Pooched

The biggest real estate news this week has to be a 70% plunge in new home sales in Toronto. No, not Phoenix or Cleveland. Or poor Vancouver. I said Toronto, the centre of the Canadian real estate universe.

This is the worst August number ever. It’s the lowest monthly total since the depths of the financial disaster of 2008-9. The collapse from July was a stunning 45%. And it’s scaring the poop out of an industry which has 93,000 condos being planned, marketed, constructed or completed. Supply is about to drown demand. This will not end well.

Says housing analyst Mark Hanson: “I have never seen this type of demand destruction anywhere before. Not even in the US.”

But it’s not just new builds in Toronto. Resales also slagged last month in the GTA, down 12.5%. In Montreal, the city just had the worst real estate performance in 15 months, with sales sliding even before Quebec’s recent self-inflicted PQ wound. I told you last week about New Brunswick being buried in 6,000 new listings, while buyers flee. In all of Nova Scotia on Monday, just 39 houses sold while 80 more came to market and 84 others dropped in price. Across BC, sales fell 25% in August, a number eclipsed by the 31% plop in Vancouver.

In Edmonton, sales are down 11%. In Saskatoon, off 6%. In the Okanagan, lower by 23%.  In Ottawa, a 14% slide. And in Winnipeg, a modest 4% reduction.

In short, no place is safe. It’s not different anywhere. As this pathetic blog has pointed out for an eternity (well, it seems like it), there are no positive economic fundamentals supporting today’s bloated house prices. So, sales tumble first, then prices. You are witnessing Act One. If this were a Sudbury lap dance, we just lost the parka and boots. There’s way more skin to come.

Was it only a few days ago some economists were calling my words “bunk”? Saying it would take some kind of external disaster, “a major economic recession, a downturn, or perhaps a financial crisis, a political crisis,” to rattle real estate?

You’d think economists would be able to see what average folks do. Prices are ridiculous, the economy’s barely moving, wages and salaries are flat, gas and food costs a fortune and we all have too much damn debt. Besides, 70% of Canadians already have houses, so how much actual demand is there? Meanwhile credit’s been tightened thanks to F & the Peckerettes, so mortgages are more expensive and more elusive for first-time buyers. Cash-back loans are gone. HELOC limits have been slashed and equity-based mortgages are being phased out. Like, what did these guys expect? Why should anyone buy right now?

And this is where human emotion cues.

People are desperate to buy things that are rising in value (popular and in demand), and loathe to invest in stuff that’s falling (shunned and devalued). This is why most folks buy high and sell low. It’s why they wanted Nortel at $120 (now zero) and RIM at $150 (now $6). It’s why investors panicked to sell mutual funds in March of 2009, as they hit bottom. It’s why they bought houses in Vancouver for an average of $1.2 million last March, and don’t want them now at $200,000 less.

That’s why news of sales declines – especially the kind of shocking, white-knuckle disintegration in Toronto this week – almost always brings more declines. Buyers retreat fast, recoiling from what they perceive as increased risk, which is buying into a falling market. The inevitable result is a drop in prices, as sellers use their only weapon to rekindle demand. The next few months will give all the evidence you need.

And here’s the other funny thing about humans. When house prices soar, the number of sellers dwindles. Instead of saying, “we could sell and score right now,” people say, “my house is making me rich!” Yet when prices tank and listings mushroom, people scream, “I’d better get out now!”

To conclude. Houses are stupid expensive. Families are steeped in debt. The economy is slowing. Credit is more expensive, harder to get. And now real estate may be hooped. Suddenly renting that condo looks far wiser than buying it. Suddenly virgins who put 0% down last year look sacrificial. Suddenly Boomers who didn’t sell at the top look like fools. Suddenly economists look like shills.

You got liquid when I told you, right?

238 comments ↓

#1 Kurt on 09.24.12 at 9:17 pm

Dog needs goggles. I’ve seen it done, protects their eyes.

#2 vancity on 09.24.12 at 9:20 pm

In before turner nation

#3 darko on 09.24.12 at 9:20 pm

First….

#4 tofino gal on 09.24.12 at 9:21 pm

Yup, yup, yup….money is tough to make, harder to replace..and if your investment isn’t making money, as my American friend likes to say..it doesn’t count.

#5 T.O. Bubble Boy on 09.24.12 at 9:21 pm

Plus, HELOCs and the Smith Manoeuvre are now far more difficult to get (maximum 65% loan-to-value).

http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2012/09/did-osfi-kill-the-smith-manoeuvre.html

#6 Juanita Violini on 09.24.12 at 9:24 pm

Right! You’re our hero.

#7 Ben on 09.24.12 at 9:27 pm

Hello Garth,

Any links to the scary figures you are quoting?

Thanks in advance.

#8 Jon B on 09.24.12 at 9:27 pm

Always have been.

#9 Freedom First on 09.24.12 at 9:28 pm

I am a very sick individual as I really enjoyed this blog today Garth. Thanks, and I don’t know how many people in Canada are able to enjoy the humor in your article today Garth, but I was in stitches:)…….and I can’t say I feel bad about it either…..sorry….

#10 Adviser on 09.24.12 at 9:30 pm

So far in my tiny hamlet of Churchville (Brampton/Mississauga border) prices have fallen by on average 10-15% since the spring peak levels. Properties priced well or below value sell while the rest remains deflating slowly as owners realize that the have missed an opportunity of a lifetime.

#11 Roy on 09.24.12 at 9:32 pm

Condo marketer Cameron McNeill on CBC National:

“The fundamentals that are driving the market below the surface are just too strong for any sort of bubble circumstance to happen,” says McNeill.

http://www.cbc.ca/news/canada/british-columbia/story/2012/09/20/bc-housing-bubble-garth-turner.html

John McCain on Sept. 15/08: Fundamentals of our economy are strong

http://www.youtube.com/watch?v=tSBs0tBVrHk

#12 Canadian Watchdog on 09.24.12 at 9:33 pm

“Houses are stupid expensive. Families are steeped in debt. The economy is slowing. Credit is more expensive, harder to get.”

But…. Canadians comfortable with debt

“It appears that saving money ‘for a rainy day’ has been replaced with access to debt to deal with financial problems,” says Ted Michalos, a bankruptcy trustee with Hoyes, Michalos. “What’s even more shocking is that one in five Canadians believe it would take them two months or longer to come up with $2,000, even if they could borrow.”

#13 Smoking Man on 09.24.12 at 9:34 pm

DELETED

#14 Renting in Sherwood Park on 09.24.12 at 9:35 pm

Great post Garth. You state facts based on facts. I don’t think the word “fact” is used in any realtor course material.

#15 Mark W on 09.24.12 at 9:39 pm

I remember once several years ago having a fascinating talk with this senior citizen.

He told me that he got married in 1935.

At the time his wife and him discussed buying a home and came to the conclusion that such a move would be foolish because “prices next year will be lower” after several years of a Great Depression.

In a deflationary market a lot of people start thinking this way (correctly) and then things become even more dangerous for the sellers.

I have noticed in business that when things get really bad it is the people with solid credit that stop buying first, and it is the dead beats who continue to apply for credit.

The smart money stops and the stupid money continues, or at least tries to.

You see the same effect with car loans and credit cards.

Smart people use credit cards for convenience and do not spend money they do not already have and the balances are paid off in full every month – but it is not this crowd that banks make their money from.

Factor into this equation the utterly huge demographic born from 1947 to 1954 who are entering retirement years.

Who exactly are they going to sell their homes to?

#16 Old Man on 09.24.12 at 9:39 pm

Imagine my utter shock about this all, as no idea that such could take place.

#17 TO Reader on 09.24.12 at 9:42 pm

Garth was mentioning that Winnipeg had a slight sales volume decline. But Winnipeggers shouldn’t feel secure. Housing peaks at different times in different places. Note that Miami, Las Vegas, Seattle, Raleigh, Dallas all peaked at different times in the US.

And Winnipeggers (not sure if that’s what they call themselves — hey, I’m sitting in Toronto!) shouldn’t feel immune because they aren’t “Vancouver or Toronto”. I was just in Thunder Bay and even over there, they have bidding wars. The whole country took RE to new extremes.

#18 Smoking Man on 09.24.12 at 9:45 pm

Garth,

Soon the Matchine will put out news to the contrary and the idiotes on track six will buy the GTA right back into record territory.

They have this all mapped out, since 1901. Listen to me and I’ll make you ritch, and I can drink you under the table.

#19 Herf on 09.24.12 at 9:46 pm

#13

Realtors are probably taught how to use a FAX and how to manipulate, ignore or lie about the facts.

#20 Smoking Man on 09.24.12 at 9:48 pm

Gratho perhaps you should delete my prior post, I held back to much. It’s not me.

Back to topic, 75% Condo’s no surprise. Lets face it who is building SFH in the 416

416 Bidding wars still on, after 6 months of gloom and doom.

I predict that SFH in the GTA will be more that Vancouver SFH in 12 months.

75% why don’t

#21 Realtor #1 on 09.24.12 at 9:50 pm

from theredpin.com

listing down 9% w/w

People wait it out , listing will dry up

#22 Smoking Man on 09.24.12 at 9:51 pm

#14 Renting in Sherwood Park on 09.24.12 at 9:35 pm
Great post Garth. You state facts based on facts. I don’t think the word “fact” is used in any realtor course material.
………………………………………………………

So get with the program, what is wrong with lying. Show me anyone that earns 7 figs + I will show you a liar.

#23 NKVD Black Raven on 09.24.12 at 9:52 pm

And it’s scaring the poop out of an industry which has 93,000 condos being planned, marketed, constructed or completed.

Tony really has been banging, digging & hammering away all over downtown. It reminds me of a story in an old Star Trek annual from the early 70’s. Jim & co were on a planet of city builders. The machines were automatic and kept on building away and the poor locals didn’t know how to stop them. Eventually 90% of the planet was covered in useless, empty buildings. I wonder where the author got the idea from back in the 70’s?

#24 Doug in London on 09.24.12 at 9:52 pm

Some people out there have the sense to do what Garth has been trying to tell us for what seems like an eternity, such as in this link: http://www.tgam.ca/homecents

#25 Dave on 09.24.12 at 9:55 pm

There is no doubt that these GTA sales numbers are scary…

The September sales numbers will be absolutely crucial. If they are even close to being this bad, the media will really start to pile-on.

#26 mid-Ontario on 09.24.12 at 9:55 pm

The biggest real estate news this week has to be a 70% plunge in new home sales in Toronto. …
This is the worst August number ever. Garth
———————————————————–
This is very unsettling. Same thing happened in 1989. Took almost 20 years to recover.

I hope for the sake of all reasonable people that this is the start of a slow melt and not a sizzling melt down.

#27 Jim on 09.24.12 at 10:00 pm

#18

“I hope for the sake of all reasonable people that this is the start of a slow melt and not a sizzling melt down.”

What do you mean by ‘reasonable people’? Do you mean people who didn’t participate in this housing bubble? The people who actually saved money, instead of gloating about how rich they were becoming through real estate? Or do you mean something else?

I’m salivating over the prospect of a massive downturn, similar to the US. This has been a malinvestment of energy and capital, and the sooner it corrects the better.

#28 squidly77 on 09.24.12 at 10:00 pm

Some people may get joy from the currently in full motion Canadian housing crash. I get none.

Garth Turner is a federally elected and very well respected politician, Ben rabidoux is a most excellent economist and journalist, Canadian watchdog is obviusly government and I on the other hand, am just a lowly mechanical and structural engineer.

We have one thing in common. We took our free time to try, just try to send a message that Canadian housing was extremely over priced and manipulated by the various real estate boards and the realtors that support them. Few listened.

Realtors spew their rhetoric on this site, they purposely cheapen it with mindless comments and simpleton stories of their supposed success,I.Q. challenged realtors dominate the comments on this blog. I for one am sick of reading some of the commentators here. Smoking man-buzz off, truth hammer the same. They are simpleton realtors that are infecting this most excellent site.

Listen folks, house prices and sales are falling fast, but be careful with your joy. The time for warning has past, It’s too late. The crash is now.

#29 Smoking Man on 09.24.12 at 10:01 pm

#6 Juanita Violini on 09.24.12 at 9:24 pm
Right! You’re our hero.
……………………………………………….
Seriously?

#30 torontorocks on 09.24.12 at 10:01 pm

and prices is the last to fall, they say. with continued bidding wars, prices going over asking, does anyone care if rates continue to stay low. if rates stay low, I would imagine big principal payments could be made that gets that extensive debt amount to a reasonable level. and only if rates increase would there be a structural hit that would cause defaults on that debt. and given that rates have gone no-where since 2008, you are effectively on your way to being priced out as a new floor is reached. no? yes? what?

#31 Not 1st on 09.24.12 at 10:03 pm

So Regina is safe then?

#32 joey jo jo on 09.24.12 at 10:03 pm

“You got liquid when I told you, right?”

Sure did! Thank you for saving my wife and I from financial ruin! Your advise also helped me to grow our net worth substantially! Unfortunately I couldn’t help my friends and family here (many of whom work in construction). They’re all still completely clueless about the explosion in listings and point to high listing prices as proof the market is still hot. Crazy!

#33 Smoking Man on 09.24.12 at 10:03 pm

#18 Smoking Man on 09.24.12 at 9:45 pm

Above, That’s a fake, but I agree……..

Nice Job fake SM

#34 Canadian Watchdog on 09.24.12 at 10:05 pm

#20 Realtor #1

It’s called: “I don’t need a realtor, I’ve done this before.”

#35 randman on 09.24.12 at 10:06 pm

Economic war declared on Canada

“Did you smile or cheer when U.S. Federal Reserve Chairman Ben Bernanke announced Quantitative Easing III (and the markets went up)?

He just declared war on your job, and the whole Canadian economy.
Read more at ”

http://globaleconomicanalysis.blogspot.ca/#1g5270oyZ34fOWTk.99

http://globaleconomicanalysis.blogspot.ca/

#36 Julia on 09.24.12 at 10:07 pm

WTF?
2013 Expected to Heat up Condo market Across Canada, Syndicate Mortgages
http://www.equities.com/news/news-headline-story?dt=2012-09-24&val=511940&d=1&cat=headline

Check the source. — Garth

#37 KG on 09.24.12 at 10:09 pm

The one’s that have been always liquid, why do we follow your blog ? You must be awesome.

#38 tkid on 09.24.12 at 10:12 pm

NP Link:

http://business.financialpost.com/2012/09/24/toronto-new-home-sales-fall-to-record-low-in-august/

#39 LuckyRenter on 09.24.12 at 10:12 pm

#7 Ben on 09.24.12 at 9:27 pm

The scary figures were on The National tonight.
65% drop in sales in Toronto.

