Yesterday I debated online with a mess of people who hate me. Well, perchance ‘hate’ is too strong a word. Revulsion might be better. Bordering on fear.
What the likes of rock star economist Sherry Cooper, realtor-to-the-stars Elise Kalles and condo king Brad Lamb don’t get is why anyone wouldn’t want to pump real estate. After all (their arguments), rates are cheap, our banks are perfect, Mercedes have come down in price, Canada has unbridled resources, and all the poor people from Whereverstan want to move here. What’s the problem?
So as we hurled emails like deadly, flame-encrusted javelins (to be published soon in a Toronto magazine), it was hardly a fair fight. Brad held me down while Sherry and Elise pummeled the kidneys. I may never pee again.
But none of this changes the fact the gig is up. Industry insiders yesterday got access to the latest numbers on the all-important condo market in Toronto, and they are uglier than the teeth marks Cooper left on my chiseled frame.
Naturally, this pathetic blog has the scoop.
- Sales of new condos in the last three months fell off a cliff. The drop was 50% compared with the second quarter of 2011. This is unprecedented.
- The number of new, constructed and unsold units has mushroomed to 18,123. It’s the highest level ever, topping the 17,610 unsold units that were left unwanted in the middle of the 2008 financial crisis.
- Of all the new projects launched 64% of units marketed did not sell. This is the lowest absorption rate since the depths of the GFC.
And it’s not just year-over-year sales numbers which are devastating (since 2011 was a banner year). New condo sales actually tanked 21% in the last three months compared to the first quarter of 2012 – long before F murdered the 30-year mortgage, or the bank cop spelled the end of the cash-back mortgage.
Developers are looking worse than my deeply bruised but oddly magnetic abdomen. Two big developments (TUX and Triumph at One Valhalla) were launched, but then quickly iced. Another, The Perry, came to market in April but had to re-priced after sales bombed.
This is the perfect storm. On one hand, first-time buyers with the hornies are facing the end of 100% financing and higher monthly carrying costs, while having a tougher time qualifying for a mortgage. F has taken his punch bowl away in the middle of the party. Meanwhile investors – who account for almost 80% of condo sales – are fleeing. Last year up to 20,000 units were snapped by flippers, speckers and general idiots, who have realized this is now financial suicide.
After all, at current prices nobody can buy a condo and be cash flow-positive on rent unless sinking a major amount of money. And that simply makes no sense, since appreciation is slowing fast and likely to turn negative in 2013. Media coverage is now universally poor (about time), which is turning consumer confidence. And both buyers and renters are disgusted with what the developers are now offering – microunits of 400 square feet or less. New condominiums are now smaller than most garages as builders strive to keep them affordable. But at $800 or $900 a foot, they fail.
The fear is out there: investors will disappear just as end users take a pass. That means a big chunk of the 43,000 new units hurtling down the delivery pipeline will cascade onto a marketplace which can’t digest what’s already built – including those 18,123 unsold condos. There’s no other choice for many developers but to put on the brakes, return deposits and leave Toronto pock-marked with yawning construction holes.
The only shock is that anyone would be surprised.
Excuse me now. I have to bleed.
223 comments ↓
Poor doggie!
Wow. Those numbers in Toronto are worse than the worst numbers ever released in Miami. I think we all know how that went…
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” I may never pee again.” — Try the ears. They work just as well!
“F has taken his punch bowl away in the middle of the party. This is the perfect storm. ” — To pee in? Wot a party pooper!
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Thought For The Day: “You know, I’ve been around the ruling class all my life, and I’ve been quite aware of their total contempt for the people of the country.” -Gore Vidal” (wrh.com).
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It’s Here! Garth, an alternative POV; Meltdown Morning; Crimes of the Century(ies) Big banks, and a lot worse than most think; UK homeless rises by 25%. Let’s have more wars! Spain’s Moment of Madness Bailed out, get the 2020 Olympic Games. How TPTB must be laughing their heads off, and Olympic Lies and Spain wants them? Another banking crisis? Interesting read; UK mfg. contracts; Asian millionaires take charge of own wealth (banxters can’t be trusted anymore).
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4:34 clip “Butchers control the government and they want you disarmed and silent.”; Iran warns Turkey, but Russia sees more; 2:52 clip See for yourself; Turkey arming terrorists on UN – NATO – US and Israel’s orders, and Obomba The WH follows dictates from Ssshhh . . . U-Know-Who, and Rebuttal; ‘Net Censorship and Gun Control How to dismiss civil liberties.
What affect , if any, will the decision to leave interest rates unchanged have on the gta housing market, in the short term?
Zip. — Garth
Garth, for retribution in consideration of the wounds you’ve sustained from Sherry Cooper, may I suggest giving her “the shocker.” I understand she’s kinda freaky deaky like that. Hope your wounds heal quickly. You’re going to need to be in better shape than ever when chapter 2 of the Canadian correction takes grip – people will flock to you in masses (as sad as that may seem).
The end of the bubble reminds me of Kübler-Ross’ DABDA model: Denial, Anger, Bargaining, Depression, Acceptance. We are solidly at the “Anger” stage.
In USA, no mortgage on condo unless 70-80% owner occupied. So spec’er lie or pay cash. Still crashed.
It’s different here. It’s worse
“Yesterday I debated online with a mess of people who hate me. Well, perchance ‘hate’ is too strong a word. Revulsion might be better. Bordering on fear.”
******************
Well, apparently, there IS a full moon…..
The bloodletting has only just begun!
Act II; “catch those falling knives” will entertain the patient in short order.
Let’s sit this out and wait for those distant opportunities…
By the way, S&P cut ratings on seven, yes SEVEN, Canadian banks 6 days ago from “stable” to “negative.”. So much for perfect… I doubt it ever made front page headlines in Canadian “news'” though.
http://www.ctvnews.ca/business/s-p-cuts-outlook-on-7-canadian-banks-1.896993
http://canadabubble.com/bubble-watch/2405-canadian-real-estate-bubble-sap-cuts-outlook-on-7-banks-on-high-home-prices-consumer-debt.html
It won’t be long before some Liberal idiot convinces the jerk governing this province to waste more money by purchasing these surplus condos and turn them into affordable housing.
Canadian banks are underperforming their global counterparts by the most in a year…
http://www.bloomberg.com/news/2012-07-30/consumer-debt-eroding-canadian-banks-edge-as-s-p-cuts-outlook.html
Stop over dramatizing Garth. You ride a Harley, it already vibrated your kidneys to fine powder. Although I undrsteand why you ride that vibrator on wheels – it takes some of the Amazon upkeep work off your hands.
Don’t fester there Garth, you Rock.
I called it, July will be the turn around month. Just like July 2006 in the US.
Who da man!
Brad Lamb: “The agent called me while I was watching my granddaughter in a play, …” (Post City, April 2012) “Don’t worry”, Brad told me, “it was on vibrate.”
In June 2012,Monarch launched freehold townhouses near Ellesmere and Midland for $450k.Now they are launching Phase II in same area for $419k.
Drop of 30k in one month.As per Maonrach’s report,Phase I was sold out.
Well Sherry lets see if the Americans build their casino -hotel across the way at the MTCC. Will wilt the Ritz. I would have gone for a Manulife pent on top the rails in Yorkville.
average box condo will soon be $25,000-50,000 in toronto.
yet no one will buy them, with skyrocketing fees.
“But none of this changes the fact the gig is up…”
*****************
And they know it. Must be frustrating as hell to admit to themselves that you were right all along…
The jig is up in my neck of the woods, that’s Port Credit, who wouldn’t want a nice little condo by the lake???
Price reductions galore, seems like everyday there’s a new one, I might even start my own blog one day lol
Was $359,000
http://www.royallepage.ca/jumplisting/search/ON/Mississauga/581067/0?feed=4&officeId=11724&language=en
Just Reduced $347,500
http://www.realtor.ca/propertyDetails.aspx?propertyId=12266380&PidKey=1461830457
Originally listed at over 440k back in 2011, and has been re-listed a total of 4 times, ask your realtor friend…
Admittedly, its been hard to keep up with all the games “de-list & re-list” Thank goodness I can google.
mmmm…guess that means higher property tax’s to keep the muni budgets afloat.
…as there wont be to many sales of new property to help float the bloated muni budgets…
rot in hell flippers… hope your caught good and proper.
Silver
I don’t believe Garth has a chiseled frame. I will believe it when he posts his pic on the top of this blog.
How can I even argue those numbers.
Straight from one of my friends Royal LePage monthly newsletter in Burlingchuck…. still pumping until the last day…… “Down payment? That’s for losers. Buy house. Today. Fwee. No money” – Tom Vu
“With interest rates still hovering at all-time lows – with nowhere to go but up – now is an ideal time for first-time homebuyers to embark upon homeownership.
But if low interest rates still don’t tip the scales on your decision to enter the property market, perhaps the information below will.
Down payment
The main reason many renters feel they can’t afford to purchase a home has to do with saving for a down payment. But there are many solutions available today that can help first-time buyers with their down payments.
Many lenders will allow for a gifted or borrowed down payment. And of those lenders that will not provide this alternative, many offer cash-back options that can be used as a down payment.
Better yet, there are programs available from some financial institutions where they will offer a “free down payment” or a “flex down”. Of course, you will end up paying about 1% more in your interest rate, but the program will help you get in the homeownership door and start accumulating equity earlier. The only catch, however, is that you must remain with the original lender for the full initial five-year term or else you’ll have to pay the down payment back.”
#20 Daisy Mae on 08.01.12 at 8:55 pm
“But none of this changes the fact the gig is up…”
*****************
And they know it. Must be frustrating as hell to admit to themselves that you were right all along…
…………………………………………………………………
It took him long enough LOL
Long time reader (well not that long I guess), first time poster…
Quick question for you. Dividends-paying equities and ETFs in the U.S.
My understanding is that they are taxable by the IRS event if in a TFSA. Is this correct? Is there a way to circumvent this ? I don’t want to have to file taxes in the States… Is there a way to avoid this?
Thanks guys.
Canadians don’t pay taxes to the IRS on US equities held here. — Garth
Vancouver’s detached average home prices have now travelled back in time to November/December of 2010.
listings: up +24%
units sold: down -28%
February 2012′s all time high of $1,235,244 dropped $193,919 to reach July 2012′s average price total $1,041,325
July 2012′s average apartment price of $406,366 now challenges prices last seen in July ($400,823) and September ($409,068) of 2009.
quoted from http://www.yattermatters.com
Why not put some Industrial Wind Turbines atop those condos and let the ratepayers of Ontario pay under the FIT program and the FAKE Green Energy Act….FREE MONEY….McGuinty and the Liberal Vote Monkeys would love this….
July stats came out for Vancouver. Houses and condos are now down 16% in price from peaks. Houses dropped for the 5th straight month in a row. Crash… crash… crash…
Maybe the realtors, developers and promoters all want to become private lenders and mortgage financiers ? No ? I didn’t think so.
Was in GTA this past weekend to visit friends. I can’t believe how many condos and how many yet to build condos around. The city skyline has completely changed from 4 years ago. This will be real ugly. Perhaps I can snag me a 400 sq ft condo at Florida prices in a few years.
The essence of value is scarcity. With that basic, fundamental fact in mind, one should typically not buy a condo as an investment. In most cases, supply can be increased too easily.
