Liz says she read the piece yesterday about Brampton. “I’m certainly not surprised,” she sniffs. “Most of the people I know would hate to live anywhere in Brampton or want to leave Brampton. But what about Oakville?”
Actually, what about you?
“We’re in our 30s and our jobs seem solid. We have been waiting to upgrade in the market for about 4 years, just narrowly missing our chance to buy in 2008. We own our townhouse outright (worth $360K) and have about $200K in savings. We’re noticing more and more signs for open houses in our river oaks area.”
But houses in River Oaks average more than $700,000. You don’t have kids, so why move into a suburban monster house, dump all your equity and savings, and end up with a mortgage and no diversification?
“Our parents both live out of town and haven’t been visiting largely because our house has only one shower and no real space for privacy/guest room. When/if do you think lower prices will come here?”
Liz is more typical of people than may be apparent looking at the rabble of malcontents, iconoclasts, anarchists, voyeurs, basement-dwellers and the occasional nazi who frequent this pathetic blog. She covets a fat house and is willing to take financial risks to get it because she wants another shower (a $25,000 reno, at most) for parents who come once a year.
But it’s not about the shower. As with couples who get pregnant and instantly lust for four bedrooms and a backyard, or kids who decide to shack up and run out to get a condo, it a matter of wants, not needs. Most people buy houses because they want them, even when prices are at historic highs and destined to fall. Intellectually, they know better. But emotionally, they’re crippled.
Like Herman. He bought a downtown condo from plans in 2007 for $350,000, then caught the wave and rode the market higher. Today he lives in a place worth $560,000, with a $250,000 mortgage and $600 monthly fees. Should he take a once-in-a-lifetime two hundred grand tax-free capital gain? Or be an idiot?
“I’m no mathematician, Garth, but in my hypothetical (sell and rent at for 24 months until the market dies), once I factor in real estate commission and extraneous costs I’d be no further ahead. To illustrate: I’d have $235k in my pocket after the sale (tempting). After renting for two years @ $1,900/m I’d be left with about $189k. If, during that time, a condo like mine were to plummet 20%, it would still be worth ~$413k. Pouring my $189k in cash back into a property just like it – plus land transfer tax ($8,700) and legal fees ($1500) – I would be left with a mortgage hovering around $234k.
“In short, if you compare my current numbers and projected numbers, paying down my mortgage for the next two years vs. selling, renting and allowing the market to die out 20% for the next two years leaves would me at almost the exact same place.”
Of course Herman could put his $235,000 in REITs and dividend-payers like preferreds and collect $1,000 a month reducing his rent to $900 while cutting his living costs in half, occupying the same unit and retaining his principal. He could avoid a condo crash (surely coming) which would reduce his equity by more than $100,000, and harvest the money instead. Or he could continue to pay down his existing mortgage and be completely undiversified. And, of course, if his glass balconies explode into the crowded street below, he could enjoy getting a special assessment for twenty or forty thousand dollars, rendering his condo unsalable until paid.
See what I mean? The logic most people will use to justify the unjustifiable guarantees that real estate has a truly troubled future. Because the die is already cast. There’s simply no escaping what the next few years will bring.
This week came more evidence the market is slowing as sales declined nationally for the first time in a year. As you know already, deals in Vancouver have plunged by a third and SFH prices by 13%. Listings have swollen there and in Toronto, where sales are off 8% from last summer, and new lending rules have just reduced affordability. Naturally, CREA’s frankenumber, the “MLS Home Price Index”, shows a healthy annual increase in prices (5.1%), which is why it was created. That, and humour.
But not everybody, aside from Herman and Liz, are fooled. This, says TD economist Francis Fong, “provides more evidence that the housing market is beginning to come down to earth. The pace of activity in the market over the past few years was simply unsustainable, given the economic backdrop and was mainly being fuelled by the record low level of interest rates.”
TD claims prices will fall nationally by 10% or 15% over three years. But I’m sure it will be much swifter, while BMO economist Doug Porter adds: “The new tighter mortgage insurance rules that kicked in last week will chill a market that had already seen 16 of 26 markets post June sales drops … Even before the new mortgage rules kicked in, all signs suggest that the Canadian housing market was already cooling – the new rules will simply pull hard on a closing door.”
I’ve written before that most people will ignore me. They’ll pile into real estate for the most human of reasons, usually for the sake of a family they’re putting at risk. So I carry on, and will not stop.
By the way, it’s not different in Oakville.
201 comments ↓
Furst- a poem by furst
Furst come furst surve
I’m posting this now, I’ve got the nerve
To F5 until a new page does arrive
The joy of posting first, I do derive
Jim Lahey is my biggest fan
He runs a trailer park, he da man!
First is so awesome!!
1st suckas!
http://www.thestar.com/business/article/1227035–house-sales-decline-across-canada-but-prices-up-across-the-gta
Here we have the Toronto Star’s ace real estate pumper , Susan Pigg, putting out another ‘puff piece’. Note that her 2 sources quoted are both CREA execs
Garth – you’re definitely ruffling a few feathers out there.
Check out this Red Flag Deals post:
http://f.redflagdeals.com/showthread.php?t=1202991&s=7244ac64492e717da9da3ac12b2693d8
There is no such thing as real estate bubble
“There is only a Fiat bubble. I find it outrageous how some people sill want to convince you that having your hard earned money is better served by investing in some worthless paper equities rather than tangible assets.
Even Germans who are well knows savers are smartening up. Do not listen to wanna be financial advisers like Garth Turner and armchair speculators. If the crash didn’t happen in 2008 there is no way it will happen today. There is a massive escape from fiat currencies.”
Garth your a very smart dude would you manage my portfolio
No. — Garth
yes im first
Some people can only learn through experience; some can’t even learn through that. Garth can’t reach those people. Luckily there are a few who can be taught. Those are the only people that he can help.
US bond yields today were crushed. Again.
Frankenumber? Better than f****** number I guess. haha
First again!
http://www.realtor.ca/propertyDetails.aspx?propertyId=11747839&PidKey=-2060754819
HAM & Caviar & Champagne in Richmond BC.
Richmond BC makes Brampton look like Paris … or is that Winnipeg?
To bad so sad!!!! The end is near and I thank you garth for saving me!
SWEEEEEEEET!!!
When prices just keep going up, people think they’re holding on to a never ending ATM machine. And most who believe prices are slipping, think its a minor correction.
Still renting, still loving it. No risk, no worries, no property taxes, no maintenance. Mobile, free. It’s gooooood.
Firsstttt
Realtors are on every media outlet theglobeandmail and thestar posting their lies in a panic. We blog dogs need to spread the truth on every message board. You can smell the fear coming from the countless realtors who post day and night on garths blog. Together we can all spread the truth of the current housing crash and save people from those evil uneducated six week trained criminals called realtors. Does anyone watch hot property? It should really be called cold property.The best way to get on the show is to lie and claim to ask a pro positive RE question. the call screener will pick your question. when on air spread the truth and watch their faces as those criminals think of lies. Listing are exploding in the GTA and sales have stalled. post in a panic realtors
Read an article about coming great depression, how far you think it’s true.
What the hell am I doing wrong. They have paid off mortgage & $200,000.00!?!? Does every one that Garth gets letters from make 200k+?
Good advice, Bull Shit stories!
Why would people who write me lie? To make you feel inferior? Oh, wait… — Garth
Despite today’s numbers, Calgary boomers now say oh that is just Vancouver, Calgary is different. Speaking of the boom & bust cycle of a one industry town is taboo. The job ads here are not that great lately, unless you are an engineer. The economy is far from red hot.
Back in Toronto, friends in aging old condos still think their place is worth the maximum any unit in the are has sold for, even years ago. Denial seems to have staying power.
Maybe Vancouver after the crash will be worth checking out again for average Canadians. It is lovely on a sunny day.
The Conservatives will be giving away bedbugs at Xmas to over leveraged home owners
So it’s no different in Oakville eh….what about the east end (durham)? what about there??? Is anywhere safe???
today my neighbor agrees real estate is going down yesterday he was going to help his son with a down payment.
20% under by snow time
Liz = disgusting closet racist Canadian. Why don’t you like Brampton? Because you don’t like the skin color and the culture of people living in Brampton. Yeah don’t tell me it is because of the house price. At least the skinheads have the guts to say it out loud. What a whimpy loser.
Tell me that was sarcasm. Please. — Garth
Hi Garth. Great blog (U R saving people. thanks for that, and also thanks to all those adding useful comments here).
Why don’t you leave BC and GTA aside for a change and talk a little bit about some other cities… Montreal please. Prices don’t fall here… Sad but true??? How do you see Greater Montreal (recent Royal Lepage report says there is no cooling here, quite the opposite).
I don’t see this crash happening here. SFH in the suburbs are pointing high: Montreal main island, south shore (Boucherville, Saint Hubert, Saint Bruno, Candiac) and north shore (Laval, Blainville, Terrebonne)… everywhere… everywhere.
What does your oracle say?
Last11!1
First
Haha! Humans
Yes Oakville! When I’m in Rome or Paris, the fine city of Oakville is exactly where every Paresian and Roman tell me that they would love to live instead of the shabby 1 horse towns that they have to suffer in.
What an over-priced hell hole.
Realtors in Saskatoon I have been talking to are saying there has been a surprisingly high amount of price reductions on houses for sale in the last 2 weeks. The panic is coming here. Watch out below.
We’re in our thrities and our jobs seem solid.
Good Liz. Sounds like more or less you guys are doing okay.
But if your only in your thrties you haven’t seen a real estate correction.
I have yet to see one that lands softly.
All the ones I can remember are abrupt and hard.
That house that you covet, wait.
As to the parents not visiting cause they don’t have a shower, bang one in, about the same price as real estate fees and moving expenses.
(Might have to toss in a little more $ but whatever)
See if they show up, lot cheaper……
I deserve a 2500sq foot $750,000 house. The guys/gals at work all have one.
My job “seems” stable. Am I richer than I think?
A 3000 monthly housing nut (utilities, mortgage, insurance, taxes, maint.) is normal!?
People, monthly nuts are for squirrels!
I’m pretty sure the TD 10-15% drop number was before the CMHC rules and OSFI rules were announced, no? I wonder if they’ve revised their outlook further.