#40 Big Bear on 09.24.12 at 10:13 pm

And yet, most are still in denial. I’ve been posting on CBC.ca for months along the themes you blog so pathetically yet eloquently here and very few agree with us. It’s frightening how dumbed down they are. We let 30% of us elect a majority of deceptive conservatives, let’s just call em the bad guys that they are… DECEPTICONS.

#41 T.O. Bubble Boy on 09.24.12 at 10:14 pm

If August was down 70%, what will happen when the last of the 30-year mortgage pre-qualifications from July expire in October?

#42 Gord on 09.24.12 at 10:14 pm

“You got liquid when I told you, right?”

Yep. Two years ago. Values in our neck of the woods never did rise beyond that point, and of course are now into Stage 2 of a monster retreat.

Selling at that time was one of the smartest moves we’ve ever made, and I thank my proverbial lucky stars that I ran into your blog back in early 2010.

Thanks, Garth.

#43 harden on 09.24.12 at 10:15 pm

“If this were a Sudbury lap dance, we just lost the parka and boots.” LOL

Hey CBC’s Philip Chan at ReMax has another open house scheduled for his top of the market Kits triplex scheduled September 30th. Who’s goin?! Photos!

#44 Smart Blonde on 09.24.12 at 10:19 pm

I love it when I can say “I told you so!” :) To all you realtors, friends and young fools who didn’t see the down turn in the 80’s or 90’s and kept saying its different here. “I told you so!”

Thanks Garth for the time and effort you put into this blog. We sold our house 2 years ago, and have been waiting for this!

In the meantime, we purchased a vacation home in Scottsdale, Arizona. Yes, the prices were down as much as 50% in some areas, and are up 15% since this time last year.

Timing is everything, and throw your emotions aside. I can tell you, I have always loved having my own house, being able to decorate it how I please etc etc. But, renting a new place with a view, for half of what it would cost to buy a month hasn’t been a bad decision. Especially with Vancouver Tanking!

Thanks so much again Garth.

#45 harden on 09.24.12 at 10:20 pm

“70% of Canadians already have houses, so how much actual demand is there?”

But.. but.. everybody wants to live here!!! LOL

#46 squidly77 on 09.24.12 at 10:23 pm

It’s your friends, family and co-workers who are getting thumped. Don’t gloat.

#47 Old Man on 09.24.12 at 10:24 pm

Now for you that bought a condo in the core of 416 have a message for you – SELL SELL SELL.

#48 Larry from ON on 09.24.12 at 10:26 pm

Heya Garth,

I did get liquid at a good time. What advice would you give for deploying cash to build up the portfolio: set target price points and wait? set a time frequency of purchases and stick to it? jump in and keep some on the side waiting for a downturn/buying opportunity?

Get some help. — Garth

#49 City that smells like it sounds on 09.24.12 at 10:26 pm

Regina must be still going up, don’t see it ever mentioned.

#50 Toronto_CA on 09.24.12 at 10:27 pm

Well, to be clear it is “new” home sales, so the majority of those in the 416 has to be condos, townhouses, and lowrises. Detached SFH will be the last to melt, and in some hoods they probably won’t until interest rates rise and they become unaffordable even for the people grossing $200k+.

I do like seeing the condo market crash hard. Ridiculous pricing and overbuilding.

#51 Silver on 09.24.12 at 10:27 pm

I will gloat and sit and drink hand roasted coffee…
in my roof garden as this pile of crap melts down…
in vancouver…

and go…
Ta Da….i told you so… idiots…

richer than they think..hee hee hee
and more in debt tooooooo………
idiot are still buying here…

Silver

#52 Smoking Man's Spellchecker on 09.24.12 at 10:35 pm

I give up! I quit!! The SM murderizes and smallygorps the langij and I just can’t take it anymore!!!

I need a drink.

#53 Van Isle Renter on 09.24.12 at 10:39 pm

From National Post Sept 24:

“High-rise sales, buoyed by the city’s booming condominium market, may finally be slowing. August high-rise sales in the Greater Toronto Area were 645, down from 1,967 a year.”

That’s like saying, “The fall won’t kill you, it’s just the sudden stop at the end that you have to be aware of”

#54 Regan on 09.24.12 at 10:47 pm

Yeah, sales are down. But it’s August, sales are always down. I don’t see proof yet of the big melt here, and I’ve been thinking this market hasn’t made sense for 6 years now. The reality is that governments have the power to defy economic sense. Logically, the cost of borrowing money should skyrocket if supply and demand held true. But governments have too much debt, so they keep bond returns at negative value. And it’ll happen for a long time. In the meantime, savers get screwed with no returns, people chase the latest money makers trying to do better, and interest rates stay low so individuals risk running up their own debts. The alternative is letting inflation run rampant to water down the debt, maybe by the end of this we’ll try that one too.

#55 Canadian Watchdog on 09.24.12 at 10:53 pm

#50 Toronto_CA

“Detached SFH will be the last to melt”

Nope. Detached will be first to melt because it makes up most of dollar volume and are less liquid. We may see condo prices fall in the short run but once SFHs start falling, it goes like this.

#56 Topsy-Turvy on 09.24.12 at 10:57 pm

If reality hurts, you don’t spend enough time there.

#57 John on 09.24.12 at 10:58 pm

Freedom First wrote:

“I am a very sick individual as I really enjoyed this blog today Garth. Thanks, and I don’t know how many people in Canada are able to enjoy the humor in your article today Garth, but I was in stitches:)…….and I can’t say I feel bad about it either…..sorry….”
——–

Yeah but you think the “external economy” “rattled real estate”. That’s not what’s happening. The external economy and Canadian real estate are one.

That’s the message.

You don’t understand what’s going on. You’re creating a line where none exists, and believing in cause, effect and remedy that also doesn’t exist.

Try again. You’re a follower. Fail.

#58 Fence Sitter on 09.24.12 at 11:06 pm

Garth,
What numbers are you talking about for this 45% drop in new home sales? Could there be 45% less property available. You’re doing what you accuse the real estate industry of doing.. giving half the facts.

The drop is closer to 70 per cent, not 45. And inventory is up. Ever heard of Google? — Garth

#59 Fritz on 09.24.12 at 11:12 pm

Large drops here in Victoria.

Anecdotes:

1. House on Prospect Lake I used to play in – assessed price 863k – listed at 750k – sold in 3 days, so they priced it right.

2. House on Langford Lake started at 850k in the spring now at 650k. Assessed at 565k so list price still too high, and they are the typical folks following the curve down, rather than leading as in 1 above.

3. Other local houses dropping prices, including one that sat for 2 years at 1.250M now dropped to 995k, others slowly dropping prices, 899 to 859 being a typical move.

I attended the municipal tax sale this morning to start learning about this. One guy dropped 25k on 3 properties. I don’t know how to find out about the mortgages and/or liens held against the properties so I just sat and watched.

Things are not as rosy as the banks/mortgage brokers/politicians or that genius ‘Tsur Sommerville – Real Estate shill’ want us to think. This may be the Great Depression revisited. Global forces are at play.

Thanks for your steadfast honesty Garth!

#60 ozy - hold the champain on 09.24.12 at 11:13 pm

Hold the champain baby, 70% reduction in price is still not here. sales up, sales down, seasonal, etc, or no suckers left in the pipe, plain/boat loads of 70000 non-canadians arriving every semester, cash-strapped many, poor even more, remmeber the song:
I love the way U move the champain glass
Id’ like to —– — —- — —– —.
So these prices, they should down 70% and then we talk, until then, talk is cheap. Hold the champain, don’t waste it for nothing, it’s expensive.

#61 Toronto_CA on 09.24.12 at 11:15 pm

“#54 Regan on 09.24.12 at 10:47 pm
Yeah, sales are down. But it’s August, sales are always down.”

Did you miss the notice that the huge drop is compared to AUGUST 2011, not compared to July 2012? Although it is frustrating as you point out that the government is keeping rates low to stop those who took on debt from drowning while punishing us savers (Garth rightly points out that we shouldn’t keep our money in savings accounts anyway).

Watchdog – I hope you’re right!

#62 nonplused on 09.24.12 at 11:28 pm

Did get liquid Garth, but that was before Lehman even. I believe one should panic early and avoid the rush.

Seems the panic isn’t over though. QE 3 (“QEnfinity” or “QE infinity” some are calling it) is, according to some, all about sweeping “robosigning” and fraud on a large scale under the rug and getting the assets off the bank books. Desperate times, desperate measures. Unfortunately this one can’t be “sterilized” because it’s actually new money being printed to buy crappy assets of questionable value. I guess Fannie and Fredie are the biggest beneficiaries but it’s designed to wipe clean the whole mortgage mess without due process. And I think it’s dollar negative.

#63 popados on 09.24.12 at 11:36 pm

i wish you had this pathetic blog 28 years ago,now i know how SACriFICIAL i must of looked.thanks for remindig me .

#64 TNT on 09.24.12 at 11:36 pm

Nothing a little lipstick can’t fix.

#65 Pooched | The Retiring Boomer™ on 09.24.12 at 11:42 pm

[…] As published in The Greater Fool […]

#66 Mr Buyer on 09.24.12 at 11:42 pm

#18 Smoking Man on 09.24.12 at 9:45 pm
Garth,

Soon the Matchine will put out news to the contrary and the idiotes on track six will buy the GTA right back into record territory.

They have this all mapped out, since 1901. Listen to me and I’ll make you ritch, and I can drink you under the table.
…………………………………………………….
Smoking man your persona reminds a bit of a character in a movie (I think its the classic canonball run) that climbed into he car to start the race and promptly reached up and grabbed the rear view mirror and ripped it off and threw over his shoulder into the back seat while saying “what is behind me I do not care.” Have at her crash…I will stand on platform 5 cheering you on and wishing I was not such an average guy. An ode to the persona that is Smoking man…
!!!!!!!!!!!!!!!!!!!!!!
For he to-day that sheds his blood with me
Shall be my brother; be he ne’er so vile,
This day shall gentle his condition;
And gentlemen in England now-a-bed
Shall think themselves accurs’d they were not here,
And hold their manhoods cheap whiles any speaks
That fought with us upon Saint Crispin’s day.
!!!!!!!!!!!!!!!!!!!
continue your good fight Smoking man the persona that is the lone wolf sage on the stage as I the epitome of tepid mashed potatoes look on in amazement through the looking glass. BTW, I am really really starting to suspect you are indeed an RE salesman if not in fact then certainly at heart.

#67 Mithan on 09.24.12 at 11:48 pm

Regina is still kicking ass and will be for a while yet. Still, glad I got out in June.

#68 Mr Buyer on 09.24.12 at 11:50 pm

#60 ozy – hold the champain on 09.24.12 at 11:13 pm
Hold the champain baby, 70% reduction in price is still not here. sales up, sales down, seasonal, etc, or no suckers left in the pipe, plain/boat loads of 70000 non-canadians arriving every semester, cash-strapped many, poor even more, remmeber the song:
I love the way U move the champain glass
Id’ like to —– — —- — —– —.
So these prices, they should down 70% and then we talk, until then, talk is cheap. Hold the champain, don’t waste it for nothing, it’s expensive.
…………………………………………………….
I do not think Champagne is in order but rather morphine and not the pansy oral form. This promises to be a painfully grinding multi-decade process that will was away even the charred remains of the roaring 2000s. Hold on a minute (or decade )that is one of many strategies alright. While in the heat of the run up I was absolutely bewildered by simultaneously baseless and massive jacking up of real estate prices over the past 10 to 15 years but now that the opening act of the beginning of the end is here I do not know how I could ever doubt how this would end up.

#69 YYC_time on 09.24.12 at 11:53 pm

You got liquid when I told you, right?

I did. In 2008.
Good things come to those who wait.

#70 Robert on 09.24.12 at 11:55 pm

There is little doubt that the RE market in Canada is a leading economic indicator of where our economy is headed. With all of Europe in a severe recession and a bankrupt USA how can anyone possibly think that Canada is not going to skip a beat and it will be growth as usual. I must say a 70% decrease in sales is alarming and this could easily be the catalyst that causes panic rather than a quiet price correction. I am beginning to think that Garth was too conservative in his estimates for a downside move. This move could be very deep and very fast. Canada will not consider action designed to slow the decrease this time around so watch prices blow through their moving averages very quickly.
Realtors and Mortgage Brokers are already feeling the recession and once Building comes to a standstill just watch what happens to our unemployment rate. I am a Boomer and I am liquid but I get no joy from these numbers today as many many hard working families are going to feel the pain and stress of financial ruin. Protecting the family unit is difficult enough in today’s society and this will just add more pressure as families lose their homes and in many cases face bankruptcy. I would love to hear Sommervilles and the guru from the Credit Unions take on these numbers.. LOL I can hear the bunk now with the old seasonal excuse..

#71 DON on 09.25.12 at 12:06 am

Was recently visiting Qualicum Beach Vancouver Island, BC (Retirement ville since the mid to late 90’s. Family friend told me that her eight nearest neighbors were all widows, of various ages 55+. Reduce prices everywhere even though this is a town built for retirement etc. Sooner or later the widows will sell and most likely move closer to relatives, or downsize. Not very many high paying jobs in the area. There are some but not enough to replace the slow decrease in population. 30 years ago, hardly anyone was living in this town. Retirees are definitely there for a good time, not a long time. Lot’s of soon to be empty houses on the market it’s a matter of time, not if.

My siblings are waiting. Big brother got to them first.

#72 TED23 on 09.25.12 at 12:17 am

#20 Realtor #1

It’s called: “I don’t need a realtor, I’ve done this before.”

If no Realtor is needed why does link offer the use of the MLS for $299. This service I might add is owned and operated by…. wait for it……..REALTORS!!!!!!!!!!!!!!!!!!
Seems to me all roads lead Back to Realtor services one way or the other. Clearly these want to be operators cant exist without tapping into Realtor resources. Whereas Realtors have no need to use This Guy or that Guy or any other GUY. Suck it up

#73 Vangrrl on 09.25.12 at 12:20 am

Between the pic and “If this were a Sudbury lap dance, we just lost the parka and boots”, I’m practically on the floor laughing…!!

#74 THE CELIAC HUSBAND on 09.25.12 at 12:23 am

Got liquid.
Now eating French Bistro food at Earl’s prices.

http://theceliachusband.blogspot.fr/2012/04/so-spring-brocante-market-is-on-in.html

#75 T.C. on 09.25.12 at 12:34 am

Fritz @ 59

That would have been the Tax Sale in Langford? The man in the blue shirt?

Mortgages don’t matter with Tax Sales. And you can always do a title search for anything else, although I doubt they mean anything for Tax Sale purposes. You can always read the act to find out.