A concrete box in the sky with only a concatenated link to actual land is not a real property. A real property has its own land, and that’s where the real value lies. I believe it was Samuel Clemens who said, “Buy land, they’re not making it anymore.”
Mr. Twain got it. Apparently, 80% of condo buyers in Toronto don’t.
On the other hand, there is demand. The price of anything will rise if demand is outpacing supply. But just as monetary inflation can balloon the nominal, but not necessarily the real, value of stocks, one has to consider the quality of the demand. Well, when 80% of demand comes from speculators, it’s not very good quality. It’s the kind of “demand” that can melt faster than soft butter on Texas asphalt.
What about cash flow/income? This is the essence of investing. Can something be a good investment if it generates negative cash flow? No. Yes, there can be capital appreciation, but buying for cap appreciation in the short-term is speculating, not investing.
It’s also generally not wise to buy an asset that everyone already owns. With home ownership rates in Canada at all-time highs, and hordes of speculators rushing to buy condos, where are the greater fools? Maybe they are in Whereverstan.
The condo builders and buyers are also ruining the market for rental properties in Toronto. How many of those condo speculators will stubbornly hold onto their concrete boxes and rent them out, even with an operating loss, in the hopes of appreciation down the road? RE always goes up, right?
RE in Toronto is moribund as an investment. And it’s primarily the government’s fault. We all just got royally F’d.
#11 Ron
the condos will eventually be ‘affordable’ housing. no need to spend taxpayers dollars, just wait a while.
ALL i know is that the prices haven,t dropped on ,ls so i don,t get what all of you are talking about ?
I saw the TUX condo sign at SW corner of King W and Bluejays Way, Toronto. Didn’t know it was mothballes.
A condo is planned for the SE corner (sales center being built), NW corner (currently a Shoppers Drug store), down the street beside the LCBO, and even the LCBO itself is slated for Brad Lamb’s ‘Charlotte’ condos.
(LBCO = Ontario Liquor store)
Just S. of Tux we have Bisha condos. Across road from Bisha – opposite Second City – more condos planned. A little bit east, King @ John we have Mercer condos.
Irony? Globe and Mail’s offices building, a bit S and W on Spadina is slated for condos! It and the next-door Toyota dealership will be razed.
Need I go on. Condos everywhere.
I feel for ya Garth.
As long as you aren’t coughing or leaking fluids, you should get through this. Just don’t look in the bowl the next couple days or it could tramatize. Hang in there buddy and I just gotta wince when I see this, these incisers aren’t natural:
http://www.bmo.com/bmo/files/images/4/1/Cooper_Jan2011highres919.jpg
Tough as nails Garth must be to survive that, we’re lucky to still have him! Its pretty dicey out there, sounds like the end of the beginning is here. Keep your shivs within reach, folks. Dangerous times… dangerous times indeed.
Stevenson, BPOE, DA … what can we say.
You came, you lost, you lose.
Aside from these 3 idiots, I know about 95% in my world footprint believe real estate can never go down and about 50% of the people I know have bought in the last 3 years.
Can you say Freedom 95 … you’re dumber than I thought.
Wondering why RBC put out report claiming there’s no housing bubble?
RBC readies covered bond program for mortgages: http://www.housingwire.com/news/rbc-readies-covered-bond-program-mortgages
Sorry RBC, no CMHC backed mortgages for you this time.
“This is the perfect storm. ”
Correction Garth. This is the perfect shithawk storm we are about to witness. O lovely citizens of Canada, whose HELOCS have made you feel so good these past years, prepare for the biggest friggin shitstorm this country has seen since the dirty 30s.
By the way, keep us in the loop on when the article is out please.
The more people spend on housing the less they can spend in the rest of the economy. It’s not rocket science. Either the current generation of homebuyers take the hit on the value of their house or the next generation won’t even bother looking at housing market.
Where does these “Pro real estate” investors think money comes from for 99% of people? It takes years and years for people to save the down payment. Add all the market crashes and money market NAV volatility to the mix and your left with a decades worth of people who despite wanting a home, cannot buy one!
The game is over. The jig is up. Go gouge another segment of the economy pack of useless rent seekers.
Daystar (All posts from yesterday)
Thank the stars this is not a rag-mag, then you would be killing thousands of innocent trees on top of the posters you kill here with the HOT AIR YOU SPEW!!!
Windbag and an IDIOT!
Not a native species in these parts but Garth welcomes all comers :-)
I’m sitting in my home office……It is larger than 400 sq ft by a squeeze and a tad……larger if I was to consider it a ‘flex space design’ ( bwahahahahahahaha) and leave the walls and doors to the imagination.
I have seen todays new micro-condo offerings….. a big guy can’t stretch his legs out in front of the TV….it’s really a cat litter box encased in concrete and tears.
There is no way I would want to add a toilet and shower unit to my office…..it would have to go into a closet…..I don’t like the idea of having to pee with my forehead against the wall and pretend that I was on line with my aim every time…that could get ugly if I’d had a scotch or two.
If I had to put a kitchen into my office I would be flex spacing that space too….and I don’t like the idea of snoozing with my head in the flex-sink.
I have room in my office for guests and the rare client. The flex space condos have hallways that are so narrow that two men would engage in a sexual gring if they had to pass into the hallway on the way to pee off the balcony..( Which by the way is a major complaint of many many who live in Taletown condo’s)
I don’t want to live in a place where the guests are required to rain pee down on the neighbours if two bladders fill simultaneously.
The new condo’s have a flex space folding screen behind which you sleep…….I worked hard so I didn’t have to sleep on a cot in the hallway…so those units don’t appeal to me.
I can buy a near new 30 unit cash positive apt building in Bangkok for $600,000…..why would I buy a litter box in Toronto? I can buy three fine homes in Dallas for 6. Ten houses in Florida…..need I go on……..this situation in Canada is toxic to your finances…..stay the ‘F’ away if you’ve got half a brain.
Please move to Bangkok. — Garth
#8 Daisy Mae on 08.01.12 at 8:25 pm…
My thoughts exactly!
I just wish we found a way to short CAD housing, just because a dumb RBC econ on the mortgage side loves housing doesn’t mean anything. Many considerable hours have been spent by both RBC DS and RBC CM trying to find a way to short this sucker. Too bad it’s taxpayers that will take this one on the chin…
Your pathetic blog is starting to get mentioned on MSM comment boards, Garth where hapless blog dogs get assailed immediately by the “it’s different here” crowd, claiming that you’ve been spouting doom and gloom for years and your (their?) anger is just channeling your sour grapes from your ignominious exit from F and the P’s party.
Remember that a respeced Ivy League economist said there was nothing wrong with the US housing market in ’06-’07, and that the soaring values were the result of “financial innovation”, while 9 trillion in HELOC ATM withdrawals was taking place at peak bubble values. But yeah, it’s different here
Now ask me if I care. — Garth
“…like deadly, flame-encrusted javelins (to be published soon in a Toronto magazine), it was hardly a fair fight. Brad held me down while Sherry and Elise pummeled the kidneys. I may never pee again.”
Writing is definitely your thing Garth! Thanks for the goods and keeping us entertained too. Looking forward to the article.
you are fu,./ comedy; please send photo of bite marks,tanks for stand up.
The last two blog entries are really well-honed humor. It’s a lot of work.
Let’s think a little after the doomsday condo meltdown. So folks have two choices, bleed and an empty flat or sell and run with a loss. If you are correct, I think the large impact will be folks holding on vaporizing condo’s and renting them at negative spreads. Basically the rental stock will explode. This will cause rental prices to decrease and shooting the already cheap rental/buy ratio into an all time low.
That will FORCE unit prices to be marked down lower and lower till we find a clearing price. It will be important to watch rental/buy ratios and absolute rental prices for this first sign of collapse.
This is the only real cash flow way I can see units being marked lower and owners jump over each other to rent flats and lower and lower rates (they will get low, because financing is low)
Also two other signs
For sale condos are now rental buildings or hotels.
Long time reader (well not that long I guess), first time poster…
Quick question for you. Dividends-paying equities and ETFs in the U.S.
My understanding is that they are taxable by the IRS event if in a TFSA. Is this correct? Is there a way to circumvent this ? I don’t want to have to file taxes in the States… Is there a way to avoid this?
Thanks guys.
Canadians don’t pay taxes to the IRS on US equities held here. — Garth
Why do they reduce my divend pymt everytime and call it tax?
You can claim it. — Garth
I have said it on this blog before. No slow melt . No gradual decline on condo prices….50% price reductions in the next year. CRASH…..CRASH…….CRASH !
Maybe quiz Sherry on how much collateral the IMPP freed up on her bank’s balance sheet to more easily secure funding from the PRA auctions and why it and the rest of the CDN bank’s primary dealers bid up liquidity so aggressively during/post Lehman crisis even though evidence illustrates there was very little counter party risk for these institutions at the time.
Then perhaps ask Lamb and what’s her face where the excess liquidity ended up and if it was a Bank of Canada policy decision or a herd of the wisest investors that drove prices higher.
As for rates are cheap? 30 year fixed at 3.57% have done wonders for markets not too far from here.
I notice that a lot of houses in Vancouver are losing the 8’s in their prices and favouring 0’s and 9’s……could this be a sign?
There are good times to buy and bad times…this is true for most everything we purchase. Why should we expect houses to constantly increase in value (I suspect many of Garth’s followers don’t think this!)? At the moment, it is best not to buy…but buying opportunities will appear at some point in the future! If we take the love of home-owning out of the fiscal equation then it is just another investment and…..as Warren Buffet has said….be bold when others are fearful and fearful when others are bold. Those who figure that out will make money.
I own a home and have no wish to rent…mortgage will be paid off in a few months, or a year or so if I decide to buy a lovely (bigger) sailboat than the one I own! Any future cash I can put away once the mortgage is paid off will be socked away in appropriate funds and be there when buying opportunities arise.
As for the immediate future…I plan to take a 2 week holiday and do some sailing around BC’s southern Gulf islands (I live there) on my old Catalina 22 sailboat!!!
Stopped looking for a house in Toronto in 2010 because the pricing was over inflated.
Started looking again recently (same areas), prices up about 15% from 2 years ago.
Not an expert in RE, but for all the stats presented here, i simply don´t see anything in the market suggesting house prices are correcting in Toronto.
http://tuxcondos.ca/
Nova Scotia Viewpoint stats for today (Aug 1 2012):
73 – forsale (or relisted)
30 – sold
63 – new price (all lower, except a few from developers which are increasing their prices???)
And this property:
PID 00271692
Bought for 3.8M this Jan 2012 (from $4.25M ask)
Now on the marker for 2.8M
Anyone know why the developers are not dropping the prices and are only increasing them??
i assume they are trying their best to prop up the market as long as they can, but this can’t last as everything else is dropping.
#38 Keeping the Faith on 08.01.12 at 9:29 pm
Aside from these 3 idiots, I know about 95% in my world footprint believe real estate can never go down and about 50% of the people I know have bought in the last 3 years. Can you say Freedom 95 … you’re dumber than I thought. – Keeping the Faith
#43 Keeping the Faith on 08.01.12 at 9:44 pm
Windbag and idiot! – Keeping the Faith
Wow, I’m a 95% ‘er. (putting on my shocked look) Wasn’t long ago I ridiculed you for running everyone else down because you had it coming. I take it we can’t be friends. (lol, I’m overwelmed with the loss, can I ever recover)
Sorry truth hammer #44. Property ownership for foreigners is prohibited by law.
http://www.invest-huahin.com/land-laws.htm
I have been reading this blog for what seems like an eternity.