Good weekend in Bermuda. The housing market fell hard there a few years back; the condos I stayed at in Hamilton had a huge gaping hole in the lot next to it, where they began to build new condos in 2009 but had to stop. Now it’s just a fenced in pit with concrete at the bottom. I have looked into Toronto’s condo future and it’s not pretty.
This week we should get BILD’s report on new high rise sales. In July 2011 there was 2,309 high rise sales in Toronto (416), last month’s sales (June) 1,099, meaning if sales are even at par with last month, sales would equal a 52% decline. Anything less then we’re talking 55-65% decline.
——-
As for Herman: He purchased a $350,000 condo in 2007, assuming this is what he could afford or commit to according to income. In inflation adjusted terms, Herman’s $350k condo in 2007 is $381,222 in today’s dollars, but he wishes to still live in a place worth $560,000.
Anyone see the problem here?
#19 mattymatt12345
If it makes you feel worse, I have a paid off mortgage and $450,000.00….and no, I do not make 200K (or even 1/2 that).
furrrrrst…..ok….maybe not….(gotta do it)
what’s an “iconoclast”?
Someone who disses Mick Jagger. — Garth
#19) Response – Why would people who write me lie? To make you feel inferior? Oh, wait… — Garth
inferior… LOL you wouldn’t believe it… I’m your prodigy!
In the York region, we have seen a number of price changes in the past 10 days. All but one were drops; the exception was a hike from below-market to at-market – apparently it had been meant to spark a bidding war that never was.
The “come hither” Open House signs are everywhere, practically lining the roadways to induce people to look at houses. It’s mid-July! This is not business as usual.
Some interesting bubble properties and general RE insanity across the country today…
1) Show your Habs pride in Montreal by buying a condo in the “Tour des Canadiens” tower near the Bell Centre
http://blogs.montrealgazette.com/2012/07/16/habs-mania-hits-the-condo-market/
2) More HAM chasing in Toronto at C2409040 – 114 ESTELLE AVE
http://www.realtor.ca/PropertyDetails.aspx?PropertyID=12171696&PidKey=624186802
July 5th: $898,000
July 16th: $939,000 (+$41k in 11 days… I guess HAM doesn’t care that the CMHC rules just changed?)
3) Proof that many of today condos will either fall apart (ahem – falling glass) or burn down:
http://life.nationalpost.com/2012/07/16/condo-culture-but-i-dont-want-to-clean-my-dryer/
“After receiving statistics on fires caused by clothes dryers, the board has informed all owners that we are responsible to pay for the cost to have our dryers cleaned. The board has suggested the name of an outside company or we can use a company of our choice. Does the board have the authority to force us to have our dryers inspected and cleaned? I think this could be expensive.”
4) Brad J Lamb apparently still offers 0% down financing??? (didn’t CMHC just ban that?)
http://ontario.kijiji.ca/c-real-estate-apartments-condos-1-bedroom-den-WOW-OWN-THIS-CONDO-FOR-LESS-THEN-YOU-WOULD-PAY-IN-RENT-W0QQAdIdZ396768730
0% Down And Other Finance Options Available!
5) Sales volumes and prices may be falling, but Sotheby’s International Realty reminds us that home sales over $1 million are still growing vs. 2011:
http://dcnonl.com/nw/31775/re
(except in Vancouver, down 35%!)
Watch out Toronto: $1M+ listings in the GTA rose 31% (6193 listings in 2011, and now 8105 listings in 2012). I guess there are a lot of unbuilt $1M+ condos (like this one: http://www.realtor.ca/propertyDetails.aspx?propertyId=12133571&PidKey=164677398) and $1M+ tear-down bungalows (like this one: http://www.realtor.ca/propertyDetails.aspx?propertyId=12166213&PidKey=453190741)?
DELETED
No recession in the US? Think again.
https://twitter.com/PIMCO/status/224923829305221120
Do you fall for Pimco’s manipulation that easily? — Garth
Garth, these people who have written into to you in the last few weeks must be fully on crack cocaine. They are valuing their homes at pre-june conditions when in reality their values dropped an immediate 10% the day F and the boys made their changes. Just try listing instead of looking at “comparable” from 3 months ago and you will get the message loud and clear. Your stuff’s not worth what you think it is or was.
Can’t flip it, can’t afford it. It is done.
What is it about CREA’s “MLS Home Price Index” that makes it a frankenumber?
What has happened to people on today’s blog? Sun flares?
And, no one CARES if you are furrrrst!
If you want reality, take a walk around the West side here in Vanpoover. Price reductions galore, and shell shocked Real Estate “professionals” – wondering where all the suckers have gone.
Anecdotal update. Retail is dying by a thousand cuts in this town. Man, the stores on Granville and along Robson, deader than Mulcair’s brain.
It’s not different anywhere!
Everywhere you go in Canada has doubled or more over 10 years.
Stop telling yourself that. Look at the US whose national home equity declined from 14 trillion to less than half that in 2006-2011.
That affected the whole nation except maybe manhattan.
We have now hit the 153% debt-income sweet spot those Americans hit at their 2006 peak.
And Canadians say it’s different here. So naive!
My comment was fair. A reason would be appreciated.
This is not a gold blog. Psychoanalysis only. — Garth
Oakville’s not a bad little town for down-by-the-lake with a mall. Bit too hokey limey with stuffy bedroom community feel for me. Oakies like to expose themselves new years with the polar dip.
If population growth wasn’t driving the RE market over the past 8-10 years, then there will be crash in RE as soon as psychology turns. It can end no other way. If you’re any good at numbers, there is no other plausible outcome.
However, if population growth is a major factor in the ascent, prices will reach a plateau or slightly correct and may melt. However, prices can’t crash as numbers suggest the probability to be extremely low. Demand for space whether rented/bought will continue. Condos will continue to be rented…etc.
We will see what happens…but Numbers always tell the truth. Words can lie.
#44 Investx
It’s just a long median moving average created to trim volatility after the average price collapses.
[…] As published in The Greater Fool […]
It’s not going to happen in MB:
http://www.theglobeandmail.com/report-on-business/financial-report-exposes-tender-spots-across-canada/article4421538/
Only steady growth.
Check out what the Realtors(R) say:
http://www.winnipegfreepress.com/business/city-house-prices-rise-despite-national-slowdown-how-winnipeg-stacks-up-162033245.html
http://www.winnipegfreepress.com/business/City-house-prices-climbing-at-a-fast-pace-161920615.html
No 30% drop here; it’s going to avoid us.
why be a slave to your home? Just to pick weeds on weekends?,
Rent , and afford to see the world.
The Man wants u to be in debt.
Its the new world order / modern day slavery. New generation of fearful yes bosses.
The meaning is in the word mortgage = mort = death, gage= gauge.
Slavery has always existed, just today ppl choose to be slaves to thier home, then job, them boss etc….modern day full compliance based on the fear of not making the next death gauge payment.
Choose wisely.
HAS ANYONE ELSE NOTICED that the weather is getting a LITTLE HOTTER THAN USUAL lately ?
If you want to learn why, go to this site,
http://timeforchange.org/cause-and-effect-for-global-warming
and look at the second chart named “Atmospheric CO2 at Mauna Observatory”. That one chart alone will show you that its not a ‘natural’ thing happening here. And if you think that chart is bad, the CO2 levels have just his 400 lately:
http://www.ecogeek.org/monitoring-pollution/3776
next time you are walking in a park, just look around and notice how nice and green and healthy all of trees look, that’s normal since CO2 is food for plants.
See how CREA is phasing in the HPI Garth?
July: http://creanews.files.wordpress.com/2012/07/chart-of-interest-e.png
June: http://creanews.files.wordpress.com/2012/06/hpi-chart-2-en.png
May: http://creanews.files.wordpress.com/2012/05/chart_of_interest_hires_en.png
April: http://creanews.files.wordpress.com/2012/04/chart-of-interest-e1.png
March: http://creanews.files.wordpress.com/2012/03/chart-of-interest-e2.png
February: http://creanews.files.wordpress.com/2012/02/chart-of-interest-e.png
If they knew anything about mass propaganda, confusing the public in a downward market only makes things worse.
Understandable…
T.O. Bubble Boy on 07.16.12 at 10:24 pm
– There is no such thing as real estate bubble
“There is only a Fiat bubble. I find it outrageous how some people sill want to convince you that having your hard earned money is better served by investing in some worthless paper equities rather than tangible assets.
Even Germans who are well knows savers are smartening up. Do not listen to wanna be financial advisers like Garth Turner and armchair speculators. If the crash didn’t happen in 2008 there is no way it will happen today. There is a massive escape from fiat currencies.”
____________________________________________
Garth’s no “wannabe” – he’s the real deal (i.e. fully legit Financial Advisor), so the author of this article has performed scant (if any) research! Hey, but it’s OK (and the implication “everyone smart is doing it”) to funnell a very large proportion of your past and future earnings into a very illiquid single asset with big transaction costs (according to the following comments!)
– At a time when this particular asset class is showing (ahem) “weakness” or maybe “growth has temporarily entered a plateau prior to a furture resurgence”.
– Or maybe the truth – “growth” isn’t coming back any time soon, and “erosion of value” is now the new normal.
The rest of the comments in that blog seemed also very pro-housing, anti-financial instruments, so all we can do is wish them luck with their lack of diversification, and hope that their recency bias turns out to be well-founded.
And hope is soon going to be all they have . . . . . .
Does anyone have any #’s/stats on the north okanagan? I’ve been ‘looking’ for 2 years now but have taken the big plunge and moved here now. So, the ‘looking’ is a little more serious now. I’m tired of rentals and b/c i have an investment phobia the $ will likely dwindle down if i don’t buy. this is my 4th rental in a year. I have to say it- I cannot be happy in a rental. Well that’s not the whole truth. I can be happy but i am far less functional (and income producing) when i am not settled. I need the stability. Mind you I am a smart buyer. I do not need granite, or multiple washrooms. Ive looked at shacks and garages. I want value. So, not buying anything unless it is within a very tiny mtge range, has income, or is developable in the future. Right now i have my eye on a shack on almost a 1/4 acre on a block thats being built into apartments. The one i’m looking at is the next in the row that started halfway down the block. I can almost afford an all cash sale so will have a small mtge, and likely hold back a touch for an emergency repair fund. Not a house that i would sink any reno $ into over and above some used bld materials and sweat. Prices and sales here are low i know but can someone give me the whole picture or direct me where to look? I cannot trust the agents. Oh i feel like i need a confirmed or denied Suze here. Is it really that bad if my mtge pymt is around $150- $250 per month? I’m paying $650 rent now which is good but it’s not $150 where i can have a dog and a garden and park where i want.
