Danglies

Imagine going to school to study economics, then getting a job where the laws of economics don’t apply. Bummer.

But it looks like Ann-Marie Lurie’s learning to cope, now that she’s the first-ever chief economist at the Calgary Real Estate Board, and after doing time with a commercial real estate brokerage, plus CHMC. Says she: recent reports of an oversexed real estate market aren’t relevant to Cowtown. “It is important to note that the Calgary market has already recorded a correction,” she says. “Our housing market is returning to normal levels of activity, supported by the improvements in our employment sector and rise in migration.”

Just to be accurate, in the first three months of this year 26,910 people moved into Alberta from elsewhere in Canada and 13,514 left. Where will they ever put them all? The average house price in Calgary has inched up by 2.2% in a year, while the number of houses changing hands to the end of June is 11,752, compared with 10,150 last year.

Of course in the first half of the year oil was at triple-digit levels, and now it’s above $80 on a good day. Natural gas is a disaster. Keystone’s dead. And a glacial global economy is likely to keep commodity prices on ice for the next year or two.

Worse, today the 30-year home loan bites the dust. Soon cash-back mortgages will also ride into the sunset. And the borrowing bar for property virgins ratchets higher. This is serious stuff in a city where the average house price is $441,634, since the shorter mortgages alone equate to an interest hike of almost 1%. Let us never forget that Calgary depends on oodles of fresh real estate victims, which explains all those U of C-area condos, plus (of course) Missy Bunny.

However, local realtors pooh-pooh all of this, because fancy Eastern junk like economics does not apply to Calgary, the oil patch or cowboys.

“The Calgary market is trending toward long-term stability,” says head industry guy Bob Jablonski. “Activity levels are consistent with our expectations and are not demonstrating an overheated market. We’ve seen a slight lack of supply in single-family homes, but this is not the case in the broader residential market, including surrounding towns.”

As for price, the average SFH in Calgary is now $489,271, down from $502,000 in May. This is about where prices sat five years ago (the peak was $505,920) when oil was at $72 a can, or 16% below current levels.

So, let’s summarize. Enough new people go to Alberta every year to fill one k.d.lang concert. The province’s key export drivers – oil and gas – are in a commodity-driven funk likely to last years. Real estate affordability drops sharply as of today, and gets worse when new bank regs click in by Thanksgiving. House prices have plateaued below their previous high, a very weak technical signal. And some area realtors hate me (always a sign of moral decay).

But as for economics, relax. I’ll bet Ann-Marie has a Silverado with danglies. What else does a cowgirl need?

Do we have pace left for a plaintiff cry for help, or two? Good.

Hey Garth: My family lives in Coquitlam BC in a 45 year old duplex that was paid off 8-10 years ago. The ol man has roughly 200K saved up and brings in about 100-120K annually after tax. Dad’s an old fashioned hard headed kinda guy who ignored all signs of a housing bubble and thinks its all a load of crap (I’ve directed him to your blog hence the hard headed). Recently the owners of the other half of the duplex have put their side up for sale and after 2 price reductions still no bites. They have brought it down to 430K for a quick sale and pops thinks it would be a great idea to cut out all fees and just outright buy it for 410K directly from the neighbour. He want’s to rent the home for $1300/month which would take care of the mortgage and believes that owning the entire lot instead of just half would open the possibility for someone to buy the property to re build (which almost every home around his has done). Here’s where I’m stuck. A lot of your post’s are directed at young horny first timers making minimal down payments and getting wiped out when the market adjusts very much like the US. My question is, given our financial situation, do you think it would be wise for him and I to take the 200K he has and buy this place? Please let me know cause pops wants to know if i’m gonna commit to this with him ASAP and there is no one’s opinion I would trust more than yours. Pete.

So your father has everything he owns, save for $200,000, in a duplex in Coquitlam and wants to dump the rest into the same building? Is he on something? As you know from this pathetic blog, Petie, Lower Mainland housing is in a death spiral at the moment. Surely this is obvious from the fact nobody wants to buy the other half of his house, and won’t until the price plunges further.

Sticking his savings into the place next door is utter speculation, and the opposite of diversification. And figure it out – spending $400,000 (half of which he doesn’t have) to get back $1,300 a month in rent (probably less than a grand after property taxes) gives the same yield as sticking his wad in the orange guy’s shorts. Plus the income is fully taxable at his marginal rate. He’s be far smarter to buy a mess of bank preferreds and get 5% with a dividend tax credit, no debt and no tenant.

Bad idea. Stay away from your father.

Finally, I have a request for general ridicule, humiliation and suggestive comments from a woman in Toronto who says she wishes to be anonymous. I agree. Over to you.

We were prudent and bought below our means in 2005.  That means not taking the probable $500K mortgage a bank might have given us then…instead holding the line at $300K we bought a $425K l’il house in Willowdale in 2005.   Yes…. we are no more than 1 km south of that mythical $1M+ bung.  Wasn’t my dream ‘hood or my dream house (we are really downtown people) but with a job in Markham I couldn’t justify a 90 minute commute to or from a fugly old house we couldn’t afford to fix without borrowing more money.

Fast forward to 2012 we both work downtown and fear Yonge subway line breakdowns (oh TTC!) while the kid is in daycare in Willowdale.  The house is worth somewhere between $775K and $825K, the mortgage is paid down to $160K.  $300K of real-earned equity + $300K of funny money! The melt may have already begun – a neighbour down the street is trying to private-sell her house for $849K for three weekends now.  Last summer another privately-sold home was snapped up in 10 days for $750K and was the talk of the street.  If only the losing bidders of that $1M bungalow would knock on my door….

So why haven’t we sold yet and moved downtown? We’ve nixed selling-and-buying, because we’d lose $70K in transaction fees just going to a same-priced house and the house we’d really like would cost several 100G’s more.  Ugh.  OK… so sell and rent?  The hubby is reluctant until I can show him something good to move into and finding a 3 br house to rent downtown (where we’d ideally live) for under $2500/mo or even $3500/mo is challenging, to say the least.  It’s like I gotta rent, then sell.  Even I quail at finding a good place to rent for reasonable money.  It’s the cause of a few heated discussions and enough to make a latte-sipping wannabe downtown elite want to run to 905!

Many of my neighbours have done the math and decided to stay and renovate.  If I have to stay for another 5+ years, I’d like to do the same too – rip off the half-storey for a full one and get an 3rd bedroom and a bathroom on the 2nd floor.  Mildly hazardous when I was preggers going to the bathroom at night, and now the kid is nearly old enough to use the toilet not diapers at night.  The reno quote I got today was a stunning $150K, give or take $10K.  $40K more than I expected.  Question for the blog dogs….if the market is melting, do we renovate anyway?  We could afford the increased mortgage, or find some cash to reduce the increased mortgage  (though a faster melt / crash could yield me a much better quote next year!)

OK Garth… unleash the hounds…!

182 comments ↓

#1 Corban on 07.08.12 at 9:00 pm

Was walking past the Riverpointe development on my way to stampede. The developer still hasn’t sold all the units yet and it’s been built for how many years now?

#2 TurnerNation on 07.08.12 at 9:01 pm

The others day, I mentioned how the world is run by a bunch of supra-national entities. And that countries exist only on paper.

Here’s yet another example: our current regime just upped the amount of our hard earned tax dollars being sent to Afghanistan (a corruption-ridden narco state), now totalling 1/2 billion dollars over the next few years.
Supposedly, it’s for “little girls going to school”.
Riiight. What about our own sagging school system, aged textbooks, portable classrooms, and 35-40 pupil class sizes? And they’ve cut CCP age, to boot. Total scam.

They did a grand sell job on us. Why else do you think our news drums Syria et al into our heads each week. It’s total mind control. Sell job on a dark-skinned bogey man coming to get us.

How many person hours must we work – waking at 6am, eating and prepping, kids to school, 1 hour commute, rinse and repeat – in order to generate 1/2 billion in tax dollars for our supra-nation rulers?

Haprer doesn’t work for us. Canada, other than as a global monopoly piece, does not exist. This is why we see almost all soverign “countires” being re-shaped via economic ‘bombs’, bombs, or the rule of law. It’s occuring as we speak. Behind doors 2 and 3?

Scared? Asked yourself, what came of the billions in aid you sent to Haiti. Tell us.

Military men are kept in the dark. Fighter pilots are given their mission, their co-orindates, they do a good job each time, hitting them. They are simply told it’s “the enemy”. Concequences? Hidden from them. They arrive back in Canada and continue their lives. Ho hum. We could be next.

Advice: everything they state, take the 100% reversed meaning to be true. Stops the cognative disonance.

Ps. nice wig, buddy:

http://www.cbc.ca/news/canada/calgary/story/2012/07/08/harper-conservative-barbecue-calgary.html

http://www.cbc.ca/news/canada/story/2012/07/08/afghanistan-canada-aid.html

#3 Babblemaster on 07.08.12 at 9:02 pm

Just an observation. People are never content with what they have.

#4 Not on the boat. on 07.08.12 at 9:03 pm

Going to be an interesting week.. grabbing some popcorn..

#5 qwertty on 07.08.12 at 9:03 pm

furrrrrrrrrrrrrst

#6 Timbo on 07.08.12 at 9:08 pm

http://thetimes-tribune.com/news/scranton-moves-ahead-with-minimum-wage-pay-for-city-workers-despite-injunction-1.1339386

“In defiance of an injunction issued in Lackawanna County Court, hundreds of city employees will open their checks today to find they were paid only minimum wage for their work.

Amid Scranton’s ever-deepening financial crisis, Mayor Chris Doherty said his administration is going forward with a plan to unilaterally slash the pay of 398 workers to the federal minimum of $7.25 an hour with today’s payroll, insisting it is all the city can afford.”

Get your popcorn here……………

http://www.cnbc.com/id/48114565

“Core machinery orders, which help to gauge the strength of capital spending, fell 14.8 percent in May, much more than the median forecast for a 3.3 percent decrease in a Reuters poll, as both manufacturers and service sector companies cut orders.”

The train is slowing down. We need more helicopters…

#7 Ralph Cramdown on 07.08.12 at 9:13 pm

You might find you’re able to get a better contractor for less money if you hold off a year. Then again, maybe not.

#8 tran, Calgary on 07.08.12 at 9:16 pm

I went to the Calgary Stampede on Saturday(July 7). It was highly overrated and pretty expensive. I don’t know what the big fuss is about – I have seen better.

Alberta thrives on oil sands. With crude oil at low $80s, I wonder how low it can gets before new oil sands projects are put on hold, and rentrenchments begin.

#9 joe_blown_away_by_high_housing_prices on 07.08.12 at 9:17 pm

“Dad’s an old fashioned hard headed kinda guy who ignored all signs of a housing bubble and thinks its all a load of crap”

It’s so weird that the old fashioned types are the ones who think real estate goes up forever. “Old fashioned” to me means conservative and prudent and frugal, the total opposite of the old bubble deniers we keep hearing about. If they were old enough they might remember the Great Depression. Of all people, the old folks are the ones with the least excuse for participating in herd bubble mentality. They’re old so they should know better.

#10 TurnerNation on 07.08.12 at 9:19 pm

Willodale: Equity, equity go away. Come back another day.

#11 Piccaso on 07.08.12 at 9:22 pm

Edmonton building permits value rises 66 per cent
July 6, 2012

EDMONTON – The value of building permits issued in the Edmonton census metropolitan area for May soared by nearly 66 per cent, said Statistics Canada Friday.

http://www.edmontonjournal.com/business/Edmonton+building+permits+value+rises+cent/6895615/story.html

#12 Piccaso on 07.08.12 at 9:24 pm

Hoping for oil to bounce back like last year? Don’t hold your breath
July 6, 2012

The trend in crude oil prices through the first half of this year has hewed very closely to the pattern set in 2011 thanks to many parallels in the global economy.

But anybody hoping for oil prices to experience the same bounce back to US$100 a barrel levels seen last year will be left disappointed, new research from TD Economics suggests.

http://www.edmontonjournal.com/business/fp/Hoping+bounce+back+like+last+year+hold+your+breath/6895730/story.html

#13 a prairie dawg on 07.08.12 at 9:26 pm

The delusion continues. Herd not spooked yet.

#14 joe_blown_away_by_high_housing_prices on 07.08.12 at 9:27 pm

“we both work downtown and fear Yonge subway line breakdowns (oh TTC!) while the kid is in daycare in Willowdale.”

The Toronto subway system is so sad and pathetic–a real embarrassment to Canada.

I live in Vancouver and I visit Toronto every few years. I absolutely love Toronto and I think on most scores, Toronto beats Vancouver.

But the Toronto subway cannot beat the Vancouver skytrain. Someone with Vancouver eyes looks at the Toronto subway and thinks, wow this is so old. It looks like something out of Soviet Russia. It looks antiquated, like from a by-gone period in history. By comparison, Vancouver’s trains are sleek and modern looking. There are no drivers as the entire system is automated. You can chat on your cell phone all you like in the underground Canada Line as cell phone receptors line the tunnels. Display boards tell you how long you have to wait for the next train and the destination of the next train. YES, trains have different destinations as lines branch off with spur lines. This is a foreign concept in Toronto. And still people in Toronto feel they have the best transit system in Canada. I’ve debated this with Torontonians til I’m blue in the face. They feel the skytrain is the cheap cousin of a real subway. Let me tell you the Canada Line in Vancouver cost $2 billion–hardly a cheap cousin.

Damn it. I’m starting to sound like a member of the BPOE cult. Don’t get me wrong, Vancouver sucks big time! RE here is going down! Toronto is better in so many ways. The Toronto subway may be old but it has a sort of antique charm to it.

#15 Piccaso on 07.08.12 at 9:27 pm

Edmonton – 30 C

My old stompin grounds is almost as hot as my new stompin grounds in Dallas, well not quite… but close.

#16 george on 07.08.12 at 9:28 pm

During the halcyon upside of the Credit cycle, ever increasing quantities of Credit disburse purchasing power throughout financial and economic systems. The Credit-induced increase in spending supports income growth, consumption, corporate profits, investment, government receipts/expenditures and economic output. Asset inflation is seen as fundamentally driven and, furthermore, as confirmation of the bullish viewpoint. One can say that Credit growth is self-reinforcing – or “recursive.” Importantly, the upside of Credit booms ensures seemingly positive “fundamentals” that validate the system’s financial asset price structures and, more generally, the expansive Credit and financial infrastructure.

http://www.prudentbear.com/index.php/creditbubblebulletinview?art_id=10676

#17 Mark W on 07.08.12 at 9:29 pm

http://www.realtor.ca/propertyDetails.aspx?propertyId=12139515&PidKey=-1156153922

HAM & Champagne & Caviar in Lotusland.

Colour schemes here are a bit off but who cares because HAM will just tear it down and build something like this …. on the same size lot.

http://www.realtor.ca/propertyDetails.aspx?propertyId=12115526&PidKey=-129114778

#18 John on 07.08.12 at 9:29 pm

As far as today’s question….

Amongst so many other gloomy and tedious details emerged terms like “the kid” and “preggers”…from “the wife” herself! Does she realize that if her husband spoke of her she’d be “the wife”?