However, there is a huge chronological gap between the last time Bunker, Amazon and Squirrel Recipes were used in a single post.
Is this an Omen…..?
@ # 38 Keeping The Faith
Funny thing, eh?
They just never came back to face the music (and reality).
Imagine that!
HAHAHAHAHAHAHAHAHAHAHAHAHAHAHHAHAHAHAHAHAHAHAHAHHAAHHAHHAHAHAHAHHAHAHAHAHAHAHAHAHAHAHHHAHAHAHAHHAHHAHHAHAHHAHHAHHAHAHAHAHAHAHAHAHAHAHAHAHAHHA!!!!!!!!!!!!!!!!
#27 Antoine:
“Quick question for you. Dividends-paying equities and ETFs in the U.S.
My understanding is that they are taxable by the IRS event if in a TFSA. Is this correct? Is there a way to circumvent this ? I don’t want to have to file taxes in the States… Is there a way to avoid this?
Thanks guys.”
“Canadians don’t pay taxes to the IRS on US equities held here. — Garth”
There is a withholding tax of 15% on all US dividends paid by US companies to Canadians, unless those shares are held in a Canadian registered retirement savings plan (RRSP). Then, by reciprocal tax treaty, the 15% withholding tax is forgiven for US equities held inside true retirement savings plans—the TFSA is not viewed as such a plan, in this treaty, as withdrawals can be made at any time before retirement.
Calgary still building a whack of condos. Most already built condos still not sold and developers are turning into landlords.
I am well aware of how Calgary works since I have been in the O&G game for 20+ years and it can turn on a dime. I have said it here several times that things ain’t so hot in oil and gas. Many layoffs still going on and with this rain, not much is moving either. but for some reason real estate will not die here. It should, but it ain’t.
Debt driven and low interest rate driven prices…thats it. There’s no magic to it but apparently credit/debt is still flowing freely.
This is a bit off subject;
I’m amazed at how many people decide against buying a perfectly suitable house, right location, and within their budget, because the yard isn’t big enough for their DOGS.
One zillionaire loved a London,U.K. property, but passed it up as too dangerous for his dogs, seems the fabulous roof-top garden wall wasn’t high enough.
I’ve always had dogs, but buying a property based on Rover’s likes and dislikes…madness.
#51 thinker
“If you are correct, I think the large impact will be folks holding on vaporizing condo’s and renting them at negative spreads.”
Rent for negative spreads for 1-2 years only to relist it with even more listings on the market. Many will choose to default once they work out the numbers.
Garth, this is the beginning of the turn around. Now is the time to jump in. I think your fear mongering isn’t going to wash with people when they see this massive opportunity brewing right under their noses.
Sorry, I don’t believe any of that crap I just posted. Sometimes I like to play devils advocate. I feel dirty now. Hitting the showers. See you next week.
Here’s a nice affordable starter home on MLS.ca for only $19,900. Only thing is the home is located in…..
Cleveland.
The listing agents are ReMax in Guelph.
Go figure….
http://www.realtor.ca/propertyDetails.aspx?propertyId=12231261&PidKey=-2120851439
However, bubbles are temporary and create temporary fake wealth.
What does a country look like after its housing bubble has peaked or collapsed? What happens to its people?
Read:
http://www.newworldparty.org/2011/11/housing-after-bubble-bursts.html
Darcy #52 – Dividends received on US equities are subject to a 15% withholding tax that is withheld at source from your gross dividend. Garth is correct in that you can claim this amount as a credit on your Canadian return. There is no withholding on US equities held in registered plans such as RRSP’s. TFSA’s are not considered registered plans and since the income is not subject to tax, no credit is available for the taxes withheld.
@#27 Antoine on 08.01.12 at 9:06 pm
Long time reader (well not that long I guess), first time poster…
Quick question for you. Dividends-paying equities and ETFs in the U.S.
My understanding is that they are taxable by the IRS event if in a TFSA. Is this correct? Is there a way to circumvent this ? I don’t want to have to file taxes in the States… Is there a way to avoid this?
Thanks guys.
Canadians don’t pay taxes to the IRS on US equities held here. — Garth
——————–
There is a withholding on U.S. Dividends in a TFSA. I believe that’s what he was trying to ask about.
Garth;
In a year from now when the inevitable happens (and you’ve had time to recover from the wounds) I suggest you get in touch with these jackasses, have another debate, and publish the results here. Many of us here, myself included, will eagerly await when you say: I TOLD YOU SO!
Maybe all of the new condo buyers are too busy flipping pre-build condo assignments?
Most banks and investment companies must now withhold taxes on profits and dividends on accounts held by American citizens and dual citizens living in Canada. As an American in Canada, you can file a tax return to claim those taxes collected by the us if the total income tax paid to Canada is greater that what would be payable in the US, per the existing tax treaty. Americans invested in Canadian mutual funds (including ETFs) must file additional paperwork because the IRS views these as investment companies, so look into it.
There’s also a potential for significant tax liability for Americans who sell their expensive Canadian properties, because capital gains taxes are payable on Canadian primary residences.
Gregor MacDonald:
http://www.financialsense.com/contributors/gregor-macdonald/when-qe-finally-fails
We can think of housing as facing several key constraints
First, there is the tremendous overhang of personal debt in the US.
that would apply to Canada too
Second, there is the lack of wage growth and the problem of structural unemployment.
I’d say a lack of wage growth, I’m not sure on structural unemployment
Third, the constraint of oil prices will not ease. This means that urban real estate may do well on a relative basis, but the majority of US homes will continue to adjust downward to reflect the permanent repricing of oil (and hence gasoline).
I believe this does apply to the Canadian market – which means that the far suburbs will decline in value while attractive central areas will not go down as much. In Ottawa, prices in Carp will decline whereas prices in the central core will resist the downward trend.
Finally, the notion that real estate prices have bottomed with mortgage rates near all-time lows seems a very risky call.
definitely does not apply to Canada
check for matched tags, okay
The housing crash is picking up speed as thousands of Toronto condos sit empty as no buyer or renter are willing to pay. Many people who purchased a condo using their HELOC could lose everything in this housing crash. It’s going to be a nasty crash realtors a nasty crash. Spread the truth Garth and you to Bloggers. Realtors , mortgage brokers and rbc are in a total panic.
Today, in Nanaimo on Vancouver island we are seeing a nice SF on a small lake starting at $549,900 and being reduced by $1000 per day until it is sold. (Dutch Auction) I know the realtor and he is really stand-up guy. No tricks here – the house will sell and at true market value. The only unknown is for how much.
So it appears the gig is up. Well, who was surprised?
Our Northern friends saw the mess the US has been in since what 2007?
Numbers might be finally bottoming out in most places now…maybe….maybe not. You get to look forward to more heavily indebted consumers, tougher bankruptcy laws, and a moribund economy.
Welcome to the fact it is NOT different THERE.
For that I am truly sorry. Still, there may e a way to retire someday without needing to read that great US Cookbook, “How to prepare ALPO 72 says and love it.”
The old ideas still have some merit.
WHEREVERSTAN, that has to be submitted to all lexicons of the English language; actually it might work in many languages!
Whereveristan????
Thats funny…!
The call came early. I knew it wasn’t my Son, Gad, what could this be.
My friend. My desperately strung out, also stone, broke, friend. He didn’t sound normal.
“Could I borrow five g’s”? * [And good morning to you, I muttered..]”He continued, like a mouse on speed, that “If I could pay the condo fee, back editions I owe”, I should be able to get a job, no problem”.
“How long has it been since you worked?”. I asked – “Four weeks”.
“Did you sell anything…” Well..it went downhill from there. Housey and status horny a middle aged idiot got way in over his head and one friend of mine still has student debt that would scare Mr. McGill. They have no resources, They have toys.
They have things. They have “heavily Bills”. (*Eagles 1977).
No savings. They had no plan.
This really woke me up. I hope it shakes you , if you are dragging your feet.
TRUST ME< you don't want to be where these friends are.
Median home price in Detroit is 21k yes less than the cost of a typical car! Not saying we will see this type of price somewhere in Canada but if you live in a town with little industry this is what can happen. Imagine if the oil sands were shutdown one day…
Hey Garth, do you have an online link that that debate? Would love to see it.
–
#246 TurnerNation on 08.01.12 at 7:39 pm — “Looking for a month-long sell off.”
— and —
#40 Jim Lahey, Sunnyvale Trailer Park Supervisor on 08.01.12 at 9:34 pm — “This is the perfect shithawk storm we are about to witness.”
Well summed up! Anyone notice how things around the world are slowing down quite rapidly?
*
TEPCO Nice bailout from taxpayers, and RBS being nationalized? Collective Financial Destruction; Ruin us and the rich enjoy it; US infrastructure It appears no one wants to fix it, least of all govts.; No recession here We’re too busy; China’s mfg. slowdown; Tumbling Dice Actually, RE; Don’t ferget next week’s / month’s / year’s Krispy Krisis, but every problem has a built-in solution; Stagnant Wages for a decade in UK; Chaotic Day; Nine cos. — no recovery; Lost Wages and CNBC, but Adding jobs or Losing Jobs; Top Ten Consumer complaints; 4:40 clip What is money cash? 18:22 audio clip Krugman’s flashing neon sign; Make Money by blogging.
Help! Not The Beatles; US Mfg. slows; Got Me Under Pressure; Negative Rates; Denting Auto Sales is high unemployment; S&P Default rate increases with high-yield debt; Disappeared are the good jobs; Abandoned Villas crumbling in Europe; Bolivia, Coca-Cola and the Mayan Calendar; Squatters are back; Nice Digs; Problems in Spain? You’re not kidding! Free Debt Money is destroying the west.
*
Niagara Falls in Neon Great shots; India Superpower? Not quite; The only thing to fear is govt. itself; Chicago Just in time for law makers to call for a ban on guns; ‘Net and TV One and the same? 39:39 clip Nicole Foss of TAE, one of Garth’s faves; Monsanto vs. DuPont Monsanto won; Homeless in Philadelphia; Fire Rainbow Image; 2:07 clip Diving to the ocean bed (Cormorant).
“…and all the poor people from Whereverstan want to move here”
So true, people move to Canada if they are poor or desperate. Nobody’s moving to Canada for business except spectators!
#27 Antoine. Strictly speaking Canadians receiving dividends from a US source equity are subject to a 15% witholding tax at source. If you hold said equities directly you must file a W9BEN with the transfer agent to claim the tax treaty rate otherwise the rate is 30%. Any taxes paid (witheld to the IRS) may be claimed on a Canadian return as a Federal and Provincial foreign tax credit. Your accountant should know what to do.
Re: #51 thinker on 08.01.12 at 10:05 pm
When the values of the condos falls far enough at some point in time the banks will call the mortgages on them. Owners will be forced into declaring personal bankruptcy. Just like in America these will all be empty units sitting there for years.
Rob wrote:
“I own a home and have no wish to rent…mortgage will be paid off in a few months, or a year or so if I decide to buy a lovely (bigger) sailboat than the one I own! Any future cash I can put away once the mortgage is paid off will be socked away in appropriate funds and be there when buying opportunities arise.”
——
Your comment sounds as if you bought in just as the ponzi scheme picked up speed, along with the weird and unrepeatable boomer demographic buldge, and now consider this “gain” to be yours. I guess it could be if you somehow turned this accidental, no-brainer winfall into something safe…if that exists ( a matter of debate).