Parisians and Romans don’t get it!
Calgary is the best city in the best country
in the WORLD!
King Steven said so
I went Kayaking on the Ottawa River today with my family. What a nice spot. Home owners, that are trying to sell, are asking far too much in my opinion. Awesome places but for 20+ minutes extra to get here for work … seriously.
Love the places. But for this much, I’d rather stay where I am and drive 20 minutes once or twice a week and enjoy the river for free and a boat launch/beach close by.
–
“CREA’s frankenumber and humour. They’ll pile into real estate for the most human of reasons, usually for the sake of a family they’re putting at risk. There’s simply no escaping what the next few years will bring.”
Preach on, Brother Garth! Remember, we are the chosen few who will survive the onslaught!
*
Falklands Lots of wind, but no gas; Endless Summer with no economy to speak of; UK RE Down to nitty-gritty time; World economy headed for another perfect storm; Libor You dirty rat! Turning on each other; Pauper’s Funerals Do a Larry Silverstein — take out a massive life insurance policy just before pushing up the daisies; Pensions? What pensions? Wall St. braced for slowing US growth; Be A Shareholder, not a consumer; Retire sooner Other than win the lottery; Financing New Operations? Increase consumers’ costs.
Divorce the forefront? Increasing fiscal security Other that two high-paid permanent jobs, where is the security? Peugeot Hollande to the rescue! Gut Feeling? Wyoming Getting rich? Teaching Kids about banking; Dubai and the Wall St. Boomtown Rats; S&P Death cross? IMF and US Such as WW3? Or Economic Collapse; Nebraska, not Calif. has more muni collapses; Investors’ Paradise The US; Buying Souls?
*
Spoofathon re: Toronto Maple FairyTwinklets. Now You’re Just A Franchise I Used To Know; Deep Purple Jon Lord (keyboardist) passed; To go along with Garth’s pic at the top, this; Anarchism and Chaos Opposite ends of the pole; Law Of The Sea Treaty Maybe that’s why the WH has turned over all of its waters to the UN; Norway At least they’re different than the EZone; Jelly Wobble Tester Strange fish; Lagarde and Sarkozy New corruption scandal; NKorea Infighting? 17:52 clip UFO, one mile diameter confirmed; Ranchers have to sell Wonder if HAARP has been used to enhance the current heatwave? Manufactured Realities Arab Spring, Occupy and Anonymous; Supercharged Lightning.
#34 nocte_volens
Are you in your 30’s or 60’s or did you get a huge inheritance?
Aussie Headlines
More myths vanish
‘The average plot of land in the outer suburbs is [worth] half what it is in the middle suburbs and it is the land that appreciates, albeit slowly on the fringe. The houses they are building actually depreciate. On top of that, the quality of construction is often cheap. So that’s what’s behind the negative equity.’
Say it ain’t so? Aussie homes are built on the cheap? For years property spruikers told you the reason Australian house prices are so high is because of the high quality of Aussie housing.
Six years ago, the Reserve Bank of Australia suggested in a report ‘Australian House Prices’ that the higher quality of new homes added to the overall housing quality in the Aussie property market.
And then in September last year, the Herald Sun repeated something similar:
‘Higher Australian property prices can also be justified by the higher quality of Australia’s housing stock, with renovations and extensions naturally adding value.’
http://www.moneymorning.com.au/20120714/why-the-australian-property-bubble-is-only-the-beginning.html
RE: #19 mattymatt12345 on 07.16.12 at 10:38 pm
Why is that a bullshit story?? Just because you and your circle cant save money and make good financial decisions doesnt mean its not possible. For example I have a buddy high school education making avg wages 20 or so bucks an hr , has over 200k in account plus more in rrsps etc. Dude has a wife/kid and still has a life and can do it.
So ya go out buy your huge truck with huge tires and gas tank to match . Pay a huge mortgage , eat out everyday and buy lots of stuff on your magical plastic cards and then complain why you never get ahead hating on the wise.
Visiting the lower mainland of BC during the weekend. Noticed alot of land, acreages up for sale. Looks just like our county in northern Washington state. Wife and I stopped in some open houses on Sunday. The only vehicle parked at both was the realtor’s car. Again a reminder of what has happened and is still happening with real estate in the USA. What caught my attention was that these homes were occupied by the owners. Confirmed by the realtor. Both house were in excess of 700K but in each one the furniture was at best worth a $100 credit for tax write off as a donation to Salvation army. One even had lawn chairs in the family room. The realtor should have done something about that. Both families must have put all of their money into the house…leaving nothing for any of the finer things in life such as decent furniture. Looks like the stress of bad real estate decisions resides on both sides of the border.
#52 Ty on 07.16.12 at 11:41 pm
“No 30% drop here; it’s going to avoid us.”
Riiiiiiiight… Just like everywhere else, “it’s different here!”
Love how they neglect important details in that report, like how much Manitoba depends on transfer payments, and that the biggest employer is the government (shhh! don’t tell them the gov is slashing jobs left and right, just tell people it’s “growth” but don’t get specific because then they might find out we’re full of crap)
Winnipeg’s market is headed for a crash just like the rest of them.
#20 AL . The economy is far from red hot
Where have u been since 2008? Or course it isn’t hot – for white collar workers in the big cities. Blue collar apprentIce type – still lots of work up north.
#54 ANONYMOUS on 07.16.12 at 11:47 pm
HAS ANYONE ELSE NOTICED that the weather is getting a LITTLE HOTTER THAN USUAL lately ?
No. When I was a kid there where some really hot summers too.
#41 dd on 07.16.12 at 11:08 pm
No recession in the US? Think again.
https://twitter.com/PIMCO/status/224923829305221120
Do you fall for Pimco’s manipulation that easily? — Garth
——————————————————————
Yr buddy Rosenberg is basically saying the same thing.
It’s different in Vancouver. We have a heat wave of 27 degrees now going on 10 days in a row.
Well it looks like Kelowna is toast. Numerous price reductions in all housing types. I live in a walled community and the price reductions are a minimum 30%. Houses that were listed at $299,000 last year at this time are still on the market and reduced to $271,000 and $254,000. They will sell but at what price?
Real Estate agents tell me the market is good. For who, I ask?
The house hornyness displayed by some of the people Garth writes about is beyond me. I’ll go out on a limb and say that it has something to do with an irational sense of insecurity, a need to keep up with the Jones, coupled with the unique thrill of buying an asset whose value has been going up for years. Truly spectacular. I’m hooked on this show and that’s why I read this blog every day.
#50 Canadian Watchdog
A little more than “just a long median moving average” (what is that anyway?)
Everything you didn’t want to know about HPI:
http://www.yattermatters.com/wp/wp-content/images/2012/05/HPI-User-Guide-mls%C2%AE_hpi_user_guide.pdf
Garth, I’m thinking about buying a place in Scarborough. I just heard that the prices there are going down faster than ever due to that shooting. Toronto’s Finest, I’m sure, will be able to apprehend those responsible for such heinous crimes. They always get their money, er, I mean, they always get their man.
Liz: “Our parents both live out of town and haven’t been visiting largely because our house has only one shower and no real space for privacy/guest room.”
They don’t really want to visit. If we want to visit relatives and their house is full, we stay at a nearby hotel. All the privacy we could want, plus fresh towels.
A 20% decline takes my house in Milton back to 2010 levels. Anything more and the pain will really set in. I forecast acute pain in Airdrie, Kelowna, Fraser Valley, Saskatoon. Whistler’s done – has been since the winter olympics ended – maybe they’ll sell it off to a movie studio as in one of those ghost-town firesales. And what’s in Winnipeg to sustain their prices? Pure unadulterated psychology I guess.
There’s a flipper across the street from me who moved in (new build) a few months ago. House has been listed for about 3 months. Initially he let huge patches of his newly laid lawn burn not really caring, because he initially thought that the market was so hot that it would sell within days with multiple offers. After a few weeks of no takers he spent a few desperate hours into the night adding a few shrubs and started to water the laws for hours on end night after night. After two months the desperation showed when he fired the first realtor. I saw a work crew removing carped and padding and take in hardwood. Then he re-listed with a new realtor. Still nothing to this day. He waters the lawn fervently every night now, still for hours. Six homes of the exact same model as his are currently listed within two or three blocks in this brand new neighbourhood. They are all listed at $500K. The builder is still building them and selling for $436K + upgrades. It’s all too sad for me to even go out on my front porch and watch this desperation. Some catastrphe will befall this man if he’s not able to flip soon for asking. Just sad.
Garth I’m not the sharpest tool in the shed but I think Herman is exaggerating his numbers. He bought at peak before the gfc how can his unit be worth 63% more? Is it like valuing the turd I just dropped as the value of food I put in to create it? He must be using listing prices in his building rather than actual sale prices.
$25000 for a shower…….you city people break me up…..haha
oakville is different
:-J
What Herman fails to account for in his own/rent calculation are the following:
1- The fact that he’d have to pay taxes, condo fees and upkeep for the condo if he keeps it rather than renting; and-
2- He’d be getting a return on the crystallized, tax-free capital gain.
This silliness of insisting that renting is money “going out the window” is completely misleading.
Get your profit working for you and see how you feel about renting then.
#75 betamax on 07.17.12 at 3:22 am
“They don’t really want to visit.”
Exactly — that was the first thing I thought when I read Liz’s story. I’m surprised that no one else suggested it before your comment — I guess the people who post here are just too polite ;)
Cheers,
John
The stupid is epic today. So… couple A who want to buy a house so their parents can visit. And, to further this noble goal they’ve spent 4 years obsessing over real estate and carefully monitoring housing prices? Really? No one here is planning to pregnant accidentally on purpose? No one is worried about impressing their friends/parents with their visible wealth? For the price of A HOUSE you can fly your parents in, put them up at a hotel and limo them to your door many, many times. You are seriously kidding yourself about your motivations here. Once you figure out what you really want, your choices will hopefully make more sense.