#76 Kilby on 09.25.12 at 12:41 am

Liquid, renting (for now) and happy we sold 19 months ago. Very well written piece today. It is odd how economists and other “professionals” have such a narrow field of vision even as events unfold before them.

#77 Van guy on 09.25.12 at 12:47 am

Let’s visit Richmond and the “tony west side”

6619 Steveston hwy sold after 125 DOM $775,000
Assessed at $911,000

5420 warbler ave sold $753,000
Assessed $837,200

9831 Gilhurst cr sold 1,838,000
Assessed 1,984,000

10651 No 4 rd original price $828,000. Sold after 130 DOM $675,000
Assessed $784,3000

1 year ago this would not have been seen. Now it’s a trend.
Most Richmond homes are going for below assessment. Almost 1200 sfh and 43 sold so far this month.

Van west is doing much better than Richmond. Total listings 1083, sold so far 47 :)

Van west

2681 McBain ave list $1,995,000 reduced to $1,599,000. Sold after 102 DOM for $1,525,000
Assessed $2,234,300

1996 Sasamat st list $3,390,000 reduced $2,999,000 sold $2,511,500
Assessed $3,127,000

4463 w 16 ave lit $1,198,000 sold $1,150,000
Assessed $1,434,000

716 w 49 ave sold $1,400,000
Assessed $1,500,000

2288 w 45 ave sold $1,410,000
Assessed $1,605,000

Here’s a comparison from now and early this year,

2345 W14th is a 50×125 that sold for $1.8M. Assessed at $1.948M.

Some comparables:

2546 W13. 50×125. Sold for $2.02M in January 30 2012

2344 W8th. 50×115. Sold for $1.850M in May 2 2012

2565 W15th. 50×125. Sold for $1.975M in January 31, 2012

2545 W13. 50 x 125. Across the street for those that care. Sold for $1.99M in Mar 26, 2012.

And another west side disaster,

2716 W18th. 43*122. Asking $1.828M and sold for $1.588M. Assessed at $1.950M.

Last few sales in Arbutus with 40 – 45 foot lots:

3018 W20th. 42 x 122. Sold for $1.933M. April 18th 2012

2917 W20th. 42 x 122. Sold for $1.9M. February 29 2012

2727 W29th. 40 x 130. Sold for $2.018M. February 15 2012

Should I keep goin? I think blog dogs know that Vancouver is screwed. All westerly areas are completely flooded and this will eventually spread eastward and devastate the region with this massive explosion of the real estate bubble.

#78 Dave on 09.25.12 at 12:54 am

Yes I got liquid.
I fear for those that didn’t.
A friend of mine who I told to sell last year is taking her condo in Toronto off the market after it not selling in several months. She seems to think the market will be better in the spring. I think she’s dreaming.

#79 Freedom First on 09.25.12 at 12:56 am

#57

Huh?

#80 Mic D'angelo on 09.25.12 at 12:58 am

People do not want to accept that the 16 year real estate ride up is over and the next ride is down and not a short term ride but at least the next 7-10 years of a torturous slow drop so renting will be the best deal until 2019-2022.Kevin O’leary said on CFRB 1010 last week that it will be a decade of real estate as the worse investment so renting is better as he does not see one recouping 10-15% closing costs buying a house or condo in Canada. He has been right about bonds the last decade saying it would be a good place to be.

#81 Confused on 09.25.12 at 1:03 am

I think u guys are just to poor to buy a house all u people are jelous of people like me with a big house. Stop crying and go get a job! Ill see you as I drive by the bus stop in my bmw!!

#82 TRT on 09.25.12 at 1:11 am

Boomers cannibalizing the young:

http://www.theglobeandmail.com/report-on-business/economy/jobs/two-tier-wage-scales-on-the-increase-in-canada/article4564862/

A guy who works for Ford say it is a “satisfactory” deal..

Once one domino falls, others are likely to fall.

Unions: Get ready for two-tier wages. Young are screwed. The veterans who vote for this are going to be screwed (but they don’t know it yet) come 10 years (their pensions will be unsustainable).

Private Sector: get ready for the “Skilled Worker Immigrant Stream”. Can hire for any job and pay 15% less initially. End result: You pay WILL GO DOWN.

The sheep are too brainwashed to realize this …so it will happen. Plan accordingly ;)

#83 Nostradamus Le Mad Vlad on 09.25.12 at 1:16 am


“Why should anyone buy right now? The next few months will give all the evidence you need. Suddenly economists look like shills. If this were a Sudbury lap dance, we just lost the parka and boots.” — Never been to Sudbury before. What country is it in?

As for the Bob and Doug McKenzie comedians the other night, it’s best left unspoken. Reality bites hard.
*
#174 Smoking Man on 09.24.12 at 8:46 pm — “For those of us who take risks, sometimes we don’t live that long, but if you don’t take risks, you don’t live.”

It would be an unbelievably boring life if we didn’t take chances, gamble on a few things (not lottery tickets) and generally try to improve ourselves from what we were yesterday.

Living in a comfort zone is awful, worse than being a sheeple. Yuck! I don’t want my life to deteriorate like that!
*
Food Prices High this year? Wait ’til next year. Aren’t the mtge. resets underway now? Plus Russia Halting grain shipments? Enslaved by banxters and we let them do it to us, by not doing anything ourselves; Walmart, like Monsanto has started destroying India; Debt Slaves All debt slaves will soon be employees of the feds.; Globall fiscal system is about to apply full reverse thrust; John Mauldin Has the US Fed git it wrong? Rich State, Poor State Top five of each; Garth, it appears the Euro crisis has not been contained. Sorry; 4:25 clip History of Bernanke’s QE failures; Ireland Debt collectors in demand.

Bernanke (and Carney) ready to blow up Canada, and QE3 expanding next year? Retire early? Fuggedaboudid; Caterpillar Forecast for 2015 cut; Blankfein has spoken; Germany Bad business mood, and Daimler Cutting production; Walmart Taking over the world one country at a time; The Oracle of Ontario He didn’t do very much, that’s fer sure; Billionaires selling stocks. There is a reason for it, obviously and Bank Fees soar Wonder if there’s a connection there? Own brand labels taste just as good as name brands.
*
Smart Meter Proof Spying on us; Info. on solar power plants; Ummm, there may be something else to be concerned about, Gap Widening between US and Israel? And 32:14 clip DHS preparing for civil war? It would explain all their large ammo purchases over the past few weeks, and Roads to WW3 and Civil War could begin with a FF in Chicago; Unintended Consequences, The Law of; ObombaCare The Hidden Agenda. He’s a commie — whaddaya expect? Uninvited Guests Avoid jungles; Yetis spotted Actually, it was BPOE, Mikey the Realtor and a few others hunting for new jobs; A cross between a poodle and a sheeple Nick Clegg; China – Japan Add Taiwan into the mix, and Widening Rift; Rainman? Not quite; Walking on Water with a little assistance; Is anyone there? That’s another fine mess you’ve got me into; Food Fight!

#84 CoreyMc in Calgary on 09.25.12 at 1:23 am

#46 squidly77 on 09.24.12 at 10:23 pm
It’s your friends, family and co-workers who are getting thumped. Don’t gloat.

_____________________________________________

For how much I had to hear about housing being the best investment from smug homeowners that didn’t have any skin in the game…. GO ON GLOAT!!! YOU DESERVE IT!!

#85 Morry on 09.25.12 at 1:34 am

It’s only when/if you sell … stay the course. it’s all cyclical

#86 Geogar on 09.25.12 at 2:45 am

Multi-generational households on the rise. CAW contract agreements(non-spectacular). Gyproc price drop. The writing is on the wall. The Greater Fool just can’t see the writing on the wall.

#87 Finally on 09.25.12 at 3:07 am

Gangnam Style it Garth!

#88 Buy? Curious? on 09.25.12 at 3:07 am

Garth, with housing coming to a standstill, will that mean unemployment will mushroom? I know our economy is dependent on an ever growing housing market, but what else is out there when construction workers, real estate agents and home decorators all start losing their jobs? What kind of job skills do they have that will be transferable?

http://www.youtube.com/watch?v=Ey4WX-mUOZA

#89 B P O E -----$-$ No more $$ on 09.25.12 at 3:10 am

Thats right folks Worst August numbers EVER, price slides are gaining momentum, word at parties is the bubble has popped, lots of people crossing their fingers hoping it isnt true, the smart ones are listing below accessed value and getting out ahead of the mad rush to the exits, people who bought condos in Vancouver over the past 5years have seen no increases in property value, many underwater. Trustees are lined up with folks in debt. The angels in the wings have turned into bats and are now blind trying to escape holding property. Another 20-25 % further to fall then flatline for a few years. Silly landlords are now subsidizing rockstar renters, why buy a $450k condo for $2800 month when you can rent for $1600 and be free of the falling axe.

Thats right folks the tide is going out and won’t be back for several years, catch the wave out or be embarassed standing naked on the debt train.

Two years later and the haunted Olympic Village still only 75% sold out even after a 30% haircut by Rennie, watch for another haircut coming soon to a realturd near you:]

#90 SCIB on 09.25.12 at 4:03 am

QE3 and artificially low interest rates are part of the largest theft of personal property since the beginning of time. Senior citizens are the weakest and most abused in this process as they have the most savings that is shrinking through negative real interest rates.
I used to be proud to be a Canadian. Now I am ashamed.

#91 Nathan on 09.25.12 at 4:45 am

For what it’s worth here are two anecdotes from my work in the building materials industry in Ontario (residential and commercial — framing products, lumber, exterior claddings, mouldings, etc).

First, our revenues are tracking closely with last year’s, which were up on the year prior. Second, some of the retailers have provided financing to developers for projects that aren’t selling in order to keep them (and their sales) going.

There’s a lot of highly leveraged parties in this business who, presumably, have taken positions on the assumption that the growth of the last few years will continue.

#92 GTA Girl on 09.25.12 at 4:51 am

TO Mayor’s junket to Chicago was filled with BILD members, the Land Development lobbyists and a few construction figureheads.

He claims the trip cost the taxpayer nothing. Which makes one wonder if ‘they’ paid.

A truly stupid move when Montreal is loudly investigating their ties to the construction business and Donnie Brasco elements.

And going to Chicago to boot?

The Mayor may be dumber than a sack of hammers

#93 Vernie on 09.25.12 at 5:08 am

“You got liquid when I told you, right?”

Yes we did, we sold our paid-for house in Kingston Ont after a tense six weeks on the market in late spring.

Moved to Ottawa and decided to rent as prices here in Ottawa were just too high for a SFH.

The proceeds are invested and we are happy renters.

Thanks Garth.

#94 45north on 09.25.12 at 5:44 am

Not 1st: So Regina is safe then?

no it isn’t, Federal Government cut backs are hitting Saskatchewan too

up-to-now the Toronto market has been strong, psychologically Regina follows Toronto, it’s the internet thing

Fritz: This may be the Great Depression revisited. Global forces are at play.

Randman posted the link “Economic war declared on Canada” it’s what I was thinking about when I posted the link about Montgomery County PA.

#95 John on 09.25.12 at 5:48 am

Nonplused wrote:

Did get liquid Garth, but that was before Lehman even. I believe one should panic early and avoid the rush.

“Seems the panic isn’t over though. QE 3 (“QEnfinity” or “QE infinity” some are calling it) is, according to some, all about sweeping “robosigning” and fraud on a large scale under the rug and getting the assets off the bank books. Desperate times, desperate measures. Unfortunately this one can’t be “sterilized” because it’s actually new money being printed to buy crappy assets of questionable value. I guess Fannie and Fredie are the biggest beneficiaries but it’s designed to wipe clean the whole mortgage mess without due process. And I think it’s dollar negative.”
———–

Great. But I don’t get it. Why do you think
“being liquid” is safe in this situation? Do you believe in cold fusion?

One of the hallmarks of this blog is poor solutions built on really bad risk assessment.
And bad investment advice.

You seem to understand the risk…but think you have “money” by being liquid.

I’m seriously lost. What’s your logic?

#96 SpongeBob on 09.25.12 at 5:55 am

Great post. Try to talk more about Montreal. It s ridiculous price over here. As you said previously sellers are in denial that sales are drying up quickly.

I did the exercise of counting all houses and condos in some areas (via realtor) and I was astonished to see the number.

The funny part is you see some seller with pictures dated back from last winter (snow) and there are still not lowering there price.

#97 Mac1988 on 09.25.12 at 5:57 am

Lap dance crack had me spitting my tea out,classic.

#98 maxx on 09.25.12 at 6:44 am

“…it would take some kind of external disaster, “a major economic recession, a downturn, or perhaps a financial crisis, a political crisis,” to rattle real estate?”

So many economists are astoundingly stupid. These conditions have been with us on steroids since ’07 with a run-up of about 25-30 years. Do these bozos really believe the tripe they’re spewing or do they think that the general population hasn’t a clue?

These greatest fools of all haven’t got a formula, app or insight that will bring “escape velocity” to the economy, nor circumvent, obviate, transform or flip current conditions to betterment.

The piper is senile and drooling, avoid RE like the plague.

#99 Aussie Roy on 09.25.12 at 7:05 am

Aussie Headlines

How to sell a house no one wants

http://www.news.com.au/realestate/investing/how-to-sell-a-house-no-one-wants/story-fndbarft-1226480186539

Secrecy clouds state of Aussie housing market

http://www.theage.com.au/business/secrecy-clouds-state-of-market-20120923-26ez9.html

FOR the owners of units in 52 Regent Street, Chippendale, the nightmare began soon after they moved in, in 2004.

I am an architect and whoever built this building was a moron.

Most had bought off the plan

http://smh.domain.com.au/nightmare-on-regent-street–and-builders-done-a-runner-20120923-26f3y.html

#100 F5 Sycophant on 09.25.12 at 7:36 am

The MSM is not reporting this alleged ‘70% plunge in new home sales in Toronto’.

Oh no? — Garth

#101 House Horny Housewife on 09.25.12 at 7:37 am

Oh Garth,

There you go confusing home buying with financial investing and assets within a market economy.

Most people who are looking for a home are not looking at the “dirty financial part” … at least not until they fall in love with a house and have to face that “unpleasant” reality.

I honestly do not think that it is the effect of prices in people’s minds that is keeping them from buying a home (or selling it). I think it is simply that they have hit a wall. A huge solid wall that comes with being overextended for many many many years. I think the recent banking restrictions have helped in slowing real estate sales but this is for the best and do not go far enough (too little too late).

I think that people would continue to overextend themselves in the most dire of circumstances in order to have that “perfect” house. A house is not just a house in people’s minds. In their minds it represents a way of life, in addition to being a status symbol, a source of security and a way for them to have the freedom and privacy that they feel they deserve. Most people will do anything to have this. Owning their own home will always win out in the minds of most people, over renting one. It is irrational, emotional and an idea that is extremely difficult to change.