If you “win” without offering value ( or get a “win” with 15% of the effort a guy who starts playing today has to put in) it usually means you’re in some kind of casino. Have you ever won in a casino and continued playing? What happens?
Sounds like you don’t think you’re in a casino, and the Canadian real estate bubble is “Canadian”. It’s not.
Do you know how your own house is valued?
The herd still stupido, bubble still flying, the herd will not awake until decimated (after 9 of 10 buyers will buy, and no one left to hold the bag). Ponzi scheme, a le Kanata. So where are we? maybe 5/10 bought 2/10 did awake and 3/10 still desperate to buy. Time left: 4 months. Bail if not on SOLIDO Groundo. Copyright.
Well, fired up the Harley today for the first time after just moving from Canmore, Oilberta and took a ride from beautiful Sidney (land of the newly wed and nearly dead) down towards Victoria via picturesque West Sooke Road… the FOR SALE/PRICE REDUCED signs flickered by like a picket fence, and that was at a moderate 60 km/h (as befits one of the wrinkled Boomers around here).
http://s10.postimage.org/n4zpabsbd/2012_07_Avg.png
Nothing to see here, move along.
Well, normally I would agree with Garth and say that the Condo Gig in Toronto is FINISHED, but time and time again there are readers here who say that they are in their late 20’s and are earning $240,000-Plus per year. I don’t know how its possible for a guy who’s 27 to be earning $300K per year, but Garth gets letters from people like that in T.O. all the time.
So lets see here: if the guy earns $300,000 and his wife earns $150,000 per year, that is a total combined income of $450,000 per year, almost half a million dollars a year.
Really, with income like that, does it matter if their $300,000 condo falls by $100,000 or so, they will earn that much in just a few weeks.
Won’t end well is mild…
Here comes the Tsunami……
http://www.martinarmstrong.org/files/Rapidly%20Approaching%20Demise%20of%20Japan/index.htm
No man of distinguished skill, elegant accomplishments, or knowledge of civil business, will ever be suffered near heart of government power; and the court of these political entities has revived the idea of coveting thy neighbor’s goods – one of the very 10 Commandments that it is widely believed God himself forbid for obvious reasons
7th and Cambie new development with 65% sold already and currently just an empty lot. Not bad for a “down” market. Folks, things are going better than I could ever have expected. Solid Solid Solid investment
Yes Garth…..I will obey and move to BKK as I do every winter in very short order. As soon as the first phalanx of geese fly overhead I will be off to winter in the sunshine and fantastic lifestyle of Asia.
Boo Hoo…..another winter in the sun…..but btw….you won’t get away with anyway…….you might be surprised to know that we have the internet a higher speeds than anything available in Canada….at a fifth the cost for five times the bandwidth.
The average ratio for comparisons sake is 6-1……being that it is 6 times more expensive for everything in Canada than it is in Thailand for exactly the same good or service…….and there are far more services available in Thailand than there are in Canada……including no waits for medical care…a service which is very inexpensive and served up by western trained professionals.
For instance I can see a specialist on the same day with no more than an appearance at one of many clinics……and if you think it’s all an ugly capitalist system that denies the poor…forget it…they have national health care….it just works better there without the strangle hold of unions.
If you have to winter in Canada you have done something very wrong in your life….IQ wise……..listened to too much Liberal nonsense….drank too much socialist bathwater.
OK….school me now…and tell to go…….so sad….not long now……tears falling…..you’re right of course…..just too bad you’re not right more often.
#46 Anon John
Do you recon Sherry wrote her own Wikipedia Page?
http://en.wikipedia.org/wiki/Sherry_Cooper
Oh Wait! Maybe she cut and pasted it from here; http://www.sherrycooper.com/ Maybe she doesn’t have time to be original bsuy girl I s’pose
Anyone know of a good fee based financial advisor in Van? My house horny wife took to reading this wretched blog at my insistence and now reads it religiously every day. Long story short she is getting freaked out about our lack of financial planning….
H and F will be tripling the number of immigrants allowed into our country to increase demand. Problem solved.
Fools, the oversupply of condos will be leased by the provincial government to keep poor people in upgraded affordable housing. If the the bulk of condo owners are speculators, who cares if some lonely young admin assistant rents out your downtown condo on the 14th floor or a family of 17 from “Whateverstan”.
I think it’s a great time to buy a condo!
It’s about time those ugly things stopped coming up anyway. I am so sick of going to visit my parents in Toronto and driving down the Gardiner Expressway in between all of those damned toasters. It’s like driving down a bowling alley and it’s disgusting.
Some idiot over here in the Eastern Townships actually tried to put up a set of condos in the heritage area of Sherbrooke (called “the old north”) and so many people showed up to city hall to strike down his re-zoning application that they couldn’t fit everyone into the building. Needless to say, his application was turned down. His argument was that “densification” is the way of the future. HA ! Packing people into tiny little boxes is totally ridiculous and it’s about time we nixed this kind of lifestyle. Condos have nevertheless still come up in our neck of the woods and we also have these idiotic modern style glass and concrete holes selling for $400,000.00 or more. Any moron that would buy into this deserves what he or she gets. Stupidity shouldn’t be rewarded after all.
Of course the opposite of densification is urban sprawl and we don’t really want to see that either (ie. row upon row of identical McMansions). This has unfortunately taken over areas of the Eastern Townships as well and you won’t believe the mausoleums that are coming up each and every day. These neighbourhoods are actually considered affluent and I just have to laugh when I drive through them and see the new trees that they plant on the front lawn (after cutting down the mature ones so that they can build) and the Audis and BMW’s in the driveway. It makes me want to throw up. Most of the couples that are building here separate and divorce during the construction and it isn’t unusual to see a brand new-build or a home still under construction go up for sale (at a ridiculous price since the owners want to get back what they paid of course).
I for one am glad of the recent changes because perhaps if money is more difficult to come by, people will think twice before making such a life changing decision.
And 400 square feet ! Are you kidding me ? That’s the size of my living room. How on earth can you fit a whole apartment in that ? I would love to go visit one of these holes, just out of curiosity. How much more “densified” can you get for heaven’s sake ? Why don’t we just build self contained bunkbeds equipped with a little microwave surrounded by tiny windows (for light) ?
Doesn’t anyone buy existing older properties anymore? You can call it a form of recycling. That’s were all of the prime locations are anyway. Those old timers really knew what they were doing and they built those homes to be strong and endure the test of time by using mother nature’s own gifts. Like building a house on a beautiful spot with a spectacular view and surrounded by already mature trees. Proper natural drainage (using gravity and not a sump pump) and windows that bring in natural light (as opposed to lamps that mimic natural light) .. not to mention using solid natural materials that don’t disintegrate when it rains and that last forever if properly maintained.
Instead most people would rather have cardboard boxes (err I mean two by fours with aspenite covering and a bit of Typar or Tyvek housewrap) with views of the neighbouring brick building. Why ? Because they want that stylish backsplash in the kitchen, the master ensuite and the “open concept” living space. Because the older homes don’t have enough closet space (that’s because people in those days used wardrobes for their clothes and they didn’t have so much damned “stuff”). Most are turned on by stylish 6 x 8 wooden outdoor patios and fake fireplaces. The developers of these places are charging top dollar for things that are worth practically nothing and which will have to be updated within the decade if not sooner. Many people are actually turned on more by the appliances and colour of the walls than by the fact that they are purchasing a box within a bigger box in the midst of a sea of boxes .. for heaven’s sake. The old sayings, “You can’t shine shit” and “You can’t pull the wool over my eyes” or “Like putting lipstick on a pig” are totally alien to our time.
In case you haven’t guessed, I am a lover of older homes and although I have to admit that these can be rather expensive to restore and maintain, I think that in the long haul, they are just as expensive as the newer and cheaper construction new-builds. Just as people are running from those 1970’s bungalows with linoleum floors, pastel coloured bathroom fixtures and carpeting in the bathroom, all of these condos and McMansions will suffer miserably once they begin to go out of style. I mean, what’s going to happen when, over time, those four or five bathrooms start to need maintenance and repair ? Or when the heating elements under those heated floors begin to break down and need maintenance ? Not to mention when the kids move out and people are left with McMansions that have 6 or 7 bedrooms (mind you, many kids don’t move out these days until they are 65 years old).
I am glad that condos are finally coming down in price because quite frankly I never understood what all the fuss was about. I just wonder what the next real estate trend is going to be … any guesses ? If you speckers want to make money on real estate, THAT’S where you have to put your money.
HHHW
Hi Garth
I’m not sure about new units, but there is no change in the total # of MLS listings. Today the number is 260000, and the same time last year it was 250000. Given the increase in population and extra properties in the BC market, the rest of Canada actually sees fewer properties on sale. Don`t get me wrong, I`ve been screaming bubble since 2005 and feeling pretty foolish about it, but I wanted to be perfectly clear that there is an actual shortage of listings in premium areas.
Like most sensible people over 40 I`ve seen this kind of thing before and I`ll wait as long as I have to. The correction may be close but I`ve learned that it doesn`t come at the time you are expecting.
Just one easy question….is Sherry Cooper a total idiot or an absolute liar? She has to be one or the other…. my bet is a bit of both, sold her overvalued soul to BMO and slighly “dazed and confused” as as well.
@ #93 ANONYMOUS on 08.02.12 at 1:43 am
Well, normally I would agree with Garth and say that the Condo Gig in Toronto is FINISHED, but time and time again there are readers here who say that they are in their late 20′s and are earning $240,000-Plus per year. I don’t know how its possible for a guy who’s 27 to be earning $300K per year, but Garth gets letters from people like that in T.O. all the time.
So lets see here: if the guy earns $300,000 and his wife earns $150,000 per year, that is a total combined income of $450,000 per year, almost half a million dollars a year.
Really, with income like that, does it matter if their $300,000 condo falls by $100,000 or so, they will earn that much in just a few weeks.
—————–
70% of Canadian Households own Real Estate.
Less than 1% (probably less than 0.5%) of Households have income like you are describing.
And, the high income earner is probably buying a $600k or $1M condo.
@ #84 where’s the online debate? on 08.02.12 at 12:29 am
Hey Garth, do you have an online link that that debate? Would love to see it.
—————
I’m pretty sure that it will be the next “Real Estate Roundtable” in Post City Magazine:
http://www.postcity.com/Post-City-Magazines/April-2012/Real-Estate-Roundtable-2012/
#101 Buy? Curious? on 08.02.12 at 5:57 am
Whateverstan? Whereverstan? Damn! It is nearly impossible to keep current with world political evolution…
what about SFSs??? IMHO, not a crash until SFSs go back to the “norm”. I’m hoping for a “real” crash, at the same time dreading it ’cause it will be the ruin of this country’s economy. sigh…dont be so happy, people.
Garth, are you the true writer of 50 shades of grey?? No?? Maybe you shoulda been.
Been reading this block for a year now. Learned so much and saved my dh a big load of money by not buying a cottage last year.
Thank you thank you Garth!
Blame the teachers.
It may very well be the beginning of the real estate corection. But the action will begin later, when the CMHC (SCHL) will go bankrupt!! And as usual (ITS THE LAW!) the banks will transfer this debt to the citizen!!
Where is RENTERS REDEMPTION?
# 33 – Samuel Clemens who said, “Buy land, they’re not making it anymore.”
Good idea, except land over-produced already in Canada.