Person B, who would like to trade in one condo for the identical condo 2 years later and can’t figure out why that would save him money. First – do you actually like living there and can you afford it? If so, stay put. You used leverage to purchase and prices have a long way to fall to wipe out your gains. If, however, you don’t like where you’re living, take the free $200,000 (which is what percentage of mind-boggling return on your actual down payment?) and then do something else with it because – as you have accurately figured out – housing takes time and commissions to unload. If you think that bites into your capital now, imagine how easily it can eat your downpayment. DON’T buy the exact same frikking place in 2 years. In that timeframe, miracles would have to happen to make up for the killer fees. In two years, alternately, you could meet someone and start a family, move to a new job, travel the world, start a business and otherwise do the amazing things that someone young and flush with cash can do…
#1 Furst
You reached new highs Furst! Not only posting another gem of a poem but making it the first posting of the evening. Now that’s good! You will be given a hero’s welcome at the SASTPGFBDCParty. The fighting in the park now is over who will pick you up at the airport. Well done once again and keep ’em coming Furst!
#77I’m stupid…….. I was thinking exactly the same, must be asking price numbers!
I just love the T.D. numbers. A 10-15% drop over the next 3 years. I don’t think so! More like 15 to25% on S.F.H. And 25 to 40% drop on condos.This should happen in the next 1 to 2 years depending on what it is and where it is. Click on to MLS and take a look at all those red dots. I’ve had my laugh for the day.
Thanks, Garth.
I’m listing.
— Herman
Good morning blog. What a pleasure it is to start the morning with a dose of Garth and the usual suspects in the comments section.
Although you likely get these sorts of comments all the time, please devote some of your watchful eye to the Montreal market. We have an interesting dynamic with our perennial moribund Quebec economy and surprisingly, quite a swath of “old” money that keeps certain markets afloat.
Also, your site could benefit from an additional tab detailing any events you will be attending. I’m sure it would help drum up attendance.
Best Regards,
Montreal_CA
So, is Charest toast? — Garth
So, is Charest toast? — Garth
Only if he cannot succeed in painting Marois with the activist brush. Wearing that red square is bound to cost a few votes. Quebec Solidaire is likely to pick up more than a few seats as well as they are a good “let’s give them a chance” party though their leader can be similarly painted as well. Probable minority government I would say.
The funny thing is that the more it looks like a non-Liberal party will win/do better, the better voter turnout is for the Liberals. Too many memories exist from the last few time around. Some of my colleagues are actually hoping for a PQ win so they can snap up Westmount property on the cheap.
A new King West building (my area).
Look at these new condos’ impossibly tiny size. Asking 340-370k…
Condo fees already at $300/mo, building just opened up. They’ve sandwiched two buildings, side by side, in between existing low rise buildings. Most condos look into another’s balcony or on to a brick wall.
http://www.realtor.ca/propertyDetails.aspx?propertyId=12211328&PidKey=776461827
http://www.realtor.ca/propertyDetails.aspx?propertyId=12211316&PidKey=-194700216
http://www.realtor.ca/propertyDetails.aspx?propertyId=12211315&PidKey=1197432729
Shame! Fudging numbers to prove a point? Where can you get a $1000 return on a $200k investment ? And that too after tax dollars to pay your rent? Get real Garth! You now come across as someone full of it. Oh, by the way, no matter how inappropriate the post of the Brampton listing, the property was over priced to begin with. A correction was made and the bloke trying to sell it alluded to the fact that the owners were desperate to sell. Hardly a good example of a housing decline. Sensational articles may probably help you sell your next book.
Looking to see if you moderate my comment out like you did my first post.
An investment of $235,000 all in dividend-paying blue chips or bank preferreds will yield 5%+ these days, payable in dividends, allowing the dividend tax credit. Add in some REITs like Morguard or Dundee (yield 5.7%), and you have income of $13,000 a year or a grand a month. Your first post was eliminated because it was incomprehensible. Now work on that attitude. — Garth
Do you fall for Pimco’s manipulation that easily? — Garth
I agree with you on PIMCO, however, The U.S. and the global economy is slowing and U.S. will be in recession the second half of this year. Unless of course you believe QE3 will be the answer. Now QE is manipulation.
While I doubt the US recession scenario, if it does happen, so what? A few quarters of negative growth will pass without consequence. — Garth
Talking with an educated, almost old timer yesterday evening , the topic of investing in real estate verses financial markets.
He made kind of an obvious point.
His point was that despite the cycles in both, both on the way up and on the way down ( equities up in the 80’s and 90’s RE up past 12 years or so) you never seem to find many millionaires who have made their money in financial markets but a whole slew of them who have in real estate.
Now there all kinds of reasons for this I’m sure but his point was pretty accurate.
I told him buying now in Canada is a gauranteed losing proposition and his response was to come back in 30 years with same analysis of RE comparison to financial markets and see what results look like.
He believes will be pretty much the same.
While I doubt the US recession scenario, if it does happen, so what? A few quarters of negative growth will pass without consequence. — Garth
Garth, please define ‘consequence’. Seems like negative US growth will increase/accelerate repatriation of jobs (ie out of Canada) and slow spending (affecting consumption of resources) both of which will have consequence here. Less work for Canadians means more downward pressure on real estate.
At the risk of invoking your ire, what am I missing?
Carney holds rates stance … I would have raised rates it if weren’t for those meddling kids.
Dear Homeowner,
My Name is Xxxxxx Xxxxxx, and I currently sold my home and I’m looking to purchase a home in your townhome complex. We are willing to pay fair market value for your property and would prefer the 3000 square foot floor plan. Our moving dates are flexible however we would prefer to move in by September 7 2012.
I’m hoping to avoid the cost of the real estate commission being added to the sale price therefore I’m contacting the homeowners at your complex directly. I am familiar with your complex and your floor plans and would be very interested in speaking with you if you are seriously considering selling your home.
Please feel free to reach me at 555-555-5555 to discuss your situation. Our family is looking forward to hearing from you.
Regards Xxxxx Xxxxxxx
Now when I got this letter I thought was a bit strange, but when I googled the name, the first webpage that opens is a Realtor. WTF, realtors don’t like real estate commission being added to the sale price? Would a letter like this be illegal form a licensed realtor, and would the agency like to have this forwarded to their office? Should the person not be disclosing the fact they are a licensed realtor in a letter such as this?
While I doubt the US recession scenario, if it does happen, so what? A few quarters of negative growth will pass without consequence. — Garth
—————————————————————-
Just to prove your predictions are not always correct is satisfaction enough.
#91neo
“Now QE is manipulation”
Really? Why?
Nice to see that Victoria will be ‘spending’ on a sewage treatment plant as opposed to Van Crapper which still pours over 800 million liters of raw untreated sewage into English Bay, Vancouver Harbour and False Creek every day.
http://www.vancouversun.com/news/local/Three+governments+announce+deal+Greater+Victoria+sewage+plant/6941547/story.html
Vancouver is so ham strung with legacy civil servant contracts that 100% of the tax revenue gets pissed away on pandering….shame. I guess thats why civil servants never retire in Vancouver…….they’ve turned it into a sewer for uninformed refugee’s and the destitute left laying in the streets after the union steam roller has crushed their dreams.
http://www.bucksuzuki.org/images/uploads/docs/Hidden_Killer.pdf
Wages and pension perks over the environment and human health……thats the civil service for you.
Haha, we got an ‘inheritance’ so to speak. We cashed out some stock options from the big corp that we work for. Easiest money we ever made. Now I know how Mitt Romney felt when he retired from Bain while still being paid 6 figures. But I digress.
We saved all of that and we also have a business that we run part-time of which we save all the profits into a corp.
We enjoy the income diversification and our SFH that will be paid off (pre-paid out of our main salaries) this year.
Currently 75% RE / 25% liquid assets but I’m still under 40 so there is plenty of time to work on that ratio with no mortgage starting in December.
Yes, please do a post on the greater Montreal area, I know the condos are toast, but what about SFH. Thanks
Oakville, Oakville, Oakville……that’s where I call home! :)
I think Oakville RE prices are going to either stabilize where they current are, or slip minimally, say 5% at most.
Why? Real Estate is a far better deal than Toronto, and Oakville has decent GO Train service including manageable commute times into Toronto. Oakville GO Train Station is the 2nd busiest station in Ontario, it works! Oakville is also a much more desirable place to live than Brampton, more mature areas and properties, and way less CONGESTED than Brampton. If you stay away from East Oakville, where I agree the prices are crazy, and stick around West Oakville, you’ll find more reasonable prices for homes, on large lots, with mature trees.
Cheers, Mel.
Aussie Headlines
Call from Economist for a “Big Australia policy”
aka – Please import more greaterfools
The issue of an ageing population will need to be addressed at some point irrespective of the level of immigration. Simply importing more workers to cover the retirement of the baby boomers only delays the ageing problem, pushing the problem onto future generations.
What will be the population boosters’ solution in 30 years time when current migrants grow old, retire and need taxpayer support? More immigration and an even larger Australia? In this regard, a “Big Australia” brought about by high immigration is just another ponzi scheme.
http://www.macrobusiness.com.au/2012/07/more-failed-arguments-for-population-growth/
So the parents don’t come to visit because no second shower or guest room? Seriously, take them to Hawaii for a week. You get some r & r and everybody gets fresh towels everyday. You’ll be a hero and you don’t have to sell the farm.
#92 bigrider on 07.17.12 at 9:01 am
“Talking with an educated, almost old timer yesterday evening , the topic of investing in real estate verses financial markets.”
_______________
Buying a house is easy, any dummy can do it.
They go for the look, location and of course emotion.
Investing in financial markets require doing your due dilligence. 95% of investors don’t have a clue.
That would include accountants, lawyers and such.
Don’t be plugged up. Learn and do your DD.
Fundamentals.
There are huge bargains and potentials in the current markets. Stop whining.
Predictions made by people/companies with a vested interest are ALWAYS biased to their best interests. So if home owners, governments, and (gasp) realtors are predicting any type of slowdown or drop in prices — we’re in for it.