The only way to skew the situation towards renting as being seen to be more favorable to buying is either: 1. to force people who cannot afford to buy to rent (thereby forcing people to see the financial aspect) .. and this is were the recent banking rules come into play or 2. to create a vision of renting that is more attractive than HGTV .. like say an “RHN” (Renters’ Home Network) which shows the possibilities available for people who choose to rent instead of buy.

I did notice recently that there is a show about this very subject, where the host(ess) helps renters to find the perfect apartment and then helps them to fix it up to suit their needs at a reasonable cost. It’s about damned well time !

Unfortunately, a large part of the population lacks vision and most people are ready to lap up anything they see others do or what’s on TV. Of course, appearances are always extremely deceiving. However, most people still think that having that perfect place will make their marriages work better and earn the respect of their children. Oh, if only they can have that perfect open concept living space, they will earn the envy and respect of their friends and family when they entertain. They will finally be happy and content in their lives.

You may laugh at this but this is indeed how most people think and they will do almost anything to get it. Go into debt forever, if that’s what it takes. The fact that their dream home is beyond their means is not important and organizing their finances so that they can have it is just a formality. Especially in this day and age when there is a financial institution around every corner vying for new business. If you live and breathe, they want you as their valued client.

Don’t you all know the story of Faustus ? Well it happens to be based on reality. Just place the average person in the main role and the bank in the role of … well … you know. The agent is just the facilitator .. so I guess you can call them the devil’s apprentice or something (a new role for the 21st century version of the piece).

Hey, what a fabulous idea for a play ! … or a university thesis perhaps. Faust or Fiction ?: Postmodern Reflections on the Changing Perception of Debt and Commodity Value in Contemporary Times. Ha ha. Obviously the glue from these packing boxes is finally getting to me.

HHHW

#102 Bigrider on 09.25.12 at 7:55 am

#92 GTA Girl.

Lets face it. Toronto IS construction. The rest of the world looks in and sees a micro economy wholely distorted by construction and related businesses/industry around it.

How much of our GDP is housing related now (rhetorical)?

The amount of cement, dump and transport trucks on our roads says it all.

I would be surprised to find any politician NOT in bed with construction heads.

The sickening obsession with anything RE related in this city is coming to climax. The hangover will be long and severe.

#103 NYCer on 09.25.12 at 8:06 am

Garth, I signed up for the Toronto event and got an email response. Is it sufficient to show up with ID and the printed email?

Thanks,

Be prepared for a quick blood test. – Garth

#104 Smoking Man on 09.25.12 at 8:27 am

#66 Mr buyer

A realter. Please

Just a little old track 5er a few chess moves ahead of the pac.

So condo sales have crashed 75 precent. So they should they are a rip off.

Now that very few will be rolling up to the average price, the average price wil be pushed up huge by not having condo sales bring it down.

So at oct new realease by toronto re board will show strong prices.

Inspite of the daily gloom and doom on re eastate the ownes will see that number and say screw it I’m not selling.

My oldest son is getting hitched in june what a fantastic wedding gift a nice crash would be.

A Realtor. What an insult to my intelect

#105 GregW, Oakville on 09.25.12 at 8:35 am

Hi #83 Nostra, Just wondering if you have seen this yet?
(BTW, thanks for the links, in case I can’t tell you later)

“12 September 2012 – 10:52am
Right now, a group of 600 lobbyist “advisors” and un-elected trade representatives are meeting behind closed doors to create new penalties for Internet use that conflicts with vested interests. Instead of debating this openly, they’re meeting secretly to craft new Internet restrictions (including fines for Internet users) through an international agreement called the Trans-Pacific Partnership (TPP).”…
http://www.greenparty.ca/newsletter-articles/2012-09-12/openmedia-stop-trap

#106 Realtor #1 on 09.25.12 at 8:46 am

It sounds like people who post/read this blog are people who want to buy a property in the near future (when they can afford it).
You guys don’t hate RE you love it thats why you come back night after night.

#50 Toronto_CA
“Detached SFH will be the last to melt” Nope -Watchdog
# 61 Toronto_CA – Watchdog – I hope you’re right!

The irony of waiting for RE to crash but it is obvious that he/she is planning on investing in it.

#72 TED
We created MLS.ca – no one is stopping someone from making their own.

#107 Burnaby Renter on 09.25.12 at 8:46 am

Got liquid. Stayed liquid. Thank you Garth.

#108 Inglorious Investor on 09.25.12 at 8:50 am

As per Canadian Watchdog’s comment @ #12:

Putting aside the validity of the poll itself, I’ve said before that I believe strategic bankruptcy will become an increasingly common component of many Canadians’ financial ‘plans.’

#109 In Garth Almight not God we Trust on 09.25.12 at 8:58 am

“Says housing analyst Mark Hanson: “I have never seen this type of demand destruction anywhere before. Not even in the US.”

Well had Mark been heeding the words of the bearded mystic oracle, all knowing, all wise, soothsayer without equal, crystal ball gazing reader of financial tea leaves, former MINISTER OF NATIONAL REVENUE, denouncer of parliamentarian peckerheads and peckerettes, Harley riding badass contrarian, NYT bestselling author, charismatic speaker to packed auditoriums, lone voice of reason crying out in the HELOC infested wasteland of Canada and last but not least, all round jolly good fellow, he would not be scratching his head in wonder at the collapse of Canadian real estate. Captain Garth predicted this mother of all real estate meltdowns over 4 blinkin years ago!

#110 Jeff - from Moose Jaw on 09.25.12 at 8:59 am

Hey,

Garth, just wanted to say thank you for the great advice.
I’m a regular reader of your blog.
Today is an important day, which is why this is an important first post for me. (I just read the comments).
You see 2.5 years ago between my wife and I, we had over $50,000 in debt.
September 25th 2012 it is officially $0.00
So, yes – we got liquid when you told us! Thank you!
(Oh and yeah we rent an apartment, part of that debt came from housing).

#111 John on 09.25.12 at 9:02 am

HHHW wrote:

“Most people who are looking for a home are not looking at the “dirty financial part” … at least not until they fall in love with a house and have to face that “unpleasant” reality.”
——

This is not a “people” perspective, it’s a feminine perspective. Which is really fine. If you scratch the surface a bit further, you’ll see the whole real estate market scam took flight with this “people” thing. Dehumanized.

Want to see denial? Fly that reality past just about any Canadian. You’ll get some predictable reactions.

1. You’re a “bigot” or “sexist”.
2. Guys jumping to “Mom’s” defence and denyin their reality.
3. The silent brow-beaten Canadian male sheep following bankers, politicians, wives and mothers as their “decision-makers”.

HHHW…your perspective is legit. But men don’t think like women. At all. The “runaway train” of debt has been largely due to poor judgment and direction. Good judgment and direction is the masculine pole of humanity. Think some of the more exaggerated roles in the movies.

Would Russel Crowe be looking for his “dream house” nest in “Gladiator”? Never. His wife is adding this essential part. Naturally both genders have capacity for everything..of course.

But the uni-sex deal of “people” and how they see real estate?

Fail.

#112 disciple on 09.25.12 at 9:04 am

Yes, thanks, Garth, I did get liquid. You’re the best…

Nobody does it better
Makes me feel sad for the rest
Nobody does it half as good as you
Baby, you’re the best

And nobody does it better
Though sometimes I wish someone could
Nobody does it quite the way you do
Why’d you have to be so good?

#113 disciple on 09.25.12 at 9:07 am

We found Roman Polanski where he should not be! Y’all gonna love this one because you’ll finally see how Sharon Tate is still alive and what Manson has been up to… check out my blog…

#114 Inglorious Investor on 09.25.12 at 9:12 am

#91 Nathan on 09.25.12 at 4:45 am

Vendor financing can be good for vendors when demand is high and cash flows are healthy. Self defeating (and a bad sign) when used to prop up lagging demand (which is what you seem to be saying). For the ultimate vendor financing folly, see Cisco, Lucent and Nortel in the late ’90s.

#115 disciple on 09.25.12 at 9:12 am

Hey GTA girl: the sign in front of the 2 mil home on 165 Stegman’s Mill has been taken down… wonder if they had any bites… now that would be a good rental…

#116 refinow on 09.25.12 at 9:25 am

As hundreds of “Not-In My-Backyardigans” finally pull their heads out of the sand, they wait for their eyes to adjust to the blinding reality that things are not really any better here..

Garth, they can’t say you didn’t warn them…

#117 Keith in Calgary on 09.25.12 at 9:27 am

Been liquid since 2003.

Saw the sh*t show unfolding, just as it is today, starting right after 9/11 with regards to the money printing and the rate dropping antics of global governments. Best forward looking forecast I have ever made, and it made up for all my average to bad financial judgement calls of the previous 30 years.

Present status…..well….swimming in it……mang, I feel like Tony Montana some days.

North American financial markets are a criminal fraud and are on life support thanks to Bernanke. The DOW would be at 4,000 – 5,000 today if it wasn’t for him and his bankster buddies who have robbed Joe the plumber.

IMHO it is time for a Nuremburg trial for financial crimes gainst humanity.

#118 Toronto_CA on 09.25.12 at 9:30 am

I hope the Toronto Star or the Globe and Fail pick this story up today, or I will lose faith that the Real Estate cartels don’t own those two papers. It’s sort of a big deal, no?

#119 Inglorious Investor on 09.25.12 at 9:32 am

Many months back I said that retired or almost retired average Canadian homeowners in Van or TO who wanted to live out their remaining years in some sunny southern state like Florida, Arizona or California were given the arbitrage opportunity of a lifetime.

If you were/are in that position, potentially glorious, golden years were handed to you on a silver platter. You could sell your overpriced property here and buy an undervalued, but comparable property there. Invest the cash profits (which could easily be in the hundreds of thousands of dollars) in liquid, income producing assets and live large until death you do part.

Making the deal so much sweeter is that the dollar is at par, and you have a greater chance of buying a property that will appreciate in value while you spend your days gathering more wrinkles at the beach.

Man, if I was in a position to retire, I would have been getting very cozy with my account, lawyer and real estate agent months and months ago.

#120 Grantmi on 09.25.12 at 9:38 am

#85 Morry on 09.25.12 at 1:34 am

It’s only when/if you sell … stay the course. it’s all cyclical

Sure… Tell that to all 40 – 45% USA home owners under water on their homes, and can’t sell or move for a better job because of the nut they have to come up with.

Come on Morry… U can do better then that.

#121 House Horny Housewife on 09.25.12 at 9:39 am

#105

Hey John,

What kind of 1950’s sexist rock did you just crawl out of ? Holy smokes I didn’t think guys like you still existed ! You have some serious personal issues to work out my friend. Comments like yours really scare me.

Of course I couldn’t disagree with you more. You are so overgeneralizing based undoubtedly upon your own unfortunate personal experience with women (get help .. not all of us are like that, honestly).

I am not sure but I think you may have just challenged my husband’s masculinity because in our marriage, he is the one to buy with emotion and I am the one who looks more at the practical aspects and puts on the brakes.

Please, take it easy on the woman bashing, will you ?

HHHW

#122 Realtors in an all out PANIC! on 09.25.12 at 9:46 am

Realtor Smokingman posting in an all out PANIC! This guy is your average realtor who can not read or write and is proud to be uneducated . Look at the fear in his post when garth posts FACTS and NUMBERS realtors don’t want you to know. It’s going to be a NASTY housing crash smokingman a NASTY crash!

#123 Bottoms_Up on 09.25.12 at 9:52 am

Does anyone think it a coincidence that the feds waited until 2012 to make the rules tougher? They had to allow the 2006 and 2007 40/0’s renew (above water) first!

#124 Realtors in an all out PANIC! on 09.25.12 at 9:58 am

Bigrider on 09.25.12 at 7:55 am
#92 GTA Girl.

Lets face it. Toronto IS construction. The rest of the world looks in and sees a micro economy wholely distorted by construction and related businesses/industry around it.

How much of our GDP is housing related now (rhetorical)?

The amount of cement, dump and transport trucks on our roads says it all
—————————————————————–
It is crazy how many people are in this house of cards industry. You drive around the city and that’s all you see . Look at this blog where you have alot of scared out of work realtors posting on garth’s blog and one must ask why? Realtors are not here because sales are going well. Realtors are seeing first hand the ponzi scheme is crashing down.

#125 Ronaldo on 09.25.12 at 10:04 am

http://www.tmxmoney.com/en/cpnews/SUF201.html

Some things never change. Spend, spend, spend.

#126 Junius on 09.25.12 at 10:07 am

#106 Realtor #1,

You said, “You guys don’t hate RE you love it which is why you come back night after night.”

This is the common misconception that all Realtors and Re industry types have when they come to this blog. They quickly surmise that everyone are jealous renters living in soggy basement units waiting to spring into the market after a crash. This opinion is the myopic view of someone who spends there life in that industry.

Most people here are owners and I have never seen anyone say they hate real estate. We all need a place to live. That is not the point.

I can’t speak for everyone but I think in most cases the anger is directed at policy makers who created a credit bubble and their co-conspirators in the finance and banking industry. That Canadians can’t see the coming crash after it had played out in Europe, the US and other places is both amusing and frustrating.

There is anger at the duplicity of the Re industry and its cadre of brain dead economists who demonstrate daily the wisdom of Sinclair Uptons classic statement that it is hard to convince someone of something when their job depends on believing something else.

As for realtors, their smugness and lack of understanding of the big picture is often irritating but more often just a sign of how difficult it is for anyone to be objective.

What drives most of us back day after day is somewhere between the human impulse to watch a car crash or train wreck in motion and a desire to try to make sense of the irrationality of the world around us. The RE industry is the by product of the fundamentals of the economy. It is the by product of the manipulation and not the cause which is why it is fascinating and tragic when the human element is factored in.

You need to peel back a few more layers on the onion to understand what is really going on here.

#127 Gunboat Denier on 09.25.12 at 10:10 am

75 TC 59 Fritz – here is the act

http://www.bclaws.ca/EPLibraries/bclaws_new/document/ID/freeside/96323_15

Part 11

#128 OrangeBull on 09.25.12 at 10:18 am

“In short, no place is safe”, except for Calgary…

#129 Junius on 09.25.12 at 10:19 am

Re: quote,

Sorry, my quote in the previous quote was from Upton Sinclair (dyslexia showing). The exact quote is, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

#130 Smoking Man on 09.25.12 at 10:24 am

Bubble heads 2 things required for home owners to drop there undees.

1 lost jobs. In the news retail sales threw the roof. Us consumer confidance threw the roof. Case shiller us market spike of 1.2.

2 rates need to spike. Anyone see what’s going on in spain and the ECB. Carney is peralized. F hit his traget he crushed condo sales.