And cheap too, near Moosonee…
Go buy some ! There are dirt cheap Crown land too – if you can fly to it …
The point is: FOLKS dont be so ANTI – CONDO !
This is greatest event ever in Toronto and leap forward in reducing TRAFFIC GRIDLOCK!
People will now live in Toronto and Work downtown!
No more traveling from-and-to suburbs every day!
Someone had to pay for this so its poor Speculators
Profit-Horny foreigners from Whereveristan …
Sheep-Realtors-and those with IQ of Garths kitchen sink
In year or so RENT in TORONTO will be ELEVATED to next level in quality!
Rental Buildings as we know them now will be recycled as renting nice CONDO will be at same price or less..
RENTAL PROPERTY ( big Buildings) in TORONTO will suffer the greatest, specially those that are not upgraded recently…
I remember times in Edmonton, Calgary where landlord lure renters by giving them 3 ( THREE) months free rent!
ahh good old days…
This video (about the carbob tax scam)says Ausrtralia’s first time home buyer grant is inflationary and acts as a wealth transfer to developers. IMO all first time buyer incentives in Canada have the same effect, although I think the banks benefit most by issuing bigger loans
http://vidcall.com/index.php/videos/show/2090/#chooseVidcallMailWin-coming-soon
There will be no recovery for real estate before it has dropped at least 90% from the peak and only if wage rates don’t drop from where they are today. FWIW current wage rates are pathetic and would have to be raised by 500% or better to keep pace with existing real estate prices. If wage rates drop then the drop in real estate prices would have to exceed 90% to bring prices into some reasonable ratio with wages.
So it appears I was correct two weeks back when I forwarded to Garth that silly enticement-to-speculate note ‘nailed to my front door’, said note seeking to drum up interest in a proposed twin-tower condo development at Yonge & Eglinton in Toronto. Mr. Turner quoted me as writing that this might mark the peak of the condo madness in TO and that this condo would likely not be built; looking at the numbers in his article it’s hard to come up with any other conclusion.
#24 Smoking Man on 08.01.12 at 9:04 pm
How can I even argue those numbers.
.
Does this mean you surrender your bullish outlook on GTA? But due to your view on SFH you’re going long on landscaping companies?
if someone is combined income at $340,000 and they buy a condo, they’re dumb. period and won’t be making $340,000 grand for long.
#11 Ron MacDonald on 08.01.12 at 8:32 pm
“It won’t be long before some Liberal idiot convinces the jerk governing this province to waste more money by purchasing these surplus condos and turn them into affordable housing”.
Wouldn’t make a lick of difference……and what would that do to condo “values” and the deteriorating impression of condo life? Condos are so overated.
“… is giving away the plans and says that, using common materials, the house can be built for about $300. It has a roof, a lockable door, a foldout desk and a window.”
http://www.cnn.com/2012/07/24/tech/innovation/worlds-smallest-house/index.html?hpt=hp_c3
Solitary confiment comes with more amenities…
#37 daystar on 08.01.12 at 9:29 pm
“Hang in there buddy and I just gotta wince when I see this, these incisers aren’t natural: ”
Likely 45% Aluminum Oxide- yikes!….how much of that leaches out?
Did I hear mortgage rates are going down? And may go down even further?
10 American – yes it did make the news in Canada. But the banks havent been downgraded. The “outlook” is what has changed. It has to do with the economy in general, and not particularly the banks.
“F has taken his punch bowl away in the middle of the party.”
No, he has taken the bowl away at the END of the party now that its almost dry, the middle would have been around 2006 when we had a chance to steer around a financial disaster we now face ahead.
I assure you the ship hit Ice about circa 2005, it is far too late and it will sink. Like the Titanic, only the first class passengers are now boarding the life rafts while the virgins and flippers have been locked in steerage below.
This mess could easily have been avoided years ago. Its a shameful and disgraceful situation we now face.
jj
10 American – but it looks like your amazons were
stronger than our amazons today
http://www.cbc.ca/olympics/rowing/story/2012/08/02/sp-olympics-london-rowing-day-6.html
I love this pathetic blog. I have been renting for the past 2 years with a firm belief that the Toronto Real Estate Market is severely overpriced.
I am little perplexed though with the rental prices for condos still being sky high. It would be great if you can give some insight as to with the oversupply of condo units, why there has been no substantial decrease in the rental rates?
Wow…so many worried realtors on this blog. It’s obvious the housing downturn is well underway. To update everyone on my three friends who have been trying to sell their condo’s in T.O. Well all three friends have not sold and this after price drops except for one friends who thinks prices will go back up. The two that have been dropping their askings are in financial trouble. The number of units for sale in all three building are still very higher with one building having 73 units for sale. Visiting my friends and seeing all the already built half empty condo’s and the sea of new condo’s being built its easy to see prices will drop hard and fast. I feel sorry for them but when the government is backing bad loans the banks will give them.
I have nothing against condos, but as they are now, they are over-priced and way way too small.
My parents live in an older 3-bdrm plus condo still and I envy them (we live in a mcmansion – paid for).
Until the condo prices come down and builders start building good quality and family sized condos, condos will not be a real alternative to SFHs in Toronto. Pity because in the bigger Asian/European cities and in NYC, they are.
“Developers are looking worse than my deeply bruised but oddly magnetic abdomen.”
LOL! My hat is off. I have a great respect for expressions of self-esteem that are both lightly-held and deeply delusional.
I shall coin a term for 400-sq-ft condos:
“microminiums”
You’re welcome.
#11 Ron… Yes, because affordable housing is such a bad idea, right? Perhaps you need to remember that your wealth is dependent on those you look down upon as “riffraff”. Your economic system does not reward innovation, it favours exploitation. The only thing “idiot”-ic is that you don’t know this.
In my view government should have nothing to do with real estate except may be to tax it and then may be.
There should be no subsidy of any kind , no mortgage insurance and no acquisition of distressed properties with a veiw to putting a floor under prices. If home owners and banks screw up, if the economy declines then excess properties in the market ought to be disposed of for what ever price people in the country can pay according to their means. If that means homes get bought for 5 or 10 cents on the dollar then that is just the way it goes. In a world where the government can tax your property there is no real property rights and ownership is an illusion even if the real estate is fully paid for. There fore there is no reason to pay much for some thing you can not really own.
“….uglier than the teeth marks Cooper left on my chiseled frame…..” -Garth
I hope Cooper and vicious team did not chew away your manhood.
re #27 – You may find this helpful: http://www.theglobeandmail.com/globe-investor/investor-education/how-to-avoid-withholding-tax-on-us-dividend-stocks/article1367786/
You can avoid the tax by not holding US equities in your TFSA.
You may find http://www.canadianmoneyforum.com helpful for answers to basic investing questions.
#124 Pete…….
Most landlords are liars……just like realtors.
They can ask pie in the sky rental rates as long as they want, but after 3 months of no rental income, when presented with a take it or leave it offer, they often times will take it. The only hold outs to this are the big natinal rental companies, but then, they will still negotiate at times and give you a discount, you just have to haggle with them and show them that you know the market. If they stick to their guns, you just move on, there is plenty of rental stock around….and all it takes it time to find what you want, at a price you are willing to pay.
If you have time you will be fine…..most people are stupid and don’t plan ahead when moving, so they are at the landlords mercy, because they didn’t make time to go shopping for new digs, and they have to take what they can find.
Looks like the Orange guy will be selling his Canadian shorts. Wishing the Orange field hockey team would do the same.
HHHW: Enjoyed your descriptions. We had bought a somewhat older house, fixed it up, sold it last fall, are renting a new crackerbox. Yes, it’s a little more space, but no, we would never buy this. It creaks, is cold in the winter, hot in the summer, and set in a barren subdivision that offers an unpleasant, car-dodging walk to the local plaza. You know much of the rest of the world thinks Canada is better than this. This kind of living does not bring out the best in people.
F’s Punch Bowl expropriation.
Actually quite clever….
Pop a huge balloon with a little prick(no pun unintended)..it will inevitably leak…. but slowly.
Because it takes a while, and not an instant correlation, the majority of people are clueless and will remain clueless that the Gov’t had its sticky fingers all over the bubbles creation.
While the evidence is there, most are too stupid or lazy to try and figure it out.
to: #11 Ron McDonald.
I suppose you are THE conservative IDIOT representing all the other idiot conservatives in this country??
TD: First time home buyers reflect on their rookie mistakes https://research.tdwaterhouse.ca/research/public/Stocks/NewsArticle/ca/TD?documentKey=100-109c0926-1
“The top reasons home buyers give for deciding when to buy their first home is that they get sick of paying rent (48%), get a full time job (31%) or want to start a family and need more space (31%). Many first time buyers say if they could do it again, they would have bought sooner (55%), however 60% also say they wish they would have made a bigger down payment (likely requiring more time to save). “
Garth, TO condos are in trouble, but some people say SFH are secure due to lack of land. How can I convince them otherwise?
Why bother? They’ll find out. — Garth
Take a look at the chart of this company, it has dropped 50% in just ONE DAY, and 65% in the past 3 days ( KCG ):
http://stockcharts.com/h-sc/ui?s=KCG&p=D&yr=0&mn=6&dy=0&id=p08538043969
WOW; First it was Stockton California that declared bankruptcy ( http://www.governing.com/columns/public-finance/col-stockton-californias-debt-problems-may-set-precedent.html ),
then today its San Bernardino that has filed for bankruptcy ( http://www.bbc.co.uk/news/world-us-canada-19089970 )
, and now I’m hearing rumors that San Fran is close to bankruptcy too !
Pete #129
You have flippers trying to sell or rent their condo for cash flow positive. Since they can not do either sooner or later they will be forced to except the loss. There are many people hurting financially in Toronto . The only reason why they have been able to survive is credit (HELOC, LOC, Credit cards) . People in Toronto are maxed out. A co-worker is looking for a LOC to cover the $250 increase in monthly mortgage payments. Not sure how their mortgage payments increase since I thought rates have dropped but they went on and on about that extra $250 they can’t afford. Times are getting tough and will be tougher as unemployment increases with a drop in construction and other RE related jobs.
I say Garth is running in the Olympics, and deserves winning a Gold Metal or two.
To: #91 Alberta Ed… dont you mean West SAANICH road? To get from Sidney to Victoria via anything with Sooke in the name means you were seriously lost, or, just don’t care if your’e buying a ton of gas criss-crossing all over the place.
German headline reads “Property prices soar but ‘no danger of bubble'”.
I guess it’s different there too.
http://www.thelocal.de/money/20120802-44133.html
@Jeannie, post #66:
That just goes to show you that, despite all this talk of recession and doom and gloom, there are many people who are so wealthy they don’t know what to do with all their money.
#116 TR….just a few days ago a posted provided a list which showed how many hundreds of thousands of civil servants are making more than $340,000……the majority of whom were appointed by the Liberal Party….they have been swilling in the trough for decades and can’t be fired…….don’t think that there isn’t an abundance of stupid money in Canada…….there is no IQ test to work for the government unions.
We’ve got knuckle dragging second hand transit cops in Vancouver raking in $200,000….plus the pensions from their ‘old job’ at the VPD and RCMP.
Now wasn’t it smart for the civil service unions to demand that gun toting cops patrol the platforms for fare evaders rather than just put in turnstyles at zero cost from the beginning?