Come to Alberta and ask anyone who works in the oilpatch which direction the price of oil will go and the answer is always up.
Having no room for the parents to visit — in my house that’s not considered a negative.
M.C. Understandable…?
Gold is only the canary in the mine or a symptom of the disease…. The Macro view is always appreciated but at the end of the day the relator did not hold a gun to anyone’s head. Lying is not a prerequisite for been a relator but I guess it helps…. For the love of truth we all lie. Just look at your resume (generally speaking Garth). What we’ve become is a society made up of people who know not the value of accountability for one’s actions but one’s ability to point the finger or pass the buck… professional victims. Just look in your medicine cabinets if you don’t believe me. Ten commandments but 1.5 million laws to up hold them because no one believes they apply to them. O.J. can attest to that…. Not a Gold blog?? No, you’re an environmental blog #54 Anonymous. The potential for diversity within this Pathetic Blog is only limited to the idea that are we educated or indoctrinated?
http://www.torontomls.net/PublicWeb/CL_PM.asp?link_no=223616426.572000&t=p&fm=F
Seriously??
#73 Devore
(what is that anyway?)
1) Take an average prices series and formulate a rolling 6 month median
2) Convert prices into an aggregate index
3) Homemade HPI http://postimage.org/image/40yrga2v7/
#23 Sp
People do not like places like Brampton for different reasons. Who are you to judge them what to like or not to like? This is a free country and people can express their opinions the way they want, be fair. A lot of you Bramptonians are a lot more racist than an average Canadian is. Do not dare to say it is not true, i have a lot of Indian friends and they do accept that as fact. Why else would they congregate only in their own crowds and speak their own language and laugh at the other people?
# 104 EagleBay to Bigrider.
I doubt you can do your own DD in financial assets as you have clearly demonstrated an inability to read a post.
What part of my post would you determine as whining??
Older guy I quoted made an observation.. That observation would be easily confirmed by both RE bears like me and bulls alike.
Let’s face it, a lot more wealthy people in Canada due to RE than financial markets.
I leave it to you and the blog to conjecture why.
#101 Mel Eager
West Oakville behind Hopedale mall, just around the corner from the most god awful 1960’s welfare housing. I just don’t see where the bargain is.
http://www.realtor.ca/propertyDetails.aspx?propertyId=11921874&PidKey=-1348974738
Gotta love the slate tiles on the walls and the IKEA closets….$100 000 in upgrades?
Sorry Mel Eager. Oakville is turning into a rich poor man’s slum. Makes me sad, grew up in this town and what I’m seeing is nothing but over extended families unable to keep up with their properties and dirty rigging their homes for a greedy sell.
#102…..AR…….I ran into a young aussie from perth here in texas….he tells me interest rates are above 12% on residential mortgages……..average homes an hour out of the city are asking 1/2 mill…….s’truth?
I spent 6 months in oz a few years ago…the cost of living is outrageous…..wtf?
#101 Mel Eager
I too live in Oakville. Have for 24 years. Owned 2 houses but became a renter a year ago. Took my money out of the market then because it did not look like the market was sustainable. Of course, I may have been off by a year but still feel it was the right decision for us. Don’t have to worry about what the market does next.
The sprawl in North & West Oakville is mind-blowing and about to intensify even more as the lands north of Hwy 5 are developed. The density will be even greater than in West Oakville. Population is nearly 2.5 times greater than when we moved there in 1988. Lot sizes are shrinking. Levies and taxes have added nearly $100K to the price of a new house in the past couple of years. No more house for your money, just a more expensive one. House prices and property taxes are high.
Even driving along Lakeshore Rd and there are plenty of FOR SALE signs these days. The old money is leaving and probably plenty of the new money is borrowed.
Sorry to say but it’s not different in Oakville.
The shiny glossy Prestige RE guide appeared in my mail. It’s a free mag that shows off high end homes for sale.
It’s RE porn.
Funniest thing was a home listed for $5.9 mill in Vaughans Weston Downs area ( for Woodbridgians, that’s ‘behind the wall’). It features all the upgrades and a pool, bar with Roman columns in the yard. Shame that the separation between this home and it’s neighbor is a mere 8ft. But the photos use that nifty stretch app, to make everything seem bigger.
Oakville homes seem to have dropped from the high $5 mill to now $3mill. Still over valued.
Then there’s some RE guy, Barry Cohen, offering to build a home for you near Post Road…not the good side, but west of Bayview near York Mills. All for only $15 mill!!! For $15 mill, Barry, there’s more I can get for the money then a Tudor money pit w/ your love for cheap moldings. But then again, Barry sold another home nearby to a big developer who paid $5mill. Who claimed he couldn’t build it for that amount….ehem, even all the developers pals thought he was insane and full of it. The average house in the area sells for $2.4 mill. and the $5mill job, had a 70’s ranch on it prior, and was bought for $900k. And it doesn’t cost $4.1 to build, unless all your fixtures are gold.
House lust, house porn. It’s blinding people
#112 This is Wonderland
Completely agree with you. Looked at the listing. Hey, it looks like a nice reno but at $686,500 they have got to be kidding. Not even a garage for that kind of dough.
Listing says “Where million dollar homes emerge”.
And I say where greater fools rush in.
Why do we have a RE bubble in Canada and had one in the U.S. before it burst? Because we have a credit bubble? Seems like a rational explanation to me! A RE bubble has its causes and doesn’t appear out of nowhere in isolation. If so, what is the result? The RE bubble bursting in Canada will not be in isolation.
While I doubt the US recession scenario, if it does happen, so what? A few quarters of negative growth will pass without consequence. — Garth
Here is another author who has a different opinion:
http://www.cnbc.com/id/48193471
And he’s wrong. — Garth
While I doubt the US recession scenario, if it does happen, so what? A few quarters of negative growth will pass without consequence. — Garth
Well, for starters they never got out of the first one. Second, the “fiscal cliff” is approaching so there is fiscal constraints. Third, the monetary response won’t be usefull since rates are already at zero and QE is having diminishing returns. Fourth, this is a global slowdown not just a U.S. one which complicates matters.
You doubt a recession the second half of the year based on what? Wishing it so? That is foolish commentary saying the U.S. can be in recession for the rest of this year leading into 2013 without consequences.
For starters, you’re wrong. — Garth
#92 bigrider on 07.17.12 at 9:01 am
“I told him buying now in Canada is a gauranteed losing proposition and his response was to come back in 30 years with same analysis of RE comparison to financial markets and see what results look like. ”
While you could still say that buying a house and holding it for 30 years may not be a losing gamble, I would argue that that scenario is very uncommon. The risk of buying into a falling market is that you may be forced to sell long long before the recovery.
at #97dd on 07.17.12 at 9:34 am
#91neo
“Now QE is manipulation”
Really? Why?
*****************************************
Do I really have to explain this to you? Your being facetious right?
people here are still talking about buying and flipping in the movie world here in Vancouver…
just did a job in maple ridge…. 10 carpenter types looking at a $474,000.00 dollar lot and another one next door…
its a tear down… and they still are talking about building and how they could make a cool $100 grand building a piece of shit out here…
did I mention all the private for sale signs all over the area…
movie people are so stupid… there’s over 10,000 barely working even with a tax kickback to the producers of 40% of the wages paid there is no work to speak of… coming…
here’s a group of property horny idiots who are in big trouble.
One guy actually said he’s worth a million dollars.. he only owes $500,000.00 on his properties.
… and there will be more renters because of a lack of people who can afford properties due to the new rules…
If they can’t afford to buy how can they pay current rent on newly bought properties… they are all buying condo’s as rental properties… and you know interest rates have never been lower…
Oh Good Lord…
“Debt” is …. “Equity” I was told…
Rising assessments let us borrow more so we can buy more property…
Double Oh Lordey…
Silver
For starters, you’re wrong. — Garth
HAHA. Even more profound commentary from you. That’s your rebuttal to the truth? Ummm ok. Well someone will be eating crow shortly. Would you like that medium rare or well done?
Your first premise that the US never left recession is, technically and statistically, wrong. How hard is that to understand? — Garth
July mid-month data is 416 inventory property price changes reported on Guava.com only and does not reflect entire GTA market.
All Listings
# of Price Changes 344
Average Home Price $828,094
Average Change ($53,478)
Reduced % -7%
$2+ Million
# of Price Changes 21
Average Home Price $2,714,667
Average Change ($164,619)
Reduced % -6%
$1-2 Million
# of Price Changes 55
Average Home Price $1,383,074
Average Change ($133,753)
Reduced % -10%
$750K-1 Million
# of Price Changes 52
Average Home Price $850,058
Average Change ($54,522)
Reduced % -6%
$500-750K
# of Price Changes 95
Average Home Price $620,412
Average Change $29,043
Reduced % -5%
$400-500K
# of Price Changes 70
Average Home Price $461,035
Average Change ($18,729)
Reduced % -4%
$0-400K
# of Price Changes 51
Average Home Price $321,031
Average Change ($13,287)
Reduced % -4%
“For Starters, you’re wrong”
Made me laugh…ah, that’s why I love this blog, always an adventure.
Regarding US economy – agree they’re still in bad shape, which hurts China … Europe is in bad shape, which hurts China …
15 years ago, it was all about Japan, they crashed, now it’s all about China, there will be a crash there soon too … I think we’re in for turbulent times in 2013.
Let’s face it, a lot more wealthy people in Canada due to RE than financial markets.
I leave it to you and the blog to conjecture why.
The boomers moved through North American demographics like a pig in a python. They put it in real estate.
#64 Dawise
Woooo, calm down buddy! That ain’t me! I don’t waist! I’m doing alright. Just not in a financial dream world like all the people who write into Garth.
Put a fork in it, the US is done. Labor is totally fungible now – it’s merely a commodity. Combined with a world awash in capital, the US has ZERO competitive advantages – all the advantages that were priced in post WW2 (access to tech, capital) are gone.
Canada’s saving grace is the fact it is a natural resource processing zone. Nothing more than that, as this at least can’t be outsourced.
So….the US will in fact be in a permanent contraction (death spiral) for a long long long time Get used to it!