With out that a home owner will not allow him self to get be-otched slapped by pimple faced bubble heads low ball offer.

You have but a few months to find a over reacting financial post reader home owner before you are locked out for ever in the 416

Not watch grasshoppers. F and C hit there condo mission. Watch doom and gloom stories in the MSM vanish as fast as the H1N1 feasco did.

#131 Tony on 09.25.12 at 10:31 am

Dammit, I bought a house in TO about 2 years ago before reading this blog….

On another note, does anyone know how to burn down your house without suspicion in order to collect the insurance and leave town?

Thanks!

#132 Smoking Man on 09.25.12 at 10:31 am

Forgot.
Here is a freebe bubble heads if you can’t afford a Bloomberg terminal. This is the next best thing

http://www.finviz.com

#133 Penny Henny on 09.25.12 at 10:37 am

So our ownership rates in Canada are 70%. Big frickin deal.
Rates in the U.S. are a touch under 65% and guess what, there are many who want to buy if they could get approved.
Problem is banks still need to dump the bad mortgages to the Fed before they start issueing anything mortgages to those without gold balls.
70% is not the tipping point.
The sky is not falling.
Penny Henny

I don’t recall writing about the sky. Just a real estate correction which could hurt the unsuspecting and exposed. — Garth

#134 NewWorldPartyDotOrg on 09.25.12 at 10:39 am

Using extremes to make the point: If a house costs $10k to buy but $1,000 to rent, it makes more sense to buy. If it costs $10 million to buy but $1,000 to rent, it makes more sense to rent. There are numerous calculators on the internet that shows that Canada has well passed the point where it makes more sense to rent.

A house is supposed to be a consumable, like a car or TV, not a tool for speculation.

Bubbles, such as the Dot Com, Oil and Real Estate bubbles, are extremely disruptive for any country. They usually make some people filthy rich and some people filthy poor: http://www.newworldparty.org/2011/11/bubbles-extreme-maker-and-breaker-of.html . After the Housing Bubble burst in the 1990’s in Hong Kong, people jumped out of windows. After the stock market bubble burst in 1929, people in New York jumped out of windows. Governments should do everything they can to prevent or suppress bubbles. Instead, the Canadian government did everything it can to create and fuel the Housing Bubble.

The government massively manipulated the housing market at the expense of non-homeowners, taxpayers, first-time buyers and children: http://www.newworldparty.org/2011/04/housing-most-manipulated-market-in.html

Anybody who buys into this Housing Bubble is a sucker and will become much poorer, while the seller will become much richer. Housing Bubbles tend to make the younger generation poorer and the older generation richer.

#135 Tom from Mississauga on 09.25.12 at 10:40 am

So for the cash strapped Ontario government that new home sale drop means about $35 million less HST collection in the GTA market alone for just August. And with 193,000 jobs involved we’re also now in recession. Great!
http://www.nationalpost.com/scripts/Toronto+home+sales+fall+record+August/7291383/story.html

#136 willworkforpickles on 09.25.12 at 10:43 am

When building comes to a halt unemployment rises and so do defaulted mortgage statistics.
Ever rising power of sales will be the catalyst of the panic wave of selling to come in 2013 with a steep decline in house prices following.
Watch rising unemployment lead to disaster in the housing market with the fundamentals being this toxic as never seen before.

#137 cadmar on 09.25.12 at 10:57 am

Like most of your followers, I’ve been reading you for quite a long time. Where do you find all those amazing pictures? In fact, I find your content to be as equal to those pictures.

#138 Steven Rowlandson on 09.25.12 at 10:59 am

Well Garth it looks like the restoration of sanity in the real estate market is on the way. The big drop in sales is merely the start, the real nasty bitch slap is the 90% plus drop in prices that has to happen before things have bottomed out. Banks, boomers and disciples and the government will just have to bow to reality and write off their real estate losses and put what is left of their funds into something more productive and not something that is the financial equivalent of a sodom and gomorrah gang bang. There’s a new expression for you. Speaking of financial gang bangs what about the federal and provincial debt? Perhaps it is time for the RCM to make some one ounce platinum legal tender coins with a one billion dollar face value each and simply pay cash for all the debt paper the governments has issued and then burn the bonds and eliminate the means to create more bonds to sell in the future. No more government debts and no more interest charges.
Can you say new beginning for Canada? I can.

#139 Kilby on 09.25.12 at 10:59 am

#82 TRT on 09.25.12 at 1:11 am
Boomers cannibalizing the young:

http://www.theglobeandmail.com/report-on-business/economy/jobs/two-tier-wage-scales-on-the-increase-in-canada/article4564862/

Should read “Corporations cannibalizing the young”

#140 Tony on 09.25.12 at 11:13 am

Re: #17 TO Reader on 09.24.12 at 9:42 pm

I’m sure the reason is more like the residents of Winnipeg can’t see the forest for the trees. Well let me tell you the trance or brainwashing they’re in is wearing off very fast. The average $250,000 house will be selling for well under $200,000 there next year. Most will try to stave off bankruptcy but alas market forces will prevail and those houses will become bank owned.

#141 Mister Obvious on 09.25.12 at 11:17 am

111 John

“HHHW…your perspective is legit. But men don’t think like women. At all.”
———————

I would agree. Generally speaking, men and women do tend to think differently. But when men make that statement it often comes with the implication that women must therefore be stupid.

Its a mistake to paint all women with the same brush, just as it is with men.

My wife loves houses and all of the things that make them cosy to live in. But she is also quite aware of the current perilous Canadian real estate situation and the burden of huge, pointless debt.

She also reads this blog and has taken Garth’s message to heart. We got out of residential real estate when the getting was good and are quite content to rent until sanity returns. Might take years. It might never even happen for us. That’s OK, we’ve got a life to live.

#142 Marcus on 09.25.12 at 11:17 am

#15 You just hit the nail right on the head. In the next 4-5 years about 50 million baby boomers will hit the retirement wall and need to downsize. Who will they sell their houses to? The 18-24 year old crowd that is at a 50% unemployment rate. They also are mandated under law to start liquidating their IRA’s, 401k’s sep ira’s etc. Who will buy the billions in stock that they must sell? Exactly….the FED. The sound you hear is the toilet being flushed on America…the next sound will be the tanks and planes of a war of distraction so the chess board can be wiped clean.

#143 Not 1st on 09.25.12 at 11:23 am

Garth, its time to give out the greater fool award. I vote for that student who paid $427,000 over asking for a garbage bungalow in Toronto some months back. This had to be the top of the market.

A close second would be the person who bought facebook at $42.

#144 John on 09.25.12 at 11:23 am

“What kind of 1950′s sexist rock did you just crawl out of ? Holy smokes I didn’t think guys like you still existed !”
——
My point of view is humanist, realistic, natural and inclusive. I’d update your comment to “I didn’t think guys existed”. Guess what… they do. But not in your environment or cultural context. As you explained about how you adopted the masculine role…exactly my point.

Nature doesn’t accept vacuums. Also, imagine if the north and south pole wanted equality.

Nonsense. You likely rarely get challenged on the degendered BS you come up with. How could you be?

#145 gladiator on 09.25.12 at 11:30 am

Garth, if I were you, I’d be smiling like that dog now. And keep smiling for about 10 more years.

#146 };-) aka D.A. on 09.25.12 at 11:30 am

One month does not a year make and is certainly no indication of the commencement of a shift. Before you start tooting your own horn let’s see what happens between now and into the traditional spring market.

That being said now that the real estate markets in “The Center of the Universe” (Ontario) are showing signs of slowing and continue doing so you can expect, not long from now, the Feds will soon determine they need to crank it back up again.

When will they ever learn, like bringing a ship into dock, neutral is your friend.

#147 Tkid on 09.25.12 at 11:32 am

So Penny Henny, we should be fine with 70% ownership rate as the States is at 65%? Are you demented? In prime Florida territory one can buy a two bedroom , loft, three bathroom, full kitchen, big living room/dining room, with laundry and garage townho
E for $50,000. $200 a month in maintainance gets you access to a pool and the hut with big screen tv and exercise rooms. I say hut but it is more like a communal mansion. If I had not seen it I would not have believed it.

Here in Canuckistan that will set you back $300,000 plus a grand a month in maintainance.

I wanna be a snowbird when I grow up.

#148 L Patterson on 09.25.12 at 11:36 am

#131Tony on 09.25.12 at 10:31 am

I’ve heard of “friction fires”, which are caused by the mortgage papers rubbing up against the insurance papers.

#149 LIving in AB on 09.25.12 at 11:38 am

I know it was a wrong time to buy realestate but the woman would have it no other way. So she put in most of the 20% downpayment (with a gift from the inlaws who live/ breath RE). Is this wrong? SHould I be feeling bad….cause I kinda dont.

#150 Recondite Richmondite on 09.25.12 at 11:42 am

@NKVD Black Raven

“Eventually 90% of the planet was covered in useless, empty buildings. I wonder where the author got the idea from back in the 70′s?”

–Capitalism

#151 Regan on 09.25.12 at 11:51 am

#61 Toronto_CA – Ah, yes I did miss that. It makes more sense to be alarmed/jubilent in that case. Nonetheless, I don’t put too much emphasis on stats that only go back to ye ancient times of 2009, and I think we won’t know what’s really happening until the Sept. stats come out. Like I said, I have a good sense of what’s going to happen; when is still the big issue.
Two friends of mine just bought houses – little starter homes (as if that concept EVER makes sense) and I keep my mouth shut. Who knows, it’s more space, they feel at home and maybe it’ll be worth it for them. Money is for spending, right? Relating to HHHW’s comment about how people feel about buying – buying and renting a home are different products. Depending on your needs for control, stability, the available housing stock, your financial capacity, your expectations of life and a lot more, it can make sense to choose either. I wish people were more aware of everything their choices entailed. However, I can’t say for certain whether we’ll look back on this decade as a time when money was dirt cheap and we should use it to maximum advantage, or whether it was cheap and we should pay off every debt while we can. For me, the answer relates to my personal risk tolerance with a coating of logic on top. According to John, that’s my ladybrain failing to function, but then again, that’s just his dudebrain being deluded by its superiority complex.

#152 Jimmy on 09.25.12 at 11:54 am

Garth and the Bubblettes never cease to amuse –its like a mutual stroking session in here. Faithfull followers in the cult of Garth reveling in half-truths and biased interpretations. Outside of Vancouver, how are prices doing Garth? Oh, but I can hear you say, “the crash is always preceded by a drop in sales.” Sounds like an overly simplistic and self-serving interpretation of things. Inventory is low, which explains much of the low sales numbers. Properties that are priced right sell quickly. Many people are sitting tight not wanting to move up and take on more debt. Despite your eagerness, the crash is not happening yet. Sorry Bubblettes, you’ll just have to keep hoping and praying.

#153 Frank le Skank on 09.25.12 at 11:57 am

#111 John on 09.25.12 at 9:02 am

Hey John the Douchebag, stop ending your comments with the word “fail”. Garth did that on one of his post and you’ve latched onto it because your lack of imagination and individuality doesn’t allow you to come up with something on your own. You are not Garth, shut up.

Stop nit picking inconsequential parts of a comment and cutting it down for no apparent reason other than to make it appear as though you contribute something worth while to this blog.

GFY John

#154 Investx on 09.25.12 at 12:10 pm

36 Julia:
WTF?
2013 Expected to Heat up Condo market Across Canada, Syndicate Mortgages
http://www.equities.com/news/news-headline-story?dt=2012-09-24&val=511940&d=1&cat=headline

Check the source. — Garth
………………………………………………………….

And this illustrates nicely the importance of citing sources. :)

#155 Canadian Watchdog on 09.25.12 at 12:15 pm

#82 TRT #139 Kilby

Should read “Corporations cannibalizing the young”

Yep. Distribution of Weekly Wage Rates For Total Employment

#156 T.O. Bubble Boy on 09.25.12 at 12:29 pm

@ #131 Tony
Dammit, I bought a house in TO about 2 years ago before reading this blog….

On another note, does anyone know how to burn down your house without suspicion in order to collect the insurance and leave town?

Thanks!

Is this you???
http://www.cbc.ca/news/canada/toronto/story/2012/09/25/toronto-byng-fire.html

Should we expect to see more stories of a realtor/arsonist to be on the loose in Toronto?

#157 Victoria on 09.25.12 at 12:31 pm

Fritz,

Yup. You got that straight. I have the private client listing service and I have never seen so many properties come on the market. So many are the high end homes. Do these people have to sell… Are they over extended????

My RE agent – I have a lot of respect for him he is not a pumper and very honest- very well known in Victoria and I am sure he will be fine – said in his 25 years in business he has never seen anything like this before.

#158 Mr Buyer on 09.25.12 at 12:34 pm

Smoking man have you ever seen the aftermath of a bubble? I mean up close and personal? I have and I can tell you your understanding of the sheep will be challenged over the coming months and years. Good luck. I hope your persona downs not have to learn the way mine does, that is the hard way. 21 straight years of property value decline in Japan.

#159 Frank on 09.25.12 at 12:35 pm

At 70% home ownership in Canada, would the new rules make a difference? The market would still eventually stall since there would be a lack of new buyers. Foreign buyers have dried up and China is in a major slowdown mode.

#160 Investx on 09.25.12 at 12:39 pm

“This is the worst August number ever.”

Worst August EVER… or since 2009?

http://business.financialpost.com/2012/09/24/toronto-new-home-sales-fall-to-record-low-in-august/

“Based on statistics from RealNet Canada Inc., the 1,242 homes sold in in August were off from 3,496 a year earlier and the lowest figure for monthly sales since 2009.”

As stated. Worst August since records kept. — Garth

#161 Pr on 09.25.12 at 12:53 pm

Tsur Sommerville is a fake, notinh else to say. Garth you are not the only real pro that saw it coming. This man is a billionaire ( i think) and he told us to sell before its to late. http://argent.canoe.ca/lca/affaires/canada/archives/2010/02/20100212-162735.html

#162 brainsail on 09.25.12 at 1:08 pm

#131 Tony

“On another note, does anyone know how to burn down your house without suspicion in order to collect the insurance and leave town?”

I remember years and years ago when I lived in Edmonton in the dark years of the ’80s when a neighbor introduced me to a friend of his from BC that was a fire insurance investigator assigned to report on some recent house fires in the Edmonton area.

He said that most of the fires created on purpose were done using gasoline as an accelerant and days later after the fire was put out and when walk into a room where gas was used you can still smell it. A dead give away.

So now you know…

#163 Glen on 09.25.12 at 1:10 pm

Junius #126

Excellent post.

I like real estate and take no pleasure in the coming bloodbath. As someone else mentioned, many people are going to get hurt here.