#86 new canadian on 08.02.12 at 12:38 am
“…and all the poor people from Whereverstan want to move here”
So true, people move to Canada if they are poor or desperate. Nobody’s moving to Canada for business except spectators!
———————–
I think the sarcasm would have be greater if he wrote, “…and all the rich people from Whereverstan want to move here.”
After all, they are bringing HWM (Hot Whereverstan Money!)
#115 SeeBe
Was never bullish on condos sold two last year.
supply and demand altho the numbers garth post look bad. I’m still not convinced will be other that a small adjustment in condos.
SFH super bullish in 416. Especialy long branch and miss south of lakeshore cawthra to port credit. Massive project coming to that water front. I look to buy another SFH hoping io can get a bit of a deal come Dec. Best month to buy.
As far as long on landscaping co. So long as they smuggle there weed killer from USA
….in the long run we are all inanimate objects
minus $440 Million?
Knight Capital Group
lol – “We’re losing the human control in our business
Heres a perfect example of civil service gluttony and abuse.
http://www.vancouversun.com/news/Vancouver+spend+send+seven+including+mayor+Olympics+lure/7026198/story.html
A free trip to to ‘attract investment’ ….as if the British traders were not already the most sophisticated on the planet and didn’t know where Vancouver was.
Penny Bellam btw makes over $350,000 per year as a political appointee of the mayors office…..it’s not entirely clear what she does as she has no formal training in anything except backroom civic politics.
Now this is a gem….The City of Richmond recently sent 5 city councillours to Tokyo ( all expenses paid btw) to deliver a charity cheque for ‘Fukushima’ in the amount of $50,000. I guess they’ve never heard of wire transfer or paypal. It has easily cost the taxpayer in excess of the amount of charity proferred to send 5 flunkies half way around the world on a junket. Why not just send a cheque for $75,000 and save us all the insult to our collective intelligence.
Now we understand why RBC which is Canada’s LARGEST MORTGAGE LENDER came out with that propaganda article saying no bubble two weeks ago. They knew sales were going to be bad and hoping lies would help them.
Toronto condo market loses steam as investors disappear
http://www.theglobeandmail.com/report-on-business/top-business-stories/toronto-condo-market-loses-steam-as-investors-disappear/article4457606/
http://www.theglobeandmail.com/report-on-business/economy/housing/no-toronto-condo-bubble-rbc-says/article4436774/
What a joke….
and the truth is..
Toronto condo market loses steam as investors disappear
Toronto condo market losing ground
The stock of unsold condos in Toronto is growing as the market loses some steam.
Urbanation, which tracks the Toronto market, is expected to report today that the number of unsold units hit a record at the end of the second quarter.
At the same time, sales of new units sank to their lowest since about mid-2010, down more than 20 per cent from the first quarter and a whopping 50 per cent from a year earlier
http://www.theglobeandmail.com/report-on-business/top-business-stories/toronto-condo-market-loses-steam-as-investors-disappear/article4457606/
It’s going to be a nasty crash realtors a nasty crash
TO condo offerings up……but sales are down 50%
http://www.theglobeandmail.com/report-on-business/top-business-stories/toronto-condo-market-loses-steam-as-investors-disappear/article4457606/
What’s that smell? Did the reporter say that not for occupancy ‘investors’ were 60% of the market one short year ago? And now ‘they’ve gone away’? This can’t be good.
The Globe has speculation. This pathetic blog published the actual numbers last night. — Garth
#63 Saskatoon-Living on 07.31.12 at 10:42 pm
Hey Garth, did you see Don Campbell on BNN today?? Says Calgary and Edmonton RE is about to take off. What are your thoughts???
http://watch.bnn.ca/#clip731589
Don’t tempt me. — Garth
C’mon Garth, you can’t just say that. There is undeniable growth in Alberta and very low rental vacancies in Calgary. Yes, I get the GTA, Van and Waterloo thing, but can’t you admit that Calgary is booming? Rental vacancies are lower than I’ve seen in 2007!
Yes Garth it’s tough being the Messenger but someone has to do it.
I’m just an average guy, making an average wage and I am barely able to afford rent, food, and gas. I represent 95% of the population and I can tell you I couldn’t afford a mortgage even in Gopher Gulch Saskatchewan.
#11 Ron MacDonald.
Dude, do not give ANY more ideas like that out, ever again!
I could just see Dolton going for it.
This bubble in Toronto will be the biggest in history especially in 416, and pay attention to Newton’s 3rd Law that for every action there will be an opposite equal reaction. The condo market is doomed, so buy nothing until a well defined bottom sets in and there will be blood on the street; be patient as will take time; might be a year or two, but when you smell the blood then take a look to pick up a bargain.
from the REBGV re July:
“The MLS® Home Price Index (MLS® HPI) composite benchmark price for all residential properties in Greater
Vancouver over the last 12 months has increased 0.6% to $616,000 and declined 0.7% compared to last month.”
In the midst of a huge shift in market sentiment here in Vancouver – sales off a cliff, soft prices etc – the HPI indicates… absolutely NOTHING (as if we needed further confirmation that this useless calculation was specifically designed to deceive).
A classic Frankenumber. — Garth
http://www.independent.ie/business/european/france-becomes-the-first-in-europe-to-levy-a-transaction-tax-3187949.html
France becomes the first in Europe to levy a transaction tax
…the tax does not apply to so-called contracts for difference, or CFDs.
They are the same contracts used by businessman Sean Quinn to build up his disastrous 28pc stake in Anglo irish Bank, without having to declare the interest
http://www.belfasttelegraph.co.uk/business/business-news/cameron-urged-to-follow-french-with-robin-hood-share-tax-16192796.html
Mr Cameron and Chancellor George Osborne has said Britain will only consider getting involved in a financial transaction tax (FTT) – known to campaigners as the Robin Hood Tax – if it is imposed across the whole world, to avoid damaging the “City”
=
The Square Mile
Saturday, February 07, 2009
The City of London Corporation: the state within a state
http://taxjustice.blogspot.ca/2009/02/corporation-of-london-state-within.html
#147 Smoking Man
Consider picking up that executive 4bdr in Alderwood for $999K! Is that seller high on fumes from local Alderwood industrials or what? I’d say high by $400K at least. $999K – no basement! Hilarious!
You don’t think big condo price drop will cascade into townhomes into SFH? If soon I’m able to have two 2bdr condos side by side for 1/2 the price of SFH – that doesn’t put pressure on SFH?
#152 truth hammer
Did G&M just re-word this blog post? Same flow, same points, same details.
I’m shocked! — Garth
How precious…look at the G&M spin on 50% drop. Sounds a little bit like the pool/shrinkage explanation – except pool/shrinkage is real!
>
At the same time, sales of new units sank to their lowest since about mid-2010, down more than 20 per cent from the first quarter and a whopping 50 per cent from a year earlier, although last year’s numbers were particularly strong. And over the course of the first six months of the year, sales are at their second-highest level ever.
But this begs the question. 50% down on last year yet second highest level ever? Is that how far out of the park condo sales went in 2011 compared to other years? Condos could afford a 50% sales drop and still come only second to 2011?
Sherill Scooper’s profile:
http://www.bmonesbittburns.com/economics/profiles/scooper/
I know a couple of people taking there house off the market in the lower mainland and waiting until the spring to re-list thinking the market will be in better condition….
the party is over – how do you convince these dumb/nieve people????
Garth – another showcase home from your old hood (Leaside). Were you and Nick Kypreos ever neighbours?
http://www.torontolife.com/daily/informer/gimme-shelter/2012/08/01/house-of-the-week-33-heather-road/?utm_source=rss&utm_medium=rss&utm_campaign=house-of-the-week-33-heather-road
I guess Mr. Kypreos has done better in his post-player career than Doug Gilmour? (since Gilmour’s house was “only” $1.7M — posted for sale 1-2 weeks back).
Nick who? — Garth
#129 Steven Rowlandson on 08.02.12 at 10:48 am wrote:
In a world where the government can tax your property there is no real property rights and ownership is an illusion even if the real estate is fully paid for. There fore there is no reason to pay much for some thing you can not really own.
Well of course you don’t own that plot of land your house is built on. This is Canada. And that means that the Queen owns it. And she didn’t sell it to you or to the guy that you thought you bought it from. The only thing that you own is a contract giving you freehold title to that piece of the Queen’s land: a contract with Her Majesty’s government giving the contract owner a bundle of property rights, providing that the freeholder has paid his taxes. That’s what you bought from the previous freeholder. You never bought the land.
So be careful what you wish for. If the government decides to have nothing more to do with real estate then your freehold title contract with it will become null and void and the land will revert to the Queen. Is that really what you want?
We were in Seattle Washington this past weekend.
Being only 2 hours from HAMcouver….it was eerie. We stayed in Bellevue but went to downtown Seattle.
Construction ?
I saw ONE sky crane near Seahawks Stadium putting up some building, no evidence it was a condo. The skyline is literally devoid of any cranes.
Saw ONE residential condo project as we left Seattle….that was it.
It is different THERE.
#33 Inglorious Investor
In the absence of renewed speculative demand, prices will fall until investors begin buying again. The glut of 1 bed and studio condos is far too great for owners-occupiers to absorb. Demand will come again from investors, but only at prices where it makes sense in terms of yield and risk. This is what we are seeing in the US. Prices are falling, and will continue to fall, until owning is cheaper than renting. In places where this is the case already, prices are bottoming out. Investors are coming out, scooping out deals, providing a price floor.
Unfortunately, in the meantime, young adults and couples only have the existing stock to look forward to for years and years for rentals. This will be the fallout from the bubble, a messed up housing market for a decade.
Updated: Greater Vancouver Benchmark Home Prices Y/Y % Change
Heat-Map Image http://postimage.org/image/rnqfw4sfv/full/
Garth, when you wake up each morning, how can you do this in depth, critical analysis of the days RE events and happenings, but you are totally silent on other things in the market like LIBOR, QE manipulation, HFT (Knight Capital), Pumps and Dumps (FB), Ponzi schemes (ECB), defacto insolvencies (U.S.A., Europe, japan) and fake economic growth (China).
You really expect people are going to pour their house profits or savings into the equity market with this stuff going on?
When did I ever suggest that? — Garth
Anyone know the deal of why the developers are the ONLY ones increasing their pricing? I assume they are trying to prop up the market any way they can, making it look like new houses are still rising (while everything else is dropping)…..
eg:
Nova Scotia:
PID 41248501
$429k -> $438k on June 14 2012
-> $459k today Aug 2 2012
Or
PID 41169236 (same developer)
$372k ->$379k on June 14 2012
-> $384k today Aug 2 2012
And MANY others, by many different developers
Garth you should have summoned me to the fight because I can take down Lamb in 1st round, 10 times out of 10.
according to wsj one should rely on the Bank’s Hard data and no regulators ???? hum…like those stress tests that some passed only to fail later?
THE GREATEST ACCOUNTANT IN THE WORLD
by John McCarten
December 16, 1939
Read more http://www.newyorker.com/archive/1939/12/16/1939_12_16_106_TNY_CARDS_000178627#ixzz22PrPtzDj
the auditor auditing himself
1938 Securities and Exchange Commission (SEC) ruling that dealt with Interstate Hosiery Mills, Inc. (IHM) and Raymond Marien, an employee of the firm’s independent auditors.
modifed accounting
http://www.highbeam.com/doc/1G1-247035578.html
=============
compare what William K. Black has to say in the The latest installment
http://neweconomicperspectives.org/
400 sq. ft. is palatial compared to the smallest condos here:
http://www.blogto.com/city/2012/08/new_in_toronto_real_estate_88_scott/
278 sq. ft.!