Gold bugs are the only people in the world who use that word. Fungible. — Garth
Garth, thanks for your educational writings, which are a catalyst for all kinds of comments. Said comments always present a whole gamut of emotions and an inside to several ways of thinking and reactions of your readers. Allow me to relate one of such reactions. Talking to a young man, he ask me if fiat money is something he have to save for repairs of a 500. Because he was thinking of withdraw some money from his “hello” account to buy one. After explaining it to him; I suggest that he did not talk to much about it or people will laugh at him. He said, yeah that what happen since he was a kid; after somebody gave him a turtle and she escape from him. But after a while, with a twinkle in his eyes, he said, but I do get lots of Oh God! in bed.
Spoke with a friend of mine this weekend who is a realator in downtown T.O. He is selling a house in Rosedale that was put on the market 3 weeks ago. He said that in the past two weeks it is like the tap of buyers was turned off. NO ONE is wanting to look at the property….he says, 2-3 months ago there would have been bidding wars on the place. Remember this is ROSEDALE….I didn’t expect things to go south so quickly in a prime market.
@ #99 CalgaryRocks,
You have done ok. I’m also in my 30’s and have about $350,000 higher net worth than you.
Liz’s story is depressing. But common. Every time I turn HGTV and one of those house buying shows is on, I constantly hear about “needing” that spare bedroom/bathroom for “when people visit”. Whether it’s their home, cottage, or a vacation house. Of course, they end up visiting once a year, because they don’t like going to the same place all the time, and then not at all, because something came up.
I’m in a 1 bedroom apartment, and friends and family (even parents!) out of town (and out of province) visit me all the time. They sleep wherever there happens to be room, on the couch, on the floor on a tent pad, because it’s free. They don’t seem to care about privacy, guest rooms, or extra showers.
For the price of buying, heating, cooling, cleaning, furnishing and maintaining an extra bedroom/bathroom, you could put up your visitors in a hotel and hire a limo to chauffeur them around town full time, every weekend for years to come.
There are obviously other motivations for wanting to buy a much bigger place, and there are other motivations for not visiting. Maybe if Liz’s parents had some grandkids to visit, they wouldn’t give a flying f**k if their bath towels are touching hers on the towel bar.
We are suppose to quit whining and compete whilst others seem to prefer to do the opposite.
…”Under the leniency programs of the EU, companies may get total immunity from fines or a reduction of fines which the anti-trust authorities would have otherwise imposed on them if they hand over evidence on anti-competitive agreements or those involved in a concerted practice.”
It makes one wonder who really was living beyond their means ? The balance sheet brightners or the people who were sold rigged loans. Such co-ordination and co-operating ! Such teamwork!
” Los Angeles has sued U.S. Bancorp, accusing a unit of the fifth-largest U.S. commercial bank of becoming one of its biggest slumlords and blighting the city by allowing hundreds of foreclosed homes to fall into disrepair.”
Read more: Deutsche Bank Gets Prosecution Witness Status in Rate Probe
The case is People v. U.S. Bank NA et al, Superior Court of California, Los Angeles County, No. BC488436.
(Reporting By Jonathan Stempel in New York; editing by John Wallace)
http://www.reuters.com/article/2012/07/17/us-usbancorp-losangeles-idUSBRE86G0P620120717
Diversification doesn’t mean jack if it all goes to hell due to short selling and other market hanky panky.
What is needed is something that can’t burn, has no counter party risk , won’t go to zero , doesn’t require debt to buy and can appreciate in value.
“Liz is more typical of people than may be apparent looking at the rabble of malcontents, iconoclasts, anarchists, voyeurs, basement-dwellers and the occasional nazi who frequent this pathetic blog. She covets a fat house and is willing to take financial risks to get it because she wants another shower (a $25,000 reno, at most) for parents who come once a year.”
—–/
Yeah, I’d say some of that is true. Liz is in a tiny reactive world of isolation and a-political irresponsibility. She doesn’t know what’s going on outside her WANTS and hasn’t begun to look at the big picture and her real needs. Personal, family and community. What interfaces are actually going on?
So. Say she jumped on the net and got informed. Using common sense. Got a box for that?
Because in your paragraph above I don’t think it’s included.
far from the truth hammer
”Van Crapper which still pours over 800 million liters of raw untreated sewage into English Bay, Vancouver Harbour and False Creek every day.”
vancouver’s sewage has been treated since the early 1960’s or whenever the iona island sewage plant was built.
I dont think anyone in the greater vancouver area is doing so.
http://en.wikipedia.org/wiki/Iona_Island_%28British_Columbia%29
http://www.metrovancouver.org/services/wastewater/treatment/Pages/treatmentplants.aspx
http://www.waterandwastewater.com/plant_directory/Detailed/336.html
Will RIM be ok?
Put a fork in it, the US is done. Labor is totally fungible now – it’s merely a commodity. Combined with a world awash in capital, the US has ZERO competitive advantages – all the advantages that were priced in post WW2 (access to tech, capital) are gone.
Canada’s saving grace is the fact it is a natural resource processing zone. Nothing more than that, as this at least can’t be outsourced.
So….the US will in fact be in a permanent contraction (death spiral) for a long long long time Get used to it!
Gold bugs are the only people in the world who use that word. Fungible. — Garth
@Garth –
Fact is, the second the US went off the gold standard, they also lost the core reasons they had been successful up to that point. (re-read my post) The US has been living off debt ever since.
I’m no gold bug, I just want my future kids to live in a stable society.
Looks stable to me. — Garth
DELETED
#78 cropgrower on 07.17.12 at 5:52 am
$25000 for a shower…….you city people break me up…..haha
a shower that I was acquainted with was most rudimentary. and came in way way cheaper than 25 g’s
hot water was plumbed alongside an outside cold water faucet attached to the house that had a decent view of the water….
next a short length of hose to an adjustable lawn sprinkler and a wooden pallet [a lovely oak pallet suitable for heavy machine parts] to stand on and voila.
a shower with a view of texada island.
Shame shame on Nissan..
How can I drive my family around from Brampton without a new car… ????
Yes Brampton seems like Surrey BC. NOT South Surrey where the Europeans live, but Surrey, where the 3 suites per house is the norm.
Anyway, check this out, realtors are now working for NISSAN!!!!! Compare for yourself….
1 – *** 38 mpg as advertised on TV ads***
2 – 38 mpg as per this press release by the EPA
http://wot.motortrend.com/2013-nissan-altima-rolls-off-line-in-mississippi-will-get-38-mpg-highway-215123.html
VS.
3 – However, just like Brad Lamb and Bob Rennie, when you visit their site, truth is irrelevant.
Apparently, magically like Real Estate, mpg always goes up…
58 mpg on their webpage
http://nissan.ca/vehicles/ms/altima2013/en/features-performance.html
So there is no truth necessary in advertising if you put an asterix next to the claim!!!!!!
Brad Lamb, you taught Nissan.ca well. Truth is for suckers, seniors, and Capital Direct customers.
No different that a Moody’s credit rating, it’s all subjective.
54 ANONYMOUS on 07.16.12 at 11:47 pm
not as warm as the roman or middle age warm spells.
and the warm spell that melted the 2k of ice that used to cover Vancouver must have been something eh?
http://muller.lbl.gov/pages/iceagebook/history_of_climate.html
Your first premise that the US never left recession is, technically and statistically, wrong. How hard is that to understand? — Garth
Ok. So $1.5 trillion deficit spending a year or the equivalent of the Canadian economy as well as a Fed Balance sheet of $1.6 trillion as well as TARP, QE1 and QE2 and in Q2 this year, four years later we will be lucky to print 1.1% on GDP. Demand has never come back. The real economy has never recovered. The technicals and statistics are all skewed by the intervention. No one right now in the business media is talking about the economy improving, just more stimulus to keep asset prices artificially high. How hard is that you for to understand.
Recession is negative economic growth. Fail. — Garth
bain damage -lol retired retroactively age
horse prom is black tie
http://www.ctv.ca/DailyShowwithJonStewart.aspx#clip721746
Here’s the greatest doomer…
According to author and investor Peter Schiff, the U.S. economy is heading for an economic crash that will make 2008 look like a walk in the park.
http://finance.yahoo.com/blogs/breakout/america-heading-towards-collapse-worse-2008-europe-says-155504860.html
RE: #110 from Brampton on 07.17.12 at 10:53 am
“… i have a lot of Indian friends and they do accept that as fact. Why else would they congregate only in their own crowds and speak their own language and laugh at the other people…”
haahaha thats funny. sounds like the chinese out west.
think your a bit sensitive about people “laughing” at you. perhaps they are just happy to see you!!!
at #123Canadian Watchdog on 07.17.12 at 12:21 pm
July mid-month data is 416 inventory property price changes reported on Guava.com only and does not reflect entire GTA market.
Is the average change from July mid-month 2011?
Gold bugs are the only people in the world who use that word. Fungible. — Garth
Really!? And I thought it was a real estate term that agents use to describe a crack house.
Canada is country of bubbles: real estate bubble and emigration bubble.
Emigration is the biggest Canadian bubble, Ponzy scheme, pyramid.
To feed emigrants Canada needs more emigrants etc. until it will be explosion.
I’m emigrant by myself and it was the biggest mistake of my life to come to this frozen tundra, called by historical mistake “the state”.
There is no such country as “Canada” – it is northern mirage, well maintained bubble to make money.
BTW..By your definition the three consecutive months of negative retail sales we’ve had when the consumer is 70% of the economy could be defined in your terms as a “recession”.
Recession is negative economic growth. Fail. — Garth
You are now embarrassing yourself. — Garth
Canadian Watchdog #123
Don’t know where you find all the stats but good job and really good posts
“So I carry on, and will not stop.”
*whew* good to hear Garth. A few months back I thought you were ready to pull the plug. Very glad you will be sticking around.
Thanks for spreading sensibility.
Someone said this just a few days ago on this blog: No one is content with what they have. If people get a raise, the majority will up their lifestyle, not save it. I am sure that house in River Oaks has a basement where a nice 3 piece bath could be installed but they have a lot of money and they just want a bigger house.
So many choices – do what Garth says – $1000 a month return – wow!!! Buy a semi or detached in Oak Park for $450-$500 or big monster house for $650-$750. What is that $200,000 saved for? I think this couple is doing extremely well and could even use their town house as a rental whether they decide to buy another house or rent one or they could travel the world if you wanted to. Depends on their personality and their goals!