Policy, not fundamentals fueled this bubble, and I do worry that F & the Peckerettes will be compelled to reverse course and turn the credit taps back up.

#164 Jesslyn on 09.25.12 at 1:14 pm

#121 Please, take it easy on the woman bashing, will you ?

I don’t disagree with what John is saying nor as a woman do I find it offensive. Maybe I am more traditional but I don’t think so.

When my husband and I were in the early stages of our relationship (early 30’s) he preferred to drive the car. At first I thought this was a ridiculous position for him to take. I had always owned my own car, was always the principal driver and I think I am a great driver:)

Then it dawned on me that this was a microcosm of the larger picture. Not arguing and giving into this request supported his desire to be engaged in our relationship on another level.

If I had diagreed and pushed the issue he would possibly have felt demasculated and that would have affected other areas in our relationship.

I also understood that it was important to allow these tendencies in each other so that in difficult times or with critical decision making I could rely on his level of engagement and the integrity of his decision making because I trust him. Just my opinion and my own experience.

#165 disciple on 09.25.12 at 1:35 pm

The plunge in new home sales was most dramatic in Halton at 90%, followed by York at 80%, and Toronto at 54%. Compare this with Durham at 38% and lastly in Peel at a measly 3%.

#166 Darren on 09.25.12 at 1:43 pm

Yes sir, I did get liquid.

#167 jess on 09.25.12 at 1:46 pm

cannibal discounting

http://www.advisor.ca/investments/alternative-investments/beware-company-pensions-85279

========

#168 Hawk on 09.25.12 at 1:57 pm

#130 Smoking Man on 09.25.12 at 10:24 am

<<<<>>>>

Agreed these are the two reasons that could cause a free fall in RE prices, if either/both occur. They would cause a crash of 40 – 50% or even more. However, the question is how likely are they to occur? No one can really answer that.

<<<<>>>>

Nothing’s forever, except God.

#169 robert on 09.25.12 at 1:59 pm

Time is the teller of all truths but unfortunately one can lose a small fortune while waiting for the truth to be told. In the case of the baby boomers that small fortune could be the equity in their homes that was earmarked for a source of retirement income. As the correction deepens i suspect that boomers will be scrambling to get their homes sold and they will not be prepared to haggle over 20 or 30k they will simply want to monetize this asset. This IMO will be the catalyst that really presses the downside in prices.

#170 Country Girl on 09.25.12 at 2:08 pm

#118 Toronto_CA
Re: Toronto Star & Globe

I’m sure they’ll publish something shortly. They’re probably very busy right now, shopping for lipstick.

#171 Coraline on 09.25.12 at 2:22 pm

#160 InvestX:

The August GTA sales are both the lowest monthly sales since 2009, and the lowest August sales since they started tracking the data 13 years ago. Please see the news release and the full BildGTA report to get the picture.

http://www.bildgta.ca/media_releases_2012_detail.asp?id=888

http://files.newswire.ca/1097/August2012.pdf

#172 Toronto_CA on 09.25.12 at 2:30 pm

#151 Regan on 09.25.12 at 11:51 am

The stats go back 14 years, not just to 2009 as you think. It was the worst sales MONTH since 2009, worst August on record. So worst August in 14 years. By population growth, that almost automatically implies worst August ever for sales since we should be having more transactions if the population has grown by millions over those 14 years? Maybe I’m wrong in that.

I’m not sure reading comprehension is your strongest attribute, but you write well and seem like a very nice person :)

#173 MrHulot on 09.25.12 at 2:32 pm

I am so liquid you can see right thru me.

#174 Bill Gable on 09.25.12 at 2:36 pm

Her husband had been a friend for 40 years. When he passed, his widow, figured it was simply a matter of selling the house and getting a smaller place.

That pipe dream has died.

I spent Monday afternoon trying to calm her down and get her in the frame of mind that we can sell the house. I have an HONEST and very trusted Broker friend who has stepped in to help GRATIS, so make sure she does ok.
Price drop, and some new floors.

I hate it when people lump RE agents in the same pile.

There are some great agents and there are some not so great.

Just like any other business.

#175 Smoking Man on 09.25.12 at 2:40 pm

158 Mr buyer

Yes I have up close and personal. Remeber when GST came out was in my early 30’s lost 1.5M. John crow had carneys job.

Bounced back up the next year import export south east asia.

With volitility comes opportunity. And you those of you who on a daily basis take track 6. You will never see it.

#176 house burden on 09.25.12 at 2:42 pm

Funny thing happened this weekend in vancouver

In the past week, people are starting to ask, could Vancouver/Toronto be like the US crash?

The sheeples are getting worried and once momentum picks up, you can bet believe no one will be interested in buying, instead they will expect a 30 to 70% drop before they will look into it.

Now with the US dollar and QE n+1 continuing to devalue the US dollar, US real estate is actually getting even cheaper to the world. Also Labour is cheaper. So what does it mean, well we’ll have american people working for old china wages meaning manufacturing and businesses will look at america to establish plants. Good-bye jobs in Canada.

Also with 70% of the people already in real estate in Canada, you only have 30% of them able to buy in, of the 30% wanting to buy in probably only 12% of them can afford to buy in. But of the 70% which has bought probably 25% of the went all-in and 35% can face problems if real estate prices went down or interest rates goes up or they lost their jobs

#177 Smoking Man on 09.25.12 at 2:44 pm

Mre buyer the trick is never think of money as money. Think of it as poker chips. If you think of monay as money you will be to scared to out in play. I accumalate wealth not for the sake of wealth. Fore the sake of it gives me more gambling chips

#178 Country Girl on 09.25.12 at 2:44 pm

#160 Investx
It seems that BILD have been keeping stats of units sold for GTA since 2005.
http://www.bildgta.ca/media_releases_2005.asp

I interpreted the FP article as follows:
“Toronto new home sales in August were the worst ever for that particular month” (meaning worst August since 2005)
and “the lowest figure for monthly sales since 2009” (to mean lower sales than any month since Jan. ’05).

Not saying I’m right, though.

#179 Country Girl on 09.25.12 at 2:50 pm

Garth,
Re: The Picture
Is that a dog or donkey?

#180 Country Girl on 09.25.12 at 2:52 pm

Re: #168
I meant to say “lower sales than any month since Jan. 2009”

#181 Country Girl on 09.25.12 at 3:00 pm

#131 Tom
#162 Brainsail
You picked a fitting topic for today. Learn what not to do from today’s news story:
http://tinyurl.com/8u4ld4l

#182 Timbo on 09.25.12 at 3:20 pm

http://www.rtve.es/noticias/directo2/

Protests in madrid live.

See what happens when realtors have nothing to do ;)

#183 jess on 09.25.12 at 3:22 pm

While the national figures tell a story of a housing market that is starting to improve, it masks the hardship that continues to be experienced locally. The impact of the housing crisis has been severe in some particularly hard-hit areas. In Florida, for example, 14% of all mortgages are in foreclosure, representing 1 out of 4 foreclosures in the US.2 In Nevada, the situation is similarly dire, with 6% of mortgages in foreclosure and another 6% seriously delinquent (90+days late). Not only are 60% of Nevada’s homes underwater but Nevada, as a state, is underwater, as the amount owed on Nevadan mortgages is greater than the value of all Nevadan homes with a mortgage.3 Despite an alphabet soup of federal housing assistance programs and an unprecedented period of record low mortgage rates, the current “recovery” means that housing’s contribution to GDP is only half of what it has been historically. (Mr Romney’s blog )
===========================
Romney’s white paper
“Sensible, Not Overly Complex, Financial Regulation That Gets Credit Flowing Again: By replacing the Dodd-Frank Act with sensible regulation, a Romney-Ryan Administration will usher in a new era of responsible lending with sensible regulation to allow banks to approve loans to families with good credit rather than rejecting their mortgage applications.”

=
As Mr. Black points out the sensible rules were there already!

“They had three sensible requirements for lenders that were not overly complex:

1.Lenders must underwrite before they make the loan
2.The underwriting must verify that the borrower has the capacity to repay the loan
3.The lender must keep a written record of the underwriting
Those three requirements impose no costs on honest, competent lenders – who would do considerably greater underwriting even if regulators did not exist. The three requirements greatly reduce fraud and incompetence and make it far easier to take effective action against frauds and incompetents.

The other great requirements of sensible lending are:

1.No perverse incentives may be created from the compensation paid to loan brokers, loan officers, and their superiors. “Performance” pay must be tied (and largely deferred) so that is paid on the basis of long-term loan performance rather than quantity or yield.
2.All real estate appraisals have to be independent and meet the professional requirements for approaches to value. No lending on the basis of “drive by” or “automated” appraisals.
3.The lender cannot select the appraiser and cannot communicate the sales price and loan amount to the appraiser. The appraisers should be assigned randomly from a qualified pool and the results of their work should be tracked to weed out those with significant error rates.

=============================
myth of the self made man

http://ourfuture.org/blog-entry/2012093823/self-made-myth-and-our-hallucinating-rich

#184 truth hammer on 09.25.12 at 3:25 pm

Real Estate has been a ponzi scam juiced up by emergency rates…….with the CMHC ( taxpayers) left holding the bag. Lets call it for what it is…a doubling of the national debt….and for what.

Sure…every pyramid scheme looks brilliant when it’s first offered…everyone wins…right? Wrong !! Every pyramid scam ends the same way…they run out of customers….there simply isn’t enough people on the planet to fill in the blanks in the math.. And that is exactly what has happened in Canada.

The ‘official ‘ numbers are always decieving…thats the fault of the civil service using phony money and phoney math to argue for bigger pay and pensions.

Look at the food banks numbers stating 900,000 heads of households now pick up their weeks groceries at the foodbanks across Canada…if the last census is right and theres 5 people under every roof that means that 4.5 million people rely on the food bank to keep from starving day to day. They are starving anyway…I have volunteered at a food bank and trust me…the food is not that healthy…mostly packaged processed stuff…the kind of salt and chemistry that will shorten your life by at least a decade…..let alone the effect on growing children.

Look at this laughable crap from the lying civil servants at Stats Can that ‘explains’ the disappearance of millions of workers from the unemployment rolls..

http://www.theglobeandmail.com/report-on-business/economy/jobs/more-canadians-abandoning-traditional-work/article4565994/

….they want you to believe that Canadians are not ‘unemployed’…instead they’re self employed…in the millions….Bwahahahahahahaaha …..every time I go to a coffee shop there are at least two to three tables of dog eared nervous looking wonks trying to sell each other computer services or consultancy gigs.

How many new ‘landscaping services’ flyers have to blow through the mailbox before you get the fact that people are not ‘self employed’…they are broke and desperate.

..every time I go to the local SuperStore theres a ‘Code 77’…..and it’s always some fat family guy who’s trying to get out of the store with bags of groceries that he hasn’t been able to pay for.

These are people trying to hold on…they’re in debt up to their ears…working poor…debt slaves…unable to feed their families. The numbers of hungry desperate people in Canada is growing……wages are going down due to the hyperinflation in consumer costs and general ‘fee’s’ and taxation.

When the deflating of the price bubble hits the refi desk at your local bank……there will be fireworks because there are people underwater by the millions. National Bank and CIBC are particularily exposed to household debt….be advised.

The market has been trying to tell us that a recovery may be on the way…but remember that the market is a forecasting tool in macro economics…it could be a few very tough years on Mainstreet Canada before the global turnaround comes around.

#185 jess on 09.25.12 at 3:41 pm

Ms Coulter is getting a history lesson
http://www.truthdig.com/avbooth/item/america_is_the_cause_of_its_own_immigration_problem_20120925/

pushed out of their countries and the pulled into cheap labour industries in capitalist usa.

#186 Smoking Man on 09.25.12 at 3:56 pm

Its so funny reading many post here all emotion driven. So call me a realtor I don’t care.

In the usa the marekets that got killed doubled in value in a high interest enviornment in a span of about 18 months.

Ontarion since 2008 prices have gone up on average of 18 prercent.

I light of the fact that jobs are plentyfull and with helecopter Ben printing green backs debasing the us dollar you think rates are going anywhere . Just down

But enjoy the bubble head dance for now. I will be around to pick you up and teach how its done

Smoking Man style

#187 Smoking Man on 09.25.12 at 4:02 pm

Premature_crashulation

#188 tkid on 09.25.12 at 4:03 pm

Struggling homeowners in Ontario are going to be hit by increased property assesments:

“Property owners should ask themselves if they could have sold their property for its assessed value on Jan. 1, 2012. If the answer is yes, then their assessment is accurate. If not, we are committed to working with them to get it right,” Mr. Hummel said.

http://www.theglobeandmail.com/report-on-business/economy/housing/assessed-value-of-ontario-homes-to-rise-property-tax-may-follow/article4567042/

January of 2012? Wasn’t the real estate market doing fine in January? Will homeowners be forced to pay taxes based on peak house prices, but not be able to get those prices if you try to sell the home in October because the market slumped since then? I’m not even a property owner any more and I find this outrageous.

#189 David Gordon Koch on 09.25.12 at 4:04 pm

Hi – I’m a freelance reporter and student in the graduate school of journalism at Carleton University. I’m looking for people in the Ottawa-Gatineau area, who “got liquid” and decided to pull out of the real estate market, or who are avoiding the market altogether and renting instead. Vernie (comment #93), I’m looking at you! Please get in touch: [email protected].

Try asking permission first, David. — Garth

#190 Regan on 09.25.12 at 4:16 pm

#172 Toronto_CA – oh don’t get testy. The link showing on my google search from the TREB went back to 2009. Give me a better resource if you’ve got one.

#191 Realtor # 1 on 09.25.12 at 4:37 pm

Why 70% decline in new home sales not a bad thing.

No more supply coming online.
You probably have at this time in time a year of supply condos in the resale market (including the ones that closed this year in new development)
If you bought a condo preconstruction this year, your deposit will probably be given back to you.

The ones that really get hurt are the construction workers.

#126 Junis
Your wrong the majority of people on this blog are waiting for a crash to purchase.
Remember RE will average out in the long run, nothing to worry about. Its part of the cycle.
I bought a rental in 89 during the last peak and i’m glad I did I will never see those prices again.

Prices will NOT decline past 2008/09 prices. RE has never gone past its last bust.

#192 Mr Buyer on 09.25.12 at 4:41 pm

#175 Smoking Man on 09.25.12 at 2:40 pm
158 Mr buyer

Yes I have up close and personal. Remeber when GST came out was in my early 30′s lost 1.5M. John crow had carneys job.

Bounced back up the next year import export south east asia.

With volitility comes opportunity. And you those of you who on a daily basis take track 6. You will never see it.
………………………………………………….
There has not been a housing bubble in Canada until now.