How to keep the prices elevated at these extreme levels (especially for SFHs) without raising interest rates. That’s the government’s dilemma. And, despite what Garth believes, I’m sure rates won’t be rising for a long, long time. So, how are they going to do it? What kind of crazy program or giveaways will they introduce to keep up the charade? It will be interesting to see how this all unfolds over the next couple of years.
#124 Pete…….
Most landlords are liars……just like realtors.
===================
Being an X – Landlord, I know the big money times are Aug, Sept.
If you don’t have you place rented out by the end of October you may have an empty unit until January/February. Its simple the kids go to school in september, (supply and demand). Once they settled by october, some will drop out and the unrented units are in for a tough ride. That is the best time to look.
Also with all the new units finally being completed, there will be alot of rental units availiable in the next few months, come November I expect alot of cheap rental units being available, especially those 400 Sqft studio units.
Nostie, that abandoned villa in Italy was gorgeous!
142 Lettuce: “Alberta Ed… dont you mean West SAANICH road? To get from Sidney to Victoria via anything with Sooke in the name means you were seriously lost, or, just don’t care if your’e buying a ton of gas criss-crossing all over the place.”
Yeah, West Saanich Road… and I was seriously lost, but with a whole tank of gas so it was OK.
jjpetes wrote:
“F has taken his punch bowl away in the middle of the party.” ( article quote)
No, he has taken the bowl away at the END of the party now that its almost dry, the middle would have been around 2006 when we had a chance to steer around a financial disaster we now face ahead.”
——-
Where are you concluding that from? F has no deciding power to hold a party, find a punch bowl, fill it, leave it, re-fill it, or take it away at the beginning, middle or end of the party.
You believe that the Canadian government is acting alone to do or not do something in the global theatre? The government is a seamless operator.
Maybe you think such “talk” is “conspiracy theory”? That’s a little old, don’t you think?
Where are you getting your “news” from? The ye olde Goldman Sachs story of calling their clients “muppets” came from them banking on Santa Claus belief systems.
Perhaps you could lay out your argument in detail, because it continues to be a really sore sticking point. What is it exactly that you think “F” was responsible for?
How did you build your conclusions. Can you defend them legitimately with facts? It’s not like this isn’t an important debate to have.
#157 Sebee
No pressure at all. Like comparing dump truck sales to sub compact cars.
Condos suck and in the 416 no land to build SFH. Supply and demand. One month into the engineered slow down and no extra red dots in 416 SFH in my hood nothings for sale apart from a few rediculous priced preoperties.
The condo dots different story. Condos will have lots of inventory for 2 months. Owners will de list and wait for better times. Rates are going down. Only unknow is job market if that loses and bleeds then bubble head heaven
But not with out a fight MSM will super pump
#102 House Horny Housewife
The trend is more of the same. Look for more trendy condos to go up once the market begins to build up steam. Toronto periphery is littered with decades old, once fashionable condo towers, which are now old and busted, and facing $50,000+ special assessments bankrupting their owners. Look on MLS, you can pick one up for a few thousand.
If you want to make money, you still have to ultimately do it the old fashioned way; buy low, sell high, even if, sometimes, buy high and sell higher works for a while.
Hello friends!!
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See: http://www.theprovince.com/homes/Vancouver+July+home+sales+lowest+level+since+2000/7031760/story.html
In the link you’ll see the same old sale down but prices up, but conditions favor buyers. See it’s always a good time to buy…
Anyway, back to my self promotion….
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That 5% back erases the first year of Administration fees. That’s like the first year is FREE.
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Imagine why make 1% in BOC GIC’s, when our “Winning Stocks Index”, is already up 30% for July!!!
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#153 Calgary Boomer
I think a major part of the growth in Calgary is the exponential growth of Governments and Government Services including health care, education, etc at City and Provincial levels along with all the new Government sponsored construction and expansion of facilities to warehouse the muppets and try to accomodate their lifestyles.
Their ain’t no oilwells in the city and the oilpatch in the country Ex Fort Mac is abnormaly quiet and expected to get quieter.
Hiya Garth,
Thanks for taking a beating for the team, of course we all know in actuality it is the famous GT ‘reverse rope-a-dope’, and you win in the end. Numbers can lie but don’t when you lay them out for us like you do. Be prepared to take further beat downs, they can only make you stronger, Garth “the ripper” Turner.
“Vancouver realtors are calling it a “summer lull” but the city’s real estate market appears to be in full retreat. (*The first time I have seen this tone in the MSN).
The Real Estate Board of Greater Vancouver said property sales in the area remained stuck at 10-year lows in July, dropping another 11.2% from June.
There were 2,098 residential property sales of detached, attached and apartment properties in July, off 18.4% from a year ago. It’s the worst July since 2000 and 31.2% below the 10-year average of 3,051 sales for the month.
“People appear to be cautious about making significant financial decisions right now. While our local economy appears to be quite robust, there may be some concern about the impact of international markets and the federal government’s tightening of mortgage regulations,” said Eugen Klein, president of the board.”
Over
http://tinyurl.com/bs22rcv
#166: Hoof-Hearted, I’m not really sure where you were in downtown then if you saw only one crane. I live at Pike’s Market and from my window alone, I can count 17 cranes in the downtown core (which is tiny, mind you) alone. That doesn’t count Belltown, South Lake Union, or Capitol Hill, which I know currently have an addition 26 cranes in those neighborhoods.
149 truthhammer:
It`s going on everywhere — Alberta`s latest political scandal hit yesterday — ironically while the Premier is on an $84k trip to London to `generate business`
http://www.calgaryherald.com/news/alberta/Alberta+health+minister+outraged+another+executive+leaves/7030914/story.html
The Real Estate Board of Greater Vancouver said property sales in the area remained stuck at 10-year lows in July, dropping another 11.2% from June.
There were 2,098 residential property sales of detached, attached and apartment properties in July, off 18.4% from a year ago. It’s the worst July since 2000 and 31.2% below the 10-year average of 3,051 sales for the month.
“People appear to be cautious about making significant financial decisions right now. While our local economy appears to be quite robust, there may be some concern about the impact of international markets and the federal government’s tightening of mortgage regulations,” said Eugen Klein, president of the board.
http://business.financialpost.com/2012/08/02/vancouver-real-estate-market-in-full-retreat/
Meanwhile – down in the States, where there ‘is no recession’.
“Even the rich aren’t immune to the pressures of the housing market.
Prices for homes priced at $1 million or more have fallen a 20 percent this year, according to RealtyTrac. The average sale price for top-tier real estate has fallen to just over $2 million, from $2.5 million in 2011.
Those prices cuts stand in stark contrast to the broader housing market, which is seeing early signs of price stability and even price increases for the first time in years.
All that price-chopping at the top, however, has sparked a wave of sales as buyers scoop up deals and sellers accept the new reality of lower prices.
The number of transactions for homes priced at $1 million or more has jumped 18 percent this year, one of the strongest increases since 2008, according to Realtytrac.
Brokers for luxury real estate are already calling 2012 the “The Year of Capitulation” for wealthy sellers.”
http://tinyurl.com/cdhp8mg
The price declines have started.
We’re in Winnipeg. Had our home appraised in ’09 at $285,000 to $300,000. This week a dream home in our neighborhood came up for sale – $375,000. We looked at it and asked the listing agent what our home would sell for in today’s market – she said, “$300,000”.
That means no gains despite 3 years of the local media saying house prices were up 8%, 9 %, blah, blah blah.
I am so angry.
(BTW – Hubs and I have DB Pension Plans, RRSPs, and an RESP for our kids.)
#119 maxx on 08.02.12 at 9:45 am
Lol, Factory sharp incisors are formidable as it is and you come up with aluminum leeching! (chuckles, I hope Garth has some good healers on the shelf). Clearly, its not safe out there. It took some mustard to face ’em solo, Garth. If you ever need backup ;)
#184 The American on 08.02.12 at 4:11 pm
We went from Bellevue Embassy suites, to Space Needle ,EMP, and Mariners game…that area…..scoped the City from the nosebleeds at Safeco filed …as well as I-5….saw nothing. Maybe my view corridor was blocked….but it must be in concentrated areas.
My main point was it was different than Vancouver area, where construction is everywhere. It is quite a stark difference once you cross the border.
Just noticed a new subdivision here in Parksville. “Sandalwood Drive” houses on market for 247 days. price reduced from $629,000 to $499,000. Granite etc…thats over a 25% price reduction. Becoming very common here in Qualicum Beach and Parksville
DELETED
#155 Sparky……pricing for suckers is an old scam. The old game goes like this….the developer will put put sold signs on several doors or windows of whatever the project is…pretending that those units are sold….the agents are told ‘what they sold for’ which is never true….they haven’t been sold.
The developer then ‘bumps up’ the price of the remaining units pretending that the project is on a roll and create the idea that there is a demand……even a shortage !!!!! Believe it…this scam draws in the suckers every time…always has.
Once the middling units have been sold to suckers then the developer magically releases the other units that the misled public and hurried buyers thought had been sold…but it’s too late ….the suckers have been hooked and landed…..deposit and all.
I have seen many people get furious when they realize that they were duped into a purchase….but there’s nothing they can do.
We see the same thing when project marketers hire shills to stand in line in order to create a false impression of interest.
I have been screaming in the dark for Canada to adopt American style disclosure laws to protect the buying public from this obscene manipulation…..but to no avail. The newspapers don’t have to disclose who what or where the ad dollars or script copmes from and the advertisers are free to use any disceptions they like while plying their trade. The only rule in Canada is Caveat Emptor……Let the buyer be aware……sad and makes us look like a banana republic by comparison to countries with consumer protection laws..
Another pet peeve of mine along this vein is the number of health and consumable products that have been banned internationally that are allowed to be sold on Canadian shelves long after they have been proven to be deadly.
Civil servants only want you think they are doing their jobs until we see during some disater or emergency that they are the most incompetant and corrupt boobs this side of Zimbabwe……but we keep paying ’em…….
Sorry see Bev Oda resign in disgrace instead in chains……..and she still gets a million dollar pension for only 8 years as a civil servant…….When are you dipwads going to wake up?
#178 Smoking Man on 08.02.12 at 3:51 pm
>No pressure at all. Like comparing dump truck sales to >sub compact cars.
Dump truck to sub compact – I say nay nay. Civic to an SUV perhaps yes. SFH and Condo both have place to sleep, park cars, cook food. If Condos drop to where I can buy something equal 3 to 4 bedroom 1500-2000sqft in condo space to SFH – it has to put pressure on SFH. Think iPad and laptops. Let’s rememer the boomers who own these SFHes will be cashing out too as noted in previous blogs.
>But not with out a fight MSM will super pump.
Ain’t that special truth. I hear The Star sold some parking lot space for a new triple building condo project at One Yonge – you don’t see anything on thestar.com today about Toronto condo sales, do you? Add to that their interest in marketing funds from the RE sector and banks and it doesn’t take a genious to know that RE bubble pop won’t be fun for the MSM and papers in perticular.
Oh sheat! I mipelled genius!
My apartment complex here in Calgary has had signs out advertising suites for rent for the last 2 years. As a matter of fact , some of us just got rent reductions.