After reading the scenario I realized that it doesn’t matter what she does. Once again, clinical and de-polarized. What’s the point?

Having said that, it’s yet another clear signal of how( one desexualized decision at a time), “families” ( Toronto’s sacred cow) suck up cheap world ponzi funny money.

Doesn’t what’s actually happening and the big picture count for anything? Why not?

#19 george on 07.08.12 at 9:32 pm

Inflation propaganda infomercial MGM – 1933

http://www.youtube.com/watch?v=JUvm9UgJBtg&feature=youtube_gdata_player

#20 Uh Oh Canada on 07.08.12 at 9:37 pm

One pro against the many cons of a housing bubble pop : At least we can learn to be humble again and stop the entitlement attitude so prevalent today. People can learn to live simpler and be content, like the folks a few generations above us. Sometimes economic hard times can be a good thing- if we learn from it.

#21 kathy on 07.08.12 at 9:42 pm

Dont renovate just yet, wait for the correction and trades/labour will be much cheaper.

#22 Wise guy on 07.08.12 at 9:43 pm

Sell the house and take your profit. Don’t bother with renovations, it will be a nightmare to live in, especially when you start seeing neighbours homes dropping by the week.
My question to you is this, ‘If you are going to rent downtown, why do you have to rent a great big house’? I know you have a young child, but I have never understood why a child equates to the need for a full blown house?

#23 It's about time on 07.08.12 at 9:44 pm

Lady, you talk too much.

#24 Sean on 07.08.12 at 9:45 pm

The lady should definitely sell the place in Willowdale. If she gets 800K, after transaction fees, she will end up with $570K of cash. Invested in preferreds at 5%, not hard to do, this amounts to $2375 a month.

What could I get for that… let’s try this place for $2100: http://toronto.en.craigslist.ca/tor/apa/3126865982.html

Want to spend a little more… for $3000/month try this: http://toronto.en.craigslist.ca/tor/apa/3082666226.html

I am sure you can whine about how difficult it is to find good places to rent, but I can assure there is plenty out there. The situation will only improve as condo prices fall flat and “investors” become desperate to put tenants in the units that they cannot flip.

Best of Luck.

#25 Aaron - Melbourne on 07.08.12 at 9:46 pm

http://theage.domain.com.au/real-estate-news/home-owners-facing-loan-repayment-disaster-20120708-21pkl.html

Kevin Bailey, principal at Shadforth Financial Group, said his warnings three years ago of a ”homegrown subprime crisis”, created in part by inflationary first home buyer incentives, are now playing out. He said the schemes enticed mostly young people, without savings, to borrow heavily and pay a premium for low quality housing in poorly serviced locations.

”Lots of baby boomer parents who have made money out of property gave sage advice to children to pour their money into bricks and mortar because prices double every seven to 10 years,” he said.

”Young people who were sold that lie will find it very difficult to escape and it’s a tragedy.”

”They’ve probably got a couple of kids by now, haven’t had wage increases, utility prices have doubled, the carbon tax is coming in and their costs of living are going up,” he said.

”To top it off, no one is eager to buy their houses, so even if they try to sell out, chances are they’ll be taking a loss and still owe money.”

#26 Connaught Condo on 07.08.12 at 9:47 pm

Here’s what the stats look like since 2006 for condominiums in Connaught (Calgary)…

There has been a correction. Now there is an upswing. Whether it is real or a head fake, who knows…

CREB Community Statistics – Connaught (003) Condominium – Community Stats – Zone C
Jan 2006 Actives: 36 Sales: 40 Listings: 44 AvgSale$: 202,130 Median$: 184,000 AvgDOM: 34
Feb 2006 Actives: 28 Sales: 53 Listings: 60 AvgSale$: 231,361 Median$: 187,000 AvgDOM: 24
Mar 2006 Actives: 19 Sales: 62 Listings: 50 AvgSale$: 233,129 Median$: 219,900 AvgDOM: 18
Apr 2006 Actives: 18 Sales: 44 Listings: 55 AvgSale$: 264,516 Median$: 235,000 AvgDOM: 17
May 2006 Actives: 23 Sales: 52 Listings: 52 AvgSale$: 267,419 Median$: 257,500 AvgDOM: 14
Jun 2006 Actives: 34 Sales: 43 Listings: 69 AvgSale$: 281,818 Median$: 272,500 AvgDOM: 15
Jul 2006 Actives: 54 Sales: 36 Listings: 66 AvgSale$: 290,662 Median$: 282,500 AvgDOM: 18
Aug 2006 Actives: 65 Sales: 38 Listings: 59 AvgSale$: 296,787 Median$: 270,000 AvgDOM: 23
Sep 2006 Actives: 86 Sales: 34 Listings: 72 AvgSale$: 293,841 Median$: 269,500 AvgDOM: 31
Oct 2006 Actives: 94 Sales: 34 Listings: 69 AvgSale$: 352,707 Median$: 285,000 AvgDOM: 30
Nov 2006 Actives: 83 Sales: 46 Listings: 62 AvgSale$: 283,403 Median$: 273,500 AvgDOM: 33
Dec 2006 Actives: 55 Sales: 36 Listings: 23 AvgSale$: 300,363 Median$: 269,000 AvgDOM: 46
YTD 2006 Actives: 55 Sales: 515 Listings: 681 AvgSale$: 269,564 Median$: 254,000 AvgDOM: 25

CREB Community Statistics – Connaught (003) Condominium – Community Stats – Zone C
Jan 2007 Actives: 47 Sales: 53 Listings: 63 AvgSale$: 300,136 Median$: 298,000 AvgDOM: 40
Feb 2007 Actives: 52 Sales: 43 Listings: 56 AvgSale$: 382,158 Median$: 294,000 AvgDOM: 45
Mar 2007 Actives: 71 Sales: 63 Listings: 97 AvgSale$: 322,030 Median$: 298,000 AvgDOM: 28
1st QTR 2007 Actives: 72 Sales: 159 Listings: 216 AvgSale$: 330,993 Median$: 298,000 AvgDOM: 37
Apr 2007 Inventory: 84 Sales: 56 Added: 74 AvgSale$: 351,594 Median$: 345,000 AvgDOM: 26
May 2007 Inventory: 98 Sales: 51 Added: 88 AvgSale$: 346,158 Median$: 330,000 AvgDOM: 25
Jun 2007 Inventory: 96 Sales: 58 Added: 71 AvgSale$: 353,123 Median$: 330,000 AvgDOM: 30
2nd QTR 2007 Inventory: 100 Sales: 169 Added: 238 AvgSale$: 350,870 Median$: 344,000 AvgDOM: 28
Jul 2007 Inventory: 93 Sales: 30 Added: 54 AvgSale$: 337,001 Median$: 321,000 AvgDOM: 36
Aug 2007 Inventory: 109 Sales: 32 Added: 73 AvgSale$: 315,846 Median$: 301,500 AvgDOM: 41
Sep 2007 Inventory: 129 Sales: 28 Added: 83 AvgSale$: 320,457 Median$: 295,000 AvgDOM: 40
3rd QTR 2007 Inventory: 129 Sales: 90 Added: 209 AvgSale$: 324,332 Median$: 302,400 AvgDOM: 39
Oct 2007 Inventory: 122 Sales: 28 Added: 63 AvgSale$: 314,484 Median$: 282,500 AvgDOM: 43
Nov 2007 Inventory: 123 Sales: 26 Added: 44 AvgSale$: 311,736 Median$: 304,900 AvgDOM: 50
Dec 2007 Inventory: 94 Sales: 15 Added: 33 AvgSale$: 293,846 Median$: 302,900 AvgDOM: 45
4th QTR 2007 Inventory: 94 Sales: 78 Added: 141 AvgSale$: 310,298 Median$: 292,000 AvgDOM: 46
YTD 2007 Inventory: 94 Sales: 496 Added: 803 AvgSale$: 333,302 Median$: 305,800 AvgDOM: 36
CREB Community Statistics – Connaught (003) Condominium – Community Stats – Zone C
Jan 2008 Inventory: 130 Sales: 17 Added: 87 AvgSale$: 344,935 Median$: 306,000 AvgDOM: 51
Feb 2008 Inventory: 140 Sales: 30 Added: 61 AvgSale$: 327,800 Median$: 303,000 AvgDOM: 56
March 2008 Inventory: 173 Sales: 23 Added: 95 AvgSale$: 312,573 Median$: 293,000 AvgDOM: 40
1st QTR 2008 Inventory: 171 Sales: 69 Added: 243 AvgSale$: 328,653 Median$: 303,000 AvgDOM: 50
April 2008 Inventory: 195 Sales: 34 Added: 96 Avg Sale$: 315,150 Median $: 295,000 Avg DOM: 38
May 2008 Inventory: 204 Sales: 18 Added: 92 AvgSale$: 331,322 Median$: 333,500 AvgDOM: 52
June 2008 Inventory: 186 Sales: 36 Added: 75 AvgSale$: 334,821 Median$: 313,000 AvgDOM: 59
2nd QTR 2008 Inventory: 186 Sales: 88 Added: 263 AvgSale$: 326,505 Median$: 305,000 AvgDOM: 49
July 2008 Inventory: 173 Sales: 26 Added: 58 AvgSale$: 332,884 Median$: 275,000 AvgDOM: 52
August 2008 Inventory: 170 Sales: 22 Added: 73 AvgSale$: 318,313 Median$: 268,000 AvgDOM: 49
Sept 2008 Inventory: 155 Sales: 20 Added: 50 AvgSale$: 294,089 Median$: 272,000 AvgDOM: 52
3rd QTR 2008 Inventory: 155 Sales: 68 Added: 181 AvgSale$: 316,759 Median$: 272,000 AvgDOM: 51
Oct 2008 Inventory: 185 Sales: 13 Added: 79 AvgSale$: 272,230 Median$: 270,000 AvgDOM: 51
Nov 2008 Inventory: 188 Sales: 12 Added: 70 AvgSale$: 287,900 Median$: 255,000 AvgDOM: 58
Dec 2008 Inventory: 140 Sales: 12 Added: 26 AvgSale$: 282,312 Median$: 252,500 AvgDOM: 59
4th QTR 2008 Inventory: 140 Sales: 37 Added: 175 AvgSale$: 280,582 Median$: 265,000 AvgDOM: 56
YTD 2008 Inventory: 142 Sales: 262 Added: 862 AvgSale$: 318,056 Median$: 293,500 AvgDOM: 51
CREB Community Statistics – Connaught (003) Condominium – Community Stats – Zone C
Jan 2009 Inventory: 129 Sales: 14 Added: 59 AvgSale$: 275,961 Median$: 290,000 AvgDOM: 73
Feb 2009 Inventory: 148 Sales: 17 Added: 56 AvgSale$: 320,697 Median$: 250,000 AvgDOM: 74
March 2009 Inventory: 139 Sales: 27 Added: 56 AvgSale$: 258,972 Median$: 250,000 AvgDOM: 58
1st QTR 2009 Inventory: 139 Sales: 58 Added: 171 AvgSale$: 281,164 Median$: 250,000 AvgDOM: 66
April 2009 Inventory: 136 Sales: 25 Added: 55 AvgSale$: 266,666 Median$: 235,650 AvgDOM: 50
May 2009 Inventory: 124 Sales: 27 Added: 59 AvgSale$: 286,185 Median$: 281,000 AvgDOM: 47
June 2009 Inventory: 109 Sales: 42 Added: 55 AvgSale$: 283,980 Median$: 285,000 AvgDOM: 53
2nd QTR 2009 Inventory: 108 Sales: 94 Added: 168 AvgSale$: 280,008 Median$: 275,000 AvgDOM: 50
July 2009 Inventory: 100 Sales: 49 Added: 60 AvgSale$: 276,291 Median$: 253,000 AvgDOM: 47
Aug 2009 Inventory: 102 Sales: 31 Added: 48 AvgSale$: 290,329 Median$: 274,000 AvgDOM: 37
Sep 2009 Inventory: 110 Sales: 43 Added: 78 AvgSale$: 290,315 Median$: 275,000 AvgDOM: 47
3rd QTR 2009 Inventory: 111 Sales: 123 Added: 185 AvgSale$: 284,732 Median$: 268,000 AvgDOM: 44
Oct 2009 Inventory: 117 Sales: 44 Added: 74 AvgSale$: 334,889 Median$: 278,000 AvgDOM: 44
Nov 2009 Inventory: 99 Sales: 54 Added: 48 AvgSale$: 324,534 Median$: 285,000 AvgDOM: 37
Dec 2009 Inventory: 70 Sales: 33 Added: 28 AvgSale$: 347,981 Median$: 310,000 AvgDOM: 52
4th QTR 2009 Inventory: 70 Sales: 131 Added: 150 AvgSale$: 333,919 Median$: 290,000 AvgDOM: 43
YTD 2009 Inventory: 68 Sales: 406 Added: 674 AvgSale$: 298,999 Median$: 275,000 AvgDOM: 48
CREB Community Statistics – Connaught (003) Condominium – Community Stats – Zone C
Jan 2010 Inventory: 87 Sales: 23 Added: 59 AvgSale$: 297,356 Median$: 280,000 AvgDOM: 39
Feb 2010 Inventory: 111 Sales: 34 Added: 77 AvgSale$: 314,589 Median$: 288,000 AvgDOM: 30
Mar 2010 Inventory: 153 Sales: 38 Added: 103 AvgSale$: 304,849 Median$: 266,500 AvgDOM: 36
1st QTR 2010 Inventory: 153 Sales: 95 Added: 239 AvgSale$: 306,521 Median$: 282,000 AvgDOM: 34
April 2010 Inventory: 157 Sales: 46 Added: 87 AvgSale$: 305,393 Median$: 289,000 AvgDOM: 38
May 2010 Inventory: 175 Sales: 24 Added: 70 AvgSale$: 296,269 Median$: 270,000 AvgDOM: 43
June 2010 Inventory: 167 Sales: 24 Added: 73 AvgSale$: 291,420 Median$: 290,000 AvgDOM: 49
2nd QTR 2010 Inventory: 167 Sales: 94 Added: 230 AvgSale$: 299,496 Median$: 285,000 AvgDOM: 42
July 2010 Inventory: 151 Sales: 17 Added: 58 AvgSale$: 318,335 Median$: 297,500 AvgDOM: 51
Aug 2010 Inventory: 148 Sales: 24 Added: 59 AvgSale$: 313,133 Median$: 310,000 AvgDOM: 43
Sep 2010 Inventory: 143 Sales: 24 Added: 57 AvgSale$: 305,905 Median$: 284,500 AvgDOM: 63
3rd QTR 2010 Inventory: 143 Sales: 65 Added: 174 AvgSale$: 311,825 Median$: 300,000 AvgDOM: 53
Oct 2010 Inventory: 117 Sales: 14 Added: 33 AvgSale$: 313,636 Median$: 329,800 AvgDOM: 88
Nov 2010 Inventory: 110 Sales: 16 Added: 39 AvgSale$: 300,650 Median$:265,000 AvgDOM: 66
Dec 2010 Inventory: 87 Sales: 25 Added: 22 AvgSale$: 299,880 Median$: 245,000 AvgDOM: 71
4th QTR 2010 Inventory: 87 Sales: 55 Added: 95 AvgSale$: 303,605 Median$: 270,000 AvgDOM: 74
YTD 2010 Inventory: 87 Sales: 308 Added: 739 AvgSale$: 305,402 Median$: 285,000 AvgDOM: 47
CREB Community Statistics – Connaught (003) Condominium – Community Stats – Zone C
Jan 2011 Inventory: 88 Sales: 27 Added: 53 AvgSale$: 301,177 Median$: 293,500 AvgDOM: 81
Feb 2011 Inventory: 89 Sales: 38 Added: 59 AvgSale$: 279,157 Median$: 260,500 AvgDOM: 46
Mar 2011 Inventory: 103 Sales: 39 Added: 63 AvgSale$: 285,703 Median$: 260,000 AvgDOM: 47
1st QTR 2011 Inventory: 103 Sales: 103 Added: 176 AvgSale$: 287,448 Median$: 270,000 AvgDOM: 54
Apr 2011 Inventory: 111 Sales: 27 Added: 62 AvgSale$: 286,058 Median$: 257,000 AvgDOM: 50
May 2011 Inventory: 132 Sales: 26 Added: 67 AvgSale$: 320,057 Median$: 308,000 AvgDOM: 43
Jun 2011 Inventory: 108 Sales: 42 Added: 52 AvgSale$: 292,097 Median$: 253,500 AvgDOM: 42
2nd QTR 2011 Inventory: 108 Sales: 95 Added: 181 AvgSale$: 298,033 Median$: 281,000 AvgDOM: 44
Jul 2011 Inventory: 106 Sales: 22 Added: 54 AvgSale$: 293,418 Median$: 269,000 AvgDOM: 58
Aug 2011 Inventory: 114 Sales: 33 Added: 64 AvgSale$: 297,936 Median$: 249,900 AvgDOM: 47
Sep 2011 Inventory: 125 Sales: 27 Added: 64 AvgSale$: 327,220 Median$: 310,100 AvgDOM: 43
3rd QTR 2011 Inventory: 124 Sales: 82 Added: 182 AvgSale$: 306,366 Median$: 275,000 AvgDOM: 48
Oct 2011 Inventory: 122 Sales: 24 Added: 55 AvgSale$: 336,155 Median$: 307,000 AvgDOM: 58
Nov 2011 Inventory: 92 Sales: 42 Added: 36 AvgSale$: 328,420 Median$: 275,000 AvgDOM: 52
Dec 2011 Inventory: 69 Sales: 15 Added: 15 AvgSale$: 305,198 Median$: 280,000 AvgDOM: 55
4th QTR 2011 Inventory: 69 Sales: 81 Added: 106 AvgSale$: 326,411 Median$: 280,000 AvgDOM: 54
YTD 2011 Inventory: 69 Sales: 361 Added: 645 AvgSale$: 303,273 Median$: 280,000 AvgDOM: 50
CREB Community Statistics – Connaught (003) Condominium – Community Stats – Zone C
Jan 2012 Inventory: 85 Sales: 20 Added: 54 AvgSale$: 274,604 Median$: 221,000 AvgDOM: 55
Feb 2012 Inventory: 88 Sales: 35 Added: 51 AvgSale$: 336,642 Median$:245,000 AvgDOM: 47
Mar 2012 Inventory: 87 Sales: 45 Added: 64 AvgSale$: 303,789 Median$: 279,000 AvgDOM: 43
1st QTR 2012 Inventory: 87 Sales: 100 Added: 169 AvgSale$: 309,451 Median$: 268,000 AvgDOM: 47
Apr 2012 Inventory: 89 Sales: 47 Added: 59 AvgSale$: 297,864 Median$: 299,000 AvgDOM: 49
May 2012 Inventory: 94 Sales: 49 Added: 73 AvgSale$: 312,938 Median$: 285,000 AvgDOM: 35
Jun 2012 Inventory: 99 Sales: 31 Added: 50 AvgSale$: 310,416 Median$: 293,000 AvgDOM: 48
2nd QTR 2012 Inventory: 99 Sales: 127 Added: 182 AvgSale$: 306,744 Median$: 290,000 AvgDOM: 43