#193 daystar on 09.25.12 at 4:52 pm

#130 Smoking Man on 09.25.12 at 10:24 am Bubble heads 2 things required for home owners to drop there undees.

1 lost jobs. In the news retail sales threw the roof. Us consumer confidance threw the roof. Case shiller us market spike of 1.2.

2 rates need to spike. Anyone see what’s going on in spain and the ECB. Carney is peralized. F hit his traget he crushed condo sales.

——————————

I couldn’t help but add to the nuts and bolts of what you are saying since you’ve touched on important stuff but I find what you said to be somewhat incomplete and as a result, your conclusion in error and to save you from the potential bad karma coming from anyone who would actually believe in your reasons for market optimism, it compelled me to reply.

Yeah, unemployment is a big one to watch, bigger than average earnings income since unemployment is a leading indicator before average earnings but what I want to add is that RE employs either directly or indirectly through construction, service, financing, insurance logging, milling, advertizing and realtors a ton of people (1.4 million is the number I keep running into). If the entire sector slumps nationwide, a slump in RE would generate significant unemployment all on its own, not needing any help from growing unemployment from other sectors to lead to an economic downturn in Canada so the leading indicator in this case may not be unemployment the way you think it is, but a market downturn in RE. Real estate is our #1 domestic risk especially as it bites into equity hitting consumption (it has the potential to create long, painful recessions) and its triggers are:

1) Unemployment as it is the primary leading indicator of average earnings. However, one of unemployment’s leading indicators is RE sales volumes and values and because RE is such a large piece of the employment pie, I believe, because of valuations where they are at (sky high) that RE numbers are the leading indicator to watch before unemployment (and credit expansion, which says it all). Perhaps you should read Garth’s post one more time?

2) Tighter credit conditions. (the reason why I bothered to respond, interest rates are only the half of it) Tighter credit conditions don’t have to take the form of higher interest rates. Tighter regulations (25 year amortizations from 30, enforced 5% down, HELOC’s down to 65% insured) will also tighten credit and if its too tight (or in this case comes too late), cause a market correction all on its own.

Now…. if valuations are so sky high that any form of tighter credit will create any form of serious market downturn (like right now) then its not tighter credit conditions that are causing systemic risk, the risk is already there caused by the reality that credit conditions were so loose for so long without any real earnings support that RE values became highly unsustainable (and delusional, i.e. housing bubble) leading to number 3.

3) RE valuations are not built on earnings but instead, unsustainable credit conditions that lead to a market bubble and as we all know, market bubbles are unsustainable.

So lets recap. Unemployment numbers are the primary leading indicator of average earnings which have been lacklustre in Canada oh… since Harper. Credit conditions have been far too loose for far too long creating an unsustainable housing bubble in Canada oh… since Harper. Any kind of credit tightening will create a market correction in this instance so is it tighter credit that is the bad guy? Or… is it ultra loose credit conditions for 6 years prior or more creating unsustainable valuations and who’s fault is that besides everyone who had the most to gain by it? (Greedy CEO’s, advertizers, realtors, developers, spec and flippers that will always be there so its our first and last defence, our federal government that is supposed to do whats best for the system but failed because of their own lust for power and greed. I’m also tending to think that Harper has a mental disorder that doesn’t help, but thats for another time) And with all that employment generated through a boom in RE, now that the boom is over, where are the people reliant on this RE boom now gone bust supposed to find new jobs?

How are Canadians supposed to trust the very same people that led them to such domestic economic risk? Today’s politicians and CEO’s in finance have clearly demonstrated that they don’t care about systemic risk or people for that matter, that all that matters is power and money, basically…. themselves. The proof? Try a housing/credit bubble. (some folks think this blog is pathetic, its got heavy competition) Oh, so much to trust.

What I see coming to Canada over the next couple years is a 10 to 15% national market correction assuming interest rates don’t rise and… guess what. They very well could. QE3 is for MBS’s only. What that means to me is that the rest of the bond market has exposure to the possibily of higher rates outside of the RE sector and that could effect things internationally more differently than we think.

Canadians here should also know that CMHC is nearing its $600 billion limit, likely by the end of the year and with CMHC getting out of backstopping mortgages, will interest rates start climbing for MBS’s? There are 2 ways to look at that. Supply and demand is one. As the RE market slumps there is less MBS supply for MBS investors to buy but way more risk as CMHC gets out of 100% backed loans coupled with a RE correction (and potential bust) environment. Less volume hits supply but risk hits demand. In other words… BoC rates don’t have to go up for mortgage rates to go up in this country, overwelming risk in the market could do it so it isn’t just tighter credit caused by regs to worry about as a mortgage holder, its the spectare of higher rates from our banks and that threat is very real especially when one puts it over 5 and 10 year timelines. To downplay that risk is to talk someone into going “all in” (with extreme leverage) with a weak hand. Bluffs don’t count here, the better hand wins and frankly, a smart player doesn’t sit at that kind of table until valuations fall.

The only question is, how far valuations fall over what timelines and considering RE has the power to generate a half a million unemployed all on its own if sales volumes crash and has the potential to hit the economy hard through negative equity that hits consumer spending should values crash, that credit has indeed tightened without higher rates and that rates have nowhere to go but up with the greatest risk coming from the bond market as opposed to the Bank of Canada in the near term so its not hard to suggest to buyers/investors to take a big pause and wait for this bubble to deflate!! If thats a hard pill to swallow or too difficult for some to understand, then try the wisdom of buying into a market sector that is coming off a bubble. Any bubble. Its a great way for people to get creamed and go broke.

#194 Smoking Man on 09.25.12 at 4:53 pm

#189 David

Why on earth would you pick such a dumb occupation. Your thoughts and opinions will need to be filtered via the machines censors. Today reporters are just ball less gosip under paid tools for the machine.

Change you carrier fast. Learn to lie and take.

And ask for permission your a gest.

#195 GTA Girl on 09.25.12 at 5:13 pm

Hi disciple!

No, I don’t believe the Stegman’s Mill house sold. The listing could have expired

Not much selling.

And you mentioned your blog…do you think Garth would mind if you include the link?

#196 Mr Buyer on 09.25.12 at 5:19 pm

How about China? Aircraft carrier to the Japanese Island. It is more than a little rude awakening to the true nature of the communist military dictatorship we have been gleefully sending our manufacturing jobs to and buying cheap goods from since Nixon warmed up to them in the 70s or there about. We have helped them modernize their manufacturing infrastructure and their military at our own expense. Harper should not allow the Chinese as a Communist and Militaristic opportunist to gain any further influence over Canada’s natural resources. China means Japan harm. I look at the faces of my beautiful Japanese Canadian children and I can assure anyone reading this that my beautiful 3,5 and 8 year old children had absolutely nothing to do with the horrors of world war two. I would never suggest that China did not suffer hell on earth at that time because China did. This suffering does not justify handing out similar suffering to Japan at this time or anytime in the future. Japan did not escape the war unscathed, the world can argue as to whether or not Japan paid a heavy enough price or whether or not Japan has properly acknowledged the misdeeds of the Imperial Japanese Army of the past but the world can not pretend Japan got off Scott free. We as Canadians have little understanding of the depth of discrimination the countries of China, Korea and Japan hold against each other and maybe it is best to let these countries have at each other again but we should not pretend our turn is not coming. The small sector of North American society that benefited from moving our manufacturing to China must come to understand the grave error they have committed. War has been threatened against my innocent children so please forgive my dark nature.

#197 Rob now in Nova Scotia on 09.25.12 at 5:23 pm

Yes, I got liquid. 100% in silver and silver stocks and can turn them into cash in less then a week.

#198 Spiltbongwater on 09.25.12 at 5:30 pm

Let’s flood David Gordon Kochs inbox. I will see if he is on FB, and troll him there.

#199 espressobob on 09.25.12 at 5:49 pm

#9 Freedom first, Your comment Rocks.

#200 neo on 09.25.12 at 5:51 pm

#165 disciple on 09.25.12 at 1:35 pm

The plunge in new home sales was most dramatic in Halton at 90%, followed by York at 80%, and Toronto at 54%. Compare this with Durham at 38% and lastly in Peel at a measly 3%.

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

Where did you get this information from?

#201 Junius on 09.25.12 at 5:52 pm

#184 Truth Hammer,

You said, “Real Estate has been a ponzi scam juiced up by emergency rates…….with the CMHC ( taxpayers) left holding the bag. Lets call it for what it is…a doubling of the national debt….and for what.”

Up to that point you had me. I agree – 100%.

Then you launch into a mindless rant about it being the fault of civil servants. Can’t you admit for once that your beloved Cons screwed up? That it was H and F who slit the wrists of this country through their manipulation of the CMHC? Can you at least try and establish some credibility? Or are you just going to remain an ideological demagogue?

You are entitled to your own opinion but not your own facts. Every political party was responsible and not the civil servants. However it was the Cons who took it to a new level and pushed CMHC debt from $100B to over $600B. Those are the facts.

#202 Junius on 09.25.12 at 5:56 pm

#163 Glen,

Thanks.

You said, “I do worry that F & the Peckerettes will be compelled to reverse course and turn the credit taps back up.”

I think their options are now very limited. Household debt is too high and the economy too shallow for them to try and use the housing market again to juice the economy. It is a one time event that would not work the same way again.

The international concern over our debt levels including the CMHC risks will now take precedence. They will now act like they are prudent stewards of the economy and keep working to rein in the damage.

Sort of like an arsonist who joins the fire department to put out the blaze they set.

#203 neo on 09.25.12 at 5:58 pm

#133Penny Henny on 09.25.12 at 10:37 am
So our ownership rates in Canada are 70%. Big frickin deal.
Rates in the U.S. are a touch under 65% and guess what, there are many who want to buy if they could get approved.
Problem is banks still need to dump the bad mortgages to the Fed before they start issueing anything mortgages to those without gold balls.
70% is not the tipping point.
The sky is not falling.
Penny Henny

Penny,

You do realize the U.S. peaked at 69.2% home ownership before the crash right? So they didn’t even make it to 70% even with no income no job loans running rampant. By the time the crash leveled off they were down to 66.6% and are now at 65%. I hardly find that encouraging for our situation. Instead of pretending like you know what you’re talking about. Look at a 50 year chart of home ownership and the CMHC’s balance sheet and you will find out that we will end up at that 66% ownership level when it is all said and done several years from now. Just like the U.S.

#204 Junius on 09.25.12 at 6:03 pm

#185 Jess,

The US immigration problem is just one of the many example of the law of unintended consequences at work. One of the causes of increased illegal immigration from Mexico was the impact of NAFTA. The US agriculture industry dumped subsidized corn and grains into Mexico and essentially forced Mexican farmers into cash crops. This ended many Mexican family farms and caused these people to seek work in the US.

Yet another victory of ideology over common sense ends with a different outcome than predicted by the “experts.”

#205 Victor on 09.25.12 at 6:30 pm

Canadians’ debt bonanza: A week of warnings

Sep 25, 2012

In case you somehow missed the news: Canadians are deep in debt and getting in deeper. Our 152% debt-to-income ratio is being burned into our brain.

If you don’t feel badly enough about it, this week has seen a deluge of commentary, reprimands and suggestions for how to shape up. Here’s a summary of some of the news on the debt front:

http://business.financialpost.com/2012/09/25/canadians-debt-bonanza-a-week-of-warnings/

#206 NoName on 09.25.12 at 6:38 pm

#139 Kilby on 09.25.12 at 10:59 am

Kilby plz tell me who runs corporation, who are the people in position that can influence change?
gex x or gen y… NOT

older stats 1995, and 2012 newer stats below
According to a survey by Delaware management consultancy Booz Allen Hamilton of the 2,500 largest publicly traded corporations, CEOs in the United States are entering offices at younger ages. In 1995 the average starting age of a CEO was 50.4 years; in 2001 it dropped down to 48.8. If you’re in a rush to get to the top, consider information technology, where the average age is 45.2 years old, or telecommunications, with an average age of 45.7 years. Among the oldest rookie CEOs are those in the materials services, averaging 53.7 years, and the utilities sector, who averaged 52.5 years. Across industries, the average CEO is 50 years old upon taking office.

Median age for a S&P 500 CEO 55
(Date Verified: 1.25.2012)
http://www.statisticbrain.com/ceo-statistics/

The NPD Group report on Canadian Baby Boomers 2010
Two-tiered wage system, whose idea is that?
http://www.canadiansocialresearch.net/images/ceo_income.jpg

Kilby, truth will set you free…

#207 robert james on 09.25.12 at 6:46 pm

#191 Realtor #1 You stated that,,”Prices will NOT decline past 2008/09 prices. RE has never gone past its last bust”. That is interesting but I think you will find that this time prices will drop past the last bust mainly because there has not been enough time for inflation catch up.. Anyway,, I think we will find out very soon as Vancouver must be getting close to the 2008 2009 bust now and the this bust has just started..

#208 Nostradamus Le Mad Vlad on 09.25.12 at 6:57 pm

#90 SCIB — “QE3 and artificially low interest rates are part of the largest theft of personal property since the beginning of time.” — That, essentially, is what it’s all about — the removal of money from the ‘system’, with the money heading to TPTB, the middle class and the poor get the scraps or nothing at all.

#98 maxx — “The piper is senile and drooling, avoid RE like the plague.” — That’s a polite way of saying it!

#105 GregW, Oakville — G’day Greg. Trust you’re keeping well.

Yes, I did see that a few nights ago. One of the reasons for the ‘net crackdown in the west, is that more and more sheeple are waking up to the cold hard fact that 9-11 was an inside job, through and through, and those responsible (TPTB) don’t want their names or faces revealed.

Noddin’ Yahoo, dubya, phoney Tony and Obomba plus a few others will suffice. Cheers!

#139 Kilby — “Should read “Corporations cannibalizing the young” — That’s right. Sheeple are expendable, corporate profits not.

#142 Marcus — “Who will buy the billions in stock that they must sell? Exactly….the FED. The sound you hear is the toilet being flushed on America . . .” — Bang on. With a stroke of the pen, the point is made clear. The pen is mightier than the sword!

#187 Smoking Man — “Premature_crashulation” — Great description of the male part of humanity!

#209 Form Man on 09.25.12 at 6:57 pm

DA ! wake up !

Junius has an excellent comment at #202 explaining why the Feds will not try and re-inflate the housing bubble…….

#210 Don't read his post on 09.25.12 at 7:00 pm

“You got liquid when I told you, right?”

Yup, about one month ago. The thing is I got really lucky cause I sold with a tenant in the house. It was the best move I ever made. My wife and I will be taking 2-3 vacations a year. We just got back from Europe, it was amazing.
Did I mention that I owe this all to you….
Thanks Pal

#211 TRT on 09.25.12 at 7:04 pm

DO NOT CROSS THE BORDER WITH CHEESE!