So saying that there fewer and fewer rental units in Calgary could be a matter of preception.
Agree #96
Been living in Malaysia for the past 5 years (some time in Canada during that time)…
Seeing a specialist $20, western trained.
Dinner a chilies for 2 adults and 3 children, $18.
Starbucks – same price, haha.
Can’t beat the weather though.
Unsure about my condo prices though. Bought in the best part of Penang (Gurney area) for $100k 4 years ago, now worth approx $250k … about 800RM ($270k Can) / sqft.
What to do…
No problem here…..even though my units are 2 ft X 3 ft X 10 ft. Very green..no plumbing, wiring, water, etc.
People are dying to get in here.
Some are trying to Pre-Use, at least sleep overnite with built in Cable TV (HGTV). Mind you ,I don’t care, but the security guards are freaking out with people climbing out to have a dump.
Seems like we’ll have to form a Strata Council (sigh)…the next worst thing besides Hell .
Smoking Man….settle down…even the Perma Residents are complaining.
I got deleted.
Seriously. Garth must be on vaction and the smallest brested amizon has her trigger on the delete button.
Sweety smoking man will make you go ahhhhhhhhhh
Brad Lamb is like a stock picker during a Bull Market.
Let’s see how he does while in a viscious unimaginable, volatile BEAR market. It’s all about money management and cash flow.
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#169 Not 1st — “You really expect people are going to pour their house profits or savings into the equity market with this stuff going on?” — Actually not a bad idea, ‘tho a mixture of investments is better.
The opportunities are still there, it’s just that TPTB are rearranging the deck chairs, moving their money all over to take advantage of all these gifts. Subsequently, they are reaping profits, and we’re not.
The investments plus renting a decent place for a decent price would give a leg up to those who wish to stay debt free for life. Income from the investments would pay rent and buy food.
#193 truth hammer — “. . . and she still gets a million dollar pension for only 8 years as a civil servant…….When are you dipwads going to wake up?” — Some of us are awake, but we’re in the minority. Hence, nothing we can do, short of having a revolution.
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2:31 clip New clip from Clarke and Dawe and QE. Damn funny; 9-11 repeat? “This is EXACTLY what happened 2 days before 911.”; Three min. clip “Stripped bare, US economics reveals we do not have a ‘money supply’ but its Orwellian opposite: a ‘debt supply’.” Hmmm. All possibilities exist, they haven’t manifested themselves. Yet, and this. Kinda goes hand-in-hand. “The war with Iran has to do with gold, its use as currency and its exposure of the central banking cartel’s lack of gold which defines a fiat currency’s worth. And right now, the US dollar is absolutely worthless.”; Giant Sinkhole Resembles the economy; ECB Convoluted balderdash; 5:53 clip QE3 likely in Sept.; How To Go Broke Overnight, and Vaporizing Pensions.
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2:37 clip Florida kids growing their own fruits and veggies; Who Is The Greatest Threat? “Since the 1979 Iranian revolution and the downfall of the US Puppet Ruler the Shah, Iran has been an Islamic state. In that interval of time, 1979 to the present, Iran has not invaded anyone. Not once. People of all religions live in peace in Iran, even Jews, who find life so comfortable in Iran they refused an offer by the government of Israel to emigrate!” wrh.com; Russia Restoring bases; 1:08 clip Be aware; Smoking Man — Education is evolving into a military-based process; Rationing “Plenty of money for bombs and bullets to kill people worldwide including right here at home!” and Martial Law and Big Pharma “This “Blue Angel” project, as it’s called, suddenly puts the Pentagon in the forefront of the vaccine business.”; Facebook Using fake accounts; Digg v.1 Not sure I understand this; PDF viruses More jitterbug stuff on computers.
…. thestar.com is quite happy to talk about Vancouver. But after that parking lot sale – they have no idea on what’s up in Toronto condo market.
http://m.thestar.com/article/1236133–vancouver-home-sales-hit-lowest-level-since-2000
#196, what is the name of the apartment complex?
My friend is looking for an apartment to rent.
#daniel 197 you ever make it out to genting hieghland casino I love that place top of the mountain.
The Harper regime loves Whereverstan’s immigrants. They are used to bowing, to the ruling despot. They will not make trouble with government. Despot rules.
They are used to fake ballots. Glorious despot every time!
Economic strife? Unbridled military spending while pesants do without? De rigueur under Despot. Welcome to Canada. Fast sinking to Whereverstan’s level
#185 DM in C
“In 2007, Merali was paid an annual salary of $487,000 at Capital Health.”
Paid more than Obama which IIRC is $440K/YR not including his expense allowance. Pinch me!
@ #193 truth hammer
Thanks.
I’ll have to take a look this weekend for fake sold signs, as I will be out that way.
Easy to tell if they are fake, as we have a great real estate service here called http://www.viewpoint.ca that shows sold listings along with a whole lot of other very useful data.
I know this is going to get deleted but
DELETED
Is there a Bunkerstan?
Why blame whereveristan? I’m half whereverstani and half Serbian and I’m sick of having this blog shovel blame on my glorious heritage.
What drugs is this realtor smoking, and where can I get some?
The Stewardship of Beautiful Homes
Connect With Spice
“I believe the buying and selling of homes presents us with unique and exquisite opportunities to transform our daily lives. We all have within us a deep longing to connect to our community and ourselves. Our homes embody that need. As a realtor, I see myself as a steward or perhaps conduit assisting the magical and very often intimate process of finding a place you can call “home”.
I have a vision of using this business transaction as a form of engagement between buyer and seller while honouring the sharing impulse that guides us intuitively to do what is right on all levels. I imbue this co-creative process with truth, honour, integrity and trust in our joint quest to find beauty and belonging. And of course, whenever the moment arises….throw in a dash of Spice!” From Spice Lucks ReMax website
#177 John on 08.02.12 at 3:50 pm
Hmmm… you are saying the government doesn’t set “government” regulations? By all means, don’t hold back on us. If you want to beat up blog dogs for kicks, the least you can do is throw the rest of us a bone. C’mon, lets hear some names John. If you’ve got it all figured out, why hold back on us or is this your one trick pony, the best you can do, run bloggers down and leave us all hanging?
Lets hear some names. If government isn’t governing, mere puppets as you would frame it, then who’s behind the strings? C’mon, land the plane in the airport, we’re all ears.
#210 PoorgEoisie
leave?
#165 Derek: “Well of course you don’t own that plot of land your house is built on. This is Canada. And that means that the Queen owns it. And she didn’t sell it to you or to the guy that you thought you bought it from. The only thing that you own is a contract giving you freehold title to that piece of the Queen’s land: a contract with Her Majesty’s government giving the contract owner a bundle of property rights, providing that the freeholder has paid his taxes. That’s what you bought from the previous freeholder. You never bought the land.”
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That’s interesting. Realtors play up ‘freehold’ like it’s a big deal, at least in the Okanagan.
But actually, it’s not much different than band land in which the developer negotiates with the government on behalf of the band to ‘lease’ the land — he holds the Head Lease. It’s developed, and sold to sub-lessees who ‘own’ it for the leased term, generally 99 years. The lease is often/always paid out. And who really cares what happens 99 years down the road?
In BC the property taxes for band land is determined by the BC Tax Authority, just as it is for all BC properties. The mill rate is determined by the band and in some years, the rate is less than ‘freehold’ properties.
For all of us…just try not paying your property taxes and see what happens! LOL
Must admit, nicely played MSM. You found a way to spin the 50% drop with the second highest sales volume on record.
http://www.cbc.ca/news/canada/toronto/story/2012/08/02/toronto-condo-market.html
#213 Daisy Mae on 08.02.12 at 8:59 pm wrote:
That’s interesting. Realtors play up ‘freehold’ like it’s a big deal, at least in the Okanagan.
But actually, it’s not much different than band land in which the developer negotiates with the government on behalf of the band to ‘lease’ the land — he holds the Head Lease.
Spot on, Daisy! The only real difference between freehold and leasehold is that with freehold the Queen allows you to hold the land (rent-free but not tax-free) and with leasehold someone else (who has the freehold) allows you to hold the land (normally neither rent-free, nor tax-free). In the UK, a lot of the land in central London is leasehold and though you can buy a house, you cannot buy the land it stands on.
#213 Daisy Mae
#215 Derek R
Is it just me, or does this sound exactly like renting except with more costs and tenant gets to do all his own maintenance instead of the landlord?
@Turner Nation, Post #200:
I hope Brad Lamb is heavily leveraged and gets shot down in flames during the inevitable bust (like what happened to Bramalea Inc. during the last real estate bust), loses his shirt and dies in severe agony of starvation.
Love how the Toronto Real Estate Board plays with numbers:
” GTA Home Prices Up in July ” says the most recent issue of Market Watch published by the Toronto Real Estate Board.
CIBC quotes real estate board: “In Toronto, the average selling price in July was $476,947, up four per cent from a year ago, while the MLS home price composite index was up 7.1 per cent year-over-year.”
But not until you get to page 27 of the issue do you see these average price numbers:
$516,359 April 2012; $515,501 May; $507, 809 June; $476,947 July
4 straight months of declines!
Wow, I read the comments section twice in a few months and find another possible panic comment posted. Gotta say….
#88 Tony:
Sorry, not true. Perhaps someone told you this, cool, just have to clear this up…
The only thing, other than non-payment of home insurance, non-payment of property tax, & a couple of super obscure, complicated circumstances that gives the lender the right to “realize” on the property (issue Notice of Sale and take it back) is non-payment of the mortgage payment. Any lack of equity is irrelevant regardless of how much disappears. (this is why the new rule re having to re-qualify for renewals was scrapped as it would have changed everything and added a 100 lb weight to a totally sinking canoe, and, um, wiped out the loansharking industry for no reason.) Oh yeah, they didn’t go through with it! (it wasn’t just because of the wave of NOS and how bad they would have looked contributing to the inevitable crash coming…duh). Bank = self interest. Period.
Think of it this way, as this is how the lender thinks of it >> CASH COW. Loan sharking CASH COW. I say LS because of how much money they make off of the borrower’s payments. Ridiculous. I digress…. it is what it is.
SO, rather than send a zillion home owners on here into a tizzy, having them think that should they manage to keep up their payments and decide to ride things out as opposed to selling at the top, they will LOSE their properties. Hopefully they will go back to read this comment. If not, damage done. Most people will have believed it and not go and do their research.
It’s going to be bad enough from so many angles. This angle just isn’t true. Noone needs the additional stress.
Cheers.
p.s. my comment above is relevant for homes on land as well as condos. If condo law is different, although that would make no sense for the same reasons, my bad. Bottom line, lenders don’t shoot a horse that doesn’t have a broken leg that is producing a profit for them. Lack of equity is simply irrelevant.
p.p.s. Just so there’s no confusion at all..
The lender NOT realizing on your property because of lack of equity is not just a good loansharking move, it is ILLEGAL. This is why it is NOT part of your mortgage documents in the section that talks about recourse, i.e. their right to snatch your property from you.
Oh, and I should mention, the MOST serious thing you can do to put yourself at the most risk of losing your property is screw up your property tax payments. Just sayin’…. you don’t even want to know those laws, trust me.
So, if your not paying them automatically as part of your mortgage payment just make sure that, if you’re ever strapped, you pay those property taxes and the mortgage payment and not let yourself think that they’re less important than the mortgage payment. They’re not. Not by a long shot.