#27 Stinky the Fish on 07.08.12 at 9:48 pm

Why don’t you renovate yourself a life? Do you have nothing better to do in your life, than fix your sh-t in your house? Man, get out a book and educate yourself or your kids. Did you know that the iron in your body came from super novas more than 14 billion years ago? Doing a renovation doesn’t help the greater good. Do something other than be materialistic and admire at the shiney sh-t in your house. People like you make me want to vomit.

Garth – Today I baked a cake and wrote in sprinkles – “Garth, thanks for all your hard work”. Should’ve taken a picture of it and posted it, but I’ve already eaten the whole cake. Man, I’m a fat bastard.

Back to the discovery channel

#28 Sherwood Park on 07.08.12 at 9:48 pm

The only money you want to be spending on a house when the market is tanking is for maintenance and upkeep. Replace the roof shingles, fix the deck, paint the doors but do not be adding a bathroom, kitchen, or a whole extra floor. Life happens and you could be forced to move for work or family reasons at anytime in the next five years. And if that were to happen, the value of your house, regardless of additions, is only as good as the comparables in your neighborhood. Just because you added 150k to it in 2012 doesn’t imply you will get it back in the future. Especially a future where the storm clouds are building.

Good luck anonymous. I suggest you sleep on it a few nights before signing the LOC at the BMO.

#29 joe on 07.08.12 at 9:49 pm

Believe it or not, I partied with Jen (miss bunny) couple of years ago, she was a complete riot, nice girl ;)

#30 Onemorething on 07.08.12 at 9:50 pm

The RE market Ponzi crew – The MSM+Banksters+GOVN+Realtards+CHMC all prayed on Women for the last 20 years. HSN, flip this, mags dedicated to Kitch & Baths. Men only fueled it by taking loans on what they wanted to counter.

This woman at the Calgary RE Board is a prime example of the worst! She’s not only reliant on the health of the business but any bad news in the ranks gets here ousted! Like her Victoria counterpart, she’s dillusional on purpose.

As for the TO woman, your a mess darling! Look harder to find a rental unit – obviously your not AND sell that house yesterday!

Wow, when stupidity keeps reaching an all time high, you know the turn is SOOOOOO Close!

#31 mark on 07.08.12 at 9:53 pm

They should just change their job title from economist to propagandist.

Any business that relies on spewing nonsense to the public or government employs an economist(s) to baffle them with lies.

#32 Mark W on 07.08.12 at 9:56 pm

Sometimes I have to slap myself in the head.

Then I do some basic math and come back to earth.

I found a really nice condo for sale about one block from where my wife and myself rent an apartment.

Did a bit of number crunching and here is what I came up with.

The difference between the maintenance cost and taxes on this condo are only $194.52 less than what we pay for rent every month.

So this is the effective spread monthly.

The condo is $449,900.

Now divide this with $194.52 and that adds up to 2312.87 months.

Divide this number by 12 and you get a figure of 192.73 years to break even on the rent vs buy comparison.

So the break even would be in the year 2202.

:-)

If there is an error in this math please let me know.

#33 AG Sage on 07.08.12 at 9:58 pm

Anonymous person . . . there is a way of thinking about complex medium to long-term projects that you need to bring to bear here. Sort out your troubles into two piles: things you have to solve and things that will solve themselves. Do not throw resources toward the things that will solve themselves. In your example the two things that will solve themselves over time are the two things you seem heck-bent on diving into and throwing money at right away: to wit: a) Paying excessively to relocate to slightly nicer digs or b) paying excessively to renovate your current digs. After the downturn, the differential between the house you have now and the one you want will be significantly less. And the renovations will get more affordable when contractors are desperate and supplies drop. Plywood in the U.S. dropped to a 1/3 of the previous price between the peak and the bottom, for example. Ditto drywall.

There is no reason to pay top price for either one now, you will kick yourself later. Let time solve half of your troubles.

Given that Canadian banks have no reason to hold foreclosures off the market I have a feeling the Canadian market is going to fall 50% faster than the U.S. one did.

#34 DD on 07.08.12 at 9:58 pm

#8 tran

Alberta thrives on oil sands. With crude oil at low $80s …

Big misconception about oil pricing – Actually most people in he patch like oil around $90 to $100. We know energy prices that are too high kill the economy.

#35 Beach Girl on 07.08.12 at 10:03 pm

Beach Boy (Or certified loon)

Thanks to Beach Girl I am opening a house for unweded mothers. Very profitable plus lost of fun. Real estate investment rock. Thanks again Beach Grany.

_____

You will probably end up babysitting and buying the diapers. Did you say you would have lost the fun. Hit the nail on the head. Scary sharing a home with you.

And, I am not a Granny. Nor do I want to be. Now I have been having to much fun to post. Little kids are annoying and don’t pay their way.

Enjoy the vomit, crap, whining, new teeth, chicken pox. Hope you get it. While your new girlfriends are out dancing the night away. LOL. Oh, thanks loser.

#36 Keeping the Faith on 07.08.12 at 10:03 pm

Hey ‘Calgary’s OK’

…NOT!!!

You should change your moniker to “Calgary SUCKs” just like the other parts of the cool-aid drinking country that represents 70% real estate ownership.

Sorry buddy, you’re going down.

#37 Joe on 07.08.12 at 10:06 pm

Oh and she didn’t mind the rented apt at all ;)

#38 AG Sage on 07.08.12 at 10:10 pm

>#31 mark on 07.08.12 at 9:53 pm

Economists really do believe deeply in their positions. Got into an argument with one just as the u.s. crash was starting. I pointed out that it was clear in 2004 that everyone should have gotten out of bank stocks and I warned my investor siblings of this. He thought I was full of it because that had to have been impossible (very vitriolic too. This is religion). I pointed out that you needed only one piece of information to dissect the entire housing ponzi scheme. Just one. That was: Banks were systematically strongarming appraisers into coming up with the highest possible valuations. Everything else that was wrong could be immediately derived from this one reverse-logical, nutso phenomenon. Everything.

How did I know? In 2004 10,000 U.S. appraisers signed and sent a petition to the Bush administration complaining that banks were blackmailing and blackballing them into raising appraisals. (The Bush administration responded by shrinking the staffing by half of the single office that might have been able to respond, but that’s an aside.)

At any rate, I derived all the other problems with the market down from that one fact for this economist guy. For example: why would banks WANT bad loans? answer: because someone is buying them sight-unseen. Who is doing that? Answer: wall street. Q: Why are they buying them sight unseen? … etc. He stopped arguing and glared instead. Whatever.

#39 Keeping the Faith on 07.08.12 at 10:10 pm

anonymous, why make this so difficult.

Sell and rent is your only solution.
If you value networth and early financial independence.

You have the answer in front of you with all the reasons why, you just have to learn to see the forest through the trees.

… and leave your neighbours, friends and husband (if necessary) behind you. The concerns they have now and their screwed up beliefs will be proven to be IDIOTIC in the next 6 months.

Mark my words.

#40 Peterfromcalgary on 07.08.12 at 10:11 pm

Calgary has been very lucky this last decade. Factors such as rebels in Nigeria, Castro wannabes in Venezuela, war in Iraq, boom in China and Hurricane Katrina caused a huge increase in oil prices.

Well that is done and oil prices are going to return to normal. Not only that but fracking technology means low natural gas prices for the foreseeable future.

I guess we will have to wait for the next combination of geopolitical, economic and weather freakishness for the next boom.

#41 Can it be? on 07.08.12 at 10:11 pm

Pass the popcorn indeed. Some houses have sold before the mortgage changes… Price drops galore! Davisville drops $100000 in a month… Mark ham $100000 below asking accepted. $250000 in two months. Mississauga $50000 in a month easy. Agents at today’s quiet open houses tell me it is indeed a buyers market. We went around basically discussing what we could afford, which incidentally depended on which neighborhood and what size of house we were looking for. No formal offers, but basically for a high end home, we suggested as low as $500000 below asking. We left our contact info if people are interested. So for months that we have been looking, mostly price drops :) happy happy. I’m hoping prices drop down to what they were in the years of 2005 give or take. I think that would be more realistic. Let’s hope that the speculating has come to an end once an for all!

#42 Stupesing in Cabbagetown on 07.08.12 at 10:20 pm

#14 Joe… “And still people in Toronto feel they have the best transit system in Canada”

Are you kidding me? I hear nothing but complaints from neighbours and co-workers about the TTC. It’s a horrible system and the subway is especially bad: overcrowded, inadequate and subject to breakdowns. That’s why I live downtown and ride a bicycle to work (12 minutes by bike vs. 30-45 by TTC and a savings of over $1,000 per year in transit fare).

Which brings me to the anonymous Willowdale woman. Not sure what her question is as her story rambled a bit. However, I suggest she consider the cost of the commute for two, not just financially but also in terms of stress, time and distance from her child. Do you really want to be an hour away if the child is injured or sick? And later, when the child is school-aged, will he or she be home unattended for hours before exhausted parents return? Recipe for trouble. There are some things more important than a fancy house and quality of life is one of them.

#43 Keeping the Faith on 07.08.12 at 10:20 pm

#32 Mark W

This is a joke right?
can you be that dumb?

#44 Van grrl on 07.08.12 at 10:22 pm

#27 Stinky the Fish says:

“Why don’t you renovate yourself a life?”

Beautiful! Love it! Can I use that line? ;0

#45 Bottoms_Up on 07.08.12 at 10:24 pm

#32 Mark W on 07.08.12 at 9:56 pm
—————————————–
no error in your math….flawed logic perhaps…

#46 Fabrega on 07.08.12 at 10:26 pm

#2 Turner Nation

Be aware of the military industrial complex and the banksters.

#47 TaxHaven on 07.08.12 at 10:27 pm

Hmmm….

Banks are willing to pay 5% for money now?

(Wasn’t that 6 or 7% a few months ago?)

Stock returns are negligible – or losing. Bonds are at record high prices and record low yields. Dividend yields are well below 5%. Bank money is being offered at 4% or less. “Interest rates” are below 1%, near zero. Credit spreads are incredibly compressed. And who wants to borrow now anyway?

What are Canadian banks smoking?

They are playing the markets with your money is my bet.

Hint: what happens when there is next-to-no real growth and everyone is reduced to gambling and betting?

#48 Canadian Watchdog on 07.08.12 at 10:34 pm

Renovating is a waste at current market prices for labour, building supplies, furniture, etc. Wait until the market is desperate; then your cash is king with bargaining rights.

#49 NewWorldPartyDotOrg on 07.08.12 at 10:40 pm

The reason the “laws of economics doesn’t apply” is because free-market capitalism is a myth.

Housing is the most manipulated market in the world. The government massively manipulated housing and created the housing bubble. Read explanation:

http://www.newworldparty.org/2011/04/housing-most-manipulated-market-in.html
(Canada’s manipulation is in bottom half)

#50 Grim Reaper/Crypt Speculator on 07.08.12 at 10:40 pm

I don’t care..

Up here in Fjord McMurray…working at Tim Horton’s P/T nets you $250,000 and not even talking about tips.