“She covets a fat house and is willing to take financial risks to get it because she wants another shower (a $25,000 reno, at most) for parents who come once a year.”
——-
This is a great one – the flip side of the irrational boomer logic against downsizing so that the kids and grandkids will have a place to stay when they visit once a year. Has no one ever heard of hotels? Or how about the ‘need’ to have a large dining room and table that can sit 20 people because you host the family Christmas get together every couple of years. They are only excuses to justify largely irrational desires.
Take my parents – they wisely sold their McMansion in Surrey years ago and moved into a townhouse mortgage free. But the ’emotional strain’ of not having extra bedrooms for the grandkids, a large garage, a basement, and needing off-site storage for all the stuff they couldn’t bring themselves to get rid of caused them to go on a reckless journey resulting in 4 moves over 6 years just to end up with something that’s a quarter of the house they used to have for the same mortgage amount they were trying to get rid of in the first place. And the last purchase/move they made was just last year, arguably the top of the market here in the LM, with my dad just a few years away from retirement. All that just to have extra room for the kids and grandkids when all of us live within a few hours of them anyway.
Willard wrote:
“To bad so sad!!!! The end is near and I thank you garth for saving me!
SWEEEEEEEET!!!”
——–
1. No power position
2. Escaped one major ponzi trap
3. No mention of value offering
4. Unconcerned about others
5. Sees “economics” as win-lose
6. Thinks “have and have not” is fine
7. Believes “the government” will protect assets
8. Believes the “law” is grassroots, mainly for citizens
9. Knows nothing about world politics and economics
10. Identity of “something for nothing”
You can gloat all you want, but in a “correction” a lot more would have to happen than you are currently thinking.
Maybe nothing will happen right now. Maybe “they” will stretch “it” out longer. Any ideas on who “they” are, and what “it” is?
cash back as “gift”–along with false loan applications and phony income verifications – he also persuaded nonprofits Nehemiah Corporation and Home Downpayment Gift Foundation (of Michigan) to pay the buyer’s cash-to-close obligations. Often these companies will make the payments in return for a charitable donation. Who makes the donation? Often the seller.”
http://www.justice.gov/opa/pr/2012/April/12-crm-488.html
..According to court documents, from approximately February 2006 through July 2008.
The borrowers Curbelo assisted at these two complexes were unqualified to obtain mortgage loans due to insufficient income, high levels of debts and outstanding collections.
Curbelo admitted that he conspired with others to create and submit false and fraudulent Federal Housing Administration (FHA) mortgage loan applications and accompanying documents to a lender on behalf of the unqualified borrowers. Curbelo and others offered the borrowers cash back after closing as an incentive for them to purchase the units. These payments were not disclosed properly during the loan application process. According to court documents, the closing costs were paid on behalf of the borrowers by interstate wire. After the loans closed, the unqualified borrowers failed to meet their monthly mortgage obligations and defaulted on their loans.
According to court documents, when the loans went into foreclosure, HUD, which insured the loans, was required to take title to the units and pay the outstanding loan balances to the lenders. As of the date of the plea agreement, the actual loss related to Curbelo’s conduct that was paid by HUD was more than $6.5 million.
Anyone who doesn’t think a 5%+ return in balanced portfolio is possible is only showing their own financial ignorance.
…four years, ending in July 2007 when the FBI executed seven search warrants in metropolitan Detroit and Florida. The scheme involved obtaining “real” loans and, in many instances, “ghost” loans, from mortgage lenders. “Real” loans were closed at the offices of a legitimate title company, and the related warranty deeds and mortgages were properly recorded at county registers of deeds. However, the loan application and other related documents were materially false and fraudulent in a number of ways. The borrower described in the loan application was not the true borrower but merely a straw buyer with an acceptable credit history who was recruited to assume that role for a fee. Any down payments were paid from proceeds of the scheme rather than from the borrower’s own personal funds. Verifications of deposit, when provided, were fraudulent because the account balance disclosed to the lender was artificially inflated by a temporary transfer of funds into the account from other participants in the scheme. The income of the borrower was in most cases inflated. The “ghost” loans were used to obtain additional funds from mortgage lenders. The home sales that the “ghost” loans were supposed to finance were nothing but sham transactions, purporting to be secured by the residential properties purchased with the “real” loans. The purchase agreements and other closing documents were counterfeit. No legitimate title companies were involved. The warranty deeds and mortgages associated with the “ghost” loans went unrecorded, leaving the lenders completely unsecured.
Over the four-year period, the scheme involved more than 500 fraudulent mortgage loans, over 100 straw buyers, and approximately 180 different residential properties in metropolitan Detroit that were used as — or falsely represented to mortgage lenders to be — the collateral for the loans. Most of these loans went into default and foreclosure. The loans ranged in size from roughly $350,000 to $600,000. Losses to the lenders resulting from the scheme are expected to exceed $100 million.
I’m no gold bug, I just want my future kids to live in a stable society.
Looks stable to me. — Garth
Sure does. Only because we are committing wholesale theft against future generations.
But, sure, defined benefit pensions for all! Let’s see how fast we can steal from the future generation.
The problem with the condo market is that the rents are too low! A true AHA moment (for a Remax).
How embarassing.
http://www.remaxcondosplus.com/blog/what%E2%80%99s-wrong-with-the-toronto-condo-market-answer-rents-are-too-low/
More new projects in Montreal, some of them really cool…
They will be built and they will be sold.
http://journalmetro.com/actualites/montreal/123367/la-tour-des-canadiens-misera-sur-les-amateurs/
Go Habs Go.
No Garth No.
If you strip out the top one percent in Oakville that city is one of the poorest in the entire country. Maybe the poorest in all of southern Ontario where the average car on the road is more than 15 years old. Who would possibly want to live in Oakville? I don’t think there’s even an answer for that one. Why some people want to give back all their tax free money who knows and then of course the goof will sell when he hits the “break even point” cursing the fact he didn’t sell near the peak.
Garth,
With respect, there are a number of people who believe the US is now in recession. The ECRI is calling for one in the Fall as well.
See the link:
http://www.ritholtz.com/blog/2012/07/the-weakening-economy/
A recession is two quarters of negative growth. Has not happened. But if there is a recssion, who cares? It will pass. — Garth
#49 TRT,
You said,”If population growth wasn’t driving the RE market over the past 8-10 years, then there will be crash in RE as soon as psychology turns.”
Well, at least that is progress. You appear to be learning…..although slowly.
Cheap credit was the driving factor in RE: growth.
Have you ever priced Real Estate in Mexico City? Why is it so cheap with 30 million people in the city? How about Mumbai or Dhaka?
#145 neo
No. Average change is the sum amount of dollars reduced from the total sum of original prices. This is calculated as a whole then divided by the number of price changes.
Just to note: one price change is per property or listing, so a seller may have changed prices 2-3 times, but its counted as one since the first and last value is only needed to quantify the net change.
Example for all listings
-344 properties’ original prices totaled $284,864,336 million
-subtracted by the total sum of new list prices $266,467,881 million
-equals a net change of $18,396,394 million (reduced or loss)
-divide net change and total original prices by 334 for averages.
$284,864,336 / 344= Average Home Price $828,094
$18,396,394 / 344 = Average Change ($53,478)
I hope that explains.
#138 };-) aka DA on 07.17.12 at 2:11 pm
DELETED
HA! Two days in a row — DA, you getting the shakes yet?
SIFMA, the other interest rate benchmark
as it is defined on their website “The Securities Industry and Financial Markets Association (SIFMA) represents the industry which powers the global economy. Born of the merger between the Securities Industry Association and the Bond Market Association, SIFMA is the single powerful voice for strengthening markets and supporting investors — the world over.”
http://wallstreetonparade.com/libor-scandal-the-unvarnished-story-of-wall-streets-heist-of-the-century/
Genworth (MIC) new record low $17.43 http://postimage.org/image/o98oc2tud/
Foreclosures and POS are getting priced in. Hedge fund hyenas lurking…
#159 Tony
Just because you drive an old car doesn’t mean that you are poor. Far from it. I have an elderly neighbour who use to be a dentist . He drives a 20 year old car. We all know he is very frugal. He is a millionaire for sure and we all on the street know it.
#109 Canadian Watchdog
I see what you mean. It appears to roughly track, but there are deviations and who knows where future HPI figures will land vs reality. An average of averages can be misleading.
#111 Bigrider
Leverage, education/momentum, moral hazard and tax policies at federal, provincial and municipal levels that encourage and subsidize home ownership?
Oakville vs. Brampton
Both have similar areas of similarly sized homes at inflated prices. Both have GO transit and local bus service. Both have access to publicly funded schools and a local hospital. The living conditions of residents, on the surface, appear to be equal. Why is one area considered so much more desirable than the other? I leave that to blog dogs to ponder.
The relentless stratification of wealthy people who strive to live with like families in “better” areas continues. The wealthy quietly take over neighbourhoods and claim them as their own, just as the middle income and the poor do. Existing social structures, local government and institutions no longer supported the core values of the upper income earners.
Neighbourhoods were more cohesive and homogeneous in the 1960’s with respect to income levels and social status than they are now. Plant managers lived in the same neighbourhood as the workers on the shop floor. Of course, the executive had a nicer home. He had a powder room and maybe a carport.
The provincial governments decided to make things even better for Canadians. (Oh no. I was afraid of that.)
We can thank the social engineers and provincial intensification policies for giving us both the destabilization of many successful residential areas and the condo slums of the future.
We are more divided racially, socially and economically than ever before. Our cities are not safe and our communities are not viable, healthy places to live.
Here in Victoria: The Chek 6 news Facebook page just asked folks if they are having a hard time paying their property taxes and utility bills. People are HURTING. comments are rolling in…..Lots of people losing jobs in this town and none to find…..
Kinda odd that they would pose this question to the general public. Perhaps peoples daily struggle is becoming VERY common. More folks BROKE than NOT.
Let’s face it, a lot more wealthy people in Canada due to RE than financial markets.
I leave it to you and the blog to conjecture why.
The boomers moved through North American demographics like a pig in a python. They put it in real estate.
And in the U.S. got their ass’s handed to them.
Canada is NO DIFFERENT!