Cheese is being smuggled across the border and sold illicitly in the streets, at Pizza shops and restaurants. Officials in Canada say it is a serious health hazard as too much clogs arteries. They also point out that gourmet cheese is addicting.

Border officials have busted a ring and are seeking life in prison. The public is happy that law officials are upholding the law.

http://www.wellandtribune.ca/2012/09/25/border-agency-wont-talk-about-cheese-smuggling

End the dairy/poultry cartel!

#212 Ronaldo on 09.25.12 at 7:06 pm

http://www.lyndahinton.com/index.cfm?fuseaction=detail&startrow=72&cfid=16847512&cftoken=73793472

Here is what the price of a Vancouver ”tear down” will get you just across the border from the peace arch.

#213 Junius on 09.25.12 at 7:13 pm

#191 Realtor #1,

You said,”Your wrong the majority of people on this blog are waiting for a crash to purchase.”

How do you know? Did you take a poll? You have absolutely no basis to make this claim.

Then you said, “Remember RE will average out in the long run, nothing to worry about. Its part of the cycle.”

Wrong. This is not a business cycle recession. That is the part you are missing. This is a balance sheet recession. Prices did not rise based on productivity gains and rising wages but on access to cheap credit. Learn the difference.

Finally you said, “Prices will NOT decline past 2008/09 prices. RE has never gone past its last bust”.

Is this because you capitalized because YES THEY WILL. See the answer above. A simple return to historical fundamentals will bring us below 2008 levels nation wide. Some places are already there.

You clearly fail to grasp both the cause and extent of the current economic conditions. You should start there in your study because clearly you didn’t get the memo of why the market crashed in 2008 and how it was temporarily pumped up.

Also, don’t forget, markets usually overshoot on the way up and the way down. We have a long way to go down.

#214 John on 09.25.12 at 7:15 pm

Frank le Skank wrote:

“Hey John the Douchebag, stop ending your comments with the word “fail”. Garth did that on one of his post and you’ve latched onto it because your lack of imagination and individuality doesn’t allow you to come up with something on your own. You are not Garth, shut up.

Stop nit picking inconsequential parts of a comment and cutting it down for no apparent reason other than to make it appear as though you contribute something worth while to this blog.

GFY John”
—–
Actually “fail” is a hugely popular term on the internet, thus known as an “internet meme”. You can brush up on what’s going on with that here:

http://vimeo.com/m/2108952
( kind of funny).

I didn’t notice any content, debate or relevance in your post, but the word “fail” for me comes out when someone is painting a toxic belief system as “reality”. It’s so far off the mark, so out of alignment…that it deserves a fail.

Of course prior to the “fail”, I back up my opinion with lots of content and relevance.

For example, your post wouldn’t get a “fail”, because it can’t go anywhere and argues nothing. For real estate discussions you might float some hot air, mainly because it’s a really emotional topic. “Fail”has to be part of a debate going in the wrong direction…and it’s not necessarily aggressive, just provocative. I like it.

#215 Smoking Man on 09.25.12 at 7:21 pm

Daystar

Haper is the most powerfull PM canada has ever had. No priminister in history has sold his soul to the machine like me has. The Machine needs him at min for another term. His Govt just put the brakes on the re market. But the machine will not allow it to go into reverse. Just watch an remeber who told ya.

Beer to anyone who finds a negative re story in the MSM in two weeks. I know how the machine operates, I wrote the manuale. I know how the herd does not think.

Another great lesson for you bubble heads coming up

#216 John on 09.25.12 at 7:28 pm

Frank, here’s the same video on “fail” in youtube. Not sure if the vimeo version opens for everyone ( fail).

Just go to 2:18 and listen for 10 seconds to figure out what’s going on. The good news is that a fail can even turn into a “win”. So there’s hope.

http://www.youtube.com/watch?v=K754RWX-AGM&feature=youtube_gdata_player

#217 jess on 09.25.12 at 7:37 pm

http://www.corporateknights.com/article/canada-swindler
http://scc.lexum.org/en/1997/1997scr2-165/1997scr2-165.html

#218 Bubble Watcher on 09.25.12 at 7:48 pm

#196 Mr Buyer on 09.25.12 at 5:19 pm

— we have been gleefully sending our manufacturing jobs to and buying cheap goods from
— We have helped them modernize their manufacturing infrastructure and their military at our own expense.
_______________

Mr. Buyer,
1. “You” cannot claim that you REPRESENT the whole country Canada or the whole nation Canadian. Who gives you this authority to speak on behalf of all Canadians? I am a Canadian; and I certainly did not endorse you this authority. Lastly, you certainly cannot represent the whole WEST as you implicitly claim to.

2. Shipping all the manufacturing capacity to China is bad, so shipping all the camera, TV, Car manufacturing capacity to Japan is good. Right? Last time I checked, all the cameras, TVs and automobiles were invented in the west.

3. Lest people forget, Japan was the aggressor for the last one hundred years to its weak neighbours and committed unspeakable mankind crimes. It eventually deservedly got punished! Repent first!

4. The dispute over the island is sovereign issue. Not ideological. Don’t try to introduce the ideology into this dispute in order to try to get the whole West to back you up.

5. How many aircraft carriers that China has? By my count, just one so far for training purpose. How many Japan has?

6. Nobody says your beautiful 3, 5 and 8 year Japanese Canadian children have anything to do with the horror of WWII. It is your biased, jingoistic militarism which potentially could push them into replay of the tragedy.

7. A modern, strong China will prevent another Japanese aggression!!! Much to your disappointment.

#219 Daisy Mae on 09.25.12 at 7:49 pm

China’s ghost towns and malls: http://youtu.be/rPILhiTJv7E

Do we always have to learn the hard way?

#220 Johnny D on 09.25.12 at 7:54 pm

http://www.leaderpost.com/business/Real+estate+market+cooling+Regina+says+report/7293827/story.html

REGINA HOUSE SALES FELL 13%… BUT NO WORRIES, PRICES WILL STILL RISE 7%. SO BUY NOW OR GET PRICED OUT!!!

What B.S. Leader Post

#221 Not 1st on 09.25.12 at 7:55 pm

Damn, Sask got caught too this time.

http://www.leaderpost.com/business/Real+estate+market+cooling+Regina+says+report/7293827/story.html

#222 Fires in the GTA as flippers panic! on 09.25.12 at 8:00 pm

Looks like people are buring their houses down as the housing crash is going from bad to worse in Toronto. Realtors are very worried and you can see that from the many posts on this blog from realtors who can not make a single sale. Another flipper burns their house down.

http://www.cbc.ca/news/canada/toronto/story/2012/09/25/toronto-byng-fire.html

#223 Daisy Mae on 09.25.12 at 8:07 pm

#164 Jesslyn: “If I had disagreed and pushed the issue he would possibly have felt demasculated and that would….”

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

Poor baby…..

I can’t believe in this day and age, women are still being relegated to the back seat of their own vehicle while the husband and the male occupant take the front seat. I’ll make the exception only if the male occupant had long legs and would otherwise be cramped. LOL

#224 Ladybug on 09.25.12 at 8:20 pm

You say no place is exempt from the coming real estate down turn? Wait! You obviously didn’t get the memo from a local realtor.

“I appreciate your opinion and have always wished I had a crystal ball to predict the future. I thought you would be interested that the July & August statistics from my MLS board showed improvements over last year with regard to sales in the Shuswap. We of course don’t only rely on stats but it gives us a recent guideline to where the real estate market is overall. I wish I knew what was in store for us here in the area.” . . . “I can tell you from my experience is that if a price reached a high price in the past it will always bounce back to that price (the question is when will that happen?)

Our markets have changed over the last 7 years due to such Global impact on the local economy. Before it never mattered what was happening in the world or even our country. It seemed the only 2 provinces economies impacted our local market (Alberta and BC). We still see that to a certain degree but not as strong as before as there are many of the same opinion as you. I have concerns that commercial growth to our area has been slow and wish we would get a few more anchor outlets for better shopping. The Shuswap has always been a life style destination. If you look at demographics the majority of the population (Baby Boomers) are reaching retirement or semi-retirement. Based on the demographics alone and the lifestyle draw the Shuswap offers I would be surpised to see the bottom fall out of the market.

So there you have it – my opinion. Who knows really what the future will hold. I wish I knew!”

See, Mr. Turner, it IS different here. The nice lady realtor said so. (And did you notice, it’s my fault if it isn’t?) Oh well. :0)

#225 Risk Analyst on 09.25.12 at 8:41 pm

Does anyone know where I can London Ontario house statistics. Unit sales, average price etc. thanks in Advance.

RA

#226 Canadian Watchdog on 09.25.12 at 8:55 pm

Like I always say Garth: when the lending stops, everything stops.

http://i49.tinypic.com/30jgxnn.png

#227 JimmyAAA on 09.25.12 at 9:04 pm

#201 Junius

If you are not aware, The truth according to hammer is that any intelligent decisions made by F and the Peckerettes are made in spite of the civil service. These amazing polictos have been operating surreptitiously in their role as ELECTED OFFICIALS to undermine the real power behind the throne, civil servants.

As usual with the hammer there is some truth in that statement but he can’t have a rational discourse on it, he must take it to an extreme. Kinda like the GOP these days.

#228 Honest Realator on 09.25.12 at 9:19 pm

See a special note in property detail of MLS#:E2433454

***Agents See Commission Bonus**

That is why TREB does not want loose its control over MLS.

#229 Kilby on 09.25.12 at 9:24 pm

The NPD Group report on Canadian Baby Boomers 2010
Two-tiered wage system, whose idea is that?
http://www.canadiansocialresearch.net/images/ceo_income.jpg

Kilby, truth will set you free…

McGraw Hill, CME Group and Barclay’s aren’t controlled by 53 year old executives, check who really runs the world…………..

#230 Junius on 09.25.12 at 9:26 pm

#219 Daisy Mae,

You asked, “Do we always have to learn the hard way?”

I am assuming this is a rhetorical question as the answer is clearly yes.

Have you noticed that Garth’s recent press has brought a whole new group of doubters with the same arguments as the last crowd who came.

#231 Mr Buyer on 09.25.12 at 9:31 pm

7. A modern, strong China will prevent another Japanese aggression!!! Much to your disappointment.
………………………………………………………………
What will prevent a Chinese aggression is my concern

#232 Realtors and bankers in an all out panic on 09.25.12 at 9:40 pm

Realtor smokingman ..The machine as you said is really just pulling the plug. The US government has given Harper the word to crash Canada`s housing bubble. You think the US would allow Canada not to suffer and look better then the US …. Canada will suffer a bigger crash then the US. It`s going to be a NASTY CRASH smokingman a NASTY CRASH!

#233 Mr Buyer on 09.25.12 at 9:40 pm

Mr. Buyer,
1. “You” cannot claim that you REPRESENT the whole country Canada or the whole nation Canadian. Who gives you this authority to speak on behalf of all Canadians? I am a Canadian; and I certainly did not endorse you this authority. Lastly, you certainly cannot represent the whole WEST as you implicitly claim to.
………………………………………………….
I am a single individual speaking to my country men and women as I am permitted to do and you are as well within much broader limits that our fellow humans the Chinese of China are permitted to do. You speak of jingoism while Chinese Generals state openly they are prepared for war over an island that the US stated in treaties with Japan is clearly Japanese. I do not speak for my country men and women but rather to them when I say wake up and listen closely to the rhetoric and watch the actions of the government from which we import a huge amount of manufactured goods on the backs of cheap labor provided by the great Chinese people themselves. No I am sorry but Japan is not the aggressor in this case. Nice try. A bit hamfisted and I will be happy to gone on.

#234 Gunboat Denier on 09.25.12 at 9:48 pm

75 TC 59 Fritz – further to my comment at 127

http://www.bclaws.ca/EPLibraries/bclaws_new/document/ID/freeside/96250_18

Division 5

So it says a tax sale “purges and disencumbers” the land of financial charges. But if memory serves me correctly,
amost all mortage holders will pay the taxes to ensure
they do not lose their interest.

#235 Bubble Watcher on 09.25.12 at 10:14 pm

#231 Mr Buyer

What will prevent a Chinese aggression is my concern
_________________________

Based on what evidence you think there will be Chinese aggression to your beloved Japan?

As you pointed out, Japan is under American defence treaty. Right?

Sincerely reflect on your war crime first!!!

#236 Bubble Watcher on 09.25.12 at 10:21 pm

#233 Mr Buyer on 09.25.12 at 9:40 pm

Japan is not the aggressor
_____________

Say whatever you little dark mind wish. But you cannot distort history and fact.

Repent is your only way to prevent your decedents to have another punishment by the mankind!

#237 DON on 09.25.12 at 11:37 pm

Wow! 225 comments and climbing. In the aftemath of the news coverage this blog has been seeing a steady increase in the anti-bubble crowd.

I started to see the irrational buyers back in 2004-5 when I saw a place refered to as “cougar hill” be developed so retired folks could live in 4+ bedroom houses, with two people and a little dog (on cougar hill). Most planned for their grown kids to visit once in a while (hence the multi-bedroom – 2400+sq foot houses?). The area is located @20 minutes from the basic amenities, 40 from a hospital and outside the local fire protection zone. One older gentlemen came right out and told me he was looking to put in a cheap fence that would last for at least five years in a wet climate – as he only planned on being around that long. I started to wonder who would replace this aging army of cougar hill invaders (I should clarify cougar hill is not a nightclub). Not enough high salaried workers in the area. Most already bought. The winters are bad, roads scary when it snows, power outages when it gets damp and windy. Most were snowed in for at least a week or more without electricity at one point.

Now, when I visit the area I see for sale signs everywhere. Mean while all the youth are on their way to Alberta to work. When a town’s average age goes up as people move in, it’s a short term business model. And when people live 20 minutes from that town and away from the pharmacy, doctors etc not a long term outlook. Everyone was getting into the game, high and low income earners, students, young and old. The rest is logic and reasoning.

Vancouverites got sucked into the delusional game and so did the rest of the country. I thought at least when the US slumped, Canadians would take note. I was disappointed, then there was Ireland etc. But now… at least I was able to get an education in human nature.

Vancouver is just a clique sub culture and very delusional, sorry …a place that experiences relentless pouring rain 8-9 months out of the year has no right to say “every body wants to live here” – that’s exaclty why I moved away.

#238 cynically on 09.26.12 at 2:26 am

#176 house burden – Re your US-CDA dollar scenario – Canada, not being principally a manufacturing country, will not be looking to establish plants in the US and what manufacturing is in Canada won’t be sufficiently selling to them so it would be then you could say goodbye to jobs in Canada. However it is all moot as the US, as a nation, is too resilient and will bounce back.