Mind you . a crawl space rents for $5000 /month…and that’s in the barn.

#51 dm in c on 07.08.12 at 10:44 pm

FFS connaught condo have pity on us with tablets. Summarize or link to a spreadsheet through google docs. No need for that cut & paste.

CREB is full of obfuscation and double speak. Quoted in the RE insert today, about Vancouver, “sharply lower sales of higher priced detached homes have reduced Vancouver’s average price : however after controlling for shifts in the sales mix, the typical price continues to rise moderately”

#52 Stinky on 07.08.12 at 10:51 pm

@vangrl – yes, you may

#53 Tripp on 07.08.12 at 10:52 pm

@ #14 joe_blown_away

“Toronto subway…It looks like something out of Soviet Russia.”

Very wrong analogy. Just Google “Moscow metro”, you will see why.

#54 45north on 07.08.12 at 10:54 pm

a woman in Toronto: I’d like to rip off the half-storey for a full one

Sherwood Park has it right: Life happens and you could be forced to move

I was raised in a story and a half in North York. It was built in 1950, I remember my father throwing coal in the furnace. A neighbour here is Ottawa has added an extra story on a split level. Long story short (pun), the idea of ripping off the half story and adding a full story is dumb.

Joe_blown_away_by_high_housing_prices: old fashioned types are the ones who think real estate goes up forever. If they were old enough they might remember the Great Depression.

I am old enough and young enough to remember 1950. I remember a look I sometimes got, I didn’t know what it was at the time. It was the look of fear – fear of being poor.

#55 Canadian Watchdog on 07.08.12 at 10:54 pm

July 5, 2012: Foundation Mortgage Corporation Bankrupt: http://strategis.ic.gc.ca/eic/site/bsf-osb.nsf/eng/br02889.html

These guys are dropping like flies one after another. See what leverage does? Next…

#56 Netcentric on 07.08.12 at 10:57 pm

Garth you mentioned “new bank regs click in by Thanksgiving” in your post. What new banking regs? Link?

#57 Timbo on 07.08.12 at 11:02 pm

http://www.nytimes.com/2012/07/08/world/europe/icelands-economy-is-mending-amid-europes-malaise.html?_r=2&ref=business

“Analysts attribute the surprising turn of events to a combination of fortuitous decisions and good luck, and caution that the lessons of Iceland’s turnaround are not readily applicable to the larger and more complex economies of Europe.

But during the crisis, the country did many things different from its European counterparts. It let its three largest banks fail, instead of bailing them out. It ensured that domestic depositors got their money back and gave debt relief to struggling homeowners and to businesses facing bankruptcy. ”

Back in business after saying no to ponzi debt schemes
bravo……..

http://www.economonitor.com/blog/2012/07/uk-we-were-the-best-now-were-close-to-the-worst/?utm_source=rss&utm_medium=rss&utm_campaign=uk-we-were-the-best-now-were-close-to-the-worst

“As for QE, the analogy is with adding petrol to a damp bonfire. Eventually it will explode into life and take your eyebrows off. But whether it fires up into growth or inflation is an open question.”

It is hard to start a fire in the pouring rain…………….

#58 Harry Palms on 07.08.12 at 11:04 pm

Stinky the Fish says “Why don’t you renovate yourself a life?…………..”

Post of the week!

Stupesing and others on TTC inadequacy:

This system was last shiny and new in like 1980. With the dollars spent by the TTC we deserve better.

I’m with several others. If my livelihood depended on working downtown, I’d be eyeing modest homes in the core. Preferable to slightly less modest homes on the subway line as Walking beats the shit out of riding any day. Besides anywhere along the subway lines is congested urban living anyway unless you’re uber-wealthy and can build on a large, treed lot wit walls.

TTC = Take The Car/Cab.

#59 Saskatoon-Living on 07.08.12 at 11:08 pm

Talked to my buddy today from Calgary, he bought his house 4 yrs ago and he says the price has remained flat. To all those who think Calgary is safe, check out how many foreclosures there are. My last check was 368 foreclosures!!! Dont’t want to see this anywhere, but people in Canada need a serious reality check and need to stop trying to keep up with the Jones. The street I live on in Saskatoon (Stonebridge area), many of the neighbors don’t have lawns, decks, fences, etc. because all of their money was sunk into the purchase of their house. Like the herd followed on the way up, they will on the way down as well. Saskatoon’s next!!!!

#60 Crash Callaway on 07.08.12 at 11:13 pm

The only thing phonier than real estate in Cowtown is the annual 10 Days of Halloween.
Oh well… could be worse, coulda been the inbred olympics.
Wonder how the realtors are doing with Stampede pulling away the feeble minded from their snares.

#61 TurnerNation on 07.08.12 at 11:16 pm

#18John on 07.08.12 at 9:29 pm

Some interesting observations there. I think all are shell shocked. 2001, 2008 brought pre-ordained attacks. The computer simulation would have predicted its social impact. The computer was correct. All human behavior is already fully known. Choriographed events take care of the rest. Sept 11 was ‘solved’, by Sept 12th’s afternoon.
But I digress.

Shell shocked people, fresh from post secondary brainwashing, grab the soul destroying job, take the $500,000 McMansion’s mortgage debt. Hear the radio commercial’s beckon for a sun soaked destiation. We deserve it! HELOC time.

Family is not longer about family. It’s about keeping up appearences, which today’s letter makes painfully obvious.
Family is now about shopping/consuming/material voyuerism (come visit and see out new granite! Forget gettting to know our kids).

#62 ANONYMOUS on 07.08.12 at 11:26 pm

Don’t worry, HIGH OIL PRICES and HIGH NATURAL GAS PRICES will save the day in Alberta, that’s why so many jobs are being created there and why so many people are running to get jobs there !

I read one guy say that its easy for an uneducated guy to come to Fort Mac and instantly get a job making over $200 K per year !

I have no idea if that kind of pay is true or not, but its sounds really nice to me.

#63 Fabrega on 07.08.12 at 11:39 pm

# TaxHaven
We are there already.

#64 Tony on 07.08.12 at 11:41 pm

All you see in Alberta is signs saying reduced, reduced foreclosed, foreclosed. After two huge property tax increases more will be on the way as oil falls back to the U.S. 35 dollar level. Housing prices will fall and fall and never recover.

#65 TimV on 07.08.12 at 11:47 pm

You can’t afford to buy the house downtown that you want, and you say you can’t easily afford to rent itt either? This seems easy; stay. Sounds like you could hold off on the reno for a couple years yet, though. Who knows, but maybe the downtown house you want might drop in price more than your current place (seems unlikely, but who knows).

#66 james on 07.08.12 at 11:57 pm

#59, where do you find the foreclosures list?

#67 VT on 07.08.12 at 11:58 pm

Most popular comment on an economic piece in the Globe has turned to the topic of our real estate bubble and many seem to be agreeing that we’re toast:

http://www.theglobeandmail.com/report-on-business/summer-of-dread-dashes-recovery-hopes/article4398661/comments/

#68 Craig on 07.09.12 at 12:01 am

#23…..THANK-YOU! Someone had to say it.

#69 Carpe Diem on 07.09.12 at 12:08 am

I remember Economics Honour students I went to school with. Not dumb but not too bright – just average. I guess that’s why most never get it right.

It’s a shame, that they want fame. At any cost and to no ones’ gain.

#70 XKR on 07.09.12 at 12:14 am

Went down the reno path once. It sucks, never again. Do yourself a favour and cash out, save your reno money, sit tight for a year or two, then pounce on something you really want to own.

A bit of a hassle but nothing like fighting contractors, and, by the time its over, it’ll be 200K.

#71 not last on 07.09.12 at 12:22 am

Garth,

Is it possible that outside of the mortgage rule changes and interest rates there are other key factors that effect house prices (rhetorical question); but how important do you think are land restrictions relative to everything else in lets say in Vancouver, and lets say in Calgary? And is there any significant/actual/factual info coming out about these land restrictions?

Here is an argument presented by a fine reporter from the Vancouver Sun:

http://www.vancouversun.com/business/Mortgage+rules+lower+prices/6892475/story.html

I know this is a loaded questions but any input would be appreciated as it is relevant to the discussion.

Cheers

#72 Aussie Roy on 07.09.12 at 12:23 am

Aussie Headlines

ABS last week says “No housing shortage”, this week we are told house prices doubling every 7 to 10 years is a lie. The Aussie myths just keep getting busted.

“Lots of baby boomer parents who have made money out of property gave sage advice to children to pour their money into bricks and mortar because PRICES DOUBLE EVERY SEVEN TO 10 YEARS,” he said.

”Young people who were SOLD THAT LIE will find it very difficult to escape and it’s a tragedy.”

Cases such as this have led some financial experts to warn of a ”depreciation time bomb” of negative equity for home owners

http://theage.domain.com.au/real-estate-news/home-owners-facing-loan-repayment-disaster-20120708-21pkl.html

Prices fall, then rents fall

THE rental market in Tasmania is in free-fall as vacancy rates soar to record levels.

Owners are being forced to slash the price of their rentals to attract tenants as the slow market gives home hunters the luxury of choosing between properties.

http://www.themercury.com.au/article/2012/07/08/344081_tasmania-news.html

Seriously though, why do we insist on bringing up the obvious fact of how ridiculously overpriced Australian housing is? Is it because we want people to buy shares instead of homes? Is it because we rent rather than own and are profoundly bitter and jealous? Or is it because your editor is a self-centered American projecting our American experience on an Australian housing market that we don’t really understand?

http://www.dailyreckoning.com.au/why-an-australian-housing-crash-should-keep-you-up-at-night/2012/06/27/

Based on the recent numbers from the 2011 census, it looks like the glory days of the Australian housing sector are over.

http://www.moneymorning.com.au/20120706/the-australian-housing-shortage-that-never-existed.html

#73 Nostradamus Le Mad Vlad on 07.09.12 at 12:37 am


“Imagine going to school to study economics, then getting a job where the laws of economics don’t apply.”
— combined with —
#2 TurnerNation — “Haprer doesn’t work for us.” /-\ #46 Fabrega — “Be aware of the military industrial complex and the banksters.”
— and topped with —
#6 Timbo — “The train is slowing down.”

If anyone still thinks or believes Harper is an economist, then I’m a young, virile nuclear physicist.

For the father, “Sticking his savings into the place next door is utter speculation . . .” — Suggest he speculate on shares of Enron, Canadian Pacific Airlines and Nortel. Pays great returns.

For the lady, follow #24 Sean’s advice — “Invested in preferreds at 5%, not hard to do, this amounts to $2375 a month.” Which will probably be more than enough to pay the rent, then load up on ETFs in TFSAs to cover other costs involved in having a family.
*

Investors super duper pooper scooper; Bob Diamond and Libor; World Economy banking on disaster, and that’s because TPTB control the economy, so more disasters are profitable to them; The Odd Couple Keynes and Viagra; The EuroTwilight Zone; Marks & Spencer overtaken by Next; Carlyle Group Where are dubya’s dorks? Japan broke by Oct.? Finland By standing up for itself, it is messing up TROE; Ten Most Important Numbers in the word (my investments); China’s Inflation rate down; Bubble Trubble from China and the EZone.
*
Third World America Says so on the headline, and Scientists can’t find jobs; Agenda 21 on a local level; Remember traveling across borders in WW2?

#74 Alberta Ed on 07.09.12 at 12:52 am

CREB’s hired an economist… well, gosh, that must mean all their figures will be true!

#75 Victoria Tea Party on 07.09.12 at 12:57 am

TWILIGHT OF THE GODS: IT’S COMING…TURN ON THE LIGHTS. OH, YOU’VE GOT LIGHTS?!

Of all of Canada’s major cities, to invest in Calgary real estate AT THIS TIME is utter madness.

Consider the following information scrounged this date from various Web-sources around the world. Consider the ramifications for the heart and soul of Canada’s
energy headquarters.

—-First off, pointing a boney finger in the direction of Japan Inc., that false-of-false major so-called economies that still imagines it has a viable future with a debt/GDP ratio nudging at 200 per (freakin’) cent!

Out of that besotted glow’-in-the-dark, cooked books group of bankrupt islands, comes this story of a simple, basic economic mega-disaster that had Asian markets tankin’.

This analysis from Zero Hedge’s “Tyler Durden” :

“Japan Machinery Orders Implode As Global Economy Grinds To A Halt

Japan’s core machinery orders were expected to post a modest -2.6% drop. Instead they had a worse collapse than anything seen in the aftermath of the Fukushima disaster, plunging by a stunning 14.8% .

And the kick in the groin cherry on top was the current account surplus plunged by 62.6%: consensus forecast: -14.5%.

The Japanese economy has once again ground to a halt, only this time it has no earthquake or nuclear explosion to blame. This time it is the entire world’s fault, where demand has collapsed proportionately.

As a reminder the BOJ expanded its QE yet again on April 27 [14]. Must be time for another QE because this time will certainly be different after more than 30 years of failures…on Thursday the BOJ is expected to ease yet again.

As a reminder, the BOJ already buys [15]ETFs, Corporate Bonds, and REITs. What’s left: gold?…”

BTW, Japan imports LNG to replace its nuclear power facilities. But NOW how much LESS gas will be imported and from where? Canada?

—-Second, let’s look in on what columnist Roger Bootle (London Telegraph) has to say about the ongoing other disaster that is downtown Europe and its southern beaches:

“…Throwing yet more (printed QE-style) money at the vulnerable countries and calling this by a fancy name is not an answer.

Just as with the Gold Standard and with Bretton Woods, the system has to break. But doubtless the participants at this week’s (EU) summit will smother themselves in every sort of illusion in order to avoid facing up to that uncomfortable reality.

In the end, market processes will overwhelm them…And that would send these countries into a banking crisis from which the only escape would be euro exit.

I don’t suppose that Götterdämmerung is imminent. In Wagner’s Ring cycle, we have to go through three previous music-dramas to get to the Twilight of the Gods. We are surely past Das Rheingold but the Valkyries are still riding.

There will be more summits and bailouts, more fudge and mudge, and more money poured into a black hole. But the end is approaching inexorably.”

—-Third; we go back to Cow Town, still one of my favourite mega-cities:

Quoting the ever-prescient Sir Garth of Main Street Canada, he quotes Ann-Marie Lurie, chief economist at the Calgary Real Estate Board. It is important to note that the Calgary market has already recorded a correction…Our housing market is returning to normal levels of activity…”

THIS BABE (IN THE WOODS) IS PAID TO YAK NOT TO THINK! We must give her a pass.

Way more than half of Alberta’s energy revenues come from sales of natural gas, whose prices have crapped out pretty much thanks to those hordes of frackers everywhere. So many frackers so few adequate revenues! New customers will be needed to boost future revenues. Where will they come from, Japan, China? Doubtful short-term…

IF NATURE…

were to take her course, the world would be plunged into an economic depression that would scar all of us for eons.

So, what I expect to happen will be more extend and pretend from the usual elitist interest groups including presidents, other heads of governments, banksters, and cranially-challenged economists.

IN SUM: TO SURVIVE, WE STICK WITH THE GLUE GUYS AND FORGET ABOUT LOGIC…MAYBE

That is our primary take away, based on the assumption that Mr. Market remains hog-tied and gagged. I STILL fear that someone will set him free.