Prices dropped in the high end homes and a few houses move again. Amazing how a 10-15 % drop has moved things in oakville and the GTA. People are still negotiating down though… I consider this the drop in intervals but still expect the smart shoppers to hold
Out. Like a fun game of how low sellers will go :)
Going into the BoC announcement this morning, the overnight index swaps (OIS) market was pricing in possible rate cuts before the end of 2012. Rate cuts remain priced in to the medium term after the announcement apparently. I hope the market is wrong, we need rate hikes if anything.
There will be no cut. — Garth
What! Oakville is not different than Brampton? What drugs are you on?
#136 Sammy Duschene on 07.17.12 at 2:04 pm
Will RIM be ok?
—————————–
RIM will rebound with a vengence. It’s time to buy some of their shares. Buy, buy, buy!
People make the same mistake around the water-cooler when we compare notes on renting vs buying.
They learn that I am a renter and automatically assume I have zero assets. Apparently I am “paying for someone else’s mortgage” and doing absolutely nothing to accumulate wealth of my own.
They don’t get it when I say “which bank are you borrowing from for your mortgage? Oh, really? You know they just paid me a dividend yesterday….”
just talked to a relative,8 people bought dev.property so they could qualify for a 1mil.loan.in surrey b.c.they all make over 80,000.00 a year.good,bad,or the ugly? what do think garth eastwood?
–
#166 Cory — “He drives a 20 year old car. We all know he is very frugal.” — That’s the millionaire next door, a good example of living within or below one’s means in order to have an adequate life. Not pretentious tripe, just average.
*
From Hero to Zero US economy; Libor and Barclays “Fascism should more properly be called corporatism because it is the merger of state and corporate power.” — Benito Mussolini.”; The Matrix or where we are now; Libor’s okay, the US Fed is the problem and Tim Geithner; Strong Pound Does that mean the US$ is tanking? Drought What’s In Your Wallet? Rising Oil Prices; Life Support for Economies.
*
2:08 clip Flight 93, 9-11, banned footage, and 21:11 clip US troops ordered to kill citizens who don’t turn over their guns (Soros / Obomba / UN / Agenda 21); Stuxnet – Flame Here’s a new one, an equal-opportunity employer; Pentagon Comics Alexander the Great, Hitler and many others have all tried and failed for global domination. The west is no different; Exposing Obummer reveals the secrets of DC; Ron Paul Will be up for nomination; Morocco – Syria It should be noted that the US govt. is repeating the WMD lies, this time about Syria; Billary Like the true neocon zionist she is, her hands are in other places as well; The m$m Dying a slow, decrepit death; Circling Iran Guess it makes the big boys look tough to pick on small fry; Accidents Happen “You have to love how ynet characterizes Mordechai Vanunu as an “atom spy” when the only thing the guy did was to tell the world the truth about Israel’s nuclear weapons program at Dimona! Telling the truth, both in Israel and here in the US, about government operations the government doesn’t want its citizens or the world to know about, can really get you into deep Kim-chee!” wrh.com; GM Babies and Cartoon; The Gates Foundation Melinda’s on a depop. drive; Russia pays Iran Defying oil sanctions.
I think Silver is better.
I am at my bank trying to get life insurance. I am right on time..enter the office…which is dark and windowless.
Then the sound of un-oiled hinges and this guy gets out of a box.
Sells me all sorts of extra stuff…..I mean I may be here all alone like Burgess Meredith in that Twilight Zone Episode, and not get my money out.
If I’m going down, he’s going down….gold would be useless.
Good thing Herman didn’t listen to this website’s advice and sell in 2008 or 2009 or 2010 or 2011.
He had nothing to sell until 2011. And selling then would have been just fine. — Garth
You are now embarrassing yourself. — Garth
Actually you are now embarrassing yourself when you censor a post that points out the fact that you didn’t define a recession properly.
Recession is negative economic growth. Fail. — Garth
And I point it out as a FAIL because it is two consecutive quarters a negative GDP and you don’t post it. That is petty and embarassing. Of course you won’t post this either. But that’s ok. I know the truth, even though you wish to conceal it from everyone else (-:
I didn’t post it because it was juvenile. Of course a recession is two quarters of negative growth — which has not happened in the US. Now you are really embarrassing yourself. — Garth
#162Canadian Watchdog
Thanks. We will see shortly how this translates into the sales figures when the TREB July mid-month comes out.
media watchers
http://dealbook.nytimes.com/2012/05/21/reinstating-an-old-rule-is-not-a-cure-for-crisis/
Reinstating an Old Rule Is Not a Cure for Crisis
By ANDREW ROSS SORKIN
=========================
How the New York Times Hides the Truth About Wall Street’s Catastrophic Misdeeds
The paper of record is in serious need of a fact checker when it comes to whether the Glass-Steagall Act could have prevented the financial crisis.
http://www.alternet.org/story/156070/how_the_new_york_times_hides_the_truth_about_wall_street%27s_catastrophic_misdeeds/?page=2
I live in southwest Oakville and stuff is still selling like hotcakes, nothing has slowed down yet, even the for-sale-by owners sell in a week. We had a slowdown last summer when nobody else did so maybe it is different here. The demographics of the neighbourhood is changing. The original houses are owned by 80+ people who are dying off, these bungalows are sought after by people who don’t like the uber high prices in the south east and you can get a 1/4 acre fully treed lot for about 300K less here. People who buy these houses are not first time buyers and I really doubt that any CMHC rules would affect them as they are all doing new builds.
The QEW shields us from the riff-raff and congestion in the new part of town and always will. If the government tries to do anything here like put in a power plant they will start a committee with 10 pro bono lawyers and bring in Erin Brokovitch so it will always be pristine. You cannot buy an 75 or 80 foot frontage fully treed lot 30 minutes from Bay Street on the Go train with the most service of any line, walking distance to the lake, and isolated from poverty by having almost no social housing at all, in many other communities. It’s why so many professionals come here to raise their families.
I think that RIM is dead. Companies do not give out cellphones anymore as people have their own smart phones.
At first, Blackberries were a symbol of success, then they became virtual leashes around the neck of white collar corporate slaves.
Now, they are only used by 13 year old girls that can’t afford to get an IPhone.
I am slightly exaggerating but I think you get the idea.
Herman has most likely never lived thru a housing downturn by the sound his faux logic. He never accounted for opportunity costs in his short-sighted cost / benefit calculation. Need we not mention that a 20% drop in condo shoe box prices is an overly optimistic assumption. I think Garth is trying to knock that sense into him, but for someone who has never done anything to earn his equity keeps, what easy comes will go out just as easy. Herman will learn it the hard way.
#179, RIM, while as sexy as a Rhino’s mating call, are the most secure of the cellphone offerings. Until Samsung, or Apple, or Nokia can outrival the RIM for data security, RIM will have a place in the business world.
RIM will not regain personal-cell-phones status as their native browser is horrible, and they lack the neat-o apps that the rest of the pack offer.
#171 Roial1 on 07.17.12 at 5:17 pm
Let’s face it, a lot more wealthy people in Canada due to RE than financial markets.
You got that right.
Heading over a cliff:
http://www.marketwatch.com/story/qe3-is-pointless-as-we-head-over-the-cliff-2012-07-17
Predicting “massive wealth destruction”:
http://www.marketwatch.com/story/how-bernanke-will-cause-the-next-crash-before-2014-2012-07-17
Marc Faber is an alarmist. The Bernanke story bears no relation to the headline. Do you need a hug or something? — Garth
Thank goodness the builder didn’t finish Herman’s unit until 2011. It prevented him from selling too soon like others who had condos but listened to the wrong advice and sold in 2008 or 2009 or 2010 or 2011. Herman should be happy it took four years to build otherwise he could have lost out on his “once-in-a-lifetime two hundred grand tax-free capital gain.”
Good for him. He will be the last of his species. — Garth
174Flash on 07.17.12 at 5:32 pm
What! Oakville is not different than Brampton? What drugs are you o
More than 80% of new developments in Oakville [houses/townhomes/condos] are owned by Indians more specifically turbaned indians [sikhs/punjabis].Their parents live in Brampton.Kids are highly qualified,earn good income so they can easily afford Oakville houses. Lots of Indians sold their properties in Mississauga and moved to Oakville.
Even in Brampton, near hwy 50/castlemore most of the new homes are purchased by Indians/SEAsian professionals.
..that men of the scripture are not concerned with the material life. Not so fast, some of them were caught in the crossfire of the real estate frenzy, and here is the effect:
http://www.realtor.ca/propertyDetails.aspx?propertyId=11590683&PidKey=1766369414
“So I carry on, and will not stop.”
******************
Good! You DO take alot of crap…but I guess debate is a good thing.
Sorry to tell everyone who thinks it different should know that every part of the GTA is set to drop 30-50% over the next few years. The GTA has already started to drop 10-15%. Houses that were listed for 1.2 million now selling at $999K . Those that were selling at $990k went down to $835K and so on and so on all over the GTA. It’s obvious to anyone that prices are falling everywhere and I think people see the crash happening and have already started to hold off even before the mortgage changes. This explains the countless empty open houses and huge drop in sales in the GTA. It’s going to be fun to watch CREA spin July’s bad numbers.
Just got my nightly 6:30pm chuckle from the folks at Global BC.
In a nutshell, if we’re to follow the gospel of real estate association ‘economists’ (tonight’s looked fresh out of school), then F’s recent moves were entirely overkill, and Vancouver’s prices historically run up for a while, then flatten, then run up again, to paraphrase the ‘economist’.
If that’s the case, it’s probably all clear to go buy a house…we’re in a leveling phase
“Even in the 2008 crash (which will not be repeated in our lifetimes)”
Great website Garth but you really have to elaborate on this statement. I am sure you have seen the list of Debt to GDP ratios lately, the ridiculous financial gymnastics going on in Europe, and the corruption in the banking system (MF Global, JP Morgan, LIBOR, Peregrin). This can’t happen again?? Please feel free to use a whole blog to adequately justify your statement. Thanks
What happens tommorow, email me some financial advice, the gold dust as gotten to my nostrils sould i get a job or run?
I never in my life thought I would ever say this but that almost 17 million dollar house is fugly!!
RE: Mark W post #12 in Richmond, how is that possible?!!!