 8:44 pm

I have asked this question before and never got a reply really. Why are the “so-called” wealthy all selling their homes – in Victoria. I can the private client listing service and have never seen so many homes over $1 million – especially $2 and 3 million and above for sale.

Why?

Surely this people do not care if the market goes up or down really if they love their house and the city they live in. Are they as wealthy as we are meant to believe? Are they disappointed with Victoria. Everyone getting a divorce? Everyone dying?

In the last 10 years there were many $2 million plus homes being built for the so-called “masses of rich people that had to just live in Victoria”. One after the other was being built and sold very quickly. I was told by my RE agent that they were “all bringing cash” and we were going to be out of the market etc. etc. blah blah blah.

So again why do they all seem to be selling now?

#177 TNT on 07.04.12 at 9:04 pm

Smoking Mad

#178 Smoking Man on 07.04.12 at 9:21 pm

Another one like that and you can smoke alone. — Garth

withdrawl :)

#179 Gunboat Denier on 07.04.12 at 9:25 pm

141 Mark – just to be clear:

“Mr Lovato only examined 70 cities, rather than the 140
in the EIU’s full ranking—he does have a day job after
all—and in his efforts to choose the biggest and most
geographically diverse places, he excluded the likes of
Melbourne, Vancouver and Vienna, which occupy the top
three slots in the main EIU table.”

#180 Grim Reaper/Crypt Speculator on 07.04.12 at 9:43 pm

Aha I knew we could smoke (no pun intended) Smoking Man out…

Flat beer/women and stale nachos works every time..

Oops I hope he doesn’t see that penny and half -used ciggy butt on the ground…I have the sights lined up…

#181 T.O. Bubble Boy on 07.04.12 at 9:47 pm

@ #151 Regan

I’m very curious where people get their information about the prices of various listings? Please enlighten me. Do you sit on the listings and watch the changes? Is there a site somewhere that tracks it?

For GTA: guava.ca

You can even google the address + “site:guava.ca” and see many historical listings for the same address.

That Chaplin Ave property I posted on earlier is an example… i.e. google “153 Chaplin site:guava.ca”

#182 grantmi on 07.04.12 at 9:53 pm

#174 Tony on 07.04.12 at 8:44 pm

I expect a retest of the ’87 lows in the next couple of years.

What are you talking about Tony… the ’87 lows.

http://stockcharts.com/freecharts/historical/djia1986.html

You think the market is going to go down to 1,738 on the DOW! Are you on Crack or what!!

#183 grantmi on 07.04.12 at 10:06 pm

Ouch!!! That’s going to leave a mark!!

Vancouver sales hit 10-year low, real estate board declares a buyer’s market

According to a board report released Wednesday, sales of houses, townhomes and apartments dropped to 2,362 last month, a 27.6-per-cent decline compared with 3,262 sales in June 2011.

http://bit.ly/Or6e6S

#184 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 10:15 pm

#168 American Werewolf in BC on 07.04.12 at 8:21 pm
You’re a real spin doctor but at least there’s some substance in your retort. And FYI, I’m not a Taoist, I’m a Toeist, that’s where my toe kicks you in the A$$!

Hey, I never said America was perfect but it’s the best example in human history and their constitution is one of the greatest documents ever written to limit the tyranny of a government over the people.

And te level of taxation is indeed a measure of economic freedom, which is what we’ve been talking about. At least I have.

Judging by your last post and obvious frustration and use of foul language you seem to have control issues. Typical control freak socialist mentality. Get a grip.

#185 Mr Buyer on 07.04.12 at 10:28 pm

#166 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 8:03 pm
#152 Mr Buyer on 07.04.12 at 6:48 pm

#121 Blue Monster Lover of Meats and Vegetables on 07.04.12 at 1:37 pm

Hahaha, don’t want to argue anymore eh, I don’t blame you, you were losing pretty bad and never said anything of substance. I’m actually surprised you prattled on as long as you did. You and the wolf man.

It’s all over.
…………………………………………..
LA,LA,LA,LA, I can’t hear you, I can’t hear you, LA,LA,LA,LA

#186 Bill Gable on 07.04.12 at 10:30 pm

Vancouver is a backwater. Full stop. World Class? It’s a city that doesn’t even have a cross town Freeway. It’s horrible to drive in. The climate sucks, unless you are a duck and people here think they are better than ‘normal folks”. Snarky idiots. Nice leased Bimmer, dude. Got a HELOC? Good luck.

Today, walking to visit a very smart investor friend, and I was struck by the number of dumpster divers, “for lease signs”, gaggles of smoking ‘foreign students” in front of dumpy ‘language schools. Drugs were being sold openly on many of the streets.

This town is NOT a place to raise a family. Luckily we sold our Apartment building, and we can move and we are.

STAY AWAY FROM VANCOUVER. Mr. Turner has been telling us the crash is going to be gruesome.

Doesn’t anyone remember 18-21% mortgage rates, when Vancouver crashed in 80-81? Obviously not.

What a mess.

#187 Hoof-Hearted on 07.04.12 at 10:30 pm

And now……something completely different

Fiirrraaaaattttttzzzzzz

#188 cynically on 07.05.12 at 3:33 am

#168 American Werewolf in BC – you said you were down south in 2007. You must have come home with your tail between your legs, you’re so angry with the Yanks. Why don’t you tell us what happened and maybe we can get you some help for that hatred you have. By the way the real reason the US shot ahead of all other countries is that they opened up their immigration at the turn of the 19th century (Ellis Island’s heyday) while Canada, under British rule, limited immigration to mostly Brits and some northern European countries. The Dickensian things you claim they practiced, if true, were the same things going on in Britain so maybe it was the times. The mention of guns was a natural thing for people in the American colonies but certainly not today. The slavery was a terrible mark against them but the owners, the colonists, were Brits who didn’t know better at that time but their ancestors in the 20th century should have but they finally woke up (at least in the northern and western states.

#189 daystar on 07.05.12 at 11:12 am

#165 Devore on 07.04.12 at 7:49 pm

I see you got my point. :) I got yours too bud, catch you on the flip. ;)

#190 daystar on 07.05.12 at 11:17 am

#163 Devore on 07.04.12 at 7:37 pm

I’m not so sure about greeners not buying commercial. I believe some do. Its hard to say what the percentages are, I think it has to do with the entry level and market more than anything. Certainly amateurs aren’t going to buy this:

http://www.theglobeandmail.com/globe-investor/scotiabanks-landmark-toronto-tower-sells-for-record-127-billion/article4209502/

:P

#191 penpal on 07.05.12 at 1:05 pm

@ # 172 Smoking Douche

and Garth

Why do you allow postings such as this?

I am pretty disappointed in your editing skills here, Garth.

Yeah, I know it ups the numbers on your blog, but not deleting such obvious off-topic crassness is a bit much.

#192 Linda on 07.06.12 at 6:14 pm

@139 Linda : “If it is so good as investment, I am wondering why the owner is selling?”

Maybe they don’t like being a landlord? Maybe they’re moving? maybe they’re sick? maybe they’re upgrading to a larger building? Maybe it was inheritance? Maybe they’re cashing out?

Just because it’s a good investment for some people, doesn’t mean it’s a good investment for all people.

Yes…you’re right Mike. Lots of diff. reasons (but I am always suspicious when the deal is too good!)
Anyway, one day I will buy something like that to insure my old days…I am patient…