Actually, this economic operetta ain’t over, a bunch of fat ladies are warbling in the wings!

Then, Calgary real estate will be having a real fire sale! Like the “Prairie Fire” of the Dirty Thirties?

#76 Vikay on 07.09.12 at 1:05 am

Excellent and practical responses from #28, #33, #54 and #65. Because I had already thought of what #28 had to say about moving (but can’t predict how likely we will have to move) and #65 TimV.’s point is what we’ve defaulted to the past 2 years and will probably keep defaulting to until something changes. Bubbles are as bad for move-up buyers as well as first-timers.

#33 AG Sage’s parsing complex mid-to-long term problems into two groups is a gem…. (and good advice for more than housing). Certainly the easiest thing is to continue to sit and “do nothing” for a while yet longer which is probably what we default to because I doubt the next quote will be better. Smarter still might be to sell and rent, but how many people without bubble gains can afford even $2,500 in rent out of their income?

#54 – 45 North – I want to hear more about the look you got in the 1950s from those who went through the Depression.

Meanwhile, it’s hot as hell in the half-storey this past week and will be chilly before Christmas. (I already maxed out the insulation when we moved in and there isn’t much more to do about it short of the maligned rip-and-redo). Let’s hope the subway doesn’t crap out at rush hour too many times in the next few years, because the new daycare isn’t going to be as forgiving as the current one about being a few minutes late… and it takes an extra 10 minutes to get there, too.

#77 Condo Hawk on 07.09.12 at 1:16 am

Toronto Life magazine – July issue

Titled “Faulty Towers” gives a damning view of the state of Toronto’s condo boom and the shit-ass quality of construction. Those condo boards who dare take legal action against the developer get ‘blacklisted’ by lenders making units a hard sell….so developers are in a win-win situation knowing that buyers aren’t going to complain too loudly for fear the value of their most precious investment could plummet.

Toronto condos built within the last 8-10 yrs are a quality control disaster.

#78 Timbo on 07.09.12 at 1:20 am

http://www.guardian.co.uk/commentisfree/2012/jul/08/american-libor-banking-scandal-us

“It would amount to a rip-off of almost cosmic proportions – trillions of dollars that average people would otherwise have received or saved on their lending and borrowing that have been going to the bankers instead.”

Coming to a theater near you………….

http://whispersfromtheedgeoftherainforest.blogspot.ca/2012/07/sun-post-2-australian-financial-experts.html

“The latest missive from the Land of OZ heralds that Home owners are facing loan repayment disaster. And one has to wonder… is this a preview of what’s to come in the Lower Mainland.”

How true and how sad.

oz link: http://theage.domain.com.au/real-estate-news/home-owners-facing-loan-repayment-disaster-20120708-21pkl.html

#79 Doug in Victoria on 07.09.12 at 1:21 am

“women in Toronto”

You were prudent in 2005. What happened??
You “won” some money at the real estate table and now you’re ready to go “all-in”!!

Reassess the risks. 2008 could have left you in a different financial position had things played out differently. You read this blog, what do you think the future holds?

Ever considered a crazy idea like being debt free, keeping options open, freedom to choose your work, etc.

#80 Calgary's OK on 07.09.12 at 1:25 am

“Keystone’s dead.”

Keystone XL’s first permit approved. Two hurdles remain in $2.3-billion pipeline project.

http://www.montrealgazette.com/business/Keystone+first+permit+approved/6844759/story.html

It is not alive yet, but definitely not dead already. It is going to be quietly build in sections. From now on you probably won’t hear much fuss about it in press until it is going to be fully completed.

#81 Brad in Cowtown on 07.09.12 at 1:37 am

Sour Grapes Mr. Turner.
Some of us told you eons ago that Calgary would be perfectly fine… worst case scenario – prices go sideways in a range and stabilize for awhile which is exactly what is playing out.
We also warned you that rates would NOT be rising any time soon another thing that is playing out. Go ahead with a snide remark but everyone knows you were dead wrong on Calgary and dead wrong on rates going up.

#82 TRT on 07.09.12 at 1:45 am

The Yahoo Mortgage Brokers associations across Canada are up in arms trying to to make it more diffivult than ever to become a mortgage broker. Current mortgage brokers will be grandfathered.

Regulations would inlcude countless additional courses and a 2 year articling program (one more year than lawyers). Then you can become a mortgage broker.

These guys are out to lunch…Anyone with decent high school Math ability can study for 1 week and pass the test. Trust me.

http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2012/07/broker-associations-unite-weigh-agendas.html

#83 Last (the first shall be last) on 07.09.12 at 2:11 am

I like Miss Bunny!!!

#84 Bashful renter on 07.09.12 at 2:17 am

#27 Stinky the Fish on 07.08.12 at 9:48 pm

Hey Stinker, she posted a real estate question on a real estate blog. It’s not like she’s yacking on about renos while the rest of us are discussing existentialism. She never said this was her biggest problem in life. Thanks for the irrelevant grade 8 science fact, that was almost as lame as the syrupy verbal hand job you gave Garth at the end of your post……lame

#85 Dave on 07.09.12 at 2:19 am

In Kelowna this week, there are SOLD signs everywhere! But prices are way down.

#86 Jay Currie on 07.09.12 at 2:46 am

Willowdale gal…one word…paint.

#87 NFN_NLN on 07.09.12 at 2:51 am

Did you know that the iron in your body came from super novas more than 14 billion years ago?

Renovating houses, or smoking too much weed in your basement and pondering the creation of the universe… everyone has their vice I guess.

#88 Humpty Dumpty on 07.09.12 at 3:10 am

Ponzi Economics 101,,,,,

http://kingworldnews.com/kingworldnews/Broadcast/Entries/2012/7/8_Gerald_Celente.html

#89 Yulyyz on 07.09.12 at 3:39 am

To anonymous:
Stay put, and wait a bit longer. Yes, yours will sell for less in the future but you will scoop up something already the size you NEED for less. Forget about the renos on your existing place- too expensive.
While you wait, plan on the next house, location size, layout etc so that you will but something that you can stay in for a long time, not something that you’ll outgrow or decide that there aren’t enough guest bedrooms, or no space for a home office, or yard’s too small for a pool.
Get what you need, and what makes sense for your pocketbook and quality of life, forget about the Jones’. There are still neighbourhoods where people are normal and know each other, talk to each other, look out for each other, help each other-explore, and find them while u wait it out.

#90 Calgary Guy on 07.09.12 at 3:43 am

I have been a follower of this blog for over 4 years and first time poster. As a resident in Calgary myself, I truly fear for many of my friends and acquaintances that have become home owners over the past year. All of them have forgotten how unstable the oil and gas dependent Calgary economy can be. A minor correction in oil and gas pricing can leave them out of the job, wiped out with no income to service debts. With recent changes to maximum amortization period for CMHC insured mortgages, this only makes matters worse. I work in oil and gas myself and fear for what is to come over the next few years.

As an example, one close friend took a 40year loan on a home back in 2007. Today they are 60k underwater and have zero hopes of selling out. The mortgage is up for renewal in the fall. I can’t imagine how many sleepless nights this friend has thinking about how to get past this.

#91 Joyce on 07.09.12 at 6:56 am

There’s nothing wrong w renting. My hubby and I are renting a beautiful 3br home (upstairs suite), near skytrain and bus in Vancouver. We pay the same amount per month as my gf’s condo which is half the size. She had to fork out $1000 last time due to a plumbing prob that was not even from her building.
My bro is against renting bc “I’m throwing money away”. Well no, we’re paying for shelter, convenient location and financial freedom. The money we’ve saved from not purchasing a home allowed us to eat out sometimes and for my hubby buy to his dream car. But what does my bro know, he’s still living w my parents.
My guy friend told me last time, “why would someone be so dumb to be paying for someone else’s mortgage?” And he goes off and purchased a $450k condo located near a sewage. He’s been unemployed since July 2011. Now who’s the dumb one?
Does it matter if you own the home or not? Most likely you wont be living there forever anyways.

#92 Stinky the Fish on 07.09.12 at 7:23 am

@Bashful renter
Ok. The answer is no, don’t do renos. If you can’t figure that out, go back to the Nagorno-Karabakh Republic where you belong. That cake tasted good… the only sad thing about is that we are living in a country where obesity is on the rise and skinny jeans are becoming a fad… I fear your future because you have to look at me.

Garth – you are the only one that let’s me post on their site. I’ve been blocked on all the local newspaper sites. thanks again

I wonder why. — Garth

#93 jerry on 07.09.12 at 7:32 am

Garth!

Maybe “real estate Bob” is suffering from unrequited love ?!

You are Noooo—bodddyyy till some boddyy loves you!
……Dean Martin……

Never mind suing……..flowers, dinner and selected readings from 50 shades is in order…

#94 TurnerNation on 07.09.12 at 8:05 am

Ok my docile Canadians. Question for you. Whose face is on our coins’ back. A Canadian’s or an unelected supra-national leader?

An unelected supra-national leader, an inbred power family holding court over Canada, UK, Australia, Israel, part of africa, Bermuda, and may others.

Now you know why John Baird removed his business card’s reference to Canada. Leaving the crown as his logo. Why they slavish praise England and Israel (crown colonies).
It’s all out in the open. If you care to look.

#95 TurnerNation on 07.09.12 at 8:20 am

Oil woes:

Post/wire say Pengrowth cuts dividend 43%

The Financial Post reports in its Saturday edition Pengrowth Energy cut its monthly dividend by 43 per cent to four cents on weak oil and gas prices, its first cut since November, 2009. A Reuters dispatch to the Post says West Texas Intermediate crude and Brent crude have both fallen about 25 per cent since their February highs. “The reduction of the dividend, in conjunction with the capital expenditure reduction and our ongoing hedging programs, should enhance our financial flexibility and provide us with ‘dry powder,'”

#96 Harry Palms on 07.09.12 at 8:22 am

#70 XKR on 07.09.12 at 12:14 am
Went down the reno path once. It sucks, never again…………nothing like fighting contractors, and, by the time its over, it’ll be 200K.

Lots of truth to this. 30% overrun in a medium sized, one-off reno job is nothing to be too surprised about.

http://blog.dsientertainment.com/Portals/84617/images/contract_change_order.jpg

The first budget number is based on a hypothetical best case that has yet to actually happen anywhere.

It’s quoted with the information at hand, i.e. before they start tearing walls apart and stumbling on “unforseen pre-existing conditions”.

Enter a reno contract with caution.

My gut says if you can’t live where you are without minor touch ups, it’s time to shop for a place that you can live in.

Let someone else deal with the headaches/delays/ costs.

#97 Regan on 07.09.12 at 8:24 am

Dear woman in Toronto,
Just because you can, doesn’t mean you should. And, just because you got your house on a half off sale doesn’t mean anything if you don’t actually want it. So why on earth plan to renovate it?
Locate your work and your husband’s work on a map. Find a place to live in between them, and you will live happily with more free time and more family time. Can’t afford to? Then re-evaluate your jobs because, seriously, are you saying you can’t afford to live where you work? Get different jobs or get the same ones someplace else. It’s this problem that needs your renovating attention, not a house you don’t want anyway.

#98 bigrider on 07.09.12 at 8:54 am

The only people who think 416’ers are “elites” are the 416 ers themselves.

905 ers , and everyone else in other area codes, always have a laugh at these people.

#99 live within your means on 07.09.12 at 9:00 am

#48 Canadian Watchdog on 07.08.12 at 10:34 pm
Renovating is a waste at current market prices for labour, building supplies, furniture, etc. Wait until the market is desperate; then your cash is king with bargaining rights.
………………

Depends on where you live, who you know and what skills you have to offer in order to barter.

#100 Michelle on 07.09.12 at 9:21 am

I had to share this with the blog dogs :)

Psalm 2009 — FIRST BOOK OF GOVERNMENT

McGinty is the shepherd I did not want.

He leadeth me beside the still factories.

He restoreth my faith in the Conservative party..

He guideth me in the path of unemployment for his party’s sake.

Yea, though I walk through the valley of the bread line,

I shall fear no hunger, for his bailouts are with me.

He has anointed my income with taxes, ..,.,,HST being the latest

My expenses runneth over.

Surely, poverty and hard living will follow me all the days of my life,

And I will live in a mortgaged home forever.

I am glad I am Canadian

I am glad that I am free.

But I wish I was a dog …

And McGinty was a tree.

Amen.

#101 Dupcheck on 07.09.12 at 9:23 am

The Vanpoover story, tell you dad to hold off of buying the property next door. Give it more time and what do u know you might just save another 100K on it within 6 months. Also tell him now matter what he does, put aside 100K for yourself and never touch it, it is his retirement money. Do not play games with the retirement money, unless you promise to take care of him as long as he is alive.

#102 House Horny Housewife on 07.09.12 at 9:36 am

Hi Anonymous,

Sounds like you are not too happy in the house that you are in presently. This means that spending all of that money renovating might be disappointing because you will be spending a lot of cash and the place may still not be what you are looking for in a place.

You also said that you and your husband are “downtown people” so it sounds like you would prefer to be in a downtown neighbourhood.

I think that, money aside, you need to start there. LOCATION ! Where exactly do you want to live ? Where would you be happy ? Look at the downtown areas that you really like first and target at least three areas. Look at EVERYTHING: daycare accessibility, your nearest bus stop or subway line, grocery store, the colour of the sideway … EVERYTHING.

From there, take a look at what apartments are available and what houses or condos are available. Go visit if you wish but don’t choose (as tempting as it is). Once you have all of your options lined up, then you can look at them all and try to make a decision.

Some options might be to rent a nice place (say a large condo) until the price of a nice condominium or house comes down in price (more likely with the condo) .. meaning you won’t be renting forever. While you are renting, you watch the market and get to know it intimately until you know what it is going to do before it does it. Then you will be ready when that deal comes around .. you will recognize it and go for it, keeping your budget in mind etc.. (thread wisely).

In the meantime, your money from your sale will be earning an OK return and you will be even better able to buy comfortably in the future.

Oh and 300K funny money ? … be smart and invest this for your future. Take a nice vacation for $10,000.00 or something and put the rest away.

You cannot base your decision only on dollars and cents but also on what you want to do and where you want to be. Otherwise, you will be unhappy forever.

HHHW

#103 Yuus bin Haad on 07.09.12 at 10:01 am

For Anonymous from Willowdale: Garth’s no fun – ask Suze – she’ll OK it.

#104 Tom from Mississauga on 07.09.12 at 10:03 am

Hi Woman in Toronto

That commute to work and daycare dropoff and pickup must be exhausting. I argue when I’m tired too. Well described problem. To this I would say to list and find a buyer. 2 things to remember, you need to now find somebody with over 200,000 gross income to finance buying your place. This may take a while particuliarly if listings jump and the economy doesn’t grow. Also I hear most people in the that income bracket already have a property. Second, oceans of time to find a rental still. Once you find your buyer you still have 60 days (lets say)to close in which to find an appropriate rental. PS will your neighbours qualify for the HELOC they need to do the reno they spoke of?

#105 truth hammer on 07.09.12 at 10:05 am

C’mon….Dad ‘nets’ 100K plus….has only $200 saved and needs to mortgage ‘the other side’? Someone has their story a bit screwed up.

The only way this makes sense is if the ‘Dad’ is a civil servant and doesn’t save a dime because he has a huge tax payer funded pension to come…….and drinks the rest away…………..par for the course in the dumb and dumber civil service.

#106 live within your means on 07.09.12 at 10:23 am

On a lighter note – I cut some peony buds (just when they were showing their colours & put them in a baggie in the fridge 2+ weeks ago). I brought them out a day or 2 before our big family BBQ yesterday & they bloomed. I used to do this years ago too. They smell wonderful & no ants :-)

#107 jim on 07.09.12 at 10:37 am

In north york there are for sale signs everywhere as nothin is selling and prices are down by 80-100K in some areas. Open houses on every seond street and I didn’t see any buyers. Never seen so many empty open houses before. It seems like the end of the bubble and the start of the drop.

#108 Daisy Mae on 07.09.12 at 10:38 am

48Canadian Watchdog on 07.08.12 at 10:34 pm
“Renovating is a waste at current market prices for labour, building supplies, furniture, etc. Wait until the market is desperate; then your cash is king with bargaining rights.”

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

Totally agree. The price of virtually everything will have to come down…..that is, if retailers want to stay in business. Consumers have the power.

#109 jim on 07.09.12 at 10:45 am

#55 Canadian Watchdog on 07.08.12 at 10:54 pm July 5, 2012: Foundation Mortgage Corporation Bankrupt: http://strategis.ic.gc.ca/eic/site/bsf-osb.nsf/eng/br02889.html

These guys are dropping like flies one after another. See what leverage does? Next…
———————————————————-

Great job Canadian Watchdog it does seems this housing bubble/crash is looking very US bubble/crash like. I think Canadians and Canada are in even worse finnancial shape. Alot of business owers have been seen a drop in biz the past three months but this drop has accelerated the past mouth.

#110 joe_blown_away_by_high_housing_costs on 07.09.12 at 10:47 am

@45North: “I am old enough and young enough to remember 1950. I remember a look I sometimes got, I didn’t know what it was at the time. It was the look of fear – fear of being poor.”

Strange you should metion that because I think I may have started to notice this in the Vancouver area recently, although I’m not sure. I work with the public in Richmond, an area that’s being hit hard by the real estate crash. I noticed this weekend a lot of people with grim looks on their faces. These people should be smiling because, after 10 months of rain, the sun is shining and weather here is brilliant. No matter how hard I tried, I couldn’t get people to smile. It was noticeably different than prior weekends. I couldn’t figure out why people looked so grim and talked so quietly. They didn’t look sad or mad, just downtrodden and beaten and resigned. Then it occured to me, oh the sheeple are starting to wake up, they know the real estate party is over big time, especially with the mortgage changes coming on Monday.

#111 tkid on 07.09.12 at 11:10 am

Dear Woman-in-Toronto,

are you nuts? Sell and rent. If the house needs a reno to be presentable/liveable in, it will be darn hard to sell the place during a downturn. Drop your price $100,000 to make the place appealing to nervous buyers, and once it is sold, rent for awhile. And you can rent anywhere – two bed condo, house, even hoof it out to the burbs if the desire takes you in that direction.

At the very least take the reno off your list of to-do’s, at least until you have retired the mortgage.

#112 Wetcoaster on 07.09.12 at 11:30 am

Reduced demand for housing results in overstock of housing materials. Pricing for materials will reduce for developers and new construction can be built at lower cost and still maintain profit. Peak buyers will have to compete will their higher priced pre-occupied homes.
I don’t see this as good for resales.

#113 bubble head on 07.09.12 at 11:43 am

Anonymous Woman-

Stay were you are. $160K mortgage thats about 850 + property tax = 1250 a month. If you were to rent downtown – $3000 a month. Remember you would still have to pay for utilities were ever you stay.

If real estate goes down %15 (like Garth predicted a few days ago) – selling your home will cost you 5%, buying another in T.O – 5% – you only save 5%.

If you want to sell and rent, then rent where its CHEAP.

And by the way would people Stop with the “sell your home and rent and invest your money in preferred shares and bla, bla, bla, WE get it. Garth has been saying that for a while. If they emailed Garth they probably read his blog and if they read his blog they know that strategy.

#114 Toronto_CA on 07.09.12 at 11:46 am

Happy July 9th everyone.

Funny with the headline “Almost half of Canadians don’t know new mortgage rules “, the reaction is “so what, who cares, half of Canadians don’t need to know, etc.”

And to a large extent they are right. But if these mortgage rules do prick the housing bubble, then I think more Canadians are going to find out about the changes to the mortgage rules…

And to the TTC, I think it’s horrible as a non-user (I walk to work, 2 minute commute); I’ve never heard anyone singing its praises who lives here and uses it regularly. The less said about the union protected lazy surly TTC staff, regularly caught sleeping/texting-and-driving/doing stupid things the better. It really should receive Provincial and Federal funding like the mass transit in other major centers.

#115 CMM on 07.09.12 at 11:57 am

RE: cost of renting a home in downtown Toronto – my husband and I have rented 2 detached 3-bedroom homes in the 416 in the past five years for $2500/month each. One (fully renovated) was near Broadview station and the other is at Royal York subway. The tricky thing is that newly renovated homes often come onto the rental market with very short notice – as soon as the renos are complete, the owner puts the property on the market for immediate occupancy. It makes planning in advance difficult unless you are willing to “eat” one or two months’ rent while you are still living in your current residence. At any rate, there is definitely no shortage of decent homes for $3000/mo and under.

#116 Toronto_CA on 07.09.12 at 12:07 pm

http://www.theglobeandmail.com/globe-investor/housing-bubbles-messy-and-unpredictable/article4399058/

Wow. This is one of the first bubble articles at the G&M I actually thought was well written. It is like something I would have written.

#117 disciple on 07.09.12 at 12:18 pm

Dangle. That’s what I want to do. Dangle something like what Steve Carell is doing in Tasmania and Iraq. How does he find the time? Ayn Rand post is up…

#118 Nuke on 07.09.12 at 12:37 pm

You certainly should consider renting in toronto. we got a three bedroom th on a quiet downtown toronto street for about $1,000 per month almost 20 years ago. It’s now $1,200. The neighbours homes are about $800k to $1.4mil, we are very happy with our arrangment.

it enabled the kids to grow up in a nice neighbourhood. we don’t need a car, i walk 10 minutes to bay street.

Choosing work to meet our modest household expenses means we can travel now (6 weeks vacation); fully funded retirement and time to fish, sail, cycle, paddle and enjoy the good parts of Toronto restaurants, galleries and entertainment.

The opportunity cost of choosing to buy a house in downtown TO is just to much for my family, but 99% of my friends do own and have a lot of paper appreciation tied up in 50 year old bricks and mortar. They certainly will have a completely different take. That’s perfectly fine.

Rent or own is a simple choice and should always be presented as just that.

#119 daystar on 07.09.12 at 12:37 pm

Good morning, Pete.

There might be a development angle there but we just don’t have enough information to go with. We need to know what RE is going for within a 10 block radius to know and even then, its a falling market. What is he thinking, 4 plex, has he worked out construction costs and shaved 20 to 40% off of today’s values, does he have a lot large enough to work with? Otherwise, I don’t see the angle.

http://www.ratesupermarket.ca/mortgage/rate_calculator_results_breakdown/?house_value=430000&deposit_type=percentage&deposit=45&mortgage_rate=5.000&amortization_period=25&lumpsum_payment=&num_years=&mortgage_amount=256000&payment_type=monthly

I’ve got monthly mortgage payments at $1375.50 to buy the house at $430,000 with 45% down at 5%. Even with a mortgage reduced to $256,000, it costs more to own than rent.

If the ol’ man bought in at $430,000 and put his entire savings down, he would be broke and cash flow negative with the risk of bad tenants and falling RE values messing with his head. Can’t he find something better to do with his money? Why would you break yourself to go cash negative in a declining RE market? Unless there’s a development angle, this makes no sense to me. If he’s really horny and can’t get past RE next door tell him that the one buyer that will be most interested in this duplex more than anyone will be the owner next door. Who else owns? Just him. He’s competing with himself in terms of a development angle. Price it in. Tell him its not what you pay for it today, its what this is worth listed on the market 3, 5 and 7 years from now that counts and I’m thinking it’ll be priced at a “quick sale” 3, 5, 7 years from now for $100,000 less than it’s worth today so why would you take a bath to be cash flow negative? It makes no sense.

Hi anonymous.

List it and sell it already! It sounds like you are trying to rent in an area where houses are flipping for a mil or more and condos are close… correct? Help me to understand this, you want to rent in a desired location to shave off commute time and neither of you have factored in the cost to own?
http://www.ratesupermarket.ca/mortgage/rate_calculator_results_breakdown/?house_value=1%2C000000&deposit_type=percentage&deposit=10&mortgage_rate=4.000&amortization_period=25&lumpsum_payment=&num_years=&mortgage_amount=256000&payment_type=monthly

(I gotta start using tiny url’s) A million dollar mortgage with 10% down at 4% will cost you $4700.00 in payments. (by the way, at 8% it costs $6900.00)

Bump your rental rate to 4 G’s, its still cheaper than owning and then start factoring in what $600 G’s will generate in income. (an ultra safe investment plan will get you 4.5% or 27 G’s, an aggressive investment plan could get you rent free)

Then wait for valuations to reset. We’ve talked about inner city valuations… there might not be a drop in a few areas for the exact same reasons you outline with commutes but really, if you’ve got $600 G’s in equity, you can’t generate wealth on that, it has to be done with RE at or near its zenith peak? Do you really think at this point that RE is your only one trick pony to generate equity?

Raise the rent bar, stay liquid, invest wisely and forget silly notions like a second story upgrade, its crazy to contemplate something like that in this environment.

Best of luck.

#120 bigrider on 07.09.12 at 12:41 pm

” Stocka markato isa bad , Real estata isa good”

That is what I overheard a bunch of construction workers say, passing by a construction site for a new condo building this morning, downtown T.O.

I’m afraid this mantra is all too common.

#121 TimV on 07.09.12 at 12:50 pm

Vikay/anonymous: If you’re really intent on selling, you could consider going east or west of the downtown, along the Bloor-Danforth line. You won’t be downtown proper, but you may find some of the neighbourhoods there have a close enough feeling. I don’t know which line your work is off of, but you’ll almost certainly find the east-west subway to be much nicer. You could probably stay price-neutral and get what you want; you would lose $70k on transaction fees, but $70k is cheaper than $200k for renovations (I’m worried about the $150k quote; we are budgeting $200k for renos on the 1.5 storey house that we (just recently) bought). Note that adding height to a 1.5 storey is probably not the most cost-effecient way of adding footage (but it may be necessary if you want to keep your lawn, or if there are permitting issues…).

Some commentators have suggested renting a condo. It’s a nice idea, but in your case, it is a bit risky. There is a very small supply of 3 bedroom condos. If you find one to rent but then the landlord kicks you out, you could have a lot of trouble finding a comparable 3 bedroom condo to rent on short notice. I totally believe condo prices will fall, but because of the scarcity of 3 bedroom condos downtown, putting yourself in a might “need” to find one on short notice. Of course, with one kid, you don’t need a 3 bed condo, but if you consider 3 beds to be one of your requirements, then renting a condo is probably too risky (even if you can find a 3 bed right now to rent). If you are going to consider condo living, then that’s just another argument in favour of waiting in your current Willowdale home and then finding that 3 bed condo when they are cheaper (and I think even Garth expects condo prices to fall by a greater amount than detached house prices).
You only mention one kid, but note that two kids can live quite happily in one room for quite a while… Just in case you’re worried about that.
Just a thought: consider daycare downtown. It’ll be a bit more expensive (unless you go on a year-long waiting list to get into a cheap one). However, your pickup / dropoff issue might be simpler. We have a daycare about 15 minute walk from my work, which is super-convenient.

Of course, if you really have to have a home in Cabbagetown, then sell now, rent the absolute cheapest smallest apartment you can, and wait (and cross your fingers)… But is it really worth the multiple moves and other sacrifices?

#122 bigrider on 07.09.12 at 12:55 pm

The difference between the careers of investment advisors and real estate sales people when it comes to the questions asked by their clients:
Advisor-
Hypothetical : Is it a good time to buy (or sell) RIM ?

Answer: Advisor has a 50% propostion of being correct..and will no doubt be judged immediately and on an ongoing basis.

Real estate agent-
Hypothetical: Is it a good time to buy or sell.

Answer: Yes. Oh and if client has ‘made’ money on a sale, an RE agent looks like a hero and if client buys and property declines in value ,proposition of success can be extended indefinitely as the proverbial answer “real estate is a long term investment that always goes up ‘can be used to satisfy client. In addition ,since there is no BNN for RE with red and green arrows daily RE, agent may even get away with deluding the buyer that he is ‘in the money’on his recent RE purchase.

Real estate agents win again…unfortunately.

#123 smartalox on 07.09.12 at 12:57 pm

@#14 Joe Blow:
Are you nuts? Toronto’s subway is infinitely better than sky train. For one thing, Toronto’s bus routes actually CONNECT with the subway system, in ways that Skytrain simply does not.

Skytrain’s reach and capacity pale before those of Toronto, where one can travel as much as 100km on a single price fare. Skytrain fares have various zones, with fees up to $5.50 (for people who choose to pay). Have you ever tried to travel from midtown Vancouver to Burnaby? How about from downtown Vancouver to a ferry terminal? Oh you can get there from here, but you have to transfer three times, and wait a minimum of 20 minutes per transfer for the bus. Don’t even get me started about the lack of services on the West Side, or how Boundary rd, a major north-south artery offers no contiguous bus service, and no Skytrain station?!?

Rush hours in Vancouver are a joke, with the city’s newest line exceeding capacity almost the moment that it opened, yet it was built with no room to expand!?!. I used to live in midtown, and commuted to south Burnaby; I had to take two busses in the opposite direction, just to get on the Skytrain, so that I could take another bus to my destination. I gave up and started riding my bike – it was more reliable (translink would cancel service at the first hint of snow) and took 30% less time by bike vs. Transit. Good riddance.

Toronto’s transit works remarkably well as a regional transit system, given the simplicity of its design. Skytrain and all of Translink is a bad joke by comparison.

#124 Canadian Watchdog on 07.09.12 at 12:58 pm

#108 Daisy Mae

Not everything will go down in price. What we’re having is an inflationary depression where commodities prices at wholesale levels will moderate while other overvalued assets will depreciate at a much faster rate. The reason is because Asia and emerging markets are starting to consume commodities—filling the gap lost by declining western demand. http://tinyurl.com/ceedwnl

#125 TimV on 07.09.12 at 12:58 pm

CMM: Royal York subway is definitely not downtown, although it may be a perfectly nice place to life. Broadview I’ll give you, but only very barely. Rental houses in that area are about 20:1 to 25:1 price to rent ratio, however, so a 3 bedroom by Broadview will quickly hit you for $800k to $1.5m, putting rent at over $3k/month for a 3 bed.

#126 Dontcallmeshirley on 07.09.12 at 1:27 pm

@ #55 Canadian Watchdog,

July 5, 2012: Foundation Mortgage Corporation Bankrupt:
—————–

Nice link Watchdog. Rob McLister feels mortgage investment corps like Foundation will help fill the gap in the new regulatory environment. Um, okay…

The affidavit from Foundation’s principle is in the links, did you see it?

Hilarious…he raised almost $15M in 2007, via 11% “bonds”. Seriously, who falls for this??

#127 Kevin on 07.09.12 at 1:38 pm

“Yonge subway line breakdowns (oh TTC!)”

You know those “breakdowns” are actually just a euphemism for suicides, right?

#128 brainsail on 07.09.12 at 1:54 pm

The picture of the young cowboy is priceless! Reminds me of a saying here in Texas. “Big hat, no cattle!”

#129 BCObserver on 07.09.12 at 1:56 pm

I don’t appose a “sell and rent” idea in general, but it is funny to see how some people giving those astronomical kind of advices here most likely have never owned a house. Moving to a rent after living for years in your own place would not feel that great. There is no such a dollar equivalent to express everything in our life.

#130 smartalox on 07.09.12 at 2:06 pm

More relevant to today’s discussion, an excellent piece in the Globe, illustrating what can happen with these new mortgage rules:

http://m.theglobeandmail.com/globe-investor/personal-finance/mortgages/new-mortgage-rules-could-make-switching-or-refinancing-tougher/article4389044/?service=mobile

#131 Karie on 07.09.12 at 2:09 pm

To the guy and dad who want to buy the second part of the duplex in BC
Buy it, if you can get positive cash flow right away.
If you can sell the whole duplex right away and make money, then you can do that.
If you really want a real estate rental, maybe take $100,000 and buy something cheaper and then put the other half in bank preferreds as Garth said or all of it if you decide you don’t want to be a landlord. Up to you and your dad – work the numbers. I will have to educated myself about ETFs and bank preferreds – I have mutual funds and stocks.

To the lady who wrote the long letter about renovating or moving. I agree with Babblemaster – people are never content. Do you know the upheaval you would experience doing such an extensive renovation and the costs could go higher and you don’t even like the neighbourhood?! Move downtown where you want to be but you don’t have to spend a fortune.

I was all set to move a few months ago – mainly because I wanted a pool. We thought about and said not worth the money or hassle of moving, let’s rent a cottage and go to the beach more. Problem solved! Maybe you can do less extensive renovation than a second story and get what you need!

#132 Anthony Mayfield on 07.09.12 at 2:31 pm

Vancouver and Toronto are the first dominos to fall… Calgary, then Edmonton are next on the hit list..

#133 eastvanspesh on 07.09.12 at 2:49 pm

One quarter of Canadians — or, 26 per cent — are still under the impression that the amortization period is 30 years, according to the BMO poll.

Read more: http://www.ctvnews.ca/canada/tighter-mortgage-rules-now-in-effect-but-do-canadians-know-1.871002#ixzz209XDRsqC

#134 bill on 07.09.12 at 2:53 pm

”I want to hear more about the look you got in the 1950s from those who went through the Depression.”

My grandfather carefully hammered flat any nails he found and put them ,according to size ,in mjb coffee cans,till his dying day basically.
he was a teacher by profession in the thirties but was not paid as the school board had no money. he fished commercially during the summer to make ends meet.
he and the other teachers traveled to the students
houses and farms after school, trading education for food. fortunately most of the students lived on farms.
he didnt talk about it much. we reckon the family had it pretty good compared to others.
the incident that I think he was most disturbed by was not the events of the thirties but the day in 1942 when the government took his best students away because they had japanese ancestry. he was very bitter about that . never forgave the people involved thats for sure.

#135 Really on 07.09.12 at 3:00 pm

Ah, all you “its smarter to rent” people. let’s get real okay.
We have rented the same house in North Vancouver for 12 years. Every one of those years we have paid a minimum of 1000 a month LESS than market rent. We pay no property tax, no cost of any major repair.

EVEN if we had put aside $1000 a month for 12 years (which we didn’t because IT DOESNT WORK THAT WAY)…we would have made 3 times that had we owned the house.

Yes there are times to rent – but lets not get all righteous about it because in normal and boom times it’s NOT the right thing to do.

Btw – we still live in that house and are particularly thankful that we are renters in this market.

#136 David on 07.09.12 at 3:05 pm

I plead mea maxima culpa for recommending Garth’s blog to real estate zealots.
Schadenfrude is not going to help the families that got swept up in the housing bubble vortex and are facing the prospect of upside down mortgages with no qualified buyers to relieve them.
Canada had it very own home grown sub prime housing bubble and all of us are going to pay for the party that was of benefit to the few and the detriment of the many.

http://www.counterpunch.org/2012/06/15/housing-market-smackdown/

#137 John on 07.09.12 at 3:09 pm

House Horny House Wife wrote:

“You cannot base your decision only on dollars and cents but also on what you want to do and where you want to be. Otherwise, you will be unhappy forever.”
——–

There it is. The backwards rationalization that starts from the above statment… from “the office of she who is wearing the pants”. This deal’s done.

Huge uproar while the world economy goes wonky. And this person will be renting with an “account” filled with digital zeros and whatnot. With no house.

As you can see, there isn’t any testosterone around to stop the guilt play. So it IS a done deal.

Also, you can’t put a value on drama and chaos. The real happiness being referred to here. All vehemently denied. “It’s not fair”.

#138 Frank le Skank on 07.09.12 at 3:15 pm

I’ve read from multiple sources including this one that everytime Flaherty change the mortgage rules, we see a dip in prices and then the market bounced back and keeps going up. Does anyone thing we have hit the wall yet?

#139 ISoldMyHouse on 07.09.12 at 3:19 pm

@ #107 Jim

Yes, I’ve seen many open houses in North York these past few weekends with no one there. We are actively looking for another house after selling ours in the spring but we’re in no hurry to buy anything right now. Our agent sends us daily listings for the area we are looking in and I am surprised by the number of price cuts coming through. I think our agent is getting a little frustrated with us for not buying anything but we are willing to wait to see what happens. We have a year lease on an apartment so we have lots of time.

Question: How will we know when the bottom has been hit? Are there any statistics that might be an indication of this?

#140 Timbo on 07.09.12 at 3:34 pm

http://www.bloomberg.com/news/2012-07-09/consumer-credit-in-u-s-jumped-by-17-1-billion-in-may-fed-says.html

“The $17.1 billion increase, bigger than the highest estimate of economists surveyed by Bloomberg News and the largest this year, followed a $9.95 billion gain the previous month that was more than previously estimated, the Federal Reserve said today in Washington. Revolving credit, which includes credit card spending, rose by $8 billion, the most since November 2007. ”

The so called recovery is based on one very large increase in consumer debt. Grab the visa and lets go shopping……….

#141 DM in C on 07.09.12 at 3:46 pm

Really:

I don’t get what you’re saying, and your tone is perplexing — are you saying that it wasn’t smarter for you to rent? Aren’t you bragging that you don’t pay property taxes nor maintenance?

Are you saying that it’s not possible to put away $1000 a month that you save by not buying? It does work that way, actually — it’s called budgeting.

You’re saying that in boom times people shouldn’t rent — but you’ve rented for 12 years — why didn’t you buy?

Or is this just a case of hindsight being 20/20?

Odd posting.

#142 EdmontonJim on 07.09.12 at 3:47 pm

That bob guy seems to have a crush on Garth. It looks like about 20% of his blog is dedicated to this one.

Bloggers like attention, and he likely got more traffic today than the life of his blog combined.

#143 50% Correction Predictor on 07.09.12 at 3:53 pm

#138 Frank le Skank

I’ve read from multiple sources including this one that everytime Flaherty change the mortgage rules, we see a dip in prices and then the market bounced back and keeps going up. Does anyone thing we have hit the wall yet?
.

_________________________

Hey, stinky Skunk,

Why do not you go out buy one tomorrow and sell it in a month?

Let us know if the market has hit the wall.

#144 jess on 07.09.12 at 4:03 pm

Israel ?

The first indictment in the NIS 1.3 billion fuel fraud was filed with the Tel Aviv Magistrates Court today against Yosef Letin, who is charged with violations of the VAT Law and Income Tax Code, defrauding the government of NIS 182 million in taxes.
The Israel Tax Authority announced the multibillion shekel tax fraud last month, after an intelligence operation lasting several months. The Tax Authority and Israel Police arrested eight suspects and detained fifteen other people for questioning. The suspects included fuel traders, who allegedly distributed fictitious invoices to evade VAT on the excise component of fuel prices. The suspects are also being questioned about possible violations of the Prohibition of Money Laundering Law (5760-2000) and breaches of the Income Tax Directive.

The case is the largest-ever financial case every investigated by the Tax Authority, involving NIS 3.5 billion in transactions on which NIS 600 million in VAT should have been paid.

The Tax Authority and Israel Police arrested eight suspects and detained fifteen other people for questioning. The suspects included fuel traders, who allegedly distributed fictitious invoices to evade VAT on the excise component of fuel prices.

#145 jess on 07.09.12 at 4:07 pm

the casino is going after the kids…

Shocking trend of gambing sites luring children

A source at a major casino group said: ‘Social gaming isn’t regulated, which is outrageous. The gaming companies deliberately use cartoon characters that pitches it slap-bang at children..

He discovered that the games, while initially free to play, were encouraging his daughter to buy extra ‘coins’ with her own money.

Facebook says that under the current definition, the games on its site do not constitute actual gambling
Read more: http://www.thisismoney.co.uk/money/news/article-2170182/Cartoons-fun-friends-How-children-lured-gambling-online.html#ixzz2034wZFZn

#146 debtified on 07.09.12 at 4:17 pm

#135 Really on 07.09.12 at 3:00 pm

I think most people who said “it’s smarter to rent” actually meant “for now”. Most of these people actually owned properties in the past (until it became smarter to rent) and are planning to own again sometime in the future (when sanity once again prevails in the real estate market).

I also think that the right time to buy is when you can afford it AND (more importantly) you buy the house to make a home out of it (not to make money out of it).

#147 TimV on 07.09.12 at 4:18 pm

#119 daystar: Just remember that over time, the real value of the $600k will decline due to inflation, so if the 5% it spits off is used to pay rent, then 30 years from now, there might be a problem (depending on salaries, etc). You need to do the full calculation of how much savings Anonymous will have after paying rent, and whether this savings will compensate for the effect of inflation on the $600k, etc. I’m not saying $4k is either too much or too little: only that you have to do a more complete calculation to confirm that Anonymous can afford $4k/month rent than to simply assume she can use the full 5% that the $600k spins-out. Guessing at $150k/annum income for the couple, $4k/month rent is doable but pretty steep.

#148 Kenny Banya on 07.09.12 at 4:22 pm

@Sean

What could I get for that… let’s try this place for $2100: http://toronto.en.craigslist.ca/tor/apa/3126865982.html

This really shows how ridiculous the rental market is too, for “only” $2100, plus utilities, plus more for garage parking, you could get a very small-looking, mediocre house with a broken fire place, right by the go train tracks. With a listing that mentions twice that there is a fridge and stove included (how luxurious!) and doesn’t seem to know if air conditioning is included.

#149 I'm stupi on 07.09.12 at 4:23 pm

Garth why don’t you delete #27 and ask him or her to link the info?

The last thing I want is to encourage him. — Garth

#150 jess on 07.09.12 at 4:28 pm

i googled foundation and this came up

http://www.topix.com/forum/ca/calgary-ab/TCJJLRO0CQH5KIS76

Foundation Capital Harvest Group of Companies —-

#151 I'm stupi on 07.09.12 at 4:28 pm

To all that complain about the Toronto subway, I’ll give you the reason for the delays. It’s all the jumpers. A person a week commits suicide by jumping in front of the subway. What would you have the ttc do just keep driving over the dead bodies? The solution would be easy either have the trains slowdown before entering a station or put up rails that open when the train arrives.

#152 Glen on 07.09.12 at 4:28 pm

#76 – Vikay

Lots of good advice here and I think you’re on the right track. Regan (#97) also has a good comment.

The only thing I’ll add is forget the major reno, but do consider adding (or upgrading) the air conditioning. You might as well be comfortable.

#153 Bill Gable on 07.09.12 at 4:33 pm

My late Gran told me that “without a garden, during the Thirties” – we would have starved. My Dad lucked out and got a summer job in 1936, on one of the Princess Ships, plying the Alaska route.
He was 6 feet tall and weighed 117 pounds.
He got very lucky. Movie star Robert Taylor took a shine to Dad. The night before the ship docked in Vancouver, Mr. Taylor called my Dad aside, and handed him an envelope. This incredible man had taken his own time and flund out that Dad was poor, and struggling through UBC. Taylor found out how much a year’s tuition was.
The check insidd was for the full amount. He shook my Father’s hand and said that he wished Pop luck, and knew he would be a success.

Cut to 1945, and my Dad had spent 6 years, plying the North Atlantic, in a Corvette. (hell). Dad’s last passage was escorting some US Ships to New York.
Incredibly, Mr. Taylor was making a personal appearance at the premier of one of his films. Men in Allied uniforms got in basically free.
My Dad sent a note to Mr. Taylor’s gatekeeper, and asked to speak with him. Permission granted, my Father walked up to this huge Hollywood star, and Taylor looked at him, and lit up.
He shook my Pop’s hand – and said how proud he was of my Dad.

Without one famous man, my Dad would have been without a sou. Because of one man’s generosity, my Dad got his degree. At UBC, aftdr the War, he met my Mom.

They wed 65 years ago today.

Show’s you how one man’s kindness, literally savec another man and gave him a life.

In these timex, a great lesson.

Mr. Turner donates his MP/Minister’s pension to charity.

I think the lesson is – no matter how tough things are – help, volunteer, donate. You never know what your kindness might lead to.

Be a good citizen, and your life will be the richer for it.

Goes to show you that we are all our brother’s keeper.

We all worry about money, etc. But – your life is not measured in money. In the end, it is in the kindness that will give your life meaning.

Not the size of your house.

I hope this inspires you. It led me to a life of service, that has given me more joy than I can express in words.

#154 Bill Gable on 07.09.12 at 4:35 pm

Darrn Iphone typing sucks. Apologies.

#155 Questioning Calgary stats on 07.09.12 at 4:38 pm

Ah Calgary.

There has never been cheaper money (emergency level interest rates for 3 years?????) or easier money (CMHC has been very busy over the last 3 years insuring high (and higher) risk mortgages).

Since 2009, the housing markets in both Vancouver and Toronto have blasted through the stratosphere and set all time highs in terms of price. Calgary, on the other hand, well….. [email protected] At best.

Why has Calgary’s housing market paled in comparison to other Canadian cities over the last 3 years of cheap and easy money? What has caused this underlying weakness? Potential buyers should be seeing a red flag right now. This weakness can only be exaggerated as mortgage rules tighten.

Don’t worry about those Calgary realtors that hate you Garth. What they hate is unbiased and factual information that might stand in the way of potential commission money. I doubt they would allow this comment to be posted on one of their sites.

Calgary buyers beware! Wait at least 1.5 to 2 years before you buy. Give the new regulations time to kick in. Prices can only go down and you will save yourself a lot of money. If prices decrease 20%, that could easily save you $100,000.00 minimum. Try saving that amount of money in 1.5 years.

#156 Men Who Stare At Sheeple on 07.09.12 at 4:46 pm

#2 TurnerNation

Bullseye! It’s good to see more and more people beginning to unplug themselves from the controlled Matrix and stepping outside the system to see the real bigger picture! What is the Matrix?

“The Matrix is a system, people. That system is our enemy. But when you’re inside, you look around, what do you see? Businessmen, teachers, lawyers, carpenters. The very minds of the people we are trying to save. But until we do, these people are still a part of that system and that makes them our enemy. You have to understand, most of these people are not ready to be unplugged. And many of them are so inert, so hopelessly dependent on the system that they will fight to protect it.”

‘”The Matrix is the world that has been pulled over your eyes to blind you from the truth.”

There is real truth and deep hidden meaning in this dialog.

People need to realize that almost all major global terrorism is being carried out by the intelligence agencies. In particular the CIA, Mossad and MI6, which are nothing more than front operations of the private international banking cartel. Most all major terrorist attacks are false flag operations designed to blame a country, group or individual for something they did not commit. The 9/11 attacks and London train bombings are but a few examples. The 9/11 attack was their “coup d’état” and used to launch the fraudulent “War on Terror” to expand their banker wars into the Middle East to gain control of the oil and economies of these countries.

All of the global terrorist networks are funded, armed and trained by the intelligence agencies. In truth Bin Laden and Al Qaeda are just CIA/Mossad created bogeymen used to justify endless illegal wars for global domination and control of the masses through fear! The CIA is also the world’s largest supplier of weapons and drugs!

As for the military, this is what the war criminal Henry Kissinger had to say “Military men are just dumb stupid animals to be used as pawns in foreign policy”.-The Final Days by Bob Woodward & Carl Bernstein

I believe that most military men are honourable men that are being purposely misguided, manipulated and lied to by their warmongering military superiors, government officials and corporate controlled mainstream media. In truth there is no honour in fighting, killing and dying in manufactured wars for global domination!

Folks, from the global financial and economic crisis to the global War on Terror, we the people are being hoodwinked! It’s time for humanity to wake up from it’s deep slumber and see the truth of the world around them.

“I’m trying to free your mind, people. But I can only show you the door. You’re the one that has to walk through it.”

#157 American Werewolf in BC on 07.09.12 at 5:07 pm

#129 BCObserver on 07.09.12 at 1:56 pm
Moving to a rent after living for years in your own place would not feel that great.

====

I did it. Feels fine. I wish I did it earlier before the popping bubble wiped out most of my potential gains. Life goes on. Im much happier without a debt cloud hanging over my head day to day. Much less productive though.

#158 Timbo on 07.09.12 at 5:12 pm

#116 Toronto_CA

Wow. This is one of the first bubble articles at the G&M I actually thought was well written. It is like something I would have written.

Strange I cannot see your writing style in that link?

Could you point out the multiple paragraph union bash / anti-government tirade with a side of flame?

Remember that every time you link to a union paper hypocrisy taps your shoulder.

;)

#159 Tkid on 07.09.12 at 5:17 pm

The landlord is selling the place I rent. It is identical to the condo next door, except the hardwod floor is a different colour. Both units come with storage locker and one parking spot.

Next door is asking $260,000, landlady wants $300,000.

I wonder who will sell first?

#160 so it begins... on 07.09.12 at 5:35 pm

#107 Jim

i agree , It will be condos first

Condo sales this year – April + 9%, Mid May +18%, by the end of May +5%, mid June (-13%), end of June (-18%). And the inventory is rising (declining sales and declining inventory will not cause a correction).

The new mortgage rules come into effect in an interesting time, during the slow period of RE. I wonder if that was planned – Prices and sales usually decline m/m , people will think “oh its starting to burst”, instead of thinking “oh its seasonal.” Maybe it will have a psychology effect on buyers (to stay away) in the fall when there is usually an increase in sales and prices.

#161 Toronto_CA on 07.09.12 at 5:57 pm

#158 Timbo on 07.09.12 at 5:12 pm

Come on, I’m not THAT bad. I don’t like government waste and overspending. But I’m not a jerk about it! I see the logic in raising corporate taxes and GST, too!

We’re all housing bears here, can’t we just get along. Did you like the article?

#162 Veej on 07.09.12 at 6:06 pm

Ah the value of a real estate agent…

http://www.moneyville.ca/article/1221563–toronto-realtor-calls-for-stiffer-bidding-war-rules-after-clients-offer-90-000-over-with-no-rival-bids

#163 More luck than Brains on 07.09.12 at 6:31 pm

Garth, are you a renter or home owner?

I bought my first house in 2004 and my mortgage was under 1k. This August I’m moving into my 3rd home and
I will be mortgage free. I’m glad I became a homeowner when I did, but I was fortunate as with everything it boils down to luck and timing.

#164 jess on 07.09.12 at 6:37 pm

“Many multinationals divert Foreign Direct Investment (FDI) through third countries that have
a favourable tax treaty network, to avoid host country withholding taxes. This is referred to as
tax treaty shopping. The Netherlands is the world’s largests pass-through country.”
tjn

coquitlam
To promote the benefits of locating and or investing in the city, Munro has developed a presentation for potential investors, which has been shown to the Netherlands Consulate…
http://www.tricitynews.com/business/141776053.html
=====
The Netherlands is the major conduit for foreign direct investment

THE NETHERLANDS was the No. 1 recipient of foreign direct investment (FDI) globally as of end-2009, but because most of the funds passed through on the way to other economies the Netherlands was also the top source of FDI, according to new data from the IMF᾽s Coordinated Direct Investment Survey (CDIS).
http://www.imf.org/external/pubs/ft/fandd/2011/09/dataspot.htm

APRIL 2008
Canadian Tax Authority Loses in Tax Court Case Concerning the “Beneficial Owner” of Dividends Paid by a Canadian Subsidiary of a Netherlands Holding Company
http://www.blakes.com/english/legal_updates/tax/april_2008/CTA-Beneficial%20Owner.pdf

#165 jess on 07.09.12 at 6:49 pm

http://truth-out.org/news/item/10241-on-the-news-with-thom-hartmann-pennsylvania-mayor-cuts-police-and-firefighter-pay-to-minimum-wage-and-more

Emergency Financial Managers in Michigan are selling off public schools to private charter school corporations – and laying off hundreds of public school teachers in the process.

#166 David on 07.09.12 at 6:53 pm

The bubble is only starting to burst and in the future there will be plenty of blame to go around for this debacle. Boomers planning on downsizing and retiring on their home equity are in for a big shock.
A story without a happy ending and a great deal of long term economic pain that could have been avoided.

http://www.peoplesworld.org/canada-s-dirty-little-sub-prime-loan-secret-threatens-to-sink-housing-market/

#167 Timbo on 07.09.12 at 7:01 pm

http://www.presstv.ir/detail/2012/07/08/249976/china-to-invest-usd-20-bn-in-iran-oil-fields/

“Iran’s Oil Minister Rostam Qasemi says China has agreed to invest USD20 billion in developing north and south Azadegan and Yadavaran oil fields which will finally produce 700,000 barrels per day (bpd) of crude oil.”

http://www.bloomberg.com/news/2012-07-09/norway-government-ends-oil-strike-lockout-averted.html

“Norway’s government said it ordered compulsory arbitration to end an oil and gas production strike, according to a statement published on the Oslo-based Labor Ministry’s website today. ”

Oil strike over? Embargo’s that attract investment? Downward pressure here we come…………….

#168 Keith in Calgary on 07.09.12 at 7:02 pm

#155 Questioning Calgary Stats……..(a great handle BTW)……..

During 2008 Calgary RE prices dropped 20% in about 9 months……..until the ‘gubmint opened the monetary flood taps that is.

The rest of the time they have basically flatlined with little bursts up and down, but in reality they are going nowhere in the long term, except downward.

The amount of blatant, yet subtle, statistical manipulation by the various real estate boards around the country has been adept at painting a picture that is much more rosier than the reality, had the stats been correcly reported in the first instance. There are many ways to “cook the books” in reporting and recording sales stats and still inwardly feel justified in presenting a truthfull accounting of the numbers, when in the fact is you are just plain lying.

Having been a salesman and sales manager in the automobile industry for over two decades I speak from experience. To wit…….

-Staggering the multi-million dollar sales of any given month, and have the reporting of them evenly spread out over as many days as possible to paint a sequence of constant activity and balance out/inflate the daily average price, which paints a false picture.

-Holding over and reporting numerous higher end sales for the first 1-5 reporting days of a new month (especially after a particularily bad one has just passed) in order to generate buzz, and again, provide a sense of a rise in the market where there really was none.

-Pull forward pending sales that are closing next month and report them in a month that is closing off, but short of the manipulated number that they need to be met.

Etc…etc…etc…..in each case you are reporting actual sales, just not on the correct dates or months, and in a manner designed to present a picture that is not the reality.

#169 So it begins.... on 07.09.12 at 7:13 pm

From the theredpin.com

Listing in Toronto jump 26% (1263) week/week.

#170 TurnerNation on 07.09.12 at 7:17 pm

Is this posted yet?

http://www.thestar.com/business/article/1223395–toronto-condo-buyers-welcome-back-to-the-driver-s-seat

Toronto condo buyers, welcome back to the driver’s seat

Published on Monday July 09, 2012

#171 Canadian Watchdog on 07.09.12 at 7:37 pm

Brand new condo already selling for 92% of original list price. http://www.buzzbuzzhome.com/corktown-district-phase-ii

MLS Sale http://postimage.org/image/kie65gx3v/

Developers are getting desperate to sell.

#172 TurnerNation on 07.09.12 at 7:43 pm

Acceptable townhouse near Finch Subway stn. Live here, subway downtown. 2300/mo.

http://toronto.kijiji.ca/c-real-estate-house-rental-Yonge-and-Finch-3-1-BR-Townhouse-Yonge-Finch-W0QQAdIdZ394202303

#173 Darlene on 07.09.12 at 7:53 pm

Bill Gable on 07.09.12 at 4:33 pm

“I hope this inspires you. It led me to a life of service, that has given me more joy than I can express in words.”

It does and thank you.

#174 TurnerNation on 07.09.12 at 7:57 pm

#145jess on 07.09.12 at 4:07 pm

And 12-18 yr olds are the biggest target for Beer and Cigarette marketers. They’ll never admit it. But it’s true.
Mike’s Hard lemonade. Bud Lime. Vodka coolers. Great for teens. Surgary drinks almost like pop/soda.

How about Joe Camel the cute Cartoon mascot. For kids.

#175 Canadian Watchdog on 07.09.12 at 8:14 pm

#162 TurnerNation

“The launch of the tower, which could house up to 795 units, has been delayed until late September, but only because of design and approval issues, says Tridel vice president Jim Ritchie.”

I stated over a month ago to watch out for ‘delay wars’, as every developer will push the occupancy date further, just to get a few more sales in before the pre-sellers flood the market.

#176 bubble head on 07.09.12 at 8:18 pm

# 160 so it begins…

Your theory may have some merit.
Condos
Month 2011/Sales/Prices
April / -20%/ +8%
May / -12%/ 1%
June /+22/ +8
If he changes it in April of this year it would probably have flatten the sales and price erasing the 9% and 3% increase we experienced. RE agents would of spun it and said you see the new rules has made it a more balanced market. Doing it now when sales and price decline m/m would have more of a negative impact.

#177 jess on 07.09.12 at 8:29 pm

rate swaps – evil
100’s of municipalities are struggling
http://truth-out.org/news/item/10220-oakland-takes-on-goldman-sachs
===========
Rate Swap Scandal
http://www.telegraph.co.uk/finance/rate-swap-scandal/9364019/Big-Four-banks-admit-to-mis-selling-interest-rate-swaps.html
Big Four banks admit to mis-selling interest rate swaps
Barclays, HSBC, Lloyds and RBS have admitted to mis-selling interest rate hedges to small and medium sized business customers and agreed to compensate them as well as stop selling the most complex products.

#178 daystar on 07.10.12 at 12:18 am

#147 TimV on 07.09.12 at 4:18 pm

Holding onto RE that devalues 10 to 20% over 3 to 5 years and possibly 30 to 40% from 5 to 7 years is hardly a way of keeping up with inflation.

A renting forever plan was never in the cards. At some point you buy back into this market but it could take 3 to 5 years to melt risk away. I’m personally thinking interest rates will remain low but once they start climbing, look out! Rates have been at or near zero from the BoC since Febuary of 09′. If rates begin to move in Febuary of 2014, it means 60% of mortgage holders (5 year terms) will be renewing terms into higher rates, some of them much higher and thats about the time I see rates moving upward. I see BoC rates around 5 to 6% between 3 and 5 years from now. Think about what this would do to the value of all RE including the values of their homes.

I’m more concerned about wealth preservation here with them, they’ve already added 300 K from their pockets with income… inflation isn’t a concern for me, its preserving the equity they have and that means sell. In the meantime, they can learn to invest.

#179 Artem on 07.10.12 at 6:44 am

@joe_blown_away Have you ever been to Russia? Moscow subway is the best of all the subways I have ever seen: clean gigantic stations, spacious cars, trains arriving each 80 seconds, hardly ever interrupted. St. Petersburg is the close second. I’ve been to subways in Toronto where I live, Montreal, Paris, London, Vienna, Barcelona, and New York, and each of them is worse than Moscow’s in one way or another.

I have to agree that Toronto’s TTC is pathetic though. The only thing good about it is spacious cars and new Yonge line trains (I hate hate hate these tiny tin cans they call subway cars in London and Paris)

#180 TimV on 07.10.12 at 7:54 am

#179 daystar: My concern is that the $4k/month place that they rent will never hit their affordable price range to buy, either. If you can’t (easily) afford to rent it now, then it will take a very large price correction before you can (comfortably) afford to buy it. Unless they’re in the downtown condo market, I’m not sure that the price correction will be large enough.

Fundamentally, I think there are two constraints “3 bedroom house” and “downtown”. Anonymous can easily meet either one, but to meet both on a long-term basis… Of course, there are intermediate points (eg: 3 bed on busy street, or expanded definition of downtown (would be my choice I think), or probably more).

#181 Bill Gable on 07.10.12 at 7:17 pm

Nostie – anti Jewish sentiment in your latest post was at best disturbing, but at worst, disgusting. I would imagine that you are also going to tell us that “Arbeit Macht Frei”, eh?

I think using the good graces of our host for spewing such garbage is totalky repugnant.

You are a sick puppy and ought to be banned.

Racism has no place in Modern men’s lexicon – at least one’s with brains.

You will reap what you sew, sir.

#182 Bill Gable on 07.10.12 at 10:25 pm

Darlene and Peter – thank you.

I am very pleased that you feel the same way about service as Mr. Turner and many of our fellow blog dogs do.

Very gratifying to get your notes. Next time, I will type using my Mac!